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Judgment
A. P. Sahi, President
The complaint arises out of an insurance claim relating to the damage stated to have caused to the goods that was sustained due to a fall during transit. The claim has been repudiated by the insurance company. Hence this complaint.
Certain machinery was imported by the complainant for the purpose of manufacturing plastic bottle caps that were transhipped from Imola, Italy to Chennai. It was to be transported from Chennai to Bengaluru to the complainant’s factory situated at Kasba Hobli, Nelamangala, Bengaluru by road. For the purpose of the aforesaid transportation from Chennai to the factory premises, a Marine Cargo Insurance Policy from the Oriental Insurance Company was taken and the cover note prescribed the risk details where the machine/cargo was to be transported from Chennai to its destination at Bengaluru by road in two conveyances (Lorries). The policy is described as Marine Cargo- Single Voyage (Inland Transit) Policy dated 29.04.2015.
There were nine boxes containing different components of the machinery and box No.A-1 contained the Compression Moulding Press Machine.
The narration of facts by the complainant are that the transhipment reached the destination but while being unloaded at the gates of the factory on the road to be taken inside the factory, a forklift had been utilised together with two hydra cranes for pulling out the said boxes that were heavy and box no. A-1 was deep inside the container. To enable the forklift to apply the fork arm, a chain was tied to the base of the said box and a belt was put across it to pull it out. This was done in order to lift the box so that the fork arm of the lift reached underneath it.
The chain of the belt was hooked to the crane and the forklift was applied for pulling out the box. At the stage when the box was almost out of the container, the crane moved to clear the box horizontally out of the container. During this process, the bottom slippers of the box banged with the container and broke. The bottom plank of the box also snapped resulting in the fall of the machine on the ground.
This incident of 04.05.2015 occurred in the morning at 6.00 am and the same was reported to the Senior Divisional Manager of the Insurance Company.
The Insurance Company appointed Mr. K. Kanchappa as the spot Surveyor, who inspected the spot and submitted a preliminary survey report on 19.06.2015. The said survey report is extracted hereinunder: -
“Date: 19.06.2015
PRELIMINARY SURVEY REPORT
In accordance with the instructions received from M/s. The Oriental Insurance Co Ltd., the survey was conducted at M/s. Shakambari Polymers Pvt. Ltd., Sy No.22/12, Vishweshwarapura Village, Kasaba Hobli, Nelamangala Taluk, Bengaluru to assess the extent of loss suffered by the insured and the details are furnished below:
INSURER : M/s. The Oriental Insurance Co. Ltd., Divisional Office No.1 Tiwari Enclave, Lalpur Chowk, Ranchi, Jharkhand-834001.
INSURED : M/s. Shakambari Polymers Pvt. Ltd... Bengaluru Rural Sy.No.22/12, Vishweshwarapura Village, Kasaba Hobil, Nelamangala Taluk, District, Karnataka-562 123.
POLICY PARTICULARS : Policy No.332200/21/2016/3.
CONSIGNOR : M/s. Sacmi Hong Kong Ltd., Rm. A-B, 16th Floor, Neich Tower, 128, Gloucester Road, Wanchai, Hong Kong.
Consignment Landed at: M/s. Beekeyen Freight Services (P) Ltd., New No.24, Old No. 102, Moore Street, Chennai-600 001.
CONSIGNEE : M/s. Shakambari Polymers Pvt. Ltd. Sy.No.22/12, Vishweshwarapura Village, Kasaba Hobli, Nelamangala Taluk, Bengaluru Rural District. Karnataka-562 123.
CONSIGNMENT : Said to contain one consignment of one complete Manufacturing line for 1 Piece plastic closures covered by Invoice No.2015101 DT.18.03.2015 and valued at EUR 6,36,272-00.
DESPATCH PARTICULARS : From Hong Kong to Chennai by sea vide bill of lading No.7002028714 DT 22.03.2015 and then to Bangalore by Road Vide LR No.603916 DT.02.05.2015 of M/s. Geekeyes
Logistics Pvt. Ltd.
DATE OF ARRIVAL OF : Reported to have been received on 04.05.2015.
CONSIGNMENT
NATURE OF PACKING : The Machinery parts were wrapped by poly sheet and packed in wooden boxes and placed inside containers.
CONDITION OF PACKING : Reported to have been received in damaged
ON ARRIVAL condition.
DATE OF ALLOTMENT OF : On 5h May 2015.
SURVEY
DATE/PLACE OF SURVEY : On 5th May 2015 at and subsequent days at M/s. Shakambari Polymers Pvt. Ltd., Sy.No.22/12, Vishweshwarapura Village, Kasaba Hobli, Nelamangala Taluk, Bengaluru Rural District,Karnataka- 562 123.
DETAILS OF SURVEY
M/s. Sacmi Hong Kong Ltd., Hong Kong had dispatched one consignment of one complete manufacturing line for 1 Piece plastic closures covered by the Invoice No.2015101 DT.18.03.2015 and valued at EUR 6,36,272-00. The Machinery parts were wrapped by poly sheet and packed in wooden boxes and placed inside containers and was dispatched from Hong Kong to Chennai by sea vide bill of lading No.7002028714 DT.22.03.2015 and then to Bangalore by Road Vide LR No.603916 DT.02.05.2015 of M/s. Geekeyes Logistics Pvt. Ltd., The consignment was reportedly received in damaged condition on 04.05.2015 and hence the insured sought the services of supplier M/s. Sacmi Imola S.C., for rectification of damages and communicated to the insurer requesting for deputation of surveyor to assess the loss.
On instruction from insurer, the insured M/s. Shakambari Polymers Pvt. Ltd., Situated at Sy.No.22/12, Vishweshwarapura Village, Kasaba Hobli, Nelamangala Taluk, Bengaluru Rural District, Karnataka was visited and detailed examination of the consignment was carried out. The one complete manufacturing line for 1 Piece plastic closures, mainly composed of No.1 CCM48S Compression Moulding Press and No.1 SFM12L Band folding and scoring machine have been inspected and it was observed that the CCM48S damages outside protections, outlet conveyor, all the upper and lower frame and distributor, the lower base, the main support of the forming turret, the machine suffered a strong lateral impact. The photographs of the damaged items have been obtained during survey are enclosed with the report. They were advised to get the damaged parts of Machine repaired. Accordingly the course of our inspection it was preliminary estimation will be around Rs.1,44,09,450/- (EUR 2,13,000/-).
This preliminary report is issued without any prejudice and is based on personal investigations carried out by me.
(K.KENCHAPPA)”
The complainant submitted his claim form on 25.06.2015 and a reply of the same date to the preliminary surveyor in response to the letter dated 09.05.2015 whereafter the Insurance Company appointed M/s J.B. Boda & Co. as final surveyors who visited the site on 08.07.2015 and again on 23.07.2015. They submitted an interim survey report on 17/26.08.2015. The said report was inconclusive as to whether the damage took place while unloading or inside the container prior to unloading. This was opined due to the contradictions in the statements of the driver of the lorry and that of the crane operator. On exchange of information, a joint meeting was held in the presence of the proprietor of M/s K.P. Cranes from whom the two hydraulic cranes and one forklift had been hired by the complainant for unloading purpose. The minutes of the said meeting dated 16.11.2015 are extracted hereinunder: -
“Minutes of the meeting hed at the office of K.P. Cranes, Nelamangala, Bangalore on 16.11.2015.
The following were present:
Mr. H.K. Prabhakar, (Prop) K.P. Cranes.
Mr. Shailesh Saraf, Director, Shakambari Polymers Pvt. Ltd., Bangalore
Mr. Dexlev Fernandis & Mr. G.R. Krishna of J.B. Bode Insurance Surveyors & Loss Assessors P. Ltd., Bangalore
Mr. Anujay Senha, Manager, Shakamberi Polymers,
Re: Reported damage to Compression Moulding Machine CCM 485 while unloading from Marine freight container No. INKU 231428-1 on 04.05.2015.
Mr. H.K. Prabhakar, Prop of K.P. Cranes was had carved out the unloading operation of the entire consignment on 04.05.2015 has stated as under:
Quote:
As per my workers who had carried out the validity operations of the cases from the container's using mobile cranes and fork lift had…..(illegible) on 04.05.2015. That one case was damaged prior to unloading. But at the same time I cannot confirm the facts as I was not present physically at the spot and the concerned workers had quit the job.
Unquote
Mr. Shailesh Director of Shakambari Polymers and Mr. Anujay, Manager of Shakambari Polymers who were physically present at the spot at the time of unloading on 04.05.2015 do not agree to Mr. Prabhaker's statement and states as under:
Quote
As per Mr. Shailesh and Mr. Anujay the 1st two cases were unloaded successfully with the cranes & test lift of KP Cranes. While unloading the 3rd case with CCM inside the case before it two parts and the machine fell to the ground. Later the danger machine and the case was project inside the factory premises.
All the other cases were unloaded successfully and throughout into the factory.
Unquote
For K.P. Cranes Shakamberi Polymers Pvt. Ltd.
Sd/- Sd/-
Proprietor Director”
The said report has been duly signed by the officials of the complainant, the proprietor of M/s K.P. Cranes and the Surveyors of J.B. Boda & Company. This is a crucial document as it also records the statement of Mr. Prabhakar regarding the incident. The Insurance Company thereafter appointed another Investigator, namely, Mr. Shashidhar to carry out an investigation.
The complainant also lodged his final claim on 08.12.2015. The Investigator Mr. Shashidhar arrived at the factory on 02.02.2016 and he submitted his report on 17.06.2016. The report of Mr. Shashidhar indicates an inference that the damage took place at the premises of the insured company and, therefore, the claimant had failed to prove that the damage was caused during its transit or while unloading the machinery. The observations made by Mr. Shashidhar in the aforesaid report are extracted hereinunder: -
“On 12/08/2015 we visited Chennai and contacted M/s. Geekeys Logistics Pvt. Ltd., and we were asked to come to their Corporate office located at 53,55 3rd Floor, Rowther Chambers, Rajaji Salai, Chennai-600 001. On our arrival there we observed that their corporate office was in the name of M/s. Team Trans Logistics Pvt. Ltd., which was the parent company. We then met the officials of Team Trans Logistics Pvt. Ltd. and made enquiries. After prolonged discussions they contacted the driver of the vehicle who had transported the container to Chennai. We spoke to the driver Mr. Palaniswamy from their office and made enquiries with him. He told us that while unloading the cases one case had slipped and fallen to the ground. Due to this the case was damaged and had opened out. After this the owner had arrived at the spot and had a big quarrel with the crane operators and their people. He also informed us that two mobile Hydra cranes and a small forklift was used for the unloading operation. After things cooled down the balance cases were unloaded. The driver Mr. Palaniswamy then approached the owner of the consignment and asked him to acknowledge receipt of the goods on the reverse of the LR. The owner informed him that he would make a remark stating that one case was damaged. The driver Mr. Palaniswamy disagreed and argued with him stating that he had brought the container without a scratch and the cases were sound before unloading and hence there was no question of making any remark on reverse of the LR. The driver Mr. Palaniswamy then obtained the acknowledgement from the owner of the consignment stating received material. He then returned back to Chennai.
We then visited the office of M/s. Beekeyen Freight Services Pvt. Ltd., located at 24, Moore Street, Chennai - 600 001 and met the Director Mr. V. Neelakantan who had informed us that they had cleared the consignment from Chennai Customs and thereafter loaded the same onto two trailers and dispatched it to Bangalore. He had also shown us the acknowledgement signed by the owner of the consignment wherein no remark of any damages were mentioned.”
The Final Survey Report was submitted by Mr. J.B. Boda & Company on 06.10.2016 and the observations are that the complainant failed to prove that the damage had occurred during transit or while unloading the machinery and, therefore, it could not be proved as to exactly where the loss had taken place. The observations are extracted hereinunder:-
“Quote:
Based on the above information ascertained from the available concerned persons, it can be inferred that the above damage has taken place within the premises of the Insured Company and claimant has failed to prove that the damage has occurred during its transit or while unloading the Machinery.
Points for observations:-
Mr. Shylesh the Director of M/s. Shakambari Polymers Pvt., Ltd, has not produced any documentary evidence to prove that the damages occurred outside the factory premises.
At the time of accident Mr. Shylesh, Mr. Anujay-Manager of Shakambari Polymers, Drivers of Transporters and Crane and also security personnel of Shakambari Polymers were present and none have taken the Photographs of the accident to prove their claim.
Mr. Shylesh has settled the Transporter's Bill and K P Cranes payment without any comments or deducting for the damages.
There was no Police complaint in this regard.
Mr. Shylesh has not made available any of the concerned persons for obtaining his statement about the accident.
When the First Surveyor of the Insurance Company namely Mr. Kenchappa visited, the damaged parts were found inside the premises of the Company.
In the minutes of the meeting held at the office of K P Cranes, Nelamangala, Bengalure on 16/11/2015 Mr. H K Prabhakar Proprietor of K P Cranes has quoted " As per my workers who had carried out the unload operation of the cases from the containers using mobile cranes and fork lift had confirmed on 04/05/2015 that one case was damaged prior to unloading, but at the same time I cannot confirm the facts as I was not present physically at the spot and the concerned workers have quit the job. This is for your information.
Unquote:
Under these circumstances it is not conclusively proved as to where the loss had taken place. The insurer may note this whilst settling the claim.”
The Insurance Company after having considered the aforesaid reports finally repudiated the claim on 14.08.2017 through the following communication: -
“With reference to the above. we regret to say that the claim has not been found admissible under the terms and conditions of Marine Cargo Single Voyage Inland Transit Policy.
The Surveyor and the Investigator both are unanimous in their finding that the claim is not admissible in terms of the provisions of the Inland Transit Policy. Agreeing with their submission, finding and recommendation we regret to admit any liability in the claim.”
The aforesaid communication was reiterated on 30.10.2017 on representations.
In this consumer complaint, the Insurance Regulatory & Development Authority of India, Hyderabad has also been arrayed as opposite party No.4 and a written version has been received on their behalf as well. However, the said reply simply states that no services were hired from the Regulatory Authority and, therefore, the complaint deserves to be rejected insofar as no relief has been claimed against the said opposite party.
In the background aforesaid, the report of the spot survey, which is in the shape of a preliminary survey report dated 19.06.2015 by Mr. K. Kenchappa, it is evident that the box containing Compression Moulding Press had suffered a strong lateral impact and photographs of the damaged items have been taken. There is also no dispute about the fact that the unloading was done at the gate of the factory as is admitted in the complaint itself and for the purpose of transportation, M/s Geekey Logistics Private Limited had been hired for carrying the container from Sattva CFS to Neelamangala factory. However, at the time of unloading, the complainants made immediate arrangements for unloading / de-stuffing of the packages for which two hydra cranes and a forklift were hired by them from M/s K. P. Cranes, Neelamangala. It is these hired cranes and the forklift of M/s K. P. Cranes that were utilised for unloading the boxes. While unloading box no. A-1 certain devices were deployed by these cranes and forklift operators who were the workers of M/s K. P. Cranes and while unloading the box, it fell down.
It is not the case even of the complainant that the machinery had been damaged while on transit by road by the transporters from Chennai on it’s way. According to the evidence on record, in all probability the said box fell down at the time of unloading by the handlers. The driver, Palanisamy, has confirmed this to the investigator Mr. Shashidhar who in his report dated 17.06.2016 has categorically mentioned it. There is no evidence of the goods being damaged on its passage forward from Chennai.
The destination of the inland transit policy for the carriage of the said goods is from Chennai port to the factory. The containers were shifted at the port by the shipping company which according to the report of the custom officials also had arrived at Chennai port in sound and intact condition.
The unloading process is said to have taken place just outside the factory campus at the gate on the road side. The information given was that the consignment had been finally received in damaged condition. The evidence, which was taken, indicates that Mr. Prabhakar, proprietor of M/s K. P. Cranes, stated that the case was damaged prior to the unloading as informed to him by his workers but at the same time he could not confirm the same as he was not present at the spot. This statement indicates as if the goods had been received in a damaged condition before it was unloaded but he could not confirm the same as he was not present on the spot. The statement of Mr. Prabhakar was fully contested by the managers of the complainant company stating that the damage was caused after the consignment fell at the time of unloading. This doubt which was expressed as to the place of unloading, and also the falling of the box and causing damage, was further investigated by the surveyor Mr. J. B. Boda Insurance Surveyor and Loss Assessor Pvt. Ltd. in the final survey report dated 06.10.2016. The fact of unloading the consignment is indicated as having taken place at the gate of the factory besides the road for which a forklift and 2 hydra mobile cranes had been hired by the complainants. It is thereafter the goods were taken inside the factory premises and the matter was reported to the insurance company. The survey report observes the damage caused to the crate carrying the said consignment and the machine that was inside the said crate was found to be severely distorted, dented, sprung out and bent. A joint inspection of the machine was carried out alongwith manufacturer’s engineer at a subsequent date, who informed that they do not have the facilities in India to carry out such major repairs and therefore, the machine will have to be sent back to the manufacturer’s work for repairs to Italy. As it was found that the repair cost was more than the cost of a new machine, a replacement was suggested.
Coming to the operation of unloading, the surveyor’s report indicates that the hiring of a forklift and wayside cranes may have been risky. On further investigation, it was found that the hydro cranes and forklift had been hired from M/s K. P. Cranes and they met Mr. Prabhkar, who revealed that his equipments had unloaded the consignment but he denied the falling of the crate of the damaged goods, and he informed that it appears to have been the damaged while being transported lying inside the container. It was also recorded that Mr. Prabhakar informed that the team which had carried out the unloading was not available and no further information was given.
The Surveyor visited Chennai on 12.08.2015 and they were able to contact the transporter and in the exercise they were able to telephonically contact Mr. Palaniswamy, the driver, who had driven the vehicle along with container from Chennai port to the factory. According to the surveyor, the driver informed them that one of the cases had slipped and fallen to the ground while being unloaded as a result whereof the said crate had been damaged and a big quarrel had taken place with the crane operators and the staff of the owner. The consignment was signed by the owner and acknowledgment obtained thereof. The driver also informed that he then returned back to Chennai. This acknowledgment did not bear any remark of damages. A joint meeting had taken place, as noted above, with Mr. Prabhakar, the proprietor of M/s K. P. Cranes and finally the inference drawn was that there was no proof that the damage had occurred either during transit or while unloading the machinery. Thus, there was no conclusive evidence as to where and how the loss had taken place. In view of this inconclusive report, the insurance company invoked the services of an investigator Mr. K. R. Shashidhar, whose report has been extracted herein above.
In the background above, Mr. K.R. Shashidhar drew his inferences whereafter final survey report was submitted on 06.10.2016 by Mr. J. B. Boda Insurance Surveyors and Loss Assessors Pvt. Ltd. observing that there was no documentary evidence to prove that the damage had occurred outside the factory premises and that the complainant had nowhere taken photographs of the incident to prove this claim. Coupled with this, there were no comments by the complainant on the bills that were paid to M/s K. P. Cranes reflecting any damage having been caused or the falling of the crate while unloading.
The question now is as to whether the surveyor’s report indicates selective facts, which have been edited to deny the claim and which is the moot question to be answered.
The information which has been furnished has to be understood in the light of the fact whether the goods were insured and whether the policy led to an insurable claim on account of the incident which has occurred.
It is apparent from the surveyor’s report itself that they had been able to contact the driver of the carrier, Mr. Palaniswamy, who admitted having transported the goods on two trailers. The question of it being unloading outside the factory premises has been doubted in the final survey report dated 06.10.2016 on the ground that no documentary evidence was produced to prove that the damage had occurred outside the factory premises.
From a perusal of all these documents and the statements as well as the pleadings between the parties, the place of unloading appears to be just outside the gate of the factory premises. There is no evidence to indicate that the containers were carried inside the factory premises. The carrier loaded with the cargo in two containers was therefore, sought to be unloaded at the gates of the factory where two hydra mobile cranes and one forklift had admittedly been hired by the complainants for unloading the goods. Thus the cranes and the forklift therefore were operational when the box containing the machinery that is reported to have been damaged was being unloaded. There is no evidence to prove that goods were damaged while being transported from Chennai to the gates of the factory. The statement of Mr. Prabhakar, the proprietor of the company from whom the cranes and forklift had been hired made a very dubious statement that his workers who had unloaded the consignment, had informed that the goods were damaged before unloading but during survey and investigation he said that these workers were not available for confirmation, and he himself was unable to confirm the same as he was not present on the spot. It is thus obvious that such a statement cannot be relied on. The surveyor and investigator also could not derive any firm conclusion on the same.
In the absence of such evidence to demonstrate that the goods had been damaged while being transported from Chennai to factory, the place of damage during transit before its arrival at the factory gates does not appear to be established.
The conspectus of the facts and the statement as recorded indicate the preponderant probability of the fall of the case while being unloaded at the factory premises appears to be possible. Mr. Prabhakar, the owner of cranes and forklift made a statement on the basis of his alleged information from the workers that the goods were damaged from before. There is no evidence to substantiate the aforesaid statement nor any such worker was examined or any material adduced to demonstrate that the goods had been damaged prior to unloading. To the contrary, the custom clearance houses had reported the goods to be intact and which also appears to be the status when the goods arrived at the factory gate. The fact of lifting of box A-1 and fall having taken place does not appear to have been rebutted successfully either by Mr. Prabhakar or any other witness. On the other hand, the statement of Mr. Palaniswamy, the driver, who reportedly informed the surveyor about that fall having taken place while unloading and followed by a quarrel with the owner appears to be in tune with the fact that the owner / complainant had witnessed the consignment having fallen down during this unloading. Thus, there is every reason to believe the said version of the box having fallen while being unloaded at the gates of the factory.
On the said basis what follows is that the spot surveyor who arrived at the next day after the goods were placed inside the factory premises noticed the extent of damage which is further fortified by the conclusions drawn in the final surveyor’s report.
The expenses having been met to carry out the repairs of the machine is not profiteering but is a claim based on the loss suffered which is for indemnification. This consequent action of the machine getting repaired and the expenses borne in respect thereafter have been indicated in the surveyor’s report and the factum and loss and damage suffered has therefore been certified.
However, while repudiating the claim the insurance company has relied on the surveyor’s report casting a doubt on the place and the manner of damage. In the considered opinion of this Commission, casting of a doubt is not sufficient to deny liability in as much as the fact of the occurrence of the incident at the gates of the factory while unloading the goods causing damage has not been negatived and is rather established on the facts as discussed hereinabove. The statement of the owner of the crane does not inspire confidence in the least as he may have done it in order to avoid liability on his part or his workers, who were involved in the unloading of the goods.
The next question is as to whether such a risk was covered under the policy or not. A copy of the policy has been filed along with the written statement where it is admitted that the risk of the voyage was covered under the said policy from Chennai to Bangalore by road in two conveyances. The policy has been explained and the following statement has been made in the written statement in paragraph 1.
1]. The Complainant obtained Marine Cargo – Single Voyage, (Inland transit) Policy, being Policy No. 332200/21/2016/3, issued by Oriental Insurance Co. Ltd. (Insurer / Opp. Party) for covering risk of voyage from Chennai to Bangalore in two conveyances.
The aforesaid policy was subject to Inland Transit (Rail/Road), Clause-A and SRCC (inland Transit) Clause.
The Policy covered risk from the time goods leave the warehouse and/or the store from the place named in the policy for the commencement of transit and continues during the ordinary course of transit including customary transshipment, if any, until delivery to the final warehouse at the destination named in the policy.
In the event of any mishap, immediate intimation to the insurer was necessary. The Policy exclusion clause (2.1) clearly stipulates that “the Company shall not be liable for loss, damage or expense attributable to willful misconduct.”
The exclusion Clause 2.3 excludes coverage “for loss due to loss, damage or expense caused by insufficiency or unsuitability of packing.”
Thus it is apparent that if the weight of the cargo exceeds the capacity of Crane engaged to lift the Cargo then any loss or damge due to lesser capacity of Crane will be willful misconduct on part of Insured.
The written statement further states in paragraph 2 that the intimation which was given about the damage does not say anything about the reason for such cause of damage. However while intimating the bank, it was stated that the damage was caused while unloading and destuffing from the Container. The said information dated 06.05.2015 records as follows:
With a feeling of despondency we would like to inform that the main core CCM48 (Compression Moulding Press) of our imported SACMI’s compression line got damaged while unloading and de-stuffing from the container.
…..
While de-stuffing and subsequently unloading the 3rd box (i.e. A1) containing the CCM48, accidently it fell on the road from the container and got severely damaged.
The bill for shipment through the transporter mentions the transport charges from the port to shipper warehouse. Thus, it is the case of the complainant that the damage was caused while unloading and destuffing of the container, which was accidental when the machine fell at the gates of the factory on the road from the container causing severe damage to the consignment.
As noted above, the goods in all probability were damaged on account of the fall of the crate while unloading at the gates of the factory. The question is whether the said place can be said to be a place covered under the policy during transit. It is not the case of the Insurance Company that the unloading of the goods during transit is not within the policy. The purpose of such a transit policy is to cover the carriage of the goods to its final destination. It is equally true that the assured/insured has to act with reasonable dispatch in all circumstances within their control. The ordinary course of transit has been explained by the Apex Court in the case of “Bajaj Allianz General Insurance Company Limited And Anr. Vs. State of Madhya Pradesh, (2020) 18 SCC 376” in paragraph 35 is as follows:
“35. The purpose of the marine transit insurance policy is to cover the consignment from risks associated with transportation of the consignment from one place to another. It is fundamental for those responsible for carrying the cargo to ensure that all stages of the transportation are effected with reasonable promptness. “In transit”, however, does not necessarily mean that the consignment needs to be in continuous motion at all times. A mere brief suspension must however be in furtherance of the ordinary course of transit. During the ordinary course of transit, the consignment might frequently come to rest or be temporarily stored in the dock awaiting loading or customs clearance. However, unduly protracted steps in the cargo's transportation are not within, and may terminate, the “ordinary course of transit”…………………………….”
The purpose of a transit policy is to cover the carriage of goods to its final destination. In the instant case as would be evident from the observations made hereinabove and hereinunder is the element of unloading the cargo for being shipped inside the factory is an ancillary performance during transit which happened at the gates of the factory. The surveyor came to the conclusion that it would not be possible to ascertain as to whether the loss occurred during transit or at the time of unloading. As observed herein, the occurrence of the damage on account of the fall has been witnessed by appropriate evidence at the gates of the factory. Consignment was under transit at the time of its unloading and appropriate steps and machinery was deployed for unloading the consignment. In the said circumstances the goods were being unloaded during the ordinary course of transit before being finally lodged inside the factory premises, which was the warehouse of final destination. The unloading operation was therefore associated with the transportation to the destination covered under the policy. The snapping of the crate plank while it was being hauled by the crane was something beyond the control of the assured/ complainant. Full preparation and precaution was undertaken for due despatch of the consignment under reasonable care for unloading. There was therefore no deviation from the terms of the policy and the conveyance of the commodity to its place of storage was underway when the accident happened.
The question is as to whether this accidental damage as stated by the complainant is covered under the policy or not.
The contention of the insurance company is that there was negligence in unloading the cargo, which is attributable to the complainant as they had not engaged a crane with sufficient capacity and had not taken proper precaution for unloading such a heavy article. The surveyor has commented on this stating that they had engaged the services of some wayside cranes and forklift owner, which is to indicate that they were of some sort of medium range service providers for which they do not have any record or bills. The surveyor expressed that it is unconceivable to believe that the articles could have been unloaded using wayside cranes and forklift. To examine this fact, it has been stated by the surveyor what needs to be noted is that the cash / credit bill of Rs. 15,000/- dated 05.05.2015 for crane hiring charges for unloading of machine was paid for which a bill has been appended along with the complaint duly signed by the owner of M/s K.P. Cranes. The conclusion drawn by the surveyor that it was a wayside crane and forklift, does not in any way inspire confidence and to the contrary, there is documentary evidence to demonstrate that the wayside crane and forklift for Rs. 15,000/- was hired. The findings of the surveyor that it is not possible to believe that such cranes or forklift could have unloaded the consignment is also a conjectural assessment not based on preponderance of a probability. What has been noted and is evident from the pleadings as well as evidence that the same cranes and forklift had helped in unloading of 8 other boxes safely out of the 09 boxes in all in the two containers that were lifted and unloaded without causing any damage. The destuffing and unloading of all 09 boxes with the help of these cranes and forklift was, therefore, carried out with the same equipments and workers with their experience. To treat them as a wayside agency casually without any material to support such observations by the surveyor appears to be whimsical.
Consequently, if the same cranes and the forklift had succeeded in unloading and de-stuffing the containers, it is not understood as to by what measure and calibration the surveyor found the cranes or the forklift not having the capacity to unload box number A-1, which was a little heavier than the other boxes. The cranes and forklift were deployed by belting and chaining the boxes and while the crane was pulling the boxes outside the container, it hit the side of the container resulting in the breakage of the bottom plank and the bottom frame, which caused accidental fall. This in no way can be presumed to be an incapacity or deficient capacity of the crane that was deployed to lift the same. The crane had lifted it but it was on account of the breaking of the bottom plank of the box that the goods fell down. This was an unforeseen circumstance as all precautions for a safe unloading were diligently taken. The snapping of the wooden material of the crate, therefore, is not an incapacity of the crane so as to deduce that it was a wayside crane of some insufficient capacity that could not have lifted the boxes. As noticed above, the boxes had been lifted and the other boxes had also been hauled out by the same devices.
There is one more fact which needs to be considered that the forklift had to be pushed inside and for that the crane had to be utilized to lift the box so as to secure the insertion of the forklift lever beneath the box. It is during this exercise that the wooden case snapped and it fell. This in the opinion of the Commission is only an accidental occurrence and the surveyor does not seem to have commented upon the inadequate packing of the material in the crate boxes so as to find any deficiency in the packing of the goods that were placed inside the crate. The written submissions also and the repudiation letter nowhere comment upon the extent of packing of the material to be deficient. It was on account of the crate having hit against the wall of the container that might have caused the wooden planks to have snapped and therefore, the surveyor’s report is completely wanting and silent on this issue. The surveyor seems to have exhausted his entire energy in creating a doubt instead of finding out a correct cause as has been noticed above.
The final surveyor’s report, therefore, does not take into account vital aspects which clearly lead to the conclusion that it was the accident which occurred during unloading and destuffing that the damaged goods fell resulting in the loss as claimed.
As noticed above, the conclusion that the insufficiency or the capacity of the crane is not borne out from any material and the factum of the fall of the goods is clearly corroborated by the statement of the driver Mr. Palaniswamy which has been recorded in the report by the surveyor himself. The combining all these facts and keeping in view the accidental damage caused which is covered under the policy and the damage having been caused during destuffing and unloading at the gate of the factory besides the road is clearly covered under the risk and is not excluded. There was no willful misconduct or negligence established on the part of the complainant and hence the conclusions drawn by the surveyor are not creditworthy. The rejection of the claim was, therefore, unmindful of all the facts and factors and in the opinion of the Commission the claim deserves to be allowed.
Learned counsel for the insurance company has been unable to dislodge the same and an argument was advanced by the learned counsel citing the judgment of Apex court in the case of Khatema Fibres Ltd. Vs. New India Assurance Co. Ltd. and another 2021 SCC Online SC 818 that deficiency has not to be found out by carrying out any forensic examination by the surveyor’s report. The same judgment also opines that the surveyor’s report is not a last and final word. It is, therefore, evident that the surveyor’s discretion cannot be exercised arbitrarily or whimsically. However, in paragraph 38 of the said judgment it has been observed that in the absence of any quality, nature and manner of performance of the duties and responsibilities of the surveyor, as per the regulations, and if it is found that the report is not based on adhocism or vitiated by arbitrariness, then the consumer forum will have no jurisdiction to go further. Applying the principles laid down therein and as per the evidence on record, the conclusions drawn by the surveyor to just cast a doubt as indicted above, in the opinion of the Commission, amounts to an adhoc assessment and rather an arbitrary avoidance of taking into account the correct status of the evidence. Hence, the said final survey report in the present suffers from infirmities, which cannot be overlooked. The surveyor has qualitatively failed to carry out his responsibility as an assessor after all the evidence was available. The reliance on the surveyor’s report and consequential repudiation is therefore a clear deficiency in service.
Consequently, for all the reasons stated hereinabove, the repudiation of the claim by the insurance company dated 14.08.2017 is deficient and unjust and the claim deserves to be allowed on the basis of computation of loss which does not appear to be disputed even by the surveyor. The loss as computed by the surveyor in the final survey report dated 06.10.2016 has been detailed and the summary of assessment made is to the tune of Rs. 1,48,63,031/-. The details are provided for in the annexure appended to the said report as stated therein. The same is extracted hereinunder:
“We have without prejudice based on the claim bill and supporting documents submitted to us by the Insured, assessed the Insured’s loss without prejudice on a total loss basis as given in Annexure B of this report. The summary is as under;
Rs. p
Amount allowed for the new CCM485SB as given in
the Annexure B
1,38,30,000.00
Add Customs Duty
10,89,527.40
Add C & F, Loading, Transportation charges
32,671.00
Add Airport charges
52,664.00
Add Transit Insurance charges from Airport to Insured’s
factory
8,300.00
Gross Amount allowed for the new CCM485SB
including Customs duty as given in Annexure B
1,50,13,162.40
Less Policy excess (-)
1,50,131.62
Net Amount Allowed
1,48,63,030.78
Say Rs.
1,48,63,031/-
Accordingly, this claim is allowed for the sum of Rs. 1,48,63,031/- with effect from the date of the liability incurred under the policy together with interest at the rate of 9% thereon, to be calculated accordingly till the date of actual payment. The amount shall be disbursed within 03 months and in default, the interest shall be enhanced @12% per annum.
Disposed of with the said directions.