SANJAY MADAN Vs. NATIONAL INSURANCE COMPANY

JUDGEMENT

(1.) THIS appeal is instituted under section 39 of the Arbitration Act, 1940 against the judgment dated 15.9.2010 passed by learned Single Judge in Arbitration case No. 16 of 2006.

(2.) "Key facts" necessary for the adjudication of this petition are that on the night of 21.2.1992, when the Insurance Policy was in operation, a fire broke out in the insured house of the appellants. The house was gutted into fire completely alongwith fittings, fixtures etc. A claim of Rs. 36,00,000/ - was preferred against the respondent -Insurance Company. Surveyor was deputed by the Insurance Company. Surveyor assessed the claim at Rs. 26,09,668/ - vide his report 18.8.1992. Appellants were paid a sum of Rs. 10,00,000/ - on 18.2.1993 against receipt and another sum of Rs. 16,09,668/ - vide receipt dated 23.8.1993. The appellants served a notice dated 5.9.1993 Ex. CR -1 upon the Insurance Company claiming a sum of Rs. 9,30,332/ - as balance amount of the insurance claim. The appellants invoked arbitration clause and two arbitrators, i.e. one by the claimants and one by the Insurance Company were appointed. Appellants appointed Sh. R.L. Sood, as Arbitrator while Insurance Company appointed Maharaj Bakhash Singh. Sh. Maharaj Bakhash Singh gave his separate award on 24.7.2003. Thereafter, Sh. R.L. Sood gave his award on 28.4.2004. Sh. Maharaj Bakhash Singh did not award any amount to the appellants. Sh. R.L. Sood awarded a sum of Rs. 9,30,332/ -, i.e. the difference of the claim made by the claimants, soon after the occurrence of incident of fire and the amount paid by the Insurance Company on the basis of Surveyor's report. Since the Arbitrators did not agree, the matter was referred to the Umpire. The Umpire vide award dated 12.12.2004 has agreed with the award of Sh. R.L. Sood and awarded the amount together with interest and costs as awarded by Sh. R.L. Sood.

(3.) SH . R.L. Sood, being one of the Arbitrators, filed award in the Court under section 14 of the Arbitration Act, 1940. Notices were issued to both the parties by the Court. The appellants applied for making the award of the Umpire Rule of Court while Insurance Company filed objections. Learned Single Judge framed the following issues: