Assurance Co., Ltd. Vs. Parakh Foods Ltd.  INSC 1300 (28 July 2009)
APPELLATE JURISDICTION CIVIL APPEAL NO. 6892 OF 2008 New India Assurance
Co.Ltd. .. Appellant(s) Versus Parakh Food Ltd. .. Respondent(s) WITH CIVIL
APPEAL NO. 879 OF 2009
O R D E R
order we propose to dispose of the aforesaid two appeals. Civil Appeal No. 6892
of 2008 is filed by the New India Assurance Co. Ltd. as the appellant, whereas
Civil Appeal No. 879 of 2009 is filed by M/s. Cargil India Pvt. Ltd.
cross appeal. Since the facts and the issues involved in the two appeals are
similar, we propose to dispose of both the appeals by this common judgment and
appeals are filed against the judgment and order passed by the National Consumer
Disputes Redressal Commission, New Delhi (for short, `the National Commission')
in Original Petition No. 146 of 2003, whereby the National Commission came to a
definite conclusion that the loss suffered by the respondent (M/s. Cargil India
Pvt. Ltd.) had occurred on account of fire causing damage to the soya bean
stock and, therefore, as per terms of the policy, the respondent is entitled to
receive Rs. 1,70,72,876/- which is the amount of loss assessed by the surveyor
by report dated 29.10.2002 along with the interest @ 9% per annum from 1.1.2003
till the date of payment. The National Commission also directed for payment of
cost of Rs. 25,000/-. Being aggrieved by the aforesaid judgment and order, the
appellant has filed this appeal whereas the respondent has filed the appeal
seeking enhancement of the compensation awarded by the National Commission.
appearing for the appellant has drawn our attention to the entire facts of the
case in support of his contention that the soya bean stock was damaged before
the fire had taken place and in that view of the matter the stipulation in the
agreement between the parties does not entitle the respondent to receive any
damage or compensation for the loss or damage caused to the goods. In support
of the said contention the counsel also relied upon the endorsement in the
agreement between the parties, which reads as follows:
consideration of the payment by the insured to the company of additional
premium of Rs. .......the company agrees notwithstanding what is stated in the
printed exclusions of this policy to the contrary that the insurance by (items
....) of this policy shall extend to the property insured caused by its own
fermentation, natural heating or spontaneous combustion.
2 N.B. -
The expression `by fire only' in the endorsement above must not be omitted
under any circumstances."
attention was also drawn to the policy, which is the subject matter of the
claim in the present case. There is an exclusion clause in the said policy
which provides that the aforesaid insurance policy would not cover loss or
damage to property caused by its own fermentation, natural heating or
spontaneous combustion or by its undergoing any heating or drying process.
However, the respondent herein paid an extra premium of Rs. 25,000/- due to
which the exclusion clause was relaxed. In other words, because of the payment
of the aforesaid extra premium, the exclusion clause as stated hereinbefore
also became a part of the contract between the parties and, therefore, the said
exclusion clause would not be treated as excluded terms of contract but would
be treated as an inclusive clause of the contract between the parties.
instance of the counsel appearing for the parties, we have also gone through
the findings recorded by the National Commission. The National Commission on
appreciation of the entire records has come to a definite finding that there
was loss to the respondent on account of fire causing damage to the soya bean
stock and, therefore, in terms of the stipulation in the contract, the
respondent is entitled to the compensation, which was awarded by the 3 National
Commission. We have considered the evidence on record and we have no reason to
take a different view than what is taken by the National Commission.
we examine the submission of the counsel of the appellant to the effect that
there was no fire at the time when the soya bean stock was damaged, even then
in terms of the Full Bench decision of the National Commission, the appellant
would be liable to pay the loss or damage in terms of the endorsement thereof
whereby it was provided that the policy would extend to include loss or damage
even to the property insured, caused by spontaneous combustion. In other words,
even if there was no loss or damage by fire even then, for any loss or damage
caused to the property insured due to spontaneous combustion, the respondent
would be entitled to claim damages to the extent it was found to be so damaged.
aforesaid Full Bench decision of the National Commission although was
challenged in this Court was not interfered with in the decision in Civil
Appeal No. 873 of 2005 titled Oriental Insurance Co. Ltd. v. M/s. Murli Agro
of on 13.03.2008. It could not be disputed before us that the present case
would also be covered by the aforesaid decision, so far aforesaid alternative
arrangement is concerned. The NCL has given a report in terms of the request of
the surveyor assessing damage of 4 Rs. 1,70,72,876/-, which is the amount awarded.
In terms thereof, we do not find any ground to interfere with the order passed
by the National Commission.
So far as
the counter claim is concerned, we have heard learned counsel appearing for the
parties. On going through records, we find no reason to enhance the
compensation, which is fixed by the National Commission. The aforesaid amount,
which is awarded as damages to the respondent, is based on the loss assessed by
the surveyor. That being the position, no case for any enhancement is made out
by the respondent.
appeal has no merit and is dismissed. The appeal filed by the Assurance Company
also stands dismissed being devoid of any merit.
informed at the bar that the entire amount, which was awarded by the National
Commission, was paid to the respondent on execution of a bank guarantee. Since
we have now dismissed the appeal of the appellant also, the respondent stands
discharged from the bank guarantee.
parties will bear their own costs.
.......................J. [ Dr. MUKUNDAKAM SHARMA ]