New India Assurance Co. Ltd. vs Maninderjeet Singh Khera

Prem Narain, Presiding Member

This revision petition has been filed by the petitioner New India Assurance Company Limited challenging the order dated 30th May 2017 passed in first appeal No. 01/ 2017 by the Punjab State Consumer Disputes Redressal Commission, Chandigarh (in short the State Commission).

The brief facts of the case are that the respondent complainant is the owner of the vehicle Chevrolet Optra which was insured from the opposite parties/ petitioner herein for the period from 16.09.2014 to 15.09.2015. The vehicle of the complainant met with an accident on 08.11.2014 and the vehicle was badly damaged. It has been stated by the complainant that notice of the accident was given to the OPs, however, despite several reminders the claim was not finalized. Hence, the complainant filed a consumer complaint before the District Forum. The complaint was resisted by the opposite parties mentioning that the claim of the complainant was not genuine as the vehicle got damaged before taking the insurance and hence, it was requested to dismiss the complaint. The District Forum, however, allowed the complaint and directed the opposite party to pay Rs.3,25,000/- to the complainant for damages to the vehicle as assessed by the surveyor with interest at the rate 9% per annum and Rs.10,000/- as compensation towards harassment as well as Rs.5,000/- towards litigation cost.

Aggrieved by the order of the District Forum, the opposite party preferred an appeal before the State Commission and the State Commission dismissed the appeal with cost of Rs.10,000/- to be deposited with the legal aid account of the Commission as the State Commission found the appeal to be a frivolous appeal against well-reasoned order passed by the District Forum.

Hence, the present revision petition.

Heard the learned counsel for both the parties and perused record. The learned counsel for the petitioner Insurance Company stated that the State Commission has not considered the evidence filed by the petitioner to prove that the vehicle was already damaged before taking the insurance and has relied on the evidence and affidavit submitted by the complainant. It has been further submitted that there was no delay on the part of the petitioner company in processing the claim of the complainant as it was the respondent who himself delayed in providing the requisite documents. Moreover, the State Commission has failed to take into consideration that the terms of the policy nowhere provided for payment of amount as ordered by the District Forum. It was further argued that the respondent has failed to submit explanation as to why the spot survey was not got carried out as it was substantial loss. No independent evidence has been produced by the complainant to prove the alleged accident as such. The State Commission has committed error by relying upon the initial offer of settlement given by the petitioner company. The initial settlement was offered as at that time, no such fraud was in the knowledge of the petitioner company. As the aspect of fraud is involved in the present matter, consumer fora have no jurisdiction to decide such a case and the matter should have been relegated to a civil Court.

On the other hand, the learned counsel for the respondent complainant stated that both the fora below have given concurrent finding of facts and therefore the facts cannot be reassessed by this commission in the revision petition. The District Forum has only allowed the payment of loss assessed by the surveyor who was appointed by the insurance company and who has recommended the claim. It is totally incorrect to allege that the vehicle had met with an accident before the commencement of the insurance policy. Insurance Company is only devising a means to repudiate the claim.

I have carefully considered the arguments advanced by both the learned counsel for the parties and have examined the record. First of all, it is seen that both the fora below have given concurrent finding of facts and have not accepted the assertion of the insurance company that the vehicle met with an accident before the date of commencement of the policy. Facts cannot be reassessed by this Commission in the revision petition as held by the Hon'ble Supreme Court in the case of Mrs Rubi (Chandra) Dutta vs M/s United India Insurance Co. Ltd., 2011 (3) Scale 654 where the Hon'ble Supreme Court has observed the following:

"23. Also, it is to be noted that the revisional powers of the National Commission are derived from Section 21 (b) of the Act, under which the said power can be exercised only if there is some prima facie jurisdictional error appearing in the impugned order, and only then, may the same be set aside. In our considered opinion there was no jurisdictional error or miscarriage of justice, which could have warranted the National Commission to have taken a different view than what was taken by the two Forums. The decision of the National Commission rests not on the basis of some legal principle that was ignored by the Courts below, but on a different (and in our opinion, an erroneous) interpretation of the same set of facts. This is not the manner in which revisional powers should be invoked. In this view of the matter, we are of the considered opinion that the jurisdiction conferred on the National Commission under Section 21 (b) of the Act has been transgressed. It was not a case where such a view could have been taken by setting aside the concurrent findings of two fora."

In the revision petition, the insurance company has mainly agitated the decision of the fora below on facts. The District Forum has only allowed the claim as per the loss assessment and recommendation by the surveyor. Hence, I do not find any merit in the argument of the learned counsel for the petitioner that there is nothing in the policy for allowing the amount as allowed by the District Forum. In fact, the surveyors appointed under the Insurance Act 1938, are independent loss assessors and their report forms the basis for settlement of insurance claims. From this aspect, I do not find any illegality in the order of the District Forum in accepting the report of the surveyor and awarding the claim on that basis. However, when the interest is being awarded on the insurance amount, there is no justification for awarding separate compensation for mental agony and harassment. Thus, the compensation of Rs.10,000/- as awarded by the District Forum is not justified. Similarly, appeal is a legal right given in the Consumer Protection Act 1986, and therefore, the cost of Rs.10,000/- levied by the State Commission for filing the appeal cannot be sustained. Considering the present interest scenario, I am also not convinced about the award of interest at the rate 9% per annum on the insurance amount. Consequently, I deem it appropriate to reduce this interest to 6% per annum which would be reasonable and sufficient considering the fact that there is no agreement between the insured and the insurer in respect of such interest.

Based on the above discussion, the revision petition is disposed of with the direction to the insurance company that the amount of insurance of Rs.3,25,000/- will be paid by the insurance company along with interest @ 6% per annum to the complainant from the date of filing of the complaint. Cost of Rs.10,000/- awarded by the State Commission and compensation of Rs.10,000/- awarded by the District Forum are set aside. Rest of the order of the District Forum is upheld. The insurance company is directed to comply with the order of the District Forum as modified by this order within a period of 45 days from the date of receipt of this older.