A.P. STATE CONSUMER DISPUTES REDRESSAL COMMISSION
HYDERABAD.
F. A 1710/2007 against C.C. 138/2004, Dist. Forum, Karimnagar
Between:
Yeladandi Bakkaiah
S/o. Mallaiah
Weaver, H.No. 8-5-33/3/1
Pragathinagar Locality
Sircilla, Karimnagar Dist. *** Appellant/
Complainant.
And
The Branch Manager
The Sircilla Co-operative Urban Bank Ltd.
Sircilla, Karimnagar Dist. *** Respondent/
Op.
Counsel for the Appellant: M/s. K. Mogulappa.
Counsel for the Resp: M/s. K. Lakshman
CORAM:
HON’BLE SRI JUSTICE D. APPA RAO, PRESIDENT
SMT. M. SHREESHA, MEMBER
&
SRI K. SATYANAND, MEMBER
THURSDAY, THE FOURTH DAY OF MARCH TWO THOUSAND TEN
Oral Order: (Per Hon’ble Justice D. Appa Rao, President)
*****
1) Unsuccessful complainant is the appellant.
2) The case of the complainant in brief is that his father late Yeldandi Ashok had obtained a loan of Rs. 5,000/- on 22.8.2000 from the respondent bank wherein it had collected Rs. 10/- towards membership, Rs. 25/- towards insurance and Rs. 20/- towards incidental charges with an understanding that if the loanee dies during the loan period his legal heirs would be entitled to insurance claim of Rs. 50,000/-. He died on 1.9.2000. Later the bank started making demands to repay the loan for which he requested the bank to settle the insurance claim and pay the amount after deducting the amounts due to the loan account payable by his father. Having collected the insurance premium it was the bounden duty of the bank to deduct the insurance amount. When they refused to waive the loan, he got issued a legal notice for which they gave reply stating that as his father died before 5th of succeeding month not eligible for claiming the insurance amount. Therefore he filed the complaint to settle the claim of insurance after deducting the said amount from the loan account, and pay remaining balance together with compensation and costs.
3) The respondent bank resisted the claim. However, it admitted that it had collected Rs. 25/- towards insurance premium for coverage of accidental death only for loanees for an amount of Rs. 10,000/- for a period of two years under Group Janata Personal Accident policy (herein after called JPA policy). It never made any offer to insure the life of borrowers for Rs. 50,000/-. It carries on banking business and it does not carry business of insurance. In order to promote its business it undertook to render additional service to its members by covering their risk under JPA policy launched by insurance companies for which no remuneration or commission is charged. It is a gratuitous service. As per the scheme it had to send the premium amount by 5th of every month enclosing the list of loanees from whom premium amounts were collected in the preceding month. After receipt of premium amount the insurance company would issue insurance policy in respect of said loanees. When it had collected Rs. 20/- towards premium of group insurance scheme on 22.8.2000 it included the name of T. Ashok in the list of loanees to be forwarded to the insurance company on 5.9.2000, however in the meantime on 1.9.2000 itself T. Ashok died. The insurance policy was not even issued. There is no coverage of insurance by the date of his death. At any rate the policy covers only death due to accident and not due to natural causes. Since his death was not accidental the complainant was not entitled to any amount. There is no deficiency of service on its part. The complaint was filed beyond two years from the date of cause of action as it arose on 1.9.2000 i.e., the death of T. Ashok. The complaint was barred by limitation u/s 24A of the Consumer Protection Act and therefore it prayed for dismissal of the complaint with costs.
4) The complainant in proof of his case filed his affidavit evidence and got Exs. A1 to A14 marked while the respondent filed the affidavit evidence of its Chief Executive Officer and did not file any documents.
5) The Dist. Forum after considering the evidence placed on record opined that no insurance policy was issued to the account holder and as the loanee died even before issuance of policy and as there was no coverage of insurance on the date of death of the deceased dismissed the complaint.
6) Aggrieved by the said order, the complainant preferred the appeal contending that the Dist. Forum did not appreciate the facts or law in correct perspective. It ought to have seen that the bank had collected the premium and that the death of the deceased was accidental and therefore he was entitled to the benefits. His name was included in the list to be forwarded on 5.9.2000. He was entitled to the benefits under the JPA scheme.
7) The point that arises for consideration is whether the order of the Dist. Forum is vitiated by mis-appreciation of fact or law?
8) It is an undisputed fact that the complainant’s father T. Ashok had barrowed Rs. 5,000/- from the respondent bank. He being a loanee entitled to JPA policy. The bank in fact collected Rs. 20/- on the date of sanction of loan on 22.8.2000 for coverage of accidental death for an amount of Rs. 10,000/- under JPA policy. Though the complainant asserted that the coverage is for Rs. 50,000/- he could not prove the said fact. Unfortunately the bank which alleged that the coverage is only for Rs. 10,000/- equally did not file any document.
Be that as it may, the complainant in order to prove that his father died in an accident filed the FIR Ex. A11 to prove that while he was going on his motorcycle, met with accident, when a lorry dashed against him. Basing on which a case in Crime No. 108/2000 u/s 304A, 337 was registered. Inquest was conducted evidenced under Ex. A12 wherein the inquestadars were of the opinion that Ashok died in a motorcycle accident on 1.9.2000. The post-mortem examination was also conducted evidenced under Ex. A13 on the body of the deceased and the doctors were of the opinion that he died of ‘shock and haemorrhage due to multiple injuries’ followed by accident report by the Motor Vehicles Inspector vide Ex. A14.
9) The bank alleges that as per the terms of the policy, the premium amount collected from the loanees would be sent to the insurance company along with names of the loanees on 5.9.2000. In other words, the premium amounts collected from the loanees in a particular month would be sent on 5th of every succeeding month and the insurance company based on it would issue policy. Whether the name of T. Ashok was made a mention or not, the insurance company did not issue any policy. It did not even receive any amount as admitted by the bank. No policy whatsoever was issued covering the risk of the deceased. The question of payment of insurance amount nor adjusting the said amount towards loan account would not matter much. It is fundamental that no amount need be paid by the insurance company or by the bank till the policy was issued in favour of the assured. There is no binding contract to fasten liability on the bank or the insurance company. We do not see any mis-appreciation of fact and law by the Dist. Forum in this regard. We do not see any merits in the appeal.
10) In the result the appeal is dismissed. No costs.
1) _______________________________
PRESIDENT
2) ________________________________
MEMBER
3) ________________________________
MEMBER
Dt. 04. 03. 2010.
*pnr
“UP LOAD – O.K.”
