IMPORTANT POINTS
(1) No casting responsibility on the Bank to pay the insurance premium.
(2) Evident and apparent that the Petitioner firm was not under insurance cover on 09.7.2004, not entitled to get insurance amount.

ORDER

Dinesh Singh, Presiding Member.—This Revision Petition has been filed under Section 21(b) of The Consumer Protection Act, 1986 (‘Act 1986’) in challenge to the Order dated 14.02.2011 of The State Consumer Disputes Redressal Commission, Bihar (‘State Commission’) in F.A. No. 131 of 2009 arising out of the Order dated 26.03.2009 in C.C. No. 01 of 2005 passed by The District Consumer Disputes Redressal Commission, Sitamarhi (‘District Commission’).

2. Heard learned Counsel for the Revisionist Complainant Firm, learned Counsel for the Respondents No. 1 to No. 4 Bank and learned Counsel for the Respondent No. 5 Insurance Co.

Perused the material on record, including inter alia the Order dated 26.03.2009 of the District Commission, the impugned Order dated 14.02.2011 of the State Commission and the Petition.

3. The dispute relates to repudiation of an insurance claim.

4. The factual matrix of the matter has been succinctly captured by the State Commission in paras 3 and 4 of its Order of 14.02.2011:

“3. The complaint was filed by the complainant alleging therein that he had mortgaged his property for obtaining loan from Canara Bank, Sitamarhi Branch, which was sanctioned in two installments. There was grant of loan of Rs. 5,94,000/- and odd, out of which Rs. 2,24,000/- was for availing cash credit facility. The appellant started running his stone crushing business. The loan was sanctioned in the year 2002 and proper insurance after deducting the amount was made by the Bank which were deducted Rs. 5687 and Rs. 10,323/- by way of insurance premium on 14-03-2002 and 07.03.2002 respectively but in the year 2004, no such deduction was made towards insurance premium payment with the result that when there was devastating flood in the entire area on 09-07-2004, the material kept inside the business premises was washed away causing loss to the appellant and got the damaged crusher machine repaired after spending Rs.40,000/- on 19-08-2004.

“4. The claim was made of huge amount. Canara Bank appeared and repudiated the claim, who are respondents here and raised the issue that as a matter of fact, there was no agreement in casting responsibility on the Bank to pay the insurance premium and to have remained particular in such payment so as to safeguard the interest of loanee. Of course, the Bank did pay the aforesaid premium but thereafter the loanee ceased to comply necessary direction for such business operation and financial transaction by submitting necessary statement of stock and the appellant had withdrawn entire amount from the term loan account and working capital account, so it was not possible for the Bank to get the unit insured. It was further submitted that a heavy amount stood due to be realized from the loanee.”

5. The District Commission vide its Order dated 26.03.2009 dismissed the Complaint.

For ready appreciation, extracts of the appraisal made by the District Commission are reproduced below:

“6. From the pleadings of the parties, it is apparent that M/s Jagdamba Enterprises of Fakira Prasad had not been insured on the day 09.7.2004 when the alleged flood had entered into the premises of M/s Jagdamba Enterprises.

“7. From para 13 of the complaint of the Complainant, it is found that the complainant has prayed to pass order the O.Ps. to make payment of the insurance amount. Then there is no insurance of M/s Jagdamba Enterprises with the O.P. no. 5, no order to make payment of insurance amount can be passed in this case.

“8. For the insurance of M/s Jagdamba Enterprises, the proprietor has to apply not the loaner. From the pleadings of the complainant, it does not appear that he had applied for the insurance of M/s Jagdamba Enterprises for the period in which the date 09.7.2004 falls. On the request of the complainant, the amount of premium of the insurance can be deducted from the working capital allowed to the compliant by the bank.

“9. From the facts of the case, it also appears that the complainant had not