1. This appeal has been filed by the appellant against the order dated 29.09.2010 passed by the Gujarat State Consumer Disputes Redressal Commission, Ahmedabad (in short "the State Commission) in Consumer Complaint No. 46 of 2007 - Navsarjan Industrial Coop. Bank Ltd. vs. The New India Assurance Co. Ltd. by which, complaint was allowed.
2. Brief facts of the case are that Complainant/Respondent is a Co-operative bank registered under the Cooperative Societies Act. The opposite party/appellant had insured the complainant by Bankers Indemnity Policy. The complainant had paid Rs. 29,096/- on 22.5.2003 for insurance coverage to the extent of Rs. 40,00,000/- i.e. basic sum insured Rs. 5,00,000/- on premises, Rs. 20,00,000/- and Rs. 15,00,000/- for additional sum insured on transit. The said policy was renewed as stated in para 4 of the complaint for risk covering to the extent of Rs. 50,00,000/- i.e. basic sum insured Rs. 5,00,000/- additional sum insured on premises Rs. 25,00,000/- and additional sum insured on transit Rs. 20,00,000/-. The policy was supplied by the OP, but the terms and conditions of the policy were not supplied. It was also stated that the complainant was previously insured by National Insurance Company Limited and also United India Insurance Company Limited but on assurance of better services and terms and conditions, the complainant bank had transferred all their insurance business to the OP. The complainant bank had entered into contract with M/s. Prasad and Company for security services at the bank and also at bank''s attached property at borrower''s place. The security contractor was duty bound to provide guard when the office/ staff employees go for cash withdrawal as and when required. It was practice of the bank to send two clerks along with the security guard with necessary cheque through private vehicle. The cash used to be put in a trunk while returning. On 13.9.2005, two clerks of bank Shri Ishwarbhai Patel and Shri Pareshbhai Bokaria alongwith guard Shri Revadas Haridas Rohit had gone for withdrawal of Rs. 20,00,000/- from State Bank of India in hired auto rickshaw No. GJ-5-Y-7685 owned by one Babubhai Parkar. The cheque bearing No. 219195 was encashed and amount of Rs. 20,00,000/- withdrawn and put in the trunk. While returning, near Mahavir Cinema, two unknown persons came on bike like vehicle and opened fire through their revolver injuring the guard Shri Revadas. They threatened the employees and robbed the trunk which was locked. Revadas was taken to hospital and FIR was registered with the police. The formal intimation was given to the OP- insurer also. The bank had lodged claim for indemnification of loss under the policy on 17.9.2005. The insurer had appointed M/s. Parimal R. Shah and Co. as surveyors. The bank has supplied all necessary papers even certificate-cum-final report from police authoritywhich was supplied around January, 2006. The claim came to be repudiated on 11.1.2007 on a flimsy ground i.e. breach of condition 5 (b) of the policy. According to the complainant condition 5 (b) of the policy was never brought to their notice and that condition 5 (b) was a unique condition which was not there in the bank indemnification policies. The complainant was not supplied entire contract of insurance and as such condition 5 (b), if any, was not applicable to its claim. Alleging deficiency on the part of OP, complainant filed complaint before State Commission. OP resisted complaint, admitted issuance of cover note on 22.5.2003 and further renewal in 2004 and 2005. Fact of robbery on 13.9.2005 was not disputed and lodging of FIR was also not disputed. It was further submitted that OP appointed surveyor and submitted that on account of breach of terms and conditions of policy, claim was rightly repudiated as complainant breached Condition No. 5 (b) of the policy pertaining to two guards with fire arms with cash. It was further submitted that complainant has not mentioned regarding non-receipt of terms and conditions of policy in its letters dated 17.1.2007 and 20.9.2007. It was further submitted that complainant must have entered into contract after seeing proposal and it does not lie in the mouth of complainant that he was not aware of terms and conditions of policy. It was further denied that OP agreed to issuance of insurance policy on the same conditions on which earlier insurer National Insurance Co. and United India Insurance Co. issued policy. Condition No. 5 (b) was in the contract and same is binding on both the parties and OP has not committed any deficiency in repudiating claim and prayed for dismissal of complaint. Learned State Commission after hearing both the parties, allowed complaint and directed OP to pay Rs. 20 lakhs with 9% p.a. interest from 11.1.2007 till realization and further directed to pay Rs.10,000/- as cost of proceeding against which, this appeal has been filed along with application for condonation of delay.
3. Heard learned Counsel for the parties and perused record.
4. As far delay in filing appeal is concerned, appellant has filed application for condonation of 16 days delay and submitted that copy of impugned order was received on 8.10.2010, which was forwarded to Regional Office on 15.10.2010 and Regional Office sent it to Head Office on 25.10.2010 and Head Office after examining file, entrusted the case to the Counsel on 10.11.2010 and delay occurred due to Diwali vacations and appeal was filed on 23.11.2010. No doubt, there is delay of 16 days in filing appeal, but reasonable explanation has been given for condonation of delay and in such circumstances, delay in filing appeal is condoned.
5. Learned Counsel for the appellant submitted that inspite of breach of Condition No. 5 (b), learned State Commission had committed error in allowing complaint; hence, appeal be allowed and impugned order be set aside. On the other hand, learned Counsel for the respondent submitted that as terms and conditions of the policy were not supplied to the complainant and complainant was not aware about such terms and condition, learned State Commission rightly allowed complaint; hence, appeal be dismissed.
6. It is not disputed that complainant obtained first Bankers'' Indemnity Policy from OP on 22.5.2003 and later on, it was renewed in the year 2004 and in the year 2005 and incident occurred on 13.9.2005 during subsistence of renewed policy from 21.5.2005 to 20.5.2006. it is also not disputed that complainant sent two bank employees with security guards armed with wooden stick in Rickshaw along with necessary cheque for withdrawal of Rs. 20 lakhs from State Bank of India. It is also not disputed that after withdrawal of amount while returning back one of the two accused persons fired bullets from a revolver due to which guard Revadas sustained injury and robbers snatched trunk and run away with trunk containing Rs.20 lakhs cash and after the incident FIR was lodged and intimation was also given to OP. It is also not disputed that OP vide letter dated 11.1.2007 repudiated claim on account of violation of Condition No. 5 (b) which provided that for cash in transit exceeding Rs.10 lakhs two guards with fire arms to escort. It is also not disputed that OP wrote letters dated 17.1.2007 and 20.9.2007 to OP and when claim was not paid complaint was filed.
7. Condition No. 5 (b) of the Bankers'' Indemnity Insurance Policy runs as under: " Conditions Precedent to Liability :
(a) xxx< >
(b)For cash-in-transit exceeding Rs. 5 lacs and upto Rs. 10 lacs one escort with fire arm
shall be provided.For cash-in-transit exceeding Rs. 10 lacs two guards with fire arms shall
escort.Out of which one shall sit along with the driver and other at the rear irrespective of
whether the insured''s own vehicle is used or whether a private vehicle is engaged.?
It is admitted case of the complainant that two guards with fire arms were not sent by complainant
while bringing cash Rs.20 lacs after withdrawal from State Bank of India. Complainant in letter
dated 20.9.2007 disclosed that since beginning the bank has its Security Service Contract with
M/s. P. Prasad & Co., Ankleshwar and normally they used to send a Gunman with two Bank''s
Staff for Cash Withdrawal from State Bank of India, Ankleshwar (Main). The Security Guard
with licensed arm deployed by the Security Contractor M/s. P. Prasad & Co., resigned on
21.8.2005. Ankleshwar being "B? class city, the security armed personnel were not easily
available. No bank can stop its working/banking business/transactions etc. for non-availability of
security armed guard.
Thus, it becomes clear that admittedly, complainant violated Condition No. 5 (b) of the Bankers''
Indemnity Insurance Policy.
8. Now, the core question to be decided is whether inspite of violation of aforesaid condition of
policy, OP can be held liable to indemnify the loss caused to the complainant.
9. Learned Counsel for the complainant submitted that as terms & conditions of policy were not supplied by OP to complainant, these terms and conditions are not binding on the complainant. In support of his contention, he has not placed any document on record to substantiate that terms and conditions of policy were not supplied to him except allegations in the complaint that the OP did not supply copy of terms and conditions of policy and mere schedule of policy was given. OP has denied this fact in its written statement and has specifically pleaded that complainant was well aware about the terms and conditions of insurance policy as it used to send gunmen with two bank employees for cash withdrawal, but as contractor resigned and security armed personnel were not easily available, bank could not have stopped it working for non-availability of armed security guards, they sent bank personnel for withdrawal of amount. OP has placed on record insurance policy along with terms and conditions which contains schedule below paragraph 13 in which details of aforesaid policy, etc., have been given and this has been duly signed by officer of OP which makes it clear that terms and conditions of policy along with insurance policy were supplied by OP to the complainant.
10. When claim was repudiated by letter dated 11.1.2007 by OP, complainant vide letter dated 17.1.2007 requested to re-consider the case in which it was mentioned that why at the time of claim, Condition No. 5 (b) was highlighted and why OP''s policy contains such clause whereas, such clause does not appear in insurance policy issued by National Insurance Co. and United India Insurance Co. It was further submitted that proposal form for 2006-07 submitted to United India Insurance Co. has special note regarding departure of aforesaid condition in unavoidable circumstances. In this letter it has nowhere been mentioned that terms and conditions of policy were not received by complainant along with insurance policy and only it has been submitted that why Condition No. 5 (b) has been highlighted at the time of claim. As far proposal form for 2006-07 submitted to United India Insurance Co. is concerned, it has got no relevance, as this proposal form pertains to subsequent year of the incident and that too with other insurance company which might agree with such terms and conditions. In this letter it has also been submitted that when other insurance companies do not contain such clause, why OP has such unique clause. This cannot be a ground for allowing claim because every insurance company has different terms and conditions of policy and insured is free to take insurance policy from any company which suits to its requirement. Later on, another letter dated 20.9.2007 was written by complainant to OP in which also it has nowhere been mentioned that OP did not supply terms and conditions of policy to the complainant. Only it has been stated that they were not educated about the limitation and coverage and also about such stringent conditions in the policy regarding arm escort. Thus, it becomes clear that allegation of non-receipt of terms and conditions of policy is afterthought that too without any document in support of this allegation and in such circumstances, it cannot be presumed that terms and conditions of Bankers'' Indemnity insurance policy was not supplied by OP to the complainant. It is admitted case of the parties that incident took place at the time of second renewal of insurance policy and in such circumstances, it can very well be presumed that terms and conditions of policy must have been supplied by OP to complainant while obtaining original insurance coverage in the year 2003 and at the time of subsequent renewal in the year 2004 and 2005. Once we come to the conclusion that terms and conditions of policy were supplied by OP to the complainant and they were part and parcel of policy, parties are bound by those terms and conditions of policy as held by Hon''ble Apex Court in No. C.A. No. 6527 of 2002 - Sikka Papers Ltd. Vs. National Insurance Co. Ltd. & Ors.
9. In Vikram Greentech (I) Ltd. & Anr. v. New India Assurance Co. Ltd .,1 we
considered the essentials of insurance of contract thus:
"15. An insurance contract, is a species of commercial transactions and must be
construed like any other contract to its own terms and by itself. In a contract of
insurance, there is requirement of uberimma fides i.e. good faith on the part of the
insured. Except that, in other respects, there is no difference between a contract of
insurance and any other contract. The four essentials of a contract of insurance
are, (i) the definition of the risk , (ii) the duration of the risk, (iii) the premium and
(iv) the amount of insurance. Since upon issuance of insurance policy, the insurer
undertakes to indemnify the loss suffered by the insured on account of risks
covered by the insurance policy, its terms have to be strictly construed to
determine the extent of liability of the insurer. The endeavour of the court must
always be to interpret the words in which the contract is expressed by the parties.
The court while construing the terms of policy is not expected to venture into extra
liberalism that may result in re- writing the contract or substituting the terms
which were not intended by the parties. The insured cannot claim anything more
than what is covered by the insurance policy. [General Assurance Society Ltd. Vs.
Chandumull Jain and another, AIR 1966 SC 1644, Oriental Insurance Co. Ltd. Vs.
Sony Cheriyan (1999) 6 SCC 451 and United India Insurance Co. Ltd. Vs.
Harchand Rai Chandan Lal (2004) 8 SCC 644."
Thus, it becomes clear that terms & conditions of Insurance policy are to be strictly construed to
determine the extent of liability of the insurer and as in the case in hand complainant has violated
Condition No. 5 (b) of the policy in not sending two armed gunmen while transporting cash. OP
has not committed any deficiency in repudiating claim.
11. Learned Counsel for the respondent has placed reliance on (2000) 2 SCC 734 - Modern
Insulators Ltd. vs. Oriental Insurance Co. Ltd. in which it was held that in the absence of
communication of exclusion clause to the insured, insurer cannot claim benefit of that clause. He
also placed reliance on AIR 1987 SC 1184 - Skandia Insurance Co. Ltd. vs. Kokilaben
Chandravandan & ors. in which motor accident claim was allowed inspite of not holding valid
driving licence. Facts of aforesaid case are not applicable to the facts of present case, as present
case involves violation of specific condition for transporting cash from one place to another
place. He also placed reliance on judgment of this Commission in III (2007) CPJ 34 (NC) -
National Insurance Co. Ltd. Vs. D.P. Jain and III (2009) CPJ 246 (NC) - United India Insurance
Co. Ltd. & Anr. Vs. S.M. Tele Communications & Anr. in which it was held that if exclusion
clause is not explained to the insured that is not binding on the insured and is to be ignored. These
cases do not help to the respondent as respondent failed to prove that he was not supplied terms
and conditions of policy. We agree with the proposition of law laid down in above case, but it is
not applicable to the facts of present case as in the case in hand complainant could not prove that
he was not supplied terms and conditions of policy. Complainant in para 7 of the complaint stated
that at the time of entering into contract, OP agreed that condition of policy would be similar that
of National Insurance Company and United India Insurance Co. and this fact has been mentioned
in letter dated 17.1.2007. First, we do not find such averment in letter dated 17.1.2007 that OP
will issue insurance policy on the same terms and conditions on which earlier insurer issued
policy and secondly, this averment makes it clear that terms and conditions of policy were
attached with the policy, though, might not having similar terms and conditions which
complainant had with earlier insurer.
12. Learned Counsel for respondent also placed reliance on judgment of Hon''ble Apex Court in II (1996) CPJ 18 (SC) - B.V. Nagaraju vs. Oriental Insurance Co. Ltd. in which inspite of breach of terms and conditions of policy, claim was allowed on the basis of Skandia Insurance case. Aforesaid case is not applicable to the facts of present case as in aforesaid case more human beings were carried in goods vehicle than permitted and they had not contributed to the accident whereas in the case in hand had there been two armed gunmen robbers might not have succeeded in taking away trunk loaded with Rs. 20 lakhs cash. Learned State Commission has wrongly observed that in such a sudden attack it is very doubtful as to whether it would have made any difference if the guard had fire arm because in such circumstances, robbers would not have dared to snatch trunk loaded with cash.
13. In the light of aforesaid discussion, it becomes clear that complainant violated Condition No. 5 (b) of the terms and conditions of policy and transported cash without two guards with fire arms, OP has not committed any deficiency in repudiating claim and learned State Commission has committed error in allowing complaint and appeal is to be allowed.
14. Consequently, appeal filed by the appellant is allowed and impugned order dated 29.09.2010 passed by the learned State Commission in Consumer Complaint No. 46 of 2007 - Navsarjan Industrial Coop. Bank Ltd. vs. The New India Assurance Co. Ltd. is set aside and complaint stands dismissed, with no order as to costs.
