Holding the insurer to the conditions and warranties of the policy, the South Mumbai Consumer Commission Dismisses Rs 5.67 Crore Fire Insurance Claim made by the operator of the 1Above restaurant at Kamala Mills over the December 2017 fire.
Mumbai: A claim of Rs 5,67,25,045 for losses in the fire of December 29, 2017 at the “1Above” restaurant and bar in Kamala Mills, Lower Parel, has failed before the District Consumer Disputes Redressal Commission, South Mumbai, which found that Shriram General Insurance Company Limited was justified in repudiating it. The complaint was brought by Sigrid Ospitalita and Entertainment LLP, which ran the restaurant [M/s. Sigrid Ospitalita and Entertainment LLP v. Shriram General Insurance Company Limited and Another].
The order of September 23, 2026, in Consumer Complaint No. DC/AB1/482/CC/96/2021, was passed by Incharge President Pradip G. Kadu with Members Pratibha R. Patil and Gauri M. Kapse. Member Kapse wrote the judgment, and no costs were awarded.
Three questions, one answer
The Commission asked whether the complainant had proved deficiency in service by the repudiation, whether the repudiation under Condition 18(a) and the warranties was unjustified, and whether the complainant was entitled to the amount claimed. It answered each of them against the complainant.
What was insured and what was claimed
The complainant held a Business Protector Policy from Shriram General Insurance, with fire and special perils cover of Rs 3 crore. The fire broke out at the restaurant premises at about 12.27 am on December 29, 2017. The sum claimed was Rs 5,67,25,045; on the surveyor’s broad heads, it took in material damage of about Rs 3.5 crore and business interruption of about Rs 1 crore. The complainant’s insurance broker, Grovalue Insurance Brokers Pvt. Ltd., was proceeded against ex parte.
Six grounds in the repudiation letter
The insurer’s letter of March 12, 2019 rejected the claim on six grounds. These were a mismatch between the floor described in the policy and the floor of the restaurant; no approval for using the open terrace for food, liquor, hookah and smoking; a temporary monsoon shed of bamboo, tarpaulin and cloth, which the insurer treated as a material alteration that increased the risk and as a breach of the pucca construction warranty; liquor storage and service on the terrace beyond what the liquor licence allowed; hookah use across the terrace beyond a limited smoking-zone permission; and a fixed fire-fighting system that was not operational, in breach of a warranty.
Condition 18(a) of the policy says that cover ceases if the insured causes a “material alteration” or anything “whereby the risk is increased”. All of this was the insurer’s case. The complainant disputed it, arguing that the premises had been inspected before the policy was issued and that it held the required licences and a fire no-objection certificate.
Where the Commission agreed with the insurer, and where it did not
The floor discrepancy, the Commission said, could not by itself carry the repudiation, because the policy itself mentioned the open terrace. The other grounds stood on firmer footing. The surveyor’s report, the fire investigation material and the Government Committee report pointed to a combustible terrace covering and a rapid spread of the fire through it, and the complainant produced no equally cogent independent technical evidence on the shed, the fire-protection system or the use of the terrace.
The complainant’s other answers fared no better. Even if the fire began at the adjoining Mojo’s premises, that did not settle whether the policy conditions had been complied with. An earlier fire no-objection certificate did not show that the fire-protection system was working on the day of the fire, and general licences did not show compliance with the specific conditions and warranties of the policy. An inspection before the policy was issued, absent an express endorsement or waiver, did not reach a later material alteration, and acquittals in related criminal proceedings did not decide contractual liability under the policy.
Because the repudiation letter named the relevant policy provisions and the grounds relied on, the Commission held it to be neither arbitrary nor without reasons. The complaint was dismissed, and copies of the order were directed to be sent to both parties free of cost.
What the order signals
A policy is a contract, and a consumer forum will measure the insured against its conditions and warranties. Applied to a well-known fire loss, the order says that a pre-insurance inspection or a general licence cannot replace an express endorsement or waiver, and that how a fire started does not decide whether the insured kept to the terms on which cover was granted.
An order of a District Commission can be appealed before the State Commission under the Consumer Protection Act, 2019.
Case Title: M/s. Sigrid Ospitalita and Entertainment LLP v. Shriram General Insurance Company Limited and Another [Consumer Complaint No. DC/AB1/482/CC/96/2021]
Bench: Pradip G. Kadu (Incharge President), Pratibha R. Patil and Gauri M. Kapse (Members), District Consumer Disputes Redressal Commission, South Mumbai
Date of Order: September 23, 2026
Appearances: Advocate Kiran Jain and Co. for the complainant; Advocate S. R. Singh and Co. for the insurer