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2025 Supreme(Online)(NCDRC) 6287
NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION
HON’BLE MR. SUBHASH CHANDRA, HON’BLE AVM J. RAJENDRA, AVSM VSM (Retd.), JJ
THE NEW INDIA ASSURANCE COMPANY LTD. & ANR – Appellant
Versus
M/S. ANUP ROADLINES – Respondent
NC/FA/497/2011
An insurer as a subrogee can file a complaint under the Consumer Protection Act only in the name of the assured or jointly with the insured, not solely in its own name.
Headnote:(A) Consumer Protection Act, 1986 - Section 2(1)(d) and Section 19 - Appeal against dismissal of complaint - The State Commission dismissed the complaint filed by the insurance company on grounds of lack of consumer status, holding it was a service provider and not a consumer under the Act. The appellants contended that the letter of subrogation allowed the insurance company to file the complaint. (Paras 1, 5, 11)
(B) Subrogation - The court reiterated that an insurer, as a subrogee, can maintain a complaint under the Act either in the name of the assured or jointly with the insured, provided the complaint is not solely in the insurer's name. (Paras 11)
(C) Negligence - The court emphasized that negligence in service delivery by the transporter gives rise to an actionable claim for damages. (Paras 8)
Facts of the case:
The appellants booked a consignment of poultry feed which was damaged during transit due to negligence in securing the load. The insurance company compensated the insured and sought to recover the amount from the transporter. (Paras 4, 6)
Findings of Court:
The court found that the complaint was not maintainable as the insurance company was not a consumer under the Act, despite the letter of subrogation. (Paras 12)
Issues: The main issues were whether the insurance company could file a complaint as a subrogee and the interpretation of the letter of subrogation. (Paras 5, 11)
Ratio Decidendi: The court ruled that while an insurer can file a complaint as a subrogee, it must be in the name of the assured or jointly with the insured, not solely in its own name. (Paras 11)
Result: Appeal disallowed.
ORDER
PER SUBHASH CHANDRA
1. The appellant is before us in this First Appeal in challenge to the order dated 21.06.2011 of the State Consumer Disputes Redressal Commission, Haryana, Panchkula (for short “State Commission”) in complaint no. 98/1999 under Section 19 of the Consumer Protection Act, 1986 (“Act”). The State Commission had dismissed the claim filed against the respondent on the basis of a letter of subrogation executed by appellant no. 2 in favour of appellant no. 1 holding the complaint as not tenable since appellant no. 1 was not a consumer under Section 2(1)(d) of the Act being a service provider.
2. The delay of 65 days in the filing of the appeal was condoned at admission stage.
3. We have heard the learned counsel for the parties and perused the records carefully.
4. The brief conspectus of facts is that appellant no. 2 booked a consignment of poultry feed supplement from Kupwad, Sangli to Arambagh, Distt. Hooghly by engaging the services of the respondent to transport the same by road/truck. Admittedly, a truckload of 360 bags of poultry feed supplements were booked vide LR No. 3752 dated 18.06.1997 under insurance with appellant no. 1. When the truck reached the destination on 29.06.1997, it was found that 300 bags were drenched due to rain in transit due to shifting of tarpaulin. Notices demanding value of the damaged goods were sent by appellant no. 2 to the respondent on 04.07.1997 and 17.10.1997 to no avail. On 24.10.1997 appellant no. 2 executed a letter of subrogation in favour of appellant no. 1 (insurance company) against receipt of Rs 7,13,093/- from the insurance company. Complaint No. 98/1999 was filed before the State Commission claiming the amount of Rs 7,13,093/- with interest @ 18% with costs. This complaint was dismissed by the State Commission holding as under:
In nutshell, this complaint has been primarily filed by Complainant No. 1, The New India Assurance Co. Ltd. on the basis of letter of subrogation executed by Complainant No. 2 in favour of Complainant No. 1, on Complainant No. 1 paying insurance claim of Complainant No. 2 in view of the loss of goods handed over to opponent by Complainant No. 2 for transportation which got damaged in transit. As such the complaint filed by The New India Assurance Co. Ltd. is not tenable under the Consumer Protection Act, 1986 because insurance company is a service provider, it cannot be said to be ‘consumer’ within the meaning of Section 2(1)(d) of the Consumer Protection Act, 1986 . It cannot be permitted to file or prosecute complaint against anybody.
[Emphasis added]
This order is impugned before us on the ground that appellant no. 2 had executed a Letter of Subrogation in favour of appellant no. 1 who had settled the claim with it and therefore was entitled to file the compliant.
5. The appellant’s case is that the State Commission erred in failing to consider that it had a locus in the matter in view of the letter of subrogation executed by the insured with it. Appellant contended that the Hon’ble Supreme Court in Economic Transport Organization, Delhi Vs. Charan Spinning Mills Pvt. Ltd., (2010) 4 SCC 114 had held that in a matter of transit risk insurance, a complaint against a service provider for damage resulting from negligence of the service provider is maintainable if words of assignment were used in subrogation letter in addition to words of subrogation. The appellant contends that the order is contrary to the settled legal position and violates the principles of natural justice, as the State Commission failed to consider the merits of the case or provide any substantive reasoning. Reliance has been placed on the judgments of the Hon’ble Supreme Court in Economic Transport Organization vs. Charan Spinning Mills Pvt. Ltd. & Anr. and Economic Transport Organization vs. Oriental Insurance Company Ltd. & Anr., reported in (2010) 4 SCC 114 , to substantiate the maintainability of the complaint.
6. The factual matrix reveals that appellant No. 2 en
