C. Sampat Singh vs National Insurance Company Limited

Bela M. Trivedi, J.—The present appeal has been filed by the appellant/plaintiff, challenging the judgment and decree dated 10/8/1994 passed by the Additional District and Sessions Judge, Beawar (hereinafter referred to as ''the Trial Court'') in Civil Suit No. 79 of 1985, whereby the Trial Court has dismissed the suit of the appellant/plaintiff, seeking recovery of Rs. 1,42,263.10 from the respondents/defendants.

The short facts, giving rise to the present appeal, are that the appellant/plaintiff was a partnership firm registered under the Partnership Act. The said firm was engaged in the business of cottons at Vijaynagar. During the period 11/3/1981 to 16/3/1981, the plaintiff-firm had booked 266 bales of cottons from Kekri to be delivered through Laxmi Transport Company to M/s. Eastern Cotton Company, Culcutta through Milap Transport Company, Delhi-Ghaziabad Border. According to the appellant/plaintiff, the said bales of cottons had reached to Milap Transport Company safely and were lying there for being delivered further to the company at Culcutta, however, on 20/3/1981, a fire broke out at the premises of Milap Transport Company, as a result of which 156 cotton bales of the appellant burnt out and others got damaged. It was the further case of the appellant/plaintiff that the appellant had got the insurance of Rs. 4 lacs from the respondent No. 1 and of Rs. 2 lacs from the respondent No. 2 in respect of the said bales of cotton. The said insurance was for the period from 20/3/1981 to 20/4/1981. The appellant, having come to know about the said fire at the premises of Milap Transport Company, informed the respondents-companies. According to the appellant, the respondent companies had appointed Mehta and Padamsey Surveyors Private Limited, New Delhi for carrying out the survey and assess the loss suffered by the appellant and others. The said surveyors submitted the report assessing the loss suffered by the appellant to the extent of Rs. 1,80,567/- for 156 cotton bales. Since some of the cotton bales were partly damaged, they were sold out by the said surveyor, and the appellant was paid net Rs. 91,224/- by cheque after deducting Rs. 193 as the bank commission. Since the respondents did not pay the balance amount, the appellant/plaintiff had filed the suit seeking recovery of Rs. 1,42,263.10, claiming interest and cost upto the date of filing of the suit and also claiming interest on the said amount at the rate of Rs. 1.50 per cent per month from the date of suit till realization.

The said suit was resisted by the respondents/defendants by filing their respective written-statements, denying the allegations and averments made in the plaint. Both the respondents had admitted that the appellant/plaintiff had taken the insurance in respect of the bales of cotton on 20/3/1981, and that the cover notes were also issued by them, however, according to them, the plaintiff had suppressed the fact at the time of taking the said insurance that the cotton bales were already burnt out in the fire, which had taken place at the premises of Milap Transport Company on that day. According to the said defendants, the plaintiff was aware about the said fire having taken place but did not disclose the said fact and had got the insurance done from them by committing fraud. The respondents therefore had contended that the cover notes issued by them were null and void. The respondents/defendants had also contended that the suit was bad for misjoinder of parties and was liable to be dismissed.

The Trial Court from the pleadings of the parties had framed following issues:--

The Trial Court out of the aforestated issues decided issue Nos. 5, 9, 11 and 12 against and rest of the issues in favour of the appellant/plaintiff. The Trial Court, after appreciating the evidence on record, dismissed the suit by impugned judgment and decree, against which the present appeal

It has been sought to be submitted by the learned Senior Counsel Mr. S.R. Surana for the appellant that the Trial Court had committed an error apparent on the face of record in not decreeing the suit though the Trial Court had accepted the case of the plaintiff with regard to the fire having taken place on 20/3/1981 at the premises of Milap Transport Company and also accepting the case that the cotton bales, which were lying at the premises of Milap Transport Roadways, were burnt and damaged. Taking the Court to the record of the case, he submitted that the documents at Ex. 14 to 18 were the documents of the respondents companies pursuant to which the appellant was also paid Rs. 91,224/- as per the letter Ex. 20, which proved that the goods in question were duly insured with the respondents/company. According to him, it was duly established from the surveyor''s report at Ex. 18 that out of the total loss of Rs. 1,80,567/- suffered by the appellant on account of damage caused to 156 bales of cottons, the respondents were liable to pay Rs. 93,850.60 for the said loss, as the payment of Rs. 91,224/- after deducting this commission of Rs. 193 was paid to the appellant by the surveyor. He submitted that the Trial Court had ignored the material documents of the appellant and recorded perverse findings while deciding the issues Nos. 5, 9, 11 and 12 against the appellant/plaintiff. He further submitted that though it was pleaded by the respondents-companies in their written statements that the appellant had committed fraud while obtaining the insurance on 20/3/1981, no evince was led in that regard by the respondents.

No body appears for the respondents companies, though duly served.

In the instant case, it appears that to prove the claim made by the appellant/plaintiff in the suit, the appellant had examined Shri Chatar Singh, partner of the plaintiff-firm as P.W. 1, Shri Sita Ram, an acquaintance of the plaintiff as P.W. 2, and one Shri R.P. Nanda as P.W. 3. The respondent No. 2-the Oriental Fire and General Insurance Company had examined one Prahlad Goyal, the Development Officer. Both the parties had led the documentary evidence also.

From the evidence on record and from the submissions made by the learned senior counsel Mr. Surana for the appellant, it appears that it was not disputed by the respondents/defendants that the cover note Ex. 4 (copy of which is also at Ex. 2) was issued by the respondent No. 1-National Insurance Company Limited on 20/3/1981 in favour of the appellant company and on account of M/s. Eastern Cotton Trading Co. Calcutta covering insurance of Rs. 4 lakhs, on the stock of F.P.F.B. 276 bales of Cottons lying in the compound of Milap Transport Roadways situated at the U.P. Boarder, for the period from 20/3/1981 to 20/4/1981. Similarly, the cover note dated 20/3/1981 at Ex. 5 was also issued by the respondent No. 2-Oriental Fire and General Insurance Co. Ltd. covering the insurance of Rs. 2 lakhs in favour of the appellant/applicant on the stock of FP and I.B. Cotton Bales lying in the said compound of Milap Transport Roadways for the period from 20/3/1981 to 20/4/1981. The insurance policy issued by the respondent No. 2-Insurance Company is on record at Ex. A/2/1. There also does not appear to be any dispute on the fire having taken place at the premises of Milap Transport Roadways on 20/3/1981 and some of the cotton bales lying at the said premises having been burnt and damaged, however, the respondent No. 1-National Insurance Company had repudiated the claim of the appellant vide the letter dated 5/7/1982 produced at Ex. 7 stating inter-alia that no liability was attached on the said company on account of the said fire in the godown of Milap Transport Roadways. Similarly, the respondent No. 2-Oriental Fire and General Insurance Co. Ltd. cancelled the cover note dated 20/3/1981 issued by it in favour of the appellant, vide the letter dated 15/7/1981 produced at Ex. 6, stating inter-alia that the said cover note was obtained fraudulently and by concealing material fact regarding the loss of goods on account of fire, which was within the knowledge of the appellant. Under the circumstances, the only question that falls for consideration before this Court is as to whether the respondents-defendants had rightly repudiated the claims of the appellant-plaintiff or not?

As stated earlier out of 17 issues framed by the Trial Court, except issue Nos. 5, 9, 11 and 12, all the issues have been decided in favour of the appellant/plaintiff. The Trial Court, after considering the evidence on record, held that the plaintiff during the period 11/3/1981 to 16/3/1981 had sent 266 bales of cotton from Kekri for being delivered to M/s. Eastern Cotton Company, Calcutta. It was also held that the said bales of cotton had reached to Milap Transport Roadways as pleaded in para 4 of the plaint. The Trial Court also held that the plaintiff had sent the other bales of cotton to other companies at Kanpur and the same also reached to Milap Transport Roadways as pleaded in para 5 of the plaint. The Trial Court, while deciding the issue No. 4, had also held that the said cotton bales described in para Nos. 3, 4 and 5 of the plaint were got insured by the plaintiff with the defendants as mentioned in para No. 7 of the plaint, and that the defendants had entertained the claims of the plaintiff in respect of 156 bales of cotton, which had got damaged on account of the fire having taken place at the compound of Milap Transport Roadways on 20/3/1981, for which the defendants had appointed the Surveyer - M/s. Mehta & Padmasey Surveyors Pvt. Ltd., New Delhi. The said findings being recorded on the basis of the evidence adduced by the appellant-plaintiff, this Court does not find any illegality or infirmity in the same.

However, The Trial Court, while deciding the issue No. 5, held that the plaintiff had failed to prove that the 156 cotton bales to be delivered to the other companies except to the companies at Kanpur, had got burnt in the fire, which had taken place at the premises of Milap Transport Roadways on 20/3/1981 and that the cotton bales to be sent at kanpur had reached Kanpur safely. Mr. Surana for the appellant/plaintiff had put much emphasis on the documents at Ex. 14 to 18 and more particularly on the document at Ex. 18 to submit that the Surveyor appointed by the respondents/defendants had disposed of the salvage and as per their report, out of 156 cotton bales of the appellant, 102 bales were affected on account of the fire and the said cotton bales having been disposed of by the Surveyor, the appellant was paid the proportionate amount of Rs. 91,224/- by way of cheque by the said surveyor. In this regard, it is required to be noted that the said document Ex. 18 is the copy of the report by one Shri M.C. Gupta on behalf of M/s. Mehta & Padmasey Surveyors Pvt. Ltd., New Delhi and does not bear any date thereon. Since no objection appears to have been taken by the respondents/defendants while exhibiting the said document before the Trial Court, the same appears to have been admitted in evidence. Now, even if the said document is held to be genuine, it has been specifically mentioned therein that salvage was disposed of without prejudice to the rights of the different insurance companies concerned. Hence, merely because the Surveyor was appointed by the respondents/defendants who had insured the cotton bales of other parties along with the appellant, to assess the loss and dispose of the salvage of goods, which were affected on account of the fire having taken place at the Milap Transport Roadways, that would not absolve the appellant/plaintiff from proving its claim in respect of the cotton bales allegedly insured with the respondents/companies.

Apart from the fact that the appellant/plaintiff had obtained the cover notes Ex. 4 and 5 from the respondents companies on 20/3/1981 i.e. on the day of fire, and not on the dates on which the cotton bales were delivered during the period 11/3/1981 to 16/3/1981 for being sent to different companies at Culcutta, kanpur and other places, the description of goods mentioned in the said cover notes is also absolutely vague. It is indeed a matter of great surprise that the cover notes were obtained from the representatives of the respondents/companies at Vijay Nagar, Rajasthan for the goods lying at the compound of Milap Transport Roadways at Delhi, Ghaziabad and that too on the date of fire only i.e. on 20/3/1981. Surprisingly, though the timings of the issuance have been mentioned in the respective cover notes, there is nothing on record to show as to exactly at what time the fire had taken place at Milap Transport Roadways on 20/3/1981. By not taking the insurance of the goods on the date of delivery and even thereafter for about 8 to 10 days, and obtaining the insurance on the date of fire, smacks of fraud on the part of the appellant/plaintiff. However, as rightly submitted by Mr. Surana for the appellant, the respondents though having pleaded fraud had not led any evidence to prove the said fraud. Thus, it could not be said that the respondents/defendants had proved that the appellant was aware about the fire having already taken place at the Milap Transport Roadways when the cover notes were obtained by the appellant on 20/3/1981.

Nonetheless, if the evidence of the plaintiff and its witnesses is closely read, it clearly transpires that the appellant/plaintiff had failed to prove that the cotton bales, which were burnt or damaged were the same cotton bales, which were insured with the respondents/Insurance Company. The P.W. 1 Chatar Singh, in his evidence, had stated inter-alia that the cotton bales to be delivered at Kanpur were not burnt and were delivered safely at Kanpur and that the cotton bales to be delivered at M/s. Cotton Companies at Culcutta had got burnt. From his entire evidence, there is no clarity as to which set of cotton bales were insured with the respondent No. 1 and which were insured with the respondent No. 2. In the report of the surveyor also, there is no clarity as to which cotton bales were damaged on account of the fire. As such in the surveyor''s report Ex. 18 relied upon by the appellant, general and common disposal of salvage has been mentioned and the loss to the appellant has been shown in respect of 102 bales out of the 156 bales. The said report does not speak specifically whether the said cotton bales were insured with the respondent-companies or which cotton bales were insured with which of the respondent companies. The appellant/plaintiff has also not proved by oral or documentary evidence that the cotton bales lost or damaged in fire were the same cotton bales which were insured as per the cover note No. 4 and 5. Under the facts and circumstances, the Trial Court has rightly decided the issue Nos. 5, 9, 11 and 12 against the appellant/plaintiff.

The learned counsel Mr. Surana has failed to point out any illegality or infirmity in the impugned judgment and decree passed by the Trial Court, and even other wise the findings as arrived at by the Trial Court being just and proper, this Court is not inclined to interfere with the same, the appeal being devoid of merits is dismissed.