National Consumer Disputes Redressal
Life Insurance Corporation Of India vs Dr. Manjunath Reddy on 22 October, 2019
NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION NEW DELHI REVISION PETITION NO. 1345 OF 2019 (Against the Order dated 28/02/2019 in Appeal No. 484/2015 of the State Commission Karnataka) 1. LIFE INSURANCE CORPORATION OF INDIA THROUGH ASSISTANT SECRETARY(LEGAL) CO (LEGAL)CELL, H-39, NEW ASIATIC BUILDING, CONNAUGHT CIRCUS, NEW DELHI-110001 ...........Petitioner(s) Versus 1. DR. MANJUNATH REDDY S/O. LATE G MALAREDDY, R/O. MEDICAL OFFICER, PRIMARY HEALTH CENTER, MARASABIHALLY VILLAGE, CHALLAKERE TALUK, CHITRADURGA DISTRICT-577501 KARNATAKA ...........Respondent(s)
BEFORE: HON'BLE MRS. JUSTICE DEEPA SHARMA,PRESIDING MEMBER HON'BLE MR. C. VISWANATH,MEMBER For the Petitioner : Mr. Kamal Mehta, Advocate For the Respondent :
Dated : 22 Oct 2019 ORDER Justice Deepa Sharma, Presiding Officer
The present Revision Petition, under Section 21(b) of Consumer Protection Act, 1986 (for short "the Act") has been filed against the order dated 28.02.2019 of the Karnataka State Consumer Disputes Redressal Commission, Banglore (for short "the State Commission") in Appeal No.484 of 2015 filed by the Petitioner whereby its Appeal against the order dated 23.04.2015 of the District Consumer Disputes Redressal Forum, Ghitradurga (for short "the District Forum") in Complaint No.56 of 2014 was partly allowed.
2. Brief facts of the case are that the Respondent (hereinafter called as "Complainant"), purchased the policy under the name of Jeevan Anand from the Petitioner on 28.03.2010 and the sum assured was ₹10 Lakhs. The premium was payable half-yearly. The contention of the Complainant was that he had paid 5 premiums of ₹44,763/- each within stipulated period. Due to his cardiac related problem, he could not pay the premium in the month of September 2012. He remained hospitalized from 05.12.2012 to 15.12.2012 and also underwent by-pass surgery and thereafter, he was on complete rest on the advice of the Doctor. After his recovery, he approached the Petitioner for payment of his premium but he was informed in the month of November 2013 that "policy cannot be considered for revival, without giving any valid reasons". His claim was that he was ready to pay the premium which was due and for that also he issued a legal notice which was vaguely replied. He filed Complaint before the District Forum seeking directions to the Petitioner to revive the policy by collecting the due premium or return the sum of ₹2,23,815/- which had been collected by the Petitioner as premiums along with bonus and interest @ 24% p.a. from the date of first premium till realization and also to pay ₹10,000/- towards mental agony and ₹5,000/- towards cost of the proceedings.
3. Petitioner had admitted in their written version that the premiums were paid till March 2012 and the first unpaid premium was in the month of September 2012. It was further contended that the Complainant had applied for revival of his policy on 29.10.2013 and that the revival of the policy is a fresh contract and it could be done only when both the parties agreed. On scrutiny of the medical reports of the Complainant, revival of the policy was declined. Since the premium was not paid within the grace period of 30 days after the default, the policy attended a lapsed status. It was further contended that refund of the premium with interest is not permissible under the rules. As per the policy conditions, for payment of surrender value, premiums under the policies are to be paid for a minimum period of three years and the policy bond issued to the Complainant was under non forfeiture regulations.
4. Parties led their evidences before the District Forum and after hearing the parties, District Forum reached to the following conclusion:
17. ..........complainant had applied for revival of his policy on 29/10/2013 with mandatory requirements. Op have also admits that the complainant i.e. life assured had under gone by pass surgery, Ex B-1 to B-6 documents pertaining to complainant. On perusal of the Ex B-1 discharge summary shows the complainant undergone by pass surgery and it shows date of admission 05/12/2012 date of discharge 15/02/2012. It is clearly shows that the complainant had hospitalized as an inpatient for a period of 10 days and he had undergone by pass surgery in the month of December-2012. It is clearly shows that complainant has fell sudden heart problem earlier to his by pass surgery. Ex B-2 to B-6 special Medical report of the complainant. It shows complainant health condition is normal, Ex B-7 Medical examiners confidential report dated 30/09/2013 it shows in column No.15 stated as follows. On examination whether he/she appears mentally and physically healthy? yes. It show at the time of examination i.e. on 30/09/2013 the complainant is physically and mentally healthy. Ex B-11 Ex B-12 and Ex B-13 personal statement regarding health shows in column 4 shows good, Ex B-14 physicians report. Ex B-18 online underwriting Decisions of Actuarial Department south Central zone dated 22/01/2014. Ex B-20 online revival decision dated 13/02/2014. Ex B-21 Ops office letter dated 08/03/2014 written to complainant. Ex B-22 office letter dated 13/03/2014 addressed to Divisional Office Shivomoga, Ex B-23 requisition letter submitted by the complainant policy. Ex B-24 online underwriting decision dated 19/03/2014 Ex B-25 certified copy of letter dated 19/03/2014 address to complainant by Branch office, Challakere Ex B-26 central office mail dated 27/08/2014 intimating the reasons for declining the revival of complainant policy, Ex B-27 reply notice dated 05/06/2014, Ex B-21 date 08/03/2014 shows that the Op informed the complainant his policy cannot be considered for revival and declined. On perusal of the version, affidavit and documents like Ex B-21, Ex-B-25 and Ex B-26 shows that the Op has not considered the complainant policy for revival and Op has not ready to collect the due premiums and also the reasons for non-acceptance of revival based on medical reports, the medical report of complainant shows that the complainant suffered and taking treatment for heart decease.
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20. On perusal of the complaint affidavit evidence and documents. It is clearly shows that complainant obtained LIC Policy from Op for sum assured Rs.10 lakhs and paid 5 premiums half yearly and also shows complainant undergone by pass surgery and further shows, later complainant approached the Op and requested to collect the premium which is due. On perusal of the entire case papers and documents. It's shows the complainant has oftenly visit the Op office and informed his health condition and requested to collect the due premiums and revival of his policy but Op has replied merely stating that "policy cannot be considered for revival" with out giving any valid reasons. As per the contention of Op the surrender value, premium under the policy to be paid for a minimum periods 3 years. In this case complainant has not surrender the policy he requested to revival of the policy in case of the surrender of the policy at least full 3 years premium have been paid in respect of the policy remitted the premium for a minimum periods 3 years as per the condition of the policy. But in this case complainant has requested to revival of the policy. So the question of policy condition para 4 non-forfeiture regulation does not arise. It is clearly shows that the complainant has ready to pay the due premiums but Op has not ready to receive the premiums and also Op has not ready to revival of the policy. Life insurance is a contract it is clearly shows complainant is ready and willing to pay due premiums but Op has not ready to collect or accepting the due premium of September-2012 without valid reasons the act of the Op amounts unfair trade practice and deficiency in service towards complainant. Op has issued the LIC policy to the complainant and to collecting the premium by name "Jeevan Anand" but the attitude of the Op has not given any Anand in the life of complainant i.e life assured because complainant paid 5 half yearly premiums of Rs.44,763/- each. If the Op has not interest to revival of the policy he must return the premiums collected from the complainant. If the Op has not considered the policy revival Op should pay the 5 premiums collected by them. Because the complainant is already under gone by pass surgery and he spent more amount towards his health. If the Op cannot be considered the revival of the policy. Life assured and his family members suffer financially therefore it is the duty of the Op to return the premiums which is collected from the complainant along with interest and other benefits. Op has not at all to escaped from his liability. So the Op is liable to return the premiums which is collected from the complainant i.e. sum of Rs.2,23,815/- with 12% interest from the date of declined i.e. 8/03/2014 till the date of payment and also Op has liable to pay the compensation of Rs.10,000/- towards mental agony and Rs.5,000/- towards cost of this proceedings to the complainant within two months. Accordingly we answer the point No.1 is held as affirmative and point No.2 is held as affirmative."
5. This order was impugned before the State Commission by the Petitioner. The State Commission passed the following order:
"9. Thus, admittedly, the complainant had obtained Jeevan Anand policy on 28.03.2020 for assured sum of ₹10.00 Lakhs and premium payable is ₹44,763/- half yearly. He also paid 5 premiums, but subsequently he defaulted for the reason that he was hospitalized; when he approached for revival of the policy same was repudiated by the Insurance Company on the ground that as detailed in the reply to the legal notice marked as Ex.B27. On perusal of Ex.B27 it is seen that as premium was not paid for 3 years, he is not entitled for surrender value of the policy and with regard to non-revival of the policy it is stated as hereunder:
"original policy contract terminates immediately after lapsation of the policy for non-payment of due premiums. He has applied for revival of the policy by submitting the relevant Medical report. Policy revival is a new contract. Revival decisions are based on the Medical fitness of the lie assured. After going through the reports, our competent authority have taken decision to decline the revival. Since the act of Dr.Manjunath Reddy has led to the breach of contract, we sincerely regret to accept the points raised in your legal notice."
10. Thus, neither revival was accepted nor accepted for refund of the premium by the LIC. Thus, it is seen that revival is declined only based on medical fitness, but they have not mentioned what type of ailment disentitles the complainant for revival of the policy. Competent authority while declining to revive the policy has not mentioned the reasons for the same. Further on perusal of the records it is seen that the Opposite Party Nos.1 and 2 instructed the complainant to resubmit paper for revival along with 1. ATMT after cardiologist approval, 2. 2D Echo 3. Phys. Report all parts 4. Income proof, as per AML guidelines 5. Fresh DGH. On perusal of the records the OP himself has produced said documents. On perusal of Ex.B6, report of the ECG it is seen that under the head conclusion it is mentioned as "normal ECG recording except prolonger P-R internal" and also Ex.B7 discloses that at Column 15 it is mentioned that on examination the claimant appeared to be mentally and physically healthy. Ex.B16 computerised treadmill test to which report is enclosed and marked as Ex.B17 wherein it is mentioned as "stress test is negative for inducible ischemia". Thus, except the financial status all other reports are in favour of the complainant. Regarding financial status neither the complainant nor the OP has produced any document. However, admitting his profession as medical practitioner it cannot be said that he is not capable of paying the premium.
11. Thus, the complainant has submitted for revival along wit required documents despite the same, the OP has rejected the revival without assigning any reasons. He is not made known for what condition his policy was not entitled for revival. In the circumstances, the observation of the District Forum that OP committed deficiency in service towards complainant is proper. Further it is seen that condition NO.3 of the policy though it says "insurability of the insured has to be established to the satisfaction of the corporation", it does not specify as to what is the definition of insurability and what was the condition to be complied with by the complainant. Hence, rejection of revival without giving any reasons is not proper. Thus, in the foregoing circumstances, as the OP cannot be enforced upon to revive the policy against its own decision, it is appropriate that amount paid by the complainant be ordered to be refunded by the OP. Further, irrespective of condition NO.4, as the complainant is entitled for revival of the policy which is not accepted by the OP, as an alternate remedy condition No.4, is not applicable to the facts of the case. Hence, impugned order is sustainable."
6. This order is impugned before us on the same ground that revival of the policy is a discretion of Petitioner which they have exercised against the revival of the policy and that they are not liable to refund the premium amount. Reliance is also placed on the findings of this Commission in the case of "LIC Of India vs. Memuna, II(2006) CPJ 86 (NC)". The findings in a case are given in the facts and circumstances of that case which are different from the facts and circumstances in this case. In Memuna's case (supra), the facts as shown clearly show that the insured in that case had not disclosed his illness and hospitalization while sending proposal for getting the insurance policy revived in April-May 1996 while in the present case as per the evidences on record, the Complainant had duly disclosed his illness and also submitted all the relevant documents along with his request for revival of his policy. Therefore, the findings in Memuna's case (supra) are not relevant in the facts and circumstances of this case.
7. Also in Memuna's case (supra), the insured had made no efforts for revival of the policy for five years, after it was lapsed in September 1988. In the present case, however, the facts clearly show that immediately on recovery from illness, the Complainant made all the efforts for revival of his policy and had also personally visited the office of the Petitioner. Findings given on the peculiar facts and circumstances of the Memuna's case (supra) thus is not applicable on the facts of this case.
8. In the case of "Rubi (Chandra) Dutta Vs. United India Insurance Co. Ltd. - (2011) 11 SCC 269" the Hon'ble Supreme Court has held that this Commission does not have jurisdiction to re-appreciate and re-assess the evidences on record and then make its own opinion and substitute its opinion with the concurrent findings on the facts. The Hon'ble Supreme Court has held as under:
"23. Also, it is to be noted that the revisional powers of the National Commission are derived from Section 21 (b) of the Act, under which the said power can be exercised only if there is some prima facie jurisdictional error appearing in the impugned order, and only then, may the same be set aside. In our considered opinion there was no jurisdictional error or miscarriage of justice, which could have warranted the National Commission to have taken a different view than what was taken by the two Forums. The decision of the National Commission rests not on the basis of some legal principle that was ignored by the Courts below, but on a different (and in our opinion, an erroneous) interpretation of the same set of facts. This is not the manner in which revisional powers should be invoked. In this view of the matter, we are of the considered opinion that the jurisdiction conferred on the National Commission under Section 21 (b) of the Act has been transgressed. It was not a case where such a view could have been taken by setting aside the concurrent findings of two Fora".
9. In the present case, there are concurrent findings of fact by the Forum below. The Petitioner has failed completely to point out that the Forum below have exercised its jurisdiction wrongly or that any miscarriage of justice has been caused to it. The present Revision Petition is thus dismissed with no order as to costs.
......................J DEEPA SHARMA PRESIDING MEMBER ...................... C. VISWANATH MEMBER