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High Court Of Calcutta
S. B. SINHA, HRISHIKESH BANERJI
NATIONAL INSURANCE COMPANY LIMITED - Appellant
Versus
NEW DARJEELING UNION TEA CO.LTD - Respondent
Appeal From Original Decree 484 Of 1997
Decided On : 08/04/2000
INSURANCE - CONTRACT - VALIDITY - WAIVER OF CONDITION - BURDEN OF PROOF - FIRE INSURANCE - LOSS OF TEA STOCK - QUANTIFICATION OF DAMAGES - INTEREST.
Fact of the Case:
The plaintiff, a tea company, filed a suit against the defendant, an insurance company, claiming damages for loss of tea stock due to fire. The plaintiff had taken out a fire insurance policy with the defendant for the tea stock. The defendant denied liability on the grounds that the plaintiff had not fulfilled the conditions of the policy and that the loss was not covered by the policy.
Finding of the Court:
The court held that the plaintiff had fulfilled the conditions of the policy and that the loss was covered by the policy. The court also held that the defendant had waived the condition that the premium must be paid in advance. The court awarded damages to the plaintiff in the amount of the cost of production of the tea stock.
Issues: 1. Whether the plaintiff had fulfilled the conditions of the policy. 2. Whether the loss was covered by the policy. 3. Whether the defendant had waived the condition that the premium must be paid in advance. 4. Whether the plaintiff was entitled to damages.
Ratio Decidendi: 1. The court held that the plaintiff had fulfilled the conditions of the policy because it had paid the premium and had given notice of the loss to the defendant. 2. The court held that the loss was covered by the policy because the fire was not caused by any of the exclusions listed in the policy. 3. The court held that the defendant had waived the condition that the premium must be paid in advance because the defendant had accepted the premium after the loss had occurred. 4. The court held that the plaintiff was entitled to damages in the amount of the cost of production of the tea stock because the plaintiff had proved that the tea stock was worth that amount.
Final Decision: The court allowed the appeal in part and reduced the interest rate from 17% to 9%.
( 1 ) THIS Appeal is directed against a judgment and decree dated 28th November, 1996 passed by a learned single Judge of this Court in Suit No. 97 of 1988 whereby and whereunder the Suit filed by the respondent herein claiming a decree for a sum of Rs. 10,39,726. 26 paise was decreed with interest.
( 2 ) THE Plaintiff-Respondent in the plaint, inter alia, stated that as regard the stock of tea owned by it, an insurance policy bearing No. 1461/3108735 dated 21st December, 1985 was taken by the plaintiff. The subject matter of such insurance was 1,64,000 Kgs. of tea, the value whereof was assessed at Rs. 36,80,000/ -.
( 3 ) ACCORDING to the Plaintiff, the cost of production of tea is Rs. 10. 23 per Kg. although the market price thereof was Rs. 22. 43 per Kg. Having regard to the loss sustained by it, it confined its claim only to the extent of Rs. 10,39,726. 26 although the goods were insured or a sum of Rs. 3,61,900. 00/ -.
( 4 ) THE learned counsel appearing on behalf of the Defendant-Appellant, inter alia, submitted that the learned trial Judge erred in passing the decree in so far as he failed to take into consideration : (1) that the claim had not been made in accordance with the policy. (2) In any event the learned trial Judge failed to take into consideration the evidence on record in the true perspective as regard the quantification of the damages allegedly suffered by the plaintiff-respondent. (3) A bare perusal of the terms of the interim protection as contained in Exbt. B read with the subsequent documents including the receipt dated 23. 12. 1985 as contained in Exbt. C it will be evident that the entire claim had been made on a wrong premise inasmuch as in terms thereof, the policy could come into effect only on 23. 12. 1985 and not prior thereto. (4) As regard the second question the learned trial Judge committed an error in considering the relevant provisions of the insurance policy as the stock of the tea earlier year could not have been the subject matter of insurance in so far as although from Exbt. S/1 and Exbt. 7 it would appear that in respect of such policy, additional premium was payable which having not been done, no relief could be granted to the plaintiff. (5) The learned trial Judge failed to take into consideration the evidence of the witnesses examined on behalf of the defendants-Appellants in their proper perspective and in this connection our attention has been drawn to deposition of D. W. 2 Budhadeb Chakraborty and in particular Question No. 361 to 363 as well as Question No. 37 to 41 of D. W. 1 Deb Kumar Basu. (6) The learned trial Judge committed an error in giving due credence to the report submitted by S. P. Banerjee dated 4. 1. 86 (Exbt. 3) and that of Sri B. Bag dated 3. 3. 86 (Exbt. 6), from a perusal whereof it would appear that value of the tea should have been assessed at the rate of Rs. 7/- per Kg. only.
( 5 ) THE learned counsel appearing on behalf of the Plaintiff-Respondent, on the other hand, submitted that a new case is sought to be made out by the appellant at this stage which should not be permitted. According to the learned counsel, the question that the appellants were not bound to indemnify the plaintiff had never been raised before the learned trial Judge not any issue was framed in that regard. The learned counsel contends that the fact that an accident had taken place being admitted, and it having not been shown that there had been any act of mala fide on the part of the insured, the learned trial Judge must be held to have acted within his jurisdiction in passing the decree. It has been submitted that in the case, the statements of the plaintiff's witnesses remained uncontroverted and the Defendant-Appellant had neither cross-examined the said witnesses on material particulars not even gave any suggestion in that regard.
( 6 ) OUR attention has further been drawn to the fact that initially the damaged tea was segregated and only such stock of tea whic
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