ALLIANZ GENERAL INSURANCE CO LTD & ANR versus THE STATE OF MADHYA PRADESH

Citation: [2020] 6 S.C.R. 198 · Decided: 24-04-2020 · Supreme Court of India · Bench: D.Y. CHANDRACHUD · Disposal: Appeal(s) allowed

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Judgment (excerpt)

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SUPREME COURT REPORTS
[2020] 6 S.C.R.
BAJAJ ALLIANZ GENERAL INSURANCE CO LTD & ANR
v.
THE STATE OF MADHYA PRADESH
(Civil Appeal No. 2366-67 of 2020)
APRIL 24, 2020
[DR. DHANANJAYA Y CHANDRACHUD AND
AJAY RASTOGI, JJ.]
Consumer Protection Act, 1986: Deficiency in service –
Insurance policy – Respondent purchased a “Transit Marine
Insurance Policy” from the appellant-insurer on 21 July 2005, to
cover the transportation of Helicopter from Langley, Canada to
Bhopal, India – As per the acceptance letter, the transit route for
the transportation of the helicopter was ‘Langley to Bhopal (by
road/by air)” – On 5 October 2005, the helicopter was transported
in a knocked down condition by air to New Delhi – On 13 October
2005, the helicopter was cleared by the customs and was shifted to
a hangar at New Delhi – On inspection, the window of crew door
was reported to be damaged – By letter dated 22 October 2005, the
respondent informed insurer of the damage and stated that the
helicopter was “being assembled at the Hangar located at Delhi so
that the Helicopter can fly from Delhi to Bhopal” – On 23 November
2005, the respondent informed insurer that upon inspection, the
tail boom of the helicopter was found damaged – A surveyor was
appointed by the appellant to assess the alleged damage – In the
report, surveyor concluded that the damage to the tail boom had
occurred at Hangar Delhi after substantial assembly but prior to
test flight and not during transit and hence would not fall under the
purview of marine insurance policy as issued to the insured –
Whether storage, unpacking and assembly of the helicopter at New
Delhi would fall outside the scope of the expression “ordinary
course of transit”, terminating coverage under the policy – Held:
The insurance cover in the instant case is expressed in terms of the
voyage itself – It provided that policy commenced from the time the
insured cargo left the warehouse, premises or place of storage at
the place named in the policy and continued during the “ordinary
course of transit” – The specific act of unpacking the cargo at New
[2020] 6 S.C.R. 198
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Delhi for assembling it for the flight to Bhopal indicated that the
transportation of the cargo in a knocked down state had come to
an end – Once the respondent decided to leave the goods in the
hangar at New Delhi for its commercial convenience not associated
with or in furtherance of the requirements of their carriage to
Bhopal, the transit insurance ended – The act of assembling the
helicopter with a view to having it flown under its own power,
instead of transporting the packaged knocked down helicopter
further to Bhopal by road, would not constitute as storage in the
ordinary course of transit – The policy covered only those risks
that were associated with the transportation of the helicopter and
did not cover the risks associated with the flight or operation of the
helicopter – Change in the character of the helicopter from a
knocked down state to a ready to fly state exposed insurer to risks
not contemplated by the parties under the policy – Nature of the
subject-matter having been altered, the cargo could not be said to
be in transit and insurer was absolved from any liability arising out
of any subsequent damage to the consignment.
Insurance Policy – Expression “in the ordinary course of
transit”, meaning of – Held: Expression “in the ordinary course of
transit” depends on the context, object and the wording of the
particular policy – In context of the policy, the words “in transit”
do not require transportation of the consignment in a single trip
from the commencement to the final destination but includes those
interruptions in motion that are incidental to or in furtherance of
the conveyance or transportation of the consignment – The question
of what does and does not constitute a deviation in furtherance of
the conveyance of the goods is a question of fact that must be
determined by both the intent of the policy and the actions of the
parties.
Insurance Policy – Burden of proof – For the respondent to
prove its case, a mere assertion that the loss incurred during the
course of transit is not sufficient – Burden of proof lies on the
respondent to show that the loss incurred was covered within the
terms of the policy and that on a balance of probabilities there
existed a proximate cause between the loss incurred and the
consignment being in transit.
BAJAJ ALLIANZ GENERAL INSURANCE CO LTD v.

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