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Judgment
The brief facts of the case relevant for deciding the present Miscellaneous Applications are that the Complainant Company which was engaged in Jewellery business, proposed to conduct an Exhibition-cum-Sale in various cities in USA from June 2015 to August 2015. The Complainant Company approached the Opposite Party Insurance Company for obtaining Insurance Cover for protection of the Jewellery Articles during the tour period. Accordingly, the Insurance Company issued “”Package Insurance Policy” to the Complainant on payment of premium of ₹2,49,159/- for a sum of ₹8,74,110/- covering the risk for the period from 27.06.2015 to 15.08.2015. After the closure of the Exhibition event in Dallas on 26.07.2015, the Complainant kept the Jewellery in four suitcases and put the said suitcases in a self-driven Rented Car, locked it and parked the Car before his Cousin's Apartment for taking dinner. The Car was under their watch. It is alleged that the three suitcases out of four were stolen from the said Car by breaking the Car's rear glass. Incident was reported to the local Police at Irving TX, USA and an FIR was registered. The Opposite Party Insurance Company was also informed about the incident and they appointed M/s. Cunningham Lindsey International, Insurance Surveyors and Loss Assessors Pvt. Ltd. to assess the loss. Requisite documents were provided. A Claim was lodged with the Insurance Company for reimbursement for the loss suffered by the Complainant. However, the claim was repudiated by the Insurance Company vide letter dated 30.09.2016 on the ground that the coverage against burglary/theft was excluded from the loss of unattended vehicle/places and as per the special condition of the policy “beyond the hours of client visits, the Jewellery should be kept in a safe of standard type vault and be guarded by armed security person round the clock i.e 24 hours. Aggrieved with the action of the Insurance Company, the Complainant Company filed the Consumer Complaint No. 1094 of 2018 before this Commission. The said Complaint was partly allowed by this Commission vide Order dated 21.09.2021 observing as under:-
“ Applying the Principles laid down by the Hon’ble Supreme Court referred to above, to the facts of the present case, we find that there is no material on Record to establish that the Opposite Party Insurance Company had given the Terms and Conditions of the Special Package Insurance Policy or at any point of time or ever informed the Complainant about the same. Thus, the Exclusion Clause on the basis of which the Opposite Party Insurance Company had repudiated the Insurance Claim of the Complainant, cannot be sustained as the Opposite Party Insurance Company could not rely upon the same. The Repudiation letter is, therefore, set aside. There had been Deficient in Service by the Opposite Party Insurance Company in repudiating the genuine claim of the Complainant and also not providing the Surveyor’s Report within the stipulated time. In view of the foregoing discussions we are of the considered view that the Complainant is entitled to the full Claim of Insurance made for the theft of the Jewellery items. Therefore, the Opposite Party Insurance Company is directed to pay the Claim amount of ₹5,30,80,617/- to the Complainant alongwith interest @12% p.a. from the date of filing of the Claim till the date of payment (Emphasis supplied)
Keeping in view the facts and circumstances of the case, the Complaint is allowed in above terms with Costs of ₹5 lakhs, which the Opposite Party Insurance Company shall pay to the Complainant. The Opposite Party Insurance Company is directed to make the payment within six weeks from today.”
Being aggrieved, the Opposite Party Insurance Company filed Civil Appeal No. 255 of 2022 before the Hon'ble Apex Court. On 28.01.2022, the Hon’ble Supreme Court passed the following order:-
" Heard learned counsel for the parties and perused the material placed on record.
Admit.
Ms. Anubha Agrawal, Learned Counsel accepts notice for the sole Respondent.
Having regard to the circumstances of the case and the findings returned by the National Consumer Disputes Redressal Commission, New Delhi (in short 'NCDRC), we are not inclined to stay the effect and execution of the award made by the NCDRC, barring the amount of costs.
Hence, it is directed that the appellant-insurer shall deposit the awarded amount in the sum of Rs.5,30,80,617 / - (Rupees Five Crore Thirty Lakh Eighty Thousand Six Hundred and Seventeen Only) along with interest @12% per annum from the date of filing of the application till the date of payment, within four weeks from today before the NCDRC. The respondent-claimant shall be entitled to withdraw the amount so deposited by furnishing solvent security, for restitution in case the appeal succeeds."
(Emphasis supplied)
Consequently, the Complainant filed Miscellaneous Application No. 126 of 2022 in Consumer Complaint No. 1094 of 2018 seeking permission of this Commission for release of the amount of ₹5,30,80,617/- along with interest @12% deposited by the Opposite Party Insurance Company in terms of the Order passed by the Hon’ble Apex Court. The said Miscellaneous Application was disposed of vide Order dated 10.05.2022 as under:-
“ The Application is disposed of with a direction to release the amount in terms of the Order dated 28.01.2022 passed by the Hon'ble Supreme Court in Civil Appeal No. 255 of 2022 in the New India Assurance Company Limited and Ors. versus M/s Anjaneya Jewellery. The amount of Rs.5,30,80,617/- along with interest at 12% per annum be released within two weeks.
The MA stands disposed of.”
Thereafter, the Complainant in compliance with the order of the Hon’ble Supreme Court dated 28.01.2022, furnishing the Solvent Security in the shape of Agricultural Land to the satisfaction of the Registry of this Commission for release of amounts deposited by the Insurance Company. Accordingly, an amount of ₹7,73,50,819/- deposited by the Insurance Company on 28.02.2022 vide Diary No. 4984 was released in favour of the Complainant. However, according to the Complainant the amount deposited by the Insurance Company was not in terms of the Order 21.09.2021 passed by this Commission in Consumer Complaint No. 1094 of 2018 and it is short of ₹1,61,41,822/- as per following calculation:-
Sl. No. Particulars Amount
(in Rs.)
Awarded Amount 5,30,80,617.00
Add:
Interest @ 12% p.a. from
23.10.2015 till 25.02.2022 4,04,12,024.00
TOTAL 9,34,92,641.00
Hence, the Complainant filed the present Miscellaneous Application No. 376 of 2022 seeking the following relief:-
a) Allow the present application and direct the respondent to forthwith deposit shortfall amount of Rs. 1,61,41,822, along with interest @18% per annum in compliance of the Order dated 28.01.2022 passed by the Hon'ble Supreme Court in Civil Appeal No. 255 of 2021 and order passed by the Hon'ble Commission dated 21.09.2021 in C.C. No. 1094 of 2018;
b) Allow the applicant to withdraw shortfall amount of Rs.1,61,41,822/- along with interest that shall be deposited by the respondent before this Hon'ble Commission, against the security already furnished;
c) Pass such other or further orders as this Hon’ble Commission may deem fit and proper in the interest of justice.
The Opposite Party Insurance Company in terms of Order dated 28.11.2022 filed its reply to the Miscellaneous Application No. 376 of 2022 stating, inter-alia, that; it had fully complied with the Order dated 28.01.2022 passed by the Hon'ble Supreme Court of India in Civil Appeal No. 255 of 2022 by deposited an amount of ₹7,73,50,819/- with this Commission on 28.02.2022 vide Diary No. 4984 and there was no shortfall of any amount; the Insurance Company had filed a Letter/Objections on 20.05.2022 praying that the Complainant be directed to furnish the Cash Security or Bank Guarantee or Fixed Deposit Receipts as Solvent Security and not the Agriculture Land as per the principle laid down by the Hon’ble Gujarat High Court in the case of State of Gujarat Vs. Mangal Traders, Jamnagar – AIR 1987 Guj 234 and by the Hon’ble Calcutta High Court in Damodar Valley Corporation Vs. Reliance Infrastructure Ltd. – GA No. 7 of 2022 and GA No. 5 of 2022, A.P.No.40 of 2020 decided on 25.03.2022; the Registry has released the deposited amount of ₹7,73,50,819/- to the Complainant on 19.09.2022 without issuing notice on the Letter/Objections filed on 20.05.2022; the release of the amount of ₹7,73,50,819/- by the Registry to the Complainant without furnishing any proper solvent security by the Complainant is incorrect and illegal.
The Complainant has filed its rejoinder in response to the reply filed by the Insurance Company contending that there was a misinterpretation of the Order dated 28.01.2022 passed by the Hon'ble Supreme Court in Civil Appeal No.255 of 2022 regarding the calculation of interest, inasmuch as the Order was categorical and did not stay the effect the execution of the award made by this Commission. It is further submitted that the Insurance Company wrongly calculated the amount of interest from 04.05.2018 i.e. date of filing of Complaint whereas it ought to have been calculated from 23.10.2015, i.e. the date of filing of the Claim Application with the Insurance Company. It is submitted that the Solvent Security could not be in the form of cash as it would defeat the very purpose of furnishing of security against which the amounts have to be released. The Security furnished by the Complainant was Solvent Security and the Registry of this Commission had satisfied itself regarding the extent, factum and solvency of said Security. It is further prayed that the Insurance Company be directed to deposit the shortfall of ₹1,61,41,822.00 along with interest @18% per annum in compliance of the Order dated 28.01.2022 passed by the Hon'ble Supreme Court in Civil Appeal No.255 of 2021.
I have heard the learned Counsel for the parties on the Miscellaneous Application No. 376 of 2020 and also perused the Orders passed by the Hon’ble Supreme Court and this Commission. The main question which falls for consideration in this Miscellaneous Application filed by the Complainant is as to whether the Insurance Company has deposited the amount as directed by the Hon’ble Supreme Court in letter and spirit of its Order dated 28.01.2022 as well as Order dated 21.09.2021 passed by this Commission or there is any short fall in depositing the amount in compliance with the aforesaid Orders.
Vide Order dated 21.09.2021 while disposing of the Consumer Complaint No. 1094 of 2018, this Commission has directed the Opposite Party Insurance Company to pay the claim amount of ₹5,30,80,617.00 to the Complainant along with interest @12% p.a. from the date of filing of the Claim till the date of payment. There is no denial to the fact that the claim application was submitted by the Complainant with the Insurance Company on 23.10.2015 and as such in terms of Order dated 21.09.2021 the Insurance Company was under an obligation to pay interest to the Complainant from the date of submission of claim application. Challenging the Order dated 21.09.2021, the Insurance Company preferred Civil Appeal No. 255 of 2022 before the Hon’ble Supreme Court. The Hon’ble Apex Court while rejecting the prayer for stay of the execution of the Order dated 21.09.2021 passed by this Commission, has directed the Insurance Company to deposit the awarded amount of ₹5,30,80,617.00 with this Commission along with interest @12% p.a. from the date of filing of the application till the date of payment. The liberty was also granted to the Complainant to withdraw the amount to be deposited by the Insurance Company on furnishing Solvent Security for restitution. A bare perusal of the Order dated 28.01.2022 passed by the Apex Court would reveal that the Hon’ble Supreme Court of India has declined to stay the effect and execution of the award made by this Commission barring the amount of costs which means limited stay was granted only to the award of the Costs and the direction given by this Commission to pay the claim amount with interest @12% p.a. from the date of filing of claim attended finality though subject to final outcome of the Appeal. Even otherwise, the Order of the Hon’ble Supreme Court is very clear and the Insurance Company has been directed to calculate the interest on the awarded amount from the date of application i.e. filing of claim application with the Insurance Company and not from the date of filing of Complaint. Hence, I am of the considered view that the Insurance Company is liable to pay the interest from the date of filing of claim application with the Insurance Company which can be calculated as under:-
Sl.
No.
Particulars
Amount
(In Rs.)
1.
Awarded amount of claim dated 23.10.2015
5,30,80,617.00
2.
Interest from 23.10.2015 to 28.02.2022 i.e for 6 years and 4 months (Amount deposited in the Commission on 28.02.2022)
4,03,41,309.96
3.
Total amount to be deposited by the Insurance Company in compliance of the Order dated 28.01.22 passed by the Supreme Court and Order dated 21.09.2021 passed by this Commission
9,34,21,926.96
In compliance of the aforesaid Orders of the Hon’ble Supreme Court and this Commission, the Insurance Company was required to deposit a sum of ₹9,34,21,926.96, however the Insurance Company had deposited only a sum of ₹7,73,50,819/- with this Commission on 28.02.2022 and hence there is a short fall of ₹1,60,71,107.96 (₹9,34,21,926.96 - ₹7,73,50,819,00). Therefore, we direct the Insurance Company to pay a sum of ₹1,60,71,107.96 to the Complainant within a period of two weeks from the date of receipt a copy of this Order.
Miscellaneous Application Nos. 460 of 2022 and 09 of 2023 have been filed by the Insurance Company seeking a direction to the Complainant to return/deposit back the amount of ₹7,73,50,819/- for non-compliance of the order dated 28.01.22 or to furnish Solvent Security in terms of the said Order.
With regard to the objection taken by the Insurance Company that the Solvent Security should be in the form of Cash Security or Bank Guarantee or Fixed Deposit Receipt, I do not find any substance in the said submission. The Hon’ble Supreme Court in the case of Chilukuri Satyanarayan Vs. State of Odisha (Special Leave to Appeal (Cr1) No. 2510/2020 decided on 20.06.2020) has modified its direction to the requirement of Solvent Security in the form of immovable property in place of cash deposit. It was held as under:-
“ On hearing ld. Counsel for the parties, on the offer being made by learned senior counsel for the petitioner, the requirement of cash deposit of Rs.25,00,000/- (Rupees twenty five lakhs) is modified to the requirement of a solvent security of immovable property free from any other proceedings of the requisite value to the satisfaction of the trial court.”
In the present case also, the Agricultural land furnished as Solvent Security by the Complainant for release of the deposited amount is also free from any proceedings and the deposited amount was released to the Complainant by the Registry only on the satisfaction of its title rights on confirmation from the competent authorities.
All the Miscellaneous Applications are disposed of as above.