Following our report last month of the Supreme Court decision in Genus Power, we now report a further welcome judgment on the sanctity of discharge vouchers/settlement agreements. This is a 16 December 2014 National Commission decision in a case where the Insured claimed to have signed the discharge voucher and accepted the settlement amount under duress. The case is: Garg Acrylics Ltd v United India MANU/CF/0839/2014.
The Insured took a Standard Fire and Special Peril Insurance Policy from UII in March 2009. A fire occurred in December 2009. The Insured claimed Rs.5 crores, but the surveyor assessed the loss at c. Rs.2.67 crores, and in December 2010 the Insured accepted a cheque of c. Rs.2.70 crores.
National Commission's Reasoning & Judgment
The Insured filed a complaint before the State Commission which was rejected for lack of pecuniary jurisdiction and thereafter, the Insured filed a complaint before the National Commission which supported the Insurer, for the following reasons:
- The discharge voucher was not dated but the Insured admitted that it received payment by way of the cheque dated 1 December 2010. It, therefore, meant that the amount was paid on 1 December 2010.
- The cheque was encashed before filing the complaint before the National Commission and "this fact smacks of malafides of intention on the part of the complainant". The Commission further said:
- The Insured sent letters to the Insurer in 2010 (2 weeks after the date of the cheque) and again in 2011 for further payment but the Insurer reiterated that the claim had been settled fully and finally as per the discharge voucher. In this regard, the Commission observed that:
- In relation to the Insured's allegations against the surveyor, the Commission observed that:
- The Commission rejected the Insured's arguments that: (a) it had accepted the amount under duress because he had taken loan from the Bank and he was being forced by the Bank to return the money; (b) the execution of the discharge voucher as a pre-condition to release the amount itself amounts to economic duress and coercion and also to arm twisting tactics. The Commission held that:
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Originally published 31 December 2014
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