GENERAL MANAGER, NATIONAL INSURANCE CO. LTD vs MD.PARVEJ ALAM

BOTH the appeals are directed against an order dated 4.5.1995 passed by the District Forum, Munger, in Complaint Case No. 203 of 1994 and hence both the appeals are being disposed of by this common judgment. By the aforesaid impugned order the District Forum directed the opposite parties (appellants) to pay to the complainant a sum of Rs. 70,200/- (Rs. seventy thousand two hundred) jointly or severally as compensation for deficient and faulty service rendered by them together with interest @ 18% per annum from the date of the institution of the claim (13.2.1993) till the realisation of the amount. The District Forum further directed for payment of Rs. 2,000/-. (Rs. two thousand)as compensation for the mental harassment caused to the complainant and Rs. 1,000/- (Rs. one thousand) as the cost incurred for instituting the case.

IN Appeal No. 217/1995 opposite parties 1 to 4 in the complaint petition are the appellants IN Appeal No. 221/1995 the opposite party No 5 (State Bank of INdia, Main Branch, Bara Bazar Munger) before the District Forum is the appellant. IN both the appeals complainant Md. Parvej Alam is respondent No. 1. The case of the complainant Md. Parvej Alam (respondent No. 1) before the District Forum was that he holds a Cash Credit Loan Limit facility with opposite party No. 5 (State Bank of India, Main Branch, Bara Bazar, Munger who is appellant in Appeal No. 221/1995) upto a limit of Rs. one lac. He deals in potato, onions and vegetables which are perishable items and hence the Bank used to get the loan amount advanced to him insured with the mutual consent of the Bank and the complainant. The premium amount used to be credited from the account of the complainant. The entire process of insuring the complainant''s business premises used to be done in absence of the complainant and hence the complainant was not in a position to know as to what had been mentioned in the insurance proposal form. He was doing business at Koura Maidan, Munger but subsequently he somehow managed to hire a stall bearing No. 79 at Raja Bazar, Sabji Mandi, Munger and informed the Bank regarding starting business at the aforesaid stall on 2.7.1992 On 17.7.1992 the stock of business was insured with the National Insurance Company Limited (appellant in Appeal No. 217/ 1995) vide Policy No. 48/92/98/00095 for Rs. 2,25,000/-. On 13.12.1992 the stock of the complainant at Stall No. 79, Raja Bazar, Sabji Mandi, Munger was looted by miscreants for which FIR was lodged and the Bank (appellant in Appeal No. 221/1995) was informed by the complainant to claim compensation from the National Insurance Company Limited. The Bank lodged the claim as per his instruction with Insurance Company. But the said Company repudiated the claim on the ground that business place of the complainant was Koura Maidan Mohalla and not Stall No. 79, Raja Bazar, Sabji Mandi, Mungef and the latter place of business was not covered by the insurance. Further case of the complainant is that he had informed the Bank that Stall No. 79 of Raja Bazar, Munger was also place of his business and he was under the impression that the insurance covered the stock at Stall No. 79 of Raja Bazar, Sabji Mandi, Munger also. But it seems that neither Stall No. 79 of Raja Bazar, Sabji Mandi has been mentioned in the proposal form of the Insurance Company nor the fact that the complainant deals in onion, vegetables etc. has been mentioned. In case the insurance did not cover Stall No. 79 of Raja Bazar, the Bank who had been informed about the same, was responsible for providing deficient service to him (complainant). On the aforesaid allegations the complainant claimed Rs. 70,200/- as compensation together with interest @ 18% per annum. Apart from that, the complainant also claimed Rs. 10,000/- by way of damages for mental harassment and agony suffered by him and Rs. 2,000/- as cost.

The Bank (opposite party No. 5 before the District Forum) filed written statement and contested the claim of the complainant. The case of the Bank was that the complainant had cash credit loan facility upto Rs. one lac for doing wholesale business in potato, onion and vegetables at Koura Maidan and the said place of business had been insured with mutual consent of the complainant and the Bankand the premium of the policy was being paid by debit to the cash credit account of the complainant as per his advice. The insurance policy was filled up by the agent of the Insurance Company who had been given the details of business premises at Koura Maidan and Stall No. 79 at Sabji Mandi, Raja Bazar but the agent of National Insurance Company did not mention Stall No. 79 at Sabji Mandi, Raja Bazar as place of business of the complainant. Further case of opposite party No. 5 is that the Bank is not liable to compensate the complainant for the loss, if any, suffered by him. The claim of the complainant has also been challenged on the ground that he had the status of a commercial entity and was not a consumer and under the circumstances he cannot claim compensation. It is also the case of the Bank (opposite party No. 5) that the statement of stock as made by the complainant was exaggerated one. The complainant was at liberty to ensure his place of business with any Insurance Company. Only when the complainant failed to insure, the Bank used to get insured the business place of the complainant and accordingly the business place at Koura Maidan had been insured with the National Insurance Company Limited. The National Insurance Company was under obligation to send a copy of the policy to the complainant but the Company failed to discharge its duty. The loss as alleged by the complainant is false, bogus and highly exaggerated as Stall No. 79 could not have contained the stock shown by the complainant at Raja Bazar. The loss, if any, has occurred due to laches on the part of the Insurance Company and there has been no deficiency in service on the part of the Bank.

NATIONAL Insurance Company Ltd. (opposite party No. 1 before the District Forum and the appellant in Appeal No. 217/1995) filed a separate written statement and contested the claim of the complainant. NATIONAL Insurance Company has not denied that the business premises of the complainant at Koura Maidan, Munger, had been insured but the claim of the complainant that Stall No. 79 of Sabji Mandi, Raja Bazar, had been insured under the said policy has been denied. According to the NATIONAL Insurance Company Ltd. the complainant is not entitled to claim compensation for the loss, if any, suffered by him due to alleged loot of aforesaid Stall No. 79. It has also been alleged by the Insurance Company that the stock as given by the complainant was exaggerated one and the Insurance Company was not liable to compensate the complainant for the alleged loss caused due to the negligence of the Bank. Now it has to be seen if the impugned judgment of the District Forum is sustainable in law or not.

CERTAIN facts are not disputed. It is not disputed that the complainant had cash credit loan limit facility of Rs. one lac with the State Bank of India, Main Branch, Bara Bazar, Munger (opposite party No. 5 and appellant in Appeal No. 221/1995).It is also not disputed that initially the business premises of the complainant was at Koura Maidan, Munger. It is also not disputed that subsequently the complainant also started business at Stall No. 79 of Sabji Mandi, Raja Bazar, Munger. It is also not disputed that the stock of the complainant at Koura Bazar premises had been insured with the National Insurance Company. It is also not disputed that when the complainant started business at Stall No. 79 of Sabji Mandi, he informed the Bank about the same. Moreover, this fact is also apparent from the letter marked Annexure-B of the complainant addressed to the State Bank of India. It may be pointed out that the National Insurance Company, appellant in Appeal No. 217/1995, can be held liable to compensate the complainant for the loss, if any, caused to him, only when it is proved that the stock at Stall No. 79 of Sabji Mandi had also been insured and was covered by the insurance policy in question. It is not disputed that the proposal-cum-policy schedule (Annexure-A) with regard to insurance of the business premises of the complainant does not mention about Stall No. 79 of Sabji Mandi, Raja Bazar, Munger. A photo copy of the proposal-cum-policy schedule has been brought on record by the National Insurance Company Ltd. and nothing was pointed out therein on behalf of the complainant (respondent No. 1) to show that the insurance covered the stock at Stall No. 79 of Sabji Mand i also. According to the Bank (opposite party No. 5 who is appellant in Appeal No. 221/1995) the proposal form for insurance policy was filled up by the agent of the National Insurance Company Ltd. who was given the details of the business place at Koura Maidan and Stall No. 79 at Sabji Mandi but he did not mention the business place of the complainant at Stall No. 79, Sabji Mandi for the reasons best known to him. In this connection it was pointed out on behalf of the Insurance Company that had the details of the business place at Stall No. 79 at Sabji Mandi been given to any agent and had the agent omitted to mention the same in proposal form, the natural conduct on the part of the Bank would have been to point out the same and get the same inserted in the proposal form. But the Bank did not do so and it goes to show that the plea to the aforesaid effect has been advanced by the Bank with a view to save its skin. This contention on behalf of the National Insurance Company cannot be said to be without substance. It would not be out of place to mention here that the name of the alleged agent of the Insurance Company has neither been disclosed in the written statement nor in the affidavit filed on behalf of the Bank. The so called agent has not even been imp leaded as a party in the complaint case. In view of this the plea of the Bank to the aforesaid effect does not appear to be convincing and acceptable. It was contended on behalf of the complainant (respondent No. 1) that in the photo copy of the proposal form for insurance brought on record there appears nothing to show that any constructed building or godown had been insured rather what has been written in the proposal form is really postal address of the complainant It was further contended that it is clear from the proposal form that the stock in trade was insured and not the place. This contention was controverted on behalf of the National Insurance Company Ltd. by pointing out that in the proposal form not only the name of the complainant has been mentioned rather Koura Maidan, Raja Bazar, Munger has been mentioned as the business premises of the complainant. A perusal of the photo copy of the proposal form for insurance policy (Annexure-A) lends support to the above contention advanced on behalf of the National Insurance Company Ltd. The proposal form for insurance does not show that Stall No. 79 of Sabji Mandi had been insured. When the stock at Stall No. 79 of Sabji Mandi, Raja Bazar, Munger, had not been insured, it is difficult to accept the contention on behalf of the complainant that the National Insurance Company would be liable to compensate for the alleged loss caused to the complainant.

IT is not disputed that the National Insurance Company Ltd. had sent a Surveyor to assess the loss and the Surveyor had submitted his report. Although the report was not brought on record when the matter was pending before the District Forum, copy thereof is an annexure to the memo of appeal. Since there was no prayer on behalf of the appellant for taking additional evidence in the appeal, it is difficult to look into the report of the Surveyor simply because the same is an annexure to the memo of appeal. IT was contended on behalf of the Bank and the complainant that had the stock at Stall No. 79 of Sabji Mandi not been covered by the insurance policy, the Insurance Company would not have deputed a Surveyor to assess the loss and the conduct of the Insurance Company in deputing the Surveyor for assessing the loss goes to show that even the stock at Stall No. 79 had been insured. In this connection it was pointed out on behalf of the Insurance Company that after getting the claim form from the Bank it was natural for the Insurance Company to depute the Surveyor to ascertain if the Company was liable for the loss, if any, caused to the complainant and after receiving the report the Company repudiated the claim on the ground that the stock at Stall No. 79 of Sabji Mandi had not been insured. IT was further submitted on behalf of the Company that a perusal of the report of the Surveyor annexed with the memo of appeal would show that even the Surveyor had come to the conclusion that the claim was not entertainable. I do not think that simply deputing the Surveyor can be interpreted to mean that stock at Stall No. 79 of Sabji Mandi had also been insured by the Insurance Company. IT would not be out of place to mention here that liability of the Insurance Company is based on the contract of the policy and in the instant case the insurance contract was to cover risk of stock kept at Koura Maidan premises and not else where and that being so, it is difficult to entertain the claim of the complainant (respondent No. 1) against the National Insurance Company.

IN the written statement filed before the District Forum it is the specific case of the Bank that the complainant was at liberty to insure his stock of business with any INsurance Company but the complainant having failed to ensure, the Bank used to get insured the business place of the complainant at Koura Maidan with the National INsurance Company. It was contended on behalf of the Bank that the complainant and the Bank have the relationship of borrower and financier and they have common interest being the joint holder of the policy and as such there is no question of deficiency on the part of the Bank if the stock at Stall No. 79 of Sabji Mandi remained uninsured. It was further contended that in respect of the insurance policy the complainant was not a consumer of the Bank and that being so the claim of the complainant against the Bank is not sustainable. I do not think that borrower (complainant) can throw his responsibility with regard to getting his stock insured on the Bank and claim compensation on that ground from the Bank. Nothing has been brought on record to show that under the terms and conditions of the cash credit loan account facility, it was duty of the Bank to get the stock of the business premises of the complainant insured. In view of the above discussion, both the appeals are allowed. The complaint petition of the complainant (respondent No. 1) is hereby dismissed. Under the facts and circumstances of the case, the parties will bear their cost. Appeals allowed.