Ajit Bharihoke, Presiding Member
This revision is directed against the order of the State Commission whereby the State Commission dismissed the appeal of the petitioner opposite party against the order of the District Forum allowing the complaint.
2. Briefly put the facts relevant for the disposal of this revision petition are that respondent no.1 complainant is running a tyre retreading shop in village Tatahar in Sarkaghat Tehsil District Mandi. He insured his plant and machinery as well as the stock with the petitioner appellant for the period 06.05.2008 to 05.05.2009. The plant, machinery and accessories were insured for Rs.5.00 lacs and stocks for Rs.6.00 lacs. According to the complainant, during the validity of the insurance policy, a fire broke out in one of the two godowns of the respondent complainant located about 30 meters away from his shop. In that fire, plant, machinery and stock worth Rs.13.00 lacs were destroyed. The respondent complainant lodged an insurance claim with the appellant but it was repudiated on the ground that insurance was in respect of the plant, machinery and stocks available in the shop and the stock or the machinery kept in a godown was not insured. Aggrieved of this repudiation, respondent complainant preferred a consumer complaint seeking a direction to the petitioner to pay the insurance money alongwith compensation and litigation expenses.
3. The appellant contested the complaint and took the above noted plea of repudiation of claim.
4. Learned District Forum on consideration of the record allowed the complaint with following directions:
œIn the light of above discussion, the complaint is allowed and the opposite party no.2 is directed to pay Rs.2,61,534/- to the complainant alongwith interest at the rate of 9% per annum from the date of institution of the complaint till realization. The opposite party no.2 is further directed to pay to the complainant Rs.10,000/- on account of compensation for harassment and Rs.3000/- as cost of complaint.?
5. Being aggrieved of the order of the District Forum, the petitioner preferred an appeal which was dismissed by the State Commission with following observations:
œThe place, where the shop of the respondent is situated, is a small village in a remote Tehsil of Mandi District. Therefore, it can legitimately be concluded that the work of retreading tyres should be moderate. If that is so, huge stock of retreading raw material cannot be supposed to be required to be kept in the shop at any given point of time. In any case, stock worth Rs. 6.00 lacs in the form of raw material for retreading tyres cannot be even kept in a shop, where plant and machinery for retreading is also installed. So it can reasonably be presumed that what was intended to be covered by the insurance policy by way of stock, was the entire raw material for retreadig tyres kept by the respondent in the shop and stored in the godowns, though in the policy it is stated that the property is situated at a shop at Thathar, Sarkaghat. In the peculiar facts and circumstances of this case, there should be no hitch in inferring that the words œstock in the shop? used in the policy also include the stock in the godowns which are not situated far off from the shop.
In view of the above stated position, appeal is dismissed?.
6. Shri Yogesh Malhotra, Advocate, learned counsel for the petitioner has contended that impugned orders of the foras below are not sustainable as the orders are against the facts and law and based upon the assumption and presumption. Expanding on the argument, learned counsel for the petitioner has drawn our attention to the copy of insurance policy wherein name of the insured is mentioned as HGB Gopalpur A/C SSI-1589 and address is given as œVinod Puri : Shop at Tathar PO Sarkaghat The Sarkaghat Distt : Mandi, Himachal Pradesh?. In the middle of this document, the risk is described as œTyre Retreading Machinery and stocks? and in the coloumn below, it is mentioned property is situated at : œShop at Tathak Sarkaghat “ 175001? and the sum insured of plant, machinery and accessories for Rs.5.00 lacs and stock of rubbers for retreading Rs.6.00 lacs. It is contended that from the above, it is clear that only the plant, machinery and accessories and the stock of rubber for retreading lying in the shop was insured. Counsel has argued that admittedly fire broke at the godown and stock and machinery lying at the godown which is at a distance of 30 meters from the shop was destroyed. Counsel has contended that since the property lying at the godown was not insured, insurance company was justified in repudiating the claim.
7. Counsel for the opposite party on the contrary has argued in support of the orders of the fora below.
8. We have considered the rival contentions and perused the record. On reading of the order of the District Forum as well as State Commission, it is clear that both the foras below have proceeded on the assumption that huge stock worth Rs.6.00 lacs in the form of raw material for retreading tyres cannot be kept in the shop alongwith plant and machinery required for retreading of tyres. So it can be reasonably presumed that plant and machinery and stock lying in the godown which is at short distance from the shop was intended to be covered by the insurance policy and on this premise, District Forum has allowed the complaint. On perusal of the copy of insurance contract which is placed on record, it is clear that plant, machinery and accessories as also the stock of rubbers for retreading situated at shop at Tathak Sarkaghat was insured. Admittedly, the insurance claim was filed in respect of the stock and material lying in the godown, which does not find mention as insured property in the policy document. Now the question arises whether the material lying in the godown was covered by the insurance policy. Honble Supreme Court while deciding Civil Appeal No. 2080 of 2002 titled as VikramGreentech (I) Ltd. and Anr. Vs. New India Assurance Co. Ltd. has looked into the issue as to how insurance contract must be construed. In the aforesaid judgment, Honble Supreme Court has observed thus:
œAn insurance contract, is a species of commercial transactions and must be construed like any other contract to its own terms and by itself. In a contract of insurance, there is requirement of uberimmafides i.e. good faith on the part of the insured. Except that, in other respects, there is no difference between a contract of insurance and any other contract. The four essentials of a contract of insurance are, (i) the definition of the risk, (ii) the duration of the risk, (iii) the premium and (iv) the amount of insurance. Since upon issuance of insurance policy, the insurer undertakes to indemnify the loss suffered by the insured on account of risks covered by the insurance policy, its terms have to be strictly construed to determine the extent of liability of the insurer. The endeavour of the court must always be to interpret the words in which the contract is expressed by the parties. The court while construing the terms of policy is not expected to venture into extra liberalism that may result in re-writing the contract or substituting the terms which were not intended by the parties. The insured cannot claim anything more than what is covered by the insurance policy. [General Assurance Society Ltd. Vs. Chandumull Jain and another, Oriental Insurance Co. Ltd. Vs. Sony Cheriyan and United India Insurance Co. Ltd. Vs. Harchand Rai Chandan Lal].
Document like proposal form is a commercial document and being an integral part of policy, reference to proposal form may not only be appropriate but rather essential. However, the surveyors report cannot be taken aid of nor can it furnish the basis for construction of a policy. Such outside aid for construction of insurance policy is impermissible.?
9. On reading of the above, it is clear that an insurance contract has to be construed like any other contract on the basis of its terms and conditions and outside aid for construction of insurance policy is impermissible.
10. Insurance Policy clearly shows that only the plant, machinery and stock lying in the shop was insured. Therefore, the petitioner was justified in repudiating the claim of the respondent in respect of the loss caused to the plant, machinery and stock lying in the godown due to fire. On reading of the order of the District Forum as well as the State Commission, we find that both the foras below, in violation of the above noted position of law laid down by the Supreme Court have expanded the scope of the insurance contract on the basis of presumption and assumption which is not permissible. Thus, in our view, both the foras below have exceeded their jurisdiction while allowing the insurance claim of the opposite party. As such, their orders cannot be sustained.
11. In view of the discussion above, we allow the revision petition, set aside the impugned orders of the foras below and dismiss the complaint with no order as to costs.