Oriental Insurance Co. Ltd. vs C.NIRMALA

OF the two opposite parties against whom an award has been passed by the District Forum, this appeal is filed by the 2nd opposite party M/s. Oriental Insurance Company Ltd. The 1st opposite party is Andhra Bank, Bangalore Road, Vellore. The complainant deposited a sum of Rs. 10,000/- with the 1st opposite party Andhra Bank in pursuance of a Mediclaim Scheme announced by the Bank. On that deposit, the Bank got Mediclaim Insurance for the complainant for the period from March, 1992 to 31st December, 1992. Thereafter, the Insurance cover was not renewed. The complainant was intimated only on 15.2.93 by the 1st opposite party stating that 2nd opposite party Insurance Company was not willing to renew the insurance. Upon this, the complainant was shocked and had suffered mental pain. Alleging deficiency in service on the part of the 1st and the 2nd opposite parties the complaint was filed.

BOTH the opposite parties resisted the complaint stating that there was no deficiency in service on the part of either of them. The District Forum found that both the opposite parties were deficient in service, and it passed an order of award directing them to renew the Mediclaim Insurance from 1.1.93 for one year and also awarded damages of Rs. 1000/- besides costs of Rs, 200/- It is against this order the 2nd opposite party-Insurance Company has filed this appeal.

It is contended that the Insurance Company had to give up the Scheme because it sustained heavy loss and in this regard it had written to the 1st opposite party Bank. They cannot be compelled to renew the insurance and they are not bound to do so. It is argued by the learned Counsel for the appellant-2nd opposite party that there is no privity of contract between them and the complainant which binds the 2nd opposite party that it shall renew the policy after the policy was over on 31.12.1992. From the records, it is seen that the 1st opposite party is bound to renew. But the 2nd opposite party has written to it that it was not prepared to renew the policy. Therefore, it appears that the 1st opposite party was helpless. However it may be, there is no appeal filed by the 1st opposite party against the award. In this view of the matter, we hold that the award passed by the District Forum against the 2nd opposite party cannot be sustained as correct.

ACCORDINGLY, we allow the appeal, set aside the order of the District Forum only as against the 2nd opposite party-Insurance Company. There will be no order as to costs. Certainly the complainant will be at liberty to proceed against the 1st opposite party-Bank to execute the award. Appeal allowed.