#Consumer Law

The West Bengal Consumer Commission ruled that Section 157 of the Motor Vehicles Act governs only third-party risk insurance, so insurers cannot deny own-damage payouts on the basis of a transfer of policy. This limits insurers’ ability to invoke Section 157 to reject claims for damage to the insured vehicle itself, affecting vehicle owners seeking compensation for their own losses.

The commission ordered the hotel to refund the consumer’s Rs 16.12 lakh advance, plus interest, compensation and costs, because the promised postponement could not override the contract’s cancellation clause. This ruling reinforces that any advance must be returned when the agreed service is not performed, safeguarding consumers in hotel and event bookings.

Insurers may not rely on informal security measures not written into the policy to deny coverage, and a corporate entity is recognised as a consumer under the Consumer Protection Act. The commission awarded the claimant Rs 44.53 lakh with interest and costs. This ruling mandates that policy exclusions be expressly documented and extends consumer protections to corporate borrowers.

The West Bengal State Consumer Disputes Redressal Commission ruled that an electrophysiological study (EPS) is an invasive procedure and therefore falls outside the policy’s diagnostic exclusion clause. It ordered the insurer to pay the cashless claim of Rs 49,119, plus Rs 50,000 compensation and Rs 5,000 costs, signalling that insurers must honour coverage for such invasive diagnostics.

The West Bengal State Consumer Disputes Redressal Commission held that a guarantor need not be joined in a consumer complaint when the relief sought does not affect the guarantor’s rights. This narrows the necessary-party doctrine in banking disputes, allowing borrowers to pursue claims under the Consumer Protection Act, 2019 without compulsory guarantor joinder.

A Delhi consumer commission ruled that a bank’s unilateral increase of loan interest above the RBI-prescribed base-rate, without informing the borrower, amounts to deficiency in service and an unfair trade practice. The bank must revert the rate, refund excess interest and pay compensation, safeguarding borrowers from arbitrary rate hikes.

The West Bengal State Consumer Disputes Redressal Commission held that a self-employed individual who financed a vehicle qualifies as a consumer under the CPA 1986, and that repossessing the vehicle without notice breaches service obligations. It awarded Rs 16.76 million in compensation, extending consumer protection to self-employed borrowers and making unlawful repossession actionable.

The NCDRC ruled that taking advance payments for a non-existent real estate project, while repeatedly acknowledging liability through emails, amounts to deficiency in service under the Consumer Protection Act. A refund of ₹48 lakh with 9% interest is mandated, rejecting the builder’s attempt to disguise payments as voluntary donations. This sets a critical precedent for senior citizens and investors duped by phantom projects.

The West Bengal State Consumer Commission ruled that an insurer cannot repudiate a claim merely for a policy breach (invalid driving licence) unless it directly caused the loss. The Commission awarded 75% of the insured declared value with 7% interest, setting a precedent for non-standard settlements where breach and loss lack proximate causation.