M/S. The Oriental Insurance Co. ... vs Union Of India
2023 Latest Caselaw 2500 Tel

         HONOURABLE SRI JUSTICE P.SAM KOSHY
                          AND
     HON'BLE SRI JUSTICE LAXMI NARAYANA ALISHETTY


                 WRIT PETITION NO.14938 OF 2023

ORDER: (per Hon'ble Sri Justice Laxmi Narayana Alishetty)

         The present writ petition has been filed by the petitioner

challenging the order, dated 23.02.2023 passed in CC.No.323 of

2020 by the District Consumer Disputes Redressal Commission-III

(for short "District Commission"), Hyderabad.


2.       Heard learned counsel Ms. A.Anasuya for the petitioner and

Sri Gadi Praveen Kumar, learned Deputy Solicitor General of India

for respondent no.1 and Sri Avinash Desai, learned senior counsel

appearing for Sri TPS Harsha, learned counsel or respondent no.3.

3. The brief facts leading to filing of present petition are as

under:

4. Respondent No.3 is a company engaged in construction of

Ports, Tunnels, Dams and Barrages, Highways, Industrial

Structures, Hydel Power Plants, Thermal Power Plant and related

Civil Engineering Construction activities, having experience of

around 55 years in the field. Respondent No.3 entered into a

Contract Agreement, dated 27.02.2015 with M/s. NHDC Limited, PSK,J & LNA,J WP No.14938 of 2023

for the project works called Modification and Reconstruction of

Energy Dissipation Arrangement (EDA) of main spillway of Indira

Sagar Dam, Narmada Nagar, District Khandwa, M.P. The total

contract value as per the agreement was Rs.159,98,50,707/-. The

respondent No.3/complainant obtained a "Contractors All Risks

Insurance Policy" (CAR) bearing No.431200/44/015/83, for period

of two years, w.e.f. 25.03.2015 to 24.03.2017, for a total insured

sum of Rs.162,73,50,707/- from the writ petitioner herein. The

respondent No.3/complaint paid a gross premium of

Rs.50,19,426/-.

5. The respondent No.3 extended the policy periodically from

time to time, vide Endorsement No.431200/44/2015/83/011,

dated 24.03.2017 for a further period of 12 months from

25.03.2017 to 24.03.2018 by paying premium of Rs.63,16,155/-.

The policy was further extended for a period of three more months

from 25.03.2018 to 24.06.2018 by paying premium of

Rs.31,08,120/-. The policy was further extended for a period of one

month from 25.06.2018 to 24.07.2018 by paying premium of

Rs.11,68,529/-.

6. During the period from 05.08.2016 to 14.08.2016, there was

heavy discharge of flooding of water through main spillway gates of

the project, causing damage to the project. Due to heavy rainfall in PSK,J & LNA,J WP No.14938 of 2023

Madhya Pradesh, particularly in the catchment area of Narmada

River, the flood gates of Indira Sagar Dam were re-opened on

22.08.2016 and the same were closed on 01.09.2016. The

respondent No.3 has observed that consequent upon release of

flood water, there was huge damage to partially completed EDA

works. Therefore, the respondent No.3 company on 06.09.2016

forwarded email, dated 03.09.2016 received from the Indira Sagar

work site to the petitioner with request to depute a surveyor to

assess the loss.

7. The respondent No.3 estimated the loss at

Rs.16,00,00,000/- and requested the petitioner herein to release

50% of the estimated loss towards "On Account Payment" for

enabling them to commence repair works. The petitioner appointed

a surveyor 08.09.2016 and a preliminary report was submitted by

the surveyor on 19.09.2016. The complainant/respondent No.3

submitted claim form on 30.03.2017 estimating loss at

Rs.16,85,64,022/-. The Surveyor submitted final report on

07.01.2019. On 04.09.2019, the petitioner/insurance company

repudiated the claim of respondent No.3/complainant on the

ground that claimant had not complied with section 64VB of

Insurance Act and violated General Conditions No.1,5 and 8 of

CAR Policy and also breach of utmost good faith.

PSK,J & LNA,J WP No.14938 of 2023

8. The respondent No.3 filed a consumer case i.e. CC.No.323 of

2020 on 26.09.2020 before the District Consumer Disputes

Redressal Commission-III, Hyderabad against the petitioner on

26.09.2020 under Section 34(1) of the Consumer Protection Act,

2019 claiming sum of Rs. 8,53,08,762/- along with interest @18%

per annum from 22.08.2016 till its realization along with

compensation of Rs.50 lakhs and cost of Rs.10 lakhs. The

petitioner herein filed written version on 18.01.2021.

9. Subsequently, the petitioner herein filed Interim Application

i.e., IA No.99/2021on 30.11.2021 raised an objection with regard

to pecuniary jurisdiction of District Commission, on the ground

that the total premium paid by respondent No.3 herein was

Rs.1,05,92,804/- and whereas, the District Commission has

jurisdiction at that point of time to entertain consumer case was

up to Rs.1 Crore only. However, the District Commission vide order

dated 30.11.2021 dismissed the Interim Application on the ground

that plea of lack of pecuniary jurisdiction was not taken by

petitioner in the written version. The petitioner filed another

application IA No.245/2022 on 29.09.2022 seeking permission to

amend the written version and the said application was allowed by

the District Commission on the same day.

PSK,J & LNA,J WP No.14938 of 2023

10. The District Commission vide order dated 23.02.2023

allowed the consumer case directing the writ petitioner herein to

pay Rs.8,53,08,762/- along with interest @ 6% per annum from

04.09.2019 and also compensation of Rs.1 lakh and costs of

Rs.25,000/-. Thereafter, the writ petitioner herein has filed Review

Application vide I.A. No.1 of 2023 on 18.04.2023, however, the said

application was dismissed by the District Commission on the

ground that scope of review is limited to typographical errors and

clerical mistakes and it has no power to revise its own orders.

11. The respondent No.3 filed counter affidavit primarily taking

objections with regard to maintainability to writ petition in the light

of there being remedy of statutory appeal prescribed under

Consumer Protection Act. It is further contended that as per

Section 41 of the Consumer Protection Act, the petitioner is liable

to deposit 50% of the ordered amount while preferring the appeal.

The writ petitioner ought to have invoked statutory appeal

available under Consumer Protection Act against the impugned

order. The writ petition is filed only to avoid the same and

therefore, the writ petition is bad and liable to be rejected.

12. In support of its contention, the respondent No.3 placed

reliance on a judgment of Division Bench of this Court, dated

03.08.2021 passed in writ petition No.20141 of wherein, the PSK,J & LNA,J WP No.14938 of 2023

Division Bench relying upon on the judgment of the Hon'ble Apex

Court in Special Appeal to Leave (C) No.4127 of 2021 in Mehra Bal

Chikitsava Evan Navjat Shishu I.C.U vs Manoj Upadhyay &

Others, and also judgment of Hon'ble Apex court in Cicily

Kallarackal vs. Vehicle Factory 1, in somewhat similar issue held

that writ petition is not maintainable.

13. The respondent No.3 further contended that the claim

pertains to period from the year 2015 to 2017 and the insurance

premium amount paid for that period was only Rs.50,19,426/-

which is within the pecuniary limit of District Commission under

Section 34(1) of the Consumer Protection Act, 2019. The insurance

premium paid for the subsequent extended period is immaterial for

the claim raised by the respondent No.3. Therefore, contention of

writ petitioner that the respondent No.3 ultimately paid insurance

premium more than Rs.1 crore and thus, the District Commission

does not have jurisdiction is incorrect. Therefore, the writ petition

is misconceived and therefore, liable to be dismissed.

Consideration:

14. Without referring to merits of the case and rival factual

contentions, it is appropriate to take-up the preliminary ground of

(2012) 8 SCC 524 PSK,J & LNA,J WP No.14938 of 2023

maintainability of writ petition in light of Section 41 of Consumer

Protection Act, 2019 wherein, against an order of the District

Commissioner a statutory remedy of appeal has been provided.

15. During the course of hearing, learned counsel for the

petitioner reiterated the factual aspects contended in the writ

petition and further contended that writ petition is maintainable

against an order which has been passed without jurisdiction. In

support her contention, she placed reliance on the following

judgments:

i. Chief Engineer Hydel Project vs. Ravinder Nath reported in 2008 AIR (SC) 1315.

ii. Godrej Sara Lee Ltd. vs. Excise and Taxation Officer-cum-Asessing Authority reported in 2023 Live Law(SC) 70.

iii. Radha Krishan Industries vs. State of Himachal Pradesh reported in 2021(6) SCC 771.

iv. Harbanslal Sahnia vs. Indian Oil Corporation reported in 2003(2) SCC107.

v. Whirlpool Corporation vs. Registrar of Trade Marks, Mumbai reported in 1999 AIR(SC) 22.

vi. Dr.Jagmittar Sain Bhagat v.Director of Health Services, Haryana repoted in 2013(10)SCC 136.

vii. Alpha G184 Owners Assoication vs. Magnum Internation Trading Company Pvt.Ltd. reported in 2023 AIR(SC) 2527.

PSK,J & LNA,J WP No.14938 of 2023

16. A writ petition is still maintainable even though alternative

remedy is available, when the wit petition is filed for enforcement of

any fundamental rights or whether there has been a violation of

the principle of natural justice or where the order or proceedings

are wholly without jurisdiction or the vires of an Act is challenged

as has been held by the Hon'ble Apex Court in Whirpool

Corporation vs. Registrar of Trade Marks, Mumbai 2.

17. On the other hand, respondent No.3 relied upon the

judgment of Hon'ble Apex Court in Cicily Kallarackal (supra) and

also order of Division Bench of this Court passed in W.P.No.20141

of 2019. It is relevant to note that the judgments relied upon by

respondent No.3 relates to and arising out of Consumer Protection

Act, whereas, the judgment relied upon by the petitioner does not

relate to matters of the Consumer Protection Act and are general in

nature with regard to maintainability of writ petition.

18. It is noteworthy to mention that in the order dated

03.08.2021 in W.P.No.20141 of 2019, the Division Bench of this

Court in similar matter arising out of order of State Consumer

Disputes Redressal Commission relying upon judgment of Hon'ble

Apex Court in Special Appeal to Leave (C).No.4127 of 2021 in

Mehra Bal Chikitsava Evan Navjat Shishu I.C.U (supra), order

1999 AIR (SC) 2022 PSK,J & LNA,J WP No.14938 of 2023

dated 12.03.2021 and in Cicily Kallarakal (supra) held that writ

petition is not maintainable and the Petitioner ought to have

invoked the remedies available under the statute against the

impugned order.

19. Further, lack of inherent jurisdiction to entertain the case

and lack of pecuniary jurisdiction to entertain the case are two

different aspects. In the present case, there is no dispute with

regard to inherent jurisdiction of District Commission to entertain

the consumer complaint filed by the respondent No.3. However,

principal contention of writ petitioner is with regard to lack of

pecuniary jurisdiction and not that of inherent jurisdiction of

District Commission to entertain the consumer case. Therefore, the

judgments relied upon by the writ petitioner are not applicable to

the facts of the present case, since the same are on the point of

lack of inherent jurisdiction to adjudicate the matters.

20. Admittedly, the writ petitioner herein filed an application

I.A.No.99 of 2021 in CC.No.323 of 2020 for rejection of consumer

case on the ground of pecuniary jurisdiction and the said

application was dismissed by the District Commission vide order

dated 30.11.2021. The Petitioner did not take further steps to

challenge the said order and thus, the issue has become final and

binding on petitioner. Therefore, filing of writ petition on the very PSK,J & LNA,J WP No.14938 of 2023

same ground of lack of pecuniary jurisdiction is not maintainable

in the light of availability of remedy of statutory appeal under

Section 41 of Consumer Protection Act, 2019.

Conclusion:

21. Given the aforesaid admitted factual matrix narrated in the

preceding paragraphs, especially, availability of remedy of statutory

appeal under Section 41 of Consumer Protection Act, 2019, we are

of the considered view that the petitioner ought to have invoked

remedies available under the statute against the impugned order

passed by the District Commission. Therefore, writ petition is not

maintainable and accordingly, writ petition is dismissed, leaving it

open to the petitioner to avail the remedies available under statute.

There shall be no order as to costs.

Pending miscellaneous applications, if any, shall stand

closed.

__________________________________ P.SAM KOSHY, J

__________________________________ LAXMI NARAYANA ALISHETTY, J Date: 20 .09.2023 ktm PSK,J & LNA,J WP No.14938 of 2023

HONOURABLE SRI JUSTICE P.SAM KOSHY AND HON'BLE SRI JUSTICE LAXMI NARAYANA ALISHETTY

WRIT PETITION NO.14938 OF 2023

Date: 20.09.2023

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