PER SUBHASH CHANDRA 1. This appeal under section 19 of the Consumer Protection Act, 1986 (in short, ‘the Act’) is directed against the order dated 01.12.2017 of the Tamil Nadu State Consumer Disputes Redressal Commission, Chennai (in short, ‘the State Commission’) in CC no.40 of 2009 allowing the complaint filed by the appellant and seeking enhancement of the compensation awarded. 2. This order will also dispose of FA no.267 of 2018 filed by the respondent, as both the appeals emanate from the same order. For the sake of convenience the facts are taken from FA No.1007 of 2018, which is treated as the lead case. 3. The facts, in brief, are that the complainant is a co-pilot in Indian Airlines Corporation/ NACIL (Air India) having a policy with Bajaj Allianz General Insurance Company Ltd., for Rs.75 lakh which as on 01.01.2005, had an accrued cumulative bonus of Rs.1,50,000/-. The policy was due for renewal on 31.12.2008, accordingly, the appellant issued a cheque dated 29.12.2008 for Rs.29,128/- towards the premium drawn on the respondent Bank which had sufficient balance in his Savings Bank Account as on that date. However, when the insurer presented the cheque to its Banker viz., Standard Chartered Bank, Mumbai, the same was returned with the endorsement ‘funds insufficient’ which was belatedly intimated to the appellant on 25.02.009. On 21.02.2009, the insurer informed the appellant that the insurance had become void as the cheque for premium stood returned for insufficient funds. The appellant has contended that after he pursued the matter with the Bank at various levels, including at the level of the Chief Manager, Service Branch and the Chairman, the respondent Bank admitted that the respondent’s Bank branch had not linked the Multi Option Deposits (MOD) to the savings account which resulted in the cheque not being honoured and acknowledged the lapse on its part and offered to pay the insurance amount on behalf of the appellant. It is the contention of the appellant that the respondent had acknowledged that it failed to link the MOD linked deposits with the savings bank account and consequently, the appellant was forced to operate over 50 flights between 01.01.2009 and 20.03.2009 without the benefit of insurance cover which caused him considerable agony and anxiety and that subsequently the Bank harassed him by contending that there was no lapse on their part until finally acknowledging its lapse by tendering an apology. It is contended that apart from the fact that he was not covered for an insurance for a high risk job due to the dishonouring of the cheque on the ground of insufficient funds, the incident was derogatory and defamatory to him apart from the fact that the arrogant behavior of the Bank’s staff was also demoralizing. 4. On its part, the respondent contended that the cheque had not been honoured on account of the branch not linking the MOD to the savings bank account and that once the bank had the knowledge of its error, it offered to pay for the insurance. It is contended by the respondent that the appellant continued to have the insurance cover provided by his employer viz., NACIL and since there was no requirement of claiming any insurance, the order of the State Commission was not warranted and deserved to be set aside. 5. We have heard the learned counsel for both the parties and perused the material on record. 6. The impugned order has held that: “The complainant was put to untold hardship and mental agony when he had to fly the aircraft 50 times during the period of no insurance coverage considering the high risk job of the complainant, i.e., anything may happen at any time due to various causes like bad weather, mechanical error, engine failure and bird hit etc., to any aircraft while airborne or taking off or landing. Hence, we are of the view that it cannot be said that the complainant had not suffered any injury at all as he had suffered great mental agony and hardship for which he has to be suitably and adequately compensated. Regarding the relief of Rs.76,50,000/- under the head “Expected loss”, the learned counsel for the complainant himself is not in a position to bring the relief under the category of expected loss. Hence, as rightly contended by the learned counsel appearing for the opposite parties, this is nothing but a speculative loss or hypothetical loss which subsequently turned out to be non est. Hence, we are of the view that the complainant is not entitled to get Rs.76,50,000/- as compensation for the deficiency in service allegedly causing expected loss to the complainant. But the complainant is entitled to get reasonable compensation for the mental agony and hardship and other sufferings which cannot be described in words and which have to be undergone by a person to perceive the same. The complainant has quantified the same Rs.5,00,000/- which in our opinion would be just and reasonable considering the facts and circumstances of the case discussed supra. Hence, we hold that the complainant is entitled to receive compensation of Rs.5,00,000/- for the mental agony and other suffering meted out to him due to the deficiency in service arising out negligence committed by the 2nd opposite party. Further, the complainant is entitled to get Rs.10,000/- towards costs and this point is answered accordingly.” The impugned order has therefore, directed the respondent to jointly and severally pay Rs.5.00 lakh to the appellant within one month for mental agony and other sufferings, failing which, to pay the amount with interest @ 12% per annum till the date of payment with litigation cost of Rs.10,000/-. 7. It is seen that the impugned order has relied upon the judgment of the Hon’ble Supreme Court in Jacob Mathew vs State of Punjab and Anr. 2005(6) SCC 1 which discussed the issue of negligence and held that ‘cause of action for negligence arises only when damage occurs or damage is a necessary ingredient of this tort.’ 8. From the facts of this case, it is evident that the appellant failed to renew his insurance policy due to the respondent’s failure to link his deposits with the SB Account they were having an obligation to do. This fact is not disputed since the respondent Bank has acknowledged the same and apologized for the lapse, including offering to pay for the insurance premium on behalf of the appellant. The State Commission’s reliance on Jacob Mathew (Supra) is based upon a case of medical negligence. Its conclusion that ‘negligence’ is established only when damage is proved is based upon a judgment whose ratio cannot be applied in the instant case. The case relied upon and the facts of this case are clearly distinguishable. The instant case concerns deficiency in service. The appellant had to fly nearly 50 flights in the period in which he was without insurance cover on account of deficiency in service on the part of the respondent. The job of the appellant as a pilot/ co-pilot of an aircraft which carries passengers numbering 200 per flight in a high risk job, which comes when its attendant stress and pressure. An insurance cover, while covering the life of the appellant for the next of kin of the insured, therefore, also has implication on the lives of those who fly in the aircraft. The findings of the State Commission that negligence in this case is not established since there was no resultant damage is an argument that cannot be countenanced. In the event of a mishap having occurred, the insured would have been clearly held to be without insurance cover which would have left him or his next of kin bereft of any insurance payable. The material issue in this case whether the Bank was liable for deficiency in service on account of the cheque towards premium not being credited. 9. The action of the respondent in returning the cheque for insufficient funds when in fact there were adequate funds available in the appellant’s savings bank account, is manifestly an act which establishes deficiency in service with regard to Banking services, the respondent was required to discharge qua the appellant. It cannot seek to hide behind the argument that the claim was speculative since no need for insurance actually arose. The appellant was entitled to the services for the payment of insurance premium to the insurer for which purpose a cheque had been issued well in time and is not disputed. Once deficiency in service has been established under the appeal, the issue of speculative loss or negligence as held by the State Commission does not arise. 10. For the aforesaid reasons, we hold that the appeal has merit and is liable to succeed. As to the claim of Rs.76,50,000/- claimed by the appellant, however, it would be prudent to consider an amount that would be fair and based on equity. Considering the facts and circumstances of this case, the State Commission has considered awarding Rs.5.00 lakh towards compensation with litigation cost of Rs.10,000/-. In view of the fact that the appellant was holding a high risk policy, it would be appropriate if compensation is in the nature of damages that act as a deterrent on the bank which is a public sector bank. Expectations of service standards from which are certainly much higher. Based upon the facts of this case a compensation of Rs.15 lakh to the appellant for the deficiency in service is considered to be fair and just compensation. The respondent shall pay this amount within eight weeks failing which the amount shall be paid with interest @ 6% per annum till realization. In addition, the respondent shall also pay litigation cost of Rs.50,000/- to the appellant. 11. FA no.267 of 2018 is also disposed of in the above terms. 12. Pending IAs if any, shall stand disposed of by this order. |
