2025 PLP 1912 (CLD)

ZAFAR IQBAL TARAR, (MEMBER LEGAL).

Petitioners have filed this petition that they are proprietors of M/s Ijaz Brothers General Store and selling the general goods and hosiery etc. They availed the loan facility of Rs. 15-Lacs from HBL, Issa Khel Branch, District Mianwali (respondent No.3). On the requirements of the respondent No.3 for the coverage of the goods, they got insurance policy against the property and stock from respondent No.

1. The description of the property in the cover note was as under:- "On building of house (excluding plinths foundation and pavements) and stock of General Merchandise only, the property of the insured and/or held by them in deposit and/or on commission and/or in joint account with others for which they are legally responsible in the event of loss and/or damage by FIRE BURGULARY RSD AND EARTHQUAKE ONLY, whilst stored and/or lying in shop situated at Issa Khel and building of house khata No.995/968 khatooni No.3598 khasra No.680 owned by Mr. Haq Nawaz Khan son of Umer Khan Mouza Issa Khel Distt: Mianwali and declared for insurance total amounting Rs.41,34,000/-." That the insurance policy was renewed from 18.06.2009 to 17.06.2010 in which the description of the insurance, insured property was as under:- On Hypothecation Stock of General Store Items (Excluding any type of calling cards, "scratch cards, mobile cards) and Shop Building (Excluding Plinths Foundations and Pavements) Bearing Khasra No.680, Khatta No.995/968, Khatooni No. 3598 only the property of the insured held by them in trust and/or in deposit and/or on commission and/or in joint account with others for which they are legally responsible in the event of loss and/or damage by "FIRE on Stock and Building, EARTHQUAKE on Building, RIOT STRIKE DAMAGE AND BURGLARY on Stock" only whilst stored and/or lying in Shop situated at Main Bazar Isa Khel, Distt: Mianwali. That unfortunately, on 19.04.2010, the stock lying at godown caught fire which was reported to the bank as well as local police vide FIR No.63 dated 19.04.2010 and claim No.HOFL-042/2010 for the loss of Rs.850000/-for stock and Rs.95000/- for building of godown was filed with the respondent company, whereupon, they appointed M/s Frank Observers (Pvt.) Ltd., as insurer surveyor, who vide report dated 31.05.2010, recommended loss of Rs.45000/- only arbitrarily, which is totally insufficient and unjustified, whereas, the petitioners were entitled to an amount of Rs.945000/-, but the respondent company refused to pay the claim, whereupon, the petitioners filed this petition.

2. This petition was heartily contested by the respondent company by filing written reply, whereby, they contended that the action of the petitioners was barred by section 69 of the partnership act because the petitioners are claiming as partners; that the firm is un-registered which cannot sue under section 69 of the partnership act; that there is no contract of insurance between the petitioners and respondent company. The insured was HBL, who is not party in the petition; that the petition of the petitioners is not maintainable in the present form; that the alleged incident was allegedly caused due to short circuit whereas, there was load shading at that time; that in the FIR the loss has been alleged to be caused due to malicious act which is not covered in the insurance policy. They also contended that the godown was not covered under the insurance policy. therefore, the petitioners are not entitled to any claim and they prayed for dismissal of the insurance petition.

3. Out of the divergent pleadings of the parties, the following issues were framed by the then learned Insurance Tribunal Lahore on 13.12.2010:-

1. Whether the petitioner is entitled for recovery of Rs 945000/-as insurance claim along with mark up? OPP

2. Whether the petition is barred by section 69 of partnership act? OPR

3. Whether HBL is necessary party? If so, what is effect for non-Impleadment? OPR

4. Whether this petition is incompetent in view of preliminary objections Nos.3 to 7? OPR

5. Relief?

4. The parties were required to produce their evidence in support of their case. Whereupon, the petitioner himself appeared as AW-1 and submitted different documents from Mark-A to Mark-M/1-3. He also produced attested copy of FIR Exh.AW-1/1. Muhammad Shafi Ullah Khan and Muhammad Mumtaz appeared as AW-2 and AW-3 respectively and recorded their statements in support of the version of the petitioner. In rebuttal Islah-ud-Din appeared as RW-1 and produced documents as Exh.R-1 to Exh.R-4.

5. We have evaluated oral as well as documentary evidence on record our findings are as under:-

6. Issue No.1. It is the major issue of the case, its onus was on the petitioners. The petitioners have claimed that they got loan facility of Rs.15-Lacs from HBL, Issa Khel Branch, District Mianwali for their business of general store and on the requirements of the respondent/bank they got insured their properties and stock in the general store from respondent M/s Silver Star Insurance Company Ltd; that unfortunately, on 19.04.2010, their godown building caught fire, whereby, they suffered a loss of Rs.850000/-and Rs.95000/-of building and godown. That they informed the insurance company, who appointed M/s Frank Observers as surveyor, who assessed only a loss of Rs.45000/- vide his report dated 31.05.2010 whereas, they were entitled to the total loss of Rs.945000/-. So far as the respondents are concerned, they contended that they have no contract of insurance with the petitioners; they sold the policy to the HBL who had not filed any petition against them; that this petition is incompetent. In this regard, it is observed that the policy documents exhibit R-2 shows the name of insured as M/s HBL Issa Khel as mortgagees A/C M/s Ijaz Brothers General Store as mortgagors. It is evident that this agreement was tripartite in which the loan of the bank was secured and the stock of general store items and building of shop belonging to the insured under lien were insured. Admittedly, the insurance claim was made by M/s Ijaz Brothers, who was the affected party in the tripartite agreement. Their claim cannot be rejected on this ground that they were not party in the insurance contract. In their petition, the petitioners claimed that on 19.04.2010, the fire occurred in their godown. Learned counsel for the respondent argued that the godown was not insured in the insurance policy neither the stock in it nor its building. Only the shop and stock of the shop were insured, therefore, the petitioners were not entitled to any claim. On the contrary, learned counsel for the petitioners has argued that as per temporary fire cover note dated 07.08.2008 which is on the file as Mark-B building of house and stock of general merchandise was insured. He argued that the godown was also situated in the house, therefore, the respondents are liable to pay the claim. Furthermore, RW-1 in his examination in chief admitted that the stock lying in shop was covered under policy and building of godown was covered, therefore, the respondents are liable to pay the claim. After evaluation of the evidence of the parties, we observe that AW-1 stated on the second page of his examination in chief that godown was also insured as per cover note Mark-C/1-2, whereas, RW-1 stated in fourth line of his examination in chief that stock lying in shop was only covered under policy and building of godown was covered. The copy of the primary cover note dated 07.08.2008 has been produced as Mark-B, in which the insured description is given as under:- On Building of house (excluding plinthe foundation and pavements) and stock of General merchandise only, the property of the insured and/or held by them in deposit and/or on commission and/or in joint account with others for which they are legally responsible in the event of loss and/or damage by FIRE BURGULARY RSD AND EARTH-QUAKE only, whilst stored and/or lying in shop situated at Issa Khel and building of House khata No. 995/968 khatooni No. 3598 khesra No.680 owned by Mr.Haq Nawaz Khan son of Umer Khan Mouza Issa Khel Distt: Mianwali and declared for insurance as under:- Perusal of the above description shows that according to temporary fire cover note, which was only valid for 30 days, the building of house and stock of general merchandise were only insured in it. No separate description of shop or godown was given. After expiry of the cover note, the petitioners got regular insurance policy for the year 2008-2009 and thereafter, they got insurance policy from 30.06.2009 to 30.06.2010 which is on the record as Exh.R-2. The incident of the fire on 19.04.2010 in the godown is not denied but the description of the insured property in the insurance policy is given as under:- On Hypd. Stock of General Store Items and Building of shop only, the property belonging to the insured and under lien to the aforesaid bank, whilst stored and/or lying in the shop, and building bearing khasra No.680, khata No.995/968, khatooni No.3598 both situated on the above noted address and declared for insurance at Rs. 49,14,000/ detail as below. Simple perusal of this description shows that only the building of the shop and the stock lying in it were insured. The godown was not included in the policy nor the stock in it. Under Article 102 of the Qanun-e-Shahadat Order, 1984, the documentary evidence excludes the oral evidence, therefore, when the godown was not insured, in the contract of insurance policy, the claim regarding the same cannot be granted. The report of the surveyor dated 31.05.2010 is on the file as Exh.R-3, in which the surveyor assessed the loss as Rs.45000/-by holding that the building of the godown was also insured, whereas, the stock was not. It is observed that the surveyor incorrectly observed that the godown was insured in the policy, whereas, the contents of the policy documents depict otherwise. His report was not challenged by any party before the SECP so we are not inclined to disturb it. In view of above findings, we hold that the petitioners have failed to discharge the onus of issue No. 1, which is decided against the petitioners.

7. Issue No.2 was that whether the petition is barred by section 69 of the Partnership Act, 1932 its onus was on the respondent. Learned counsel for the respondent has argued that the petitioners have filed this petition as a firm, which is not registered as no certificate of registration has been produced, under section 69 of the Partnership Act this petition is incompetent. On the other hand, learned counsel for the petitioners have argued that petitioners Nos.2 and 3 have also sued in their private capacity as well, therefore, this petition is not barred by the aforesaid provisions of the Partnership Act. After going through the record and hearing the arguments, we are of the view that the petitioners have joined this petition as petitioners Nos.2 and 3 as private persons, therefore, this petition is not hit by the provisions of section 69 of the Partnership Act, 1932. This issue is decided against the respondent.

8. Issue No.3 was that whether HBL is necessary party? If so, what is effect of its non-impleadment, its onus was on the respondent. It is observed that in the amended petition, the petitioners impleaded the bank as party, who was proceeded against ex-parte on 24.06.2014, therefore, this petition cannot be held as bad for non-joinder of necessary parties. This issue is also decided against the respondent. Issue No.4 was that this petition is incompetent and its onus was on the respondent. The respondent has not argued on this specific issue during the course of arguments, so this issue is also decided against the respondent. RELIEF In view of our foregoing reasons and findings on the above issues, this insurance petition is hereby dismissed, leaving the parties to bear their own costs. However, the amount of Rs.45000/- already offered by the respondent company to the petitioners will remain intact File be consigned to the record room. MQ/2/ITL Petition dismissed.