The Supreme Court in a road accident case of 2014 that took place in Nepal has directed the New India Assurance Co. Ltd. to reimburse the medical expenditure incurred by the insured for the treatment of the injured husband and deceased wife.

The Court allowed an Appeal challenging the impugned order of the National Consumer Disputes Redressal Commission (NCDRC), whereby the plea for reimbursement of medical expenses was rejected.

The Court noted that the reading of the order of the District Consumer Disputes Redressal Forum (DCDRF) shows that the claims as per the terms and conditions incorporated in the insurance policy had to be released if found admissible and to the extent of the insured's entitlement. Therefore, it was natural for the Appellate to assume that the claim would include medical expenses incurred by him in a vehicle accident.

The two-judge Bench of Justice B. V. Nagarathna andJustice Ujjal Bhuyan asserted, “We do not think that is a correct reading of the Order of the District Forum inasmuch as the District Forum had specifically referred to medical bills at Exhibits C-19 to C28 and had directed the insurance company to release the amount found admissible to the complainant-appellant. The appellant herein was naturally under the impression that the amounts covered under the medical bills would also be payable”.

Advocate Ritesh Khatri appeared for the Appellant and Advocate ​​Rameshwar Prasad Goyal appeared for the Respondents.

The Respondent insured the Appellant's vehicle, which was initially covered in India and later in Nepal. The vehicle met with an accident and the Appellant claimed to have paid various amounts, including medical expenses and compensation, to the affected parties. The Respondent refused to pay the claimed amount, so the Appellant filed a complaint with the DCDRF. The DCDRF ruled in favour of the Appellant, but the Respondent appealed to the State Consumer Disputes Redressal Commission (SCDRF). The SCDRF dismissed the appeal. The Respondent then filed a revision petition with the National Consumer Disputes Redressal Commission (NCDRC). The NCDRC upheld the previous rulings but did not award medical expenses.

The Court noted that the main issue pertains to the reimbursement of medical expenses incurred by the Appellant. The Bench observed that the contention of the Respondent, that there was no evidence to show that the Appellate incurred the medical expenses, was incorrect.

“In this regard, our attention was also drawn to the copies of the said Exhibits by way of filing an application for filing additional documents. Learned counsel for the respondent-insurer did not dispute the fact that the evidence in the form of Exhibits C-19 to C-28 were on record…. Learned counsel for the insurance company has not disputed these documents, instead, the contention of the insurer before the NCDRC was that “there is no evidence on record” to show that the payment was made. This is not a correct submission or statement made on behalf of the insurer”, the Bench observed.

The Court asserted that the NCDRC erred in its order to disallow the reimbursement of medical expenses on the basis of the arguments presented by the Respondent. The Bench noted, “However, the NCDRC, on the basis of the submission of the learned counsel for the insurer, disallowed the disbursement of the medical bills on the premise that there was no evidence on record and that the appellant herein had not contested the Order of the District Forum before the State Commission”.

Accordingly, the Apex Court allowed the Appeal and set aside the impugned order of the NCDRC, while directing the concerned authorities to release the said amount to the Appellant within a period of one month from the date of the judgment.

Cause Title: Hem Raj v. The New India Assurance Co. Ltd. (2023 INSC 644)

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