Law:

Section:

NASIR ASLAM ZAHID, J.--Petitioner, is an Insurance Company having its Head Office at Karachi and various branches in the country. Petitioner also has affiliation/arrangement with foreign insurers and reinsurers. According to the petitioner, during the normal course of its business, it issued Fire Insurance Policy favouring the respondent (National Bank of Pakistan) as Mortgagees and M/s. Bela Ghee Mills Limited as Mortgagors in respect of the stock in the factory premises of Bela Ghee Mills Limited situated at SITE Lasbella, Balochistan, in the sum of Rs.26 million.   In April 1991, the petitioner received intimation of loss of the insured stocks due to fire and, on receipt of such information, the petitioner appointed two Surveyors, licensed by the Government under the Insurance Act, to investigate the claim. It is the case of the petitioner that the said Surveyors undertook the survey, visited the site, asked for the details of the documents and other relevant information from the insured and, after completion of the survey, submitted a detailed joint survey report dated 8-9-1991 , according to which, there was no evidence of loss, as claimed, and as such the surveyors did not recommend settlement of the claim, but, without prejudice to the liability of the petitioner, they assessed the loss at Rs.414,830. According to the petitioner, in the light of the said report of Surveyors, petitioner repudiated the claim by their letter dated 9-10-1991. Further, correspondence was exchanged between the parties, but the petitioner maintained that in view of the findings of the Surveyors, they were unable to entertain the claim. According to the petitioner, by letter dated 3-41993, National Bank of Pakistan asked the petitioner-company to settle the said claim within seven days, failing which, it was threatened that the Bank would delist the petitioner from its list of Insurance Companies. The petitioner protested against the said threat-by letter dated 11-4-1993, but, after that there was no response from National Bank of Pakistan. The petitioner, however, were surprised to. read, in a daily newspaper in June 1993, a news item to the effect that National Bank had…