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Issues Involved: Appeal against National Consumer Disputes Redressal Commission's order regarding insurance claim for damaged property.
Insurance Coverage Dispute: The appellant, a factory manufacturing high tension insulators, had an 'All Risk Insurance Policy' for installation of a kiln. After damage occurred during testing, a claim was lodged but the insurance company contended that the damaged property was not covered. The State Commission ruled in favor of the appellant, directing the insurance company to pay the assessed amount. The National Commission considered the exclusion clause regarding second-hand property, but the appellant argued that this clause was not communicated to them. The National Commission held that the insurance company should have ensured the terms were communicated, as good faith is fundamental in insurance law. The Supreme Court agreed, stating that since the exclusion clause was not part of the contract or disclosed to the appellant, the insurance company cannot benefit from it. New Ground in Appeal: The insurance company changed its plea from the damaged property not being covered to alleging violation of policy terms by using used kiln furniture. The National Commission accepted this new ground, which the Supreme Court deemed unsustainable as parties cannot introduce new facts in an appeal. Therefore, the Supreme Court allowed the appeal, setting aside the National Commission's judgment and restoring the State Commission's decision. In conclusion, the Supreme Court found merit in the appeal, ruling in favor of the appellant and directing each party to bear their own costs.
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