State Consumer Disputes Redressal Commission
Sukhwinder Singh vs The Manager, Aviva Life Insurance on 7 June, 2013
2nd Addl. Bench
STATE CONSUMER DISPUTES REDRESSAL COMMISSION, PUNJAB
DAKSHIN MARG, SECTOR 37-A, CHANDIGARH
First Appeal No. 1006 of 2011
Date of institution: 1.7.2011
Date of decision : 7.6.2013
Sukhwinder Singh son of Sh. Hamir Singh Resident of Village Bhago
Majra, Tehsil and District Mohali.
.....Appellant
Versus
1. The Manager, Aviva Life Insurance, 5th Floor, JMD Regent
Square, Gurgaon-Mehrauli Road, Gurgaon - 122 001.
2. M/s AVIVA Life Insurance Company India Ltd., Branch Office : 2nd
and 3rd Floor, S.C.F. No. 49, Phase 9, Mohali through its Branch
Manager.
3. Sh. Gurpal Singh, F.P.C. (Financial Planning Consultant), c/o
Opposite Parties No. 1 & 2.
.....Respondents
2nd Appeal
First Appeal No. 1007 of 2011
Date of institution: 1.7.2011
Bahadur Singh son of Jarnail Singh, Resident of Village Bhago Majra,
Tehsil Majra, District Mohali.
.....Appellant
Versus
1. The Manager, Aviva Life Insurance, 5th Floor, JMD Regent Square,
Gurgaon-Mehrauli Road, Gurgaon - 122 001.
2. M/s AVIVA Life Insurance Company India Ltd., Branch Office : 2nd
and 3rd Floor, S.C.F. No. 49, Phase 9, Mohali through its Branch
Manager.
3. Sh. Gurpal Singh, F.P.C. (Financial Planning Consultant), c/o
Opposite Parties No. 1 & 2.
.....Respondents
3rd Appeal
First Appeal No. 1008 of 2011
Date of institution: 1.7.2011
Kuldeep Singh son of Hamir Singh, Resident of Village Bhago Majra,
Tehsil & District Mohali.
First Appeal No. 1006 of 2011 2
.....Appellant
Versus
1. The Manager, Aviva Life Insurance, 5th Floor, JMD Regent Square,
Gurgaon-Mehrauli Road, Gurgaon - 122 001.
2. M/s AVIVA Life Insurance Company India Ltd., Branch Office : 2nd
and 3rd Floor, S.C.F. No. 49, Phase 9, Mohali through its Branch
Manager.
3. Sh. Gurpal Singh, F.P.C. (Financial Planning Consultant), c/o
Opposite Parties No. 1 & 2.
.....Respondents
4th Appeal
First Appeal No. 1009 of 2011
Date of institution: 1.7.2011
Gurmukh Singh son of Santokh Singh, Resident of Village Manak Majra,
P.O. Sohana, Tehsil and District Mohali.
.....Appellant
Versus
1. The Manager, Aviva Life Insurance, 5th Floor, JMD Regent Square,
Gurgaon-Mehrauli Road, Gurgaon - 122 001.
2. M/s AVIVA Life Insurance Company India Ltd., Branch Office : 2nd
and 3rd Floor, S.C.F. No. 49, Phase 9, Mohali through its Branch
Manager.
3. Sh. Gurpal Singh, F.P.C. (Financial Planning Consultant), c/o
Opposite Parties No. 1 & 2.
.....Respondents
5th Appeal
First Appeal No. 1010 of 2011
Date of institution: 1.7.2011
Charanjit Kaur wife of Baldev Singh, Resident of Village Sante Majra, P.O.
Landran, District Mohali.
.....Appellant
Versus
1. The Manager, Aviva Life Insurance, 5th Floor, JMD Regent Square,
Gurgaon-Mehrauli Road, Gurgaon - 122 001.
2. M/s AVIVA Life Insurance Company India Ltd., Branch Office : 2nd
and 3rd Floor, S.C.F. No. 49, Phase 9, Mohali through its Branch
Manager.
3. Sh. Gurpal Singh, F.P.C. (Financial Planning Consultant), c/o
Opposite Parties No. 1 & 2.
.....Respondents
First Appeal No. 1006 of 2011 3
6th Appeal
First Appeal No. 1011 of 2011
Date of institution: 1.7.2011
Gurmukh Singh son of Santokh Singh, Resident of Village Manak Majra,
P.O. Sohana, Tehsil and District Mohali.
.....Appellant
Versus
1. The Manager, Aviva Life Insurance, 5th Floor, JMD Regent Square,
Gurgaon-Mehrauli Road, Gurgaon - 122 001.
2. M/s AVIVA Life Insurance Company India Ltd., Branch Office : 2nd
and 3rd Floor, S.C.F. No. 49, Phase 9, Mohali through its Branch
Manager.
3. Sh. Gurpal Singh, F.P.C. (Financial Planning Consultant), c/o
Opposite Parties No. 1 & 2.
.....Respondents
7th Appeal
First Appeal No. 1012 of 2011
Date of institution: 1.7.2011
Baldev Singh son of Sh. Banta Singh, Resident of Village Sante Majra,
P.O. Landran, District Mohali, Tehsil Kharar, Mohali
.....Appellant
Versus
1. The Manager, Aviva Life Insurance, 5th Floor, JMD Regent Square,
Gurgaon-Mehrauli Road, Gurgaon - 122 001.
2. M/s AVIVA Life Insurance Company India Ltd., Branch Office : 2nd
and 3rd Floor, S.C.F. No. 49, Phase 9, Mohali through its Branch
Manager.
3. Sh. Gurpal Singh, F.P.C. (Financial Planning Consultant), c/o
Opposite Parties No. 1 & 2.
.....Respondents
First Appeal against the order dated 24.5.2011
passed by the District Consumer Disputes
Redressal Forum, S.A.S. Nagar (Mohali).
Before:-
Shri Piare Lal Garg, Presiding Member
Shri Jasbir Singh Gill, Member Present:-
For the appellants : Sh. Sandeep Bhardwaj, Advocate First Appeal No. 1006 of 2011 4 For the respondents : Sh. Sandeep Suri, Advocate with Sh. Arun Dogra, Advocate PIARE LAL GARG, PRESIDING MEMBER This order will dispose of following seven appeals:-
S. First Appeal Name of the appellant Name of the Date of No. No. respondent Decision
1. 1006 of 2011 Sukhwinder Singh The Manager, Aviva 24.5.2011 Life Ins. & others
2. 1007 of 2011 Bahadur Singh The Manager, Aviva 24.5.2011 Life Ins. & others
3. 1008 of 2011 Kuldeep Singh The Manager, Aviva 24.5.2011 Life Ins. & others
4. 1009 of 2011 Gurmukh Singh The Manager, Aviva 24.5.2011 Life Ins. & others
5. 1010 of 2011 Charanjit Kaur The Manager, Aviva 24.5.2011 Life Ins. & others
6. 1011 of 2011 Gurmukh Singh The Manager, Aviva 24.5.2011 Life Ins. & others
7. 1012 of 2011 Baldev Singh The Manager, Aviva 24.5.2011 Life Ins. & others In all the appeals the facts and dispute between the parties is same. The District Consumer Disputes Redressal Forum, S.A.S. Nagar (Mohali)(in short the "District Forum") dismissed all the complaints in a single order. The grounds of appeals are also same. The facts are taken from 'First Appeal No. 1006 of 2011' and the parties would be referred by their status in this appeal.
2. Brief facts of the case are that the appellants are farmers and in the year 2006-07 farmers of their villages got certain amounts as they had sold their land. They were having bank accounts with the Centurian Bank of Punjab, which was succeeded by the HDFC Bank Ltd.. Respondent No. 3 Gurpal Singh was the Executive of respondent Nos. 1 & First Appeal No. 1006 of 2011 5 2 and met the appellants to invest their money as one time investment plan of respondents No. 1 & 2. It was told by Gurpal Singh that after three years they would get double of the invested amount and in case they wanted refund of the amount or if they would not be satisfied with the plan, they could get it with simple bank rate interest. Respondent No. 3 got signature/thumb marked on the proposal forms from the appellants and they deposited different amounts as first premium and received the receipts regarding the deposit of the amounts. The detail of amounts, which were paid by the appellants is as under:-
Complaint No. Amount of first premium Date of payment 105 of 2011 Rs. 50,000/- 24.01.2007 107 of 2011 Rs. 50,000/- 30.05.2007 108 of 2011 Rs. 50,000/- 30.05.2007 109 of 2011 Rs. 50,000/-
110 of 2011 Rs. 25,000/- 17.08.2006 111 of 2011 Rs. 25,000/- 17.08.2006
3. It was further pleaded that almost all the appellants were illiterate and they could sign only in 'Punjabi' and some of them put their thumb impressions on the proposal form. The appellants were not able to read or write and understand the technicalities/information mentioned in the proposal forms, which were in English script. Respondent No. 3 also did not explain and disclosed the terms and conditions of the policy document/ terms and conditions mentioned in the proposal form. Huge amount as commission was received by said Gurpal Singh on selling the disputed policies to the illiterate appellants. It was also assured by him that he will again visit the village and explain the terms and conditions of the policy to the appellants but he never turned up to explain the same. The appellants after one year approached the respondents to seek refund of their deposited amount with interest as promised but it was told by the First Appeal No. 1006 of 2011 6 respondents that there was a lock-in-period of three years and they could get refund of their amounts after the expiry of three years and they had to pay two more installments, if they wanted refund of their amounts, which were deposited otherwise the policies would have lapsed. It was also told that only surrender value after deducting certain charges, which could run upto 60% of the total amount will be paid to the appellants. The amounts which were invested by the appellants with the hope to get good benefits in one time investment were shocked to hear the version of the respondents. The appellants under compelled circumstances deposited two more annual premiums/ installments except Baldev Singh respondent paid only one more premium and the appellant Sukhwinder Kaur had not paid any further premium/installment as they were not in a position to deposit the other installments. The appellants also pleaded in the complaint that their dates of birth and date of payment of last premium are as under:-
Complaint No. Date of Birth Date of payment of last premium 105 of 2011 22.09.1950 20.03.2035 107 of 2011 08.10.1976 29.05.2062 108 of 2011 17.03.1971 26.05.2056 109 of 2011 10.09.1952 10.09.2032 110 of 2011 08.12.1962 17.08.2048 111 of 2011 08.12.1962 17.08.2048
4. As per the policies, the appellants were required to pay huge amounts of the premiums over a long period but the maturity amount was very meager against the payments of the premiums which they had to pay and even they were not in a position to pay the installments for such a long time. It was also specifically pleaded by the appellant Charanjit Kaur being a house hold lady, she was not in a position, having no source of income to pay the regular premium as per the terms and conditions of the policy in dispute. The signatures were obtained by respondent No. 3 on blank First Appeal No. 1006 of 2011 7 proposal forms without verifying the financial position of the appellants whether they were able to deposit the installments of the premiums for such a long time. The appellants were also not medically examined. Legal notices were served upon the respondents for the refund of their amounts with interest but all in vain. There was no condition mentioned in the proposal forms that there will be any deduction if they sought refund of the amounts before the maturity of the policies. The act of the respondents was unfair trade practice as well as also deficiency in service specifically on the part of respondent No. 3, who mis-guided the appellants and sold the policies after concealing the real facts and consequences, of the amounts, which were got deposited from the appellants. The appellants filed the complaints with the prayer that the respondents may be directed to refund the amount of the appellants, which were deposited as premiums of policy in dispute with interest @ 18% per annum and also Rs. 50,000/- as compensation and Rs. 11,000/- as litigation expenses may also be awarded to each appellant.
5. Respondent No. 3 did not appear despite service, as such, he was proceeded against ex-parte by the District Forum vide interim order dated 28.3.2011.
6. Upon notice, reply was filed by respondents No. 1 & 2 jointly in all the complaints, which are almost identical. Preliminary objections were taken that the complaints were based on mere conjectures and surmises, false and frivolous allegations were leveled and there was no deficiency in service on the part of the answering respondents, the complaint was not maintainable before the District Forum, the appellants have not approached the District Forum with clean hands, the complaints were also liable to be dismissed as there was no consumer dispute between the First Appeal No. 1006 of 2011 8 parties. The appellants had breached the terms and conditions of the policy, as such, the complaints were liable to be dismissed. There was 15 days lock in period and the appellant/complainants could cancel their policies but they did not do so. The appellants did not seek refund of their premiums within 15 days from the receipt of policy and terms and conditions. It was also denied that any assurance was given to the appellants that they could withdraw the amount after the payment of three yearly premiums. The policies were life long policies approved by I.R.D.A. and were Unit Linked. The amount of the premiums were invested in units and the value of the same keeps changing being market driver. Higher of the insured amount of the fund value was payable in case of death. It was also denied that the terms and conditions of the policies were not explained to the appellants or the premiums were taken from the appellants befooling the appellants or any wrong information was given to the appellants by the respondents. It was alleged that there was no deficiency or unfair trade practice on the part of the answering respondents and dismissal of the complaints was prayed.
7. After hearing the counsel for the parties and going through the record, all the complaints were dismissed by the District Forum.
8. Aggrieved from the order of the District Forum, the appeals are filed by the appellants on the grounds that the complaints are not barred by limitation as the limitation starts from the refund of the paid up value and the same was not paid till the filing of the complaint, the findings of the District Forum regarding the limitation are not correct, the order of the District Forum is against Circular No. 049 of I.R.D.A. dated 1.1.2008, the District Forum accepted complaint Nos. 450 & 451 titled as "Nirmal Singh Vs. Aviva Life Ins. Co.", decided on 5.4.2010 and 11.3.2010 and First Appeal No. 1006 of 2011 9 consumer complaints No. 347, 348 and 349 of 2010 decided on 1.11.2010, the dispute in these complaints was also same, which is in the present appeals, as such, the orders of the District Forum are self contradictory and on the basis of pick and choose, the orders of the District Forum is against the evidence on record, as such, the same are liable to be set- aside.
9. We have gone through the pleadings of the parties, grounds of appeal, perused the record of the learned District Forum and heard the arguments of the counsel for the parties.
10. It is pleaded by the respondents that the insurance contracts were entered and agreed upon between the parties on standard terms and conditions. Policy schedule and key feature documents in which it was clearly explained the charges applicable on the policy and right to consider were sent to the appellants but no date is mentioned in the reply when the parties entered into the insurance contracts. In para No. 13 of the preliminary objections it is mentioned that "on 29.5.2006: Policy dispatch via Overnite # 510226622" but no receipts were produced which were issued by Overnite Courier to prove that the policies with terms and conditions were dispatched by the respondents to the appellants. Neither the affidavit nor the person who delivered Overnite courier was examined. The respondents had also not produced the chart of delivery man, whether the signatures/thumb marks of the receiver were obtained by the delivery man of overnite courier. So the version of the respondents that the appellants could cancel the policies within 15 days from the receipt of the terms and conditions of the policy does not arise as the respondents have failed to prove that policies with terms and conditions were supplied by the respondents to the appellants.
First Appeal No. 1006 of 2011 10
11. It is also admitted case of the parties that respondent No. 3 had approached the appellants and on his allurement the amount was paid/deposited as first premium by the appellants with respondents No. 1 & 2 through respondent No. 3. It is also admitted case of the parties that the signatures/thumb impressions on proposal form were obtained by respondent No. 3 Gurpal Singh, who was employee / Financial Consultant of the respondents. Neither affidavit of said Gurpal Singh was tendered into evidence nor he was examined to prove that he had obtained the signatures/ thumb impressions of the appellants after explaining the terms and conditions of the policy. Gurpal Singh was a material witness, who could prove the version of the respondents that the terms and conditions of the policy were explained by him to the appellants and after admitting the same to be correct, they signed or thumb marked on the proposal forms. The evidence of the material witness is withheld by the respondents for the reason best known to them. It is also not the version of respondents No. 1 & 2 that respondent No. 3 Gurpal Singh left the job or the answering respondents are not aware of the address of respondent No. 3 or his whereabouts are not known to respondents No. 1 & 2.
12. It is also admitted case of the parties that except Charanjit Kaur appellant (complainant in Complaint No. 109 of 2011), who paid only one premium and Baldev Singh and Bahadur Singh appellants (complainants in Complaint Nos. 105 & 106 of 2011) paid one more premium and other appellants paid two more annual premiums to the respondents in lieu of the policies in dispute. The appellants made a request to the respondents for the refund of the premiums with interest @ 18% p.a. from the date of deposit till its refund but when the amounts were not refunded by the respondents then the appellants served the First Appeal No. 1006 of 2011 11 respondents with legal notices dated 14.2.2011 Ex. C-3 through their counsel Sh. Sandeep Bhardwaj, Advocate but even then amounts were refunded by the respondents to the appellants.
13. The complaints of the appellants were dismissed by the District Forum on the ground that the complaints were time barred and not filed within limitation. But the findings of the District Forum that the complaints were time barred are not correct as the premiums with interest as prayed were not refunded till the date of filing of the complainants and it is also not the pleaded case of the respondents that the amounts of the premiums were refunded or the appellants were not entitled for the refund of any amount as per terms and conditions of the policy. The cause of action is recurring one; as no final decision regarding the refund of the premiums or repudiation of the same was conveyed by the respondents to the appellants till today. It is held by the Hon'ble Supreme Court in case "Oriental Insurance Company Ltd. versus Prem Printing Press", I (2009) CPJ 55 (SC) that final decision regarding repudiation was conveyed on 28.7.1994, as such, till then the cause of action is recurring one and observed in para No. 3(relevant part) as follows:-
"3. This leaves us in no doubt that the final decision about the repudiation was conveyed on 28.7.1994 and till then, the appellant kept on dangling a carrot of hope before the respondent herein that the matter regarding repudiation of claim was being considered afresh........"
14. It is also held by the Hon'ble National Commission in case "United India Insurance Company Ltd. & Anr. versus R. Piyarelall Import & Export Ltd.", I (2010) CPJ 22 (NC) in para No. 6 as follows:-
"6. We have carefully gone through the material on record. There is a statement brought on record by the complainant, wherein as on 7.8.1996, a total sum of Rs. 2,58,483 was available with the Insurance Company and they have been merrily deducting the premiums in respect of various vessels and as on that First Appeal No. 1006 of 2011 12 date there was a balance of Rs. 38,132. It is also not in dispute that another amount of Rs. 39,398 was paid to the Insurance Company on 20.8.1996, meaning thereby, that there was sufficient funds available 'in deposit' with the Appellants, from which the premium could be deducted."
15. Respondents neither informed the appellants regarding the lapse of the policies nor notice under Section-50 of the Insurance Act is given and paid up value of the policies was also not paid to the appellants as required under Section 50 of the Insurance Act. Section-50 of the Insurance Act is reproduced as follows:-
"50. Notice of options available to the assured on the lapsing of a policy:-
An insurer shall, {before the expiry of three months from the date on which the premiums in respect of a policy of life insurance were payable, but not paid}, give notice to the policy-holder informing him of the options available to him {unless these are set forth in the policy}".
16. So as per the law laid down by the Hon'ble Supreme Court as well as by the Hon'ble National Commission, the complaints were filed within limitation.
17. The respondents have also not mentioned/ pleaded in the replies to the complaints that the appellants were not entitled for the amount to be refunded against the premiums, which were paid by the appellants to the respondent. The version of the counsel for the appellants is that the appellants are entitled for the refund of the premiums as per notification/guidelines issued by I.R.D.A. vide notification dated 1.7.2010. Regulation No. 7 of the above notification deals with the refund of the amount upon discontinuation of policies, which is reproduced:-
"Obligation of an insurer upon discontinuation of a policy
7. The obligation of an insurer in this regard shall be as follows:-
i. To impose discontinuance charges only to recoup expenses incurred towards procurement, administration of the policy and incidental thereto. ii. To design the discontinuance charges to encourage the policyholder to continue with the contract for the full term; iii. To ensure that the discontinuance charges reflect the actual expenses incurred.First Appeal No. 1006 of 2011 13
iv. To structure the discontinuance charges within the statutory ceiling on commissions and expenses and v. To ensure that the charges levied on the date of discontinuance (as a percentage of one annualized premium) do not exceed the limits specified below:-
Where the policy is Maximum Discontinuance Maximum discontinuance
discontinued charges for policies having charges for policies having
during the policy annualized premium up to annualized premium above
year an including Rs. 25000/- Rs. 25000/-
1 Lower of 20% (AP or FV Lower of 6% of (AP or FV)
subject to a maximum of subject to maximum of Rs.
Rs. 3000/-) 6000/-
2 Lower of 15% (AP or FV Lower of 4% of (AP or FV)
subject to a maximum of subject to maximum of Rs.
Rs. 2000/-) 5000/-
3 "Lower of 10% (AP or FV Lower of 3% of (AP or FV)
subject to a maximum of subject to maximum of Rs.
Rs. 1500/-) 4000/-
4 Lower of 5% (AP or FV Lower of 2% of (AP or FV)
subject to a maximum of subject to maximum of Rs.
Rs. 1000/-) 2000/-
5 NIL NIL
Ap-Annualised premium
Fv-fund value on the date of discontinuance
Provided that where a policy is discontinued, only discontinuance charge may be levied by the insurer and no other charges by whatsoever name called shall be levied.
Provided that no discontinuance charges shall be imposed on single premium policies and on top ups."
18. The version of the counsel for the respondents is that as the policies were purchased by the appellants in the year of 2006 and Baldev Singh - complainant/appellant in 2007, as such, notification dated 1.7.2010 is not applicable from retrospective effect. But this version of the respondents is not correct as the appellants requested the respondents for the refund of the premium in the year of 2011 and the legal notices were also served upon the respondents in the year of 2011, as such, the cause of action arose to the appellants to file the complaints in the year, 2011 when the amounts were refunded by the respondents and at that time, the notification dated 1.7.2010 was in existence and the same is fully applicable. It is also held by the Hon'ble State Consumer Disputes First Appeal No. 1006 of 2011 14 Redressal Commission, Union Territory, Chandigarh in Complaint No. 55 of 2012 decided on 19.3.2013 titled as "Ms. Bimla Nainwal versus M/s. Aviva Life Insurance Co. Ltd. etc." and the dispute in the above complaint was similar to the facts of the present complaints/appeals. The relevant para of the judgment is reproduced:-
"Admittedly the complainant took the policy, in question, in the year 2008, and paid three installments and thereafter stopped making payments. Opposite Party No. 1, after calculating the surrender value, sent a cheque in the sum of Rs. 5.00 lacs, at the address of the complainant mentioned in the proposal form. We find merit, in the contention of the Counsel for the complainant, that since Opposite Party No. 1 was governed by the guidelines and Policies of the IRDA, the surrender value calculated by it, was in contravention of guidelines issued by the IRDA vide notification dated 1.7.2010. Insurance Regulatory and Development Authority (Treatment of Discontinued Linked Insurance Policies) Regulations, 2010, were notified vide notification dated 1.7.2010. Regulation 7 of the Regulations ibid reads as under;
"Obligation of an insurer upon discontinuation of a policy
7. The obligation of an insurer in this regard shall be as follows:-
i. To impose discontinuance charges only to recoup expenses incurred towards procurement, administration of the policy and incidental thereto. ii. To design the discontinuance charges to encourage the policyholder to continue with the contract for the full term; iii. To ensure that the discontinuance charges reflect the actual expenses incurred.
iv. To structure the discontinuance charges within the statutory ceiling on commissions and expenses and v. To ensure that the charges levied on the date of discontinuance (as a percentage of one annualized premium) do not exceed the limits specified below:-
Where the policy is Maximum Discontinuance Maximum discontinuance
discontinued charges for policies having charges for policies having
during the policy annualized premium up to annualized premium above
year an including Rs. 25000/- Rs. 25000/-
1 Lower of 20% (AP or FV Lower of 6% of (AP or FV)
subject to a maximum of subject to maximum of Rs.
Rs. 3000/-) 6000/-
2 Lower of 15% (AP or FV Lower of 4% of (AP or FV)
subject to a maximum of subject to maximum of Rs.
Rs. 2000/-) 5000/-
3 "Lower of 10% (AP or FV Lower of 3% of (AP or FV)
subject to a maximum of subject to maximum of Rs.
Rs. 1500/-) 4000/-
4 Lower of 5% (AP or FV Lower of 2% of (AP or FV)
subject to a maximum of subject to maximum of Rs.
First Appeal No. 1006 of 2011 15
Rs. 1000/-) 2000/-
5 NIL NIL
Ap-Annualised premium
Fv-fund value on the date of discontinuance
Provided that where a policy is discontinued, only discontinuance charge may be levied by the insurer and no other charges by whatsoever name called shall be levied.
Provided that no discontinuance charges shall be imposed on single premium policies and on top ups."
Admittedly, cause of action arose to the complainant, when the policy of the complainant was discontinued in 2012, i.e. after payment of three consecutive premiums of Rs. 5.00 lac each, and she was sent a cheque of Rs. 5.00 lacs towards surrender value, whereas, the aforesaid Regulations came into force, in the year 2010."
19. The District Forum, Mohali in complaint No. 136 of 2011 decided on 23.6.2011 titled as "Lakhvir Singh versus Aviva Life Ins. Co. Ltd. etc." accepted the complaint in which the similar dispute was involved, as such, the order of the District Forum dismissing the complaints of the appellants and accepting complaint No. 136 of 2011 are self contradictory, as such, the orders under appeals of the District Forum are not sustainable.
20. We have perused the proposal forms tendered into evidence by the respondents as Ex. R-1 in evidence. From the proposal forms, it is established that the appellants were illiterate/uneducated persons and some of them signed in Punjabi and others marked their thumb impression upon the proposal forms. From the perusal of the signatures it is also proved that they could sign in Punjabi only.
21. In the proposal form, there is a declaration by one Jasjit Singh resident of H. No. 2094-A Flats, Sector 66, Mohali to the effect that "he fully explained the contents of the proposal form to the insured". But neither his affidavit nor he was examined by the respondents to prove its First Appeal No. 1006 of 2011 16 version that the contents of the proposal forms were explained in Vernacular language to the insurer by the declarant - Jasjit Singh.
22. The proposal form is of 7 pages and printed in very small letters in 'English' and it cannot be read over and understood by the persons like the appellants. The terms and conditions mentioned in the proposal forms are such technical, complicated that even an educated person cannot understand without the assistance of any legal person or insurance advisor of long standing. All columns of the proposal forms are also not filed and lying vacant. Page No. 7 of the proposal form is lying vacant and cancelled, which is Customer Copy. From this page, it is also proved that no copy of the proposal form was also provided by the respondents to the appellants.
23. The respondents also not taken/collected any document regarding the income proof of the appellants to satisfy itself whether the appellants had the sufficient source of income to pay the premium or not, which was mandatory as per instructions of the I.R.D.A.. The KYC norms are fully applicable to the policies in dispute as it is admitted fact of the respondents that the policy in dispute were approved by the I.R.D.A.
24. The version of the appellants is that at the time of taking the premium and signature/thumb marks on the proposal forms, it was disclosed by respondent No. 3 that the appellants had to pay only one time premium but as per the terms and conditions of the policies, the last date of payment of the premium were as under:-
Complaint No. Date of Birth Date of payment of last premium 105 of 2011 22.09.1950 20.03.2035 107 of 2011 08.10.1976 29.05.2062 108 of 2011 17.03.1971 26.05.2056 First Appeal No. 1006 of 2011 17 109 of 2011 10.09.1952 10.09.2032 110 of 2011 08.12.1962 17.08.2048 111 of 2011 08.12.1962 17.08.2048
25. From the above details, it is clear that some of the insurers would be very old or no more alive at the time of maturity of the policies. As per the schedule of the premiums the appellants were required to pay huge amounts of the premiums for such a long time but they were insured under the policies for very meager amount, which was also unfair trade practice on the part of the respondents and it was exploitation of the poor and uneducated farmers by the respondents.
26. In view of the above discussion, all the above mentioned appeals of the appellants are accepted and the order of the District Forum is set-aside. The respondents are directed to refund the premiums after deducting the amount as per Regulation No. 7 of the notification dated 1.7.2010 issued by I.R.D.A. (Treatment of Discontinued Linked Insurance Policies) Regulations, 2010 within 30 days from the receipt of copy of the order. If failed to comply with the order, then respondents will be liable to pay interest @ 9% p.a. from the date of filing of the complaints till realization.
27. The respondents are also directed to pay Rs. 15,000/- as compensation to each appellant/complainant and Rs. 5,000/- as litigation expenses within thirty days from the receipt of copies of the orders.
28. The arguments in these appeals were heard on 29.5.2013 and the orders were reserved. Now the orders be communicated to the parties.
29. The appeals could not be decided within the statutory period due to heavy pendency of Court cases.
29. Copy of this order be placed on:-
First Appeal No. 1006 of 2011 18
S. No. First Appeal Name of the appellant Name of the respondent No.
1. 1007 of 2011 Bahadur Singh The Manager, Aviva Life Ins. & others
2. 1008 of 2011 Kuldeep Singh The Manager, Aviva Life Ins. & others
3. 1009 of 2011 Gurmukh Singh The Manager, Aviva Life Ins. & others
4. 1010 of 2011 Charanjit Kaur The Manager, Aviva Life Ins. & others
5. 1011 of 2011 Gurmukh Singh The Manager, Aviva Life Ins. & others
6. 1012 of 2011 Baldev Singh The Manager, Aviva Life Ins. & others (Piare Lal Garg) Presiding Member June 7, 2013. (Jasbir Singh Gill) as Member