STATE CONSUMER DISPUTES REDRESSAL COMMISSION,

U.T., CHANDIGARH

(Appeal No.204 of 2010)

                                                                   Date of Institution: 24.05.2010

                                                                   Date of Decision  : 01.12.2010

1.      National Insurance Company Limited, SCO No.813, NAC, Manimajra, U.T., through its Senior Divisional Manager.

2.      National Insurance Company Limited, SCO No.4-5, Sector 9, Madhya Marg, Chandigarh through its Branch Manager.

…Appellants/OPs.

V e r s u s

Sh. Dara Singh son of Sh. Chaman Singh R/o #37/3, Village Butrareala, Sector 41-B, Chandigarh.

              ...Respondent/Complainant.

BEFORE:            HON’BLE MR. JUSTICE PRITAM PAL, PRESIDENT.

                        MRS. NEENA SANDHU, MEMBER

                        S.  JAGROOP  SINGH   MAHAL, MEMBER.

Argued by:            Sh. Navin Kapur, Advocate for the appellants.

                        Sh. Gurpreet Sharma, Advocate for the respondent.

PER  JAGROOP  SINGH  MAHAL,  MEMBER.

1.                     This is OP’s appeal under section 15 of the Consumer Protection Act, 1986 against the order dated 13.4.2010, passed by the learned District Consumer Disputes Redressal Forum-II, U.T., Chandigarh (hereinafter referred to as District Forum), directing the OPs to pay the insured amount of Rs.2,89,750/- along with Rs.50,000/- as compensation for mental agony and harassment and Rs.5,000/- as costs of litigation. If the amount was not paid within 45 days, the amount of Rs.3,39,750/- would be paid with interest @18% per annum from the date of filing of complaint i.e.21.01.2010 till its realization The OPs were proceeded against exparte before the learned District Forum.

2.                     The case of the complainant/respondent is that he had insured his Mahindra Maxx Pickup, Model 2007 with the OPs for Rs.2,89,750/- for the period from 24.10.2007 to 23.10.2008. The vehicle was stolen from his residence on 9.6.2008 regarding which the FIR was lodged with the police. The OPs were also informed. The vehicle could not be traced out. The complainant made several requests and also served a legal notice on the OPs but no payment of the compensation was made to him and ultimately, he filed the present complaint on 21.1.2010.

3.                     A notice was issued to the OPs and was served in their office personally on 29.1.2010. However, nobody appeared on 25.2.2010 and the OPs were, therefore, proceeded against exparte. The complainant produced its evidence in support of his contentions.

4.                     After hearing the arguments of learned counsel for the parties and perusing the record, the learned District Forum allowed the complaint in the terms as mentioned in the opening para of this order. The OPs have filed the present appeal against the said order.

5.                     We have heard the arguments of learned counsel for the parties and have perused the record.

6.                     The learned counsel for the OPs/appellants has argued that they were proceeded against exparte in the case and they had moved an application before the learned District Forum on 7.5.2010 after they received the exparte award dated 13.4.2010 but the said order was not set aside by the learned District Forum due to which they had to file this appeal.

7.                     A perusal of record shows that the OPs were personally served in the case. In their application filed on 7.5.2010, this fact was admitted by them and they further contended that the papers were forwarded by them to their counsel through a courier agency, which misplaced the papers due to which their counsel did not appear on 25.2.2010 and the OPs were proceeded against exparte. The application proves both the facts that the OPs were served and that they did not appear before the learned District Forum on the date fixed by it and therefore, the learned District Forum was justified in proceeding exparte against the OPs.

8.                     Now the next question arises is whether the application dated 7.5.2010 moved under Order 9 Rule 13 read with Section 151 C.P.C for setting aside the exparte order was maintainable or not? Needless to mention that the learned District Forum had no power to set aside its own order. It is beyond our comprehension as to what was the purpose of moving the application before the learned District Forum when the same was not maintainable before it.

9.                     It is also argued by the learned counsel for the OPs/appellants that they have sent a cheque dated 26.2.2010 for Rs.2,88,250/- to the address of the complainant by registered post but the same was not delivered to the complainant and was returned as unclaimed. They have produced the photocopy of the cheque along with letter through which it was sent to the complainant.

10.                   In our view, the sending of the cheque dated 26.2.2010 does not exonerate the OPs of their liability. It may again be mentioned for the sake of repetition that the vehicle was stolen on 9.6.2008 and the claim was lodged with the OPs promptly.  The OPs have not been able to justify as to why there was inordinate delay in finalizing the claim of the complainant. The learned counsel for the complainant/respondent argued that in fact, this cheque has been created subsequently to make a defence in the case, otherwise, it cannot be believed that the letters sent by the OPs would not have reached its destination. Earlier, they claimed to have sent the summons along with the documents to their counsel, which were alleged to have been misplaced and their counsel did not appear before the learned District Forum due to which they were proceeded against exparte. Now they allege that they sent the cheque by registered post but the same was not delivered to the complainant. The OPs very well knew that the complainant has filed a complaint before the learned District Forum, the summons of which they had already received. The cheque was prepared a day after the said case was fixed. It is not understood, why the cheque was sent directly to the complainant instead of sending it to their counsel or sending/presenting the cheque to the District Forum directly where the case was pending. Admittedly on that date, they did not knew if their counsel had not received the papers or had not appeared before the learned District Forum. When the complaint was already pending, it could be withdrawn only after the payment was made before the learned District Forum but the OPs did not chose that procedure for the reasons best known to them. We, therefore, do not have any hesitation to conclude that the OPs have fabricated this story to explain the long delay on their part in finalizing the theft claim of the complainant.

11.                   The learned counsel for the OPs/appellants have argued that the learned District Forum has allowed interest @18% per annum as well as compensation of Rs.50,000/-. He referred to the case of Oriental Insurance Company Limited Vs. B. Ramareddy, II (2006) CPJ 339 (NC), in which, awarding of compensation along with interest was held not justified. In fact, it is not the case here. A perusal of Para No.9 of the impugned order shows that the learned District Forum ordered the payment of insured amount of Rs.2,89,750/- along with Rs.50,000/- as compensation. No interest was awarded by the learned District Forum and therefore, this authority is not applicable in the present case. Even otherwise, there is no bar to allow compensation along with interest. In the case Jagdish Singh Vs. National Insurance Company Ltd., 1994 (1) CPC 468; Karam Industries & Ors. Vs. Oriental Insurance Co. Ltd., IV (2007) CPJ 104 (NC); Oriental Insurance Co. Ltd. Vs. Rajendra Prasad Bansal, II (2008) CPJ 186 (NC)   and Tanawala Synthetic Textile Ltd. Vs. Oriental Insurance Co. Ltd., III (1996) CPJ 99 (NC), the compensation was allowed and maintained by the Hon’ble National Commission even in those cases in which interest was allowed on the amount claimed by the insured. In the present case, if the OPs had paid the amount by a specific date, they were not liable to pay interest but the OPs did not chose that remedy. The payment of interest was conditional only if the amount of compensation was not paid within 45 days of the receipt of the order. The OPs, therefore, chose to pay the interest and could avoid it by paying the amount to the complainant within the aforesaid period. For their own faults, they cannot blame anybody else.

12.                   It is also argued by the learned counsel for the complainant/ respondent that interest @18% per annum is exorbitant and should be reduced. It may again be mentioned for the sake of repetition that interest is to be paid by the OPs/appellants if they did not pay the amount of compensation to the complainant within 45 days of the date of order. There is no illegality in the order because interest @18% per annum had even otherwise been ordered to be paid in the first instance though in the present case, it was only on default. In case Tanawala Synthetic Textiles Ltd. Vs. Oriental Insurance Co. Ltd. (Supra); Jagdish Singh Vs. National Insurance Company Ltd. (Supra) and Oriental Insurance Co. Ltd. Vs. Rajendra Prasad Bansal (Supra), the Hon’ble National Commission directed the Insurance Company to pay interest @18% per annum till the date of payment.

13.                   The learned counsel for the OPs/appellants has argued that they were ready with the money and had even sent the same to the complainant but the cheque was received back undelivered and therefore, it should be ordered that no interest or compensation would be paid by them. We do not find any merit in this contention. It is an admitted case that the OPs/appellants had received the copy of the order and it was only thereafter that they moved an application before the learned District Forum for setting aside the said order. They never tendered the amount before the learned District Forum to avoid the payment of interest. Even thereafter, when they filed the present appeal, they neither tendered the amount before the Commission nor they paid the same to the complainant, nor they deposited it with the learned District Forum.

14.                   As regards the amount of compensation, it is true that the Insurance Company should not suffer for the lapse on the part of its employees. It would be, therefore, in the fitness of things that the OPs/appellants recover the amount of compensation, interest and costs from its official(s) due to whose fault, the finalisation of the claim was delayed and the OPs have to pay this amount, of course by serving a notice on the said official(s) to show cause as to why the amount should not be recovered from him/them.

15.                   In view of the above discussion, we are of the opinion that there is no merit in this appeal and the same is accordingly dismissed with litigation costs assessed at Rs.5,000/-.

16.                   Copies of this order be sent to the parties free of charge.

Pronounced.

1^st December 2010.

Sd/-

[JUSTICE PRITAM PAL]

PRESIDENT

Sd/-

[NEENA SANDHU]

MEMBER

Sd/-

[JAGROOP SINGH MAHAL]

MEMBER

Ad/-

STATE COMMISSION

(Appeal No.204 of 2010)

Argued by:            Sh. Navin Kapur, Advocate for the appellants.

                        Sh. Gurpreet Sharma, Advocate for the respondent.

Dated the 1^st day of December, 2010.

ORDER

                        Vide our detailed order of even date recorded separately, this appeal has been dismissed with costs of Rs.5,000/-.

(JAGROOP SINGH MAHAL)            (JUSTICE PRITAM PAL)     (NEENA SAHDHU)

                MEMBER                                      PRESIDENT                            MEMBER