IMPORTANT POINT
Contract of insurance is one of species of commercial transaction between insurer and insured.

Headnote:(A) Consumer Protection Act, 1986 – Section 23 – Insurance – Jewellers Block Policies – Burglary in Jewellery shop – Claim resisted on plea that burglary in shop took place during night and stolen articles kept in window display and lying out of safe in shop were stolen – Sum of Rs.36,10,211/- with 10% interest and cost of Rs.50,000/- awarded by National Commission – In absence of any ambiguity, respondent is not entitled to invoke principle underlined in rule of contra proferentem for interpreting clauses of policy – In order to claim benefit of policy, it was obligatory upon respondent to have removed insured items from display window every day after
       business hours and keep them inside safe during night hours till opening of shop next day – Likewise, all insured items inside shop should also have been kept inside safe every day after business hours till opening of shop next day – It was not done by respondent – Contract of insurance is one of species of commercial transaction between insurer and insured – It is for parties to decide as to what type of insurance they intend to do to secure safety of goods and how much premium insured wish to pay to secure insurance of their goods as provided in tariff – If insured pays additional premium to insurer to secure more safety and coverage of their insured goods, it is permissible for them to do so – In this case, respondent did not pay any additional premium to get coverage to avoid rigour of note of clauses 4, 5 and clause 12 – Order passed by National Commission set aside and complaint dismissed. (Paras 41, 42, 45 to 51)
       (B) Interpretation of Statute – Rules of Construction – When words of a statute are clear, plain or unambiguous, i.e., they are reasonably susceptible to only one meaning, courts are bound to give effect to that meaning irrespective of consequences – When a language is plain and unambiguous and admits of only one meaning, no question of construction of a statue arises, for the Act speaks for itself – Whenever NOTE is appended to main Section, it is explanatory in nature to main Section and explains true meaning of main Section and has to be read in context of main Section. (Para 42)
       AIR 1966 SC 1644 – Relied.
       Facts of case:
       Present appeal assails order of the National Consumer Disputes Redressal Commission whereby Commission allowed petition filed by respondents and directed appellant-insurance company to pay sum of Rs.36,10,211/-with 10% interest and also directed insurance company to pay costs assessed at Rs.50,000/- to respondent-Complainant.
       Findings of Court:
       Burglary took place in respondent's shop during night hours on 02.06.1995 when burglars took away jewelry (gold/silver ornaments) kept in display window and jewelry lying out of safe. Appellant was, therefore, justified in contending that the stolen articles were not covered under the policy by virtue of clauses 4, 5 of Proposal Form and Clause 12 of policy and no liability could be fastened on them to indemnify loss of such articles for awarding any compensation to the respondent. Indeed clauses 4, 5 and 12 were clearly attracted in appellant’s favour.
       Result : Appeal allowed.

JUDGMENT

A.M. Sapre, J.

C.A. No. 2140 of 2007

1) This appeal under Section 23 of the Consumer Protection Act, 1986 is filed against the order dated 19.03.2007 of the National Consumer Disputes Redressal Commission (hereinafter referred to as “the Commission”), New Delhi in Original Petition No. 375 of 1999 whereby the Commission allowed the petition filed by the respondent herein and directed the appellant-insurance company to pay a sum of Rs.36,10,211/-with interest @10% p.a. from 03.12.1995 till date of payment and also directed the insurance company to pay costs assessed at Rs.50,000/- to the respondent-Complainant herein.

2) In order to appreciate the issue involved in this appeal, which lies in a narrow compass, it is necessary to set out the relevant facts in brief infra.

3) The appellant herein is an insurance company incorporated under the Companies Act having its registered office at No. 24, Whites Road, Chennai. The respondent herein is also a company incorporated under the Companies Act, 1956 having its registered office at Oceanic Buildings, Quilon, Kerala and its branches inter alia at Janpriya Centre No.34, Sir Thyagaraya Road, Pondy Bazar, Chennai.

4) The respondent herein is the complainant. They are engaged in the business of sale of various kinds of Jewellery. The respondent is having their jewellery shop known as “Kanchana Mahal” which is situated at Janpriya Centre No.34, Sir Thyagaraya Road, Pondy Bazar, Chennai.

5) The respondent had insured their jewellery kept in their shop with the appellant under successive “Jewellers Block Policies” with effect from 02.07.1993 onwards. The procedure followed was that the respondent was required to submit proposal form. On receipt of the proposal form, the officials of the appellant-insurance company used to inspect the shop to verify the security and storage particulars.

6) The respondent filled up the insurance proposal form by providing necessary information as mentioned in the form. On the basis of the said proposal form, the appellant issued an insurance policy in favour of the respondent from 02.07.1993 to 01.07.1994. It was then subsequently renewed for further one year, i.e. from 02.07.1994 to 01.07.1995.

7) On 02.06.1995, the respondent alleged that there was a burglary in their Jewellery shop. According to the respondent, on the night of 02.06.1995, burglars broke open the locks of shutters, entered the shop and decamped with the gold and silver ornaments valued at Rs.40,63,735.53. The respondent accordingly lodged FIR at the concerned Police Station on 03.06.1995. The respondent also informed the appellant on 03.06.1995 by a telegraphic communication about this incident. By letter dated 05.06.1995, the appellant informed the respondent that a Surveyor has been appointed to assess the loss suffered by the respondent in the burglary. The surveyor then inspected the site and also examined all the relevant material, books, inventory etc. with a view to assess the actual loss alleged to have been suffered by the respondent and accordingly assessed the total loss at Rs.36,10,211/. Thereafter he submitted his report. After investigation, the police also submitted a final investigation report on 24.06.1995 treating the case as untraceable.

8) The respondent then submitted their claim with the appellant on the basis of the Insurance Policy and claimed that they are entitled to receive the value of Jewellery which they lost in burglary committed in their shop on 02.06.1995. On 19.01.1998, the Divisional Manager of the Insurance Company, Tuticorin after examining the respondent’s claim for loss of their Jewellery repudiated the claim inter alia on the ground that the stolen gold ornaments and silver articles were found to had been kept on display window and in the sales counters at the time of burglary which took place in the night of 02.06.1995, which according to appe

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2016 Supreme(SC) 34

IMPORTANT POINT Contract of insurance is one of species of commercial transaction between insurer and insured.

Cases Referred (11)

IMPORTANT POINT
Contract of insurance is one of species of commercial transaction between insurer and insured.