SANGAM HEALTH CARE PRODUCTS LTD. Vs. UNITED INDIA INSURANCE CO. LTD.

JUDGEMENT

(1.) THE complaint is filed under Section 17(a)(1) of the Consumer Protection Act, 1986 making the following averments.

(2.) THE complainant is a registered company incorporated under Companies Act and is doing business of manufacturing and marketing medical disposals namely IV Sets, syringes and needless etc. all over India and abroad since 1996. The company also does the business of trading in syringes which are manufactured by others under the company's brand SAFTI as it does not have the required manufacturing facilities. In the domestic market the sales are made through consignee agents and direct parties spread across the country. As the production was at lower volumes the company was dispatching the goods to the domestic market from factory till the financial year 1998 -99. As there was substantial increase in the production volumes from the year 1999 -2000 the complainant company has taken on lease a godown in Secunderabad at Block No. 4, Lingareddy Mansion, opp: Hanuman Temple, Sikh village, Secunderabad. The trading products made by other manufacturers under the companies brand name are duty paid goods and hence cannot be taken to factory and they are to be sent directly to the godown at Sikh village, Secunderabad. Originally the complainant company has covered only its fixed assets and stocks at factory under insurance from National Insurance Company Limited during the year 1999. As the complainant has taken godown at Sikh village, Secunderabad on lease afresh, stocks in godown at Sikh village, Secunderabad were not covered under the policy of National Insurance Co. Ltd. The complainant, therefore, decided to call for fresh quotations at the time of renewal. On 6.5.1999 the complainant company has submitted a letter to Asstt. Commercial Tax Officer, S.D. Road Circle, Secunderabad to include the godown at Sikh village as part of business premises under Section 12(1)(2) of Andhra Pradesh Sales Tax Act, 1957. Accordingly the Asstt. Commercial Tax Officer issued a Certificate of Registration including the godown at Sikh village as part of the business premises.

(3.) IT is further averred that on 26.11.1999 just before the renewal of the original policy the complainant has called for quotations from 3 leading insurance companies including the opposite party herein. Along with the letter of request dated 26.11.1999 for submission of quotations the complainant company has submitted a proposal statement giving details of fixed assets and stocks to the opposite party. In the said statement 10 items were mentioned with sum insured under different heads against each item. 1st to 9th items are situated in the factory premises bearing survey No. 182, Yellampet village, Medchal Mandal, R.R. Dist. The 10th item is Depot (finished goods). In that the sum proposed to be insured for stocks is Rs. 52,50,000. The 10th item is situated at Block No. 4, Lingareddy Mansion, opp. to Hanuman Temple, Sikh village, Secunderabad -500 011. The company has no godown either in the main factory building or in the factory premises. The complainant company has found the terms of the United India Insurance Company suitable, renewal of the existing policy was made by paying the premium to the United India Insurance Company Ltd. in the month of December 1999. However, the complainant company has sent a letter dated 15.12.1999 to the opposite party for sharing 30% premium with National Insurance Company. The policy bearing No. 51800/11/11/23/3104/99 issued by the opposite party. The fixed assets of the company were financed by Industrial Development Bank of India and the stocks were financed by State Bank of Hyderabad and the policy issued with institutional clause for Industrial Development Bank of India and State Bank of Hyderabad. In the schedule forming part of the policy the opposite party has changed the items as per their own convenience which the complainant company could not detect and understand implications of change in items till it received the claim rejection letter dated 21.5.2001 from the opposite party.