Karnataka

Bidar

CC/4/2016

Dhanraj S/o Mahadayya Swamy - Complainant(s)

Versus

Agricultural Insurance Co.LTd. - Opp.Party(s)

Sri.S.V.Gabade.Advocate

07 Aug 2017

ORDER

::BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM,

AT BIDAR::

 

 

                                                                                                               C.C.No. 04/2016

 

                                                                                                  Date of filing : 01/02/2016

 

                                                                                              Date of disposal : 07/08/2017

 

P R E S E N T:-                    (1) Shri. Jagannath Prasad Udgata,

                                                                                         B.A., LL.B.,

                                                                                                       President.

    

                                       (2) Shri. Shankrappa (Halipurgi),

                                                                                 B.A.LL.B.,

                                                                                           Member.

 

                                               

COMPLAINANT/S:      Dhanaraj S/o Mahadayya Swamy,                        

                                    Age: 50 years,  Occ: Agriculture,

                                       R/o Boral Tq: Aurad Dist: Bidar.

                                                          

              

 

 

                                    (By Sri. S.V.Gabade, Advocate)

 

 

                                                      VERSUS

 

OPPONENT/S   :-      1.    Agricultural insurance company of India Ltd.  
                                        Head office 13^th Floor Ambadeep Building K.G.

                                        Marg Cannaught place New Delhi 110001.

                                          

                                    2.    Divisional Manager (Karnataka State Office) 

                                        National Agricultural Insurance Co.Ltd.

                                       Karnataka Pradesh Krishi Samaj No-18,
                                       Nrupathungu Road, Hudson Circle Banglore-
                                        560001 (Karnataka).

                                          

                                    3.   The Agriculture officer Krishi Sampark

                                       Kendra Aurad.

                                           

 

                                      

 

 

 

                                 (O.P.No.1 and 2 By Shri. Vaijinath S. Zalki, Adv.)

                                  (OP.3Exparte)

                            

 

                                               

 

 

 

 

::   J UD G M E N T ::

 

 

 

By Shri. Jagannath Prasad Udgata, President.

 

1.        The present complainant is before us agitating his rights u/s 12 of the C.P. Act, 1986, against the opponents, alleging deficiency of service and subtly unfair trade practice.  The core issue involved in the case is as follows:-

 

2.         The complainant herein is an agriculturist by profession and holder of agricultural land to the exlent of Ac.8.00 in Sy.No.48/D of Boral (village), Aurad (Tq), Bidar (Dist) and he had sown Khariff crops in his land as detailed below:-

            Soya – Ac.4.00

            Tur (Redgram) –Ac.2.00

            Jawar (Maize) Ac.1.00

 

3.            The cropping pattern is duly certified by the grass root level revenue officer, i.e. Village Accountant vide Ex.P.1.  The farmer/Complainant had opted for agriculture insurance scheme floated by the National Government, of which opponent No.1 was the implementing agency and rest two facilitation agencies.  The Corollary goes on that, the complainant had got his crops insured stated above vide Ex.P2,P3, and P4 for which he had paid a total premium of Rs.1727/- insuring his crop (loss) against unforeseen natural calamity (s).  The Government of Karnataka, vide Ex.P.10 had declared the Taluk as draught hit and sustaining total crop loss, the complainant had raised an insurance claim.

4.            The opponent No.1, considering the plea had released sum of Rs.358.17paise, against crop insurance of Rs.41,492/-, aggrieved by which the complainant is before us, as inspite of legal notice Ex.P.6, the opponents have not risen to the occasion.

5.           The opponents have appeared through their counsels of choice after receiving the Court notice and the opponent No.1 is the main contestant in the case.  

6.            Said opponent, trying to justify its approach to the issue had filed elaborate written version.  In page 2 Para-C to clause 13 of page-7, the opponent had made submissions that, it has acted appropriately as per the Modified National Agricultural Insurance Scheme and has granted the just claim to the Insured/Complainant in a sum of Rs.358.17 paise and prays that, the case is misconceived.  Trying to justify its’ approach and canvassment, the opponent NO.1 has inserted and harped on a formula of indemnity calculated at page-3 of the versions as follows:-

 

Indemnity = Threshold yield-Actual yield X sum insured for the farmer

                                                    Threshold yield.

7.                     At Clause (l) of the same page, the Insurer claims to have arrived at the figure of compensation on the basis of average of the preceding 7years yield data and thereby claims to have committed no deficiency of service.

 

8.                     The parties here to, (mainly opponent No.1) have filed their respective evidence affidavits, arguments and documents listed at the end of this order.  O.P. also has filed few rulings. 

9.                     Basing on the pleadings of the parties, the following points arose for our consideration:

 

1. Is there any element of unfair trade practice as described in Section2(1) (r) of the  C.P. Act, 1986?
2. Does the complainant prove deficiency of service in the part of the opponents?
3. What order?

 

 

 

10.           Our answers to the points  stated above are as follows:-

 

1. In the affirmative.
2. In the affirmative.

3. As per final orders for the following:

 

:: REASONS ::

                                             

11.        Points No.1 and 2  are being answered combinedly.

The parties are in agreement about the fact of obtainment of the agriculture Insurance policy by the complainant.  The defence of the contesting O.P. No.1 is that, it has adopted the indemnity formula prescribed in the scheme and hence has done no wrong.

 

12.             We have a gut feeling that the canvassment of the contesting opponent is in-corrigible per se we feel that, the insurance Company has created an ambiguity in turning the situation as is at present.  The question which looms large in our mind and perfectly pointed out by the complainant counsel is that, whether the insurance company or the Nodal Bank at any point of time, during the acceptance of insurance premium ever made known, to the proposer that, a formula of average yield data of preceeding 7 years would be adopted in future to calculate compensation for crop loss?   If so, when and how?  Had the insurer or its’ associates have ever thrived to appraise the proposer in that regard?

 

13.                  Nothing is in the record to prove the honest deliberations of the opponents and the sum total is, the opponents together are out to deny the gullible farmers of this country just claims, driving them to further woes and desperations in contradiction of the policy of the National Government.  The media is agog with news of farmers’ suicide, sufferance of their families, and loss of basic requirements of the family due to the death of the sole bread winner.  Alas, the institutions but are apathetic to the situation.  Engrossed in weaving legal cob web.

 

14.                   As discussed earlier, the insurance company creating an ambiguous situation in misleading the proposer to fall for a policy we propose to clear the legality in the approach of the insurer first.  In a landmark judgement reported in Vol. IV. CPJ-2016 IPICOL Ltd. v/s New India Insurance Company Ltd. the Hon’ble  Apex Court has been pleased to hold in paragraph 09 as follows.

“It is well-settled law that there is no difference between a contract of insurance and any other contract, and that it should be construed strictly without adding or deleting anything from the terms thereof”.

15.                   Going a step further ahead the Hon’ble Apex Court has discussed the doctrine of “contra proferentem” in paragraph 10 and 11 of the judgement as follows, which can be benevolently applied in favour of the insured.

            “We proceed to deal with the submission made by Counsel for the Appellant regarding the rule of contra proferentem.  The common Law rule of construction “verba chartarum forties accipiuntur contra proferentem” means that ambiguity  in the wording of the policy is to be resolved against the party who prepared it.  Macgillivray on Insurance Law (9^th ed., 1997) (Nicholas Legh-Jones et al, eds.) at p.280, deals with the rule of contra proferentem as follows:

            “The contra proferentem rule of construction, arises only where there is a wording employed by those drafting the clause which leaves the Court unable to decide by ordinary principles of interpretation which of two meanings is the right one.  “One must not use the rule to create the ambiguity one must find the ambiguity first.”  The words should receive their ordinary and natural meaning unless that is displaced by a real ambiguity rather appearing on the face of the policy or, possibly, by extrinsic evidence of surrounding circumstances”. (footnotes omitted).  Colinvaux’s  Law of Insurance, (6^th ed., 1990) (Robert and Merkin, eds.) at p.42. propounds the contra proferentem rule as under:

            “Quite apart from contradictory clauses in policies, ambiguities are common in them and it is often very uncertain what the parties to them mean.

            In such cases the rule is that the policy, being drafted in language chosen by the insurers, must be taken most strongly against them.  It is construed contra proferentes, against those who offer it.  In a doubtful case the turn of the scale ought to be given against the speaker, because he has not clearly and fully expressed himself.  Nothing is easier than for the insurers to express themselves in plain terms.  The assured cannot put his own meaning upon a policy, but, where it is ambiguous, it is to be construed in the sense in which he might reasonably have understood it.  If the insurers wish to escape liability under given circumstances, they must use words admitting of no possible doubt.

            But a clause is only to be contra proferentes in cases of real ambiguity.  One must not use the rule to create an ambiguity.  On must find the ambiguity first.  Even where a Clause by itself is ambiguous if, by looking at the whole policy, its meaning becomes clear, there is o room for the application of the doctrine.  So also where if one meaning is given to a clause, the rest of the policy becomes clear, the policy should be construed accordingly”.  (footnotes omitted)

            This court in General Assurance society Ltd. V.Chandmull Jain and ant., reported in 1966 (SLT soft) 184=[1966] 3 SCR 500, held that there is a difference between a contract of insurance and any other contract except that in a contract of insurance there is a requirement of uberima fides, i.e., good faith on the part of the insured and the contract is likely to be construed contra proferentes, i.e., against the company in case of ambiguity or doubt.  It was further held in the said judgment that the duty of the Court is to interpret the words in which the contract is expressed by the parties and it is not for the Court to make a new contract, however reasonable”.

 

16.                   Further  we may put hear that the insurance Company directly or impliedly putting a belief in the mind of the farmer that, his crops if destroyed due to natural calamities in the relevant year, would be indemnified would be estopped to claim otherwise at a later stage.  The Hon’ble A.P. High Court in a case between N. Bhuwaneshwar Rao v/s Principle Osmania Medical college reported in A.I.R. 1986 Page 196 (at page 2020) has been pleased to hold as described here under.

 

            “The doctrine off equitable estoppels applies to case where a person  is given as unequivocal assurance and on the faith thereof, he acted detrimental to his interest and he suffered an irretrievable injury in that pursuit.  In such an event having made such a promise the maker there of is precluded to resist there from and pass an order detrimental to the interest of the person who believed the promise; placed reliance thereof, acted on that basis to his detriment and he cannot adequately be compensated”.

 

17.       Albeit the opponent No.1 has painstakingly produced before us the judgements of higher foras detailed below:-

1.         Revision petition No. 2393-2394 of 2008 A.I.C. of India Ltd. and
           others v/s B.Narayan Swamy.

2.         Appeals No.2924/2009 to3004/2009, M.D.G.I.C. of India v/s
            Somanagouda and others of Karnataka State Commission.

3.         W.P. Nos. 16457/2007 to 16461/2007 (G.M-conv) v/s
           Dyavanagouda and others of Hon’ble High Court of Karnataka.
4.         W.P. Nos. 31701 to 31703/2008 Sri Virupakshappa and others v/s     
          M.D.A.I.C. of India Ltd. of Hon’ble High Court of Karnataka.

 

 

18.       The opponent No.1 undoubtedly tried to justify its’ award of lesser compensation than the insured amount for which the premium amount was received by it.

 

19.       Contritely, none of the judgements quoted above has dealt with the doctrines of “ESTOPPEL” and none had pleaded.  The higher foras also had not thought regarding the aspect as discussed and hence we are not inclined to consider the canvassments of the opponents.  Thereby, we rule that, there has been an unfair trade practice and deficiency of service perpetrated upon by the complainant by all opponents and ruling accordingly, we proceed to pass the following:-

 

                                                       ::ORDER:: 

1. The complaint is allowed in part.
2. The O.P.No.1 is hereby directed to reimburse a some of Rs.41492 together with an interest @ p.a.6% calculated from the date of the complaint i.e., 01.02.2016 till the date of realisation.
3. The O.P.No.1 is further directed the pay a compensation of 5000/- towards damages, mental shock  and agonies together with a litigation expenses of Rs.2000/-.
4. Four weeks time granted to comply this order.

 

   

(Typed to our dictation then corrected, signed by us and then pronounced in the open Forum on this 07^th day of August-2017).

 

 

   Sri. Shankrappa H.                                             Sri. Jagannath Prasad                                  

Member.                                                                President.                                                                                         

                                                                          

 

 

 

Documents produced by the complainant

1. Ex.P.1-  Conformation certificate 30.07.2014 of the Revenue 

              Department.

2. Ex.P.2 to 4- Insurance perticulate.Ex.P.3- A/C/ statement (copy).
3. Ex.P.5- Certificate of premium payment.
4. Ex.P.6- Office copy of legal notice.
5. Ex.P.7 to 9- Postal receipts.
6. Ex.P10- Declaration of State Govt. of Karnataka regarding 
                    draught.
7. Ex.P.11- Collection checklist report.
8. Ex.P.12- Extract of bank account.
9. Ex.P.10-Copy of intra office correspondences.

             

 

 

 

 Document produced by the Opponent.

 

1. Ex.R.1-  Authorisation letter.
2. Ex.R.2- Reply to the legal notice.
3. Ex.R.3- Coverage and claims settled in respect of Bidar District  

              Aurad taluk.

4. Ex.R.4- Letter of Govt. of India in ministry of Agriculture and its 

              enclosures.

5. Ex.R.5- Book late regarding national crop insurance program.
6. Ex.R.6- Copy of actual yield data’s for the year 2007-2008, 2009-
                 2010, 2010-2011, 2014-2015.
7. Ex.R.7- Letter of agriculture insurance Company  India Limited to oriental bank of commerce.
8. Ex.R.8- Another letter of the Insurance Company in the bank dated 05.09.2014.
9. Ex.R.9- letter of the insurance Company to the bank 04.02.2015.
10. Ex.R.10- R.T.G.S. information date 29.07.2015 to the bank.
11. Ex.R.11- letter date 17.11.2016 of the oriental bank of commerce to A.I.C. of India.

 

 

 

Sri. Shankrappa H.                                             Sri. Jagannath Prasad                                  

       Member.                                                                      President.