CHENNAI: The Madras High Court has ordered an insurance company to pay full compensation amount to farmers affected by Gaja cyclone irrespective of the wrong entry made on the web portal concerned.
A division bench of Justices of SS Sundar and AD Maria Clete passed the orders recently allowing an appeal filed by the Kumbakonam Central Cooperative Bank challenging a single judge’s order.
The case pertains to 52 farmers belonging to six villages of Nagapattinam district enrolled with the Thittachery Primary Agricultural Cooperative Credit Society, who suffered crop loss in the 2018 cyclone. Since they had insured their crops with the New India Assurance company under Prime Minister’s Fasal Bhima Yojana for the Rabi season of 2017-18 and paid the premium, they made representations for compensation.
Subsequently, an assessing team held inspections and recorded the quantum of loss which ranged from 51.35% to 91%. However, the assessment team made a wrong entry of 8.23% on the web portal concerned.
The central cooperative bank found the mistake and duly informed the insurance company. However, the latter did not accept the submission, instead, disbursed meagre compensation for only 8.23% of loss.
As a result, all the 52 farmers filed a writ petition in the high court. A single judge, after hearing the case, ordered the bank to pay the remaining amount of compensation and held that the insurance company could not be held responsible to pay, agreeing with the company’s contentions on the relevant clauses of the operational guidelines governing payment of compensation.
Disapproving the contentions of the insurance company, the division bench held that sub-clause 2 of Clause XVII of the operational guidelines cannot be understood to mean that any error in uploading the actual damage caused cannot be rectified as the error is due to inadvertence or a clerical mistake.
“We are unable to appreciate the contentions of the insurance company on the interpretation of the operational guidelines, to wriggle out of its contractual obligations,” the bench said.
The bench set aside the order of the single judge saying that he had not considered the relevant provisions of the operational guidelines in a proper perspective with respect to the admitted facts and the circumstances.
It directed the insurance firm to disburse the exact compensation within six weeks along with 12% interest per annum from the date of filing of the writ petition.