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Judgment
OPPOSITE parties 1 and 2 in O. P. No. 2/2005 on the file of the District Consumer Disputes Redressal Forum, Nagapattinam, are the appellants herein. The matter relates to payment of crop insurance. The facts necessary for the disposal of the appeal are as under: (a) The complainant an agriculturist and holder of Kisan Credit Card was entitled to avail credit limit from opposite party No. 3 bank. In that scheme, the borrower should specifically mention the crop wise quantum amount in order that the bank would note down crop-wise particulars vis--vis credit limits approved. The details given by the farmer at the time of the withdrawal shall form the basis for coverage under National Agricultural Insurance Scheme (NAIS ). The complainant sought a loan of Rs. 18,000 in July 2002 for cultivating Samba/thaladi crops in his land. The sowing would start in August and harvesting would be done in January following. According to the complainant, he sought credit under Kisan Credit Card Scheme for Thaladi crop only. According to opposite parties 1 and 2 the credit sought was only for Kuruvai which was for the period from April to July. The whole question is whether the complainant''s borrowing related to Kuruvai or Thaladi. According to opposite parties 1 and 2 Insurance Company the premium was received by them for Kuruvai and the failure of crops was during the Thaladi season and in such circumstances, the complainant would not be entitled to claim any compensation.
SO far as opposite party No. 3 bank was concerned, they chose to remain ex parte. The District Forum accepted the case of the complainant and directed opposite parties 1 and 2 together and the 3rd opposite party to pay a sum of Rs. 8,181 to the complainant. Challenging that opposite parties 1 and 2 have filed the appeal.
In the appeal, it is contended that the complaint against Agricultural insurance company was not maintainable for the following reasons: Insurance cover was not a regular type of insurance business carried on by insurance companies. The General Insurance Corporation functioned only as an agent for both Central and State Governments for the purpose of administering the scheme called comprehensive crop insurance scheme propounded by the Central Government. The scheme was implemented with the involvement of State Government. The State Government had constituted a State Crop Insurance Fund for implementing the scheme and administered by Secretary, Agriculture, Government of Tamilnadu as its Chairman and the Registrar of Crop Societies, as its convenor. A nominal premium amount was routed to GIC only through nodal banks, which advanced loans to farmers and this money was held as trust on behalf of the Central and State Governments. Whenever the GIC was called upon to pay claims under the provisions of the Scheme, it would make payment. For such payments GIC would obtain the requisite funds 2/3rd from Central Government and 1/3rd from the State Government. The claim amount was also routed through the respective nodal banks that advanced loan to farmers and that too only after due sanction for such claim payment from the Ministry of Agriculture, Government of India and on receipt of funds from Central and State Governments. No separate insurance policy was given to individual farmers. The entitlement for claim was governed by the scheme. The Central and State Governments ought to have been made parties. Further, the scheme was only a social welfare measure meant for the welfare of all the farmers and did not provide for coverage for individual farmers. There was no hiring of service of the Insurance Company. In any event, so far as the complainant was concerned, he was not entitled to compensation. The compensation was worked out as a result of crop cutting experiments conducted by the State Government and other reports submitted by the Agricultural Department. Further, as per the scheme, the maximum sum insured was limited to Rs. 10,000 per farmer per season for all crops, irrespective of the quantum of loan taken. It was for the State Government authorities to answer the claim. Opposite parties 1 and 2 disbursed the amount only on the basis of the report filed by the State Government. The period covered had lapsed and therefore the complainants were not entitled to any compensation.
PER contra, the complainant appeared in person and made the following submissions: The question related to the period for which there was cover. The disbursing bank namely the 3rd opposite party had debited the complainant''s account in a sum of Rs. 369 only on 29. 8. 2002 as the complainant availed loan of Rs. 18,000 for Thaladi/samba season for the year 2002-03 and sent it to opposite parties 1 and 2 through their Nodal Branch. There was consideration and the complaint was therefore maintainable. The 3rd opposite party was acting as an agent of opposite parties 1 and 2 and was getting 2. 5% of the premium amount as service charge from the Insurance Company and therefore there was privity of contract. The District Forum had rightly found that the complainant had availed loan for Thaladi/samba season and therefore was entitled to compensation. As already noted, the 3rd opposite party Nodal Bank remained ex parte. During the course of the hearing, the complainant produced a letter from OP3 State Bank of India stating that the loan was extended only for raising Thaladi/samba and the complainant was entitled to the amount as claimed by him. We asked the complainant to serve notice on the bank and on behalf of the bank the Chief Manager of the Mayiladuthurai branch has filed an affidavit before us stating inter alia as follows: The insurance premium of Rs. 369 was debited to the account of the complainant and was sent along with the premiums debited from other cultivators/borrowers of Samba Thaladi crops by DD dated 29. 8. 2002 to opposite parties 1 and 2 through Nodal bank. The names of the borrowers and the amounts debited in the respective accounts and the total amount for which DD was issued in favour of General Insurance Corporation was shown in the statement of account marked as Ex. A10 in the proceedings before the District Forum. Due to drought in Nagapattinam and other areas including the area of the complainant in the year 2002-2003, insurance compensation was claimed and the same was paid in the year 2004. The claim for insurance amount was lodged by opposite party No. 3 for all the borrowers/customers who availed loan for Samba/thaladi crop. The insurance claim was settled at Rs. 24,71,828. 07 and the 3rd opposite party bank received the said amount on 13. 1. 2004. However, the claim of the complainant was not included in the said amount. When the complainant pointed out this to the bank, the bank took up the matter with opposite parties 1 and 2 by a letter dated 17. 6. 2004 marked as Ex. A1. By the said letter, opposite party No. 3 bank informed that the claim of the complainant was genuine and since the loan was sanctioned on 26. 7. 2002 the premium was included in the Kuruvai season. There was an error in the statement to the effect that the premium was included in the Kuruvai season and the same was wrong as was evidenced by the interview-cum-assessment form and the fact that the premium debited from the account of the complainant was included only in the DD issued on 29. 8. 2002. The mistake that had crept in the said letter of the opposite party No. 3 was unintentional. By the said letter, opposite party No. 3 also pointed out that the complainant suffered loss and the yield was below 20% and his request was genuine and hence the claim could be settled favourably.
IN essence, opposite party No. 3 has supported the case of the complainant. However, having regard to the mistake committed by them in informing the opposite parties 1 and 2 that the amount related to Kuruvai the problem had arisen for the complainant. There are adequate materials to support the stand of the complainant that opposite parties 1 and 2 were service providers. They had received consideration and, therefore, the complaint against them was indeed maintainable. In such circumstances, we are of the view that interests of justice would be best served if opposite party No. 3 and the appellants/opposite parties are directed to share the amount awarded by the District Forum to the complainant equally and pay the same in such proportion to the complainant. We, therefore, confirm the order of the District Forum directing the 1st, 2nd and 3rd opposite parties to pay the said sum of Rs. 8,181 with interest @ 9% p. a. from 9. 8. 2004 and Rs. 1,000 as costs. The only modification which we are imposing is that the amount shall be paid in moiety by opposite parties 1 and 2 together on the one side and the 3rd opposite party bank on the other. The order of the District Forum is accordingly confirmed with such modification. There will be no order as to costs in the appeal. Appeal disposed of.