Delhi District Court
Suit No. : 548/09 vs Swaran Singh & Anrs Reported As on 3 July, 2014
IN THE COURT OF SH. PITAMBER DUTT; ADJ (CENTRAL)11,DELHI
Suit No. : 548/09
Unique Case ID : 02401C5135472004
M/s. Uflex Limited
Earlier known as
M/s FCL Technologies & Products Ltd.
Registered office
305, Third Floor,
Bhanot Corner, Pamposh Enclave
Greater Kailash-1, New Delhi
......P l a i n t i f f
Versus
The New India Assurance Co. Ltd.
Branch Office:
having its Branch Office at
3, Arya Samaj Road,
Karol Bagh,
New Delhi-110 005 .........D e f e n d a n t
Date of Institution of Suit : 19.03.2004
Date when reserved for orders : 19.05.2014
Date of Decision : 03.07.2014
JUDGMENT
1 Vide this judgment I shall decide a suit for recovery of Rs.19,04,767/- along with pendente lite and future interest file by the plaintiff against the defendant. The brief fact necessitated in filing the present suit are given as under:-
2 The plaintiff is company duly incorporated under the Companies Act, 1956. It is engaged in the business of manufacture of Polyestar Chips Suit No. 548/09 Page no. 1 of 23 commonly known as "PET CHIPS" apart from other business. The plaintiff had taken a Special Declaration Policy (Cargo) being Policy No. 2131100200912/768 dated 13.02.1998 valid w.e.f. 15.02.1998 to 14.02.1999 for the insurance of consignment which comprised of Polyester Chips for a value of Rs.129 Crores. The premium of Rs.13,78,234/- was duly paid by the plaintiff.
3 The plaintiff dispatched a consignment of approximately 12,000 kg's of Polyester Chips on 15.09.1998 vide GR No. 1012 and 1013. The goods were packed in Jumbo Polythene knitted bags and were dispatched through a reputed carrier namely M/s. Malik Road Carriers in truck No. UP-78N-7798 from its factory at Malanpur, Gwalior. The truck was duly covered with water- proof tarpaulin. During the transit from Malanpur to NOIDA there was heavy rainfall / cloud burst due to which the consignment dispatched by the plaintiff was badly damaged because the rain water had seeped in and the goods had become totally wet and incapable of being used for manufacture of films due to which the entire consignment was rejected by the consignee.
4 The plaintiff immediately on 18.09.1998 informed the defendant about the damage suffered by it. The defendant appointed a surveyor M/s. J.B. Boda Surveyors Pvt Ltd who visited the site and a survey of the damaged goods was conducted on 19.09.1998. The said surveyor recorded the statement of the driver and took sample from the said consignment and got it tested from the laboratory of the consignee. As per the test conducted at the laboratory of the consignee all the samples, were found to have moisture content of more than 0.8%. As per the report of the surveyor all the bags were found drenched with water and attributed cause of loss as due to rain water in transit. The surveyor appointed by the defendant visited the office of the Suit No. 548/09 Page no. 2 of 23 plaintiff number of occasions and raised queries and demanded various documents from the plaintiff and they provided all the documents to the surveyor as demanded. The plaintiff fulfilled all the terms and conditions of the Insurance Policy and has not committed any breach of warranties.
5 The plaintiff wrote several letters, reminders and officers of the plaintiff personally visited the office of the defendant but it chose not to act upon the representations and the claim of the plaintiff. The defendant, however, after a lapse of more than 4 and ½ years vide letter dated 20.03.2003, repudiated the claim of the plaintiff on false and frivolous grounds. The plaintiff submitted its claim on 18.9.1998 and the said claim was repudiated vide letter dated 20.3.2003 i.e after four and half years of lodging of complaint. Due to the inordinate delay on the part of the defendant in communicating their decision to repudiate the claim, the plaintiff's right to recover damages from the transporter got extinguished because plaintiff was always assured that their claim would be settled by the defendant. It is further averred that the defendant maladroitly repudiated the claim of the plaintiff and the said repudiation is not valid in the eyes of law, therefore, plaintiff is entitled to recover Rs. 11,47,450/- from the defendant alongwith interest.
6 The plaintiff issued a legal notice dated 05.11.2003 demanding an amount of Rs.11,47,450/- along with interest @ 12 % per annum with effect from 15.09.1998. The said notice was duly served upon the defendant who replied the same vide its reply dated 01.01.2004. However, defendant has failed to pay the amount. On the basis of the aforesaid averment, present suit has been filed for adjudication.
Suit No. 548/09 Page no. 3 of 23 7 Pursuant to the summons defendant appeared and filed its written
statement taking preliminary objection that plaintiff has not approached the court with clean hands, that plaintiff has no locus standi to file the present suit; the plaint has not been signed and verified by the competent and authorized person; that the plaintiff has committed flagrant breaches of the terms and conditions of the policy, dis entitling them from any compensation under the Insurance contract.
8 On merit it is stated that defendant issued Special Declaration Marine Policy (Cargo) bearing No. 2131100200912/768 dated 13.02.1998 for Rs. 129 crores in favour of M/s. Flex Chemicals Ltd. The plaintiffs stated to have imported 104 tons of special grade Pet Chipa with antistatic properties from Japan in 1997, out of which approximately 34 tons were utilized for manufacturing antistatic film for special applications. The remaining 70 tons of Pet Chips required reprocessing / improvement and as such stated to have been sent to their unit at Malanpur from NOIDA for purpose of reprocessing and these were allegedly being transported back in various trucks through M/s. Malik Road Carrier, Ghaziabad vide Grs dated 15.09.1998 respectively and delivered at the premises of M/s. Flex Industries Ltd. at NOIDA, UP on 16.09.1998, when all the consignments were allegedly found to be drenched in rain water and became unusable on account of leakage of water into the trucks through holes in the tarpaulins used by the transporter.
9 The plaintiff gave intimation dated 18.09.1998 that their consignment vide GR No. 1012 and 1013 dated 15.09.1998 by truck No. UP-78N-7798 reached in a wet condition on 16.09.1998. On receipt of intimation, the defendant appointed M/s. J.B. Boda Surveyor Pvt. Ltd as surveyor to inquire into and survey the loss, who inspected the damaged goods and submitted Suit No. 548/09 Page no. 4 of 23 their reports dated 21.05.1999. The surveyor reported that the consignment packed in 14 Jumbo bags was badly drenched in water and opined that rain water had entered into the consignment on account of holes in the tarpaulin sheet used to cover the truck. It is averred that while processing the claim defendant found some intriguing fact namely, that all the consignment sent for reprocessing for Malanpur and allegedly transported back to the premises of M/s. Flex Industries Ltd. at NOIDA were similarly found in extremely wet condition and claims were lodged. It is also found that the trucks were not covered with water proof tarpaulin as per the requirement of the policy, and the tarpaulin sheets were in fact found out with holes. The defendant consequently held a meeting with the surveyors in respect of different consignment, who submitted their joint report dated 24.03.2000. Thereafter, vide letter dated 25.07.2000 sought clarification from the plaintiff as to why improper tarpaulin was used to cover the consignment. The plaintiff did not give any reply to the said notice.
10 The defendant had some doubt about the authenticity of the name and address of the transporter and therefore, they appointed Sh. Khushi Ram as investigator who made inquiries and submitted his report dated 30.09.2002 to the effect that no such transporter was existed at the given address. It is further averred that defendant has reason to believe that 70 tons of a Chips were not at all sent for reprocessing and a false claim has been lodged by the plaintiff on the basis of seepage of water into these consignments. It is denied that truck was duly covered with waterproof tarpaulin. It is stated that goods got drenched solely on account of acts of omission and commission and lack of care and willful breach of mandatory warranties under the policy. It is denied that defendant had repudiated the claim in a malafide manner. It is denied that defendant is liable to pay any amount to the plaintiff as claimed.
Suit No. 548/09 Page no. 5 of 23 All other averment have also been denied. It is prayed that suit be dismissed with cost.
11 The Plaintiff filed replication to the written statement whereby reiterated the averment made in the plaint and denied the averment made in the written statement.
12 On the basis of the pleadings of the parties from the Ld. Predecessor of this court vide order dated 23.11.2004 framed the following issues for adjudication:-
1. Whether the plaintiff is entitled to the recovery of the suit amount alongwith costs and interest, as prayed in the plaint? OPP
2. Whether the suit of the plaintiff is not maintainable in view of the preliminary objection taken in the written statement by the defendants?OPD
3. Relief.
13 The plaintiff had filed an application under Order 6 Rule 17 CPC which was allowed vide order dated 13.09.2005 thereafter the Ld. Predecessor of this court vide order dated 05.08.2006 framed the following additional issues for adjudication:-
1. Whether the plaintiff is entitled for damages as per para 16A of amended plaint in alternative? OPP
14 In order to prove its case, plaintiff has examined Sh. Basant Kumar, Deputy General Manager, Accounts as PW-1 who reiterated the averment made in the plaint in his examination in chief. PW-1 exhibited PW-1 exhibited photocopy of certificate of incorporation as Ex.PW1/1, Board Resolution Ex.PW1/2, Special Declaration Policy as Ex.PW1/3, Excise Invoices No. 0625 Suit No. 548/09 Page no. 6 of 23 & 0626 Ex.PW1/4 and Ex.PW1/5 respectively. GRs No. 1012 and 1013 dated 15.09.1998 as Ex.PW1/6 and Ex.PW1/7 respectively. Meteorological report dated 01.03.2001 as Ex.PW1/8, Damage Certificate as Ex.PW1/9 and Ex.PW1/9A. Letter, postal receipt and acknowledgment as Ex.PW1/10 to 27, letter dated 20.03.2003 Ex.PW1/28, letter dated 14.07.2003 as Ex.PW1/29, reminder Ex.PW1/30, letter dated 28.07.2003 as Ex.PW1/31, Letter dated 17.08.2003 as Ex.PW1/32, Claim of the plaintiff with postal receipts Ex.PW1/33 to Ex.PW1/36 (Colly), Legal Notice dated 05.11.2003 as Ex.PW1/37, Postal receipts are Ex.PW1/38 and Ex.PW1/39 and Reply dated 01.01.2004 as Ex.PW1/40. PW-1 has been throughly cross-examined by ld. counsel for the defendant.
15 In order to answer the claim of the plaintiff, defendant has examined Sh. Amit Mishra as DW-1 who reiterated the averment made in the written statement in his examination in chief. DW-1 exhibited original GR 1012 ^ 1013 as DW-1/1 & 2, Survey report Ex. DW-1/3, Marin claim Ex. DW-1/4, Original claim bill Ex. DW-1/5, Notice dated 26.12.1998 alongwith postal receipt Ex. DW-1/6, Original damage certificate Ex. DW-1/7 & 8, Letter dated 20.3.2003 Ex. DW-1/9, Legal notice dated 5.11.2003 DW-1/10, reply dated 1.1.2004 Ex. DW-1/11, Joint Survey report dated 24.3.2000 Ex. DW-1/12, Photocopy of investigation report dated 30.9.2002 as Ex. DW-1/13.
16 The defendant has also examined Sh. Pawan Bhargwa from the surveyor office as DW-2 who proved survey report Ex. DW-1/3. Defendant has also examined Sh. Khushi Ram, Investigator as DW-3 who proved investigation report Ex. DW-1/13 dated 30.9.2002. All these witnesses have been throughly cross-examined by ld. counsel for the plaintiff.
Suit No. 548/09 Page no. 7 of 23 17 I have heard both the ld. Counsels for the parties and perused the
pleadings, evidence and documents and other material placed on record. My issue wise findings are as under:-
18 ISSUE NO. 1 Whether the plaintiff is entitled to the recovery of the suit amount alongwith costs and interest, as prayed in the plaint?OPP The plaintiff has taken a plea that it had taken a Marine Insurance policy for a sum of Rs.1,29 crores on 13.02.1998 from the defendant. The said policy was valid from 15.02.1998 to 14.02.1999. During the continuation of the said policy, plaintiff transported Polyster Chip on 15.09.1998 from Malanpur, Gwalior to its consignee M/s. Flex India Ltd. at NOIDA through M/s.
Malik Road Carrier vide GR's No. 1012 to 1013 dated 15.09.1998. There was heavy rain in the transit due to which the said consignment got damaged and same was rejected by the consignee. The plaintiff has further taken a plea that it informed the defendant about the damage sustained by them immediately on 18.9.1998, who appointed M/s. J.B. Boda Surveyor Pvt Ltd. as surveyor to assess the quantum of damages. The plaintiff supplied all the necessary documents as demanded by the surveyor but the defendant repudiated the claim of the plaintiff vide letter dated 20.03.2003. As per the plaintiff repudiation of its claim by the defendant vide letter dated 20.03.2003 is not valid in the eyes of law and same has been done malafidely.
19 The defendant has not disputed that plaintiff had taken a marine policy. It has also not disputed the validity of the said policy. The defendant has also not disputed that it received an intimation from the plaintiff on 18.09.1998 that their consignment vide GR's No. 1012 & 1013 dated 16.09.1998 reached in wet condition. The defendant has taken a plea that while processing the claim Suit No. 548/09 Page no. 8 of 23 of the plaintiff it found peculiar fact that all the consignment sent for reprocessing to Malanpur were found in extreme wet condition. As per the defendant, plaintiff had committed deliberate and willful breaches of the terms and conditions of the policy which disentitled them from claiming or receiving any compensation from the defendant.
20 In order to prove their case, both the parties have led their respective evidence.
21 An examination of the pleadings and evidence led on record clearly shows that plaintiff had taken a Marine Insurance Policy No. 2131100200912/768 dated 13.12.1998 from the defendant for a total assured sum of Rs. 1,29 crores for which plaintiff paid premium of Rs.13,12,583/-. The said policy commenced from 15.02.1988 and was valid upto 14.02.1999. During the continuation of the said policy, plaintiff dispatched a consignment of Polyester Chip to M/s. Flex Industries Ltd. vide GR No. 1012 and 1013 dated 16.09.1998. During transit those goods were damaged due to heavy rainfall, consequently the consignee rejected the goods and intimation of the damages being suffered by the plaintiff was given to the defendant who appointed M/s. J.B. Boda Surveyor Pvt. Ltd. to assess the loss suffered by the plaintiff.
22 The claim put forth by the plaintiff was repudiated by the defendant vide its letter dated 20.03.2003 Ex.DW-1/9 on the ground namely: (A) Breach of warranty with regard to engaging of reputed carriers. (B) Breach of warranty regarding use of water proof tarpaulin to cover the truck, inasmuch as old worn out tarpaulins with holes were used. (C) Delay and inaction on plaintiffs part deprived them of their recovery rights against the transporter Suit No. 548/09 Page no. 9 of 23 and (D) Reasonable doubts and suspicion regarding the genuineness of the claim put forward by plaintiff.
23 The defendant has repudiated the claim of the plaintiff vide letter dated 20.03.2003 Ex.DW-1/9 on various grounds. Let me examine each of the ground of repudiation of claim of the plaintiff by the defendant separately.
(A) Breach of warranty with regard to engaging of reputed carriers I. The defendant rejected the claim of the plaintiff on the ground that plaintiff had committed breach of warranty by not engaging a reputed carrier. As per the defendant they carried out investigation which suggested that no such transporter by the name of M/s. Mallik Road Carrier ever existed at the given address. The plaintiff has controverted the said plea of the defendant and claimed that it had engaged a reputed carrier for transporting the consignment from Malanpur to Noida.
II. The defendant has repudiated the claim of the plaintiff on the ground that plaintiff had not engaged the reputed carrier for the consignment thus committed breach of the warranty of the policy. The onus to prove the fact that plaintiff committed breach of warranty by not engaging a reputed carrier is upon the defendant. It was incumbent upon the defendant to prove on record by leading cogent evidence that plaintiff had failed to engage a reputed carrier for transporting the goods thus committed breach of warranty of policy. The defendant, however, has failed to place any material on record which can show or suggest that plaintiff had not engaged a reputed Suit No. 548/09 Page no. 10 of 23 carrier or that M/s. Mallik Road Carrier was a fictitious entity. III. The Hon'ble Supreme Court in a judgment titled "National Insurance Co. Ltd. Vs. Swaran Singh & Anrs reported as 2004(3) SCC 297 has held that "The preposition of law is no longer res integra that the person who alleges breach must prove the same. The insurance company is, thus, required to establish the said breach by cogent evidence. In the event the insurance company fails to prove that there has been breach of conditions of policy on the part of the insured, the insurance company cannot be absolved of its liability."
IV. The contract of insurance was entered into between the plaintiff and the defendant vide marine insurance policy. A perusal of policy clearly shows that defendant had not stipulated in the entire insurance policy that plaintiff was required to engage any particular carrier for transporting the goods from one destination to another destination. The only requirement of the policy was that plaintiff should engage a reputed transporter. It does not prescribed the name of any particular transporter through whom the goods were to be transported from one destination to another destination. V. The Defendant has disputed the very existence of the said carrier through whom plaintiff transported the consignment, but defendant has not led any evidence on record which can show or suggest that plaintiff while transporting the goods from Malanpur to NOIDA has not engaged a reputed carrier or that M/s. Mallik Road Carriers through whom the goods were transported by the plaintiff was not in existence. The Suit No. 548/09 Page no. 11 of 23 defendant though examined Sh. Khushi Ram DW-3 to show that the transport company was not in existence. The testimony of DW-3, however does not inspire confidence because he has not placed any material to show as to how he was appointed by the defendant. The DW-3 himself deposed that he did not got to any of the office of Malik Road Carrier except Delhi, U.P Border. He even did not provided any material on record to show that he carried out any investigation except his self-serving report which remained unsubstantiated as defendant has not placed any supporting material on record to show that the transport company was not in existence.
In view of the above facts and circumstances, I am of the considered view that defendant has failed to prove on record that plaintiff had not engaged a reputed carrier while transporting the goods. The defendant has thus failed to prove that plaintiff had committed any breach of warranty qua not engaging a reputed carrier. The defendant was thus not justified in repudiating the claim of the plaintiff on this ground.
(B) Breach of warranty regarding use of water proof tarpaulin to cover the truck, inasmuch as old out tarpaulins with holes were used.
I. The second ground for repudiating the claim of the plaintiff is that plaintiff had committed breach of terms and conditions of the policy by not using water proof tarpaulin over the carrier to protect the goods. The plaintiff has controverted the said plea in the corresponding para of the replication. II. An examination of the pleading and the evidence led on Suit No. 548/09 Page no. 12 of 23 record shows that plaintiff had taken a marine insurance policy Ex.PW1/3 from the defendant. The said policy was subject to certain terms and conditions. Warranted No. 5 of the said insurance policy provides that warranted truck to be covered with waterproof tarpaulin and carried by a reputed transporter under clean GR-RR-ARIWAY Bills. A perusal of the above stated warranty clearly shows that insurance policy obtained by the plaintiff was subject to the condition that plaintiff was required to cover the carrier through waterproof tarpaulin during transportation.
III. The defendant has taken a plea that tarpaulin used by the carrier while transporting the goods from Malanpur to NOIDA was not waterproof and there were holes in the tarpaulin sheet due to which water seeped inside the consignment and the entire consignment got damaged due to the seepage of water. As per the defendant the plaintiff had committed breach of the terms and conditions of the insurance policy, therefore, defendant has rightly repudiated the claim of plaintiff.
IV. To substantiate their plea the defendant has examined Sh. Amit Mishra, Senior Divisional Manager as DW-1 who deposed in para-9 in examination in chief that the truck was not covered with waterproof tarpaulin as per the requirement of their policy whereas the tarpaulin sheet were in fact found out with holes. He reiterated the above averment in para-10 in his examination in chief as well. The plaintiff has extensively cross examined DW-1, however, the aforesaid testimony of DW-1 remained unrebutted and uncontroverted Suit No. 548/09 Page no. 13 of 23 because plaintiff has not carried out any cross examination of DW-1 on this aspect. In the absence of any cross examination testimony of DW-1 deemed to have admitted by the plaintiff.
V. The defendant has also examined Sh. Pawan Bhargava, Surveyor as DW-2 who proved his survey report Ex.DW1/3. The said witness has been duly cross examined by the plaintiff. However, his testimony to the effect that tarpaulin sheets used were worn out and having holes in all trucks has not been challenged by the plaintiff through his cross examination. In cross examination whatsoever has been carried out by the plaintiff in this regard.
VI. It is also relevant that in survey report Ex.DW1/3 the surveyor has specifically mentioned that, "we found that the consignment in truck was cover with the tarpaulin and found that it was torn at 3-4 places".
VII.The plaintiff has not disputed the aforesaid fact mentioned in the survey report Ex.DW1/3 nor plaintiff has carried out any cross examination of DW-2 on the aspect that there were no holes in the tarpaulin sheets and water proof tarpaulin was used. In the absence of any cross examination of DW-2 on these aspect, I am of the considered view that plaintiff has admitted that tarpaulin used for covering the truck was having holes. The defendant has thus proved on record that plaintiff did not use waterproof tarpaulin while transporting the goods from one destination to another destination and there were holes in the tarpaulin due to which water seeped inside the consignment.
Suit No. 548/09 Page no. 14 of 23 VIII.As per the insurance policy Ex.PW1/3 one of the terms and conditions of the said policy was that the carrier used for transportation to be covered with waterproof tarpaulin. But in the instant case, defendant has proved on record that the tarpaulin was having holes on various places due to which water seeped into the consignment. The defendant has thus proved on record that plaintiff has violated one of the condition of insurance policy Ex.PW1/3.
IX. Once the defendant has proved on record that plaintiff committed breach of the condition of the insurance policy by not using appropriate water proof tarpaulin during transportation of the goods, the onus shifts upon the plaintiff to prove that in fact the said condition was not breached and the water proof tarpaulin was used by the plaintiff. However, plaintiff has not led any evidence whatsoever in this regard. Moreover, PW-1 who has examined herself as a sole witness of the plaintiff has admitted that he was not present when the consignment was transported from Malanpur to NOIDA. The plaintiff could have examined the transporter through whom the goods were transported through Malanpur to NOIDA to prove that it had used waterproof tarpaulin over the truck and the condition of the said tarpaulin was perfect. In the absence of any proof adduced by the plaintiff on these aspects, I am of the considered view that defendant has proved on record that plaintiff committed breach of warranty of Insurance policy Ex.PW1/3 by not using waterproof tarpaulin to cover the truck during transporting the goods from Malanpur to NOIDA. Therefore, plaintiff has violated Suit No. 548/09 Page no. 15 of 23 one of the essential terms and conditions of the Insurance Policy Ex.PW1/3 giving justification to the defendant to repudiate the claim of the plaintiff.
(C) Delay and inaction on plaintiffs part deprived us of the recovery rights against the transporter I. The onus to prove the above fact was upon the defendant. The plaintiff in the plaint as well as during evidence has categorically averred that intimation of damages was given to the defendant on 18.09.1998. It is also relevant that DW-1 during his examination in chief has admitted that the intimation of loss in respect of claim in suit was received by the defendant on 18.09.1998. The aforesaid testimony of DW-1 thus clearly shows that there were no delay on the part of the plaintiff which deprived defendant of their recovery right against the transporter.
II. The plaintiff suffered loss on 16.09.1998 and the intimation of the said loss was conveyed to the defendant on 18.09.1998 as deposed by DW-1 himself. Therefore, there was no delay on the part of the plaintiff in making communication about damage suffered by it. The defendant has not led any evidence which can show or suggest that plaintiff has caused any delay or inaction which deprived them of their right of recovery against the transporter. The defendant has thus failed to prove on record that plaintiff has caused any delay in intimating the loss to the defendant. The defendant was thus not justified in repudiating the claim of the plaintiff.
Suit No. 548/09 Page no. 16 of 23
(D) Reasonable doubts and suspicion regarding the
genuineness of the claim put forward by plaintiff.
I. The onus to prove the aforesaid fact was upon the defendant, however, defendant has not led any evidence whatsoever in this regard. The plaintiff has examined Sh. Basant Kumar as PW-1 in support of its case. The defendant has carried out extensive cross examination of PW-1, however, defendant has not given any suggestion or carried out any cross examination of PW-1 qua the aforesaid plea being taken by the defendant for repudiating the claim of the plaintiff. In the absence of any cross examination or confrontation of PW-1 the plea of the defendant was that there was reasonable doubt and suspicion regarding the genuineness of the claim of the plaintiff remained unsubstantiated and unproved.
II. The defendant has failed to prove on record that there were reasonable doubts and suspicion regarding the genuineness of the claim put forth by the plaintiff. The defendant could not have repudiated the claim of the plaintiff on this ground as well.
24 In view of my aforesaid discussion, I am of the considered view that defendant has failed to prove on record that plaintiff has committed breach of warranty by not engaging a reputed carrier for transporting goods from one destination to another destination. The defendant has also failed to prove on record that plaintiff has caused any delay which deprived the defendant of Suit No. 548/09 Page no. 17 of 23 their recovery right against the transporter or that the claim put forth by the plaintiff was not genuine and there was reasonable doubt and suspicion regarding the genuineness of the claim put forth by the plaintiff. But the defendant has proved on record that plaintiff has committed breach of terms and conditions of Insurance policy by not using waterproof tarpaulin to cover the trucks during transportation. The plaintiff has committed a breach of warranty of the insurance policy Ex.PW1/3 by not using waterproof tarpaulin to cover the truck which was one of the essential terms of the contract. The plaintiff has thus violated the essential terms of the contract due to which defendant was justified in repudiating the claim of the plaintiff vide letter of repudiation Ex.DW1/9. The plaintiff is thus not entitled to recover the suit amount along with the interest from the defendant. The plaintiff has failed to discharge the onus of Issue No. 1, same is accordingly decided against the plaintiff.
25 ISSUE NO. 2 Whether the suit of the plaintiff is not maintainable in view of the preliminary objection taken in the written statement by the defendants?OPD The defendant has taken a plea in the written statement that plaintiff has committed deliberate and willful breach of the terms and conditions and warranty under the policy. They have further taken a plea that claim put forth by the plaintiff is false. The plaintiff has controverted the aforesaid preliminary objection in the corresponding para of the replication. 26 While deciding Issue No. 1, I have already held that plaintiff committed breach of warranty by not using waterproof tarpaulin over the truck which was in violation of Insurance Policy Ex.PW1/3. However, the plea regarding the reasonable doubt and suspicion regarding the genuineness of the claim put forth by the plaintiff has been.
Suit No. 548/09 Page no. 18 of 23 27 The Defendant has further taken a plea that claim put forth by the
plaintiff was rejected on 20.03.2003 and as per the terms and policy unless an action was initiated within 12 calender month thereof, all remedy of the plaintiff to recover any amount were stand extinguished. As per the defendant the plaintiff has filed the suit beyond the prescribed period of limitation. The said averment has been has been controverted by the plaintiff in the corresponding para of the replication.
28 The defendant has taken a plea that present suit has been filed after the prescribed period of limitation. The said objection taken by the defendant in the written statement is not sustainable for the simple reason that defendant repudiated the claim of the plaintiff on 20.03.2003. As per the defendant themselves the suit could have been filed within a period of 12 calender month i.e. up to 20.03.2004. Whereas the instant suit has been filed on 19.03.2004 i.e. within 12 calender month from the date of repudiation of the claim on 20.03.2003. The said objection is therefore, not maintainable.
29 The defendant further taken a preliminary objection that plaintiff has no locus standi to file the present suit because the contract of Insurance was entered into by M/s. Flex Chemical Ltd. whereas the present suit has been filed on behalf of the M/s. Flex Technology. The defendant has further taken a plea that M/s. Flex Chemical Ltd. is necessary and proper party and the suit has not been filed and verified by the competent and authorized person on behalf of the plaintiff. The averment of the aforesaid preliminary objection have been controverted by the plaintiff in the corresponding para of the replication.
Suit No. 548/09 Page no. 19 of 23 30 A perusal of the material placed on record shows that plaintiff has taken
a plea in para-1 of the plaint that plaintiff company was earlier known as M/s. Flex Chemical Ltd. however, its name was subsequently changed to M/s. FCL Technologies Ltd. vide certificate of incorporation dated 28.04.2000. It has further averred that Mr. Basant Kumar was Deputy General Manager who is duly authorized by the company to sign and verify the present suit.
31 In order to substantiate the aforesaid averment, plaintiff has examined Sh. Basant Kumar as PW-1 who reiterated the said fact in para-1 & 2 of his examination in chief. PW-1 has also placed on record certificate of incorporation dated 28.04.2000 as Ex.PW1/1 and Board Resolution passed in his favour as Ex.PW1/2. PW-1 has been thoroughly cross examined by the defendant. However, the above testimony made by PW-1 in his examination in chief remained unrebutted and uncontroverted because defendant has not carried out any cross examination whatsoever of PW-1 on this aspects. In the absence of any cross examination the defendant deemed to have admitted the testimony of PW-1 made in para-1 in his examination in chief. Defendant has not placed any material on record which can show or suggest that plaintiff has no locus standi to file the present suit or that Mr. Basant Kumar not duly authorized on behalf of the plaintiff to institute the present suit. Therefore, defendant has failed to prove on record that plaintiff has no locus standi to file the suit or that M/s.Flex Chemicals Ltd. was the necessary party or that the suit was not been filed by duly authorized person.
32 In view of the aforesaid facts and circumstances, I am of the considered view that defendant has proved on record that the plaintiff has committed breach of terms and conditions and warranty of Insurance of Policy Ex.PW1/3 by not using waterproof tarpaulin while transporting goods from Malanpur to Suit No. 548/09 Page no. 20 of 23 NOIDA. But defendant has failed substantiate the averment of other preliminary objection taken by it in the written statement. Issue No. 2 is accordingly decided.
33 ADDITIONAL ISSUE Whether the plaintiff is entitled for damages as per para 16 A of amended plaint in alternative? OPP The plaintiff has taken a plea in para 16A of the plaint that it submitted its claim on 18.09.1998. The said claim was repudiated by the defendant vide letter dated 20.03.2003 after 4 and ½ years. As per the plaintiff, it issued notice to the transporter on 26.12.1998 within the prescribed period of 6 months under Section 10 of Carriers Act 1865. The plaintiff made several communications to the defendant to make payment in accordance of its claim but despite assurances, the defendant repudiated the claim of the plaintiff after the lapse of 4 and 1/2 years. Due to the inordinate delay of 4 and ½ years on the part of the defendant in communicating their decision, the plaintiffs right to recover damages from the transporter got extinguished. As per the plaintiff, the defendant is liable to compensate the damages suffered by the plaintiff. The defendant has controverted the aforesaid plea of the plaintiff.
34 An examination of the pleadings and evidence led on record clearly shows that the plaintiff dispatched the consignment from Malanpur to NOIDA on 15.09.1998 vide GR No. 1012-1013. The said consignment was dispatched through M/s. Malik Road Carriers in truck No. UP-78N-7798. The said consignment was badly damaged in the transit due to heavy rain. Therefore, the said consignment was rejected by the consignee. The plaintiff communicated the factum of damage to the defendant on 18.09.1998 who appointed M/s. J.B. Boda Surveyor Pvt Ltd as surveyor to assess the Suit No. 548/09 Page no. 21 of 23 quantum of damages. The said surveyor submitted its report Ex.DW1/3 dated 21.05.99. The defendant repudiated the claim of the plaintiff vide letter dated 20.03.2003 Ex.DW1/9.
35 The defendant has not placed any material to show as to why they had not taken any action over the claim of the plaintiff within a reasonable time. The claim of the plaintiff was assessed by the surveyor vide its report Ex.DW1/3. The aforesaid claim of the plaintiff could have been decided by the defendant within a reasonable time. However, defendant has caused immense delay in repudiating the claim of the defendant.
36 The defendant should have decided the claim of the plaintiff within a reasonable time after receiving the survey report Ex.DW1/3. The defendant, however, repudiated the claim of the plaintiff on 20.03.2003 vide Ex.DW1/9 thus caused inordinate delay in repudiating the claim of the plaintiff which was submitted on 18.09.1998. But the delay caused by the defendant in deciding the claim of the plaintiff itself is not sufficient to held the defendant liable for compensation. The plaintiff was also under an obligation to take reasonable steps against the transporter whom the fault was attributed by the surveyor vide its report Ex.DW1/3. But plaintiff beside issuing a notice, has not taken any action against the transporter for seeking damages for their negligence in transporting the goods by not covering the carrier through water proof tarpaulin.
37 Even at the time of filing of the suit the plaintiff has chosen not to file the suit against the transporter who was negligent in transporting the goods from Malanpur to NOIDA without covering the consignment through water proof tarpaulin thus committed breach of warranty of Insurance Policy Ex.PW1/3.
Suit No. 548/09 Page no. 22 of 23 No doubt that defendant had caused inordinate delay in deciding the claim of the plaintiff which should have been decided within a reasonable time period but the defendant cannot be held liable to compensate the damages suffered by the plaintiff only on the ground of delay caused by the defendant in repudiating the claim of the plaintiff.
38 In view of the above facts and circumstances, I am of the considered view that although the defendant has caused delay in repudiating the claim of the plaintiff which should have been decided within a reasonable time. However. on this ground alone, the defendant cannot be held liable to compensate the plaintiff for the damages suffered by it due to the negligence of the transporter. The plaintiff has thus failed to discharge the onus of additional issue, same is accordingly decided against the plaintiff.
39 Relief In view of the above, the suit filed by the plaintiff for recovery of Rs. 19,04,767/- along with interest is dismissed. However, both the parties shall bear their cost respectively. Decree sheet be accordingly prepared. File be consigned to record room after due compliance.
Announced in the open court (PITAMBER DUTT)
On the 03.07.2014 Additional District Judge
Delhi
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