State Consumer Disputes Redressal Commission
National Insu Co Ltd. vs Bank Of Baroda on 5 May, 2022
Details DD MM YY
Date of disposal 05 05 2022
Date of filing 25 04 2013
Duration 11 -- 09
BEFORE THE CONSUMER DISPUTES REDRESSAL COMMISSION
GUJARAT STATE, AHMEDABAD.
COURT NO: 04
APPEAL NO. 1612 of 2013
National Insurance Co. Ltd.
Through its Regional office,
Hasubhai Chambers,
Nr. Town Hall, Ellis Bridge,
Ashram road, Ahmedabad- 06. ... Appellant.
V/s.
1. Bank of Baroda,
Shahpur Branch, Ahmedabad.
2. M/s. Patel Dresses,
Owner S.Y. Patel,
Opp. Municipal Lal School,
Shahpur, Ahmedabad. ...Respondents.
APPEAL NO. 1220 of 2013
National Insurance Co. Ltd.
Through its Regional office,
Hasubhai Chambers,
Nr. Town Hall, Ellis Bridge,
Ashram road, Ahmedabad- 06. ... Appellant.
V/s.
1. Bank of Baroda,
Shahpur Branch, Ahmedabad.
2. M/s. Patel Readymade,
Owner Patel Yunus Mohmadbhai,
Opp. Municipal Lal School,
Shahpur, Ahmedabad.
Legal Heirs of deceased Patel Yunus Mohmadbhai,
1. Rashidabanu Yunusbhai Patel (wife)
2. Mohsin Patel (Son)
3. Irfan Patel (Son)
4. Riyaz Ahmed Patel (Son)
5. Tosif Ahmed Patel (Son)
6. Samir Ahmed Patel (Son) ...[Vide order dated 17.11.2021] ...Respondents.
BEFORE: Dr. J.G. Mecwan, Presiding Member.
APPEARANCE: Mr. V.P. Nanavaty, L.A. for the appellant,
Mr. U.R. Bhatt, L.A. for the respondent No. 01.
Mr. V.M. Pancholi, L.A. for the respondent No. 02.
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ORDER BY DR. J.G. MECWAN, PRESIDING MEMBER.
JUDGMENT
1. Being aggrieved by and dissatisfied with the judgment and order rendered by the learned District Consumer Disputes Redressal Commission, Ahmedabad (Add) on 15.02.2013 in Complaint No. 680 of 2010 and Complaint No. 681 of 2010 the original opponent has filed the present Appeals under Section 15 of the Consumer Protection Act, 1986 before this Commission. For the sake of the convenience, parties are hereinafter referred to by their original nomenclature.
2. The present Appeals have been filed against the order of the ld. Dist. Commission Ahmedabad (Add.) in C.C. No. 680/2010 & 681/2010. As in both the appeals facts and arguments and law points are same, this Commission has decided to dispose of these two appeals by common judgment.
3. The facts which led the appellant to file these Appeals in a nutshell are as under: It is the case of the complainant that complainant carries on the business of readymade clothes and had taken two insurance policies amounting to Rs. 10,00,000/- and Rs. 9,50,000/- from the opponent No. 01 Ins. Co. through opp. No. 02 - Bank on date 08.05.2009. On date 12.05.2009 fire broke out in the shop of complainant late night at 1:15AM i.e. early morning at 1:15AM on date 13.05.2009. Thereafter necessary Panchnama made by the Police authority and opp. Ins. Co. has been intimated accordingly on 13.05.2009. It is further the case of the complainant that after necessary investigation for both the claims surveyor appointed by opp. Ins. Co. who has assessed the loss amounting to Rs. 4,12,000/- with the deduction of 15% salvage value in First claim and Rs. Page 2 of 11
R.I. DESAI A/1612/2013 & A/1220/2013 4,50,000/- with the deduction of 15% salvage value for the second claim. However opp. Ins. Co. has rejected both the claims stating that premium was received by opp. Ins. Co. on date 13.05.2009 and accordingly the policy has been issued on the same date and thereby at the relevant time there was no subsisting policy of insurance and therefore due to such deficiency in service complainant has filed Consumer Compliant before learned District Commission Ahmedabad (Add).
4. Being dissatisfied with the deficiency in service by the opponent, complainant has filed C.C. No. 680/2010 before the ld. District Commission Ahmedabad (Add) for getting the compensation amounting to Rs. 5,12,500/- with 15% interest and filed C.C. No. 681/2010 for getting the compensation amounting to Rs. 5,50,000/- with 15% interest from the opponents.
5. After hearing learned advocates for both the parties and after considering the documents and evidences, the learned District Commission allowed the Complaint of the complainant.
6. Being aggrieved by the impugned order of the learned District Commission, Ahmedabad (Add) the original opponent No. 01 has filed the present Appeal against the original complainant before this Commission on the ground stated in the appeal memo.
7. Heard ld. Adv. Mr. Darshil Parikh for Ld. Adv. Mr. V.P. Nanavaty for the appellant, ld. Adv. Mr. U.R. Bhatt for the respondent No. 01 and Ld. Adv. Mr. V.M. Pancholi for the respondent No. 02 at length. Perused the record of the case, judgment submitted by appellant and order of the ld. District Commission.
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8. First of all learned Advocate Mr. Darshil Parikh has appeared on behalf of the appellant and argued out that ld. Dist. Commission has committed serious jurisdictional error by misinterpreting the specific condition of MOU executed between the opponent Ins. Co. and Bank of Baroda. It is further argued out that the ld. Dist. Commission ought to have considered letter of Bank of Baroda dated 08.05.2009 whereby it has forwarded consolidated premium to the appellant Ins. Co. which was received by the Divisional Office of the appellant on date 13.05.2009 and therefore the policy of insurance incepted from 15.55 hrs. on 13.05.2009. Furthermore ld. Dist. Commission has failed to appreciate the provisions of Section 64VB of the Insurance Act, 1938 and passed the erroneous order which needs to be quashed. It is further submitted that the entire finding of fact recorded by the ld. Dist. Commission that opp. No. 02 was agent on behalf of Opp. 01 is misconceived and not tenable in the eye of law and also in view of the specific condition as appearing in the MOU. Moreover ld. Dist. Commission ought to have appreciated that the complainant suffered damage due to fire at about 1.15hrs. on 13.05.2009 whereas the policy was incepted from 15.55hrs. on 13.05.2009 and therefore at the relevant time there was no subsisting policy of insurance.
9. Learned Adv. Mr. Parikh concluded that the order passed by the ld. District Commission is not just and proper and therefore it should be quashed and set aside by allowing these Appeals. In support of his arguments ld. Adv. Mr. Parikh has submitted following judgment along with Section 64VB of the Insurance Act, 1938.
(I) III (2016) CPJ 394 (NC) - New India Assurance Co. Ltd. Vs. Ashok Kumar & Anr. (II) IV (2011) CPJ 170 (NC) - Union of India & Anr Vs. Anita Singhvi. (III) Civil Appeal No. 2671/1991 (SC) - National Ins. Co. Ltd. Vs. Smt. Jijubhai N. Dabhi & Anr.
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(IV) II (2012) CPJ 535 (NC) - Puspita Sahoo Vs. Oriental Ins. Co. Ltd. & Anr.
(V) I (2009) CPJ 6 (SC) - Deokar Exports Pvt. Ltd. Vs. New India Assurance Co. Ltd.
(VI) I (1999) ACC 439 (SC) - New India Assurance Co. Vs. Bhagwati devi & ors.
10. Upon service of the notice ld. Adv. Mr. U.R. Bhatt has appeared on behalf of the respondent No. 01 and vehemently argued out that in this case Bank pursuant to a MOU dated 01.06.2004 with the opponent No. 01 has been acting as a "Corporate Insurance Agent" (agent) and duly collected the premium from the complainant by debiting the complainant's account on 08.05.2009 and vide letter dated 08.05.2009 bearing ref. no. SHP/ADV/35/284 sent the same to opponent No. 01 Divisional Office situated at Laldarwaja, Ahmedabad wherein the premium amount of 10 parties are sent and the present complainant is shown at serial No. 09 and thus, the bank has duly and legally acted as an agent of the Insurance company and also performed its duties duly and legally as an agent for its principle. Moreover it is settled legal position that the principal is responsible for all acts of its agent especially when the said acts are performed duly and legally as is admittedly done in this case. It is further argued out that the premium was received by opponent No. 02 agent Bank and was also transmitted to the opponent No. 01 which has received the premium and hence it is the legal duty of the Ins. Co. that the claim of the insured is processed as if the premium was duly received and therefore the Insurance Co. cannot deny processing of the claim as the premium is already received by it since, in any case the account of complainant is debited by the opponent No. 02 - agent bank of the Ins. Co. on 08.05.2009 and incident was occurred on 13.05.2009 and therefore in view of the matter it shall be held that opponent Bank is not at all responsible in any manner as bank neither a necessary nor a party to the proceeding as the Page 5 of 11 R.I. DESAI A/1612/2013 & A/1220/2013 bank has legally and validly acted and collected premium as an agent of the Ins. Co. and in case if any disputes between opponent No. 01 and 02, it should be subsequently and separately resolved in accordance with law by arbitration etc. In support of his arguments ld. Adv. Mr. Bhatt has submitted following judgments:
(I) Civil Appeal No. 3677/1984 - National Ins. Co. Ltd., New Delhi Vs. Jugal Kishore.
(SC) (II) Civil Appeal No. 954/1965 - Gopal Krishnaji Ketkar Vs. Mohamed Haji Latif. (SC)
11. I have also given audience to ld. Adv. Mr. V.M. Pancholi appeared for the respondent No. 02. It is contended that after careful and exhaustive consideration ld. District Commission has rightly held opponents liable which is just and proper. It is further submitted by ld. Adv. that ld. District Commission has rightly observed all the concerned things and according to facts and circumstances of the case appropriately awarded the claim amount which is just and reasonable. Furthermore ld. District Commission has rightly come to the conclusion that by repudiating the claim of the complainant opponent Insurance Company has committed deficiency in service and therefore it doesn't require any interference of this Commission and hence the order of the ld. District Commission should not be intervened by this Commission.
12. Ld. Adv. Mr. Pancholi concluded that the order passed by the ld. District Commission is just and proper and therefore it should be confirmed by dismissing this Appeal. In support of his arguments ld. Adv. Mr. Pancholi has submitted following judgments:
(I) II (2015) CPJ 649 (NC) - National Ins. Co. Ltd. Vs. Prafulaben Shah (II) I (2010) CPJ 250 (NC) - New India Assurance Co. Ltd. Vs. Sushil Sharma & Anr. (III) III (2008) CPJ 254 (NC) - Shakumbhri Exports Vs. Leigh Hoech & Co. A/S & Ors.Page 6 of 11
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13. I have given my anxious and thoughtful consideration to the rival contentions made by both the sides. In the present case it is an averment of the opp. Ins. Co. that said premium amount - cheque/DD issued by the opponent Bank has been received by Divisional Office of the appellant on date 13.05.2009 and accordingly the policy of insurance incepted from 15.55 hrs. on 13.05.2009 because as per MOU with the opponent Bank, Insurance Co. shall not be able to cover the risk under any policy without receipt of the premium. It is required to be noted here that vide application dated 09.08.2018 respondent Bank has prayed before this Commission to direct opponent Ins. Co. to produce and to disclose the information and details as to when opp. Ins. Co. have deposited the cheque sent by the Bank and when the said amount was actually credited in the account of opp. Ins. Company but in response to this opp. Ins. Co. has not provided any information or details in pursuant to the above application and consequently failed to disclose these vital facts.
14. At this juncture it would be opt and appropriate to cite the provision of Section 114 of the Indian Evidence Act as under:
Section 114 in The Indian Evidence Act, 1872 114 Court may presume existence of certain facts. --The Court may presume the existence of any fact which it thinks likely to have happened, regard being had to the common course of natural events, human conduct and public and private business, in their relation to the facts of the particular case. Illustrations The Court may presume--
(a) That a man who is in possession of stolen goods soon after the theft is either the thief or has received the goods knowing them to be stolen, unless he can account for his possession;
(b) That an accomplice is unworthy of credit, unless he is corroborated in material particulars;
(c) That a bill of exchange, accepted or endorsed, was accepted or endorsed for good consideration;
(d) That a thing or state of things which has been shown to be in existence within a period shorter than that within which such things or state of things usually cease to exist, is still in existence;
(e) That judicial and official acts have been regularly performed;
(f) That the common course of business has been followed in particular cases;
(g) That evidence which could be and is not produced would, if produced, be unfavourable to the person who withholds it;Page 7 of 11
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(h) That if a man refuses to answer a question which he is not compelled to answer by law, the answer, if given, would be unfavourable to him.
In view of the above in the instant case also opp. Ins. Co. has failed to produce such crucial information and resultantly it establish that the information sought for by respondent Bank is if produced, be unfavourable to the Ins. Co. and therefore this Commission presumes that the opp. Ins. Co. has actually received the premium in their bank account after 13.05.2009.
15. I have scrutinized the record of this case. Copy of MOU between opp. Bank and opp. Ins. Co. has produced on record at page no. 162 wherein it has been specifically mentioned as under:
"AND WHEREAS NICL AND BANK has discussed and agreed that, it would be in their Mutual interest that Bank should act as a Corporate Agent for NICL in relation to the marketing of products of NICL".
From the above it palpably emerges that opp. Bank has been working as a "Corporate Agent" of the opp. Ins. Company and hence in the opinion of this Commission when Bank has received the premium as an Agent of the opp. Ins. Co. then it is deemed that Ins. Co. has received the said premium amount.
16. I have also gone through the Provision of Section 64VB of the Insurance Act, 1938 which reads as under:
Section 64VB in The Insurance Act, 1938 64VB. No risk to be assumed unless premium is received in advance.--
(1) No insurer shall assume any risk in India in respect of any insurance business on which premium is not ordinarily payable outside India unless and until the premium payable is received by him or is guaranteed to be paid by such person in such manner and within such time as may be prescribed or unless and until deposit of such amount as may be prescribed, is made in advance in the prescribed manner.
(2) For the purposes of this section, in the case of risks for which premium can be ascertained in advance, the risk may be assumed not earlier than the date on which the premium has been paid in cash or by cheque to the insurer.Page 8 of 11
R.I. DESAI A/1612/2013 & A/1220/2013 Explanation.--Where the premium is tendered by postal money order or cheque sent by post, the risk may be assumed on the date on which the money order is booked or the cheque is posted, as the case may be.
(3) Any refund of premium which may become due to an insured on account of the cancellation of a policy or alteration in its terms and conditions or otherwise shall be paid by the insurer directly to the insured by a crossed or order cheque or by postal money order and a proper receipt shall be obtained by the insurer from the insured, and such refund shall in no case be credited to the account of the agent.
In the instant case Bank has posted the said cheque on 08.05.2009 vide letter bearing ref. no. SHP/ADV/35/284 to opponent No. 01 Divisional Office situated at V Jashvant Chambers, Laldarwaja, Ahmedabad which is also on record at page No. 119 wherein the premium amount of 10 parties are sent and the present complainant is shown at Serial No. 09 carrying total amounting to Rs. 2,018/- (Ser. Tax + Amt. of premium) and therefore in the opinion of this Commission as per Section 64VB the risk may be assumed from date 08.05.2009 and hence this Commission come to the conclusion that the said policy was admittedly in force from date 08.05.2009 and as a resultant complainant is entitled to get the claim for fire incident occurred at his shop on 13.05.2009 at 1:15AM.
17. I have come across the judgment of this Commission in Appeal No. 590/2010 in the case of The National Ins. Co. Ltd. Vs. Kartik Naneetlal Patel and Ors. As the above referred case and the case on hand contains similar law points and therefore it would be beneficial to reproduce the observation of the aforesaid case as under:
"૧૧. ઉપરોક્ત ચચચાને આધચરે તથચ રજુ થયેલ રેકર્ા તથચ વિ. ફોરમનો ચુકચદચમચ રજુ થયેલ બચબતોને આધચરે એ બચબત સ્પસ્ટ થચય છે કે મ્રુતક કચર્તાક્ભચઇનચ બચત ખચતચમચથી ઉધચરિચમચ આિેલ રૂ. ૬૦૬/- િીમચ વિવમયમ સચમચિચળચ ન. ૧ બેંકે તચ. ૫/૧૦/૨૦૦૬ નચ રોજ વિમચ કંપનીને પોસ્ટથી રજી.પો.ર્ી. થી મોકલેલ છે તેથી ઇંસ્યોરંસ એક્ટની કલમ ૬૪ િી બી િમચણે તચ. ૫/૧૦/૨૦૦૬ થી રરસ્ક કિર થચય છે તેિુ આ કવમશન મચને છે તેથી પોવલસીધચરકનચ િચરસ વિમચ કંપની પચસેથી વિમચ ક્લેમની રકમ મેળિિચ હકદચર બને છે અને તેથી વિ. ફોરમે મુળ ફરરયચદનચ કચમે કરેલ હુ કમ યોગ્ય છે ..."
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R.I. DESAI A/1612/2013 & A/1220/2013 In view of the above in the instant case also when opp. Bank has posted the cheque to the opp. Ins. Co. on date 08.05.2009 then it can be considered that opp. Ins. Co. has received the premium on date 08.05.2009 and subsequently the risk is covered from 08.05.2009.
18. It is an averment of the ld. Adv. for the opponent Bank that if policy was came to an end/cancelled then why opp. Ins. Co. did not credited any refund amount to the complainant's account? In pursuant to this, in the considered opinion of this Commission if policy stands cancelled at the relevant time then as per above Section 64 VB(3) opp. Ins. Co. would have credited such refund amount in the account of the complainant but opp. Ins. Co. has not submitted an iota of evidence that such amount has been credited to the complainant's account towards refund nor the complainant has produced any evidence on his behalf for the same.
19. In light of the above delineation and materials on record this Commission is of the view that order passed by the learned District Commission is just and proper. Learned District Commission has discussed all these things in great depth and therefore no any interference is required by this Commission and hence the following final order is passed.
ORDER
1. The present Appeal no. 1612 of 2013 and Appeal No. 1220 of 2013 is hereby dismissed.
2. The judgment and order passed by learned District Commission Ahmedabad (Add) in C.C. no. 680/2010 and C.C. No. 681/2010 dated 15.02.2013 is hereby confirmed.
2.1 It is required to be clarified here that as the original complainant in C.C. No. 681/2010 - Mr. Yunus Mohmadbhai Patel has died Page 10 of 11 R.I. DESAI A/1612/2013 & A/1220/2013 during the proceedings of this case, his legal heirs have been brought on record vide order dated 17.11.2021 and therefore it goes without saying that order passed herein will be complied with accordingly.
3. No order as to costs.
4. Appellant is directed to apply to the Account Department of the State Commission with all details of Appeal No. 1612/2013 (C.M.A. No. 517/13) & Appeal No. 1220/2013, Xerox copy of the receipt to withdraw the amount deposited in the State Commission. The office is hereby ordered to pay deposited amount with accrued interest on proper verification to the appellant by Account payee cheque and the cheque be handed over to the learned advocate for the appellant after obtaining receipt.
5. Registry is hereby instructed to send a copy of this order in PDF format by E-mail to learned District Commission Ahmedabad (Add) for taking necessary action.
6. Office is directed to place the copy of this judgment in both the Appeal No. 1612/2013 and Appeal No. 1220/2013.
7. Office is directed to forward a free of cost certified copy of this judgment and order to the respective parties.
Pronounced in the open Court today on 5th May, 2022.
[Dr. J.G. Mecwan]
Presiding Member
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