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2025 Supreme(Online)(NCDRC) 3643
NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION
Mr. Subhash Chandra, Presiding Member, AVM J. Rajendra, AVSM VSM (Retd.), Member
Sheela Foam Pvt. Ltd. – Appellant
Versus
The New India Assurance Co. Ltd. – Respondent
CONSUMER COMPLAINT NO. 410 OF 2013
For the Appellants/Petitioners: Ms. Sunita Harish
For the Respondents: Mr. P. K. Seth, Ms. Alana Mohammed
Unreasonable delay in settling an insurance claim constitutes deficiency in service, warranting interest as compensation.
Headnote:(A) Consumer Protection Act, 1986 - Section 21 - Complaint alleging deficiency in service and delayed insurance claim settlement - Claim approved and paid post significant delay causing financial hardship to complainant - Court directed payment of interest due to such delay. (Paragraphs 1, 16, 15)
(B) Insurance Claim - Duty of surveyor to assess damage - Delay in submission of survey report and disbursement of the claim by insurer - Complainant's claim of coercion in signing discharge voucher scrutinized; found to be unfounded as amount was communicated.
Facts of the case:
The complainant, a private company, filed a complaint against the insurer for inadequate settlement of a claim after a fire incident, resulting in extensive losses. The complainant sought over ₹4 crores but received a lower settlement, citing delays and seeking interest.
Findings of Court:
The court found the insurer deficient in service due to substantial delays in finalizing the insurance claim process and awarded interest on the principal amount for the period of delay.
Issues: Main issues included examining whether there was undue delay in the insurance claim settlement and the legitimacy of the discharge voucher signed by the complainant.
Ratio Decidendi: The court ruled that the insurance company was deficient in service due to long delay in claim processing, awarding simple interest as compensation.
Result: The complaint was disposed of with directions for payment of interest but no costs.
| Table of Content |
|---|
| 1. filing a complaint under consumer protection for claim settlement delay. (Para 1 , 2 , 3) |
| 2. opposition's claim of settlement and execution of discharge voucher. (Para 4 , 5) |
| 3. consideration of surveyor's delay in processing claim. (Para 10 , 11 , 15) |
| 4. court's ruling on interest for delay in claim settlement. (Para 12 , 13 , 16) |
JUDGMENT
1. The present Consumer Complaint has been filed under Section 21 of the Consumer Protection Act, 1986 (for short “the Act”) against the Opposite Parties seeking the following directions:
“a) Direct the Opposite Parties to pay to the Complainant a sum of Rs.4,07,33,417 (Rupees Four Crores Seven Lakh Thirty Three Thousand Four hundred and Seventeen Only) together with pendente lite and future interest @ 24% per annum from the date of filing of Complaint till the date of order and thereafter till recovery;
b) Direct the Opposite Parties to pay to the Complainant a total sum of Rs. 5,00,000/- as damages for negligence and deficiency in services and unfair trade practice indulged in by the Opposite Parties:
c) Make such order or further order as may be deemed fit and proper in the circumstances of the case;
d) Award costs of the proceedings.
2. Brief facts of the case, as per the Complaint, are that the Complainant, a Private Limited company, obtained two Standard Fire and Special Perils Policies from OP-2 for its manufacturing unit at 51-A, Udyog Vihar, Greater Noida-201303. The first policy (Policy No. 32030311081100000101) covered the period 14.12.2008 to 13.12.2009 for a sum of Rs. 46.10 Crores with a premium of Rs. 12,76,079. The second policy (Policy No. 32030311091100000063), obtained due to expansion, covered the period 26.06.2009 to 25.06.2010 for a sum of Rs. 63.58 Crores with a premium of Rs. 16,80,009.
3. On 27.08.2009, a fire caused by an electrical short circuit broke out at the factory, resulting in extensive damage to the building, stocks, plant and machinery, and other assets. On the same day, the OP was informed and a surveyor was appointed. The Complainant submitted all requisite documents and estimated the loss at Rs.32.50 Crores, seeking an interim payment of Rs.5 Crores for early reconstruction. Despite full cooperation, the Surveyor submitted the report nearly 18 months later i.e. on 20.02.2011. Instead of settling the claim, OP-2 raised further queries on 31.03.2011, which were duly answered on 07.04.2011 and 14.04.2011. The Complainant continued to urge early settlement due to financial hardship and ongoing reconstruction, which was completed by March 2010. Eventually, by letter dated 02.12.2011, OP-3 informed that the claim had been approved for Rs. 14,21,01,577. A discharge voucher, with the amount column left blank, was signed under compulsion, and the sum was credited to their account on 10.12.2011. It is the case of the Complainant that it had claimed Rs. 23 Crores but received only Rs. 14.21 Crores, without any interim relief, forcing it to avail bank loans and bear high financial costs. On 12.01.2012, they sought interest of Rs. 3,23,28,108 from March 2010 to December 2011 at 13% p.a. Their reminders dated 12.03.2012, 11.04.2013, 03.05.2013, and 21.10.2013, went unanswered. Aggrieved by the deficiency in service by the OPs, the Complainant filed the present complaint.
4. Upon notice, the complaint was resisted by OP by filing their written version contending that the insurance claim in question, stood settled and paid in full and final settlement for a sum of Rs.14,21,01,577 on 10.12.2011. The said amount was duly accepted by the Complainant without protest and in unequivocal terms, along with a duly signed discharge voucher. Thus, no consumer dispute remained in existence between the parties thereafter, and the present complaint is not maintainable either in law or on facts. The reliefs sought are beyond the scope of the policy. OP further submitted that upon receipt of intimation of the incident, preliminary and final surveys were promptly conducted by
