In Brief
A property owner claimed insurance after the municipal corporation demolished part of his building during an encroachment removal drive. The Municipal Corporation is a statutory authority. The State Commission and High Court had allowed the claim, finding the insurer had not proved the exclusion clause applied. The Supreme Court held that once it is established as undisputed fact that demolition was carried out by a lawfully constituted authority (the Municipal Corporation), the exclusion clause in the policy clearly applies. The Court distinguished between whether the municipal action was legally valid (a matter for the separate civil suit) and whether it fell within the policy exclusion. The insurer's appeal was allowed and the insurance claim was dismissed."
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