STATE BANK OF INDIA Vs. R. VISHWANATHA PAI

JUDGEMENT

(1.) The present Revision Petition has been filed under Sec. 21(b) of the Consumer Protection Act, 1986 (the 'Act') against the State Consumer Disputes Redressal Commission Kerala ('the State Commission') Order dtd. 15/6/2012 in First Appeal No. 634/2011. In the impugned order dtd. 15/6/2012, the State Commission partly allowed the appeal and upheld the remaining order dtd. 26/2/2011 passed by the District Consumer Disputes Redressal Forum, Kottayam ('District Forum') in CC No. 135/2006.

(2.) For the convenience, the parties are referred to as placed in the original Complaint filed before the District Forum.

(3.) The brief facts of the case are that the complainant, along with his mother, Sulochana Bai, had availed cash credit loan facility for Rs.3,00,000.00 from OP 3 Bank vide an agreement dtd. 4/10/2000. As security, the complainant pledged the stock-in-trade, machinery, and furniture in the shop and mortgaged 27.3 cents of land jointly owned by him and his mother. Subsequently, on 2/7/2003, he availed an additional cash credit facility of Rs.2,00,000.00 by executing another agreement. As per the loan agreement, the stock-in-trade, machinery, and furniture were to be insured, with premiums debited from his account. Initially, the complainant had obtained insurance policies from the New India Insurance Company. However, due to tie-up arrangements between OPs 1 to 3 and OP-4 Insurance Company, the complainant's policies were shifted to OP-4. The complainant was assured that OP-3 would handle policy renewals, including premium payments, which would be debited from his account. He submitted stock statements to OP-3 at fortnightly intervals. On 1/11/2005, at about 11:30 PM, a fire broke out at the complainant's shop, completely destroying the stock and property, resulting in loss of approximately Rs.14,00,000.00. He approached OP-4 for inspection and assessment of the loss. It was then discovered that the insurance policies had lapsed. Upon further inquiry, he learned that the stock and machinery had been insured with OP-4 under two policies: one for Rs.4,00,000.00 which expired on 22/6/2005, and another for Rs.4,00,000.00 which expired on 7/9/2005. The complainant asserted that failure of OPs to renew the policies, constituted negligence and deficiency in service.