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New Delhi: The Supreme Court has rejected a paper company's claim for compensation on account of 'mental harassment' from state-owned National Insurance Company, saying that firms, unlike individuals, cannot be recompensed by insurers for this.
A Bench comprising Justices D K Jain and R M Lodha, while rejecting Muzaffarnagar-based Sikka Papers Ltd's claim for damages from National Insurance Company (NIC) on account of mental agony, said: “It is only the natural person who can claim damages for mental harassment and not the corporate entity.” The significant ruling came on Muzaffarnagar-based Sikka Papers Ltd's plea challenging the National Consumer Disputes Redressal Commission's order that rejected its claim for Rs 35 lakh, including Rs 10 lakh for mental harassment, from NIC towards repair of an insured diesel generator.
The Bench, while upholding the consumer court's order that asked the insurance company to pay Rs 10,47,491 plus interest at 12 per cent from March 2000 till the date of payment, said that NIC was liable to pay only for those parts affected by the accident.
However, it said that the company's claim for causing mental harassment by denying its rightful demand was “wholly misconceived and untenable”.
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