IN THE NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION AT NEW DELHI NC/CC/28/2010 M/s. Sri Shadi Lal Enterprises Ltd. … Complainant Versus National Insurance Co. Ltd. … Opposite Party BEFORE:

HON’BLE MR. JUSTICE A.P. SAHI, PRESIDENT HON’BLE MR. BHARATKUMAR PANDYA, MEMBER Appeared at the time of arguments:

For the Complainant : Mr. Sameer Nandwani, Advocate Ms. Sanya Arora, Advocate For the Opposite Party : Ms. Meenakshi Midha, Advocate Mr. Garv Singh, Advocate PRONOUNCED ON : _08^th September 2025

ORDER

JUSTICE A.P. SAHI, PRESIDENT

1. The complainant claimed insurance coverage under a Standard Fire and Special Perils Policy, the duration whereof was from 01.04.2008 to the midnight of 31.03.2009. The coverage was also with regard to the stocks stored in a molasses tank of the complainant’s unit of Upper Doab Sugar Mills, Shamli, District Muzaffarnagar, U.P. It is alleged by the complainant that on 27.04.2008 at about 9pm, the molasses tank no. 5 all of a sudden burst as a result whereof the molasses stored in the tank spilled in the open area and a major quantity also went down the drain. The claim for the loss made was of Rs. 1,69,22,886/- for the loss of stocks, Rs. 25,88,031/- for the repair of tank no. 5 and on the said amount, an interest of 15% was claimed bringing the grand total of the claim to Rs. 2,59,49,519/-. This claim was enquired into through a Surveyor, who submitted the report and the Opposite Party Insurance Company repudiated the claim on 04.08.2009 on the ground that the cause for the loss was failure of the plates of the tank due to shearing. The same was therefore neither accidental nor it was covered under the policy. It had occurred due to wear and tear and the weakening of a 27 year old tank. Aggrieved, the complaint has been filed alleging deficiency and apart from the claim already made an additional sum of Rs. 50 lakhs as compensation has been claimed thereby raising the relief of total damages to the tune of Rs.

3,09,49,519/-.

2. The Insurance Company has filed its reply opposing the claim on several grounds contending that the loss had occurred on account of improper upkeep of the tank that was 27 years old and its plate were worn out. Consequently, the same was unfit for use, yet the complainant continued to utilise the same and therefore the claim was rightly repudiated as the wear and tear is not covered under the policy.

3. It has been further pointed out that the report of the Surveyor categorically, while assessing the loss as well as assessing the cause of loss, has clearly found that the claim was not indemnifiable for detailed reasons given therein and hence, the claim deserves to be rejected. Rejoinder was filed followed by the evidence affidavits of both the parties that are on record.

4. Mr. Nandwani, learned counsel for the complainant urged that the claim was clearly covered as the tank burst because of the chemical reactions giving rise to a pressure that was build up inside the tank and its impact led to the bursting of the plates of the tank resulting in a huge loss. He has invited the attention of the Bench to the various documents and the communications that ensued between the complainant and the Insurance Company and has also relied on certain literature on the effect of storing and shipping of molasses and its consequences.

5. He has then pointed out to the expert opinion of M/s. Satyakiran Engineers Pvt. Ltd. and other material on record to contend that the Surveyor has given a contrary opinion bereft of the evidence on record and has stretched his report in an attempt to prove that there was a weakening of the plates that resulted in the failure thereof and consequently such a mechanical failure of mild steel plates resulted in the incident.

6. The submission is that the aforesaid report of the Surveyor, which has been repeated in the letter of repudiation, is a figment of imagination and contrary to the expert opinion that establishes that the tank was in perfect and a fit condition.