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RAJASTHAN STATE CONSUMER DISPUTES
REDRESSAL COMMISSION, JAIPUR
Hon’ble Mr. Justice N.C. Sharma, President; Mrs. Firoza Bano &
Mr. Subhash Purohit, Members
SOHAN LAL SHRINGI—Appellant
versus
UNITED INDIA INSURANCE COMPANY LTD.—Respondent
Appeal No. 1611 of 1994—Decided on 4.12.1996
Counsel for the Parties :
For the Appellant :Mr. Chetan Dhabhai, Advocate.
For the Respondent:Mr. M.L. Vyas, Advocate.
A consumer is entitled to compensation for deficiency in service by a business, including delay in settlement of an insurance claim.
Headnote:
CONSUMER PROTECTION ACT, 1986 - INSURANCE - MOTOR VEHICLE INSURANCE - CLAIM - DELAY IN SETTLEMENT - INTEREST - DEFICIENCY IN SERVICE - COMPENSATION.
Fact of the Case:
The complainant, the registered owner of an Ambassador car insured with the opposite party, United India Insurance Company Limited, filed a complaint under the Consumer Protection Act, 1986, alleging deficiency in service and seeking compensation for the delay in settlement of his claim arising from an accident involving the insured car.
Finding of the Court:
The District Forum dismissed the complaint, holding that the complainant should have first resorted to arbitration as per the arbitration clause in the insurance policy and that the complaint was not maintainable under the Consumer Protection Act. The complainant appealed the decision.
Issues: 1. Whether the complaint was maintainable under the Consumer Protection Act, 1986. 2. Whether there was deficiency in service on the part of the insurance company. 3. Whether the complainant was entitled to compensation for the delay in settlement of his claim.
Ratio Decidendi: 1. The Consumer Protection Act, 1986, provides a remedy to consumers for deficiency in service by businesses. In this case, the complainant was a consumer of the insurance company's services, and the insurance company's failure to settle his claim promptly constituted a deficiency in service. Therefore, the complaint was maintainable under the Consumer Protection Act. 2. The insurance company had the option to repair, reinstate, or replace the damaged vehicle or to pay the complainant the amount of the loss or damage. The insurance company chose to pay the complainant the amount of the loss or damage. However, the insurance company delayed in settling the claim and did not tender the assessed amount to the complainant. This delay constituted a deficiency in service. 3. The complainant was entitled to compensation for the delay in settlement of his claim. The court awarded the complainant interest on the amount of the loss or damage from the date of the insurance company's letter requiring the complainant to submit cash memos and repair bills until the date of payment.
Final Decision: The court allowed the appeal, directed the insurance company to pay the complainant the amount of the loss or damage, and awarded the complainant compensation for the delay in settlement of his claim.
Mr. Justice Navin Chandra Sharma, President — This appeal has been filed by the complainant against the order of District Forum, Bundi dated 2.8.94 dismissing the Complaint Case No. 219/1993 filed by the complainant on the ground that the same was not maintainable under the Consumer Protection Act, 1986 and if the complainant so wished, he can file a regular civil suit in a Civil Court for appropriate relief.
2. Facts leading to the filing of this appeal are that the complainant was registered owner of an Ambassador Car bearing registration No. RJG 8535. This Ambassador car was insured with the United India Insurance Company Limited under a Cover Note No. 516206 for the period from 23.12.91 to 22.12.92. According to the complainant, the insured car met with an accident on 28.9.92 and a First Information Report of the accident was lodged at Police Station, Talera. The complainant had informed of the accident to the branch office of the opposite party at Bundi. The complainant stated that the opposite party got a spot survey made and after the spot survey, according to the directions of the branch office of the Insurance Company, the car was brought to Kota at the shop of Meratwal Motors. The complainant alleged that the opposite party then appointed another Surveyor who came to Kota and inspected the accidented car at the premises of Meratwal Motors. The complainant alleges that he told the owner of the Meratwal Motors to prepare estimate regarding the loss sustained by the car due to the accident, but the second Surveyor told to the complainant to wait for the estimate. M/s. Meratwal Motors, therefore, did not give to the complainant the estimate of replacement and repairs. The second Surveyor asked the complainant to come to his office at Jaipur. The complainant further alleged that the second Surveyor charged the fees of Rs. 3,000/- from the complainant for getting the estimate prepared. The complainant requested the opposite party to get the estimate prepared several times, but no attention was paid to the request. The complainant, therefore, intended to bring the accidented car to Jaipur for repairs and he was permitted to do so by the opposite party Insurance Company. Accordingly, the complainant brought the car after getting it toed on 27.11.92 at the premises of Western Indian States Motor Company, M.I. Road, Jaipur. The complainant incurred an expenditure of Rs. 2,200/- in bringing the car to Jaipur. The complainant alleged that the opposite party did not want to settle his claim. It took no steps to get the estimate pre pared and to obtain the report of the Surveyor. After much delay, an estimate was got prepared from Western Indian States, Motor Company and the complainant submitted to the opposite party the estimate papers on 3.12.92. The complainant stated that he had purchased the Ambassador Car because he had fracture in spinal cord and therefore, he could not travel by bus as the car had met with accident, the complainant had visited Kota and Jaipur by taxi several times and he had to incur a total expenditure of Rs. 10,000/- as taxi charges. The complainant further alleged that the accidented car was lying at the premises of Western Indian States Motor Company without the same being repaired by the said company because the opposite party had not issued instructions for getting the car repaired. According to the opposite party, Western Indian States Motor Co. had demanded from him an amount of Rs. 50,000/- as advance for carrying out the repairs. The opposite party had not made any payment to the complainant. It was further alleged that the Western Indian States Motor Company had informed the complainant that it would charge rent @ 100/- per day with respect to the period during which the car remains lying at their premises without directions for repairs. Due to the opposite party not permitting the repairs of the car, the complainant had been deprived of the use of the car and he had also to pay interest to
