DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION, PALAKKAD

Dated this the 6^th day of May,  2022

Present    :  Sri.Vinay Menon V.,  President

                :  Smt.Vidya A., Member                                                  

     :  Sri.Krishnankutty N.K., Member                                          Date of Filing: 26/04/2019 

     CC/120/2019

Kaladharan

S/o late Chami,

Moothanchettykulambu,

Thattamangalam, Palakkad – 678102.                                   -          Complainant

 (By Adv. S.Vinod)                                                                   

                                                                                      Vs

1.         Thattamangalam Service Co-operative Bank Ltd,

            Thattamangalam, Chittur, Palakkad - 678102

            Represented by its Secretary.

2.         Secretary,

            Thattamangalam Service Co-operative Bank Ltd,

            Thattamangalam, Chittur, Palakkad – 678102.

3.         President,

            Thattamangalam Service Co-operative Bank Ltd,

            Thattamangalam, Chittur, Palakkad – 678102.         -           Opposite parties

(By M/s T.K. Ajithkumar & Unni Thomas, Advocates)           

O R D E R 

By Sri. Vinay Menon V., President

1.         Per complaint,  complainant (Membership No.– A7416) of the 1^st opposite party Bank) is a beneficiary of Kissan Credit Card Scheme and conducted  agricultural operations  using the said   loan, availed from the 1^st opposite party. During October 2016, along with the loan, he had remitted insurance premium at the bank for availing insurance cover under Weather Based Crop Insurance Scheme.  Adverse weather conditions caused losses to the complainant  and the complainant is entitled to  Rs.6,836/-  under the Insurance Scheme. But it has come to light that  due to the negligence and deficiency in service on the part of the opposite parties, they failed to promptly remit  the premium amount to the insurance company. The complainant alleges that the 1^st opposite party is liable to make good the losses suffered by the complainant and that the complainant is entitled to compensation as well. Seeking such reliefs, this complaint is filed.

2.         The opposite party, upon entering appearance,  filed version admitting complaint grievance, but qualifying that they had already handed over   the lumpsum premium collected from various beneficiaries of Insurance Scheme as that of the complainant to the District Co-operative bank, and that  it was due to the negligence on the part of the DCB that the premium was not handed over to the Insurance Partner, United India Insurance Co. Ltd. They further challenged the proceedings on the ground of non-joinder of necessary parties like DCB and Insurance Company, availability of alternative statutory remedy under Co-operative Societies Act, 1969 barring the jurisdiction of this Commission and mis-joinder of unnecessary party, ie. the 3^rd Opposite party. They sought for dismissal of complaint as there was no deficiency in service on their part.

3.         Considering the pleadings, the following issues  arise for consideration:

1.         Whether the complaint is maintainable before this Commission in view of S. 69 of the Co-operative Societies Act, 1969?

2.         Whether the complaint is bad for non-joinder of necessary parties?

3.         Whether there is consumer – service provider relationship between the complainant and the opposite parties?

4.         Whether there was a duty imposed upon the 1^st opposite party to get the insurance issued in favour of the complainant?

5.         Whether there is any deficiency in service on the party of the opposite party?

6.         Whether the complainant is entitled to reliefs as sought for?

7.         Compensation and cost?

4.         Evidence on the part of the complainant and opposite party comprised of proof affidavits of the parties.  A couple of documents produced by the opposite party alongwith the proof affidavit were not marked since it had no relevancy or bearing upon the decision making process that was cast upon this Commission. Complainant produced no supporting documentary evidence to prove their claim of entitlements.  Hence, we are left with no alternatives other than to adjudicate the lis based on the admissions made by the opposite parties in their version. 

            Issue no. 1 

5.         One of the main contentions of the opposite parties was that the complaint was not maintainable before this Commission in view of S. 69 of the Co-operative Societies Act,1969. S.69 of the CSA deals with disputes involving Co-operative Societies on one part, whether it be between Societies or individuals on the other part.  The authority of State to legislate on matters dealing with Co-operative Societies is undisputed, in view of the entry 32 of the State List of the Constitution of India.

6.         Counsel for the opposite party relied on the various decisions rendered by the Hon’ble Supreme Court of India and Hon’ble High Court of Kerala and reported as Mardia Chemicals V/s Union of India (2004 (2) KLT 273 (SC)), Punjab National Bank V/s Consumer Disputes  Redressal Forum, Alappuzha and Ors. (2011 (3)KHC 511), Sri.Anandhakumar Mills Ltd., V/s Indian Overseas Bank & Ors. (2018 (2) KHC 883),  and Jagadeesh Singh V/s. Heera Lal & Ors. (2013 KHC 4865). All the aforesaid judgments deals with the exclusion of other Fora where a Bank or Financial Institutions has taken resort to SARFAESI Act. The counsel for opposite party tried to draw parallels between the raison d’etre in these decisions and the facts and circumstances of this case.  We beg to differ with the arguments of the counsel for opposite parties.

7.         Consumer Protection Act is a Central statute enacted in 1986 (Act under which the complaint was filed). What is to be considered is whether there is repugnancy between the in Consumer Protection Act, 1986 and Co-operative Societies Act, 1969. Consumer Protection Act,  in no way,  derails any of the provision of the                    Co-operative Societies Act. Consumer Protection Act does not impose any of its provision on the subject matter of Cooperative Societies Act. Consumer Protection Act solely deals with civil liability of a service provider, in the  event there is a deficiency in service or unfair trade practice. Consumer Protection Act is concerned only with a consumer-service provider relationship and the existence of deficiency in service or unfair trade practice. The reliefs provided by the Consumer Protection  Act, does not take away any remedial measures provided by the Cooperative Societies Act, but are only in addition to what Co-operative Societies Act provides. That being so, there is no repugnancy between the two statutes and both the statutes can comfortably and amicably occupy and adjudicate their respective  subject matters in  this dispute without leading to any repugnancy whatsoever. 

                        Hence existence of S.69 of the Cooperative Societies Act will not oust the jurisdiction and authority of this Commission to adjudicate if there is deficiency in service or unfair trade practice on the part of the opposite party.

Issue No. 2

8.         One of the contentions raised by the opposite parties in the version is that the complaint is bad for non-joinder of necessary parties like the District Co-operative Bank and United India Insurance Company Ltd. If the complainant, the dominus litis   deems it fit to contest his case as against the opposite party of his choice, it is his prerogative. Passing of an order and tilting of the Commission  will be based on  a judicious appreciation of the facts, circumstances and  evidence  of the given case presented before this Commission  and not based on the presence or absence of any other parties.

9.         Herein, we are faced with the challenge of adjudicating whether the opposite parties are liable and responsible for the farmers losing the benefits of the insurance scheme  and whether there is deficiency in service on the part of opposite parties herein. We are only to consider the opposite parties’ liability and responsibility based on the pleadings and the evidence adduced in this case.        

             Hence, non joinder of DCB & Insurance Company would not vitiate the proceedings in this complaint so as to ascertain or determine  the culpability of the opposite parties herein. 

Issue No. 3 & 4

These issues are to be considered together.

10.       The complainant  is a  farmer who has availed KCC loan  from the opposite party Bank.  Naturally the Bank profits from the disbursement of KCC scheme. As an        add-on facility, it has collected premia from the complainant and a number of various other persons who are likely placed as that of the complainant.  This premia is handed over to the Bank  by complainant, based on the trust the complainant reposes upon the opposite party. When such amounts are handed over for  certain purposes to meet some ends  there exist a fiduciary relationship between the complainant and the opposite party Bank. When there is a fiduciary relationship between two parties, there underlies a duty and obligation upon each party to the transaction to be alert and cautious while executing their respective undertakings lest any default would cause pecuniary damages to the other parties in the transaction. 

In the facts and circumstances of this case as between the complainant and opposite party Bank,  there is a fiduciary relation giving rise to a consumer-service provider   relationship, and the  1^st opposite party was duty bound to see to it that the policy was issued in favour of the complainant.  

            Issue no. 5.

11.       Apropos issues 3 & 4,   there exist a fiduciary relationship between the complainant and the opposite party. What transpired after availing the premium from the complainant and those likely-placed can be chronologically tabulated  from paragraphs 5 to 9 of the written version. 

 12.      It can clearly be seen that the 1^st  cheque for premia was issued on 04.11.2016. What prevented the O.P. Bank from following up the fate of the insurance premia is not stated. After issuance of cheque on 04.11.2016, any solid action was taken only on 16.01.2017, that is,  after 73 days, which is a very long and crucial period and fatal when it comes to time sensitive operations like paddy cultivation. There is no explanation as to what prevented issuance of a second cheque immediately upon coming to know of the loss of cheque is also not stated.  There was no prompt follow up of any sort from the 1^st opposite party in any manner as that a prudent person   would resort to. They were not alert, prompt and diligent in their dealings for and on behalf of the complainant, thereby failing to  protect the genuine, bonafide pecuniary interests of their customers, namely, complainant and those similarly placed. 

                        In view of the discussions in issues 3,4 and 5 we find that there is deficiency in service on the part of the 1^st opposite party.

            Issue no. 6

13.       As already noted, this is a complaint that is being dealt-with solely based on pleadings and admissions of opposite parties. The extent of loss sustained by the complainant is pleaded, but not proved by way of cogent and relevant documentary  evidence or by way of admission by the opposite parties.  That being so, the complaint reliefs cannot be granted.  

            Issue No. 7

14.       Though not entitled to complaint reliefs, the complainant is entitled to compensation and reliefs for deficiency in service on the part of the opposite party Bank  as stated below:

1.         The 1^st opposite party shall return the premium collected from the complainant together with interest at the rate of 10% from the date of payment to the opposite party Bank, till date of repayment.

2.         The 1^st  opposite party  shall pay an amount of Rs. 5000/- (Rupees Five Thousand Only) to the complainant by way of compensation.

3.         The 1^st opposite party  shall pay an amount of Rs. 3000/- (Rupees Three Thousand only) to the complainant by way of cost of the proceedings. 

4.         In so far as this complaint is concerned no liability is cast on opposite parties   2 & 3.

The order shall be complied within a period of 45 days from the date of receipt of a

 copy of this Order. In the event the said amounts are not paid within 45 days, the opposite party shall pay a solatium of Rs.250/- per month or part thereof to the complainant till date of payment.

Pronounced in open court on this the 6^th  day of May,  2022

                                                                                                 Sd/-

                                                                                       Vinay Menon V.

                                                         President

            Sd/-

        Vidya A.

                           Member     

                                 Sd/-

                       Krishnankutty N.K.

                              Member  

APPENDIX

Exhibits marked on the side of the complainant

NIL  

Exhibits marked on the side of the opposite parties

NIL  

Witness examined on the side of the complainant

NIL

Witness examined on the side of the opposite parties

NIL

Cost :  Rs. 3000/- allowed

NB : Parties are directed to take back all extra set of  documents submitted in the proceedings in accordance with Regulation 20(5) of the Consumer Protection (Consumer Commission Procedure) Regulations, 2020 failing which they will be weeded out.