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Judgment
Ajit Bharihoke, Presiding Member
[1] This revision is directed against the order of the State Commission Maharashtra dated 15.04.2009 in Appeal No.105/08 arising out of consumer complaint no. 274/07 whereby the State Commission dismissed the appeal preferred by the petitioner bank against the order of the District Forum.
[2] Briefly stated facts relevant for the disposal of the revision petition are that petitioner complainant filed a consumer complaint in the District Forum Nasik alleging that he had taken an insurance policy from the opposite party which covered various perils including the loss if any, caused to the bank due to infidelity and criminal act on the part of the appraisers. According to the complainant, due to fraudulent act on the part of the approved appraisers of the bank i.e. incorrectly valuation of the gold hypothecated, the insured suffered loss to the tune of Rs.8,13,157/-. The insurance claim in this regard was submitted but the respondent opposite party instead of sanctioning the claim to the maximum limit of Rs.3.00 lacs, settled it for Rs.11,250/-. Claiming this to be deficiency in service, the petitioner filed a consumer complaint.
[3] The respondent opposite party in its written statement admitted the issue of banker''s insurance indemnity policy for the period18.12.204 to 17.12.2005 for basic sum assured of Rs.3.00 lacs. According to the opposite party, as per condition ( G ) of the insurance policy, the insurer had limited its liability for any loss or losses during the period of insurance contract due to infidelity or criminal act of each of the appraiser to 5% of the basic sum assured or Rs.20,000/- whichever is less. It was pleaded that basic sum assured was Rs.3.00 lacs. Therefore, its 5% amounted to Rs.15,000/- and after adjusting the excess of 25% as per terms and conditions of contract, the only amount payable was Rs.11,250/-, which was sanctioned. Thus, it was pleaded that opposite party has not committed any deficiency in service.
[4] Learned District Forum on consideration of the pleadings and the evidence came to the conclusion that in terms of condition "G" of the terms and condition of the insurance policy, the opposite party has rightly allowed the claim to the extent of Rs.11,250/- and offered the same to the complainant. Thus, there was no deficiency on the part of the opposite party. The District Forum accordingly dismissed the complaint.
[5] Being aggrieved of the order of the District Forum, the petitioner bank approached the State Commission in appeal and the State Commission vide impugned order affirmed the finding of the District Forum and dismissed the appeal. This has led to the filing of the revision petition.
[6] Mr. S.K.Sharma, Advocate for the petitioner has assailed the impugned order of the foras below on the ground that both the foras below have committed a grave error in relying upon condition "G" of the terms and conditions of the insurance policy ignoring the fact that terms and conditions were never supplied to the petitioner. In support of his contention, counsel for the petitioner has referred to the judgment of the Supreme Court in the mater of M/s Modern Insulators Ltd. Vs. Oriental Insurance Co. Ltd., 2000 1 CPJ 1 .
[7] Learned counsel for the respondent on the contrary has argued in support of the impugned orders. It is contended that foras below have rightly applied condition "G" of the insurance contract to conclude that insurance company has rightly allowed the claim to the extent of Rs.11,250/- and have committed no deficiency in service.
[8] We have considered the rival contentions and perused the record. Only contention of the petitioner is that respondent insurance company is estopped from invoking condition ( G) of the terms and condition of the insurance policy because those were never supplied to the petitioner complainant. The plea of the petitioner complainant regarding non receipt of terms and conditions is belied by the letter of the petitioner dated 03.08.2006 addressed to the manager of the respondent insurance company wherein the petitioner has mentioned the number of the banker''s indemnity insurance policy taken by the petitioner as policy no. 2005/160801/46/05/00324 on 18.12.2005. At the bottom of this letter, the petitioner has described the enclosures as : (i) Policy No. 2004/160801/43/04/00306 dated 18.12.2004 and ( ii) 2005/160801/43/05/00324 dated 18.12.2005, which are the current policy as also the previous year''s policy. From this it is evident that petitioner was actually supplied with the insurance policy and his statement to the effect that petitioner was never issued the insurance policy is incorrect.
[9] Even if it is assumed that terms and conditions of the insurance policy were not supplied to the petitioner, then also, the petitioner does not have a case. The cover note admittedly issued by the respondent insurance company is Ex. C-2. The relevant portion of the cover note reads as thus: "The insured named in the schedule below having this day proposed to effect an insurance described in the said schedule is held covered for a period of fifteen days only from the date of issue of this temporary cover note subject to terms provisions exceptions conditions of the Company''s standard printed policy clause as may be applicable to the class of insurance."
[10] On reading of the above, it is clear that cover note was issued subject to the company''s standard printed policy clause as may be applicable to the class of insurance. The case of the petitioner is that the petitioner cannot take advantage of the standard terms and conditions as the policy with terms and conditions was not supplied to the petitioner. We do not find merit in the above contention of learned counsel for the petitioner. The issue raised by the petitioner is no more resintegra and it has been set at rest by five members Bench of the Supreme Court in the matter of General Assurance Society Ltd. Vs. Chandmull Jain & Anr., 1966 AIR(SC) 1644 wherein Hon''ble Supreme Court held as under: "A contract of insurance is a species of commercial transactions and there is a well-established commercial practice to send cover notes even prior to the completion of a proper proposal or while the proposal is being considered or a policy is in preparation for delivery. A cover note is a temporary and limited agreement. It may be self-contained or it may incorporate by reference the terms and conditions of the future policy. When the cover note incorporates the policy in this manner, it does not have to recite the term and conditions, but merely to refer to a particular standard policy. If the proposal is for a standard policy and the cover note refers to it, the assured is taken to have accepted the terms of that policy. The reference to the policy and its terms and conditions may be expressed in the proposal or the cover note or even in the letter of acceptance including the cover note. The incorporation of the terms and conditions of the policy may also arise from a combination of references, in two or more documents passing between the parties. Documents like the proposal, cover note and the policy are commercial documents and to interpret them commercial habits and practice cannot altogether be ignored. During the time the cover note operates, the relations of the parties are governed by its terms and conditions, if any. but more usually by the terms and conditions of the policy bargained for and to be issued. When this happens the terms of the policy are incipient but after the period of temporary cover, the relations are governed only by the terms and conditions of the policy unless insurance is declined in the meantime. Delay in issuing the policy makes no difference. The relations even then are governed by the future policy if the cover notes give sufficient indication that it would be so. In other respects there is no difference between a contract of insurance and any other contract except that in a contract of insurance there is a requirement of uberrima fides i.e., good faith on the part of the assured and the contract is likely to be construed contra proferentem that is against the company in case of ambiguity or doubt. A contract is formed when there is an unqualified acceptance of the proposal. Acceptance may be expressed in writing or it may even be implied if the insurer accepts the premium and retains it. In the case of the assured, a positive act on his part by which he recognises or seeks to enforce the policy amounts to an affirmation of it. This position was clearly recognised by the assured himself, because he wrote, 510close upon the expiry of the time of the cover notes, that either a policy should be issued to him before that period had expired or the cover note extended in time. In interpreting documents relating to a contract of insurance, the duty of the court is to interpret the words in which the contract is expressed by the parties because it is not for the court to make a new contract, however reasonable, if the parties have not made it themselves. Looking at the proposal, the letter of acceptance and the cover notes, it is clear that a contract, of insurance under the standard policy for fire and extended to cover flood, cyclone etc. had come into being."
[11] In view of the law laid down by five members bench of the Apex Court, the judgment of Modern Insulators Ltd. is of no avail to the petitioner.
[12] In view of the above, it is clear that insurance cover extended vide subject cover note is subject to the standard terms and conditions of insurance contract. Both the foras below vide reasoned orders have dismissed the complaint in view of condition " G" of the terms and conditions of the policy. Interpretation of condition "G" by the foras below cannot be faulted. Therefore, we do not find any material irregularity or jurisdictional error in the impugned order which may call for interference in exercise of revisional jurisdiction. Revision petition is, therefore, dismissed.