Delhi District Court
The New India Assurance Co. Ltd vs ) Central Warehousing Corporation on 31 March, 2023
IN THE COURT OF DR. HARDEEP KAUR,
ADDITIONAL DISTRICT JUDGE-04, SOUTH DISTRICT,
SAKET COURTS, NEW DELHI.
Old Suit No.: CS (OS) 833/2013
New Suit No:CS DJ 8736/2016
CNR No.: DLST-01-003603-2016
In the matter of:
The New India Assurance Co. Ltd.
Divisional Office
201 & 202, Hemkunt Chambers
89, Nehru Place
New Delhi.
.....Plaintiff
Versus
1) Central Warehousing Corporation
C.F.S-CWC, Distripark,
'D' node, Sector-7
Navi Mumbai-400707
2) Bharat Heavy Electricals Ltd.
Ramachandrapuram,
Hyderabad
Registered office at:
Sirifort Road
New Delhi.
..Defendants
Date of institution of the suit : 08.05.2013
Date of pronouncement of judgment : 31.03.2023
SUIT FOR RECOVERY OF RS.82,14,200/-.
JUDGMENT
1. Initially, present suit was filed before Hon'ble High Court CS DJ 8736/2016 The New India Assurance Co. Ltd. vs Central Warehousing Corp. & Anr. Page no. 1 of 28 of Delhi and pursuant to the notification no.27187/DHC/Orgl. dated 24.11.2015, present suit has been transferred to this Court.
2. The brief facts of the case as stated in the plaint are that the plaintiff i.e. The New India Assurance Company Limited is a nationalized Company registered under Indian Companies Act having its registered office at New India Assurance Building, 87, Mahatma Gandhi Road, Fort, Mumbai-400 001. The plaintiff company is dealing in the general insurance business through its various Regional, Divisional and Branch offices situated in India and abroad. Sh. J.S. Dahiya is the Principal Officer and Attorney of the plaintiff company and is accordingly fully authorised to sign and verify the plaint and to institute the suit for and on behalf of plaintiff company.
3. Defendant no.1 is Central Warehousing Corporation dealing in the business of transport of goods by sea on receipt of requisite freight charges.The defendant no.2 is a Public Sector Undertaking and is a Company duly registered under Indian Companies Act. However, no claim has been made by the plaintiff against defendant No.2 and the defendant no.2 has been made a proforma defendant for the purpose of proper adjudication of the dispute between the parties.
4. The defendant no.2 had taken out with the plaintiff an open cover in respect of shipment from anywhere in the world. In respect of the aforesaid insurance, plaintiff company had issued CS DJ 8736/2016 The New India Assurance Co. Ltd. vs Central Warehousing Corp. & Anr. Page no. 2 of 28 an open cover bearing No.3118000900007 dated 31.03.2009. The open cover was for the period from 01.04.2009 to 31.03.2010. The mode of journey described in the open cover is by rail / road / air / courier. Under the said open cover, insurance was effected of consignment consisting of incoming and outgoing raw materials, consumables, tooling, instruments and other materials including items brought in and sent back for repair / rectification / testing except items specifically excluded. The per vessel liability was fixed at Rs.50,00,00,000/-. The said policy was inter alia, made subject to Institute Cargo Clause (A). The consignment referred to herein below was declared under the captioned policy. Plaintiff had issued a Marine Cargo (Open Cover Certificate) bearing No.311800/21/09/10/70001222 Under the said certificate the below mentioned consignment was insured in the sum of Rs.19,02,32,218/-. On the aforesaid insurance, defendant no.2 had paid a premium of Rs.91,360/-.
5. In or about last week of February 2010, Voith Turbo GMBH and Co. KG (hereinafter referred to as 'shippers') had entrusted to ITG Ocean Express Line a consignment of 2 cases of Hydraulic coupling along with accessories for carriage from Hamburg to Nhava Sheva to be delivered to consignees i.e. Bharat Heavy Electricals Ltd., defendant no.2. In respect of the said entrustment the ITG Ocean Express Line had issued a Bill of Lading bearing No. 02250030061-01 dated 27.02.2010.
6. The vessel carrying the said consignment arrived at the CS DJ 8736/2016 The New India Assurance Co. Ltd. vs Central Warehousing Corp. & Anr. Page no. 3 of 28 Port of Mumbai on or about 23.03.2010. The said consignment was manifested at Item No.0225003006101 of IGM No. 24384/2010 dated 23.03.2010 of the said vessel. The said consignment was safely unloaded at the port of Nhava Sheva and shifted to CWC Distripark, Nhava Sheva. On 03.04.2010 whilst the said consignment was being loaded with the help of crane stacker, one out of the 2 cases of the said consignment slipped from the slings and fell on to the floor as a result of which substantial damage was caused to the said case. On coming to know of the accident to the said case, the defendant no.2 appointed Subhash Chander and Associates, Surveyors to survey and assess the loss caused to the said consignment. They have issued a Survey Report bearing No. SCA/NIA/R-3576/10-11 dated 07.04.2010. The said surveyors were informed on 05.04.2010 that the import consignment came by vessel M.V HS Livingstone and was discharged at Nhava Sheva. After discharging and completing port formalities, the consignment was transported to CFS Distripark, JNPT. The said consignment which consisted of 2 cases were packed in two 20 feet flat containers Nos. TGHU 349218 and TOLU 8547974. CHA's representative informed them that they had taken delivery order of the consignment and CFS were loading the wooden cases with the help of stacker crane Linda on 04.03.2010 at dark hours. The cases were first unloaded from flat rack container and kept on ground. The first case with gross weight of 4.26 tons was loaded on the trailer without any damage and same had been already dispatched to its final destination at the time of the survey. While CS DJ 8736/2016 The New India Assurance Co. Ltd. vs Central Warehousing Corp. & Anr. Page no. 4 of 28 loading second case having gross weight of 11.86 tons was lifted from the flat rack container and kept on ground. When they were loading on trailer with the help of stacker crane the wooden case slipped from its sling and fell upside down on the ground at about 2330 hrs. on 03.04.2010. Subsequently, matter was reported to the Mumbai office of defendant no.2. They applied for damage survey and appointed a surveyor who submitted their report.
7. The plaintiff appointed Protocol Surveyors and Engineers Pvt. Ltd. to survey and assess the loss caused to the said consignment. They have issued a survey report bearing No.SLA48354 dated 11.11.2011 and stated that the said consignment was damaged on 03.04.2010 at 2330 hours. According to the surveyors, the said loss/damage to the consignment was covered by the terms and conditions of the said policy. The said surveyors have stated that after damage to the said consignment at CFS, the said consignment was transported to the supplier's factory at M/s Voith Turbo Pvt. Ltd. at Hyderabad. The said surveyors have listed the parts which were damaged and which could not be repaired. Defendant no.2 have lodged a claim with plaintiff in the sum of Rs.89,34,378/-. The surveyors have assessed the loss / damage suffered by defendant no.2 at Rs.65,24,342/-. The surveyors have advised the defendant no.2 to procure damage certificate from defendant no.1. However, the said surveyors having receiving some more documents and information form defendant no.2, re-examined CS DJ 8736/2016 The New India Assurance Co. Ltd. vs Central Warehousing Corp. & Anr. Page no. 5 of 28 their assessment of loss and revised and thereafter submitted their Addendum dated 12.12.2012 assessing the loss at Rs.82,14,200/-. The defendant no.2 vide letter dated 23.04.2010 raised a monetary claim to the alleged losses with defendant no.1 in the sum of Rs.5,41,00,000/- but the defendant no.1 despite receipt of said notice did not pay any amount towards damages caused to the consignment on account of rashness, negligence and carelessness on the part of its employees.
8. It was the duty of defendant no.1 to deliver the entire consignment in question in complete safe and sound condition to its ultimate consignee but the defendant no.1 failed to deliver the suit consignment at a destination in safe and sound condition and because of the negligence and carelessness on their part, the said consignment was damaged resulting into loss to defendant no.2, as a result of the damage to the said consignment for a sum of Rs.82,14,200/- which was assessed, approved and paid by the plaintiff to the defendant no.2 towards settlement of its insurance claim in full and final settlement in respect of the damages caused to the said consignment on account of carelessness and negligence on the part of defendant no.1, its employees, representatives, agents, servants etc. Therefore, the defendant no.2 entitled to receive the suit amount from defendant no.1 along with interest @ 18% per annum on the suit amount from the date of filing of suit till payment of the same. The aforesaid act on part of the defendant no.1 and its employees, representatives, agents, servants etc. resulting into damages to the CS DJ 8736/2016 The New India Assurance Co. Ltd. vs Central Warehousing Corp. & Anr. Page no. 6 of 28 consignment in question is the presumptive proof of negligence, carelessness and misconduct on part of defendant no.1 and / or its employees, representatives, agents, servants etc.
9. The suit consignment was insured with the plaintiff company under Policy No.311800/21/09/10/7000122 against such a risk at the relevant time of damages to the suit consignment and accordingly when the defendant no.2 failed to reimburse / pay the amount of damages caused to the suit consignment, lodged an insurance claim in respect to such damages with the plaintiff and the plaintiff after following the procedure as provided under Section 64 UM of the Insurance Act and being satisfied with the cause of loss and assessment made by the surveyors in respect to damage to suit consignment, settled and paid a sum of Rs.82,14,200/- to defendant no.2 in full and final settlement of its insurance claim under the said policy in respect to damage in question and in lieu thereof, the defendant no.2 assigned, abandoned and transferred all its rights, claims and beneficial interest, title and remedy in respect to the subject matter insured as per the insurance policy including the rights to recover and realize in its own name, the aforesaid amount paid by the plaintiff in satisfaction of the insurance claim of the defendant no.2 on account of damages to the consignment in question from defendant no.1 for and on behalf of defendant no2 in favour of the plaintiff on settlement and payment of the aforesaid amount of insurance claim. Even otherwise, the plaintiff upon making aforesaid payment of the amount towards CS DJ 8736/2016 The New India Assurance Co. Ltd. vs Central Warehousing Corp. & Anr. Page no. 7 of 28 insurance claim of the defendant no.2 in respect to the consignment in question, gets a right under the law to claim and recover the said amount of damages from defendant no.1 together with interest @ 18% per annum from the date of filing of suit till realization together with cost.
10. The defendant no.1 is liable to pay a sum of Rs.82,14,200/- towards damages caused to the suit consignment on account of negligence and carelessness on the part of defendant no.1 and its employees, representatives, agents, servants etc. alongwith interest @18% per annum from the date of filing of suit till payment. The defendant no.2 has been impleaded as performa defendant being a necessary party to enable this Hon'ble court to adjudicate and grant an appropriate relief in favour of the plaintiff and / or defendant no.2 and / or jointly in favour of the plaintiff and defendant no.2. Despite service of notice dated 23.04.2010 and several requests and demands, the defendant no.1 has not yet paid the claimed amount to defendant no.2 and / or to the plaintiff company. Hence, plaintiff filed the present suit.
11. Written statement was filed on behalf of defendant no.1 wherein the defendant no.1 disputed and denied each and every allegation, averment or contention made by the plaintiff. The defendant no.1 has taken the preliminary objection that the present suit is bad for misjoinder and non-joinder of the necessary parties. The entire area of Inland Container Depot (CFS) is a Customs area under Section 8 of the Customs Act, CS DJ 8736/2016 The New India Assurance Co. Ltd. vs Central Warehousing Corp. & Anr. Page no. 8 of 28 1962 and therefore, under the overall control and supervision of customs. The said authorities are therefore, necessary parties. The suit is bad for non-joinder of necessary parties i.e. importer, carriers, shipping agent, CHA etc. It is necessary because the answering defendant did not have any contractual liability against defendant No.2 or plaintiff. No reports have been placed on record to show that at every point of change in party such as from manufacturer to exporter, from exporter to carrier, from carrier to shipping agent and so on if there are any surveys conducted to assess the damages. Thus liability cannot be directly fixed upon the CWC, who was not at all involved in handling the cargo as compared to the other parties.
12. The suit is hit by the provisions of the Order 1 of CPC as the defendant no.2 herein i.e. Bharat Heavy Electricals Ltd. has not instituted the suit against the answering defendant. The BHEL in whose favour the cause of action arose, is absent from the array of plaintiffs. Moreover the suit could not have been instituted against the BHEL. Although the rights have been subrogated by the defendant no.2 in favour of plaintiff. The BHEL could not have dropped from the array of plaintiffs. The suit is hit by the provisions of Order II of CPC. The plaintiff has not sought declaration against the defendant no.1 on the issue of negligence, without which the plaintiff cannot seek recovery of money. The substantive relief is relinquished. The plaint is not in accordance with Order VII Rule 5, which requires the plaint to show that defendants are liable to be called upon to answer the CS DJ 8736/2016 The New India Assurance Co. Ltd. vs Central Warehousing Corp. & Anr. Page no. 9 of 28 plaintiff's demand. The suit is liable to be dismissed as the plaint does not disclose any cause of action against the defendant no.1. The suit is also liable to be dismissed as the plaintiff being a PSU has not got the necessary permission from High powered committee of the Government of India before filing any suit against any other Public Sector Undertaking. Plantiff has not come to the court with clean hands and suppressed the material facts. The present suit is false and frivolous, devoid of merits and as such liable to be dismissed.
13. In para-wise reply on merits, it is stated that the plaintiff has failed to produce on record the open cover of insurance policy for inspection of terms and conditions. According to the plaintiff the insurance cover was subsisting only during the period mentioned, which expired on 31.03.2010, however, the alleged incident stated to have taken place on 03.04.2010, which is out of the coverage of the cover. The defendant no.1 is not aware whether the consignment referred by the plaintiff safely unloaded at the port of Nhava-Sheva since it is a job of Port and the defendant no.1 is not related with it. Defendant no.2 did not approach the defendant no.1 and prefer to communicate in writing, despite of damage to their consignment as alleged by them. Under such circumstances, it cannot be construed that damage was happened in the premises of the defendant no.1 during the period of storage of consignments or while affecting delivery. The so called joint survey report referred by the plaintiff does not give correct information about the alleged incident of damage to the consignment and hence report is CS DJ 8736/2016 The New India Assurance Co. Ltd. vs Central Warehousing Corp. & Anr. Page no. 10 of 28 incomplete, not based on evidence and hence liable to be rejected out rightly. In the said survey report dated 05.04.2010 nowhere it was mentioned that damage occurred at the premises of the defendant no.1. The survey report does not indicate even the date of happening of incident. Further, it is mentioned in the said report that "the internal damage to the machinery can be only known at factory site or during trials". The defendant no.1 denied that the defendant no.1 acted negligently or due to rashness and carelessness the incident had taken place as alleged. Vide letter dated 17.05.2010 addressed to the defendant no.2 it was clearly pointed slackness of the supplier in securing machinery of defendant no.1. The claim vide letter dated 23.04.2010 raised by defendant no.2 on defendant no.1 was repudiated by defendant no.1 through letter dated 17.05.2010, which was sent through registered post. Therefore, there was no question of paying any amount by defendant no.1 towards alleged damage to the cargo of defendant no.2. No documentary proof is annexed with the plaint. Negligence is only pleaded and alleged and not explained.
14. Plaintiff has failed to seek declaration of negligence against the defendant no.1. Plaintiff has also failed to establish the damage happened to the machinery of defendant no.2 due to the negligence of defendant no.1. The plaintiff has neither established that the balance of the conveniences is in the favour of the plaintiff. As such, no relief can be granted particularly in view of the position explained by defendant no.1 in the letter CS DJ 8736/2016 The New India Assurance Co. Ltd. vs Central Warehousing Corp. & Anr. Page no. 11 of 28 dated 17.05.2010 addressed to defendant no.2, which was never refuted by defendant no.2 before filing of this suit against the defendant. Under such circumstances, calling upon the defendant no.1 to pay to the plaintiff a sum of Rs.82,14,200/- and interest thereon 18% per annum from the date of filing suit till realization of cost is unwarranted and unjustifiable and hence the suit is liable to be dismissed with cost.
15. Replication to the written statement of defendant no.1 filed by the plaintiff wherein the averments of the plaint have been reiterated and the contents of the written statement have been denied.
16. No written statement was filed on behalf of defendant no.2. On 16.07.2014, it is submitted by counsel for defendant no.2 that defendant no.2 does not intend to file any written statement as no relief is sought against defendant no.2. Affidavit of admission-denial of documents filed on behalf of defendant no.2 in which defendant no.2 has admitted all the documents filed by the plaintiff.
17. From the pleadings of the parties, the following issues were framed on 20.05.2015 by the Hon'ble High Court of Delhi.
ISSUES
1.Whether the plaintiff is entitled to recover a sum of Rs.82,14,200 alongwith interest @ 18% per annum from the date of filing of the suit CS DJ 8736/2016 The New India Assurance Co. Ltd. vs Central Warehousing Corp. & Anr. Page no. 12 of 28 pendent lite till realisation?OPP
2.Whether the plaintiff has no locus standi to file the instant suit?OPD-1
3.Whether the suit is bad for non-joinder of necessary parties, namely customs authorities, port authorities, carriers, shipping agent, CHA etc. i.e. the agencies involved in the concerned import?OPD-1
4.Whether the suit for recovery is maintainable without seeking a declaration of negligence on the part of defendant no.1?OPD-1
5.Whether the survey reports relied upon can be pressed into service against defendant no.1?
OPD-1
6.Whether the marine insurance policy taken by the defendant no.2 expired on 31.3.2010 i.e. prior to the alleged incident?OPD-1
7. Relief.
18. It is pertinent to mention here that when the matter was fixed for PE, the defendant no.2 has stopped appearing in the matter and vide order dated 21.08.2019, the defendant no.2 was proceeded ex parte.
19. In support of its case, the plaintiff examined two witnesses.
20. Plaintiff company examined Sh. Het Ram as PW1, he has tendered his evidence by way of affidavit as Ex.PW1/A and reiterated and reaffirmed the contents of the plaint in his CS DJ 8736/2016 The New India Assurance Co. Ltd. vs Central Warehousing Corp. & Anr. Page no. 13 of 28 affidavit. He has relied upon the following documents :
(a) Copy of Certificate of Incorporation is Ex.PW-1/1;
(b) Power of Attorney is Ex.PW-1/2;
(c) Policy is Ex.PW-1/3;
(d) Open cover certificate is Ex.PW-1/4;
(e) Copy of Bill is Mark PW-1/5 being photocopy and
Ex.PW-1/5 mentioned in the affidavit is de-
exhibited.
(f) Survey Report of Protocol Surveyors and Engineers
Pvt. Ltd. is Ex.PW-1/6;
(g) Demand Notice dated 23.04.2010 is Ex.PW-1/7;
(h) Letter for Subrogation is Ex.PW-1/8;
(i) Claim Voucher is Ex.PW-1/9;
(j) Original postal receipt with acknowledgment is
Ex.PW-1/10 (Colly)
21. Plaintiff company has examined Sh. Vivek Johar as PW2 and he tendered his evidence by way of affidavit as Ex. PW2/A. He has also relied upon document i.e. Survey Report Ref.No.2010-MAY-214 dated 11.11.2011 of Protocol Surveyors and Engineers Pvt. Ltd. already exhibited is Ex.PW-1/6 (mentioned as R1 in his affidavit Ex.PW2/A).
22. No other witness has been examined by the plaintiff and PE was closed vide order dated 04.04.2018.
23. In its defence evidence, the defendant no.1 examined Sh.
Bhuwneshwar Dwivedi as DW1 and he tendered his evidence by way of affidavit as Ex.DW1/A and reiterated and reaffirmed CS DJ 8736/2016 The New India Assurance Co. Ltd. vs Central Warehousing Corp. & Anr. Page no. 14 of 28 the contents of its Written Statement. He has relied upon following documents:
(a) Ex.DW1/1 is Original Authority Letter in his favour issued by Regional Manager of defendant no.1 (objected to as to mode of proof);
(b) Ex.DW1/2 is photocopy of Letter dated 17.05.2010 issued by defendant no.1 to defendant no.2 (OSR) (mentioned as Ex.RW1/2 in para no.11 of affidavit Ex.DW1/A(objected to as to mode of proof).
24. No other witness has been examined on behalf of defendant no.1 and evidence on behalf of defendant no.1 was closed vide order dated 21.08.2019.
25. This court has heard the arguments addressed by the counsel for plaintiff and counsel for defendant no.1. Written submission on behalf of plaintiff and defendant no.1 filed. Record perused carefully.
26. Issue wise findings are as under:
ISSUE No.1:
Onus to prove this issue is on the plaintiff. Plaintiff company examined Sh. Het Ram as PW1 and he deposed in his evidence by way of affidavit Ex.PW1/A that plaintiff company is dealing in the general insurance business through its various Regional, Divisional and Branch offices situated in India and abroad. Defendant no.1 is Central Warehousing Corporation CS DJ 8736/2016 The New India Assurance Co. Ltd. vs Central Warehousing Corp. & Anr. Page no. 15 of 28 dealing in the business of transport of goods by sea on receipt of requisite freight charges. Defendant no.2 is a Public Sector Undertaking and is a Company duly registered under Indian Companies Act. However, no claim has been made by the plaintiff against defendant No.2 and the defendant no.2 has been made a proforma defendant for the purpose of proper adjudication of the dispute between the parties. Defendant no.2 had taken out with the plaintiff an open cover in respect of shipment from anywhere in the world. In respect of the aforesaid insurance, plaintiff company had issued an open cover bearing No.3118000900007 dated 31.03.2009. The open cover was for the period from 01.04.2009 to 31.03.2010. The mode of journey described in the open cover is by rail / road / air / courier. Under the said open cover, insurance was effected of consignment consisting of incoming and outgoing raw materials, consumables, tooling, instruments and other materials including items brought in and sent back for repair / rectification / testing except items specifically excluded. The per vessel liability was fixed at Rs.50,00,00,000/-. The said policy was inter alia, made subject to Institute Cargo Clause (A).
He further deposed that plaintiff had issued a Marine cargo (Open Cover Certificate) bearing No.311800/21/09/10/70001222. Under the said certificate the below mentioned consignment was insured in the sum of Rs.19,02,32,218/-. On the aforesaid insurance defendant no.2 had paid a premium of Rs.91,360/-. In or about last week of February 2010, Voith Turbo GMBH and Co. KG had entrusted to ITG Ocean Express Line a consignment CS DJ 8736/2016 The New India Assurance Co. Ltd. vs Central Warehousing Corp. & Anr. Page no. 16 of 28 of 2 cases of Hydraulic coupling along with accessories for carriage from Hamburg to Nhava Sheva to be delivered to consignees i.e. Bharat Heavy Electricals Ltd., defendant no.2.
He further deposed that said consignment was manifested at Item No.0225003006101 of IGM No. 24384/2010 dated 23.03.2010 of the said vessel. The said consignment was safely unloaded at the port of Nhava Sheva and shifted to CWC Distripark, Nhava Sheva. On 03.04.2010 whilst the said consignment was being loaded with the help of crane stacker, one out of the 2 cases of the said consignment slipped from the slings and fell on to the floor as a result of which substantial damage was caused to the said case. On coming to know of the accident to the said case, the defendant no.2 appointed Subhash Chander and Associates, Surveyors to survey and assess the loss caused to the said consignment. They have issued a Survey Report bearing No. SCA/NIA/R-3576/10-11 dated 07.04.2010. The said surveyors were informed on 05.04.2010 that the import consignment came by vessel M.V HS Livingstone and was discharged at Nhava Sheva. The said consignment which consisted of 2 cases were packed in two 20 feet flat containers Nos. TGHU 349218 and TOLU 8547974. When they were loading on trailer with the help of stacker crane the wooden case slipped from its sling and fell upside down on the ground at about 23:30 hrs. on 03.04.2010. Subsequently, matter was reported to the Mumbai office of defendant no.2. They applied for damage survey and appointed a surveyor who submitted their report.
CS DJ 8736/2016 The New India Assurance Co. Ltd. vs Central Warehousing Corp. & Anr. Page no. 17 of 28 He further deposed that plaintiff appointed Protocol Surveyors and Engineers Pvt. Ltd. to survey and assess the loss caused to the said consignment. They have issued a survey report bearing No.SLA48354 dated 11.11.2011 and stated that the said consignment was damaged on 03.04.2010 at 23:30 hours. According to the surveyors, the said loss/damage to the consignment was covered by the terms and conditions of the said policy. The said surveyors have stated that after damage to the said consignment at CFS, the said consignment was transported to the supplier's factory at M/s Voith Turbo Pvt. Ltd. at Hyderabad. The said surveyors have listed the parts which were damaged and which could not be repaired. Defendant no.2 have lodged a claim with plaintiff in the sum of Rs.89,34,378/-. The surveyors have assessed the loss/ damage suffered by defendant no.2 at Rs.65,24,342/-. The surveyors have advised the defendant no.2 to procure damage certificate from defendant no.1. However, the said surveyors having receiving some more documents and information form defendant no.2, re-examined their assessment of loss and revised and thereafter submitted their Addendum dated 12.12.2012 assessing the loss at Rs.82,14,200/-. The defendant no.2 vide letter dated 23.04.2010 raised a monetary claim to the alleged losses with defendant no.1 in the sum of Rs.5,41,00,000/- but the defendant no.1 despite receipt of said notice did not pay any amount towards damages caused to the consignment.
He further deposed that said consignment was damaged resulting into loss to defendant no.2, as a result of the damage to CS DJ 8736/2016 The New India Assurance Co. Ltd. vs Central Warehousing Corp. & Anr. Page no. 18 of 28 the said consignment for a sum of Rs.82,14,200/- which was assessed, approved and paid by the plaintiff to the defendant no.2 towards settlement of its insurance claim in full and final settlement in respect of the damages caused to the said consignment on account of carelessness and negligence on the part of defendant no.1, its employees, representatives, agents, servants etc. The suit consignment was insured with the plaintiff company under Policy No.311800/21/09/10/7000122 against such a risk at the relevant time of damages to the suit consignment and accordingly when the defendant no.2 failed to reimburse/ pay the amount of damages caused to the suit consignment, lodged an insurance claim in respect to such damages with the plaintiff. In respect to damage to suit consignment, plaintiff settled and paid a sum of Rs.82,14,200/- to defendant no.2 in full and final settlement of its insurance claim under the said policy in respect to damage in question and in lieu thereof, the defendant no.2 assigned, abandoned and transferred all its rights, claims and beneficial interest, title and remedy in respect to the subject matter insured as per the insurance policy including the rights to recover and realize in its own name. Even otherwise, the plaintiff upon making aforesaid payment of the amount towards insurance claim of the defendant no.2 in respect to the consignment in question, gets a right under the law to claim and recover the said amount of damages from defendant no.1. The defendant no.1 is liable to pay a sum of Rs.82,14,200/- towards damages caused to the suit consignment on account of negligence and carelessness on the part of defendant no.1 and its CS DJ 8736/2016 The New India Assurance Co. Ltd. vs Central Warehousing Corp. & Anr. Page no. 19 of 28 employees, representatives, agents, servants etc. Record shows that plaintiff has got rights to file present suit on the basis of Letter of Subrogation dated 30.03.2003 received from defendant no.2/ BHEL Ex.PW1/8. Plaintiff has placed on record document Ex.PW1/6 i.e. Surveyor Report dated 11.11.2011 as per this report loss was assessed @ Rs.65,24,342/-. Though, plaintiff has not placed on record Addendum dated 12.12.2012 showing that the assessed loss of Hydraulic Coupling has been increased upto Rs.82,14,200/- but BHEL/ defendant no.2 has settled its claim vide claim number CL/04/02/2009-10 dated 24.04.2010 incurred under Policy number 311800900007 and 318000900028 regarding the damage to Hydraulic coupling with the plaintiff for a sum of Rs.82,14,200/- and received its claim in the year 2013 under Claim number 31180021/11/01/90000027 vide Claim Voucher Ex.PW1/9.
In its written submissions, Ld. Counsel for defendant no.1 contended that the suit of plaintiff is time barred. He relied upon the judgment titled as "Super Tannery (India) Ltd. Vs. Central Warehousing Ltd." dated 27.10.2016 passed by Bombay City Civil Court at Bombay.
On the other hand, plaintiff has relied upon the judgment titled as "Road Transport Corporation Pvt. Ltd Vs. National Insurance Co. Ltd. & Anr., RFA No. 771/2002" passed by Hon'ble High Court of Delhi wherein it is held in para 7 that it is not disputed that the suit in the present case has been filed within three years as per Article 113 of the Limitation Act, 1963 from the date when the insurance company/ respondent no.1/ plaintiff CS DJ 8736/2016 The New India Assurance Co. Ltd. vs Central Warehousing Corp. & Anr. Page no. 20 of 28 paid the amount to the respondent no.2/ defendant no.2/ owner.
In the present case, claim of BHEL was settled vide settlement claim number CL/04/02/2009-10 dated 24.04.2010 but BHEL has received the settlement amount against the claim number CL/04/02/2009-10 dated 24.04.2010 in the year 2013. Present case has been filed on 03.05.2013. Therefore, in view of the judgment of Hon'ble High Court of Delhi titled as "Road Transport Corporation Pvt. Ltd Vs. National Insurance Co. Ltd. & Anr., RFA No. 771/2002" present suit is not barred by limitation and judgment relied upon by the defendant is not applicable in the facts of the present case. In view of the aforesaid discussion, this issue is decided in favour of plaintiff.
ISSUE No.2:
Onus to prove this issue is on the defendant no.1. Plaintiff has filed suit for recovery of Rs.82,14,200/- against defendant on the basis of Subrogation Letter Ex.PW1/8 dated 30.03.2013 which was issued by the defendant no.2 in favour of plaintiff.
It is settled law that if subrogation letter has been issued in favour of party, that party has every right which has been mentioned in the Subrogation Letter. In the present case, BHEL/ defendant no.2 has issued a Subrogation Letter in favour of plaintiff. BHEL/ defendant no.2 has subrogated, all rights and interests to plaintiff i.e. New India Assurance Company to take all actions against anyone in this regard. In view of the aforesaid discussion, this Court is of the considered view that plaintiff has locus standi to file the present suit. Hence, this issue is decided CS DJ 8736/2016 The New India Assurance Co. Ltd. vs Central Warehousing Corp. & Anr. Page no. 21 of 28 against the defendant no.1.
ISSUE No.3:
Onus to prove this issue is on the defendant no.1. Defendant no.1 stated in its written statement that present suit is bad for mis-joinder and non-joinder of the necessary parties. The entire area of Inland Container Depot (CFS) is a Customs area under Section 8 of the Customs Act, 1962 and therefore, under the overall control and supervision of customs. The said authorities are therefore, necessary parties. The suit is bad for non-joinder of necessary parties i.e. importer, carriers, shipping agent, CHA etc. It is necessary because the answering defendant did not have any contractual liability against defendant No.2 or plaintiff. No reports have been placed on record to show that at every point of change in party such as from manufacturer to exporter, from exporter to carrier, from carrier to shipping agent and so on if there are any surveys conducted to assess the damages. Thus liability cannot be directly fixed upon the CWC, who was not at all involved in handling the cargo as compared to the other parties. Defendant no.1 neither led any evidence to show how customs authorities, port authorities, carriers, shipping agent, CHA etc. are necessary party in the present suit nor during cross-examination of PW1 any suggestion has been given by the Ld. Counsel for defendant no.1 to PW1 that suit of plaintiff is bad for non-joinder of necessary parties. Hence, this issue is decided against the defendant no.1.
CS DJ 8736/2016 The New India Assurance Co. Ltd. vs Central Warehousing Corp. & Anr. Page no. 22 of 28 ISSUE No.4:
Onus to prove this issue is on the defendant no.1. To decide this issue Court has to first examine whether the accident in fact has taken place at the premises of the defendant no.1 or not and for this purpose document Ex.PW1/7 is important document which is a Demand Notice dated 23.04.2010 issued by BHEL/ defendant no.2 to defendant no.1 i.e. Central Warehousing Corporation. This document suggests that an accident took place at the premises of defendant no.1.
DW1 relied upon document Ex.DW1/2 i.e. Original letter dated 17.05.2010 which is reply to the document i.e. Ex.PW1/7. It is mentioned in this document that the "de-stuffed delivery of machines was carried out as per your request prior to taking delivery of machines the risk involved in handling of the cargo in the light of its packaging informed to your CHA however at his insistences de-stuffed delivery was carried out with utmost care and first machine was loaded safely. The other machine could not be loaded due to improper securing of the machine by your supplier and it can be seen that more than half of the machine is exposed without insuring". It is proved by this document that defendant no.1 admitted the fact that accident was occurred at its premises in which damage to the consignment i.e. Hydraulic Coupling Machine was occurred.
Further, DW1 in his cross-examination on 21.08.2019 produced on record a document i.e. Joint Survey of Damage Hydraulic Coupling along with accessories dated 05.04.2010 at 18:15 hrs which is also exhibited as Ex.DW1/2. This joint survey CS DJ 8736/2016 The New India Assurance Co. Ltd. vs Central Warehousing Corp. & Anr. Page no. 23 of 28 was conducted in presence of officials of defendant no.1 as well as BHEL/ defendant no.2 wherein it is noted that following damages on packaging wooden package machinery occurred:
1. Outer wooden package completely damaged.
2. Junction Box supporting frame damaged.
3. Guage Panel and supporting frame damaged.
4. Moter cover pressed.
5. Oil leaked from machinery.
6. Transportation base frame 'C' Channel Bent.
7. Cuter hydraulic Pipes Bent at various places.
These two documents i.e. Document Ex.DW1/2 i.e. reply to Demand Notice dated dated 23.04.2010 and Ex.DW1/2 i.e. Joint Survey of Damage Hydraulic Coupling along with Accessories dated 05.04.2010, proved the fact that accident in fact had taken place at the premises of defendant no.1 on 03.04.2010. Once this fact has been proved that accident has occurred in which Hydraulic Coupling Machine was damaged at the premises of defendant no.1 i.e. Central Warehousing Corporation, onus shifts upon defendant no.1 to prove that defendant no.1 has taken all precautions in handling the consignment and there was no negligence on its part. But regarding this no evidence has been led on behalf of defendant no.1. Therefore, this issue is decided against the defendant no.1.
ISSUE No.5:
Onus to prove this issue is on the defendant no.1. It is the case of the plaintiff that it appointed Protocol Surveyors Pvt. Ltd. to survey and assess the loss caused to the said consignment i.e. Hydraulic Coupling Machine. They had issued a survey report CS DJ 8736/2016 The New India Assurance Co. Ltd. vs Central Warehousing Corp. & Anr. Page no. 24 of 28 dated 11.11.2011 Ex.PW1/6. It is reported by them that the said consignment was damaged on 03.04.2010 at 23:30 hrs. According to the surveyors, the said loss/ damage to the consignment was covered by the terms and conditions of the insurance policy. The surveyors have assessed the loss/ damage suffered by the BHEL/ defendant no.2 @ Rs.65,24,342/-. The surveyors had advised the BHEL/ defendant no.2 to procure damage certificate from defendant no.1. However, the said surveyors have received more documents and informations from BHEL, re-examined their assessment of loss and revised and thereafter submitted their Addendum dated 12.12.2012 assessing the loss @ Rs.82,14,200/-. However, PW1 produced the document Ex.PW1/6 which shows that defendant no.2 suffered a loss of Rs.65,24,342/- but Addendum dated 12.12.2012 is not placed on record by the plaintiff. To prove this fact, plaintiff examined one more witness PW2 Sh. Vivek Johar from Protocol Insurance Surveyors Loss Assessor Pvt. Ltd. (Formally Protocal Surveyors and Engineers Pvt. Ltd.) and he deposed in favour of plaintiff on similar lines as deposed by PW1. During cross- examination PW2 deposed that survey was conducted on 06.05.2010 and 22.05.2010 but report was submitted on 11.11.2011 and he denied that they have submitted any false affidavit.
PW1 was cross-examined by counsel for the defendant no.1 at length. In his cross-examination he admitted that Officials of defendant no.1 have not been informed or requested to participate in the survey conducted by the surveyors while CS DJ 8736/2016 The New India Assurance Co. Ltd. vs Central Warehousing Corp. & Anr. Page no. 25 of 28 inspecting the premises of the defendant no.1 where the goods were kept in transit. Further, admitted that the plaintiff or its appointed surveyors i.e. Protocal Surveyors and Engineers Pvt. Ltd. have not invited the defendant no.1 to participate in its survey conducted and the report dated 11.11.2011. He admitted that neither damage certificate has been taken from the defendant no.1 nor it has been requested at any point of time by the plaintiff or by the defendant no.2.
Though, Survey Report Ex.PW1/6 has been prepared in the absence of defendant no.1 but it is an important piece of evidence. At the very outset, it is to be understood that the said Survey Report was prepared by the Insurance Company (Insurer) for the disbursal of loss amount to the BHEL/ defendant no.2 (insured). As such the survey report can't be termed as unilateral or self serving to the Insurance Company. So far as, defendant no.1 is concerned this Survey Report is to be read in the backdrop of the Joint Survey of Damage Hydraulic Coupling Inspection Report Ex.DW1/2 which was produced by the defendant no.1 itself during cross-examination of DW1 dated 21.08.2019. Further, DW1 in its examination-in-chief also relied upon the document Ex.DW1/2 i.e. reply to the Demand Notice dated 23.04.2010. As such it cannot be said that the defendant no.1 was not having knowledge of the accident or the damage occurred to Hydraulic Coupling Machine. Moreover, an Insurance Company is duly bound to appoint a surveyor as per provisions of Insurance Act, 1938. In view of the aforesaid discussion, survey report Ex.PW1/6 relied upon can be pressed CS DJ 8736/2016 The New India Assurance Co. Ltd. vs Central Warehousing Corp. & Anr. Page no. 26 of 28 into service against defendant no.1. Therefore, this issue is decided against the defendant no.1.
ISSUE No.6:
Onus to prove this issue is on the defendant no.1. It is stated in the written statement that according to the plaintiff, the insurance cover was subsisting only during the period mentioned in it which expired on 31.03.2010, however, the alleged incident stated to be taken place on 03.04.2010 which is out of the coverage of the policy cover.
PW1 during his cross-examination dated 14.12.2017, admitted that open cover policy was expired on 31.03.2010 and alleged date of incident causing damage of the goods is beyond the period of policy cover. But he denied the suggestion that the plaintiff has allowed and paid the claim to the defendant no.2 in arbitrary and illegal manner. He voluntarily deposed that their risk cover was from the date of journey of bill of lading dated 27.02.2010 till the final destination. It is admitted fact that consignment was not reached to its final destination on 31.03.2010 and it was in transit. In view of aforesaid discussion, this issue is decided against the defendant no.1.
RELIEF:
In view of the fact that issue no.1 is decided in favour of plaintiff and issue no.2 to 6 are decided against the defendant no.1. Therefore, plaintiff is entitled for a decree of Rs.82,14,200/-
CS DJ 8736/2016 The New India Assurance Co. Ltd. vs Central Warehousing Corp. & Anr. Page no. 27 of 28 along with interest @ 6% from the filing of the present suit till its realization. Cost of the suit is also awarded in favour of plaintiff.
Decree sheet be prepared accordingly on filing of deficient Court fee, if any.
File be consigned to the Record Room.
Typed to the dictation directly, corrected and pronounced in the open Court on 31.03.2023.
(Dr. Hardeep Kaur) Additional District Judge-04 South District, Saket Courts, New Delhi CS DJ 8736/2016 The New India Assurance Co. Ltd. vs Central Warehousing Corp. & Anr. Page no. 28 of 28