M/S. Kalinga Polypacks Pvt. Ltd vs Chief Manager
2025 Latest Caselaw 4585 Ori

Orissa High Court

M/S. Kalinga Polypacks Pvt. Ltd vs Chief Manager on 4 March, 2025

Author: S.K. Panigrahi

Bench: S.K. Panigrahi

                          IN THE HIGH COURT OF ORISSA AT CUTTACK
                                              W.P.(C) No. 13562 of 2022
                       M/s. Kalinga Polypacks Pvt. Ltd.            ........        Petitioner(s)
                                                                        Mr. B.K. Sharma Sr.Adv.
                                                                            along with associates
                                                  -Versus-
                       Chief Manager, Union Bank of India
                       & Ors.                    .......... Opposite Party(s)
                                                     Mr. Bhaskar Chandra Panda, Adv.
                                                                      (for O.Ps.1 & 2)
                                                                 Mr. G.P. Dutta, Adv.
                                                                            (for O.P.3)

                                     CORAM:
                                     DR. JUSTICE S.K. PANIGRAHI
                                                  ORDER

04.03.2025 Order No.

12. 1. This matter is taken up through hybrid arrangement.

2. Heard learned counsel for the parties.

3. The present Writ Petition has been filed by the Petitioner

with the following prayer:

"Under the aforesaid circumstances, it is humbly prayed that your Lordship's may graciously be pleased to issue Rule NISI calling upon the Opp. Parties more particularly Opp. Parties No.l & 2 to show cause as to why the loss sustained by the petitioner because of cyclone dtd.4/5''' of March, 2020 be assessed as requested vide

letter dtd.16.03.2020, dtd.23.04.2020, 26.06.2020, 18.09.2020,

Designation: Personal Assistant 15.10.2020 and 09.11.2020 under Annexure-3 Series and if the Opp. Reason: Authentication Location: OHC Parties fail to show cause or show insufficient cause make the said Date: 05-Mar-2025 18:24:33 Rule NISI absolute;

And further be pleased to issue a writ of mandamus directing Opp. Parties No.l and 2 to depute the Surveyor for the purpose of assessing the loss caused to the factory premises, plant, machinery, raw materials and finish goods of the petitioner as requested vide Annexure-2 & 3 Series;

And pass such other writ/writs, direction/directions, order/orders as the Hon'ble Court may deem, fit and proper."

4. Learned Senior Counsel for the Petitioner submits that the

Petitioner is a private company represented by its Managing

Director and is engaging in the business of manufacturing of

packaged drinking water, pet soda and plastic bottles at

Choudwar Industrial Estate, Cuttack. He further submits that

the Petitioner had availed financial assistance from the Union

Bank of India. In order to secure the loan, the Opposite Party

No.1/Bank on behalf of the Petitioner had effected Insurance

Policy and the Bank was acted as an agent of the Insurance

Company. As per the IRDA (Licensing of Banks and Insurance

Brokers) Regulations, 2013, the Bank conducts itself like an

agent of the Insurance Company.

5. Learned counsel for the Petitioner further contends that the

Petitioner had suffered due to the cyclone occurred on 4 th and

5th March, 2020. The said cyclone caused heavy damaged to

plant, machineries, raw materials and finish goods of the

Petitioner's Company. The Petitioner was regularly paying the

Designation: Personal Assistant Reason: Authentication Location: OHC premium and the Insurance Policy is very much alive on the Date: 05-Mar-2025 18:24:33

date of onset of the said cyclone. After occurrence of the said

damages due to the cyclone, the Petitioner had approached the

Bank along with all the documents relating to the claim.

However, the Bank failed to send the said documents to the

Opposite Party No.3/Insurance Company for the purpose of the

claim made by the present Petitioner.

6. Learned counsel for the Petitioner further refers to the Rule-7

of Insurance Regulatory and Development Authority

(Licensing of Banks as Insurance Brokers) Regulations, 2013.

The said Rule-7 of the Insurance Regulatory and Development

Authority (Licensing of Banks as Insurance Brokers)

Regulations, 2013 is extracted hereunder:

7. Conduct in relation to claim by client.- Every insurance broker shall:-

(a) explain to its clients their obligation to notify claims promptly and to disclose all material facts and advise subsequent developments as soon as possible;

(b) request the client to make true, fair and complete disclosure where it believes that the client has not done so. If further disclosure is not forthcoming it shall consider declining to act further for the client;

(c) give prompt advise to the client of any requirements concerning the claim;

(d) forward any information received from the client regarding a claim or an incident that may give rise to a claim without delay, and in any event within three working days;

(e) advise the client without delay of the insurer's decision or otherwise of a claim; and give all reasonable assistance to the client in pursuing his claim;

Designation: Personal Assistant assignment on a policy contract which has not been serviced through Reason: Authentication Location: OHC him or should not work as a claims consultant for a policy which has not Date: 05-Mar-2025 18:24:33 been serviced through him:"

7. He further referred to a judgment in Canara Bank vs. M/s.

Leatheroid Plastics Pvt. Ltd.1 wherein a similar sentiment has

been expressed and the judgment was in favour of the insurer.

The position of the Petitioner could have been different in the

event the Bank had alerted the Petitioner regarding the status

of his application or the Bank could have sincerely remitted the

documents to the Insurance Company and inquired about its

availability with the Insurance Company. Further, no

particulars have been produced by the Bank regarding any

communication. In such circumstances, there is an

irresponsible behavior on the part of the Bank in not sending

the documents to the Insurance Company.

8. At this juncture, learned counsel for the Opposite Party

No.3/Insurance Company submits that the Insurance Company

has not received any document relating to the claim of the

present Petitioner from the Bank.

9. Learned counsel for the Insurance Company further submits

that pursuant to the direction of this Court vide order dated

18.01.2024, the Insurance Company received some documents

from the Bank on 31.01.2024. However, since the claim is of the

year 2020 and now long time has been elapsed for assessing the

Signed by: LITARAM MURMU loss suffered by the Petitioner due to cyclone, the real time Designation: Personal Assistant Reason: Authentication Location: OHC Date: 05-Mar-2025 18:24:33

(2020) 5 SCC 722

assessment is not at all possible. Hence, the Insurance

Company cannot honor the claim filed by the present

Petitioner.

10. Learned counsel for the Bank submits that the Bank has sent

all the documents as well as the reminders sent by the

Petitioner to the Insurance Company. However, there is no

mentioned in any particular letter to the Insurance Company

stating that the entire documents placed by the Petitioner have

been remitted to the Insurance Company.

11. In such view of the matter and considering the submission

made by the learned counsel for the parties and taking into

account the fact of long lapse of time for assessment of the loss

suffered by the Petitioner, this Court cannot direct the Opposite

Party No.3/Insurance Company to honor the claim made by the

present Petitioner. It is also important to note that the Petitioner

has no fault in the entire process. In the entire episode, there is

a blame game between the Insurance Company and the Bank

which substantially affects the insurance claim of the present

Petitioner without his fault.

12. Accordingly, this Court directs the Opposite Party Nos.1

and 2/Bank to pay Rs.10,00,000/- (Rupees ten lakhs) as

Signed by: LITARAM MURMU compensation to the Petitioner for the lapse on the part of the Designation: Personal Assistant Reason: Authentication Location: OHC Date: 05-Mar-2025 18:24:33

Bank. The said amount shall be paid to the Petitioner within a

period of one month from today.

13. It is further made clear that the actual loss suffered by the

Petitioner cannot be compensated by the above amount. Hence,

this Court is trying to redress the grievance of the Petitioner by

way of awarding a token of compensation to be paid by the

Bank.

14. Accordingly, the Writ Petition is disposed of.

( Dr. S.K. Panigrahi) Judge

Murmu

Designation: Personal Assistant