January 20, 2022

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Fire accident ‘act of God’ only if caused by natural force: Supreme Court

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Fire accident ‘act of God’ only if caused by natural force: Supreme Court
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Fire accident ‘act of God’ only if caused by natural force: Supreme Court
Fire accident ‘act of God’ only if caused by natural force: Supreme Court

NEW DELHI: The Supreme Court has held that only those fire accidents could be termed acts of God which is inevitable and caused by external natural force and not due to active or passive negligence of human being.
A force majeure clause or act of God is one exception that releases the party of its contractual obligations to an extent when events beyond their control take place and leave them unable to perform their part of the contract.
Adjudicating legal dispute between excise department and McDowell Company over the demand raised against the company towards loss of excise revenue because of destruction of liquor in a fire in warehouse, a bench of Justices A M Khanwilkar, Dinesh Maheshwari and Krishna Murari said, “When nothing of any external natural force had been in operation in violent or sudden manner, the event of the fire in question could be referable to anything but to an act of God in legal parlance”.
The bench set aside the Allahabad HC order which had termed the fire in the warehouse of the company as an act of God and exempted its liability. The court said that the fire in the case was not caused by anything related with the forces of nature like storm, floods, lightning or earthquake and the company cannot be given benefits under the ambit of the act of God.
“It has also not been the case that the fire was a result of any mischief by any person. The fire that started around 12:55pm on April 10, 2003, could be brought under control only by 5am on April 11. When all the relevant factors are cumulatively taken into account, we find it difficult to accept that the fire and the resultant loss had been beyond the control of human agency,” it said.

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