Delhi District Court
Dharampal Transport vs National Insurance Co Ltd on 16 March, 2026
IN THE COURT OF SHRI DEVENDER KUMAR, DISTRICT JUDGE
(COMMERCIAL COURT-01), EAST DISTRICT
KARKARDOOMA COURTS : DELHI
CS (Comm.) No. 84/2025
Sudhir Kumar Varma
Prop. of M/s Dharampal Transport
S/o Late Sh. Dharmpal Verma
Shop No. 7, Palika Kunj Market,
Karbala Lane, Near Jor Bagh Metro ST.
New Delhi - 110003 ...... Plaintiff
Vs.
National Insurance Co. Ltd.
Scope Minar, Core -3, 2nd Floor,
Laxmi Nagar, Delhi -110092
Also at :-
Branch 381, Kamla Bhawan
Delhi Road Near Madhusudan School,
Rewari, Haryana -123401 ...... Defendant
Date of Institution : 20.03.2025
Date of Arguments: 11.03.2026
Date of Judgment : 16.03.2026
JUDGMENT:
1. Vide this judgment I shall dispose of this suit for recovery of Rs. 80,00,000/- along with interest @ 18% per annum filed by the plaintiff against the defendant. Brief facts of the case are as under:
Digitally signed by DEVENDRACS (Comm) No. 84/2025 KUMAR
Dharampal Transport Vs. National Insurance Co. Ltd. DEVENDRA 1/32
Date:
KUMAR 2026.03.16
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2. Plaintiff is running a proprietorship firm in the name and style of M/s Dharampal Transport and engaged in the business of providing transport services. It is further alleged that the plaintiff purchased a Goods Carrier vehicle / machine i.e. transit concrete Boom Pump mounted Putzmeister M36-4, vide Registration No. HR-55V-3680 from erstwhile Devender Pal Singh Bhatia in the year 2022. It is further alleged that the plaintiff got inspected vehicle from valuer Mr. V. K. Jaidka, who assessed the value of vehicle for Rs. 90 Lacs vide valuation report dated 27.07.2022. It is further alleged that the defendant is an insurance company and the plaintiff got insured his vehicle from the defendant company vide policy No. 361402312310000752 dated 25.07.2023 valid for the period from 28.07.2023 to 27.07.2024 and paid premium of Rs. 89,637/- (Rs.78,198/- premium + GST of Rs. 11,439/-).
2.1. Plaintiff has further alleged that on 18.12.2023, at about 12.30/ 1.00 AM, his driver Vipin Kumar was driving the vehicle from Bhati Kalan, Chattarpur to Village Kharkhoda, Haryana and forgot the way and parked his vehicle on road side to enquire about route but said vehicle was stolen by someone from Rani Bagh Main Road, Near Pani Ki Tanki, opposite Ramda Hotel, Delhi. It is further alleged that the driver Vipin Kumar searched the vehicle thoroughly and informed PCR on 112 and the police visited the spot and lodged GD No. 0004A dated 18.12.2023. It is further alleged that the police of PS Rani Bagh lodged e-FIR No. 39100 dated 18.12.2023 regarding the theft of the vehicle.
Digitally
signed by
DEVENDRA
DEVENDRA KUMAR
CS (Comm) No. 84/2025 KUMAR Date:
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2026.03.16
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2.2. Plaintiff has further alleged that the plaintiff also informed the customer care of the defendant company about theft of the vehicle on 18.12.2023 at 3.23 pm through email. It is further alleged that the plaintiff completed all legal and procedural formalities and lodged insurance claim of the vehicle and the defendant company appointed surveyor / investigator Mr. Ajay Bajaj from Aay Bee Associates & Consultants to verify the claim and also intimated the plaintiff vide email dated 10.01.2024. It is further alleged that the surveyor inspected the spot on 15.01.2024 in the presence of the plaintiff and raised queries about the incident and the plaintiff provided all assistance to the surveyor including visit to the police station. Even the police also filed untrace report in FIR after investigation and Ld. MM has accepted said report on 01.02.2024. It is further alleged that the defendant sent an e-mail dated 06.02.2024 to the plaintiff being less concerned to the investigation of theft of the vehicle, which was also duly replied and also provided both the keys of the vehicle on 13.06.2024 and were duly received by the defendant against letter dated 13.06.2024.
2.3. Plaintiff has further alleged that the defendant company failed to consider the insurance claim of the plaintiff, due to the plaintiff served a legal notice dated 30.08.2024 and the defendant again raised another quarry in response of legal notice through email on 08.11.2024 and thereafter failed to respondent, due to the plaintiff filed this suit to recover insured amount of Rs. 80,00,000/- along with interest @ 18% per annum.
3. Defendant has filed WS thereby denying all the allegations of the plaintiff and has alleged that the insurance claim of the plaintiff has been Digitally signed by DEVENDRA CS (Comm) No. 84/2025 DEVENDRA KUMAR Dharampal Transport Vs. National Insurance Co. Ltd. KUMAR Date: 3/32 2026.03.16 16:23:54 +0530 repudiated vide repudiation letter dated 30.09.2025 for breach of terms and condition of the insurance policy. It is further alleged that the alleged the incident of theft took place due to negligence of the plaintiff and the plaintiff has concealed the material facts to lodge this claim. It is further alleged that the defendant demanded specific clarification from the plaintiff regarding invoices of power-boom fitted on stolen vehicle along with insurance policy of the vehicle on which the said power boom was fitted earlier but the plaintiff failed to provide. It is further alleged that the defendant also sought clarification about third party insurance policy which was converted into comprehensive policy and also to seek information why the policy and sale consideration were not endorsed in RC of the vehicle. It is further alleged that the vehicle was purchased by the plaintiff on 07.07.2022, whereas it was already in use since January, 2022 and a lot of discrepancies were found in the statements of driver Vipin Kumar, owner and AR Bhagat Singh to reject the claim of the plaintiff.
3.1. Defendant has further alleged that the claim of the plaintiff was rejected for the want of eye witness of the incident, negligence of the driver who left the vehicle unattended, lack of evidence and failure to provide crucial documents and CCTV footages to substantiate the vehicle's presence at the spot. It is further alleged that the driver left the vehicle unattended at a public place for 25 minutes in late night hours and thereafter failed to cooperate in the investigation and violated Condition 5 of policy that "the insured shall take all reasonable steps to safeguard the vehicle from loss or damage" and such omissions resulted into theft of the vehicle. It is further alleged that material contradictions were found in the Digitally signed CS (Comm) No. 84/2025 by DEVENDRA Dharampal Transport Vs. National Insurance Co. Ltd. KUMAR 4/32 DEVENDRA Date:
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statements of the driver as well as the plaintiff by investigator and even one key of the vehicle was found duplicate, but the plaintiff attempted to project it as original.
3.2. Defendant has further alleged that the vehicle was stolen on 18.12.2023 but the plaintiff has deposited motor vehicle tax on 16.01.2024 for the period from 01.01.2024 to 31.03.2024 which suggests that the vehicle was still in use, whereas the plaintiff has also failed to provide Fast- Tag details of the vehicle. It is further alleged that the contradictory statements of the owner and driver and potential breach of terms and condition of the policy by the plaintiff compelled the defendant to repudiate the insurance claim and the defendant is not liable to pay insurance amount. Defendant has denied all the allegations of the plaintiff and has prayed that this suit is liable to be dismissed.
4. Plaintiff has filed replication to written statement thereby denying all the allegations of the defendant and has reaffirmed his pleadings.
5. On the basis of pleadings of the parties the following issues were framed vide order dated 30.10.2025 as under:
ISSUES
1. Whether plaintiff is entitled for decree of amount of Rs.
80,00,000/- as prayed for? OPP.
2. Whether the plaintiff is entitled for interest against decretal amount as prayed, if so, at what rate and for what period? OPP
3. Relief Digitally signed by DEVENDRA CS (Comm) No. 84/2025 KUMAR Dharampal Transport Vs. National Insurance Co. Ltd. DEVENDRA 5/32 Date:
KUMAR 2026.03.16
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6. To prove the case, the plaintiff has examined PW1 Sudhir Kumar Verma, who has deposed in verbatim of plaint and has relied upon documents Ex.PW1/1 to Ex. PW1/28.
6.1. During cross examination, PW1 has deposed that he purchased a second-hand vehicle bearing No. HR-55V-3680 from Narayana Vihar for construction business but did not remember its value. It is further deposed that he purchased 'boom pump' and the vehicle separately but did not remember the date of purchase of boom pump but said boom pump was already installed in his previous vehicle and was got replaced in insured vehicle. It is admitted that he has not filed any document relating to purchase of insured vehicle as well as boom-pump installed thereon. It is further deposed that he asked the insurance company to get the vehicle No. HR-55V-3680 insured and the company sent its surveyor to get it valued and issued insurance policy.
6.1.1. PW1 has further deposed that he never availed loan against insured vehicle and did not get assessed its value or depreciation in tax. It is further deposed that the driver, who was driving the vehicle, was employed for the last two and a half year approx. prior to this theft of the vehicle. It is further deposed that the vehicle was sent for service before the incident but service center was closed, due to the vehicle could not be serviced. It is further deposed that the vehicle had fast-tag in the name of previous owner, due to he could not provide the details of fast-tag to the defendant.
6.1.2. PW1 has further deposed that on the day of incident, the vehicle was being driven from Bhaati Mines, Dera gaon to Kharkhoda, Sonipat Digitally signed by CS (Comm) No. 84/2025 DEVENDRA Dharampal Transport Vs. National Insurance Co. Ltd. DEVENDRA KUMAR 6/32 KUMAR Date:
2026.03.16 16:20:58 +0530 (HR) and the driver informed him about the incident of theft between 1:00 / 1:30 am on 18.12.2023. It is further deposed that he surrendered the keys of the vehicle to the defendant company as received from the previous owner of the vehicle. It is further deposed that he did not consult any advocate prior to lodging of this insurance claim of theft of insured vehicle. It is further deposed that he was aware about terms and conditions of the insurance policy mentioned in cover note and the defendant did not furnish other separate terms and conditions of the policy at the time of issuance of policy. It is further admitted that he has paid road tax of the vehicle for the period from 01.01.2024 to 31.03.2024, but it is denied that he fraudulently filed his insurance claim before the defendant company, or that the theft of his vehicle was pre-planned. It is denied that the vehicle was stolen due to negligence of his employee, or that he received repudiation letter issued by the defendant.
6.2. PW2 Vipin Kumar, the driver of the stolen vehicle has deposed that he had been working with the plaintiff for the last two and a half years and was driving insured vehicle for last one year. It is further deposed that there was no helper on the vehicle in the intervening night of 17/18.12. 2023. It is further deposed that the vehicle had no fast-tag and on 17.12.2023, he drove the vehicle from Bhati Mines (Dera Gaon), Delhi to Kharkhoda, Sonepat, Haryana and parked it on roadside at Rani Bagh, nearby Paani Ki Tanki, from where it got stolen at around 12.30 a.m. on 18.12.2023. It is further deposed that he intuitively knew that he was driving on a wrong route so he stopped his vehicle, off its ignition to verify the route and went backward to the directions of the vehicle around 70/80 meters but could not Digitally signed by DEVENDRA CS (Comm) No. 84/2025 KUMAR Dharampal Transport Vs. National Insurance Co. Ltd. DEVENDRA 7/32 Date:
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find anyone to provide exact direction of the route. It is further deposed that he tried to enquire from nearby people sleeping on the road pavement but nobody answered, so he locked the vehicle to confirm the route and the keys of the vehicle were with him. It is further deposed that he was not aware whether keys of the vehicle with him were not original. It is further deposed that he took round 20 minutes to come back to the spot and found the vehicle stolen and informed the police on 112 number at about 1.00 a.m. and also informed the plaintiff about the incident. It is further deposed that he cannot say whether CCTV camera was installed there or not, as there was low visibility due to fog.
6.2.1. PW2 has further deposed that the police reached the spot within 20- 30 minutes but the plaintiff did not visit the spot and the police interrogated him but did not take him to the spot during investigation, though his statement was recorded. It is further deposed that the surveyor of the defendant company also enquired him but it is denied that he voluntarily left the vehicle at the spot to get it stolen in connivance of the plaintiff and the plaintiff has lodged a false claim of insurance. It is further denied that he was negligent while driving and parking the vehicle due to vehicle got stolen.
7. Defendant has examined DW1 Bimla Upadhyay, who has deposed in verbatim of defense in WS and has relied upon documents Ex. DW1/1 to Ex. DW1/13, except documents Ex.DW1/1, Ex.DW1/3 and Ex.DW1/4, which were de-exhibited and read as Mark A to Mark C. Digitally signed by CS (Comm) No. 84/2025 DEVENDRA Dharampal Transport Vs. National Insurance Co. Ltd. DEVENDRA KUMAR 8/32 KUMAR Date:
2026.03.16 16:21:08 +0530 7.1. During cross examination, DW1 has deposed that she was one of the dealing officers of the plaintiff who scrutinized the claim of the plaintiff. It is denied that she has wrongly deposed in his affidavit that the driver of the vehicle left the vehicle unattended and unlocked for 25 minutes, or that the defendant company did not appoint any surveyor, or that there were no findings of the surveyor as mentioned in Para 5 of her affidavit. It is admitted that insurance claim has to be settled within 30 days after completion of all formalities and even the defendant company put the claim in process from the date of intimation itself. It is further admitted that the plaintiff intimated about theft of the vehicle on the same day i.e. on 18.12.2023 and the defendant first time sought clarification through e-mail dated 17.09.2024. It is denied that the defendant intentionally raised queries through e-mail dated 17.09.2024 just to justify delay on receipt of legal notice dated 30.08.2024.
7.1.1. DW1 has further admitted that initial insurance policy was third party policy and a comprehensive policy got issued on installation of boom pump in the month of July, 2022. It is denied that documents sought through e-mail after 17.09.2024 were duly submitted by the plaintiff. It is further deposed that invoice of boom pump was required by the defendant company to ascertain its value but it is admitted that the defendant got ascertained the valuation of the vehicle to get issued policy and even premium amount was also raised accordingly. It is denied that e-mails sent by the defendant company after 17.09.2024 were afterthought as the defendant company failed to finalize the claim of the plaintiff. It is admitted that the address of the defendant company mentioned in legal Digitally CS (Comm) No. 84/2025 signed by Dharampal Transport Vs. National Insurance Co. Ltd. DEVENDRA 9/32 DEVENDRA KUMAR KUMAR Date:
2026.03.16 16:21:13 +0530 notice dated 30.08.2024 Ex. PW1/24 is correct. It is denied that the queries/documents sought by the defendant company through e-mails dated 12.03.2025, 17.03,2025 and 19.03.2025 were already with the defendant company and had no relevance.
7.1.2. DW1 has admitted that the plaintiff lodged FIR Ex.PW1/15 regarding theft of the vehicle and untrace report was also filed but the defendant company was informed that the case was not closed by the police, however she did not remember when the company received the information regarding pendency of investigation of FIR. It is admitted that closure / untrace report was accepted in the month of February 2024, copy of which is Ex. PW1/22, but the defendant did not file any protest petition against acceptance of closure report and also did not try to verify CCTV footages from the police.
7.1.3. DW1 has further admitted that the claim of the plaintiff has been repudiated by the defendant during pendency of this case, whereas the defendant did not receive any new document after 17.09.2024 to repudiate this claim. It is denied that the claim has been repudiated intentionally on realizing that the case of the plaintiff was going to succeed. It further denied that there was no negligence or violation on the part of the plaintiff or that the plaintiff fully cooperated in investigation and also complied with all conditions of the defendant company.
7.2. DW2 Ajay Kumar Bajaj, penal surveyor of the defendant company conducted the survey and investigation of the stolen vehicles. It is deposed Digitally signed by CS (Comm) No. 84/2025 DEVENDRA Dharampal Transport Vs. National Insurance Co. Ltd. DEVENDRA KUMAR 10/32 KUMAR Date:
2026.03.16 16:21:17 +0530 that on 19.12.2023, he was assigned investigation / survey of the vehicle no. HR55B-3680, installed with concrete Boom pump and was stolen in the intervening night of 17/18.12.2023. It is further deposed that he visited the spot of incident wherefrom the vehicle was stolen, met owner of the vehicle, driver and authorized signatory and found many discrepancies in their statements and furnished his report to the defendant company with all discrepancies and his report is Ex. DW2/A (OSR).
7.2.1. During cross examination, DW2 has denied that he is not competent to conduct the investigation or that his report Ex. DW2/A was biased just to favour the defendant. It is further denied that the survey report did not contain any technical investigation regarding theft of the vehicle, or that he did not record statements of driver and owner, or that he could not comment upon the keys specifications as mentioned in his report Ex.
DW2/A. It is further denied that he was not technical expert to conduct investigation to prepare his report Ex.DW2/A or that his report is false.
8. I have heard the arguments and perused the records. However, before giving issue wise findings, it is necessary to ascertain due institution/contest of this suit as under:
8.1. Authority of Authorized Representatives to Institute / Defend Suit -
This suit has been instituted by the plaintiff which is a proprietorship firm and has filed this suit through its proprietor Sudhir Kumar Verma. However, the proprietorship firm is not a separate legal entity to institute a suit in its own name due to only proprietor may institute suit on behalf of Digitally CS (Comm) No. 84/2025 signed by Dharampal Transport Vs. National Insurance Co. Ltd. DEVENDRA 11/32 DEVENDRA KUMAR KUMAR Date:
2026.03.16 16:21:23 +0530 the proprietorship firm. Order XXX Rule 10 of CPC deals with entities which are not separate legal entities but doing business in its name. Order XXX Rule 10 of CPC is as under:
Order XXX, Rule 10. Suit against person carrying on business in name other than his own.--Any person carrying on business in a name or style other than his own name, or a Hindu undivided family carrying on business under any name, may be sued in such name or style as if it were a firm name, and, in so far as the nature of such case permits, all rules under this Order shall apply accordingly.
8.2. Order XXX Rule 10 of CPC came into interpretation in case titled Dogiparthi Venkata Satish v. Pilla Durga Prasad, 2025 SCC OnLine SC 1825 and relevant observations are as under:
4. We have heard learned Senior Counsel for the parties and perused the material on record. In our considered opinion, the Trial Court was right in rejecting the application under Order VII Rule 11 CPC. The High Court committed serious error in relying upon Order XXX Rule 10 CPC. The reasons for our conclusion as noted above are as follows:
4.1 A proprietorship concern is nothing, but a trade name given by an individual for carrying on his business. A proprietorship concern is not a juristic person. It cannot sue, however, in view of Order XXX Rule 10 CPC, it can be sued. In order to analyse the said provision, it would be appropriate to reproduce the same. It reads as follows:
"10. Suit against person carrying on business in name other than his own.-- Any person carrying on business in a name or style other than his own name, or a Hindu undivided family carrying on business under any name, may be sued in such name or style as if it were a firm name, and, in so far as the nature of such case permits, all rules under this Order shall apply accordingly."
4.2 The use of the word can in Order XXX Rule 10 CPC only indicates that proprietorship concern may be made a party. However, it does not necessarily mean that the proprietor itself if made a party would not be enough, inasmuch as, the proprietorship is to be defended by the proprietor only and not by anybody else. Once the proprietor has been impleaded as a party representing the proprietorship, no prejudice is caused to rather its interest is well Digitally CS (Comm) No. 84/2025 signed by DEVENDRA Dharampal Transport Vs. National Insurance Co. Ltd. KUMAR 12/32 DEVENDRA KUMAR Date:
2026.03.16 16:21:29 +0530 protected and taken care of by the only and only person, who owns the proprietorship. Order XXX Rule 10 CPC does not in any manner debar a suit being filed against the proprietor.
4.3 It is well settled by series of judgments that proprietorship concern cannot be equated either with a company or with a partnership firm. Order XXX deals with partnership basically, however, Rule 10 thereof refers to proprietorship. It makes very clear that proprietorship concern cannot sue but it can be sued. Whether proprietorship concern is sued in its name or through its proprietor representing the concerned is one of the same thing. The High Court seems to have taken completely hyper technical view not realising that there was no prejudice caused and the cause of action very much accrued against the proprietor as he alone had signed the lease deed on behalf of the proprietorship concern and there was no involvement of any second or third party, whose interest could be said to have been prejudicially affected. Once the interest of the proprietorship concern was taken care of by the proprietor having been impleaded nothing further remained.
8.3. Further, in case titled Ashok Transport Agency v. Awadhesh Kumar, (1998) 5 SCC 567, it has held that;
11.2. A partnership firm differs from a proprietary concern owned by an individual. A partnership is governed by the provisions of the Indian Partnership Act, 1932. Though a partnership is not a juristic person but Order XXX Rule 1 CPC enables the partners of a partnership firm to sue or to be sued in the name of the firm. A proprietary concern is only the business name in which the proprietor of the business carries on the business. A suit by or against a proprietary concern is by or against the proprietor of the business. In the event of the death of the proprietor of a proprietary concern, it is the legal representatives of the proprietor who alone can sue or be sued in respect of the dealings of the proprietary business. The provisions of Rule 10 of Order XXX which make applicable the provisions of Order XXX to a proprietary concern, enable the proprietor of a proprietary business to be sued in the business names of his proprietary concern. The real party who is being sued is the proprietor of the said business. The said provision does not have the effect of converting the proprietary business into a partnership firm. The provisions of Rule 4 of Order XXX have no application to such a suit as by virtue of Order XXX Rule 10 the other provisions of Order XXX are applicable to a suit against the proprietor of proprietary business "insofar as the nature of such case permits". This means that Digitally signed CS (Comm) No. 84/2025 by DEVENDRA Dharampal Transport Vs. National Insurance Co. Ltd. KUMAR 13/32 DEVENDRA Date:
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only those provisions of Order XXX can be made applicable to proprietary concern which can be so made applicable keeping in view the nature of the case.
8.4. Further, in case titled Anil Bearings v. State Motors, 2010 SCC OnLine Del 747, it has further held that;
16. No doubt, the settled legal position is that since a firm is not a legal entity, the privilege of suing in the name of a firm is available only to those persons who are partners in a firm and are doing business as such. The present was, therefore, a case where the description of the plaintiff by a firm name was a mis-description, but such error in law, not being the description of a non-existent person, is not one which cannot be corrected. The learned trial court ought, therefore, to have directed the plaintiff to amend the memo of parties to enable a proper description of the plaintiff and proceeded to determine the real question in issue between the parties.
8.5. After going through abovesaid cases, it stands proved that the plaintiff did not require any specific authority to maintain this suit and it is sufficient to maintain this suit, if the proprietor has filed this suit in his name or firm through its proprietor. As such, this suit is maintainable on behalf of the plaintiff.
8.6. So far as authorization to AR on behalf of the defendant to contest this case is concerned, the defendant is a corporation / company and has filed its written statement through its Assistant Manager, whereas her power of attorney/ authorization is not on record. Admittedly, a civil suit by a corporation / company must be singed and verified by the authorized representative in terms of Order 29 Rule 1 of CPC, whereas appointment of recognized representative must be in terms of Order 3 Rule 2 of CPC. Order 29 Rule 1 of CPC is as under:
Digitally signed by DEVENDRA CS (Comm) No. 84/2025 DEVENDRA KUMAR Dharampal Transport Vs. National Insurance Co. Ltd. KUMAR Date: 14/32 2026.03.16 16:23:38 +0530 Order 29 Rule 1. Subscription and verification of pleading.-- In suit by or against a corporation, any pleading may be signed and verified on behalf of the corporation by the secretary or by any director or other principal officer of the corporation who is able to depose to the facts of the case.
8.7. In view of Order XXIX Rule 1 of CPC, it is clear that the authorities mentioned in abovesaid provision must sign and verify pleading like the secretary, director or any other principal officer of the corporation/ company. Authorities may sign and verify pleadings besides an authorized representatives appointed by the corporation through board resolution. The authority of the recognized agent/s has been prescribed under Order III Rule 1 & 2 of CPC as under:
Rule 1. Appearances, etc., may be in person, by recognized agent or by pleader.--Any appearance, application or act in or to any Court, required or authorized by law to be made or done by a party in such Court, may, except where otherwise expressly provided by any law for the time being in force, be made or done by the party in person, or by his recognized agent, or by a pleader [appearing, applying or acting, as the case may be, on his behalf :
Provided that any such appearance shall, if the Court so directs, be made by the party in person.
Rule 2. Recognised agents.--The recognised agents of parties by whom such appearances, applications and acts may be made or done are--
(a) persons holding powers-of-attorney, authorising them to make and do such appearances, applications and acts on behalf of such parties;
(b) persons carrying on trade or business for and in the names of parties not resident within the local limits of the jurisdiction of the Court within which limits the appearance, application or act is made or done, in matters connected with such trade or business only, where no other agent is expressly authorised to make and do such appearances, applications and acts.
Digitally signed by CS (Comm) No. 84/2025 DEVENDRA Dharampal Transport Vs. National Insurance Co. Ltd. DEVENDRA KUMAR 15/32 KUMAR Date:
2026.03.16 16:21:44 +0530 8.8. In view of abovesaid legal proposition, it stands proved that any recognized representative may be authorized through power of attorney / resolution of board of directors in terms of Section 291 of the Companies Act, 1956 (Now corresponding Section 179 of the Companies Act, 2013).
The authority of an authorized representative under Order III Rule 2 CPC viz-a-viz signing authority of authorized representative under Order XXIX Rule 1 & 2 of CPC has been defined in case titled Nibro Ltd. v. National Insurance Co. Ltd., (1991) 70 Comp Cas 388 (Delhi) as under:
Order 3, rule 1 provides that any appearance, application or act in or to any court required or authorise by law can be made or done by the party in person or by his recognized agent or by a pleader appearing, applying or acting, as the case may be, on his behalf. Provided of course, such an appearance, application or act in or to any court is required or authorised by law to be done or done by a party in such court. Where, however, there is an express provision of law, then that provision will prevail. Thus, if an authority is given to a pleader or a recognised agent as provided by law, the recognised agent or pleader can file an appearance or file a suit in court if the party himself is not in a position to file it. In my view, if a party is a company or a corporation, the recognised agent or a pleader has to be authorise by law to file such a plaint. Such an authority can be given to a pleader or an agent in the case of a company by a person specifically authorised in this behalf. In other words, a pleader or an agent can be authorised to file a suit on behalf of a company only by an authorised representative of the company. If a director or a secretary is authorised by law, then he can certainly give the authority to another person as provided under Order 3, rule 1.
The authority of a principal officer of a company in relation to suits filed on behalf of the limited company does not extend beyond what is laid down in Order 29 of the Code of Civil Procedure. That provision does not entitle the principal officer of a company to file a suit on its behalf and for that the authority has to be found either in the articles of association of the company or in the resolution of its board of directors. In the articles of association of several companies, provision is generally made authorising their managing directors and other officers to file and defend suits on their behalf. Similarly, the board of directors of a company can authorise the institution of a suit on behalf of the company by a resolution. In the case of some companies the Digitally signed by DEVENDRA CS (Comm) No. 84/2025 Dharampal Transport Vs. National Insurance Co. Ltd. DEVENDRA KUMAR 16/32 KUMAR Date:
2026.03.16 16:21:54 +0530 articles empower the managing director or directors to appoint general attorneys and general managers and given them authority to institute suits on behalf of the company. But in the absence of any proof in regard to any such power having been conferred on Shri Ram Lal Choudhary, it is not possible to accept his statement that he was authorised to file the suit as the principal officer of the plaintiff hotel.
It is well-settled that under section 291 of the Companies Act except where express provision is made that the powers of a company in respect of a particular matter are to be exercised by the company in general meeting, in all other cases the board of directors are entitled to exercise all its powers. Individual directors have such powers only as are vested in them by the memorandum and articles. It is true that ordinarily the court will not unsuit a person on account of technicalities. However, the question of authority to institute a suit on behalf of a company is not a technical matter. It has far-reaching effects. It often affects the policy and finances of the company. Thus, unless a power to institute a suit is specifically conferred on a particular director, he has no authority to institute a suit on behalf of the company. Needless to say such a power can be conferred by the board of directors only by passing a resolution in that regard.
8.9. Further, in a landmark judgment titled United Bank of India v. Naresh Kumar, (1996) 6 SCC 660, it has held that;
9. In cases like the present where suits are instituted or defended on behalf of a public corporation, public interest should not be permitted to be defeated on a mere technicality. Procedural defects which do not go to the root of the matter should not be permitted to defeat a just cause. There is sufficient power in the courts, under the Code of Civil Procedure, to ensure that injustice is not done to any party who has a just case. As far as possible a substantive right should not be allowed to be defeated on account of a procedural irregularity which is curable.
10. It cannot be disputed that a company like the appellant can sue and be sued in its own name. Under Order 6 Rule 14 of the Code of Civil Procedure a pleading is required to be signed by the party and its pleader, if any. As a company is a juristic entity it is obvious that some person has to sign the pleadings on behalf of the company. Order 29 Rule 1 of the Code of Civil Procedure, therefore, provides that in a suit by or against a corporation the Secretary or any Director or other Principal Officer of the corporation who is able to depose to the facts of the case might sign and verify on behalf of the company. Reading Digitally signed CS (Comm) No. 84/2025 by DEVENDRA Dharampal Transport Vs. National Insurance Co. Ltd. KUMAR 17/32 DEVENDRA Date:
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Order 6 Rule 14 together with Order 29 Rule 1 of the Code of Civil Procedure it would appear that even in the absence of any formal letter of authority or power of attorney having been executed a person referred to in Rule 1 of Order 29 can, by virtue of the office which he holds, sign and verify the pleadings on behalf of the corporation. In addition thereto and dehors Order 29 Rule 1 of the Code of Civil Procedure, as a company is a juristic entity, it can duly authorise any person to sign the plaint or the written statement on its behalf and this would be regarded as sufficient compliance with the provisions of Order 6 Rule 14 of the Code of Civil Procedure. A person may be expressly authorised to sign the pleadings on behalf of the company, for example by the Board of Directors passing a resolution to that effect or by a power of attorney being executed in favour of any individual. In absence thereof and in cases where pleadings have been signed by one of its officers a corporation can ratify the said action of its officer in signing the pleadings. Such ratification can be express or implied. The court can, on the basis of the evidence on record, and after taking all the circumstances of the case, specially with regard to the conduct of the trial, come to the conclusion that the corporation had ratified the act of signing of the pleading by its officer.
13. The court had to be satisfied that Shri L.K. Rohatgi could sign the plaint on behalf of the appellant. The suit had been filed in the name of the appellant company; full amount of court fee had been paid by the appellant-Bank; documentary as well as oral evidence had been led on behalf of the appellant and the trial of the suit before the Sub-
Judge, Ambala, had continued for about two years. It is difficult, in these circumstances, even to presume that the suit had been filed and tried without the appellant having authorised the institution of the same. The only reasonable conclusion which we can come to is that Shri L.K. Rohatgi must have been authorised to sign the plaint and, in any case, it must be held that the appellant had ratified the action of Shri L.K. Rohatgi in signing the plaint and thereafter it continued with the suit.
8.10. A combined reading of abovesaid judgments made it clear that pleading must be signed by the authorities mentioned under Order XXIX Rule 1, or by authorized agent / representative. The authorization of such representative may be in terms of Order III Rule 2 of CPC, or by the company through resolution of board of directors in terms of Section 291 of Companies Act, 1956 (now corresponding Section 179 of the Companies Digitally signed CS (Comm) No. 84/2025 by DEVENDRA Dharampal Transport Vs. National Insurance Co. Ltd. KUMAR 18/32 DEVENDRA Date:
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Act, 2013). However, in this case, the written statement has been signed by Assistant Manager, Ms. Neha Kishore in the capacity of a power of attorney holder of the defendant, whereas her power of attorney is not on record. Defendant has examined DW1 on its behalf and has relied upon her own power of attorney as Mark A, whereas it was not of AR who filed written statement.
8.11. Ld. Counsel for plaintiff has argued that the defendant has not proved power of attorney/ authority of authorized representative Ms. Neha Kishore and power of attorney Mark A relied upon by DW1 is also not proved, as neither its original has been produced before the court nor any explanation has been tendered, as to why original of Mark-A was not produced, due to authority of Ms. Neha Kishore or DW1 could be proved. It is further argued that the defense of the defendant cannot be considered for the want of authorization of AR, Ms. Neha Kishore and the written statement filed by AR without authority is liable to be rejected. On the other hand, Ld. Counsel for defendant has argued that the defendant has already proved authorization of Assistant Manager, Ms. Neha Kishore to file the written statement and also to contest this case. It is further argued that DW1 has also proved her power of attorney Mark A, which has been duly executed in favour of every Assistant Manager/s of the defendant to contest any case, due to Mark A has also proved authority of Ms. Neha Kishore to file written statement on behalf of the defendant. It is further argued that the plaintiff has not cross examined DW1 to dispute this power of attorney Mark A, due to authority of AR to contest this case stands proved.
Digitally signedCS (Comm) No. 84/2025 by DEVENDRA
KUMAR
Dharampal Transport Vs. National Insurance Co. Ltd. DEVENDRA 19/32
Date:
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8.12. Admittedly, the defendant has relied upon a power of attorney Mark A but it is not specific power of attorney of Ms. Neha Kishore, who has filed written statement on behalf of the defendant. Rather, Mark A is power of attorney of DW1 Bimla Upadhyay, whereas she has not filed written statement on behalf of the defendant. Defendant has not examined Ms. Neha Kishore to prove her authority to file Written Statement and to defend this suit on behalf of the defendant. Even Identity Card of Ms. Neha Kishore as Assistant Manager is also not on record to prove that Ms. Neha Kapoor was really working as Assistant Manager of the defendant and was authorized to contest this case. As such, authorization of AR, Ms. Neha Kishore could not be proved in terms of Order 3 Rule 2 or Order 29 Rule 1 of CPC.
8.13. Admittedly, institution of any suit/ Written Statement must be specifically allowed by the company in favor of AR to institute such suit or to sign and file Written Statement. In case, suit is instituted without any authority by AR, then the company shall ratify institution retrospectively by specific board resolution of the company. However, in this case, no identity of AR/ Assistant Manager, Ms. Neha Kishore has been proved on record, due to written statement/ statement of truth / affidavit of admission / denial of documents filed by her on behalf of the defendant could not be considered and same are liable to be rejected.
9. Consequences of not filing of written statement, statement of truth and affidavit of admission / denial of documents through authorized AR:
Though the defendant company has filed written statement, yet it has been Digitally signed CS (Comm) No. 84/2025 by DEVENDRA Dharampal Transport Vs. National Insurance Co. Ltd. KUMAR 20/32 DEVENDRA Date:
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filed without authority of the company by AR. Admittedly, Ms. Neha Kishore has singed written statement, affidavit in support of written statement, statement of truth and affidavit of admission / denial of documents but she has not filed her power of attorney/ ID proof to support her authorization to sign all such documents. Order VI has been amended by Section 16 r/w Schedule, Clause 4(B)-Appendix-I of The Commercial Courts Act, 2015 and statement of truth as per Appendix-I has mandated to support such written statement by statement of truth and affidavit of admission / denial of document is also mandatory, whereas all such documents are without authority and consequently the claim of the plaintiff amounts to admitted or not rebutted. As such, defense of the defendant may not be considered and defense shall be considered to be struck off.
10. Whether Cross Examination of PWs and Testimonies of DWs May be Considered in the Absence Authorization of Defendant? - Admittedly, authorization of AR, who has filed written statement on behalf of the defendant, is not on record and cannot be relied upon by DWs to prove defense of the defendant or to conduct the cross examination of PWs. DW1 has relied upon power of attorney Mark A, which is also disputed by the plaintiff. No doubt, no authorization is required to depose if a witness has personal knowledge about the case and DW1 had dealt with claim of the plaintiff, due to non-production of original of Mark A was/ is not fatal to this case. However, the facts deposed by DW1 were part of written statement of the defendant filed without authority, due to testimony of DW1 is of no use except to consider any admission/s in favor of the plaintiff.
Digitally
signed by
CS (Comm) No. 84/2025 DEVENDRA
Dharampal Transport Vs. National Insurance Co. Ltd. DEVENDRA KUMAR 21/32
KUMAR Date:
2026.03.16
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11. Mr. Varun Dev Mishra, Advocate, who has conducted the cross examination of PWs was also engaged by Ms. Neha Kishore and if authority of Ms. Neha Kishore is not proved on record, then authority of Advocate engaged by her also gone and such cross examination of PWs is of no use.
12. After dealing with institution of suit / written statement, now facts of the case have to be considered and my findings on issue no.1 are as under:
ISSUE No. 1: - The onus to prove this issue was put upon the plaintiff and to discharge the onus, the plaintiff has examined PW1 Sudhir Kumar Verma and has also cross examined DWs. PW1 has proved that he purchased a second-hand vehicle bearing No. HR55V-3680 for construction business and also got fitted a boom pump on the vehicle separately. Plaintiff has proved ownership of the vehicle through Ex.PW1/3, Pollution Under Control Certificate Ex.PW1/4, Certificate of Fitness Ex.PW1/5, Tax Receipt Ex.PW1/6 and Permit/s of vehicle Ex.PW1/7 and Ex.PW/8. Plaintiff also got valuation of the vehicle through surveyor and report is Ex.PW1/10. It is further proved that he got insured the vehicle from the defendant company and the company's surveyor also inspected the vehicle, valued and insured it against insurance policy and tax invoice Ex.PW1/11 & Ex.PW1/12. It is further proved that the plaintiff never availed any loan against this vehicle but was not aware about its exact valuation. It is further proved that the driver / PW2 Vipin Kumar was employed with the plaintiff for the last two and half years and was driving the vehicle from Bhaati Mines, Dera Gaon to Kharkhoda, Sonipat (HR) and doubted about correct Digitally signed CS (Comm) No. 84/2025 by DEVENDRA Dharampal Transport Vs. National Insurance Co. Ltd. KUMAR 22/32 DEVENDRA Date:
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route, locked and parked the vehicle on roadside to inquire about correct route but someone stole the locked vehicle at about 1.00 / 1.30 am on 18.12.2023. PW2 has also corroborated this testimony of PW1 and has proved that he informed PW1 about the incident and also called the police on 112 and the police inspected the spot and lodged GD, which followed by FIR. License of driver is Ex.PW1/3, copies of GD and FIR are Ex.PW1/14 & Ex.PW1/15.
13. PW1 has further proved that he informed the defendant company through e-mails Ex.PW1/16 to Ex.PW1/18 about the incident of theft of the vehicle and lodged claim against this theft. PW1 has further proved that he furnished all documents and details along with both keys of insured vehicle as sought by the insurance company through letters Ex.PW1/19 & Ex.PW1/23. Various e-mails were exchanged between the parties Ex.PW1/20 (colly). Police have investigated the theft of vehicle and have filed untrace report before Ld. MM and the vehicle could not be traced out. Copy of order is Ex.PW1/22. As such, the plaintiff has proved that the plaintiff purchased a second-hand vehicle and got it insured from the defendant company and the vehicle was stolen and could not be traced out.
14. Admittedly, the defendant lodged the claim of theft of the vehicle immediately and DW1 has admitted that such claim was to be lodged within 30 days and was lodged accordingly. However, the defendant failed to consider the claim of the plaintiff and kept it pending for long, due to the plaintiff served a legal notice legal notice dated 30/08/2024 Ex.PW1/24, which was duly served upon the defendant, as admitted by DW1, but still Digitally signed by CS (Comm) No. 84/2025 DEVENDRA Dharampal Transport Vs. National Insurance Co. Ltd. DEVENDRA KUMAR 23/32 KUMAR Date:
2026.03.16 16:22:29 +0530 the claim was not considered or rejected, but was rejected only during pendency of this suit.
15. Ld. Counsel for defendant has argued that the plaintiff failed to provide both original keys of the vehicle and one of the keys handed over by the plaintiff was found duplicate, whereas the plaintiff has shown his ignorance about such duplicate key/s. However, the defendant has not led any expert evidence to prove such duplication of the key. It is not disputed that the plaintiff purchased a second-hand vehicle and the keys were handed over by erstwhile owner and same keys were handed over to the defendant by the plaintiff. Defendant was supposed to verify the keys before issuance of insurance policy, especially when the inspection and survey of the vehicle was also got conducted by the defendant before issuance of insurance policy. Defendant was supposed to prove a report of technical expert to prove that one of the keys was duplicate but no such report has been proved on record to prove this fact, due to objection taken by Ld. Counsel for defendant could not be proved.
16. Ld. Counsel for defendant has further argued that the surveyor report Ex.DW2/A has proved that the incident of theft had taken place on account of negligence of the driver and it was violation of Condition- 5 of the policy, due to the defendant is not liable to pay insurance claim. On the other hand, Ld. Counsel for plaintiff has opposed submissions and has argued that so called surveyor report of the surveyor was biased and prepared just to favour the defendant, due to such report is liable to be rejected.
Digitally
signed by
CS (Comm) No. 84/2025 DEVENDRA
Dharampal Transport Vs. National Insurance Co. Ltd. DEVENDRA KUMAR 24/32
KUMAR Date:
2026.03.16
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17. Admittedly, the defendant has repudiated the claim of the plaintiff citing negligence of the driver of the plaintiff, due to authenticity of such survey report has to be determined.
Authenticity of Survey Report Ex.DW2/A: Admittedly, the defendant has no defense on merit due to survey report ought to be rejected outrightly, but still its authenticity is being considered. Survey report has been relied upon by DW1 Bimla Upadhyay as Mark C and has been proved by DW2 Ajay Kumar Bajaj as Ex.DW2/A. Ld. Counsel for plaintiff has argued that there was/is no legal basis of such surveyor report, due to this report has to be rejected. However, before considering argument of Ld. Counsel for plaintiff, it is necessary to consider the law laid down by Hon'ble Apex Court in case titled New India Assurance Co. Ltd. v. Sri Buchiyyamma Rice Mill, (2020) 12 SCC 105 as under:
13. Section 64-UM(1) of the Insurance Act, 1938, speaks of licensing of the surveyors and loss assessors. In the present case, we are not concerned with sub-section (1). Sub-section (2) mandates that no claim in respect of a loss which has occurred in India and requiring to be paid in an amount equal to or exceeding Rs 20,000 in value on any policy of insurance shall be admitted for payment, unless the insurer obtains a report of a surveyor or loss assessor who holds a licence issued under sub-section (1) of Section 64-UM. Sub-section (3) empowers IRDA with the power to obtain an independent report from any other surveyor in respect of a claim of the nature referred to in sub-section (2). Sub-section (4) envisages that the regulatory authority may issue such directions as it may consider necessary on receipt of the report referred to in sub-section (3). The proviso to sub-section (2) reserves to the insurer, the right to pay or settle the claim for an amount different from the amount assessed by the surveyor or loss assessor.
15. In Sri Venkateswara Syndicate [Sri Venkateswara Syndicate v. Oriental Insurance Co. Ltd., (2009) 8 SCC 507, the issue before this Court was whether the insurer can appoint successive surveyors for getting the loss and damage assessed before settling the claim of the insured. The two-Judge Bench while explaining the purpose of a Digitally signed CS (Comm) No. 84/2025 by DEVENDRA Dharampal Transport Vs. National Insurance Co. Ltd. KUMAR 25/32 DEVENDRA Date:
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report of the surveyor observed thus:
"31. The assessment of loss, claim settlement and relevance of survey report depends on various factors. Whenever a loss is reported by the insured, a loss adjuster, popularly known as loss surveyor, is deputed who assesses the loss and issues report known as surveyor report which forms the basis for consideration or otherwise of the claim. Surveyors are appointed under the statutory provisions and they are the link between the insurer and the insured when the question of settlement of loss or damage arises. The report of the surveyor could become the basis for settlement of a claim by the insurer in respect of the loss suffered by the insured."
(emphasis supplied)
16. This Court in Sri Venkateswara Syndicate [Sri Venkateswara Syndicate v. Oriental Insurance Co. Ltd., (2009) 8 SCC 507 held that the report of a surveyor must be given due importance and that there should be sufficient grounds for explaining a disagreement with an assessment made by a report of the surveyor. Yet at the same time, under Section 64-UM(2) of the Insurance Act, 1938, it is not open to the insurer to merely appoint a succession of surveyors with a view to obtain a tailor-made report. It is open to the insurer to appoint another surveyor for valid reasons bearing on the deficiencies found in the survey report and the reasons which must be indicated by the insurer.
In this backdrop, the two-Judge Bench while holding that that there is no absolute prohibition on the insurer appointing more than one surveyor observed thus;
35. In our considered view, the Insurance Act only mandates that while settling a claim, assistance of a surveyor should be taken but it does not go further and say that the insurer would be bound by whatever the surveyor has assessed or quantified; if for any reason, the insurer is of the view that certain material facts ought to have been taken into consideration while framing a report by the surveyor and if it is not done, it can certainly depute another surveyor for the purpose of conducting a fresh survey to estimate the loss suffered by the insured."
(emphasis supplied) In view of abovesaid law, it stands proved that appointment of surveyor beyond the claim of Rs. 20,000/- is mandatory as well as statutory. However, scrutiny of survey report is not barred to ascertain its impartiality and authenticity.
Digitally
CS (Comm) No. 84/2025 signed by
DEVENDRA
Dharampal Transport Vs. National Insurance Co. Ltd. DEVENDRA KUMAR 26/32
KUMAR Date:
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18. Admittedly, DW1 has admitted during cross examination that she has no personal knowledge about this surveyor report, whereas DW2 has proved survey report Ex.DW2/A. DW2 has deposed that he found many discrepancies in the statements of owner, driver and handling person and furnished his report of rejection of the claim. However, no material discrepancy has emerged during cross examination of DW2 before this court.
19. Ld. Counsel for defendant has argued that the defendant has proved this report and theft of the vehicle was result of negligence of the driver, due to the plaintiff is not entitled to recover insurance claim. No doubt, the testimony of DW2 has no much discrepancy but the survey report has to be judged on the basis of the testimonies of PWs recorded before the court viz-a-viz statements of witnesses recorded during investigation to prepare survey report.
20. Admittedly, statement of PW2 Vipin Kumar was recorded by DW2 during survey, who deposed that he left the keys of the vehicle inside and went to inquire about 2.5 km back, whereas he has deposed before this court that he locked the doors of the vehicle when left the vehicle to confirm the route and the keys were with him. However, testimony of PW2 before this court has not pointed out any negligence on the part of the driver. Defendant was supposed to confront previous statement of PW2 during his cross examination to seek his explanation that his earlier statement was against the previous statement. Such confrontation of previous statement was very well relevant u/s 145 of Evidence Act (Now Digitally CS (Comm) No. 84/2025 signed by Dharampal Transport Vs. National Insurance Co. Ltd. DEVENDRA 27/32 DEVENDRA KUMAR KUMAR Date:
2026.03.16 16:23:00 +0530 148 of BSA) but the defendant preferred not to confront PW to his previous statement to dispute his veracity, due to deposition of PW2 recorded before the court shall have all preference. As such, the plaintiff has proved that the vehicle was stolen by some unknown when it was left parked on roadside and the defendant has failed to prove any negligence on the part of the driver of the plaintiff. The survey report prepared on the basis of statements of owner and driver has failed to dispute testimonies of PWs recorded before this court, accordingly survey report is not reliable to deny the claim of the plaintiff.
21. Ld. Counsel for defendant has further argued that the plaintiff deposited road tax of the stolen vehicle for the period from 01.01.2024 to 31.03.2024 which suggests that vehicle was not stolen and rather was being used. However, road tax was deposited in the year 2024 and PW1 has also admitted this fact but the defendant has not put any question to seek clarification of PW1, as to why he deposited road tax, if the vehicle was already stolen and in the absence of cross examination, it could not be proved that deposit of road tax was for malafide purpose only. It is quite possible that the claim of the plaintiff was not approved and road tax might have been deposited to overcome any possible objection of the defendant against the claim, otherwise it was responsibility of the defendant to collect evidence that the vehicle was being plied on road even after theft, which is not done and is not fatal to this case.
22. In fact, the plea of the defendant is also contradictory on another aspect also. Defendant has put contradictory suggestions to PW1, on the Digitally signed CS (Comm) No. 84/2025 by DEVENDRA Dharampal Transport Vs. National Insurance Co. Ltd. KUMAR 28/32 DEVENDRA Date:
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one hand, he was suggested that theft of the vehicle was pre-planned, on the other hand, he was also suggested that the vehicle was stolen due to negligence of the driver of the plaintiff. It is beyond explanation, if the vehicle was stolen in pre-planned manner, then how it got stolen due to negligence of PW2. As such, both versions are contradictory and cannot be accepted. As such, survey report has failed to inspire confidence and same is liable to be rejected, hence rejected.
23. In fact, PW2 Vipin Kumar, driver of the vehicle was driving the vehicle in the intervening night of 17/18th December, 2023 and parked the vehicle on roadside at about 12.30 am to confirm his location and someone had stolen the vehicle from the spot near Rani Bagh, Water Tank, Opposite Ramda Hotel, Delhi. He informed the police and the police conducted investigation and later on closed the case by filing an untraced report. No doubt the defendant has argued that untrace report was not accepted by the Ld. MM, but the defendant has proved any protest petition or document against acceptance of untrace report and this plea also could not be proved.
24. Ld. Counsel for defendant has also argued that the plaintiff has not proved any CCTV footage to prove this theft, whereas collection of CCTV footage was part of investigation by the police, or by independent surveyor, who prepared survey report, which is not done, due to the claim of the plaintiff cannot be rejected solely on this ground. PW2 has duly proved that he immediately informed the police about theft of the vehicle and the police lodged DD entry, which followed by e-FIR and was sufficient and rest was matter of investigation, which has failed to prove any hanky-
Digitally
CS (Comm) No. 84/2025 signed by
Dharampal Transport Vs. National Insurance Co. Ltd. DEVENDRA 29/32
DEVENDRA KUMAR
KUMAR Date:
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panky.
25. Admittedly, stolen vehicle was insured under commercial
comprehensive package policy Ex. PW1/11 and the policy was issued after due verification and survey of the vehicle and was insured against IDV value of Rs. 80 Lacs. Defendant accepted total premium amount of Rs. 89,637/- against this policy and the policy was effective for the period during 12.00 midnight on 28/07/2023 to midnight 27/07/2024, whereas this incident of theft of the vehicle had taken place on 18/12/2023 i.e. during the existence of insurance policy. As per policy, no depreciation was allowed within a period of 6 months and this incident had taken place within the period of 6 months of issuance of policy only, due to no depreciation/ deductions was/ is allowed.
26. Admittedly, the claim of the plaintiff was rejected vide repudiation letter Ex.DW1/12 but this document has been placed on record without permission of the court and such document cannot be accepted in view of Order XI Rule 1 (5) of CPC. However, this claim was rejected through this document, due to this court has considered this document to ascertain the reasons of repudiation of the claim, but the grounds citied in the letter for rejection of claim like, insured failed to provide proof of second hand purchase of the vehicle, invoice of installation of boom pump, documentary proof of existence of vehicle before theft, documentary proof of payment made by Shahpoorji Palan ji to contract the vehicle, non-filing of untraced / final report and documentary proof to support IDV of the stolen vehicle etc. However, such objections have no substance. In fact, the defendant is Digitally signed CS (Comm) No. 84/2025 by DEVENDRA Dharampal Transport Vs. National Insurance Co. Ltd. KUMAR 30/32 DEVENDRA Date:
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trying to shift its own responsibility upon the plaintiff despite investigation of the incident through its surveyor. It is beyond explanation, if the plaintiff sent so many emails and furnished all required documents, then why the defendant did not ask for such documents/ information within the period of claim and kept pending the claim for such a long time. The claim was to be decided within 30 days, as admitted DW1 but was rejected on 30.09.2025 against the incident dated 18.12.2023, which cannot be justified in any manner. In fact, no defence of the defendant could be proved.
27. Ld. Counsel for defendant has relied upon judgment titled United India Insurance Company ltd. Vs. Kantika Colour Lab, (2010) 3 SCR 204, whereas this judgment was dealing with damage to a machine during transit and two surveyors reports pointed out damage and damage was opined to be repairable with repairing cost of Rs. 5,76,730/-. However, facts of that case were different to this case. In another judgment titled Canara Bank Vs. United India Insurance Company & Ors., (2020) 3 SCC 455, it was held that non-disclosure of complete facts makes insurance contract void, which is not the case herein. Another judgment titled Kanwarjit Singh Kang Vs. ICICI Lombard General Insurance Co. Ltd. & Anr., SLP Civil No. 6518 of 2018 was dealing with a case where keys of the vehicle left in the vehicle and the vehicle was stolen, which was considered a negligence. However, in this case, PW2 has proved that the vehicle was locked. As such, all judgments are not applicable on the facts.
28. Keeping in view the facts and circumstances of the case, I am of the opinion that the plaintiff has discharged the onus to prove issue no.1 and Digitally signed CS (Comm) No. 84/2025 by DEVENDRA Dharampal Transport Vs. National Insurance Co. Ltd. KUMAR 31/32 DEVENDRA Date:
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this issue no.1 is decided in favour of the plaintiff and against the defendant.
29. ISSUE No.2 - So far as the rate of interest against claim amount is concerned, there was no agreement between the parties to pay interest against default in payment of the claim. However, the defendant has rejected the insurance claim of the plaintiff in arbitrary manner, due to the defendant shall be liable to pay interest @ 9% per annum from the date of rejection of the claim upto the date of realization of the suit amount. Plaintiff has discharged the onus to prove issue no. 2 and this issue is also decided in favour of the plaintiff and against the defendant.
30. Relief: Plaintiff has discharged the onus to prove both the issues and the defendant is liable to pay amount of Rs. 80,000,00/- (Eighty Lakhs) along with interest @ 9% per annum from the date of rejection of the claim upto date of realization of the amount. I hereby pass of a decree of suit amount along-with interest in favour of the plaintiff and against the defendant. Plaintiff shall also be entitled for the cost of the suit. Decree Sheet be prepared accordingly.
31. File be consigned to Record Room after necessary compliance.
Digitally signed by DEVENDRA KUMAR DEVENDRA Date: ANNOUNCED IN OPEN COURT KUMAR 2026.03.16 ON 16th day of March, 2026 16:23:24 +0530 (DEVENDER KUMAR) District Judge (Commercial Court-01) East District Karkardooma Courts, Delhi CS (Comm) No. 84/2025 Dharampal Transport Vs. National Insurance Co. Ltd. 32/32