Kerala High Court
New India Assurance Company Ltd vs G & M Industrial Products on 25 July, 2025
2025:KER:55172
W.P.(C).No.8448 of 2016
1
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR. JUSTICE S.MANU
FRIDAY, THE 25TH DAY OF JULY 2025 / 3RD SRAVANA, 1947
WP(C) NO. 8448 OF 2016
PETITIONER:
NEW INDIA ASSURANCE CO. LTD.
REP BY ITS DEPUTY MANAGER, REGIONAL OFFICE, M.G.
ROAD, ERNAKULAM.
BY ADVS.
SRI.GEORGE CHERIAN (SR.)
SMT.LATHA SUSAN CHERIAN
SMT.K.S.SANTHI
RESPONDENTS:
1 G & M INDUSTRIAL PRODUCTS
LAND MARK ENCLAVE, S A ROAD,
VALANJAMBALAM, KOCHI 682016.
2 THE HON'BLE INSURANCE OMBUDSMAN
OFFICE OF THE INSURANCE OMBUDSMAN,
ERNAKULAM.
BY ADVS.
SMT.ACHU SUBHA ABRAHAM
CHITHRA CHANDRASEKHARAN
SMT.K.R.MONISHA
SRI.PHILIP T.VARGHESE
SRI.THOMAS T.VARGHESE
THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 25.07.2025,
THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:
2025:KER:55172
W.P.(C).No.8448 of 2016
2
[CR]
S.MANU, J.
--------------------------------------------
W.P.(C).No.8448 of 2016
--------------------------------------------
Dated this the 25th day of July, 2025
JUDGMENT
First respondent submitted Ext.P1 complaint to the 2nd
respondent Insurance Ombudsman on 16.06.2015. Second
respondent stated in the complaint that the petitioner company
repudiated a claim for compensation raised by them on the
basis of Ext.P5 marine cargo specific voyage policy obtained on
15.06.2012.
2. First respondent transported 1,657 metric tons of
soda ash from Porbandar Port on 15.06.2012 through a barge.
The barge was not able to anchor at the destination, which was
Mangalore Port, due to adverse weather conditions. It was
diverted to Beypore Port. When the soda ash was unloaded, it
was noticed that a huge quantity of bags, amounting to 114.50
metric tons, was damaged. During the entire voyage, the sea
2025:KER:55172
was rough, and water happened to enter the vessel, resulting in
damage to the material.
3. Petitioner company rejected the claim for
compensation to the tune of Rs.23,56,066/- lodged by the 1 st
respondent. Hence, Ext.P1 complaint was submitted to the
Ombudsman. On receipt of notice from the Ombudsman, the
petitioner company submitted Ext.P2 on 27.07.2015. The
petitioner stated that they were agreeable to the Ombudsman
acting as a mediator between the complainant and the company
and giving recommendations for the resolution of the complaint.
However, the company added a note stating the reasons for
rejecting the claim. It was also pointed out in Ext.P2 that the
policy was issued in the name of the 1 st respondent which was a
partnership company and complaints from such firms were not
liable to be entertained by the Insurance Ombudsman. By
Ext.P4 dated 5.08.2015 petitioner raised objections against
considering the complaint of the 1 st respondent. It was
2025:KER:55172
submitted by the company that Ombudsman was empowered to
receive and consider complaints in respect of personal lines of
insurance only. It was contended that the 1 st respondent was a
partnership company and the policy issued to it was a marine
policy on commercial line. The petitioner requested the
Ombudsman to dismiss the complaint for the above said
reasons.
4. Ombudsman passed the impugned award on
14.10.2015. Ombudsman considered the following points:-
"a) Whether this Forum has the jurisdiction to hear
this complaint?
b) Was the policy issued correctly ?
c) Was the damage due to rain water as alleged by
the Insurer?
d) Whether damage due to rain water is excluded
under the policy?
e) Whether the grounds of repudiation were
correct?
f) Quantum of relief, if any."
2025:KER:55172
5. Regarding the jurisdiction to consider the complaint
Ombudsman observed that the 1 st respondent was a proprietary
concern. Unlike a partnership or company the proprietorship
business cannot be separated from the owner. The Ombudsman
also noted that the 1 st respondent agreed to limit the claim to
Rs.20,00,000/- as the power of the Ombudsman to grant relief
of compensation was circumscribed at Rs.20,00,000/-. Further
the Ombudsman noted that the petitioner had agreed by Ext.P2
dated 27.07.2015 for mediation by the Ombudsman. Therefore,
the Ombudsman held that the petitioner company, after
expressing consent, cannot argue that the Ombudsman had no
jurisdiction to consider the complaint. Contention of the
petitioner company regarding jurisdiction was overruled by the
Ombudsman and the complaint was considered on merits. The
petitioner company was directed, by the impugned award, to
pay the 1st respondent Rs.20,00,000/-.
2025:KER:55172
6. Learned counsel appearing for the petitioner assailed
the award passed by the Ombudsman raising diverse
contentions. Learned counsel submitted that though the
petitioner had challenged the proceedings of the Ombudsman
pointing out that the claim raised was above Rs.20,00,000/-,
the said contention is not being pressed in view of a decision of
the Division Bench of this Court in HDFC Standard Life
Insurance Company Ltd., & another v. Jyothi
Madhavan.U. & others [2024 SCC OnLine Ker 5090]. The
learned counsel stressed on the contention that the complaint
was not liable to be entertained for two other reasons pointed
out in the writ petition. He submitted that the provisions of
Redressal of Public Grievances Rules, 1998 which governed the
proceedings before the Ombudsman at the relevant time
enabled the Ombudsman to consider only grievances regarding
insurance policies taken on personal lines. He pointed out that
admittedly the policy obtained by the 1st respondent was a
2025:KER:55172
marine cargo specific voyage policy issued on commercial lines.
He hence contended that considering the claim was beyond the
jurisdiction of the Ombudsman. The learned counsel further
contended that the 1st respondent being a proprietary concern,
was not entitled to maintain the complaint before the
Ombudsman.
7. The learned counsel made reference to various
provisions of the Redressal of Public Grievances Rules, 1998. He
pointed out the definition of the expressions 'insured person'
and 'personal lines'. He submitted that 'insured person' means
an individual by whom or on whose behalf an insurance policy
was taken on personal lines. 'Personal lines' means an
insurance policy taken or given in an individual capacity. The
learned counsel submitted that a Division Bench of this Court in
National insurance Co. Ltd v. Indus Motor Company Pvt.
Ltd. and others [2005 (4) KLT 391] considered the provisions
of the Rules elaborately and held that the emphasis of Rule 13
2025:KER:55172
read with Rule 4(k) is on the words 'individual', 'personal lines',
'himself or through his legal heirs'. The Division Bench held that
an incorporated company would not fall under any of those
expressions. In the said case the Ombudsman had dismissed
the complaints filed by a company holding that the insured
being a company, the policy obtained could not be considered
as taken on 'personal lines' or in the other words in an individual
capacity. The learned Single Judge who considered the writ
petition filed by the company against the award of the
Ombudsman set aside the award and held that the complaint
was maintainable. The Division Bench reversed the judgment of
the learned Single Judge and upheld the order of the Insurance
Ombudsman. Learned counsel, relying on the judgment,
contended that the Ombudsman therefore lacked jurisdiction to
entertain the complaint of the 1st respondent which was not one
submitted in an individual capacity. The learned counsel pointed
out another reported judgment of this Court in Bajaj Allianz
2025:KER:55172
General Insurance Company Ltd. Ernakulam v. Puthen
Modern Rice Mill, Kalady and others [2021(2) KLT 640].
Learned Single Judge of this Court set aside the award of the
Ombudsman, passed on a complaint filed by a partnership firm.
Following the judgment of the Division Bench mentioned supra,
the learned Single Judge held that the expression any person
used in Rule 13 will not take within its scope a partnership firm
also. The learned counsel pointed out that the 1 st respondent
was admittedly a firm. He pointed out that the language
employed in Ext.P1 would show that the business was not run
by an individual. He contended that in the complaint the
expression used is 'we' to describe the complainant. The
learned counsel further contended that the object of Redressal
of Public Grievances Rules was to resolve complaints regarding
policies issued on personal lines. He submitted that in such
policies normally the stakes involved will be comparatively less
than the policies issued on commercial lines. Detailed
2025:KER:55172
examination of evidence following the rules of evidence is not
involved in the summary procedure adopted under the Rules. He
therefore argued that disputes regarding policies issued on
commercial lines involving huge amounts and serious
contentions cannot be decided by the Ombudsman. Hence, the
obvious purpose for framing the Rules was to provide a speedy
mechanism for redressal of grievances arises from policies
issued on personal lines like mediclaim policies, personal
accident policies, etc. He further submitted that fixing a cap for
granting monitory relief by the Ombudsman was also for the
reason that the Ombudsman was not expected to consider
complaints regarding policies issued on commercial lines. He
hence submitted that the complaint was not maintainable before
the Ombudsman and the reasons given by the Ombudsman for
rejecting the contention of the petitioner regarding jurisdiction
were fallacious.
2025:KER:55172
8. The learned counsel appearing for the 1 st respondent
submitted that none of the objections raised by the petitioner
with respect to the impugned award were sustainable. He
contended that the 1st respondent is a proprietorship concern
and the same is evident from Ext.P1. The complaint was
submitted by the sole proprietor. He argued that a
proprietorship concern cannot be equated with a company or a
partnership. The learned counsel relied on the judgments of the
Hon'ble Supreme Court in Ashok Transport Agency v.
Awadhesh Kumar and Another [(1998) 5 SCC 567] and
Raghu Lakshminarayanan v. Fine Tubes [(2007) 5 SCC
103]. The Hon'ble Supreme Court held in those cases that a
proprietorship concern is only the business name in which the
proprietor of the business carries on the business. The learned
counsel therefore submitted that when a proprietorship concern
avails a policy the same can be considered only as issued on
personal lines. In other words, the applicant is an individual,
2025:KER:55172
though he may be having a different business name ie, of the
proprietorship concern. He hence submitted that the policy
availed was on individual lines and the Ombudsman had
jurisdiction to consider the complaint. The learned counsel
pointed out the observations of the Ombudsman in the
impugned award that evidence was adduced by the 1 st
respondent to prove that it was a proprietorship concern.
Learned counsel argued that no contrary evidence was adduced
by the petitioner company. The learned counsel also pointed
out that the 1st respondent had been regularly obtaining policies
from the petitioner and therefore the legal status of the 1 st
respondent was well known to the petitioner. The learned
counsel submitted that the objection regarding jurisdiction was
properly analysed by the Ombudsman and the complaint was
entertained. The Ombudsman appreciated the merits of the case
and found that the 1st respondent was entitled to succeed. He
hence submitted that the award is not liable to be interfered
2025:KER:55172
with by this Court.
9. Complaint in the instant case was dealt with under
the Redressal of Public Grievances Rules, 1998 which was later
substituted with 'The Insurance Ombudsman Rules, 2017' which
also by and large contain identical provisions. Rule 13 of
Redressal of Public Grievances Rules, 1998 dealt with the
manner in which complaint to the Ombudsman was to be made.
Rule 13(1) reads thus:-
"13. Manner in which complaint is to be
made:-(1) Any person who has a grievance against
an insurer, may himself or through his legal heirs
make a complaint in writing to the Ombudsman
within whose jurisdiction the branch or office of the
insurer complaint against is located."
10. It is relevant to note the definition of the expression
'insured person' under Rule 4(i). It is extracted hereunder:-
"insured person" means an individual by whom or
on whose behalf an insurance policy has been taken
on personal lines."
2025:KER:55172
11. Definition under Rule 4(i) mentions about policies
taken on personal lines. Expression 'personal lines' is defined
under Rule 4(k). The definition reads as under:-
"Personal lines" means an insurance policy taken
or given in an individual capacity. "
12. Division Bench of this Court in the judgment reported
in National insurance Co. Ltd v. Indus Motor Company
Pvt. Ltd. and others [2005 (4) KLT 391] analysed the
provisions of the Rules and held as under:-
" 6. The word "person" as such is not defined either
in the Insurance Act or in the Rules. Rule 4(i) of the
Rules defines the words "insured person" to mean
an individual by whom or on whose behalf an
insurance policy has been taken on personal lines.
Section 4(k) of the Rules states that "personal
lines" means an insurance policy taken or given in
an individual capacity. Only an insured person as
defined in Rule 4(i) read with Rule 4 (k) would fall
under the term "any person" in Rule 13. Rule 13
2025:KER:55172
also uses the expression "may himself or through
his legal heirs". Rule 13 states that any person who
has a grievance against an insurer, may himself or
through his legal heirs make a complaint. The
expression "may himself or through his legal heirs'
qualifies the expression "any person". Definition
clause available under the General Clauses Act, in
our view, cannot be imported to explain the
meaning of the expression "any person" in the
Rules, since Rule itself gives sufficient indication
with regard to the expression "any person". Further
definition clause in Section 3 of the General Clauses
Act giving the definition says that the definition
clause would apply to the General Clauses Act.
8. Legislature as a rule making authority makes
several rules from the experience gathered from
the past and may design to use the words to deal
with certain classes of persons. This rule firmly
establishes that the intention of the legislature
must be found by reading the statute as a whole.
In order to examine the nature of the power
conferred on the Ombudsman we are guided by
Rule 13 read with Rule 4(1)(k)* which places
*Rule 4(1)(k) mentioned above may be read as Rule 4(k).
2025:KER:55172
emphasis on the words "individual", "personal
lines", "himself or through his legal heirs". There is
nothing to show that incorporated company would
fall under any of those expressions. We may in this
connection refer to the definition of the expression
"insurer" in Section 2(9) which states that any
individual or unincorporated body of individuals or
body corporate incorporated under the law of any
country. If the legislature wanted the incorporated
company also to come within the definition clause
of "insured person" or "any person" within the
meaning of Rule 13 the same could have been
incorporated in the Rules. Having not incorporated
we are of the view, the court is not justified in
importing a meaning which has not been attributed
the rule making authority to the expression "any
person" since the context clearly shows otherwise.
Above being the legal position, we find it unable to
subscribe to the view of the learned single judge."
The Division Bench, in the above judgment held that Rule 13
read with Rule 4(k) would give clarity regarding the nature of
power conferred on the Ombudsman. As noted earlier, the
2025:KER:55172
Division Bench held that emphasis was on the words 'individual',
'personal lines', 'himself or through his legal heirs'. The Division
Bench categorically held that an incorporated company will not
fall under any of those expressions. In the judgment in Bajaj
Allianz General Insurance Company Ltd. Ernakulam v.
Puthen Modern Rice Mill, Kalady and others [2021(2) KLT
640] learned Single Judge followed the above judgment of the
Division Bench and held that a partnership firm will also not fall
within the ambit of the term any person as contained in Rule 13.
Contention of the 1st respondent is that those conclusions are
not applicable in the case at hand as the 1st respondent is a
proprietorship concern. The learned counsel for the 1 st
respondent relying on the judgments of the Hon'ble Supreme
Court had asserted that the proprietorship is only a business
name of the individual and hence a policy availed by
proprietorship can be considered only as a policy taken on
personal lines. Therefore, the said contention needs to be
2025:KER:55172
addressed in this writ petition.
13. Definition of 'insured person' under Rule 4(i) shows
that the expression covers an individual. Definition of the
expression 'personal lines' emphasizes that it means a policy
taken or given in an individual capacity. Provisions of Rule 13
show that if there is a grievance against an insurer he himself or
his legal heirs can make a complaint to the Ombudsman. Sub-
rule (2) of Rule 13 provides that the complaint in writing shall
be duly signed by the complainant or through his legal heirs.
Though nowhere in the Rules there is any express exclusion of
complaints submitted other than by individuals, conjoint reading
of the provisions to understand the scheme gives the impression
that the Rules were intended for redressal of grievances of
individuals. There is no indication in the Rules that adjudication
of disputes arising from policies issued on commercial lines to
entities like companies, partnership or other business
establishments including proprietorship concerns by the
2025:KER:55172
Ombudsman was envisaged under the Rules. As noted above, all
indications are to the contrary.
14. Contention of the 1st respondent that proprietorship
concerns are business names of the proprietors and hence
policies obtained by such concerns are to be considered as
availed by individuals cannot be accepted in the context of the
Redressal of Public Grievances Rules,1998. Law laid down by the
Hon'ble Supreme Court as pointed out by the learned counsel
for the 1st respondent was in the context of the Code of Civil
Procedure. The issue considered by the Hon'ble Supreme Court
in Ashok Transport Agency(supra) case was regarding the
applicability of Order XXX to a proprietorship concern. In Raghu
Lakshmi Narayanan (supra), the Hon'ble Supreme Court was
following the judgment in Ashok Transport Agency (supra).
Observations made by the Hon'ble Supreme Court are to be
understood in the context in which they were made.
Observations made while considering the applicability of the
2025:KER:55172
provisions of the Code of Civil Procedure cannot be applied as
such to understand the scope of the provisions of Redressal of
Public Grievances Rules. Object and purpose and also the
matter it governs makes the Redressal of Public Grievances
Rules a unique law. Scope of the provisions of the said Rules has
to be understood keeping in mind that the provisions are
intended to provide remedies in the case of disputes arising
from insurance policies.
15. The Ombudsman considered the objection regarding
jurisdiction in the impugned award and observed that
expression 'personal lines' has not been defined in the Rules.
This observation of the Ombudsman was incorrect. As noted
above, Rule 4(k) defined the expression 'personal lines'. The
Ombudsman instead of referring the relevant Rules, relied upon
the information available on the website of IRDA. The said
approach was erroneous. Ombudsman held that from the legal
angle, proprietorship business is not separated from the owner
2025:KER:55172
unlike a partnership or a company and hence complaints raised
by proprietors can be considered. The relevant issue which
should have been addressed was as to whether a complaint
pertaining to a policy obtained on commercial lines and not in
an individual capacity was maintainable as per the provisions of
the Rules. The Ombudsman misguided himself and failed to
address the issue appropriately. The reasoning of the
Ombudsman that after agreeing that the Ombudsman can act
as a mediator, the petitioner cannot object to adjudication by
the Ombudsman was also incorrect. It is to be noted that
though the petitioner had stated in Ext.P2 that they were
agreeable for the Ombudsman to act as a mediator, the
company also specifically pointed out that the complaint was not
admissible under the purview of Insurance Ombudsman. The
Ombudsman failed to note that the power of the Ombudsman
regarding consideration of complaints under Rule 13 is
specifically dealt with under Rule 12(1), whereas the power of
2025:KER:55172
the Ombudsman to act as a Counsellor and Mediator is
separately dealt with under Rule 12(2). That being so,
expression of willingness for mediation by a party cannot
preclude the said party from raising objections regarding
maintainability of the complaint before the Ombudsman.
Assumption of jurisdiction by the Ombudsman to adjudicate the
complaint on the basis of willingness expressed by the petitioner
for mediation was without perceiving that mediation and
adjudication under the Rules were two distinct functions
entrusted with the Ombudsman.
16. In view of the above discussion, I hold that Redressal
of Public Grievances Rules, 1998 conferred authority on the
Insurance Ombudsman only to consider complaints of
individuals who or on whose behalf insurance policies were
taken on personal lines. Policies obtained by proprietorship
concerns were not within the purview of the Rules. Hence, the
Ombudsman ought not to have entertained the complaint of the
2025:KER:55172
1st respondent and passed the award. The award is therefore
liable to be set aside.
The writ petition is allowed. The impugned award dated
14.10.2015 of the Insurance Ombudsman, Kochi is set aside.
Sd/-
S.MANU
JUDGE
skj
2025:KER:55172
APPENDIX OF WP(C) 8448/2016
PETITIONER'S EXHIBITS
EXT.P1 TRUE COPY OF THE COMPLAINT FILED BY THE FIRST
RESPONDENT BEFORE THE INSURANCE OMBUDSMAN.
EXT.P2 TRUE COPY OF THE WRITTEN NOTE DTD 27/7/2015
FILED BY PETITIONER
EXT.P3 TRUE COPY OF THE LETTER DTD 16/5/2014
EXT.P4 TRUE COPY OF THE LETTER DTD 5/8/2015 TO THE 2ND
RESPONDENT
EXT.P5 TRUE COPY OF THE POLICY
EXT.P6 TRUE COPY OF THE ORDER OF THE OMBUDSMAN, DTD
14/10/2015
