National Consumer Disputes RedressalNew India Assurance Co. Ltd. vs Ashok Kumar Yadav & Anr. on 27 January, 2016NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION  NEW DELHI          REVISION PETITION NO. 2795 OF 2013     (Against the Order dated 20/03/2013 in Appeal No. 86/2008        of the State Commission Bihar)        1. NEW INDIA ASSURANCE CO. LTD.  REGIONAL  OFFICE NO.1
JEEVAN BHARTI,
124 CONNAUGHT CIRCUS,  NEW DELHI ...........Petitioner(s)  Versus        1. ASHOK KUMAR YADAV & ANR.  S/O SHRI BHAGWAN CHARAN YADAV,
PROP,
GRAM-PURANA BHIRAHA,
  DISTRICT :  SAMSTIPUR  BIHAR  2. BRANCH MANAGER, CENTRAL BANK OF INDIA,  BHIRHA, THANA-ROSRA,   DISTRICT- SAMSTIPUR  BIHAR ...........Respondent(s)BEFORE:      HON'BLE MR. JUSTICE AJIT BHARIHOKE, PRESIDING MEMBER    HON'BLE MRS. REKHA GUPTA, MEMBER 
      For the Petitioner     :      Mr. Pradeep Gaur, Advocate       For the Respondent      :     For the Respondent No.1	:	Mr. S.K. Singh, Advocate
  For the Respondent No.2	:	Ms. Archana Gupta, Advocate  
 Dated : 27 Jan 2016  	    ORDER    	    

 JUSTICE AJIT BHARIHOKE, PRESIDING MEMBER1.       This revision is directed against the order of the Bihar State Consumer Disputes Redressal Commission, Patna (in short, "the State Commission") dated 20.3.2013 in first appeal No.86/2008.2.       Briefly stated, facts relevant for the disposal of the revision petition are that the respondent Ashok Kumar Yadav filed a consumer complaint in District Forum, Samastipur alleging that he took a loan of Rs.87,500/- from respondent No.2 Bank under Prime Minister Employment Scheme. With the said amount the complainant started his Kirana business. The complainant used to send his monthly stock statement to the respondent No.2 bank. As per the terms and conditions of the loan, shop of the complainant was got insured with the petitioner for a sum of Rs.1,00,000/- through opposite party No.2 bank. The insurance premium was paid by opposite party No.2 bank to the petitioner and insurance policy was issued for the period w.e.f. 1.5.2002 to 30.4.2003. Likewise, the insurance premium for the period 2003 to 2004 and 2004 to 2005 was paid by opposite party No.2 bank to the petitioner on behalf of the complainant. On 15.7.2004 due to flood on account of breaking of river dam the goods lying in the shop of the complainant were damaged resulting in loss to the extent of Rs.1,00,000/-. The intimation of loss suffered due to flood was given to the petitioner as well as opposite party No.2 bank. The petitioner appointed a surveyor for assessment of loss. However, despite of several reminders the claim was not settled and ultimately the petitioner insurance company vide its letter dated 28th July, 2006 repudiated the insurance claim on the ground that on the relevant date i.e. 15.7.2004 there was no insurance policy in existence and the policy issued in favour of the complainant was effective w.e.f. 27.7.2004 to 26.7.2005. According to the complainant, the petitioner insurance company received insurance premium from opposite party No.2 bank on 15.7.2004. Therefore, the loss caused due to flood on 15.7.2004 was within the policy period. Thus, being aggrieved of repudiation of claim, respondent No.1/complainant filed the consumer complaint.3.       Opposite party No.2 bank in its written statement pleaded that the insurance premium was paid by way of a bank draft No.25/258 dated 6.7.2004 for a sum of Rs.46514/- to the agent of the insurance company Nilambar Jha, who presented the bill for insurance premium in respect of the insurance policies relating to several account holders including the complainant.4.       Opposite party No.1 in its written statement alleged that on the date of flood i.e. 15.7.2004 there was no insurance policy in existence and actually the insurance policy was issued on 27.7.2004 effective w.e.f. 27.7.2004 to 26.7.2005 on the receipt of premium through bank draft dated 6.7.2004. According to the petitioner the agent Nilambar Jha deposited the bank draft with the insurance company on 26.7.2004 vide entry dated 1013 dated 26.7.2004.5.       The District Forum on consideration of pleadings of the parties and the evidence allowed the complaint and ordered thus: -"Therefore, the opposite party No.1 is directed to pay Rs.100,000/- towards claim amount with interest @ 12.5% w.e.f. August, 2004 to December, 2007 amounting to Rs.42,707/- including Rs.5000/- towards damages and Rs.1000/- towards cost of litigation this totaling to Rs.1,48,707/- to plaintiff within a period of 30 days through District Forum. Since the plaintiff is an unemployed youth, therefore, the payment of interest is waived off and the opposite party No.2 is directed to recover only the balance principal amount. The plaintiff is directed to deposit the balance principal amount with the bank on receipt from the opposite party No.1. In case the order is not complied with in the stipulated period than the amount of Rs.1,48,707/- shall carry interest @ 12.5% from the date of order."6.       Being aggrieved of the order of the District Forum, the petitioner insurance company preferred an appeal and the State Commission on consideration of record and the submissions of the parties, disposed of the appeal affirming the order of the District Forum with following modifications: -"We have heard the learned counsel for the respondent. From the impugned order it appears that the complainant was absolved from paying any interest to the bank and in the same, he was directed to received interest @ 12.5% from the insurance company. It goes against the norms of natural justice. There should be some payment of interest to the bank in case interest is received by the complainant and then complainant in the same manner, should also deposit the principal, which  he has taken by way of loan from the bank alongwith accrued interest at the rate, which he received. However, this rate of interest is now revised @ 10% per annum, which is received by the complainant from the insurance company as stated in the impugned order and he should also deposit the loan amount taken from the bank with the same amount of interest."7.       Learned Shri Pradeep Gaur, Advocate for the petitioner has contended that the State Commission has committed a grave error in going on tangent and failing to appreciate that there was no privity of contract between the insurance company and the respondent/complainant as on the date of loss i.e. 15.7.2004 there was no insurance cover in existence. It was further contended that the State Commission has failed to appreciate that the insurance company received the insurance premium by demand draft No.25/258 dated 6.7.2004 on 27.7.2004 and, therefore, the risk coverage of the complainant started w.e.f. 27.7.2004 only and as such insurance company was not liable to indemnify the complainant for the loss suffered by him on 15.7.2004. It is contended that if at all anyone has been negligent, it is respondent no.2 Bank.8.       Petitioner and OP No.2 on the contrary have argued in support of the impugned order.9.       We have considered the rival contentions and perused the record.  The only issue which needs determination in this revision petition is whether or not there was a valid insurance policy in favour of the petitioner on 15.072004, the date on which damage to the goods lying in the shop of the petitioner was caused due to flood.  It is not disputed that previous insurance policy pertaining to the shop of respondent no.1 had lapsed before 15.07.2004 and the fresh insurance policy was issued in favour of the respondent on 26.07.2004.  Thus, it can be safely inferred that on the date of incident, the said shop was not insured.  As such, the insurance company was justified in repudiating the claim.10.     Respondent no.1 complainant has contended that respondent no.2 had debited the insurance premium to his account and a draft pertaining to the insurance premium for renewal of the insurance policy was admittedly issued by the bank on 06.07.2004.  It is contended on behalf of the petitioner that if the insurance company is not liable, then respondent bank is guilty of negligence and deficiency in service by delaying the delivery of insurance premium by way of said bank draft to the insurance company and in that eventuality respondent no.2 should be asked to compensate the complainant.11.     OP No.2 bank has placed on record of the District Forum a photocopy of the  receipt pertaining to the deposit of insurance premium vide above referred draft for Rs.46,514/- against collective premium of various customers including the respondent no.1. As per scroll no. 1013 dated 26.07.2004, the demand draft was received by the Insurance Company on 26.07.2004 and on the same day cover note was issued in favour of the respondent no.1 complainant.  Thus, it is clear that the draft had reached the insurance company on a later date.12.     Learned counsel for respondent no.2 bank has taken a plea that actually agent of the insurance company had visited the bank on 06.07.2004 and raised an invoice of Rs.9345/- on the letter head of the petitioner insurance company for premium pertaining to seven customers including respondent no.1.   It is contended that pursuant to the aforesaid invoice, draft of Rs.46,514/- was prepared in favour of the insurance company and delivered to the agent of the insurance company.  Therefore, the plea of the insurance company that premium was received much later is not acceptable.13.     In order to test the plea of respondent no.2, we have perused the photocopy of the aforesaid invoice raised on the letter head of the insurance company dated 06.07.2004.  On reading of this invoice, we find that this invoice is in respect of the insurance premium to be paid in respect of seven insured persons including respondent no.1.  The total bill raised by this invoice is to the tune ofRs.9345/-.  Perusal of the copy of the transfer credit slip for preparation of the demand draft would show that aforesaid premium is part of the amount of Rs.46,514/- for which draft was made.  In order to succeed in its argument, respondent bank was required to prove that aforesaid demand draft which included the payment of insurance premium was actually delivered to Nilambar Jha on 06.07.2004.  Respondent no.2 has failed to show any cogent evidence in this regard.  Therefore, we find it difficult to believe that the draft dated 06.07.2004 was actually delivered to and received by the petitioner insurance company on 06.07.2004 itself and not on 26.07.2004, the date mentioned in the above noted scroll entry for payment of premium vide draft for Rs.46,514/-. Thus, in our considered view, respondent no.2 bank has committed deficiency in service in delaying the payment of premium to the insurance company after having debited the same to the account of the respondent no.1 complainant despite of the fact that draft for payment of premium was made on 06.07.2004.  This negligence amounts to deficiency in service which has resulted in the repudiation of insurance claim.14.     In view of the above, it is clear that foras below have not appreciated the facts correctly.  Therefore, the impugned order cannot be sustained.  We accordingly allow the revision petition, set aside the impugned order and direct respondent no.2 to pay to the respondent no.1 complainant a sum of Rs.1,48,707/- with 12.5% from the date of the order of the District Forum as compensation for deficiency in service on its part.  Revision  Petition is disposed of accordingly.......................J  AJIT BHARIHOKE  PRESIDING MEMBER  ......................  REKHA GUPTA  MEMBER