CONSUMER DISPUTES REDRESSAL FORUM    PALAKKAD

Dated this the 21^st  day of June 2014

PRESENT :  SMT. SEENA. H, PRESIDENT

                   :  SMT.  SHINY. P.R, MEMBER

                   :  SMT. SUMA. K.P, MEMBER                                        Date  of filing:24/08/2013

                                                            CC /  138 / 2013

Sajeevan.K,

S/o.Kuttan, Perinchery,

Mangode, Tathamangalam Village,

Chittur Taluk,  Palakkad District,                                            :           Complainant

Pin:- 678 102

(By Adv.A.Manoj)

Vs

1. Agricultural Insurance Company

of India Limited (AIC),

 Regional Office (Kerala),

T.C.14/1765 (Grand Floor),

Vazhuthakad Road, Bakery Junction,

             Thiruvananthapuram 695 014.

(By Adv.K.Lakshminarayanan)

1. The General Manger,

District Co-operative Bank Opposite parties

College Road, Palakkad.

(By Adv.M.S.Skaria)

1. The Secretary,

Tathamangalam Service Co-operative Bank Ltd.,

P.502, Mettupalayam, Thathamangalam P.O,

Chittur Taluk.

(By Adv.T.Raghu)

O R D E R

By Smt. Suma. K.P, Member,

Brief case of the complaint :-

The complainant in this case is an agriculturist who had paddy cultivation in 4.83 acres in Tathamangalam Village.  He had availed – Crop  Agricultural loan from Tathamangalam Service Co-operative Bank Ltd, 502, Mettupalayam, Tathamangalam P.O, Chittur Taluk for cultivation.  At the time of availing the agricultural loan the complainant was insisted to insure  the last crop (second) with the 1^st opposite party Agriculture Insurance Company of India Limited on weather based crop insurance scheme.  The complainant was told to pay premium towards the above scheme stating the pre condition to insure the crop with the insurer at the instance of the District Co-operative Bank and NABARD,  for the credit facility and was asked to pay the premium of Rs.766/- towards the scheme on 19-12-2012 as it was mandatory for availing the agricultural loan.  According to the scheme the 1^st opposite party has to indemnify the complainant @ 20,000/- per hectare, for crop loss.  Complainant states that he has lost his entire paddy crops due to severe draught.  Complainant brought in to the notice of the officers of the Agricultural Department about the damage caused to the cultivation and the losses incurred.  The insurance company was duty bound to assess the situation and damage to the agriculture and loss incurred to the complainant.  But the 1^st opposite party denied to indemnify the loss to the complainant which according to the complainant is a grave deficiency in service.  No amount was paid to the complainant for the loss in crop.  The complainant has right to receive Rs.40,000/- from the insurance company for the total crop loss.  Hence the complainant has approached before the Forum seeking the order directing the 1^st opposite party to pay sum of Rs.40,000/- on account of the loss sustained to the complainant’s crops along with such other relief.

Notice was issued to opposite parties.  Opposite parties entered appearance through the respective counsel and filed their version contenting the following.  Opposite party No.1 contented that Government of Kerala as per its order dtd.27/10/1999 accepted the National Agricultural Insurance Scheme(NAIS) propounded by the Central Government. It is submitted that NAIS has been formulated on the basis of recommendations of various expert committees and reports of specialist on the subject.  The scheme is purely a social welfare measure and 1^st opposite party is acting merely as an agent of Central Government for the purpose of administering the scheme.  The Scheme has been formulated with the following objectives:

1. To provide insurance coverage and financial support to the farmers in the event of failure of any of the notified crop as a result of natural calamities, pests & diseases;
2. To encourage the farmers to adopt progressive farming practices and higher technology in Agriculture and
3. To help stabilize farm-income, particularly in disaster years.

In the instant case complainant had filed the complaint stating that he has availed crop loan for cultivating 4.83 acres of paddy crop from Tathamangalam Service Co-operative Bank and had paid Rs.766/- as premium towards insurance for the said crop  and had lost his entire crop due to draught and he had convinced the officers of Agriculture Department about the situation.  The nodal bank i.e 2^nd opposite party has to confirm the coverage of complaint under NAIS including the Season, Crop, Notified Area, Premium Paid and Sum Insured since AIC is receiving only consolidated Declarations as per Scheme norms.  1^st opposite party will not have any details of individual farmers.  Claim is solely and strictly based on the Main Yield Data submitted by the Department of Economics and Statistics as mentioned and no other loss assessment procedure/ certificate is valid.  Hence AIC need not inspect the vide spread loss in the area.  This is a scheme approved and implemented by the Government.  The details of Yield Data submitted by DES for Rabi I (2012-13 Season).  All the insured farmers in Chittur-Tathamangalm Notified Zone is eligible for 39% claim based on their respective sum insured as per the scheme.  On receipt of the State Share of Liabilities claim amount will be disbursed/credited to the account of the Nodal Bank and they will disburse the same to the insured.  There is no willful default or latches.  There is no deficiency of service on the part of 1^st opposite party the insured is entitled to get the insurance amount as per the scheme approved.  There is no delay in the process.  The complaint is premature.  AIC has processed all the eligible claims for the paddy for Rabi1 2012-13 and the competent authority has already accorded sanction for the same and would effect payment on receipt of State Government Share of Liabilities for the said Season.

The 2^nd opposite party contented that they are unnecessary party to proceedings and the complainant had not claimed any compensation from them.  The complainant had paid the premium amount to 3^rd opposite party from whom the 2^nd opposite party collected the said amount to 1^st opposite party without any delay.  2^nd opposite party had not given any service to the complainant nor had committed any deficiency of service.  2^nd opposite party had acted only as an agency in connecting the 3^rd opposite party with the 1^st opposite party.  The complainant had not proved that the loss was sustained to him.  2^nd opposite party is in no way responsible for payment of any compensation to the complainant and they had to be exhonerated.  The 3^rd opposite party had also stated that they are only a collecting bank working under direct control and guidance of the 2^nd opposite party herein.  As per the circular issued by the 2^nd opposite party dt.14/12/12, the 3^rd opposite party has collected Agricultural Insurance Premium amount from the complainant and the collected amount was duly remitted with the 2^nd opposite party without any delay or default.  There is no deficiency of service from the part of 3^rd opposite party and has no obligation or liability with regard to the compensation or damages sought for in the complaint.  Hence 3^rd opposite party  may be relieved from all the liability put forth in the complaint.

Complainant filed application to call for the document (Policy document) from opposite party no.1.  Application was allowed.  Opposite party neither produced the document nor filed any affidavit.  Complainant filed chief affidavit.  Opposite parties 1-3 also filed chief affidavit along with documents.  Ext.B1-B8 was marked from the side of opposite party.

Issues for consideration.

1. Whether there is any deficiency of service on the part of opposite parties?
2. If so, what are the reliefs to be granted to the complainant?

Issue No.1&2

  Matter was heard. We perused all the relevant documents produced before the Forum.  Complainant in the chief affidavit had stated that during the  pendency of this complaint Insurance Company has credited Rs.19,626/- to his bank account so as to settle his loss of the crop.  But according to the complainant he is entitled to get Rs.20,000/- per hectare.  So that the insurance company is bound to pay the balance amount of Rs.20,374/- so as to settle his claim.  Ext.B1 is the order of Government of Kerala dtd.27/10/19999 accepted by NAIS and the operation modality and guidelines to financial institution as detailed by the Ministry of Agriculture, Government of India vide letter dtd.16-7-1999 was marked as Ext.B2.  According to the scheme the confirmation regarding coverage of a particular farmer in a particular notified area for a particular notified crop has to be furnished by the nodal officers of the branches who have disbursed SAO loans covered and in the present case the nodal office is opposite party no.3.  In the absence of such documentary evidence  the 1^st opposite party denies that the paddy crop of the complainant was covered under NAIS.  State Government conducts crop cutting experiments in all the notified area every season, through its Department of Economics and Statistics to assess actual yield per hectare. Before notification Threshold Yield per hectare are first calculated for each notified area by multiplying Level of Indemnity % (60, 80 or 90 as adopted by the SLCCCI) with the average yield during the preceding Three years/Five Years as the case may be, in that notified area. The seasonal actual yield computed for each area by the State Government are compared against the threshold yield calculated for that area, to find shortfall if any, in respect of the crop/notified area for the season.  If there is a shortfall in yield in any particular notified area in a season, each of the eligible insured farmers in that notified area will be eligible for indemnity, which is calculated as under:

Shortfall in Yield

X Sum Insured

Threshold Yield

(Threshold Yield= Average of preceding 3/5 respective seasons Actual Yield  multiplied by the Level of Indemnity for current season for the particular crop)

(Level of Indemnity is the percentage to be applied to last 3/5 years’ average yield based on the yield data variability of the yester years.)

(Shortfall = Threshold Yield  - Actual Yield)

(Sum Insured for Loanee Farmers, as per NAIS provisions, should be atleast equivalent to the loans amount disbursed during the season within stipulated cut – of dates)

Claims as calculated above for each season are routed to farmers through the respective nodal offices and in turn to the bank branches/PACS,  after being duly sanctioned by the Competent Authority and after receipt of funds from the State Government and the Central Governments being their share of seasonal liabilities.  It is also submitted that in view of the specific mandate of the Scheme as explained above as also the administrative approval of the Govt. of India, no other certificate or assessment/procedure for loss assessment by any authority shall hold good for indemnification under the Scheme.  In the instant case, the complainant has filed a complaint stating that he has availed Crop Loan for cultivating 4.83 acres of Paddy Crop from Thathamanglam SCB on 19/12/2012 (Rabi I 2012-13) and the SCB has insisted to pay Rs.766/- as Premium towards an insurance for the said Crop.  The complainant has stated that he has lost his entire paddy crop due to drought and that the complainant has convinced the officers of Agriculture Department about the situation.  The Nodal Bank i.e. the District Co-operative Bank has to confirm the coverage of the complainant under NAIS including the Season, Crop, Notified Area, Premium Paid and Sum Insured since  AIC is receiving only consolidated Declarations as per Scheme norms.  The claim is solely & Strictly based on the Mean Yield Data submitted by the Department of Economics and Statistics as mentioned above and no other loss assessment procedure/certificate is valid.  Hence the complaint of the party that AIC not even cared to inspect the widespread loss in the area is baseless and irrational.  As per the complaint the party has availed loan on 19/12/2012 and if this is correct subject to confirmation by the Nodal Bank and also assuming that his paddy cultivation is in Chittur-Thathamangalam Notified Zone we would like to submit the details of claim eligibility calculated as per Scheme norms.

For Rabi I 2012-2013 Season all the insured farmers in Chittur Thathamangalam Notified Zone is eligible for 39% claim based on their respective Sum Insured as per the scheme.  The amount has to be paid by the government of Kerala and so far the subsidy amount is not forwarded to the company.  On receipt of the amount the loss assessed and allowed will be credited to the account of the Nodal bank and they will disburse the same to the Insured.  There is no deficiency of service on the part of the opposite party.  There is no willful default or latches.  The complaint is premature.  The insured is entitled to get the insurance amount as per the scheme approved supra.  There is no delay in process.  The alleged delay is due to the non-receipt of the State Share of liabilities for the particular Season to the company.  After filing of this case the amount determined as per the scheme was calculated and the same was credited to the account of the complainant.  The Forum is not in a position to determine what was the actual loss incurred by the complainant due to the lack of evidence produced.  Since opposite party No.1 had credited the eligible claim as per the scheme towards the complainant’s account we cannot  attribute deficiency of service on the part of the opposite parties. Moreover, the claim for compensation of Rs.40,000/- was not substantiated by the complainant with any documentary evidence.  In the above circumstances the complaint is dismissed without cost.

Pronounced in the open court on this the 21^st   day of June 2014

                                                                                                               Sd/-

                                                                                                            Smt. Seena. H

                                                                                                              President

                                                                                                                Sd/-

                                                                                                            Smt. Shiny. P.R

                                                                                                              Member

                                                                                                                Sd/-

                                                                                                            Smt. Suma. K.P

                                                                                                               Member

                                                            A P P E N D I X

Exhibits marked on the side of the complainant

Ext.A1  -  NIL

Exhibits marked on the side of the opposite party

Ext. B1 – Copy of Kerala Govt.Order (MS) No.304/99 AD dated 27.10.1999.

Ext. B2 –  Govt. Of India, Ministry of Agriculture Letter No.13011/15/99-Credit II dated               16/07/1999 enclosing Scheme copy/Operational Modalities and FAQ on NAIS.

Ext. B3 –  Govt. Of India, Ministry of Agriculture Letter No.13011/04/2004-Credit II dated               6/02/2012

Ext. B4 –  Copy of Kerala Govt. Order No.GO(Rt.) No.2242/2012/AD dated 17/11/2012.

Ext. B5 –  Copy of Notification Guidelines for Rabi 2012-13 Season.

Ext.B6 -  Specimen copy of the Declaration Format for Loanee farmers under NAIS.

Ext.B7-  Details of Mean Yield Data submitted by DES for Rabi I 2012-2013 Season.

Ext.B8-  Details of Threshold Yield calculation  for Rabi I 2012-2013 Season.

Witness examined on the side of complainant

Nil

 Witness examined on the side of opposite parties

Nil 

Cost allowed

Nil