The Supreme Court set aside the order of the High Court refusing to interfere in the dispute between the appellant and the respondent as it pertained to disputed questions of fact and were purely in respect of the contractual relationship between the parties. The Bench of Justice RF Nariman and Justice Vineet Saran were hearing the appeal filed before it citing that the respondent had acted arbitrarily in deleting certain provisions of the insurance policy with the intention of reducing its coverage. The insurance policy was in respect of covering the risk of cancellation of cricket matches due to flood, rains etc. Upon the occurrence of one such claim made by the appellant in respect to the match which got cancelled on October 17 2010, the Respondent made an endorsement by unilaterally deleting the expression “floods, rains etc.” After a subsequent claim was made by the Appellant with respect to the cancellation of the match dated October 20 2010, the Respondent refused to accept the claim giving reasons of deletion of the specific terms in relation to the claim placed.
The Bench heard the parties and subsequently set aside the judgment of the High Court with directing the respondent to process the claim of the appellant on the following observations:
“5) Having heard learned counsel for both the sides, we are of the view that the judgment of the High Court needs to be set aside. There is no dispute whatsoever that the action in the present case by the respondent was wholly arbitrary and violated the appellant’s fundamental right under Article 14. No disputed question of fact is raised, and it is settled by several decisions of this Court that even within the contractual sphere, the State, as defined under Article 12 of the Constitution, cannot be arbitrary.”
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