State Consumer Disputes Redressal Commission
The Bicholim Urban Cooperative Bank vs National Insurance Company Limited, on 7 July, 2009
THE STATE CONSUMER DISPUTES REDRESSAL COMMISSION THE STATE CONSUMER DISPUTES REDRESSAL COMMISSION PANAJI GOA Present: Smt. Sandra Vaz e Correia ... Presiding Member Smt. Caroline Collasso ... Member. Complaint No. 13/2003 The Bicholim Urban Cooperative Bank Limited, having its Central Office at Nandanvan Bicholim, Goa, through its Managing Director Shri S.R. Parrikar, r/o Dhavali, Ponda, Goa. Complainant. v/s National Insurance Company Limited, Through its Branch Office, Having office at Town Center, Bicholim, Goa. Opposite Party For the Complainant Shri S. Dhargalkar, Advocate For the Opposite Party Shri U.R. Timble, Advocate Dated:07-07-2009 ORDER
[Per Ms. Caroline Collasso, Member]
1. This is a complaint filed by Bicholim Urban Co-op. Bank Ltd. through its Managing Director against the Opposite Party National Insurance Co. Ltd., for negligence/deficiency rendered by it in its ordinary course of business.
2. It is the case of the Complainant that they entered into a contract with the Opposite Party by subscribing to its Bankers Indemnity Policy, bearing No.270906/99/ 7700001 for a period commencing from 01-04-1999 to 31-03-2000 for a sum of Rs.75,00,000/-. In terms of the said policy, the Complainant was insured by the Opposite Party against the loss of money/security suffered by it, on account of fraud, forgery, alteration, dishonesty of its employees. The Complainant after subscribing to the said policy, complied with all the terms and conditions and paid the regular premiums.
3. One Shri Sureshchandra R. Kapdi, the Complainants employee played a fraud on the Complainants bank. However, the Opposite Party refused to indemnify the Complainant and rejected their claim without assigning any reasons. The Complainant states that due to the fraud played, the Complainant Bank suffered a loss of Rs.50,52,614.50 which included further interest from 01-10-1999. The said fraud was noticed on 25-03-1999 during the subsistence of the policy.
4. The Complainant has elaborated the fraud pertaining to various accounts under difference heads:
a) Overdraft Account No.18 of M/s Gurudrupa Polymers:
The Complainant states that Shri S.R. Kapdi who was working as a Branch Manager of the Complainant branch at Bicholim, opened an overdraft A/c No.18 fictitiously for an overdraft facility of Rs.25 lakhs based on non-existing Fixed Deposit Receipts. This account was opened in the name of M/s. Gurukrupa Polymers. Upon opening, an amount of Rs.13,62,056/- was debited from the said account and credits from the same were passed in overdraft account No.10 of M/s Camat & Co. to the tune of Rs.4,35,415/- and to the overdraft account no.11 of M/s S.S. Multiplast to the tune of Rs.9,26,641/-. After transferring the said amounts in these two above account nos.10 & 11, they were closed. It was noted that while the debit vouchers were signed by Shri S.R. Kapdi and credit vouchers initialed by him, no documents were available in the Complainant/branch records.
The overdraft account no.18 was fictitiously created initially to close the overdraft account of M/s Camat & Co. and M/s S.S. Multiplast. The documents pertaining to these accounts, including ledger folio were not available, being intentionally removed by Sri. Kapdi. Debit balance noticed at the relevant time on account No.18 was Rs.18,42,278.50 with interest thereon from 01-07-1999.
b) Loan FDR 12/76 L.F.9/120 & SB A/c No.12089 of Shri Suryakant S. Tople.
On 10-06-1998, a loan was disbursed in the name of Shri S.S. Tople for Rs.6.35 lakhs against 13 FDRs on face value of Rs.7,32,229/- which were recovered from the drawer of Shri S.R. Kapdi. Documents in respect of this loan were not available in the file of the Complainant Bank. However, there was an unsigned noting on the ledger folio that the documents are with Branch Manager, S. Kapdi 08-02-1997 and none of the Fixed Deposits receipts were discharged by the depositors.
The debit vouchers for Rs.6.35 lakhs was signed on the reverse by Shri S.S. Tople and the proceeds of the loan were credited to Saving Bank A/c No. 12089 of Shri S.S. Tople.
The Complainant , however, stated that the aforesaid transaction cannot be said to be fraudulent at the necessary Fixed Deposits Receipts were kept as security.
On 15-07-1998, a further sum of Rs.2.15 lakhs was disbursed from the same loan account, vide debit voucher prepared and signed by Shri S.R. Kapdi. However, the signature of the borrower on the reverse side was not taken. The said amount was also credited to the Saving Bank account No.12089 of Shri S.S. Tople and vouchers of this transaction were prepared and initialed by Shri Kapdi.
On 12/08/1998, an amount of Rs.10,000/- was credited to the loan account and voucher is shown to be prepared by Shri Kapdi.
On 21-01-1999, an amount of Rs.2.50 lakhs was disbursed from the said loan account.
However, the debit voucher and the contra credit voucher of Saving Bank account No.12089 were not on record. The credit entry of the amount was subsequently found in the Saving Bank account No.12089 of Shri S.S. Tople.
It is further the case of the Complainant that with regard to saving Bank account No. 12089 of Shri Suryakant S. Tople, all the amounts have been debited to the loan FDRs account No.12/76 and credited to the Saving Bank account No.12089 of Shri S. S. Tople and withdrawn by him.
The Complainant states that the above Saving Bank Account No.12089 also shows two credits of Rs.2.45 lakhs dated 30-09-1998 and Rs.5.00 lakhs dated 02-11-1998.
These credits relates to debit made to loan FDR account No.12/174 (IF 9/220) and 12/206 (IF 9/252) of Shri Suhas Keni.
The initial debit in loan FDR 12/76 of Rs.6.35 lakhs appears to be authorized. However, subsequent debits to the same account appear to be unauthorized. The vouchers in respect of debits/credit entry dated 21/11/1999 in the loan and Saving Bank Account respectively have been fraudulently tampered with. Entries on subsidiaries have been made subsequently with the intention of tallying the books of account for the day. Several debit balances are observed in the Saving Bank Account of Shri S.S. Tople amounting to lakhs on certain occasions without approvals from competent authorities.
The complainant states that the total amount involved on these accounts are to the tune of Rs.12,67,226/- with further interest thereon from 01-07-1999. Since the Complainant Bank was holding FDRs of face value of Rs.7,32,229/-, the total amount involved in the fraud in this account was Rs.5,34,997/-.
c) Loan FDR A/c No.12/206 (LF no.9/252) of Shri Suhas Keni.
It is the case of the Complainant that one Shri Suhas Keni deposited an amount of Rs.10 lakhs under various FDRs in July 1997 which were to mature in November 1998. In November 1998, Shri Kapdi approached Shri Keni and got from him all the FDRs discharged, under the pretext of renewing them for a further period of 6 months. However, no renewed FDRs were ever delivered to Shri Keni. Shri Kapdi then took two blank loose cheques signed by Shri Keni under the pretext of withdrawing the interest amount on the FDRs. An amount of Rs.2.00 lakhs in cash was given to Shri Keni by Shri Kapdi as interest.
On 30-09-1998, using the FDRs in the name of Shri Keni, Shri Kapdi created a loan of Rs.2.45 lakhs under account no.12/174. These loan documents were not traceable and vouchers passed by Shri Kapdi crediting the entire proceeds of the loan into a Saving Bank account No.12089 of Shri S.S. Tople. Shri Kapdi again on 02-11-1998, against the same FDR of Shri Keni, created another loan of Rs.5.00 lakhs under account No.12/206 (LF 9/252). These loan documents were also not traceable.
Vouchers for the loan, however, were prepared and signed by Shri Kapdi himself and the entire proceeds of the loan were transferred into Saving Bank A/c No.12089 of Shri S.S. Tople. Balance outstanding in the said loan account was thus Rs.3,22,943/- with interest thereon from 01-07-1999.
On 04-11-1998, a new Saving Bank A/c No.19363 with an initial deposit of Rs.50/- was opened in the name of Shri Suhas Karekar. Account opening form and specimen card were not found in the banks records and particulars of the account holder were not available on the ledger. On the same day, an amount of Rs.64,670/- was credited to the Saving Bank account being interest received on FDR of Shri Suhas Keni & family. On the same day, an amount of Rs.60,000/- was withdrawn.
However, there was no signature of the person receiving the cash, nor cashers signature, nor any mention of the particulars of cash paid on the withdrawal slip. The withdrawal slip seemed to be in the hand writing of Shri Kapdi.
On 16-11-1998, four FDRs belonging to Shri Keni and his family, totaling Rs.4,08,716/- were closed and credited to Saving Bank account No.19363 of Shri Suhas Kerkar. On the same day, an amount of Rs.2,50,249/- was debited to the Saving Bank account No.19363 of Shri Karekar and credited to his loan FDR account No.9/220 of Shri Keni, so as to close the said loan. However, on the same day, an amount of Rs.1.50 lakhs was withdrawn from the Saving Bank Account No.19363, but the withdrawal slip was not signed by the account holder. The said slip, though passed by a junior officer of the Complainant bank, is countersigned by Shri Kapdi and there is no signature of the person receiving the cash and neither cashiers signature and particulars of the cash paid were available on the withdrawal slip.
On 01-12-1998, an amount of Rs.3.00 lakhs was withdrawn from Saving Bank account No.19363 of Shri Karekar vide a cheque written and passed by Shri Kapdi himself.
On 02-12-1998, an amount of Rs.1,71,416/- was credited into the Saving Bank account No.19363 of Shri Karekar, which was in fact proceeds received from the market branch of the Complainant on account of FDR closures of Shri Suhas Keni and Mrs. Sunita Keni. Few days later, i.e. on 05-12-1998, Shri Kapdi withdrew an amount of Rs.2.00 lakhs vide a cheque written and passed by himself from Saving Bank account No.19363 of Shri Karekar.
On 08-12-1998, again an amount of Rs.85,792/- and Rs.65,605/- received from the market branch of the Complainant vide advice No.17920 dated 04-12-1998 bearing the name of Sonal Keni and Shaish Keni were both credited to the loan FDR No.12/206 of Shri Keni.
On 05-12-1998, the FDR maturing proceeds of Shri Keni & fly amounting to Rs.4,08,716/- were credited to the Saving Bank account No.19363 of Shri Karekar. On the same day, an amount of Rs.2.44 lakhs was withdrawn vide a cheque written and passed by Shri Kapdi himself.
On 29-12-1998, an amount of Rs.1.50 lakhs was credited to Saving Bank account No.19363 of Shri Karekar and an amount of Rs.50,000/- was credited in cash to loan FDR account no.9/252 Both the vouchers are in the hand writing of Shri Kapdi. The Saving Bank account No.19363 shows a debit balance of Rs.2,549/- after the above said transactions. Thus the net total amount involved in this account was Rs.3,30,407/-.
d) Overdraft account no.13 of Shri Chandrakant B. Gad.
On 06-12-1998, an overdraft account against FDR was opened in the name of Shri Chandrakant B. Gad. The ledger showed an overdraft limit of Rs.5.50 lakhs. The FDR against which this loan was created on verification was found to be fictitious, documents not available on bank records and applicants details were also not available on the ledger. The debit balance on the said overdraft account was Rs.8,65,573/- with further interest thereon from 01-07-1999. Two cheques dated 06-02-1998 for Rs.3.00 lakhs and Rs.1.00 lakh respectively were withdrawn vide cheques written and passed by Shri Kapdi. There was no signature of the receiver of cash on the reverse of the cheque.
Similarly, on 14-02-1998, an amount of Rs.1.00 lakh was debited to the over draft account, vide a cheque written and passed by Shri Kapdi and here too, no signature was found on the reverse of the cheque of the person to whom the cash payment was made.
On 03-03-1998, an amount of Rs.25,000/- was withdrawn vide a cheque dated 24-02-1998 written by Shri Kapdi and though passed by a junior officer, was counter signed by Shri Kapdi.
On 23-03-1998, there is a transfer debit entry of Rs.1.60 lakhs to the said overdraft account. The voucher is signed by Shri Kapdi and credited to the Saving Bank account No.12089 of Shri S.S. Tople. The account opened in the name of Shri Chandrakant B. Gad was fictitious and the FDR against which the overdraft was granted, was also fictitious. Thus the transaction, i.e. the overdraft facility that was fraudulently created, was for a maximum limit of Rs.5.50 lakhs.
The amount withdrawn on this account was Rs.6.85 lakhs, i.e. Rs.1.35 lakhs over and above the overdraft limit.
Thus calculating the interest debited on the same, the total amount involved was Rs.8,65,573/- with further interest thereon from 01-07-1999.
(e) A/c of Shri Gokuldas Kumbharjuvekar On 23-12-1996, a loan of Rs.1,00,000/- was granted to Shri Gokuldas Kumbharjuvekar against security of FDRs as mentioned in a ledger under loan account no.10/215 (LF 8/25). As a matter of fact, none of these FDRs were pledged with the Complainant as security for the aforesaid loan. No loan documents were available on the bank records and it is seen that debit vouchers were in the hand writing of Shri Kapdi and passed by him. There is no signature of the receiver of cash on the reverse. Thus the Complainant states that the said loan account without any documents and security appears to be fictitious. The debit balance in the said loan in the said loan account was Rs.1,48,527/- with further interest from 01-07-1999.
The Complainant states that the total amount involved in all the above fraudulent accounts, totals Rs.37,21,782.50. The transactions unequivocally suggests that Shri Kapdi has dishonestly deceived the Complainant bank and played a fraud on them in total breach of trust and thus cheated them of lakhs of rupees and these clearly fall within the meaning of the term forgery or alteration or dishonesty as described in the Bankers Indemnity Policy entered into by the Complainant with the Opposite Party dated 31-03-1999.
The Complainant has lodged police complaint and filed claim before the Opposite Party for reimbursement in terms of the Bankers Indemnity Policy on account of the loss suffered. After numerous reminders, the complainant bank received an intimation dated 27-01-2000 from M/s. M.B. Nagarkar & Co., Surveyor & Loss Assessors informing them that they have been appointed to conduct a survey of the Complainants claim and asked for relevant records for verification.
On 11-03-2000, Shri M.B. Nagarkar visited the Complainant Bank and asked for elementary documents which were immediately supplied to him by the Complainant Bank.
Almost a year later, since the Complainant had not received any intimation from the office of M/s M.B. Nagarkar as regards the progress of the Complainants claim, the Complainant addressed yet another reminder dated 09-03-2001 to the Opposite Party that the Complainant had not received any intimation from the office. The Complainant states that after another unreasonably long period, vide letter dated 21-03-2001, Shri M. B. Nagarkar & Co asked for some more documents to check the transactions as stated by the Complainant. By letter dated 07-12-2001, the Managing Director of the Complainant was informed by the Branch Manager of the Opposite Party that they had received final survey report on 07-12-2001 and queried as to what stage the Police investigations had reached and what action was taken in departmental enquiry initiated against Shri Kapdi and the amount of terminal dues of Shi Kapdi was also requested for.
The above information was immediately furnished to the Opposite Party on the same day itself. The Complainant states that they obtained an unofficial copy of the final report submitted by M/s M.B. Nagarkar & Co., on perusal of which complainant noted that the total loss caused to the Complainant on account of fraudulent transactions by the employee Shri S.R. Kapdi was valued to the tune of Rs.27,92,892.50. The Complainant states that despite this final report, vide letter dated 12-02-2002, M/s M.B. Nagarkar & Co. asked the Complainant Bank for some more documents. The Complainant states that there was no rhyme or reason for asking further information after submission of final report to the Opposite Party. However, the Complainant furnished the required details to the said surveyor in order to settle their claims at the earliest. Again vide letter dated 11-03-2002, some more information was solicited and this correspondence was going on between the Surveyor and the Complainant. The Complainant states that suddenly, on 06-05-2002, the Branch Manager of the Opposite Party visited the Complainant along with another Surveyor by name Shri Bansali from Poona in order to re-assess the Complainants claim. The Complainant co-operated with the said Shri Bansali but objected to the appointment of another Surveyor and also demanded reasons from the Opposite Party for the same. The Complainant states that the subsequent surveyor was appointed by the Opposite Party illegally only for the purpose of mala-fide rejecting the Complainants claim. They stated that this practice of appointing one surveyor after another until favourable reports are obtained in favour of the Opposite Party, has to be deprecated as the same is illegal and arbitrary. They further stated that the second surveyor was deliberately appointed to nullify the final report submitted by M/s M. B. Nagarkar & Co.
which had assessed the loss to the tune of Rs.27,92,892.50. The Opposite Party had not given any reasons for appointment of a second surveyor.
The Complainant further stated that Shri Bansali visited the Branch Office of the Complainant/Bank for about one hour only once and examined two persons only and took copies of only a few documents and checked few transactions involved in the fraud. Thus the Complainant stated that the investigations carried out by Shri Bansali was not thorough and done in a slip shod manner.
The complainant states that they were shocked to receive letter dated 14-06-2002 from the Opposite Party informing them that in terms of report dated 18-05-2002 received from M/s. J.C. Bansali & Co., the liability of the Opposite Party was stated to be nil and thus the Opposite Party claimed that they had no liability in respect of the Bankers Indemnity Policy dated 31-03-1999. Complainant stated that the Opposite Party had never disputed that it is a case of fraud/dishonesty of an employee which is covered by the policy and thus the rejection of the Complainants claim on a deliberate and mischievous interpretation of the terms and conditions of the said policy amounts to deficiency in service. The Complainant stated that it was thus entitled for directions to the Opposite Party to settle the Complainants claim and also for compensation for wrongful rejection.
The Complainant thus prayed for a sum of Rs.37,21,782.50 and Rs.20,05,173/- being interest at 15% on the above amount for the period between 11/11/1999 to 13-06-2003. Thus the total amount of Rs.57,26,955.50 was claimed by the Complainant alongwith 15% interest on the amount from the date of order till date of actual payment.
The Complainant annexed 30 documents in support of their claim.
The Opposite Party in their reply as a preliminary objection stated that there was no deficiency in service and that the complaint was barred by limitation.
The Opposite Party, however, admitted that a policy of insurance was issued in favour of the Complainant. The Opposite Party further contended that with regard to the policy, the various transactions were examined by J.C. Bhansali & Co., Chartered Accountants appointed by the Opposite Party, had submitted that the relevant policy excluded the following:
Losses due to any acts or omissions committed by the concerned employees after the discovery of a loss in which the said employees were involved.
Opposite Party submitted that before detection of the loss claimed under the present complaint, the concerned employee, Mr. Kapdi was involved in the loss in respect of loan against bogus National Savings Certificate. The Opposite Party states that the Complainant Bank should have removed Mr. Kapdi from services after detection of loss in respect of the above bogus National Savings Certificate, which was not done and Mr. Kapdi was allowed to continue in the Banks service, due to which the loss now complained of, has taken place. Therefore, the loss now allegedly caused was clearly excluded from the terms of the policy.
The Opposite Party further submitted that their Chartered Accountant after examining all the transactions, had submitted a report dated 18-05-2002 and for reasons mentioned in the Report, had assessed the liability of the Opposite Party as being nil. The grounds largely stated were that the losses, if any, were trading loss which was not covered under the Insurance Policy, as policy excludes losses resulting directly or indirectly from trading, actual or fictitious. The report of the Chartered Accountant of the Opposite Party had also stated that the Complainant Bank could recover legally the amount advanced to its customers, M/s Camat & Co. and M/s S.S. Multiplast and in fact the Complainant Bank had recovered the amount of Rs.4,35,415/- from M/s S.S. Multiplast. The report further stated that various amounts totaling to Rs.27,71,649/- can be adjusted towards the alleged loss as per the right of recovery condition of the relevant policy. The report further noted that the terminal dues of Mr. Kapdi and Mr. G.B. Kamat like gratuity, etc. amounting to Rs.75,000/- could be adjusted toward the alleged loss. Opposite Party stated that the Complainant had already recovered an amount of Rs.5,32,190/- and Rs.4,11,229/- on 31-03-1999 from Mr. S.R. Kapdi which would have to be adjusted. The Opposite Party stated that even though the Complainant Bank was aware of the loss caused to them on account of the bogus National Saving Certificate by Mr.Kapdi, they did not take action against him and allowed him to continue in the Banks services and thus the Opposite Party was not liable under the policy as the same was in violation of the terms of the policy.
With regard to the appointment of M/s Bhansali & Co., the Opposite Party denied that they were appointed illegally or with intent to mala-fidely reject the Complainants claim to nullify the final report of M/s M.B. Nagarkar & Co.
The Opposite Party contended that it is the usual course followed by them to appoint two independent persons who investigate the transactions when huge amounts are involved. The Opposite Party denied that they have not applied their mind to the claim of the Complainant and stated that the Complainant was not entitled to any amounts under the policy and prayed that the complaint be dismissed with costs.
On an application made by the Opposite Party, the Managing Director of the Complainant Bank, Shri Suresh Palekar was cross examined by the Opposite Party. During cross examination, to the question whether Mr. Kapdi was involved in the loss caused to the Bank due to bogus National Savings Certificate, Shri Palekar replied that Mr. Kapdi had committed only a procedural lapse and the amount was reimbursed to the Bank and thus the Bank did not incur any loss in respect of the National Savings Certificate. He further stated that Mr. Kapdi was not involved in any fraud and further that the incident of the National Saving Certificate occurred prior to the detection of this case.
With regard to recovery of amounts from M/s Camat & Co. and M/s S.S. Multiplast, the Complainant admitted that a sum of Rs.4,35,415/- has been recovered by the Complainant Bank.
Further, with regard to recovery of any amount against M/s Gurukrupa Polymers, the Complainant stated that the Bank did not take any action against them, as M/s Gurukrupa Polymers was a fictitious body. On the aspect of terminal dues, payable to Mr. Kapdi, which could be recovered from him, the Complainant stated that no terminal dues were payable to Mr. Kapdi, as he has been terminated from services.
The Complainant denied the suggestion put to him by the Opposite Party that the Bank has recovered an amount of Rs.5,32,190/- and Rs.4,11,229/- from Mr. Kapdi as on 31-03-1999 towards the present fraud case. The Complainant also denied the suggestion that he could recover the amount of Rs.27,71,649/- under the Right to Recovery condition of the insurance policy. The Complainant also denied the suggestion that the repudiation of the claim by the Opposite Parties were proper and that the Bank was not entitled to recover any amount from the Opposite Party.
Affidavit-in-evidence was filed by Complainant, Opposite Party and Mr. J.C. Bhansali. Mr. J.C. Bhansali in his affidavit-in-evidence stated that he had carried out investigation in the matter, verified the records and submitted a report to the said Company with details of his investigations and findings, wherein he had opined that the Bank was not entitled to receive any amount under the policy.
A perusal of the report by Shri Bhansali & Co.
dated 18th May 2002, opines that Trading loss of a bank were not covered by relevant policy. We moot question thus is whether the loss caused to the Complainant Bank was a trading loss. Trading loss defined in simple terms can be said to be any loss incurred by a bank in the ordinary course of business.
With reference to the recovery of amount from M/s Gurukrupa Polymers, we are of the opinion that since the same is a fictitious entity fraudulently created by the alleged accused Mr. Kapdi, there could not be any bank- customer relationship and hence the same cannot be termed as a trading loss incurred by the Complainant Bank in the ordinary course of business.
Being a small bank, the entire control of the bank is largely with the Manager and thus being in this important position, committing the fraud by him was easier as he could surpass the internal checks which ordinarily could not have been done in a larger bank. Thus in the present case at hand, since the Manager being at the helm of affairs and in control of all transactions in that Branch, the contentions of Mr. Bhansali that the loss should have been recovered by the Bank prior to the fraud being discovered does not stand to reason.
For example, the report of Shri Bhansali suggest that the amount of Rs.1,89,712/- deposited on 28-12-1998 in the Over Draft Account could have been adjusted as per right of recovery condition of the relevant policy. This explanation does not hold good as the same amount in the Over Draft was subsequently withdrawn on 11-03-1999 and 13-03-1999, and the entire transactions appear to be mere eyewash to ensure and permit the accused Mr. Kapdi to continue with his fraudulent intentions. The fraud was in process and could not be discovered at the relevant time and thus the Complainant Bank had no possibility of recovery of the amount at the relevant time.
We thus are not in agreement with the findings of the report of Shri. Bhansali and reject the same.
We also note with concern the lackadaisical attitude of the Opposite Party in early settling of the claim of Complainant with them. The claim was filed by Complainants on 11-11-1999, on the fraud coming to light. Yet for over a month there was no reply from the Opposite Party hence this was followed up with letters dated 14-12-1999 and 21-12-1999 and 17-01-2000. The Complainants then received a letter from M/s. M.B. Nagarkar & Co., Surveyors and Loss Assessors informing Complainant that they have been instructed by Opposite Party to conduct survey and required numerous documents listed.
This was promptly relied to by the Complainant Bank vide their letter dated 04-02-2000, and Nagarkar4 & Co. visited the Complainant Bank on 11-03-2000 for on the spot inquiry. Letters dated 02-04-2001, 10-04-2001, 24-05-2001, 01/08/2001, 29/10/2001, 15-02-2002, 20-02-2002, 22-02-2002, 13-03-2002, 26-03-2002 and 04-04-2002 passed to and fro between M/s Nagarkar & Co. and the Complainant and all information sought by them was furnished by the Complainant Bank. M/s Nagarkar did not however give any report and there was no response from the Opposite Party despite letters to this effect by Complainant. Suddenly on 06-05-2002 the Opposite Party visited the Bank with another Surveyor Shri Bhansali, from Pune. Again after considerable silence and no report from M/s Nagarkar & Co., the complainant wrote letter dated 17-06-2002 to Opposite Party stating that 31 months have elapsed and claim was not settled yet. Vide this letter they also stated that they had co-operated with the Opposite Party with regard to all information and strongly protested the appointment of a second surveyor and wished to know the reasons thereof as the first surveyor had already done the assessment of the loss Complainants claim that they were informed by office of Opposite Party that M/s Nagarkar & Co. had assessed the loss at Rs.27,92,892/-.
The Complainant has stated that the first surveyor M/s M.B. Nagarkar & Co had assessed the loss to the tune of Rs.27,92,892.50. How was this figure arrived at? The Opposite Party has admitted that M/s Nagarkar & Co. had been appointed to examine the transaction. This practice by the Insurance Companies of appointing of surveyors to suit their needs has to be deprecated. To be fair the Opposite Party should have atleast placed on record the findings of the first surveyor and reasons for the appointment of the second one after a lapse of several months. This kind of behavior on the part of Insurance Companies will surely reduce the faith of consumers in such institutions. We also note that a representative of Shri Bansali & Co. visited the Complainant Bank on 06-05-2002 and prepared a report in a short time i.e. on 18-05-2002.
On record is also an audit report prepared by S.G. Usgaonkar & Co. who has on examining all records of the Bank estimated the amount involved in the fraudulent accounts as on 31-03-1999 to be Rs.42,77,275.50.
The Complainant admitted that a sum of Rs.4,35,415/- has been recovered by the Complainant Bank from M/s Camat & Co. and M/s S.S. Multiplast.
The Complainant has sufficiently proved their case. The Opposite Party cannot back out on their policy commitments based on a second report which suits their purpose.
ORDER The Opposite Party is directed to pay to the Complainant a sum of Rs.32,86,367.50 with interest @ 9% per annum from 11-11-1999 till final payment, within a period of 60 days from this order.
Pronounced.
[Sandra Vaz e Correia] Member [Caroline Collasso] Member