Jammu and Kashmir High Court: While deciding the instant appeals which raised objections concerning the jurisdiction of the J&K High Court to hear and decide appeals arising out of the orders passed by the Jammu and Kashmir State Consumer Disputes Redressal Commission, in view of the application of the Jammu and Kashmir Reorganization Act, 2019 which repealed the erstwhile Jammu and Kashmir Consumer Protection Act, 1987; the Division Bench of Ali Mohammad Magrey and Vinod Chatterji Koul, JJ., held that that all the pending proceedings/ appeals arising out of the orders or awards passed by the erstwhile Jammu and Kashmir State Consumer Disputes Redressal Commission will continue to be heard and decided by the High Court as if the un-amended provision/ Act is still in force.
However, the Bench clarified that from now on all the fresh proceedings concerning consumer complaints/ grievances/appeals shall be dealt with as per the mode and method prescribed in the newly changed scheme of law as provided in the Jammu and Kashmir Reorganization Act, 2019.
As per the facts of the case, the complainant owned a residential building which he had insured with both; the National Insurance Company Ltd. and the Oriental Insurance Company Ltd. On 23-09-2002, some terrorists sneaked into his house. In the gun battle that ensued between the terrorists and the security personnel, the insured/complainant’s house was heavily damaged and was eventually razed to the ground in order to eliminate the terrorists. Complainant claims to have approached both the Insurance companies to depute surveyors on the spot. National Insurance Company Ltd. deputed an investigator to the spot, who, after making spot inspection, asked for certain documents from the complainant which were provided; however the complainant received no further information. The Oriental Insurance Company Ltd., however, did not depute any Surveyor to the spot; instead, a communication was addressed by the Company to the complainant informing him that the policy stood terminated from the date of its inception. Therefore, the complainant approached the then Jammu and Kashmir State Consumer Disputes Redressal Commission for relief. As per the Commission’s assessment, the total liability was fixed to Rs. 15 Lakhs which was to be shared by both the Insurance companies. Complainant, being dissatisfied with the said order, has filed the appeal seeking enhancement of compensation in his favour. Hakim Suhail Ishtiaq, appearing on behalf of the complainant, submitted that the Commission, while passing the impugned order, did not appreciate the evidence on record in its true and correct perspective. J. A. Kawoosa, representing the National Insurance Company Ltd., argued that the impugned order passed by the Commission is contrary to law. Whereas N. H. Khuroo, appearing on behalf of the Oriental Insurance Company Ltd., challenged this Court’s jurisdiction to hear and decide these appeals in view of the application of the Jammu and Kashmir Reorganization Act, 2019. Counsels for both the Insurance companies contended that the insured/complainant had effected the insurance without disclosing vital material facts like the occupation of the premises by the terrorists as well as the existence of the simultaneous policy of insurance obtained from the other Insurance Company, thereby violating the principle of ‘uberrima fidei’.
Examining the facts of the case and the contentions raised by the parties, the Court observed that issue pertains to the nature of the disclosure made by the insured/ complainant in the proposal form and its impact on the entire process of invitation and acceptance of the offer. The relationship between an insurer and the insured is recognized as one where mutual obligation of trust and good faith are paramount. The Court upon perusing the evidences noted that the insured did make lapses in revealing certain vital information regarding the premises.
Thus, Bench held that the Commission had erred in properly appreciating the evidence on record, therefore its impugned order granting the compensation of Rs 15 lakhs to the complainant was set aside.[Sajad Ahmad Malik v. Divisional Manager, National Insurance Company Ltd., 2020 SCC OnLine J&K 299 , decided on 22-06-2020]