JUDGMENT :

(Prayer: Plaint filed under Order IV Rule 1 of the Original Side Rules read with Order VII Rule 1 of the Code of Civil Procedure, praying for the following judgment and decree :-

(a) To pay a sum of Rs.3,51,14,655/- together with interest @ 18% on Rs.2,57,45,245/- from the date of plaint till the date of realisation;

(b) Directing the defendants to pay cost;)

1. The plaintiff, which is a statutory Corporation wholly owned by the Government of Tamil Nadu, has filed the above suit seeking a money decree for a sum of Rs.3,51,14,655/- with subsequent interest at 18% per annum and for costs.

2. The plaint averments are as follows:

2.1. The plaintiff holds the monopoly for supply of Indian Made Foreign Spirits (IMFS)/Beer products all over the State. The plaintiff has its godowns and outlets spread across the State. Upon purchase of the products namely IMFS/Beer they are transported through lorries arranged by the manufacturers and suppliers from their breweries or distilleries to the 41 stock points of the plaintiff. At times there are inter stock point transfer of the products. Since the plaintiff suffered significant percentage of loss due to loss in transit, breakage, etc., the plaintiff decided to have the said loss covered by Marine Transit Insurance.

2.2. The plaintiff therefore called for tenders from Insurers approved by the Insurance Regulatory Authority (IRDA). The several Nationalised as well as Private Insurance Companies took part in the tender processes and the defendant emerged as a successful tenderer. Upon being declared as a successful tenderer, a contract of Insurance was entered into between the plaintiff and the defendant for the period between 01.10.2008 and 30.09.2009. The policy was to cover the risk against breakages, damages and all other risks including accident that may occur during the transport of the Indian Made Foreign Spirits and Beer from the breweries or distilleries to the stock points or from the stock points to the retail outlets or inter stock point transit. Along with the tender, the plaintiff also furnished the statistics for the 10 year period prior to 2008 and 2009, to enable the defendant to assess the expected risk that it would have to cover in the event it emerges as a successful tenderer. The furnishing of the statistics was only to enable the defendant to have a general idea of the risk involved in the transaction.

2.3. As per the conditions in the contract of Insurance, the plaintiff is bound to pay a premium on the expected quantity of (IMFS)/Beer that is to be transported through a month in advance at the beginning of the month and within five days after the last date of the month the premium payable for the entire volume of stock that was transported during the month is ascertained and if the premium paid is in excess, the same is to be adjusted towards the premium payable in the subsequent month. If the premium paid is in deficit, the plaintiff will have to make good the deficit.

2.4. Upon initiation of the contract from 01.10.2008 to January 2009, the defendant settled the claims of the plaintiff without any dispute what so ever. Thereafter the defendant paid only 70% of the claim and retained 30% of the claim. Despite repeated objections and requests made by the plaintiff, the defendant did not choose to make good the deficit. The defendant took a stand that the percentage of loss has increased due to the substandard packing of the products by the manufacturers and use of a particular kind of a lorry (Taurus) for transport of the IMFS and Beer, hence the defendant is not liable to make good the entire loss. However, the defendant did not choose to disclose the basis on which it had arrived at the quantum of loss at 30%.

2.5. According to the plaintiff, as per the Policy conditions for claims below Rs.5,000/- per GRA (Goods Receipt Acknowledgement), the defendant should