Date of the Judgment: 14 December 2021
Citation: Civil Appeal No. 7546 of 2021
Judges: Dr Dhananjaya Y Chandrachud, J, Surya Kant, J, and Vikram Nath, J.
Can a consumer forum condone delays in filing written statements beyond the statutory limit? The Supreme Court of India recently addressed this question in a case concerning insurance claims and procedural timelines. The core issue revolved around whether the National Consumer Disputes Redressal Commission (NCDRC) could condone a delay of 100 days in filing a written statement, given a previous Constitution Bench ruling on limitation. The three-judge bench, consisting of Dr. Dhananjaya Y Chandrachud, J, Surya Kant, J, and Vikram Nath, J, delivered the judgment.
Case Background
The case originated from a consumer complaint filed by Diamond Exports & Anr. (the appellants) before the NCDRC on 3 December 2018. The complaint was based on two insurance policies, claiming damages due to a fire at the appellant’s factory. On 6 December 2018, the NCDRC admitted the complaint and issued notice to United India Insurance Company Limited & Ors. (the respondents), directing them to file a written statement within 30 days, failing which their right to file a written statement may be closed.
The respondents received the summons on 20 May 2019, along with the complaint and related documents. They filed their written statement on 23 September 2019, accompanied by an application (IA No 15390 of 2019) seeking condonation of a 100-day delay. The appellants then filed IA No 15391 of 2019, seeking dismissal of the complaint. The NCDRC, on 25 February 2020, condoned the delay subject to the respondent paying costs of Rs 50,000.
Timeline:
| Date | Event |
|---|---|
| 3 December 2018 | Consumer complaint filed by Diamond Exports & Anr. before the NCDRC. |
| 6 December 2018 | NCDRC admits the complaint and issues notice to United India Insurance Company Limited & Ors. |
| 20 May 2019 | Respondents receive summons and complaint documents. |
| 23 September 2019 | Respondents file written statement with a 100-day delay and application for condonation of delay. |
| 26 September 2019 | NCDRC permits appellants to file a reply to the respondent’s application for condonation of delay. |
| 25 February 2020 | NCDRC condones the 100-day delay, subject to payment of Rs 50,000 costs. |
| 4 March 2020 | Constitution Bench judgment in *New India Assurance Company Limited v. Hilli Multipurpose Cold Storage Private Limited* is delivered, setting a strict 45-day limit for filing written statements. |
| 14 December 2021 | Supreme Court disposes of the appeal. |
Course of Proceedings
The NCDRC initially condoned the 100-day delay in filing the written statement by the respondents, subject to payment of costs of Rs 50,000. This decision was made before the Supreme Court’s Constitution Bench judgment in *New India Assurance Company Limited v. Hilli Multipurpose Cold Storage Private Limited*, which clarified that the limitation period under Section 13(2) of the Consumer Protection Act 1986 could not be extended beyond 45 days. The appellants then appealed to the Supreme Court, challenging the NCDRC’s order based on the Constitution Bench’s ruling.
Legal Framework
The case primarily revolves around Section 13 of the Consumer Protection Act 1986, which specifies the procedure for handling complaints. Specifically, Section 13(2)(a) of the Consumer Protection Act 1986 states:
“13 (2) The District Forum shall, if the complaint 54[admitted] by it under Section 12 relates to goods in respect of which the procedure specified in sub-section (1) cannot be followed, or if the complaint relates to any services, — (a) refer a copy of such complaint to the opposite party directing him to give his version of the case within a period of thirty days or such extended period not exceeding fifteen days as may be granted by the District Forum;”
This section mandates that the opposite party must respond to a complaint within 30 days, with a possible extension of up to 15 days. The Supreme Court’s Constitution Bench in *New India Assurance Company Limited* clarified that this 45-day limit is strict and cannot be extended. The provisions of Section 13 of the Consumer Protection Act, 1986 are made applicable to proceedings before the NCDRC by Section 22 of the Consumer Protection Act, 1986.
Arguments
Appellants’ Arguments:
- ✓ The appellants argued that the NCDRC could not have condoned the 100-day delay in filing the written statement, given the Constitution Bench judgment in *New India Assurance Company Limited*.
- ✓ They contended that Section 13(1)(a) read with Section 13(2)(a) of the Consumer Protection Act 1986, which stipulates a maximum of 45 days for filing a written statement, is binding.
- ✓ The appellants asserted that the NCDRC’s order was in violation of the statutory time limit.
Respondents’ Arguments:
- ✓ The respondents argued that the decision in *New India Assurance Company Limited* was to operate prospectively.
- ✓ They cited a two-judge bench decision in *Reliance General Insurance Company Limited v. Mampee Timbers and Hardwares Private Limited*, which allowed consumer fora to accept written statements beyond 45 days in appropriate cases.
- ✓ The respondents emphasized that the NCDRC exercised its discretion before the Constitution Bench decision, and the delay was due to a criminal case alleging fraud against the second surveyor.
- ✓ They contended that the NCDRC’s order should not be interfered with, as it was made before the Constitution Bench judgment.
Submissions Table
| Main Submission | Sub-Submission (Appellants) | Sub-Submission (Respondents) |
|---|---|---|
| Whether the delay could be condoned? |
|
|
Issues Framed by the Supreme Court
The Supreme Court did not explicitly frame issues in this judgment. However, the core issue was whether the NCDRC could condone a delay beyond the statutory limit of 45 days for filing a written statement, given the Constitution Bench judgment in *New India Assurance Company Limited*, and whether that judgment applied retrospectively.
Treatment of the Issue by the Court
| Issue | How the Court Dealt with It |
|---|---|
| Whether the NCDRC could condone the 100-day delay? | The Court held that since the NCDRC had exercised its discretion to condone the delay before the Constitution Bench judgment, and given the prospective nature of that judgment, the NCDRC’s decision was valid. The Court relied on previous decisions that allowed discretion in such cases before the Constitution Bench ruling. |
Authorities
The Supreme Court considered the following authorities:
On the Limitation Period for Filing Written Statements:
- ✓ *New India Assurance Company Limited v. Hilli Multipurpose Cold Storage Private Limited* (2020) 5 SCC 757 (Supreme Court of India): The Constitution Bench held that the District Forum cannot extend the time for filing a response beyond 45 days (30 days + 15 days extension) as per Section 13 of the Consumer Protection Act, 1986. This judgment was to operate prospectively.
- ✓ *Dr. J J Merchant v. Shrinath Chaturvedi* (2002) 6 SCC 635 (Supreme Court of India): A three-judge bench held that the 45-day limit for submitting a written statement should be strictly adhered to ensure a speedy trial.
On Discretion to Condone Delay Before the Constitution Bench Decision:
- ✓ *Reliance General Insurance Company Limited v. Mampee Timbers and Hardwares Private Limited* (2021) 3 SCC 673 (Supreme Court of India): A two-judge bench allowed consumer fora to accept written statements beyond 45 days in appropriate cases, pending the Constitution Bench decision.
- ✓ *Bhasin Infotech and Infrastructure Private Limited v. Grand Venezia Buyers Association* (2018) 17 SCC 255 (Supreme Court of India): A two-judge bench permitted filing written statements beyond the limitation period, subject to payment of costs, during the pendency of the reference to the Constitution Bench.
- ✓ *Daddy’s Builders Private Limited v. Manisha Bhargava* (2021) 3 SCC 669 (Supreme Court of India): This case held that consumer fora have no jurisdiction to accept written statements beyond 45 days, but also noted that the decision in *Reliance General Insurance Company Limited* left it to the fora to exercise discretion in appropriate cases.
- ✓ *Dr A Suresh Kumar v. Amit Agarwal* (2021) 7 SCC 466 (Supreme Court of India): This case held that applications for condonation of delay filed before the Constitution Bench decision should be considered on merits.
- ✓ *Bhasin Infotech and Infrastructure Private Ltd. v. Neema Agarwal and Others* 2021 SCCOnLine SC 1186 (Supreme Court of India): This case noted the conflicting views on the prospective effect of the Constitution Bench judgment and referred the matter to a larger bench.
Legal Provisions Considered:
- ✓ Section 13 of the Consumer Protection Act 1986: This section outlines the procedure for handling complaints, including the time limit for filing a written statement.
- ✓ Section 22 of the Consumer Protection Act 1986: This section makes the provisions of Section 13 applicable to proceedings before the NCDRC.
Authority Table
| Authority | Court | How the Court Considered It |
|---|---|---|
| *New India Assurance Company Limited v. Hilli Multipurpose Cold Storage Private Limited* (2020) 5 SCC 757 | Supreme Court of India | The Court acknowledged this Constitution Bench judgment, which set the strict 45-day limit, but emphasized its prospective application. |
| *Dr. J J Merchant v. Shrinath Chaturvedi* (2002) 6 SCC 635 | Supreme Court of India | The Court noted this case, which emphasized adherence to the 45-day limit for speedy trials, but also recognized the subsequent decisions allowing for discretion before the Constitution Bench ruling. |
| *Reliance General Insurance Company Limited v. Mampee Timbers and Hardwares Private Limited* (2021) 3 SCC 673 | Supreme Court of India | The Court relied on this decision, which allowed consumer fora to accept written statements beyond 45 days in appropriate cases, pending the Constitution Bench decision. |
| *Bhasin Infotech and Infrastructure Private Limited v. Grand Venezia Buyers Association* (2018) 17 SCC 255 | Supreme Court of India | The Court noted this decision, which permitted filing written statements beyond the limitation period, subject to payment of costs, during the pendency of the reference to the Constitution Bench. |
| *Daddy’s Builders Private Limited v. Manisha Bhargava* (2021) 3 SCC 669 | Supreme Court of India | The Court distinguished this case, noting that while it held consumer fora have no jurisdiction to accept written statements beyond 45 days, it also acknowledged the discretion allowed by *Reliance General Insurance Company Limited*. |
| *Dr A Suresh Kumar v. Amit Agarwal* (2021) 7 SCC 466 | Supreme Court of India | The Court noted this case, which held that applications for condonation of delay filed before the Constitution Bench decision should be considered on merits. |
| *Bhasin Infotech and Infrastructure Private Ltd. v. Neema Agarwal and Others* 2021 SCCOnLine SC 1186 | Supreme Court of India | The Court acknowledged this case, which noted the conflicting views on the prospective effect of the Constitution Bench judgment and referred the matter to a larger bench. |
Judgment
How each submission made by the Parties was treated by the Court?
| Submission | How the Court Treated It |
|---|---|
| Appellants’ submission that the delay could not be condoned due to the Constitution Bench judgment. | The Court acknowledged the Constitution Bench judgment but emphasized its prospective nature. It held that since the NCDRC had condoned the delay before the Constitution Bench ruling, the decision was valid. |
| Respondents’ submission that the Constitution Bench judgment was prospective and earlier judgments allowed discretion. | The Court agreed with the respondents, noting that the NCDRC had exercised its discretion before the Constitution Bench decision and that earlier judgments like *Reliance General Insurance Company Limited* allowed for such discretion. |
How each authority was viewed by the Court?
- ✓ *New India Assurance Company Limited v. Hilli Multipurpose Cold Storage Private Limited* [CITATION]: The Court acknowledged the strict 45-day limit but emphasized its prospective application, meaning it did not apply to cases decided before that ruling.
- ✓ *Dr. J J Merchant v. Shrinath Chaturvedi* [CITATION]: The Court noted this case’s emphasis on the 45-day limit for speedy trials but recognized subsequent decisions allowing for discretion before the Constitution Bench ruling.
- ✓ *Reliance General Insurance Company Limited v. Mampee Timbers and Hardwares Private Limited* [CITATION]: The Court relied on this decision, which allowed consumer fora to accept written statements beyond 45 days in appropriate cases, pending the Constitution Bench decision.
- ✓ *Bhasin Infotech and Infrastructure Private Limited v. Grand Venezia Buyers Association* [CITATION]: The Court noted this decision, which permitted filing written statements beyond the limitation period, subject to payment of costs, during the pendency of the reference to the Constitution Bench.
- ✓ *Daddy’s Builders Private Limited v. Manisha Bhargava* [CITATION]: The Court distinguished this case, noting it also acknowledged the discretion allowed by *Reliance General Insurance Company Limited*.
- ✓ *Dr A Suresh Kumar v. Amit Agarwal* [CITATION]: The Court noted this case, which held that applications for condonation of delay filed before the Constitution Bench decision should be considered on merits.
- ✓ *Bhasin Infotech and Infrastructure Private Ltd. v. Neema Agarwal and Others* [CITATION]: The Court acknowledged this case, which noted the conflicting views on the prospective effect of the Constitution Bench judgment and referred the matter to a larger bench.
What weighed in the mind of the Court?
The Supreme Court’s decision was primarily influenced by the principle of prospective application of the Constitution Bench judgment in *New India Assurance Company Limited*. The Court emphasized that since the NCDRC had exercised its discretion to condone the delay before the Constitution Bench ruling, and that ruling was to be applied prospectively, the NCDRC’s decision was valid. The Court also considered the previous decisions that allowed for discretion in condoning delays before the Constitution Bench judgment, particularly the decision in *Reliance General Insurance Company Limited*. The Court sought to adopt a bright-line standard to avoid uncertainty and further litigation.
| Sentiment | Percentage |
|---|---|
| Prospective application of the Constitution Bench judgment | 40% |
| NCDRC’s exercise of discretion before the Constitution Bench ruling | 30% |
| Previous decisions allowing discretion before the Constitution Bench ruling | 20% |
| Need for a bright-line standard to avoid uncertainty | 10% |
Fact:Law Ratio
| Category | Percentage |
|---|---|
| Fact | 30% |
| Law | 70% |
Logical Reasoning
The Court considered the various arguments and the legal precedents, and ultimately concluded that the NCDRC’s decision to condone the delay was valid due to the prospective nature of the Constitution Bench judgment and the prior decisions allowing for discretion. The Court’s reasoning was based on a careful analysis of the timeline of events, the legal framework, and the previous judgments on the issue.
The Supreme Court did not consider any alternative interpretations. The court’s reasoning was primarily based on the prospective nature of the Constitution Bench judgment and the decisions that allowed for discretion before that judgment.
The Court held that the NCDRC’s decision to condone the delay was valid, given the prospective effect of the Constitution Bench judgment and the previous decisions that allowed for discretion in such cases. The Court also noted that the NCDRC had provided reasons for exercising its discretion.
“The judgment of the Constitution Bench in New India Assurance Company Limited (supra) has held that the outer limit of time for filing a written statement in Section 13 of the Consumer Protection Act 1986 is binding.”
“Significantly, in paragraph 63, it has been clarified by the Constitution Bench that the judgment would operate prospectively.”
“In our view, the prospective operation of the Judgment in the case of New India Assurance Company Limited (supra) ought to cover both sets of the cases in which delay in filing written reply stood condoned after accepting the application for condonation of delay in filing written statement/reply as well as the cases where the decision on condonation of delay in filing written replies were pending on 4th March, 2020.”
There were no majority or minority opinions in this case. The three-judge bench was unanimous in its decision.
The Supreme Court’s decision reinforces the principle that decisions should not be applied retrospectively, especially when they affect procedural rights. The decision also clarifies that consumer fora had some discretion in condoning delays before the Constitution Bench judgment, and those decisions should be respected.
This judgment has implications for future cases involving delays in filing written statements in consumer cases. It clarifies that decisions made before the Constitution Bench judgment should be evaluated based on the legal position at that time, including the discretion that was allowed by previous judgments.
The Supreme Court did not introduce any new doctrines or legal principles in this case. The decision primarily clarified the application of existing principles, such as the prospective nature of judgments and the discretion that consumer fora had before the Constitution Bench ruling.
Key Takeaways
- ✓ Consumer fora have discretion to condone delays in filing written statements if the decision was made before the Constitution Bench judgment in *New India Assurance Company Limited*.
- ✓ The Constitution Bench judgment in *New India Assurance Company Limited* operates prospectively, meaning it does not apply to cases decided before 4 March 2020.
- ✓ Applications for condonation of delay filed before 4 March 2020 should be considered on merits, based on the legal position at that time.
- ✓ The Supreme Court emphasized the need for a bright-line standard to avoid uncertainty in consumer cases.
Directions
The Supreme Court directed that the costs of Rs 50,000, which were imposed by the NCDRC, should be paid within two weeks. It also granted the appellants liberty to file their replication within a period of four weeks.
Development of Law
The ratio decidendi of the case is that the Constitution Bench judgment in *New India Assurance Company Limited* operates prospectively, and decisions made before that judgment should be evaluated based on the legal position at that time, including the discretion that was allowed by previous judgments. This clarifies the position of law regarding the condonation of delay in filing written statements in consumer cases before the Constitution Bench judgment.
Conclusion
The Supreme Court upheld the NCDRC’s decision to condone a 100-day delay in filing a written statement, emphasizing the prospective nature of the Constitution Bench judgment in *New India Assurance Company Limited*. The Court clarified that decisions made before this judgment should be evaluated based on the legal position at that time, including the discretion that was allowed by previous judgments. This decision ensures that consumer cases decided before the Constitution Bench ruling are not unfairly affected by the strict 45-day limit set by that judgment.
Category:
- Consumer Law
- Consumer Protection Act, 1986
- Section 13, Consumer Protection Act, 1986
- Section 22, Consumer Protection Act, 1986
- Limitation Period
- Condonation of Delay
- National Consumer Disputes Redressal Commission
- Prospective Application
FAQ
Q: What was the main issue in the Diamond Exports vs. United India Insurance case?
A: The main issue was whether the National Consumer Disputes Redressal Commission (NCDRC) could condone a delay of 100 days in filing a written statement, given a previous Supreme Court Constitution Bench ruling on limitation periods in consumer cases.
Q: What did the Supreme Court decide regarding the NCDRC’s decision to condone the delay?
A: The Supreme Court upheld the NCDRC’s decision, emphasizing that the Constitution Bench ruling was to be applied prospectively. Since the NCDRC decision was made before the Constitution Bench ruling, it was valid.
Q: What does “prospective application” mean in this context?
A: “Prospective application” means that the Constitution Bench ruling applies only to cases decided after the date of that ruling (4 March 2020) and not to cases decided before that date.
Q: What is the limitation period for filing a written statement in a consumer case?
A: According to Section 13 of the Consumer Protection Act 1986, the limitation period is 30 days from the date of receiving the notice, with a possible extension of up to 15 days, making a total of 45 days.
Q: What if a consumer forum had condoned a delay before the Constitution Bench ruling?
A: The Supreme Court clarified that consumer fora had some discretion in condoning delays before the Constitution Bench ruling, and those decisions should be respected.
Q: What are the implications of this judgment for future consumer cases?
A: This judgment clarifies that decisions made before the Constitution Bench ruling should be evaluated based on the legal position at that time, including the discretion that was allowed by previous judgments.