UNITED INDIA INSURANCE CO LTD vs Navrathan Kothari

FIRST Appeal No. 437 of 1993 has been filed against the Order dated August 4,1993 of the Maharashtra State Consumer Disputes Redressal Commission in complaint No. 119 of 1992 directing the opposite party (United India Insurance Company Ltd. Bombay Branch) to settle the complainant''s claim for Rs. 3,28,178/ -with interest at 18% p.a. from 7.12.89 till the date of realisation and to pay Rs. 500/ - as costs to the complainant.

FACTS of the case from the available records are: The complainant had obtained insurance policy on 17.10.89 from the opposite party to cover one tin box containing cut and polished stones valued at Rs. 3,72,460/ - during transit from Bombay to Bangkok by air mail. The insurance covered all risks including pilferage, non -delivery, warehouse to warehouse. The complainant alleged that the tin box reached Bangkok and it was found that a part of precious stones was pilfered during the transit causing loss to the complainant for Rs. 3,28,178/ -. The complainant reported the incident on the same day to the Surveyor nominated by the United India Insurance Company and it was investigated by the surveyor, who assessed the value of loss of 570.54 carrots at Rs. ,28,178/ -. The complainant alleged that the opposite party -Insurance Company rejected the claim on unjustifiable grounds. The opposite party contended that the box in question was delivered in good condition at the destination, and that therefore there has been no deficiency in service. According to the complainant when the box reached the destination, the package was accepted without minute examination and receipt was given about its delivery. Therefore, when the package was opened by the customer, he found that the tin box was tampered skillfully and the pilferage was done by removing some precious stones. According to the complainant, there were no apparent visible signs on the package of tampering when it was delivered. In the absence of apparent signs, the receipt dated 20th October, 1989 was issued by the customer acknowledging receipt of the package. 3. The, State Commission relied on the surveyor''s (Loyd''s) report which described the manner in which the tampering of the package was done and which concluded that "out of ten packages of emerald, 6 were removed due to the act of pilferage", as strong evidence in support of complainant''s claim. The State Commission was also of the view that the acknowledgement receipt given by the customer without open examination of the package, in the presence of the courier agency who was a stranger was in keeping with the normal practice specially since the package contained precious stones. The State Commission concluded that there has been pilferage of six packets containing precious stones and that as per the stipulation in the policy, the insurer had to indemnify the loss. The State Commission, therefore, Held that the repudiation of the insurance claim by the opposite party under proved circumstances of theft of precious stones arbitrarily and without valid reasons was a deficiency in service towards the complainant. In the result, the State Commission directed the opposite party to settle the complainant''s claim for Rs. 3,28,178/ - with interest at 18% p.a. from 7.12.89 till realisation and Rs. 500/ - as costs to the complainant.

IN the Appeal, the Appellant has stated that the claim had been rejected after due application of mind and after scrutinization of the terms of the policy. It has been pointed out that the packet was delivered in goods and sealed condition to the consignee who in spite of knowing the valuable contents of the packet did not bother to check whether the precious gems were in order or not. According to the Appellant, the contract of insurance terminated at the time of delivery and the taking of signature of the consignee on the official delivery receipt of the courier. Regarding the surveyor''s report, the Appellant clarified that at no stage it had disowned the findings in the report; the Appellant had only stated that since the package was opened by the consignee after the delivery had been effectuated and after the consignee had signed the delivery receipt that it was in good condition, a survey conducted thereafter was an exercise in futility.

WE have heard the Counsels on both sides and carefully gone through the records. The Counsel for the appellant relied on clause 8 of the Schedule of the terms and conditions of the policy which reads as under: "No claim will be admissible under this insurance unless parcel shows signs of having been tampered with during the course of transit and open delivery has been taken by the consignee from the post -office/airfreight office and a certificate obtained to this effect from the proper authorities. Addressee''s receipt on the form of the Postal Authorities or Airlines Authorities for the parcel with seals intact shall be proof of safe delivery." Reference was also made to Clause 2 of the policy namely: "This insurance attaches from the time the goods leave the premises of the sender and continues in the ordinary course of transit whilst carried by the sender and/or their employee and/or Customs employee and/or agents and whilst in the custody of the post office and/or Bank and/or customs and/ or all other places through which the goods have to pass in the ordinary course of transit and whilst being carried by the consignee and/or their agents and/or consignee''s employee and/or customs employee in the ordinary course of transit and terminates on delivery at the address of the consignee at destination." The consignee, K.G.K. Gems Ltd. hired Melca Amit (Thailand Ltd.), their forwarding agents, to take delivery of the consignment from Bangkok Airport on 20th October, 1989. Melca Amit (Thailand Ltd.) hired Securicor, Thailand Ltd. to make delivery of the consignment at the consignee''s premises. Securicor Thailand Ltd., took delivery of the consignment from Bangkok Airport on 20th October, 1989 at 1600 hours. Since the office of the consignee was closed for the long week end, the package was delivered by Securicor Thailand Ltd. to the consignee on 24th October, 1989. Securicor Ltd, the agent of Melca Amit when delivering the parcel to the consignee had got an official delivery receipt from the consignee saying that the packet was in good condition. The parcel was opened by the consignee after signing the receipt and after the representative of the Securicor had left. Thus according to the Appellant, with the delivery of the package in good condition at the address of the consignee at destination, the contract of insurance terminated as per Clause 2 of the policy. The Appellant further pointed out that the package was already opened by the consignee himself before the survey was conducted and that the Surveyor''s report itself had stated "we are unable to state where and when the theft had occurred".

IN the light of the aforesaid, we are of the view that under the terms and conditions of the insurance policy, the Appellant is not liable for any pilferage discovered by the respondent -complainant in the package after the consignee had acknowledged the receipt of the package in good condition at the destination. We, therefore, allow the appeal and set aside the order of the State Commission and dismiss the complaint. There is no order as to costs. Appeal allowed. ===========================================================================