CANARA BANK Vs. NARESH KUMAR JAIN

JUDGEMENT

(1.) This revision petition has been filed by the petitioner, Canara Bank against the order of the State Commission dismissing the appeal filed by the petitioner against the order of the District Forum allowing the complaint filed by the respondent.

(2.) Facts relevant for us to appreciate the case are that the respondent had obtained Cash Credit limit of Rs. 30,000/- and as per the terms of agreement all goods stored in the shop and godown of the complainant stood hypothecated. The shop was getting insured by the petitioner Bank at the cost of the respondent. Bank did take an insurance policy for the period 30.5.1994 to 29.5.1994 in respect of shop at Main Bazar, Una, (HP). Complainant had taken an insurance policy for the shop as well as the godown which is surrendered on 6.7.1994. Loss on account of flood/heavy rains is reported on 7.7.1994. Claim preferred by the respondent Rs. 34,147/- is not accepted by the Insurance Company as the godown where the loss is alleged to have occurred is not covered by any insurance policy. Only shop is covered by the policy and since no loss is reported from the shop, it is a case of no claim. Respondent filed a complaint before the District Forum where the complainant alleging deficiency on the part of both, the Bank and the Insurance Company and praying for relief totalling Rs. 2.80 lakhs under various heads. The District Forum while exonerating the Insurance Company held the Bank liable for not taking policy for goods in the godowns and directed the petitioner Bank to indemnify the complainant by paying Rs. 34,147/- i.e. the claimed amount and Rs. 10,000/- as compensation. Appeal filed before the State Commission was dismissed.

(3.) It was argued by the learned Counsel for the petitioner that primary duty is of that of the complainant to take insurance policy for the hypothecated goods. It is true that the petitioner had been taking such insurance policy but it clearly related to the material/goods in the shop, and the same had been maintained for the year that the Bank had been taking the policy. At no stage was any effort made or objection taken by the respondent for non-inclusion of godown within the place to cover the insured goods. There is no evidence on record as to under what circumstances the respondent cancelled the policy taken by him for both the shop and godown ? Insurance cover is a contract primarily between the respondent and the Insurance Company. For any loss on account of floods, adequate and proper cover had to be taken by the insured. Petitioner Bank had to protect its interest which it did by insuring goods at the shop. It was also argued by him that it is relevant to note that Cash Credit limit was sanctioned in 1990 and recalled on 2.6.1992 and a suit of recovery was filed by the petitioner on 4.5.1993. Where is the question of deficiency on the part of the petitioner ? The orders of both the lower Forums are erroneous on points of fact and law and need to be set aside.