- (1.) By a policy dated May. 1, 1947 the respondent insured the appellant as the mortgagee and a firm of the name of Bombay Import and Export Agency as the owner; against loss suffered by the destruction of or damage to certain goods by fire between March 20, 1947 and, March 20, 1948. For the period covered by the policy prior to its date presumably there existed provisional policies but with these, if any, we shall not be concerned. The Insurance was subject to various conditions and stipulations printed in the policy of which cl. 10 was in the following terms : "10. This Insurance may be terminated at any time at the request of the Insured, in which case the Company will retain the customary short period rate for the time the Policy has been in force. This Insurance may also at any time be terminated at the option of the Company, on notice to that effect being given to the insured, in which case the Company shall be liable to repay on demand a rateable proportion on the premium for the unexpired terms from the date of the concealment." The word "Company"in this clause refers to the insurer the respondent. Originally the policy did not afford any insurance against loss caused by persons taking part in riot or civil commotion but by subsequent agreements made from time to time it was extended to cover these riot risks. One of such agreements covered the riot risks occurring between July 18, 1947 and August 17, 1947.
(2.) It is not in dispute that from early 1947 the whole of Punjab including the town of Amritsar was disturbed by the serious riots and civil commotion which preceded the partition of India. On or about July 23, 1947, the godown at Bakarwana Bazar in Amritsar in which the insured goods were stored was looted and some of the goods were removed. Information of this loss was given by the appellant to the respondent and thereafter on August 7, 1947, the respondent wrote to the owners of the goods as follows Please remove the goods........... lying in godown at Bazar Bakarwana Amritsar to a safe locality. These stocks may be removed to any safe place in Amritsar before the 10th August, 1947 and on receipt of your information we will issue our necessary endorsement but under any circumstances we would not be on risk after the 10th instant by 4 p.m. which please note." A copy of this letter was on the same day sent to the appellant along with an endorsement reading, "please take necessary action and inform accordingly otherwise we would not be on risk after the 10th (tenth) August, 1947 by 4 p.m." The letter also stated that in case the goods were removed to a safe locality, the respondent would be prepared to sanction the removal without which sanction the benefit of the policy would on such removal have been forfeited under cl. 8 of the policy. In fact, however, the goods were not removed from the Bakarwana Bazar godown and were lost as the godown was burnt down by roiters on August 15, 1947.
(3.) The appellant filed a suit against the respondent on the policy making a claim in respect of the loss suffered by the looting of the goods on July 23, 1947 and the destruction of the goods by fire through the action of rioters on August 15, 1947. The respondent denied liability altogether, contending that there had been no looting of the goods by rioters but there was an ordinary theft which was not covered by the policy and that as it had terminated the policy with effect from August 10, 1947, by its letter of August 7, 1947 it was not liable for any subsequent loss of the goods by fire caused by rioters. The claim in respect of the looted goods was decreed by the trial court and the decree was upheld by the High Court of Punjab on appeal and is no longer in dispute. The trial court also decreed the claim in respect of the loss by fire but that decree was set aside by the High Court. The appellant has now appealed from the judgment of the High Court.;