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State Consumer Disputes Redressal Commission

The Champawati Urban Co-Operative Bank ... vs The Manager,United India Insurance ... on 3 October, 2013

                                   1                   C.C.No.: 29/2012




                                Date of filing :07.11.2012
                                Date of order :03.10.2013
MAHARASHTRA STATE CONSUMER DISPUTE REDRESSAL
COMMISSION,MUMBAI, CIRCUIT BENCH AT AURANGABAD.


COMPLAINT CASE NO.: 29 OF 2012

The Champawati Urban Co-operative Bank Ltd.,
Beed, Tq.& Dist.Beed,
Through its Member, Board of Liquidator,
Bhagwat S/o Bhagwan Chalak,
R/o Shivaji Nagar,
Beed.                                        ...COMPLAINANT


VERSUS


The Manager,
United India Insurance Co.Ltd. ,
Chatrapati Sankul, 1st Floor,
Subhash Road,
Beed - 431 122.                                ...OPPONENT



            CORAM :     Mr.S.M.Shembole, Hon`ble Presiding Judicial
                        Member.

Smt.Uma S.Bora, Hon`ble Member.

Mr.K.B.Gawali, Hon`ble Member.

Present : Adv.Shri.Madhav Gude for complainant, None for opponent.

O R A L JUDGMENT (Delivered on 3rd October 2013) Per Mrs.Uma S.Bora, Hon`ble Member.

1. The Champavati Urban Co-operative Bank LTd., Beed through it's Member, Board of Liquidator, Bhagwat Bhagwan Chalak resident of Beed filed this complaint against Manager, United India Insurance Co.Ltd. Beed.

2. Complainant represented by Adv.Madhav Gude. It is submitted by Adv.Gude that complainant Champavati Bank is registered under Co-operative Societies Act, Maharashtra and Banking Regulation Act 1948 and is under control and supervision of Reserve Bank of India. Opponent Insurance Company accepted the banker indemnity by issuing policy in favour of bank. Said policy bearing No.230703/46/09/62/00000021. The said policy was valid from 15.5.2009 to 14.05.2010 covering risk of sum insured of Rs.47 lakhs. Premium of Rs.40654/- was paid on dated 14.5.2009. It is submitted by complainant that retroactive date of the policy is 13.5.2002. Since 2002, the insurance of the said bank was continuously in force with the Insurance Company. It is further submitted by Adv.Gude that audit of the said bank for the period 1.4.2007 to 31.3.2008 by District Special Auditor-Class I, Co-operative Societies was done and it was found that amount of Rs.4,18,12,329/- was misappropriated by the employees and directors of the said bank. Complainant submitted that as fraud was disclosed through audit report, complainant filed criminal case NO.56/2009 on 10.6.2009 U/s 409, 408, 406, 467, 468, 477, 107, 420 and 34 IPC at City Police Station, Beed against 34 persons i.e. employees and directors of bank. As audit report was conducted by the District Special Auditor, complainant got the knowledge about misappropriation of huge amount of Rs.4,18,12,329/-. Therefore complainant approached to insurance company and informed about the bankers indemnity claim. After getting claim form from insurance company the claim was preferred on 18.12.2009 with audit report, policy document, F.I.R. copy etc. Even after receipt of the claim nothing was informed by insurance company to the bank. Thereafter bank went into liquidation and board of liquidator was appointed on the bank. Correspondence was made by board of liquidator with the insurance company about the insurance claim by letter dated 26.3.2010, 4.6.2010, 6.10.2010 and 13.10.2010 and lastly on 4.7.2012. But claim was not decided preferably within three months neither any communication was made 3 C.C.No.: 29/2012 by insurance company with the complainant. Therefore on 8.9.2012 legal notice was issued to the insurance company. Said notice also was not replied by the insurance company. Therefore complainant filed this complaint claiming insurance amount of Rs.47 lakhs, Rs.1 lakh as compensation and Rs.50,000/- as cost.

3. After registration of complaint notice was issued to the insurance company but none appeared for insurance company. Even after admission of complaint, notice was issued by RPAD to the insurance company. Thereafter complaint was posted for hearing on 15.4.2013, 26.6.2013, 23.8.2013, 3.9.2013, 23.9.2013 none appeared for insurance company. Therefore on 15.4.2013 complaint was proceeded exparte against insurance company.

4. Complainant with their complaint produced copy of claim form with covering letter requesting insurance company to decide the claim as early as possible, copies of insurance policy, audit report for the period 1.4.2007 to 30.9.2008 and charge-sheet filed against employees and director of the bank. We heard Adv.Madhav Gude for the complainant and constrained to proceed exparte against insurance company as it was not responded to the correspondence made by complainant and even to the notice issued by this Commission. In our view we have no alternative but to accept the averments made by the complainant in complaint. In our view complainant had obtained bankers indemnity policy for Rs.47 lakhs and as per policy complainant is entitled to receive the said amount. We are therefore allowing the complaint as no rebuttal or challenge was made to the averments in the complaint by insurance company. Hence the following order.

O R D E R

1. Complaint is partly allowed.

2. Opponent is directed to pay Rs.47,00,000/-(Rs.Forty seven lakhs only) with interest @ 6% p.a. within a month from the receipt of copy of this order.

3. Opponent is directed to pay Rs.50,000/-(Rs.Fifty thousand only) as compensation and Rs.25,000/-(Rs.Twenty Five thousand only) as cost of complaint.

4. Copies of the judgment be supplied to both the parties.

   Sd/-                       Sd/-                     Sd/-
K.B.Gawali,                 Uma S.Bora,            S.M.Shembole,
 Member                      Member         Presiding Judicial Member


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