The State Consumer Disputes Redressal Commission in Chandigarh directed the insurer to compensate a city couple for fire damage they sustained over two decades ago. Mrs. Prem Vashisht and Mr. VK Vashisht faced issues with the insurance company after a fire broke out in their coal storage unit in February 2003. After the judgment, both of them will get Rs.1.36 crore plus other interests and damages.
A Long Road to Justice:
In 2003, the Vashishts faced a big problem when their coal store got burnt down. They had insured it against this sort of thing happening with the New India Assurance Company Limited. Nevertheless, the company refused to pay them without giving any reason.
Undeterred, the couple began a protracted legal struggle. They submitted concerns with the Consumer Commission in 2003, but their case was rejected for technical reasons. The Consumer Protection Act of 1986 defines who qualifies as a “consumer.” The initial consumer commission rulings did not consider the Vashishts to be consumers under the act’s definition.
Embracing lower perplexity and higher burstiness, the National Consumer Disputes Redressal Commission once again rejected their appeal, after which they went to the Supreme Court of India. When the case was ruled in August 2023, the Supreme Court felt that they had a point; because of this, it was cited as a precedent setter. Consequently, the Supreme Court set aside its previous verdict and directed the State Commission to revisit the contentious matter.
Compensation Awarded:
When the Supreme Court got involved, the State Consumer Disputes Redressal Commission evaluated the matter and found the Vashishts were not guilty, after hearing the petition made by both parties. It also recognized that the insurance company had done poor service by ignoring their genuine demand without any valid reason.
As a result, the commission ordered New India Assurance Company Limited to pay Rs 1.36 crore, the original claim amount, to the couple. Additionally, the company will have to pay interest on the claim amount at a rate of 9% per annum, calculated from August 20, 2003. The commission also awarded a compensation of Rs 2 lakh and Rs 35,000 each to Prem Vashisht and VK Vashisht respectively for the mental agony and harassment caused by the prolonged legal battle.
Significance of the Judgement:
This judgment holds significance for several reasons. It highlights the importance of fighting for one’s rights, even when faced with initial setbacks. The couple’s perseverance over two decades ultimately led to a just outcome.
The case also emphasizes the role of the Consumer Protection Act in safeguarding consumer interests. In this case, the Supreme Court’s decision broadens the term for “consumer”, hence expanding the scope of the act and providing even greater protection to businesses. Lastly, it underscores the point that insurers should strictly adhere to their contracts and act honestly when settling claims.
