Judgement

HIDAYATULLAH, J. : This appeal is taken from a judgment of the High Court of Calcutta, July 13 and 14, 1961, by which a Divisional Bench of the High Court, reversing the judgment of the learned Single Judge of the same Court, decreed the respondents claim for damages. The circumstances were these. The appellant is a general insurance company. On June 2, 1950 the respondents submitted proposals to the Company with a view to insuring certain houses in Dhulian bearing Holding Nos. 274, 274/A-B-C and D and 273, 273/A-B-C and D, for Rs. 51,000 and Rs. 65,000 respectively against fire and including loss or, damage by cyclone, flood and/or change of course of river or erosion of river, land-slides and subsidence. The town of Dhulian is situated on the banks of the Ganges and for several years the river had been changing its course and in 1949 a part of the town was washed away. The insurance was obviously effected with this risk in sight. The period of insurance was to be from June 3, 1950 to June 2, 1951. The Company accepted the proposals by two letters (Ex. D) on June 3, 1950 and the letters stated that in accordance with the proposals the assured was held covered under cover notes enclosed with the letters. At the back of these letters of acceptance, there was description of the houses and an endorsement which read :

"Including Cyclone, Flood and/or loss by change of course of river, diluvium and/or Erosion of River, Landslide and/or subsidence. It is further noted that there is a thatched building of residence within 50 ft. of the above premises."

Two interim protection cover notes Nos. 18848 and 18850 in respect of the two proposals were filed by the Insurance Company along with the written statement and they were said to be copies of cover notes sent with the letters of acceptance, but they bore the date June 5, 1950. There is some dispute as to whether they were at all enclosed with the reply showing acceptance of the proposals. Of the two convernotes, which are identical except for details we may read one only :

"Messrs. Chandmull Lal Chand, P. O. Dhulian Murshidabad being desirous to effect an Insurance from loss by Fire, for Rs. 51,000 on the following property viz. -

One Pucca built and roofed building (C. J. Vizandah) holding Nos. 274, 274-A, 274-B and 274-C occpd. as residence and/or shop for the storage of hydrogenated G. nut oil (vanaspati) and safety matches also situated at Dhulian Ward No. IV, District Murshidabad.

Incl. Loss or damage by cyclone, flood and/or change of course of river and/or Erosion of river, landslides and/or subsidence.

It is further noted that there is a thatched building of residence within 50 ft. of the above premises.

for one year from 3rd June, 1950 to 3rd June, 1951.

The said property is hereby held insured against damage by Fire, subject to the terms of the Applicant s proposal and the usual Condition of the Society s policies. It is, however, expressly stipulated that this protection Note cannot, under any circumstances be applicable for a longer period than Thirty Days, and that it is also immediately terminated before that date by delivery of the policy, or if the Risk be declined by the notification of such declinature.

Prem : Rs. 892-8-0 Fire at the rate of 28 as per cent.

Prem : Rs. 382-8-0 flood and other risks at the rate of 12 as per cent.

Premium : Rs. 1275-0-0."

On June 7, the assured sent the premia by cheque. As no policy was received by them, the assured wrote a letter on July 1 (Ex. A/g) asking for the policy or for extension of the cover notes. This was not done.

(2) On July 6, 1950 the Company wrote to the assured two identically worded letters (except for changes in amounts and numbers of the policies) which read :

Calcutta 6th July, 1950

.............. ..............

To,

M/s. Chandmull Lal Chand,

P. O. Dhulian,

Murshidabad.

Dear Sir,

............ ..............

............ ..............

In accordance with the inspection report lodged with this Co. we cancel the risk from 6th July,