KARIMNAGAR CO-OPERATIVE URBAN BANK LTD Vs. NATIONAL INSURANCE COMPANY LTD., THROUGH ITS DIVISIONAL MANAGER

JUDGEMENT

(1.) This is a consumer complaint filed by the Karimnagar Co-operative Urban Bank claiming an amount of Rs.13,93,071/- on the foot of three bankers indemnity policies bearing Nos. 7700002, 7700001, and 7700062.

(2.) The facts of the case as culled out from the complaint and the other pleadings as also the material filed in support of the respective cases of the parties are briefly as follows:

(3.) The complainant claimed to have taken three policies as aforesaid to cover the risk of theft, misappropriation etc., According to them the said policies were in vogue from 01-4-1995 to 31-3-1996. (But unfortunately the insurance policy exhibited by the complainant as Ex.A2, reveals at page 6 of Ex.A2 that the policy number was 551300/7700001/98-99 valid from 01-4-1998 to 31-3-1999. This is the only policy filed by the complainant to substantiate its case. On the other hand, it is the opposite party which filed, that too after the case is remanded by the National Commission, three policies marked as Exs.B2, B4 and B5 valid respectively from 01-1-1993 to 31-3-1994, from 05-4-1994 to 4-4-1995, and from 1-4-1995 to 31-3-1996 bearing Nos. 1300/7700159/93; 551300/7700002/94-95 and 551300/7700001/95-96 among which we do not find the policy No.7700062. It is the case of the complainant that in the year 1996, it came to the knowledge of the Chief Executive Officer of the complainant that six of its employees by names, 1) G.T.Venkata Reddy (Accountant) 2. R.Venkataswamy (Accountant), 3. Ch.Madhusudhan Rao, (Asst. Accountant), 4. G.Laxminarayana (Asst. Accountant) 5.P.Ravindraraju (Clerk) and 6. V.Srinivas Reddy (clerk) misappropriated the funds of the complainant during the tenure of B.Hanumanulu D.R/Chief Executive Officer of the complainant. As against the said misappropriation a complaint was lodged in I town Police Station Jagtial and the police registered two cases bearing Crime Nos. 42 and 44 respectively. The Divisional Co-operative Officer, Karimnagar lodged a complaint also against S.Hanumanulu and a criminal case was registered against him as well. The complainant suspended the above six employees in the month of January, 1996. In view of these tumultuous developments the complainant could not inform about the misappropriation to the opposite party immediately. Finally the amount lost in the misappropriation was quantified at Rs.13,93,671/- and the said loss was informed to the opposite party demanding from it the insurance amount to that extent. The District C-operative officer had also issued a letter to the opposite party confirming the misappropriation of the amount belonging to the complainant by its employees and requested the opposite party to arrange early payment of the said amount. The said letter was dated 1-7-1997. Thereupon the opposite party had sent a letter dated 4-7-1997 to the complainant seeking certain clarifications. The complainant claimed to have furnished all the information and also submitted application for settlement of its claim before the opposite party but thereafter the opposite party did not take any steps and failed to perform the service it promised by way of insurance. The complainant claimed to have issued several reminders but in vain. The claim was never settled by the opposite party though it was bound under law and contracted to do so. Thus it is the case of the complainant that the opposite party was guilty of deficiency in service an on that ground the present claim was laid for various reliefs a) to direct the opposite party to pay Rs.13,93,071/- towards the Insurance Policy bearing No.7700002, 7700001 and 7700062 together with interest @ of 18% quarterly rest as per the Banking procedure and law b) Direct the opposite party to pay a sum of Rs.50,000/- towards compensation to the complainant. c) Award costs of the proceedings. d) Grant such other relief or reliefs as are deemed fit under the circumstances of the case. Opposite party entered appearance and filed a counter resisting the complaint.