NEW INDIA ASSURANCE CO LTD vs RANI TIWARI & ORS

Ajit Bharihoke, Presiding Member

[1] This revision is directed against the order of the U.P. State Consumer Disputes Redressal Commission, Lucknow (in short, "the State Commission") dated 18.1.2010 in first appeal No.611/2008 whereby the State Commission held the petitioner insurance company liable to pay to the respondent No.1/complainant a sum of Rs.3 Lakhs.

[2] Briefly stated, facts relevant for the disposal of the revision petition are that respondent No.1 Rani Tiwari widow of Shri Vinod Tiwari filed consumer complaint No.150/2006 in the District Forum, Noida on the allegations that her husband during his lifetime had taken credit card facility from M/s G.E. Money Financial Services Ltd. Late Shri Vinod Tiwari was issued a credit card and in accordance with the terms and conditions of the scheme of credit card, an insurance cover of Rs.6.5 Lakhs was extended to him. The complainant pleaded that her husband died in a road accident on 9.1.2006. She, thus, submitted insurance claim with the finance company but the opposite party finance company failed to settle the claim, which according to the complainant amounts to deficiency in service.

[3] The opposite party finance company on being served with the notice, contested the complaint with the averment that the finance company had no liability under the terms and conditions of the credit card scheme. It was pleaded that as per the scheme insurance amount of Rs.1 Lakh was to be paid by New India Assurance Co. Ltd. while SBI Life Insurance Co. Ltd. under the scheme was liable to pay a sum of Rs.3 Lakhs against the insurance claim. It is pertinent to note that in the complaint before the District Forum, neither the New India Assurance Co. Ltd. nor the SBI Life Insurance Co. Ltd. were arrayed by the complainant as opposite parties.

[4] Learned District Forum on consideration of pleadings of the parties allowed the complaint filed by the respondent No.1/complainant and directed the above-noted finance company to pay to the complainant a sum of Rs.5 Lakhs with all benefits with 12% interest from the date of institution of complaint i.e. 24th August, 2006 till the realization of amount. Besides a sum of Rs.25,000/- was awarded as compensation and Rs.2,000/- as litigation expenses.

[5] M/s G.E. Money Financial Services Ltd. being aggrieved of the order of the District forum preferred an appeal in the State Commission. In the appeal besides impleading respondent No.1/complainant as a party the aforesaid finance company also arrayed New India Assurance Co. Ltd. as also the SBI Life Insurance Co. as respondents. The petitioner insurance company as also the SBI Life Insurance Co. Ltd. challenged their impleadment for the first time in the appeal on the plea that they were not the parties in the original complaint and denied their liability towards the complainant.

[6] The State Commission after hearing the parties modified the order of the District Forum and directed as under: - "The long and short of the discussions made above is that the complainant shall be entitled to get Rs.1,00,000/- from the SBI Life Insurance Co. Ltd. and Rs.3,00,000/- from the New India Assurance Co. Ltd. The judgment is modified in terms of above and if the two agencies fail to make the payment good, the appellant finance company shall be liable to shoulder its responsibility of making the entire payment but it shall be fully competent to recover the whole amount from the two agencies to the extent indicated above.

The instant appeal is decided in terms of above. The respondent-complainant shall be entitled to get costs which we quantify at Rs.5,000/-"

[7] Learned counsel for the petitioner has contended that the impugned order of the State Commission is violative of principle of natural justice for the reason that the State Commission has ignored that the petitioner insurance company was not impleaded as opposite party in the consumer complaint and as such it did not get the due opportunity to contest the consumer complaint and present its case before the District Forum in proper perspective. Learned counsel has contended that on this count alone the impugned order is liable to be set aside. It is further contended that the State Commission has failed to appreciate that there was no direct or indirect contract between the petitioner insurance company and the respondent No.1/complainant.

[8] Learned Shri Madhurendra Kumar, Advocate for respondent No.1/complainant on the contrary has argued in support of the impugned order and contended that the State omission has rightly held that there was a tripartite agreement between the petitioner, the finance company and the late husband of the complainant. In support of this contention learned counsel for respondent No.1 has drawn our attention to photocopy of the certificate of insurance purported to have been issued by SBI Life Insurance Co. Ltd. Learned counsel for respondent No.1/complainant has also drawn our attention to photocopy of blank application form wherein it is recorded that New India Assurance Company Ltd. has issued a master policy to G.E. Country Consumer Financial Services Pvt. Ltd. entitling issuance to all G.E. Cash Excess card holders under the master policy subject to conditions of validity. It is contended that from the aforesaid document it is clear that as per the arrangement between the petitioner and the opposite party finance company, a master policy was obtained by the finance company under which the card holders were extended insurance cover.

[9] We have considered the rival contentions and perused the record. At the outset it may be stated that a very odd procedure, not permissible under law, has been adopted by the State Commission by deciding the appeal against the petitioner, who was not even the party to the complaint from which the appeal has originated. The procedure adopted by the State Commission in our considered view is wrong and amounts to violation of principle of natural justice because by adopting this procedure the State Commission has prevented the petitioner from contesting the allegations in the complaint and producing the evidence in support of its contention. Otherwise also, the blank form referred to by learned counsel for respondent No.1 in absence of the original master policy purportedly issued by the petitioner company in favour of G.E. Country Consumer Financial Services Pvt. Ltd. cannot be taken as proof to establish that any insurance cover under the master policy was extended by the petitioner company to the card holder, namely, the late husband of respondent No.1.

[10] In view of the discussion above, impugned order suffers from material irregularity, as such it cannot be sustained. For proper adjudication of the consumer dispute raised by the complainant it is necessary that complainant may be permitted to amend the complaint by impleading the petitioner as also SBI Life Insurance Co. Ltd. as opposite parties alongwith the finance company.

[11] We accordingly, allow the revision petition, set aside the impugned order and remand the matter back to the District Forum with the direction that District Forum shall take amended complaint on record and thereafter decide the consumer complaint on merits after giving opportunity to the opposite parties to file written statement and lead evidence in support of their case.

[12] Revision petition is disposed of accordingly.