NCDRC cannot selectively accept only parts of expert reports that support its conclusions: Supreme Court

The Supreme Court recently set aside a National Consumer Disputes Redressal Commission (NCDRC) order after noting that it relied only on selective portions of reports by experts in a matter. [SS Cold Storage India Pvt Ltd vs National Insurance Company Ltd].A bench of Justices AS Bopanna and Dipankar Datta also made it clear that such bodies cannot sit in appeal over expert reports, and can only draw inferences from the material on record.The Court partially allowed a cold storage company's appeal against an NCDRC order refusing it a payout from an insurance company."As judges, we are not experts in the field of refrigeration of cold storages to opine on our own which of the two versions is correct and acceptable. This also applies to the members of the NCDRC. We are aghast to find that the members, who heard the Complaint, have made observations as if they were experts sitting in appeal on the reports of the Loss Assessor and the Experts ... It was not open to the NCDRC to rely on portions of the reports which supported its conclusions ... and discard the rest because the observations came in conflict with such conclusions. The NCDRC ought to have either accepted or rejected the reports in full and not accept/reject the same in part, since the contents were to be read as a whole, not being severable.".The insurance company was eventually directed to pay ₹2.25 crore to the cold storage company..The incident leading to the consumer dispute dated back to 1997.The appellant before the Supreme Court, SS Cold Storage India Private Limited, had taken various insurance policies for its constituent units from the National Insurance Company Limited.There was a leakage of ammonia in the facilities of the appellant, which led to damage of huge quantities of potatoes stored. The insurance company, based on a report from a surveyor, concluded that the damage was not covered by insurance as the leak allegedly happened due to wear and tear of the pipes and not due to any sudden burst.However, the reports of experts and a loss assessor appointed by the appellant company indicated otherwise.The NCDRC, however, refused to grant the cold storage company any relief. Rather, it relied on the surveyor's conclusions and portions of other reports to rule in the insurance company's favour. This led to the appeal before the Supreme Court.The appellant's counsel pointed out that three expert reports had shown that the cracks were due to an accident which cannot be attributed to usual wear and tear. .The Supreme Court ultimately leaned in favour of the appellant's explanation that the leakage was due to an unforeseen accident that was covered by insurance.Refusal to pay the claim amounted to a deficiency in service, the bench added. "We hold that the NCDRC committed serious error by not giving the reports placed on record by the Appellant the extent of credence the same deserved. The manner in which the NCDRC dealt with such reports was not proper and legal; major part of the reports could not have been rejected and only stray observations relied upon to support the conclusions. This is one of the foremost reasons which compels us to interfere with the impugned judgment and order," the Court concluded..Senior Advocate Vijay Hansaria represented SS Cold Storage Pvt Ltd while advocate Yogesh Malhotra appeared for the National Insurance Company..[Read Judgment]