AI generated imageNEW DELHI: A consumer commission in Puducherry has dismissed an appeal by Syndicate Bank, now merged with Canara Bank, against an order directing it to pay Rs 4.15 lakh over the loss of goods in a 2001 burglary.The commission held that the bank was responsible for ensuring proper insurance of the goods kept as security for the loan and had failed to ensure burglary cover. The order was passed on August 19, 2026.Why did the dispute arise?According to the commission order, Shanthi Traders had been using banking facilities with Syndicate Bank and had obtained an overdraft facility against its stock-in-trade. The credit limit was gradually increased to Rs 25 lakh by 2001, with the stock kept as security.The business had insurance policies for its goods, but the coverage changed over the years. While one policy covered burglary and house-breaking, the policy in force when the goods were stolen covered only fire.On July 12, 2001, burglars broke into the trader’s godown and stole goods worth Rs 4.15 lakh. The incident was reported to the police and the bank. The trader later sought compensation from the bank and the insurance company.The district consumer commission directed payment of Rs 4,15,612.29 with 9 percent interest. The bank challenged the order, saying the trader was a commercial entity and could not approach the consumer commission. It also denied responsibility for the lack of burglary insurance.Why did the commission hold the bank responsible?The bench comprising members Dr.S.Sundaravadivelu and S.Oumasanguery said the trader could approach the consumer commission because the insurance was taken to protect its goods and was not directly linked to making profits. It also said approaching the Banking Ombudsman earlier did not prevent the trader from filing a consumer complaint.“A plain reading of this section is that the commission is an additional remedy and not despairing one taking away the right to approach the commission. Also looking into the question whether consumer fora has jurisdiction to decide a matter which was already decided by ombudsman,” the commission noted.The commission also found that the burglary had actually taken place. It noted that the trader had immediately informed the police and the bank and that the police had investigated the case and filed a final report saying the stolen articles could not be traced.“Co-relating the evidence laid down and the guidelines, we are convinced that the burglary was indeed effectively investigated, and the police has filed its final report saying that the articles were undetectable. The appellant has not brought in any evidence to counter this and they cannot escape their liability by making baseless defences,” it said.The commission found that the bank had handled the insurance arrangements for the goods. It noted that the bank had taken the responsibility of obtaining the policies and had also collected the insurance premiums.“Thus the policy was initially taken for fire, the next policy is for fire, subsequently for burglary and house breaking and then was for fire only. We see the whole process was handled by the appellant and OP.2/R2. No evidence has been let in by the appellant to establish that the complainant/respondent had played any role in initiating the burglary policy for the year 03.02.1999 to 02.02.2000,” the bench further added.The commission also noted that the trader had not been shown any proof that it was informed about the change in insurance coverage. It held that the bank was responsible for the failure to maintain proper burglary insurance.The commission further rejected the bank’s claim that the trader could no longer file the complaint after clearing its dues. It said the burglary had taken place when the trader was still a customer of the bank and the right to make a claim had already arisen.The commission dismissed the bank’s appeal and confirmed the earlier order directing payment of Rs 4,15,612.29 with 9 percent interest. It also found no reason to interfere with the order of the district commission.