Supreme Court Bars Article 136 SLPs Against NCDRC's Appellate Orders

Supreme Court Bars Article 136 SLPs Against NCDRC's Appellate Orders

On Wednesday, the Supreme Court clarified that if an order issued by the National Consumer Disputes Redressal Commission (NCDRC) is within the scope of its original jurisdiction, an aggrieved party can approach the Supreme Court under Article 136 of the Constitution to seek special leave for appeal. However, the Apex Court emphasised that any orders passed by the NCDRC in the exercise of its appellate or revisional jurisdiction cannot be subjected to further appeal.

In the aforementioned case, a Division Bench comprising Justices J B Pardiwala and Manoj Misra scrutinised the extent of Article 136 of the Constitution. They did so by delving into various prior decisions of the Apex Court, and they concluded that the power under Article 136 should only be invoked when dealing with matters of significant public importance involving questions of law or when confronted with decisions that deeply offend the court's sense of justice and fairness.

The Bench underscored that the Supreme Court's authority to grant special leave to appeal can only be invoked in extremely exceptional situations. One of the key requirements for the grant of special leave is that the case must involve a question of law that holds significant importance for the general public, or it must pertain to a decision that profoundly and deeply affects the conscience of the Court.

“The provisions of Article 136 of the Constitution as such are not circumscribed by any limitation. But when the party aggrieved has alternative remedy to go before the High Court, invoking its writ jurisdiction or supervisory jurisdiction as the case may be, this Court should not entertain petition seeking special leave thereby short-circuit the legal procedure prescribed. The limitation, whatever, they be are implicit in the nature and character of the power itself. It being an exceptional and overriding power, naturally it has to be exercised sparingly and with caution and only in very exceptional situations. The power will only be used to advance the cause of justice and its exercise will be governed by well-established principles which govern the exercise of overriding constitutional powers,” the Bench stated.

The Court was deliberating on a Special Leave Petition (SLP) filed challenging the dismissal order issued by the National Consumer Disputes Redressal Commission (NCDRC) in response to an appeal against an order of the State Consumer Disputes Redressal Commission (SCDRC).

The Court examined whether it should entertain a Special Leave Petition directly against the order passed by the NCDRC in its appellate jurisdiction, particularly when the aggrieved party has the option to seek redress by approaching the appropriate High Court under Article 226 or Article 227 of the Constitution.

The Bench concluded that a careful examination of the provisions of the Consumer Protection Act, 1986 (which are pari materia to the Consumer Protection Act, 2019) indicates that the recourse of appealing to the Apex Court is applicable solely to orders issued by the NCDRC under the powers conferred by Section 21(a)(i) of the Act 1986 and Section 58(1)(a)(i) or Section 58(1)(a)(ii) of the Act 2019.

The Top Court observed that both the Consumer Protection Acts provide the option for an appeal to the Supreme Court solely in cases where the NCDRC has acted in its original jurisdiction or as the court of first instance (original orders). However, no further appeal is permissible against the orders issued by the NCDRC while functioning in its appellate or revisional jurisdiction.

In the present case before the Supreme Court, the factual background was that the Respondent had obtained insurance policies from both Allahabad Bank and Universal Sompo General Insurance, covering risks up to ₹50 lakh for fire and burglary incidents. The Petitioner is Universal Sompo General Insurance, the party initiating the legal proceedings before the Apex Court.

Following the incidents of theft and a fire outbreak at the Respondent's premises, he filed a claim amounting to ₹49 lakh with Universal Sompo General Insurance (the Petitioner). However, the Petitioner denied the claim. Subsequently, the Respondent sought recourse by approaching the State Consumer Disputes Redressal Commission (SCDRC). The SCDRC partially allowed the complaint.

Dissatisfied with the decision of the SCDRC, the Petitioner Universal Sompo General Insurance appealed the matter before the National Consumer Disputes Redressal Commission (NCDRC). The NCDRC, however, dismissed the appeal. In response to this dismissal, the Petitioner then took the matter to the Supreme Court by filing an appeal under Article 136 of the Constitution.

The Supreme Court based its decision on the recent ruling in the case of Faizan v. Omaxe Buildhome Private Limited, which was reported in 2022 INSC 573. In that case, the Apex Court had clarified that if an aggrieved party seeks to challenge an order passed by the NCDRC in an appeal under Section 58(1)(a)(iii) or Section 58(1)(a)(iv), the appropriate remedy available to them is to approach the concerned High Court with jurisdiction under Article 227 of the Constitution.

The Faizan v. Omaxe Buildhome Private Limited decision emphasised the significance of seeking redress through the High Court when there is a remedy available under Article 226 or Article 227 of the Constitution.

Consequently, the Apex Court dismissed the petition without delving into its merits. However, the petitioner was granted the liberty to challenge the order of the NCDRC by approaching the appropriate High Court with jurisdiction.

“We have reached to the conclusion that we should not adjudicate this petition on merits. We must ask the petitioner herein to first go before the jurisdictional High Court either by way of a writ application under Article 226 of the Constitution or by invoking the supervisory jurisdiction of the jurisdictional High Court under Article 227 of the Constitution. Of course, after the High Court adjudicates and passes a final order, it is always open for either of the parties to thereafter come before this Court by filing Special Leave Petition, seeking leave to appeal under Article 136 of the Constitution,” the Supreme Court concluded.