MOHD.PARVEZ ALAM vs Branch Manager, National Insurance Co. Ltd.

THIS revision petition arises out of the order of the State Commission, Bihar, whereby the State Commission dismissed the complaint. The facts in brief which lead the complainant to file a complaint are as under : The case of the complainant is that he holds a cash credit account with the State Bank of India, Bara Bazar, Munger upto the limit of Rs. 1 lac and his stocks used to be insured by the Bank with his consent. The complainant had an insurance policy for Rs. 2,50,000/- with the National Insurance Company. On and between 7.12.1992 and 13.12.1992 the stock of the complainant at 79, Raja Bazar, Mandi, Munger was looted by the miscreants for which an FIR was lodged and the Bank was informed by the complainant to claim compensation from the Insurance Company. The Insurance Company repudiated the claim on the ground that the business place of the complainant was Kaura Maidan, Mohalla and not Stall No. 79, Raja Bazar, Mandi, Munger and the later place of business was not covered by the policy of insurance. The contention of the complainant is that he had already informed the Bank about the place of business and location of stock as Stall No. 79, Raja Bazar, Mandi, Munger and the Bank should have informed the Insurance Company and if it had failed to do so it was liable. He has, therefore, made the Bank liable for the loss. The plea of the Bank is that they had provided the address of the business place at Kaura Maidan. The stand taken by the Insurance Company is that Stall No. 79, Raja Bazar, Subzi Mandi, Munger had not been insured under the insurance policy, hence it was not liable for the loss incurred by the complainant.

UPON hearing both the sides, the District Forum has held that the complainant had informed the Bank the complainant''s business place was also situated at Stall No. 79, Raja Bazar, Subzi Mandi, Munger, vide his letter dated 2.7.1992. The plea put forward by the Bank before the District Forum was that the Agent of the Insurance Company was given both the addresses, i.e. at Kaura Maidan and Stall No. 79 at Subzi Mandi, Raja Bazar, but the latter place of business was not mentioned in the policy by the Agent of the Insurance Compnay and hence it was not liable for the loss sustained by the complainant. The District Forum held that since the complainant had paid for the insurance premium and had advised the Bank regarding the place of business in Subzi Mandi and the Bank failed to ensure that this later place of business was mentioned in the policy, it is a serious deficiency on the part of the Bank and the Bank was held liable for the loss caused to the complainant. The Insurance Company, opposite party No. 1 before the District Forum, took the stand that since the later address was not mentioned in the policy, they have rightly repudiated the claim and the policy did not cover the stock at the later address. The District Forum did not believe the contention of the Insurance Comany that the latter address was not mentioned in the policy. It is pertinent to mention here that the District Forum had observed in its order that the original insurance policy had not been filed by the opposite parties and that the original policy might have been withheld to conceal any provision by which the dispute can be settled by making a reference to arbitration, etc. The District Forum went deep into the matter. After having heard both the sides and adverted to the correspondence exchanged between the parties, it is held that the opposite parties are jointly and severally liable to pay a sum of Rs. 70,200/- compensation for the deficient and faulty services rendered by them with interest at the rate of 18% p.a. from the date of the institution of the claim i.e. 13.2.1993 till realisation, Rs. 2,000/- as compensation for mental harassment and Rs. 1,000/- as expenditure incurred by him for instituting these proceedings. Feeling aggrieved by the order of the District Forum, the opposite parties went in appeal to the State Commission which upset the order of the District Forum and allowed the appeal. Now, the complainant has come in revision before us. The State Commission should not have ignored the fact of the Bank having communicated to the Insurance Company both the addresses. Omission of one of these two addresses in the policy itself constituted a deficiency in service, particulary when it had charged full premium payable for such policies. For that reason the impugned order as against the Insurance Company cannot be sustained and is set aside to that extent. In this case it was brought to our notice by the Counsel for the Insurance Company that the Surveyor had assessed the loss at Rs. 31,900/- and which amount was acceptable to the complainant. Therefore, the amount to be awarded should have been Rs. 31,900/- with interest which should have been fixed at the rate of 12% to accrue from two months after the date of Surveryor''s report, and not 18% with costs of Rs. 1,000/-. We order accordingly. We are informed that substantial amount is due and payable to the Bank by the petitioner. In that view of the matter, the amount awarded herein shall first be paid to the Bank and the surplus, if any, left after satisfaction of the Bank, shall be paid to the complainant/petitioner. The revision petition is disposed of in the above terms. Revision Petition disposed of.