Order by:

Sh.Amrinder Singh Sidhu, President

1.       The complainant  has filed the instant complaint under section 35 of the Consumer Protection Act, 2019  on the allegations that he was owner of vehicle i.e. Mercedes, Benz, bearing Registration  No.PB29-W-0003, Chassis No.WDC1660036M013127, Engine No.65196033639-106 and the said vehicle was insured with Opposite Parties for the period w.e.f. 11.11.2018 to 10.11.2019 bearing policy No. 361100311803-000004322  (Nil DEP Policy) for IDV of Rs.43,75,000/-. Further contended that unfortunately, during the policy period, the aforesaid vehicle of the Complainant met with an accident on 24.02.2019 at Moga. In this regard, the Complainant immediately informed the Opposite Parties and they deputed M/s.Sandeep Sharma & Associates,  and the vehicle was brought to Joshi Auto Zone Private Limited Ludhiana  who assessed the total loss to the tune of Rs.51 lacs for its repair which was also confirmed by the surveyor. But due to the oldage of Sh.O.P.Sharma, of  M/s.Sandeep Sharma & Associates, he could not complete the investigation or enquiry ad ultimately, said surveyor died.  Thereafter, the Opposite Parties appointed another surveyor namely Mr.Yashwinder Goyal on 01.10.2019 who submitted the interim report on 25.11.2019 who assessed the loss to the vehicle to the tune of Rs.43,75,000/- which is the IDV of the vehicle in question and during the investigation on 5.12.2019, they lifted the accidental vehicle and received demand draft of Rs.24 lakhs  and the balance amount of Rs.19,75,000/- was paid by the Opposite Parties on 14.02.2020 after the gap of one year.  In this way, as admitted, the accident was caused to the vehicle on 25.02.2019 and the intimation and claim was immediately lodged on 25.02.2019 with the Opposite Parties and the Opposite Parties firstly paid the amount of Rs.24 lakhs on 05.12.2019 and remaining amount of Rs.19,75,000/- paid on 14.02.2020. In this way, the Opposite Parties has delayed the claim of the Complainant intentionally and knowingly without any reasonable cause and due to the late settlement of the claim of the vehicle, the Complainant has suffered a lot as he could not purchase new vehicle for more than one year and due to this reason,  he suffered loss in his business as well as personal loss due to non availability of the vehicle and also remained under mental tension and harassment.  Whereas, as per the regulations/ instructions issued by IRDA, the claims made under the Insurance Policies are ordinarily  to be settled within one month of the submission of the claim. Hence, the aforesaid act of the opposite parties of non settlement of his genuine claim in time,  is illegal, unwarranted and uncalled for.  Though the loss suffered by the complainant can not be compensated in the shape of money, but still the complainant is entitled to compensation for mental tension and harassment amounting to Rs.10,00,000/-. The detail of the claim as under:-

The repeated requests have been made to the Opposite Parties to make good the loss caused by the Complainant due to late settlement of his claim, but the Opposite Parties did not pay any heed to the request of the Complainant. In this way, said conduct of the Opposite Parties clearly amounts to deficiency in service and as such, the Complainant is left with no other alternative but to file the present complaint.  Vide instant complaint, the complainant has sought the following reliefs.

1. a)  The Opposite Parties may be directed to make good the loss to the tune of Rs. 4,10,666/- alongwith future interest @ 12% per annum from its respective due date till its realization
2. The amount of Rs.10,00,000/- be allowed to be paid by the opposite parties on account of compensation due to mental tension and harassment caused by the complainant.
3. The cost of complaint amounting to Rs.20,000/- may please be allowed.

2.       Opposite Parties  appeared through counsel and contested the complaint by filing  the written version  on the ground inter alia that the complaint is not maintainable; that there is no deficiency in service on the part of the Opposite Parties and that the complaint is absolutely false and frivolous.  The complainant has already accepted the claim amounts voluntarily without any objection, protest and rejoinder etc, which were paid strictly in accordance with terms and conditions of the insurance policy in question and  after obtaining the consent from the complainant and as per the assessment of loss made vide report of independent surveyors and have been paid by the Opposite Parties without any coercion, undue influence and misrepresentation. The complainant never subjected to any compulsions to accept the claim assessed under the insurance policy. Moreover, the claim was immediately entertained, inquired and investigated and after due application of mind, the same has already bee paid to the complainant without any delay whatsoever. Further alleges that as per the chain of the events happened in this case, the complainant had first informed the Opposite Parties  about loss to his vehicle on 27.02.2019 and the same was to be entertained by the committee of three high officials of the Opposite Parties being heavy claim amount and immediately, it was informed to the Head Office of the Opposite Party for the deputation of an independent surveyor. Accordingly, Mr.Sandeep Sharma and Associates was appointed as surveyor by the Head Office on 06.03.2019 who submitted his interim report on 14.03.2019. the final surveyor report was awaited, but in the month of October, 2019 it came to the notice of Opposite Parties that said surveyor had died in the month of April, 2019 and thereafter Mr.Yashwinder Goyal was appointed by the Opposite Parties to investigate the mater who assessed the loss on 01.10.2019 and said new surveyor Yashwinder Goyal submitted his interim surveyor reports on 25.11.2019 and 01.12.2019. On the basis of said reports special claim note was immediately prepared and claim of Rs.24 lakhs was approved on 3.12.2019 and  paid to the complainant directly on 05.12.2019 as per  wreck value of the vehicle. Further another special claim note was prepared and approved on 07.01.2020 for remaining amount which was paid on 14.02.2020 and both the claims were received by the complainant without any protest and objections whatsoever as above said and hence, there was no inordinate delay in processing and payment of the claim on the part of the Opposite Parties. It is further submitted that unfortunate death of first surveyor was not reported to the Opposite Parties and had  this fact came to the knowledge of the Opposite Parties, it would have been processed earlier as it has been processed on day to day basis afterwards.  On merits, the Opposite Party took up almost the same and similar pleas as taken up by them in the preliminary objections.Remaining facts mentioned in the complaint are also denied and a prayer for dismissal of the complaint was made.

3.       In order to  prove  his  case, the complainant has tendered into evidence his affidavit Ex.C1  alongwith copies of documents Ex.C2 to Ex.C15 and closed his evidence.

4.       On the other hand,  to rebut the evidence of the complainant,  Opposite Parties tendered into evidence affidavit of Ms.Sunita Mahajan, Ex.Ops1,2/1 alongwith copies of documents Ex.Ops1,2/2 to Ex.OP1,2/14 closed the evidence on behalf of the Opposite Parties.

5.       We have heard the ld.counsel for the parties and  gone through the documents placed  on record.

6.       During the course of arguments, ld.counsel for the Complainant has  mainly reiterated the facts as narrated in the complaint and  contended that  the written version  filed on behalf of Opposite Party  has not been filed by an authorized person. Therefore, the written version so filed is not maintainable. Opposite Party  is limited Company and written version has been filed on the basis of special power of attorney given  to ld.counsel for the Opposite Party.  Further contended that during the policy period, the aforesaid vehicle of the Complainant met with an accident on 24.02.2019 at Moga. In this regard, the Complainant immediately informed the Opposite Parties and they deputed M/s.Sandeep Sharma & Associates,  and the vehicle was brought to Joshi Auto Zone Private Limited Ludhiana  who assessed the total loss to the tune of Rs.51 lacs for its repair which was also confirmed by the surveyor. But due to the oldage of Sh.O.P.Sharma, of  M/s.Sandeep Sharma & Associates, he could not complete the investigation or enquiry ad ultimately, said surveyor died.  Thereafter, the Opposite Parties appointed another surveyor namely Mr.Yashwinder Goyal on 01.10.2019 who submitted the interim report on 25.11.2019 who assessed the loss to the vehicle to the tune of Rs.43,75,000/- which is the IDV of the vehicle in question and during the investigation on 5.12.2019, they lifted the accidental vehicle and received demand draft of Rs.24 lakhs  and the balance amount of Rs.19,75,000/- was paid by the Opposite Parties on 14.02.2020 after the gap of one year.  In this way, as admitted, the accident was caused to the vehicle on 25.02.2019 and the intimation and claim was immediately lodged on 25.02.2019 with the Opposite Parties and the Opposite Parties firstly paid the amount of Rs.24 lakhs on 05.12.2019 and remaining amount of Rs.19,75,000/- paid on 14.02.2020. In this way, the Opposite Parties has delayed the claim of the Complainant intentionally and knowingly without any reasonable cause and due to the late settlement of the claim of the vehicle, the Complainant has suffered a lot as he could not purchase new vehicle for more than one year and due to this reason,  he suffered loss in his business as well as personal loss due to non availability of the vehicle and also remained under mental tension and harassment.  Whereas, as per the regulations/ instructions issued by IRDA, the claims made under the Insurance Policies are ordinarily  to be settled within one month of the submission of the claim. Hence, the aforesaid act of the opposite parties of non settlement of his genuine claim in time,  is illegal, unwarranted and uncalled for.  It is further contended that the complainant never gave any consent for receiving the payment as full and final settlement whereas the amount has been paid very late directly in the account of the complainant without his consent and in this regard, the complainant on so many times, made requests to the Opposite Parties for settlement of his claim immediately as he is suffering loss due to non payment of claim amount, but the Opposite Parties did not pay any heed to the request of the complainant.  

7.       On the other hand, ld.counsel for the Opposite Party  has repelled the aforesaid contention of the ld.counsel for the complainant  on the ground that  the complainant has already accepted the claim amounts voluntarily without any objection, protest and rejoinder etc, which were paid strictly in accordance with terms and conditions of the insurance policy in question and  after obtaining the consent from the complainant and as per the assessment of loss made vide report of independent surveyors and have been paid by the Opposite Parties without any coercion, undue influence and misrepresentation. The complainant never subjected to any compulsions to accept the claim assessed under the insurance policy. Moreover, the claim was immediately entertained, inquired and investigated and after due application of mind, the same has already been paid to the complainant without any delay whatsoever. Further alleges that as per the chain of the events happened in this case, the complainant had first informed the Opposite Parties  about loss to his vehicle on 27.02.2019 and the same was to be entertained by the committee of three high officials of the Opposite Parties being heavy claim amount and immediately, it was informed to the Head Office of the Opposite Party for the deputation of an independent surveyor. Accordingly, Mr.Sandeep Sharma and Associates was appointed as surveyor by the Head Office on 06.03.2019 who submitted his interim report on 14.03.2019. the final surveyor report was awaited, but in the month of October, 2019 it came to the notice of Opposite Parties that said surveyor had died in the month of April, 2019 and thereafter Mr.Yashwinder Goyal was appointed by the Opposite Parties to investigate the mater who assessed the loss on 01.10.2019 and said new surveyor Yashwinder Goyal submitted his interim surveyor reports on 25.11.2019 and 01.12.2019. On the basis of said reports special claim note was immediately prepared and claim of Rs.24 lakhs was approved on 3.12.2019 and  paid to the complainant directly on 05.12.2019 as per  wreck value of the vehicle. Further another special claim note was prepared and approved on 07.01.2020 for remaining amount which was paid on 14.02.2020 and both the claims were received by the complainant without any protest and objections whatsoever as above said and hence, there was no inordinate delay in processing and payment of the claim on the part of the Opposite Parties. It is further submitted that unfortunate death of first surveyor was not reported to the Opposite Parties and had  this fact came to the knowledge of the Opposite Parties, it would have been processed earlier as it has been processed on day to day basis afterwards.

8.       Perusal of the contention of the ld.counsel for the complainant   shows  that  the written version  filed on behalf of Opposite Party has not been filed by an authorized person. Therefore, the written version so filed is not maintainable. The Opposite Party  is limited Company and written version has been filed on the basis of special power of attorney given  to ld.counsel for the Opposite Party.  In this regard, Hon’ble Supreme Court of India in case titled as Shubh  Shanti  Services  Limited  v.  Manjula S.Agarwalla and others (2005) 5 SCC 30, decided on 11.05.2005 has  and observed to the following effect:

 “..............As already stated, it has not been  averred in the plaint nor sought to be proved that  any resolution had been passed by the Board of  Directors  of  the  plaintiff  company  authorising  Shri A.K. Shukla to sign, verify and institute the  suit.   It  has  also  not  been  averred  that  the  memorandum/articles of the plaintiff company give ny right to Shri A.K. Shukla to sign, verify and  institute  a  suit  on  behalf  of  the  plaintiff  company.  It, therefore, follows that the plaint  has been instituted by Shri A.K. Shukla only on  the  authority  of  Sh.  Raj  K.Shukla,  CEO  of  the  plaintiff  company.   Such  an  authority  is  not  recognized under law and, therefore, I held that  the  plaint  has  not  been  instituted  by  an  authorised  person.   Issue  No.1  is  accordingly,  decided against the plaintiff and in favour of the  defendants.”

Further,  Hon’ble Supreme Court of India in a judgment (2011)II Supreme Court Cases 524 titled as “State Bank of Travancore Vs. Kingston Computers India Pvt. Ltd.” and in para no.11 of the judgment,  has held that

“the plaint was not instituted by an authorized person. On the plea that one authority letter dated 02.01.2003 was issued by Sh. R.K.Shukla in favour of Sh. A.K.Shukla. Further plaint failed to place on record its memorandum/articles to show that Sh. R.k.Shukla has been vested with the powers or had been given a general power of attorney on behalf of the Company to sign, verify and institute the suit on behalf of the Company.”

Recently Hon’ble State Consumer Disputes Redressal Commission, Punjab at  Chandigarh in FAO No.1235 of 2015 decided on 25.01.2017 in case titled as L.G.Electronics India Private Limited Vs. Sita Ram Chaudhary also held that the plaint instituted by  an unauthorized person has no legal effect.

9.       For the sake of arguments, for the time being, if the written reply filed by Opposite Party is presumed to be correct, the next  plea  raised by Opposite Party  is that the complainant has complainant has already accepted the claim amounts voluntarily without any objection, protest and rejoinder etc, which were paid strictly in accordance with terms and conditions of the insurance policy in question and  after obtaining the consent from the complainant and as per the assessment of loss made vide report of independent surveyors and have been paid by the Opposite Parties without any coercion, undue influence and misrepresentation. On the other hand, ld.counsel for the complainant has vehemently repelled the aforesaid contention of the Opposite Parties and contended that he   has nowhere signed any discharge voucher for the receipt of part payment which the Opposite Parties have arbitrarily made directly in his account.. In this regard, the Opposite Parties has failed to produce on record any iota of evidence to  prove that the complainant has received said insured amount as full and final settlement and as such, we do not agree with the aforesaid contention of the Opposite Parties. Hon’ble National Consumer Disputes Redrssal Commission, New Delhi in case  Prabha Tyagi vs National Insurance Co. Ltd. REVISION PETITION NO. 568 OF 2017 (Against the Order dated 07/12/2016 in Appeal No. 215/2013 of the State Commission Uttaranchal) Decided on  on 18 September, 2018 has clearly held that even if the discharge voucher is signed by the policy holder even, still the  execution of such vouchers does not foreclose the rights of policy holder to seek higher compensation before any judicial fora or any other fora established by law. The relevant portion of the judgement is reproduced as under:-

“The learned counsel further argued that execution of discharge voucher for settlement of earlier claim of Rs.1,00,000/- does not debar the complainant to pursue his remaining claim of Rs.1,00,000/- in a court of law like the consumer forum.  In this regard, the learned counsel relied upon the following pronouncements:-

(1)     Ramdas Sales Corporation Vs. New India Assurance Company Ltd., III (2016) CPJ 40 (NC).  It has been held that:-

"3.  The learned counsel for the complainant has placed before us a Circular No.IRDA/ NL/CIR/Misc/ 173/09/2015 dated 24.09.2015 issued by Insurance Regulatory Development Authority of India (IRDA) to all the General Insurance Companies, with regard to the use of discharge vouchers in settlement of claim.  The said circular reads as under:-

"The Insurance Companies are using 'discharge voucher' or "settlement intimation voucher" or in some other name, so that the claim is closed and does not remain outstanding in their books.  However, of late, the Authority has been receiving complaints from aggrieved policyholders that the said instrument of discharge voucher is being used by the insurers in the judicial fora with the plea that the full and final discharge given by the policyholders extinguish their rights to contest the claim before the Courts.

     While the Authority notes that the insurers need to keep their books of accounts in order, it is also necessary to note that insurer shall not use the instrument of discharge voucher as a means of estoppel against the aggrieved policy holders when such policy holder approaches judicial fora. Accordingly insurers are hereby advised as under:

     Where the liability and quantum of claim under a policy is established, the insurers shall not withhold claim amounts.  However, it would be clearly understood that execution of such vouchers does not foreclose the rights of policy holder to seek higher compensation before any judicial fora or any other fora established by law.

     All insurers are directed to comply with the above instructions."

10.     Not only this, Hon’ble Supreme Court of India in this regard in case United India Insurance Vs. Ajmer Singh Cotton & General Mills & Ors., II (1999) CPJ 10 (SC) has held as under:-

"The mere execution of the discharge voucher would not always deprive the consumer from preferring claim with respect to the deficiency in service or consequential benefits arising out of the amount paid in default of the service rendered.  Despite execution of the discharge voucher, the consumer may be in a position to satisfy the Tribunal or the Commission under the Act that such discharge voucher or receipt had been obtained from him under the circumstances which can be termed as fraudulent or exercise of undue influence or by misrepresentation or the like.  If in a given case the consumer satisfies the authority under the Act that the discharge voucher was obtained by fraud, mis-representation, under influence or the like, coercive bargaining compelled by circumstances, the authority before whom the complaint is made would be justified in granting appropriate relief.  However, where such discharge voucher is proved to have been obtained under any of the suspicious circumstances noted hereinabove, the Tribunal or the Commission would be justified in granting the appropriate relief under the circumstances of each case.  The mere execution of the discharge voucher and acceptance of the insurance claim would not estopple insured from making further claim from the insurer but only under the circumstances as noticed earlier.      ............................." 

11.     The main contention of the complainant is that as per the regulations/ instructions issued by IRDA, the claims made under the Insurance Policies are ordinarily  to be settled within one month of the submission of the claim. Hence, the aforesaid act of the opposite parties of non settlement of his genuine claim in time,  is illegal, unwarranted and uncalled for. On the other hand, ld.counsel for the Opposite Parties has rebutted this contention on the ground that due to unfortunate death of previous surveyor, the second final surveyor could not be appointed well within time and due to this reason, the claim could not be processed in time, but we do not agree with this contention of the Opposite Parties because the consumer should not be suffered due to lapse on the part of the insurance company as it was not the fault of the complaint to ask the Opposite Parties time and again for appointment of further surveyor upon the death of previous surveyor.  Regulation  9 of The Insurance Regulatory and Development Authority (Protection of Policyholder’s Interest) Regulations, 2002 directs the Surveyors to submit their Survey Report within 30 days and in any case within 45 days, from the date of his appointment. The Insurer has been directed to make settlement within 30 days of receipt of Surveyor’s report. Regulation 9 (6) provides as follows:-

Regulation-9(6). Upon acceptance of an offer of settlement as stated in sub-regulation (5) by the insured, the payment of the amount due shall be made within seven days from the date of acceptance of the offer of by the insured. In case of delay in the payment, the insurer shall be liable to pay interest at a rate which is 2 per cent, above the bank rate prevalent at the beginning of the financial year, in which the claim is reviewed by it.

In this regard, recently Hon’ble National Consumer Disputes Redressal Commission, New Delhi in Consumer Case No. 50 of 2008  titled as National Aluminum Company Limited Vs. Reliance General Insurance Company Limited, decided on 4^th January, 2022 also held so and directed the insurer to reimburse the claim amount   along with interest @ 10% per annum till the date of payment.  Not only this, in case titled as III (2007) CPJ2 (NC) Paramount Iron and Steel Works Vs. Oriental Insurance Company of Hon’ble National Consumer Disputes Redressal Commission, New Delhi, it is held that  “mere because the claim is huge and if the amount is not paid insured suffers a lot and whole purpose of obtaining insurance cover is frustrated. Opposite Party not permitted to withhold same and liable to pay the due amount alongwith interest @ 10% per annum.  Hence, for such delay, the Insurance Company should pay adequate compensation to the insured”. In similar case, Hon’ble State Consumer Disputes Redressal Commission, Punjab Chandigarh, in case titled as Oriental Insurance Company Limited Vs. Rajbir Kaur, in First Appeal No. 711 of 2013 decided on 27.02.2015 has directed the Insurance Company and stated that as per the regulations/ instructions issued by IRDA, the claims made under the Insurance Policies are ordinarily  to be settled within one month of the submission of the claim. Not only this, recently Hon’ble State Consumer Disputes Redressal Commission, Punjab at Chandigarh in First Appeal No. 416of 2019 in case titled as New India Assurance Company Vs. Lizwant Masih decided on 24.11.2021 held  under head “15. Claim Procedure in respect of a general insurance policy” that in the event of the claim is not settled within 30 days, the insurer shall be liable to pay interest at a rate, which is 2% above the bank rate till the date of actual payment.  Hence, we are of the view that there is certainly deficiency in service on the part of the Opposite Parties who did not bother to make the insurance claim to the complainant well within time as held above.   

12.     Now come to the quantum of compensation. The late payment of the claim amount is not disputed by the Opposite Parties. The complainant in his complaint has claimed the amount of compensation alongwith interest @ 12% per annum, we are of the view that this rate of interest is at high side, and we allow the claim of the complainant alongwith interest @ 9% per annum  instead of 12% per annum as detailed below:

13.     Resultantly, the instant complaint is allowed  partly and the Opposite Parties-Insurance Company is directed to make the payment of Rs.3,08,000/- (Rupees three lakhs eight thousands only) to the complainant directly  alongwith interest @ 8% per annum from  the date of filing the present complaint i.e. 11.12.2020 till its realization. Opposite Parties-Insurance Company is also directed to pay the lump sum compensation to the complainant to the tune of Rs.10,000/- (ten thousands only) on account of harassment, mental tension  and litigation expenses. The compliance of this order be made by the Opposite Parties-Insurance Company within 45 days from the date of receipt of copy of this order, failing which the complainant shall be at liberty to get the order  enforced  through the indulgence of this District Commission.  Copies of the order be furnished to the parties free of cost. File be consigned to record room after compliance.

14.     Reason for delay in deciding the complaint.

          This complaint could not be decided within the prescribed period because the State Government has not appointed any of the Whole Time Members in this Commission for about 3 years i.e. w.e.f. 15.09.2018 till 27.08.2021 as well as due to pandemic of COVID-19.

Announced in Open Commission.

Dated:28.03.2022.