Revision Petition Fails: Insured's Compensation Cannot Be Directly Claimed by Financier.


10 December 2024 Civil Revision >> Civil & Consumer Law  

A higher consumer disputes redressal commission has dismissed a revision petition filed by a financing entity seeking to directly receive the insurance claim amount awarded to the complainant, who was the insured party. The case originated in a District Forum where the complainant's claim against an insurance company was initially allowed. This order was partially modified in a subsequent appeal, reducing the claim amount.

The present petitioner, a financing company with whom the insured vehicle was hypothecated, had failed to contest the original complaint before the District Forum despite receiving notice and was proceeded against ex parte. Notably, the petitioner did not file its own appeal against the District Forum's order, nor did it respond to the appeal filed by the insurance company.


 

 

Instead, the petitioner belatedly filed a review application before the State Commission, seeking a modification of the appellate order. The petitioner argued that it had orally requested that the insurance claim amount, deemed admissible, should be paid directly to them due to their hypothecation interest in the vehicle. This review application was dismissed by the State Commission, both due to a significant delay of 95 days and on the merits of the case, citing a relevant Supreme Court precedent.


The higher commission, in dismissing the revision petition, concurred with the State Commission's decision. It emphasized that the core dispute was between the complainant (the insured) and the insurance company regarding the insurance claim. The petitioner, as the hypothecator, was not a party to the insurance agreement and had not been sought any direct relief against by the complainant.

The commission further clarified that even with the vehicle being hypothecated, the petitioner's recourse for recovering its dues lay through appropriate legal channels and not by directly claiming the insurance proceeds payable to the insured party. The commission concluded that the matter did not fall within the purview of a 'consumer' dispute concerning the petitioner in this context.

Consequently, finding no merit in the revision petition, the commission dismissed it without imposing any costs.