BHARAT WATCH COMPANY THROUGH ITS PARTNER versus NATIONAL INSURANCE CO. LTD. THROUGH ITS REGIONAL MANAGER

Citation: [2019] 6 S.C.R. 302 · Decided: 12-04-2019 · Supreme Court of India · Bench: D.Y. CHANDRACHUD · Disposal: Appeal(s) allowed

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Judgment (excerpt)

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302
SUPREME COURT REPORTS
[2019] 6 S.C.R.
BHARAT WATCH COMPANY THROUGH ITS PARTNER
v.
NATIONAL INSURANCE CO. LTD. THROUGH ITS REGIONAL
MANAGER
(Civil Appeal No.3912 of 2019)
APRIL 12, 2019
[DR. DHANANJAYA Y CHANDRACHUD AND
HEMANT GUPTA, JJ.]
Insurance:
Insurance policy – Exclusionary clause – Non-communication
of, to the insured – Effect of – Insurance claim – For theft/burglary
of shop – Claim was repudiated by the insurer  in view of the terms
of exclusion in the policy – Consumer complaint allowed by District
Forum as well as by the State Commission in appeal, on the ground
that exclusion would not be binding on the insured because the
terms and conditions of the exclusion were not communicated to the
insured – National Commission, relying on the exclusion clause,
rejected the claim of the insured – In appeal, held: Terms and
conditions of the exclusionary clause would have been attracted if
the same were communicated to the insured – In absence of such
communication, the exclusionary clause are not attracted in the
present case – Order of National Commission is liable to be set
aside – Appeal allowed.
United India Insurance Co. Ltd. v. Harchand Rai
Chandan Lal (2004) 8 SCC 644 :  [2004] 4 Suppl.
 SCR 662 – distinguished.
Case Law Reference
[2004] 4 Suppl. SCR 662
distinguished
Para 6
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 3912
of 2019.
From the Judgment and Order  dated  16.04.2015 of the National
Consumer Disputes Redressal Commission, New Delhi in Revision
Petition No. 3836 of 2010.
   [2019] 6 S.C.R. 302
302
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303
Sudhanshu S. Choudhari, Ms. Surabhi Guleria, Yogesh Kalte, Ms.
Nandini Singla, Advs. for the Appellant.
Vishnu Mehra, Anant Mehrotra, Ms. Sakshi Mittal,  Advs. for the
Respondent.
The Judgment of the Court was delivered by
DR. DHANANJAYA Y. CHANDRACHUD, J.
1. Leave granted.
2. The National Consumer Disputes Redressal Commission1 by
its judgment dated 16 April 2015 reversed the concurrent findings arrived
at by the District Consumer Disputes Redressal  Forum, Solapur2 and
by the Consumer Disputes Redressal Commission, Maharashtra3.
3. The appellant has a showroom at Solapur in which watches
are sold. The appellant had insured its stock of watches with the
respondent. During the course of the night on 3 August 2001, after the
shop had closed for the day, a theft occurred in the premises.  The theft
was detected at about 9 A.M. on the next day after the shop opened for
business.
4. A First Information Report was lodged with the Police and a
claim under the insurance policy was made.  The surveyor submitted a
preliminary report on 4 September 2001 indicating a loss of approximately
Rs 3,86,395.   The surveyor recorded that they were informed by the
partner of the firm that the theft may have taken place by utilising duplicate
keys.   The surveyor, however, found empty watch stands on which the
strips of the model numbers were lying behind the counters.  There was
no sign of forcible entry.  This was followed by a surveyor’s report
dated 30 November 2001.
5. After the claim was repudiated by the insurer, the appellant
filed a consumer complaint. By an order dated 26 April 2007, the District
Forum allowed the claim in the amount of Rs. 3,04,000. The decision of
the District Forum was affirmed, in appeal, by the SCDRC on 19 April
2010.
6. The NCDRC reversed the above decisions in its revisional order
dated 16 April 2015, relying upon a decision of this Court in United
1 “NCDRC”
2 “District Forum”
3 “SCDRC”
BHARAT WATCH CO. THR. ITS PARTNER v. NICL THR. ITS
REG. MANAGER
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SUPREME COURT REPORTS
[2019] 6 S.C.R.
India Insurance Co. Ltd. vs. Harchand Rai Chandan Lal4 .
Construing the terms of the exclusion in a policy of insurance against
burglary and/or house breaking, this Court had held that where the loss
or damage was caused without forcible and violent entry to and/or exit
from the premises, the claim could not be maintained.  The terms of the
policy in the above decision of this Court read as follows:
“’Burglary and/or housebreaking’ shall mean theft involving entry
to or exit from the premises stated therein by forcible and violent
means or following assault or violence or threat thereof to the
insured or to his employees or to the members of his family.”
7. Construing the above condition, this Court held:
“15….we are of the opinion that theft should have been preceded
with force or violence as per the terms of insurance policy.   In
order to subst

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