2.       The brief facts of the case are that the complainant is a farmer and had purchased tractor and trolly. That, to obtain insurance policy of the said tractor and trolly he had issued to the Insurance Company  bank cheque No.484212 dated 31.12.2005 amounting to Rs.1835/- drawn on the appellant bank towards the insurance premium. Accordingly, respondent Insurance Company had issued policy cover note bearing NO.602971 for the insurance sum of Rs.1 lakh which was valid for the period of 31.12.2005 to 30.12.2006. That, this cheque was sent for clearance on 6.1.2006 by the Insurance Company to the appellant bank when there was a balance of Rs.2781.50 in his account No.15482 with the appellant bank. It was contended that in the midnight of 23.8.2006 and 24.8.2006 his tractor and trolly was stolen.  The said incidence was reported to the police and crime No.379 was also registered.  That following incidence of theft of said tractor and trolly insurance claim was submitted to the Insurance Company i.e. respondent No.2 herein.  However the said claim was repudiated by the company vide it`s letter dated 25.9.2006 on the ground that the cheque through which the amount of premium was paid was dishonoured and hence policy was cancelled. Therefore  alleging deficiency in service on the part of Insurance Company he had filed consumer complaint No.84/06 with the District Forum against the Insurance Company along with agent of the said Insurance Company  and tractor agency. However the said complaint came to be dismissed by majority judgment dated 31.5.2007 in which the observations were made that the cheque was dishonoured by appellant bank which was not party in the complaint. Hence Insurance Company was not held liable to pay insurance sum and complainant was directed to seek relief in the competent court. 

3.       The complainant thereafter filed another complaint bearing No.61/2007 against the appellant bank along with Insurance Company. It was contended that although there was sufficient balance in his account as mentioned above the appellant bank had dishonoured the cheque whereby depriving him benefit under the said insurance policy.  He had therefore  sought direction under the said complaint to the bank to pay him total compensation  of Rs.1,98,000/- including the insurance sum.

4.       Appellant bank appeared before the Forum and resisted the claim. It was contended that since consumer complaint No.84/06 regarding same claim as filed by present complainant was already decided vide order dated 31.5.2007 the complainant had no locus-standi to claim any relief against the appellant bank. It was further contended that appellant bank had received the cheque No.484212 for Rs.1835/- of Standard Charter Bank of India, branch Mumbai along with cheque No.454628 of Rs.6318/- dated 12.1.2006 when there was balance of only Rs.2725.50 at the said account of complainant.  It was further contended that as per condition No.14 given on the last page of pass book every saving bank account holder was supposed to keep at least balance amount of Rs.1000/- in his account. Therefore  considering this condition and the balance of Rs.2725.50 in the account of complainant, the said cheque of Rs.1835/- was dishonoured and accordingly the same was informed to the Insurance Company and therefore  there was no deficiency in service on the part of bank.  It was therefore  requested to dismiss the complaint against the appellant bank.

5.       Respondent No.2 herein i.e. Insurance Company had also appeared before the Forum and filed it`s written version, by which it had denied the claim of complainant.  Insurance Company also contended that since earlier complaint of the complainant had already been dismissed, no fresh complaint regarding the same claim could be entertained and hence the same be dismissed. It was also contended that as cheque of Rs.1835/- in respect of premium was dishonoured there was no contract in between complainant and the Insurance Company.  That, the complainant was already informed regarding cancellation of said insurance cover note and policy, therefore he was not entitled to any benefit under the said insurance policy.

6.       The Forum below on the basis of evidence on record and after hearing the parties allowed the complaint and directed appellant bank to pay him Rs.1 lakh along with interest @12% from 6.1.2006 till the realisation of the entire amount within four weeks. In addition, it was also directed to pay him compensation  of Rs.3000/- towards financial loss along with interest @ 9% from 28.8.2006 within a period of four weeks.  Insurance Company was also directed to pay to the complainant Rs.5000/- towards mental harassment.

7.       Aggrieved by the said judgment and order the present appeal came to be filed in this Commission which was finally heard on 3.1.2013. Adv.Shri.A.T.Ghute was present for appellant, Adv.Shri.S.N.Lavekar was present for respondent No.1, i.e. original complainant whereas Adv.Smt.A.R.Sonawane holding for Adv.A.G.Kanade was present for respondent No.2. Advocate of appellant produced copies of statement of account of Charter Bank of India,  Mumbai along with annexure and copy of RTO particular of the trolly. We heard counsels of respective parties at length finally at the stage of admission of appeal and the appeal was reserved for judgment.

8.       Learned counsel  Shri.A.T.Ghute for the appellant submitted that cheque of Rs.1835/- bearing No.484212 regarding insurance premium was received on 23.1.2006 when there was balance of only Rs.1153.50 in the said saving account of the complainant.  He further contended that the cheque No.454614 amounting to Rs.1628/- issued in favour of ICICI Bank was local cheque and therefore the same was encashed on 19.1.2006. Hence there was only balance of Rs.1153.50.  He therefore  contended that due to short of funds the said cheque of Rs.1835/- could not be encashed and was dishonoured.  Accordingly, the said fact was informed to the Insurance Company vide letter dated 13.2.2006 by the appellant bank. He therefore  contended that there was no deficiency in service on the part of appellant bank. However the District Forum has wrongly observed that there was balance of Rs.4353.50 at the relevant date and thus wrongly concluded that inspite of sufficient funds the appellant bank had dishonoured the cheque. He therefore  contended that judgment and order passed by District Forum is based on wrong observations and therefore  being no deficiency in service on the part of appellant bank, it be discharged from the liability of the payment of compensation  as awarded by District Forum.

9.       On the other hand, learned counsel  Shri.S.N.Lavekar for the complainant submitted that on 6.1.2006 the cheque was presented to the appellant bank at Sengaon branch when there was sufficient balance in the  account of the complainant.  However the appellant bank encahsed the cheque bearing No.454614 dated 7.1.2006 for Rs.1628/- and kept back the old dated cheque i.e. cheque bearing No.484212 dated 31.12.2005 for the amount of RS.1835/-. He thus contended that by dishonouring the cheque of Rs.1835/- which was given for the insurance premium, the bank has committed deficiency in service thereby deprived the complainant from getting insurance benefit. He therefore  fully supported the judgment and order passed by the District Forum.

10.     We have carefully gone through the material before us and also considered in depth the oral arguments as advanced by learned counsels  of respective parties. There are mainly two questions which arise for our consideration and decision. One is, whether it is proved that the appellant bank has committed deficiency in service by dishonouring the cheque pertaining to the insurance premium and secondly whether respondent No.1 i.e. complainant is entitled to receive the amount of compensation  as awarded by District Forum.

11.     As regards the first question, defence as taken by the appellant bank before the Forum is that the cheque of Rs.1835/- bearing No.484212 dated 31.12.2005 pertaining to the insurance amount was received in the bank, when there was a balance of Rs.2725.50 ps in the said saving account of complainant.  It was the contention of bank that as per condition of the saving bank account there should be balance of Rs.1000/- all the time and therefore  the cheque of Rs.1835/- if would have honoured the balance amount at the account would have been less than Rs.1000/-. Hence the said cheque was dishonoured due to short of funds and therefore  there was no deficiency in service on it`s part. We have observed that appellant bank has nowhere given exact date on which it had received the said cheque of Rs.1835/- in it`s written statement and also in affidavit. It has only mentioned that when the said cheque was received there was balance of Rs.2725.50. 

12.     From the perusal of the extract of pass book of the said account of the complainant it is observed that the balance of Rs.2725.50 is on 27.1.2006.  It is further observed that on the same date complainant had deposited Rs.3200/- and balance in  his account became  Rs.4353.50. However on that date the bank cleared another cheque bearing No.454614 dated 7.1.2006 for the amount of Rs.1628/- and therefore  balance came down to Rs.2725.50.  In fact cheque of Rs.1835/- is dated 31.12.2005 whereas cheque pertaining to the amount of Rs.1628/- bearing No.454614 bears the date as 7.1.2006.  In fact learned counsel  for the appellant in his oral argument submitted that cheque of Rs.1835/- was received on 23.1.2006 in the appellant bank and same was dishonoured and returned to the Insurance Company on 13.2.2006.  It means said cheque was with the bank for the period from 23.1.2006 to 13.2.2006.  Therefore  on 27.1.2006 when there was balance of Rs.4353.50 in the  account of complainant it was necessary for the bank to clear the said cheque. However it is observed that cheque of Rs.1628/- bearing  No.454614 dated 7.1.2006 i.e. which was of the  later date was encashed first on 27.1.2006 instead of clearing cheque for the amount of Rs.1835/- which is submitted on earlier date i.e. 31.12.2005.

13.     Even if we presume that the balance in the account of complainant at the time of receipt of said cheque of Rs.1835/- was only Rs.2725.50 it could have cleared the same and could have recouped the balance of Rs.1000/- at later date. In fact perusal of said extract of the account reveals that the balance on 25.7.2006 and onwards, is less than Rs.1000/-.  The point is when there was a condition of keeping balance of Rs.1000/- how the appellant bank had cleared the other cheques causing the amount of balance below Rs.1000/-.   It is thus very much clear that by dishonouring cheque of Rs.1835/- pertaining to the insurance premium, the appellant bank has committed deficiency in service as rightly held by District Forum.

14.     Now, as regards the second question of entitlement amount of compensation,  we have observed from judgment and order dated 31.5.2007 passed by District Forum in C.C.No.84/06 that the complainant was informed by the Insurance Company regarding dishonour of the cheque of Rs.1835/- and regarding cancellation of policy in the month of March 2006.  It is further to be noted that complainant after issuing cheque of Rs.1835/- towards insurance premium the Insurance Company had issued cover note to the complainant.  In that cover note it is made clear at the end of the cover note that “If the policy is not received within 30 days of issue of this cover note, please contact Branch/Divisional Office”. However complainant appears to have not taken any steps regarding said dishonour of the cheque and cancellation of the policy from the month of March 2006 to 24^th August 2006 when his tractor and trolly was stolen. There is also no record to show that he had contacted Insurance Company for getting insurance policy within prescribed period of 30 days. If he had taken proper steps regarding dishonour of the said  cheque and also obtaining insurance policy, there could have been no difficulty in his entitlement to receive the benefit of the said insurance policy. 

15.     We therefore hold the view that for cancellation of the insurance policy the complainant is also equally responsible. In such a situation the complainant cannot be said as entitled to receive the entire benefit of the insurance policy. Hence, we find that the District Forum has failed to appreciate the lapses on the part of the complainant.  In this circumstances therefore we are of the considered view to grant only the lump-sum compensation of Rs.50,000/- to the complainant without any interest. We have therefore to modify the judgment and order passed by District Forum. In the result, we pass the following order.

                                                O   R    D    E    R

1.     Appeal is partly allowed.

2.     The impugned judgment and order passed by District Forum is modified and substituted as under.

“Appellant bank is directed to pay to the complainant a compensation  of Rs.50,000/- towards loss of insurance benefit within a period of 30 days from the date of receipt of this order. Failing which, it shall pay interest on the said amount @6% p.a.till realisation of the entire amount”.

3.     The direction of the District Forum to the Insurance Company to pay Rs.3000/- towards delay in communicating the cancellation of policy by letter dated 25.9.2006 with interest @ 9% p.a.from 28.8.2006 till realisation of the entire  amount within a period of four weeks is kept intact.

4.     No order as to cost of this appeal.

5.     Copies of the judgment be issued to both the parties.

Pronounced on 24/01/2013.