GENERAL INSURANCE CORPORATION OF INDIA vs Nain Singh

-WE have heard learned Counsel for the parties and have also examined the record of this case. Under a scheme floated by Government of India for the purpose of Crop Insurance, respondent No. 1 in both these cases having got their crop insured with the appellant through respondent Nos. 2 and 3 is not in dispute. After charging premium from respondent No. 1 in both the appeals by respondent No. 3-bank, the same was deposited with the appellant, is again admitted by the parties. Rest of the facts have been in detail in the impugned order of the District Forum below in these appeals,. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Whether the Local Papers may be allowed to see the order? as such they are not being repeated.

WHEN hearing in these cases commenced, learned Counsel for the appellant made an attempt to persuade us that appellant is not responsible for the payment of compensation awarded, as according to her, extent of alleged loss suffered by the respondents in these appeals was not got assessed as per the procedure prescribed for the said purpose and unless needful was done by following the requisite procedure, her client could not have been held liable for payment of any amount as ordered by the District Forum below. Thus, she prayed for allowing these appeals by setting aside the impugned orders. Alternatively, and without in any manner giving up her earlier plea, she pointed out that even if it be assumed for the sake of arguments that there is any liability for the payment of compensation on account of the alleged failure of crops of the respondents during the relevant year, in such a situation, the compensation assessed is excessive, and interest allowed is on higher side which needs to be reduced to 6% per annum and punitive damage of Rs. 2,500 in each case together with costs of the appeals be also disallowed. These pleas have been contested by Mr. Verma, learned Counsel for respondent No. 1. As according to him, once insurance is admitted and failure of crops has been established on records, as such no exception can be taken to the impugned order on any of the grounds urged on behalf of the appellant. Thus, he prayed for dismissal of both the appeals with costs while upholding the impugned order.

In our opinion, plea urged on behalf of the appellant that the extent of damage was not got assessed, therefore, her client is not liable for payment of anything, is a plea raised simply to be rejected. Reason being that there is adequate, ample and unrebutted evidence on record which clearly establishes the failure of crops during the relevant period for which it was insured by the appellant and also the fact that the premium had been routed to it (i. e. , the appellant), through respondent No. 3-bank under the scheme floated by the Government of India. As such, this plea is hereby rejected.

NOW coming to the question as to whether on quantum the impugned order calls for interference in these appeals. On the basis of the evidence on record, we are of the view that our answer is in the negative. Therefore, on the quantum also, plea urged by learned Counsel for the appellant is hereby rejected in both the cases. However, it is felt that in the face of the facts of both these appeals, interest allowed on compensation calls for interference by reducing the same from 9% to 7% per annum. This, in our opinion, will very well serve the interest of justice. Besides this, punitive damages allowed also cannot be justified in these cases, which also need to be disallowed. Ordered accordingly.

NO other point was urged. In view of the aforesaid discussion, both these appeals are partly allowed and as a result of it, while upholing the compensation awarded in favour of respondent No. 1 in both these appeals, interest on the same is ordered to be payable at the rate of 7% instead of 9% allowed by the District Forum below from the date of complaint till the date of payment/deposit whichever is earlier, as also punitive damages in the sum of Rs. 2,500 in each complaint, are also diallowed. Subject to this modification, both these appeals stand finally disposed of. All interim orders passed from time-to-time in these appeals are vacated forthwith. Learned Counsel for the parties have undertaken to collect the copy of this order in these appeals from the Reader of the Court personally free of cost. Office is directed to place an authenticated copy of this order on the file of Appeal No. 74/2007. Appeals partly allowed.