BEFORE THE KARNATAKA STATE CONSUMER DISPUTES REDRESSAL COMMISSION, BANGALORE (ADDL. BENCH)

DATED THIS THE 11^th DAY OF JULY, 2023

PRESENT

SRI.RAVISHANKAR, JUDICIAL MEMBER

SMT.SUNITA C. BAGEWADI, MEMBER

Appeal No.212/2018 TO 222/2018

Agriculture Insurance Company of India Ltd.
Regional Office, III Floor, Krishi Bhavana
Building No.18, Nrupathunga Road,                          ...Appellant/s
Bangalore-560 001.                                   

Represented by its Manager

(Appellant is common in all the appeals)

(By Sri.Pulikeshi Upanal, Advocate)

-V/s-

1.     Appeal No.212/2018

        1.     Smt.Shanta Bai w/o Laxman

        2.     Shevanata Bai w/o Bhimarao,

                Aged by major & Agriculturists

                R/o Dabka © village,                                .. Respondent/s

                Taluk: Aurad, Bidar Dist-585401

        3.     Branch Manager,

                Prathamika Krashika Pattina

                Sahakar Sangha Niyamitha,

                Dabaka village, Aurad Taluk

Bidar District-585 401

2.     Appeal No.213/2018

        1.     Laxman S/o Reda

        2.     Praveen S/o Keraba

                Age by Majors  & Agriculturists

                R/o: Dabka (c) village,                     .. Respondent/s

                Taluk: Aurad,

Bidar District -585401

        3.     Branch Manager,

                Prathamika Krashika Pattina

                Sahakar Sangha Niyamitha,

                Dabaka village, Aurad Taluk

Bidar District-585 401

3.     Appeal No.214/2018

        1.     Shanta Bai w/o Avinash

                Age by Majors & Agriculturists

                R/o: Ganganbhid, Taluk Aurad,

Bidar District-585 401

        2.     Rashika Bai w/o Bhanudas,

                Age by Majors  & Agriculturists  

                R/o: Aknapur, Taluk Aurad,

Bidar District-585401

3.     Branch Manager,

                Prathamika Krashika Pattina

                Sahakar Sangha Niyamitha,

                Dabaka village, Aurad Taluk

Bidar District-585 401

4.     Appeal No.215/2018

        1.     Sri Suresh S/o Rajendra

                Age by Majors & Agriculturists

                R/o: Dabka, Taluk: Aurad                       .. Respondent/s

Bidar District -585401

2.     Branch Manager,

                Prathamika Krashika Pattina

                Sahakar Sangha Niyamitha,

                Dabaka village, Aurad Taluk

Bidar District-585 401

5.     Appeal No.216/2018

        1.     Sri.Apparao S/o Dhondiba

                Age by Majors & Agriculturists

                R/o: Dabka, Taluk: Aurad                      

Bidar District -585401

2.     Branch Manager,

                Prathamika Krashika Pattina

                Sahakar Sangha Niyamitha,

                Dabaka village, Aurad Taluk

Bidar District-585 401

6.     Appeal No.217/2018

        1.     SriVishwanath S/o Bhivajee

                Age by Majors & Agriculturists

                R/o: Dongapur, Taluk: Bhalki,                       

Bidar District -585401

2.     Branch Manager,

                Prathamika Krashika Pattina

                Sahakar Sangha Niyamitha,

                Dabaka village, Aurad Taluk

Bidar District-585 401

7.     Appeal No.218/2018

        1.     Sri.Ganapati S/o Shivalingappa Hugar.

                Age by Majors & Agriculturists

                R/o: Dongapur, Taluk: Bhalki,                       

Bidar District -585401

.. Respondent/s

2.     Branch Manager,

                Prathamika Krashika Pattina

                Sahakar Sangha Niyamitha,

                Dabaka village, Aurad Taluk

Bidar District-585 401

8.     Appeal No.219/2018

        1.     Smt.Lalitha Bai W/o Rohi Das, 

                Age by Majors & Agriculturists

                R/o: Dongapur, Taluk: Bhalki,                       

Bidar District -585401

2.     Branch Manager,

                Prathamika Krashika Pattina

                Sahakar Sangha Niyamitha,

                Dabaka village, Aurad Taluk

Bidar District-585 401

9.     Appeal No.220/2018

        1.     Sri.Dayanand S/o Prabhu Shetty,

                Age by Majors & Agriculturists

                R/o: Dongapur, Taluk: Bhalki,                       

Bidar District -585401

2.     Branch Manager,

                Prathamika Krashika Pattina

                Sahakar Sangha Niyamitha,

                Dabaka village, Aurad Taluk

Bidar District-585 401

10.   Appeal No.221/2018

        1.     Smt.Sulochana w/o Digamber,

                Age by Majors & Agriculturists

                R/o: Dongapur, Taluk: Bhalki,                       

Bidar District -585401

.. Respondent/s

2.     Branch Manager,

                Prathamika Krashika Pattina

                Sahakar Sangha Niyamitha,

                Dabaka village, Aurad Taluk

Bidar District-585 401

11.   Appeal No.222/2018

        1.     Smt.Kamal Bai w/o Malappa,

                Age by Majors & Agriculturists

                R/o: Dongapur, Taluk: Bhalki,                       

Bidar District -585401

2.     Branch Manager,

                Prathamika Krashika Pattina

                Sahakar Sangha Niyamitha,

                Dabaka village, Aurad Taluk

Bidar District-585 401

(Resp.No.1- By Sri.Bandagar Shivaji, Advocate)

C O M M O N   O R D E R

BY SMT.SUNITA C. BAGEWADI, MEMBER

The Appellant/Opposite Party No.1 being aggrieved by the order dated 06-01-2018 passed by the District Consumer Commission, Bidar in Complaint Nos.108/2016 to 112/2016 and Complaint Nos.06/2017 to 11/2017 respectively.

          2. The Appellant/Opposite Party No.1 are the same in all these Appeals and the facts involved in these Appeals are one and the same.  Hence, these Appeals are taken up together and are being disposed of by a common order.  

          3. The brief facts of the complaints are that  the Govt. of India introduced the scheme starting for Rabi 1999-2000 season to protect the farmers against loss suffered by them due to crop failure on account of natural calamities.  The scheme is available to the farmers who were loanees and non-loanees.    The complainants have insured the Soya crop for the year 2015-16 (Khariff) under the scheme of National agricultural insurance (NAIS) of Opposite Party and paid the premium through Prathamik Krashik Pattin Sahakar Sang Niyamit.   Due to lack of rainfall in the year 2015-16, the entire Soya crop was damaged, for which the complainants suffered heavy loss.  The State Government had declared the year 2015-16 as drought affected and released funds to the farmers of Bidar district.   The complainants and other farmers of the village Dabka, Chikli, Gangan Bhid, Aknapur and Dongapur have made request to settle the claim to the Deputy Commissioner, Bidar, District In-charge Minister and Union Agricultural Minister.  In spite of request of the complainants, the Opposite Parties have not settled the genuine claim of the complainants.   The Opposite Parties willfully, deliberately and intentionally have not settled the claim, which resulted in deficiency in service on the part of the Opposite Parties.   Hence, the complainants alleging deficiency service and filed the complaints seeking relief.

4. The Opposite Party/Agriculture Insurance Company filed their version contending that, the complaint is not maintainable as there is an insufficient, improper and inconsistent pleading.    The Opposite Party denied that the complainants are the absolute owners and possessors of the alleged insured lands situated at Chikli (U) of Dabka(C) hobli in Aurad taluk and Dongapur hobli and Bhalki taluk.   It is submitted that, as per the scheme, payment of premium, sum insured, insured area and other details of the individual farmers are to be confirmed by the Nodal Bank only, by producing the relevant documents.  The role of the bank is to receive the premium amount, with concerned documents and send them to Nodal Bank to prepare and forward the consolidated declaration to the AIC for conclusion of contract.   The Govt. of India, the Govt. of Karnataka and Nodal Bank are not made parties, hence the complaints are bad for non-joinder of necessary parties.   The rights and liabilities of the insured are strictly governed by the terms and conditions of the scheme and all such terms and conditions are binding upon the insurer also.   The scheme NAIS is being implemented on the basis of “Area approach”, which means if the actual yield per hectare of the insured crop for the notified crop area on the basis of requisite number of Crop Cutting Experiments in the insured season falls short of the specified “Threshold Yield”, all the insured farmers growing that crop in the notified area are deemed to have suffered shortfall in their yield.   The compensation if any is calculated as per the following formula,

Shortfall in Yield / Threshold Yield X Sum Insured for the farmer

(Shortfall in Yield = ‘Threshold yield – Actual yield’ for the Defined Area)

 As per the decision taken in the SLCCCI meeting during 2015-Kharif season, “Threshold Yields” for rain fed crops the moving average yield i.e., 998.2 kg and 1056.64 kg / Hectare based on 5 years average yield multiplied by 80% level of indemnity working out to 799 kg and 1320.80 kg/ Hectare were fixed respectively in Dabka (C) Hobli and Dongapur, Bhalki taluk during 2015-kharif season.   The Opposite Party denied that, during 2015-kharif season, there was complete drought and as a result of drought itself, the complainants lost their insured crops, because as per the yield data based on crop cutting experiments conducted by the Karnataka State Govt., in respect of rain fed Soya bean crops during 2015-kharif season is as follows;

 As per the above data, there was no shortfall in yield in respect of rain fed Soya bean crop.  The Opposite Party has already settled the eligible claims as per the declaration sent by Nodal Banks, hence, there was no claim pending to be settled as alleged by the complainant.   The claims under NAIS if any will be settled only on the basis of yield data furnished by Directorate of Economics and Statistics arrived at regular thorough crop estimation surveys for crop insurance as well as production of estimates and not on any other basis such as Annavari, declaration of drought, declaration of floods, Gazette notification etc., by any department or authority.    In case, a farmer is deprived of any benefit under the scheme due to errors/omissions/commissions of the Nodal Bank/Branch/PACS, the concerned institution shall only make good all such losses.   The Opposite Party further submitted that, as there was no eligible claims to be settled in the area of complainant’s in respect of rain fed Soya bean Khariff crop during 2015 Khariff season, there was no question of settling the claim as contended by the complainants and since the Opposite Party has acted as per the mandatory scheme provisions of the scheme, the service of the O.P. is not at all deficient.   There is no cause of action arose to file the complaint.  Therefore, the complaints are devoid of merits and substances.  Hence, Opposite Party prays to dismiss the complaint with costs.

          5.  After trial, the District Consumer Commission has allowed the complaints in part and directed the Opposite Party to reimburse the sum insured together with an interest @6% p.a. calculated from the dates of the individual complaint till the date of realization and to pay compensation of Rs.5,000/- towards deficiency in service and Rs.2,000/- towards litigation expenses. 

6. Being aggrieved by the said order, the Opposite Party No.1/Agricultural Insurance Company has filed these Appeals before this Commission.

7. We have heard the arguments from both parties.

8. Perused the appeal memo, the order passed by the District Consumer Commission, we noticed that, it is not in disputed that the respondents had obtained crop insurance from the appellant company with respect of Soya bean crop for Khariff season for year 2015-16. However on account of shortfall/crop, the crops did not give sufficient yield. Subsequently the respondents claimed the insurance, but the Appellant Company has not settled the claim of the respondents.  

9. The contention of the appellant in appeal memo and in course of arguments that there was no short fall on that particular year and the respondents not submitted any substantial documents or report which was essential to assess the due short fall. Moreover without any calculation as per the rules and regulations of NAIS scheme, the District Consumer Commission has passed the order. Perused the order passed by the District Consumer Commission, we noticed that, the District Consumer Commission has passed the order without considering the crop cutting experiment report of the Directorate of Economics and Statistics department and without fixing amount as per the acres order to pay sum assured amount to the respondent. The District Consumer Commission has to relied upon the crop cutting experiment report of Directorate of Economics and Statistics to assess what is the actual loss to each famer if any suffered by taking details from the farmers and fix the compensation. The District Consumer Commission relied on a decision of the Hon’ble Supreme Court in Smt.Shashi Gupta –vs- Life Insurance Corporation of India and Anr. I (1996) CPJ 15 (SC) = 1995 Supp. (1) SCC 754 and passed the order which is not just and proper because in the said decision, the Hon’ble Supreme Court of India has discussed about the life insurance which is not applicable to this case. Moreover without going through the terms and conditions of NAIS scheme and guidelines issued in this regard passed the order basing on decisions and sympathies towards the respondents. Moreover, the respondent has to make the Government as a party to the proceedings because the government is a necessary party and also there is no clear mention regarding how much amount has to be paid by the appellant to each respondent. In this circumstance, all these matters are requires to be remanded to the District Consumer Commission to reassess the loss suffered to each farmer as per the crop cutting report on account of failure of crops depending upon the yield notification and also price index. Interim order only directing the appellant to pay sum assured is not just and proper as there is no clear mention regarding how much amount has to be paid. Accordingly, the appeals are allowed.  

O R D E R

The Appeal Nos.212/2018 to 222/2018 are allowed. No order as to cost.

The impugned order passed by the District Consumer Commission, Bidar in complaint Nos.108/2016 to 112/2016 and complaint Nos.06/2017 to 11/2017 dated 06-01-2018 is hereby set aside and the matters are hereby remanded to the District Consumer Commission to dispose of the case afresh in accordance with law.

The amount in deposit shall be transmitted to the District Consumer Commission to disburse the same to the complainants soon after modifying the award in accordance with law.

         Keep the original of this order in appeal No.212/2018 and copies thereof in connected files.

MEMBER                                                  JUDICIAL MEMBER

Jrk/-