Case nº First Appeal No. 212 of 2008 of National Consumer Disputes Redressal Commission, April 03, 2014 (case Murli Cold Storage Limited Vs Oriental Insurance Co. Ltd.)

JudgeFor Appellant: Sukumar Pattjoshi, Sr. Adv. and Sanjoy Kumar Ghosh, Advocate and For Respondents: Mohan Babu Agarwal, Advocate
PresidentD.K. Jain, J. (President), Vineeta Rai and Vinay Kumar, Members
Resolution DateApril 03, 2014
Issuing OrganizationNational Consumer Disputes Redressal Commission


D.K. Jain, J. (President)

  1. This First Appeal under Section 19 of the Consumer Protection Act, 1986 (for short "the Act") has been filed by the Complainant, questioning the correctness of order dated 24.12.2007 passed by the State Consumer Disputes Redressal Commission, West Bengal (for short "the State Commission") in S.C. Case No. 27/0/2004. By the impugned order the State Commission has dismissed the complaint, inter alia, holding that the Respondent - Oriental Insurance Company Ltd. (for short "the Insurance Company") had not committed any deficiency in service in repudiating the insurance claim preferred by the Complainant. The Complainant, a body corporate, is the owner of a cold storage, which was used for storing potatoes for" preservation. In order to secure loss on account of any kind of deterioration of stocks of potatoes stored in the cold storage, the Complainant was taking 'Deterioration of Stock Policy' (DOS) right from the year 1993-1994. The full storage capacity of the cold store, consisting of four Chambers, was 2.42 lac quintals. The Policy was issued by the Insurance Company to indemnify the Complainant against the losses due to any accident resulting in deterioration of the stocks of potatoes to the extent of Rs. 5,80,80,000. The policy was valid during the relevant period i.e. 9.4.1999 to 8.4.2000.

  2. On 3.7.1999, there was a leakage of Ammonia gas in the cold storage, resulting in heavy damage to the potatoes stored in Chamber Nos. 3 and 4. The accident was duly reported to the Insurance Company, which appointed a Surveyor-M/s. J.B. Boda Surveyors Pvt. Ltd. The Surveyor assessed the loss on account of damage to the potatoes stored in Chambers No. 3 and 4 respectively at Rs. 68,69,974 and Rs. 26,00,000 in October 2000. The Insurance Company settled the claim of the Complainant in respect of Chamber No. 3 and paid a sum of Rs. 68,69,974, the loss assessed by the Surveyor. However, vide letter dated 17.10.2000, the Complainant's claim in respect of Chamber No. 4 was repudiated on the sole ground that the Complainant had constructed an intermediate window (Architrave) in the common wall of Chambers No. 3 and 4, which amounted to deviation from the original lay-out plan. For the sake of ready reference, the letter repudiating the claim is extracted below:

    In regard to the captioned claim, it is observed from the Survey Report that an intermediate partition wall opening had been constructed by you between Chambers-3 and 4. The ammonia leakage which originally occurred at Chamber-3 had subsequently spread to Chamber-4 when the above mentioned partition window was opened by your Cold Storage personnel. The construction of the intermediate window constituted a deviation from the original Layout Plan, where the intervening window has not been shown and the partition wall is described as a 'common wall with insulation.' We had made a reference to the concerned authorities (Directorate of Agricultural Marketing) for their confirmation as to whether this deviation is permissible. In reply, they have issued their letter dated 30.8.2000 addressed to you with copy endorsed to us wherein they have stated that the partition window has been constructed without their approval or permission and is a deviation from the original plan. They have also stated that the construction is in contravention of the provisions of West Bengal Cold Storage Act and Rules.

    Under the above circumstances, we are unable to consider your claim pertaining to Chamber-4 since this has occurred solely on account of the opening the above mentioned partition window. The Competent Authority has accordingly approved settlement of your claim for Rs. 68,69,974 which pertains to the loss in Chamber-3 only. We enclose our Loss Voucher for the above mentioned amount and would request you to return the same to us duly discharged in duplicate to enable us to release the claim cheque in your favour.

  3. It appears that even thereafter some correspondence was exchanged between the Complainant, the Directorate of Agriculture Marketing and the Insurance Company. However, it seems that the said Correspondence did not evoke any positive response. Consequently, the Complainant filed the Complaint in the State Commission, praying for direction to the Insurance Company to settle their claim in respect of Chamber No. 4 and disburse a sum of Rs. 26,00,000, the loss assessed by their own Surveyor, along with interest @ 18% p.a., with adequate compensation for delay in release of the said amount.

  4. The complaint was contested by the Insurance Company. Besides raising two preliminary objections to the maintainability of the Complaint, viz. (i) the Insurance Policy having been taken for a commercial purpose, namely, storing potatoes, etc., the Complainant did not fall within the preview of definition of the term "Consumer" under Section 2(1)(d) of the Act and (ii) the Complaint was barred by limitation as it was not filed within a period of two years of the date of repudiation of claim i.e. 17.10.2000. The allegation of deficiency in service on the part of the Insurance Company was refuted mainly on the ground that the Architrave in the partition wall between Chambers No. 3 and 4 was never brought to notice of the Licensing Authority, which had verified and approved the lay out plan, under the West Bengal Cold Storage (Licensing and Regulation) Act, 1966 (for short "the WB Act") and the same was discovered during the course of survey by the Surveyor. It was pleaded that had such...

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