RAM LAL INDER LAL vs Oriental Insurance Co. Ltd.

APPELLANT was the complainant before the State Commission, where he had filed a complaint alleging deficiency in service on the part of the respondent.

UNDISPUTED facts of the case are that the appellant has an Open Marine Insurance Policy cover obtained from the respondent Oriental Insurance Co. Ltd., covering risk of turn-over of Rs. 8 crores. Policy was issued; valid for the period in question. As per the complainant, he purchased ground nut oil from Nirmal Rice and Oil Industries, Gangapur, for a consideration of Rs. 3,61,233.88 ps. When it was being brought to Delhi on 23.11.1994, it met with an accident, as a result of this, the ground nut leaked or was destroyed. It is in these circumstances, a claim was filed. The Surveyor was appointed and he gave a favourable report, yet the claim was repudiated vide letter dated 16.9.1996. Thus, alleging deficiency in service a complaint was filed before the State Commission, who after hearing the parties dismissed the complaint, hence this appeal before us. The case of the complainant/appellant before us is that this was neither a case where over-all limit of Insurance Company was exceeded nor was it a case as alleged by the respondent that the complainant made one entry against two transactions.

We heard the learned Counsel for both the parties at some length before us orally as also perused the grounds of appeal filed by the appellant. Largely same two grounds have been taken in the memo of appeal.

DEALING with the first thing first, there is no disputing the fact that the goods were purchased from Kotkapura for a price of Rs. 3,21,715.30 ps. which was carried by Kisan Road Lines from Kotkapura to Delhi and the same goods were again forwarded to Hyderabad vide a separate goods receipt and invoice valued at Rs. 3,55,610 whereas in the declaration this has been shown as a single transaction. The point at issue is whether under the terms of the policy this should have been shown as one transaction or two transactions? We have very carefully gone through the condition of the policy. We are of the view that each and every transaction has to be declared separately. The spirit of the open marine policy is that it will cover the risk of each and every transaction involving transportation by road from anywhere in India to anywhere in India. It cannot be left to the sweet Will of the insured firstly to declare or not to declare the transaction he likes, and also merge two transactions into one, especially, when the original G.R. was made from one destination to second destination and subsequently the insured decided to consign it to different destination. As rightly held by the State Commission, it shall amount to two separate transactions, whether the terms of policy, necessitating two separate declarations as they are two separate transactions. In the memo of appeal the appellant has tried to cover this deficiency by relying upon the policies issued in similar circumstances by New India Assurance Co. and United India Insurance Co., etc. But we must state it to the credit of the appellant that he has also stated that in these policies the terms of the policies in itself provided flexibility/liberty to the insured for any change of destination in transit or to transit the transaction as per the provisions of the Section 6(ii) of Central Sales Tax Act. It needs to be noted that there is no such provision or condition in the policy issued and obtained by the parties in the instant case, hence in our view, the appellant cannot take advantage of a non-existing provision especially in view of the fact that as held severally, the policy is a contract between the parties. Since there is no such condition, we cannot borrow any provision mentioned by someone else in any other policy, issued by a different Insurance Company. Hence, we see no merit in this plea taken by the appellant. In our view, more serious is the question of declarations. Admittedly, two statements showing quarterly transactions were given when this accident occurred but while the Surveyor was appointed, whose report is on record, more importantly, the insurer also appointed ''CGA Consultants Surveyor'' to ascertain the veracity of the transactions mentioned in the two quarterly statements. We are constrained to draw an adverse inference from the fact that since this document (which apparently is against the appellant) which was before the State Commission finds no mention by the appellant in the memo of appeal or brought on record by the appellant. It cannot be disputed that this Consultant Surveyor had interaction with the appellant and after that he has submitted a report. Besides other things, it is clearly stated in his hand written report that for an amount of Rs. 1,07,12,535.50 ps. purchases were made locally, i.e., in Delhi but sale effect was outside Delhi, and, for Rs. 50,59,653.99 ps. Declaration was not made by the insured. This report was very much within the knowledge of the appellant, but they have not agreed to meet these specific points. The appellant''s contention is that as against a cover of Rs. 8 crores, till December, 1994, they had utilised the limit of Rs. 7,97,06,102.40 ps. for resolving the controversy, we rely upon two letters on record dated 20.3.1996 issued by the Insurance Company to the appellant and appellant''s reply dated 5.4.1996. For purposes of facility, we reproduce both these letters.

THE letter from respondent Insurance Company dated 20.3.1996 reads as follows: "Dear Sir, Re: Claim No. 21/95/00002 Loss under GR No. 053 dated 22/11/1994 Tanker No. HR-12-8344 Ex Gangapur City to Delhi-your Bill No. 85 dated 22.11.1994. With reference to the above loss, you are requested to please let us have the following: (1) If you have made any payment to the seller against the above transaction. Please send us the particulars thereof or get it certified by the Surveyor M/s. G.G.A., Consul-tants and Surveyors, Delhi. (2) As per the details given by our Surveyor the sum insured in policy had already exhausted, kindly let us have your claim in this regard. (3) You had not declared all the consignments against the insurer. (4) You have declared one sum insured against sale as well as purchase for both the transactions. You are requested to kindly clear the above to enable us to proceed further in the matter. Thanking you and assuring of best services always."

(Emphasis supplied) The letter from appellant dated 5.4.1996 reads as follows: "Dear Sir Reg. Tanker accident/non-delivery vide T No. 8344/HR 12 (GR No. 053 Date 22.11.1994 Carrying G.N. oil Ex Gangapur City to Delhi accident between Sahapur and Kotputli Claim No. 21-95-00002. With reference to your letter dated 20.3.1996 regarding above said loss, we have to submit as under: (1) We have made payment to the seller against the above bill vide Draft No. 622687 dated 19.11.1991 for Rs. 3,67,000. (2) We have taken the policy for Rupees eight crores on 14.5.1994. The accident took place on 23.11.1991. By 19.12.1994 the policy was utilised for Rs. 7,97,06,102.40 only. How the Surveyor can say that had already exhausted. We have already informed you vide our letter dated 15.12.1995 and 15.1.1996 along with the copies of bills that there are a few parties which send these goods at their own risk and the payment to them after the goods are delivered to our place, therefore, we have not declared these (illegible....) insurance purpose. We have taken insurance on purchase price and we declare the same and we have and also on the purchase price only. That is why we declare same sum insured for sale and purchase both that stations. Moreover we have not taken insurance cover for consignments within eighty kilometres of Delhi city. This was made clear to you at the time of taking the policy, hence we have not included such consignments in statement. We hope the above statement will satisfy your queries. Thanking you, Sd/- "

(emphasis supplied) Two things emerge from the letter dated 5.4.1996 by the appellant addressed to the Insurance Company. Firstly, that the consignments transacted upto 80 Kms. were not mentioned in the declarations and secondly, two discrepancies mentioned earlier of Rs. 1,07,12,535.50 ps and Rs. 50,59,650.99 ps. have not been explained, at any stage before the Insurance Company, before the State Commission or before us, this leaving us with no option but to draw an adverse inference both on the ground that appellant conveniently omitted to bring this report of the ''Consultant Surveyor'' on record and secondly not meeting these discrepancies where he has not declared, especially when they were referred in the letter dated 20.3.1996 sent by the insurers to the appellant. The terms of the policy clearly stipulated, "Anywhere in India to anywhere in India (Below and above 80 Kms)" leaving us with no choice to the appellant to exercise any option of not declaring consignments upto 80 Kms. Under the agreement terms of the contract, which the policy is, he was obliged to declare all the consignments. We are not in agreement with the findings returned by the State Commission that if a consignment was not declared, it will fall outside the risk. This Commission has had occasion to deal with the similar issues and has consistently held that under the open marine policy, the insured is obliged to declare each and every consignment. Since the appellant has not been able to satisfy us or the Surveyor and for that the insurers that at the time of accident he had not exceeded prescribed limit of the cover, we find that the two main pleas taken by the appellant, does not stand our scrutiny. Clearly the appellant has failed to satisfy us that the transaction in question from Gangapur to Delhi was within the prescribed limit. It would have done them some good, had the appellants explained the discrepancies pointed out by the Consultant Surveyor, especially in view of the admitted position vide his letter dated 5.4.1996, that they have not shown the consignments within 80 Kms, which is contrary to the terms of the policy.

WE cannot find any fault in the main ground of repudiation that "the sum insured stands exhausted under the policy........"

THE appellant tried to improve his case by bringing on record the policy endorsement at the time of arguments by filing written arguments. We have seen them. We only find the written arguments; we do not find any ''policy endorsement'' even though, mentioned in the index. In the aforementioned circumstances, we find no deficiency in service on the part of the respondent. This appeal has no merit, hence dismissed. Appeal dismissed.