FA.No.1392/2006 against CC.No.235/2003 District Consumer Forum, Karimnagar.

Between:

The Oriental Insurance Company Limited,

Rep by its Branch Manager,

Branch Office, Karimnagar.

…Appellant/O.P.No.2.

And

1.Smt.Jagiri Rajeshwari, W/o.late Sammaiah,

   R/o.Shankarapalli,   V/o.Kataram Mandal,

   Karimnagar Dist.

…R.1/Complainant.

2.Primary Agricultural Cooperative Credit Society,

   Dhanwada,

   Post Dhanwada, V/o.Kataram Mandal,

   Karimnagar District.

…R.2/O.P.No.1.

Counsel for the Appellant         :  Mr. R.Brizmohan Singh.

Counsel for the Respondents   :  Mr.V.Gourisankara Rao.

QUORUM: HON’BLE SRI JUSTICE D.APPA RAO, PRESIDENT,

SMT.M.SHREESHA, MEMBER,

AND

SRI K.SATYANAND, MEMBER.

FRIDAY, THE NINTEENTH DAY OF JUNE,

TWO THOUSAND NINE.

Oral Order (Per Hon’ble Sri Justice D.Appa Rao, President)

*******   

1.         This is an appeal preferred by the 2^nd opposite party against the order of the District Forum, Karimnagar, directing it to pay the amount covered under the insurance policy together with interest at 9% per annum and costs of Rs.500/-.

2.         The case of the complainant in brief is that she is the wife of late Jagiri Sammaiah. When he was alive he borrowed amounts from R.1 Primary Agricultural Cooperative Credit Society, Dhanwada.  The loanees are covered under accidental benefits under insurance policy for an amount of Rs.1,00,000/-.  While so, her husband met with an accident on 06.05.1998 due to electrocution in his agricultural field at Shankarapalli and died.  On 04.06.1998 it was informed to R.1 society which in turn directed the appellant to pay the amount covered under the policy.  Since her claim was not settled, she filed complaint claiming Rs.1,00,000/- together with interest at 24% per annum from the date of claim till the date of realization, besides compensation of Rs.10,000/- and costs of Rs.5,000/-.

3.         R.1, the Primary Agricultural Cooperative Credit Society, filed counter.  It admitted that Sammaiah, the husband of the complainant had availed a loan of Rs.4,000/-from the society on 23.11.1988 for development of well besides another loan of Rs.5,600.- on 31.03.1992.  He had to pay Rs.7,430/- towards principal and Rs.6,500/- towards interest, in all Rs.13,90/-.  There was no agreement between the borrower and the society or between the society and the insurance company or between the borrowers and insurance company covering their risk.  It did not collect any amount towards coverage of insurance policy from the complainant’s husband during his life time.  There is no scheme to pay insurance premium by the society on behalf of the borrowers.  There was a proposal by the A.P. Cooperative Banks Association in the year 1998 to collect the premium in order to cover the insurance policy but never came into existence.  However, there was no policy in the instant case.  At any rate, the complaint is barred by limitation and therefore, prayed for dismissal of the complaint. 

4.         R.2, the Insurance Company, filed counter alleging that it did not receive any amount from R.1 covering the risk of borrower, nor issued any policy.  Since there was no insurance policy issued by it, it was not liable to pay any amount.  The claim is unjust and without any basis, and therefore, prayed for dismissal of the complaint.

5.         The complainant in proof of her case filed her affidavit and got Exs.A.1 to A.7 marked.  Refuting their evidence, R.1 society filed affidavit of its Secretary, whereas the appellant filed affidavit of its Sr. Divisional Manager.

   6.      The District Forum after considering the evidence place on record opined that Exs.A.4 and A.5 show that the R.1 requested the Insurance Company to give financial assistance to the deceased, one of the borrowers of their society.  From this it deduced that there was an insurance coverage for the loanees and therefore, it directed both R.1 and R.2 to pay the amount covered under the policy with interest at 9% per annum.

7.         Aggrieved by the said order, the Insurance Company preferred this appeal contending that the District Forum did not appreciate the facts in correct perspective.  It ought to have seen that there was no insurance policy covering the risk of the deceased.  Ex.A.4 does not in any way disclose that the policy was given to the R.1 covering the risk of loanees.  Therefore, it prayed that the appeal be allowed.

8.         The point that arises for consideration is whether the Insurance Company had issued any policy covering the risk of the deceased in order to award the amount?

9.         At the outset, we may state that exfacie there is no insurance policy issued by the appellant in favour of R.1 society covering the risk of loanees who borrowed amounts from R.1 society.  The very society did not admit that insurance policy was taken covering the risk of the loanees.  What all it was stated was that there was a proposal by the A.P. Cooperative Banks Association to collect the premium, however, it was not fructified.  When the complainant requested the society to address letter to the insurance company to give financial assistance on the ground that her husband died in accident wherein he was electrocuted and died, the same was forwarded to the insurance company.  From this it cannot be deduced that a policy was issued by the appellant and the risk of the deceased was covered by the insurance policy, more so, when the very society denied having taken any policy covering the risk of the deceased.  Absolutely, there is no evidence whatsoever to state that there was insurance policy covering the risk of the deceased.  At no time any premium was paid.  The appellant is not liable to pay the amount as there was no insurance policy.  Since there is no policy, whatsoever, the complainant is not entitled to the amount claimed.

10.       In the result, the appeal is allowed setting aside the order of the District Forum.  Consequently, the complaint is dismissed.  However, in the circumstances no costs.        

                      PRESIDENT   

MEMBER   

MEMBER

DT: 19.06.2009