Case: united india insurance co. ltd., Vs. abdul rashid mattoo and others

1. The respondents preferred a complaint before the J&K State Consumer Protection Commission complaining of deficiency in services by the appellant-Insurance Co. The case of the respondents was that their house which was insured with the appellant-Insurance Co. suffered damage on account of earthquake and inspite of the claim having been preferred, the Insurance Co. did not honour the same and kept it pending for an unreasonable length of time. Though the appellant defended itself disputing the entitlement of the respondents to any claim under the insurance policy, however the Commission found the respondents entitled to an award of damages of Rs.2,03,605/- which in the opinion of the Commission was a fair assessment of the damages suffered by the respondents house due to earthquake. The award of this amount of compensation has been upheld by the High Court in appeal. Feeling aggrieved, the Insurance Co. has filed this appeal by special leave. Having heard the learned counsel for the parties, we are satisfied that the findings that there was an earthquake and that the house of the respondents suffered damage to the tune of Rs.2,03,605/- are purely of fact based on evidence and no fault can be found therewith. However, the Commission has awarded a further sum of Rs.50,000/- to the complainant "as compensation for loss and injury, harassment physical and mental torture which he had to suffer due to ill thought action of the functionaries of the Insurance Company". The awarded amount has been directed to carry interest at the rate of 18% p.a. The learned counsel for the appellant has submitted that there was no occasion for awarding this additional sum of Rs.50,000/- and also to award interest at such a high rate. We find merit in both the submissions. Merely because the Insurance Co. resisted the claim made by the respondents and then defended itself, a finding as to physical harassment and mental torture could not have been arrived at and recorded by the Commission.

Decision reasoning: 1[ds]Having heard the learned counsel for the parties, we are satisfied that the findings that there was an earthquake and that the house of the respondents suffered damage to the tune of Rs.2,03,605/are purely of fact based on evidence and no fault can be found therewith. However, the Commission has awarded a further sum of Rs.50,000/to the complainant "as compensation for loss and injury, harassment physical and mental torture which he had to suffer due to ill thought action of the functionaries of the Insurance Company". The awarded amount has been directed to carry interest at the rate of 18% p.a. The learned counsel for the appellant has submitted that there was no occasion for awarding this additional sumand also to award interest at such a high rate. We find merit in both the submissions. Merely because the Insurance Co. resisted the claim made by the respondents and then defended itself, a finding as to physical harassment and mental torture could not have been arrived at and recorded by the Commission.