Dismissed

M/S.Maniklal Commodities P.Ltd. v. the Oriental Fire and General Insurance Co.Ltd.

Bombay HC4 Aug 2005S/2374/1984

Case brief

AI extract

What is this about?

This civil judgment addresses a suit for insurance recovery following theft of soap raw material. The court held that the plaintiff breached the special watchman warranty by failing to provide guards during the night shift (11.30 p.m. to 8.30 a.m.), even though they provided guards for the rest of the day. Consequently, the defendant insurance company was discharged from liability.

What did the court decide?

Both suits were dismissed; the defendant is not liable to make any payment towards the insurance claim.

M/S.Maniklal Commodities P.Ltd. Vs the Oriental Fire and General… — Insurance | Bombay HC (2005)

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 IN THE HIGH COURT OF JUDICATURE AT BOMBAY

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 ORDINARY ORIGINAL CIVIL JURISDICTION

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 SUIT NO. 2661 OF 1984

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 M/s. Hasmukhrai Chandrakant ......Plffs.
 vs.

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 The Oriental Fire and General
 Insurance Co.Ltd .....Defnds

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 A L O N G W I T H
 SUIT NO. 2374 OF 1984

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 M/s. Manilal Commodities P.Ltd ......Plffs.
 vs.

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 The Oriental Fire and General
 Insurance Co.Ltd .....Defnds

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 M.S. Singhvi, Sr. Counsel with R.C. Shah i/b.
 M/s. Desai and Diwanji for the plaintiffs.

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 M.P.S. Rao with Ms. R. Tawde i/b. M.V. Kini and
 Co. for the defendants.

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 CORAM: S.U. KAMDAR, J.
 DATE : 4TH AUGUST, 2005.

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 JUDGMENT :

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 1. The present suit being Suit No. 2661 of 1984

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 has been filed against the insurance company for
 the recovery of sum of Rs.18,70,322.42/- with
 further interest on the principal amount of
 Rs.15,85,019/- at the rate of 18% p.a. from the

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 date of the suit till payment and or realisation.

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 The said claim has been made on the basis of
 insurance policy obtained by the plaintiff from the
 defendant company. Some of the material facts of
 the present case can be briefly enumerated as under
 :

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 2. Some time in or about March, 1981 the
 plaintiff entered into an agreement for purchase of
 2674 drums of soap raw material from one Manilal
 Holdings SDN. BRD of Penang. Pursuant to the said
 contract the said goods were shipped by the said
 company via the ship known as ‘Speed Success’. The
 port of discharge for the said cargo was Bombay.
 On 28.3.1981 the said ship ‘Speed Success’ arrived
 at Bombay. However since no berth was available
 the said goods were unloaded in lighters from time
 to time between 9.4.1981 to 9.5.1981 and
 transported to the Bombay Port. The said goods
 could not be cleared immediately because of certain
 investigations undertaken by the customs authority.
 In view of the customs investigation the said goods
 were removed from Princess Dock to Hay Bunder Area
 till its final clearance.

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 3. It is the case of the plaintiff that the

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 plaintiff applied for the insurance of the said

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 goods because they were immediately not available
 for clearance and the plaintiffs were interested in
 covering the risk of loss by fire, theft and
 burglary by taking out necessary policies. It is
 the case of the plaintiff that accordingly on
 25.9.1981 the plaintiff addressed a letter to the
 defendants and requested the defendants to provide
 insurance cover to the said 2674 soap raw material
 weighing approximately 507.748 metric tones and
 which were laying at Hay Bunder area. According to
 the plaintiff the value of the said goods was
 around Rs.41,70,000/-. Thus the plaintiff took
 insurance policy of the said goods for sum of
 Rs.41,70,000/-for a period of two months commencing

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 from 25.9.1981. The plaintiff also furnished the
 necessary shipping marks inrespect of the said 2674

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 drums and paid the premium amount as demanded by
 the defendant for the said insurance policy. The
 plaintiff thereafter filed the necessary proposal
 form. The plaintiff has mentioned in the said

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 proposal form that they will engage watchmen to

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 guard the goods day and night. The proposal of the
 plaintiff was accepted by the defendants and the
 defendants issued a cover note. This cover note
 dated 27.9.1981 insured the said goods against the
 perils of theft and burglary on various terms and
 conditions set out therein. The said insurance
 policy was valid for a period of two months from
 27.9.1981 to 24.11.1981.

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 4. On 30.9.1981 the defendants issued a regular

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 insurance policy to the plaintiff insuring the said
 goods as per the aforesaid cover note. According
 to the plaintiff the said policy also covered the
 risk of theft and towards the said coverage of the
 said risk the defendant demanded extra premium of
 Rs.500/- for each and every claim. It is the case
 of the plaintiff that the plaintiff has paid the
 said extra premium to cover the said risk of theft
 also inrepsect of the said goods. It is an
 admitted position that the said insurance policy
 had an additional slip appended which inter-alia
 provided for a special watchmen warranty.

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 5. It is the case of the plaintiff that

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 subsequently by an endorsement the period of the

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 said insurance cover was extended and the policy
 was renewed for a further period of two months from

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 25.11.1981 to 24.1.1982 and for the
 extension/renewal of the said policy the plaintiff
 paid the additional premium amount of Rs.4,117/- to
 the defendants. Thus according to the plaintiff
 the insurance policy stood validated upto 25.2.1982
 in their favour. The renewal of the said policy
 was on the same terms and conditions as prescribed
 in the original policy.

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 6. It is the case of the plaintiff that the goods
 which were imported by him were lying in the open
 at Hay Bunder Port Trust, Bombay and in order to
 protect the said goods against any chance of theft
 and burglary the plaintiffs through their clearing
 agents engaged two watchman for two shifts i.e.
 from 8.30 a.m. to 4.30 p.m. and from 4.30 p.m.
 to 11.30 p.m.every day to watch the goods. It is
 the case of the plaintiff that though the said

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 goods were lying in the enclosed premises of the

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 Bombay Port Trust the Bombay Port Trust did not

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 allow the watchmen of the private parties to guard
 their goods between 11.30 p.m. to 8.30 a.m. It is
 further the case of the plaintiff that during the
 night time the Bombay Port Trust itself was
 providing for security and there has been a mobile
 police patrol who takes round of the dock area. It
 is further the case of the plaintiff that after the
 customs formalities were over and the customs

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 authority permitted the clearance of the said goods
 some time in or about 21.1.1982 the plaintiff found
 on taking inspection that out of 2674 drums 1050

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 drums were missing and were not available for
 delivery. In view of the aforesaid the plaintiff
 could take delivery of the balance drum of only
 1080 drums. By letter dated 21.2.1982 the
 plaintiff informed the defendant that there has
 been a theft and short delivery of 1051 drums and
 thus they are lodging the claim under the said
 insurance policy and filing their detailed claim
 after making necessary inquiries in the matter.
 Accordingly the plaintiff lodged the claim for a

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 less delivery of 1051 missing drums valuing at
 Rs.16,50,000/-. On 23.2.1982 the plaintiff also
 informed the police Inspector, Sewree Police
 station about the loss of 1051 drums out of total
 2674 drums and requested the police to record their
 complaint and investigate the matter at the
 premises. It is further the case of the plaintiff
 that the defendant thereafter asked the plaintiff
 to fill up the claim form and forward the same to
 the defendants. On 5.4.1982 the port trust
 authority addressed a letter to the plaintiff and
 confirmed that inrespect of the items no. 9 and 10
 of IGM no. 2668 Ex.ss ‘Speed Success’ about the
 manifested quantity of 1830 drums the plaintiff
 could take delivery of 1623 drums. Thus there was
 a shortage of 190 drums. It is the case that the
 port trust authority also confirmed that no more
 drums were available for delivery. Similarly
 inrespect of IGM Manifest Item no. 4 and 5 the
 authority informed the defendant that the entire
 quantity of 861 drums covered thereunder were lost
 and not a single drums are available for delivery
 at Hay Bunder. It was also informed that the said

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 Shed Superintendent has lodged a report of theft

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 and the said drums have been pilfredged.
 Ultimately the plaintiffs filed their claim for the
 entire lost drums on 25.6.1982 pointing out that
 the said drums have been lost on the various dates

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 unknown to them and that the same had been
 discovered by them at the time of taking delivery
 on 24/25.1.1982. By the said claim the plaintiff
 has claimed the loss suffered for 1051 drums of
 soap raw material aggregating to 193.295 metric
 tones at the rate of 8200 per tonne and aggregating
 amount claimed is Rs.15,85,019/-. The defendants
 thereafter asked for various particulars and it is
 the case of the plaintiff that they have furnished
 the same by their letter dated 6.8.1982. It is
 further the case of the plaintiff that on
 15.12.1982 the defendant informed the plaintiffs
 that they have entrusted the work to the surveyors
 V.K. Neelkanth and Co. for making a survey and
 prepare a report for the goods lost and to carry
 out comprehensive investigation. It is the case of
 the plaintiff that surveyor thereafter carried out
 investigation. Further it was fairly mentioned by

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 the surveyor that because there was no watchman at
 night time i.e. from 11.30 p.m. to 8.30 a.m. the
 said goods have been lost and that the theft has
 been committed in the night time. It is the case
 of the plaintiff that the surveyor further gave a
 report that there has been a breach of the warranty
 which is appended to the said policy being watchman
 warranty and therefore the defendant should not
 make payment of the said claim. The defendant
 accordingly rejected the claim of the plaintiff.
 Thereafter the plaintiff by the letter dated
 16.4.1993 pointed out that it was not possible to
 employ the watchman at the night time because of
 the policies of the Bombay Port Trust and thus the
 plaintiff cannot be held responsible for any such
 theft and the defendant company must make payment
 of the aforesaid amount. By letter dated 17.4.1993
 the defendants once again rejected the claim of the
 plaintiff and refused to entertain the same and
 thus the plaintiffs after considerable
 correspondence has filed the present suit for the
 recovery of the said amount of Rs.15,81,019/-.

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 7. The defendants have filed written statement
 and has resisted the claim of the plaintiff. The
 defendants have submitted in the present written
 statement that on true and correct interpretation
 of the policy the policy did not cover the risk of
 the theft and it is only house breaking and
 burglary policy. Secondly it has been contended
 that the said policy was based on special warranty
 of watchman and the defendants have committed a
 breach of the said watchman warranty and therefore
 the plaintiffs are discharged from making payment
 of any liability thereof. Inrepsect of the other
 averments the defendants have put the plaintiffs to
 the strict proof thereof and has not admitted that
 either the Port trust does not permit the watchman
 for the night or that the said premises has been
 duly safeguarded by the mobile patrol police van in
 the night time. They have further reiterated the
 report of the surveyors M/s. V.K. Neelkanth who
 has opined that in all probabilities the loss of
 the cargo has taken place during the night time
 when the watchman was not available in breach of
 the watchman warranty and thus the defendants has

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 reiterated that the claim of the plaintiff cannot
 be entertained. In the aforesaid circumstances the
 defendants have contended that the present suit is
 liable to be dismissed.

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 8. The plaintiff has also filed a connected suit
 being Suit No. 2374 of 1984. In the said suit the
 plaintiff has claimed an amount of Rs.2,05,867.82/-
 with further interest on the principal amount of
 Rs.1,74,464.30/- at the rate of 18% p.a.. The said
 suit is inrepsect of other consignment of 2631
 drums containing 499.890 M.T. of 1000 kgs. each
 of soap raw material. The said goods also arrived
 by the same vessel and were unloaded during the
 same period. Inrespect of the said cargo the
 plaintiff has also taken out separate policies. It
 is an admitted position before me and even
 established on evidence that the terms and
 conditions of both the policies which is the
 subject Matter of the suit in the first matter and
 subject matter in the second matter are identical.
 In this suit there has been a loss of cargo of
 about 112 drums and thus the plaintiff has lodged

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 the claim for the aforesaid amount of Rs.

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 1,74,464.30/- with the defendant and the defendant
 having rejected the said claim as well inrespect of
 this consignment the plaintiffs have filed the
 second suit No. 2374 of 1984 has been filed in
 this court. The defendants have raised the
 identical defence in the second suit.

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 9. In view of the aforesaid position both the
 parties before me have agreed that the decision in
 the first suit being Suit No. 2661 of 1984 must
 also govern the decision in the second suit being
 Suit No. 2374 of 1984. Both the parties have led
 common evidence and common compilation of documents
 has been filed in this court. On the aforesaid
 pleadings the issues were framed. Issues in Suit
 No. 2661 of 1984 are as under :

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 1 Whether the plaintiff proves that it
 is entitled to receover from the defendants a
 sum of Rs.18,70,322.42/- with further interest
 on Rs.15,85,019/- at the rate of 18% p.a.
 from the date of the suit till payment and or
 realization, being the amount of insurance
 payable to the plaintiff ?

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 2. Whether the plaintiff proves that the
 insurance contract was complete and that the
 said contract did not contain the said
 watchman warranty ?

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 3. If the aforesaid Issue No.2 is
 answered in negative, then whether the
 defendants prove that the said watchman
 warranty required the plaintiff to appoint
 private security guards ?

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 4. If the issue no.2 is answered in the
 negative, then whether the defendants prove
 that private watchman were allowed to be kept
 by the B.P.T. authorities duriong the third
 shift i.e. from 11.30 p.m. to 8.30 a.m. ?

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 5. If the above Issue No.2 is answered in
 negative, then whether the defendants prove
 that theplaintiff had fundamentally breached
 the said watchman warranty clause of teh
 Insurance Policy by not keeping its own
 private watchman during the third shift i.e.
 from 11.30 p.m. till 8.30 a.m., thereby
 entitling the defendants not to pay the
 plaintiffs in part or at all ?

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 6. Whether the plaintiff proves that the
 said watchman warranty clause is inconsistent
 with the object of the contract and is void ?

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 7. If the Issue No.2 is answered in
 negatives, whether the plaintiff proves that
 the said clause would not be applicable for
 the reasons as set out in para 8 of the plaint
 ?

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 8. Whether the Defendants prove that the
 plaintiff’s claim is barred by the law of
 limitation ?

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 9. What order ?

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 10. Issues in the other suit except to the extent
 of quantity and the claim amount are also identical
 as in the first suit. On the aforesaid issue
 common evidence is led before me and the plaintiff
 has examined three witnesess. The first witness
 being P.W.No.1 was one Mr. Hasmukhrai being the
 partner of the plaintiff firm. The said witness
 has given his examination-in-chief by affidavit
 dated 20.10.2004 and thereafter filed additional
 affidavit of evidence dated 22.6.2005. The
 plaintiff has also led the evidence of Kirit
 Laxmichand Lapasia who was a clearing agent for the
 plaintiff at the relevant time for the release of
 the said goods. The plaintiff has thereafter led
 the evidence of S.S. Shiralkar who at presently is
 the Dock Manager at Mumbai Port Trust.

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 11. The plaintiff has also filed various
 documentary evidence in the form of compilation
 Ex.P.1 to Ex.P.22 on record. The defendants have
 also led the evidence of one witness namely Bindore
 Dinkar who is the Senior Dock Manager of the
 defendant company. The defendants have also filed

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 the compilation of documents and have filed

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 exhibits from D-1 to D-8. In so far as the

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 documents are concerned there is no dispute between
 the parties. Though the plaintiff is unable to
 produce the original insurance policy inrespect of
 the first suit being Suit No. 2661 of 1984 but the
 plaintiff has relied upon a cover note being cover
 note dated 27.9.81 as well as the receipt of the
 payment towards the insurance premium. The
 plaintiff has relied upon the insurance policy
 which is admittedly similar to the one issued in
 the first matter and now not traceable. The
 plaintiff has further produced the insurance policy
 dated 22.1.1982 which is an insurance policy
 inrespect of the second suit consignment. Both the
 parties have agreed before me that both the
 policies were infact issued and were of identical
 terms. Though initially the defendants had sought
 to contest that the defendants having failed to
 produce the original insurance policy in the first
 suit the same should be dismissed. However
 subsequently inview of the evidence of the witness
 of the defendant in which he has admitted that the

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 policy was issued in the first suit also to the
 plaintiff inrespect of the first consignment and
 the terms and conditions of the said policy were
 identical to the house breaking and burglary policy
 which is also a policy in the second consignment
 the said plea has been given up.

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 12. The evidence led before me essentially
 pertains to the procedure under which the said
 cargo is delivered at the port, the method and
 manner in which the cargo is stored and at what
 point of time the cargo was cleared and the loss of
 the defendants ascertained by the plaintiffs. The
 documentary evidence produced before me are in the
 form of correspondence also in the form of
 insurance policy and other evidence to show that
 the insurance policy was obtained by the plaintiff
 from the defendants herein.

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 13. Essentially the suit is contested by the
 defendants on two basic grounds namely that infact
 the policy which has been issued on its true and
 proper interpretation is not a policy covering the

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 risk of theft and it is merely a policy for house
 breaking and burglary. It has been contended that
 once the insurance policy did not cover the risk of
 theft and admittedly the goods are lost by virtue
 of theft from the dock area the defendants are not
 liable to make payment of the said insurance amount
 as claimed by the plaintiff. Alternatively it has
 been contended that assuming that, if such a risk
 is also covered by the insurance policy then in
 that event admittedly the policy had a super
 imposed condition specially attached to both the
 policy being a warranty of watchman from the
 plaintiff to safeguard and protect the said goods.
 It has been contended that the said watchman
 warranty applied round the clock for 24 hours and
 infact the plaintiffs themselves in the proposal
 form gave an assurance that they will provide for
 watchman in the night as well as day time. Since
 there is a breach of the said warranty as
 admittedly the defendants have not provided for the
 watchman in the night the defendants liability
 under the insurance policy cease to exist and the
 defendant cannot be made liable to make payment of

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 the insurance claim under the said policy.

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 14. On the other hand the learned counsel for the
 plaintiffs has repudiated the aforesaid conditions
 by contending that infact the policy included the
 coverage of risk of theft and though the printed
 terms and conditions of the said policy only
 provides for house breaking and burglary but by
 virtue of the additional terms imposed in the said
 policy the defendants have also covered the risk of
 theft in so far as the suit policies are concerned.
 It has been also contended that infact by charging
 extra premium of Rs.500/- the defendants have
 covered the risk of theft inrpesect of the said
 goods and therefore it is not open for the
 defendant to now contend that the policy does not
 cover the risk of theft. In so far as the warranty

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 for watchman is concerned. Learned counsel for the
 plaintiffs has contended that the said warranty of
 watchman does not apply to the risk covered by
 theft as it only applies to the risk of burglary.
 Secondly it has been contended that assuming such a
 condition is applicable to the said policy even

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 inrespect of the risk covered by theft then in that
 event the plaintiffs has complied with the said
 conditions because the plaintiff has provided for
 watchman from 8.30 a.m. to 4.30p.m. and 4.30p.m.
 to 11.30p.m. i.e. day and night as mentioned by
 them in their proposal. Non providing of the
 watchman during 11.30 p.m. to 8.30 a.m. according
 to the learned counsel for the plaintiffs is
 irrelevant because once the watchman is provided
 during 11.30p.m. in the night time it means
 providing of watchman both day and night and no
 watchman is required from 11.30 p.m. to 8.30 a.m.
 Alternatively the learned counsel for the
 plaintiffs have submitted that in any event there
 is a substantial compliance of the warranty of
 watchman because during the major part of the day
 the watchman is provided and during 11.30p.m. to
 8.30 a.m. the plaintiff cannot provide for a
 watchman because the port trust authorities were
 not permitting such providing for a watchman during
 that time. It has been contended that by leading
 evidence of the Deputy Dock Manager of the Docks
 the plaintiffs have established that the port trust

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 authority was not permitting the watchman to be
 employed during the period from 11.30 p.m. to 8.30
 a.m. and thus for non-providing of the watchman at
 that time the plaintiff cannot be faulted with. In
 any event there was a watchman of the port trust
 and the goods were patrolled by the police during
 that period also and thus there is a substantial
 compliance of the said watchman warranty and
 therefore the defendants are liable to make payment
 of the insurance amount covered by the said policy
 in favour of the plaintiff herein.

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 15. The third contention which has been advanced

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 by the learned counsel for the defendants that it
 is not possible to ascertain when the goods were
 lost in the port and it could be that the goods
 were already lost prior to the taking out the
 policy on 13.9.1981 because admittedly the goods
 are landed sometime in April/May 1981. However the
 learned counsel for the plaintiff has rightly
 pointed out that there is no substance in the
 aforesaid contention because there is no pleadings
 of any such nature nor it has been contended that

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 there was misrepresentation by the plaintiff while
 obtaining the policy because the goods were already
 lost before applying for the policy. If it was so
 the defendant was required to raise such contention
 in the written statement and seek avoidance of the
 policy on such ground. The fact that the policy
 was obtained fraudulently and/or on the basis of
 false representations is required to be
 specifically pleaded and proved. There is no such
 plea and no such evidence and there is no such
 issue before me. In view thereof it is not
 possible to at all entertain such a contention on
 behalf of the defendants.

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 16. Now turning to the other contentions which are
 raised before me, I am of the opinion that the
 contention, that the policy is only for
 house-breaking and burglary and does not cover risk
 of theft requires to be rejected outright. It is
 because the policy which has been produced before
 me inrespect of the second suit and admittedly the
 terms and conditions thereof are identical to the
 first policy in schedule provides by type written

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 words as under :

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 "Warranted that this policy is also
 extended to cover theft, risk subject
 to cost of Rs.500/- for each and every

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 claim".

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 17. These words are separately added to this
 policy in a schedule annexed thereto. Once the
 said words are added and the amount of Rs.500/-
 recovered towards the said risk by the defendant
 obviously the theft risk over and above the risk of
 house breaking and burglary as contemplated in the
 said policy has been covered by the defendant.
 However the contention of the learned counsel for
 the defendant is that the aforesaid words should be
 ignored and ought not to be taken into
 consideration inview of the policy as it reads was
 only in respect of the risk covered by house
 breaking and burglary and therefore this part of
 the sentence in the schedule is insignificant and

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 ought not to be taken into consideration. The

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 aforesaid submission is plainly required to be
 rejected. Firstly the entire insurance policy of
 burglary and house breaking is in the printed form
 and all the terms and conditions are provided in
 prints whereas the risk of theft has been expressly
 covered by super imposition of a typed condition in

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 a schedule annexed thereto. It is by now well
 settled proposition of law that in a printed
 contract if the parties impose an additional clause
 by type written or hand written then such special
 clause becomes a part and parcel of the contract
 and infact overrides the general terms and
 conditions of the said contract. In view of the
 aforesaid position in law which is now well settled
 it is not possible to accept the contention of the
 learned counsel for the defendants that the policy
 did not cover the risk of theft. Secondly in the
 present case the risk of theft is expressly covered
 by putting special condition in the schedule and
 not only that but inrespect of the said coverage of
 the risk the defendant has demanded extra premium
 and admittedly the plaintiff has paid the said

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 extra premium. Once the defendants having received
 the consideration for covering the risk of theft it
 is not permissible nor possible to permit them to
 regal out of their obligation under the said policy
 inrespect of the risk arising out of theft. In my
 opinion the reading of the policy as a whole covers
 all risk i.e. house-breaking, burglary and theft.
 In view of the aforesaid I am of the opinion that
 the contention of the learned counsel for the
 defendants that on true and proper interpretation
 and consideration of the terms and conditions of
 the said insurance policy it only covers the risk
 of house-breaking and burglary cannot be accepted
 and is liable to be rejected.

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 18. Now turning to the second contention which has
 been advanced before me pertaining to the watchman
 warranty. The watchman warrantee is appended as a
 special warranty by a printed leaf. The special
 watchman warrantee reads as under :

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ATTACHING TO AND FORMING PART OF
POLICY NO.:

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MEMORANDUM :-

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 It is expressely understood
 and agreed that a claim under
 this policy for loss/es or
 damage/s to the property
 covered hereby shall be deemed
 to be valid only if such
 loss/es or damage/s arise
 after overpowering the
 watchman/watchmen.

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 Subject otherwise to the
 terms, conditions, exceptions
 and limitations of the policy

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 SD/-
 DIVISIONAL MANAGER,

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 19. This appendage has to be co-related to a
 condition schedule where the following type written
 words have been inserted.

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 "Subject to Watchman Warranty attached
 hereto"

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 20. Thus by virtue of an addition of these words
 in the schedule the defendants have provided for a
 special condition of warrantee to provide watchman

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 inrespect of the said goods. It is also relevant
 to note that the proposal which has been given by
 the plaintiff which is Ex.D.2 on record under Item

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 -4 D reads as under :

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 4(d) Will the premises be guarded by a

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 watchman during day time and at night ?

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 . Yes, we have also employed 2 men for

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 day time and 2 men for night time.

¶124

 21. Thus on reading the proposal and policy

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 together leaves no manner of doubt that the

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 watchman warrantee is a special condition attached
 to the said insurance policy and thus the breach
 thereof would absolve the defendants from any
 liability to make any payment under the said
 policy. The contention of the learned counsel for
 the plaintiffs that infact the watchman warranty
 does not apply to the risk covered by theft but

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 only applies to the risk covered by burglary is

¶129

 simply required to be rejected. It is the addition
 of the word in a schedule of the policy by which
 the theft risk is covered at the same time the
 defendants have also added the words by type
 written in the schedule that the said risk is
 covered subject to the watchman warranty attached
 thereto. Thus it is clear that the intention of
 the defendants while covering the risk was that the
 plaintiff will as per their own proposal provide
 for necessary watchman to secure the said goods and
 thus the watchman warranty becomes an integral part
 even inrespect of the risk covered by theft and not
 only inrespect of the burglary risk. The learned
 counsel has contended before me that the word theft
 as defined under the provisions of section 378 of
 the I.P.C. does not admit of any use of force
 whereas the warranty attached to the insurance
 policy inter-alia requires an over powering of the
 watchman before the goods are stolen. It is his
 contention that by the user of the aforesaid words
 in the watchman warrantee the same by necessary
 implications only applies to burglary and does not

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¶131

 apply to risk of theft covered by the policy. I am
 unable to subscribe to the aforesaid contention.
 It is possible that the meaning of theft as defined
 under the Indian Penal Code may not have use of
 force but the said definition cannot be imported
 while interpreting the insurance policy in the
 present case. A theft also can be avoided if there
 is a watchman provided for safeguarding of the said
 goods. Thus merely because the watchman warranty
 prescribes for over powering of the watchman it
 cannot be restricted to the risk covered by
 burglary. As I have mentioned above the words
 ‘subject to watchman warrantee appended thereto’
 has been super imposed while covering the risk of
 theft by the defendant and thus in my opinion the
 said condition also applies to the risk covered by
 theft. Now turning to the contention that there

¶132

 has been a substantial compliance of the said
 warrantee and therefore the defendant should be
 held liable for making payment of the insurance
 claim. In support of the aforesaid contention the
 plaintiffs have produced a witness who is the Dock
 Manager being P.W. No.3. He has deposed that the

¶133

:29:

¶134

 Bombay Port Trust normally does not allow the
 watchman at the night time because the yards are
 closed and the watchman of the B.P.T. are

¶135

 available. However in the course of the cross

¶136

 examination he admitted that at the relevant time

¶137

 he was not concerned with the security requirement

¶138

 of the Bombay Port Trust and he was in the labour
 department. He has further deposed that he made
 such statements on the basis of inquiries made by
 him from the security officer at the relevant time.

¶139

 The evidence is purely hear-say. As against that

¶140

 the defendants has produced a letter dated
 31.3.1982 addressed to the surveyor by one Mr.
 Deshmukh and he has stated in the said letter that

¶141

 the private watchman were required to be appointed

¶142

 to guard the consignment 24 hours and in the

¶143

 present case the goods have been lost because the
 plaintiff did not provide the watchman in the night
 duty. He has also stated that in the said letter

¶144

 that the Shed Superintendent requested the
 plaintiff to keep the watchman during the night

¶145

 time rather than keeping the watchman in the day
 shift but the party never paid any attention and

¶146

:30:

¶147

 continued to withdrew the watchman by 9.p.m.
 leaving the consignment to the mercy of vagrants.
 This document has emancipated from a person who was
 in charge of the security at the relevant time. It
 is contempareous document and thus most credible
 and reliable piece of evidence.

¶148

 22. On the other hand from the evidence before me
 it is not possible to hold that there is a
 substantial compliance of the watchman warranty and
 therefore the defendants should be held liable to
 make payment of the aforesaid amount. In any event
 the theory of substantial compliance in the present
 case is misnomer. Even if the watchman is kept at
 a major part of the day but not kept on some part
 of the day or night then there is likelihood of
 theft being taken place at that point of time.
 Thus to apply the theory of substantial compliance
 in the present case would in my opinion would
 result in absurd consequence. I do not find any
 substance in the aforesaid arguments and
 accordingly I reject the same. The learned counsel
 has further contended that under Clause-1 of the

¶149

:31:

¶150

 terms and conditions of the policy what was
 required is substantial compliance only. The said
 clause reads as under :

¶151

Provided always that the due observance and
 fulfilment of the conditions contained herein
 or endorsed hereon shall so far as the nature
 of them respectively will permit be deemed to
 be conditions precedent to any right of the
 Insured to recover hereunder"

¶152

 23. It is his case that by virtue of the second
 proviso to the said policy which provides that
 there should be due observance and fulfilment of
 the conditions attached to the special policy in so
 far as it is possible. It has been thus contended
 that the conditions are required to be complied
 with in so far as they are possible to be complied
 with. It has been contended that since the port
 trust authorities were not permitting the
 employment of the watchman in the night time the
 plaintiff cannot be held responsible because that
 condition or a warrantee was not possible to be
 complied with in view of the policy of the port
 trust. Thus it is contended that by not employing
 the watchman in the night time due to the

¶153

:32:

¶154

 restrictions of the BPT the plaintiff cannot be

¶155

 made to suffer. Insupport of the aforesaid
 contention the learned counsel for the plaintiff
 has relied upon the evidence of the plaintiff
 himself who has deposed that the BPT were not
 permitting the watchman at the night time. He has
 also relied upon the evidence of the clearing

¶156

 agents of the said deputy Dock Manager. I have
 considered the said evidence of the said witness.

¶157

 I am of the opinion that the said evidence cannot

¶158

 be accepted firstly because, the plaintiff has not

¶159

 made any application to the port trust authority
 calling upon them to permit the private watchman at

¶160

 the night time also. The letter of the port trust

¶161

 which are relied upon at Ex.P.19 and Ex.P.20 were

¶162

 only addressed after filing of the suit in 2004.

¶163

 On record there is no evidence to show that at the

¶164

 relevant time the plaintiffs made efforts to get
 the said watchman posted during the night time and

¶165

 or the port trust authority refused the said
 request. Mere oral evidence at this stage cannot

¶166

 be accepted in its totality. The evidence of the
 Port Trust officer is totally without any

¶167

:33:

¶168

 substance. Infact as pointed out above he was not
 concerned with the security at the relevant time.
 Further more the concerned security officer who was
 on duty and has addressed a letter dated 31.3.1982
 has describes the situation other way round. It
 was a known factor at that time that this soap raw
 material was the subject matter of thefts. Various
 consignments belonging to various consignees were
 imported and there were many complaints of theft of
 the goods in the port trust area. It was thus
 necessary to provide for sufficient protection.
 Apart therefrom the policy has been obtained by the
 plaintiffs from the defendants on an express
 premises as mentioned in the proposal being
 Clause-4D which is set out herein above.

¶169

 24. The said clause-4D expressly indicate that an
 undertaking was given on the part of the plaintiff
 that they will provide for a watchman also in the
 night. The contention of the learned counsel for
 the defendants that they provided for watchman upto

¶170

 11.30p.m. that to be construed for the word
 ‘night’ and therefore the said

¶171

:34:

¶172

 condition/undertaking is complied with is merely
 required to be rejected.

¶173

 25. The learned counsel for the plaintiff in my
 opinion has rightly relied upon the judgment of the
 apex court in the case of Oriental Insurance Co.
Ltd vs. Samayanallur Primary Agricultural Coop
Bank reported in 1999 8 S.C. 543 in which the
 court has held as under :

¶174

 "There was no necessity of referring
 to the dictionaries for understanding
 the meaning of the word ‘safe’ which
 the parties in the instant case as
 proved to have understood while
 submitting the proposal and accepting
 the insurance policy. The cashier’s
 box could not be equated with the safe
 within the meaning of the insurance
 policy. The alleged burglary and the
 removal of the cash box containing the
 jewellery and cash was not covered by
 the insurance policy between the
 parties. the insurance policy has to
 be construed having reference only to
 the stipulations contained in it and
 no artificial far-fetched meaning
 could be given to the words appearing
 in it."

¶175

:35:

¶176

 26. In my opinion in view of the aforesaid
 proposition of law laid down by the apex court it
 is not possible to accept the contention of the
 learned counsel for the defendant that providing of
 a watchman upto to 11.30 p.m. must be read as if
 the watchman is provided for the whole night. In
 my opinion the reading of the terms of the proposal
 and the conditions of the insurance policy it
 leaves no manner of doubt that the watchman
 warranty was a special warranty imposed on the said
 policy even for the risk of theft and therefore the
 same forms a special condition thereto. It was
 necessary that the said condition was required to
 be adhered to and only by due observance of the
 said condition would entitle the plaintiff to
 recover the amount in the insurance policy for the
 risk covered by theft. In view of the fact that
 the plaintiff failed to abide by the said special
 condition attached to the said insurance policy, it
 is not possible for me to hold that the defendant
 is liable to make payment of the insurance amount
 covered in the said policy towards the loss of the
 goods. By virtue of the breach of the warranty by

¶177

:36:

¶178

 the plaintiff the liability of the defendant under
 the said insurance policy stands discharge and thus
 in my opinion the defendant is not liable to make
 any payment to the plaintiff herein. In the
 aforesaid circumstances I pass the following
 decree.

¶179

 Both the suits are hereby dismissed.

¶180

 There shall be no order as to costs.

¶181

 SD/-

¶182

 ***********

M/S.Maniklal Commodities P.Ltd. v. the Oriental Fire and General Insurance Co.Ltd.

Case brief

What is this about?

What did the court decide?

M/S.Maniklal Commodities P.Ltd. v. the Oriental Fire and General Insurance Co.Ltd.

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

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