- (1.) The respondent Company dealt in oil products and for that purpose, it used to purchase vegetable and refined oil from different parts of the country and transported the same in oil tankers. In order to protect itself against losses due to accidents, theft, pilferage, non-delivery etc. , occurring in the course of transit, the respondent took insurance policies with the appellant in january 1988. The first policy was for an insurance cover of Rs 10,10,00,000 which was further increased by Rs 7 crores. Thus the total insurance coverage was for Rs 17.10 crores for which an aggregate premium of rs 4,26,826 was paid by the respondent to the appellant.
(2.) One of the conditions of the contract of insurance was that in respect of the unutilised portion of the coverage, the appellant would refund to the respondent the proportionate amount of premium. That is to say, if the value of the total quantity of oil transported fell short of Rs 17.10 crores during the period of policy, the appellant would refund to the respondent the proportionate premium on the amount of shortfall in the quantity transported.
(3.) It is not disputed that the respondent had transported goods worth rs 9,71,59,990 during the period of the policies. After the expiry of the period of the insurance policies, the respondent requested for refund of the proportionate premium amounting to Rs 2,05,797 but the respondent company paid only a sum of Rs 40,889 through a cheque on the ground that the premium charged by the appellant from the respondent was less than what it ought to have been charged. It was pointed out that the premium was levied only at the rate of 30% whereas it should have been at the rate of 50% in view of the circular dated 7-3-1986. It was in these circumstances that the respondent approached the National Consumer Disputes Redressal commission (for short "the Commission") which has allowed the claim of the respondent.;