JUSTICE AJIT BHARIHOKE, PRESIDING MEMBER

            Vaan Infra Pvt. Ltd. has filed the instant complaint alleging deficiency in service in respect of insurance claim for the loss of stock and furniture worth Rs.41.00 laks because of accidental fire in the insured premises.  The complainant has sought following reliefs:

“a.        To pay to our client a sum of Rs.41,00,000/- as compensation and damages for their losses along with an interest of 18% from the date of fire incident;

b.         Grant a sum of Rs.10,00,000/- towards exemplary damages detailed above in the complaint for causing the mental agony, tension, harassment and business loss to the complainant;

c.         Grant cost of litigation to the complainant.”

2.         Sections 11 (1), 17 (1) (a) and 21 (i) of the Consumer Protection Act, 1986 ( in short, the Act) deals with the pecuniary jurisdiction of the Consumer Fora to entertain the consumer complaints.  As per Section 11 (1) of the Act, District Forum possesses pecuniary jurisdiction to entertain consumer complaint where value of goods or services as the case may be and the compensation, if any, claimed does not exceed Rs.20 lakhs. As per Section 17 (1) (a) of the Act, the State Commission has pecuniary jurisdiction to entertain consumer complaint where value of goods or services and the compensation, if any, claimed is above Rs.20 lakhs but does not exceed Rs.1.00 crore.  As per Section 21 (a) of the Act, the National Commission has pecuniary jurisdiction to entertain consumer complaint where value of goods or services and the compensation, if any, claimed exceeds Rs.1.00 crore.

3.         In the instant case, the complainant has alleged deficiency in service on the part of the insurance company regarding settlement of his insurance claim to the tune of Rs.41.00 lakhs and he has prayed for compensation to the tune of Rs.41.00 lakhs with interest @ 18% from the date of incident besides Rs.10.00 lakhs as exemplary damage.  The fire incident allegedly took place in the evening of 07.10.2016.  Quantum of the insurance claim i.e. Rs.41.00 lakhs plus 18% interest thereon from the date of fire i.e. 07.10.2016 till the date of filing of complaint on 20.11.2017 plus Rs.10.00 lakh claimed as damages is obviously less than Rs.1.00 crore.  Therefore, question arises as to whether or not, this Commission has pecuniary jurisdiction to entertain the complaint?

4.         Learned counsel for the complainant has drawn my attention to para 14 of the judgment of the larger Bench of this Commission in CC No.97 of 2016 ambrish Kumar Shukla & Ors. Vs. Ferrous Infrastructure Pvt. Ltd. decided on 07.10.2016 which is reproduced as under:

“ It is evident from a bare perusal of Sections 21, 17 and 11 of the Consumer Protection Act that it’s the value of the goods or services and the compensation, if any, claimed which determines the pecuniary jurisdiction of the Consumer Forum.  The Act does not envisage determination of the pecuniary jurisdiction based upon the cost of removing the deficiencies in the goods purchased or the services to be rendered to the consumer.  Therefore, the cost of removing the defects or deficiencies in the goods or the services would have no bearing on the determination of the pecuniary jurisdiction.  If the aggregate of the value of the goods purchased or the services hired or availed of by a consumer, when added to the compensation, if any, claimed in the complaint by him, exceeds Rs. 1.00 crore, it is this Commission alone which would have the pecuniary jurisdiction to entertain the complaint.  For instance if a person purchases a machine for more than Rs.1.00 crore, a manufacturing defect is found in the machine and the cost of removing the said defect is Rs.10.00 lacs, it is the aggregate of the sale consideration paid by the consumer for the machine and compensation, if any, claimed in the complaint which would determine the pecuniary jurisdiction of the Consumer Forum.  Similarly, if  for instance, a house is sold for more than Rs.1.00 crore, certain defects are found in the house, and the cost of removing those defects is Rs.5.00 lacs, the complaint would have to be filed before this Commission, the value of the services itself being more than Rs.1.00 crore. “

5.         It is contended that in view of the aforesaid judgment of the Larger Bench, since the insurance policy purchased by the complainant was Rs.1,70,00,000/-, it has to be taken as value of the services hired or availed by the complainant and as such, the complaint is well within the pecuniary jurisdiction of this Commission.  

6.         The above issue is no more resintegra.  The Coordinate Bench of this Commission in RP No. 1794 of 2017 M/s Maharani of India through Yudhishthira Kapur, Partner Vs. Branch Manager, United India Insurance Co. Ltd. , while dealing with the same issue has observed as under:

“The question which arises for consideration in this petition is as to what would be the value of the service hired or availed by the petitioner/complainant. In CC No.97 of 2016 Ambrish Kumar Shukla & Ors. Vs. Ferrous Infrastructure Pvt. Ltd. dated 7.10.2016,  a three-Members Bench of this Commission observed that if for instance a person purchases a machine  for more than 1 crore  a manufacturing defect is found in the machine and the cost of removing the said defect is Rs.10 lakhs, it is the aggregate of the sale consideration paid by the consumer for the machine and compensation if any claimed in the complaint which  would determine the pecuniary jurisdiction of the consumer forum. It was further observed that if, for instance, a house is sold for more than Rs.1 crore, certain defects are found in the house and the cost of removing those defects is Rs.5 lakhs, the complaint would have to be filed before this Commission, the value of the service itself being more than Rs.1 crore. Thus this Commission took the view that the consideration agreed to be paid by the consumers should be taken as the value of the goods or the services as the case may be and for the  purpose of determining the pecuniary jurisdiction the amount of compensation as claimed in the complaint needs to be added to the agreed consideration.

      When an insurance policy is taken by a person he pays a premium to the insurer for hiring or availing its services. It is the premium paid by the insured to the insurer and not the extent of the sum insured which constitutes the agreed consideration and therefore in my opinion, it is the premium paid to the insurer which when added to the compensation claimed in the complaint would determine the pecuniary jurisdiction of this Commission. The extent of the sum assured would have no bearing on determination of the pecuniary jurisdiction of a consumer forum.”

7.         The aforesaid judgment has been reiterated by the Coordinate Bench of this Commission in First Appeal No. 2028 of 2017M/s Shree Shyam Poultries Vs. The Chief Regional Manager, United India Insurance Co. Ltd. decided on 13.02.2018.

8.         I have carefully gone through the judgment of the Coordinate Bench referred to above and find no reason to take a different view.  Admittedly in the present case, the premium paid by the complainant is Rs.10,763/- and the loss suffered by him is to the tune of Rs.41.00 lakhs.  If we add up the aforesaid amount and also add the exemplary damage of Rs.10.00 lakhs claimed and 18% interest on Rs.41.00 lakhs from the date of fire till the filing of complaint till November 2017, the amount claimed is far below Rs.1.00 crore.  This Commission, therefore, in view of Section 21 (a) of the Act does not have pecuniary jurisdiction to entertain the present complaint and this matter falls within the pecuniary jurisdiction of the State Commission. 

9.         For the reasons stated above, the complaint is rejected for want of pecuniary jurisdiction with liberty to the complainant to file fresh complaint in the State Commission on the same cause of action.