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CASE NO.: Appeal (civil)  1602 of 2008

PETITIONER: National Insurance Company Ltd

RESPONDENT: Sehtia Shoes

DATE OF JUDGMENT: 26/02/2008

BENCH: Dr. ARIJIT PASAYAT & P. SATHASIVAM

JUDGMENT: J U D G M E N T  

CIVIL APPEAL NO 1602 OF 2008 (Arising out of SLP (C) No. 12953 of 2005)

Dr. ARIJIT PASAYAT, J.

        1.      Leave granted.

2.      Challenge in this appeal is to the order passed by the  National Consumer Redressal Commission, New Delhi (in  short ’National Commission’).  The National Commission by  the impugned order dismissed the revision petition filed by the  appellant questioning correctness of the order passed by the  Consumer District Forum, Hissar (in short ’District Forum’)  and State Consumer Disputes Redressal Commission,  Haryana (in short ’State Commission’).    

3.      The controversy lies within a very narrow compass.               Claim was lodged by the respondent who had obtained a  shopkeeper insurance policy of the appellant company on  15.7.2001.  A claim was lodged with the appellant stating that  on account of fire insured articles got destroyed. The  Surveyors and Loss Assessors assessed the net loss at  Rs.2,82,301/-.  It is the case of the appellant that respondent  without demur accepted the sum of Rs.2,72,301/- in full and  final settlement and accordingly payment of Rs.2,72,301/-  was made.  Thereafter a complaint was lodged before the  District Forum claiming that his claim was Rs.9 lacs and he  should be indemnified to the extent of Rs.9 lacs less  Rs.2,72,301/- which had been received by him. Appellant  objected to the complaint stating that since the respondent  had accepted the amount without any protest no further claim  survives and the complaint was not maintainable.

4.      The District Forum noted the rival stand including the  stand of the respondent that the so called settlement was  signed by him under coercion and, therefore, the claim  petition was maintainable.  The District Forum awarded a sum  of Rs.4,95,000/-.  In appeal, the State Commission dismissed  the appeal after noticing the rival stands which were  reiteration of the stands taken before the District Forum. A  revision, as noted above, was filed before the National  Commission which dismissed the same holding as follows:

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"In our view, the impugned order passed  by the State Commission does not call for any  interference.  The District Forum as well as  State Commission considered the various  statements including Income-tax and Sales  Tax returns as well as statements submitted to  the bank and also surveyor’s report.  In our  view, the assessment by the surveyor in the  present case cannot be accepted because  surveyor has observed that even though the  shoes were affected by water and smoke, yet  the loss would be only 30% and thereafter  reduced the assessment of loss, in our view  this was unjustified.

Hence revision petition is dismissed."           

5.       Learned counsel for the appellant submitted that though  a claim can be entertained even when there is a settlement to  receive a particular amount, yet the same is subject to the  condition that the earlier settlement was obtained under  coercion and/or was not on account of free will.  In the instant  case it is submitted this vital aspect has been lost sight of by  the District Forum, the State Commission and the National  Commission.

6.      In response, learned counsel for the respondent  submitted that immediately after the so called settlement was  arrived at grievance, was lodged with the authority stating that  settlement was not free and fair.    

7.      In United India Insurance. v. Ajmer Singh Cotton &  General Mills and Ors. (1999 (6) SCC 400), it was, inter alia,  observed as follows:    "4. We have heard learned counsel for the  parties and perused the record. It is true that  the award of interest is not specifically  authorised under the Consumer Protection  Act, 1986 (hereinafter called "the Act") but in  view of our judgment in Sovintorg (India) Ltd. v.  State Bank of India, Civil Appeal No. 82 of  1992 decided on 11.8.1999, we are of the  opinion that in appropriate cases the forum  and the commissions under the Act are  authorised to grant reasonable interest under  the facts and circumstances of each case. 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, misrepresentation, undue influence

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or the like, coercive bargaining compelled by  circumstances, the authority before whom the  complaint is made would be justified in  granting appropriate relief. However (sic so),  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  estop the insured from making further claim  from the insurer but only under the  circumstances as noticed earlier. The  Consumer Disputes Redressal Forums and  Commissions constituted under the Act shall  also have the power to fasten liability against  the insurance companies notwithstanding the  issuance of the discharge voucher. Such a  claim cannot be termed to be fastening the  liability against the insurance companies over  and above the liabilities payable under the  contract of insurance envisaged in the policy of  insurance. The claim preferred regarding the  deficiency of service shall be deemed to be  based upon the insurance policy, being  covered by the provisions of Section 14 of the  Act.

5. In the instant cases the discharge vouchers  were admittedly executed voluntarily and the  complainants had not alleged their execution  under fraud, undue influence,  misrepresentation or the like. In the absence of  pleadings and evidence the State Commission  was justified in dismissing their complaints.  The National Commission however granted  relief solely on the ground of delay in the  settlement of claim under the policies. The  mere delay of a couple of months would not  have authorised the National Commission to  grant relief particularly when the insurer had  not complained of such a delay at the time of  acceptance of the insurance amount under the  policy. We are not satisfied with the reasoning  of the National Commission and are of the view  that the State Commission was justified in  dismissing the complaints though on different  reasonings. The observations of the State  Commission in Jivajeerao Cotton Mills Ltd. v.  New India Assurance Co. Ltd, OP No. 52 of  1991 decided on 28.11.1991, shall always be  construed in the light of our findings in this  judgment and the mere receipt of the amount  without any protest would not always debar  the claimant from filing the complaint."

8.      Filing of a complaint is, therefore, not barred; but it has  to be proved that agreement to accept a particular amount was  on account of coercion.  In the instant case, this relevant  factor has not been considered specifically by the District  Forum, State Commission and the National Commission.    Though plea of coercion was taken by claimant-respondent,

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same was refuted by the appellant.  There is no dispute that  the discharge voucher had been signed by the respondent.   There has to be an adjudication as to whether the discharge  voucher was signed voluntarily or under coercion.  We remit  the matter to the District Forum for fresh consideration.   It  would do well to dispose of the matter as early as practicable,  preferably by the end of September, 2008.   

9.      The appeal is allowed to the aforesaid extent.  No costs.