SAVANI ROADLINESversusSUNDARAM TEXTILES LTD. AND ANR.

                            SA VANI ROADLINES                                      A
                                        v.
                 SUNDARAM TEXTILES LTD. AND ANR.

                                JULY 13, 2001

             [S. RAJENDRA BABU AND S.N. VARIAVA, JJ.]                              B

       Consumer Protection Act, /986-S.2(b) and (d)

       Consumer-Subrogation-Carrier-Non-delivery of goods-Loss ofi
 goods settled by Insurance Company-Insurance Company obtaining letter C
 of subrogation from consignor-Complaint by Insurance Company against
 carrier-Allowed-Validity of-Held, letter of subrogation was an
 assignment-Assignee not a beneficiary of the service and was not a
 Consumer-Thus, complaint by Insurance Company, not maintainable-
 However, it is open to the Insurance Company to file claim for recovery in D
 a Civil Court.

       Respondent No. 1 consigned certain goods to appellant for transportation.
 The said goods were not delivered. Respondent no. 1 claimed loss of goods
 from respondent no. 2-lnsurance Company. The Insurance Company settled
 the claim and obtained "Letter of Subrogation, and a Special Power ofi            E
 Attorney". Thereafter, on the basis of said letter respondent no. 2-Insurance
 Company filed a claim against appellant-Carrier before the State Consumer
 Redressal Forum, which was allowed. Appellant unsuccessfully filed a Revision
 before the National Consumer Commission. Hence the present appeal. ·

        The issue in the present appeal was whether respondent No. 2-              F
 Insurance Company was a Consumer viz-a-viz the appellant and as such can
 file a complaint before the Consumer Forum.

       Allowing the appeal, the Court

         HELD : Respondent no. 2-Insurance Company is not entitled to maintain     G
  a complaint against appellant before the Consumer Forum. The main terms
  of the letter of Subrogation are in effect assignment only and since the
  assignee was not a beneficiary of the service, it was not a consumer. However;
. it will be open for the Insurance Company to file a claim for recovery of the
  amount of a Civil Court. [982-H; 983-H; 984-A]
                                      981
                                                                                   H'
    '982                      SUPREME COURT REPORTS                    (2001) 3 S.C.R.

A        New India Assurance Company Ltd. v. B.N. Sainani, (1997] 6 SCC 383                  .
    and Oberoi Forwarding Agency v. New India Assurance Co. Ltd., (2000f 2               }-'
    sec 407' relied on.

            CIVIL APPELLATE JURISDICTION: Civil Appeal No. 7349 of
    2000.
B
         From the Judgment and Order dated 11.3.1999 of the National Consumers
    Disputes Reddressal Commission, New Delhi ..
                                                                                          ~

         M.N. Krishnamani, Alok Sangwan, Somayjit Pasi, S. Srinivasan and
    V. Sudeer for the Appellant.
c
         Soli J. Sorabjee, Attorney General, A.K. Raina and Anil Kumar Jha for
    the Respondent.

            The Judgment of the Court was delivered by

D        S.N. V ARIAVA, J. This Appeal is against and Order of the National
    Consumer Disputes Redressal Commission dated 11th March, 1999.
                                                         ...
            Briefly stated the facts are as follows:

           The 1st Respondent had entrusted to the Appellant 125 carton of
E   goods, of the value of Rs. 9,30, 188 for transport from Nanguneri to Itchalkaranji
    the goods were not delivered. 'The 1st Respondent had insured the goods
    with the 2nd Respondent. The 1st· Respondent lodged a claim with the 2nd
    Respondent for ·loss of goods. The 2nd Respondent settled the claim of 1st
                              a
    Respondent by paying sum of Rs. 9,30,188. The 2nd Respondent took a
F   letter, which is tenned as a "Letter of Subrogation, and a Special Power of          ~:
    Attorney". On the basis of this letter the 2nd Respondent filed a complaint
    before the State Consumer Redressal Forum. The 1st Respondent was also a
    party to this complaint. The State Consumer Redressal Forufn by its Order
    dated 16th December, 1998 directed the Appellant to pay a sum oflls. 9,30,188
    with interest at 12% per annum.
G                                                                      .
         The Appellant filed a Revision before the National 1 Co~sull?-er Redressal
    Commission which has been dismissed by th~ impugned Order· dated 11th
    March, 1999. Hence this Appeal.                                                      "-
            The only question raised .~efore us is whether an Insurance Company
H is a consumer viz-a-viz the Appellant and as such consumer can file a complaint
          SAVANI ROADLINES v. SUNDARAM TEXTILES LTD. [VARIAY/!'.,J.)            983
    before the Consumer Forum.                                                             A
          In the case of New India Assurance Company Ltd. v. B.N. Sainani,
    reported in [ 1997] 6 SCC 383, this Court has held that assignee of a mere right
    to sue for the loss on account of short landing of goods cannot be regarded
    as any beneficiary of any service within the meaning of the definition
    "Consumer". It has been held that such assignee cannot file a complaint                B
    under the Act, but can file a suit in a Civil Court for recovery of the loss. It
    has been held that the complaint by such assignee would not be maintainable.

           In the case of Oberoi Forwarding Agency v. New India Assurance Co.
    Ltd., reported in [2000] 2 sec 407, it has been held that an insurer compensating 'C
    the consignor for loss of goods during transit and having an assignment was
    not beneficiary of the services hired by the consignor from the carrier. It is
    held that an insurer was not a consumer and could not, therefore, maintain
    a complaint against the carrier of the goods. It is held that even the addition    1




    of the consignor as a co-complainant would not enable the insurer to maintain
    such a complaint. In this Judgment the term of "Letter of Subrogation" (in that D
    case) are also set out. The main terms are, more or less, identical to the terms
    of the "Letter of Subrogation" in the present case. On an interpretation of
    those terms this Court has held that such a "Letter of Subrogation" was in
    effect an assignment. This Court has held that the assignee was not a
    beneficiary of the services and was not a consumer. It is held that a complaint
    by the Insurance Company was not maintainable.                                     E
          Faced with this situation, Mr. Raina submitted that in both cases i.e.
    New India Assurance Co. Ltd. 's case and Oberoi Forwarding Agency.; the .
    decisions were based on the fact that there was an assignment. He submitted
    that if there was no assignment but a mere Subrogation then the principles,
    laid down in these two cases would not apply. He submitted that on F
    suborgation the Insurance Company would merely step into the shoes of the
    consumer and would be filing the complaint on behalf of the consumer. He
    showed to this Court the various terms of the Letter of Subrogation and! ,,
    submitted that, in this case, there was no assignment, but a mere suborgation.
    He submitted that the complaint was thus maintainable.                         G
          In our view, it is not necessary to decided whether a complaint would
j   be maintainable if there was merely subrogation. The main terms of the Letter
    of Subrogation in this case are identical to the Letter of Subrogation in Oberoi
    Forwarding Agency's case. On s.uch terms it has been held that it is an
    assignment. As it is an assignment the principles laid down in the above               H
    984                     SUPREME COURT REPORTS                    (2001] 3 S.C.R.

A mentioned cases apply and the complaint would not be maintainable. We,
    however, clarify that it will be open for the Insurance Company to file a claim
    for recovery of the amounts in a Civil Court.

         Accordingly, the Appeal is allowed. There will, however, be no Order
    as to costs. ·
B
    S.V.K.                                                       Appeal allowed.·