Scribd
Upload
311 views

Case Study

1. This case study discusses 3 cases related to insurance claims and deficiency of service. 2. In the first case, the Supreme Court ruled in favor of the appellant and directed the insurance company to pay 75% of the insured amount along with interest for an incident where the appellant's truck was stolen after he stopped to give a passenger a lift. 3. In the second case, the National Commission ruled in favor of the insured and ordered the insurance company to pay the claimed amount for damage caused by heavy rain, rejecting the company's arguments. 4. In the third case, the Supreme Court ruled that a private company is a "person" under the law and can file a complaint for deficiency in

Uploaded by

Salman Shaikh
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
311 views

Case Study

1. This case study discusses 3 cases related to insurance claims and deficiency of service. 2. In the first case, the Supreme Court ruled in favor of the appellant and directed the insurance company to pay 75% of the insured amount along with interest for an incident where the appellant's truck was stolen after he stopped to give a passenger a lift. 3. In the second case, the National Commission ruled in favor of the insured and ordered the insurance company to pay the claimed amount for damage caused by heavy rain, rejecting the company's arguments. 4. In the third case, the Supreme Court ruled that a private company is a "person" under the law and can file a complaint for deficiency in

Uploaded by

Salman Shaikh
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
You are on page 1/ 4

CASE STUDY

CASE .1
1. Manjeet Singh Vs. National Insurance Company Ltd. & Anr: In this case, the appellant
had purchased a second - hand truck under a Hire Purchase agreement. The vehicle was insured
by the respondent insurance company. One day when he was driving the truck, a passenger asked
him to stop the truck and give him a lift. When he stopped the truck, the passenger brutally
assaulted the driver and fled with the vehicle. An FIR was lodged and the respondent finance
company was intimated about the theft. However, the insurance company rejected the claim on
the ground of breach of terms of the policy. The complainant approached District Consumer
Disputes Forum, State Commission and National Commission to compensate him for the loss.
All of them had rejected the case. So, finally he approached the Supreme Court.

Judgment: The Supreme Court held that the appellant was not at all in fault. It can be
considered as a breach of the policy, but not a fundamental breach to bring the insurance policy
to an end and terminate the insurance policy. The two - judge bench of Supreme Court directed
the respondent insurance company to pay 75% of the insured amount along with 9% interest p.a.
from the date of filing the claim. The court also directed the insurance company to pay sum of
Rs. 1, 00, 000 as compensation.
CASE .2
2.  National Insurance Company Ltd. vs. Hindustan Safety Glass Works Ltd. & Anr.

In this case, the insurance company had refused to compensate the respondent because of
damage caused due to heavy rain during a mentioned period. The Insurance Company admittedly
denied relief to the insured on the basis of one of the conditions of the policy which stated that
National Insurance would not be liable for any loss or damage 12 months after the event of the
loss or damage to the insured.  The insured filed a complaint with the National Commission
under the provisions of the Consumer Protection Act, 1986.

Judgment: The National Commission held that the claim made by the insured is actionable. It
also observed that the goods were insured at the time of incident and he asked for the claim next
day. It rejected all the contentions urged by National Insurance and ordered the insurance
company to award an amount of Rs. 21, 05,803.89 with interest at 9% per annum.
CASE .3
3. Karnataka Power Transmission Corporation (KPTC) Vs. Ashok Iron Works Private
Limited

Ashok Iron Works, a private company which manufactures iron had applied for obtaining
electricity from the state’s power generation company - the Karnataka Power Transmission
Corporation (hereinafter KTPC) for commencing its iron production. Inspite of paying charges
and obtaining confirmation for the supply of 1500 KVA energy in February 1991, the actual
supply did not begin until ten months later, in November 1991.  This delay incurred a huge loss
for Ashok Iron Works. This company had filed a complaint to the Belgaum Consumer Dispute
Forum and later Karnataka High Court. The legal argument by KTPC was that the complaint was
not maintainable as the consumer Protection Act 1986 excludes commercial supply of goods. It
also made an argument that the company in engaged in manufacturing iron and intended to use it
for commercial consumption which is excluded under the Act.  He also said that, the
complainant is not a `person’ under Section 2(1)(m) of the Act, 1986.

Judgment: In this case, Supreme Court gave his rulings. The Supreme Court mentioned the
General Clause Act that includes a private company within the purview of the definition of a
“Person.” It was also held that the supply of electricity by the KPTC to a consumer would be
covered under Section 2(1)(o) being ‘service.’ Also, if the electrical energy consumer is not
provided to a consumer in time as is agreed upon, then under Section (2)(1)(g), then there can be
a case for deficiency in service. Therefore, the clause stating “supply” of goods for commercial
purpose would not be applied. The Supreme Court sent this case back to District Forum for
retrial on these grounds. 

You might also like