Oil firm responsible for defective cylinder

A company needs to conclusively show that the consumer was negligent to refute any claim

Ravindra Rao was a liquefied petroleum gas (LPG) consumer of Indian Oil Corporation through its distributor, Shree Enterprises. On the morning of April 23, 2008, his father replaced the used empty cylinder. While fixing the regulator, the pin inside the neck of the fresh cylinder slipped, resulting in leakage of gas. When the electric light was switched on, a fire broke out. At this time, Rao was on duty. His father, mother, wife and two daughters, who were in the house, suffered serious injuries and had to be shifted to hospital. Later, his father, mother and daughter passed away. His wife, though seriously injured, survived after prolonged treatment. The second daughter survived but was defaced. The property and building were also damaged.

Rao filed a consumer complaint against Indian Oil, its distributor and the insurer. He alleged the company and its dealer were negligent. Indian Oil denied the allegations. It claimed it carried out all the requisite checks for safety, such as subjecting the cylinders to immersion test before sending them to the distributor, where they were checked again. The cylinder involved was sent to the LPG Equipment Research Centre in Bengaluru for analysis. The report said there was no valve pin, spring and locking screw, due to which it could not be tested.
 

The company attributed the accident to a mistake of the customer in handling the cylinder and its valve pin, and for keeping the electric stove on while replacing the regulator. Indian Oil stated it had a policy from New India Assurance which covered the incident, Rao should lodge an insurance claim. The forum, however, directed the oil company and its dealer were jointly liable to pay Rs 10.5 lakh along with 9 per cent interest from the date of complaint and Rs 5,000 as the litigation expense. 
 

Indian Oil challenged this order before the Karnataka State Commission. On dismissal, it approached the National Commission. It contended the contract with their dealer was on a “principal to principal” basis. So, there was no privity of contract between the oil company and the consumer. The company argued the valve pin must have gone down in the cylinder due to mishandling.
 

The National Commission observed the question was whether it had occurred due to the cylinder being defective. There was no evidence to show the consumer was negligent. Indian Oil did not place the safety inspection report on record, too. And, there was no analysis after the incident to throw light on the exact cause.
 

The Commission concluded that Indian Oil and its distributor have a duty to ensure consumer safety. Unless there is concrete evidence to establish that the consumer is negligent, it is to be inferred that the incident occurred due to some fault, imperfection or shortcoming in the cylinder. 
 

Accordingly, by its order of January 24, 2017, delivered by B C Gupta, along with Prem Narain, the National Commission concluded both Indian Oil and its distributor had rightly been held guilty of deficiency in service and dismissed the revision petition. 

The author is a consumer activist