ORIENTAL INSURANCE COMPANY LIMITED Vs. J.K. CEMENT WORKS
LAWS(SC)-2020-1-82
SUPREME COURT OF INDIA
Decided on January 28,2020

ORIENTAL INSURANCE COMPANY LIMITED Appellant
VERSUS
J.K. CEMENT WORKS Respondents


Referred Judgements :-

YOUNG V. SUN ALLIANCE AND LONDON INSURANCE [REFERRED TO]
BAJAJ ALLIANZ GENERAL INSURANCE CO. LTD. V. M/S. GONDAMAL HARDYAL MAL [REFERRED TO]
VASANT SHANKAR TORASKAR VS. SHREEJI BUILDERS [REFERRED TO]
DLF HOME DEVELOPERS LIMITED VS. PRADEEP KUMAR [REFERRED TO]


JUDGEMENT

MOHAN M.SHANTANAGOUDAR,J. - (1.)This appeal arises out of the judgment dated 18.11.2008 passed by the National Consumer Disputes Redressal Commission ('NCDRC') in Original Petition No. 59 of 2005. Vide the impugned judgment, the NCDRC allowed the consumer complaint filed by the Respondent herein, directing the Appellant to pay Rs. 58,89,400/ to the Respondent, along with interest @ 9% per annum from 01.06.2004 till the date of payment.
(2.)The brief facts giving rise to this appeal are as follows:
2.1 Respondent herein (Complainant) is a cement manufacturer, having a factory in Nimbahera, District Chittorgarh, Rajasthan. These factory premises included an open coal yard, where a stock of coal that was used in the manufacturing process was stored.

2.2 The Respondent purchased a Standard Fire and Special Perils insurance policy from the Appellant herein for the stock of coal for the period between 20.11.2002 and 19.11.2003. Among other things, the policy covered damage caused by "Storm, Cyclone, Typhoon, Tempest, Hurricane, Tornado, Flood and Inundation".

2.3 Due to heavy rains in Nimbahera on 29.08.2003 and 30.08.2003, some of the coal was washed off, and the stock of coal suffered damage. Consequently, on 01.09.2003, the Respondent informed the Appellant of the damage and requested the appointment of a surveyor. The surveyor so appointed submitted its report on 29.03.2004, assessing the loss caused to the Respondent at Rs.58,89,400/.

2.4 Upon receiving such report, the Appellant sought a clarification from the surveyor, as to whether the loss could be said to have been caused by "Flood and Inundation" in terms of the wording of the insurance policy. The Appellant also hired a Chartered Accountant to verify the declarations submitted by the Respondent visàvis its accounts books and daily stocks.

2.5 On 13.08.2004, the surveyor reaffirmed its stand that the losses in question were payable to the Respondent as per the terms and conditions of the policy. On the other hand, the Chartered Accountant hired by the Appellant reported on 02.09.2004 that he was unable to verify the declarations because the Respondent had not provided the necessary documents to him.

2.6 Notably, vide letter dated 14.12.2004, the Appellant repudiated the Respondent's claim on the ground that the loss caused to it did not fall within the scope of the policy, having occurred due to heavy and extraordinary rain and not 'flood' or 'inundation'.

2.7 Aggrieved by this repudiation, the Respondent filed a consumer complaint before the NCDRC seeking compensation to the tune of Rs.1.32 crores. Vide the impugned order dated 18.11.2008, the NCDRC allowed the complaint to the extent of the loss assessed by the surveyor, i.e. Rs.59,89,400/, and directed the Appellant to pay the said amount along with interest at the rate of 9% per annum. The instant appeal has been filed by the Appellant against this order.

(3.)Heard learned counsel for the parties.
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