HEMIBEN LADHABHAI BHANDERI versus SAURASHTA GRAMIN BANK & ANR

Citation: [2020] 3 S.C.R. 818 · Decided: 03-02-2020 · Supreme Court of India · Bench: D.Y. CHANDRACHUD · Disposal: Appeal(s) allowed

Judgment (excerpt)

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SUPREME COURT REPORTS
[2020] 3 S.C.R.
HEMIBEN LADHABHAI BHANDERI
v.
SAURASHTA GRAMIN BANK & ANR
(Civil Appeal No. 979 of 2020)
FEBRUARY 03, 2020
[DR. DHANANJAYA Y CHANDRACHUD
AND HEMANT GUPTA, JJ.]
Consumer Protection Act, 1986: Deficiency of service –
Spouse of the appellant was account holder with the first respondent
bank – A scheme was launched by an insurance company for the
account holders of the respondent-bank – Under the terms of the
agreement between the insurer and the bank, the account holder
was required to submit a Form to the concerned officer of the bank
in order to avail insurance cover – Bank was to deduct Rs. 100 as
premium from the account holder and forward it to the insurer –
Insurance cover of Rs. 5 lakhs was offered – Appellant’s case was
that on 21 July 2008, her husband obtained an insurance form
from the Bank and submitted it to its Manager – He met with an
accident on 1 August 2008 while travelling on his motorcycle and
succumbed to injuries on 11 August 2008 – Based on a case of
accidental death, the appellant claimed compensation of Rs.5 lakhs
under the insurance claim – The insurer repudiated the claim on
the ground that the premium was not forwarded by the Bank together
with the Form – The Bank took objection that the Form had not
been submitted in time by the deceased and that after submitting it
initially on 28 July 2008, he had taken it back to discuss the matter
with his relatives – District Forum held that the Bank had been
negligent in not forwarding the form submitted by the deceased to
the insurer within time after completion of all the formalities and
there being no insurance cover, the insured was not liable and Bank
was directed to pay appellant Rs. 5 lakhs – State Commission upheld
the order of District Forum – In a revision filed by the Bank, the
NCDRC reiterated the finding that the insurer could not be held
liable in the absence of an insurance cover – However, the Bank
was held guilty of a deficiency of service and was directed to pay
an amount of Rs. 2 lakhs (instead of Rs. 5 lakhs as awarded) – On
[2020] 3 S.C.R. 818
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appeal, held: Evidently, there was a deficiency of service on the
part of the Bank in failing to forward the application form to the
insurer and in deducting the insurance premium on time – Insofar
as the deficiency of service on the part of the Bank is concerned,
there were concurrent findings – There was specific finding of fact
that it was failure of the Bank to deduct the premium and to pay it
over the insurer which resulted in the insurer repudiating the claim
on the ground that no insurance cover existed – No insurance cover
came into existence – There were concurrent findings of fact by the
three fora – There was no reason to take a different view,
particularly, when the Bank did not challenge the judgment of the
NCDRC – There was an evident deficiency of service on its part –
There was no justification for the NCDRC to reduce the award of
compensation against the Bank from Rs. 5 lakhs to Rs. 2 lakhs –
Amount of compensation is enhanced from Rs. 2 lakhs to Rs. 5 lakhs.
Allowing the appeal, the Court
HELD: Insofar as the deficiency of service on the part of
the Bank is concerned, there are concurrent findings. The
NCDRC confirmed that there was a deficiency of service on the
part of the Bank. Before it, the Bank admitted that no receipt
was given by it to anyone depositing the application form. As a
matter of fact, it has also emerged from the record that three
persons including appellant’s husband had submitted forms on
the same day which had Serial Nos 351, 352 and 353. The defence
of the Bank that the deceased had withdrawn the form and that it
was eventually submitted on 9 August 2008, when a fresh Serial
No 358 was allotted has been rejected by the District Forum and
by the SCDRC. The NCDRC has observed that the Bank has
not explained the details of the application form mentioned at
Serial No 352. There is a specific finding of fact that it was the
failure of the Bank to deduct the premium and to pay it over the
insurer which resulted in the insurer repudiating the claim on
the ground that no insurance cover existed. No insurance cover
came into existence. There are concurrent findings of fact by the
three fora. There are no reason to take a different view,
particularly, when the Bank has not challenged the judgment of
the NCDRC. The Bank’s explanations are an eye-wash and a
thinly disguised attempt t

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