IN THE HIGH COURT OF JUDICATURE AT PATNA Cr.Misc. No.46385 of 2007 1. ORIENTAL INSURANCE COMPANY LTD., ORIENTAL HOUSE A 25/27 ASIF ALI ROAD, P.S. ASIF ALI ROAD, NEW DELHI. 2. THE MANAGING DIRECTOR, ORIENTAL INSURANCE COMPANY, ORIENTAL HOUSE A 25/27 ASIF ALI ROAD, P.S. ASIF ALI ROAD, NEW DELHI. 3. REGIONAL MANAGER, THE ORIENTAL INSURANCE COMPANY, REGIONAL OFFICE PIR MOHANI, P.S. KADAM KUAN, PATNA. 4. THE DIVISIONAL MANAGER, THE ORIENTAL INSURANCE COMPANY, RAI BAHADUR SHIV SHANKAR SAHAY ROAD, P.S. BHAGALPUR, BHAGALPUR. ……………………………………………………………….PETITIONERS. Versus 1. STATE OF BIHAR. 2. SHANKAR PRASAD SAH, SON OF LATE CHHEDI SAH, PROP OF SHANKAR GAS SERVICE , LAL KOTHI, TATARPUR, DISTRICT- BHAGALPUR-(COMPLAINANT)-OPPOSITE PARTIES. ----------- For the Petitioners : Mr. Ashok Priyadarshi, Advocate. For the State : Mr. Jharkhandi Upadhyay, A.P.P. For O.P. No.2 : Mr. Suresh Chandra Giri. ------------ O R D E R The petitioner nos.2 to 4 who are the officers of the Oriental Insurance Company Limited and petitioner no.1 who is the Insurance Company itself and who have been made to figure as accused in Complaint Case No.1467 of 2005 , have prayed for the quashing of the order dated 15.1.2007 passed therein by Sri Manoj Kumar, the learned Judicial Magistrate, First Class, Bhagalpur, whereby he has taken cognizance of offences punishable under Sections 406, 420, 323, 379, 504 and 120-B I.P.C. According to the complainant, one Shankar Prasad Sah, impleaded as O.P. No.2 herein, he happens to be the proprietor of a - 2 - firm running in the name and design of “Shankar Gas Service Agency” and is the distributor of Indane Gas Kolkata and in view of business policy of the complainant’s firm all sections of the business were to be insured and in that view of the matter the firm was insured with Oriental Insurance Company on 17.5.2005 by paying a total premium of Rs.6905/- and in the insurance policy itself all such sections, as detailed, were assigned one of which was a cash transaction of Rs.10,00,000/- and the period of insurance covered was from 17.5.2000 to 16.5.2001. It was alleged that on 24.7.2000 Rs.2,30,000/- was snatched by miscreants from the staff of the insured firm who was going to deposit the said amount collected towards sale proceeds of the day in the Bank and in pursuance thereof claim in the light of the insurance policy was made with the Insurance Company and its Divisional Manager at Bhagalpur but the said Divisional Manager on 1.8.2003 refused to pay on the ground that the amounts covered for loss in transit was limited to Rs.10,000/- only and not Rs.10,00,000/-. It is further alleged that when the complainant protested, the said Divisional Manager is said to have abused the complainant in filthy language and directed his staff to throw out the complainant from the office which on being done was a cause for insult to the complainant. Assailing the impugned order, it has been submitted on behalf of the petitioners that no offence has been committed by them as they had acted in accordance with the norms of the Insurance Company. In this connection, it was submitted that O.P. No.2 in 1998 - 3 - had given a proposal to petitioner no.1 for insuring his gas agency and took policy for cash in transit for Rs.5000/- with other insurance items. This policy was renewed in the year 1999 on the same terms and conditions. Then in the year 2000 the policy was again renewed on the same terms and conditions with slight modification in other items and there was no modification in respect of cash in transit. It is further submitted that when the policy was renewed in the year 2000 a printing mistake occurred and the cash in transit was shown as Rs.10,00,000/- in place of Rs.5000/- although the premium taken was only to cover Rs.5000/-. On detecting the printing mistake in the policy, opposite party no.2 was informed and process for correction was initiated and on 16.5.2000 opposite party no.2 wrote to the petitioner company requesting for the correct policy and claim form and in pursuance thereof on 22.9.2000 the correct policy was issued to the opposite party no.2. The further submission on behalf of the petitioners is that since the claim was in excess of Rs.20,000/- in view of Section 64(U) (M) of the Insurance Act, the claim was investigated and surveyed by the independent Licensed Surveyor who found that the loss of Rs.2,30,700/- was beyond the amount covered by the insurance policy which was Rs.5000/- only. It is also submitted that the opposite party no.2 had accepted the rectification/modification made in the policy without any protest as it was within his knowledge and on 3.12.2001 he submitted a copy of the chargesheet and other documents for settlement of the claim with a request for early settlement and on receiving the aforesaid documents the claim of the - 4 - complainant was settled. Notwithstanding the settlement of claim, it has been submitted that, the complainant filed the complaint case and on 12.9.2006 the petitioner was granted anticipatory bail by the High Court. The specific stand taken by the petitioners is that the complaint is based on imaginary allegations and was a modus operandi to pressurize the officials of the Insurance Company to pay the amount claimed by him. It was further submitted that the court below had failed to appreciate the fact that the premium paid was for covering an amount of Rs.5000/- in transit and the complaint could not take advantage of the printing mistake and no complaint case lay for rejection of insurance claim on valid grounds after an inquiry by an authorized Licensed Private Surveyor . It was also submitted that there had been no criminal intention of the petitioners to put the complainant at a loss and that they had acted in accordance with the provisions of the Insurance Act laid down by the Insurance Regulatory Authority. It was also submitted that the complaint having been lodged after the rectification of the typing mistake in the policy and acceptance of the same by the complainant, the learned cognizance taking court had failed to appreciate this aspect of the matter and the ingredients for the offences whereunder cognizance has been taken had not been made out from the averments in the complaint petition. Although O.P. No.2 has put in an appearance but no show cause or counter affidavit has been filed on his behalf and only oral - 5 - submissions have been made in support of the impugned order. Section 31 of the General Insurance Business (Nationalization) Act (hereinafter referred to as “the Nationalization Act”) provides that every officers or other employees of the Corporation or of any acquiring company shall be deemed to be a public servant for the purposes of Chapter-IX of the Indian Penal Code and Section 38 thereof provides protection of action taken in good faith whereunder no suit, prosecution or other legal proceeding shall lie against any of the officers of the Central Government or officer or other employee of the Corporation or of the acquiring company for anything which is in good faith done or intended to be done under this Act. The Oriental Insurance Company was created under the aforesaid Nationalization Act. Section 31 of the Nationalization Act came for consideration in the case of Gaur Sarkar Vs. The State of Bihar, reported in (2001)3 PLJR 475 and it was held by a Bench of this Court that after the nationalization of the Insurance Companies under the policy decision as contemplated by the Nationalization Act, its every officer/employee is a public servant for the purpose of Chapter IX I.P.C. and officers having responsible posts as per Insurance Act and the Nationalization Act are construed to be public servants and when any action has been taken in discharge of their official duties then for any offence being committed as alleged sanction is required under Section 197 Cr.P.C. In the instant case, no sanction appears to have been taken - 6 - prior to the lodging of the complaint or prior to the taking of cognizance. Therefore, the cognizance taken in the instant case without there being any sanction appears to be in contravention of Section 197 Cr.P.C. and cannot be sustained in law. That apart, even if the allegations made in the complaint petition are accepted then under the insurance policy taken out by the complainant was only required to pay the amount under the policy and accordingly, the complainant had been paid his dues/claim as was permissible under the insurance policy. In that view of the matter, no offence appears to have been committed by the petitioners. Regard being had to the discussions made in the foregoing paragraphs, I find this to be an appropriate case where the powers under Section 482 Cr.P.C. is required to be exercised for curbing an abuse of the process of the court which appears to have been done in the instant case. Accordingly, the impugned order is hereby quashed and the application is allowed. (Abhijit Sinha,J) Patna High Court, Patna. Dated: The 1st day of July, 2009. Pradeep Srivastava/A.F.R.