UNITED INDIA INSURANCE COMPANY vs Vindhya Soya Ltd.

THIS is an appeal under Section 15 of the Consumer Protection Act, 1986 (for short the ''Act''), against the order dated 5.2.1999 passed in Case No. 15/94 by the District Consumer Disputes Redressal Forum, Hoshangabad (for short the ''District Forum'').

THE respondent No. 1 is a registered Company having its Soya Oil Industry at Itarsi. THE respondent No. 1 after taking Marine Policy transported 12:005 metric ton Soya Oil by tanker No. NKC 8323 of the respondent No. 2 - the Carrier on 30.12.1990 to be delivered at Kanpur (Dehat). During transit the tanker to save an accident with a bullock-cart overturned near Begam Ganj as a result of which 7:800 metric ton oil alleged to have fallen on the Kaccha road and fields. THE driver of the tanker lodged a report at Police Station Begum Ganj. THE respondent No. 1 lodged a claim with the Insurance Company. THE respondent No. 1 averred that undamaged oil weighing 4:280 metric ton in the tanker was transhipped to the other tanker while 7:700 metric ton out of 12:005 metric ton was damaged. THE total loss was Rs. 1,97,925/- at the rate of Rs. 25,375/- per metric ton was claimed. THE Insurance Company appointed Surveyor, V.N. Sarin & Company who vide report dated 22.4.1991 (Ex. D4) assessed the net loss of Rs. 66,245/-. THE Insurance Company did not take final decision for long. Lastly, vide letter dated 25.10.1994 Ex. D/9 the claim was repudiated. THE respondent No. 1 filed the complaint on 17.12.1993 against the Insurance Company and the Carrier. THE complaint was resisted. THE District Forum after appreciation of evidence adduced by the parties dismissed the complaint against the Carrier, the respondent No. 2 as barred by time while the complaint against the Insurance Company because of repudiation of the claim on 25.10.1994, which gave cause of action. On the oral and documentary evidence adduced by the parties, a finding of deficiency in service was recorded. THE report of the Surveyor stating therein that 5:114 metric ton oil was transhipped in another tanker was disbelieved and damaged quantity of oil was to be of 7:800 metric ton, therefore, District Forum ordered to pay Rs. 1,97,925/- cost of the oil of 7:800 metric ton and to pay interest on the amount of Rs. 1,97,925/- at the rate of 12% p.a. from 1st August, 1991 with Rs. 1,000/- as costs of the proceedings. It may be stated here that the procedure for enquiry of the complaint on receipt of the complaint is prescribed in Section 13 of the Act. A bare look to Section 13 of the Act would show that where a case of deficiency in service involved determination of complex questions of fact and law, which cannot be satisfactorily determined by the Redressal Agencies in summary jurisdiction in the time frame prescribed under the Rules, it would be better for the complainant to seek redress of his grievance in a Civil Court. The record of the case shows that the District Forum held an elaborate enquiry and recorded evidence of the parties on the complex issues, in summary jurisdiction where the evidence is received by affidavits.

The driver of the tanker, Arun Kumar Rathore lodged a report Ex. P3 at the Police Station Begam Ganj of the accident stating therein that due to accident the tanker was damaged and small quantity of oil fell on the ground. True, First Information Report is not a substantive piece of evidence, but the same has been relied by the respondent No. 1 to prove the accident and loss. In case, the respondent No. 1 wanted to challenge the correctness of the report, it was the duty of the respondent No. 1 to examine the driver, the maker of the FIR. The District Forum with an erroneous approach overlooking the law in our opinion illegally held that the driver to save himself and the owner of the tanker wrongly held that the loss of the oil was of small quantity while the loss was much more.

IT is well-known that a man may tell lie, but the circumstances do not. The photographs are on record. Admittedly, the accidented tanker was brought in its position, after that the left over oil was transhipped in another tanker. The lid of the tank as well as valves of the tank were intact and were in sound condition. Therefore, there was no possibility of leaking and falling of the oil on the land in so much of the quantity, as the place of accident was not wet or full of oil but was dry. All these circumstances rules out the possibility of damage of the oil in the quantity as alleged by the respondent No. 1. The Surveyor has made enquiries from the farmers and one of the representatives of the respondent No. 1 who stated that 5:114 metric ton oil was transhipped by the respondent No. 1 before the survey. True, the Surveyor has not given the names of the persons, who gave such information, but for that reason only the survey report cannot be discarded, in the absence of the examination of the driver and labourers who transhipped the left over oil in another tanker. The respondent No. 1 examined the Manager, Mr. Girija Shanker Sharma who admitted that at the time of survey their representative also went whose name he cannot tell without seeing the record. The respondent No. 1 did not examine this representative who was the best witness to state that he did not inform the Surveyor that 5:114 metric ton oil was transhipped. The evidence of the weighing clerk who was not at the spot cannot be given any weight in the absence of material evidence which gives rise to an adverse inference against the respondent No. 1. Besides, the respondent No. 1 did not institute the suit or taken any action to realise the amount from the Carrier under the Carriers Act, which could not have saved its liability merely on the ground that the consignment of oil to be transported was insured and no liability would come on the Carrier for any loss. In any case the respondent No. 1 could have filed the complaint under Section 12 of the Act, against the Carrier and the Insurance Company within the prescribed period of the limitation Act, but, for the reasons best known to the respondent No. 1, the complaint was filed after expiry of the period of limitation against the Carrier. Thus, the respondent No. 1 did not take any action to minimise the losses, which is a breach of the condition of the policy. For inaction of the respondent No. 1 against the Carrier, the Insurance Company has been deprived of its right to recover the amount from the Carrier which the Insurance Company has to pay to the respondent No. 1 in terms of transit policy.

IN view of the above, the submission of appellant placing reliance on the decision of the National Commission in Vishal Roadways v. Economic Traders (Gujarat) Ltd., III (1998) CPJ 9 (NC)=1998 (3) CPR 28 (NC), and Shri Ganesh Spinners v. United INdia INsurance Co. Ltd., III (1996) CPJ 183 (NC), in the circumstances of the case that if the respondent No. 1 was dissatisfied with the assessment of Rs. 66,254/- which according to the respondent No. 1 was inadequate, the District Forum ought to have directed the respondent No. 1 to take recourse through arbitration proceedings in terms and conditions of the policy has got a force. As to interest : True, the Insurance Company has taken long time in taking a final decision after receipt of the survey report, but, for that the respondent No. 1 would not have slept over his rights. Atleast, the respondent No. 1 ought to have instituted the suit under the Carriers Act to recover the loss from the Carrier or have taken steps to minimise the losses. The complaint so filed is not after the final decision of the Insurance Company of repudiation of the claim, but, the same has been filed prior to the date of taking final decision, which could have also been filed earlier within a reasonable time from the date of receipt of Surveyor report at least within the period of limitation prescribed under Section 24A of the Act. Besides, the complaint filed in the year 1993 was decided by the District Forum on 5.2.1999 of which appeal filed came up for hearing in March, 2001 the delay so caused in disposal of the complaint and the appeal cannot be attributed to the Insurance Company who cannot be burdened with the interest of the long period from 1991 to 2001. To say so we take the support of the decision of the Madhya Pradesh High Court in case of Oriental Fire and General Insurance Co. Ltd. v. Ram Singh & Ors., 1995 JLJ 342. In the circumstances, the ends of justice would meet if the interest is ordered to be paid at the rate of 6% p.a. on the amount of Rs. 66,254/- after the expiry of the period of three months from the date of Surveyor report. In view of the above, we direct the Insurance Company to pay Rs. 66,254/- with interest thereon at the rate of 6% p.a. from 23.7.1991 along with Rs. 1,000/- the costs awarded by the District Forum within a period of two months from the date of receipt of certified copy of this order failing which the interest shall be payable at the rate of 9% p.a., ofcourse after execution of the necessary documents in favour of the Insurance Company. The respondent No. 1 if is dissatisfied with the quantum and if the right is available, shall be at liberty to take recourse of proceedings of the arbitration in accordance with the conditions of the policy or may institute the civil suit in the Court of competent jurisdiction. If the respondent No. 1 chooses to file a suit for the relief claimed in these proceedings, the respondent No. 1 according to law, in such a case can claim the benefit of Section 14 of the Limitation Act to exclude the period spent in prosecuting the proceedings under the Consumer Protection Act, while computing the period of limitation prescribed for such a suit.

IN the result, the appeal is partly allowed. The order of the District Forum shall stand modified as indicated hereinabove. IN the circumstances of the case, parties to bear their own costs of this appeal. A copy of this order be conveyed to the parties and a copy be sent to the District Forum along with the record of the case. Appeal partly allowed.