SIKKA PAPERS LTD. versus NATIONAL INSURANCE CO. LTD. & ORS.

SIKKA PAPERS LTD. versus NATIONAL INSURANCE CO. LTD. & ORS.

The insurer is not liable to reimburse replacement of parts due to normal wear and tear, as per the general exceptions and terms of the Machinery Insurance Policy. Surveyor's assessment excluding such items and applying the pro-rata formula for under-insurance is valid. Corporate entities cannot claim damages for mental harassment.

Parties
Appellant: Sikka Papers Ltd.; Respondent: National Insurance Co. Ltd. & Ors.
Jurisdiction
India
Judgment Date
29 May 2009
Procedural Posture
Civil Appeal / Appeal From National Consumer Disputes Redressal Commission Decision
Outcome
Appeal dismissed
Legal Topics
Machinery Insurance Policy, Compensation, Under Insurance, Mental Harassment Claim by Corporate Entities
Insurance Consumer Protection Machinery Insurance Policy Compensation Under Insurance Mental Harassment Claim by Corporate Entities

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Parties

Sikka Papers Ltd.

Appellant

National Insurance Co. Ltd. & Ors.

Respondent

Procedural Posture

Civil Appeal / Appeal From National Consumer Disputes Redressal Commission Decision

Legal Issues

  1. 1 Whether insurer was justified in accepting surveyor's report assessing loss and rejecting parts replaced due to wear and tear
  2. 2 Whether insurer was justified in deducting amount as under-insurance from assessed loss

Ratio Decidendi

The insurer is not liable to reimburse replacement of parts due to normal wear and tear, as per the general exceptions and terms of the Machinery Insurance Policy. Surveyor's assessment excluding such items and applying the pro-rata formula for under-insurance is valid. Corporate entities cannot claim damages for mental harassment.

Court Disposition

Appeal dismissed

Orders

  • No interference with National Commission's award; insurer directed to pay Rs.10,47,491/- with 12% interest from the specified date after adjusting payments already made.
  • No order as to costs.