Amalndu Rudra vs ORIENTAL INSURANCE CO LTD

BY this appeal under Section 15 of the Consumer Protection Act, 1986, the order dated 9.3.2005 in Complaint No. 272/2004 by the District Consumer Disputes Redressal Forum, Durg (hereinafter called the District Forum for short) dismissing the complaint, on the ground that the respondent/insurer has already paid to the complainant/appellant a sum of Rs. 3,73,500, towards settlement of his claim has been put under challenge.

THE relevant facts necessary for the disposal of this appeal stated briefly are that, the complainants vehicle C.G. -07 -C -1224, comprehensively insured for an assured sum of Rs. 8 lac with the respondent/insurer for the period from 20.3.2004 to 19.3.2005, met with an accident on 11.5.2004 on Bhopal -Hoshangabad Road, resulting in substantial damage to the insured vehicle. Intimation of the accident was given to the respondent/insurer by the complainant. The respondent/insurer appointed Surveyor, K.K. Sharma. He assessed the damage on total loss basis, less salvage value to the extent of Rs. 4,98,000. However, the complainant has been paid Rs. 3,73,500, as per respondents/insurers letter dated 2.9.2004 and the complainant received the said amount as per receipt dated 10.9.2004. The said receipt stated that the amount has been accepted in full and final settlement of his claim by the complainant. However, it appears, immediately thereafter, on 17.9.2004, that the complainant sent a letter to the respondent/insurer stating that negotiations were held by him with Surveyor K.K. Sharma, in the presence of Senior Branch Manager, P.K. Dutta and D.O. Mr. Sarda and, the complainant has agreed that he would accept the claim on total loss basis for Rs. 8 lacs less cost of salvage Rs. 3,02,000. It was also stated in the said letter that, since the complainant was not getting response from the respondent/insurer, he considered it proper to dispose of the salvage as he did not want to salvage to further deteriorate. It was also stated in the said letter dated 17.4.2004 that after great delay, he received only Rs. 3,73,500 along with the discharge voucher. He further stated in the said letter that though he strongly protested the payment as above, he has accepted the amount. He prayed that his claim for Rs. 4,98,000 as per settlement, be paid. It would, therefore, be clear from the above letter dated 17.9.2004 that the complainant did not accept Rs. 3,73,500 towards full and final settlement. Though, he appears to have issued printed receipt in that regard, but he sent a letter of protest to the respondent/insurer.

THE District Forum in the impugned order held that, since the complainant has received Rs. 3,73,500 in full and final settlement of his claim, he could not succeed in his complaint.

LEARNED Counsel for the parties heard. Record perused. Learned Counsel for the respondent submitted that the amount having been received in full and final settlement of his claim, no protest could be raised by the complainant, thereafter. Learned Counsel in the above context relied upon the decisions of the National Commission in Sri Jayajothi & Co. Ltd. v. The Oriental Insurance Co. Ltd., III (2002) CPJ 179 (NC)=2003 NCJ 219 (NC) and M/s. Arora Knitting Industries Pvt. Ltd. v. United India Insurance Co. Ltd., III (2002) CPJ 205 (NC)=2003 (1) CPR 72 (NC). The ratio of the said decisions is that once the insured accepted the amount in full and final settlement of his claim and no protest was raised by him, he cannot complain of deficiency in service. In the above context decisions of the State Commissions as noted below were cited. The decisions of the State Commission, U.T.: Chandigarh in Sahib Singh Bachhal v. National Insurance Co. Ltd., I (2003) CPJ 55=2003 (1) CPR 371. State Commission Gujarat, Ahmedabad in Muhammad Faruq Abdul Najid Vaska v. United India Insurance Co. Ltd., I (2003) CPJ 548=2003 (1) CPR 617. State Commission, Bihar, Patna, in The Oriental Insurance Co. Ltd. & Anr. v. Shashi Mohan Singh, I (2001) CPJ 158=2001 (1) CPR 124. State Commission, Tamil Nadu, Chennai, in Neo Intex Mills Ltd. v. The Oriental Insurance Co. Ltd., I (2002) CPJ 158=2002 (1) CPR 342. State Commission, Maharashtra, Mumbai, in Dhani Ram Sunder Lal v. The Oriental Insurance Co. Ltd. & Anr., IV (2004) CPJ 51=2005 (1) CPR 236. Some other cases, were also relied upon, which do not appear to be relevant.

AS against this, the learned Counsel for the complainant/appellant cited the decision in New India Assurance Co. Ltd. v. Shiv Khanna, in II (2004) CPJ 51 (NC), Appeal No. 153 of 2001 decided on 12.2.2004 reported in the Landmark Judgments on Insurance, wherein it was held that if the amount was received in full and final settlement, but such settlement is protested against within a reasonable period, the same can be reconsidered.

LEARNED Counsel for the complainant/appellant submitted that the circumstances of the instant case clearly indicate that the complainant/appellant had negotiations with the Surveyor, K.K. Sharma, appointed by the respondent/insurer himself, and that the complainant had agreed to accept the sum of Rs. 4,98,000 without salvage. The contentions as above, also appear to be substantiated by the report of the Surveyor K.K. Sharma. It also appears that, even after settlement and report of the Surveyor as above, the said amount was not paid and instead Rs. 3,73,500 was offered to the complainant with a letter dated 2.9.2004 and the said amount was received by the complainant/appellant on 10.9.2004. However, it is clear from the letter dated 17.9.2004 of the complainant that he was in fact compelled to receive the amount; though his claim was not settled properly. Therefore, after he received the amount he lodged a protest against the inadequacy of the amount as above. Therefore, even if the receipt recites that the amount was paid and received in full and final settlement of his claim, that does not appear to be in fact so. Needless to say, it is always a question to be decided on the facts of each case, as to whether the amount was received by the owner of the vehicle in full and final settlement of his claim. If the facts and circumstances of the case indicate that the amount was received by the insured, in full and final settlement of his claim, he cannot succeed in his complaint. However, if it is found that the amount was not paid to the insured in full and final settlement in actuality, then his grievance deserves to be considered on merits.

IN the instant case, we find that the complainant has received an amount of Rs. 3,73,500 but has immediately raised protest against the inadequacy thereof, mentioning the settlement of the claim with the Surveyor for an amount of Rs. 4,98,000. The settlement as above is also evidenced by the report of the Surveyor. In the circumstances, there appears to be no rationale as to why the complainant would agree to receive a much lesser sum of Rs. 3,73,500 towards full and final settlement of his claim. We consider that even if printed discharge receipt issued by the respondent/insurer was signed by the complainant, that would not evidence for the full and final payment of claim of the complainant/appellant. He is, therefore, entitled to balance amount, as has been prayed by him.

ACCORDINGLY , the appeal is allowed. The impugned order dismissing the complaint is set aside. It is directed that the respondent/insurer shall pay to the complainant/appellant Rs. 1,24,500 (Rupees one lac twenty four thousand and five hundred only) (Rs. 4,98,000 - Rs. 3,73,500) with interest @ 9% per annum payable thereon, from 10.9.2004. The respondent shall also pay the cost of this litigation including that of the complaint as well as of this appeal, which is quantified as Rs. 3,000 (Rupees three thousand) only. Appeal allowed. -