National Insurance Company vs Poshkar Nath Pandita and Sons

The claimants before the Commission, Respondents herein, approached the Commission seeking compensation from the Appellant for loss

suffered by them, as a result of malicious activities of certain unknown persons, under a policy of Insurance issued by the Appellant. The

Commission held that the claim is not entertainable as the same is barred by law. On an appeal, the said decision of the Commission was interfered

with when, looking into various documents, including some which were not produced before the Commission, the Division Bench felt that the claim

cannot be said to be spurious or belated. However, inasmuch as those documents were not before the Commission, while the Division Bench

observed that the reasons assigned by the Commission that the claim is not substantiated by the contemporaneous documents does not appear to

be a correct finding, felt that the matter needs re-examination on merit by the Commission. Before the Division Bench, it was contended by the

Respondent-Insurance Company that the claim having been resulted by reason of terrorist activities does not come within the peril of mischief

covered by the policy. The Division Bench answered that question against the Insurance Company. While remitting the matter to the Commission,

the Division Bench granted liberty to it to go into the question as to whether the incident in question is covered by any of the clauses of the policy.

Therefore, as appears to us the entire matter was remitted to the Commission. Before the Commission, three defences were taken by the

Insurance Company, namely that the claim was barred by limitation; the claim arising out of loss for the incident is not one of the perils covered by

the Insurance policy; and, there is no evidence that the incident took place.

In the instant case the admitted facts are that the incident allegedly took place on January 28, 1991. A request to depute a surveyor was

received by the Insurance Company on February 6, 1991. The Insurance Company neither deputed a surveyor nor deputed an investigator. The

claim was presented before the Commission on July 25,1995.

Learned Counsel for Appellant-Insurance Company drew our attention to the judgment of the Hon'ble Supreme Court rendered in the case of

Kandimalla Raghavaiah and Co. Vs. National Insurance Co. and Another, . In that case, the Hon'ble Supreme Court was dealing with the

provisions of limitation as prescribed in Section 24A of the Consumer Protection Act 1986 which says in no uncertain terms, that the Commission

shall not admit a complaint unless it is filed within two years from the date on which the cause of action has arisen. The Hon'ble Supreme Court

found as a fact that cause of action by reason of the peril covered by the Insurance policy, i. e., fire, arose on March 22, 1988; whereas the claim

was filed on October 24, 1997 and, accordingly, held that the claim was barred by time. The Consumer Protection Act 1986, under which the

Commission was constituted and before whom the claim was lodged, in Section 24A provides that the Divisional Forum and the State Commission

may not admit a complaint unless it is filed within two years from the date on which cause of action has arisen. Therefore, insofar as the law

applicable to this State is concerned, it is not a complete bar on the State Commission to entertain a claim beyond two years from the date on

which the cause of action has arisen, the same is discretionary. However, in view of Sub-section (2) of Section 24A of the State Act, which

authorises the Commission to condone delay for reasons to be recorded, it must be deemed that the discretion granted to it by Sub-section (1) of

Section 18A must always be used in not entertaining a complaint beyond two years from the date on which the cause of action arises, unless delay

is condoned. However, inasmuch as, in the instant case, after having had considered the respective contentions of the parties, the Division Bench

had already observed that the claim cannot be said to be spurious or belated, we feel that, insofar as the present case is concerned, it was

obligatory on the part of the Commission to use its discretion in entertaining the complaint, without insisting for formal steps to be taken by the

complainant seeking condonation of delay. In other words, having regard to the pronouncements made in the judgment of the Division Bench, there

was a clear indication of grounds for entertaining the claim, though may have had been filed after two years from the date when the cause of action,

i. e., malicious activity resulting in loss, arouse.

Learned Counsel appearing on behalf of Appellant did not argue before us that the peril, which ultimately caused the loss, as was complained of,

was not one of the perils covered by the policy of Insurance. Accordingly, the Appellant accepts the finding of the Commission on that score.

Learned Counsel for the Appellant, however, contended before us that there is no acceptable evidence of the incident resulting in the loss.

Learned Counsel for the Respondents-claimants drew our attention to the oral testimony of Mohd. Amin Bhat, one of the witnesses, who

appeared in support of the complaint before the Tribunal. The manner in which he deposed in examination-in-chief, by filing an affidavit, suggests

that he was a witness to the incident. In cross-examination, no suggestion was even given that he was not present at the time when the incident

took place or that he was not a witness to the incident. Cross-examination of this witness also does not suggest that the Insurance Company

brought on record matters on which the. credibility of the witness was diminished. In the circumstances, placing reliance upon the evidence

tendered by the said witness cannot be said to be impermissible.

That being the situation, we do not find any just reason to interfere with the judgment and award of the Tribunal.

The appeal fails and the same is dismissed.