2020 (2) TMI 1725 - SC - Indian Laws

SC Upholds State Commission's Decree, Validates Interest Claim for Delayed Insurance Payment, Appeal Allowed.

The SC concluded that the State Commission's decree must be fully implemented, setting aside the NCDRC's order. The appellant's claim for interest on the ... Claim for damages - loss of stock in trade comprising of raw materials including Mustard Oil Seed, Mustard Oil in tanks and its by-products - damaged during the super cyclone which hit the appellant's business premises on 29th October, 1999 - HELD THAT:- When any party approaches the appellate forum and obtains conditional order of stay, the deposit made is only to prevent the remaining amount being paid. If the appeal is lost, the whole amount becomes due as per of order/decree of the court below. In the present case the National Commission dismissed the appeal and thus observed that the amount had to be paid as per the order of the State Commission. Interim orders to protect the respondent in the interregnum period during the pendency of appeal certainly cannot affect the decree which arises out of the order of the State Commission though, naturally, the amount released to the appellant as a condition of stay would be adjusted against the amount due. The effect of the order of the National Commission was to reiterate the order of the State Commission which had directed payment of Rs.16,00,000/- by 31st March, 2008, failing, interest @ 9% from 1st November, 1999 would be chargeable. The amount was not deposited within that window, nor even interim order obtained, though soon after that the interim order was obtained. That would not make any difference. The order/decree of the State Commission must be implemented in its entirety and thus the view taken by the State Commission in execution proceedings vide order dated 30th October 2015 is the correct view and consequently the impugned order of the National Consumers Redressal Commission is liable to be set aside. Appeal allowed. Issues:Claim for damages due to loss of stock in trade following a natural disaster, interpretation of orders by State and National Consumer Disputes Redressal Commissions, payment of awarded amount by Insurance Company, dispute over interest amount, implementation of State Commission's decree.Analysis:The judgment involves a dispute where the appellant claimed damages for the loss of stock in trade, including raw materials and products, due to a super cyclone in 1999. The claim was initially filed before the State Consumer Disputes Redressal Commission, which awarded a lump sum amount of Rs.16,00,000 in 2007, after eight years of the incident. The Insurance Company appealed to the National Consumer Disputes Redressal Commission, which upheld the State Commission's order to pay the awarded amount within three months.The respondent Insurance Company claimed to have paid the amount within the stipulated time frame, initially Rs.8,00,000 and the balance later. However, the appellant was not satisfied and filed for execution proceedings, seeking interest on the balance amount. The State Commission directed the payment of the balance interest amount, but the National Commission, in a revision petition, observed that the claim for interest was not justified.The Supreme Court, in its judgment, disagreed with the National Commission's view. It emphasized that when an appellate forum issues a conditional stay order, the deposit made is to prevent the remaining amount from being paid. The Court clarified that the whole amount becomes due if the appeal is lost, as per the order or decree of the lower court. In this case, the National Commission's order reiterated the State Commission's directive to pay Rs.16,00,000 by a certain date, failing which interest would be chargeable. Since the amount was not deposited within the specified window, the Court held that obtaining an interim order later did not alter the obligation to pay the awarded amount.The Supreme Court concluded that the State Commission's decree must be implemented in its entirety, setting aside the National Commission's order. The appeal was allowed, with each party bearing its own costs.