Cases for Rights

8/3/2019 Cases for Rights

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CASE SUPPORTING RIGHT TO REDRESSAL

New India Assurance Company Ltd., Petitioner herein which was

the opposite party before the District Consumer Disputes Redressal

Forum, Bulandshahr (for short, the District Forum) has filed this Revision

Petition against the order dated 11.05.07 passed by the State Consumer

Disputes Redressal Commission, Uttar Pradesh (in short, the State

Commission) in First Appeal No.1103/05 whereby the State Commission

has dismissed the appeal filed by the Petitioner. The District Forum had

allowed the complaint and directed the Petitioner to pay Rs.60,982.27 to

the complainant along with interest @ 8% p.a. from 1.8.93 till

realization. Rs.1,000/- were awarded by way of costs.

Facts:-

Complainant/Respondent filed a complaint before the District

Forum Bulandshahr alleging, inter-alia, that tanker No.UP-13-8970

owned by the Respondent and insured with the Petitioner InsuranceCompany under Carriers Liability Insurance Policy for the period

06.08.91 to 05.08.91 met with an accident on 09.07.92 while it was

carrying 12,000 litres of diesel belonging to the Respondent. In the

said accident, tanker was damaged and except for 212 litres of diesel,

the entire remaining diesel spread on the road and was damaged. Value

of the damaged diesel was Rs.60,982.27 Ps which the insurance

company was liable to pay. That the Insurance Company had wrongly

repudiated the claim of the Respondent. A direction was sought to the

Petitioner to pay the sum of Rs.60,982.27 along with interest @ 24% p.a


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together with sum of Rs.10,000/- as compensation and costs of

litigation.

Petitioner in its written statement contended that the Petitioner

was not liable to reimburse the loss suffered by the Respondent as he

himself was the owner of the diesel which was being carried in the

tanker at the time of accident. That under the Carriers Legal Liability

Insurance Policy, the Petitioner was liable to indemnify the insured

against his legal liability for the actual loss or damage to the goods

being carried belonging to a third party. That the Petitioner was liable to

reimburse the loss or damage to the tanker which was offered and paid

to the Respondent.

District Forum allowed the complaint and directed the Petitioner to

pay a sum of Rs.60,092.27 towards the loss of the diesel as assessed

by the Surveyor along with interest @ 8% p.a. w.e.f 1.8.93 till realization

together with sum of Rs.1,000/- as costs.

Petitioner, being aggrieved, filed an appeal before the State

Commission which has been dismissed by the impugned order.

Counsel for the Petitioner contends that the fora below have

misread and mis-understood the terms, conditions and the coverage

under the Carriers Legal Liability Insurance Policy. That the Petitioner

was not liable to pay the amount of insurance claim in respect of

damage to the goods belonging to the Respondent while being carried

in his vehicle.

Respondent is not present despite notice. Ordered to be

proceeded ex-parte.

Relevant clause of the Carriers Legal Liability Insurance Policy

reads:-


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Company hereby agrees to indemnify the insured

against his legal liability for actual loss of or damages to the

goods ormerchandise directly cause by fire and/or accident to

the vehicle under the No. stated in the schedule whilst such

goods ormerchandise are actually transported in the vehicle

provided that fire or accident has arisen on account of

negligence of the insuredor negligence of actof his servants

and furtherprovided that the vehicle is damaged by such fire or

explosion or and a claim in respect thereof is admitted under

the motor comprehensive insurancepolicy covering it

Further the Exclusion Clause says:-

Provided always that the company shall not in any

circumstances be liable under thePolicy in respectof :-

Liability in respect of damage ofproperty belonging to

insuredor to any servant, agentor sub contractorof the insured

or to thirdparties unless suchproperty is covered by a contract

of carriage entered into by the insured in an approved form

District Forum in its order came to the conclusion that the onus to

prove that the diesel belongs to the Respondent was upon the insurance

company which the Insurance Company had failed to prove. State

Commission upheld this finding. Onus to prove that the diesel was being

transported under a contract of carriage of a consignor other than the

Respondent was upon the Respondent because the said fact was within


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the knowledge of the Respondent only. This fact could not be in the

knowledge of the Petitioner. Respondent had failed to produce the relevant

documents showing that he was carrying the diesel belonging to a third

party and had incurred the legal liability to pay for the loss caused to the

property belonging to a third party. In our considered view, the Fora below

have erred in placing the onus on the Petitioner to prove that the diesel

belonged to the Respondent. The case of the Petitioner throughout was

that the consignment, being transported, was of

the Respondent/Complainant. A perusal of the complaint makes it clear

that the Respondent was carrying his own consignment in the tanker.

Under the Carriers Legal Liability Insurance Policy, the Insurance

Company is liable to indemnify the insured against his legal liability for the

actual loss or damage to the goods being carried belonging to a third party.

Consignment belonging to the insured is not covered under the policy. In

the exclusion clause, it is specifically mentioned that the Insurance

Company was not in any circumstances liable to reimburse for the loss in

respect of damage to the property belonging to the insured or his agent. In

case the insured was interested in taking the insurance cover for the said

consignment, he should have taken theInland Transit Policy and

not Carriers Legal Liability Policy. A perusal of the operative part of

the policy and the exclusion clause would show that the policy would not

cover the risk of the consignment belonging to the insured. Merely

because the consignment was lost/damaged while being carried in the

tanker in question would not entitle the insured to the claim under the

policy when the policy is subject to the Terms and Conditions and the

specific cover granted. A similar view was taken by this Commission in the


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case ofNational Insurance Company Ltd. Vs. Sri Eshwara Sai Oil Mills

III (2010) CPJ 336 (NCC).

The State Commission has erred in holding that the Petitioner was

liable to pay merely because consignment was lost/damaged while being

carried in the vehicle in question. Respondent did not lead any evidence to

show that the consignment belonged to a third party. Onus was on the

Respondent to prove that the consignment in question belonged to a third

party which he failed to do. Fora below have completely misread and mis-

understood the terms, conditions and the coverage under the Carriers

Legal Liability Insurance Policy.

For the reasons stated above, the orders passed by the fora below

cannot be sustained and the same are set aside. Revision Petition is

allowed and the complaint is ordered to be dismissed. Parties are directed

to bear their respective costs.

Time lines for disposal of complaints:-

This provision contained in section 13(3A) has been inserted by the consumer

protection (amendment) Act 2002, w.e.f 1.3.2003. as per this provision, every

complaint shall be heard as expenditiously as possible and within the time as stated

below:

1. Where the complaint dpes not require analysis or testing of commodities, an

endeavour shall be made to decide the complaint within a period of three

months from the date of receipt of notice by the opposite party.


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2. Where the complaint requires analysis or testing of commodities, an endeavour

shall be made to decide the complaint within five months from the date of receipt

of notice by the opposite party.

It is to be noted that where the complaint is disposed ofafter the period of specified

above,the district forum shall record, in writing, the reasons for the same at the time of

disposing the complaint.

Powers of district forum:-

Section 13(4) of the act provides that the district forum shall have the same powers as

are vested in a civil court under the code of civil procedure, 1908, while trying a suit in

respect of following matters, namely:-

1. Summoning and enforcing the attendance of any defendant or witness and

examining the witnesss on oath;

2. Discovery and production of any documeny or other material object producible as

evidence;

3. Reception of evidence on affidavits;

4. Requisition of the report of the concerned analysis or test from the appropriate

laboratory or any other relevant source;

5. Issuing of any commission for the examination of any witness; and

6. Any other matter which may be prescribed.

The CPA of amendment 2002, has inserted a new sub- section 3(B) to secton 13

which has invested the consumer forums with the powers to give an interim relief to the

parties. This section provides that where during the pendency of any proceeding before

the district foum, it appears to it necessary, it may pass such interim order as is just and

proper in the facts and circumstances of the case.


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Relief granted by district forum:-

Sec 14 deals with various directions in the nature of reliefs which may be issue d by the

district forum in favour of the complainant. The analysis of this section shows that the

district forum shall issue dirctions to the opposite party when it is satisfied:

a) That the goods complained against suffer from any defects specified in the

complaint, or

b) That any of the allegations contained in the complaint about the services are

proved.

On being satisfied about the above allegations, the district forum shall issue an orderto

the opposite party directing him to done or more of the following things:

1) To remove the defect pointed out by the appropriate laboratory from goods in

question;

2) To replace the goods with new goods of similar description which shall be free fro

any defect;

3) To return to the complainant the price, or, the case may be, the charges paid by

the complainant;

4) To pay such amount as may be awarded by its compensation to the consumerfor any loss or injury suffered by the consumer due to negligence of the opposite

party;

5) To remove the defect in goods or in services inquestion;

6) To discontinue the unfair trade practice or the restrictive trade practice or not to

repeat them;

7) Not to offer the hazardous goods for sale;

8) To withdraw them from being offered for sale;

9) To pay such sum as determined by the district forum, if it is of the opinion that the

loss or injury has been suffered by a large number of consumers who are not

identifiable conveniently. The minimum amount of sum payable under this clause

shall not be less than 5 % of the value of defective goods sold or services

provided;


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10) To issue corrective ads to neutralize the effect of misleading ads at the cost of

opposite party responsible for issuing such misleading ads;

11) To provide for adequate costs to the parties.

Procedures applicable to state commission:-

Provision of sec 12, 13, and 14, as discussed above , for disposal of complaints by the

district forum , shall ,with necessary modification, be applicable to the disposal of

disputes by the state commission( sec 18).

The power of transfer cases has also been vested in the state commission by the

consumer protection ( amendment) act, 2002. Sec 17 Added by this amendment

provides that the state commission may, on the application of the complainant , or on

its own motion, at any stage of the proceedings, transfer any complaint pending before

the district forum to another district forum within the state if the interest of justice so

requires.

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