Consumer Forum Cannot Decide Ex Parte Before Expiration Of 45 Days Required To File Written Statement: NCDRC

The Complainant obtained a loan from a bank to purchase a tractor and trolley, which were insured by Cholamandalam General Insurance/insurer. When her husband went to use the tractor, he discovered it had been burnt by unknown persons. An FIR was lodged, and a claim was filed with the insurer for the damages. However, the insurer did not settle the claim. Consequently, the Complainant filed a complaint before the District Forum seeking Rs. 3,00,000 for deficiency in service and Rs. 1,00,000 for mental agony. The District Forum allowed the complaint and directed the insurer to pay the repair amount of Rs. 2,66,743 with 8% interest. The bank was directed to realize the loan amount from the Complainant after deducting the subsidy amount. Both the insurer and the bank were also ordered to pay Rs. 5,000 each to the Complainant as litigation costs. Aggrieved by the District Forum's order, the insurer and the bank appealed to the State Commission of Orissa, which dismissed the complaint. Consequently, the insurer and the bank filed a revision petition before the National Commission.

The insurer was proceeded against ex-parte due to non-appearance. Furthermore, the bank argued that there was no deficiency in service on its part and stated that the complaint should be dismissed with respect to the bank. The bank further contended that it provided the loan to the Complainant according to the terms and conditions of the loan agreement.

The National Commission observed that the main question in this case was whether the District Forum's decision to proceed ex parte against the insurer was appropriate. It was undisputed that they issued and received the notice to the insurer. The prescribed limitation for filing the Written Version is 30 days from the receipt of the notice, with an additional 15 days permissible. The District Forum proceeded ex-parte against the insurer before the expiry of this period, even though the insurer entered an appearance and sought to set aside the ex-parte order within the permissible period. The District Forum did not consider this request and passed a final order. The State Commission also dismissed the insurer's appeal. The Commission referenced the Supreme Court's decision in New India Assurance Company Limited vs. Hilli Multipurpose Cold Storage Private Ltd & Ors. and Diamond Exports & Anr. vs. United India Insurance Company Ltd. & Ors., which clarified that the Consumer Forums cannot condone delays in filing the Written Statement beyond 45 days unless specific conditions are met. The commission highlighted that, in this case, the insurer requested to set aside the ex-parte order and file the written version within the permissible period. Therefore, the District Forum's decision to proceed ex-parte was premature.

The Commission allowed the review petition, dismissed the orders of the State Commission and District Forum, and remanded the matter to the District Forum to allow the insurer to file the Written Version and decide the complaint according to the law.

Case Title: Branch Manager Cholamandalam M. S. General Insurance Company Ltd. Vs. Minati Dei

Case Number: R.P. No. 1947/2019