State Consumer Disputes Redressal Commission
Vikas Sahakari Bank Ltd., Solapur vs United India Insurance Co. Ltd. on 10 February, 2012
UNDER CERTIFICATE OF POSTING
BEFORE THE
HON'BLE STATE CONSUMER DISPUTES REDRESSAL
COMMISSION, MAHARASHTRA, MUMBAI
First Appeal
No. A/07/753
(Arisen out
of Order Dated 14/05/2007 in Case No. 278/2004 of District Solapur)
1. Vikas Sahakari Bank Ltd., Solapur
Balives, Jaju Chowk, Solapur - 413 002 Through its
Manager, Shri. Pandurang Shrirang Mantri, R/o. as above,
Solapur, M.S.
...........Appellant(s)
Versus
1. United India Insurance Co. Ltd.
Jain Boarding Complex, 13, Budhawar Peth, Balives,
Solapur - 413 002 (M.S.) - Summons / Notice be served on the Branch
Manager
...........Respondent(s)
BEFORE:
Hon'ble Mr. S.R. Khanzode PRESIDING MEMBER
Hon'ble Mr. Narendra Kawde MEMBER PRESENT:
Adv.V.C.Dargad for the appellant present.
Adv.H.G. Misar for the respondent present.
O R D E R Per Mr.Narendra Kawde Honble Member:(1)
This appeal is directed against the order dated 14.05.2007 in Consumer Complaint No. 278/2004, (Vikas Sahakari Bank Ltd. V/s. United India Insurance Co. Ltd.) passed by the District Consumer Disputes Redressal Forum, Solapur (the District Forum in short). By way of the said order the District Forum directed the Respondent Insurance Company to pay `72,000/- within a period of 30 days to the Appellant Bank as settlement of insurance claim preferred by the Appellant Bank, failing which 12% interest was ordered to be paid.
Aggrieved and dissatisfied with the impugned order of the District Forum the Appellant Bank has preferred this appeal on the ground that the Opponent Insurance Company has failed to reimburse the amount of `14,41,273/- stolen by the Head Cashier from the Bank. The surveyor of the Respondent wrongly recommended to settle the claim of `1,00,000/- on account of basic sum insured under the policy.(2)
The case in brief is that the Appellant Bank has subscribed to Bankers Indemnity Insurance Policy for a period from 01.04.2002 to 31.03.2003 for insured sum of `2,51,00,000/- issued by the Opponent Insurance Company. One Mr.Sanjay Daga was working as Head Cashier in the Bank. On 21st September, 2002 it was noticed that there was shortage of cash to the extent of `14,41,273/-. Mr.Sanjay Daga had proceeded on leave, the Appellant Bank has filed F.I.R. with the police about theft of cash of `14,41,273/- against Shri Sanjay Daga, the head cashier of the Bank. The Appellant Bank preferred claim with the Opponent Insurance Company for reimbursement of the lost amount of `14,41,273/-. However, for pretty long time of one year and eight months there was no response and ultimately, the Opponent Insurance Company offered an amount of `72,000/- as compensation and insisted signing of voucher in advance before receiving the said amount as basic sum insured. The Appellant decided to receive the said amount but under protest keeping the claim open for rest of the amount. However, the Opponent Insurance Company refused to pay even `72,000/-. Therefore, aggrieved with the repudiation of the claim amount and inordinate delay the Appellant Bank preferred consumer complaint before the District Forum. The District Forum awarded an amount of `72,000/- as against the entire claim of `14,41,273/- by holding that the Appellant bank is eligible to receive basic sum insured amount of `1,00,000/- as the theft occurred on the premises of the Appellant Bank. Dissatisfied and aggrieved with this impugned order the Appellant Bank has preferred this appeal.(3)
Heard.Ld.Advocate of both the parties, perused the record.
The Ld.Advocate for the Appellant Bank submitted that the policy issued by Opponent Insurance Company covering the total risk of `2,51,00,000/-, which covers Basic Sum Insured of `1,00,000/-, additional sum insured on premises of `2,00,00,000/-, thirdly, additional sum insured on transit `50,00,000/-. The terms and conditions of the policy defines the provisions of on premises and in transit, however, there is no definition to Basic Sum Insured. The Appellant Bank has already registered F.I.R. of theft against the said Shri Daga, Head Cashier of the Bank. Though this policy provides Insurance Cover for theft of premises committed by dishonest employee of the Appellant Bank, yet the claim of the Appellant bank has not been settled as per report of the surveyor of the Opponent Insurance Company and as recommended by the surveyor only an amount of `72,000/- was offered under the provisions of Basic Sum Insured under the policy. The Appellant Bank has subscribed insurance premium for all those contingencies referred in the policy. The Ld.Advocate of the Respondent Insurance Company submitted that the claim to the extent of `72,000/- was rightly decided by the Opponent Insurance Company as there was criminal breach of trust by the employee of the Appellant Bank. Such a contingency is not covered under the policy terms and therefore, the amount claimed by the Appellant Bank has not been considered for settlement of claim.(4)
The policy terms as rightly submitted by the Ld.Advocate of the Appellant provides the definition of on premises and in transit. However, the definition of Basic Sum Insured has not been mentioned in the policy terms.
On enquiry with the Ld.Advocate of the Opponent Insurance Company about the definition of Basic Sum Insured, no explanation could come forward. The policy terms provided for coverage of loss of money by reason of dishonest or criminal act of the employee of the insured. Said condition D reads as below:
DISHONESTY: by reason of the dishonest or criminal act of the employee(s) of the insured with respect to the loss of Money and/or Securities wherever committed and whether committed singly or in connivance with other;
The Ld.District Forum heavily relied on the submission of the Opponent Insurance Company treating the loss of cash covering under basic sum insured and wrongly awarded the amount of `72,000/- by way of the impugned order. Obviously the terms and conditions under the policy are required to be read in right perspective.(5)
Undisputed facts are that during the validity period of the Bankers Indemnity Policy the theft of `14,41,273/- was noticed. The Appellant Bank proceeded to take appropriate steps to lodge F.I.R. against their head cashier allegedly involved in the theft. There is no dispute about loss of cash of `14,41,273/-. There was inordinate delay on the part of the Opponent Insurance Company to consider the claim of the Appellant Bank. Appellant Bank though was willing to accept the amount of `72,000/- under protest. The Ld.District Forum has erred in holding that Appellant Bank is entitled to receive amount equal to basic sum insured under the policy though the entire loss of insured money is covered due to dishonest or criminal act of the employee as provided under policy clause D. Thus, we find appellant has substantive case to claim the insured loss of money under the policy as the insurance under the policy provides such cover to get the contingencies of loss of money due to dishonest or criminal act of employee. Therefore, the impugned order passed by the District Forum needs to be set aside. We hold accordingly and proceed to pass the following order:
O R D E R
(i) Appeal is partly allowed.
(ii) The Opponent, United India Insurance Co. Ltd. is directed to pay an amount of `14,41,273/- together with an interest @9% p.a. effective from 17/09/2004.
(iii) In the given circumstances, parties to bear their own costs.
Pronounced on 10th February, 2012.
[Hon'ble Mr. S.R. Khanzode] PRESIDING MEMBER [Hon'ble Mr. Narendra Kawde] MEMBER ep