National Consumer Disputes Redressal
United India Insurance Co. Ltd. vs Dhingra Rice & General Mills on 24 January, 2024
NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION NEW DELHI FIRST APPEAL NO. 1268 OF 2014 (Against the Order dated 16/09/2014 in Complaint No. 63/2011 of the State Commission Punjab) 1. UNITED INDIA INSURANCE CO. LTD. THROUGH ITS BRANCH MANAGER, BRANCH OFFICE: TARN TARAN, OPP. SSP OFFICE, AMRITSAR ROAD, TARN TARAN (PUNJAB) ...........Appellant(s) Versus 1. DHINGRA RICE & GENERAL MILLS THROUGH ITS PARTNER SH. GURINDER SINGH DHINGRA, P.O. GILWALI, NEAR SANGRANA SAHIB, TARN TARAN ROAD, AMRITSAR (PUNJAB) ...........Respondent(s)
BEFORE: HON'BLE MR. JUSTICE A. P. SAHI,PRESIDENT
FOR THE APPELLANT : MS. NANITA SHARMA, ADVOCATE FOR THE RESPONDENT : MR. S. M. TRIPATHI, ADVOCATE
MR. SANJEEV KUMAR VERMA, ADVOCATE
ALONG WITH COMPLAINANT IN PERSON
Dated : 24 January 2024 ORDER
1. This appeal has been filed by the Insurance Company questioning the order of the State Commission dated 16.09.2014, whereby the claim of the respondent/ complainant has been allowed and after making adjustments a direction has been issued to pay the sum of Rs.24,82,520/- together with 9% interest from the date of filing of the complaint till its realisation.
2. The goods that were insured were a consignment of Mustafa Brand Basmati White Sela Rice. These were three shipments, the first against the invoice bill no. 208 dated 07.10.2009 for Rs.14,03,000/-, the second against the invoice bill no. 210 dated 11.10.2009 for a sum of Rs.14,49,000/- and the third was against the invoice no. 212 dated 14.10.2009 for a cum of Rs.14,49,000/-. These consignments were admittedly insured under a Marine Cargo Open Cover Policy and all the three consignments were dispatched simultaneously under separate Marine Certificates to be shipped from Mundra Port to Dubai. It was dispatched through a transport carrier, New Malwa Kandla Transport Company, from the complainant's mill in Punjab for being collected and managed for further transportation through their clearing agent M/s. Shiv Shakti Clearing Agency at Mundra Port. The goods were collected by the clearing agent and stored in the godown of Saurashtra Containers Private Limited for clearing and forwarding the goods at CFS Zone, Adani Port, Mundra, Kutch, Gujarat.
3. Unfortunately, a fire took place on 23.10.2009 and according to the complainant the entire goods of the complainant were damaged along with goods of some other parties which were also stored in the said godown. The complainant immediately informed the Insurance Company and also lodged an FIR with the local police. The Insurance Company appointed M/s. U. C. Nahar, Surveyor and Loss Assessor, Ahmedabad for conducting a survey. The surveyor visited the spot and after collecting the information including that from the complainant, submitted a report dated 13.03.2010 for indemnification of Rs.7,97,708/- against the total loss claimed by the complainant, which was for Rs.43,01,000/-.
4. While submitting the report, the surveyor undertook an exercise of recalculating the value of the goods for which he is stated to have obtained some information from the market, contrary to the invoice price as indicated in the bills and reduced it with a further deduction on account of salvage and made its recommendations.
5. While submitting his report the surveyor has also mentioned that a sample of the rice had been sent for a laboratory report, which has been made the basis of calculating the price at a reduced rate. The surveyor opines that the laboratory report dated 19.05.2010 indicates the presence of another variety of rice as against that was claimed by the complainant to have been dispatched for being exported to Dubai.
6. On the submission of the said report the Insurance Company proceeded to settle the claim for Rs.10,77,747/- on a non-standard basis vide letter dated 15.12.2010.
7. This led to the institution of Complaint No. 63 of 2011 before the State Commission, where the Insurance Company clearly pleaded that the laboratory report indicated that the entire consignment was not as disclosed, and to be exact, the sample which was sent for analysis had a mixture of 57.4% of Basmati Rice and 42.6% of Non-Basmati Rice. The second ground taken by the Insurance Company was that there was a violation of the terms of the policy particularly clause 4 and clause 16.2. The said clauses have been quoted in paragraphs 12 and 13 of the impugned order and after considering the said argument, the State Commission came to the conclusion that the Insurance Company could not establish the violation of the terms and conditions of the policy hence the claim could not have been settled on a non-standard basis that is 75% of the total amount payable.
8. The State Commission then went on to accept the total claim and after reducing the value of the salvage amount and other deductions on account of shortage, arrived at the conclusion that the complainant was entitled to a sum of Rs.35,38,667/-. It therefore directed that after deducting the payment of Rs.10,77,747/- that had already been made to the complainant on a non-standard basis by the Insurance Company, the complainant is entitled to receive Rs.24,60,920,/- plus Rs.21,600/- that is a total of Rs.24,82,520/- together with 9% interest from the date of the filing of the complaint.
9. Aggrieved, the Insurance Company has filed this appeal and learned counsel for the Appellant, Ms. Nanita Sharma advanced her submissions to contend that the settlement letter clearly records that there has been a violation of the terms of the policy particularly clauses 4 and 16.2, in as much as, the complainant failed to comply with clause 4 by intimating the port authorities/ carrier and putting them to notice and thereby also violated clause 16.2 which requires the insured to undertake all such steps so as to preserve the rights of the insurer under the terms and conditions of the policy in order to minimise the losses. It is urged that since the complainant defaulted, the claim was settled on a non-standard basis, which does not amount to accepting any liability on the merits of the claim. To the contrary since the recovery rights of the Insurance Company were not preserved and secured by the complainant, who omitted to perform its obligation in terms of the policy, the claim was settled on non-standard basis. Learned counsel has advanced various submissions to substantiate the said position.
10. In order to appreciate the arguments of either side it would be appropriate to first mention the terms of the policy and the violation alleged. There is no dispute that under a Marine Cargo Open Cover Policy, the duration whereof was from 05.05.2009 to 04.05.2010, the goods were insured and then consignments were dispatched on separate Certificates of Marine Insurance. The insurance policy covers the risk of any loss or damage due to fire which is also not disputed. The claim was not repudiated specifically but it was settled on non-standard basis up to the extent of 75% of the net loss, which was assessed for the amount as already indicated above.
11. While settling the claim, the calculation has been made of the loss as per the assessment report of the surveyor, which also takes notice of the laboratory test report from SGS India Pvt. Ltd. that was obtained by the surveyor to reassess and recalculate the value of rice. Secondly the said letter also clearly recites that since the complainant failed to protect the recovery rights against Mundra Port, then as per guidelines, the claim was being settled on non-standard basis. This recital therefore clearly amounts to invoking the clauses for denying the entire claim of indemnity and which also has been clearly pleaded in the written version and has also been argued at length by the learned counsel for the Insurance Company, appellant. It is urged that the State Commission has completely overlooked the fact that the terms of the policy had been violated and abruptly came to the conclusion that the violation could not be established without giving any cogent reasons.
12. Learned counsel then urged that the surveyor was fully justified in segregating the loss on the strength of the laboratory test report as according to the learned counsel it was a case of partial loss, whereby the complainant had retained his right with regard to salvage and had sold it of for Rs.7,00,000/-. It is submitted that therefore this was not a case of total loss and hence the surveyor was well within his authority to have assessed the loss by segregating and analysing the extent thereof by placing reliance on the laboratory report.
13. It was also vehemently contended that the complainant fell short of its obligations by not dispatching the notice to either the Mundra Port or the carrier or the clearing agent. This has resulted in the loss to the Insurance Company, in as much as, if the said notice would have been issued by the complainant, the rights of recovery could have been protected and which is a mandatory obligation to be discharged by the complainant, which it failed to do. It is urged that even a suit cannot be filed unless the notice is served by the insured and in the absence of any such notice, no steps of recovery can be taken by the Insurance Company. Consequently, this being a gross violation, the claim was rightly settled on non-standard basis. The State Commission therefore erred in awarding the entire amount claimed, which could not have been done in the wake of the violation of the policy and also the laboratory test report that was relied on by the surveyor and has been incorrectly discarded by the State Commission. It is urged that the laboratory test report has not been successfully rebutted by the complainant and therefore the assumption by the State Commission that it could not be relied on is without any foundation.
14. Learned counsel has invited the attention of the Bench to the affidavit of the surveyor that was filed before the State Commission along with the written version in response to the affidavit filed by the complainant clearly stating that the surveyor had collected the sample of the partially damaged consignment within the knowledge of the complainant and had sent the same for analysis to M/s. SGS India Private Limited.
15. It is therefore submitted that no error was committed by the Insurance Company in settling the claim on non-standard basis. There was no error in the surveyor's report so as to discard the evidence on record and hence the impugned order deserves to be set aside.
16. Responding to the said submissions the matter was argued on previous occasions which needs reference. The objection taken by the learned counsel for the respondent/ complainant, which has been recorded in the order dated 29.08.2023 is that the report of the surveyor is dated 13.03.2010, whereas the report of the laboratory is dated 19.05.2010. This doubt had also been indicated in a previous order of this Commission dated 03.04.2019, on which the learned counsel for the appellant had taken time to seek a clarification and accordingly clarification was issued by the surveyor on 26.07.2019 to the effect that the report had already been prepared but it was issued later on because such survey reports are tendered after the fee is paid. It is indicated that before finalising the survey report the bill is raised and therefore the report had been prepared on 13.03.2010 on the same day when the survey fee bill was raised but was not dispatched to the complainant. The complainants had tendered the cheque for the survey fee but the same was returned due to insufficient funds and then later on the transaction was repeated and the report was then sent to the complainant on 19.06.2010. Thus, according to the learned counsel for the appellant, the survey report had been prepared but was not finalised and was sent to the Insurance Company after taking into account the laboratory test report dated 19.05.2010. It was dispatched to the complainant only on 19.06.2010 for which reliance is placed on the letter dated 19.06.2010, a copy whereof has been filed along with the clarification documents.
17. Coming to the journey of the consignment, there seems to be no dispute that the consignment was handed over to the carrier and it reached the port in the custody of the clearing agent for completing formalities in order to dispatch the consignment further to Dubai. It is undisputed that the said consignment along with consignment of other traders was kept in the godown of M/s. Saurashtra Containers Pvt. Ltd., through the clearing and forwarding agency, where the fire took place and the damage was caused. Thus the goods were under transit and in custody of the clearing and forwarding agent when the loss occurred.
18. Mr. Tripathi countered the submission of the learned counsel for the appellant contending that firstly the goods were not in the custody of the Mundra Port authorities and therefore there was no occasion to have given notice to the said authority. The arguments were advanced and have been noted in the order dated 15.01.2024. It is urged that the judgment relied on by the learned counsel for the appellant in the case of "Essemm Logistics Vs. Darcl Logistics Ltd. & Anr." delivered by the Apex Court is not at all attracted herein in as much as even under the Carriers Act it is only a statutory notice, which has to be given to the carrier if the goods are in its custody. He submits that there was no necessity of giving any notice to the carrier, nor there was a statutory requirement in as much as the transporter had already handed over the goods to the clearing agent and it was in the godown arranged by the clearing agent that was having the custody of the goods.
19. Mr. Tripathi then urged that even assuming that the clearing agent was also one of the bailees to whom notice ought to have been given either in the capacity of a custodian or a third party, no notice under any statute or law is required to be given to a clearing agent nor there is any requirement obligated under any law for the time being in force. He contends that in the absence of any such law regarding a clearing agent, even if no notice has been issued by the complainant, it did not take away the right of the Insurance Company to institute proceedings of recovery against the clearing agent, which could have been done either by calling for a letter of subrogation from the complainant or by filing a civil suit. He submits that the time for taking such action by the Insurance Company had not run out and the period of three years of limitation was very much available at least on the date when the settlement was made on 15.12.2010.The omission to act by the Insurance Company therefore cannot be an excuse to deny the claim of the complainant nor is there a violation of the terms of the policy.
20. He then contends that clause 4 of the policy, which requires the giving of notice may be necessary for the port authorities or the carrier which is the case set up by the Insurance Company but in the instant case the goods were in the custody of the clearing agent for whom no statutory notice was required as explained above. He therefore submits that clause 4 of the policy in no way can be read as an embargo for filing a suit or impinging upon the rights of the Insurer to recover or taking any other step by the Insurance company. It is urged that in the absence of any such legal embargo even if the complainant did not issue any notice to the clearing agent, the same cannot be a ground to deny the claim of the complainant under an alleged violation of the terms of the policy.
21. On this controversy raised by the learned counsel for the appellant, Mr. Tripathi urges that no such plea has been taken either in the written version nor is there any recital in the letter of repudiation that notice had not been sent by the complainant to the clearing agent. He submits that in the absence of any such plea the arguments on oral basis in the appeal cannot be advanced without having pleaded facts in relation thereto. Mr. Tripathi emphasized that otherwise also the Insurance Company cannot travel beyond the reasons specified in the letter of repudiation and he relies on the following judgments of the of the Apex Court:
1." Glada Power & Telecommunication Ltd. Vs. Unite India Insurance Co. Ltd., (2016) 14 SCC 161, Paragraph 18",
2. "Saurashtra Chemicals Limited Vs. National Insurance Company Limited, (2019) 19 SCC 7, Paragraph 23" and
3. "New India Assurance Co. Ltd. & Ors. Vs. Mudit Roadways, 2023 SCC OnLine 1532, Paragraphs 34 and 35".
22. Before setting out to examine the facts and in order to appreciate the arguments on behalf of the appellant clause 4 of the Marine Cargo Open Cover Policy, which requires the sending of a notice as argued above is reproduced herein under for ready reference:
"4. To give notice in writing to the Carriers or other Bailees within 3 days of delivery if the loss or damage was not apparent at the time of taking delivery."
23. Apart from this the general terms and conditions which requires the insured to take proper steps under the policy for preserving the rights of the insurer under clause 16.2, is extracted herein under:
"16.2 to ensure that all rights against carriers, bailees or other third parties are properly preserved and exercised and the Underwriters will, in addition to any loss recoverable hereunder, reimburse the Assured for any charges properly and reasonably incurred in pursuance of these duties."
24. In the instant case the complainant has not issued any notice either under the Marine Insurance Act or the Carriers Act, to the Mundra Port authorities or the carrier. The settlement letter therefore needs to be referred to as the recital therein has to be taken into account before proceeding further, which is necessary in view of the pronouncements of the Apex Court in the cases of Glada Power & Telecommunication Ltd.(Supra), Saurashtra Chemicals Limited (Supra) and "New India Assurance Co. Ltd. (Supra). All the three judgments clearly rule that the Insurance Company cannot travel beyond the reasons that are recorded in the letter of repudiation. In the instant case the letter dated 15.12.2010, even though is a letter of approval of the claim which consequentially is a settlement on non-standard basis, it simultaneously does not accept the entire claim of the complainant which stands partially repudiated by placing reliance on the report of the surveyor, a laboratory test report and then by clearly indicating that since the recovery rights against the Mundra Port was not protected by the complainant as per guidelines, the claim was being settled on a non-standard basis. Hence, the action of the Insurance Company has to be assessed on the basis of the said letter of settlement, which partially repudiated the claim of the complainant. The citations therefore noted above would apply on the said settlement letter, which simultaneously repudiates part of the claim of the complainant on the reasons set out therein. The said settlement letter is extracted herein under for ready reference:
"Dt. 15.12.2010 Dhingra Rice & General Mills VPO Sangrana Sahib, Distt. Amritsar SUB: Approval of your Marine Claim under GR No.3428, 3435, 2337 Under Policy Nos. 200305/21/09/10/70000065, 66 & 68 Dear Sir, With reference to the claim lodged by you for Fire incident took place on 23/10/09 at Mundra Port and after completion of formalities by you on 22/10/10, we have pleasure to inform you that the competent authority has approved your claim for Rs.10,77,747/- and we are enclosing herewith discharge voucher in triplicate for your signature and returning the same to us for release of payment.
The details of calculation is as under:
As per assessment report of surveyor Mr. U. C. Nahar (copy already lying with you) he has assessed the loss as under:
As per SGS Laboratory Test Report, obtained by above surveyor, the rate is arrived as under:
1121 Basmati Rice 57.4% @ 3800 = 2181.20 Non Basmati 42.6% @ 3200 = 1363.20 _____________________ TOTAL: 3544.40 Mkt. value of the rice = Rs.3544.4 per qtl. Rate of salvage realization as per offer dt. 15.6.10 = Rs.2211.0 per qtl. Difference in above Rs.1333.40 per qtl. Percentage of loss comes to Rs.1333.40/3544.40 = 37.62% This %age is applied on 68000 kgs of consignment Value of Rs.42,38,667 x 37.62% = Rs.15,94,587 Balance 1000 kgs fully burnt @ 62.33 = 62,333 Gross Loss Assessed by surveyor Rs.16,56,920 Less 15%, as salvage retained by insured for =(-) 2,48,538 Better realization Net Loss Rs.14,08,382
Since the recovery rights against the Mundra Post was not protected by you or your representatives, so as per guidelines, claim is settled on non-standard basis for which maximum approval upto the extent of 75% of Net Loss assessed i.e. Rs.14,08,382 can be given.
75% of net loss payable (14,08,382 x 75%) = Rs.10,56,287 Add Survey fee paid = 21,460 Total Rs.10,77,747 We hope that the above will suffice your purpose. With regards, Yours truly, For United India Insurance Co. Ltd. Sd/- (Branch Manager)"
25. The said stand of the Insurance company has been supplemented by the arguments of the learned counsel for the appellant, on the basis of the stand already taken in the written version of the Insurance Company before the State Commission. In paragraph 6 (i) the following statement has been made in addition to other averments. The same is extracted herein under:
" 6 (i) ...............It is submitted that the complainant was under duty under the terms and conditions of the policy to safe guard the recovery right of the opposite party against the carrier / port authority or other 3rd party. The Complainant was supposed to give statutory notice to the port authority so as to secure the right of recovery against the port authorities, the Complainant had not given the said statutory notice to the concerned authority. Therefore, it was a case of breach of policy condition. The opposite party could even repudiate the claim for the said breach of policy condition. However following the guidelines for settlement of said claim, the opposite party decided to pay 75% of the assessed claim which can be paid in case of such a breach by opposite party. Thus for that reason 75% of the assessed loss of Rs.14,08,382/- was paid to the Complainant...................................."
26. A perusal of the aforesaid averments made in the written version therefore reflects on the stand taken by the Insurance Company to support the settlement dated 15.12.2022, on the ground that the complainant was under a duty to give statutory notice to the port authorities to secure their right of recovery. While making the settlement the same has also been clarified by contending that such a notice was required in order to preserve the right of recovery against the carrier. The obligation is to the effect that had a notice been given to the port authorities, the same could have preserved the right of recovery against the carrier, who according to the learned counsel for the Insurance Company had transported the goods.
27. The fact of the custody of the goods therefore comes first in order to determine as to whether such a notice was sent or required to be sent in order to preserve the rights of recovery in favour of the Insurance Company. The entire journey of the goods up to the stage of reaching the godown has not been disputed. The goods were entrusted to the carrier, who delivered it safely and intact to the clearing agent, who in turn stored the said goods in its pristine condition inside the godown of M/s. Saurashtra Containers Private Limited. The custody therefore had passed on from the carrier to the clearing agent, who lodged it in the godown of M/s. Saurashtra Containers Private Limited at the Mundra Port. The goods therefore were not in the custody of Mundra Port authorities merely because the godown of a clearing agent was located there. The custody was passed on by the carrier to the clearing agent, who stored it in the godown of M/s Saurashtra Containers Pvt. Ltd. for clearing and forwarding as well as other handling purposes. The fire took place in such custody inside the said godown and it was not a loss or damage either in the hands of the carrier or the port authorities.
28. Learned counsel Mr. S. M. Tripathi, is therefore correct in his submission that had the loss occurred in their hands, the statutory notice was required to be given by the complainant to the port authorities or to the carrier. His contention therefore is correct that since the goods were not in the custody of either the port authorities or the carrier, then in that event there is no legal requirement for issuance of any such notice under any statute to the port authorities or the carrier. It is therefore apparent that had the loss or damage occurred in the custody of the port authorities or the carrier, there would have been a necessity of compliance of the statutory notices, but in the instant case the goods were stored in the custody of the clearing and forwarding agent at the godown of M/s. Saurashtra Containers Private Limited. In this view of the matter, I do not find any such lapse on the part of the complainant to have not given notice to the port authorities or the carrier as he was not required in the absence of any custody of the goods with the port authorities or the carrier.
29. Coming to the issuance of any notice to any other bailee as per clause 4 or third party, assuming that such a notice under the terms of the policy, and not a statutory notice, was required to be given to the clearing and forwarding agent, then too not sending such a notice is not a violation of any law. The terms of the policy are the terms of contract. It is only when a statutory notice is not given, that the right to sue does not survive and it is for this reason that such action is necessary in respect of the port authority or the carrier.
30. However, the same position of law will not apply in the case of a clearing and forwarding agent, who is not required to be put to notice under any statute, even though the notice according to the terms and conditions of the policy is required to be sent to any bailee or third party, in the definition whereof the clearing and forwarding agent, M/s. Shiv Shakti Clearing Agency would qualify as a bailee. Thus, even if notice was to be given to the said clearing agent under the policy and such a notice was not given by the complainant, then it is not a statutory default so as to prevent the filing of a suit or taking any step through subrogation by the Insurance Company for setting up a claim of recovery against the clearing agent. Mr. Tripathi is correct in his submission that the right to sue, where statutory notice is not mandatory and is only under the terms of the policy, is not prohibited and can be availed of within the period of limitation as prescribed under law, which in the present case was very much available on the date of the settlement of the claim. The omission of the Insurance Company by not taking any such steps does not entitle it to deny the claim of the complainant on the ground of violation of the policy.
31. What is more important and is borne out from the facts is that no such recital is contained in the letter of settlement about any notice not been given by the complainant to the clearing agent. The written version alleges default of not giving notice to the port authorities or the carrier of third parties but not the clearing agent in whose godown the accident took place. Thus, the Insurance Company cannot be permitted to raise such a plea at this stage of appeal through oral arguments, of notice not been given to the clearing agent in whose custody admittedly the goods were lost in fire. The contention therefore of the learned counsel for the Insurance Company that the recovery rights were lost as they were not preserved as per guidelines is not sustainable for all the aforesaid reasons. The repudiation letter as well as the stand taken by the Insurance Company therefore proceeds on an incorrect assumption of fact as well as law. The arguments developed at the stage of appeal without there being any specific mention or pleading against the clearing agent therefore is unacceptable.
32. Having held so it is further necessary to analyze the stand of the Insurance Company in assessing the loss on non-standard basis. The fact with regard to the laboratory report also raises serious doubts inasmuch as the explanation given for the same being mentioned in the report of the surveyor, even though prepared later on as pointed in Paragraph 17 hereinabove has not been explained appropriately. The contention raised by the learned Counsel for the Insurance Company with the aid of clarification made by the surveyor cannot be countenanced on the ground that he had incorporated the laboratory report which is dated 19.05.2010 in his report which is dated 13.03.2010. A report which emanated later on and its mention being made in a survey report of a prior date raises not only a doubt but a grave suspicion of the manner in which the surveyor has set up his explanation. In this regard the Insurance Regulatory and Development Authority of India (Insurance Surveyors and Loss Assessors) Regulations 2000 are relevant. The surveyor is supposed to tender his report under the regulations prescribing duties and responsibilities according to which he has to assess the loss after inquiring, investigating and verifying upon the cause and circumstances of the loss. In the instant case, the laboratory test report is 19.05.2010 whereas the said report has been mentioned in the surveyor's report which is dated 13.03.2010. This sort of functioning by the surveyor confirms the perfunctory manner in which the surveyor has drafted and presented his report. He may have sent a copy of the same to the Complainant on 19.06.2010 but he should have taken care to have corrected his dates even if he was sending a previously prepared report. As a matter of fact, a surveyor in the absence of any relevant document is entitled to submit his report independently on the available documents, and then if he finds that it is incomplete, the Insurer/Insurance Company can call upon it to make good the said deficit by furnishing an additional report. The explanation given by the surveyor in this regard therefore does not inspire confidence and the report has been prepared in a manner which is not in accordance with the regulations.
33. The second aspect of the matter about the said laboratory report is that it clearly recites that the sample of the rice tested was received in an unsealed container. This fact also casts a doubt on the manner in which the sample was sent and the report obtained. In this regard, it is relevant to mention that the surveyor has found in his report that on the date of the accident the goods of other rice traders apart from the complainant had also been stored and were destroyed. The Complainant contends the there is a possibility of a different rice being mixed in the sample which was collected by the surveyor and which was done behind his back and without any information. Even though the surveyor has filed an affidavit stating that it was within the knowledge of the Complainant, no evidence is available on record to demonstrate that the Complainant was ever informed or called upon or even associated with the sampling or its sending for a report from any laboratory. This entire exercise appears to have been done unilaterally by the surveyor and hence any finding recorded on the basis of such a mixed sample could not have been made the basis for assessing the value of the rice which was supplied and transported and stored in the godown on the date of the incident that belonged to the Complainant. It is quite probable that the surveyor may have sent a salvaged sample of the rice which could have been mixed up in the fire that took place destroying the goods on a heavy scale and hence collecting of the sample or sending it without any supporting evidence in respect thereof casts not only a doubt but makes this entire exercise uncredit-worthy. The surveyor was therefore not correct in proceeding to fix the price of the rice on the basis of such an unreliable laboratory report or sampling attempted by him. Apart from this the survey report indicates that some information was received from the market by the surveyor about the prevailing price of the quality of rice that is stated to have been lost. The surveyor mentions the name of Sugandha Basmati Rice. The Complainant seems to have been completely kept in the dark about any such information received or the comparison of the quality of rice from open market for refixing of this price. It is not disclosed as to what was the exact source of this information relied on by the surveyor. This attempt of the surveyor was also therefore imaginary and is not founded on any cogent material. The assessment therefore made by him is a complete guess work which cannot be believed.
34. Over and above this the argument raised by Mr. Tripathi deserves to be accepted that it is only the value of the goods disclosed in the invoice which were subjected to complete loss that could have been taken into account. He submits that the stand taken by the learned Counsel for the Insurance Company that there was partial loss and therefore the assessment could have been made by the surveyor is not correct and he has relied on the standard practices in this regard to contend that the nature of the loss was total and not partial. He submits that whatever salvage was recovered was not consumable rice but part of the destroyed rice. Thus the loss was not partial but was complete. He therefore submits that such an argument cannot be accepted and even the settlement letter does not hold that the loss was partial. He submits that the letter simply reproduces the assessment report of the surveyor on calculation without recording as to whether the loss was partial or complete. The Insurance Company according to him therefore has overlooked this aspect of the matter. I am inclined to agree with the submission of Mr. Tripathi inasmuch as it is only the case of partial loss that an assessor or an investigator is required to segregate the saved goods from the lost goods in order to calculate the loss, but where the loss is complete then in that event the surveyor has to go by the invoices indicating the price of the goods mentioned therein to be received by the insured on its sale. The invoices that have been tendered by the Complainant with regard to the value of the goods have nowhere been doubted nor is it the case of the Insurance Company or the surveyor that the quality of rice or its price as reflected in the invoice was fake. To the Contrary, in order to contradict the same reliance has been placed on the laboratory test report which as indicated above is not at all credit-worthy. The splitting of the quality of Basmati Rice and non-Basmati Rice attempted by the surveyor is neither grounded on believable facts or evidence nor has the surveyor been able to establish the same. Thus, the value of goods shown in the invoices cannot be discarded and the loss assessed by the surveyor reducing the price of the rice based on uncredit-worthy evidence therefore is liable to be rejected. The reliance placed by the Insurance Company in the letter of settlement on such assessment is therefore founded on incorrect assumptions of facts which were neither probable nor did possibly exist.
35 Accordingly, the entire claim of the Complainant ought to have been allowed by the Insurance Company and should not have been settled on a non-standard basis. Consequently, the findings recorded by the State Commission in addition to what has been stated above does not require any interference and the appeal is accordingly dismissed. The impugned order of the State Commission dated 16.09.2014 is hereby affirmed.
.........................J A. P. SAHI PRESIDENT