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It is common knowledge that LPG is a highly combustible gas and, hence, one needs to deal with it carefully. What most people, however, do not know is that one cc of liquid LPG (it is stored in the cylinder as liquid under pressure) multiplies into 270 cc of gaseous LPG and this helps it spread rapidly in the atmosphere. That's why if there is any leakage of gas from a cylinder, it should immediately be removed to an open area. But despite precautions, accidents can happen, particularly if there is a defect in the cylinder or the cylinder bursts for some reason. In cases such as this, the casualty can be high and damage to property, quite extensive. It is for this reason that every LPG dealer is supposed to take a comprehensive insurance policy to cover any untoward incident, resulting in injury to himself or his employees or the public or the customers. Similarly, the insurance is also supposed to cover damage to property of the dealer himself, public property or that of the customer. Thus, in case of an unexpected incident, the insurance company is expected to indemnify the loss. But would that be enough? Shouldn't the oil company or the dealer (or both) be held accountable if the accident is caused on account of their negligence or failure to ensure the safety of the cylinder? The apex consumer court discussed this question at length in a recent case and its decision would certainly make both oil companies and the dealers pay due attention to the safety of the cylinders that they supply. In this particular case dating back to 1996, while lighting the stove, the cylinder exploded, starting a major fire and causing extensive damage to the two-storey building of the consumer, Kaluram Jasraj Vyas. Since on one of the floors, he was running a shop and had stored furniture, the loss was even more, assessed at Rs 9,65,800. Fortunately, there were no casualties, even though the fire had even spread to the neighbouring houses by the time it was extinguished. However, when Vyas sought indemnification of his loss, the dealer pointed to the insurance company, which, however, neither responded nor appointed a surveyor. The State Consumer Disputes Redressal Commission, before which the Vyas then filed a complaint, asked the insurer to pay. It, however, held that the dealer as well as the oil company, HPCL, were not liable. Against this order, the insurance company filed an appeal before the national commission. After examining all the facts of the case, the apex court held that under the public liability clause, the insurance company would be liable to reimburse the dealer, for the compensation he is required to pay the consumer. "At the same time, it is to be stated that because of the defective cylinder or the regulator, the accident has taken place and, hence, it cannot be held that the dealer or the HPCL would not be liable. Primary liability would be that of the HPCL", the commission said. It, therefore, held that both the dealer and the HPCL would be jointly and severally liable to indemnify the loss suffered by the consumer. Since the dealer has taken the insurance, the latter would also be liable. In 2006, the apex court had taken up a somewhat similar case wherein a consumer had died (in 1995) on account of the burn injuries suffered from a gas fire. In this case, the oil company had argued that only the distributor was liable to pay compensation to the consumer and all LPG dealers or distributors are supposed to take an insurance policy to cover such risks. In this case, too, the national commission had concluded that the oil company, too, had to take responsibility for selling a defective cylinder and had, therefore, held that both the dealer and the oil company were jointly and severally liable to pay a compensation of Rs 10,08,000 along with interest at the rate of 9 per cent per anum and costs amounting to Rs 5,000. The insurance company — National Insurance — had also came under fire for its "negative attitude". Referring to its advice to the dealer (when informed of the accident and the claim) not to make any admission of compensation without the insurance company's prior consent, the national commission said it showed a typical negative approach on the part of the insurance company. This was totally unjustifiable.
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