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M/s.Shobha Agritech, Represented by its Proprietor, P. Upender Reddy v/s M/s.Gubba Cold Storage Limited, Reptd. By its Managing Director & Another

    C.D.No.60 Of 2007

    Decided On, 05 February 2010

    At, Andhra Pradesh State Consumer Disputes Redressal Commission Hyderabad

    By, SMT.M. SHREESHA
    By, MEMBER & SRI.K. SATYANAND
    By, MEMBER

    Counsel for the Complainant: M/s.K. Ravinder Reddi. Counsel for the Opposite Parties:Mr. Chintala Ramesh



Judgment Text

Oral Order(Per Smt.M.Shreesha, Hon?ble Member)


The brief facts as set out in the complaint are that the complainant, an exporter of fresh table grapes to foreign countries i.e. United Kingdom and European Union is registered with the Agricultural & Processed Food Products Export Development Authority, Department of Commerce, Government of India (for short APEDA) and also with Ministry of Commerce for import and export. The complainant was exporting grapes to European Union/United Kingdom for the past 5 years. The complainant had an agreement with M/s.Griffin & Brand (European) Ltd., U.K. for export of table grapes for the agricultural season ending in March and April, 2007. The table grapes were grown for export by complying criteria as per the specifications of EUREP GAP and natures choice for exporting to European Union/United Kingdom. The complainant got fresh table grapes packed and stored which are meant for export, from the period 1-3-2007 to 2-4-2007 in the premises of opposite parties, who are recognized by the APEDA for packing and storing of fresh fruits and vegetables for export and guided and regulated by the specifications and regulations prescribed by APEDA which are mandatory. The complainant submitted that the packed cartons/pallets were stuffed in the refrigerated containers in the premises of the opposite parties upto 2-4-2007. Five containers of table grapes packed in cartons/pallets of the said containers reached European Union/United Kingdom upto 4-5-2007. The said containers were sealed by the Liners and the Customs authorities after they were stuffed at the premises of opposite parties. The containers after reaching U.K. were opened by the importer and in one of the container some cartons in a pallet were found torn open and a presence of rat was felt by rat faeces and rat gnawings indicating infestation by rats, thereby, M/s.Griffin & Brand (European) Ltd., have referred the same to local health authorities and the authorities of Ashfort Borough Council, U.K. declared the said consignment of table grapes not fit for human consumption and the same was ordered to be destroyed at the expense of the complainant. The said container consisted of 1535 cartons of 9 K.G. each of table grapes and the value of the same was 23,025 British Pounds equivalent to Rs.19,34,100/- as per the then existing rate. The physical condition of the torn open pallets and rat faeces were photographed by the importers and authorities in U.K. The complainant submitted that the opposite parties are bound to observe the mandatory specifications and regulations prescribed by the APEDA and bound to take steps for rodent proofing and to maintain international food safety and hygiene standards in their pack house and see that no foreign matters enters the premises. The complainant submitted that because of the gross negligence and failure on the part of the opposite parties, a rat got into one of the pallets and damaged the packed table grapes which resulted in the rejection of the entire container and thereby the complainant was made to pay the dumping charges amounting to 4,618.20 British pounds equivalent to Indian Rs.3,87,928-80 to the buyer towards the same.


The complainant further submitted that the exported table grapes were of high quality and the complainant would have got best price for the same and because of the negligent manner of the opposite parties in maintaining their cold storage, the complainant was put to loss. The complainant submitted that the opposite parties collected Rs.2,76,580/- for keeping the packed grapes in their premises and the same was also acknowledged by them and therefore the complainant got issued a legal notice on 12-7-2007 demanding them to pay the damages i.e. value of the grapes, expenses incurred by the complainant and the damages as follows:


i) cost of the grapes : Rs.19,34,100-00


ii) Expenditure incurred by the complainant : Rs. 3,87,928-80


iii) Damages : Rs. 8,00,000-00


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Total Rs. 31,22,028.80


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for which the opposite parties 1 and 2 got issued a reply dated 14-8-2007. Hence the complainant approached this Commission for a direction to the opposite parties 1 and 2 to joint and severally pay Rs.31,22,028.80 ps.


Opposite parties filed counter denying the facts stated in the complaint and stated that they are not aware whether the complainant is a grape grower and exporter of fresh table grapes to foreign countries for the last 5 years and recognized by APEDA for packing and storing of fresh fruits and vegetables for export and is guided and regulated by the specifications and regulations prescribed the APEDA and also not aware of the complainant having an agreement with M/s Griffin & Brand (European) Ltd. U.K for the export of table grapes by complying the specifications of EUREP GAP and natures choice for exporting to European Union/United Kingdom. They admitted that from 1-3-2007 to 2-4-2007 the table grapes of the complainant were packed and stored with their cold storage and the packed cartons/pallets were stuffed in the refrigerated containers upto the period 2-4-2007. They further submit that they are not aware whether the five containers stuffed with table grapes and packed in cartons/pallets of said containers reached European Union/U.K. upto 4-5-2007. Opposite parties denied the allegation of the complainant that the said containers were sealed by the Liners and the customs authorities after they were stuffed at their premises. They denied the allegation of the complainant that after reaching U.K., the containers were opened by the importer and that in one of the containers some cartons in a pallet were found torn open and presence of a rat was felt by rat faeces and rat gnawings indicating infestation by rats and for the said reason M/s Griffin & Brand have referred the same to local authorities and the authorities of Ashfort Borough Council, U.K. declared the said consignment of table grapes not fit for human consumption and the same were ordered to be destroyed at the expense of the complainant.

Opposite parties further submitted that as per APEDA specifications and regulation, they have taken all precautions and steps including rodent proofing (rat traps) and maintain international food safety and hygiene standards in their cold storage. They submitted that there is no scope for entering any foreign matter into the cold storage and that there is no negligence on their part in maintaining the cold storage. They denied the allegation of the complainant that a rat entered into one of the pallets and damaged the packed table grapes which resulted in rejection of the entire container of the complainant. They submitted that there is no possibility for a rat entering into one of the carton and damaging the packed grapes with the cold storage unit of the opposite parties. They submitted that they are not aware whether the complainant paid dumping charges amounting to 4,610-20 British pounds equivalent to Indian Rs.2,87,928.80 to the buyer of the complainant towards the same and whether the grapes were of high quality and the complainant would have got best price for the same. They submitted that they observed mandatory specifications and regulation prescribed by the APEDA and also have taken steps for rodent proofing and maintained internal food safety and hygiene standards in their cold storage unit. They further submitted that the APEDA authorities inspected their cold storage unit and were satisfied with regard to the precaution and steps taken by the opposite parties and issued a certificate to that effect. They admitted that the complainant paid Rs.2,76,580/- for keeping the packed grapes in their cold storage premises and submitted that there was no negligence on their behalf in maintaining the cold storage and it was maintained as per the mandatory specifications and regulations of APEDA. They further submitted that to the legal notice dated 12-7-2007 of the complainant they issued a reply dated 14-8-2007 and submitted that they are not liable to pay Rs.31,33,028-80 ps as claimed by the complainant.


Opposite parties submitted that the claim of the complainant requires a detailed enquiry which cannot be decided summarily and that the dispute also does not fall within the ambit of Consumer Protection Act, 1986 and therefore the complainant has to file a case in civil court. They further submitted that there was no correspondence by the complainant till 12-7-2007 of the alleged rat problem and this theory of rat is an afterthought by the complainant. They submitted that they regularly clean the chambers and at no point of time found any insects like cockroaches etc. in their cold storage unit. They submit that they take utmost care in hygiene, clean the environment and also follow pest control measures at regular intervals and maintain the temperature of ) degrees to 2 degree and keep the doors closed and infact the chamber doors are tight and only opened and closed during the operations. During the period of stuffing/loading of fruits in the container, surveyor check the temperature, quality and other important parameters of the fruit at random from all the pallets of the container and even customs and central Excise people came to opposite parties and inspect the stuffing process and the representatives of the complainant are also present every time during the stuffing of the containers and therefore there is no chance of a rat entering into the pallet in the cold storage. Opposite parties submitted that their cold storage unit was established in the year 1987 and has a good reputation in Andhra Pradesh as well as in Indian Cold Storage Units and have been successfully handling many customers for export of fresh fruits since a decade and submitted that there is no negligence on their behalf and prayed for dismissal of the complaint.


In support of its case the complainant got filed the affidavit of its proprietor reiterating the facts stated in the complaint and relied upon documents marked as Exs.A1 to A21. Ex.A1 is the copy of Registration-cum-Membership certificate issued by APEDA to the complainant dated 27-2-2007. Ex.A2 is the copy of certificate of importer-exporter code (IEC) by Ministry of Commerce, Govt. of India dated 22-2-2007. Ex.A3 is the copy of agreement of trading terms between the complainant and Griffin & Brand Ltd., Ex.A4 is the bill of lading issued by Maersk Line dated 10-4-2007. Ex.A5 is the xerox copy of invoice dated 2-4-2007. Ex.A6 is the copy of Phytosanitary certificate issued by Government of India, Ministry of Agriculture dated 16-4-2007. Ex.A7 is the copy of Generalized system of preference certificate of origin dated 13-4-2007. Ex.A8 is the receipt issued by Gubba Cold storage Limited dated 2-4-2007. Ex.A9 is the copy of shipping bill for export of goods under duty entitlement pass book (DEPB) scheme dated 2-4-2007. Ex.A10 is the copy of voluntary surrender certificate of unsound food issued by Ashford Borough Council, U.K dated 4-5-2007. Ex.A11 is the statement issued by Griffin & Brand (European) Ltd., dated 16-5-2007 Ex.A12 is the certificate issued by Griffin & Brand (European) Ltd., dated 26-4-2007. Ex.A13 is the Xerox copy of the certificate issued by APEDA to opposite party No.1 dated 16-2-2007. Ex.A14 is Xerox copy of EUREP GAP certificate dated 28-6-2007. Ex.A15 is Xerox copy of photographs from website of opposite parties dated 30-6-2007. Ex.A16 is Xerox copy of procedure for grant of recognition certificate by APEDA. Ex.A17 is photographs of pallets. EX.A18 is compact disk containing photgraphs of pallets. Ex.A19 is office copy of the legal notice dated 12-7-2007. Ex.A20 are two postal acknowledgements. Ex.A21 is reply notice issued by the opposite party No.1 dated 14-8-2007.


The opposite parties on the other hand got filed the affidavit of the Director of its company reiterating the facts stated in the counter and also an affidavit of a third party i.e. Mr.K.Niranjan Kumar, Managing Director of M/s.Garc Bio Sciences Private Limited certifying that M/s.Gubba Cold Storage Ltd., strictly follows the norms of APEDA and maintain their cold storage unit with hygiene manner and regularly clean the chambers and that he visited the unit number of times and there is no possibility of any rat entering the cold storage. They relied upon documents marked as Exs.B1 to B18. Ex.B1 is the original notice issued by the complainant dated 12-7-2007. Ex.B2 is the office of reply notice dated 14-8-2007. Ex.B3 and B4 are postal acknowledgements. Ex.B5 is the copy of certificate for permanent registration issued by Dept. of Industries to opposite party dated 30-7-1987. Ex.B6 is the copy of certificate issued by APEDA to opposite party dated 16-2-2007. Ex.B7 is the copy of registration issued by ISO. Ex.B8 to B15 are the copies of the letters addressed to opposite party No.1 by various companies. Ex.B16 is the Pest Management Service letter dated 24-4-2007. Ex.B17 is the Pest Management letter to opposite party No.1 dated 30-3-2006. Ex.B18 are photos.


The brief point that falls for consideration is whether the complainant established any deficiency on behalf of the opposite party and if the complainant is entitled for the relief sought for in the complaint?


Heard both sides. Both parties also filed written arguments. It is the case of the complainant that they entered into an agreement with M/s.Griffin & Brand (European) Ltd., for the export of table grapes for the Agricultural season ending in March and April, 2007. The complainant got fresh table grapes for export and stored them for the period 1-3-2007 to 2-4-2007 in the premises of opposite party No.1. Five containers were stuffed with table grapes and sent to U.K. on 4-5-2007 and after reaching U.K., they were opened by the importer and in a container bearing No. PONU 492549-4, some cartons in a pallet were found torn open and there is presence of rat faeces and rat gnawing because of which the importer referred the same to the local health authorities who declared that the consignment is not fit for human consumption and the same was destroyed in U.K. at the expense of complainant because of which the complainant incurred a loss of Rs.19,34,100/- towards cost of grapes apart from other expenditure.


The learned counsel for the opposite parties submitted that from 1-3-2007 to 2-4-2007 the table grapes of the complainant were packed and stored with the opposite parties cold storage and from there they were stuffed in refrigerated containers in the premises of the opposite parties up to the period 2-4-2007, as such the responsibility of the opposite parties came to an end on that day. The learned counsel for the opposite parties contend that as per the bill of lading for ocean transport field by the complainant, the container was received at Mumbai by the complainant?s agent and the same was transported through Maersk India Pvt. Ltd., and no complaint was made at that point of time. We find this contention unsustainable on the ground that the complainant?s agent at Mumbai would not open the containers for inspection nor is he authorized to state that the goods were infested. The learned counsel for the opposite parties further relied upon Ex.A6 filed by the complainant which is dated 16-4-2007 issued by the Government of India, Ministry of Agriculture which states that plants or plant products have been inspected according to appropriate procedures and have considered to be free from quarantine pests and other injurious pests and are considered to confirm that there was no complaint made till 14-7-2007.


It is the contention of the complainant that opposite party No.1 was bound to observe the specifications and regulations prescribed by APEDA which is mandatory once the table grapes were stored in the premises of opposite party No.1, it is their duty to keep it safe and away from pests including rodents. In fact APEDA prescribes steps for rodent proofing and maintaining international food safety and hygiene standards. It is the opposite parties case that they have taken all precautions and steps including rodent proofing and there is no scope for the entry of any rat into the cold storage unit. The APEDA authorities inspected the cold storage unit of the opposite parties and issued a certificate which is Ex.A13 filed by the complainant and this certificate is valid upto 15-2-2009. The learned counsel for the opposite parties contended that even Customs and Central Excise officials have inspected the cold storage and the stuffing process and even the Supervisor of the complainant never made any complaint of presence of rats. He relied on Exs.A6 and A8 and contended that as per these two exhibits, the goods were in perfect condition as on 2-4-2007. Ex.A6 is the Phytosanitary certificate issued by the Joint Director of Horticulture which only states the name of the Exporter, the address of the consignee and that there was a disinfection treatment done on 13-3-2007 and this was issued on 16-4-2007 at Hyderabad. This certificate does not establish the case of the opposite parties that rat could not have entered into the carton. The description and number of package is written as 1535 boxes each weighing 9 kgs. and packed in 20 pallets. It is also evidenced in Ex.A7 which is dated 11/13-4-2007 and this certificate of a consignment of goods by the complainant to M/s.Griffin & Brand (European) Ltd., The date of the invoice is 2-4-2007 and Ex.A8 which the opposite parties are relying is only a receipt dated 2-4-2007 stating that 1535 boxes of 9 kgs. each is being sent through container PONU 492549-4 and is signed . This receipt does not state anywhere that the goods were in perfect condition and also does not have any terms and conditions printed overleaf which state that the complainant have to necessarily register a complaint or check the goods prior to accepting such a receipt. We are of the considered view that Ex.A8 does not establish the case of the opposite parties at all.


The learned counsel for the opposite parties also explained vide Ex.A16 the procedure for granting Registration Certificate in which certain important conditions are as follows:


2.1: In case the application is in order, the Fresh Fruit and Vegetable Division of APEDA at its headquarters will forward a copy of the documentation to the Packhouse Recognition Committee authorized for the purpose, for carrying out inspection of the packhouse.


2.3: The Packhouse Rcognition Committee constituted by APEDA shall carry out physical inspection of the Packhouse and its manual and procedures.


3.1: In case the Recognition Committee is satisfied that the pack house conforms to the levels stated in the scheme, it will recommend to APEDA to issue the packhouse recognition certificate. The same shall be issued by APEDA in Form-IV.


There is an elaborate procedure for granting of registration certificate by APEDA. This itself does not absolve the opposite parties from proving that there was proper rodent proofing done in their cold storage when the goods were packed and stored in their premises, it is their duty to explain as to how a rat entered into the cartons.


It is an admitted fact that an amount of Rs.2,76,580/- was paid to the opposite parties on 2-4-2007. Ex.A9 is the PMV value of 1535 boxes of 9 Kgs. each of an amount of rs.10,34,757 and the FOB value is Rs.9,40,630/-. Ex.A10 is the VOLUNTARY SURRENDER CERTIFICATE OF UNSOUND FOOD dated 4-5-2007 issued by Ashford Borough Council under the Food Safety Act, 1990 and Food Hygiene Regulations 2006. This certificate states as follows:


This is to certify that James Tamen Designation Technologist of Griffin brand European Ltd., Leacon Road, Ashford Kent TN 23 4TU has undertaken to dipose of the following foods which upon examination were found to be unsafe by consigning them to a registered carrier. The disposal shall be under the supervision of Environmental Health Staff.


The foods have/have not/will be stained


Thomson Seedless table grapes container No.PONU492449-4 1535 x 9kg.


Grower:Shobha Agritech, Hyderabad.


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13,815.15kg.

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Date 4-5-07 sd/-


This is to certify that I, the undersigned hereby voluntary surrender the above named unsound food for the purpose of having it destroyed or disposed of as to prevent it from being used for human consumption.


Dated 4-5-2007 sd/-


Ex.A12 is a certificate issued by the Managing Director of Griffin & Brand (European) Ltd., and is dated 26-4-2007 that is the date of arrival of consignment in U.K. which states as follows:


TO WHOM IT MAY CONCERN


The above consignment was delivered to G+B premises on 27-4-07, after unloading the initial first pallets rat droppings were noticed. On further inspection of the pallets carton damage conducive with rat gnawing was seen. Within cartons evidence of rat nesting was found. Pallets were placed back in the container, the doors re-sealed and the health authorities notified. On inspection by the health authorities it was agreed that rat infestation had occurred and that would dump the fruit under controlled conditions. This was done on the 4/5/07.


As for the market rate at the time it was 14.40- 15.00 per 9 kg carton

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. There has at this time been no settlement for losses that we have incurred. The aforementioned document i.e. Ex.A12 clearly establishes the case of the complainant that the consignment was delivered to the premises of M/s.Griffin & Brand (European) Ltd., on 27-4-2007 and on opening of the cartons, rat faecus were found. Ex.A10 further establishes that 13,815 kgs. were ordered to be destroyed since they were unfit for human consumption. When it is an admitted fact that the table grapes were packed and stored in the premises of opposite party No.1 and as per APEDA rules, it is their duty to maintain hygienic standards as per international food safety rules, and it is also established by the complainant that the goods which were exported to M/s.Griffin & Brand (European) Ltd., were rejected and the health authority of U.K. has branded them as unfit for human consumption vide Ex.A10, we are of the considered view that once the pallets were stored in the premises of opposite party No.1 and also packed and sealed there, it is their duty to take precautions in rodent proofing. It is evident from the record that the opposite parties have failed to perform their duty of maintaining international food and safety standards and hence there is deficiency of service on their behalf for which we direct them to pay an amount of Rs.9,41,630/- which is the FOB value of 1535 boxes weighing 9 Kgs. each together with Rs.4,00,000/- towards loss sustained and expenditure towards dumping charges etc. 4618 British pounds evidenced under Ex.A11 incurred by the complainant on account of rejection of the said consignment. The complainant did not also specifically pray for the refund of storage expenses. The rest of the amounts prayed for by the complainant is not substantiated by any documentary evidence except for the aforesaid amounts which are being allowed together with interest at 9% p.a. from 4-5-2007 i.e. the date on which the grapes were destroyed till the date of realization together with costs of Rs.5,000/-. Time for compliance four weeks. In the result this complaint is allowed directing the opposite parties to jointly and severally to pay Rs.9,41,630/- towards cost of grapes, Rs.4,00,000/- towards loss and expenditure incurred by the complainant including dumping charges etc. together with interest @ 9% p.a. from 4-5-2007 till the date of realization. We also award costs of Rs.5,000/-. Time for compliance four weeks.
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