State Consumer Disputes Redressal Commission
Senior Divisional Manager,Trichy ... vs Vijayakumari ,Sirumugai, ... on 26 October, 2010
BEFORE THE STATE CONSUMER DISPUTES REDRESSAL COMMISSION, CHENNAI BEFORE THE STATE CONSUMER DISPUTES REDRESSAL COMMISSION, CHENNAI Present Hon'ble Thiru Justice M. THANIKACHALAM PRESIDENT Thiru S. Sambandam, B.Sc., MEMBER II F.A.NO.102/2007 (Against order in O.P.NO.149/2002 on the file of the DCDRF, Coimbatore) DATED THIS THE 26th DAY OF OCTOBER 2010 Senior Divisional Manager Life Insurance Corporation of India Trichy Road, Coimbaore Appellant/ 1st Opposite party Vs. 1.
Vijayakumari W/o. Vellingiri
2. Minor Mohanapriya D/o. Vellingiri
3. Minor Manimehalai D/o. Vellingiri
4. Pachaiammal W/o. Arumugam All are residing at No.6/297-B, Ganeshapuram Sirumugai, Mettupalayam Taluk Respondents/ Complainants
5. South India Viscose Industries Ltd., Rep. by its Senior Manager (Personnel) Sirumugai, Mettupalayam Taluk Respondent/ 2nd Opposite party The 1st Respondent as complainant filed a complaint before the District Forum against the Appellant/ 1st opposite arty, and 2nd Respondent/2nd opposite party, praying for the direction to pay Rs.2,00,000/- as per the terms of the policies, alongwith compensation of Rs.10000/- and cost. The District Forum allowed the complaint against 1st opposite party. Against the said order, this appeal is preferred praying to set aside the order of the District Forum dt.13.12.2005 in CC. No.149/2002.
This petition coming before us for hearing finally on 07.10.2010. Upon hearing the arguments of the counsel on either side, perusing the material papers on record, lower court orders, and the order passed by the District Forum, this commission made the following order :
Counsel for the Appellant/1st opposite party: Mr. M.B.Gopalan, Advocate 1 to 4 Respondents/ Complainants: Mr. A. Bobblie, Advocate M. THANIKACHALAM J, PRESIDENT
1. The 1st opposite party is the appellant.
2. Mr. Vellingiri, husband of the 1st complainant, father of complainants 2 to 4, was employed as a worker in the South India Viscos Industries, i.e., the 2nd opposite party. He had taken three Insurance Policies dt.13.8.94, 28.2.2001, for the sum assured Rs.1,00,000/-, Rs.25000/- and Rs.25000/-, respectively, which covers accident benefit also.
3. The 2nd opposite party, as per the understanding with the 1st opposite party, had deducted the insurance premium amount, for the above said policies, from the salary of Vellingiri, and they have to remit the same, within the stipulated period. Accordingly, the 2nd opposite party was deducting the premium from the salary, which was not informed to the deceased Vellingiri, whereas, if at all, it will be reflected in the pay slip. It appears, the 2nd opposite party was not remitting the premium amount, periodically, whereas remitted once in 3 or 4 months, at his discretion and convenience.
4. In case, the employer is unable to remit the premium, for the reason that non-payment of salary or non-eligibility of the salary, they should intimate to assured, failing which, they should be held responsible. The premium has been paid upto October 2001, for the policies taken by Mr.Vellingiri.
5. On 29.11.2001, Vellingiri met with a motor accident, sustained injuries, succumbed to same, on the same day, which was informed to the opposite party. The complainant, as the legal heirs of the deceased/assured, as well as the 1st complainant, being the nominee, entitled to the benefits of the policy, including the amount assured, on which basis a claim was made, which elicited a reply, as if the insurance company is liable to pay only a sum of Rs.7760/-, being the premium amount paid. Even after the issuance of notice, the opposite parties failed to pay the sum assured, which should be construed as deficiency, which had caused mental agony also to the complainant, for which they are entitled to compensation, in terms of money. On the above said grounds, a claim was lodged before the District Forum, for the recovery of a sum of Rs.2 lakhs, being the amount payable under three policies, as well for the recovery of a sum of Rs.10000/-, for mental agony.
6. The 1st opposite party admitting the policies, giving the details of the policies also, in the written version, opposed the claim, on the grounds with among other grounds, that the life assured has authorized the 2nd opposite party to deduct the premium, from his salary, giving an undertaking letter, if the employer failed to pay the amount, he will take the entire responsibility for any consequences, on account of non-payment of premium, on his policies, for reasons beyond control, that in this case, premium has not been recovered and paid for several months, that as per the certificate issued by the 2nd opposite party, there was no earnings for the complainant during the month of February, March, June, July, August, September, November 2001, and no recovery could be made consequentially no remittance was also followed, that the life assured also failed independently, to pay the premium, that when a claim was made on the basis of the accident, particulars were called for, such as postmortem certificate, FIR etc., which will not produced by the claimants, and therefore this opposite party had no opportunity to process the claim, which cannot be termed as deficiency in service, and that the complainants are not entitled to claim the assured amount, on the basis of the lapsed policy, for the non-payment of premium, thereby prayed for the dismissal of the complaint, denying other averments also.
7. The 2nd opposite party, in its written version, admitting the policies and their undertaking to pay the premium, by deducting the amount from the salary, would contend, that the employee has not earned salary for the month of February, March, June, July, August, September and November 2001, sufficiently, and therefore no premium was deducted, remitted, and that as per the undertaking letter, he ought to have paid the premium, which he failed, that the deduction would be reflected in the salary slips, which are issued periodically, and seeing the same also, the assured should have paid the premium, which he failed, that as per the letter of authority given by the employee, the employer is absolved from any deficiency, thereby praying for the dismissal of the complaint, since they are not responsible for the payment of the assured amount.
8. During the pendency of the case, in view of the fact that the 2nd opposite party become sick industry, resulting BIFR proceedings were initiated, and as per the memo filed, the 2nd opposite party was exonerated, by the order dt.1.9.2003, not challenged by the 1st opposite party also.
9. The District Forum, by its order dt.13.12.2005, has come to the conclusion, that the 2nd opposite arty had acted as the agent of the 1st opposite party, and the failure on their part if any, in not deducting the salary, will not deprive the right of the assured, or his nominee, and in this view, the LIC is answerable for the claim. Thus concluding, further drawing an inference, the non-payment of the amount, under the policies should be construed as deficiency in service, issued a direction against the 1st opposite party to pay the complainants Rs.2 lakhs, as per the terms of 3 policies, with subsequent interest @9% p.a., till payment, alongwith compensation of Rs.5000/- with cost of Rs.2000/-, which is impugned by the 1st opposite party, as appellant before us.
10. Thiru Vellingiri, had taken three policies, under the salary saving scheme, are admitted fact, and the details of policies are as under:
Sl.No. Policy No. Policy date Amount payable Sum Assured
1. 761076209 13.8.94 97.00 Rs.1,00,000/-
2. 761147883 28.9.99 149.00 Rs.25,000/-
3. 762069092 28.2.01 150.00 Rs.25000/-
11. The last two policies also cover, accidental benefit, not in dispute.
Based upon the understanding between the opposite parties, premium for the above said policies were deducted from the salary of Vellingiri, and remitted with the 1st opposite party, for some period, as reported by the employer, and as particulars obtained by the 1st opposite party, no premium was deducted from the salary of Vellingiri, for the month of February, March, June, July August, September, and November 2001, on the ground non earnings or insufficient earnings.
Thus it also can be taken, as an admitted, premium were not collected and paid by the employer viz.
2nd opposite party, thereby, according to the 1st opposite party, allowing the policies to lapse.
12. Unfortunately, the assured died on 29.11.2001, in a motor accident, at Ganesapuram, Sirumugai (vide para 6 of the complaint). The 1st complainant, being the nominee, and the complainants being the legal heirs of Vellingiri, claimed the assured amounts, including accident benefit, for which certain particulars were sought for by the 1st opposite party, which were not furnished, therefore, there was no process of the claim, in its real sense, which followed non-payment, the sum assured also to the beneficiary under the policies. Thus aggrieved, though the complainants failed to produce the documents required by the insurance company, issued notice, claiming the amount, and the result was not positive, in the sense, honouring by paying, thereby the case landed before the District Forum, Coimbatore.
13. The learned counsel for the appellant, would contend that the principle enunciated by the Apex Court, in Delhi Electricity Supply undertaking Vs. Basanti Devi and another, reported in AIR (2000) Supreme Court page 43, is not applicable to the present case, which was improperly applied, without considering the facts and circumstances of the case, and therefore the order of the District Forum, is liable to be set aside. It is the further submission of the learned counsel for appellant, that the assured had noticed, about the non-payment of the premium, by deducting from his salary, because of the receipt of pay slip, and in this view, when he had no earnings, he ought to have personally, paid the premium, as per the authorization letter, which he failed, not properly assessed by the District Forum, resulting erroneous conclusion. A further submission was made, that in order to prove that the assured died in a road accident, or motor accident, as the case may be, no document has been produced, which was not properly considered by the District Forum.
On the above basis, an attempt was made to upset the findings of the District Forum, which are resisted by the learned counsel for the complainant/ respondent, supporting the findings of the District Forum.
14. By going through the pleadings, admitted deduction of the premium, as well as subsequent non-deduction of the premium, from the salary and the settled proposition of law, we are unable to convince ourselves, to concede the submission made by the learned counsel for the appellant.
15. The 2nd opposite party, though have stated in the written version, that they were unable to deduct and remit the premium, for the months referred, because of the non-earning of the employer, or insufficient earning, we are not furnished with particulars, how a permanent employee, has not earned any amount, for the months February, March, June, July August, September, and November 2001. Therefore, on the basis of the written version alone, which is not supported by the materials, we are unable to say that the 2nd opposite party was unable to deduct the premium, beyond their control. Assuming, that the assured had not earned, earnings not sufficient for the purpose of deduction and remittance towards policy, the assured should have been informed by the employer, about the non-deduction or non-remittance of the premium, towards the policies, thereby compelling him to pay from his pocket, the premium as agreed, under the authorization letter also. In this case, it is not the case of the 2nd opposite party, that notice was given, or information was given to the assured, to pay the premium, since it was beyond their control, to deduct the premium, in the absence of earnings, for the above said months. In this context alone, the learned counsel for the appellant submitted, that the payment slip itself is notice for non-deduction of the premium, which we are unable to agree, since we do not have all the pay slips of Mr. Vellingiri, informing the non-deduction of the premium, from his salary. The fact, that the complainant has pleaded in the complaint, that they will come to know about the deduction for the premium, from the salary slip, will not relive the duty of the 1st opposite party, to inform the non-deduction of the premium, as held by the Apex Court, or non-issuance of notice by the LIC also, in the Basanti Dvi case, which is followed by the National Commission in LIC of India Vs. Smt. Gousabi, 2009 CTJ 402 (CP) (NCDRC).
16. In the case involved in the above decision also, insurance coverage was given for Truck Boy, under the Salary Saving Scheme, therein the employer has given an authorization letter, to deduct premium amount from the salary, every month, and deposited the same with the LIC of India, But the Truck Boy, who died later, proceeded on level without pay, resulting non-remittance by the employer. His wife claimed, the policy benefit, repudiated, since LIC has not received premium instalments, from his employer and consequentially, the policy lapsed. In that case, the District Forum dismissed the complaint, when challenged, allowed by the State Commission, which was challenged before National Commission, unsuccessfully, wherein it is held As per the terms of the scheme the employer was duty bound to have informed the petitioner about the non-payment of the premium amount because the deceased had gone on leave without pay- only then the deceased could have been held responsible for the consequence of non-payment of the premium, at no stage of deceased came to know the premium was not paid- employer being an agent of the petitioner, the petitioner held liable to pay the insured amount. Here also, the employer has not issued any notice to the assured viz. Velliangiri, asking him to pay the premium directly, and therefore he had no opportunity, during his lifetime to pay the premium.
We do not find any difficulty in applying the above principle, which is based upon the ruling in Basanthi Devi, case.
The District Forum, considering the law properly, fitting the same with the facts, has correctly came to the conclusion, that the non-payment of the sum assured under the policies, should be construed as deficiency, in which finding we concur.
17. The submission of the learned counsel for the appellant, that the accident is not made out, and therefore the nominee or the legal heirs of the assured, are not entitled to the accidental benefit, is also not appealable to us. It is not always mandatory, if any person dies in a motor accident, that there should be FIR, postmortem etc. If the accident relates to offence, punishable under the law, then only question of registering FIR, postmortem, following filing of final report, would arise. On the other hand for example, if a person, who drive a vehicle, hits a tree, met with an accident, dies, no offence has been made out, for which we cannot expect FIR or postmortem, if nothing is doubted, or any offence is contemplated.
In this way alone, it appears, Mr.Veliangiri died in motor accident, not involving in any offence, and accordingly alone, death register also had taken place. When a claim was made, it was not the case of the 1st opposite party, that Velliangiri not die in a motor accident, or met with natural death, or something like that. In fact we are unable to find any specific denial also, questioning the motor accident, which is proved by the affidavit of the relatives. No investigation also appears to have been conducted by the 1st opposite party, so as to say, that the Velliangiri, should not have been died, due to accident. Thus on the basis of the two policies, which covers the accident also, the complainants are entitled to double benefits, as correctly directed by the District Forum, which also deserves, only confirmation. For the above said reasons, the appeal is not meritorious, and is liable to be dismissed.
18. In the result, the appeal is dismissed, confirming the order of the District Forum in CC.No.149/2002 dt. 13.12.2005.
Considering the facts and circumstances of the case, there will be no order as to cost in this appeal.
S.SAMBANDAM M. THANIKACHALAM MEMBER II PRESIDENT INDEX : YES / NO Rsh/d/mtj/FB/ insurance