State Consumer Disputes Redressal Commission
L. Venkatarami Reddy vs Andhra Pragathi Grameena Bank on 9 May, 2012
A BEFORE THE A.P. STATE CONSUMER DISPUTES REDRESSAL COMMISSION AT HYDERABAD. FA 1144 of 2008 against C.C. 4/2007, Dist. Forum, Ananthapur Between: L. Venkatarami Reddy S/o. L. Lakshmi Reddy R/o. S. Thimmapuram Village Putlur Mandal Ananthapur Dist. *** Appellant/ Complainant And Andhra Pragathi Grameena Bank (Sree Anantha Grameena Bank) Rep. by its Branch Manager Putlur, Ananthapur Dist. *** Respondent/ Opposite Party FA 1145 of 2008 against C.C. 5/2007, Dist. Forum, Ananthapur Between: 1) S. Anki Reddy (Died) Rep. by LRs. 2) S. Pedda Bala Anki Reddy S/o. S. Anki Reddy 3) S. Chinna Bala Anki Reddy S/o. S. Anki Reddy 4) S. Viswanatha Reddy S/o. Anki Reddy All are R/o. S. Thimmapuram (V) Putlur (M), Ananthapur Dist. *** Appellants/ Complainants And Andhra Pragathi Grameena Bank (Sree Anantha Grameena Bank) Rep. by its Branch Manager Putlur, Ananthapur Dist. *** Respondent/ Opposite Party FA 1146 of 2008 against C.C. 6/2007, Dist. Forum, Ananthapur Between: B. Jayarami Reddy S/o. B. Konda Reddy R/o. S. Thimmapuram Village Putlur Mandal Ananthapur Dist. *** Appellant/ Complainant And Andhra Pragathi Grameena Bank (Sree Anantha Grameena Bank) Rep. by its Branch Manager Putlur, Ananthapur Dist. *** Respondent/ Opposite Party FA 1147 of 2008 against C.C. 7/2007, Dist. Forum, Ananthapur Between: L. Lakshmi Reddy S/o. Pedda Obula Reddy R/o. S. Thimmapuram Village Putlur Mandal Ananthapur Dist. *** Appellant/ Complainant And Andhra Pragathi Grameena Bank (Sree Anantha Grameena Bank) Rep. by its Branch Manager Putlur, Ananthapur Dist. *** Respondent/ Opposite Party FA 1148 of 2008 against C.C. 8/2007, Dist. Forum, Ananthapur Between: B. Narasaiah, S/o. Pullaiah R/o. Pothireddipalli (V) Putlur Mandal Ananthapur Dist. *** Appellant/ Complainant And Andhra Pragathi Grameena Bank (Sree Anantha Grameena Bank) Rep. by its Branch Manager Putlur, Ananthapur Dist. *** Respondent/ Opposite Party FA 1149 of 2008 against C.C. 9/2007, Dist. Forum, Ananthapur Between: S. Lakshminarayana Reddy S/o. Lakshmi Reddy R/o. S. Thimmapuram Village Putlur Mandal Ananthapur Dist. *** Appellant/ Complainant And Andhra Pragathi Grameena Bank (Sree Anantha Grameena Bank) Rep. by its Branch Manager Putlur, Ananthapur Dist. *** Respondent/ Opposite Party FA 1150 of 2008 against C.C. 10/2007, Dist. Forum, Ananthapur Between: S. Rajeswari, S/o. Late Nageswara Reddy R/o. S. Thimmapuram Village Putlur Mandal Ananthapur Dist. *** Appellant/ Complainant And Andhra Pragathi Grameena Bank (Sree Anantha Grameena Bank) Rep. by its Branch Manager Putlur, Ananthapur Dist. *** Respondent/ Opposite Party FA 1151 of 2008 against C.C. 11/2007, Dist. Forum, Ananthapur Between: B. Sree Ranganayakulu @ B. Ranganayakulu S/o. Pullaiah R/o. S. Thimmapuram Village Putlur Mandal Ananthapur Dist. *** Appellant/ Complainant And Andhra Pragathi Grameena Bank (Sree Anantha Grameena Bank) Rep. by its Branch Manager Putlur, Ananthapur Dist. *** Respondent/ Opposite Party Counsel for the Appellants: M/s. N. Aswatha Narayan Counsel for the Resp: M/s. K. Srinivasa Murthy CORAM: HONBLE SRI JUSTICE D. APPA RAO, PRESIDENT SMT. M. SHREESHA, MEMBER
& SRI S. BHUJANGA RAO, MEMBER WEDNESDAY, THE NINETH DAY OF MAY TWO THOUSAND TWELVE Oral Order: (Per Honble Justice D. Appa Rao, President) ***
1) These batch of appeals eight in number are preferred by the un-successful complainants against the order of dismissal of their claims against the bank for recovery of crop loan insurance together with compensation and costs.
2) Though separate orders were passed in each of these complaints filed by the farmers, in the light of the fact that common questions of fact and law arise, we deem it fit that a common order can be passed in all these matters.
3) The case of the complainants in brief is that they are the agriculturists availed agricultural loans and got the groundnut crop insured with Agricultural Insurance Company of India Ltd. (herein after called the insurance company) and premium was debited from their accounts.
While so, the groundnut crop that was raised was failed and it was informed to the opposite party bank, which in turn directed them to wait for one month on the ground that the Government of Andhra Pradesh, announced crop loss compensation at 46% of the loan amount.
Despite expiry of the period, they did not pay, and therefore each of them claimed various amounts towards crop loss together with compensation and costs.
4) The opposite party bank resisted the claim. While admitting that the complainants have availed crop loan from its bank as per rules, and that the Government declared the percentage of the loss of the crop it alleged that the insurance company had to pay the amount to the bank for crediting the same to the borrowers accounts. The complaints are bad for non-joinder of insurance company as a necessary party. It had collected/debited the premium from the complainants accounts, paid to the insurance company. However, while preparing the list of borrowers and the name of the village there was a mistake occurred. Name of the village where lands situated was not mentioned. Since the compensation has been declared basing on the village level there was some delay in settlement of claims. It was a human error in feeding the particulars of crop insurance which resulted in non-payment of declared compensation. Immediately after coming to know of it the bank had informed the insurance company which promised rectification of the mistake. The same was pending before the Head Office at New Delhi. Soon after obtaining permission the amounts would be credited to the complainants loan accounts. In fact the entire amount debited from the loan accounts of the complainants has been sent to the Regional Office, Ananthapur which in turn sent to Regional Office of Agriculture Insurance Company at Hyderabad. While the complainants were residents of Thimmapuram village of Gandhipadu panchayat and the lands are situated at Senagalaguduru. Since there was a mistake the amounts could not be credited.
However, the claims were pending for consideration. As soon as amounts were received the same would be credited to the complainants loan accounts, and therefore prayed for dismissal of the complaints with costs.
5) The complainants in proof of their case filed their affidavit evidence and got Exs. A1 to A4 marked while the opposite party bank filed the affidavit evidence of its Branch Manager and got Exs. B1 to B6 marked .
6) The Dist. Forum after considering the evidence placed on record opined that though the complainants were covered by insurance company, the claims have to be settled by the insurance company, and it was a necessary party, and without its presence the complaints cannot be decided on merits, and therefore the complaints were dismissed, however, without costs.
7) Aggrieved by the said decision, the complainants preferred the appeals contending that the Dist. Forum did not appreciate either fact or law in correct perspective. Evidently the insurance amount was not paid though there was loss of crop due to mistake of the opposite party bank in feeding the particulars in the computer.
It is not as though the insurance company denied their claims. What all represented was to wait in order to send the amount. Since they did not take insurance policy directly they cannot claim from the insurance company they being not parties to the contract. Therefore they prayed that the complaints be allowed.
8) The point that arises for consideration is whether the order of the Dist. Forum is vitiated by mis-appreciation of fact or law?
9) It is an undisputed fact that the complainants are farmers availed agricultural crop loan from the opposite party bank for their lands are situated at Senagalaguduru. It is also not in dispute that when the crops had failed for the notified groundnut crop, they made claims to the opposite party bank. It is also not in dispute that the crop insurance was given at 46% of the loan amount to the ryots who have lands in Senagalaguduru village on the basis of failure of groundnut crop. However, the complainants could not get the said amount in view of the mistake committed by the bank.
10) The very opposite party bank admits that there was a mistake in feeding the particulars in the computer, and therefore the amounts were not paid to them. In fact the bank itself admits that on the claims made by the complainants under the scheme the insurance company itself asked them to rectify the mistake on which it could credit the amounts to the loan accounts of the complainants. We excerpt the admission made by the bank in this regard:
. While preparing the co-related list of the borrower and his village, some mistake occurred and the name of the village where the land is situated is not mentioned, but the village where complainant is residing was mentioned, and since compensation has been declared basing on village level, there was some delay in settlement of insurance claim which is not intentional. Therefore due to human error in feeding the particulars of crop insurance, to computer resulted in non-payment of declared compensation and immediately when the respondent bank came to know about the mistake crept in the record, this respondent through its Regional office requested the crop insurance authorities to rectify the mistake in the data particulars of village since, the insurance is payable village-wise but previously it was the mandal unit for declaring the loss of crop. In fact the respondent submits that the crop insurance office of Hyderabad in turn sought for the permission to rectify the data and to pay the amount and the proceedings are pending before the Head Office, New Delhi. Soon after obtaining permission and amount, the same will be credited to petitioners accounts.
In Ex. B5 the bank has admitted With reference to the above, we hereby confirm that the particulars furnished in the statement for arriving the revised claims are in order and they are inconformity with the changes submitted by us except the following :
The changes in the village names submitted by us vide our Lr. Ref. No. 303/ADV/2006-07 Dt. 9.8.2006 in respect of Peddamanthur and Talamarla branches are not included in the above statement.
11) Up till now, the insurance company, as promised did not pay the same to the opposite party bank, in order to credit the amount to the loan accounts of the complainants. The contention of the opposite party bank was that it was not liable to pay the amounts, as it was only an agent, and the insurance company has to pay and it has no role to pay in this regard.
12) Ex. A5 is the National Agricultural Insurance Scheme. Para 9 (A) of the scheme is relevant to our case in regard to role & responsibilities of financial institutions, under heading special conditions for FIs/Nodal Banks/Loan Disbursing Point, the following is mentioned at point no.5:
In case a farmer is deprived of any benefit under the Scheme due to errors/omissions/commissions of the Nodal Bank/Branch/PACS, the concerned institutions only shall make good all such losses.
Therefore it is the bank that shall make good the losses. In fact the bank can as well claim from the insurance company, more so, when it has admitted its liability.
13) In related cases, when bank was mulcted its liability for its mistake, this Commission as well as National Commission, have consistently upheld the liability of the bank. It is too late a day to contend that the Consumer Forum has no jurisdiction and that the civil court is proper forum for adjudication in these matters. At the cost of repetition we may state had the bank furnished correct information, the insurance company would have paid the amount to the complainants. In the light of clause 5 which we have referred above necessarily the bank was liable to pay the amount. The Dist. Forum obviously went wrong in stating that the insurance company was a necessary party to the proceedings. The ryots are not parties to the agreement between bank and insurance company. They are beneficiaries. The poor farmers cannot be directed to approach the insurance company for recovery of the compensation. It is for the bank to pay it to them, and collect the same from insurance company. In the light of terms of the scheme, the bank had to make good loss. Therefore the order of the Dist. Forum is set-aside.
14) In the result the appeals are allowed setting aside the order of the Dist.
Forum. Consequently the complaints are allowed directing the opposite party bank to pay crop insurance at 46% of the loan amount, and adjust it towards their loan account. The complainants are also entitled to costs of Rs. 5,000/- each. Time for compliance four weeks.
1) _______________________________ PRESIDENT
2) ________________________________ MEMBER
3) ________________________________ MEMBER 09/05/2012 *pnr UP LOAD O.K.