A.P. Sahi, President

This complaint which is an original petition has been filed complaining deficiency in service on the part of the Insurance Company by not indemnifying the full claim as covered under the policy and for not making the payment of interest for the delay in respect of the payments that were made by it against the claim.

2. The petitioner- company is in the business of Plastic Moulded furniture under the name and style of "Regal" that was established way back in 1997-98. One of its factories was insured with the United India Insurance Company Limited, the opposite party no. 1 herein and the manufacturing plant unfortunately was engulfed in a fire that broke on 02.12.1999. The same resulted in a total loss and accordingly the complainant dispatched a letter intimating about the said incident to the Insurance Company. There is no dispute about the fire having taken place or the loss suffered. The survey was carried out and a survey report was tendered. The Insurance Company on being satisfied with the loss initially released a sum of Rs.5,20,00,000/- on 10.04.2000 as a part release of the amount as against the total coverage of Rs. 11,60,00,000/-. There were three policies in all and that the interim payment was made subject to final survey reports being tendered.

3. The procedure thereafter followed and other averments in the complaint being not relevant to the controversy are not being narrated, but the fact remains that with the part payment, the complainant felt aggrieved and requested the Insurance Company to finalise the claim with a request to the surveyor to tender his final report. The policy was on a reinstatement basis, but from the facts on record it remains undisputed that in spite of the release of an adhoc payment of Rs.5,20,00,000/- on 10.04.2000, the complainant- company did not restore the activities of the manufacturing unit. The complainants claim delay on the part of the surveyor as well as the Insurance Company, but at the same time, the communication on record dated 04.04.2001, indicates that the complainants themselves had intimated that they were not in a position to replace the machines as they had no hope for getting any further financial assistance from any corner.

4. The surveyor submitted the report and the Insurance Company proceeded to finalise the claim between 21.04.2003 and 24.04.2003, whereby the payments were computed and a sum of Rs.5,16,91,955/- was received by the complainant in addition to the amount already released on adhoc basis as noted above. Simultaneously the complainant also signed the discharge vouchers.

5. It is long thereafter that the complainants raised their demand on 02.01.2004 for an additional amount of Rs.6,58,73,605/-. It was urged through the said letter that the complainants were entitled to receive Rs. 11,42,58,616/- as against the total sum insured of Rs. 11,60,00,000/. However they described the payments received by them on 10.04.2000 and 21/24.04.2003 as part payments to the tune of Rs.10,36,91,955/-. It was therefore urged by the complainants that they were still entitled to receive the balance of Rs. 1,05,66,661/- and over and above they claimed interest payable from 31.12.2003 onwards to the tune of Rs.5,53,06,944/- which amounted to an additional claim of Rs.6,58,73,605/-.

6. The complainant in the letter alleged that as they had made several representations and the payment received was only adhoc, no reason was given as to the payment of the reduced amount and the same had been done without any notice or opportunity. In paragraph 8 of the said letter the allegation was that when the company had raised the issue of payment of interest they had been threatened that the company would be barred from raising any future claims.

7. This letter was followed by a reminder on 21.01.2004 and having failed to get any response the present complaint was filed on 31.03.2004. The reliefs prayed for in the complaint are as follows:

                   i) "That the Hon'ble Commission may be pleased to direct the Respondent to pay interest at the rate of 18% p.a. on the adhoc payment already made by them from the date of incident of fire till date of payment and further the interest lost on the interest amount not paid till that date.

                   ii) The Hon'ble Commission may further direct the Respondents to pay the balance principal amount of Rs.1,05,66,661/- and also 18% p.a. interest from the date of occurrence of fire or after two months thereafter till the date of payment.

                   iii)Any other relief in the facts and circumstances of the case."

8. Mr. Madhurendra Kumar learned counsel for the complainant has urged that the discharge vouchers had been signed under duress and compulsion and therefore there was no full and final settlement. He submits that the protest was raised, but the Insurance Company had failed to fully indemnify the claim.

9. Mr. Amit Kumar Singh, learned counsel for the Insurance Company has urged that once the discharge voucher has been signed without any protest, the complainant cannot claim any further payments and for that he submits that there is no proof of any undue influence, duress, or coercion either pleaded or established as against the discharge voucher signed which was voluntary, hence in the absence of any such material the entire claim is unfounded. Reference has been made to the decisions of the Apex Court in the case of Aimer Singh Cotton & General Mills & Ors. vs. United India Insurance (1999) 6 SCC 400, National Insurance Company Ltd. Vs. M/s. Boghara Polyfab Private Limited, AIR 2009 SC 170 (2009) Vol. 1 SCC Page 267 and the latest decision is in the case of Oriental Insurance Co. Ltd. & Anr. Vs. Dicitex Furnishing Ltd. (2020) 4 SCC 621, These decisions have been considered by this Commission in the case of Patanjali Foods Ltd, v. Oriental Insurance Co. Ltd., 2024 SCC OnLine NCDRC 205. The SLP filed against the same has been dismissed by the Apex Court vide order dated 10.07.2024 in Civil Appeal Diary No. 7975/2024, Patanjali Food Limited Vs. The Oriental Insurance Company Limited. He further submits that there was no resistance or protest at all and in the absence of any such evidence the contentions raised is unfounded and the complaint deserves to be dismissed.

10. On the other hand, Mr. Madhurendra Kumar, learned counsel for the complainant urged that the signing of the discharge voucher did not absolve the liability of the Insurance Company that had delayed the payments in spite of having settled the claim and there was no reason to deduct the amount about which details were given in the letter dated 02.01.2004 referred to hereinabove. He therefore submits that on both counts there was deficiency on the part of the Insurance Company and hence the deficit amount as well as the interest claimed is payable. He has taken us through the numerous documents and communications to urge that the Insurance Company was time and again prompted and reminded of the shortfalls in the payment as well as the interest which was a clear protest raised on behalf of the complainants.

11. Before entering into anything further we may point out that the law laid down on this subject is clear that if there is an allegation of any threat, coercion or undue influence, the same has to be proved by evidence in order to construe that the act of signing of a discharge voucher may or may not be voluntary. In the instant case we have not been able to gather any pleadings or evidence so as to establish that the discharge vouchers which were signed and the payments received were under threat or coercion. The Admitted position is that the Insurance Company upon the incident being reported immediately released a sum of Rs.5,20,00,000/-, and inspite of this release, the complainant-company could not reinstate itself and to the contrary wrote a letter in April, 2001 that it was unable to restore the unit and therefore the claim should be settled. This period which was spent by the complainants in intimating the Insurance Company therefore cannot be in our opinion treated to be any delay on the part of the Insurance Company that had undertaken all steps to facilitate the reinstatement and proceed further. Nonetheless, as noted above there is no convincing or clinching material to establish undue influence or coercion to establish the allegations against the Insurance Company to arrive at the conclusion that the discharge vouchers had been signed by the complainants and the payments received out of any Such threat or coercion.

12. There is one more relevant aspect which needs to be considered and that is the letter of protest that emanated on 02.01.2004, which is almost after 10 months after having signed the discharge voucher in April, 2003. This gap therefore is yet another indicator of the absence of any protest in between. Mr. Madhurendra Kumar has time and again emphasized on the facts stated in paragraph 56 of the Complaint and its sub paras to urge that the claim had been made, but from the said averments we do not find any such protest having been raised prior to 02.01.2004. The letter dated 02.01.2004 also does not contain any such material supported by any evidence to demonstrate that the complainants had raised any protest in writing or otherwise before the Insurance Company. To the contrary, the discharge vouchers signed and the payments received have not been denied that are on record.

13. The contention of Mr. Madhurendra Kumar that the payment was short by Rs. 1,05,66,661/- therefore cannot be a claim to be entertained in the background above, when the discharge voucher indicates about the final settlement of the amount. We are therefore not convinced with the submissions raised by Mr. Madhurenra Kumar and the pleadings on record which do not surpass the tests laid down by the Apex Court and this Commission in the decisions referred to hereinabove. Consequently, having failed to cross the legal threshold as enumerated in the decisions mentioned above, the contention is therefore unfounded and the claim for balance of the principal amount deserves rejection and is accordingly rejected.

14. As a consequence thereof any claim of interest on the said balance of the principal amount also cannot be granted and is therefore declined.

15. The next question is about the delay in the payments up to the time of the settlement and the release of the amount in April, 2003.

16. On this aspect, we find that the surveyor report had been tendered on 07.02.2002, after the complainants had already expressed their inability for reinstatement of the factory and run it once again. The surveyor has therefore taken some time in proceeding to submit his report when the complainants had already indicated this way back in April, 2001. Mr. Amit Kumar Singh, learned counsel for the Insurance Company is correct that some time therefore had to be taken and was actually consumed in order to collect and collate documents by the Insurance Company for assessing the loss. This computation and calculation therefore according to him was made and the survey report was tendered on 07.02.2002. This as argued was not on account of any delay on the part of the Insurance Company, but because of the stand of the complainants themselves in not being able to reinstate the unit.

17. In this regard what we find is that the surveyor report having been tendered on 07.02.2002, the payment was delayed for almost one year and was made on 21/24.04.2003, which is evident from a perusal of the discharge vouchers. Accordingly, this delay in the payment remains unexplained appropriately by the Insurance Company, in as much as, the loss had already been computed and the Insurance Company had already made the advance payment of Rs.5,20,00,000/- in the year 2000 itself. The complainants had indicated their inability to reinstate the unit in April, 2001. It is therefore obvious that the computation ought to have been made speedily and the same came to be finalised by the surveyor through report dated 07.02.2002.

18. Mr. Amit Kumar Singh, learned counsel for the Insurance Company urged that the Complainants themselves in their rejoinder have stated that the calculations made by the surveyor deserve to be accepted. Once this is established that the surveyors report was made the basis for making the payments to the complainant's and the complainants have also admitted this position in the rejoinder affidavit then we do not find any reason for the Insurance Company to have delayed the payments till April, 2003. The period therefore with effect from the date of the submission of the surveyor's report which has been accepted by the Insurance Company up to the date of actual payment in April, 2003 would invite interest, in as much as, this delay in payment on the part of the Insurance Company in our opinion amounts to deficiency. Thus, the payment of Rs.5,16,91,955/- that was made on 21/24.04.2003, ought to have been paid immediately on the tendering of the report of the surveyor as it is stood admitted by the Insurance Company itself. The interest therefore will have to be calculated and would become payable to the complainants, not to the extent as claimed by them, but by awarding 6% simple interest with effect from 07.02.2002 to 21.04.2003. This payment shall be made to the complainants as it is by now well settled that interest if denied would amount to injustice as held by the Apex Court LIC of India and Anr. versus S. Sindhu reported in 12006) 5 SCC 258 the provisions of the Interest Act, 1978. Following the aforesaid principle this Commission in the case of Soni Singh & Ors. Vs. M/s. Iffco Tokio General Insurance Co. Ltd., FA/958/2023 decided on 29.08.2025, in paragraphs 12 to 16 has observed as under:

                   "12. We may point out that award of interest in consumer complaints of different varieties has been upheld and the Apex Court has gone to the extent of observing that failure to award interest, when there is a delay in payment, results in injustice and therefore interest should be awarded in all cases subject to of course the discretion to be exercised in these matters depending upon the facts of each case. This matter was considered by the Apex Court in the case of LIC of India and Anr. versus S, Sindhu reported in (2006) 5 SCC 258 the provisions of the Interest Act 1978, where in Paragraph No. 12 to 15 it was observed as under:

                   "12. Where a statute provides for payment of interest, such interest will have to be paid in accordance with the provisions of such statute. Admittedly there is no enactment, or rules made under any enactment, either relating to contracts in general or insurance in particular, which provides for payment of interest in regard to the amount payable under such a policy.

                   13. Let us now consider the provisions of the Interest Act, 1978 ("the Act" for short) which deals with payment of interest up to the date of suit/daim. The Act was enacted to consolidate and amend the law relating to the allowance of interest in certain cases. The objects and reasons state that the Act was enacted to prescribe the general law of interest in a comprehensive and precise manner, which becomes applicable in the absence of any contractual or statutory provision specifically dealing with interest. Subsection (1) of Section 3 of the Act provides that in any proceedings for the recovery of any debt or damages, or in any proceedings in which a claim for interest in respect of any debt or damages already paid is made, the court may, if it thinks fit, allow interest to the person entitled to the debt or damages or to the person making such claim, as the case may be, at a rate not exceeding the current rate of interest, for the whole or part of the following period, that is to say-

                   if the proceedings relate to a debt payable by virtue of a written instrument at a certain time, then, from the date when the debt is payable to the date of institution of the proceedings;

                   if the proceedings do not relate to any such debt, then, from the date mentioned in that regard in a written notice given by the person entitled or the person making the claim to the person liable that interest will be claimed, to the date of institution of the proceedings.

                   14. Sub-section (3) of Section 3 makes it dear that nothing in Section 3 shall apply in relation to any debt or damages upon which interest is payable as of right, by virtue of any agreement, or any debt or damages upon which payment of interest is barred, by virtue of an express agreement. Clause (a) of Section 2 of the Act defines "court" as including a tribunal and an arbitrator; clause (c) of Section 2 defines "debt" as any liability for an ascertained sum of money and includes a debt payable in kind but does not include a judgment debt; and clause (b) defines "current rate of interest". Sub-section (1) of Section 4 of the Act provides that notwithstanding anything contained in Section 3, interest shall be payable in all cases in which it is payable by virtue of any enactment or other rule of law or usage having the force of law. Sub-section (2) of Section 4 provides that notwithstanding what is stated in Section 3 or Section 4(1) of the Act, in the cases of money deposited as security for performance of an obligation, interest is payable from the date of deposit; and in the case of money payable by virtue of a fiduciary relationship, money/property obtained/retained by fraud and money due as dower/maintenance, interest is payable from the date of cause of action. A claim for interest on the amounts of premium paid, from the respective dates of payment of premium to date of settlement of claim, does not find support from any of the provisions of the Act.

                   15. Even assuming that interest can be awarded on grounds of equity, it can be awarded only on the reduced sum to be quantified and paid from the date when it becomes due under the policy (that is on the date of death of the assured) and not from any earlier date. We do not propose to examine the question as to whether interest can be awarded at all, on equitable grounds, in view of the enactment of the Interest Act, 1978 making a significant departure from the old Interest Act (32 of 1839). The present Act does not contain the following provision contained in the proviso to Section 1 of the old Act: "interest shall be payable in all cases in which it is now payable by law". How far the decisions of this Court in Satinder Singh v. Amrao Singh [(1961) 3 SCR 676 : AIR 1961 SC 908] and Hirachand Kothari v. State of Rajasthan [1985 Supp SCC 17] and the decision of the Privy Council in Bengal Nagpur Rly. Co. Ltd. v. Ruttanji Ramji [(1937-38) 65IA 66: AIR 1938 PC 67] holding that interest can be awarded on equitable grounds, all rendered with reference to the said proviso to Section 1 of the old Interest Act (Act of 1839), will be useful to interpret the provisions of the new Act (Act of 1978) may require detailed examination in. an appropriate case."

                   13. Learned counsel for the appellant has also relied on the decision of the Apex Court in the case of Alok Shanker Pandey Vs. Union of India & Ors., (2007) 3 SCC 545, and prays for award of 12% interest.

                   14. We may point out that in insurance matters the IRDA Regulations regarding Protection of Policy Holders Interest, 2002 provides for payment of interest in case of delay beyond the stipulated 45 days after the settlement of the claim with the rate of interest payable @ 2% above the bank rate.

                   15. In matters of medical negligence the Apex Court in the case of Balram Prasad versus Kunal Saha reported in (2014) 1 SCC 384, observed that a rate of 6% would be reasonable and the observation made in paragraph 131 of the said decision is extracted herein under:

                   "131. Therefore, the National Commission in not awarding interest on the compensation amount from the date of filing of the original complaint up to the date of payment of entire compensation by the appellant doctors and AMRI Hospital to the claimant is most unreasonable and the same is opposed to the provision of the Interest Act, 1978.

                   Therefore, we are awarding the interest on the compensation that is determined by this Court in the appeal filed by the claimant at the rate of 6% per annum on the compensation awarded in these appeals from the date of complaint till the date of payment of compensation the compensation awarded in these appeals from the date of complaint till the date of payment of compensation awarded by this Court. The justification made by the learned Senior Counsel on behalf of the appellant doctors and AMRI Hospital in not awarding interest on the compensation awarded by the National Commission is contrary to law laid down by this Court and also the provisions of the Interest Act, 1978. Hence, their submissions cannot be accepted as the same are wholly untenable in law and misplaced. Accordingly, the aforesaid point is answered in favour of the claimant."

                   16. The ratio of the above decisions therefore support the contention of the appellant for award of interest and we therefore accordingly allow this appeal in respect of the claim of interest, but we however, in the facts and circumstances of the present case, award interest @ 9% from the date of the submission of the claim i.e., 08.12.2018 till the date the actual payment made by the insurance company to the complainants/ appellants. "

19. Accordingly following the ratio above and the facts as noted, the complaint is partly allowed to the limited extent of 6% interest to be paid to the complainant calculated on the amount of Rs.5,16,91,955/-for the period from 07.02.2002 to 21.04.2003 within three months or else the interest would stand enhanced to 9%.

20. The complaint stands disposed off with the above directions.