State Consumer Disputes Redressal Commission
Ibrahimbhai Rehmanbhai Upad (Through ... vs National Insurance Company Ltd. on 30 March, 2026
NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION
NEW DELHI
REVISION PETITION NO. NC/RP/2103/2015
(Against the Order dated 19th February 2015 in Appeal No. 1037/2009 of the State Consumer
Disputes Redressal Commission Gujarat)
IBRAHIMBHAI REHMANBHAI UPAD (THROUGH LRS.)
PRESENT ADDRESS - RESIDING AT: GHANCHIWADA, MODASA TALUKA: MODASA, ,
SABARKANTHA , GUJARAT ,
.......Petitioner(s)
Versus
NATIONAL INSURANCE COMPANY LTD.
PRESENT ADDRESS - BRANCH MANAGER SHRI, NATIONAL INSURANCE CO.LTD. AT
AAROGYANAGAR, NR. BUS STAND, FIRST FLOOR, HIMATNAGAR,TALUKA: HIMATNAGAR, ,
SABARKANTHA , GUJARAT ,
.......Respondent(s)
BEFORE:
HON'BLE MR. JUSTICE A. P. SAHI , PRESIDENT
HON'BLE MR. BHARATKUMAR PANDYA , MEMBER
FOR THE PETITIONER:
APPEARED AT THE TIME OF ARGUMENTS: FOR PETITIONER : MR. RYAN SINGH,
ADVOCATE
FOR THE RESPONDENT:
FOR RESPONDENT : MR. AMIT KUMAR SINGH, ADVOCATE MS. ROKOSIENO
MEYASE, ADVOCATE
DATED: 30/03/2026
ORDER
JUSTICE A. P. SAHI, PRESIDENT
1. The petitioner, since deceased, and now represented through the legal representatives had filed CC No. 43 of 2006 before the DCDRC, Himmat Nagar, District Sabarkantha, Gujarat questioning the correctness of the repudiation by the respondent Insurance Company of his claim vide letter dated 15.06.2004 in respect of the claim for losses suffered by him when the stock of his Tiptop showroom and tailoring was looted during riots on 13.10.2002. The shop was insured for burglary. A copy of the burglary and housebreaking policy has been filed by the complainant as directed by this Commission on 23.09.2015. The complaint was partly allowed by the DCDRC awarding a sum of Rs. 3,37,367/- with 6% interest with effect from 17.03.2006. Rs. 2,000/- for agony and Rs. 2,000/- as litigation costs.
2. The Insurance Company filed an appeal F.A. no. 1021/2009 praying for setting aside the order passed by the District Commission and the complainant also filed an appeal F.A. no. 1037/2009 praying for enhancement.
3. The State Commission came to the conclusion that the repudiation was valid as there was no risk of riot covered under the policy. It was also held that the complainant had given a consent for an additional premium for riots, but since there was no evidence of any payment of additional premium, therefore, the policy was only for burglary and housebreaking where such risks during riots were not indemnifiable as per the exclusion clause.
4. While recording findings, the State Commission held that any loss during riots under the burglary policy would stand excluded. The State Commission allowed the appeal filed by the Insurance Company and set aside the order of the District Commission. As a consequence thereof, the appeal filed by the complainant for enhancement was also dismissed vide orders dated 06.02.2015.
5. The complainant has now come up in this revision petition filed under Section 21(b) of the Consumer Protection Act, 1986 assailing the appellate orders referred to hereinabove.
6. The revision petition was admitted on 04.01.2016 and the delay in the filing of the revision petition was condoned on 06.03.2018. On 10.10.2018, it was informed that the original petitioner had passed away and therefore I.A. No. 18785/2018 was moved for substitution of the legal heirs that was allowed.
7. Parties had exchanged their submissions whereafter written arguments were also filed. The written arguments on behalf of the petitioner were filed on 05.08.2020 vide Diary No. 13041 and the written arguments on behalf of the respondent was filed on 11.08.2020 vide Diary No. 13340 that are on record.
8. The first round of arguments of final hearing were advanced by the learned counsel for the petitioner that stands recorded in the order dated 02.08.2024 and is extracted hereinunder:
Heard learned counsel for the Petitioner and the learned counsel for the Insurance Company. The Petitioner had taken a Fire and Burglary Policy and during the duration of the said policy, the shop of the complainant was looted amongst widespread riots as a result whereof, the loss was sought to be indemnified by a claim lodged by the complainant before the Insurance Company. The claim was denied on the ground that complainant's loss was on account of a risk, the peril whereof was not covered under the policy namely riots and secondly the quantum of claim as set up by the complainant was not supported by appropriate documents.
Aggrieved, the complainant filed his case before the District Commission and after assessing the evidence, complaint was partly allowed for a sum of Rs.3,37,367/-. The insurance company was accordingly directed to pay this amount together with 6% annual interest and on failure to do so, interest was enhanced to 9%. Additionally Rs.2000/- for mental agony and Rs.2000/- as litigation cost was also awarded. The insurance company appealed against the said order and the award made by the District Commission has been reversed by the State Commission on the ground that risk was not covered under the policy in as much as the proposal of the petitioner for covering the risk of riots had not been accepted. The State Commission further went on to hold that the bills produced by the Petitioner before the State Commission were suspicious and accordingly the quantum claimed and the amount awarded by the District Commission was not justified.
Aggrieved, the present petition has been filed.
Learned counsel while advancing his submissions urged that suspicion cannot take place of proof and, therefore, the bills being merely doubted or suspected by the State Commission cannot take away the impact of the evidence that was led by the petitioner and had been proved. In addition thereto, the District Commission has also recorded a finding that some of the bills could not be disputed by the insurance company. It is, therefore, urged that this finding of the State Commission is erroneous and being against the weight of evidence on record, suffers from perversity and hence deserves to be set aside.
However, on the issue of coverage of peril, learned counsel submits that the proposal form was duly filled up seeking coverage of riot risk as well and that the complainant had offered to pay the additional premium for the said coverage. Nonetheless, the insurance company did not inform the petitioner about not having included the said risk either at the time of issuance of policy or thereafter, which fact was discovered when the claim was repudiated.
Learned counsel for the Petitioner prays that he may be permitted an adjournment to enable him to assist the Commission on this issue pertaining to the offer and acceptance regarding the risk coverage of riots.
List the matter again on 11.12.2024.
9. The arguments were again advanced on 24.04.2025 that are recorded hereinunder:
Heard Mr. Ryan Singh, learned counsel for the petitioner.
The contentions were noted in the order passed on 02.08.2024, where-after today Mr. Ryan Singh has advanced his submissions pointing out towards Clause 4(a) of the Exclusions in the Burglary and House Breaking Policy that was taken by the petitioner to cover the risk as entailed therein. He submits that the Exclusion which has been made the basis for reversing the order of the District Commission by the State Commission would not be attracted on the facts of the present case, for which he relies on para-5 of the complaint and the reply given by the Insurance Company in para-13 to contend that the loss did occur during the riot, yet no destruction was caused to the shop, inasmuch as, it was neither burnt down nor destroyed nor the goods kept inside faced any destructions. To the contrary, according to the petitioner, the rioting mob looted the shop and carried away the goods, which was an independent act of robbery during the riot itself. The submission therefore is that this was a clear burglary covered under the policy and the goods had not been destroyed as an outcome of the riot.
The question is as to whether such a theft committed during any of the contingencies as referred to in the policy clause 4(a) has also to be viewed from the angle that if a burglary is committed in situation like an earthquake or a flood or a storm etc. can the loss suffered be also held to be indemnifiable. Learned counsel submits that even in such cases the goods, if not have faced destruction on account of these contingencies of a riot or a flood or an earthquake, and have been instead stolen or looted or burglary committed by miscreants taking undue advantage of the contingencies, then in that event the Exclusion clause will not apply, inasmuch as, the destruction of the goods is not due to the flood or the storm or the riot but is on account of the goods having been lifted deceitfully which is an act of offence, and has been looted, which has no concern with the destruction under any of the contingencies referred to above.
The submission appears to be that in a case of flood there is likelihood of the goods being drowned or submerged or in case of an earthquake the goods being subjected to mutilation or in the case of a storm the same being blown off and shattered or even in the case of a riot being burnt, destroyed or mutilated. It is in these contingencies that the loss would not be indemnifiable and would stand excluded as the destruction is directly or indirectly on account of the said contingencies.
The contention is that in the instant case there is no such destruction on account of the mob having burnt or destroyed the goods. Taking undue advantage of the rioting situation the goods have been stolen. It is quite possible that many onlookers might have joined the mob of rioters, not essentially for the common purpose of rioting, but for looting shops by taking undue advantage of this rioting situation. The submission therefore is that there is no loss on account of the rioting but the goods have been lost having been looted may or may not necessarily by the rioters but by miscreants who committed the loot instead of destroying them.
Mr. Ryan Singh, learned counsel for the petitioner, therefore submits that the State Commission has proceeded to erroneously construe the loss to be a destruction on account of the riot whereas the fact is that the goods were neither lost nor destroyed or any harm caused to them and to the contrary they were carried away by the looters. He therefore submits that the Exclusion clause does not in any way come to the aid of the Insurance Company and applying the same by the State Commission is an incorrect application and interpretation of the said clause.
Learned counsel for the Insurance Company Mr. Amit Kumar Singh however has vehemently opposed this contention and he suggests and argues that it was a direct and proximate outcome of the riots and genesis of the said incidence amounts to depriving the petitioner of his goods which in effect is causing destruction to him and consequently it is because of the riots that the goods were lost. Hence the Exclusion clause would clearly apply so as to deny the indemnification as claimed. He therefore submits that the State Commission was fully justified in reversing the order of the District Commission.
Nonetheless, this matter requires a deeper scrutiny and learned counsel for the parties may invoke the aid of authorities or such literature or any other material to substantiate their submissions and assist the Bench accordingly. Learned counsel are also request to also consult any other material, including Dictionaries or legal commentaries, on the issue for proceeding with the matter.
Let the case be now listed on 07.07.2025.
10. As noted above, the policy was filed by the petitioner and the Operative clause thereof along with the Exclusions is extracted hereinunder:
The Company hereby agrees subject to terms, conditions and exclusions herein contained or endorsed or otherwise expressed hereon to indemnify the Insured to the extent of intrinsic value of:
OPERATIVE CLAUSE
a) Any loss of or damage to property or any part there of whilst contained in the premises described in the Schedule hereto due to Burglary or House-breaking (theft following upon an actual forcible and violent entry of and/or exit from the premises) and Hold-up.
b) Damage caused to the premises to be made good by the Insured resulting from burglary and/or house breaking or any attempt there at any time during the period of insurance.
Provided always that the liability of the Company shall in no case exceed the sum insured stated against each item or Total Sum Insured stated in the Schedule.
EXCLUSIONS The company shall not be liable in respect of:
1. ....
2. ....
3. ....
4. a) Loss or damage directly or indirectly, proximately or remotely occasioned by or which arises out of or an connection with Riot and Strike, Civil Commotion, Terrorist activities, earthquake, flood, Storm, Volcanic eruption, Typhoon, Hurricane, Tornado, Cyclone or other convulsions of nature or atmospheric disturbances.
b) Loss or damage whether direct or indirect arising from war, warlike operations and of foreign enemy hostilities (whether war be declared or not). Civil war, revolution, insurrection, civil commotion, military or usurped power, seizure, capture, confiscation, arrests, restraints and detainment by Order of any governments or any other authority.
In any action, suit or other proceedings where the company alleges that by reason of the above Provisions any loss or damage is not covered by this Insurance, the burden of proving that such loss or damage is covered shall be upon the Insured.
11. The incident due to which the loss occurred is not disputed. The policy was in operation is also not disputed.
12. On 13.10.2002, a strike took place as an outcome of the Gujarat riots and the complainant's shop was ransacked and the goods were robbed. It is undisputed that the riotous mob in a crowd barged into the showroom of the complainant which was closed and the goods were looted.
13. The claim was made before the Insurance Company and a Surveyor was appointed. The Insurance Company raised queries about the authenticity of the bills that were doubted and finally on 15.06.2004 the claim was repudiated.
14. It is thereafter that the complaint was filed and after assessing the evidence on record as also the accounts and the bills submitted by the complainant, an amount of Rs. 3,37,367/- was awarded with interest.
15. The appeal of the Insurance Company was allowed holding that the claim was not indemnifiable and also certain other facts on which findings were recorded. The order of the District Commission was reversed and the appeal filed by the petitioner for enhancement was dismissed.
16. The complainant petitioner has come up in this revision petition urging that burglary is established and it was committed by forcible and violent methods during the disturbance on 13.10.2002. Learned counsel therefore submitted that the incident of burglary is predominant and established, hence the exclusion clause would not apply. As noted above, the arguments had been advanced in different perspectives on the previous occasions and were once again pressed into service on 24.03.2026 when orders were reserved.
17. Mr. Ryan Singh on behalf of the petitioner complainant cited the judgment of the Delhi High Court in the case of Usha International Ltd. vs. United India Insurance Co. Ltd., 2005 (84) DRJ (Delhi Reported Judgments) page 6. On the strength of the said decision and on the facts of the present case, Mr. Singh urged that the intent and purpose of the policy is clearly to protect the insured and indemnify him in the event of losses if a burglary took place. He submits that the burglary could have taken place otherwise also and therefore the loss was indemnifiable, but in the instant case there was no doubt that there was a forcible and violent entry in the premises by the crowd, who robbed the goods and therefore this clearly fell within the Operative clause (a) hereinabove read with (b). The contention is that the event squarely falls within the definition of burglary which is a crime of breaking into a premises with an intent to commit felony by day or by night. It is urged that once the incident of burglary is not disputed then in that event the exclusion clause cannot be pressed into service.
18. On the other hand, learned counsel for the Insurance Company Mr. Amit Kumar Singh urged that the event which dominated the scene was a riot which was also coupled with robbery as alleged, but the main incident was the riot. The goods that were robbed during the riot by the crowd was an incident arising out of the riot itself and therefor the exclusion clause quoted above is clearly attracted. The District Commission had erroneously allowed the complaint which the State Commission has set right by reversing it. He further submits that there was no additional premium paid for riots and therefore the contract of insurance in respect of burglary stood concluded which cannot be altered as no such counter proposal had been accepted. Reliance has been placed on the decision of the Apex Court in the case of Deokar Exports vs. New India Insurance Co., (2008) 14 SCC 598, paragraph 13.
19. Mr. Singh submits that since there was no coverage for riots therefore the claim is not indemnifiable. He then submits that the burglary policy clauses are clearly explicit and admit of no ambiguity. The same being binding between the parties the claim was rightly repudiated. Mr. Singh therefore submits that the claim is unsustainable and therefore the order of the State Commission does not call for any interference. Mr. Singh has relied on a decision by the Court of Appeal, Royal Courts of Justice, United Kingdom in the case of The University of Exeter vs. Allianz Insurance PLC, decided on 07.11.2023, (2023) EWCA Civ 1484 to contend that the exclusion clause in the present case is attracted, in as much as, the proximate cause of the burglary was riots and even if the burglary was the concurrent cause, according to the aforesaid judgment the loss was caused on account of the riots which was the predominant event. He therefore submits that apart from the clear terms of the policy, the ratio of the aforesaid decision also comes to the aid of the Insurance Company.
20. Having considered the submissions and having perused the decisions relied on by the learned counsel at the Bar, the operative part of the policy covers loss or damage due to burglary or housebreaking that has been explained through a parasynthesis (meaning theft following upon an actual forcible and violent entry of an / or exit from the premises and hold-up). Apart from this, the damage caused to the premises is also covered under the operative clause. The policy cover note which is on record gives the description of the coverage which includes plant machinery and accessories, furniture fixtures and fittings, other stocks - tailoring materials and stock and stock-in process. It is therefore evident that any loss due to burglary of the property described was indemnifiable. The fact that the incident occurred on 13.10.2002 has been confirmed in the Surveyors report. The said loot and robbery committed by a riotous mob by forcible entry into the premises is an agreed fact. The question is as to whether the same amounts to a burglary or not.
21. Applying the recital contained in the operative clause extracted hereinabove, it is evident that burglary and housebreaking resulting in theft with an actual forcible and violent entry and exit has been confirmed through the evidence as well as the report of the Surveyor and therefore the incident is clearly covered as a risk under the policy in question.
22. However, what is to be analysed is as to whether the Exclusion clause 4(a) is attracted or not. The Exclusion clause recites that the Insurance Company shall not be liable in respect of loss or damage directly or indirectly, proximately or remotely occasioned by or which arises out of or an connection with riot and strike, civil commotion. The said Exclusion further absolves the Insurance Company from any liability due to terrorist activities, earthquake, flood, storm, volcanic eruption, typhoon, hurricane, tornado, cyclone or other convulsions of nature or atmospheric disturbances. This description of Exclusion is explicit and the occurrence of the loss or damage connected with riot and strike or civil commotion is clearly excluded.
23. It is at this juncture that the decision cited at the Bar needs consideration. We therefore take-up the decision of the learned Single Judge of the Delhi High Court in the case of Usha International Ltd. vs. United India Insurance Co. Ltd. (supra) relied on by the learned counsel for the petitioner. The said case involved a loss caused due to a theft as a sequence to the damaged caused to the insured property in a cyclone. The property was insured under two policies, one was a fire policy with an additional cover of special perils such as cyclone. The other policy was a burglary and housebreaking policy. The fire policy also included coverage due to destruction or damage caused by riot, strikes, malicious damage and terrorism. The Exclusion clause to the fire policy excluded several losses including cyclone, but in that case the peril of cyclone had been covered through an additional cover of special perils. The relevant Exclusion clause which requires our consideration is clause (b) of the Exclusion extracted hereinunder:
(b) Loss by theft during or after the occurrence of any insured peril except as provided for in Riot, Strike and Malicious & Terrorism Damage Clause.
24. Thus, loss by theft during or after the occurrence of any insured peril except as provided for riots and strikes had been excluded. Thus, loss by theft in so far as the incident after a cyclone is concerned, according to the Insurance Company stood excluded.
25. The burglary and housebreaking policy which once again defined theft upon the actual forcible and violent entry of and / or exit from the premises and hold-up was indemnifiable, but once again the Exclusion clause is similar in that policy as involved in the present case which is extracted hereinunder:
Clause (iv)
(a) Loss or damage directly or indirectly, proximately or remotely occasioned by or which arises out of or in 'connection with riot and strike, civil commotion, terrorist activity, earth quake, flood, storm, volcanic eruption, typhoon, hurricane, tornado, cyclone or other convulsions of nature of atmospheric disturbances.
26. The Delhi High Court analysed the policy and entered into an analysis, and the argument advanced on behalf of the petitioner that the loss arose on account of the burglary, was accepted. It was held that the loss was covered even under the fire policy as the act of theft was an independent act committed by miscreants by a forcible and violent entry into the premises by housebreaking after the cyclonic storm. The High Court further went on to analyse the burglary and housebreaking policy as well to hold that the same principle would apply for the burglary policy, in as much as, the incident of burglary had been proved. The High Court also entered into the contractual intention of the parties with both the policies on record and recorded findings in favour of the claimant therein.
27. However, what is relevant in the said decision is an illustrative argument regarding loot followed after riots. While analysing the same, the High Court made a reference to the notification dated 24.06.2002 issued by the Secretary Tariff Advisory Committee, IRDA and observed as under in paragraph 6:
6. The Petitioner vide its letters dated 1.3.2003 and 15.7.2003 drew the attention of Respondent to Notification No. FT/5/2002 dated 24.6.2002 issued by the Secretary, Tariff Advisory Committee, Insurance Regulatory and Development Authority (IRDA) Mumbai to all Insurance Companies whereby the looting caused as consequence of riots was accepted as a valid claim. The Petitioner requested the Respondent to reconsider its decision in the light of the ratio of the said Notification but in vain. Attention has justifiably been drawn to the said opinion of Shri N. Rangachary, Chairman, Insurance Regulatory and Development Authority which reads thus--
References have been received in this office on the status of claims that arise on looting connected with the riots in Gujarat. This matter was examined by the headquarters of Tariff Advisory Committee and on the basis of an interpretation made by the Committee, a view was expressed that claims to looting stand excluded in terms of fire policy currently in force under Item No. V of Section II of the Tariff. This exception built under Item 5 is found in clause (d) according to which claims relating to burglary, house breaking, theft, arson etc. committed in the course of a disturbance or public peace, if any, in malicious act would stand excluded from payment. New India, however, has clarified to its offices that such a claim would be payable. Support for this has been sought from the terminology of the old tariff as well as the current practices of the market. New India apparently also believes in adopting precedents where in similar situations in the past in 1984 Delhi riots, 1992 Bombay riots etc., claims have been paid by the nationalized companies. According to New India, the new tariff has not changed materially the old one and the new tariff has only brought together exceptions etc. found in different places. I have also received a representation from Mehta Padamasay of Bombay where the conditions of the policy had been examined by the firm and found to be supportive of payment. Along with the letter, extracts from well known books on fire insurance have also been attached which support the claim to payment.
Riot, strike, malicious damage and terrorism cover is an integral part of the fire policy. Only recently the terrorism part has been de-linked and separately priced. In other words, we still have the riot, strike and malicious damage claims covered by a fire policy. It is true that section II clause V of the policy documents covers the riots except the four situations which have been mentioned therein. Burglary, house breaking etc. occurring as part of a malicious act where such an act was committed in the course of a disturbance of public peace is listed as an exclusion. The exclusion does not specifically mention looting. However, to my mind, this does not make any material difference because the term can be considered to be similar to those used in the clause.
The relevant clause that one should look to would be clause II under general exclusions of the fire policy. This clearly supports the view that any claim under a RSMD cover will not be excluded under the general exceptions provision. The question whether looting is a part of the riot cover is not the issue now. The question to be considered confines itself to considering whether looting arising out of or following a riot is payable in terms of a fire policy. It is not disputed that the looting has followed the riots in these cases. The issue would be whether we should not take into account the proximate cause for the looting. If loss arises on account of looting in a riot where the riot peril itself is an insured peril, there should not be any difficulty in meeting the claim under the policy. As things stands at present, the tariff as well as the precedents that the industry has followed so far together with the authoritative literature on the subject support the payment for claim under the riot clause provided all other conditions of the policy have been satisfied. (underlining added for emphasis)
28. While dealing with the same and recording findings, the High Court made its observation in paragraph 15 of the said decision which is extracted hereinunder:
DECISION
15. The nomenclature of Fire Policy is indeed misleading as loss by fire is only one out of the six contingencies envisaged therein; the sixth possibility covers events of riot, strike, malicious damage and terrorism (hence RSMDT for short), the exclusion being loss by theft during or after the occurrence of any insured peril and/or natural calamity. The convoluted and complicated provision leads naturally to the question of how theft occurring during a riot is to be dealt with. These clauses would be mutually destructive of each other, thereby making the transaction a charade, unless they are construed to indicate that for theft to be included in the insurance cover it should bear causal relationship with the 'RSMDT'. In other words if a theft is committed by a person who is not a rioter or arsonist, that event may fall beyond the 'RSMDT' cover. This is also the opinion expressed by the Chairman of the Insurance Regulatory and Development Authority, and in the pragmatic and as also positive approach of the New India Assurance Company, but regretfully not the Respondent herein.
The Concise Oxford Dictionary defines riot as a violent disturbance of the peace by a crowd, and Black's Law Dictionary, Fifth Edition, defines the word thus-
"The term "riot" means a public disturbance involving (1) an act or acts of violence by one or more persons part of an assemblage of three or more persons, which act or acts shall constitute a clear and present danger of, or shall result in, damage or injury to the property of any other person or to the person of any other individual or (2) a threat or threats of the commission of an act or acts of violence by one or more persons part of an assemblage of three or more persons having, individually or collectively, the ability of immediate execution of such threat or threats, where the performance of the threatened acts or acts of violence would constitute a clear and present danger of, or would result in, damage or injury to the property of any other person or to the person of any other individual."
This definition brings the occurrences which are the subject matter of this petition within the ambit of the word "riot" and beyond the purview of the exclusion clause. The FIR records that 10 persons had forcibly entered the premises of the Petitioner and committed theft of some movable properties despite the resistance of the Petitioner's employees. The Respondents were, therefore, liable to be indemnifying by the Petitioner against theft under the Fire Police 'C'. Viewed in this analysis, the theft on which the claim is predicated would be payable on both the policies.
29. The aforesaid decision therefore did not leave anything in doubt to hold that the theft accompanied by violent means was a burglary while observing about such a loss following riots. Even though the case was arising out of a theft after a cyclone by a group of people, who had committed the burglary, the loss was held to be covered by the Burglary policy as well.
30. The ratio of the said decision as urged by the learned counsel for the complainant does get attracted on the facts of the present case and is a plausible argument.
31. However, while preparing the judgment, we further probed and researched into the follow-up of the said decision with the help of our Law Clerk Mr. Shikhar Prakash to find that the said judgment of the learned Single Judge was taken in appeal before the Delhi High Court in LPA No. 2716/2005, United India Insurance Co. Ltd. vs. M/s. Usha International Ltd. The said Letter Patent Appeal was dismissed on 23.01.2006 upholding the order of the learned Single Judge. The neutral citation of the said judgment as downloaded from the internet is 2006:DHC:18218. The decision is extracted hereinunder:
1. This writ appeal has been filed against the impugned judgment of the learned Single Judge dated 2.9.2005. We have heard the learned counsel for the parties and perused the record. The facts in detail have been set out in the judgment of the learned Single Judge and hence we are not repeating the same except where necessary.
2. The writ petitioner has a godown at Cuttak, Orissa which was insured by the appellant covering risks inter-alia against fire, theft, burglary, riots and such other calamities attributable to nature and circumstances beyond control.
3. On 1st and 2nd November, 1999 the employees of the petitioner at the respondent's Cuttak godown noticed that some miscreants had made forcible and violent entry into the godown which was an insured premises at Cuttak. Thieves had managed to steal a large quantity of stored goods by committing house-breaking from the rear side of the insured godown. The petitioner lodged an FIR dated 4.11.1999 and submitted a claim to the appellant in respect of such theft. However, the claim was rejected by letter dated 2.10.2000 stating that the incident was not covered by the two policies taken out by the petitioner. The petitioner protested and said that the incident was covered by the policy, but to no avail. Hence the writ petition.
4. Repeated opportunities were given by the learned Single Judge in the writ petition to file a counter affidavit, but no counter affidavit was filed. Hence, the petition was decided without a counter affidavit and the allegations in the writ petition remained unrebutted.
5. The submission of the learned counsel for the appellant is that the policies issued by the appellant to the respondent did not cover theft resulting out of a cyclone.
6. It appears that the theft was committed after the cyclone in burglary and house breaking policy dated 1.4.1999 clearly covers a case of theft in the house. No doubt that theft was subsequent to the cyclone, but it remains a theft. Hence, there is no force in this appeal and it is dismissed.
32. The story however does not stop short here as the aforesaid decisions were carried in Civil Appeal No. 4045/2006 before the Apex Court and the judgment passed on 07.09.2006 is downloaded and extracted hereinunder:
Leave granted.
Heard learned ASG appearing on behalf of the appellant-Insurance Company and learned senior counsel appearing on behalf of the respondent claimant.
The High Court on a detailed consideration of the peculiar facts and circumstances of the case directed the appellant-Insurance Company to pay to the respondent herein the sum of Rs.1,38,936/- together with interest thereon at the rate of 5% per annum from the date when the claim was preferred since the only defence of the appellant was that the claim was classified as a theft. The cost was also quantified at Rs.10,000/-. Aggrieved against the order dt. 02.09.2005 passed by the learned Single Judge, the appellant preferred an appeal before the Division Bench of the High Court. The learned Judges of the Division Bench of the High Court after due discussion came to the conclusion that the theft was committed after the cyclone in Orissa and that the Burglary and House Breaking Policy dt.01.04.1999 clearly covered a case of theft in the house. By holding so, the learned Judges of the Division Bench affirmed the order passed by the learned Single Judge.
In this appeal, several questions of law have been raised by the appellant-Insurance Company in regard to the Exclusion Clause of Burglary and House Breaking Policy. Since the learned Single Judge and the Judges of the Division Bench have decided the matter on the basis of peculiar facts and circumstances of the present case, the learned Single Judge ordered the sum of Rs.1,38,936/- as compensation and the same was affirmed by the Division Bench. Since it is decided purely on the peculiar facts and circumstances of the present case, we are not inclined to interfere with the concurrent finding of the High Court.
However, we leave the question of law raised in this appeal open to be decided in an appropriate case. We also make it clear that the order passed by the learned Single Judge and as affirmed by the Division Bench cannot be treated as a precedent in any other matter.
We direct the appellant-Insurance Company to pay the sum of Rs.1,38,936/- together with interest thereon at the rate of 5% per annum from the date when the claim was preferred to the respondent-claimant within two months from today. The cost awarded by the High Court should also be paid within the stipulated time. However, the direction given by the High Court in regard to penal interest is set aside. The appeal is disposed of accordingly.
No costs.
33. A perusal of the order of the Apex Court therefore leaves no room for doubt that the judgment of the learned Single Judge as affirmed by the Division Bench has been treated only as a judgment on the peculiar facts of the said case and therefore was not being interfered with as it involved a paltry sum of Rs. 1,39,936/- with some interest thereon and costs awarded, but at the same time, the Apex Court did not approve of the judgment by categorically observing that the question of law raised was left open and that the impugned judgments cannot be treated as precedents. In the wake of the aforesaid judgment of the Apex Court, it will be difficult for us to be persuaded by the ratio of the judgment of the Delhi High Court for the reasons given hereinabove and hereinafter.
34. In addition to the fact that the Apex Court has eclipsed the precedential value of the judgement of the Delhi High Court, on the facts of the present cae and the terms and the conditions of the policy, we find that the Exclusion clause is categorical. The question is as to whether the loss of damage caused has been occasioned in a manner so as to exclude liability. It is here that we would refer to the principle of direct and proximate causes that occurred simultaneously in the present case and can be treated to be concurrent. The ratio of the English decision cited by Mr. Amit Kumar Singh in the case of the University of Exeter (supra) therefore, in our opinion, applies squarely on the facts of the present case where the aforesaid principles have been discussed in detail to hold that where there are two proximate causes of loss, of which one is an insured peril, but the other is expressly excluded from the cover of the policy, then in that event the Exclusion clause will prevail.
35. In the instant case, the riot was followed by the loot. It is not the case that the robbery had taken placed earlier followed by the riot. It is the admitted case that the loot occurred during the riot and therefore the causes were proximate, and the loot in all probability might not have occurred had there been no riot. The fact however remains that the loot did occur during the riot and was therefore proximate to the dominant cause of riot.
The ratio of the English decision on proximate causes and concurrent causes coupled with the exclusion terms of the present policy therefore clearly excludes the indemnification of the loss suffered by the complainant due to riots.
36. In view of the aforesaid conclusions drawn, it is not necessary for us to enter into any of the other issue as we are of the opinion that the State Commission was justified in reversing the order of the District Commission that had not dealt with the matter in accordance with the law referred to hereinabove.
37. For all the reasons discussed above, the Revision Petition fails and is hereby dismissed.
..................J A. P. SAHI PRESIDENT ..................
BHARATKUMAR PANDYA MEMBER PRAMOD SINGH MEHTA/Court-1/E