State Consumer Disputes Redressal Commission
National Insurance Company Ltd vs Smt. Pushpa Devi on 24 January, 2012
STATE CONSUMER DISPUTES REDRESSAL COMMISSION, PUNJAB,
DAKSHIN MARG, SECTOR 37-A, CHANDIGARH.
Revision Petition No.40 of 2010
Date of institution : 20.5.2010
Date of decision : 24 .1.2012
National Insurance Company Ltd., having its Regional Office at SCO No.332-334,
Sector 34-A, Chandigarh through Shri J.S. Kalra, Manager duly constituted
attorney.
.......Petitioners
Versus
Smt. Pushpa Devi w/o Late Mohan Lal Goyal, near Masand Chowk, Jalandhar city
(since deceased) through her LRs.
1. Shri Jeevan Kumar Goyal s/o Late Mohan Lal Goyal, r/o House No.96, 8-
Jawahar Nagar, Moga.
2. Suresh Kumar Goyal, House No.2, Kishanpura Mohalla, Moga.
3. Naresh Kumar Goyal, House No.1224, Ward No.11, 8-Jawahar Nagar,
Moga.
......Respondents
Revision Petition against the order dated 15.5.2009
of the District Consumer Disputes Redressal
Forum, Jalandhar.
Before :-
Hon'ble Mr. Justice S.N. Aggarwal President.
Mr. B.S. Sekhon, Member.
Present :-
For the petitioners : Shri P.S. Saini, Advocate with Shri Parminder Singh, Advocate.
For respondents No.1&3 : Ex parte.
For respondent No.2 : Shri Varun Chawla, Advocate for Shri K.C. Malhotra, Advocate.
JUSTICE S.N. AGGARWAL, PRESIDENT:
Smt. Pushpa Devi (now deceased) (represented by her legal representatives) had filed a complaint against the petitioners (Complaint No.380-DF-2004) in which she had claimed the insurance claim for the accidental death of her husband Revision Petition No.40 of 2010. 2 Mohan Lal Goyal. The complaint was contested by the petitioners. It was accepted by the learned District Forum vide order dated 9.6.2006. The operative part of this order reads as under:-
"Therefore, we allow the complaint. The opposite parties are directed to pay the insurance amount with 9% interest from the three months after from the date of submission of the claim till payment and that interest would serve as compensation. We also award Rs.2,000/- as costs of the litigation. Compliance of the order be made within one month from the copy of receipt of this order. Copies of the order be sent to the parties free of costs, under rules. File be consigned to the record room."
2. This order has become final.
3. In the meantime Smt. Pushpa Devi also died and her LRs filed an execution application. The petitioners had taken the plea that an amount of Rs.4,82,273/- has been disbursed to the complainant in compliance with the order of the Hon'ble State Commission. The JDs had deducted an amount of Rs.25,000/- which was deposited by them at the time of filing of the appeal. Besides that Rs.15,532/- were deducted as the said amount was deposited as TDS with the Income Tax authorities in accordance with the provisions of the Income Tax Act.
4. Learned District Forum vide impugned order dated 15.5.2009 directed the petitioners to refund the amount in totality because the interest was awarded only towards compensation.
5. Hence the petition by the Insurance Company.
6. The submission of the learned counsel for the petitioners was that it was essential for them to deduct the TDS on the interest amount under the statutory provisions and it was deducted in accordance with law. Hence it was prayed that the petition be accepted and the impugned order dated 15.5.2009 be set aside. Revision Petition No.40 of 2010. 3
7. On the other hand, the submission of the learned counsel for the respondent was that since the amount of interest was in lieu of compensation, therefore, the deduction of TDS by the petitioners was illegal. Hence it was prayed that the petition be dismissed.
8. Record has been perused. Submissions have been considered.
9. Learned counsel for the respondent relied upon the order dated 29.4.2011 passed by this Commission in Revision Petition No.73 of 2010 "National Insurance Company Ltd. v. Balwant Singh" and on the judgment of Hon'ble National Commission dated 18.9.2002 passed in Revision Petition No.2244 of 1999 "G.D.A. v. Dr. N.K. Gupta".
10. Similar controversy had arisen before this Commission in Balwant Singh's case (supra) and it was held in the judgment dated 29.4.2011 that the petitioners were not entitled to deduct the income tax at source as the amount of interest was in lieu of compensation. It was observed in para 14 and 15 as under:-
"14. It appears that the Hon'ble Supreme Court had laid the principle of interest also. Therefore this judgment was not to be treated as a precedent for any other matter on that account. But so far as the non-payment of TDS out of the interest amount is concerned, the Hon'ble Supreme Court was also pleased to observe in subsequent judgment reported as "HARYANA URBAN DEVELOPMENT AUTHORITY v. RAJ MEHTA" I(2005) CPJ 16 (SC) in which it was held that the interest is awarded to the complainant in lieu of compensation and, therefore, the amount of interest was not subject to deducting the income tax at source. It was held towards the end of para 7 of this judgment as under:-
'Also as stated in so many matters appellants cannot deduct TDS as these Revision Petition No.40 of 2010. 4 are payments towards compensation/damages for mental agony and harassment and escalation in costs of construction.'
15. In view of the facts of this case and the law discussed above, it is held that the petitioners were not entitled to deduct the income tax at source and, therefore, the petitioners are directed to remit the amount of Rs.13,197/- to the respondent."
11. Therefore we find no merit in the present petition and the same is dismissed.
12. The petitioners are directed to pay this amount to the respondent. However the petitioners would be at liberty to seek refund of that amount from the Income Tax authorities.
13. So far as the amount of Rs.25,000/- deposited in the State Commission by the appellants at the time of filing of appeal is concerned, it be released to the respondent, if not already released.
14. The arguments in this case were heard on 17.1.2012 and the order was reserved. Now, the order be communicated to the parties.
15. The petition could not be decided within the statutory period due to heavy pendency of court cases.
(JUSTICE S.N. AGGARWAL)
PRESIDENT
January 24 , 2012 (BALDEV SINGH SEKHON)
Bansal MEMBER
Revision Petition No.40 of 2010. 5