New India Assurance Company Ltd. And Anr. vs Shyam Sunder Hetamsariya And Ors. on 14/9/2007
JUDGMENT
D.G.R. Patnaik, J.
1. The defendant-appellant have preferred the instant appeal against the judgment and decree dated 24.1.1996 and 7.2.1996 passed by the Subordinate Judge 7th, Ranchi, in Money Suit No. 26 of 1992 whereby the suit as filed by the plaintiff-respondents for a sum of Rs. 5.54.898/20P alongwith interest at the rate of 19-1/2% per annum from the date of institution of the suit i.e. 10.3.1992 till the realisation of the amount, was decreed in favour of the plaintiff-respondents.
2. The case of the plaintiff-respondents is that the plaintiffs have been carrying on a cloth business in the name and style of Vimal Deep having their show room of the products and goods of Vimal Fabrics. The show room and business premises is located on the Main Road in town of Ranchi. The plaintiffs had entered into a contract of insurance with the defendants to cover risk of loss of goods in stock of the plaintiff's shop on account of theft and burglary and also on account of fire and damages. The defendants undertook to cover the risk of loss of the plaintiffs to the extent of Rs. 12.50 lakhs on account of loss due to theft and burglary under Policy No. 5329100580. Further case of the plaintiffs is that since it had obtained substantial loan from the Canara Bank hypothecating the entire stock and the goods of the shop, the plaintiffs used to submit monthly statement of account relating to the stock to the Bank in its regular course of business.
On the night of 28/29th December, 1984, a burglary occurred in the shop of the plaintiffs. The burglars by use of violence had broken open the lock of the iron shutters and after entering into the shop, had stolen away the cloths and goods from within the shop of the plaintiffs' shop. The theft was detected on the next morning and the First Information Report (FIR) was lodged at the police station on 29.12.1984. The extent of value of the goods stolen away was assessed at Rs. 5,54,898/-. The plaintiffs put up their claim with the defendants to reimburse the loss to the extent of the amount assessed. In response to the claim raised by the plaintiffs, the defendants have deputed a Surveyor of M/s M.T. Kothari and Company, who after conducting survey and complete inquiry, submitted his survey report. Not being satisfied with the report submitted by the surveyor, the defendant Insurance company deputed another surveyor namely S.R. Kar Roy, who also conducted survey and submitted his report recommending payment of compensation to the plaintiffs. On investigation of the case on the basis of the FIR, the Police submitted a final report declaring that the case was not true and that the informant should be prosecuted for the offence under Section 211 of the Indian Penal Code. The plaintiffs claim that the Police did not investigate the case properly and became hostile to the plaintiffs and submitted final report declaring falsely that no theft had occurred and went to the extent of even recommending proceedings against the informant under Section 211, IPC. The plaintiffs promptly lodged a protest petition against the final report in the Court of the Chief Judicial Magistrate and consequently the final report was not accepted by the Magistrate. Meanwhile, the plaintiffs kept on reminding the defendants to pay the claim amount on the basis of the insurance policy, but the defendants continued to delay the matter for over six years and ultimately by letter dated 5.12.1991, repudiated the claim of the plaintiffs refusing payment of compensation. The plaintiffs claim that cause of action had accrued to them on 5.12.1991 on account of refusal of the defendants to acknowledge the claim of the plaintiffs as a result of which, the plaintiffs filed the instant suit.
3. The defendant insurance company contested the suit by filing written statement and claiming that the suit is not maintainable on the principles of waiver, estoppel and acquiescence under the Specific Relief Act and that the suit is barred by limitation. The case of the defendants is that the plaintiffs had no cause of action whatsoever since no theft or burglary was committed in the business premises of the plaintiffs, and therefore, the plaintiffs had not suffered any loss of goods on account of the alleged theft. In support of their contention, the defendants have relied upon the final report submitted by the Police on the conclusion of the investigation in the FIR lodged by the plaintiffs. The defendants further claim that the stock of goods of the plaintiffs' shop was not covered under any policy of insurance on the date of the occurrence. The defendants have also denied the plaintiffs' contention that the surveyor namely S.R. Kar Roy had recommended payment of compensation to the plaintiffs.
4. On the basis of the rival pleadings, the trial Court framed the following issues.
(i) Is the suit as framed maintainable?
(ii) Have the plaintiffs a valid cause of action for the suit?
(iii) Is the suit bared by law of limitation?
(iv) Whether the theft and burglary was committed i.e. in the business premises of the plaintiffs in the night of 28/29th December, 1984 causing damage and loss to the plaintiffs as claimed in the suit?
(v) Whether the plaintiffs had kept the alleged insured goods under proper safety as per insurance policy?
(vi) Are the plaintiffs entitled to a decree as sought for in the plaint?
5. Considering issues No. (iv) and (v) as the main issues in the dispute between the parties, the trial Court had referred to the evidences adduced by both the parties and had recorded its finding that the stock of the goods in trade of the plaintiffs kept within its shop was covered under the policy of insurance with the defendant insurance company and that under the policy of insurance, the defendants' insurance company had undertaken to compensate for the loss of goods kept in the plaintiffs' shop on account of theft and burglary. The learned trial Court also recorded its finding that on 28/29th December 1984, a burglary did occur in the business premises of-the plaintiffs and there was no lapses on the part of the plaintiffs in keeping the insured goods under proper safety as per the insurance policy. The trial Court had also recorded its finding that on the basis of the certified monthly statements submitted by the plaintiffs to the Bank in respect of its stock and goods, the plaintiffs had suffered loss on account of theft of goods to the extent assessed and claimed by the plaintiffs. Both issues were thus decided in favour of the plaintiffs. On issue No. (iii) as to whether the suit was barred by limitation, the learned trial Court held that it was not barred by limitation since the suit was filed within one year from the date the defendants had intimated to the plaintiffs of its decision of having repudiated the claim for compensation by the plaintiffs. On the remaining issues also, the learned trial Court recorded its findings in favour of the plaintiffs and while allowing the prayer of the plaintiffs, decreed the suit in favour of the plaintiffs.
6. The appellant insurance company has challenged the impugned judgment and decree of the Court below on the ground that the findings recorded by the trial Court on various issues, particularly issues No. IV and V are improper and without proper evaluation of oral and documentary evidences available on record and it is based merely on conjecture and surmises and for untenable reasons. The appellant has further found fault with the impugned judgment on the rate of interest at 19-1/2% per annum as imposed by the trial Court, on the ground that the trial Court was neither competent to grant such a high rate of interest, nor was it permissible in the law or under the contract. It is further contended that the business premises of the plaintiffs was not covered under the policy of insurance on the alleged date of burglary and the plaintiff had failed to produce the insurance policy and that the trial Court failed to consider this aspect of the matter which was also raised in the pleadings of the defendants, besides in the oral evidences adduced by the defendants.
7. Mr. D.C. Ghosh, learned Counsel for the appellants argues emphatically that the trial Court has seriously erred in relying upon Ext 12D which is merely a receipt showing deposit of some premium amount which in itself does not confirm that other formalities relating to the renewal of the insurance policy was completed by the plaintiffs. Learned Counsel argues that the finding of the trial Court that the business premises of the plaintiffs was covered by the insurance policy by way of renewal of the old policy, is totally an erroneous finding. Learned Counsel further contends that the plaintiffs had not produced before the income tax authorities the books of accounts, stock registers and other relevant documents to show the position of stock of goods on the date of the occurrence and the loss sustained due to the occurrence and thus, the plaintiff had failed to substantiate their claim money and the defendants have not pointed out any infirmity or impropriety in the amount assessed by way of loss.
8. The questions which arise for determination in this appeal are:
(i) whether any burglary was committed in the business premises of the plaintiffs on the night of 28/29.12.1984?
(ii) whether the stock and goods kept within the premises of the business of the plaintiffs was covered under any policy of insurance with the defendants on the alleged date of burglary?
(iii) Whether the defendants are liable to pay the amount claimed by the plaintiff-respondents on account of loss sustained?
9. Certain facts which have not been denied by the defendants are that the plaintiffs have been carrying on cloth business in the name and style of Vimal Deep and the plaintiffs had taken a loan from Canara Bank for purchase of stock of goods for trade which were hypothecated with the Canara Bank. It is also not disputed that under the terms of the agreement with the Bankers, the plaintiffs used to submit monthly statements of stock to the bankers. It is also not disputed that the business premises of the plaintiffs together with entire stock of goods kept therein was insured with the defendant insurance company covering the risk on account of loss against burglary and theft for Rs. 12.50 lakhs. It is also not disputed that the insurance policy used to be renewed from year to year and the plaintiffs used to pay annual premium at the stipulated rate to the defendant insurance company.
It is also noted disputed that the plaintiffs lodged FIR with the police informing that burglary was committed in the business premises of the. plaintiffs on 28/29th December, 1984. It is also not disputed that on the basis of insurance policy, the plaintiffs had put up their claim before the defendant company for compensation for the loss sustained on account of burglary to the extent of over Rs. 5,54,898/20P. It is also not disputed that on receipt of the claim petition filed by the plaintiffs, the defendant company had deputed surveyors, one after another, who after conducting their respective inquiries, had submitted their reports. The plaintiffs claim that the surveyors had recommended for payment of compensation to the plaintiffs, but the defendants do not acknowledge any such recommendation made by the surveyors.
The point of dispute as raised by the defendants are (i) that no theft had occurred in the business premises on 28/ 29th December 1984 as per the police report (Ext. A).
(ii) that the business premises and the stock in trade of the plaintiffs were not covered under any insurance policy on the alleged date of burglary and therefore the defendants are not liable to pay compensation for the loss sustained by the plaintiffs, if any, on account of any alleged burglary.
10. In course of trial, the plaintiffs had adduced oral evidence of their and also adduced documentary evidence. The oral evidences are on the point that the burglary was committed in the business premises of the plaintiffs on 28/29th December, 1984 and that FIR was promptly lodged with the police concerning the burglary. The witnesses who have deposed on these points are not only the Salesmen employed by the plaintiffs at the business premises of the plaintiffs, but also the neighbouring shop keepers. The defendants/respondents has sought to dispute the evidence on this issue relying entirely on the police report (Ext. A). The trial Court had refused to accept the police report and contents thereof mainly on the ground that the maker of the report was not examined by the defendants and that such examination was necessary in view of the specific pleadings of the plaintiffs that the police officer was hostile to the plaintiffs on account of ulterior reasons. Admittedly, the police report submitted by the police was not accepted by the CJM before whom the report was submitted, indicating thereby that the findings of the police officer as made in the police report and recommendations contained therein were not accepted. Even on a reading of the police report and as has been rightly found by the trial Court also, it would appear that on his visit to the place of the occurrence, the police officer had found enough materials to confirm that burglary was committed in the business premises of the plaintiffs, and even the witnesses whose statements were recorded by the police officer, have confirmed the same. Some of these witnesses have been examined by the plaintiffs in course of trial who have re-affirmed about the occurrence of burglary. In view of the above facts and evidence, the learned trial Court rightly recorded its findings that the burglary did occur in the night of 28/29th December, 1984 in the business premises of the plaintiffs. The police report in itself is not sufficient to disprove this fact. The defendants have not adduced any evidence on their side to disprove the fact that burglary was committed in the business premises of the plaintiffs.
11. On the issue as to whether the business premises including the stock in trade and the goods of the plaintiffs was insured with the defendants covering the risk of loss due to theft and burglary on the date of theft, there is the oral evidence of plaintiffs' witnesses besides documentary evidence: The plaintiffs have filed insurance policies of the years 1982-83 and 1985-86 onwards. The insurance policy relating to year 1984 has however not been filed by the plaintiffs. Nevertheless, the plaintiffs have adduced evidence which indicates that the plaintiffs' business premises along with entire stock-in-trade was originally insured with the defendants and the insurance policy used to be renewed from year to year on the plaintiffs depositing the stipulated premiums. The insurance policy covering the risk of loss on account of theft and burglary has been specifically mentioned as Policy No. 5329100580 and the premium in respect of the aforesaid policy was paid by the plaintiffs and such payment was acknowledged by the defendants vide receipt Ext. D. which is dated 18.8.1984. This evidence clearly suggests that it was the accepted practice to renew the previous policy of insurance every year on receipt of amount of stipulated premiums. The defendants cannot be allowed to plead that even after having accepted the premium amount from the plaintiffs for renewal of the previous insurance policy for the entire one year, they are not liable to undertake any risk merely because the defendants had not obtained the letter of renewal of the previous policy from the defendants. The receipt accepting premium for the year 1984 is dated 18.8.1984 and it is sufficient proof on the part of the plaintiffs to confirm that the previous policy for the year 1983 was renewed for 1984 on the acceptance of the premium amount by the defendant insurance company. It may also be noted that even the witness examined by the defendants on this issue has categorically acknowledged that the business premises of the plaintiffs together with entire stock-in-trade in the business premises, was covered under the insurance policy with the defendant insurance company and it was valid on the date of burglary. The defendants therefore cannot back out from their liability under the insurance policy.
12. As regards the genuineness of the amount assessed by the plaintiffs by way of loss suffered by them due to theft and burglary, the defendants have disputed the amount on the ground that the plaintiffs did not submit before the Income Tax authorities their statements along with the stock registers, sales registers and other documents and in absence of any certificate issued by the income tax authorities regarding the loss sustained by the plaintiff-respondents, the plaintiffs' claim cannot be acknowledged as a genuine claim.
13. It is not disputed by the defendants that the plaintiffs had obtained substantial loan from Canara Bank and the entire stock-in-trade within the business premises was hypothecated to Canara Bank and it was under the stipulation of the hypothecation deed that the plaintiffs were required to submit their monthly statements in respect of the stock in trade to the Bank duly certified and verified by it. The plaintiffs have adduced copies of the monthly statements bearing signatures of the bank officials. These are transactions which were maintained by the plaintiffs in regular course of business with the Bank and unless repudiated by cogent evidence, the presumption is that the entries made in the monthly statements are genuine and correct. The plaintiffs have demonstrated on the basis of these documents (Ext. 4 series) the quantity of stock which existed within the plaintiffs' premises prior to the date of burglary and stock which remained after the burglary and the value of stock of goods stolen away resulting in the loss sustained by the plaintiffs. The learned trial Court has rightly accepted the evidence adduced on this issue by the plaintiffs. The defendants have not been able to disprove the genuineness of those documents. Merely because the plaintiffs had not submitted such statement before the income tax/sales tax authorities, it cannot render the entries in the documents adduced by the plaintiffs in evidence as suspect. The findings of the learned trial Court on these issue is based on adequate reasonings and I find no infirmity, much less any illegality in the same. The trial Court has rightly drawn adverse inference against the defendants for their failure to examine the surveyor(s) or even to produce the report(s) submitted by the surveyors who had conducted enquiry into the claim of the plaintiffs.
14. As regards the rate of interest awarded by the trial Court, it appears that the plaintiffs had claimed interest at the rate of 19-1/2 per cent per annum from the date of burglary i.e. 28/29th December, 1984. The trial Court has admitted the claim and has awarded interest on the principal amount at the rate of 19-1/2 per cent per annum from the date of institution of the suit till realisation, though not from the date of occurrence of theft and burglary. The trial Court is competent to order for payment of interest as it may deem reasonable to be paid on the principal sum adjudged from the date of the suit to the date of decree with further interest at such rate not exceeding 6% per annum on such amount from the date of decree to the date of payment and where liability in relation to the sum was adjudged had arisen out of commercial transaction, the rate of such further interest may exceed 6 per cent per annum though it shall not exceed the rate at which the money are advanced by nationalised bank in relation to commercial transaction. In the instant case, the trial Court has deemed it reasonable to order for payment of interest at the rate of 19-1/2 per cent per annum on considering the nature of transaction between the parties and the liabilities of the defendants arising out of such transaction. There appears no anomaly in the rate except that such rate be payable from the date of institution of the suit till the date of judgment. As for the rate after the date of judgment till realisation, it is reduced to 12% per annum.
15. For the reasons aforesaid, I do not find any illegality in the findings of the trial Court on the relevant issues concerning the dispute between the parties. There is no merit in this appeal. The appeal is accordingly dismissed, with partial modification in the rate of interest as stated above.
