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REPORTABLE  

IN THE SUPREME COURT OF INDIA  

CIVIL APPELLATE JURISDICTION  

CIVIL APPEAL NOS.1217-1218  OF  2017                  

M/s. Sonell Clocks and Gifts Ltd.        ....Appellant(s)          

:Versus:    

The New India Assurance Co. Ltd.        ....Respondent(s)    

J U D G M E N T  

A.M. Khanwilkar, J.  

1. The appellant filed a complaint before the National  

Consumer Disputes Redressal Commission, New Delhi being  

Consumer Complaint No.20 of 2006, asserting that it had  

taken an Insurance Policy from the respondent (Insurance  

Company) for a period of one year from 19th July, 2004 to 18th  

July, 2005, in respect of its building, plant and machinery at  

plot No.70/3, B.K. Textile Compound, Dan Udyog Sangh Ltd.,  

Piparia, Silvassa, Dadra Nagar, Haveli, for a sum assured of

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Rs.2,87,00,000/- (Two Crore Eighty Seven Lakh Only) on  

reinstatement value basis. Due to torrential rains and floods in  

the entire area, the water gushed into the factory premises  

causing damage to the machinery as well as raw material lying  

therein. This event occurred on 4th August, 2004. Intimation of  

the loss was given to the respondent after a gap of 3 months  

25 days, on 30th November, 2004.  Thereafter, the respondent   

appointed a surveyor to assess the loss caused due to the  

flooding of the factory premises. The surveyor after causing  

inspection submitted its report to the respondent inter alia  

stating that the claim was not payable on account of the  

failure of the complainant to comply with the mandate of  

Clause 6 of the general conditions of the policy. Acting upon  

the said report, the respondent vide letter dated 18th February,  

2005 conveyed rejection of the claim to the appellant on the  

ground that neither the intimation of the loss had been given  

to it immediately nor were the requisite particulars of the loss  

conveyed within stipulated period.  Thus, there was breach of  

terms and conditions of Clause 6 of the general conditions of  

the policy.  

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2. As a sequel, the appellant  approached  the Commission  

for a declaration that the respondent was guilty of deficiency  

in service as well as unfair trade practices. Additionally,  to  

direct the respondent to sanction the genuine claim of the  

appellant and reimburse the loss caused to it due to the floods  

to the tune of Rs.2,66,05,000/-(Two Crore Sixty Six Lakh Five  

Thousand Only) with interest at the rate of 21% per annum  

from the date of incident till realization of the same. The  

appellant also prayed for compensation amount of  

Rs.5,00,000/- (Five Lakh Only) towards mental agony and cost  

and further an amount of Rs.1,00,000/- (One Lakh Only)  

towards incidental expenses.  

 3.  The complaint was opposed by the respondent on the  

ground that there was gross violation of the terms and  

conditions of the policy as no intimation muchless immediate  

information about the loss was given to the Insurance  

Company nor was a claim lodged with the requisite particulars  

within the time stipulated in the policy.   

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 4. This objection commended to the Commission as a result  

of which, the complaint filed by the appellant came to be  

dismissed by the judgment and order dated 10th December,  

2015 on the following terms:   

“5. It would thus be seen that as per the terms and  

conditions of the policy taken by it, there were three  obligations on the complainant/insured. The first obligation  

was to give notice of the loss to the insurer, immediately on  the said loss taking place. The second obligation on the  complainant was to submit a claim for the loss or damage,  

giving all necessary particulars of the loss, within a period of  15 days or such other time as the insurer might allow. The  third obligation on the insured was to intimate the insurer,  

within six months of the date of the loss, that it intended to  replace or reinstate the property which had been destroyed  

or damaged.   6. It is not in dispute that the alleged loss despite having  occurred on 04.08.2004 was reported to the Insurance  

Company only on 30.11.2004. Thus neither immediate  intimation of the loss was given to the Insurance Company  

nor was a claim lodged with the requisite particulars within  the time stipulated in the policy. The complainant Company,  therefore, contravened clause 6 of the insurance policy taken  

by it on account of the above referred two defaults.   7. It is contended by the learned counsel for the  complainant that the requirement of intimating the insurer  

and submitting a claim within 15 days of the loss stands  superseded by clause 4(3) applicable to reinstatement value  

policies, which required the requisite intimation to be given  within six months of the date of loss. I, however, find no  merit in the contention. The obligation of the insured under  

clause 4(3) applicable to reinstatement value policies was  independent of the obligation placed upon it under clause 3  

of the said policy. Under clause 3 of the policy, the insurer  was to be informed immediately on happening of the loss  followed by lodging of the claim with necessary particulars  

within 15 days of the loss or within such further time as

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should be extended by the insurer, whereas under clause  4(3), which was applicable to reinstatement value policies, it  

has to express its intention to replace or reinstate the  property which had been destroyed or damaged. There is no  

question of any supersession of clause 6 of the policy by  clause 4(3), applicable to reinstatement value policies, the  reinstatement of these clauses being distinct and separate  

from each other.   8. For the reasons stated hereinabove, I have no  hesitation in holding that the complainant committed breach  

of clause 6 of the insurance policy, and therefore as  stipulated in the said clause, no claim under the policy is  

payable.   The complaint is, therefore, dismissed with no order as  to costs.”   

5. The aforementioned decision was assailed before this  

Court by way of Civil Appeal No……..(D.No.6048 of 2016).    

This Court vide order dated 26th February, 2016, relegated the  

parties before the Commission by giving liberty to the  

appellant to file a review petition before the Commission on  

the singular contention of waiver of condition stipulated in  

Clause No.6 by the respondent. The order reads thus:   

“O R D E R   Delay condoned.  

Heard Mr. Jitendra Mohan Sharma, learned senior  counsel for the appellant. It is submitted by the learned  

counsel that the insurer has waived the condition relating  to delay in intimation by appointing a surveyor.   On a perusal of the order passed by the National  

Consumer Disputes Redressal Commission (N.C.D.R.C.),

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New Delhi, we do not find that the said issue was raised  before the N.C.D.R.C.  

In view of the aforesaid, we permit the appellant to file  an application for review and put forth the issue of waiver  

before the N.C.D.R.C. within a period of four weeks hence.  The N.C.D.R.C. will entertain the application for review  singularly on this score.  

With the aforesaid observation, the appeal is disposed  of.”  

     (emphasis supplied)    

  It is noticed that no liberty was given to the appellant to  

challenge the judgment and order dated 10th December, 2015  

passed by the Commission, in the event the review petition  

was decided against the appellant.   

 6. Be that as it may, as per the liberty given by this Court   

the appellant preferred a review petition before the  

Commission bearing Review Petition No.662 of 2016. The   

singular issue as to whether the respondent (insurer) had  

waived the condition relating to delay in intimation by  

appointing a surveyor was considered by the Commission. The  

Commission adverted to the decision of this Court in Oriental  

Insurance Co. Ltd. Versus Parvesh Chander Chadha1. It  

then noticed the decision of the Commission in New India  

                                                           1 MANU/SC/1343/2010 Civil Appeal No.6739 of 2010 dated 17th August, 2010

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Assurance Company Ltd Versus Trilochan Jane2.  

Additionally, the Commission adverted to the decision in State  

of Punjab Versus Davinder Pal Singh Bhullar and Others3  

and on analysing the factual matrix concluded that there was  

nothing to indicate an intentional and conscious  

relinquishment by the respondent (insurer) of its right to reject  

the claim on account of the delayed intimation of the loss, by  

appointing a surveyor to assess the loss claimed by the  

insured (appellant). The Commission distinguished the  

decision of this Court in Galada Power and  

Telecommunication Ltd. Versus United India Insurance  

Co. Ltd. and Another,4 which was profusely  relied upon by  

the appellant as not applicable to the facts of the present case.  

At the end, the Commission also relied on the observation in  

Reliance General Insurance Company Ltd. Versus Harleen  

Kaur5.   

                                                           2 First Appeal No.321 of 2005 dated 9th December, 2009  3 (2011) 14 SCC 770  4 (2016) 14 SCC 161  5 In Revision Petition No.2850 of 2015

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7. The review petition filed by the appellant was accordingly  

dismissed vide judgment and order dated 25th October, 2016.  

Both the decisions of the Commission dated 25th October,  

2016 in Review Application No.77 of 2016 and dated 10th  

December, 2015  in Consumer Complaint No.20 of 2006 have  

been assailed in the present appeals.   

8. The appellant would contend that the issue is no more  

res integra. For, this Court in Galada Power and  

Telecommunication Ltd. (supra), while considering similar  

contention has held that the insurer having appointed a  

surveyor despite stipulation such as in Clause 6, waives its  

right to advance the plea that the claim was not entertainable  

because of the condition enumerated in duration clause was  

not satisfied.  

9. Per contra, the respondent would contend that the  

dictum in the said decision is contextual and in the backdrop  

of the factual matrix of that case. In other words, the issue of  

waiver by the insurer has been answered against the insurer  

not merely because of appointing a surveyor despite the

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stipulation in the policy, but the Court at more than one place  

while analysing the facts noted the additional circumstance  

that the letter of repudiation sent by the insurer merely stated  

that, the claim lodged by the insured was not falling under the  

purview of the transit loss. The Court opined that the  

appointment of a surveyor despite the stipulation in Clause 5  

therein was a positive action taken by the insurer reinforcing  

the finding of waiver of its right to advance the plea that the  

claim was not entertainable because the condition enumerated  

in duration clause was not satisfied.   

10. We have heard Mr. Jitendra Mohan Sharma, learned  

senior counsel for the appellant and Mr. Joy Basu, learned  

senior counsel for the respondent.  

 11. The singular question involved in these appeals is  

whether the respondent (insurer) had waived the condition  

relating to delay in intimation, by appointing a surveyor.  

12. It is well established position that waiver is an intentional  

relinquishment of a right. It must involve conscious

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abandonment of an existing legal right, advantage, benefit,  

claim or privilege, which except for such a waiver, a party  

could have enjoyed.  It is an agreement not to assert a right.   

To invoke the principle of waiver, the person who is said to  

have waived  must be fully informed as to his rights and with  

full knowledge about the same, he intentionally abandons  

them. [See para 41 of State of Punjab (supra)].  There must  

be  a specific plea of waiver, much less of abandonment of a  

right by the opposite party.    

13. We shall, therefore, first traverse through the pleadings  

of the parties. The appellant has asserted that it was  pointed  

out to the respondent that the act of appointing surveyor by  

the respondent was an implied consent of condoning the  

delay. In case the respondent wanted to repudiate the  

appellant‟s claim only on the technical ground of 15 days‟  

delay, it should have done at the first instance and there was  

no need to have appointed a surveyor thereafter.   

14. The respondent while refuting the said assertion of the  

appellant stated in the written version filed before the

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Commission that the appellant was negligent in dealing with  

its affairs, including in the matter of informing  the respondent  

forthwith about the claim after the loss or damage caused on  

account of flooding as was essential as per condition No.6 of  

the policy. Condition No.6 of the policy reads thus:   

“6. (i) On the happening of any loss or damage the insured  shall forthwith give notice thereof to the Company and shall  

within 15 days after the loss or damage, or such further time  as the Company may in writing allow in that behalf, deliver  to the Company  

……………………………..  No Claim under this policy shall be payable unless the terms  

of this condition have been complied with.”  

The respondent also urged that after the receipt of the claim  

intimation from the Bank, it immediately appointed M/s.  

Saran Engineers & Consultants to survey and assess the loss.  

The surveyor after visiting the premises gave a detailed report  

dated 29th December, 2004 including its recommendation that  

the loss is not payable as per the policy (B) General  

Conditions, Para 6. On the basis of that report and keeping in  

mind the terms and conditions of the policy, the respondent  

repudiated the claim in terms of policy condition No.6 and  

intimated the repudiation of the claim to the appellant  vide

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letter dated 18th February, 2005. The respondent also asserted  

that the true import of the letter of repudiation is a matter of  

interpretation. In any case, the appointment of the surveyor  

was necessary, otherwise the appellant would have  

complained about the non-appointment of the surveyor.  The  

respondent urged that the appellant was in breach of the  

policy condition.  

 15. The Commission considered the pleadings of the parties  

and including condition No.6 of the Insurance Policy, the  

repudiation letter dated 18th February, 2005 and the  

Surveyor‟s Report which had recommended that the loss as  

such is not payable as per the Policy. The Commission then  

went on to distinguish the decision in Galada Power and  

Telecommunication’s case, (supra).   

 16. In the said case, the issue of waiver was decided on the  

facts of that case as is evinced from the dictum in paragraphs  

18-20 of the said decision. The same reads thus:  

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“18. In the instant case, the insurer was in custody of  the policy. It had prescribed the clause relating to  

duration. It was very much aware about the stipulation  made in Clauses 5(3) to 5(5), but despite the stipulations  

therein, it appointed a surveyor. Additionally, as has  been stated earlier, in the letter of repudiation, it only  stated that the claim lodged by the insured was not  

falling under the purview of transit loss. Thus, by  positive action, the insurer has waived its right to  advance the plea that the claim was not entertainable  

because conditions enumerated in duration clause were  not satisfied. In our considered opinion, the National  

Commission could not have placed reliance on the said  terms to come to the conclusion that there was no policy  cover in existence and that the risks stood not covered after  

delivery of goods to the consignee.  

19. Coming to the merits of the claim, we find that the  surveyor had given a report that there was a loss. He had  

also quantified it. The State Commission after elaborate  discussion has held as follows:  

„The surveyor also confirmed in their reports, the  shortage/loss of AAAC due to pilferage during transit and  

estimated the loss as per Ext. A-12. This shortage was also  confirmed by Katigorah Police as per Ext. A-13 and as  

reiterated earlier by the Takeover Certificate, Ext. A-19.  Taking into consideration that the surveyors appointed by  the insurance company have completed their investigation  

and submitted their reports and thereafter an investigator  was appointed on 16-4-1998 without any valid reasons. It is  held by the National Commission in Gammon India Ltd. v.  New India Assurance Co. Ltd. that: (CPJ p. 10)  

„… Report of first Surveyor not accepted, second Surveyor  appointed — Appointment of second Surveyor not explained  

— Deficiency in service proved — Report of first Surveyor  upheld.…‟  

and the investigator in the instant case submitted his report  on 28-12-1998 i.e. almost 8 months after his appointment.  Taking into consideration all the above submissions, we are  of the considered opinion that the appellant complainant  

was able to establish that there was shortage/damage to the  consignment which was given to the second respondent for  

transportation.‟  

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20. Though the said aspect has not been gone into by the  National Commission, yet we find, the findings recorded by  

the State Commission are absolutely justified and tenable in  law being based on materials brought on record, in such a  

situation we do not think it appropriate that an exercise of  remit should be carried out asking the National    Commission to have a further look at it. In any case, the  

exercise of revisional jurisdiction by the National  Commission is a limited one. We may hasten to add that to  satisfy ourselves, we have perused the surveyor’s report  

and scrutinised the judgment and order passed by the  State Commission in this regard and we are completely  

satisfied that the determination made by it is absolutely  impeccable.”  

(emphasis supplied)  

17. In the present case,  it is common ground that the letter  

of repudiation dated 18th February, 2005 elucidates that the  

claim of the appellant was rejected on the ground that neither  

the intimation of the loss had been given to it immediately  

after the loss nor were the requisite particulars of the loss  

conveyed within stipulated period and there was breach of  

terms and conditions of Clause 6 of the general conditions of  

the policy. Additionally, the surveyor report predicates that it  

was very difficult to estimate the damages for the reasons  

mentioned therein and that the claim of the appellant was not  

payable on account of breach of Clause 6 of the general  

conditions of the policy. That recommendation commended to

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the respondent. It has been so incorporated in the letter of  

repudiation dated 18th February, 2005.   

18. The respondent has rightly pointed out the other  

distinguishing features in the present case. To wit, in that case  

[Galada (supra)], the Court had considered Clause 5 of a  

Marine Insurance Policy wherein the issue was whether the  

insurance cover itself had extinguished by efflux of time and  

that the intimation given by the insured to the insurer was not  

made within 7 days of arrival of the vehicle at the destination  

mentioned in the policy. According to the insurer, on expiry of  

7 days from delivery the insurance cover stood perished and  

no cover would subsist beyond the said 7 days period. It is in  

that context, the Court noted that appointment of the surveyor  

by the insurer beyond the said period can be construed as an  

act of  waiver by the insurer of the position that the policy  

stands extinguished. In other words, appointment of a  

surveyor by the insurer was interpreted as a manifestation of  

the stand of the insurer that the insurance cover still subsists.  

This is evident from the dictum in paragraph 13 of the

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reported decision as the Court noted that once a surveyor was  

nominated to verify the loss, the insurer could not be allowed  

to take a stand that the claim is hit by the clause pertaining to  

duration and moreso because of absence of any mention in the  

letter of repudiation.  Thus,  it went on to hold that from the  

positive conduct of the insurer in unequivocally  appointing a  

surveyor, the insurer had waived the right which was in its  

favour under the duration clause.   

 19. The expression “duration” is of some significance which  

is reflective of the existence or otherwise of the policy itself. In  

the present case, there is no dispute about the subsistence of  

the policy but is one of violation of condition No.6 of the policy.  

Furthermore, in the present case the controversy will have to  

be answered on the basis of Standard Fire and Special Perils  

Policy relatable to condition No.6 obligating the insured to give  

forthwith intimation of the loss to the insurer. The two clauses  

are materially different and relate to two different and distinct  

insurance policies. In other words, Clause 5 of the Marine

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Insurance Policy and Clause 6 of the present policy are  

incomparable being qualitatively different.  

 20. To put it differently, Galada’s case (supra) was not a case  

which considered repudiation based on a premise or a reason  

similar to condition No.6 of the present policy and a specific  

plea taken by the insurer in that behalf in the repudiation  

letter itself. Notably, Clause 5 of the Marine Insurance Policy  

which was the subject matter in Galada’s case (supra) did not  

have a negative covenant as in this case in the proviso to  

condition No.6 of the subject policy. The fulfillment of the  

stipulation in Clause 6 of the general conditions of the policy  

is the sine qua non to maintain a valid claim under the policy.  

 21. We, therefore, agree with the respondent that the dictum  

in Galada’s case (supra) is in the context of the facts of that  

case and does not lay down that on the appointment of a  

surveyor, per se, the insurer is estopped from raising a plea of  

violation of the condition warranting a repudiation of the  

claim. The factum of waiver has to be gathered from the  

totality of the obtaining circumstances.  

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 22.  Suffice it to observe that Galada’s case (supra) will be of  

no avail to the facts and circumstances of the present case. In  

that, the event occurred on 4th August, 2004 but intimation  

was given to the insurer only on 30th November, 2004 after a  

gap of around 3 months 25 days. No explanation was offered  

for such a long gap muchless plausible and satisfactory  

explanation. The stipulation in condition No.6 of the policy to  

forthwith give notice to the insurer is to facilitate the insurer  

to make a meaningful investigation into the cause of damage  

and nature of loss, if any.  This Court in Parvesh Chander  

Chadha (supra) has held that it is the duty of insured to  

inform the loss forthwith after the incident.   

 23. The respondent has also invited our attention to the fact  

that in Galada’s case (supra), this Court has had no occasion  

to consider the efficacy of Insurance Surveyors and Loss  

Assessors (Licensing, Professional Requirements and Code of  

Conduct) Regulations, 2000, which came into effect from 14th  

November, 2000. For, the claim in Galada’s case (supra) arose  

in 1998 and the repudiation took place in 1999. By virtue of

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the regulations, it is mandatory to appoint a surveyor on  

receipt of intimation about the loss; and the surveyor so  

appointed has to discharge his responsibilities and duties  

specified in the regulations while submitting its report.   

 24. Thus, the appointment of a surveyor by the respondent  

after receipt of intimation of the loss from the appellant, in the  

context of the present insurance policy, coupled with the 2000  

Regulations and in particular an express stand taken in the  

repudiation letter dated 18th February, 2005 sent by the  

respondent to the appellant after consideration of the  

surveyor‟s report, it cannot be construed to be a case of waiver  

on the part of the respondent.   

25. The appellant would then contend that the respondent  

did not take a plea that the surveyor was appointed because of  

statutory obligation. Such a plea is raised for the first time  

before this Court. Even this submission does not commend us.  

For, that plea has been taken as an additional factor to  

distinguish the decision in Galada’s case (supra). The party is  

not expected to state the provisions of law in its pleading. The

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fact that such obligation flows from the regulation, in that  

sense, is a mixed question of fact and law. The fact remains  

that the respondent had appointed a surveyor to enquire into  

the entire matter and submit its report. The surveyor expressly  

recommended that the claim was not payable on account of  

the infringement of Clause 6 of the general conditions of the  

policy.  

 26. We also find no merit in the grievance made by the  

appellant that the Commission did not consider the issue of  

waiver for which the appellant was granted liberty to file  

review petition by this Court. We say so because we find that  

the Commission considered the said issue as the singular  

issue and after analysing relevant aspects concluded that  

there was nothing to indicate that the respondent insurer had  

intentionally or consciously relinquished or waived its right to  

reject the claim on delayed intimation of loss, by appointing a  

surveyor to assess the loss claimed by the insured. For the  

above reasons, the argument that the Commission has not

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analysed the said issue, as has been done by us, will make no  

difference to the conclusion recorded by it.   

 27. The appellant has also placed reliance on the decision in  

Om Prakash Versus Reliance General Insurance and  

Another,6 to contend that the genuine claim of the appellant  

ought not to be rejected on technical ground, keeping in mind  

that the Consumer Protection Act is a beneficial legislation  

warranting liberal construction. That contention cannot be  

taken forward at the instance of the appellant who has failed  

to fulfill the threshold stipulation contained in Clause 6 of the  

general conditions of the policy and for which reason must  

suffer the consequence. It is not a technical matter but sine  

qua non for a valid claim to be pursued by the insured, as  

agreed upon between the parties.   

 28. In view of the above, we uphold the conclusion of the  

Commission that the respondent (insurer) had not waived the  

condition relating to delay stipulated in Clause 6 of the general  

                                                           6 (2017) 9 SCC 724

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conditions of the policy, by appointing a surveyor. Accordingly,  

these appeals must fail.  

 29. The appeals are dismissed with no order as to costs.        

 .………………………….CJI.  

     (Dipak Misra)   

…………………………..….J.                (A.M. Khanwilkar)  

…………………………..….J.               (Dr. D.Y. Chandrachud)  

New Delhi;  

August 21, 2018.