M/S. Kozyflex Mattresses Private Limited vs. SBI General Insurance Company Limited and Another : Read Full Judgment
The case of M/S. Kozyflex Mattresses Private Limited vs. SBI General Insurance Company Limited and Another revolves around a fire incident at the manufacturing unit of the appellant company and the subsequent insurance claim filed by them. The appellant, engaged in manufacturing coir foam mattresses, pillows, cushions, and other coir by-products, had obtained a fire insurance policy from the respondent insurance company. However, when a massive fire occurred at their manufacturing unit, causing significant damage, the insurer repudiated the claim on grounds of alleged fraud and fabrication of documents.
The appellant claimed a sum of Rs. 3.31 crores for the damage caused by the fire, including losses to building, plant and machinery, and stock. The insurer appointed investigators to verify the authenticity of the claim documents, who reported suspicions of fraudulent transactions related to the purchase of machinery and stock. Consequently, the insurer repudiated the claim, citing Clause 8 of the General Terms and Conditions of the policy, which allows forfeiture of benefits if the claim is found to be fraudulent.
The appellant challenged the repudiation by filing a complaint before the National Consumer Disputes Redressal Commission (NCDRC). The NCDRC, after considering the insurer’s response and investigation reports, upheld the repudiation, prompting the appellant to appeal to the Supreme Court under Section 67 of the Consumer Protection Act, 2019.
The Supreme Court, in its judgment authored by Justice Mehta, addressed two preliminary objections raised by the insurer. First, regarding the appellant’s eligibility as a consumer under the Consumer Protection Act, the Court held that the Act’s amended definition of ‘person’ includes companies, indicating legislative intent to rectify any anomalies. Second, the Court distinguished previous judgments cited by the insurer, emphasizing that the insurance policy in question specifically covered fire and related perils, making the appellant eligible to invoke consumer protection jurisdiction.
The Court then addressed the appellant’s plea regarding the lack of timely access to investigation reports, noting that the appellant had not been given proper opportunity to rebut them. Consequently, the Court set aside the NCDRC’s order and remitted the matter back to the Commission for reconsideration. It directed the appellant to file a rebuttal affidavit limited to the contents of the reports, ensuring a fair hearing on the merits.
In summary, the Supreme Court’s judgment recognized the appellant’s eligibility as a consumer under the amended Consumer Protection Act and addressed procedural shortcomings in the earlier proceedings. By remitting the matter to the NCDRC for fresh consideration, the Court upheld the principles of natural justice, ensuring that the appellant has a fair opportunity to contest the repudiation of their insurance claim.
DISCLAIMER: This interpretation is based on available information and legal understanding, not legal advice. Readers should consult original court documents and legal experts for precise understanding.
