Repudiating Claim Due to ‘Protest’ Endorsement Unjustified: Thrissur Consumer Commission Slams Oriental Insurance
Pranav B Prem
The District Consumer Disputes Redressal Commission, Thrissur has held the Oriental Insurance Company Ltd. liable for deficiency in service and unfair trade practice after it denied a legitimate insurance claim solely because the policyholder signed the discharge voucher “under protest.” The bench comprising President Sri C.T. Sabu and Members Smt. Sreeja S. and Sri Ram Mohan R. ordered the insurer to compensate the complainant not only for the withheld amount but also for the mental agony and litigation costs arising from a delay of over a decade.
Background of the Case
The complainant, Va Sunny, had insured his commercial vehicle with Oriental Insurance Company under a valid policy. The vehicle met with an accident during the policy period, prompting the complainant to undertake repairs amounting to Rs. 1,64,500. A claim was thereafter lodged with the insurance company. However, the insurer offered to settle the claim at a much lower amount of Rs. 52,500 based on a surveyor’s assessment. The complainant, under financial stress and urgency, accepted the discharge voucher but explicitly added the endorsement “received under protest.”
Contrary to the initial promise, the insurer refused to disburse even the offered Rs. 52,500, citing the complainant's protest note on the discharge voucher as the reason for non-payment. Multiple reminders and a legal notice to the insurer went unanswered, leaving the complainant with no option but to approach the District Commission.
Observations and Findings
The Commission noted that while the complainant did not produce documentary proof to substantiate the full expense of Rs. 1,64,500, that fact alone did not negate the insurer’s admitted offer of Rs. 52,500. The Commission referred to the Supreme Court’s judgment in Kaushal Kishor v. State of Uttar Pradesh to underline that expressing protest is part of an individual’s freedom of expression under Article 19(1)(a) of the Constitution. It held that the complainant was merely preserving his right to dispute the quantum of settlement and that such protest did not invalidate the insurer’s obligation to pay the settled sum.
The Commission found the insurer’s insistence on an unconditional acceptance before releasing payment to be an “unfair trade practice” and a “clear deficiency in service.” Further, the conduct of the insurer during proceedings revealed procedural laxity and deliberate delays. The insurer’s chief witness failed to appear for cross-examination despite multiple adjournments between 2015 and 2023. The Commission applied the principle laid down in Vidhyadhar v. Manikrao [AIR 1999 SC 1441], ruling that evidence of a witness not subject to cross-examination is of no evidentiary value. Consequently, the insurer’s survey report was discarded.
Highlighting the undue delay and harassment caused to the complainant, the Commission referred to the decision in Yerikala Sunkalamma and Anr. v. State of Andhra Pradesh and Ors. to emphasize the duty of public authorities and government entities to act as model litigants. The insurer's refusal to pay based on an arbitrary technicality—despite being aware of its liability—was held to be devoid of merit and legal justification.
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Relief Granted
The Commission allowed the complaint and directed Oriental Insurance Co. Ltd. to:
Pay Rs. 52,500 as reimbursement for the claim,
Pay Rs. 75,000 as compensation for mental agony and financial loss,
Pay Rs. 25,000 towards litigation expenses,
All sums to carry interest at 9% per annum from the date of filing the complaint until actual realization.
The insurer was ordered to comply with the directives within 30 days from the date of receipt of the order.
Appearance
For Complainant: Adv. C.K. Hariharaputhran
For Opposite Party: Adv. C.R. Thomas
Cause Title: V.A. Sunny vs The Oriental Insurance Co. Ltd.
Case No: CC 255/09
Coram: Shri. C. T. Sabu [President], Shri. Ram Mohan R [Memeber], Smt. Sreeja S. [Member]
[Read/Download order]
