“SUPREME COURT HELD THAT IT IS INCUMBENT UPON THE INSURANCE COMPANY TO PROVE AS TO HOW THE CASE FALLS WITHIN EXCLUSIONARY CLAUSE WHILE REPUIDATING A CLAIM AND ALSO TO GIVE COGENT & SATISFACOTRY REASONS FOR NOT ACCEPTING THE SURVEYOR’S REPORT”
IN THE SUPREME COURT OF INDIA
(CIVIL APPELLATE JURISDICTION)
CIVIL APPEAL NO. 4979 OF 2019
NATIONAL INSURANCE COMPANY LTD. …..APPELLANT
VERSUS
VERSUS VEDIC RESORTS AND HOTELS PVT. LTD. …..RESPONDENT
In this case the respondent/complainant who is running a Resort at Village Shikharkpur, P.S. Rajarhat, District 24- Paraganas, (South) of West Bengal purchased two insurance policies from the appellant/Insurance Company.
The first policy was for the period from 16th September, 2008 to 15th September, 2009 for the buildings of the said Resort with plant and machineries accessories and furniture etc. and the other one for the period from 13th July, 2009 to 12th July, 2010 in respect of two hotel buildings at the said resort with stock.
According to the respondent/complainant on 23rd August, 2009 at about 5.00 p.m., a mob of about 200-250 persons entered the resort and damaged/destroyed the insured property resulting in loss to the complainant.
The incident was reported to the police and the FIR being was registered on the written complaint given by an employee of Vedic Village Resort, P.S. Rajarhat.
On the same day an another FIR was also registered at P.S. Rajarhat for an offence against alleged person and his associates, at the instance of a written complaint given by a person to the effect that when the said person and his brother were returning home, they saw a football match going on in a Ground.
When the said football match was going on, suddenly alleged person and his associates started firing and hurling bombs to postpone the match. As a result, thereof, the brother of the said person received gunshot injury on his person causing his instant death. Several other spectators also received injuries due to bomb explosion.
During the course of investigation, it was revealed that the accused and his associates after the firing and throwing bombs at the football match venue, and upon being chased by the crowd, took shelter in Vedic Resorts and Hotels Pvt. Ltd. of the respondent/complainant.
Since the alleged accused and his associates were given shelter in the said Vedic Resort, the crowd chased them and damaged the insured property of the respondent/complainant.
During the course of investigation, the police conducted a search of Vedic village on 24th August, 2009 and found that there were pipe guns, live bombs in gunny bags and explosive substances found and recovered from the housing material-cum-electrical store room situated within the compound of the Vedic village of the respondent/complainant.
After Claim for damage was lodged by the respondent/complainant, the appellant/insurer appointed a surveyor and as per the Final Survey Report dated 16.06.2011, the Surveyor assessed the loss to the buildings and contents to the extent of Rs. 197.842 lakhs in one policy and the loss to the crockery and cutlery to the extent of Rs. 4.274 lakhs in another Policy. An aggregate loss was assessed to the tune of Rs. 202.216 lakhs under both the policies by the surveyor.
However the appellant/Insurance company repudiated the claim of the respondent/complainant vide letter 06.07.2012 inter alia stating that loss in respect of which the subject claim was made, was an outcome of the malicious act and therefore fell within the exclusions under Clause V(d) of the Subject policies; and that there had been a breach of warranty on the part of the assured in respect of the class of constructions covered under the subject policies.
The respondent/complainant therefore filed the Consumer Complaint challenging the said repudiation of claim before the National Commission, which by the impugned order dated 07.01.2019 partly allowed the complaint filed by the respondent/complainant and directed the appellant/insurance co. to pay a sum of Rs. 202.216 lakhs to the respondent/complainant along with interest @ 9% per annum from six months from the date of judgment of the claim till the date on which the said payment is made.
Aggrieved of the above order of the National Commission, appellant/Insurance Company filed the instant appeal before the Supreme Court.
The appellant/Insurance Company vehemently submitted that the respondent/complainant had harboured the hard-core criminal and his associates who had killed one person and injured many others at the football match venue, using illegal fire-arms and explosives stored at his own compound of Vedic village and had invited public grudge which had caused damage to his insured property.
Hence, according to appellant/insurance co., the loss suffered by the respondent/complainant was an outcome of the malicious act on the part of the management of Vedic village, which fell within the exclusions provided under Clause V(d) of the Insurance Policy.
It was further submitted by the appellant/insurance co. that the Survey Report of the Surveyor opining that the loss had occurred due to the insured peril and the claim was admissible was highly erroneous and could not be treated as final.
However, the respondent/complainant in its submissions before the Supreme Court supported the findings recorded by the National Commission that the repudiation of his claim by the appellant/Insurance Company was erroneous and the Commission had rightly granted the same.
It was observed by the Hon’ble Supreme Court in the instant case that the appellant/Insurance company had repudiated the claim of the respondent/complainant taking recourse to the said Clause V(d) of the subject policy on the ground that the loss caused to the respondent/complainant was an outcome of the malicious act/acts on the part of the respondent/complainant Vedic Village management and it fell within the exclusions provided under Clause V(d) of the Insurance Policy.
For the purpose of coming to the said conclusion, the appellant/Insurance Company in its letter dated 02/05/2011 while repudiating the claim of the respondent/complainant, had relied upon the incident which had taken place at the football match ground, where the accused person and his associates had fired and caused death of one person and injured others, and thereafter they had taken shelter at the Vedic Village of the respondent/complainant.
It was noted by the Supreme Court that though, it is true that the said accused and his associates had taken shelter at the Vedic Village when the mob became frenzied and chased them, and though it is also true that during the course of investigation the pipe guns and other explosive materials were found lying in the compound of Vedic Village, nonetheless the alleged incident of firing and causing death of a person appears to have taken place on the spot during the football match being played at the football ground. There is hardly any material to show that the entire incident and the resultant damage to the insured property was caused as a result of the malicious act of the respondent/complainant.
The Hon’ble Supreme court while relying to the precedence in law on the subject held that it is trite to say that wherever such an exclusionary clause is contained in an insurance policy, it would be for the insurance co. to show that the case falls within the purview of such clause. In case of ambiguity, the contract of insurance has to be construed in favour of the insured.
The court believed that In the instant case, the appellant/Insurance Company had failed to discharge its burden of bringing the case within the exclusionary clause V(d) of the policies in question. The surveyor in the Final Survey Report dated 16.06.2011 had also opined that the loss had occurred due to the insured peril and the claim was admissible.
It was observed by the Court that though it is true that the Surveyor’s Report is not the last and final one nor is so sacrosanct as to the incapable of being departed from, however, there has to be some cogent and satisfactory reasons or grounds made out by the insurer for not accepting the Report.
Accordingly the Hon’ble Supreme Court having not found any merits on the appeal of the insurance co., dismissed the appeal.
