NATIONAL INSURANCE CO LTD Vs. SHARP MENTHOL LTD

JUDGEMENT

(1.) This petition has been filed under Section 34 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as the 'Act') challenging the Arbitral Award dated 21st July 2011 (hereinafter referred to as the 'Impugned Award') passed by the Arbitral Tribunal comprising of three Arbitrators. The Impugned Award directs the petitioner herein to pay to the respondent an amount of Rs.3,70,46,874/- with pre-award as well as future interest.

(2.) The respondent company being a manufacturer of Menthol crystals, Menthol powder and other essential oils from Crude Mentha Oil (CMO), sought insurance of their factory for Fire and allied perils located at C-15, SMA Co-operative industrial Estate, Delhi-110033. The said factory was insured for Fire and Allied perils vide two separate Fire Policies; (a) Fire Insurance Policy "C" No. 360800/11/330101/97 issued by the petitioner, which was co-insured with Oriental Insurance Co. Ltd, with the petitioner's share at 60%, (b) Fire Insurance Policy "C" Cover No. 471571 dated 22.1.1998 issued by Oriental Insurance Co. Ltd. with no co-insurers. The Impugned Award is passed in Arbitral Proceedings in which Fire Insurance Policy "C" No. 360800/11/330101/97 (herein after referred to as 'Fire Policy') forms the subject matter.

(3.) The aforesaid Fire Policy issued by the petitioner insured the respondent for an amount of Rs. 18,40,00,000/- for a period ranging from 13th October 1997 to 12th October 1998. The breakup of the Items insured is given below: Sr. No. Item Sum Insured Rs. 1. "On Building" 1,00,00,000 2. "On F.F. Fittings and electrical & Sanitary fittings electrical installation office equipments and machines" 30,00,000 3. "On Plant, Machinery & its accessories tools and Lab equipments etc" 1,00,00,000 4. "On Stock of raw material of various type, semi-finished and finished goods, goods in process and packing material etc." 16,00,00,000 5. "On D.G.Sets" 10,00,000 Total 18,40,00,000