w w w . L a w y e r S e r v i c e s . i n



National Insurance Company Ltd. v/s M/s. Ess Ell Garments


Company & Directors' Information:- K C GARMENTS PRIVATE LIMITED [Active] CIN = U18101DL2005PTC139844

Company & Directors' Information:- D R GARMENTS (INDIA) PRIVATE LIMITED [Active] CIN = U18101GJ2005PTC046010

Company & Directors' Information:- R. R. GARMENTS LIMITED [Active] CIN = U51900MH1995PLC095544

Company & Directors' Information:- M. B. GARMENTS (INDIA) PRIVATE LIMITED [Active] CIN = U18202WB2011PTC157173

Company & Directors' Information:- S G GARMENTS LIMITED [Active] CIN = U18101WB2004PLC098193

Company & Directors' Information:- K K P GARMENTS PRIVATE LIMITED [Active] CIN = U65921TZ1994PTC005334

Company & Directors' Information:- B K GARMENTS PRIVATE LIMITED [Active] CIN = U18101DL2001PTC109850

Company & Directors' Information:- N K GARMENTS PRIVATE LIMITED [Active] CIN = U18101DL2000PTC107093

Company & Directors' Information:- K. D. GARMENTS PRIVATE LIMITED [Active] CIN = U18109WB2005PTC101896

Company & Directors' Information:- G AND A GARMENTS PVT LTD [Strike Off] CIN = U18101PB1995PTC016121

Company & Directors' Information:- V H GARMENTS PRIVATE LIMITED [Active] CIN = U52322MH2008PTC181066

Company & Directors' Information:- M S GARMENTS PRIVATE LIMITED [Active] CIN = U74899DL1991PTC046660

Company & Directors' Information:- C & Y GARMENTS PRIVATE LIMITED [Active] CIN = U25209TN1988PTC016306

Company & Directors' Information:- S. S. GARMENTS PRIVATE LIMITED [Active] CIN = U18101DL1996PTC083315

Company & Directors' Information:- R K GARMENTS PRIVATE LIMITED [Active] CIN = U18100GJ1994PTC023240

Company & Directors' Information:- H S V GARMENTS PRIVATE LIMITED [Strike Off] CIN = U18101DL2005PTC141103

Company & Directors' Information:- C B GARMENTS PRIVATE LIMITED [Strike Off] CIN = U18109WB2011PTC161559

Company & Directors' Information:- G. M. GARMENTS PRIVATE LIMITED [Active] CIN = U18109DL2006PTC152683

Company & Directors' Information:- D AND D GARMENTS PRIVATE LIMITED [Active] CIN = U74899DL1975PTC007923

Company & Directors' Information:- J S GARMENTS (INDIA) PRIVATE LIMITED [Active] CIN = U74900WB2009PTC135262

Company & Directors' Information:- K. B . GARMENTS PRIVATE LIMITED [Active] CIN = U18109WB2011PTC166954

Company & Directors' Information:- A K GARMENTS PRIVATE LIMITED [Active] CIN = U17120DL2015PTC282847

Company & Directors' Information:- D P GARMENTS PRIVATE LIMITED [Strike Off] CIN = U18101DL2004PTC129479

Company & Directors' Information:- V S GARMENTS PRIVATE LIMITED [Active] CIN = U18101DL2005PTC143084

Company & Directors' Information:- P AND P GARMENTS PVT LTD [Under Process of Striking Off] CIN = U18101DL2005PTC143556

Company & Directors' Information:- V S GARMENTS PRIVATE LIMITED [Active] CIN = U18101HR2005PTC068124

Company & Directors' Information:- L. H. GARMENTS PRIVATE LIMITED [Strike Off] CIN = U17121KA2011PTC060761

Company & Directors' Information:- K M S GARMENTS PRIVATE LIMITED [Strike Off] CIN = U18101KL2002PTC015310

Company & Directors' Information:- K R GARMENTS PRIVATE LIMITED [Strike Off] CIN = U17111WB1998PTC087046

Company & Directors' Information:- T & A GARMENTS PVT LTD [Strike Off] CIN = U52321TN1993PTC025318

Company & Directors' Information:- P. S. GARMENTS PRIVATE LIMITED [Active] CIN = U18204DL2007PTC164238

Company & Directors' Information:- S. A. GARMENTS PRIVATE LIMITED [Active] CIN = U17121DL2007PTC165007

Company & Directors' Information:- T S GARMENTS PRIVATE LIMITED [Active] CIN = U51494DL1996PTC076668

Company & Directors' Information:- GARMENTS INDIA PVT LTD [Strike Off] CIN = U51909GJ1979PTC003310

Company & Directors' Information:- I G S GARMENTS PRIVATE LIMITED [Strike Off] CIN = U18101DL2004PTC128723

Company & Directors' Information:- P V S GARMENTS PRIVATE LIMITED [Active] CIN = U18101TZ2007PTC013976

Company & Directors' Information:- M. P. GARMENTS PRIVATE LIMITED [Active] CIN = U17291DL2007PTC164129

Company & Directors' Information:- K. S. GARMENTS PRIVATE LIMITED [Active] CIN = U18101DL2007PTC164404

Company & Directors' Information:- J K GARMENTS PRIVATE LIMITED [Active] CIN = U18101DL2003PTC120039

Company & Directors' Information:- B G GARMENTS PRIVATE LIMITED [Active] CIN = U74899DL2005PTC142488

Company & Directors' Information:- V B GARMENTS PRIVATE LIMITED [Active] CIN = U18101DL1997PTC088244

Company & Directors' Information:- S S R GARMENTS PRIVATE LIMITED [Active] CIN = U74999DL1997PTC088511

Company & Directors' Information:- S P GARMENTS PRIVATE LIMITED [Strike Off] CIN = U18101DL2003PTC120709

Company & Directors' Information:- P N GARMENTS PRIVATE LIMITED [Strike Off] CIN = U51311DL2004PTC127524

Company & Directors' Information:- J B GARMENTS PRIVATE LIMITED [Strike Off] CIN = U18101PB1996PTC017533

Company & Directors' Information:- A. D. S. GARMENTS PRIVATE LIMITED [Active] CIN = U52609DL2017PTC321217

Company & Directors' Information:- H. K. GARMENTS PRIVATE LIMITED [Active] CIN = U18109DL2007PTC159196

Company & Directors' Information:- V P GARMENTS PRIVATE LIMITED [Strike Off] CIN = U18109DL2012PTC233293

Company & Directors' Information:- S T GARMENTS PRIVATE LIMITED [Active] CIN = U18109DL2015PTC277043

Company & Directors' Information:- P L GARMENTS PRIVATE LIMITED [Active] CIN = U17120DL2013PTC248417

Company & Directors' Information:- M. K. GARMENTS PRIVATE LIMITED [Active] CIN = U17291DL2007PTC164395

Company & Directors' Information:- U R GARMENTS PRIVATE LIMITED [Strike Off] CIN = U18101DL2002PTC114011

Company & Directors' Information:- N J GARMENTS PRIVATE LIMITED [Active] CIN = U18101DL2002PTC117748

Company & Directors' Information:- R A GARMENTS PRIVATE LIMITED [Converted to LLP and Dissolved] CIN = U18101DL2003PTC123385

Company & Directors' Information:- P C GARMENTS PRIVATE LIMITED [Strike Off] CIN = U18101DL2004PTC129478

Company & Directors' Information:- N V GARMENTS PRIVATE LIMITED [Active] CIN = U18101DL2005PTC133534

Company & Directors' Information:- C S GARMENTS PRIVATE LIMITED [Active] CIN = U18101DL2005PTC134787

Company & Directors' Information:- L S GARMENTS PRIVATE LIMITED [Active] CIN = U18101DL2005PTC136180

Company & Directors' Information:- B L GARMENTS PRIVATE LIMITED [Active] CIN = U18101DL2005PTC136912

Company & Directors' Information:- B D S GARMENTS PRIVATE LIMITED [Active] CIN = U18101DL2005PTC137898

Company & Directors' Information:- T G GARMENTS PRIVATE LIMITED [Strike Off] CIN = U18101DL2005PTC143392

Company & Directors' Information:- B K C GARMENTS PRIVATE LIMITED [Converted to LLP and Dissolved] CIN = U18101DL2006PTC144478

Company & Directors' Information:- R B P GARMENTS PRIVATE LIMITED. [Active] CIN = U18101DL2006PTC148881

Company & Directors' Information:- G P S GARMENTS PRIVATE LIMITED. [Active] CIN = U18101DL2006PTC149330

Company & Directors' Information:- G P GARMENTS PRIVATE LIMITED [Active] CIN = U18101DL2007PTC161067

Company & Directors' Information:- I B GARMENTS PRIVATE LIMITED [Active] CIN = U51909DL2013PTC257044

Company & Directors' Information:- G P S GARMENTS PRIVATE LIMITED. [Active] CIN = U74110DL2006PTC149330

Company & Directors' Information:- I. K. GARMENTS PRIVATE LIMITED [Active] CIN = U51109DL2008PTC180451

Company & Directors' Information:- A G GARMENTS PRIVATE LIMITED [Active] CIN = U51300DL2013PTC257609

Company & Directors' Information:- Y B GARMENTS PRIVATE LIMITED [Strike Off] CIN = U51311DL2004PTC129581

Company & Directors' Information:- V R V GARMENTS PRIVATE LIMITED [Strike Off] CIN = U51311DL2008PTC182256

Company & Directors' Information:- Y N GARMENTS PRIVATE LIMITED [Active] CIN = U81010DL2003PTC123182

Company & Directors' Information:- M V GARMENTS PRIVATE LIMITED [Strike Off] CIN = U74899HR2005PTC141797

Company & Directors' Information:- A AND R GARMENTS PRIVATE LIMITED [Strike Off] CIN = U17120HR2013PTC049037

Company & Directors' Information:- F T GARMENTS PRIVATE LIMITED [Strike Off] CIN = U18109KL2015PTC037773

Company & Directors' Information:- G AND G GARMENTS PRIVATE LIMITED [Active] CIN = U17299MH2020PTC350276

Company & Directors' Information:- V K GARMENTS PRIVATE LTD [Strike Off] CIN = U18101DL1981PTC012410

Company & Directors' Information:- P M P GARMENTS PRIVATE LIMITED [Strike Off] CIN = U18101DL2005PTC134811

Company & Directors' Information:- A S GARMENTS PRIVATE LIMITED [Active] CIN = U17212CH1992PTC012350

Company & Directors' Information:- V R GARMENTS PVT LTD [Strike Off] CIN = U18101CH1991PTC011345

Company & Directors' Information:- K M P GARMENTS PRIVATE LIMITED [Strike Off] CIN = U18109DL2007PTC162181

Company & Directors' Information:- S B GARMENTS PRIVATE LIMITED [Strike Off] CIN = U51311DL2005PTC141954

    First Appeal No. 830 of 2011

    Decided On, 11 June 2014

    At, Punjab State Consumer Disputes Redressal Commission Chandigarh

    By, THE HONOURABLE MR. JUSTICE GURDEV SINGH
    By, PRESIDENT
    By, THE HONOURABLE MR. BALDEV SINGH SEKHON
    By, MEMBER & THE HONOURABLE MRS. SURINDER PAL KAUR
    By, MEMBER

    For the Appellant: Munish Goel, Advocate. For the Respondent: R.K. Shukla, Advocate.



Judgment Text

Baldev Singh Sekhon, Member:

1. This appeal has been filed by the appellant/opposite parties against the order dated 13.4.2011 passed by the District Consumer Disputes Redressal Forum, Patiala (in short 'District Forum'), vide which the complaint filed by the respondent/complainant was allowed with Rs.5,000/- as cost of litigation and the opposite parties were directed to reimburse the claim of the complainant by making payment of Rs.2,25,917/- within a period of one month alongwith ainterest @ 9% per annum from two months after the date of filing of the report of the surveyor i.e. 6.8.2009 till final payment.

2. The facts, as stated in the complaint, are that the complainant firm is a franchisee of M/s Donear Industries Ltd. Under an agreement dated 10.6.2008, Donear Industries agreed to supply their readymade garments to the complainant firm for retail/sale. The complainant firm got insured all the stock of readymade garments with opposite party No.1, vide cover note No.400603258638 for the period 22.9.2008 to 21.9.2009 for Rs.20,00,000/- against the risk of burglary. On the intervening night of 29/30.11.2008, 252 pieces of 'D COT' manufactured by Donear Industries, worth Rs.2,51,019/- were stolen from the insured premises. An FIR was lodged with the police and opposite parties were also informed immediately. They deputed M/s J.S.Bindra for conducting preliminary spot survey and Mr.Deepak Malhotra for conducting detailed final survey. The franchisor debited the cost of the stolen goods into the account of the complainant. On 5.9.2009, opposite party No.1 refused to pay the insurance claim on the ground that the complainant firm had no insurable interest as the stock stolen belonged to M/s Donear Industries Ltd. In the complaint filed before the District Forum, the complainant firm sought directions to the opposite parties to accept their claim and to make the payment of Rs.2,51,019/- with interest @ 18% per annum from the date of loss alongwith Rs.50,000/- as compensation for harassment and Rs.22,000/- as costs of the complaint.

3. The opposite parties appeared and contested the complaint. They took preliminary objection that the complainant was stopped from filing the complaint by its own act and conduct and that the District Forum did not have the jurisdiction to entertain and try the complaint. It was pleaded that the competent authorities, after having considered the reports submitted by J.S.Bindra and Deepak Malhotra, surveyors and after having considered all the aspects of the case, closed the file of the complainant and he was informed vide letter dated 5.2.2009. In fact, the complainant firm did not have any insurable interest in the goods insured under the policy. The goods were kept by the insured as a trustee only and all purchase and sale of the goods pertained to M/s Donear Industries. Accordingly, dismissal of the complaint was prayed.

4. The parties led their evidence by way of affidavits and documents before the District Forum, which after going through the same and after hearing the learned counsel on their behalf, allowed the complaint, vide aforesaid order.

5. Aggrieved by this order, the appellant has come up in appeal on the ground that the District Forum has illegally allowed the complaint inspite of the fact that the complainant firm did not have any insurable interest in the goods stolen because the goods were kept by the insured on the Trust Basis only and all the purchase and sale were being made on the consignment belonging to M/s Donear Industries. The District Forum did not take into consideration the fact that the insurance policy did not cover the goods of third party though the same may be lying in the shop of the complainant. The opposite parties have no concern with any bilateral agreement between the complainant firm and M/s Donear Industries.

6. On the other hand, the learned counsel for the complainant submitted that there was no merit in the appeal and the same be dismissed.

7. We have thoroughly gone through the pleadings of the parties and have carefully perused the evidence on record.

8. The admitted facts of the case are that the complainant got insured all the stock of readymade garments from opposite party No.1, vide cover note No.400603258638 for the period from 22.9.2008 to 21.9.2009 for Rs.20,00,000/- against the risk of burglary. It is also not in dispute that on the intervening night of 29/30.11.2008 stock of readymade garments, worth Rs.2,51,019/- were stolen from the insured premises. Deepak Malhotra conducted the final survey who assessed the net payable loss as Rs.1,63,898/- vide Ex.R-8. However, the opposite parties, vide their letter dated 12.8.2009 (Ex.R-3), conveyed the complainant firm that the stolen goods belonged to M/s Donear Industries Limited and the complainant firm had no insurable interest in the goods insured under the policy, therefore, the claim was not admissible. The complainant firm was given 15 days’ notice to say anything in this regard, failing which, the claim was to be closed. Thereafter, vide letter dated 5.9.2009 (Ex.R-2), the claim was declared as 'NO CLAIM' on the same ground. The policy document covering the risk has been proved by the opposite parties themselves as Ex.R-4 scrutiny of which, reveals that the insured premises i.e. shop No.1, Nand Market, Rajpura, District Patiala of the complainant firm was covered under the insurance policy. The description of the items covered is defined as under:-

'ON STOCK OF ALL TYPES OF READY MADE GARMENTS AND OR ALLIED GOODS RELATED TO INSURED BUSINESS TRADE STOCK IS LYING IN THE ABOVE SAID SHOP FOR RS.20,00,000/-.'

9. It is, thus, evident all types of readymade garments, whether owned by or under the custody of the insured, lying in insured premises were fully covered. There is no reference to the ownership of the stock that was covered under the policy. Hon’ble Supreme Court, in a similar case reported as 1996 (3) SCR 500 titled as 'General Insurance Society Limited V/s Chandumull Jain', has observed that the policy document being a contract between the parties and it has to be read strictly. It was observed as under:-

'In interpreting documents relating to a contract of insurance, the duty of the Court is to interpret the words in which the contract is expressed by the parties, because it is not for the Court to make a new contract, however, reasonable, if the parties have not made it themselves. Looking at the proposal, the letter of acceptance and the cover notes, it is clear that a contract of insurance under the standard policy for fire and extended to cover flood, cyclone, etc., had come into being.'

10. The terms of the policy have to be construed as it is and the Courts cannot add or subtract something. Howsoever liberally it may construe the policy but it cannot take liberalism to the extent of substituting the words which are not intended. Therefore, it is settled law that the terms of the contract have to be strictly read and natural meaning be given to it. No outside aid should be sought unless the meaning is ambiguous. It is proved from the survey report (Ex.R-8) that stock stolen on the intervening night of 29/30.11.2008 was stocked in the insured premises as described in the policy document. Even in the FIR No.284 dated 30.11.2008 (Ex.C-4), it is mentioned that the stock of readymade garments lying in the insured premises were stolen. Thus, it is evident that the stock stolen was fully covered by the insurance policy issued by the opposite parties.

11. Once it is proved on record that the stock stolen was stocked in the insured premises, the insurance claim cannot be denied on the ground that the same did not belong to the insured. Since the damaged stock was for sale by the complainant firm under an agreement with M/s Donear Industries Ltd., the complainant firm had full insurable interest on the stock lying in the insured premises.

12. According to the claim filed by the complainant firm, stock amounting to Rs.2,25,917/- was stolen out of the total stock of Rs.27,56,804/-lying in their premises. The surveyor, while assessing the loss, reduced this amount to Rs.1,63,898/- by applying the 'average clause' mentioned in the insurance policy because the stock of Rs.27,56,804/- was under insured for Rs.20,00,000/-. Average Clause 6 of the terms and conditions of the 'Burglary And House Keeping Policy' provides as under:-

'6. AVERAGE: If the property hereby insured shall at the time of any loss or damage be collectively of greater value than the Sum insured thereon, then the Insured shall be considered as being his own insurer for the difference, and shall bear a ratable proportion of the loss or damage accordingly. Every item, if more than one, in the policy, shall be separately subject to this condition. CONTRIBUTION: If at the time of the happening of any loss or damage covered by this Policy there shall be existing any other insurance of any nature whatsoever covering the same, whether effected by the insured or not, then the Company shall not be liable to pay or contribute more than its ratable proportion of any loss or damage.'

Admittedly, the volume of stock at the time of loss was more than the sum insured. Thus, the surveyor has rightly assessed the net loss payable to the complainant firm as Rs.1,6

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3,898/- by applying average clause. 13. In view of the above said discussion and findings, the appeal of the appellant is partly accepted and the impugned order of the District Forum is modified to the extent that the amount payable to the complainant by the opposite parties is reduced from 2,25,917/- to Rs.1,63,898/-. No order as to costs. 14. The appellant deposited an amount of Rs.25,000/- with this Commission at the time of filing of the appeal and another sum of Rs.1,38,898/- as per the order of this Commission. The entire amount, alongwith interest, which has accrued thereon, if any, be remitted by the Registry to respondent/complainant, by way of a crossed cheque/demand draft, after expiry of 45 days under intimation to the learned District Forum. 15. The arguments in the case were heard on 10.6.2014 and the order was reserved. Now, the order be communicated to the parties. 16. The appeal could not be decided within the statutory period because of the heavy pendency of the court cases.
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