Twenty First Century Media ... vs New India Assurance Company Ltd ...
2016 Latest Caselaw 2451 Del

            *IN THE HIGH COURT OF DELHI AT NEW DELHI

%                                        Date of decision: 30th March, 2016

+                         W.P.(C) No.1338/2012

         TWENTY FIRST CENTURY MEDIA PRIVATE
         LIMITED                                    ..... Petitioner
                     Through: Mr. Saurabh Kirpal, Ms. Meghna
                              Mishra, Mr. Rohan Sharma and Mr.
                              Dheeraj P. Deo, Advs.
                                     versus

    NEW INDIA ASSURANCE COMPANY LTD (NIA)..... Respondent

Through: Mr. Pankaj Seth, Adv.

CORAM:-

HON'BLE MR. JUSTICE RAJIV SAHAI ENDLAW

1. The petition impugns (i) Endorsement Schedule dated 17 th October,

2010 issued by the respondent New India Assurance Company Limited qua the

insurance policy taken by the petitioner; (ii) letters dated 27 th October, 2010

and 4th October, 2011 of the respondent repudiating the claim of the petitioner

under the insurance policy obtained from the respondent and seeks mandamus

directing the respondent to settle the claim of the petitioner by remitting to the

petitioner a sum of Rs.1.60 crore along with interest at 18% per annum from

the date on which the payment became due until the date of settlement of the

claim.

2. Notice of the petition was issued and pleadings completed though

interim relief claimed of directing the respondent to deposit the amount of

Rs.1.60 crore in this Court not granted. The counsels were heard on 8th

September, 2015 and judgment reserved.

3. It is the case of the petitioner (i) that one M/s. Prerana International was

the successful bidder for the instadia advertising rights for the cricket matches

to be held in Kochi and Goa on 17th October, 2010 and 24th October, 2010

respectively; (ii) on 24th September, 2010 the petitioner entered into an instadia

advertising agreement with the said M/s. Prerana International and paid

Rs.1.10 crore as consideration therefor; (iii) the petitioner in turn entered into

agreements with various parties granting advertising rights in the stadia (iv) the

petitioner thereafter entered into an insurance contract agreement, policy

bearing no.311503/46/10/72/00000108 with the respondent on 15 th October,

2010 to cover the loss of revenue for matches aforesaid; (v) the insurance

policy covered the loss of revenue for a total sum of Rs.4.20 crores out of

which the coverage for the Goa match scheduled on 24th October, 2010 was

Rs.1.60 crores; (vi) that the policy covered the abandonment of the match

arising from the perils of (a) fire and allied perils; (b) storms, cyclone, typhoon,

tempest, hurricane, tornado, flood, inundation and rain; and, (c) riot, strike and

civil commotion; (vii) that the petitioner paid the entire premium of

Rs.3,24,284/- for the aforesaid policy; (viii) that as per the insurance policy,

cancellation of the match meant not a single ball being bowled in the match;

(ix) that both the matches i.e. at Kochi on 17th October, 2010 and at Goa on

24th October, 2010 were called off due to heavy rain; (x) the petitioner

informed the respondent of the same and called upon the respondent to pay the

money due under the policy; (xi) that the respondent vide letter dated 17 th

October, 2010 sent an endorsement to the petitioner arbitrarily and unilaterally

deleting the peril of storm, cyclone, typhoon, tempest, hurricane, tornado,

flood, inundation, rains, bad pitch conditions and wet ground conditions from

the insurance policy qua the match at Goa on 24 th October, 2010; (xii) the

petitioner immediately vide its letter dated 20 th October, 2010 protested; (xiii)

the petitioner vide its letter dated 25th October, 2010 requested the respondent

to settle the claim under the policy; (xiv) the respondent vide its letter dated

27th October, 2010 denied liability citing the endorsement issued on 17 th

October, 2010; (xv) that the subsequent deletion by the respondent of the peril

inter alia of rain is void ab initio and contrary to principles of consensus ad

idem and unreasonable, unfair and arbitrary; (xvi) that the respondent

ultimately vide letter dated 4th October, 2011 declared that the claim of the

petitioner had been repudiated by the Competent Authority of the respondent

as rain peril had been deleted from the scope of the policy vide Endorsement

dated 17th October, 2010; (xvii) that the petitioner has suffered loss which was

insured; (xviii) that the actions of the respondent are violative of Article 14 of

the Constitution of India; and, (xix) that the action of the respondent by

deleting the rain peril from the policy after becoming liable for the match at

Kochi is mala fide.

4. It is the stand of the respondent in its counter affidavit (i) that the dispute

raised in the petition is in relation to validity of contract between the parties

and the writ petition is not maintainable; (ii) that no part of the premium earlier

collected had become refundable after deleting the rain peril from the policy;

(iii) that the deletion was made much before the scheduled date of the match at

Goa on 24th October, 2010; (iv) that the petitioner inspite of receipt on 18th

October, 2010 of the endorsement regarding deletion and till prior to the

commencement of the match at Goa never objected thereto and raised

objection thereto only after the match at Goa was abandoned and when the

respondent denied its liability under the policy; (v) that upon the petitioner

approaching the concerned branch office of the respondent for obtaining

Standard Fire and Special Perils Policy covering the Kochi and Goa matches to

be played on 17th October, 2010 and 24th October, 2010 the said branch office

forwarded such proposal to the Competent Authority at Regional Office of the

respondent and on examination of the proposal of the petitioner the Competent

Authority at the Regional Office of the respondent informed the concerned

branch office that cover is to be given as per Standard Fire and Special Perils

Policy but the said concerned branch office misconstrued the cover and they

also allowed rain cover along with the perils as per Standard Fire and Special

Perils Policy; (vi) when an intimation of claim for cancellation of Kochi match

was received by the respondent it was noticed that the branch had issued the

policy with the rain coverage and immediately thereafter the Competent

Authority at Regional Office of the respondent advised the concerned branch to

delete the rain cover from the policy in relation to the match to be played at

Goa on 24th October, 2010 and the concerned branch thereafter immediately

issued the aforesaid Endorsement dated 17th October, 2010 deleting the

coverage in respect of rain; (vii) upon claim being received qua Goa match also

a surveyor was appointed who assessed the net loss as Rs.42,23,187/-; (viii)

however since the rain cover was not covered under the policy the claim of the

petitioner was not payable; (ix) that the petitioner having not protested against

the Endorsement dated 17th October, 2010 deleting the rain coverage till the

match at Goa was abandoned due to rain, cannot subsequently be allowed to

protest; and, (x) withdrawal of the rain peril coverage from the policy prior to

commencement of risk is neither unfair nor arbitrary.

5. Though the petitioner has filed a rejoinder but since no reference thereto

was made during the hearing, need to refer thereto is not felt.

6. I had at the outset only drawn attention of the counsel for the petitioner

to the dicta of the Supreme Court in Godavari Sugar Mills Ltd. Vs. State of

Maharashtra (2011) 2 SCC 439 and enquired from him as to how the writ

petition is maintainable. In fact option was given to withdraw the petition and

to file a suit or if there is an arbitration clause in the policy invoke arbitration

for claiming the contractual dues. However the counsel for the petitioner

relying on ABL International Ltd. Vs. Export Credit Guarantee Corporation

of India Ltd. (2004) 3 SCC 553 contended that the writ remedy is available

and there are no disputed questions of fact and thus the relief can be granted to

the petitioner in writ jurisdiction also.

7. I am however unable to agree. Supreme Court, after ABL International

Ltd. supra and Godavari Sugar Mills Ltd. supra has again dealt with the

question of maintainability of writ petitions in contractual matters in Joshi

Technologies International Inc. Vs. Union of India (2015) 7 SCC 728 and in

order dated 18th March, 2015 in Civil Appeal No.3053/2015 arising out of SLP

(C) No.15689/20011 titled National Highways Authority of India Vs. MEIL-

EDB LLC (JV) wherein the view taken by the Division Bench of this Court in

judgment dated 10th March, 2011 in W.P.(C) No.8418/2010 titled M/s.

Madhucon Projects Ltd. Vs. National Highways Authority of India was not

agreed with. I have in CCPL Developers Pvt. Ltd. Vs. Gail (India) Ltd.

MANU/DE/4361/2015, extensively quoting from the said judgment/order of

the Supreme Court, dealt with the question of maintainability of writ petitions

in contractual matters and concluded the Supreme Court to have held that:-

(a) the operative part of ABL International Ltd. supra has to be

understood in the context of discussion that preceded it and as per

which though there is no absolute bar to the maintainability of writ

petition even in contractual matters or where there are disputed

questions of fact or even when monetary claim is raised but

discretion lies with the High Court which under certain

circumstances can refuse to exercise;

(b) the High Court will normally not exercise such discretion unless

the action has some public law character attached to it;

(c) whenever a particular mode of settlement of dispute is provided in

the contract, the High Court would refuse to exercise its discretion

under Article 226 of the Constitution and would relegate the party

to the said mode of settlement, particularly when settlement of

disputes is to be resorted to through the means of arbitration;

(d) if there are very serious disputed questions of fact which are of

complex nature and require oral evidence for their determination,

again the High Court in its discretion would not entertain a writ

petition;

(e) money claims per se particularly arising out of contractual

obligations are normally not to be entertained except in

exceptional circumstances;

(f) ordinarily, where a breach of contract is complained of, the party

complaining of such breach may sue for specific performance of

the contract, if contract is capable of being specifically performed

and otherwise may sue for damages;

(g) if the contract between private party and the State/instrumentality

and/or agency of State is under the realm of a private law and

there is no element of public law, the normal course for the

aggrieved party, is to invoke the remedies provided under ordinary

civil law rather than approaching the High Court under Article

226 of the Constitutional of India and invoking its extraordinary

jurisdiction;

(h) only if the nature of the activity or controversy involves public

law element can the matter be examined by the High Court in writ

petitions under Article 226 of the Constitution of India to see

whether action of the State and/or instrumentality or agency of the

State is fair, just and equitable;

(i) in pure contractual matters extraordinary remedy of writ under

Article 226 or Article 32 of the Constitution of India cannot be

invoked; and,

(j) Writ Court should abjure from going into minute calculation and

controversy should be left to the Civil court to decide.

8. I have taken the same view as in CCPL Developers Pvt. Ltd. supra, also

in Playwell Impex (P) Ltd. Vs. United India Insurance Co. Ltd.

MANU/DE/3098/2015 which was also a case of enforcement of claim under a

insurance policy in writ jurisdiction and LPA No.892/2015 preferred

thereagainst is found to have been withdrawn on 17th December, 2015. The

same view was also taken by me in Hejian Solidkey Petroleum Machinery Co.

Ltd. Vs. Indian Oil Corporation Ltd. MANU/DE/2818/2015 and speaking for

the Division Bench of this Court in Chakradar Auto Udyog Pvt. Ltd.

Vs. Engineering Export Promotion Council MANU/DE/4248/2012. To the

same effect is Govt. of NCT of Delhi Vs. New Variety Tent House 189 (2012)

DLT 65 (DB) (SLP(C) No.23577 of 2012 preferred thereagainst is found to

have been dismissed on 3rd August, 2012).

9. The petitioner herein has not placed the insurance policy on record. It is

thus not known whether the same provides for arbitration. There is also a

material factual dispute whether the petitioner protested against the

Endorsement dated 17th October, 2010 prior to the cancellation of the match

scheduled on 24th October, 2010; while the petitioner claims to have done so

the respondent strongly refutes. We also do not know what were the other

terms and conditions of the policy and whether the same permitted deletion of

a peril prior to occurrence of loss attributable thereto. The effect if any of the

instructions alleged to have been issued by the Competent Authority of the

respondent at the Regional Office and in contravention whereto the policy is

stated to have been issued can also not be considered and adjudicated without

examination and cross examination of witnesses and which is not the domain

of writ jurisdiction. Not only so, the assessment of monetary claim if any to

which the petitioner may be entitled to also requires trial and neither does the

claim has any public law character nor is any exceptional case for entertaining

contractual claim in writ jurisdiction made out. Supreme Court, in LIC of

India Vs. Asha Goel (2001) 2 SCC 160 also held that where plea of fraud is

pleaded by Insurer, writ should not be entertained; here the respondent has

pleaded mistake.

10. I may also notice that the insurance of the kind taken by the petitioner is

now provided by private players as well and merely because the respondent is a

government company would not permit claims against it to be made in writ

petitions instead of under the ordinary Civil Law.

11. For all the aforesaid reasons and applying the dicta aforesaid of the

Supreme Court I hold the petition to be not maintainable and dismiss the same.

However since notice of the writ petition was issued and the same was

entertained and remained pending in this Court it is clarified that the time

between the date of institution of the petition in this Court i.e. 3 rd March, 2012

and till today shall be excluded in computing the limitation for the proceedings

if any taken by the petitioner for recovery of claims from the respondent.

No costs.

RAJIV SAHAI ENDLAW, J MARCH 30, 2016 'pp'..