Consumer Complaint No. 77 of 2013. Case: State Govt. of Haryana Vs United India Insurance Co. Ltd.. Union Territory State Consumer Disputes Redressal Commission

Case NumberConsumer Complaint No. 77 of 2013
CounselFor Appellant: Mr. Ajay Chaudhary, Senior Deputy Advocate General and For Respondents: Mr. Paul S. Saini, Advocate
JudgesSham Sunder, J. (President), Dev Raj and Padma Pandey, Members
IssueConsumer Protection Act, 1986 - Sections 17, 2(1)(d); Indian Penal Code (IPC) - Section 409
CitationI (2014) CPJ 289 (UT Chd.)
Judgement DateFebruary 20, 2014
CourtUnion Territory State Consumer Disputes Redressal Commission


Dev Raj, Member

  1. Initially, the complaint bearing No. 34 of 2003 was filed on 22.12.2003, by the complainant, before the State Consumer Disputes Redressal Commission Haryana, Panchkula, which was dismissed vide order dated 21.2.2012. Feeling aggrieved, the complainant filed First Appeal No. 264 of 2012, in the National Consumer Disputes Redressal Commission, New Delhi, which remanded the complaint for fresh decision vide order dated 9.4.2013. The Haryana State Commission vide its order dated 3.9.2013 (at Page 9 of the record), returned the said complaint, to the complainant, being not maintainable before it (Haryana State Commission) with a direction to present the same before this Commission, having the requisite territorial jurisdiction within 60 days of the passing of the order.

  2. The instant complaint was, thereafter, filed on 1.11.2013, before this Commission, which was within the requisite period of 60 days from the date of passing of the order by the Haryana State Commission viz. 3.9.2013.

  3. The facts, in brief, are that the complainant had taken the Insurance Policy bearing No. 110201/48/11/3865/95 dated 25.1.1995 from the opposite parties, which covered the risk of cash in transit from the office to various Banks. It was stated that the minimum carry limit was Rs. 35 lacs only. It was further stated that the said Policy further extended to cover for risk of riot, strike and terrorist etc. It was further stated that simultaneously, another Policy bearing No. 110201/46/12/2630/95 dated 25.8.1995 was taken by the complainant, which covered 9 employees with insurance cover of Rs. 25 lacs each with total cover of Rs. 2.25 crores. It was further stated that a sum of Rs. 1,68,750 was paid as premium by the complainant. It was further stated that Sh. Rajbir Singh, Sales Officer (Assistant) of complainant was covered under both the Insurance Policies. It was further stated that Sh. Rajbir Singh was appointed in Lucknow Camp, vide No. EA/93/7181-95 dated 11.5.1993 and he worked as Sales Officer, Lucknow from May, 1993 to 21.12.1995. His duty was to sell the lottery tickets and remit the sale proceeds thereof regularly to the Head Quarters of the complainant at Chandigarh. It was further stated that said Rajbir was supplied the tickets of various Lottery Schemes of Haryana State Lotteries i.e. Jai Durga, Jai Vishnu, Mahabali, Shri Ganesh, Mahalaxmi, Hari Om, Jai Durge (Ek-Minute) and Mahalaxmi Lottery Schemes. It was further stated that the Department had directed the said Rajbir Singh to remit the outstanding amount of sale proceeds of lottery tickets of various lottery schemes of Haryana State from time-to-time.

  4. It was further stated that in the month of November, 1995, it came to the notice of the Department that Sh. Rajbir Singh had misappropriated huge amount to the tune of Rs. 177.70 lacs and a sum of Rs. 132.09 lacs related to the period for which the Insurance Cover was obtained. It was further stated that the Insurance Company even continued the Insurance Cover, for the succeeding cover also but Sh. Rajbir Singh did not finalise the accounts. It was further stated that Sh. Rajbir Singh, in the month of November 1995, gave in writing that he was to recover amount, from some agents and would remit the same in a month or so but he did not remit the same as promised. It was further stated that in December, 1995 and January-February-April 1996, Sh. Rajbir Singh was repeatedly directed to remit the outstanding amount to the Head Office, but he failed to remit the same. It was further stated that there was a short fall of Rs. 177.70 lacs as per final account statements received by the team of Officers of the complainant through Sh. Rajbir Singh and cash shown in the said statement as compared with the actual receipt deposited by the Sales Officer concerned for the period May 1993 to 21.12.1995. It was further stated that Sh. Rajbir Singh was directed vide letter No. DOL/HR/96/11364 dated 27.8.1996 to deposit the shortage as per accounts submitted by him to the tune of Rs. 177.70 lacs within three days but he did not care at all to submit any reply or to deposit the said amount, which amounted to embezzlement of Govt. Revenue by him. It was further stated that Sh. Rajbir Singh also cheated the Department by sending fictitious cash receipt of the above said amount in his final account statement.

  5. It was further stated that as per the fidelity guarantee scheme, the complainant was entitled to claim the insured amount of Rs. 25 Lacs. It was further stated that the claim was lodged with the opposite parties on 8.8.1996 i.e. within the subsistence of the Insurance Policy, which was valid up to 24.8.1996. It was further stated that FIR was lodged by the complainant against Sh. Rajbir Singh, copies whereof along with the copy of the letter vide which action was taken against the erring employee, were duly supplied to the opposite parties vide letter No. DOL/HR/EA/96/15294 dated 20.12.1996. It was further stated that opposite party No. 2, vide letter No. 110201/Ref.MT/CK/97 dated 18.03.1997 informed the complainant that it had forwarded the claim papers to the higher office for processing and requested for some more documents, which were also supplied by the complainant vide letter No. DOL/HR/EA/97/4979 dated 3.4.1997. It was further stated that Sh. Sumant Sud was appointed as Surveyor and Loss Assessor by opposite party No. 2, who vide his letter dated 23.7.1997 requested the complainant to provide certain documents, which were duly supplied vide letter No. DOL/HR/97/11692 dated 1.9.1997. It was further stated that a meeting was also conducted on 2.7.1998 between the representative of opposite party No. 2 and the complainant and the required information/documents were also provided to the Surveyor. It was further stated that opposite party No. 2 vide letter No. SA/SK/MIS/CLAIM/99 dated 8.9.1999 informed the complainant that all the relevant documents were received by the Surveyor and he was in the process of completing the report. It was further stated that it was also assured that the moment, opposite party No. 2, received the Surveyor report, it would process the claim. It was further stated that the claim form complete in all respects was also sent to opposite party No. 2 by the complainant vide letter No. DOL/HR/EA-1/99/11423 dated 11.11.1999.

  6. It was further stated that the complainant made several requests to the opposite parties to pay the insured amount vide memos dated 8.8.1996, 3.10.1996, 20.12.1996, 19.3.1997, 3.4.97, 1.9.97, 23.1.98, 17.6.99, 25.6.99, 11.11.99, 13.3.2000, 16.5.2000, 3.7.2000, 31.8.2000, 5.2.2001, 27.8.2001 and 11.2.2002 (Annexure-F). It was further stated that the opposite parties vide their letter dated 8.9.99 informed that the matter of claim was under consideration but even after about 21/2 years, no response was given by them. It was further stated that on 28.5.2002 and 19.6.2002, the matter was discussed between the complainant and the Branch Manager of the opposite parties, but to no avail. It was further stated that finally, the claim of the complainant was rejected by the opposite parties vide letter dated 8.7.2002 (Page 83) on the ground that the complainant was already in full knowledge of the loss being caused by its own employee, who violated every Rule in the book with impunity. It was further stated that the aforesaid act of the opposite parties, in repudiating the genuine claim of the complainant, on flimsy grounds, amounted not only to deficiency, in rendering service, but also indulgence into unfair trade practice. When the grievance of the complainant, was not redressed, left with no alternative, a complaint under Section 17 of the Consumer Protection Act, 1986 (hereinafter to be called as the Act only), was filed, directing the opposite parties, to process the claim amount of Rs. 25 lacs, along with interest @ 18% per annum from the date of lodging of the claim till realization; and pass any such order, which this Commission deemed fit and proper in the facts and circumstances of the case.

  7. The opposite parties put in appearance on 12.12.2013. In their written version, they took up certain preliminary objections, to the effect that while the Insurance Policy, in question, was issued by the United India Insurance Company Limited, the complaint was instituted against the General Manager and Branch Manager (opposite party Nos. 1 and 2) in their personal and individual capacity for a claim against the Insurance Company; that the complainant was not a consumer under Section 2(1)(d) of the Consumer Protection Act, 1986 (hereinafter for short to be referred as the Act) as the complainant is a commercial organization and carries on business/commercial activity of lottery business for earning profits; that this Commission has no pecuniary jurisdiction to entertain the decide the complaint as the interest @ 18% per annum, if calculated, from 1996 to 2013 on the principal amount of Rs. 25 lacs, came to be Rs. 1,01,50,000, which exceeded the pecuniary limit of the Commission; that complaint was barred by limitation and...

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