BHUPINDER CHAUDHARY vs United India Insurance Co. Ltd.

COMPLAINANT-Gas Company has claimed compensation of Rs. 5,50,800 from the OP-Insurance Company on account of theft of LPG cylinders from its godown.

CASE of the complainant, in brief, is that he is running a business of supply of LPG cylinder under the name and style of M/s. Pearl Gas Service from the abovesaid address. He got insured the gas service under Liquid Petroleum Gas Traders Policy with the OP vide Policy No. 469728 dated 6.5.1997 valid upto 5.5.1998. A theft was committed at the godown of M/s. Pearl Gas Service and FIR was lodged at Police Station, Model Town. The theft was of LPG cylinder numbering about 306 which was the property of Indian Oil Corporation under the custody of the complainant. The complainant immediately informed the Indian Oil Corporation and the OP-Insurance Company. The Indian Oil Corporation raised a debit note of Rs. 5,50,800 against the complainant for which the OP-Company is liable to indemnify. The OP replied that the claim of the complainant is not admissible due to the fact that the theft was committed by the employee on the complainant. The claim of the complainant was rejected. The OP is liable to indemnify the loss of Rs. 5,50,000 as per debit note raised by the Indian Oil Corporation. Op denied any deficiency in service on its part and averred that the claim of the complainant was not admissible and was specifically excluded under the terms and conditions of the insurance policy issued by the Op. The claim was lodged under Liquid Petroleum Gas Traders Policy. As per the special exceptions clause contained in the said policy the Company was not liable in respect of loss or damage by burglary and/or house breaking where the employee of the insured or member of the insured''s family is concerned as principal or accessory. The theft of the gas cylinders was committed by the employees of the insured the claim was not payable and was accordingly rejected by the Op-Company and due communication in this behalf was sent to the complainant. There is no deficiency in service on the part of the Op.

In order to appreciate the ground of repudiation in proper perspective the exclusion Clause No. 1 needs to be reproduced. It reads as under: "The Company shall not be liable in respect of- (1) Loss or damage by burglary and/ or house breaking where any employee of the insured or member of the insured''s family is concerned as principal or accessory. (2) Loss of damage to live stock, or motor vehicles. (3) Loss of or damage to money, securities or money, stamps bullion deeds, bonds, bills of exchange promissory notes, stock and share certificates, business books, manuscripts, documents of any kind, unset precious stones and jewellery and valuables, unless specifically declared."

BURGLARY or house-breaking has been defined by Clause ''B'' as under: "Definition -The term burglary and/or house breaking shall mean theft involving entry to or exit from the insured premises by forcible and violent means or following assault or violence or threat thereof to the insured or any employee of the insured or member of the insured''s family."

The learned Counsel is relying upon para 2 of the legal Notice given by the complainant to show that offence of theft was committed at the godown of the complainant by the employee namely Roop Kumar and Mukesh. Para 2 of the legal notice is as under: "That a theft was committed at the godown of M/s. Pearl Gas Service and a F.I.R. was lodged against Roop Kumar and Mukesh, the employees of my clinet. The F.I.R. is bearing No. 640/97 dated 13.8.1997 under Sections 408/468/471, IPC. The matter is under investigation at P.S. Model Town but no recovery has been effected so far and the Investigating Officer issued a letter dated 13.2.1998 regarding the non-recovery of the stolen cylinders.

IN our view mere suspicion of any employer against its employee of theft or burglary cannot take the place of proof until and unless statutory investigating agency under the law i.e. the police reports that theft or burglary was committed by the employee, the claim of the insured cannot be repudiated merely on the surmises and conjectures and on suspicion. IN para 2 of the legal notice it is specifically mentioned that the matter is under investigation at the Police Station Model Town but no recovery has been effected so far. Apart from this the theft of large number of LPG cylinders from the godown of the complainant shows that it is not an act of one or two employees of the complainant as a single person could have taken one or two cylinders but it is not possible to accept that one employee had taken away 366 cylidners by way of theft. Since the investigation by the police has not led to any proof that theft was committed by the employees coupled with the fact that the nature of theft and the number of LPG cylinders taken way rule out possibility of any theft or burglary by the aforesaid employee even if the complainant was having some suspicion against them.

HOWEVER, the term of contract has to be interpreted in consonance with its aims and objects. In the instant case the policy was against house breaking and burglary. Burglary and house breaking was defined as theft proceeded by violence, force or by causing injuries to the owner or employee. Exception is made if such an act is made by employee or member of the family. Word ''forced entry'' means unauthorised and restrained entry. It is not necessary that in the process injury should be inflicted. Thus in the instant case the loss suffered was huge but it could not invoke the exception clause in such a manner that could have invoked special exclusion clause even if act was done by an employee.

IT was simple case of house breaking or burglary as defined by Clause B and, therefore, the claim of the complainant was wrongly repudiated. In the result, we allow the complaint with the direction to the OP to indemnify the loss of Rs. 5,50,800 besides Rs. 50,000 as compensation and cost of litigation.

Aforesaid payment shall be made within one month from the date of receipt of this order.

COMPLAINT is allowed and disposed of in aforesaid terms. A copy of this order as per the statutory requirements, be forwarded to the parties free of charge and thereafter the file be consigned to Record Room.

COPY of this order be also sent to all the Presidents of the District Forums. Complaint allowed.