INTERNATIONAL CORPORATION Vs. EXPORT CREDIT GUARANTEE CORPORATION OF INDIA LTD
LAWS(NCD)-2020-10-41
NCDRC
Decided on October 21,2020

International Corporation Appellant
VERSUS
EXPORT CREDIT GUARANTEE CORPORATION OF INDIA LTD Respondents


Referred Judgements :-

BHS INDUSTRIES VS. EXPORT CREDIT GUARANTEE CORP [REFERRED TO]


JUDGEMENT

V.K.Jain, J. - (1.) The appellant/complainant is a partnership firm, engaged in export of goods. The complainant/appellant supplied goods to an overseas buyer namely M/s QT Dog LLC. The complainant/appellant obtained an insurance cover from the respondent in respect of the consignment of goods sent to the overseas buyer. The overseas buyer having not paid the price of the goods, the complainant/appellant raised a claim with the respondent, in terms of the insurance cover which it had taken in order to cover the risk. The claim was repudiated vide letter dated 12.05.2008 which, to the extent it is relevant, reads as under: This has reference to your above claim filed alongwith connected papers. We regret to inform our inability to consider liability for the claim as following non-compliances of basic policy terms & conditions are observed in the claim- 1. Clause (3)(a) act of omission or commission of any insurer of the goods:- M/s International Corporation & M/s Stelco Overseas Pvt. Ltd. are associate companies, as Mr. Ashok Jain and Mr. Anil Jain are the common directors/partners in both of companies, this was not communicated by you while submitting your SSP Proposal. 2. Clause (3)(d):- There is dispute raised by the buyer due to non-performing the obligations under the Contract and supply of goods of poor quality by M/s Stelco Overseas Pvt. Ltd. As per records available with the Corporation, since the management of both the companies is common, both are associate companies. The buyer's contention that they are equally responsible to fulfill the earlier pending orders by M/s Stelco Overseas Pvt. Ltd. is in order. M/s Stelco Overseas Pvt. Ltd. was holding SCR Policy from SME Delhi Branch and not paid the premium of the shipment declarations for the period April 2002 to Jan 2004, there is a shortage of RRs.57,995.00, which was called vide letter dated 24.05.2004 (copy enclosed).Thus our experience with your group concern has also not been good.
(2.) Being aggrieved from the rejection of the claim, the complainant approached the concerned State Commission by way of a Consumer Complaint. The complaint was resisted by the respondent primarily on the grounds on which the claim had been rejected. The State Commission having dismissed the Consumer Complaint, the complainant/appellant is before this Commission.
(3.) It would thus be seen from a perusal of the repudiation letter that the claim was repudiated on two grounds. The first ground was that STELCO Overseas Pvt. Ltd., through which the transaction was entered into by the complainant with the overseas buyer, was a sister concern of the complainant and this fact was concealed by the complainant while obtaining the insurance coverage. The second ground on which the claim was repudiated was that the buyer had claimed that the quality of the goods was poor and therefore, it was not liable to pay for the said goods.;


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