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Judgment
Arguments of the parties have been heard in this complaint case.
The present complaint is filed by the complainant alleging that the complainant, a private limited company, had been doing the business of manufacturing of printed & laminated BOPP/polyester films/paper since 2012 from the premises at L 4, Site-V UPSIDS, Surajpur Industrial Area, Kansa, Greater Noida, Gautam Budh Nagar, U.P. The complainant purchased "Standard Fire and Special Perils Policy" bearing No.331150311140100000256 and endorsement No. 331150311140100000256 and paid a total premium of Rs.1,53,504/- to cover the risk of his business carried out at the said premises. The policy contains the insurance of building, furniture, fixture and fittings, office equipment, plant & machinery including piping and cables, and stock of raw material, finished products, packing material, stores and papers etc. The total value of the property which was insured was Rs.11.126 crores. The said policy was valid till 22.11.2015. A fire broke out at 11th November, 2015 at 1.00 pm and gutted the entire property. The fire had taken place due to short circuit in the UPS room of the insured premises. The opposite party was duly informed about the fire accident and a Surveyor was thereafter appointed by the opposite party. All the documents sought by the Surveyor were supplied to him. On the basis of its inspection, the Surveyor opined that the fire had taken place due to short circuit in the UPS room and also assessed the total loss suffered by the complainant as Rs.5,62,69,168/- and submitted a report on 18.1.2017.
It is submitted that despite the fact that the final survey report was prepared and submitted after inordinate delay of two years, complainant did not process its claim. Finding no other solution, the complainant invoked the arbitration clause under the policy. Delhi High Court thereafter appointed the sole Arbitrator for adjudication of the complainant's claim under the insurance policy and its quantum. On 22nd December, 2017, the complainant filed statement of claim before the Arbitrator and it was thereafter that vide letter dated 21st December, 2017 the opposite party repudiated the claim of the complainant and filed an application under Section 16 of the Arbitration & Conciliation Act to oust the jurisdiction of the learned Arbitrator.
It is submitted that despite the said fact that the Surveyor had assessed the loss to Rs.5,62,69,168/-, the opposite party repudiated the claim taking shelter of Clause 8 of the terms & conditions of the policy. It is submitted that the complainant had never played any fraud while obtaining the insurance policy and disclosed all the facts correctly as asked by the opposite party in the proposal form and the reason for the repudiation of claim is, thus, frivolous and not tenable. It is submitted that the opposite party has never disputed the fact that the complainant had been running its business from the said premises and that all the furniture and the stock lying there belong to the complainant. During the course of argument, it is argued on behalf of the complainant on instructions from the complainant who is present in the Court that the complainant is confining its claim only to the amount which has been assessed by the Surveyor i.e. Rs.5,62,69,168/- and that the said amount be directed to be paid to the complainant alongwith pendente lite interest @ 18% till the date of actual realization, alongwtih compensation for the mental agony and harassment and the litigation cost.
It is not disputed by the opposite party that the complainant was doing the business from the insured premises and that the building, machinery and the stock in that property belong to the complainant. It is, however, submitted that the lease deed in favour of the complainant, issued by the landlord of that building, was not registered and this fact was concealed by the complainant at the time of taking the policy, thus, had fraudulently taken the policy. Also that they have failed to fulfil certain obligations towards lessor under the deed and also other authorities. None of the parties filed any evidence since documents are not denied and also parties had taken number of adjournments for settlement which ultimately failed.
We have heard the arguments and perused the record. Undisputed facts are that the complainant is running a business at premises at L 4, Site-V UPSIDS, Surajpur Industrial Area, Kansa, Greater Noida, Gautam Budh Nagar, U.P. and the building, furniture, furniture and fixture and the stock etc. lying therein belong to the complainant and that he purchased the insurance policy from the opposite party covering all the materials including the building, stock, furniture & fixtures on plot No. L 4, Site-V UPSIDS, Surajpur Industrial Area, Kansa, Greater Noida, Gautam Budh Nagar, U.P. It is also the admitted fact that a fire took place due to short circuit in the UPS room and the entire place was gutted. It is also admitted fact that the information of incidence of fire was immediately given to the opposite party and the opposite party had deputed a Surveyor who gave his report dated 18.1.2017 wherein after investigation he concluded that the fire had happened because of short circuit in the UPS room and estimated the total loss to the tune of Rs.5,62,69,168/-. The Surveyor in his report has stated as under: -
"INSURABLE INTEREST-A/c Building
Towards building, being occupied under lease agreement, as mentioned above:
We have examined the lease agreement dated 19th Mar 2012 between the insured (Lessee) and the Land-lord (Lessor)- (refer Annexure 7)
The affected premises L-4, was under occupation vide the above lease agreement, found executed for a period of 72 months with its owners, Mr. Kaushal Pal. The rent deed being unregistered, we obtained an affidavit of the owner, qualifying his ownership and the rent agreement (refer Annexure 8)
The point no.11 of lease agreement, stipulate that "All damages or injury to the demised premises and to the fitting shall be repaired and/or replaced by the Lessee at his sole cost." It implies that the onus of repair or replacement of the of the damage caused is shifted to the Lessee and he is responsible to bear its cost.
The point no.17 of lease agreement stipulate that the lessee unconditionally agrees to hand over the demised premise to lessor in good condition.
The point no. 23 of the lease agreement stipulate that in case of any natural calamities the Lessor shall not be responsible for any damage done to the goods of the Lessee and the lessee will not be responsible for any loss to the building by the Act of God.
We have verified the commercial terms of the lease agreement i.e. the agreed rental was found timely paid by the lessee to the lessor, establishing the spirit of the agreement."
Therefore, it is apparent that the Surveyor has concluded that the complainant had insurable interest in his favour. The Surveyor before giving his report also perused the lease deed of the complainant. Despite this finding of fact by the Surveyor, the opposite party had repudiated the claim taking recourse to clause 8 of the terms & conditions. Clause 8 of the terms & conditions reads as under: -
"ConditionNo.8. If the claim be in any respect fraudulent, or if any false declaration be made or used in support thereof or if any fraudulent means or devices are used by the insured or any one acting on his behalf to obtain any benefit under the policy or if the loss or damage be occasioned by the wilful act, or with the connivance of the insured, all benefits under this policy shall be forfeited."
The Opposite party contends that a fraud was played upon them by the complainant who did not disclose while taking the policy that the lease deed of the plot L 4, Site-V UPSIDS, Surajpur Industrial Area, Kansa, Greater Noida, Gautam Budh Nagar, U.P. from where they were running their business was not registered. The Surveyor of the opposite party, however, is satisfied that the complainant had a lease deed. The opposite party has failed to point out any clause in the proposal form or any clause of the terms & conditions which requires the insured to disclose whether it possess a registered lease deed in his favour or not. When there is no requirement for the complainant to disclose the registration or non-registration of the lease deed at the time of filling the proposal form, it cannot be said that the complainant had intentionally concealed the fact that the lease deed of land was unregistered and thus obtained the policy by played fraud.
As regard the non-fulfilment of the obligation towards lessor or other authorities are concerned, that does not affect the validity of policy. There is thus no violation of clause 8 of the terms & conditions. The act of the opposite party, repudiating claim on a flimsy ground which did not exist at any point of time, amounts to gross injustice to the insured. The Surveyor report is dated 18.1.2017 whereby he assessed the loss of Rs.5,62,69,168/-, which was repudiated vide letter dated 21.12.2017. This further shows that despite the fact that the Surveyor had submitted a report on 18.1.2017, the decision of repudiation was taken by the opposite party only on 21.12.2017 i.e. after almost 11 months. It is also apparent that the Surveyor took two years to give its final report and even thereafter no decision was taken by the opposite party on the claim of the complainant. It was only when the matter was pending before the Arbitrator that a decision of repudiation had been taken by the opposite party. This further goes to show that the opposite party has acted in most unfair and highhanded manner.
For the reasons above, we allow the complaint. We hereby direct the opposite party to pay the sum of Rs.5,62,69,168/- (the loss calculated by Surveyor) alongwith interest @ 12% from the date of filing of the complaint till its realization and also sum of Rs.50,000/- towards litigation cost.