The principal is liable for the agent’s fraud within their authority, despite claims of misrepresentation.

1. The present Appeal has been filed against the Order dated 20.8.2007 passed by the State Consumer Disputes Redressal Commission, Rajasthan at Jaipur (hereinafter to be referred to as State Commission) in Complaint No. 9 of 2006, whereby the Complaint filed by the Complainant was partly allowed and Respondent, Iffco Tokio General Insurance Company Ltd. (hereinafter referred to as the the Insurance Company) was directed to pay to the Complainant a sum of Rs. 17,69,260 to wards loss suffered by it due to damage to the furniture stocks lying at its go down at Bhiwandi, along with interest @ 9% p.a. from the date of repudiation of claim, i.e. 30.3.2006 till realization.

2. Brief facts of the case as narrated in the Complaint are that the Complainant, a proprietorship concern, which is dealing in the business of imported office furniture and having its Head Office at Jaipur and offices - cum - go downs at different parts of the country, obtained an Insurance Policy, namely, Trade Protector Policy from the Appellant Insurance Company through Opposite Party No. 3, its Respondent No. 2 herein for a sum of Rs. 75,00,000 for the period from 25.7.2005 to 24.7.2006 covering the risk to its stock of imported furniture lying at the following locations:
(i) H - 181, Malviya Nagar Industrial Area, Jaipur;
(ii) 843/1, Ghitorni Mehrauli - Gurgaon Road, New Delhi;
(iii) 17, 4th Block, 80 Ft. Road, Koramangala, Bangalore;
(iv) 3 Town Centre, Saki Naka, Andheri Kurla Road, Andheri East Mumbai - 59; and
(v) Building No. 16, Licence Premises No. 3, Ground Floor, Shri Compound, Kooper Bhiwandi..

3. A sum of Rs. 34,641 as premium was paid by the Complainant to the Agent and immediately they issued a cover note to the Complainant along with proposal form and proposal sheet dated 23.7.2005. In pursuance to the said Cover Note, an Insurance Policy dated 1.8.2005 for Rs. 75,00,000 was issued by the Insurance Company in favour of Complainant for the aforesaid period covering all the five locations.

4. Unfortunately, on 26.7.2005 at about 10-11 a.m. there was unpredicted heavy rain about 944 mm continuously for more than 18-24 hours in Mumbai and nearby areas as a result of which the go down situated at Building No. 16, License Premises No. 3, Ground Floor, Shri Compound, Kooper Bhiwandi was fully drowned in flood / water inundation. The entire furniture stocks lying in the said go down was badly damaged due to slush and dirt on being remained in the water log for 12 to 15 hours. Upon intimation, the Insurance Company appointed a Surveyor and loss Assessors, namely, M/s. Parimal R. Shah & Company, Mumbai to assess the loss. All the documents along with colour photo prints as demanded by the Surveyor, were supplied and a claim of Rs. 31,91,704 (Rs. 25,27,514 at go down of Bhiwandi + Rs. 6,64,190 at showroom at Mumbai) was submitted by the Complainant. The Surveyor submitted its final report on 7.1.2006 assessing the net loss to the tune of Rs. 17,69,260 as under:

5. However, the Insurance Company, vide its letter dated 30.3.2006, repudiated the claimas under:
With reference to your captioned claim, we wish to inform you that the insurance policy which was granted to you for the period 25th July, 2005 to 24th July, 2006 as a renewal of the earlier policy of Bajaj Allianz for the period 25th July, 2004 to 24th July, 2005 provided coverage for property stored at only 4 locations at Jaipur, Mumbai, Bangalore and Delhi.
The alleged damages suffered by you were in respect of property located at Building No. 16, Premises No. 3, Ground Floor, Shree Arihant Compound, Vill. Kooper, Bhiwandi, which was not insured under the aforesaid policy on the date of loss. Accordingly, we regret to state th