State Consumer Disputes Redressal Commission
Sudarshan Blanket House vs Export Credit Guarantee Corporation Of ... on 14 August, 2015
2nd Additional Bench
STATE CONSUMER DISPUTES REDRESSAL COMMISSION, PUNJAB
DAKSHIN MARG, SECTOR 37-A, CHANDIGARH
Consumer Complaint No. 63 of 2012
Date of institution: 1.8.2012
Date of Decision: 14.8.2015
Sudarshan Blanket House, 19-A, Near Telephone Exchange, Shahtri
Market, Amritsar, through its Proprietor Shri Inderjit Singh.
.....Complainant
Versus
Export Credit Guarantee Corporation of India Limited, through its
Authorized Representative, B.O. Gobind Niwas IInd Floor, 36 G.T. Road,
Jalandhar - 144 001.
.....Opposite Party
Consumer Complaint under Section 17 of the
Consumer Protection Act, 1986.
Quorum:-
Shri Gurcharan Singh Saran, Presiding Judicial Member
Shri Jasbir Singh Gill, Member
Mrs. Surinder Pal Kaur, Member
Present:-
For the complainant: Sh. Munish Goel, Advocate
For the OP : Sh. B.B. Bagga, Advocate
Gurcharan Singh Saran, Presiding Judicial Member
ORDER
The complainant Sudarshan Blanket House (hereinafter called "the complainant") has filed the present complaint under Section 17 of the Consumer Protection Act, 1986 (in short 'the C.P. Consumer Complaint No. 63 of 2012 2 Act') on the averments that the complainant is running the partnership firm under the name and style of Sudarshan Blanket House since 2001 to earn his livelihood by means of self employment and is exporting goods /dress material to the foreign buyers. He took policy from OP on 31.12.2001 covering the risk of exporting the goods to foreign buyers. In continuation of earlier policies, he purchased an insurance policy from OP for the period 1.1.2008 to 31.12.2009 with a cover up to Rs. 20 lacs on paying the requisite premium. It was further averred that the complainant submitted credit limit application with Op on 11.12.2001 on the basis of which the insurance policy was being issued by Op from time to time as referred above. The complainant was sending the shipment and exporting the material to foreign buyer, namely, M/s Bhatti Enterprises, Vancouver, Canada since 2001. The complainant received an order dated 27.3.2009 from Sudershan Cloth House (earlier known as M/s Bhatti Enterprises) and accordingly, vide invoice dated 27.3.2009 cloth worth 18795.09 Canadian Dollars was sent in favour of Sudershan Blanket House. The complainant received another order dated 3.7.2009 and accordingly, he vide invoice dated 3.7.2009 goods worth Rs. 33183.2 Canadian Dollars were sent to Sudershan Blanket House. Unfortunately, against the shipment dated 27.3.2009 and 3.7.2009 payment was not received from the buyer within 90 days period. Against shipment dated 27.3.2009, a letter dated 20.6.2009 was received from Sudershan Cloth House that due to recession all over Canada the buyer was unable to make the payment. Against the shipment dated 3.7.2009, which was due as on 19.10.2009, on Consumer Complaint No. 63 of 2012 3 25.9.2009 a letter was received from the buyer that he was unable to make the payment due to recession all over Canada. The complainant gave intimation to the Bank and the Bank gave the extension. The complainant informed OP and then lodged the claim for a sum of Rs. 21,28,939/- whereas Op intimated that there was delay in declaration of shipment and sought clarification vide letter dated 9.12.2009. OP further asked to contact MAH International and High Commission of India at Canada. Accordingly, the complainant replied vide letter dated 14.12.2009 to OP that they were hopeful of receiving the payment and extension was sought by the buyer and information for the same was given to the Bank to grant extension and that they had also applied to M/s MAH International GMBH and High Commission of India in Canada. However, vide their letter dated 9.12.2009 replied to the complainant that the complainant can lodge the claim within a period of 24 months from the date of concerned bill and accordingly, he lodged the claim vide letter dated 24.12.2009. Again the complainant received the letter dated 14.1.2010 and 21.1.2010 from Op in which they raised number of queries, which were replied by the complainant vide letter dated 29.1.2010 stating that he was already declared in credit limit application that buyer is related to him and that he is dealing with him for the last 10 years. At the same time, the complainant was trying his level best to get the payment from the buyer, however, the complainant received mail dated 12.9.2010 that he was unable to pay the amount. Op again raised the objection and sought clarification from the complainant qua the association of buyer and seller and the complainant vide letter Consumer Complaint No. 63 of 2012 4 dated 16.12.2012 informed that he had only business relation with the buyer for the last 10 years. The complainant then received another letter dated 25.4.2011 from Op in which again number of objections were raised that declaration with regard to shipment for October, 2008 till February, 2009 was submitted on 23.4.2009 and other objections was that two shipments were overdue at the time of submission of credit limit application. The shipment dated 31.5.2008 was due on 29.8.2008 and was 65 days overdue at the time of credit limit and the shipment dated 15.7.2008 was 21 days overdue at the time of credit limit application. The complainant again replied vide his letter dated 28.4.2011 that the buyer was one of their family members and that the complainant had only business relations with the buyer and the declaration for the period October, 2008 to February, 2009 were overdue for more than 30 days has been inadvertently wrongly mentioned by the Accountant of the firm and it was just a clerical mistake. However, Op vide letter dated 3.10.2011 repudiated the genuine claim of the complainant, which is illegal as the complainant had informed regarding the earlier shipments remaining overdue in time. The shipment dated 27.3.2009 was discharged from the port on 30.3.2009 with 90 days credit limit, which expired on 1.7.2009. Whereas the second shipment was made on 3.7.2009 and was discharged from the port on 6.7.2009, therefore, there was no gap / time to ascertain that there will be default in the payment of shipment by the foreign buyer, therefore, there was no violation of the clauses of policy terms and conditions, which allowed the Op to decline the genuine claim of the complainant and no shipment was made to the Consumer Complaint No. 63 of 2012 5 foreign buyer after 3.7.2009. The act of repudiation of the genuine claim of the complainant amounted to deficiency in services on the part of Op. Accordingly, the present complaint has been filed by the complainant against Op seeking direction to Op as under:-
a) to quash repudiation letter dt. 3.10.2011 and further to pay Rs. 7,51,836/- and Rs. 13,77,103/- alongwith interest from the date of shipment i.e. 27.3.2009 and 3.7.2009, (being the amount of shipment made to the foreign buyer which has not been paid by him) till its realization;
b) to pay Rs. 5,00,000/- on account of compensation for causing mental tension, harassment and mental agony to the complainant; and
c) to pay Rs. 33,000/- as cost of litigation.
2. The complaint was contested by OP, who filed written reply taking preliminary objections that the Government of India had set-up Export Risks Insurance Corporation (ERIC) in July, 1957, which was changed into Export Credit and Guarantee Corporation Limited in 1964 and in 1983 Corporation name was again changed as Export Credit Guarantee Corporation of India(hereinafter referred as ECGC), which is incorporated under the Companies Act, 1956 and the covers issued by Op is always subject to strict compliance of terms and conditions. The complainant Mr. Inderjit Singh, Partner had signed the proposal form on 18.1.2001 for issuance of shipments (Comprehensive Risks) policy in which the names of associate concern were not provided and shipment comprehensive risk policy bearing No. F/SCR/01/82677 dated 31.12.2001 was issued for the Consumer Complaint No. 63 of 2012 6 period 18.12.2001 to 31.12.2003 with maximum liability for Rs. 15 lacs and this policy was renewed on 2.3.2004 and names of the partners were mentioned without any surname and word 'No' was mentioned against the associated/sister concerns and policy No. SCR 0120001658 for the period 1.1.2004 to 31.12.2005 was issued with maximum liability of Rs. 15 lacs. The complainant again submitted proposal form for renewal of the said policy on 16.1.2006 and policy No. SCR 0120001658 was issued for the period 1.1.2006 to 31.12.2007 with maximum liability of Rs. 15 lacs. Complainant again submitted a proposal for renewal of the policy on 22.1.2008 and policy No. SCR 0120001658 was renewed for the period 1.1.2008 to 31.12.2008 with maximum liability of Rs. 15 lacs. In case the declarations were found to be incorrect then the policy would become void. In the present case, the complainant knowingly concealed the surname Bhatti of partners in the proposal form submitted for issuance of the said policy as the buyer was also Mr. Sudarshan Bhatti and related to the complainant. On 12.6.2009, the complainant submitted an application for increase in maximum limit under the policy from Rs. 15 lacs to Rs. 20 lacs wherein under Column No. 12, it was mentioned that "no bills were overdue" and the payment of shipment dated 27.3.2009, for which the claim was lodged with OP was realized on 7.4.2009, therefore, on the basis of wrong and incorrect information, the policy was rendered void. Then it was the responsibility of the insured/complainant to submit declaration of shipments of overdue payments under Clause 8 and 10 of the policy before 15th day of each calendar month but it was not so Consumer Complaint No. 63 of 2012 7 given and under Exclusion Clause No. 19, in case the insured failed and neglected to duly declare in time in strict compliance with the requirements, the Corporation shall cease to have any liability. In the instant case, delay was for 51 days and 114 days. Under Clause 7 of the terms and conditions of the policy, the complainant was under
obligation to use all reasonable care and foresight to prevent or minimize the loss. In case the payment of the shipment of March, 2009 was not received before 27.6.2009 then there was no reason for the complainant/insured to send further shipment on 6.7.2009 to the borrower. Further with regard to invoice No. 001 dated 26.5.2008 worth Rs. 10,71,448/- in favour of Sudarshan Cloth House was realized on 10.11.2008 whereas the due date was 2.9.2008, therefore, on the day of filing the claim, the amount in respect of preceding shipment was overdue for payment. In order to conceal this fact, the complainant in the credit limit application dated 29.10.2008 mentioned as "N.A." in column No. 8, which was gross suppression of facts. The representations of the complainant were duly replied vide letter dated 17.6.2010, 25.4.2011 and 3.10.2011.
The cheque dated 11.6.2009, which was issued towards the premium of the policy was returned by the Canara Bank vide its memo dated 27.6.2009, therefore, the complainant had failed to pay the premium within time for enhanced policy. The claim of the complainant was repudiated on the ground of delay in declaration. Noting and Protesting of the bills was not made. Agreement was not signed with DCA M/s MAH International GMBH, Swizerland. Extension approval was not sought from OP. Surname of the persons in the management Consumer Complaint No. 63 of 2012 8 of the complainant firm "Bhatti" was not revealed and second shipment was made after the due date of first shipment. On merits, the issuance of the policy was admitted. Otherwise the points raised in the preliminary objections were reiterated. The complainant has failed to comply with the terms and conditions of the policy. It was submitted that the claim was rightly repudiated keeping in view the conduct of the complainant and violation of the terms and conditions of the policy. Complaint is without merit and it be dismissed.
3. The parties tendered their respective evidence in support of their pleadings.
4. In support of his allegations, the complainant had tendered into evidence his affidavits Exs. C-A & B, credit limit appl. Ex. C-1, policies Ex. C-2 & 3, invoice Ex. C-4, airway bill Ex. C-5, Form-A Ex. C-6, shipping bill Ex. C-7, Indian Custom Clearance Ex. C-8, invoice Ex. C-9, air way bill Ex. C-10, Form A Ex. C-11, shipping bill Ex. C-12, Indian Custom Clearance Ex. C-13, letter from buyer Ex. C-14 & 15, shipment Ex. C-16, letter from Op Ex. C-17, letter from complainant Ex. C-18, letter to High Commission Ex. C-19, letter from OP Ex. C-20, letter from complainant Ex. C-21, letter from OP Ex. C-22 & 23, letter from complainant Exs. C-24 & 25, letter from buyer Ex. C-26, letter from complainant Ex. C-27, letter from OP Ex. C-28, letter from complainant Ex. C-29, letter from Op Ex. C-30, Canara Bank Account Statement Ex. C-31, receipt Ex. C-32, authority letter Ex. C-33. On the other hand, OP had tendered into evidence affidavit of Augustus, Branch Manager Ex. OP-A, proposal forms Exs. Op-1 to 4, credit limit application Ex. OP-5, application for increase in Consumer Complaint No. 63 of 2012 9 maximum liability Ex. Op-6, declarations Ex. Op-7, letter Ex. Op-8, export statement Ex. Op-9, credit limit appl. Ex. Op-10, letter of the Op Ex. Op-11, letter Ex. Op-12, letters Ex. Op-13 to 17, communication Ex. Op-18, returning memo Ex. Op-19.
5. We have heard the learned counsel for the parties.
6. It has been argued by the counsel for the complainant Mr. Munish Goel, Advocate that to support the contentions of comlaint there is affidavit of Inderjit Singh, Proprietor of the complainant firm Exs. C-A & B, Ex. C-1 is the credit limit application dated 11.12.2001 and Ex. C-2 is the policy i.e. comprehensive risk policy for the period 18.12.2001 to 31.12.2003 was issued after paying the premium of Rs. 10,000/- and coverage was Rs. 15 lacs. Ex. C-3 is the renewal for the period 1.1.2008 to 31.12.2009, invoice dated 27.3.2009 is Ex. C-4, airway bill is Ex. C-5, bill attached with Form-A Ex. C-6, shipping bill Ex. C-7 and invoice for payment of Indian Custom Clearance Ex. C-8, invoice dated 3.7.09 Ex. C-9, air way bill Ex. C-10, Ex. C-11 is Form A, shipping bill Ex. C-12, Ex. C-13 copy of Indian Custom Clearance dated 10.7.2009,Ex. C-14 is the letter received from buyer for extension of 3 months on account of recession in the market in Canada, Ex. C-15 is another letter dated 25.9.2009 vide which the extension for the period of 90 days has been sought for, Ex. C-16 is Form No. 205, Ex. C-17 is the letter dated 9.12.2009 from Op vide which the complainant was asked to explain the reasons for non- payment by getting the bill noted and protested through a Notary, Ex. C-18 is the letter from complainant explaining that they were hopeful of receiving the payment as the extension was being sought by the Consumer Complaint No. 63 of 2012 10 Overseas buyer due to recession in the world market, same was given to the bank and bank had extended it. Ex. C-19 is the letter to High Commission of India, Canada regarding overdue of payment against Sudarshan Cloth House, Canada, Ex. C-20 is the letter by OP asking the complainant that they can lodge their claim within 24 months from the date of invoice, Ex. C-21 is the letter issued by the complainant vide which the claim was lodged by the complainant with OP amounting to Rs. 21,28,939/-, Ex. C-22 is the letter from OP to give the reasons for late declaration, airway statement from 30.3.2007 to 30.3.2009 duly attested by the bank, reasons for not noting and protesting the bill of exchange, reasons for extending the period without notice of OP, copy of the correspondence with the buyer whether any agreement was signed with the Debt Collecting Agency M/s MAH International GMBH, Swizerland, reply, if any, received from High Commission of India, Ex. C-23 is letter dated 21.1.2010, the complainant was further asked to send the self attested copies of the KYC forms and PAN of all partners and the company, telephone/electricity bill (not older than 6 months), Ex. C- 24 is the letter dated 29.1.2010 vide which the complainant submitted to OP that they have already declared that the buyer was associated with him and that they have only the business dealing for the last 10 years and this default was only due to the recession in the market, copies of the self attested PAN Card and Electricity Bills were submitted; vide another letter dated 29.1.2010 Ex. C-25 it was submitted that by oversight the declaration was made later, they have not received the cancellation of the said credit limit and Bhatti Consumer Complaint No. 63 of 2012 11 Enterprises has changed their name to Sudershan Cloth House. They were getting the payment from the buyers as he was good for the last 10 years. The bank had already returned the documents that noting and protesting is not viable. They had applied for the extension with the bank and they had extended it. Vide letter Ex. C-26, the buyer stated that they were unable to make the payment. Vide letter dated 16.12.2010 Ex. C-27 vide which request was made to OP for clearance of his claim. Ex. C-28 is the letter from OP vide which some more information was sought from, which was replied vide letter Ex. C-29 and vide letter dated 3.10.2011 Ex. C-30, the claim was repudiated. Ex. C-31 is the statement of the Canara Bank of various transactions with Sudarshan Blanket House datewise and Ex. C-32 is the receipt issued by ECGC.
7. It has been argued by the counsel for the complainant that no doubt that there was some delay on the part of the complainant to submit the declaration as per the terms and conditions of the policy but there was reason for it because the complainant had a business dealing with the overseas buyer for the last about 10 years and except these two transactions, there was no problem, therefore, he was hopeful of the payment and due to this reason, there was delay in submitting the declaration. Otherwise copy of terms and conditions was not received by the complainant, therefore, he was not aware about the terms and conditions of the policy to which date the declaration was to be submitted. With regard to other objections, there is no violation of the terms and conditions of the policy of OP. The purpose of issuance of this policy is to save the Consumer Complaint No. 63 of 2012 12 parties, whose creditor were not in a position to pay the amount and due to this reason the overseas buyer due to recession throughout the world was unable to make this payment. The claim was payable but it has been rejected on a flimsy and technical grounds and accordingly, it was submitted that the claim was payable, which was wrongly repudiated by OP. Complaint be accepted alongwith interest and compensation.
8. Whereas the counsel for OP has contended that the claim of the complainant was repudiated on the grounds that there was delay in submitting the declaration. In case any time was extended, it was extended without approval of the Corporation. The complainant did not take proper care and caution while dealing with the overseas buyer despite the fact that payment of first shipment was not cleared, he despatched the second shipment. The complainant concealed the material fact with regard to his earlier shipment while applying for credit on 29.10.2008. The complainant also failed to disclose his surname "Bhatti" and his relationship with overseas buyer. The bills were not noted and protested through notary, it all is in violation of the terms and conditions of the policy, therefore, the claim was rightly repudiated by the Op. Complaint is without merit, therefore, it be dismissed.
9. Firstly dealing with the preposition whether the complainant had received terms and conditions of the policy when the policy was taken by the complainant. In case we go through the pleadings of the parties referred above, the first policy was taken w.e.f. 18.12.2001 to 31.12.2003 and it was got extended from time to Consumer Complaint No. 63 of 2012 13 time and last renewal/extension was on 22.1.2008 w.e.f. 1.1.2008 to 31.12.2009. In case the complainant is getting the policy for the last more than 8 years then it is not believable that he does not know the policy terms and conditions. He is exporter of goods to overseas buyers, therefore, he is a businessman and certainly, one will intend to know the terms and conditions of such a policy. Further our Constitutional Bench of our Hon'ble Apex Court reported in 1966 (7) CPSC 44 "General Assurance Society Limited versus Chandmull Jain" observed in para No. 11(relevant extract) as under:-
".....The policy not only defines the risk and its duration but also lays down the special terms and conditions under which the policy may be enforced on either side. Even if the letter of acceptance went beyond the cover notes in the matter of duration, the terms and conditions of the proposed policy would govern the case because when a contract of insuring property is complete, it is immaterial whether the policy is actually delivered after the loss and for the same reason the rights of the parties are governed by the policy to be, between acceptance and delivery of the policy. Even if no terms are specified the terms contained in a policy customarily issued in such cases, would apply."
Therefore, we are of the opinion that it is not believable that the complainant was not in the knowledge of terms and conditions of the policy issued by OP.
10. No doubt that the goods were sent by the complainant to overseas buyers Sudarshan Blanket House, Vancouver, Canada, as Consumer Complaint No. 63 of 2012 14 per the bills and custom clearance and it has been accepted by the buyer, who had sought for extension in payment due to recession in the world, therefore, he was unable to make the payment, therefore, on the basis of evidence produced on the record by the complainant, it stand proved on the record that the goods were sent to the overseas buyers vide invoice dated 27.3.2009 worth 18795.9 Canadian Dollar and vide invoice dated 3.7.2009 worth 33183.20.
11. Now on the basis of repudiation letter, we have to see whether the complainant has violated the terms and conditions of the policy. Some of the policy conditions are relevant to refer here:-
"Clause No. 1 Proposal and Declaration : The Proposal and the Declaration therein shall be the basis of this Policy and shall form part thereof and if any of the statements contained in the Proposal or the Declaration be untrue or incorrect in any respect, this Policy shall be void but the Corporation may retain any premium that has been paid.
2. Disclosure of facts : Without prejudice to any rule of law it is declared that this Policy is given on condition that the Insured has at the date of issue of this Policy disclosed and will at all times during the operation of this Policy promptly disclose all facts in any way affecting the risks insured.
xxxx xxxxx xxxxx xxxx
7. Obligations of the Insured : The Insured shall :
(a) use all reasonable and usual care, skill and forethought and take all practicable measures, including any measures which may be required by the Corporation, (including if so Consumer Complaint No. 63 of 2012 15 required the institution of legal proceedings) to prevent or minimise loss:
(b) notify to the Corporation in writing of the occurrence of any event likely to cause a loss without delay but in no case later than 30 days of his becoming aware of any such occurrence:
(c) exercise his right to stop the goods in transit from being delivered and stop shipment of further consignments unless the Corporation consents in writing to his refraining from so doing if, during the course of transit of goods, it should come to the Insured's knowledge that a country
(i) has banned the import of goods contracted for, or
(ii) has ordered confiscation of the goods, or
(iii) has any circumstances existing in it which may lead to any loss."
8. Declarations :
(a) Declarations of shipments : On or before the 15th day of each calendar month, the insured shall deliver to the Corporation a declaration, in the form prescribed by the Corporation, or all shipments made by him during the previous month. If no shipment has been made during a month, a 'NIL' declaration shall nevertheless be submitted.
(b) Declaration of overdue payments : The Insured shall also deliver to the Corporation, on or before the 15th of every month, a declaration in the form prescribed by the Corporation, of all payments which remained wholly or partly unpaid for more Consumer Complaint No. 63 of 2012 16 than 30 days from the due date of payment till the end of the previous month, in respect of shipments made during the policy period and such declarations shall continue to be delivered to the Corporation even after the expiry of the policy period so long as any such payment remains overdue.
(Note : The Insured shall also furnish the Corporation promptly with any further information that the Corporation may from time to time require in respect of the shipments effected by him during the policy period).
xxxx xxxxx xxxxx xxxx
19. Exclusion of Liability : Notwithstanding anything to the contrary contained in this Policy, unless otherwise agreed to by the Corporation in writing, the Corporation shall cease to have any liability in respect of the gross invoice value of any shipment or part thereof, if:
(a) the Insured has failed to declare, without any omission, all the shipments required to be declared in terms of clause 8(a) of the Policy and to pay premium in terms of clause 10 of the Policy:
(b) the Insured has failed to submit declarations of overdue payments as required by clause 8(b) of the Policy; or
(c) In cases where payment terms are cash against documents, documentary sight draft or documents against payment, the insured has authorised release of the documents and/or the goods to the buyer, either on any other terms of Consumer Complaint No. 63 of 2012 17 payment or against a deposit in the currency of the buyer's country.
12. The claim of the complainant was repudiated vide letter dated 3.10.2011 Ex. C-30 on the grounds that the first shipment dated 30.3.2009 declared late by 58 days and the second shipment dated 3.7.2009 was late by 114 days. The payment was required to be made within 90 days but it was not made within 90 days. As per Clause 8, monthly declaration was required to be filed within 15 days of each calendar month. Even if no shipment has been made during the month, then 'NIL' declaration was required to be submitted. According to Clause8(b), in case the payment from the buyer was wholly or partly unpaid after having become overdue for not less than 30 days as at the close of the preceding month and shall continue to deliver such declarations of overdue payments so long as any such payment remained outstanding. Certainly, the declaration was not filed within the time as prescribed under the policy. Therefore, in that way, he has violated the Clause 8 of the terms and conditions of the policy. This delay in declaration has also been admitted by the complainant in his letter Ex. C-25.
13. It is next contended that noting and protesting through a Notary was not made by the complainant. A reference can be made to the letter dated 29.1.2010 Ex. C-25 wherein it has been submitted by the complainant that bank had returned the documents and the expenses for noting and protesting being not viable, however, no document submitted to the bank for noting and protesting and response of the bank that it is not viable alongwith this letter. Consumer Complaint No. 63 of 2012 18 Therefore, the conclusion can be drawn in the absence of any document on the record that the complainant had failed to lodge noting and protesting through notary as per the directions given by the Op. No doubt that the complainant had written a letter to the High Commission of India Ex. C-29 but its reply, if any, received from the High Commission of India has not been placed on the record. It is not averred that no reply was received from High Commission of India. Then no agreement was signed with DCA M/s MAH International GMBH, Swizerland. As no document with regard to that fact has been placed on the record. Therefore, the complainant has failed to lodge the claim with appropriate authority as directed by the Op to get the payment, therefore, there is violation of Clause 7 of the terms and conditions that the insured will take reasonable and usual care, skill and forethought and take all practicable measures, including any measures which may be required by the Corporation to prevent or minimise loss and the measures that the Corporation may require the Insured to take may include advice to bring back to India the goods that were exported but not delivered to or accepted by the buyer, to institute legal proceedings against the buyer or anyone else to take control of the goods and/or to recover costs and damages.
14. The reasonable care and precaution has also not been taken by the complainant while sending the second shipment to the overseas buyer. As is clear from the first invoice Ex. C-4 dated 27.3.2009 and within 90 days the payment was to be received i.e. upto 1.7.2009 and vide letter dated 20.6.2009 Ex. C-14, the overseas buyer had sought the extension. In case the previous payment was Consumer Complaint No. 63 of 2012 19 not cleared then it was not sensible on the part of the complainant to send the second shipment on 3.7.2009 vide invoice Ex. C-9. The complainant replied to that question that he had dealings with this overseas buyer for the last 10 years and he was not a defaulter, therefore, they sent the second shipment but the belief cannot be over and above the terms and conditions, therefore, for sending the second shipment, the complainant did not take proper care and caution that when the first shipment has not been cleared then how he will receive the payment for the second shipment. While submitting credit application for renewal to extend the limit upto Rs. 20 lacs, the complainant failed to explain the overdue payment dated 20.10.2008. Its payment was due as on 18.1.2009 but total payment was realized upto 15.5.2009 but subsequent shipment was issued. It has been so observed by OP in their letter dated 25.4.2011 (Ex. C-
28) and the complainant in his reply vide letter dated 28.4.2011 (Ex. C-29) has been submitted that the payment was received as on 13.5.2009, which was late and still subsequent shipment dated 27.3.2009 was sent before clearance of the shipment dated 20.10.2008 and further declaration was delayed for 58 days and it was further submitted that he had been getting the payment late earlier also, even after due date, therefore, the subsequent shipment was sent. However, this fact was concealed by the complainant while submitting the credit information application for extension of the coverage and is also against the terms and conditions of the policy because second shipment was sent by the complainant before receiving the full payment of the first shipment.
Consumer Complaint No. 63 of 2012 20
15. Another plea taken by OP is that while applying for the policy, association/relationship of the buyer was not cleared. Even full name of the parties were not disclosed, which was observed from PAN Card that Surname 'Bhatti' is shared by the partners of the firm and owner of the buyer's firm. First credit limit application is Ex. C-1 and in the column, whether the buyer is associated/ related to you, it has been mentioned 'Yes', therefore, it cannot be said that the complainant had not declared whether the buyer is associated/related with him. No doubt that surname has not been mentioned by the complainant while moving this application whereas buyer's surname is 'Bhatti' because upto 2008 the overseas buyer was working under the name and style of M/s Bhatti Enterprises. No doubt that Surname would have been declared but this fact itself does not violate any terms and conditions of the policy.
16. Summing-up, we are of the opinion that the complainant has violated the terms and conditions of the policy in filing the declaration as the declarations were filed late. The complainant had not taken proper care and precaution while sending the shipment to the overseas buyer. The payment for the shipment dated 20.10.2008 was received in May, 2009 whereas another shipment was sent on 27.3.2009, vide letter dated 20.6.2009 extension was sought to make the payment by overseas buyer but again on 6.7.2009 another shipment was sent. Then while giving the extension to the overseas buyer, no intimation was given to the OP. The claim was not lodged with DCA M/s MAH International GMBH, Swizerland. No doubt, application was sent to High Commission of India, Canada but its Consumer Complaint No. 63 of 2012 21 reply has not been placed on the record, therefore, proper efforts for the recovery of the shipment was not initiated by the complainant, perhaps the overseas buyer is related to the complainant, therefore, the claim was rightly repudiated by OP.
17. Similar view was taken by the Principal Bench in Consumer Complaint No. 14 of 2012 "M/s Nancy Overseas versus Export Credit Guarantee Corporation of India Ltd. & Anr." Decided on 16.9.2013 that in case there is violation of terms and conditions of the policy then repudiation is justified.
18. In view of the above, we do not see any merit in the complaint and the same is dismissed with no order as to costs.
19. The arguments in this consumer complaint were heard on 4.8.2015 and the orders were reserved. Now the orders be communicated to the parties as per rules.
20. The consumer complaint could not be decided within the statutory period due to heavy pendency of Court cases.
(Gurcharan Singh Saran) Presiding Judicial Member (Jasbir Singh Gill) Member August 14, 2015. (Surinder Pal Kaur) as Member