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 Oh ho........, me and  PP RAGHAVACHARY have posted the judgment at the same time. What a coincidence!!!!!!!

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Dear Sir.PP.Raghavacharv and Sir.Vinodkumar, thank you so much for the valuable contributions. I have been paper hunting for this case in various websites but could not locate it. Once again thank you both of you for the valuable help.

    
CASE NO.:
Appeal (civil)  391 of 1999

PETITIONER:
United India Insurance Co. Ltd.

RESPONDENT:
M/s. Pushpalaya Printers	

DATE OF JUDGMENT: 25/02/2004

BENCH:
Shivaraj V. Patil & Dr. AR.Lakshmanan.

JUDGMENT:
J U D G M E N T


Shivaraj V. Patil, J.


	The respondent filed a complaint before the 
District Consumer Disputes Redressal Forum (District 
Forum) under Section 12 of the Consumer Protection Act, 
1986 (for brevity 'the Act') praying for settlement of 
an insurance claim at Rs.75,000/- along with interest 
at the rate of 18% per annum.  The appellant repudiated 
the claim on the ground that damage caused to the 
building and printing press of the respondent was not 
covered by Clause 5 of the insurance policy.  The 
District Forum accepting the contention urged on behalf 
of the appellant held that there was no deficiency of 
service on the part of the appellant and dismissed the 
complaint as not maintainable.  The respondent filed 
appeal before the State Consumer Disputes Redressal 
Commission (State Commission) against the order of the 
District Forum. The State Commission, on interpretation 
of the word "impact" contained in Clause 5 of the 
insurance policy, allowed the appeal, set aside the 
order of the District Forum and granted relief to the 
respondent directing the appellant to pay a sum of 
Rs.75,000/- with interest at the rate of 12% per annum 
with effect from 18.10.1994 till the date of payment.  
The appellant, dissatisfied with the order of the State 
Commission, filed revision petition before the National 
Consumer Disputes Redressal Commission (National 
Commission).  The National Commission, while accepting 
the interpretation given by the State Commission, 
however, reduced the amount of payment to the 
respondent from Rs.75,000/- to Rs.56,000/-.  Aggrieved 
by said order of the National Commission, this appeal 
is brought before this Court by the appellant.
	Before us, learned counsel for the parties in 
their arguments reiterated their respective 
contentions, which were urged before all the forums.  
In order to consider the respective contentions urged 
on behalf of the parties, it is both necessary and 
useful to quote the relevant portions from the 
insurance policy: -
"IN CONSIDERATION OF THE insured named 
in the Schedule hereto having paid to 
United India Insurance Company Limited 
(hereinafter called THE COMPANY) the 
premium mentioned in the said schedule.  
Till company agrees, (subject to the 
condition and exclusion contained herein 
or endorsed or otherwise expressed 
hereon) that if after payment of premium 
the property insured described in the 
said schedule or any part of such 
property, be destroyed or damaged by the 
following: -
1.	.......
2.	.......
3.	.......
4.	.......
5.	Impact by any rail/road vehicle or 
animal."

	In the order of the District Forum it is noticed 
that the appellant contested the claim by filing 
written objection contending that the damage caused due 
to vibration from the operation of bulldozer was not an 
incident of impact by any road vehicle, as per Clause 5 
of the insurance policy for risk, and so the complaint 
was not maintainable.  Para 4 of the order of the 
District Forum reads: -
"4.	Neither party led any evidence 
because it was admitted by the Opposite 
Party that in connection with a road 
construction with the help of a 
bulldozer near the complainant's 
printing press in question there was 
damage to that building.  And, both 
parties agreed that it all depends upon 
the interpretation of the term (5) of 
the Insurance Policy."

Thus, from the order of the District Forum it is clear 
that the appellant did not dispute as to damage caused 
to the building and machinery of the respondent on 
account of the bulldozer driven close to the building 
on the road for the purpose of road construction and 
that both the parties agreed that the sustainability of 
the claim depended upon the interpretation of Clause 5 
of the insurance policy.  The District Forum took a 
narrow view that the word "impact" contained in 
clause 5 of the insurance policy covered risk of only 
contingent impact of a road vehicle forcibly coming in 
contact with another.  It held that the damage caused 
to the building and machinery in the instant case was 
not due to such forcible contact but it was due to the 
consequential effect of vibration on account of 
operating of a bulldozer by the side of the 
respondent's printing press building and as such it was 
not covered by clause 5 of the insurance policy; thus, 
there being no deficiency of service on the part of the 
appellant the complaint filed by the respondent was not 
maintainable.
	According to the State Commission the only point, 
which arose for decision in the appeal was whether the 
damage caused to the building and the machinery of the 
respondent was the resultant of the impact by the 
bulldozer.  Considering the meaning of the word 
"impact" given in various dictionaries the State 
Commission took the view that when the word "impact" 
has got meanings more than one and the word "impact" 
not only means "coming forcibly in contact with 
another", it also means "to drive close", "effective 
action of one thing upon another" and "effect of such 
action".  The "impact" covered damage caused to the 
building and machinery in view of the admitted fact 
that such damage was caused because of close drive by 
the bulldozer on the road.  Expressing thus the State 
Commission set aside the order of the District Forum 
and granted relief to the respondent.
	The National Commission concurring with the view 
expressed by the State commission interpreting the 
expression "impact" observed that the said word has 
to be construed liberally and in its wider sense.  
	The only point that arises for consideration is 
whether the word "impact" contained in clause 5 of 
the insurance policy covers the damage caused to the 
building and machinery due to driving of the bulldozer 
on the road close to the building.  It is evident from 
the terms of the insurance policy that the property was 
insured as against destruction or damage to whole or 
part.  The appellant company agreed to pay towards 
destruction or damage to the property insured to the 
extent of its liability on account of various 
happenings.  In the present case both the parties 
relied on clause 5 of the insurance policy.  Clause 5 
is also subject to exclusions contained in the 
insurance policy.  That a damage caused to the building 
or machinery on account of driving of vehicle on the 
road close to the building is not excluded.  Clause 5 
speaks of "impact" by any rail/road vehicle or 
animal.  If the appellant company wanted to exclude any 
damage or destruction caused on account of driving of 
vehicle on the road close to the building, it could 
have expressly excluded.  The insured possibly did not 
understand and expect that the destruction and damage 
to the building and machinery is confined only to the 
direct collusion by vehicle moving on the road to the 
building or machinery.  In the ordinary course, the 
question of a vehicle directly dashing the building or 
the machinery inside the building does not arise.  
Further, "impact" by road vehicle found in the 
company of other words in the same clause 5 normally 
indicates that damage caused to the building on account 
of vibration by driving of vehicle close to the road is 
also included.  In order to interpret this clause, it 
is also necessary to gather the intention of the 
parties from the words used in the policy. If the word 
"impact" is interpreted narrowly the question of 
impact by any rail would not arise as the question of a 
rail forcibly coming to the contact of a building or 
machinery would not arise.  In the absence of specific 
exclusion and the word "impact" having more meanings 
in the context, it cannot be confined to forcible 
contact alone when it includes the meanings "to drive 
close", "effective action of one thing upon another" 
and "the effect of such action", it is reasonable and 
fair to hold in the context that the word "impact" 
contained in clause 5 of the insurance policy covers 
the case of the respondent to say that damage caused to 
the building and machinery on account of the bulldozer 
moving closely on the road was on account of its 
"impact".  It is also settled position in law that if 
there is any ambiguity or a term is capable of two 
possible interpretations one beneficial to the insured 
should be accepted consistent with the purpose for 
which the policy is taken, namely, to cover the risk on 
the happening of certain event. 	Although there is no 
ambiguity in the expression "impact", even otherwise 
applying the rule of contra proferentem, the use of the 
word "impact" in clause 5 in the instant policy must 
be construed against the appellant.  Where the words of 
a document are ambiguous, they shall be construed 
against the party who prepared the document.  This rule 
applies to contracts of insurance and clause 5 of the 
insurance policy even after reading the entire policy 
in the present case should be construed against the 
insurer.  A Constitution Bench of this Court in General 
Assurance Society Ltd. vs. Chandumull Jain & Anr. [1966 
(3) SCR 500] has expressed that "in a contract of 
insurance, there is requirement of uberrima fides, i.e. 
good faith on the part of the assured and the contract 
is likely to be construed contra proferentem i.e. 
against the company in case of ambiguity or doubt."
	In the light of what is stated above, no fault can 
be found with the impugned order.  The interpretation 
placed by the State Commission as well as by the 
National Commission in relation to the expression 
"impact" is in order and appropriate.  Hence the 
point is answered in the affirmative.
	Under the circumstances we find no merit in the 
appeal.  Consequently it is dismissed.  No costs.




 
  

Dear Manu, thank you for the help and taking the trouble for my needs,