BHOLENATH COLD STORAGE Vs. NATIONAL INSURANCE COMPANY LIMITED

JUDGEMENT

(1.) The present Rule was issued on 17.5.1985 at the instance of the writ petitioner praying inter alia for a Writ of Mandamus commanding the respondents to settle the claims lodged by the petitioners and communicate their decision with regard to the claims in consequences of the loss and damage sustained by the petitioner due to the flood in the year 1978 and for other consequential reliefs as stated in details in the writ petition. It is stated in details that the petitioner is a registered Partnership firm carrying on Cold Storage business. The plant and machinery were installed and these were extremely sensitive requiring stable temperature. The petitioners proposed to insure their stock of potatoes stored in the cold storage premises situated at Chilleydanga, P.S. Pursura in the District of Hooghly for a total sum of Rs. 17 lacs against the contingencies stipulated with the respondent Nos. 1 to 5 viz., National Insurance Company, Oriental Fire & General Insurance Company of different divisions and the New India Assurance Company. The petitioner also proposed to insure the buildings, plant and machinery and installation and racks of the cold storage for a total sum of Rs. 28 lacs with the respondent Nos. 1 to 4 respectively. There is also an agreement that the respondent No. 2 Oriental Fire & General Insurance Company towards the deterioration of Stock Policy for a sum of Rs. 22 lots and machinery break down policy for a sum of Rs. 8.18 lacs. It is alleged that the respondent No. 1 the National Insurance Company Limited gave out in writing on 7th of February, 1979 by issuing Insurance Policy bearing No. 320/124811 (M) in favour of the petitioner against the contingencies and/or perils of fire, riot, M.D. Explosion, E.F.S. Cyclone and Flood etc., on the conditions stipulated in the said policy to the extent of RS. 10 lacs on stock of potatoes stored in the cold storage. It is further alleged that a clause was incorporated in the Policy indicating inter alia :

(2.) Various clauses in the policy have been referred in the writ petition for appreciating the rights and obligations of the respective parties. It is placed on record that on March 7, 1978, the petitioner approached the respondent No. 4 in insuring the buildings, plant and machinery as well as stock of potatoes lying with the drawing safe and the petitioner sent a cheque for Rs. 9,800/-. There is a communication from the petitioner to cover the risk of deterioration of temperature clause of stock policy. There is a reference of chain of correspondences between the parties as elaborately disclosed in writ petition. It is specifically claimed that subsequent to the contract entered into by and between the petitioner and the respondents and premium being accepted after approval and/or acceptance of the proposal of the petitioner, there was an unprecedented flood inundating cold storage premises and as a result thereof, there was a huge damage of potatoes in the cold storage as well as there was a building, plant and machinery. Immediately thereafter, the petitioner duly informed about the aforesaid flood by addressing several telegrams and letters to all the respondents. The petitioner allegedly intimated that it sustained a loss to the tune of Rs. 20 lacs and the petitioner lodged a claim for the aforesaid amount. By a letter dated 13th November, 1978 addressed to the Surveyor, Messrs. Ascon & Avins of 14, India Exchange Place, Calcutta detailing the particulars of loss sustained by the petitioners. There is an allegation that the claim has not been settled and the petitioner has been compelled to come to the Writ Court to seek reliefs that the actions taken by the respondent authorities are contrary to law and prejudicial to the interest of the petitioner and is in violation of the principles of natural justice.

(3.) The writ petition is contested by the respondents by filing an affidavit-in-opposition. A common defence is taken that the parties entered into commercial contracts and even if there is any breach, the remedies are only available by way of suit for damages against the respondents insurer companies and not by filing a writ petition. It is placed on record that pursuant to the letter of the petitioner to the respondent No. 1 dated 8th of March, 1978 and the proposal for Fire Insurance dated 8th of March, 1978 covered the stocks in this cold storage, there is a stipulation by deleting the clause viz., "it is a condition that the insurance Company, shall not be liable for loss and damages which is resulting from a total partial destruction or disbursement by fire refrigerating plant". It is further placed on record that after the flood, the respondent No. 1 appointed the independent Surveyor Messrs. Aston & Avins to survey and assess the damage and/or loss sustained by the petitioner without prejudice to the tights of the insurance. From the surveyor's report, it has to be ascertained and the report with annexures will speak for itself. It is further elaborated that the purported policy was issued by mutual mistake purporting to cover loss or damage, and mainly the respondents have denied the liability by claiming that since the respondent No. 6 Union of India has been expunged from the cause title, the writ petition is not maintainable and the petition may be dismissed accordingly.