Decided on January 22,2009



J.D.KAPOOR,PRESIDENT (ORAL) - (1.)THE complainant company is carrying on the business of Full Fledged Money Changer (FFMC) under Licence No. FFMC.EC.DEL/41/95 granted by the Reserve Bank of India. On expressing interest by the complainant of getting its day -to -day business risk relating to transaction of money changing, the opposite party (in short "O.P") -Insurance Company vide its letter dated 12th November, 2001 offered a comprehensive premium rates and salient features of the policies through which they intended to cover the risks according to the complainant's needs. The complainant vide its letter dated 5th December, 2001categorically requested for inclusion of two features in the policy particularly coverage of risk of forged and dishonoured cheques/pay order / drafts / credit cards and other banking instruments as it was a specific and categorical requirement of the complainant company to get such risks covered in the policy. Accordingly the complainant filled a proposal form issued by the O.P Company and insured itself for the period 9.12.2001 to 8.12.2002 covering a total risk of Rs. 6.00 crores and covering a single transaction up to a limit of Rs. 30.00 lakh. Clause -8 of Schedule to the said insurance policy covered the risks in respect of fraud, forgery with respect to buying selling of foreign currency in exchange of cheques and other banking instruments up to Rs. 30.00 lakh.
(2.)ONE M/s. Vision Computers projected themselves as a very well reputed and financially sound concern and showed interest in purchasing foreign currency, from the complainant company, as they were often required to buy foreign exchange owing to their extensive travelling. The complainant before entering into any business transaction conducted various personal meetings at Directors level, examined its balance sheet, bank statement and scrutinized volumes of their other dealings before extending them the facility of buying foreign exchange from the complainant company against the company cheques issued by the said Vision Computers. Initially the cheques issued by Vision Computers were honoured by the bank during the period 2nd Jan to 12th February, 2002. However, from 13th February, 2002 to 16th February, 2002 within a span of four days M/s. Vision Computers committed fraud worth Rs. 27,17,590 and the cheques were returned by the bank with the remarks "Account Closed".
(3.)THE O.P. -Insurance Company was duly informed vide letter dated 26th March, 2002, about the factum of fraud and forgery committed by M/s. Vision Computers and a police complaint was also lodged in this regard. However, the said complaint was clubbed with other similar complaints against Vision Computers and the case was handed over to EOW and final FIR dated 26th March, 2002 was registered by P.S. Connaught Place. The complainant again vide its letter dated 3rd April, 2002 requested the O.P. -Company to release an amount of Rs. 20.00 lakh on ad hoc basis, however, the O.P. -Company informed vide its letter dated 15th April, 2002 that they had already appointed Atul Kapoor and Co. for assessing the loss.
However, the Surveyor went on asking for different information in a piecemeal manner and also for the same information again and again with the sole intention of delaying the process. On 3rd September, 2002 the complainant also informed the O.P. -Insurance Company that they had been furnishing all the information sought by the Surveyor again and again and in spite of the same similar queries were being raised by the Surveyor. It was also made clear to the Surveyor that the investigating officer appointed by the O.P. -Company Mr. Harish Kumar had inspected the necessary records, books of account, cash register, computer records, etc. of the complainant company and also that the complainant company had complied with all the requirements in terms of various circulars of RBI in respect of various transactions entered into between the complainant and M/s. Vision Computers.

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