Delhi District Court
Klj Plasticizers Limited vs Oriental Insurance Co. Ltd on 30 July, 2025
IN THE COURT OF Sh. RAJESH KUMAR GOEL
District Judge (Commercial Court) -02,
Central, Tis Hazari
DLCT010068082023
CS (COMM.) No. 829/2023
CNR No. DLCT010068082023
K.L.J Plasticizers Limited
through its Director
At: 8A, Shivaji Marg,
Moti Nagar,
New Delhi,
Delhi 110 015 ......Plaintiff
Versus
Oriental Insurance Co. Ltd
Through its Divisional Manager
A-25/27, Asaf Ali Road,
New Delhi - 110 002 ......Defendant
Date of filing of suit : 18.05.2023
Date of Argument : 23.07.2025
Date of Judgment : 30.07.2025
JUDGMENT
Prologue
1. There are thirteen connected cases pending
before this Court wherein principally the parties are
Digitally
signed by
RAJESH RAJESH the same. In all the aforesaid cases, the main
KUMAR GOEL
KUMAR Date:
GOEL 2025.07.30
17:12:24
+0530M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 1 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
dispute between the parties is whether loss of
quantity(s) in question is/are covered under the
Insurance policy(s) or not ? Further, in most of the
cases, the evidence led by the parties, arguments
and contentions are absolutely identical and similar.
Rather in a few cases, even the cross examination
of the witnesses appears to be photocopies. Further,
reference to the provisions of law and judicial
authorities is also the same, therefore, this judgment
in a way, would be reproduction of the same
judgment in all the thirteen cases after making few
cosmetic changes regarding the insurance cover
notes, insurance policies, details of consignment
and surveyor reports etc.
2. Here it is pertinent to mention that in the
present case the evidence of both the parties has
been recorded by the Ld. Court Commissioner
appointed by the Ld. Predecessor of this Court.
From the records of these cases, it is evident that
even those documents have been given exhibit
mark which are either dim or absolutely dark and
not legible. It was the duty of the Ld. Court
Commissioner to ask the party concerned to
provide the legible copies. During the Final
arguments, Ld. Counsel for the plaintiff was asked
to provide the legible copies of such documents, so
M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 2 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
that the same may be considered. This court is not
happy with the way Ld. Court Commissioner has
recorded the evidence. Be that as it may, this Court
tried its best to consider the documents as relied
upon by the parties for adjudicating the dispute
effectively between them.
3. Vide this judgment, I shall dispose of the
present suit for recovery of Rs 5,24,572/- (Rs Five
lakhs Twenty Four Thousand Five Hundred and
Seventy Two only) filed by the plaintiff company
against the defendant company alleging that the
defendant company has wrongfully rejected the
insurance claim of the plaintiff company.
Factual Matrix
4. The brief facts of the case, as made out from
the plaint are that the plaintiff company is stated to
be a company registered under the companies Act,
1956, and is engaged in manufacturing of
plasticizers and allied items and also in
import/export of various types of chemicals/
petrochemicals; as a matter of business prudence,
the plaintiff company would insure all its
consignments to be imported against the various
transit risk under ‘All Risk Insurance Policy’.
5. It is the case of the plaintiff company that in
M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 3 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
order to protect its Chemicals/petrochemicals to be
imported by the plaintiff company against any kind
of loss or damages during transit, plaintiff company
had obtained insurance cover from the defendant
company, who is stated to be a leading insurance
company of the country in public sector and also a
Body incorporated and registered under the
Companies Act,1956; defendant company issued
cover note in respect off the consignment by
providing cover for all kind of transit risks from
Anywhere in the world to Anywhere in India via
any Indian Port on shore tank to shore tank basis.
6. The details of the said cover note and
insurance policy issued by the defendant company
is as under:
Cover Note No. Policy No.
308912 272200/21/2012/1020
7. It is stated that the aforesaid cover note and
insurance policy was issued by the defendant
company in respect of the following consignment:
Invoice No. Dated Quantity Ship Name Delivery
Port
92023067 25.11.2011 440.00 CHEM KANDLA
MT ROUTE
OASIS
8. It is the further case of the plaintiff company
that the plaintiff company received a short quantity
M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 4 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
of the consignment and has suffered loss.
According to the plaintiff company, the unloading
of the consignment was done under the supervision
of the Insurance Surveyors; defendant company
after obtaining the report of first surveyor, had
deputed second surveyor for the same loss and had
obtained another report; the surveyors in their
reports confirmed the loss due to short quantity
received by the plaintiff company. The details of
the Surveyor report is as under:
Surveyor Dated 2nd Short Claim Claim Bill Short Claim
Report Surve Quantity Intimation Quantity amount
Ref. No. yor Letter to
report Ins. Co.
Ref.
No.
JB 20.12.20 NA 5.995 23.01.202 23.01.201 5.995 255469
Boda- 11 MT 1 2 MT
KDL/04
119/11/
AA
9. The plaintiff company is said to have lodged
its claim for shortage of the said material to the
Ship’s agents also vide their letters and then to the
defendant company in respect of the aforesaid loss.
10. It is stated that the defendant company did
not settle the claim of the plaintiff company despite
the reminders having been sent by the plaintiff
company and instead rejected the claim of the
plaintiff company on the ground that under the
insurance policy, the defendant company has noM/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 5 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
liability as the same being beyond the scope of
insurance policy taken by the plaintiff company.
11. According to the plaintiff company, the
plaintiff company had taken the insurance policy
“All Risk Policy” covering all kind of losses
without any exception, therefore, the shortage of
material would come within the scope of insurance
policy and the defendant company is under
statutory obligation to indemnify the plaintiff
company to the extent of the loss which has been
suffered by the plaintiff company.
12. Another set of facts, as emanate from the
plaint, is that after rejection of the claim by the
defendant company, plaintiff company had
approached District Consumer Dispute Redressal
Forum, Central, Delhi (hereinafter referred to as
“District Forum”); the claim of the plaintiff
company was returned by the District Forum as it
was observed that it lacked pecuniary jurisdiction;
plaintiff company then approached the National and
State Commission seeking redressal and
consequently the complaint was returned to the
District Forum by the State Commission; the entire
process of trial was repeated at the District Forum;
District Forum observed that the claim/complaint
filed by the plaintiff company is not maintainable
M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 6 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
as it was the business to business transactions and
is not covered under the Consumer Protection Act
1986; District Forum is said to have been apprised
of by the plaintiff company that pursuant to the
judgment of National Commission, the claim was
maintainable but despite that the complaint of the
plaintiff company was returned.
13. It is also stated that the claim/complaint of
the plaintiff company was never dealt with by the
District Forum on merits, therefore, the plaintiff
company is entitled for the benefit under section 14
of the Limitation Act for which a separate
application has been filed and the case of the
plaintiff company fall within the prescribed period
of limitation and is maintainable.
14. It is stated that since the claim of the plaintiff
company was rejected wrongly by the defendant
company, therefore the defendant company is liable
to pay the interest @ 12% p.a from the date of
repudiation i.e. 22.07.2014 till 30.04.2023 to the
extent of Rs 2,69,103/-. According to the plaintiff
company a total amount of Rs 5,24,572/- (Rs
2,55,469/- as Principal + Rs 2,69,103/- as Interest)
is due and outstanding against the defendant
company.
15. In compliance of the provision of section
M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 7 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
12A of the Commercial Courts Act, 2015, as
amended to date, the plaintiff company filed a pre-
litigation mediation application before the Delhi
Legal Service Authority, Central District, Tis
Hazari Courts, Delhi, (in short “DLSA”) against the
defendant company; the DLSA has released a non-
starter report dated 11.04.2023.
16. Summons of the suit were issued to the
defendant company. The defendant company made
the appearance and has filed the written statement.
17. Since, there was a delay of a few days in
filing the written statement, therefore, an
application under order VIII rule 1 CPC was moved
on behalf of the defendant company seeking
condonation of delay, which was allowed vide
order dated 3.8.2023 by the Ld. Predecessor of this
Court and the written statement filed by the
defendant company was taken on record.
18. In the written statement, the defendant
company has taken certain preliminary objections
to the effect that this court does not have territorial
or pecuniary jurisdiction; the present suit is liable to
be dismissed as the suit of the plaintiff company is
barred by limitation as the loss was reported by the
plaintiff company and came to be rejected by the
defendant company on 22.07.2014, whereas the
M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 8 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
present suit was filed in the year 2023; the present
suit is bad for non-joinder of necessary and proper
party and is liable to be rejected as shipping agent
should have been made a party etc.
19. On the merits, the defendant company has not
denied that the plaintiff company had taken the
insurance policy in question but the stand of the
defendant company is that the claim of the plaintiff
company is not payable as the alleged loss of
quantity reported by the plaintiff company neither
come within the scope of coverage under the
insurance policy nor payable under the terms and
conditions of the Marine Cargo Single Voyage
(Sea) Policy-Institute Cargo Clauses (A).
According to the defendant company, there was no
evidence of any insured marine peril activated
when the cargo was pumped from shore tank to
ship tank at the time of loading and the ship tank to
the shore tank at the time of discharge; defendant
company has alleged that shortage was not due to
any insured peril and hence the defendant company
has no liability under the insurance policy,
therefore the claim of the plaintiff company was
rejected.
20. It is the further stand of the defendant
company that the Marine Cargo Policy makes it
M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 9 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
crystal clear that company insures against loss or
damage or expenses subject to clauses,
endorsements, conditions and warranties mentioned
in the schedule and attached thereto which
included Institute Cargo Clause-A. By referring to
clause 4.2 of the Institute Cargo Clause A, it is
stated that in no case shall this insurance cover for
ordinary leakage, ordinary losses, weight or volume
and ordinary wear and tear of the subject matter
insured.
21. The defendant company has also referred to
the report of the surveyor and it was stated that the
cause of shortage is attributed to the transfer of
goods from shore tank to the ship’s tank at the port
at the time of loading and discharge. It is also stated
that the alleged shortage, as reported by the plaintiff
company, is a normal phenomenon in transit of
chemicals by ship and the actual shortage would be
found to be an ordinary leakage or ordinary loss in
weight or volume, which is as per the nature of the
subject matter insured. Hence the present suit of the
plaintiff company is liable to be rejected.
22. The defendant company has filed an affidavit
of admission and denial of the documents along
with the written statement.
M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 10 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
23. Thereafter, the plaintiff company filed the
rejoinder to the written statement of the defendant
company denying the allegations made by the
defendant company and reiterated the facts as
mentioned in the plaint. Along with the rejoinder ,
the plaintiff company has also filed the statement of
admission and denial of documents.
24. After completion of pleadings, vide order
dated 18.10.2023, following issues were framed by
the Ld. Predecessor of this Court:-
1. Whether this court has no territorial Jurisdiction
as well as Pecuniary Jurisdiction to try the present
suit, as alleged by defendant in the written statement
( Para 1-Preliminary Objections)? (OPD)
2. Whether the present suit is not maintainable being
barred by Limitation, as alleged by the defendant in
the written statement (Para 2-Preliminary Objections)
? (OPD)
3. Whether the suit is bad for non-joinder of
necessary parties, as alleged by the defendant in the
written statement ( Para 3- Preliminary Objections)?
(OPD)
4 Whether the plaintiff is entitled to recovery of the
principal amount, as asked for in plaint? (OPP)
5. In case if issue no. 4 is decided in affirmative,
whether the plaintiff is entitled for any interest, as
asked for in the plaint? (OPP).
6. Relief
25. Vide order dated 29.11.2023, the Schedule of
Second Case Management hearing was fixed by the
Ld. Predecessor of this court and Ld. Court
Commissioner was appointed to record the
M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 11 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
evidence of both the parties.
26. The Ld. Court Commissioner has already
submitted his report to this court.
27. In support of its case, the plaintiff company
has examined two witnesses i.e. PW1 Ashok
Kumar Maharshi, an officer in the plaintiff
company and PW2 Satish Kumar, ASO from
District Forum. No other witness was examined by
the plaintiff company and the plaintiff evidence was
closed.
28. The defendant company has examined one
Smt Renuka Chaudhary, Manager, as DW1, who
has filed her evidence by way of affidavit and
Sh.S.K Chakraborty, surveyor as DW2. No other
witness was examined by the defendant company
and the defendant’s evidence was closed.
29. PW1 Ashok Kumar Maharshi has deposed on
the lines of the averments made in the plaint in his
evidence filed by way of affidavit Ex.PW1/A. He
also relied upon the documents i.e Board
Resolution dated 10.11.2022 ExPW1/1, Copy of
Memorandum and Articles of Association of the
Plaintiff company ExPW1/2 (colly). Copy of Final
Order dated 24.03.2017 of the Consumer
Complaint filed by plaintiff Ex-PW-1/3 (Colly),
M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 12 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
Copy of Status Report and order dated 05.04.2019
of the Consumer Appeal filed by plaintiff before
State Commission Delhi Ex-PW-1/4 (Colly), Copy
of Order dated 09.02.2022 of the Consumer District
Commission Ex-PW-1/5 (Colly), Copy of
Complaint with supporting affidavit in Policy No.
272200/21/2012/1020 Filed By Plaintiff Co. before
Consumer Forum, Central, Delhi Ex-PW-1/6
(Colly), Copy of Board Resolution dated
27.08.2015 Filed By Plaintiff Co. before Consumer
Forum, Central, Delhi Ex-PW-1/7, Copy of
Insurance Cover note no. 308912 Ex-PW-1/8, Copy
of Insurance Policy 272200/21/2012/1020 Ex-
PW-1/9 (Colly), Copy of Invoice No. 92023067
Dated 25.11.2011 Ex-PW-1/10, Copy of Bill of
Lading No. B/L No. 260(B), B/L No. 260(B)-1
Dated 25.11.2021 Ex-PW-1/11 (Colly), Copy of
warehouse bill of entry and Survey Report dated
20.12.2011 Ex-PW-1/12 (Colly), Copy of Letter dt
12.01.2012 sent by plaintiff to shipping agent and
Copy of Letter dt 23.1.2012 sent by plaintiff to
defendant Ex-PW-1/13 (Colly), Copy of Letter dt
23.1.2012 along with claim bill sent by plaintiff to
defendant Ex-PW-1/14 (Colly), Copy of Letter dt
28.08.2012, 24.03.2014, 17.07.2014 sent by
plaintiff to defendant Ex-PW-1/15 (Colly), Copy of
repudiation letter dt. 22.07.2014 received by the
M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 13 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
plaintiff from the defendant Ex-PW-1/16 (Colly),
Copy of Written Statement filed by defendant
before consumer forum Ex-PW-1/17 (Colly).
30. PW2 Satish Kumar is a summoned witness
from District Forum, Kashmere Gate, who
produced the original diary register of 10.09.2015
to 13.05.2016 having reference of CC No.91/2016
ExPW2/1.
31. PW2 Satish Kumar was not cross examined
by the Ld. Counsel for the defendant company
despite opportunity being given.
32. DW1 Renuka Chaudhary tendered her
evidence by way of affidavit ExDW-1/A and has
deposed on the lines of stand taken in the written
statement filed by the defendant company. She has
relied upon the documents i.e Power of attorney
ExDW1/1, the Institute Cargo Clauses (A) is
ExDW1/2.
33. DW1 Renuka Chaudhary was cross examined
on behalf of the plaintiff company.
34. DW2 S.K Chakraborty, Surveyor was also
examined by the defendant company who also filed
his evidence by way of affidavit ExDW2/A and
has relied upon Survey report dated 24.03.2012
M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 14 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
ExDW2/1.
35. DW2 S.K Chakraborty was cross examined
on behalf of the plaintiff company.
36. Here, it is pertinent to mention that at the
stage when evidence of the defendant company has
already been recorded, the defendant company
moved an application under order 16 Rule (1) (3)
r/w section 151 CPC making a request to summon
additional witnesses to be examined by the
defendant company. Vide aforesaid application
defendant company wanted to produce and prove
“Institute Cargo Clauses (A) as applicable to Marine
Cargo- Single Voyage (Sea) Policy”.
37. The said application moved on behalf of the
defendant company was allowed by this Court vide
order dated 27.04.2024 subject to the cost whereby
the defendant company was allowed to summon the
concerned witness. Pursuant to the summons issued
by the court, one Sh. R.Pardha Saradhi appeared on
06.5.2024, and he was examined as DW2 in another
connected case bearing no. 763/2023. In that case,
he proved the Institute Cargo Clauses (A) as
applicable to Marine Cargo- Single Voyage (Sea)
Policy as Ex DW2/A.
38. Both the parties made a request to place the
M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 15 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
copy of the said document ExDW2/A in each of the
files, including the present case and it was stated
that in that eventuality there would not be any need
to examine the witness Sh. R. Pardha Saradhi as
one of the defendant witnesses in each and every
case. It was also stated on behalf of both the parties
that they do not have any objection, if the said
document ExDW2/A is read and considered into
evidence while deciding the case at the time of final
hearing.
39. Considering the request of both the parties
and no objection from their side, the copy of
Institute Cargo Clauses (A) as applicable to Marine
Cargo- Single Voyage (Sea) Policy ExDW2/A, was
directed to be placed in each of the cases pending
between the parties including the present one and it
was directed that same shall be read in evidence at
the stage of final disposal of the cases.
Accordingly, the present case reached the stage of
final arguments.
40. Ld. Counsels for both the parties have filed
the written synopsis of arguments and have argued
the matter orally as well at length. Their arguments
shall be considered while giving the findings on the
issues.
41. Ld. Counsel for the plaintiff company has
M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 16 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
relied upon the following judicial pronouncements:-
a) M.P Steel Corporation Vs Commissioner of
Central Excise, (2015) 7 SCC 58
b) Saurashtra Chemicals Ltd vs National Insurance
Company Ltd , (2019) 19 SCC 70.
c) Bharat Watch Company Vs NIC (2019) 6 SCC
212.
d) National Insurance Company Ltd Vs
Mangalagowri Cashew Industries, II (2006)
CPJ-32 (National Commission)
(State Commission Mumbai), Appeal No.
A/16/2917
f) Texco Marketing Pvt Ltd vs Tata AIG Capital
General Insurance Company Ltd and Ors, IX
(2022) SLT 144
g) Narsingh Ispat Ltd Vs OIC Capital, 2022 SCC
OnLine SC 535.
h) Mavji Kanji Jungi & Anrs vs Oriental Insurance
Company Ltd. I (2021) CPJA 435 ( National
Commission)
i) Mappie International Ltd Vs Oriental Insurance
Co. Ltd, (NCDRC, New Delhi ) CC N. 5 of 2015
j) Sri Venkaterswara Syndicate Vs. Oriental
Insurance Co. Ltd II (2010) SLT 664
42. Ld. Counsel for the defendant company has
relied upon the following judicial authorities:
a) House of Lords in case of British and Foreign
Marine Insurance Co. Ltd Vs. Gaunt ( 1921) 2 AC
41 (HL)
b) New India Assurance Co. Ltd Vs Hira Lal Ramesh
Chand and Ors, AIR 2008 SC 2620
c) Josita Antony vs New India Assurance Company
Ltd, II (2006) ACC 713
d) J.M.F Sea Foods, Alleppey and Ors vs National
Insurance Co. Ltd, Alleppey, AIR 1992 Ker 202.
e) Bajaj Allianz General Insurance Co. Ltd and Ors
M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 17 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
Vs The State of Madhya Pradesh , AIR 2020 SC
2237.
f) General Assurance Society Ltd vs Chandumull
Jain and Anr. , 1966 (3) SCR 500
g) Consolidated Engineering Enterprises vs Principal
Secretary, Irrigation Department and Ors ( 2008) 7
SCC 169.
h) Ghasi Ram & Ors Vs Chait Ram Saini & Ors
(1998) 6 SCC 200.
i) Maidi Bhikashmiah & Anrs Vs. Venugopalrao &
Ors, 1958 SCC OnLine AP 206.
j) Hassan Chand & Sons Vs H.H Majaraja Shri Gaj
Singh, 1961 SCC OnLine Raj 125.
k) Sohan Singh Vs State of Rajasthan & Ors, 1977
WLN (UC) 96.
l) Bihar Supply Syndicate Vs Asiatic Navigation
(1993) 2 SCC 639
m) Oriental Insurance Company Ltd Vs Peacock
Plywood (P) Ltd. 2004 SCC OnLine Cal 681.
43. I have gone through the material available on
record and heard the Ld. Counsel for both the
parties. I have also gone through the case laws cited
at bar.
Issue No.1
Whether this Court has no Territorial
Jurisdiction as well as Pecuniary Jurisdiction
to try the present suit, as alleged by defendant
in the written statement? (OPD)
44. During the arguments, on the query being
raised by this court to the Ld. Counsel for the
defendant regarding the issue of territorial
jurisdiction, Ld. Counsel for the defendant
submitted that he is not pressing the said issue and
the same may be disposed off accordingly.
M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 18 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
45. The plaintiff company has filed the present
suit for recovery of Rs 5,24,572/- (Rs Five Lakhs
Twenty Four Thousand Five Hundred and Seventy
Two only) against the defendant company, which is
well within the pecuniary jurisdiction of this court.
Further, the address of the defendant company, as
per memo of parties is of Asaf Ali Road, New
Delhi 110002, which falls within the jurisdiction of
this court. There is no dispute that cause of action
also arose within the jurisdiction of this court.
Although, the Ld. Counsel for the defendant has not
pressed this issue, however, even otherwise also, as
discussed herein above, this court has the territorial
and pecuniary jurisdiction to try and entertain the
present suit. Hence, issue no.1 is answered
accordingly.
Issue no.2
Whether the present suit is not maintainable
being barred by Limitation, as alleged by the
defendant in the written statement? (OPD)
46. In the written statement, one of the objections
taken by the defendant company is that the suit
filed by the plaintiff company is barred by
limitation. Ld. Counsel for the defendant company
submitted that it is not in dispute that the claim of
the plaintiff company was rejected on 22.7.2014;
the present suit was filed in the year 2023 which is
M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 19 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
beyond the period of limitation. He further
submitted that the plaintiff company cannot be
given the benefit of section 14 of the Limitation
Act,1963 as neither the relief to file the fresh suit
was sought by the plaintiff company nor was
granted by the Ld. District Forum; the present
proceedings are distinct from the proceedings
which took place before the consumer forum; the
period of limitation in both the said proceedings is
different; the proceedings before the consumer
forum were not prosecuted diligently and in good
faith and the plaintiff company was well aware that
the case of the plaintiff company would not fall
under the definition of consumer; By referring to
the order passed by the Consumer Forum, Ld.
Counsel for the defendant company submitted that
the complaints of the plaintiff company were
dismissed vide order dated 09.2.2022. The plaintiff
company approached the Pre-Litigation Mediation
on 11.01.2023, therefore, the protection as available
u/s 14 of the Limitation Act would not be available
to the plaintiff company.
47. In reply to that Ld. Counsel for the plaintiff
company submitted that the claim of the plaintiff
company was repudiated vide communication dated
22.07.2014; plaintiff company filed the complaint
M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 20 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
case before the District Forum on 25.02.2016 which
was finally returned on 09.02.2022. He further
submitted that the copy of the order of District
Forum dated 09.2.2022 was received by the
plaintiff company on 07.03.2022, therefore, the
period from 25.02.2016 to 07.3.2022 spent before
the District Forum has to be excluded. He further
submitted that the plaintiff company had diligently
followed up its complaint before the Consumer
Forum and there were repeated rounds of litigations
about the maintainability of the complaint; the
complaint was returned vide order dated 09.2.2022;
the defendant company admitted the part of the said
processes and has participated in the same before
the Consumer Forum and the Consumer Forum had
not adjudicated the dispute on merits. He further
submitted that the relief sought by the plaintiff
company before Consumer Forum and before this
court is identical and in a separate application
moved u/s 14 of the Limitation Act, the plaintiff
company has given details indicating how the
present suit is within limitation. He further
submitted that the time spent by the plaintiff
company before the Consumer Forum has to be
excluded.
48. It will be relevant to refer to Section 14 of the
M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 21 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
Limitation Act, which reads as under:-
“14. Exclusion of time of proceeding bona fide
in court without jurisdiction.–(1) In
computing the period of limitation for any suit
the time during which the plaintiff has been
prosecuting with due diligence another civil
proceeding, whether in a court of first instance
or of appeal or revision, against the defendant
shall be excluded, where the proceeding
relates to the same matter in issue and is
prosecuted in good faith in a court which, from
defect of jurisdiction or other cause of a like
nature, is unable to entertain it.
(2) In computing the period of limitation for
any application, the time during which the
applicant has been prosecuting with due
diligence another civil proceeding, whether in
a court of first instance or of appeal or
revision, against the same party for the same
relief shall be excluded, where such
proceeding is prosecuted in good faith in a
court which, from defect of jurisdiction or
other cause of a like nature, is unable to
entertain it.
(3) Notwithstanding anything contained in
Rule 2 of Order 23 of the Code of Civil
Procedure, 1908 (5 of 1908), the provisions of
sub-section (1) shall apply in relation to a fresh
suit instituted on permission granted by the
court under Rule 1 of that Order, where such
permission is granted on the ground that the
first suit must fail by reason of a defect in the
jurisdiction of the court or other cause of a like
nature.
Explanation.–For the purposes of this section–
(a) in excluding the time during which a
former civil proceeding was pending, the day
on which that proceeding was instituted and
the day on which it ended shall both be
counted;
(b) a plaintiff or an applicant resisting an
appeal shall be deemed to be prosecuting a
proceeding;
M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 22 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
(c) misjoinder of parties or of causes of action
shall be deemed to be a cause of a like nature
with defect of jurisdiction.”
49. Section 14 of the Limitation Act deals with
exclusion of time of proceeding spent bona fide in
a court without jurisdiction. On analysis of the said
section, it becomes evident that the following
conditions must be satisfied before Section 14 can
be pressed into service:
(1) Both the prior and subsequent proceedings
are civil proceedings prosecuted by the same
party;
(2) The prior proceeding had been prosecuted
with due diligence and in good faith;
(3) The failure of the prior proceeding was due to
defect of jurisdiction or other cause of like nature;
(4) The earlier proceeding and the latter
proceeding must relate to the same matter in issue
and;
(5) Both the proceedings are in a court.
50. Here I may refer to a few judgements
touching the controversy in question qua limitation.
In the case of Laxmi Engineering Works vs P.S.G.
Industrial Institute,1995 SCC (3) 583, the following
order of National Commission dated 07-12-1993
was assailed before Hon’ble Supreme Court:-
“From the facts appearing on record it is
manifest that the complainant is carrying on
the business of manufacture of machine parts
on a large scale for the purpose of earning
profit and significantly one single item of
machinery in respect of which the complaint
petition was filed by him before the State
Commission itself is of the value of Rs. 21M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 23 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
lakhs and odd. In the circumstances, we fail to
see how the conclusion can be escaped that
the machinery, in question which is alleged to
be defective was purchased for a commercial
purpose. Hence, the complainant is not
entitled to be regarded as a consumer and the
complaint petition filed by him was not
maintainable before the State Commission. He
order passed by the State Commission is set
aside. The complaint petition is dismissed.”
The National Commission, however, observed
that their order does not preclude the appellant
from pursuing his remedy by way of ordinary
civil suit.”
51. In that case Hon’ble Supreme Court
observed as under:-
“25.So far as the present case is concerned we
must hold (in agreement with the National
Commission), having regard to the nature and
character of the machine and the material on
record that it is not goods which the appellant
purchased for use by himself exclusively for
the purpose of earning his livelihood by
means of self employment, as explained
hereinabove.
26.The appeal accordingly fails and is
dismissed but without costs. If the appellant
chooses to file a suit for the relief claimed in
these proceedings, he can do so according to
law and in such a case he can claim the
benefit of Section 14 of the Limitation Act to
exclude the period spent in prosecuting the
proceedings under the Consumer Protection
Act, while computing the period of limitation
prescribed for such a suit.”
52. In a similar case of Saushish Diamonds Ltd. vs
National Insurance Co. Ltd.,(1998) 8 SCC357, the
appellant had approached the National Consumer
Disputes Redressal Commission for recovery of the
M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 24 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
loss of diamonds entrusted to the Commission
Agent. The National Consumer Disputes Redressal
Commission, New Delhi in its order dated 28-9-
1995 passed the order holding that since the
Insurance Company has repudiated the claim, it
declined to grant the relief. Thus, an appeal was
preferred before the Hon’ble Supreme Court.:-
“2. Shri Harish Salve, the learned Senior
Counsel for the appellant, contended that in
view of the policy undertaken by the
respondent, the Commission could have
granted the relief, instead of relegating the
appellant to a civil action. We find no force in
the contention. We have gone through the
stand taken by the respondent in the
repudiation. The very interpretation of the
policy itself is a subject-matter of the dispute.
Under these circumstances, the Commission
rightly relegated the parties to a civil action. It
is true that limitation has run out against the
appellant during the pendency of the
proceedings. Therefore, the time taken
between the date of the filing of the claim
before the Commission and the date of its
disposal, namely, 28-9-1995 would be
considered by the civil court for exclusion
under Section 14 of the Limitation Act, 1963.
The appeal is accordingly dismissed.”
53. In Basheer Ahmed Noor-ul-Hussain Farooqui
Vs. Shaikh Hamad, MANU/MH/1527/2021, the
Hon’ble High Court of Bombay, while considering
the contentions regarding the applicability of
section 14, Limitation Act upon the time spent by
the plaintiff bona fide before a Court without
jurisdiction. It was held:-
“It is thus material to note, that the District
M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 25 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
Consumer Forum, had entertained the plea of
the plaintiff for a direction to the defendant to
execute the sale deed upon the receipt of the
balance consideration and had issued an
according direction. It is quite another matter
altogether, that the State Commission by its
order dated 04.01.2010, dismissed the claim of
the plaintiff and directed him to approach the
Civil Court which order was confirmed by the
National Commission on 14.03.2011
immediately after which the plaintiff
approached the Civil Court on 13.04.2011 with
the suit for specific performance. The very fact
that the District Forum, had ruled in favour of
the plaintiff would indicate that the plaintiff
had prosecuted the remedy before the
Consumer Forum diligently and bonafidely. In
a series of decisions, namely, Laxmi
Engineering Works; Saushish Diamonds Ltd.;
M/s Deokar Exports Pvt. Ltd. and Shangrilla
Apartments Co-Operative Housing Society ltd
(Supra), it has been held, that prosecution of a
remedy before the Consumer Forum, would be
a legal and valid ground, to invoke and apply
the provisions of Section 14 of the Limitation
Act. There is no reason whatsoever, why the
same benefit, cannot be granted to the
plaintiff, specifically in light of the fact, that
the District Consumer Forum in fact
entertained the plea of the plaintiff and had
granted relief. It therefore cannot be said that
prosecution of the remedy by the plaintiff
before the authorities under the Consumer
Protection Act was either malafide, or with
knowledge that the same was not
maintainable. Ramji Pandey (Supra) upon
which reliance has been placed by Mr.
Deshpande, learned counsel for the
respondent, is on a different footing altogether
as in that case, the initial institution of the suit
itself, was in the proper forum that is the Civil
Court and it was not a case where at the
inception, the proceedings were filed and
prosecuted in a forum which subsequently was
held to be without authority. The courts below,
have failed to consider the above position, in
light of the settled position of law, andM/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 26 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
therefore, the finding in this regard, cannot be
sustained. It is therefore held, that the suit as
filed by the plaintiff, was maintainable in view
of the availability and applicability of Section
14 of the Limitation Act, to the plaintiff, for if
the period spent before the Consumer Forum
and the Higher Authorities under the
Consumer Protection Act was subtracted, then
the suit filed by the plaintiff, was clearly
within the limitation as prescribed under
Section 54 of the Limitation Act.”
54. In the case of Purni Devi Vs Babu Ram , 2024
INSC 259, by referring to the cases of Consolidated
Engg. Enterprises vs The Principal Secretary (Irrigation
Department) & Ors, (2008) 7 SCC 169 and the case of
Sesh Nath Singh V. Baidyabati Sheoraphuli Coop Bank
Ltd, (2021) 7 SCC 313, Hon’ble Supreme Court
observed as under:-
34. The judgment of this Court in M.P. Steel
(Supra) discussed the phrases, “due diligence”
and “in good faith” for the purposes of
invocation of Section 14 of the Limitation Act.
While considering the application of Section 14
to the Customs Act, it was observed:
“10. We might also point out that Conditions
1 to 4 mentioned in the Consolidated Engg.
case have, in fact, been met by the Plaintiff.
It is clear that both the prior and subsequent
proceedings are civil proceedings prosecuted
by the same party. The prior proceeding had
been prosecuted with due diligence and in
good faith, as has been explained in
Consolidated Engg. [(2008) 7 SCC 169]
itself. These phrases only mean that the party
who invokes Section 14 should not be guilty
of negligence, lapse or inaction. Further,
there should be no pretended mistake
intentionally made with a view to delaying
the proceedings or harassing the opposite
party.
M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 27 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
49. ……. the expression “the time
during which the plaintiff has been
prosecuting with due diligence another
civil proceeding” needs to be construed
in a manner which advances the object
sought to be achieved, thereby
advancing the cause of justice.”
(emphasis supplied)
35. The judgments in Consolidated Engg.
Enterprises (Supra) and M.P. Steel (Supra) have
been followed consistently by this Court. For
instance in Sesh Nath Singh v. Baidyabati
Sheoraphuli Coop. Bank Ltd. 5 (2-Judge
Bench), while holding Section 14 to be
applicable to applications under Section 7 of the
Insolvency and Bankruptcy Code, 2016 and the
SARFAESI Act, it was observed:-
“75. Section 14 of the Limitation Act is to
be read as a whole. A conjoint and careful
reading of sub-sections (1), (2) and (3) of
Section 14 makes it clear that an applicant
who has prosecuted another civil
proceeding with due diligence, before a
forum which is unable to entertain the
same on account of defect of jurisdiction
or any other cause of like nature, is
entitled to exclusion of the time during
which the applicant had been prosecuting
such proceeding, in computing the period
of limitation. The substantive provisions
of sub-sections (1), (2) and (3) of Section
14 do not say that Section 14 can only be
invoked on termination of the earlier
proceedings, prosecuted in good faith.”
55. Here it would be relevant to refer to the
observation of the Hon’ble Supreme Court made in
the case of M.P. Steel Corporation (supra), which
M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 28 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
are as under:-
” 34. It now remains to consider the decision
of a 2-Judge Bench reported in P. Sarathy v.
State Bank of India, (2000) 5 SCC 355. This
judgment has held that an abortive proceeding
before the appellate authority under Section 41
of the Tamil Nadu Shops and Establishment Act
would attract the provisions of Section 14 of the
Limitation Act inasmuch as the appellant in this
case had been prosecuting with due diligence
another civil proceeding before the appellate
authority under the Tamil Nadu Shops and
Establishment Act, which appeal was dismissed
on the ground that the said Act was not
applicable to nationalized banks and that,
therefore, such appeal would not be
maintainable. This Court made a distinction
between “Civil Court” and “court’ and
expanded the scope of Section 14 stating that
any authority or Tribunal having the trappings
of a Court would be a “court” within the
meaning of Section 14. It must be remembered
that the word “Court” refers only to a
proceeding which proves to be abortive. In this
context, for Section 14 to apply, two conditions
have to be met. First, the primary proceeding
must be a suit, appeal or application filed in a
Civil Court. Second, it is only when it comes to
excluding time in an abortive proceeding that
the word “Court” has been expanded to include
proceedings before tribunals.
35. This judgment is in line with a large number
of authorities which have held that Section 14
should be liberally construed to advance the
cause of justice – see: Shakti Tubes Ltd. v. State
of Bihar, (2009) 1 SCC 786 and the judgments
cited therein. Obviously, the context of Section
14 would require that the term “court” be
liberally construed to include within it quasi-
judicial Tribunals as well. This is for the very
good reason that the principle of Section 14 is
that whenever a person bonafide prosecutes
with due diligence another proceeding which
proves to be abortive because it is without
jurisdiction, or otherwise no decision could beM/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 29 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
rendered on merits, the time taken in such
proceeding ought to be excluded as otherwise
the person who has approached the Court in
such proceeding would be penalized for no fault
of his own. This judgment does not further the
case of Shri Viswanathan in any way. The
question that has to be answered in this case is
whether suits, appeals or applications referred
to by the Limitation Act are to be filed in
courts. This has nothing to do with “civil
proceedings” referred to in Section 14 which
may be filed before other courts or authorities
which ultimately do not answer the case before
them on merits but throw the case out on some
technical ground. Obviously the word “court” in
Section 14 takes its colour from the preceding
words “civil proceedings”. Civil proceedings
are of many kinds and need not be confined to
suits, appeals or applications which are made
only in courts stricto sensu. This is made even
more clear by the explicit language of Section
14 by which a civil proceeding can even be a
revision which may be to a quasi-judicial
tribunal under a particular statute”.
56. Coming back to the case at hand, it is not in
dispute that initially the complaint of the plaintiff
company was returned by the District Forum vide
order dated 24.3.2017 ExPW1/3. From the order
dated 24.03.2017 ExPW1/3, it is evident that Ld.
District Forum observed that it has no pecuniary
jurisdiction to entertain the complaint filed by the
plaintiff company. The matter landed before
National Commission, then before State
Commission and finally vide order dated
09.02.2022, again the complaint of the plaintiff
company was returned by the District Forum vide
M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 30 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
order dated 09.2.2022 ExPW1/5 observing that
“the dispute raised by the complainant company as
involved in the instant case is a dispute between
“business to business” and is not covered under the Act
as observed by Hon’ble Apex Court in Laxmi Engg.
Works (Supra). The instant complaint is therefore
dismissed as not maintainable before Consumer
Commission under the Act”. From the said order it is
evident that District Forum had dismissed the
complaint of the plaintiff company on the ground
that the purpose of transaction between the parties
were commercial and the complainant ( plaintiff
company) is not a consumer under section 2 (1) (d)
of the Act. Meaning thereby, the District Forum did
not consider the complaint of the plaintiff company
on merits.
57. Having said so, there would be no difficulty
in arriving at a conclusion that the case of the
plaintiff company comes within the ambit of
section 14 of the Limitation Act. In the present case
it is not in dispute that the proceedings before the
District Forum were between the same parties i.e
M/s KLJ Plasticizers Ltd. vs The Oriental Insurance
Co. Ltd who are the plaintiff company and
defendant company respectively before this Court.
There would be no denial of the facts that the
proceedings before the District Forum were civil
M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 31 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
proceedings and so is the case before this Court.
There is nothing on record suggesting that the
plaintiff company had not prosecuted its complaints
with due diligence and in good faith. Assailing the
order of District Forum before the Appellate
Authority i.e State Commission and National
Commission indicates that plaintiff company was
diligent enough in prosecuting its claim before the
District Forum. The orders passed by the District
Forum, State Commission and National
Commission would make it further clear that the
plaintiff company had tried its best to get its claim
adjudicated by the District Forum. As noted herein
above the proceedings came to be dismissed by the
District Forum on technical grounds of jurisdiction.
Last but not the least, the issue between the parties
before the District Forum as well as before this
Court are the same i.e according to the plaintiff
company the repudiation of the claim of the
plaintiff company by the defendant company is
illegal.
58. In view of my aforesaid discussion and the
observations made in various judgments, as noted,
now it is no more res Integra that prosecution of a
remedy before the Consumer Forum, would be a
legal and valid ground, to invoke and apply the
M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 32 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
provisions of Section 14 of the Limitation Act.
There is no reason whatsoever why the same
benefit cannot be granted to the plaintiff company
in the present case. It is therefore cannot be said
that prosecution of the remedy by the Plaintiff
company before the authorities under the Consumer
Protection Act, 2019 was either malafide, or with
knowledge that the same was not maintainable.
Thus, the plaintiff company is entitled to exclusion
of the time during which the plaintiff company had
prosecuted its claim before the District Forum.
59. Having said so, now it is to be seen whether
the present suit has been instituted within the period
of limitation or not even after giving the benefits of
section 14 of the Limitation Act.
60. According to the plaintiff company, the claim
of the plaintiff company was repudiated by the
defendant company vide communication dated
22.07.2014 ExPW1/16 (colly). That being so, the
cause of action in the present case arose on
22.07.2014. Thus, the limitation period would start
from 23.07.2014.
61. In ordinary circumstances, the period of
limitation for filing the present suit for recovery
would have expired on 22.07.2017.
M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 33 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
62. In the present case, the plaintiff company has
filed a separate application under section 14 of the
Limitation Act seeking to exclude a certain period
while calculating the period of limitation and has
sought the benefit under section 14 of the
Limitation Act. According to the plaintiff company
as pleaded in the said application, the plaintiff
company is said to have preferred the complaints to
the District Forum on 25.02.2016. Meaning
thereby, the plaintiff company kept waiting during
the period from 23.07.2014 to 25.02.2016. Even as
per the case of the plaintiff company, the complaint
before the District Forum was filed after One year,
Seven Months and Three days. As per the case of
the plaintiff company, the last order passed by the
District Forum was of 09.02.2022 as the complaint
of the plaintiff company came to be dismissed or
returned on the ground of maintainability.
63. Pertinent to mention that during the
argument, Ld. Counsel for the plaintiff pointed out
that although the said order of the District Forum is
dated 9.2.2022, but it was prepared on 7.03.2022,
therefore, the period from 25.2.2016 to 07.03.2022,
has to be excluded. I do find support in the
aforesaid contention of the Ld. Counsel of the
plaintiff as from the record it is evident that the
M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 34 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
order dated 09.02.2022 appears to have been made
ready on 07.3.2022 and served on the plaintiff
company. Ld. Counsel for the defendant has not
disputed the same. That being so, the plaintiff
company has spent the time before the Consumer
Forum from 25.2.2016 to 07.03.2022 and that has
to be excluded in terms of section 14 of Limitation
Act.
64. The limitation period started from 23.07.2014
and it stopped on 25.02.2016 at the time when the
plaintiff company preferred to file a complaint
before the District Forum. The limitation would
again start w.e.f. 8.3.2022 i.e. one day after the day
when the complaints were returned by the District
Consumer Forum and were received by the plaintiff
company. The present suit has been filed on
18.5.2023 i.e after One year two months and eleven
days. The total period spent by the plaintiff
company, excluding the period spent before District
Forum, would be One year Seven Months and
Three days + One year two months and eleven
days i.e Two years nine Months and fourteen Days.
The plaintiff company can be given the benefit
under section 14 of the Limitation Act,1963 only
for that period which was spent before the District
Forums.
M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 35 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
65. We can understand it from another angle
also. There are three blocks of the time periods
which are relevant for calculating the period of
limitation.The first block would be from
23.07.2014 to 25.02.2016. This is a period which
was spent by the plaintiff company and no claim
was preferred by the plaintiff company before any
Court, Tribunal or Judicial Authority. The second
block would be the time spent by the plaintiff
company before the District Forum i.e from
25.02.2016 to 7.3.2022. This time has to be
excluded and the third block would be the period
from 8.3.2022 to 18.5.2023. As far as calculating
the period of limitation is concerned, the time spent
in first block and third block would be added which
comes as noted herein above i.e Two years nine
Months and fourteen Days. Thus, the present suit
has been instituted well within the period of
limitation.
66. Moreover, in terms of the proviso attached to
the section 12 A of the Commercial Courts
Act,2015, the time spent in Pre-Litigation
Mediation is to be excluded while calculating the
period of limitation. In the present case, as per the
non starter report, the application before the Pre-
Litigation Mediation was preferred on 11.01.2023
M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 36 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
and the non-starter report was released on
11.04.2023, therefore, around three months were
spent by the plaintiff company before the Pre-
litigation Mediation and that period also has to be
excluded. As noted herein above, the plaintiff
company took Two years nine Months and fourteen
Days for filing the present case. After giving the
benefits of three months u/s 12 A of the
Commercial Court Act, the plaintiff company
finally took Two years six Months and fourteen
days time in filing the present suit i.e Two years
nine Months and fourteen Days (-) Three months.
That being so, on all the counts, the present suit is
within the period of limitation. Accordingly, issue
no.1 is decided in favour of the plaintiff company
and against the defendant company .
Issue No. 3
Whether the suit is bad for non-joinder of necessary
parties, as alleged by the defendant in the written
statement? OPD
67. The next objection taken by the defendant
company is that the present suit is bad for non-
joinder of necessary and proper parties and is liable
to be dismissed. Ld. Counsel for the defendant
company submitted that the shipper or the shipping
agent to whom also the plaintiff company had
raised the claim, was a necessary party and he has
not been made defendant in the present case. He
M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 37 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
submitted that the goods in question were
transported by the shipper and it was the
responsibility of the shipper to make the loss good,
as per the case of the plaintiff company, therefore,
the shipping agent was a necessary party which is
not there, therefore, the suit is liable to be
dismissed.
68. Refuting the allegations of the defendant
company, Ld. Counsel for the plaintiff company
submitted that as per the insurance policy issued by
the defendant company, it was not obligatory for
the plaintiff company to implead the shipping agent
in case of loss covered under the policy. He
submitted that the plaintiff company had lodged a
protest on the shipper therefore, preserving the
rights to subrogation and it cannot be expected
from the plaintiff company to indulge in litigation
with the shipper to claim the indemnity from the
Insurer.
69. Before proceeding further, I may mention
that the general rule in regard to impleadment of
parties is that the plaintiff company in a suit, being
dominus litis, may choose the persons against
whom he wishes to litigate and cannot be
compelled to sue a person against whom he does
not seek any relief. Consequently, a person who is
M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 38 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
not a party has no right to be impleaded against the
wishes of the plaintiff company . But this general
rule is subject to the provisions of Order 1 Rule
10(2) of the Code of Civil Procedure, which
provides for impleadment of proper or necessary
parties. The said sub-rule is extracted below:
“10. (2) Court may strike out or add parties .–
The court may at any stage of the proceedings,
either upon or without the application of either
party, and on such terms as may appear to the
court to be just, order that the name of any
party improperly joined, whether as plaintiff or
defendant, be struck out, and that the name of
any person who ought to have been joined,
whether as plaintiff or defendant, or whose
presence before the court may be necessary in
order to enable the court effectually and
completely to adjudicate upon and settle all the
questions involved in the suit, be added.”
70. The said provision makes it clear that a court
may, at any stage of the proceedings, either upon or
even without any application, and on such terms as
may appear to it to be just, direct that any of the
following persons may be added as a party: (a) any
person who ought to have been joined as plaintiff or
defendant, but not added; or (b) any person whose
presence before the court may be necessary in order
to enable the court to effectively and completely
adjudicate upon and settle the questions involved in
the suit. In short, the court is given the discretion to
add as a party any person who is found to be a
necessary party or proper party.
M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 39 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
71. Here I may refer to the case of Mumbai
International Airport (P) Ltd. v. Regency Convention
Centre & Hotels (P) Ltd., (2010) 7 SCC 417, wherein
it was held that:-
“15. A “necessary party” is a person who
ought to have been joined as a party and in
whose absence no effective decree could be
passed at all by the court. If a “necessary
party” is not impleaded, the suit itself is liable
to be dismissed. A “proper party” is a party
who, though not a necessary party, is a person
whose presence would enable the court to
completely, effectively and adequately
adjudicate upon all matters in dispute in the
suit, though he need not be a person in favour
of or against whom the decree is to be made.
If a person is not found to be a proper or
necessary party, the court has no jurisdiction
to implead him, against the wishes of the
plaintiff. The fact that a person is likely to
secure a right/interest in a suit property, after
the suit is decided against the plaintiff, will
not make such person a necessary party or a
proper party to the suit for specific
performance.”
72. In the present case, it is not in dispute that the
the consignment belonging to the plaintiff company
was insured by the defendant company and for that
separate cover note and insurance policy was
issued. As such it is also not in dispute, rather it has
come on record that there was a loss of quantity of
the goods which were imported by the plaintiff
company. The bone of contention between the
parties is whether that loss, as detailed, is covered
by the insurance policy or not? It is also a matter of
M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 40 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
fact that the plaintiff company is stated to have
lodged the claim before the Shipper also. There is
nothing on record suggesting that it was the pre-
condition to accept the claim of the plaintiff
company by the defendant company to raise the
claim first to the shipper. Further, it is not that the
liability of the shipper and the insurance company
is joint and several.
73. There was a separate contract of insurance
between the plaintiff and the defendant company
and the consideration thereof was the premium to
be paid by the plaintiff company to the defendant
company and defendant company was under
obligation to make the loss good in terms of the
clauses of the insurance policy as agreed between
the parties, in case it comes within the ambit of the
policy. There is no privity of contract between the
shipper and the insurance company as such.
Therefore, in any claim filed by the plaintiff
company against the defendant company, the
shipper would not be a necessary or proper party.
Therefore, issue No. 3 is decided in favour of the
plaintiff company and against the defendant
company.
Issue No.4
Whether the plaintiff is entitled to recovery of
the principal amount, as asked for in plaint?
M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 41 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
(OPP)
74. Before proceeding further, I may note certain
admitted facts. It is not in dispute that the
consignment in question was insured by the
plaintiff company with the defendant company and
for that separate cover note and insurance policy
were issued. Without going into the issue of
whether there was actually short quantity in the
consignment causing loss to the plaintiff company
or not, the moot question which is to be decided by
this court is, whether the said loss is covered under
the insurance policy or not?
75. Ld. Counsel for the defendant company
submitted that no claim is payable qua the alleged
loss of quantity reported by the plaintiff company
as it neither comes within the scope of coverage nor
payable under the terms and conditions of the
Marine Cargo Single Voyage (Sea) Policy and
Institute Cargo Clause (A). He has taken me to the
clauses of said insurance policy and submitted that
as per the exclusion clause 4.2 of the Institute
Cargo Clause (A) there was no insurance cover for
ordinary leakage, ordinary loss, no weight or
volume and ordinary wear and tear subject matter
in short. He submitted that above said clause makes
it crystal clear that the loss in question is excluded
M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 42 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
from the Institute Coverage. He further submitted
that there was no evidence of insured marine peril
activated.
76. Ld. Defence Counsel vehemently argued that
loss of shortage volume and weight was neither due
to any peril nor it was due to unfortunate event
covered under the policy but has occurred only
because of handling operations of the shipment as
well as the transfer of the material from
commencement port to the ship tank and then
transfer of the material from the ship to the
destination shore tank.
77. Per contra, Ld. Counsel for the plaintiff
company vehemently refuted the defense as set up
by the defendant company and submitted that the
policy which was issued to the plaintiff company is
“All Risk Policy” and it covers in its ambit losses
of any kind during the coverage/voyage period. He
submitted that the obligation of the plaintiff
company ends once the loss is reported to the
defendant company and it was the defendant
company to prove that the loss is not covered under
the policy and mere denial on the part of the
defendant company would not be sufficient to reject
the claim of the plaintiff company.
M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 43 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
78. In reply to the contention of the defendant
company regarding the exclusion clause 4.2 of the
Institute Cargo (A), Ld. Counsel for the plaintiff
company submitted that no such document was
ever provided by the defendant company to the
plaintiff company alongwith policy and it is during
the proceedings before the Consumer Courts that
first time the said document was brought to the
notice of the plaintiff company. He further
submitted that the said clause of Institute Cargo
Clause (A) would not be applicable as in the said
clause nowhere it is mentioned that the
losses/damages must take place during the course
of transit/voyage; ‘All Risk Policy’ would cover all
type of losses including the present one which was
caused to the plaintiff company. He further
submitted that the defendant company cannot be
allowed to go beyond the grounds of rejection as
communicated to the plaintiff company vide
communication dated 22.07.2014.
79. Here it is pertinent to refer to the proceedings
dated 06.05.2024. From the proceedings dated
06.05.2024, it is evident that the copy of the
Institute Cargo Clause (A) ExDW2/A was directed
to be taken on record in the present case also
making it clear that Institute Cargo Clause(A)
M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 44 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
ExDW2/A shall be read in evidence at the stage of
final disposal of the cases. Meaning thereby, now,
there is no dispute regarding the admissibility of the
said document Institute Cargo Clause(A)
ExDW2/A and its mode of proof.
80. Before diving deep into the sea of Marine
Insurance, it is imperative to understand the
meaning of “Marine Insurance” and “Perils of Sea”.
Marine insurance is defined under Section 3 of the
Marine Insurance Act, 1963 as an agreement
whereby the insurer undertakes to indemnify the
insured, in the manner and to the extent thereby
agreed, against marine losses, that is to say, the
losses incidental to marine adventure. In simple
terms, marine insurance is a contract which protects
the insured against losses on inland waters or any
land risk that may be incidental to any sea voyage.
The nature of maritime insurance is essentially a
contract of indemnity meaning thereby that the
insurance company is liable only for the actual loss
or damages suffered by the insurer. However, the
insurer cannot be made liable for each and every
loss. Under the Act, the loss to an insurable
property must arise as a consequence of a maritime
peril.
M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 45 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
81. Section 2 (e) of the Act defines ‘maritime
perils’. Broadly speaking, ‘maritime perils’ also
called as perils of the sea include extraordinary
forces of nature which maritime ventures might
need to face during the voyage. It includes those
accidents or casualties which happen during the
voyage by the act of god without any human
intervention. Some of the conditions which cover
the loss by the perils of the sea are clearly laid
down under Sections 55 to 58 of the Marine
Insurance Act, 1963.
82. Perils of the sea is defined in The Hague
Visby Rules12 which under Article 4(2) (c) defines
‘perils’ as ‘perils’ , dangers and accidents of the sea
or other navigable waters, and provides a defence
for the carrier from liability for loss or damage.
83. Under the Marine Insurance Act, 1963, losses
or damages which occur in the ordinary course of
nature or due to own default are not included in the
category of maritime perils. These include: Loss
damage or expense attributed to willful misconduct
of the insured, deliberate damage to/destruction of
the goods, ordinary leakage/ordinary loss in weight
or volume / ordinary wear and tear of the insured
goods, any loss proximately caused by delay,
breakage, inherent vice or nature of the subject-
M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 46 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
matter insured, or for any loss proximately caused
by rats or vermin, or for any injury to machinery
not proximately caused by maritime perils.
84. Further, the doctrine of Proximate cause or
causa proxima is one of the principles of insurance.
In insurance law ‘causa proxima Non Remota
Spectrum’ means the immediate and not the remote
cause is to be considered. For the purpose of
claiming any insurance policy the loss or injury
caused must be as a result of any one of the insured
perils. Peril is basically the cause of loss or the
prime cause of what will give rise to a loss. When
the loss is caused by the perils of the sea the maxim
‘causa proxima ‘is applicable to the case of Marine
Insurance.
85. Thus, once the predominant cause is
determined and it becomes clear that the causa
proxima is covered under the ‘insured peril’, the
insurer is liable to compensate and at that point the
principle of Indemnity will take place. However,
the insurer is not liable if the losses caused by the
insured and the excepted perils cannot be separated
or distinguished and also if it is caused by the
negligent act of the insured .
M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 47 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
86. Before adjudicating the main controversy
between the parties, it would be relevant to weigh
the quality and quantity of the evidence adduced by
the parties. The primary witnesses of both the
parties led their evidence and have deposed by way
of an affidavit. A careful examination of their
affidavit(s) would reveal that the stand taken in the
pleadings has been reiterated in the said affidavit(s)
as an examination- in -chief of the witnesses. As
noted earlier, the witnesses have been cross
examined by the Ld. Counsel of the opposite party
on certain aspects including the facts which are not
in dispute. Thus, I would be referring to that part of
their cross examination which is relevant and is
touching the controversy between the parties and
not otherwise.
87. This takes me to the real issue between the
parties. The consignment of the plaintiff company
was insured vide separate cover note and insurance
policy. When the loss was reported to the defendant
company, surveyor was appointed who has already
given his report. The details of the cover note,
insurance policy and the report of the Surveyor are
as under:
M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 48 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
Sl. No Nature of document Exhibiti. Insurance Cover note 308912 ExPW1/8
ii. Insurance Policy ExPW1/9
272200/21/2012/1020 (colly)
iii. Survey Report dated20.12.2011 ExPW1/12
(colly)
iv. Repudiation letter dated 22.07.2014 ExPW1/16
received by the plaintiff from the
defendant
88. One of the terms and conditions as
mentioned in the insurance cover note ExPW1/8 is
” the insured named above having this day proposed to
affect the above insurance and having paid the premium
stated above the risk is hereby insured, subject to the
usual terms and conditions of the Company’s Standard
Policy’.
89. In the Insurance Policy ExPW1/9 (colly)
under the heading ‘Term of Insurance’, it is stated
as under:
” The risks under this policy are covered as
per the following clauses, current on date of
sailing or dispatch and / or other
conditions/warranties otherwise stated herein
and attached hereto:-
Institute Classification Clause
Institute Cargo Clauses (A)
Institute Tpnd clause
Institute War Clause (Cargo)
Institute Strike Clauses (Cargo)”
90. In the evidence filed by way of affidavit by
the PW1 Ashok Kumar Maharshi, the report of the
M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 49 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
surveyor was given exhibit mark ExPW1/12
(colly).
91. During the arguments by referring to the said
report, Ld. Counsel for the defendant company tried
to make out a case that the loss in question is not
covered by insurance policy. This report has been
filed by the plaintiff company but has not been
disputed by the defendant company also. Meaning
thereby, there is no dispute about this report and
both the parties are placing reliance on these
reports, so the same is being considered.
92. As per the surveyor report of J.B Boda
Surveyors Pvt. Ltd ExPW1/12 (colly), the remarks
are as under:-
” At the port of loading Richardelbay,
quantity as per vessels tanks ullage worked out
to 839.599 M/Tons., this quantity when
compared with the Combined Bill of Lading
Quantity (Kandla/Jebel All) 846.781 M/Tons.,
shows a difference of (-) 7.182 M/Tons.,
(0.848%). (Master of the vessel lodged nots of
protest for the above differences at load port,
photostate copy of the same is attached to this
report).
On arrival at Kandla quantity as per vessel’s
tank’s ullage worked out to 839.215 M/Tons.
On departure from Kandla quantity as per
vessel’s tanks ullage worked out to 404.217
M/Tons. Therefore the quantity discharged as
per ship’s figure at Kandla worked out to
434.968 M/tons., this quantity when compared
with the Kandla Bill of Lading quantity
440.000 M/Tons,, shows a difference of (-)
5.032 M/Tons.(1.144%).
M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 50 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
As per shore tank’s oub-tum, the receipt
quantity worked out to 434.005 M/Tons., this
quantity when compared with Bill of Lading
quantity of 440,000 M/Tons. shows a shortage
of (-)5.995 M/Tons., (1.363%), which could be
partly attributed to the above differences and
partly to unloading loss. “
93. The main cause of dispute between the
parties is the exclusion clause 4.2 of the Institute
Cargo Clause (A) ExDW2/A, which reads as
under:-
” EXCLUSIONS
4. In no case shall this insurance cover
4.1…….
4.2 Ordinary leakage, ordinary loss in
weight or volume, or ordinary wear and tear
of the subject matter insured.”
94. Here it would be relevant to refer to the cross
examination of the witnesses examined by the
parties. During the cross examination, PW1 Ashok
Kumar Maharshi replied (Q.4 & Q.12) that the
nature of loss in the present insurance claim is
Transit Operational Loss. Regarding the nature of
goods imported by the plaintiff company, PW1
replied that it was in liquid form (Q.5). He further
replied that the chemical products went under the
process of loading and unloading two times till
final measurement of volume of chemical (Q.8).
95. Coming to the cross examination of DW1
Renuka Chaudhary, I may mention that even during
M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 51 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
her cross examination plaintiff company failed to
elicit anything contrary to the stand of the
defendant company. DW1 also has deposed about
certain facts which are not in dispute like insurance
policy taken by the plaintiff company was ‘All Risk
Policy’; Insurance Policy is not a named peril
policy; surveyors have not recommended
repudiation of the claim of the plaintiff company or
they did not point out any violation on the part of
the plaintiff company; the definition of ordinary
loss or ordinary leakage has not been provided in
the policy , the term insured peril has also not been
defined etc.
96. DW1 Renuka Chaudhary during her cross
examination on being asked replied that shortage
has occurred during the transfer and nature of the
product. She further replied that in the repudiation
communications, the reason for shortage are
deviation of reference height or discrepancies in
recording the quantity and /or adherence loss or
evaporation loss. She categorically stated that the
defendant company was sure about the exact cause
of loss and that is why the claim was repudiated as
per the surveyor report.
97. In addition to DW1 Reunka Chaudhary,
defendant company has examined S.K
M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 52 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
Chakraborty, Surveyor as DW2 who has also filed
his evidence by way of affidavit ExDW2/A. During
the cross examination of DW2, the nature of
questions put to him was regarding preparation of
the affidavit, qualification of the witness, the
obligation of the surveyor to submit the report
within 30 days, the documents provided to him for
carrying out the survey by the defendant company
and the fact that DW2 had never visited the court
physically etc.
98. If the aforesaid testimonies of these witnesses
are scanned, there would be no difficulty in arriving
at a conclusion that whatever loss was suffered by
the plaintiff company, it was Transit Operational
Loss even as per PW1 Ashok Kumar Maharshi.
PW1 nowhere has stated that the loss occurred due
to marine peril. Thus, whatever the loss was
suffered by the plaintiff company, it was
operational loss during the transit and no marine
peril has taken place for which the defendant
company can be held responsible.
99. Additionally, the insurance cover note
ExPW1/8, as noted herein above clearly indicates
that the risk has been insured subject to usual terms
and conditions of the company’s standard policy.
The terms and conditions have been duly reflected
M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 53 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
in the insurance policy ExPW1/9 (colly) . Under the
heading ‘Term of Insurance’, it has been
categorically mentioned that the risks have been
covered as per certain clauses including Institute
Cargo Clause (A) ExDW2/A. The said clause
clearly says that Insurance Cover shall not cover
the ordinary leakage, ordinary loss in weight or
volume, or ordinary wear and tear of the subject
matter insured.
100. Further, even if it was ‘All Risk Policy’,
there is nothing on record suggesting that said
clause is not applicable. The term “All Risk
Policy”, no doubt, is very wide but it has its own
limitations. It does not mean that all types of losses
and damages are covered under such type of policy.
I am of the opinion that it would not cover things
that are inevitable or almost certain to happen. Even
under ‘All Risk Policy’, it was the duty of the
insured (plaintiff) to prove that the loss suffered by
it was fortuitous. In marine insurance ‘fortuitous
acts’ referred to unexpected and accidental events
that cause loss or damage to the insured. The
examples of ‘fortuitous acts’ are storms or rough
seas, collision of ships, stranding or sinking, fire or
explosion, lightning, earthquake, piracy etc., which
is missing in the present case. Nothing has been
M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 54 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
brought on record by the plaintiff company to show
that the loss to the plaintiff was caused due to any
of the fortuitous acts. Mere wear and tear in
handling the product would not come within the
ambit of ‘ fortuitous acts’. The plaintiff company
was under obligation to connect the loss with any of
the marine peril which the plaintiff company has
miserably failed to do so.
101. It is pertinent to mention that certain types of
products, particularly the chemicals in liquid form,
which are there in the present case, would have a
natural tendency to leakage or loss in weight or
volume during the course of a voyage. Such
ordinary leakage or loss is expected to happen and
the same cannot be treated as fortuitous .The loss
caused to the plaintiff company in the present case
even as per the reports of the surveyors was
basically an unloading/operational loss . Meaning
thereby, the loss in the quantity of consignment was
caused by the natural characteristics of the chemical
being transported without any external influence.
102. Having reached the said conclusion, the
plaintiff company cannot be allowed to say that the
Institute Cargo clause (A) ExDW2/A document
was never supplied to them at the time when the
policy was issued by the defendant company. In the
M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 55 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
cover note it is specifically mentioned that the
insured i.e plaintiff company has agreed to take
insurance policy subject to the usual terms and
conditions of the company’s standard policy. It is
categorically mentioned at page no.2 under the
Terms of Insurance that the Risk under the police
are covered as per the clauses mentioned therein
including Institute Cargo Clause (A) ExDW2/A.
Meaning thereby, the plaintiff company is bound by
all terms and clauses including the Institute Cargo
Clauses (A) ExDW2/A. That clause clearly
excludes the liability of the defendant company
under clause 4.2 which says that in no case shall
this insurance cover ordinary leakage, ordinary loss
in weight or volume, or ordinary wear and tear of
the subject-matter insured.
103. It is true that as per the cover note and the
insurance policies, the consignment was insured
from anywhere in India via any Indian Port (by sea)
but at the same time the insurance policy clearly
states that it agrees to insure the loss/damages or
liability or expenses subject to the clauses,
endorsed, conditions, warranties contained in the
schedule and attached thereto. As per the schedule,
the risk cover was “from anywhere in the world
( load port) to anywhere in India via Indian Port,
M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 56 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
India.” Therefore, the loss as suffered by the
plaintiff company was not covered under the
insurance policy and excluded by the clause of
Institute Cargo Clause (A) ExDW2/A.
104. During the argument, one of the contentions
of the Ld. Counsel for the plaintiff company was
that the defendant company cannot be allowed to
travel beyond the grounds as mentioned in the letter
of repudiation. According to the plaintiff company,
if the defendant company has not taken the plea of
Institute Cargo Clause(A) in the repudiation, in that
eventuality it cannot do so later on for rejecting the
claim of the plaintiff company. In this regard,
reliance was placed on the judgment passed in the
case of Saurashtra Chemicals Ltd. (Supra).
105. In the present case, it is an admitted fact that
the claim of the plaintiff company was repudiated
vide communication dated 22.07.2014 ExPW1/16.
The aforesaid communication is identical, which
read as under:-
” Under the captioned subject matter on close
scrutiny of the papers submitted by insured in
support of this claim vis-a-vis terms and
conditions of the policy issued, the claim is not
tenable on the following grounds:-
A. There was no evidence of any marine peril
activated when the cargo was pumped from
ship’s tank into the shore tank viz. breaking
of tines, overflowing of tanks. abnormalM/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 57 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
leakages etc. in that case, the quantity
brought by the vessel was in fact pumped
and received in shore tank & shortage was
not due to Marine Peril.
B. Secondly, as per surveyor M/s S. K.
Chakraborty & associates report Ref No
SKC/ND/SUR/7535/11-12 DT 24.03.2012
recommendations, it’s a operation loss. hence
claim is not payable.
As such we have no liability under the
policy, which you please note. We
sincerely regret the inconvenience
caused to you and assure you that all
care has been taken to arrive in the
above conclusion, keeping the best
interest of clients and the company in
mind.”
106. The aforesaid repudiation communication is
making it clear that the claim of the plaintiff
company was scrutinized vis-a-vis terms and
conditions of the policy issued in addition to the
report of the surveyor and one of the grounds for
repudiation was operational loss. In the said
communication, it was categorically stated that the
shortage was not due to marine peril hence, there is
no liability under the policy. This is the stand of the
defendant company from the very beginning. The
Institute Cargo Clause (A) ExDW2/A has been
pressed into service by the defendant company to
show that the loss suffered by the plaintiff company
was not caused by any marine peril and ordinary
leakage or loss in weight or volume are excluded
M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 58 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
from the Insurance Cover. It is true that the
repudiation communications is silent in referring to
the Institute Cargo Clause (A)ExDW2/A explicitly
but in pith and substances the claim was repudiated
by the defendant company on the grounds that the
loss was not caused due to any marine peril and
ordinary or operational loss is not covered under
the insurance policy. Therefore, the contention of
the Ld. Counsel for the plaintiff company would
not help him much and no benefit of the said
judgment can be extended to the plaintiff company.
107. I have also gone through the judicial
authorities as relied upon by the Ld. Counsels of
both the parties. There is no doubt about the
proposition of law as laid down in those judgments
with regard to certain issues i.e interpretation of
section 14 of Limitation Act; the burden to prove
exclusion clause lies on the insurer; appreciation of
surveyors reports; in case of doubt of admissibility
of claim, it has to be interpreted in favour of the
insured; the scope of ‘All Risk Policy’ and
exclusion clause as contained in Institute Cargo
Clause (A); the value of second surveyor report
etc. and these principles as laid down, have duly
been considered. However, the same would not
extend any benefit to the plaintiff company as the
M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 59 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
defendant company has been able to prove its case
and has discharged the burden placed on it.
108. In view of my aforesaid discussion, I am of
the considered opinion that the defendant company
has been able to establish that the loss suffered by
the plaintiff company was merely an operational
loss and it was not caused due to any marine peril
during the voyage of the consignment and it might
have occurred due to the handing of the material for
which the defendant company cannot be held liable.
Thus, this Court does not find any fault in
repudiating the claim of the plaintiff company by
the defendant company and consequently the
plaintiff company is not entitled to recover the
amount, as prayed for. Hence, issue no. 4 is
answered accordingly.
Issue no. 5
In case if issue no. 4 is decided in affirmative,
whether the plaintiff is entitled for any interest,
as asked for in the plaint? (OPP).
109. In view of my findings on issue no. 4 , the
question of awarding any interest does not arise.
This issue is also disposed off accordingly.
Issue No.6. Relief
110. In view of my findings on the issues, no. 4,
the present suit of the plaintiff company is hereby
M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 60 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)
dismissed.
111. There is no order as to costs.
112. File be consigned to record room, as per
rules.
Digitally signed
RAJESH by RAJESH
KUMAR GOEL
KUMAR Date:
GOEL 2025.07.30
17:12:28 +0530(Rajesh Kumar Goel)
District Judge (Commercial)-02
Central, Tis Hazari Courts
30.07.2025
Announced in the Open Court
today i.e: 30.07.2025M/s KLJ Plasticizers Limited Date of Judgment 30.07.2025 (Page 61 of 61 )
Vs Oriental Insurance Co. Ltd (829/2023)