Holding

The term "safe" in the insurance policy refers only to the burglary‑resistant safe specified in the proposal, not to the cashier's cash box, so the loss is not covered.

Summary

The Oriental Insurance Company issued a burglary insurance policy to SAMA Yanallur Primary Agricultural Co‑op Bank covering loss of cash or jewellery kept in a "safe". A burglary resulted in the theft of a cashier's cash box containing cash and pledged jewellery. The District Consumer Forum allowed the bank's claim, but the State Consumer Commission set it aside, holding that the cash box was not a "safe" as defined in the policy. The National Consumer Disputes Redressal Commission partially reversed the State Commission’s interpretation of "safe" and remanded the matter for assessment of loss. On appeal, the Supreme Court held that the term "safe" must be interpreted solely with reference to the insurance proposal and policy, which specified a burglary‑resistant safe, not the cashier's box, and therefore the loss was not covered. The Court set aside the National Commission’s order, restored the State Commission’s decision, and dismissed the bank’s complaint.

Issues considered

Whether the term "safe" in the burglary insurance policy includes a cashier's cash box.
Whether the meaning of "safe" should be determined by reference to dictionaries or limited to the policy and proposal documents.
Whether the loss of cash and jewellery from the cash box falls within the coverage of the policy.

Subjects

insuranceburglary policycontract interpretationdefinition of safeconsumer dispute redressalpolicy coveragedictionaries vs contract terms

Judgment

ORIENTAL INSURANCE CO. LTD. A
v.
SAMA YANALLUR PRIMARY AGRICULTURAL COOP. BANK

NOVEMBER 2, 1999

[S. SAGHIR AHMAD AND R.P. SETHI, JJ.] B

Insurance.

Burglary Policy-Scope of-Cash and jewellery stolen from cash box-
Policy covering loss of only cash or jewellery in safe- 'Safe '-Meaning of- C
Held, insurance policy to be construed having reference only to the
stipulation contained in it-Cash box could not be equated with safe within
the meaning of the policy-Hence, said burglary not covered by the policy.

Respondent-bank took a burglary insurance policy from the appellant
and during the subsistence of the policy, burglary took place in the premises D
of the respondent and cash box containing money and pledged jewellery was
found missing. Claim filed by the respondent was allowed by the District
Forum. In appeal, tM State Consumer Disputes Redressal Commission set ,
aside the order of the District Forum holding that "cashier's cash box" was
not a "safe" within the meaning of the policy which covered "loss of only E
cash or jewellery in safe". Revision preferred by the respondent was partially
allowed by National Consumer Disputed Redr.essal Commission by setting
aside the finding of the State Commission relating to the meaning of word
"safe" and remanded the case to it for determining the actual loss caused to
the respondent. Aggrieved by the order of the National Commission, the
Insurance Company has filed the present appeal. F
The appellant contended that the expression 'safe' was required to be
interpreted by only referring to the insurance policies and other connected
documents and not the dictionaries.

Allowing the appeal, the Court. G
HELD: I. A combined reading of the proposal of insurance and the
insurance policy clearly indicate that the gold jewellery and the cash were
insured in safe and locked safe which was specified by the insurP.d 111 lh<>:
proposal itself. Admittedly, the aforesaid safe· was actually not in existc!\1·e
H
329
I-

330 SUPREME COURT REPORTS (1999) SUPP. 4 S.C.R.

A and burglary not committed from the "safe" for which the insurance policy
was issued. [331-G)

2. There was no necessity of referring to the dictionaries for
understanding the meaning of the word "safe" which the parties in the instant
case are proved to have understood while submitting the proposal and accepting
B the insurance policy. The cashier's box could not be equated with the safe
within the meaning of the insurance policy. The alleged burglary and the
removal of the cash box containing the jewellery and cash was not covered by
the insurance policy between the parties. The insurance policy has to be
construed having reference only to the stipulations contained in it and no

c artificial far-fetched meaning could be given to the words appearing in it.
[332-D-E)

CIVIL APPELLATE JURISDICTION: Civil Appeal No. 8716 of
1997.

From the Judgment and Order dated 1.5.97 of the National Consumer
D
Disputes Redressal Commission, New Delhi in R.P. No. 343of1996.

NaZIUi Waziri and Irshad Ahmad for the Appellant.
I
K.B. Sounder Rajan for the Respondent.

E The Judgment of the Court was delivered by

SETHI, J. The Respondent-Bank had taken two insurance policies
with the appellant-company out of which one was a cash insurance policy
for Rs. I lakh and the second was a burglary insurance policy for Rs. 25
lakhs. The period covered by the latter Insurance Policy was from 6. l l .1992
F to 5.11.1993. On the night of 27 January, 1993 an incident of burglary took
place in the premises of the insured bank and the cash chest was found •
missing for which a complaint was lodged with the police and claim made
with the appellant company for the value of pledge jewellery which was
alleged to have been lost together with a cash of Rs. 9,279.25. The District
Consumer Redressal Forum, Madurai (hereinafter referred to as the "District
G
Forum)" where the complaint was filed allowed the claim of the respondent-
bank and awarded compensation to it as prayed for in the claim-petition. In
appeal, the State Consumer Disputes Redressal Commission, Madras (hereinafter
c
referred to as the "State Commission") set aside the award of the District
Forum holding that "cashier's cash box" in which the jewellery and cash was
H alleged to be kept was not a "safe" within the meaning of policy which
ORIENTAL INSURANCE CO. LTD. v. S.P. AGRICULTURAL CO-OP. BANK [SETHI, J.] 33 J

covered "loss of only cashor jewellery in safe". The revision preferred by A
the respondent-bank was :partially accepted by the National Consumer
Disputes Redressal Commission, New Delhi (hereinafter referred to as the
"National Commission") by setting aside the finding in so far as it related to
the meaning of word "safe" as interpreted by the State Commission and the
case remanded to the State Commission for the purposes of investigating into B
the matter for determining the question of quantum of loss actually caused
to the respondent-bank. Not satisfied with the order of the National
Commission, the Appellant Company has preferred this appeal.

Learned counsel appearing for the appellant-company has contended
that the National Commission was not justified in seeking the aid of C
dictionaries to interpret the meaning of the expression "safe". It is contended
by him that the expression "safe" in the instant case was required to be
interpreted by having reference to the insurance policies and the other
connected documents. We find substance in his submission.

The insurance policy relating to house breaking or burglary shows that D
the gold and jewels were pledged 'in "safe". Cash and notes secured which
were insured were such cash and notes which were locked in "safe". The
proposal for insurance of the contents of business premise~ against house
breaking and burglary, as submitted by the respondent~bank, contained
various information required and actually st:bmitted .by the insured. Columns E
3(a) and (b) of the said proposal read as :

"3(a) Are all valuables secured in Burglary resisting safes when
Premises are locked Yes
~ ~... . . ... .
(b) If so, state name or maker of ·safe and cost Tansi
F
Against the entry 3(a) the insured had stated "yes" and against entry 3(b)
the make of safe was specified. A combined reading· of the proposal of
insurance and the insurance policy clearly indicate that the gold jewellery and
the cash were insured in safe and locked safe which was specified by the
insured in the proposal itself. Admittedly, the aforesaid safe was actually not G
in existence and burglary not committed from the "safe" for which the insurance
policy was issued. According to the complainant the burglary had been
committed from the "cashier's cash box". The surveyor, namely, Shri Sreedharas
in his survey report dated 27 January, 1993 submitted that the stolen jewels
had not been kept in safe locker and the theft was not covered under burglary
insurance policy. The District Forum without properly appreciating the H
332 SUPREME COURT REPORTS [1999) SUPP. 4 S.C.R.

A insurance policy and the accompanying proposal directed the appellant-
company to pay a total sum of Rs. 43,729.25. The State Commission referred
to the burglary policy produced before it as Exhibit A-3 and cash insurance
policy Exhibit A-4. After referring to the relevant documents the State
Commission concluded that Exhibit A-3 covered "pledged gold jewellery i11-
safe" and the insurance proposal Exhibit B-7 had clearly mentioned that:ii!I
B the valuables were secured in burglary resistance safe made by Tansi. The
cash box was held to be a smaller container kept by the cashier near the cash
counter which was easily removable. The State Commission further held :

"What is insured is not the contents of the cash box but the jewels

c kept in the safe which means safety locker made by Tansi as agreed
to in the proposal form in Exb. B-7. It is clear therefore that the jewels
kept in the cashier's cash box is not covered by Exh. A-3 policy."

The State Commission appreciated the real controversy between the parties
and decided the dispute on interpretation of the insurance policies and the
D proposal produced before the District Forum. There was no necessity of
referring to the dictionaries for understanding the meaning of the word "safe"
which the parties in the instant case are proved to have understood while
submitting the proposal and accepting the insurance policy. The cashier's box
could not be equated with the safe within the meaning of the insurance policy.
The alleged burglary and the removal of the case box containing the jewellery
E and cash was not covered by the insurance policy between the parties. The
insurance policy has to be construed having reference only to the stipulations
contained in it and no artificial farfetched meaning could be given to the
words appearing in it. The National Commission was, therefore, not justified
in setting aside the order of the State Commission 11nd remanding the case
F back to it for the purposes of ascertaining the extent of actual loss caused
to the respondent. The order of the State Commission did not suffer from any
illegality or error of jurisdiction requiring interference by the National
Commission.

Under the circumstances this appeal is allowed by setting aside the
G order of the National Commission and restoring the order of the State
Commission. The complaint filed by the respondent bank shall be deemed to
have been dismissed. No costs.

A.K.T. Appeal allowed .