First Appeal No.

FA/74/2014
(Arisen out of Order Dated null in Case No. of District )

1. UNISON PHARMACEUTICALS
Chd. ...........Appellant(s)
Versus
1. National Insurance co.Ltd.
Through its Senior Divisional manager, Divisional Office
No. 133-135 Sector-17/C, Chandigarh
2. The Senior Divisionalmanager, National Insurance
Company Limited, Divisional Office no. 1, SCO No.
133-135
Sector-17/C, Chandigarh ...........Respondent(s)

BEFORE:
HON'BLE MR. JUSTICE SHAM SUNDER PRESIDENT
HON'ABLE MR. DEV RAJ MEMBER
HON'ABLE MRS. PADMA PANDEY MEMBER

PRESENT:

ORDER
STATE CONSUMER DISPUTES REDRESSAL COMMISSION,
U.T., CHANDIGARH

First Appeal No. : 74 of 2014

Date of Institution : 25.02.2014
Date of Decision : 24/04/2014
Unison Pharmaceuticals, through V.K.Uppal, Partner, Plot No.124, EPIP Phase-I,
Jharmajri Baddi (HP), having Head Office at 791, Industrial Area, Phase-II, Chandigarh.
…..Appellant/complainant
Versus
1. National Insurance Company Limited, through its Senior Divisional Manager,
Divisional Office No.SCO No.133-135, Sector 17-C, Chandigarh.
2. The Senior Divisional Manager, National Insurance Company Limited, Divisional
Office No.1, SCO No.133-135, Sector 17-C, Chandigarh.
....Respondents/Opposite Parties

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 Appeal under Section 15 of the Consumer Protection Act, 1986.
BEFORE: JUSTICE SHAM SUNDER (RETD.), PRESIDENT.
MR. DEV RAJ, MEMBER.
Argued by : Sh. Arun Kumar, Advocate for the appellant.
Sh. R.C. Gupta, Advocate for the respondents.
PER JUSTICE SHAM SUNDER (RETD.), PRESIDENT

This appeal is directed against the order dated 15.01.2014, rendered by the
District Consumer Disputes Redressal Forum-I, UT, Chandigarh (hereinafter to be called
as the District Forum only) vide which, it dismissed the complaint, filed by the
complainant (now appellant).

2. The facts, in brief, are that the complainant got insured its factory, as well as the
material lying in the same, from Opposite Party No.1, through Opposite Party No.2, for
the period from 06.04.2010 to 05.04.2011, vide Insurance Policy No.400100/46/10/
7500000005, for the Insured Declared Value, to the tune of Rs.3,98,00,000/-, on payment
of premium of Rs.19,943/- It was stated that the theft/burglary took place, in the factory
premises of the complainant, on the night intervening 29/30.10.2010. Locks, on the first
floor of the premises were found broken. Intimation, in this regard, was given to the
Police, on 30.10.2010. Intimation to Opposite Party No.2, was also given, on the
telephone, and through e-mail. It was further stated that the Police visited the spot, and
lodged DDR, with regard to the theft/burglary. Opposite Party No.2, also appointed the
Surveyor and Loss Assessor, for assessing the loss. The Surveyor and Loss Assessor,
visited the spot, took note of the situation and photographs as well. The complainant, on
demand, supplied the required documents to the Police, from time to time, with regard to
the loss suffered by it, to the tune of more than Rs.10 lacs. Thereafter, FIR No.16 dated
05.3.2011, under Sections 457/380 IPC, was registered, in Police Station Barotiwala,
District Solan (H.P.). It was further stated that all the requisite documents were also
supplied to the Surveyor and Loss Assessor. Non-traceable Report, in respect of the
theft/burglary, was also provided to the Opposite Parties.

3. However, the Opposite Parties, vide letter dated 12.09.2012, Annexure C-59,
illegally and arbitrarily, repudiated the genuine claim of the complainant. The
complainant requested the Opposite Parties, a number of times, to settle its claim, but to no
avail. It was further stated that the aforesaid acts of the Opposite Parties, amounted to

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deficiency, in rendering service, as also indulgence into unfair trade practice. When the
grievance of the complainant, was not redressed, left with no alternative, a complaint
under Section 12 of the Consumer Protection Act, 1986 (hereinafter to be called as the Act
only), was filed, directing the Opposite Parties, to pay the amount of Rs.10,52,386.30Ps,
alongwith interest @24% P.A., from the date of loss, till realization; compensation, to the
tune of Rs.5 lacs, for mental agony, physical harassment, deficiency, in rendering service,
and adoption of unfair trade practice; and cost of litigation, to the tune of Rs.50,000/-.

4. The Opposite Parties, in their joint written version, admitted that the
complainant got insured its factory, as well as the material lying in the same, from them,
for the period from 06.04.2010 to 05.04.2011, vide Insurance Policy
No.400100/46/10/7500000005, for the Insured Declared Value, to the tune of
Rs.3,98,00,000/-, on payment of premium of Rs.19,943/-. It was also admitted that the
theft/burglary was reported, by the complainant, in its premises, on the night intervening
29/30.10.2010. It was stated that FIR No.16 dated 05.03.2011, relied upon by the
complainant was registered after about 4-5 months of the alleged occurrence of
theft/burglary. It was further stated that, there was inordinate delay, in lodging the FIR,
which meant non-cooperation with the Opposite Parties, by the complainant, and
non-compliance of the terms and conditions of the Policy. It was further stated that, on
receipt of intimation, the Opposite Parties, appointed a Surveyor and Loss Assessor. It was
further stated that the complainant did not provide the documents, to the Surveyor and
Loss Assessor, asked for from it, and, as such, did not cooperate with it (Surveyor and
Loss Assessor).

5. It was further stated that, under these circumstances, the interim report dated
03.11.2010, was submitted by the Surveyor and Loss Assessor. It was further stated that,
thereafter, based on the available information and record, the Surveyor and Loss Assessor,
submitted his assessment report dated 03.03.2011, Annexure R-4, subject to acceptance of
the liability by the underwriters, as per the terms and conditions of the Insurance Policy. It
was further stated that the theft/burglary, was found to be the handiwork of the staff of the
insured, which was excluded under one of the exclusion Clauses of the Policy. It was
further stated that, as such, the claim of the complainant was legally and validly
repudiated, vide letter dated 12.09.2012 Annexure R-10. It was further stated that neither

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there was any deficiency, in rendering service, on the part of the Opposite Parties, nor they
indulged into unfair trade practice. The remaining averments, were denied, being wrong.

6. The Parties led evidence, in support of their case.

7. After hearing the Counsel for the parties, and, on going through the evidence,
and record of the case, the District Forum, dismissed the complaint, as stated above.
8. Feeling aggrieved, the instant appeal, has been filed by the
appellant/complainant.
9. We have heard the Counsel for the parties, and, have gone through the
evidence, and record of the case, carefully.
10. The Counsel for the appellant, submitted that, immediately after the theft,
burglary took place, in the premises of the complainant, on the night intervening
29/30.10.2010, Intimation through letter, copy whereof is Annexure C-5 dated 30.10.2010,
was given to the SHO, Barotiwala Police Station, Barotiwala, Himachal Pradesh, which
was received by him. He further submitted that, on that letter itself, an endorsement was
made by the said SHO, that ASI, Trilochan Singh, shall verify the facts and take necessary
action. He further submitted that, as such, there was no delay, on the part of the
complainant, in informing the Police, with regard to the theft/burglary of the stock, lying
in its premises. He further submitted that, if the Police registered FIR, on 05.03.2011,
though already information, with regard to the theft/burglary, had been given to it on
30.10.2010, then the fault did not lie, on the shoulders of the complainant. He further
submitted that when the Surveyor and Loss Assessor, inspected the spot, it found that the
main gate of the factory and office, at the ground floor, from where the entrance was
effected was open, whereas, at the first floor, kunda/bolt of the storeroom, where the stock
of raw material was lying, was found uprooted. He further submitted that this clearly
proved that there was a forcible entry, in the premises of the complainant, by way of
violent means. He further submitted that the theft/burglary was not the handiwork of the
staff of the insured. He further submitted that the Opposite Parties, illegally and arbitrarily,
repudiated the claim of the complainant, by invoking one of the exclusion Clauses of the
Policy. He further submitted that the Opposite Parties were deficient, in rendering service,
but the District Forum was wrong, in holding to the contrary. He further submitted that the
order of the District Forum, being illegal and invalid, is liable to be set aside.

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11. On the other hand, the Counsel for the respondents/Opposite Parties, submitted
that FIR was lodged, after four to five months, of the alleged theft/burglary. He further
submitted that this fact in itself spoke that there was non-cooperation, on the part of the
complainant, with the Surveyor and Loss Assessor, as also non-compliance and
non-observance of the terms and conditions of the Policy, by it. He further submitted that,
on receipt of information, with regard to the alleged incident of theft/burglary, Surveyor
and Loss Assessor was appointed, which submitted its final Survey report, on 03.03.2011,
on the basis of the available record, as the complainant did not cooperate with it, by
supplying it the complete documents. He further submitted that even the Surveyor and
Loss Assessor, came to the conclusion, that the alleged theft/burglary was the handiwork
of the staff of the insured/complainant, and, as such, the same was excluded under one of
the exclusion Clauses of the Policy. He further submitted that the claim of the complainant
was legally and validly repudiated by the Opposite Parties. He further submitted that the
order of the District Forum, being legal and valid, is liable to be upheld.
12. Admittedly, the complainant obtained the Burglary and Housebreaking
Policy (Business Premises), Annexure R-1, from Opposite Party No.1, through Opposite
Party No.2, for the period from 06.04.2010 to 05.04.2011, vide Insurance Policy
No.400100/46/10/7500000005, for the Insured Declared Value, to the tune of
Rs.3,98,00,000/- on payment of premium of Rs.19,943/-. It is also evident, from the
record, that the alleged theft/burglary took place, on the night intervening 29/30.10.2010.
It is evident, from Annexure C-5, copy of the letter, which was sent by the complainant,
to the SHO, Police Station Barotiwala, Himachal Pradesh, that information, with regard to
the said theft/burglary, was immediately given. If the Police did not record the FIR, on the
basis of the intimation, given vide letter Annexure C-5 dated 30.10.2010, then the fault did
not lie on the shoulders of the complainant. The Police have got its own ways, in
investigating the matters. No doubt, the Police could not investigate the matter, before
registration of the FIR, yet, it apparently indulged into such an activity, and that was why,
it, ultimately, registered the FIR, on 05.03.2011. It was the fault of the Police, in
registering the FIR, copy whereof is Annexure C-49, late. Had intimation Annexure C-5
dated 30.10.2010, with regard to the theft/burglary, been not given to the Police, the matter
would have been different. Under these circumstances, it could not be said that there was

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any delay, on the part of the complainant, in giving intimation with regard to the
theft/burglary, to the Police. The submission of the Counsel for the respondents/Opposite
Parties, in this regard, being devoid of merit, must fail, and the same stands rejected.
13. The next question, that falls for consideration, is, as to whether, there was a
forcible entry, by violent means, into the premises of the complainant, wherefrom, theft of
the stock was committed. Annexure C-5, copy of the intimation dated 30.10.2010, which
was given by the complainant, to the Opposite Parties, is the document, which came into
existence, first in point of time. This intimation was given by Mr. V.K. Uppal, Authorized
Signatory of the complainant. Vide this document, it was intimated by Mr. V.K. Uppal,
that, on the night intervening 29/30.10.2010, Mr. Ajay Kumar, Security Guard, Mobile
No.9805977189, was on duty, from 6 P.M. to 6 A.M. It was further intimated, vide this
document, that the staff of the complainant checked that Mr. Ajay Kumar, Security Guard,
was not found on duty. It was further intimated, vide this letter, that when they checked
the kitchen, two cylinders were found missing, and lock of the storeroom, where the raw
material was lying, was also found broken. From this intimation, it was, thus, proved that
Mr. Ajay Kumar, Security Guard was put on duty. Mr. Ajay Kumar, Security Guard, was
admittedly having both the keys of the premises, with him. Mr. Ajay Kumar, Security
Guard, was never produced before the Police, nor his affidavit was placed, on the record,
to prove that some persons from outside came to the premises of the complainant, and
after causing injuries to him, made a forcible entry to the same (premises), by violent
means, and committed theft of the goods/material, aforesaid. The Surveyor and Loss
Assessor, was appointed by the Opposite Parties, which gave its final Survey report
Annexure R-4. Under the heading “Incident Detail”, the said Surveyor and Loss Assessor,
mentioned as under:-
“The incident of the theft has been narrated by Mr. Anand Uppal, partner
stating:-
This is to certify that I Anand Uppal s/o Sh. V.K. Uppal R/o 956, Sec-9,
Panchkula, working partner of Unison Pharmaceuticals, 124, EPIP,
Jharmajri, Baddi state that on 30.10.2010 morning at about 7.30 my staff
from my factory called me at my residence and told me that the lock of the
raw material stock room has been broken & the main gate is open and

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watchman is missing. Than (then) I left for the factory & reached there about
9.00 am. On checking it was found that the main gate of the factory and
office from where the entrance is effected was open, watchman missing.
The keys of the main/office gate were with the watchman Ajay Kumar
& watchman has joined our company only 4-5 days back. The kunda of the
raw material store was found uprooted at first floor. However, there doesn`t
seen (seem) to be forcible entry from the main gate”
The incident of theft has been further confirmed by Mr. Arun Kumar,
working as manufacturing chemist with the insured stating that he handle all
the stock of raw material. On 30.10.2010 morning, when he came for duty at
9.00 am, his staff told him that the lock of the raw material stock room has
been broken and when he confirmed, found that raw material of around 10
lacs was missing from the stock in drums of 5 and 25 kg (Aluminum and
Corrugated) besides this the stock in the aluminum bags have been found to
be missing. In addition to above on further checking found that 1 laptop
(Zenith made) lying in our raw material store was also found to be missing
and L.P.G. cylinder lying in the chowkidar room was also missing.
He further stated that the main gate lock was opened; watchman Ajay
Kumar was missing & the keys of the main gate were stated to be lying
with him.
As stated by him, the unit is located at two floors besides ground floor,
basement & the loss has taken place to stock lying at 1 st floor. The entry to
the 1 st and 2 nd floor is through the office inside the main gate. The
office gate was also found to be open as the keys of the office gate was
also with the watchman. No wall of the factory/gate has been damaged
& broken & the loss has taken place only at raw material store situated
at first floor. The average stock value held in the factory is to the tune of
Rs.3.5 crores on an average. In all probability the incidence of burglary
seems to be handy work of watchman but the same is subject to final
investigation of Police Authority ”.

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14. It was also stated, in the report, aforesaid, that the insured unit is a triple story
building, and the incident of loss took place, in respect of the raw material, from the store,
located at the first floor. The entry to the first and second floor was through the stairs, via
door in the office. The main iron gate/office door was found to be open, and no main gate
door lock/office door was found to be damaged/broken, except that the kunda/bolt of the
raw material store, at the first floor, was found to be uprooted and the lock was intact. The
insured premises were covered with a boundary wall of 6 feet height, from all four sides,
and no damage was found to have been caused to the boundary wall. Ultimately, the
Surveyor and Loss Assessor, came to the conclusion that there did not seem to be any
element of force/forcible entry, to the insured premises, as both the doors (main gate and
entry gate) of the office were found to be open, and keys were with Mr. Ajay Kumar,
Security Guard. The Surveyor and Loss Assessor, also came to the conclusion, that in
all probabilities, the incident of theft, appeared to be the handiwork of insured`s own staff
(watchman). He further submitted that since the alleged theft/burglary was a handiwork of
the insured own staff, its (insured) case, fell under one of exclusion Clauses of the Policy.
It is, no doubt, true that the report of the Surveyor is neither binding on the parties, nor the
Consumer Foras, yet, it being a very significant and material document, cannot be
discarded lightly. Cogent and convincing evidence, is required to be produced by the party
to challenge the correctness thereof. No cogent and convincing documentary evidence
was produced by the complainant, to rebut the findings, recorded by the Surveyor and
Loss Assessor, that the theft/burglary, was the handiwork of its staff. As stated above,
had the affidavit of Mr. Ajay Kumar, Security Guard, been produced, and he had stated
therein, that there was a forcible entry into the premises, in question, by some unknown
persons, or had damage to the main entry gate of the ground floor of the premises and
office door been found, the matter would have been different. Since, the main entry gate
of the ground floor and the office door of the first floor were found to be open, and both
the keys thereof were with Mr. Ajay Kumar, Security Guard, the Surveyor and Loss
Assessor was right, in coming to the conclusion, that it was the handiwork of the staff of
the complainant. Under these circumstances, no theft or burglary was committed by any

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outsider. The District Forum, was also right in holding so. Under these circumstances, it is
to be seen, as to whether, the claim filed by the complainant, fell under one of the
exclusion Clauses or not.
15. The parties are governed, by the terms and conditions of the Insurance Policy,
and while construing the same, the Consumer Foras cannot add, subtract or delete any
words therefrom. It was held by the Hon`ble Supreme Court, in Export Credit
Guarantee Corporation of India Ltd. v. Garg Sons International, II (2013) CPJ 1 (SC) =I
(2013) SLT 614, as under:-
“It is a settled legal proposition that while construing the terms of a
contract of insurance, the words used therein must be given paramount
importance, and it is not open for the Court to add, delete or substitute
any words. It is also well settled, that since upon issuance of an insurance
policy, the insurer undertakes to indemnify the loss suffered by the
insured on account of risks covered by the policy, its terms have to be
strictly construed in order to determine the extent of the liability of the
insurer. Therefore, the endeavour of the Court should always be to
interpret the words used in the contract in the manner that will best
express the intention of the parties”.
16. Annexure R-11, contain the terms and conditions of the Policy, in question. As
stated above, it was Burglary and Housebreaking Policy (Business Premises). Exclusion
No.2, under the Exclusions Clauses, of the said Policy, reads as under:-
“The Company shall not be liable in respect of :
1 ……………
2. Loss or damage where any inmate or member of the Insured’s
household or of his business staff or any other person lawfully in the
premises in the business is concerned in the actual theft or damage to any
of the articles or premises or where such loss or damage have been
expedited or any way assisted or brought about by any such person or
persons.”
17. As stated above, the parties are governed by the terms and conditions,
exclusions, warranties, etc., contained in the Policy. Since, it has been held above, that the
theft of stock was the handiwork of the staff of the complainant, the loss or damage was

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excluded under Exclusion Clause No.2, extracted above. Under these circumstances, the
repudiation of claim of the complainant, on the basis of Exclusion No.2, referred to above,
was legal and valid.
18. The District Forum, was thus right, in holding that the Opposite Parties, were
neither deficient, in rendering service, nor indulged into unfair trade practice. The order of
the District Forum, being legal and valid, is liable to be upheld.

19. No other point, was urged, by the Counsel for the parties.
20. In view of the above discussion, it is held that the order passed by the District
Forum, being based on the correct appreciation of evidence, and law, on the point, does
not suffer from any illegality or perversity, warranting the interference of this
Commission.
21. For the reasons recorded above, the appeal, being devoid of merit, must fail,
and the same is dismissed with no order as to costs. The order of the District Forum is
upheld.
22. Certified copies of this order, be sent to the parties, free of charge.
23. The file be consigned to Record Room, after completion.
Pronounced.

[HON'BLE MR. JUSTICE SHAM SUNDER]

PRESIDENT

[HON'ABLE MR. DEV RAJ]

MEMBER

[HON'ABLE MRS. PADMA PANDEY]

MEMBER

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