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MANISH PITALE
National Insurance Company Ltd. – Appellant
Versus
Reliance Industries Ltd. – Respondent
ORDER:
The National Insurance Company Limited has invoked Section 34 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as Arbitration Act), to challenge award dated 11/2/2020, passed by an arbitral tribunal consisting of three Members. The majority award of two Members of the tribunal has allowed the claim of the respondent Reliance Industries Ltd. and held that the respondent is entitled to an amount of Rs.435.82 Crores, which was wrongly deducted by the petitioner while paying amount for loss suffered by the respondent, as per the insurance policy issued by the petitioner. The minority award of one Member of the arbitral tribunal held that the proceeding initiated by the respondent suffered from non-joinder of necessary parties, as the insurance policy was issued by other insurance companies also, although the petitioner was indeed the lead insurer.
2. The brief facts leading up to filing of the present petition are that on 2/10/2012, the petitioner issued an insurance policy called a Mega Package Policy (2012-2013) to the respondent for insurance cover for the period between 2/10/2012 to 1/10/2013. The said policy covered risk in two parts i.e. Part A pertaini
The business activities at the manufacturing unit at Hazira were irrelevant for assessing the loss suffered due to business interruption at the manufacturing unit at Dahej.
The court annulled the arbitral award for misinterpretation of insurance policy terms, improper calculation of depreciation, and lack of independent reasoning in affirming mixed assessments for claim....
Clauses in contracts that prohibit claims for damages are against public policy and void under Section 23 of the Indian Contract Act, 1872, as they undermine the sanctity of contracts.
The court upheld the validity of the arbitral award, emphasizing limited grounds for judicial interference and the necessity of demonstrating clear error or illegality.
Arbitral awards can be set aside only for patent illegality or public policy violations, not mere erroneous application of law or re-appreciation of evidence.
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