IN THE HON’BLE HIGH COURT OF HIMACHAL PRADESH, SHIMLA. Civil Suit No. 99 of 1999. Judgment Reserved on 10.7.2008. Date of decision 08.09.2008. M/S Durga Gram Udyog Bricks Workers Welfare Association, Basdehra & another … Plaintiffs. Versus United India Insurance Co. & another… Defendants. Coram: The Hon’ble Mr. Justice Dev Darshan Sud, J. Whether approved for reporting?1 No. For the plaintiffs Mr. R.P.Singh, Advocate. For the defendants Mr. A.K.Sharma, Advocate. Dev Darshan Sud, J. This suit has been instituted by the plaintiffs claiming a sum of Rs.14,43,400/- on account of damages which have been suffered by the plaintiffs on account of floods which, according to the plaintiffs, washed away their stock of coal, bricks, both finished and unfinished, manufactured by them. 1 Whether Reporters of Local Papers are allowed to see the judgment? Yes. - 2 - The plaintiffs plead that plaintiff No. 1 is a society registered under the Societies Registration Act, 1860 and owns brick kilns in village Basdehra, Tehsil Mehatpur, Distt. Una. It had insured its stocks and raw material against damage by flood, fire etc. with defendant No. 1 to the extent of Rs.26 lakhs. The plaintiffs allege that during the intervening night of 13/14th August, 1995 there were heavy rains in tehsil Una including the place where the brick kiln owned by the plaintiffs is situated resulting in floods. The plaintiffs suffered losses because of the damage caused by floods washing away its stocks of coal, unfired bricks, labour huts etc. The plaintiffs further plead that the defendants were promptly informed and on their asking all the documents including stock register etc. have been supplied to them, but their claim was refuted on extraneous grounds. The defendants resisted the claim and pleaded that the plaintiff had concocted the story of damages and their surveyor did not find any loss as claimed by the plaintiffs. - 3 - On the pleadings, this Court settled 15 issues which are: 1. Whether M/S Durga Gram Udyog Bricks Workers Welfare Association is not a juristic person and the suit filed in the name of plaintiff No. 1 is not maintainable? OPD. 2. Whether the terms and conditions of ‘Fire Policy’ have been breached on account of setting up of fraudulent claim based on misrepresentation and misdescription and thereby the contract of insurance has become voidable? OPD. 3. Whether the cover note dated 3.7.1995 was issued and premium accepted by a person authorized to do so on behalf of the Insurance Company? OPP. 4. Whether the Insurance Policy was not issued/ delivered to the plaintiff by the Insurance Company? If so, its effect? OPP. 5. What is the effect of the arbitration clause of policy of insurance and on this count, whether the present suit is not maintainable? OPD. 6. Whether the plaintiffs are guilty of suppression of material facts and whether they have concocted and fabricated the documents, as alleged? If so its effect? OPD. - 4 - 7. Whether the suit is within limitation? OPP. 8. Whether the plaintiff No. 2 is authorized and competent to file the present suit? OPP. 9. Whether there were heavy rains and floods on 13.8.1995/ 14.8.1995 in the area of the brick kiln of the plaintiff? OPP. 10. Whether the plaintiffs had suffered any loss to the stocks of coal, infrastructure of the brick kiln, as alleged, on account of the floods? OPP. 11. What was the quantity of stocks of coal at the site, at the relevant time? OPP. 12. Whether the plaintiffs are entitled to any amount as compensation on account of loss sustained due to floods in the area of brick kiln, if so to what extent? OPP. 13. In the event of issue No. 10 being proved, whether the plaintiffs are entitled to claim any interest, if so at what rate, from which date and on what amount? OPP. 14. Relief. Issue No. 5 This issue was not pressed by learned counsel appearing for the defendants. Issue No. 7 - 5 - This issue does not survive for decision in view of the judgment of this Court in OSA 27 of 2001, titled Sunil Kumar versus United India Insurance Company and others, decided on 17.9.2007. Issue Nos. 9, 10, 11 and 12 These issues being very crucial to the entire suit are taken up together for discussion. Plaintiff relied on the evidence of PW-6 Shri Lachhman Dass, PW-7 Shri Dinesh Kumar, PW-8 Shri Vinod Sharma, PW-13 Shri Jai Lal, PW-14 Shri Surjit Singh, PW-15 Shri Rameshwar Dutt and PW-16 Shri Jagdev Chand to prove not only the fact that the area where the brick kiln is situated was flooded but heavy loss was caused to the stocks, coal and unfired bricks etc. lying at the spot. PW- 6 Shri Lachhman Dass Koundal, Naib Tehsildar, Una states in his evidence that he had received an application from the plaintiff through the Deputy Commissioner, Una regarding issuance of a Certificate Ex.PW-6/A issued by him certifying the damage caused to the plaintiffs. This certificate states that according to the report made by the Patwari Halqua and the Girdawar Kanungo, the plaintiff suffered considerable loss on 14.8.1995 - 6 - because of floods caused by heavy rains. In cross examination, he admits that he did not visit the spot personally and has no knowledge about the damage as the certificate Ex.PW-6/A has been issued on the reports of two officials as aforesaid. These two officials have admittedly not been produced in evidence. The reports made by them which form the basis of Ex.PW-6/A, i.e. Patwari and Kanungo have also not been proved by the plaintiffs. Besides generalizing the fact that damage has been caused, the report does not say anything. His cross examination is revealing. He says “At present I am not in possession of the original application which was received by me through Deputy Commissioner as I am posted now out of Una. Record was summoned from me, but I have not brought the said record today. My certificate, Ex.PW-6/A is based on the reports obtained from Patwari Halqua and Girdawar Kanungo. I did not visit the spot myself. I have no personal knowledge about the damage and my certificate is based on the report received from the aforesaid officials. The report received from the aforesaid two officials was specific about the damage caused to the brick kiln of plaintiff No. 1 because of heavy rains. I am not in - 7 - possession of the reports received from the aforesaid two officials, today. I have issued the certificate as per the orders of the Deputy Commissioner. I am not in possession of the office copy of this certificate. File and dispatch number is not mentioned in the said certificate. It is correct that at the relevant time I was holding the office of Naib Tehsildar, but certificate, Ex.PW-6/A, has been issued by me as Tehsildar…..” PW-7 Shri Dinesh Kumar says that he was the Secretary of Nagar Panchayat, Mehatpur in the year 1995. He testifies that Ex.PW-7/A which is the certificate issued under the signatures of Secretary, Gram Panchayat, Una is authentic. He has identified the signatures of the Secretary, Nagar Panchayat. This certificate says “Pramanit kiya jata hai ki dinank 13/14.8.1995 ko bhari barsha ke karan va barh ke karan, logon ka va Nagar Panchayat, Mehatpur / Basdehra ka bahut nuksan huya hai. Logon ke bahut makan Dhwast hue hain.” (Certified that on 13/14.8.1995 because of heavy rains, people and Nagar Panchayat, Mehatpur / Basdehra have suffered heavy losses. Lot of houses have been damaged). - 8 - This certificate even if accepted on its face value without anything more, does not establish the case of the plaintiffs as it says nothing about the damage suffered by them. PW-8 Vinod Sharma is Junior Assistant /observer in the Meteorological Department, Deputy Commissioner Office, Una. He only states that on 13/14.8.1995 rainfall at Una was 119.4 mm. In cross examination, he admits that measurement of the rainfall is taken in the complex of Deputy Commissioner’s office, Una. He states: “The measurement of the rain fall is taken in the complex of D.C.Office, Una. The rainfall at Basdehra or Mehatpur on the aforesaid dates was not measured. It is correct to suggest that in the rainy season, there may be rainfall at one place, but may not be so in the adjoining area.” His statement if taken on its face value only establishes that there was heavy rainfall at Mehatpur but does not prove floods or any damage etc. which may have occurred or sustained by the plaintiff by any flooding etc. which may have destroyed the stocks of the plaintiff. PW-13 Shri Jai Lal Bali has proved Ex.PW-13/A which is an - 9 - estimate of the purported damage which was caused to the buildings /sheds. A perusal of this report does not in any manner advance the case of the plaintiff as it only states about the amount required to build labour sheds etc. PW-14 Shri Surjit is a Draftsman who has only produced blue print Mark ‘X’. His evidence does not support the case of the plaintiff in any manner as he has not proved anything. PW-15 Rameshwar Dutt states on oath that he owns land in village Basdehra. On the intervening night of 13/14.8.1995 there were heavy rains and because of accumulation of large quantities of water in the Chos (seasonal streams), the brick kiln of the plaintiff was washed away. This witness again makes a general statement regarding the damage caused to the brick kiln of the plaintiffs and nothing else. PW-16 is Jagdev who says that he is the employee of the plaintiff and that he has to maintain the record. He swears on oath that about 3 to 4 lakhs of kacha (unfired) bricks were washed away in the nala. The plaintiffs have sought to quantify the damages on the basis of stocks of coal received by - 10 - them which was unutilized / stocked and was washed away in the floods. Learned counsel for the plaintiffs places reliance on the statement of PW-1 Ravi Kant, who is the District Inspector, Food and Supplies. He has proved on record permits issued to the plaintiffs Exts. P-1 to P-6, all dated 15.7.1995 and valid up to 26.7.1995, authorizing the plaintiffs to carry coal from Chandigarh to the place their brick kiln is situated. Learned counsel then refers to the evidence of PW-4, Ramesh Kumar, who is working in Himachal Motor Transport Company, Chandigarh. He has proved on record goods receipts Ex.PW-4-1/1 to Ex.PW-4/4, all dated 25.7.1995 for carriage of coal which was subject of Exts. P-1 to P-6. PW-3 Shri Sucha Singh who was working with Satluj Carrier Corporation has proved on record receipts Ex.PW-3/1 to Ex.PW-3/13. All these receipts are for the period 19.4.1995 to 27.6.1995. PW-2 Shri Satish Sharma is an employee of Chandigarh Gauhati Roadways and has proved on record Ex.PW-2/1 to Ex.PW-2/9 which are goods receipts for carriage of coal between 1.6.1995 to 24.6.1995. To similar effect is the statement of PW-5 Shri Gurdev Singh who is - 11 - working with Longia Roads Carrier and has proved Ex.PW-5/1, goods receipt issued for carriage of coal. On a reading of the evidence of the plaintiffs, it is evident that they have not been able to establish that their goods in the nature of raw material, coal, bricks, finished or unfinished, have been damaged by heavy rains and floods. Even if the evidence is accepted in its entirety, all that can be said is that there were heavy rains in the region in the intervening night of 13/14.8.1995. There is no evidence on record to show or establish that there was extensive flooding and it caused damage to the business of plaintiff No. 1. The permits and the goods receipts show that coal was received by the plaintiffs. What happened afterwards has not been established. That is to say, there is no material on record to show as to what was the production during the period between April to August, 1995, the consumption of raw material in the nature of coal, the output in terms of fired bricks and unfinished bricks which were waiting to be fired in the furnace. These facts were within the special knowledge of the plaintiffs - 12 - and could have been established from the books of accounts and stock and sales registers, vouchers and tax records which are maintained in the usual course of business to show the receipt of raw material and its utilization during production. No effort or attempt has been made to place this material on record. The goods receipts show that coal was received between April and July, 1995. Whether it was utilized or not, has not been established. In the facts and circumstances of the case, I cannot persuade myself to accept that the plaintiff has been able to establish that the coal received vide Exts. P-1 to P-6, PW-3/1 to PW-3/13, PW-2/2 to PW- 2/9 and Ex. PW-5/1 was actually washed away in the floods as alleged. I hold that the plaintiffs have not been able to establish two crucial facts, namely that there were heavy floods in the area in which the plaintiffs were carrying business and that the coal, finished and unfinished stock of bricks, was washed away in the floods. The defendants have also proved on record a detailed report submitted by DW-2 Sanjeev Duggal, who is a Chartered Accountant, wherein an assessment Ex. DW-2/B was made by him regarding the damage on - 13 - the spot and found that no loss had in fact been caused. Ex. DW-3/A which is the report of the investigator is to similar effect, only that it is strongly worded attributing motives to the plaintiffs for lodging false claims. As I have held the evidence of the plaintiffs is insufficient to establish the loss and the quantum of loss on record and therefore, it is unnecessary for me to consider the veracity of these two reports. All these issues are accordingly decided against the plaintiffs. Issue No. 13 This issue has become redundant in view of my findings on issues 9, 10, 11 and 12. Issue No. 6 The onus of this issue was on the defendants. Their claim is that the plaintiffs have put forward a false claim which is concocted and has no basis. Learned counsel for the defendants has referred to the two reports Ex. DW-2/B and Ex. DW- 3/A to substantiate these facts. I cannot persuade myself to hold on the evidence on record that a concocted claim has been put forward by the plaintiffs. It is one thing to say that the claim is concocted/ false/ not based on - 14 - material facts and another to hold that the evidence is insufficient to establish the damage caused etc. In the present case, I find that the plaintiff has been unable to establish through cogent evidence whether loss has been caused and if so, its quantum. Merely because the evidence of the plaintiffs is insufficient for grant of relief in law does not lead to an inference that the claim is concocted which requires deliberation, contemplation and manipulation of records. There is no evidence to establish any fabrication of evidence by the plaintiffs. This issue is decided against the defendants. Issue No. 2 This issue can be disposed of on my findings on issue No. 6. I do not find anything fraudulent in the claim which has been put up by the plaintiffs. Order 6 Rule 4 of the Code of Civil Procedure is clear on the pleadings required for establishing the question of fraud. I do not find any pleadings of the defendants on record to show that there has been any active or material concealment of facts which would nullify the cover - 15 - of Insurance Policy as lodged. This issue is accordingly decided. Issue No. 3 and 4 It is undisputed before me that cover note Ex.PW-18/B was issued on 3.7.1995 by the defendants and a sum of Rs.36,299/- had been paid. There is no cross examination on this point. Even the evidence on behalf of the defendants does not indicate or show that there is no valid insurance cover. This issue is, therefore, decided in favour of the plaintiffs and against the defendants. Issue No. 1 and 8 Ex.PW-18/A is the resolution passed by the plaintiff authorizing Shri Subhash Chand, son of Shri Bhagat Ram to institute the suit for and on behalf of the plaintiff. In the plaint, plaintiff No. 1 is shown to be represented through Shri Rajinder Rattan. OMP Nos. 494 of 2007 and 27 of 2008 have been filed under Order 1 Rule 10 of the Code of Civil Procedure and Section 21 of the Limitation Act to substitute the name of Shri Subhash Chand (plaintiff No. 2) in place of Rajinder Rattan, that is to say plaintiff No. 1 should be shown to have - 16 - been represented through Shri Subhash Chand who is already on record as plaintiff No. 2. It is no doubt true that Order 7 Rule 1 enjoins that the plaint shall contain the name and description of the plaintiff and the defendant so that they can be ascertained, but the title is only one part of the plaint. If it is reasonably clear on a fair and proper reading of the plaint in all its parts taken as a whole that a particular person is either the plaintiff or the defendant and is wrongly described in the title of the plaint, the defect or error in description can be corrected by an amendment. The power to correct mistake(s) in description can be exercised by the Court under Section 153 of the Code of Civil Procedure or Order 6 Rule 17 of the Code. On reading the plaint in its totality, I do not find that the defendant has been misled regarding the true nature of the suit or claim is being put forward by a different plaintiff. Section 21 of the Limitation Act has been held to be inapplicable in cases where plaintiff was suing in one capacity at any time, but amendment in title is made after amendment. (See Muthukrishna Pillai v. M.A. Rajam Aiyengar and others , AIR 1917 Madras - 17 - 471, Naba Kumar Chowdhury v. Higheazany , AIR 1925 Calcutta 419, Ramprasad Shivlal & others v. Shrinivas Balmukund and others , AIR 1925 Bombay 527 and Sri Ram Nath v. Sri Kedar and others , AIR 1970 Allahabad 406). These precedents need not be multiplied. Both these applications are accordingly allowed. Plaintiff No. 1 is allowed to be represented by plaintiff No. 2 who is already authorized as such vide Ex.PW-18/A. These issues are accordingly decided in favour of the plaintiffs. Issue No. 14 The suit of the plaintiffs was for recovery of damages and what they were required to prove was (a) floods caused by heavy rains (b) that loss was actually sustained by the plaintiffs and (c) the quantum. The evidence on record does not establish any of these factors, and falls far short of the requirement of proving the cause and actual loss which the plaintiffs were required to prove. Heavy rains do not necessarily mean floods. The purchase of stocks of raw material does not necessarily establish that such material was washed away in floods. The causative factors and the link between the two had to be established. In view of - 18 - what I have held above, I hold that the plaintiffs have been unable to establish (a) that the brick kiln was actually flooded by heavy rains and (b) that the stock of coal and bricks both finished and unfinished which the plaintiffs submit was in their possession was washed away resulting in total loss to the plaintiffs. In fact as I have held the accounts, production records and other evidence by which such loss could be established in the nature of tax returns etc. have not been produced and proved on the record. The suit of the plaintiffs is accordingly dismissed. There shall be no order as to costs. September 8, 2008 (PC). (Dev Darshan Sud), J.