In the present appeal, the appellant Vijay Cotton and Fiber Company has challenged the order dated 17th February 2016 passed by the Maharashtra State Consumer Disputes Redressal Commission Mumbai (in short “the State Commission”) in consumer complaint No.CC/12/87 whereby the complaint filed by the appellant has been dismissed.

2. Brief facts of the case are that the complainant is an export company which exports raw cotton to other countries. With the intention to provide safety cover to their goods either in transit or at ports, the complainant company availed the insurance service of the opposite party. The policy was enforced with effect from 24th February 2009 to midnight of 23rd February 2010. The complainant received an order from a German firm for export of 250 MT of raw cotton equivalent to 1500 pressed cotton bales. The exported goods were to be sent to Qingdao China first. Accordingly the complainant placed orders for supply to other companies Bansi cotton private limited and Raghuvir cotton ginning and pressing private limited. These companies started dispatching the raw cotton bales to the CFS at Mundra Port in the month of October 2009. It is the case of the complainant that by 22nd October 2009, 900 cotton bales had reached the CFS at Mundra. 750 bales were stuffed in the container and 150 bales remained at the CFS. Another 100 bales were received at CFS Mundra on 23rd October 2009 under gate pass No. 64723. Accordingly, total 250 bales were present in the said CFS as on 23rd October 2009. Between 10:00 p.m. to 10:30 p.m., it was noticed by a worker that fire had erupted in the warehouse. The local police and the Insurance Company were informed by the complainant. A preliminary surveyor Mr U.C Nahar was appointed who submitted his report on 26th October 2009 estimating a loss of 250 bales in the fire. The Insurance Company further appointed the final surveyor namely MS Associates. MS Associates submitted the final survey report on 5th March 2010 assessing the loss to the tune of Rs.30,55,800.68. Not satisfied with the report of the surveyor, the Insurance Company appointed an investigator namely ‘Decent Investigators’ and the investigator submitted its report on 2nd September 2010.On the basis of the investigator’s report, the Insurance Company repudiated the claim vide their letter dated 4th November 2010 on the following grounds:-

“1. Lack of the definite documentary evidence confirming identification of property damaged due to fire.

2. New Invoices were generated after the loss with changes made with regard to important details/information relevant to the admissibility of the claim.

3. Submission of different invoices with same serial numbers.

4. Documentary evidence submitted to our investigator by CFS confirming that the goods against which the claim was lodged were already shipped and further confirming that out of 1750 cotton bales which entered the CFS in October 2009, 1500 bales were already shipped and balance bales were entered CFS on 25th October 2009 i.e. after the loss.

5. Lot of corrections/overwriting subsequently done on important documents viz dates, destination, and name of carriers etc. differences in the detail are observed even in duplicate/triplicate of same documents.

6. Non submission of satisfactory clarification/explanation called for by us in support of admissibility of the claim.

7. Since exact cause of fire was not established it was felt that forensic report only could have helped to ascertain the cause of loss. But inspite of our request the same was not made available.

3. Aggrieved by the repudiation of the claim, the complainant filed a consumer complaint being CC/12/87 before the State Commission. The complaint was resisted by the opposite party Insurance Company on the same grounds as were taken in the repudiation letter. The State Commission vide it's order dated 17th February 2016 dismissed the complaint.

4. Hence the present appeal.

5. Heard the learned counsel for both the parties and Perused record. The learned counsel for the appellant has stated that the State Commission has missed and misinterpreted the averments made in the complaint as well as in the evidence affidavit of the appellant and has accepted the version of the opposite party Insurance Company. The State Commission has found respondent Insurance Company right in appointing the investigator whereas the fact is that when a final surveyor has given his final report, no further surveyor or investigator can be appointed by the Insurance Company as per section 64 UM (3) of the Insurance Act 1938 and this amounts to unfair trade practice because the law is that the insurance claim should be decided on the basis of the report of the surveyor. The report of the investigator was not given to the complainant to make any comment or response on the same. After the repudiation of the claim, the complainant came to know about the findings of the investigator’s report and then the complainant submitted a detailed reply on 18th January 2011 to the Insurance Company to reconsider the claim. However, nothing happened. That investigator did not ask any documents from the complainant nor did he verify from the complainant the documents obtained from other sources. Moreover, in support of the report, the investigator has not filed any affidavit, still the State Commission has relied upon the report of the investigator and has rejected the claim of the complainant. The learned counsel for the appellant stated that the report of the surveyor was already there and the investigator’s report cannot be accepted because the Insurance Company has not obtained permission from the IRDA to appoint another surveyor in the form of investigator.

6. It was further pointed out by the learned counsel for the appellant that in respect of the corrections and overwriting on the invoices and other documents, the fact is that the said corrections were duly verified by the surveyor from the author of said invoices and after duly being satisfied by the said investigation the surveyor had submitted its report, hence the question of raising ground that there are corrections or overwriting etc. in the material documents is irrelevant and unsustainable. The complainant had already informed to the surveyor as well as to the Insurance Company that these mistakes in the invoices were due to the software problem and the certificates to that effect were already issued by the respective suppliers. On the issue of some invoices bearing same numbers, the learned counsel informed that the respondent has refrained from providing clarification as to what different invoices were generated. In fact, there was error in the invoices as to the number and delivery point. The appellant vide letter dated 30th November 2009 clarified these mistakes and also furnished the corrected copy of the said bills to the opposite party. In fact the surveyor had verified the said details directly from the respective suppliers and had accordingly submitted its report. Hence, the question of raising doubt despite duly verifying the same should not arise.

7. The learned counsel for the appellant also emphasized that the State Commission has dismissed the complaint on the sole ground that the appellant ought to have submitted original documents in respect of procurement and dispatches of the cotton bales. In this regard the learned counsel stated that once the surveyor appointed by the Insurance Company has verified the documents submitted by the appellant from the suppliers of the appellant and in absence of any finding of the investigator on the said aspect, the observation made by the State Commission is contrary to the material on record.

8. In respect of the cotton bales that reached Saurashtra CFS at Mundra, it was stated by the learned counsel that the position was explained in the complainant’s letter dated 18th January 2011. In this letter, it has been clarified that to fulfill the commitment of export of 1,500 cotton bales, extra 250 bales were sent to the CFS as 250 bales had damaged in the fire on 23.10.2009 thus completing the remaining 750 bales to be exported which were shipped on 26th October 2009. It is true that extra 250 bales have entered the CFS on 25th October 2009, but these were sent after the earlier sent 250 bales were burnt in the fire on 23rd October 2009.

9. In fact, entry of 250 bales on 25th October 2009 inside the CFS does not preclude the fact of loss of 250 cotton bales in the fire on 23rd October 2009. Investigator has not inquired into the incident of fire and the loss suffered by the complainant in this fire. Therefore, the report of the investigator is misleading and claim cannot be settled on the basis of this report.

10. On the other hand, the learned counsel for the respondent Insurance Company stated that the surveyor has assessed the loss only on the basis of information and documents provided by the insured as he did not verify from the damaged stocks, the stocks pertaining to the complainant as damaged stocks of all other exporters were lying in the open at the CFS. The surveyor has also reported that there were corrections on the invoices and other documents though he has verified from the respective parties. In these circumstances, the Insurance Company did not accept the report of the surveyor and appointed an investigator. The investigator's report revealed that the total stocks sent to the CFS was 1,750 cotton bales in the month of October 2009 whereas 1500 bales were shipped and 250 bales were still lying with the CFS at the end of the month. The Insurance Company therefore concluded that no stock of the complainant was lost either in the fire or otherwise. The State Commission has observed that the complainant did not produce any original document i.e. neither the purchase bills or invoices nor the papers relating to dispatch. The reply of the complainant that the same were produced before the surveyor and he has accordingly submitted his report is not sufficient. The State Commission has also found no illegality in the appointment of the investigator. If the Insurance Company is not satisfied with the report of the surveyor and wants further probe in the matter, an investigator can be appointed. An investigator is not a surveyor and therefore there is no question of violation of section 64 UM (3) of the Insurance Act 1938.Hence, the claim of the complainant has been rightly repudiated and the State Commission has rightly dismissed the complaint upholding the repudiation.

11. I have carefully considered the arguments advanced by both the parties and have examined the material on record. From the facts of the case and on the basis of the report of the surveyor as well as that of the investigator, the main issue that emerges in the present complaint is whether the complainant has suffered any loss and whether its 250 bales have been lost in the fire. Clearly, the surveyor has not verified from the burnt stocks lying in the open at the CFS and the surveyor has assessed the loss only on the basis of the report of the preliminary surveyor as well as on the documents provided by the complainant as would be clear from the following observation of the surveyor:-

“Report – In course of our inspection the losses were observed few nos. of photographs were taken for evidence. The state of damaged were partly burnt and muddy water soaked. The consignment was declared as unfit for use, the reasons were also discussed with the representative of the insured since these were for export hence any deviation in specifications and quality will not be accepted. The reason stated by the insured representative appears to be genuine and practical. Since there were many nos. of consignment of cotton bales of different firm. The affected cotton bales were thrown in the campus of CFS without separating the stock party wise. Hence the physical assessment could not be carried out.

Hence the undersigned has no alternative to assess the loss on the basis of documents of dispatches rendered by the insured. In course of scrutinizing the papers of dispatches some irregularity in document of dispatches were observed and clarification were asked from the insured which are being attached here with. The clarification rendered by the insured which required authentications from the supplier and transporters were also obtained and being attached here with for your perusal and considerations.

PRELIMINARY SURVEY REPORT- The preliminary survey was conducted by Mr. U.C.Nahar of Ahmdabad who has confirmed the quantity of 250 nos of fully pressed cotton bales copy of which is being attached here with.

ASSESSMENT

As per the Note of consent issued by the Saurashtra Containers Pvt. Ltd. Dtd.31-10-09 250 nos of fully pressed cotton bales burnt.”

12. It is also seen that though the surveyor has given details of the arrivals of the cotton bales from two different suppliers namely Raghuvir cotton and Bansi cotton on different dates however, in this chart, the surveyor has not mentioned the quantity of cotton bales stuffed in each truck and therefore it is not possible to calculate how much cotton arrived on which date. The surveyor has also reported that there were corrections and overwriting on various invoices and other documents. Though the report of the surveyor gives indication that surveyor has verified from the parties about genuineness of these papers, however, the fact remains that corrections and overwriting on the important documents on which the claim has been made create doubt on the genuineness of these documents. Clearly, such a report of the surveyor cannot be accepted by any Insurance Company and I also feel that the Insurance Company was justified in appointing an investigator. This is not important whether an investigator was appointed under rules or otherwise, the important issue is that if any fact has been brought by the investigator and the claim has been repudiated on this fact, then what is the response of the insured on this fact?. It is important to note the following observation of the investigator:-

“While going through the above documents provided to me by M/s.Saurashtra containers Pvt. Ltd. regarding the consignments of Insured, it is noted that from 01/10/09 to 31/10/09 total number of bales received by M/s Saurashtra Containers Pvt. Ltd. is 1750 bales, out of which 1500 bales are loaded in the container for export on 22/10/09 & 23/10/09 and balance 250 bales are shown as lying with them, therefore, this fact may be taken note of, as per the above 1500 bales stand dispatched & 250 bales are lying with them.”

13. The report of the investigator was available with the complainant before filing the complaint. The basic issue to be clarified by the complainant should have been in respect of the total cotton bales sent to the CFS during the month of October 2009 and to confirm or deny the balance of 250 bales at the end of the month of October 2009 with the CFS as claimed by the investigator. This was also a specific ground of repudiation and therefore the complainant should have clarified this issue in the complaint at the first instance and then in the appeal. In fact, the complainant has not clarified this issue in the complaint rather, the complainant has dealt with this issue in the following manner in the complaint:-

“With further reference to the ground No.4 of the Opposite parties in it’s repudiation letter complainant state that a investigator appears to have been appointed by the opposite parties somewhere around August 2010 that to without informing the complainant. Moreover the report submitted by the said investigator was not even disclosed to the complainant and a direct repudiation letter based on the said alleged investigators report was sent to the complainant. Complainant states that complainant was not even given an opportunity to see the said so called investigators report and make it’s submission. In fact receiving the said repudiation letter complainant called upon the opposite parties to furnish the copy of the said report. Accordingly said report was furnished to the complainant on 9-11-2010. Complainant states that said investigator has allegedly submitted certain documents alongwith the said report duly signed by him. On perusal of the said alleged documents complainant contacted the said CFS and called uponthem the genuineness of the said documents supplied with the copy of the said investigation report. Complainant states that complainant made due clarification vide his letter dated 18th January 2011 and furnished all the relevant documents to support their statement that the report submitted by the said investigator was per say bogus and was prepared with a sole intentions to support the opposite parties to wrongly repudiate the claim of the complainant.”

14. The complainant has further mentioned the following:-

“Complainant states that whatever consignment was exported, was exported after being inspected by the Customs Dept. and it was easy for the said investigator to make enquiry with the said Customs Dept. about what was exported and what wasn’t, but there is no reference of any such enquiry made by the said Investigator. Apart from such an enquiry, the complainant had furnished the damage certificate as well as salvage refund certificate alongwith the proof of payment received from the CFS, which abundantly clarified the genuine stand of the complainant and in fact there is no reference of the said aspect in the said so-called investigation report submitted by said investigator. Complainant states that it is a simple logic that if the said goods were not stored at the date of incidence then how the gate pass were issued for the same by the CFS (which is a Customs Bonded Place). Complainant states that if according to the said investigator said stock of 250 bales were stored on 25th Oct. 2009 i.e. after the date of incidence, then he ought to have supplied his reasoning why the refund of an amount of Rs.1,26,541.41 towards the salvage was paid to the complainant by the said CFS. The said investigator is cleverly silent on all these aspects but on the ground of bogus documents obliged the opposite parties by submitting a report favoring the opposite party. Complainant states on bare perusal of the said report it is clear that the said investigator has not mentioned the name of the person with whom he allegedly met and the name of the person who allegedly signed the said documents presented by the investigator to the opposite party.”

15. Even in the first appeal, the following treatment has been given by the complainant to this issue:-

“J. It is submitted with respect that the appellant was in no way concerned with the investigators report. In this connection, it is submitted that the Investigators report submitted by the Insurance Company is not supported with an affidavit of investigator and therefore the said report has no evidential value. However, the State Commission has erred in giving importance to the findings of the said investigator. Therefore, the entire exercise undertaken by the Insurance Company to repudiate the legitimate and valid claim of the appellants only on the ground that the appellants ought to have furnished the original documents is bad in law.”

16. It will be seen that neither in the complaint nor in the appeal, any specific counter view has been submitted by the complainant against the report of the investigator. It is only mentioned that after receiving the repudiation letter and after knowing that repudiation has been made on the basis of the investigator’s report, the complainant sent a letter dated 18th January 2011 to the Insurance Company clarifying the issue. I have also perused the letter dated 18th January 2011 and in respect of this issue which is point No.4 in the repudiation letter, the following has been mentioned in this letter:-

“In addition to the facts narrated above we give below our point-wise reply to the reasons/grounds on which our claim cannot be repudiated as stated in your above-mentioned letter:-

1. Your Point N.:1,4,5:We have already submitted to you several times over the past 15 months the entire documents evidencing the fire of our 250 bales and once again submit herewith copy of related documents stated above for your ready reference attached herewith as Annexure-9.”

17. From the response of the complainant given in different documents in respect of the investigator’s report, it is clear that in no document, the complainant has given a clear view in respect of the total supplies of cotton bales to the CFS in the month of October 2009 and in respect of the investigator’s finding that there was a balance of 250 cotton bales with the CFS at the end of the month of October 2009. In fact, the complainant has not given details of the total fulfillment of the order received from the German firm for supply of 1500 cotton bales. The complainant has confined its pleadings only in respect of supply of 1,000 cotton bales. Thus, the complainant has not given the clear picture of the total receipt, stuffing and shipping at

CFS for export of 1500 cotton bales and when the investigator has given the total transactions for the month of October 2009, the complainant has chosen not to completely deny the same or to give his version of the supplies, export and balance with the CFS during the month of October 2009. It is thus certain that the complainant does not have anything to counter the finding given by the investigator. Hence the State Commission has rightly accepted the report of the investigator even if it is not supported by an affidavit of the investigator because it is only the fact given by the investigator that is being considered. If the fact arrived at by the investigator is wrong, then the complainant should have provided a complete denial with proof of the same which has not been done as examined above. The report of the investigator is based on the information provided by M/s Saurashtra container private limited. The investigator has received the following documents from them:- “(1) Carting details from 01/10/09 to 31/10/09 for 18 trucks with job numbers. (2) Carting details from 01/10/09 to 31/10/09 for 18 trucks with shipping Bill numbers. (3) Container Load Plan of S/B no.6348433 dated 22/10/09 for loading 750 bales in five containers. (4) Container Load Plan for S/B no.630329 dated 26/10/09 for loading 750 bales in five containers. (5) Gate passes of 18 trucks entering into container station on various dates. (c) Balance bales in the container station from 01/10/09 to 31/10/09.” 18. The complainant may have produced different set of documents denying the correctness of these documents from the Saurashtra container private limited or from the CFS but nothing of this sort has been done by the complainant. 19. After the above examination, there is no need to further examine any other point of repudiation mentioned in the repudiation later of the Insurance Company for which the complainant has provided explanations. It will not make any difference if these explanations are accepted or rejected as the appellant/complainant has not been able to controvert the finding of the investigator in respect of the stock and the loss. 20. Based on the above discussion, I do not find any merit in the appeal and consequently the first appeal No. 383 of 2016 is dismissed.