Karnataka State Consumer Commission Refuses To Interfere With Order Condoning 7-Year Delay In Insurance Claim

The Commission held that the reasons furnished by the complainant— including proceedings before the Permanent Lok Adalat and the impact of the COVID-19 pandemic — were “just and proper” and warranted adjudication of the dispute on merits.

Facts Of The Case

The dispute pertains to an own-damage insurance claim relating to a Ford Figo car bearing registration No. KA-27-M-4761, owned by the complainant, Kavita, a government servant. The vehicle was insured with SBI General Insurance Company Ltd. during the relevant period.

Following damage to the vehicle, the complainant lodged a claim with the insurer. As the claim was not settled, the matter was referred to the Permanent Lok Adalat in 2016. The dispute, however, remained unresolved, and by an order dated 1 September 2018, the Permanent Lok Adalat permitted withdrawal of the proceedings with liberty to approach the appropriate forum.

Thereafter, in June 2024, the complainant approached the District Consumer Disputes Redressal Commission, Belgaum, along with an application seeking condonation of delay. The District Commission allowed the application on 14 June 2024 and admitted the complaint.

Aggrieved by the said order, the insurance company approached the State Commission by way of the present appeal.

Contention Of The Opposite Parties

The insurance company contended that the District Commission had mechanically condoned an inordinate delay of 7 years and 28 days without assigning cogent reasons. It was argued that Section 69 of the Consumer Protection Act prescribes a limitation period of two years from the date of accrual of cause of action, which had been ignored.

It was further submitted that the District Commission neither examined whether sufficient cause existed for such condonation nor recorded reasons justifying the departure from the statutory limitation, rendering the order liable to be set aside.

Observations And Decision of the State Commission

The State Commission perused the order sheet, pleadings, and the affidavit filed in support of the application for condonation of delay. It noted that the complainant had earlier pursued remedies before the Permanent Lok Adalat, which had expressly granted liberty to approach the appropriate forum.

The Commission observed that the sworn affidavit filed by the complainant disclosed valid reasons for the delay, including the relaxation of limitation during the COVID-19 pandemic. It found no false or misleading statement regarding the delay in instituting the complaint.

Significantly, the Commission noted that the insurance company had failed to satisfactorily explain why the own-damage claim was neither settled nor formally repudiated.

Holding that the District Commission had rightly accepted the reasons assigned in the affidavit, the State Commission concluded that the delay stood validly condoned and that the dispute required adjudication on merits.

Accordingly, the appeal was dismissed, and the District Consumer Commission was directed to proceed with the complaint expeditiously, after affording both parties an opportunity to adduce evidence and documents.

Case Title: SBI General Insurance Company Ltd. v. Kavita
Case No.: Appeal No. 2838/2024

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