IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO.5547 OF 2009 (Arising out of S.L.P. (C) No.887 of 2009)

Noor Ali                        ...Appellant(s)

Versus

National Insurance Co. Ltd.                  ...Respondent(s)

O  R  D  E  R

Leave granted.

Heard learned counsel for the parties.

The appellant is engaged in the business of motor  

parts. He took fire insurance policy for the period from 18th  

July, 2003, to 17th July, 2004 for a sum of Rupees ten lakhs.  

On the night intervening 3rd/4th August, 2003, at about 11.00  

p.m., a fire incident took place in which the appellant's  

goods and shops were damaged.  On receipt of intimation from  

the appellant, the respondent deputed a Surveyor and Loss  

Agent,  Shri  K.B.  Mahajan,  who  after  assessment,  submitted  

report dated 15th December, 2003.  Shri Mahajan assessed the  

loss  to  the  appellant  at  Rs.1,79,111/-.   Thereafter,  the  

Insurance  Company  released  Rs.1,21,117/-  in  favour  of  the  

appellant as full and final settlement of his claim.  The  

appellant accepted the amount under protest. This was clearly  

recorded in the form of endorsement made on letter dated 17th  

March, 2004 written by the Branch Manager of the respondent  

to the Senior Manager, Bank of Baroda.

...2/-

- 2 -  

Feeling  aggrieved  by  the  respondent's  refusal  to  

reimburse the loss of Rupees eight lakhs which, according to  

the appellant, was suffered by him in the fire accident, he  

filed a complaint under Section 12 of the Consumer Protection  

Act,  1986.   The  respondent  disputed  the  claim  of  the  

appellant  and  averred  that  in  view  of  the  report  of  the  

surveyor, he was not entitled to anything over and above what  

was already paid.  The respondent also took up the plea that  

after having accepted the amount of Rs.1,29,117/- in full and  

final settlement of his claim, the appellant was not entitled  

to claim higher compensation.  The appellant produced as many  

as  twenty  documents  which  included  report  of  the  Fire  

Officer, Sultanpur, the bank statement for the last three  

years, stock statement for the last three years along with  

covering letter and a list of 168 duplicate cash memos and  

three  balance  sheets  for  the  years  2001-2003.   After  

considering the entire record, the District Consumer Disputes  

Redressal Forum, Sultanpur, [for short, “the District Forum”]  

awarded compensation of Rs.6,70,883/- with interest at the  

rate of twelve per cent per annum from the date of complaint,  

i.e., 5th May, 2004.  Damages of Rs.10,000/- and litigation  

expenses of Rs.200/- were also awarded to the appellant with  

a stipulation that if the amount is not paid, then the rate  

of interest shall be fifteen per cent instead of twelve per  

cent per annum.

On an appeal preferred by the respondent, the State  

Consumer  Disputes  Redressal  Commission  [for  short,  “State  

Commission”],  set  aside  the  order  of  the  District  Forum.  

When the matter was taken up by the appellant in revision,  

National   Consumer  Disputes   Redressal  Commission   [for  

short, “National Commission”], directed the respondent to pay  

...3/-

- 3 -  

Rs.50,000/-  by  observing  that  the  said  amount  had  been  

deducted from the assessment made by the Surveyor's report  

without any justification.

From a bare perusal of the impugned orders of the  

State Commission and the National Commission, it is clear  

that neither of them considered the documents produced by the  

appellant which had been considered by the District Forum  

while  awarding  compensation  of  Rs.6,70,883/-  and  on  that  

account cause of the appellant has been seriously prejudiced.

Accordingly, the appeal is allowed, impugned orders  

passed  by  the  State  Commission  as  well  as  the  National  

Commission are set aside and the matter is remitted to the  

State Commission to consider the appeal in accordance with  

law after giving opportunity of hearing to the parties.

......................J.               [B.N. AGRAWAL]

......................J.               [G.S. SINGHVI]

New Delhi, August 17, 2009.