State Consumer Disputes Redressal Commission
Vadde Derangula Ramulamma And Another vs Andhra Pragathi Grameena Bank, And ... on 10 November, 2014
A.P. STATE CONSUMER DISPUTES REDRESSAL COMMISSION: AT HYDERABAD F.A.NO. 839 OF 2013 AGAINST THE ORDER IN C.C. NO. 7 OF 2013 OF DISTRICT FORUM, ANANATHAPURAM Between 1. Vadde Derangula Ramulamma W/o late D.Ramanjineyulu, 2. Vadde Derangula Hanumanthu S/o late D.Ramanjineyulu, Both are residing at Pichireddy Kottala village, Ramagiri mandal, Ananthapur District. Appellants/complainants And 1. Andhra Pragathi Grameena Bank, Rep.by its Branch Manager, Peruru branch, Ramagiri Mandal, Ananthapur district. 2. Andhra Pragathi Grameena Bank, Rep.by its Chairman, Kadapa Town, Kadapa district. 3. United India Insurance Co., Ltd, Rep.by its Divisional Manager, Ananthapur. Respondents/opposite parties 1 to 3 Counsel for the appellants : Sri K.Maheshwer Rao. Counsel for the respondents : Sri K.Srinivasa Murthy-for R1 & R2. Sri V.Srinivasa Rao for R3. Coram : Sri S.BHUJANGA RAO, Honble Member
And Sri R.LAKSHMINARSIMHA RAO, Honble Member MONDAY, THE TENTH DAY OF NOVEMBER TWO THOUSAND FOURTEEN Oral Order (as per Sri R.Lakshminarsimha Rao, Honble Member) ***
1. The complainants are appellants. The appeal is directed against the order dated 24.07.2013 passed by the District Forum in C.C.No.07 of 2013.
2. The case of the appellants as seen from the averments of the complaint is that the respondents no.1 and 2 obtained insurance policy from the respondent no.3-insurance company for coverage of accident risk on the life of their kisan credit card account holders including the husband of the first appellant who had saving bank account number is 12001/2918 since 29.06.1989 and died in a motor vehicle accident on 19.05.2010 which resulted in registering case in Cr.no. 39 of 2010 with the police, Ramagiri and claim with the respondent no.3 and the respondents failure to settle the claim despite collection of premium of Rs.10/- on 30.03.2010 compelled the appellant to get issued notice dated 15.09.2012 and file the complaint seeking for a sum of Rs.1,00,000/- towards the insurance amount, an amount of Rs.30,000/-towards compensation, conveyance charges of Rs.500/- and loss of interest @24%, Rs.60,733/-.
3. The respondent no.1 and 2 resisted the claim on the premise that they entered into Group Master Policy Agreement with the respondent no.3-insurance company on 01.08.2007 and obtained Consolidated Personal Accident Insurance Policy for coverage of accident risk on the life of their account holders who are issued Kisan Credit Cards and the policy was to be renewed every year on 31st of July on submission of outstanding PKCC accounts along with payment of premium of Rs.5/- from out of each of the Kisan Credit Card Holders Saving Bank Account and Rs.5/- contributed by them for each account holder. The respondent no.2 credited the premium and got the insurance policy renewed for the period 01.08.2009 to 31.07.2010. The respondent no.1 and 2 immediately forwarded the claim to the respondent no.3 and requested the respondent no.3 to settle the claim.
4. The respondent no.3-insurance company has contended that the respondent no.1 and 2 had not deducted the premium from the account of the deceased husband of the first appellant nor did they remit the premium along with the premium of the other account holders and on the date of death of the first appellants husband, the insurance policy was not in force and thus they repudiated the claim. The respondent no.3-insurance company submitted that there is no deficiency in service on its part and prayed for dismissal of the complaint.
5. The first appellant filed her affidavit and the documents, ExA1 to A7. On behalf of the respondents, Branch Manager of the respondent no.1 and Assistant Manager of Respondent No.3 filed their affidavits and the documents, ExB1 to B7. At appellate stage, ExB8 to B11 are marked.
6. The District Forum allowed the complaint on the premise that the insurance policy issued by the respondent no.3-insuarnce company was in force on the date of death of the first appellants husband and failure of the respondent no.3-insurance company to settle the claim amounts to deficiency in service on its part. The District Forum awarded an amount of Rs.50,000/- holding the same as sum assured under the insurance policy and the District Forum has also awarded interest towards compensation for non-settlement of the claim.
7. Feeling dissatisfied by the order of the District Forum, the complainants have filed appeal contending that the District Forum failed to see that the appellants hail from rural area and eke out their livelihood by doing agricultural labour and thus there was drought at the village and as such compensation, conveyance charges and interest @24% p.a. ought to have been awarded and allowed the complaint in toto.
8. The learned counsel for the appellants and the respondent no.1 and 2 have filed written submissions.
9. The points for consideration are:
i) Whether there is deficiency in service on the part of the opposite parties?
ii) To what relief?
10. POINT No.1: The first appellants husband during his life time, operated savings bank account bearing number 12001/2918 with the first respondent-bank and the respondent no.1 and 2 entered into agreement with the respondent no.3-insurance company for the respondent no.3 to cover risk of accident on the life of their account holders who were issued Kisan Credit Cards by the Government. The respondent no.1 and 2 by virtue of the agreement obtained Group Insurance Policy from the respondent no.3-insurance company with effect from 01.08.2009. The criterion for providing insurance coverage is the account holder aged below 70 years should have obtained crop loan from the respondent no.1-bank. The premium agreed to be debited from the account of the kisan credit card account holder is Rs.5/- and the sum assured is Rs.50,000/-.
11. The first appellants husband availed loan under loan account no.PKCC-619/2106 on 11.08.2006 and closed the loan account on 16.07.2009 and he availed fresh loan, an amount of Rs.50,000/- on the same day, i.e., 16.07.2009, under loan account bearing number PLCC/143/2009. The respondent no.1 has stated that it had debited an amount of Rs.5/- from the account of the first appellants husband on 31.07.2009 and credited the amount to the respondent no.3-insurance company. The first appellants husband died on 19.05.2010 during the period the insurance policy in force, viz., the third respondent issued the insurance policy for the period commencing from 01.08.2009 to 31.07.2010.
12. The respondent no.3 repudiated the claim of the appellants on 09.02.2011 on the ground that the respondent no.1 and 2 had not remitted premium for the purpose of renewing the insurance policy. The respondent no.2 through its letter dated 12.03.2010 addressed to the respondent no.3 clarified that the first appellant was availing loan since 2005 from their Shesttur Branch and before it was amalgamated, the Ananthapur branch of the respondent no.3 used to issue the insurance policy till 2007 and later the respondent no.2 had taken consolidated policy covering the KCC borrowers of all their branches in Ananthapur, Kadapa, Nellore and Prakasham districts. Further, the respondent no.2 clarified that for their convenience and the convenience of the respondent no.3, they paid the premium in advance on 01.08.2008 with 5% extra premium to cover the Fresh KCC limits to be sanctioned from 01.08.2008.
13. The respondent no.2 addressed letter, ExB7 and brought to the notice of the respondent no.3 that they had paid premium to the respondent no.3-insurance company whereby the respondent no.3 issued Master Policy bearing no.050900/47/08/43/00000026 and their Kadapa Office addressed letter dated 06.09.2011 to the respondent no.3 that the respondent no.2-bank paid premium for the year,2010-11 and requested the respondent no.3 to settle claim of N.Pedda Nanji Reddy and further clarified to the respondent no.3 that the same parameter is applicable to all the claims arising under the Master Policy issued in favour of the respondent no.2.
14. The respondent no.2 requested the respondent no.3 on 13.03.2013 to settle the claim of the appellants as the claim was pending for about a year and in view of the clarification from their Kadapa office, the respondent no.3 was requested to settle the claim. The respondent no.3 repudiated the claim and later settled the same on receiving clarification from their Kadapa office. The respondent no.3 has again resorted to repudiate the claim on the same ground of non-receipt of the premium pertaining to the first appellants husband from the respondent no.2 and again the respondent no.2 had to remind the respondent no.3 as to what happened to the claim of Ninji Reddy. Thus, repudiation of the claim is not justified.
15. The District Forum awarded an amount of Rs.50,000/- towards the sum assured in terms of the insurance policy . The written arguments are the replica of the ground of appeal which questioned the order of the District Forum for not granting compensation and interest @24% p.a. However, at the time of advancing oral arguments, the learned counsel for the appellants had contended that the respondent no.1 had debited and remitted an amount of Rs.10/- towards premium and the sum assured plus accident benefit the appellants are entitled to is Rs.1,00,000/-. As the respondent had not filed the insurance policy before the District Forum and in view of the claim for Rs.1,00,000/-, this Commission permitted the respondent no.1 to adduce additional evidence such as the insurance policy, Loan Ledger Extract etc.,
16. The Janata Personal Accident Policy as the name indicates was issued to cover risk of accident to the Kisan Card Holders and it is expressly mentioned in the insurance policy that the respondent no.3-insurance company would indemnify the insured in case the insured sustained bodily injury resulting from an accident or such injury within 12 months from the date of its occurrence resulted in death of the insured and compensation payable to each insured is a sum of Rs.50,000/-. The basic criterion for payment of compensation in terms of the insurance policy is injury or death of the insured as a result of an accident. The respondent no.1 and 2 debited an amount of Rs.5/- from the account of the first appellants husband and contributed an amount of Rs.5/- and credited an amount of Rs.10/- for each Kisan Credit Card Holder for the sum assured of Rs.50,000/-.Thus, the contention that the premium paid Rs.10/- would fetch an amount of Rs.1,00,000/- is devoid of any substance and as such is unsustainable.
17. Insofar as the compensation and conveyance charges are concerned, it is to be considered that the District Forum awarded interest @9% p.a. towards compensation. The interest on awarded rate would amount one fourth of the sum assured under the insurance policy. The Honble Supreme Court in State of Gujarath vs Shantilal Mangaldas AIR 1969 SC 634, held the compensation to mean anything given to make things equivalent; a thing given to or to make amends for loss recompense, remuneration or pay, it need not therefore necessarily in terms of money. The phraseology of the Constitutional provision also indicates that compensation need not necessarily be in terms of money because it expressly provides that the law may specify the principles on which, and the manner in which, compensation is to be determined and given . If it were to be in terms of money along, the expression paid would have been more appropriate.
18. The Apex Court held While quantifying damages, consumer forums are required to make an attempt to serve ends of justice so that compensation is awarded, in an established case, which not only serves the purpose of recompensing the individual, but which also at the same time aims to bring about a qualitative change in the attitude of the service provider. Indeed calculation of damages depends on the facts and circumstances of each case. No hard and fast rule can be laid down for universal application. While awarding compensation, a Consumer Forum has to take into account all relevant factors and assess compensation on the basis of accepted legal principles, on moderation. It is for the Consumer Forum to grant compensation to the extent it finds it reasonable, fair and proper in the facts and circumstances of a given case according to established judicial standards where the claimant is able to establish his charge.
19. The Supreme Court held that the compensation to be awarded is to be fair and reasonable. In Charan Singh vs. Healing Touch Hospital and others 2000 SAR (Civil) 935 the Apex Court stressed the need of balancing between the compensation awarded recompensing the consumer and the change it brings in the attitude of the service provider. In the case on hand the lapse on the part of the respondent no.3 was that it had not received premium from the respondent no.1 and 2 in respect of the first appellants husband and the respondent no.1 and 2 clarified them that the amount they paid towards premium has to be considered and not the date of debiting of the amount from the account of the Kisan Credit Card Holder and such being the misunderstanding developed between the respondents no.1 and2 and the respondent no.3, the award of interest @9% is just and reasonable and as such this Commission does not find any reason to interfere with the order of the District Forum. The appeal, as such is liable to be dismissed.
20. In the result, the appeal is dismissed confirming the order of the District Forum. There shall be no separate order as to costs.
MEMBER MEMBER Date:
10.11.2014.