HINDUSTAN PETROLEUM CORPORATION LTD. vs BENU GOPAL BASU & ORS.

Feeling aggrieved by the order dated 24.02.2010 of the State Consumer Disputes Redressal Commission, West Bengal (in short ''the State Commission"), the petitioner Hindustan Petroleum Corporation Ltd. has filed revision petition No.1611 of 2010 before this Commission. Against the same order of the State Commission another Revision Petition No.2036 of 2010 has been filed by M/s. Lokenath Cooking Gas Distributor of the Hindustan Petroleum Company. For examining the matter, the RP No.1611 of 2010 will be taken as the lead case.

In short the facts of the case are that fire and blast took place on 16.7.2004 at the premises of the respondent Nos.1 and 2 when the workman of the respondent No.3, M/s. Lokenath Cooking Gas Distributor of Hindustan Petroleum Corporation Ltd. was checking the LPG connection in the premises. The respondent Nos.1 and 2 filed a consumer complaint before the District Consumer Disputes Redressal Forum South 24-Parganas, Judges" Court, Alipore, Kolkata, (in short ''the District Forum'') and District Forum vide its order dated 18.8.2009, passed the following orders:- "In the circumstances of the case we allow the case with cost after passing following direction:

The O.P-2 is directed to send a claim form to the complainants stating the actual name of the insurance company to which the claim is to be lodged. This should be sent within 10 days from this date of order.

The complainants shall after filling up of the claim form along with the supporting documents, in original shall submit it to the O.P-2 who will pursue the matter with the Insurance Company and give intimation to the complainants mentioning the date when it has been received by the said insurance company. It is desirable that the claim should be settled by the Insurance Company at the persuasion of The O.P-2 within 45 days from the date of receipt of the claim and the O.P-2 must obtain a copy of this order from the Forum and send it to the concerned Insurance Company along with the claim application of the complainant.

For the deficiency on the part of the O.Ps, we do not pass any order of compensation.

The O.P. no.2 is directed to pay a litigation cost of Rs.2000/- to the complainants within 30 days from the date of order.

The case against O.P-1 is dismissed on contest without costs."

The complainants went in appeal before the State Commission, which vide its order dated 24.02.2010, passed the following order:- "The OPs are jointly and severally liable to compensate the complainants to the tune of Rs.2,00,000/- (Rupees two lakhs only). The other portion of the impugned judgment remains intact. The OPs are directed to pay the awarded amounts to the complainants with 30 (thirty) days from the date of receipt of this judgement, failing which the same will accrue interest @9% (nine per cent) per annum for the period of default."

We heard the arguments of the learned counsels of the petitioner, respondent Nos.1 & 2 and of the respondent No.3. We also perused the records carefully.

Learned counsel for the petitioner stated that the District Forum has rightly ordered that there is no deficiency on the part of the petitioner and he is totally discharged from any liability in the case. However, the State Commission has awarded the compensation of Rs.2,00,000/- to be paid by the petitioner and respondent No.3 jointly and severally. The relationship between the petitioner and respondent No.3, who is distributor of the petitioner-company is that of principal to principal and not of principal to agent. In support of his assertion, learned counsel cited the following judgments:- 1) "In Indian Oil Corporation Vs. Consumer Protection Council, Kerala & Anr., (1993) 1 CTJ 1025 (SC)it has been held that:-

"The relationship between Indian Oil Corporation, the appellant and Karthika Gas Agency, the distributor is one of principal to principal basis. The reliance by the authorities below that the circumstances, documents and conduct of parties proved the relationship as of principal and agent is difficult to understand. This is a case in which the 2 respondent nd Karthika Gas Agency has given an unauthorised connection. If it was a legal connection nothing would have been easier than to produce the subscription voucher. Such a voucher as rightly pointed out by the learned counsel for the appellant, is important and will bind the appellant Corporation. The authorities below have not given due importance to the subscription voucher.

The possession of an L.P.G. gas cylinder by Dr. Kamalasanan in this case has not been proved to be authorised. Therefore, on the strength of obtaining possession by means of an unauthorised connection it is not open to the 1 respondent to foist a contract on the st Corporation.

In so far there is no privity of contract between the appellant and the consumer no "deficiency" as defined under Section 2(1)(g) of Consumer Protection Act arises. Therefore, the action itself is not maintainable before the Consumer Forum."

2) In Flame Gas Service, Bikaner & Ors. vs. Aklesh Kumar Bansal & Ors., I (1995) CPJ 78 (NC), it has been mentioned:-

"9. First we take Appeal No.575 of 1992 as in that appeal only a short point is involved. It was argued on behalf of the appellant- Indian Oil Corporation that as per the transaction entered into between the Distributor and the Corporation, the distributor shall act and shall always be deemed to have acted as a principal and not as an agent or on account of Corporation. In support of its contention, reliance was placed on Clause 17 of the contract entered into between the Corporation and M/s. Flame Gas Service, Bikaner. That Clause reads as follows:

"17. In all contracts or engagements into by the Distributor with the customers for sale of LPG and/or the sale and/or installation and/or repairs of appliances and/or connections thereof with LPG cylinders (filled or empty) and/or refills and/or pressure regulators and/or attached equipment the Distributor shall act and shall always be deemed to have acted as a principal and not as an agent or an account of the Corporation, and the Corporation shall not in any way be liable in any manner in respect of such contracts and/or engagements and/or in respect of any act or omission on the part of the Distributor, his servants, agents and workmen in regard to such installation, sale, distribution, connections, repairs or otherwise. The Distributor shall be bound to inform the customers in writing of this provision, through correspondence or at the time of enrolment of the customer."

Learned counsel for the petitioner also mentions that the respondent No.3, M/s. Lokenath Cooking Gas Distributor of Hindustan Petroleum Corporation Ltd. has taken a policy from National Insurance Company Ltd. and the Insurance Company and Distributor are mainly responsible for paying the claim, if any. The petitioner has also taken a Public Liability Insurance policy as an umbrella policy from the United India Insurance Co. Ltd. and the claim in the present case has been submitted to United India Insurance Co. Ltd. If the Insurance Company indemnifies the claim, it will be sent to the respondent Nos.1 and 2.

Learned counsel for the respondent Nos.1 and 2 argued that there were serious burn injuries to both the respondents and the local distributor was requested many times to pay the compensation, but no heed was paid. Therefore, the respondent Nos.1 and 2 filed a consumer complaint before the District Forum. As District Forum did not give specific order for payment of compensation, respondent Nos.1 and 2 preferred an appeal before the State Commission, which has awarded compensation of Rs.2,00,000/-, which is just a reasonable for pain, anguish, medical expenses and mental agony suffered by the respondent Nos.1 and 2.

Learned counsel also cited the following judgment in the case of New India Insurance Co. Ltd. Vs. Hindustan Petroleum Co. & Ors. in RP No.2338 of 2008, decided on 01.07.2015 (NC). It has been held that:- "11. We have considered the rival contentions of the parties carefully. So far as the alleged incident of leakage of gas resulting in the explosion which caused substantial damage to the kitchen and other areas of the house and property of the complainant is concerned, we find that both the fora below have returned their concurrent finding of facts and we have not come across any material irregularity or infirmity which would call for our interference under section 21(b) of the Consumer Protection Act under which the revision

petition has been filed. In this context, we reproduce the observations of the District Forum as under:-

"9. The Sworn affidavit of C.S. Rajan, a professional Chemical Engineer whose vast experience in his technical field could be felt from the material in the Ex.A.10, says the probable reason for the belated explosion. His affidavit says the movement of the persons during the day time with open windows and the closer of the movements and the windows closing during the night time were the reason for the belated explosion due to any ignitions of the Refrigerator switches etc. The said probability being not dis-credit by the other side with any contra material, it remains not only convincing but also a more probable cause. Hence in the light of the above circumstances what conclusively remains established is that the explosion in the kitchen of the complainant"s house was due to gas leakage from the means that supply gas to the stove."

As regards the liability of the OPs, both the fora below have concurrently held the OP Gas Agency and the OP manufacturer liable for the incident jointly and severally. Taking into consideration the reasons recorded by them in their respective orders, we are of the considered view that no interference is called for regarding their concurrent finding about joint and several liability of the OP Gas Agency and the OP manufacturer. However, the State Commission vide its impugned order modified the order of the District Forum and fastened the joint and several liability on the OP Insurance Co. as well. We may note that keeping in view the coverage under the policy issued by the OP Insurance Co. and the terms and conditions contained in the policy document subject to which policy in question was issued, the District Forum dismissed the complaint against the OP Insurance Co. In support of its decision, the District Forum has recorded the following reasons in para 12 of its order:-

"12. The OP No.1.3 apart from taking several please in excuse of the liabilities of the other opposite parties for compensating the complainant for the loss ensured alleging no deficiency of service on their part simultaneously dis-owns of any of its liability for meeting the claim of the complainant submitting that even if the said accident was held at any deficiency of the services of the other opposite parties. It is not liable for the said claim as the insurer of the opposite parties as its liability is limited as per Sec.VII of the terms of the policy in Ex.B.3(1) to the occurrence caused during the installation of the gas cylinders by the insured or by his authorized agents at the premises of the insured customers or whilst such cylinders are being carried from the insured premises for their installation in insured customers premises of whilst such empty cylinders were in the course of being carried from the insured customers premises to the insured premises and while lying at the insures premises and as the alleged incident ensuing damage to the complainant"s house not happened in any of the above circumstances. The perusal of the provision in Ex.B.3 sounds well in support of the opposite party No.3 stands as the occurrence in the kitchen of the complainant occurred long after the attendance of the complaint of the gas leak and not at the time of installation or the movements of the cylinders as indicated above. Hence there appears every bonafidies in the defence of the opposite party No.3 as to its liability for its insured in compensating the claim of the complainant. Therefore, the opposite party No.3 being at no liability for the complainant"s claim the case of the

complainant against the opposite party No.3 dismissed for want of proper cause of action." 16. Perusal of the impugned order passed by the State Commission indicates that the State Commission has modified the order of the District Forum and fastened the joint and several liability for the alleged incident against the OP Insurance Co. without recording any cogent reasons for such decision. Keeping in view the specific coverage provided under the policy and that too in favour of the OP Gas Agency, the State Commission gravely erred in holding the OP Insurance Co. as jointly and severally liable under the impugned order along with OP Gas Agency and OP manufacturer. Admittedly, the OP Insurance Co. had not issued any cover to the OP manufacturer, i.e., Hindustan Petroleum Corporation. We, therefore, modify the impugned order of the State Commission to this extent by dismissing the complaint against the OP Insurance Co., petitioner herein in revision petition No.2338 of 2008."

Learned counsel for respondent No.3 mentions that he is working on behalf of petitioner selling LPG gas cylinder. If there are any defects in the cylinder or its contents, the manufacturing company i.e. petitioner would also be responsible. So far as the claim of the respondent Nos.1 and 2 is concerned claim is to be indemnified by the National Insurance Company as the respondent No.3 has taken a policy covering such cases from them. Inspite of the request, the respondent Nos.1 and 2 have not submitted the claim form as advised by respondent No.3 and therefore, the same could not be submitted to the Insurance Company. The District Forum has rightly ordered that the respondent Nos.1 and 2 should complete the claim form and the same would be forwarded by respondent No.3 to the Insurance Company. Though, the Insurance Company has not been made party in the proceedings right from the initial stage before the District Forum, the compensation has to be commensurate with the expenses. The total medical expenses by the respondent Nos.1 and 2 are not more than Rs.8,000//-. Therefore, the compensation of Rs.2,00,000/- (Rupees Two Lakh) is not justified. Learned counsel stated that it is the primary responsibility of Insurance Company to indemnify the claim and the manufacturer i.e. the petitioner is also equally responsible. In support of his assertion, learned counsel cited the judgment of the National Commission in New India Assurance Co. Ltd. Vs. Kaluraj Jasraj Vyas & Ors., FA No.196 of 2006, decided on 30.01.2008. It has been held that:- "In our view, referring to the aforesaid terms of the clause, it is apparently vague. However, it inter alia, specifically provides that the Insurance Company will indemnify the insured in respect of all sums which the insured is legally liable to pay as compensation in case of accidental damage to property caused by or arising from the installation of gas filled liquefied petroleum gas cylinder in the premises of the Insured"s customers.

Undisputedly, in the present case, the damage has taken place in the customer"s premises. In this view of the matter, it cannot be said that the order passed by the State Commission directing the Insurance Company to reimburse the Complainant is in any erroneous.

At the same time, it is to be stated that because of the defective cylinder or the regulator the accident has taken place, and hence, it cannot be held that the Dealer or the HPCL would not be liable. Primary liability would be that of the HPCL.

In this view of the matter, it is held that the dealer and the HPCL would be jointly and severally liable to pay compensation to the Complainant. However, as the insurance cover is taken by the dealer, the Insurance Company would be also liable. In the result, the appeal is partly allowed and the order passed by the State Commission is modified accordingly."

From the arguments advanced by the learned counsels of the parties, we agree with the view that the relationship between the petitioner Company, Hindustan Petroleum Corporation Ltd. and the respondent No.3, M/s. Lokenath Cooking Gas Distributor of Hindustan Petroleum Corporation Ltd. is in the nature of principal to principal and not as principal to agent. The incident occurred when the employee of M/s. Lokenath Cooking Gas Distributor of Hindustan Petroleum Corporation Ltd was checking the gas connection at the premises of respondent Nos.1 and 2. In this respect, we agree with the finding of the District Forum in discharging the petitioner, Hindustan Petroleum Corporation Ltd. from liability in this case.

We are also of the opinion that in such a case where the policy has been taken by the distributor, the claim should have gone to the Insurance Company, which has not been made party in the proceedings. The complainant has not filled the claim form even after the decision of the District Forum. The view of the State Commission is that once the complaint has been filed, it should be decided in terms of compensating the complainant. We agree with this view, but the question is how much compensation be paid. In this case, the claim form was required to be sent to the Insurance Company and the same would have been paid by Insurance Company. We also agree with the assertion of the learned counsel for the petitioner in RP No.2036 of 2010 that the compensation was on a very high side and no reason has been given by the State Commission to fix the compensation at this level. Accordingly, we are of the opinion that the compensation of Rs.1 lakh only would be just and reasonable in the circumstances of this case. The petitioner in RP No.2036 of 2010 i.e. M/s. Lokenath Cooking Gas Distributor of Hindustan Petroleum Corporation Ltd. may get this money from the Insurance company, if he so desires. If the insurance amount is more than Rs.1 lakh, the excess amount over Rs.1 lakh will be paid to the complainants.

Based on the above discussions the order of the State Commission dated 24.2.2010 is modified to the extent that liability will be limited only to the M/s. Lokenath Cooking Gas Distributor of Hindustan Petroleum Corporation Ltd. and not jointly and severally with the Hindustan Petroleum Corporation Ltd and that the amount of compensation will be Rs. 1 lakh ( Rupees one lakh only) instead of Rs. 2 lakh as awarded by the State Commission. Rest of the order of the State Commission remains unchanged.

Both the Revision Petitions No.1611 of 2010 and No.2036 of 2010 stand disposed of in terms of the above order.