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Learned Senior Counsel also relied on the notification dated 21.11.2001 issued by the Ministry of Petroleum and Natural Gas in exercise of its powers under the Essential Commodities Act, 1955 (“the Essential Commodities Act”), to argue that the Appellant was exempt from obtaining a licence for storage of Hexane, since according to him, the Appellant had stored less than 20 kilolitres of Hexane. It was submitted that the said notification clearly stipulated that there was no requirement of a licence for storing up to 20 kilolitres of Hexane.

5. On the other hand, learned Senior Counsel appearing on behalf of the Respondent, Shri P.P. Malhotra, contended that repudiation of the claim was justified, inasmuch as the Appellant had not disclosed that it was not in possession of the requisite licence for storing Hexane. It was contended that the Appellant was required to obtain a licence as per either Article 3 or Article 7 of the First Schedule to the Petroleum Rules, 1976 (“1976 Rules”).

5.1 It was further argued that even assuming that the aforementioned notification dated 21.11.2001 exempted the Respondent from obtaining a licence for storing Hexane up to 20 kilolitres, the second surveyor’s report, against which the Appellant had not raised any objection, was categorical in its finding that the factory premises held over 90 kilolitres of Hexane, out of which 79.152 kilolitres of Hexane had suffered damage. Thus, no reliance could be placed on the exemption under this notification in the instant facts and circumstances. 5.2 Learned Counsel also argued in favour of the finding of the National Commission with respect to overvaluation of the subject factory by the Appellant while taking insurance.

-23°C.1 Admittedly, the substance being stored by the Appellant was n-Hexane, or normal Hexane. Indeed, as per nomenclature adopted by the International Union of Pure and Applied Chemistry, the substance carrying the molecular formula C 6H14 is known as “Hexane” or “n-Hexane”. 2 This is also supported by Bretherick’s Handbook of Reactive Chemical Hazards , referred to by the Respondent, which notes that Hexane, NFPA 497, Recommended Practice for the Classification of Flammable Liquids, Gases, or Vapors and of Hazardous (Classified) Locations for Electrical Installations in Chemical Process Areas (2017 edition).

33. Before we part with this matter, we may note that some objection was raised by the Appellant against the appointment of the third surveyor by the Respondent. Suffice it to state that the appointment of the third surveyor was for the limited purpose of examining whether the Appellant was in possession of the requisite licences for the storage of Hexane. Moreover, neither did the findings of the third surveyor disturb the findings of the second surveyor, nor were they material to the conclusion against the Appellant arrived at by the National Commission. The second surveyor had given a categorical finding that about 90 kilolitres of Hexane were stored in the factory premises, and this finding has not been challenged by the Appellant. At the same time, while the findings of the third surveyor supplement the reasoning of the National Commission vis-à-vis the absence of a licence under the Petroleum Act and 1976 Rules, they are not crucial to this conclusion, inasmuch as the Appellant itself never contended that it was in possession of the requisite licences for the storage of Hexane. As a result, we find that irrespective of whether or not the appointment of the third surveyor was proper, the findings of the said surveyor do not materially affect the outcome of the instant case.