ORDER (ORAL)         

MA 42 of 2023 (restoration)       

Mr. Rahul, Advocate proxy is present on behalf of the Respondent and submits on instructions from the client as well as from the counsel on record that the application seeking restoration be allowed.

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In view of the no objection and for the reasons disclosed in the application, the application is allowed and the Appeal is restored to its original number.

The application stands disposed of.

          APPEAL

          The present Appeal has been filed by the Insurance Company against the order dated 25.07.2013 of the State Consumer Disputes Redressal Commission, Madhya Pradesh (for short “the State Commission”) in Complaint No.01 of 2013 filed by them before the State Commission.  Vide the impugned order, the State Commission had allowed the application under Order 7 Rule 11 of CPC and dismissed the Complaint on the ground that the Complainants were not consumer under the Consumer Protection Act.  Aggrieved by the said order, the present Appeal has been filed.

2.      The Appellant has relied on the findings of the constitution bench of the Hon’ble Supreme Court in the matter of “Economic Transport Organization vs. Charan Spinning Mills Private Limited And Another, (2010) 4 SCC 114” and has argued that in view of the letter of subrogation, they were the consumers and therefore, had the locus standi to file the Complaint.

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3.      It is argued on behalf of the Respondent that the services availed were for commercial purpose and therefore, the Appellant is not consumer and the State Commission has rightly dismissed the Complaint relying on the para 25 of the judgment of the Hon’ble Supreme Court in Economic Transport Organization’s case (supra) on which the Appellant itself has relied.

4.      We have heard the arguments and perused the relevant record.

5.      The Appellant No.2 had executed a letter of subrogation in favour of the Appellant No.1.  It is an admitted fact that the Appellant No.1 had dispatched a consignment of refined soya oil weighing 30.075 MT, loaded in Tanker No. MP 09 KD 2228 for safe carriage and delivery with Respondent.  Delivery was to be made from Ex-Dewas, Madhya Pradesh to Palacode, Tamilnadu vide LR No.1557.  Invoice for the said consignment was of ₹19,49,297/-.  This consignment was insured by the Appellant No.1 under the Marine Cargo Policy for the period from 25.07.2011 to 24.07.2012 in favour of the Appellant No.2 who later on subrogated its rights to sue in favour of the Appellant No.1 itself.  According to the Appellant, the tanker met with an accident during the transit on 10.08.2011 at Indore-Khandwa Road.  The Appellant

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No.1 on receiving this information appointed a surveyor who submitted its report on 29.11.2011 and assessed the loss at ₹18,53,378/-.  As per the Appellant No.1, they had settled the claim of Appellant No.2 who had purchased the insurance policy from Appellant No.1 against transport of the consignment through the Appellant for ₹20,61,381.  Subsequently, the Appellant No.1 the Insurance Company filed the claim exercising its right of subrogation for recovery of this amount along with interest @ 12% p.a. w.e.f.21.03.2012 and along with cost of litigation amounting to ₹10,000/-.

6.      The Respondent had taken preliminary issue that since the Appellant No.2 the insurer was not a consumer under the Consumer Protection Act, the Insurance Company could have                        no better rights under the right of subrogation which they had exercised.

7.      The State Commission after hearing the parties and relying the case laws relied upon by the parties held as under:

“5.       The objection raised in the application is that within the frame work of the Consumer Protection Act, 1986 (hereinafter referred to as ‘the Act’), the Complainant No.1-Insurance Co. is not a consumer and even though the party who has subrogated the rights, it cannot prosecute the complaint before the Forum/Commission.  The Counsel for the complainant has invited attention to paragraph-19 of the judgment of the Supreme Court in Economic Transport

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Organization vs. Charan spinning Mills (P) ltd. and another I (2010) CPJ 4 (SC).  Para 19 of the report reads as follows:

“19.        Whether the document executed by the assured in favour of the insurer is a subrogation simpliciter, or a subrogation-cum-assignment is relevant only in a dispute between the assured and the insurer. It may not be relevant for deciding the maintainability of a complaint under the Act. If the complaint is filed by the assured (who is the consumer), or by the assured represented by the insurer as its attorney holder, or by the assured and the insurer jointly as complainants, the complaint will be maintainable, if the presence of insurer is explained as being a subrogee. Whether the amount claimed is the total loss or only the amount for which the claim was settled would make no difference for the maintainability of the complaint, so long as the consumer is the complainant (either personally or represented by its attorney holder) or is a co-complainant along with his subrogee. On the other hand, if the assured (who is the consumer) is not the complainant, and the insurer alone files the complaint in its own name, the complaint will not be maintainable, as the insurer is not a `consumer', nor a person who answers the definition of `complainant' under the Act. The fact that it seeks to recover from the wrongdoer (service provider) only the amount paid to the assured and not any amount in excess of what was paid to the assured will also not make any difference, if the assured - consignor is not the complainant or co-complainant. The complaint will not be maintainable unless the requirements of the Act are fulfilled. The remedy under the Act being summary in nature, once the consumer is the complainant or is a co- complainant, it will not be necessary for the Consumer Forum to probe the exact nature of relationship between the consumer (assured) and the insurer, in a complaint against the service provider.

Learned Counsel for the Opposite Party has also relied upon the same judgment in which paragraph 25 reads as follows:

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25. We may also notice that section 2(d) of Act was amended by Amendment Act 62 of 2002 with effect from 15.3.2003, by adding the words "but does not include a person who avails of such services for any commercial purpose" in the definition of `consumer'. After the said amendment, if the service of the carrier had been availed for any commercial purpose, then the person availing the service will not be a `consumer' and consequently, complaints will not be maintainable in such cases. But the said amendment will not apply to complaints filed before the amendment.

6. The judgment deals with both the situations, pre-amendment by Amendment Act, 1962 of 2002 and post amendment.  In the post amendment, stress has been laid on “but does not include a person who avails of such services for any commercial purpose” in the definition of consumer.  After the said amendment if the service of the carrier has been availed for any commercial purpose then the person availing the service will not be a consumer.

7. It is luculent that the discussion of the case in paragraph-19 is as regards the provision that existed prior to the amendment of 2003 and therefore, remedy on the basis of subrogation does not lie before the Consumer For a but only in Civil Court.  Under these circumstances, there being no doubt that the Premier Industries – Complainant No.2, is also engaged in commercial activities and the oil was sent to a third party in the course of business, the Insurance Co. on the letter of subrogation from such complainant which itself is a commercial organization, cannot found a complaint before this Commission.”

8.      as per admitted facts, the services of the Respondent were availed by the insured for business purposes and therefore the insured does not fall within the meaning of consumer since it has availed/hired the services for commercial purpose.  The Insurance Company, i.e. the Appellant No.2 have no better rights than that of insured.  Same view has been taken by this Commission in Bajaj

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Auto Ltd. & Anr. vs. Conware, 2017 SCC Online NCDRC 927” and “Punjab Conware vs. Global Influence & Anr., 2017 SCC Online NCDRC 983”.

9.      We found no merit in the present Appeal.  There is                                     no perversity or illegality in the impugned order.  The Appeal stands dismissed with no order as to costs.

10.    The Appellant, however, is at liberty to exercise its rights as available under the law and this order will not come in the way of the Appellant to avail of their legal remedy by approaching the appropriate Fora having jurisdiction.