Madras High Court
M/S. Opg Energy (P) Ltd vs M/S. Cholamandalam Ms General ... on 11 August, 2018
Author: C.V.Karthikeyan
Bench: C.V.Karthikeyan
IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED : 11.08.2018 CORAM THE HONOURABLE MR. JUSTICE C.V.KARTHIKEYAN C.S.No. 719 of 2013 M/s. OPG Energy (P) Ltd., Rep. By its General Manager No.167, St. Marry's Road Alwarpet, Chennai -18. ... Plaintiff Vs. 1. M/s. Cholamandalam MS General Insurance Co. Ltd., Rep. By its Regional Manager Rashmi Towers, 2nd Floor, No.1, Village Road, Nungambakkam Chennai-34. 2. M/s. Cholamandalam MS General Insurance Co. Ltd., Rep., by its Vice-President & HOC-Claims 2nd Floor, Dare House No.2, NSC Bose Road, Chennai -1. ... Defendants PRAYER: This Civil Suit filed under Order IV Rule 1 O.S. Rules read with Order VII Rule 1 CPC, praying for a Judgement and Decree of: (a) to pay to the plaintiff a sum of Rs.2,43,95,712/- as compensation with interest 12% per annum on Rs.2,17,30,850/- from the date of plaint till realization of the amount; (b) to pay the cost. *** For Plaintiff : Mr. P.S.Raman Senior Counsel For DD 1 & 2 : Mr.N.Vijayaraghavan JUDGMENT
The plaintiff is a private limited Company incorporated under the Indian Companies Act 1956 having its registered office within the jurisdiction of this Court at Chennai. It had a factory at Bap Village, Jodhpur District, Rajasthan.
2. Though there are two defendants, in effect the defendant is M/s. Cholamandalam MS General Insurance Company Ltd., represented by its Regional Manager and shown as the first defendant and represented by the Vice President and HOC - Claims shown as the second defendant. The plaintiff is in the business of manufacturing and generating Solar Energy and supplying power to its customers which included Central and State Government undertakings. The plaintiff had taken Marine Insurance Policy from the defendants for import of Solar panels, equipments, indigenous machineries and transporting the same to the project site at Rajasthan. The policy was in effect for one year from 10.05.2011 to 09.05.2012. The sum insured was Rs.45 crores. The plaintiff paid a premium of Rs.2,02,500/-. The plaintiff claimed that the goods have to be imported with ocean, transit cover and also rail/road cover.
3. It was specifically stated that tail end transits are covered from the date of commencement of the risk and that there is no need for a separate agreement for tail end transit because the police taken is a open policy which is valid for one year.
4. The obligation of the plaintiff was to make declaration to the defendant with respect to each and every consignment received. Even if any consignment is left out, if the plaintiff sends declaration with letter intimation and if the consignment had been received within the period of one year between 10.05.2011 to 09.05.2012, any claim should be covered by the Insurance Policy. This benefit is available only in a open policy.
5. The plaintiff imported from Rotterdam Port to Nhava Sheva Port, India by Ocean and from Yantain Port in China to Nhava Sheva Port, solar panels under invoices which raised from June 2011 to September 2011. The details of the invoices are given below:-
S.No. Date Invoice No. Amount USD
1. 12.06.2011 VTI/OPG/2011/006 384,000.00
2. 21.06.2011 VTI/OPG/2011/007 288,000.00
3. 12.08.2011 VTI/OPG/2011/008 1605120.00
4. 18.08.2011 VTI/OPG/2011/009 1302592.00
5. 26.08.2011 VTI/OPG/2011/010 614295.00
6. 9.09.2011 VTI/OPG/2011/011 1416937.00
7. 09.09.2011 VTI/OPG/2011/012 1167360.00
8. 21.09.2011 VTI/OPG/2011/015 381645.00
9. 30.09.2011 VTI/OPG/2011/015 638800.00
6. The total value of the solar panels imported from Yentian Chian to Nhava Sheva, India was USD 384,000. The total value of the solar panels shifted on boat from the same place under other invoice was USD 288,000. There was a further invoice amounting to USD 1605120.00. The plaintiff claims that they had paid the invoice value to the seller and had acquired title to the goods. The value of the Cargo mentioned in the invoices were also declared to the defendants. The consignment in the containers were thoroughly inspected with respect to the packing and the plaintiff specifically stated that the custom authorities at the port of loading were satisfied about the packing condition. The captain also inspected the Cargo insider the container and affixed the signature on the bill of lading which insured sound condition. He also confirmed the value given in the invoice. The plaintiff claims that the packing was perfect and was in sound condition at the time of shipping the Cargo. Even after the goods arrived at Nheva Sheva Port and Pipavav Port, prior to loading of the goods into trucks, lorries and before leaving them to the project site at Rajasthan, the panel of the plaintiff had thoroughly inspected the external condition of the goods. They were found to be in sound condition and there were no visible damages at the port of discharge. The concerned Official at the port of discharge also confirmed the same.
7. The containers were transported by trucks from the port to the project site at Rajasthan at BAP Village. The transportation start from first weeks of August and they were received one by one till the second week of October 2011. They were destuffed and kept in the open yard. The project Manager opened the containers and took the boxes from inside and on opening of the boxes noticed that the insured goods, namely, solar panels were in damaged condition. Information was immediately transmitting to the defendants' Company. A surveyor was appointed on 14.10.2011 to carry out preliminary survey. The surveyor confirming damage to the solar panels.
8. The defendants appointed another surveyor to assess the damage. He visited the project site and conducted survey on 04.11.2011. He found that an external packing appear to be in a sound condition and there were no visible signs of damage. He attributed the damage to the jerks and jolts during transit. He surmised that solar panels would have been discharged from the groove in the boxes and collided with each other and sustained damage. He estimated the damage at Rs.2,17,30,850/-.
9. The plaintiff wrote a letter dated 25.01.2013 asking settlement of the claim. There was no response from the defendants. Another letter was written on 18.02.2013. The second defendant repudiated the claim by letter dated 22.02.3013. They raised four issues, namely, delay in intimation, improper packing, coverage and tail end transit. There were further exchanges or communications between the plaintiff and the defendants, but since the defendants did not accept to revise the decision taken to repudiate the claim, the plaintiff had instituted the suit as stated above seeking a Judgment and Decree for Rs.2,43,95,712/- together with interest and costs.
10. Along with the plaint, the plaintiff filed a copy of the Original Marine Cargo Open Policy, the Bills of lading, the commercial invoices, a copy of the survey report and the letter repudiating the claim from the defendants and other correspondences between them and the defendants.
11. The defendants entered appearance and filed their written statement. They stated that it was a fact that the plaintiff had availed Marine Cargo Open Policy for import of solar panels. The policy specifically excluded tail end transits unless written agreement is taken as to the rate and other terms prior to the commencement of each such transit. The defendants stated that the plaintiff had lodged a claim in October 2011. On receipt of such claim, the defendants appointed a surveyor on 12.10.2011 to carry out preliminary survey. A report dated 19.10.2011 was also submitted to the defendants. The surveyor stated that the solar panels were packed in wooden crates made of planks and each contained 64 numbers. They were placed on either cardboard or rubber groove strips having a height of 1" to 1.25 inches".
12. It was specifically stated by the defendants that if the packing had been done taking into consideration the Indian road conditions and with a higher groove of 4" to 5" inches with proper stuffing of gaps, the loss could have been averted.
13. Be that as it may, to continue with the pleadings in the written statement, it transpires that the defendants appointed another surveyor to assess the loss and to estimate the damage caused to the insured fixed. The surveyor visited and conducted survey on 04.11.2011. A preliminary loss Report dated 07.11.2011 was given and a final survey report dated 02.10.2012 had been furnished. It had been stated by the defendants that the surveyor had stated that vital documents had not been submitted by the plaintiff.
14. In the written statement, it had been further stated that the exact date of receipt of consignment at the project site was not provided by the plaintiff. According to the defendants, the plaintiff stated that the consignments were received during August - November 2011. The claim intimation had been sent on 10.10.2011. It had been further stated that a compliance report regarding pre-despatch survey had not been furnished by the plaintiff. It had been further stated that only one consignment was unloaded at Mundra Port. The rest of the consignments were received at Nhava Sheva or Pipavov Port.
15. The defendants claimed that they repudiated the claim on valid grounds. According to them, there was a delay in intimation of damage, there was improper packing, there was no coverage with respect to the goods off loaded at Nhava Sheva Port or Pipavav Port and documents were not produced relating to pre-despatch inspection. The defendants also denied each one of the allegations raised by the plaintiff and had also questioned the amount claimed. The defendants claimed that there was no cause of action for the suit and that the suit should be dismissed with costs.
16. On consideration of the pleadings, this Court had framed the following issues:-
1. Whether there is valid contract of insurance on the date of accident?;
2. Whether Insurance policy covers inland transit (Rail or Road) All Risk along with ocean transit till project site at Rajasthan?;
3. Whether there is violation of terms and conditions of insurance policy?;
4. Whether the findings in the survey report justify and warrant the denial of the claim?;
5. Whether the repudiation of claim is justified?;
6. Whether the assessment of Loss assessed by the surveyor at Rs.1,18,01,121/- is the actual loss suffered by the plaintiff and binding on the plaintiff?; and
7. To what other reliefs, the parties are entitled to?
17. The plaintiff and the defendants were invited to adduce oral and documentary evidence to substantiate their stand taken in the pleadings.
18. The plaintiff examined S.Gopalakrishnan, General Manager as PW-1 and Dthey marked Exs. P-1 to P-14. Ex.P-7 is the survey report given by M/s. Mehta & Padamsey (P) Ltd., with respect to the finl assessment of loss. On the side of the defendants, A.K.Balaji, Senior Manager was examiend as DW-1 and he marked Exs. D-1 to D-8. Ex. D-3 is the preliminary loss report of the surveyor dated 07.11.2011 and Ex.D-4 was the addendum survey report of the surveyor dated 02.07.2012.
19. Heard the arguments advanced by Mr.P.S.Raman, learned Senior Counsel for Mr.K.Ramaswamy, learned counsel for the plaintiff and Mr.N.Vijayaraghavan, learned counsel for the defendant.
20. Mr.P.S.Raman, took the Court through the pleadings in the case. He pointed out that the plaintiff had taken out a Marine Cargo Open Policy No. 0008426-000-00 from the defendant for import of solar panels from anywhere in the world to the project site at Rajasthan. The insurance was for the period 10.05.2011 to 09.05.2012. The sum insured was Rs.45/- Crores. The plaintiff had paid a premium of Rs.2,02,500/-. The learned Senior counsel stated that tail end transit was also covered from the date of commencement of the risk and there was no separate agreement for tail end transit since it was an open policy valid for one year.
21. The learned Senior counsel pointed out that the plaintiff had imported from Rotterdam Port, to Nhava Sheva Port, India by ocean and from Yantian port in China to Nhava Sheva Port in India under various bills of lading. The policy covered inland transit. The products were solar panels. The solar panels suffered damaged during tansit. The plaintiff had laid a claim seeking compensation for such damage. The transportation by trucks from Nhava Sheva Port to the project site at Rajasthan commenced from the first week of August 2011. The containers were received by one by one. They were destuffed in October 2011 and stored in the open yard of the project. Thereafter the boxes were taken from the containers and opened. It was only at that point of time that it was found that the solar panels in the boxes were damaged. Immediately on 10.10.2011, the fact of loss by damage was intimated to the defendants. They appointed a surveyor on 14.10.2011 to carry out preliminary survey. The learned Senior Counsel pointed out that it is not the case of the defendants that there was suppression of vital information or that there was mala fide in the intimation of loss. The onus then shifted on to the defendants to either consider the claim favourably or to repudiate the claim. However, they repudiated the claim only by letter dated 22.02.2013. The delay in repudiating the claim was entirely caused by the plaintiff.
22. The learned Senior Counsel argued that the claim of the defendants that there was a delay in intimation of loss and that there was improper packing and that there was no proper predespatch inspection cannot withstand legal scrutiny since evidence and documents have been produced to show that there was no delay in intimation, that packing was in accordance with the terms of the insurance policy wherein no specific guidelines for packing were given and pre-despatch inspection had not revealed any damage to the packing.
23. The other contentions raised by the defendants that there was no tail end insurance policy was also challenged, the learned Senior Counsel who stated that the policy itself was open end policy and was effective from the place of discharge to the place of final destination, namely, factory site at Rajasthan. The learned Senior Counsel stated that before transportation, there should be an inspection and this was done. The plaintiff can only comply with the requirements and the breach should be foundamental in nature to repudiate the contract. The learned Senior Counsel stated that the loss had been valued only on the basis of invoices and consequently, reiterated that the suit should be decreed with costs.
24. Mr.N.Vijayaraghavan, the learned counsel for the defendants however disputed the assertions made by Mr.P.S.Raman, learned Senior Counsel for the plaintiff.
25. Mr.N.Vijayaraghavan pointed out that the delay in intimation seriously prejudiced the defendants since they could not recover the amounts from the carriers. The learned counsel also stated that the packing was improper and there was no coverage under the policy and also stressed on the fact that there was no tail end transit policy. The learned Counsel stated that the damage to the goods was intimated only October 2011. However, the plaintiff had started to receive the containers much earlier and this delay consequently affected the claim that the defendants could have laid on that transporter / carrier. The learned counsel pointed out the survey report wherein the surveyor had opined that if the solar panels had been packed with a gap of 4 to 5 inches, then, the damages might not have occurred. The learned counsel also challenged the predespatch inspection report and stated it was done as a matter of routine and was not properly done as required under procedure. The learned counsel was emphatic on the fact that unless specifically mentioned, the tail end transit policy was not available and benefit should not be granted to the plaintiff. The learned counsel asserted that the suit should be dismissed.
26. I have carefully considered the arguments advanced and the pleadings and also the oral and documentary evidence adduced in this case.
Issue No.1:
27. The suit had been filed by the plaintiff on the strength of a contract of Insurance claiming Rs.2,43,95,912/- towards damages to imported solar panels. The plaintiff has claimed interest at 12% p.a., on the total claim of Rs.2,17,30,850/- and as on the date of the plaint, had claimed Rs.2,43,95,712/- and also sought interest at 12% p.a., from the date of the plaint till the date of realisation. This claim had been made on the basis of a Marine Cargo Open Policy - Inland bearing No. MO-0008426-000-00. This policy was dated 10.05.2011.
28. The plaintiff M/s. OPG Energy (P) Ltd., is a Company incorporated under the provisions of the Companies Act 1956. It has its registered office at Chennai. It has its factory at Bap Village,Tehsil Phalodi, Jodhpur District in Rajasthan. The defendants M/s. Cholamandalam MS General Insurance Company Limited are the insurers and the plaintiff has laid its claim owing to damages caused to the goods, which were the subject matter of the Insurance Policy entered into by the plaintiff with the defendants. The plaintiff had necessity to enter into such policy since the goods, namely, solar panels were imported from Yantian, China and also from USA to the factory premises in Bap Village, Jodhpur.
29. The object of the insurance was to be protected from any loss owing to damages caused during transit / transit by sea, ocean and transit by containers/ lorry through road. There were three points of pre-inspection of the goods. At the port of uploading the goods in Yantian, China and in the USA, at the port of off-loading the goods and at the time when the goods are again uploaded for tansit through road. It must also be mentioned that the goods in question are solar panels. The policy taken by the plaintiff covers the risk of loss/ damage caused by (a) fire and allied perils; (b) Act of God perils; (c) theft and pilferage; (d) non delivery of goods; (e) derailment of goods; (f) over turning of vehicle; (g) breakage; (h) Leakage, damage caused by mud, water damage, Hook damage, jerks and jolts damage during transit. The policy was an open end policy.
30. The policy which was termed Marine Cargo Open Policy - Inland has been produced as Ex.P-1. PW-1, who produced Ex.P-1, was cross examined on the side of the defendants and the cross examination concentrated on the terms and conditions of the policy. The period covered under the policy was from 24.02.2011 to 23.02.2012. The sum insured for the cargo was Rs.45 crores. The property insured was described as equipments, related to erection of solar power plant, including imported indigeneous machineries. The defendants have not raised any objection that the property actually imported did not fall within this description.
31. The packing necessary for these goods had been stated in the policy as "standard and customary". The defendants were the insurers. They always had the right to impose terms and conditions under which they would accept insurance and would honour any claim made by the insured. They were aware of the nature of the goods, which were to be imported through sea and road. The only condition given with respect to packing was that it should be standard and customary. Specifications were not given. It was also mentioned in the policy that transhipment was through road and rail. The basis of the value of the property insured was on the basis of the invoice amounts plus 10%. When the policy was taken, the plaintiff had paid premium of Rs.2,02,500.00. The defendants have not raised any issue either regarding non disclosure of the nature of the goods or regarding wrong disclosure of the nature of the properties or regarding any mala fide in the disclosure of the goods.
32. It is clear that both the plaintiff and the defendants had entered into the contract of Insurance knowing fully well the terms and conditions which bound them whenever a claim arose and also the obligations imposed on both of them, when such claims are raised and attended to. The insurance conditions and warranties were also produced in Ex.P-1.
33. The policy, termed Marine Cargo Open Policy - inland was produced as Ex.P-1. PW-1, who produced Ex.P-1 was cross examined. He asserted that the consignment was packed in accordance with requirement. He also stated that the clalim to the insurer was given within time and in accordance with the terms of the policy marked as Ex.P-1.
34. A perusal of Ex.P-1 also shows that it came into efefct from 10.05.2011 and subsisted till 09.05.2012. The premium payable was Rs.2,02,500/-. The sum insured was Rs.4,50,000,000/-. The terms and conditions were also given in the policy. In that it was specifically mentioned inland transit (road/rail). This had been interpreted by the learned Senior Counsel for the plaintiff to include the the tail end transit. However, Serial No.4 of teh schedule excluded second hand/ used items/rejects / return transits / tail end transits, unless written agreement is taken as to the rate and other terms prior to the commencement of each such transit. However in the conditions and warranties, it was also provided that the policy covers in the transit clause. The property insured was described as equipments, related to erection of power plant including imported and indigeneous machineries. The defendants have not raised any objection that the properties actually imported did not fall within this category.
35. Even though there is an exclusion clause with respect to tail end transit, however, it has to be mentioned that the policy was from warehouse to warehouse. In this case, in the Marine Cargo Open Policy, it had been provided with respect to inland tansit, that the preliminary loss or damage should not be attributable to any willfull misconduct by the insured or caused by civil war revolution or acts of threat or resulting from strikes lock out or persons taking part in labour disturbance. In class 5, it had been specifically given as follows:-
"This insurance attaches from the time the goods leave the warehouse and/or the store at the place named in the policy for the commencement of transit and continues during the ordinary course of transit including customary transhipment if any,
(i) unit delivery to the final warehouse at the destination named in the policy or
(ii) in respect of transit by rail only or rail and road, unit expiry if 7 days after arrival of the railway wagon at the final desitnation railway station or
(iii) in respect of transit by Road only unit expiry of 7 days after arrival of the vehicle at the destination town named in the policy, whichever shall first occur.
N.B., 1. The period of 7 days referred to above shall be reckoned from the midnight of the day of arrival of railway wagon at the destination railway station or vehicle at the destination town named in the policy.
2. Transit by Rail only shall include incidental transit by Road performed by Railway Authorities to or from Railway out-Agency."
36. It is thus seen that the insurance attaches from the time when the goods leave the warehouse for the commencement of transit and continues during the ordinary course of tansit including customary transhipment till delivery to the final warehouse at the destination named in the policy. It also specifically included transit by road or rail. It also included incidental transit by road. This has again been reiterated in the schedule to the policy wherein it had again been specifically provided that the insurance shall attach and shall continue to attach during the ordinary course of transit till termination of delivery to the consignees. Finally, the warehouse premises or place of storage at the destination was also named. The destination was at the factory premises of the plaintiff at Bap Village, Tehsil Phadlodi, Jodhpur District, Rajasthan.
37. It is clear that the plaintiff and the defendants had a valid contract of insurance. The issue framed was whether there was a valid contract of insurance on the date of the accident, since the claim is based on damage of goods during transit value and transit. The issue is answered that there was a valid contract of insurance at the time when the loss was detected and when the claim was laid. This issue is answered accordingly in favour of the plaintiff.
Issue No.2:
38. The plaintiff had instituted the suit on the strength of a Marine Insurance policy No. 0008426-000-00 taken from the defendants to cover any risk or loss suffered for the goods, during the period of transit. The goods involved were solar panels, equipments and indigeneous machineries. The policy was an open end policy in the sense that it covered import of machineries, import of solar panels and allied articles from anywhere in the world and transhipment of the same through sea, road or rail till the site of the plaintiff at Bap Village in Jodhpur, Rajasthan. The sum insured was Rs.45/- crores which was bsed on the valuation CIF + 10%. The plaintiff paid a premium of Rs.2,02,500/-. The limit of the insurer was Rs.20/- Crores. In the policy which had been signed by both the plaintiff and the defendants, it had been mentioned that the period of insurance was from 10.05.2011 till 09.05.2012.
39. In the instant case, the intimation of loss by the plaintiff was on 10.10.2011 during the subsistence of the insurance policy. Among other risks were also included inland tansit (rail/road) and "all risk" . Though there was a condition that if the declaration did not fall within the terms and conditions of the policy, then it would be considered as null and void. abinitio, it is pertinent to point out that the defendants had not challenged the plaintiff on that aspect. It was also mentioned in the schedule to the policy that the insurance attaches from the time the goods leave the warehouse for the consignment of the transit and continues during the course of transit including customary transhipment. The policy was from warehouse to warehouse. However, a clause in the policy that tail end transit was included only if written agreement was taken prior to the consignment of each such transit. The words written agreement can be expanded to mean pre-inspection by authorised surveyors prior to the goods leaving the warehouse at the tail end and a report of the surveyors regarding such inspection. The insurance contract is concluded at the time when the policy is taken and premium amount is paid by the insurered and when the insurance policy is issued to by the insurer. Thereafter both the parties are under obligation to abide by the terms and conditions thereof.
40. In the present case, predespatch inspection had been done and Ex.P-2 dated 06.06.2011 is a declaration sent by the plaintiff to the defendants that the consignment was ready for despactch from Rotterdam and seeking coverage of the consignment under the policy. Ex.P-2 related to eight separate consignments and the letters and dated 06.06.2011, 15.06.2011, 05.08.2011, 16.08.2011, 16.08.2011, 08.09.2011 (2 letters) and 19.09.2011.
41. The defendants were put on notice regarding the value of each consginment in US Dollars. The port of discharge in India was shown as Nhave Sheva Port and the place of delivery was given as Bap Village, Tehsil Phalodi, Jodhpur, Rajasthan. This was also given in the bills of lading with respect to each consignment. The bills of lading were marked as Ex.P-3 series. The invoices were marked as Ex.P-4. The plaintiff has also produced the documents of the packing list. The description of the goods were given and the number of panels were also given. There was nine such list enclosed in ex.P-5. The panels which arrived at the point of destination were found to be damaged, the insurance policy covered inland transit (rail/road). It also covers portion of transit till the project site at Rajasthan. Consequently, this issue whether the insurance policy cover inland transit is answered in favour of the plaintiff.
Issue No. 3:
42. The defendants have claimed that there has been violation of the terms and conditions of the Insurance Policy primarily on the ground that there was a delay in intimation of the loss and this had prejudiced their recovery from the transporter. They have also claimed that there was improper packing and that the pre-despatch inspection did not cover all consginments. With respect to the pre-despatch inspection, the Insurance Policy itself stipulates that there should be pre-despatch inspection of the outward packing alone. With respect to the packing, no specific guideline has been given for the packing of the consignments. What was actually stipulated was that the packing should be 'standard and customary'. The observation of the surveyor that if there had been 4 inches width space given between the two solar panels the likelihood of damage would be less, is based only on presumption. Even the surveyor in his report has used the words 'say' about 4 to 5 inches. Consequently, the defence taken by the defendant with respect to packing and with respect to pre-despatch inspection are rejected by this Court.
43. The defendant had taken a further defence regarding delay in intimation of loss. The following dates may be relevant. On 16.08.2011, the pre-despatch survey had been done by the approved surveyor and inspection report was given that the consignment was observed to be in sound condition outwardly. This was given in Ex.P-5. It must also be mentioned that thereafter the plaintiff had to open each one of the containers. They had intimated loss and damage to the defendant on 10.10.2011.
44. It is the claim of the plaintiff that the defendants should have processed the claim within a period of 30 days. However, though the loss was intimated on 10.10.2011, it was repudiated only on 06.02.2013, nearly 16 months later. The defendants cannot shift the blame on the plaintiff when they taken their own time in repudiating the claim. The burden was on the defendants to settle or repudiate the claim of the plaintiff on receipt of the final survey report. This report was dated 02.10.2012. They could have very easily lalid a claim against the carrier by obtaining a subrogation letter from the plaintiff. They did not do so. The period of limitation for instituting the suit against the carrier is three years. If the defendant had processed the claim and had given a definite answer either accepting the claim or repudiating the claim within the period stipualted, they could have then proceeded against the carrier. The defendant had delayed processing the claim of the plaintiff. This delay on the part of the defendant is purely a delay solely attributable only to the defendant.
45. In Lakhmi Chand Vs. Reliance General Insurance reported in (2016) 3 SCC 100, the Hon'ble Supreme Court had stated in paragraph No. 16 as follows:-
"the insurance company, in order to avoid liability must not only establish the defence claimed in the proceeding concerned, but also establish breach on the part of the owner/insured of the vehicle for which the burden of proof would rest with the insurance company. Further, for the insurer to avoid his liability, the breach of the policy must be so fundamental in nature that it brings the contract to an end."
46. This Judgment had been subsequently followed by the Hon'ble Supreme Court in Manjeet Singh Vs. National Insurance Company Ltd., and another reported in I (2018) CPJ 1 (SC) wherein also it had been held that to avoid liability, the Insurance Company must not only establish the defence that the policy has been breached but must also show that the breach of the policy is so fundamental in nature that it brings the contract to an end.
47. In Civil Appeal No. 15611 of 2017, by Judgment dated 04.10.2017, in Om Prakash Vs. Raliance General Insurance and Anr., in a case where a vehicle was stolen at about 9 p.m. on 23.03.2010 and FIR was lodged on 24.03.2010 and the insurance claim was lodged on 31.10.2010, the Hon'ble Supreme Court held as follows:-
"10. Condition No.1 of the Insurance Policy states that notice shall be given in writing to the company immediately upon the occurrence of any accidental loss or damage in the event of any claim and thereafter the insured has to give all such information and assistance as the company may require.
11. It is common knowledge that a person who lost his vehicle may not straightaway go to the Insurance Company to claim compensation. At first, he will make efforts to trace the vehicle. It is true that the owner has to intimate the insurer immediately after the theft of the vehicle. However, this condition should not bar settlement of genuine claims particularly when the delay in intimation or submission of documents is due to unavoidable circumstances. The decision of the insurer to reject the claim has to be based on valid grounds. Rejection of the claims on purely technical grounds in a mechanical manner will result in loss of confidence of policy-holders in the insurance industry. If the reason for delay in making a claim is satisfactorily explained, such a claim cannot be rejected on the ground of delay. It is also necessary to state here that it would not be fair and reasonable to rejet genuine claims which had already been verified and found to be correct by the investigator. The condition regarding the delay shall not be a shelter to repudiate the insurance claims which have been otherwise proved to be genuine."
48. It must also be incidentally pointed out that subsequently in another case in SLP No. 24370 of 2015, by Judgment dated 09.01.2018, the issue whether delay in intimation of loss could be a ground to repudiate the claim was placed before the Hon'ble Chief Justice of India for constituting a three Judge Bench to resolve the conflicting views.
49. In the present case, the plaintiff had intimated the loss on 10.10.2011 as and when they determined the number of boxes which had been damaged. This required physical verification of each and every box. This cannot be done in a day. As the boxes are unloaded each box will have to be unpacked to determine whether the solar panels have been damaged or not. Consequently, I hold that there was no deliberate delay in intimation of loss.
50. It is also to be mentioned that the claim had been made on 10.10.2011 which is well within the period of limitation to proceed against the carrier. The defendant cannot shift the entire onus on the plaintiffs. For all these reasons, I hold that there had been no violation of the terms and conditions of the Insurance Policy. The issue is answered in favour of the plaintiff and against the defendant.
Issue No.4:
51. The findings in the survey report are very ambiguous. The survey proceeded of assumption that if there was 4 inches width space, then the solar panels would not have been damaged. However that itself is a matter of conjecture. If 4 inches had been given and if still the panels have been damaged, then the surveyor would have extended the width to about 7 to 8 width. Consequently in the absence of any clear finding on this fact, I hold that the findings in the survey report do not justify the repudiation of the claim. The issue is answered against the defendant.
Issue No.5:
52. The repudiation of the claim by the defendant is purely unjustified. They have repudiated the claim and then questioned the delay in intimation of loss. The intimation of loss was at the earlierst possible time. However, the defendants have processed the papers after considerable delay. The plaintiff cannot be blamed for such loss. The claim had been repudiated on the ground of improper packing. This had been done only based on presumption and a definite finding on proper packing can never be given. Even otherwise, in the Insurance Policy, specific guidelines for packing had not been given. Consequenlty, I hold that the repudiation of the claim was not justified and the issue is answered against the defendant.
Issue No.6:
53. The plaintiff assessed the loss at Rs.2,17,30,850/-. The defendants had deputed a surveyor to assess the damage. The report of the surveyor had also been marked as Ex.P-7. In the same, the assessment of loss had been given as follows:-
-------------------------------------------------------------------------------------------------------- S.No. DESCRIPTION AVERAGE UNIT DAMAGE AMOUNT RATE Rs. QUANTITY
-------------------------------------------------------------------------------------------------------- (A)
1. Cost of damaged panels of Topray-China make 3138.33 X 3648 = Rs.1,14,48,627
2. Cost of damaged Abound USA make 5453.36 X 500 = Rs. 27,26,680
---------------------
Total Invoice Value Rs.1,41,75,307 Total value on Invoice + 10% basis Rs.1,55,92,837 Less Excess @ 2% of consignment value Rs. 91,64,725 ------------------------- Net loss Rs. 64,28,112 -------------------------- (B) Loss-Assessment Additional claim Cost of damaged panels of Topray Chine make 3138.33 X 1228 = Rs. 38,53,869 Cost of damaged panels of Abound USA make 5453.36 X 189 = Rs. 10,30,685 ---------------------- Total invoice value Rs. 48,84,554 Total value on invoice value + 10% basis Rs. 53,73,009 Excess : Already deducted above @ 2% of consignment value NIL ---------------------- Net loss Rs. 53,73,009 ---------------------- A+B = Rs.64,28,112 + Rs. 53,73,009 = Rs.1,18,01,121
54. The plaintiff had not protested at the value of loss by the surveyor. The plaintiff would be entitled to a decree to that amount only. The issue is answered accordingly.
55. In the result, the suit is partly decreed to a sum of Rs.1,18,01,121/- payable by the defendant to gether with interest at the rate of 12% p.a., from the date of plaint till date of decree and thereafter at the rate of 6% p.a., from date of decree till date of realisation. The plaintiff is entitled for costs of the suit.
vsg 11.08.2018 List of Witnesses: P.W.1 S.Gopalakrishnan List of Exhibits on the side of the plaintiff: 1. Ex.P1 The copy of marine insurance policy, dated 05.08.2011;
2. Ex.P2 Declaration sent to the defendant from 06.06.2011 to 19.09.2011, dated 06.06.2011;
3. Ex.P3- Bill of Lading, dated 08.06.2011;
4. Ex.P4 Commercial invoices, dated 12.06.2011;
5. Ex.P5 Packing list, dated 12.06.2011;
6. Ex.P6 Claim lodged with surveyor on the instruction of defendant, dated 27.03.2012;
7. Ex.P7 Survey Report M/s. Mehta & Padamsey (P) Ltd., Final Assessment of Loss, dated 02.10.2012;
8. Ex.P8 Letter from plaintiff to defendant, dated 25.01.2013;
9. Ex.P9 Letter from plaintiff to defendant, dated 18.02.2013;
10. Ex.P10 Repudiation of Claim by defendant, dated 02.10.2012;
11. Ex.P11 Letter from plaintiff to defendant dated 06.03.2013;
12. Ex.P12 complaint to Chairman IRDA dated 29.03.2013;
13. Ex.P13 Legal notice to defendant dated 15.07.2013;
14. Ex.P14 Authorisation Letter.
List of Witnesses:
D.W.1 A.K.Balaji List of Exhibits on the side of the defendant:
1. Ex.D1 Certified coy of the insurance policy dated 19.07.2011.
2. Ex.D2- Provisional Loss-Assessed by Apex Assessors (P) Ltd., on the instruction of defendant in response to oral intimation of plaintiff to defendant dated 10.10.2011.
3. Ex.D3 Preliminary Loss Report of Surveyor dated 07.11.2011;
4. Ex.D4 Addemdum of survey report of surveyor dated 02.07.2012 11.08.2018 vsg C.V.KARTHIKEYAN, J.
Vsg Pre-delivery Judgment in C.S.No. 719 of 2013 11.08.2018