State Consumer Disputes Redressal Commission
Life Insurance Corp. Of India vs Nanda Panwar & Another on 16 August, 2017
STATE CONSUMER DISPUTES REDRESSAL COMMISSION UTTARAKHAND
DEHRADUN
FIRST APPEAL NO. 150 / 2012
Smt. Nanda Panwar W/o late Sh. Ratan Singh Panwar
R/o Village & Post Office Badkot, Satiyalidhar
Patti Gaajna, District Uttarkashi
......Appellant / Complainant
Versus
1. Life Insurance Corporation of India
Uttarkashi through its Branch Manager
2. Executive Engineer, Irrigation Division
Gyansu, Uttarkashi
......Respondents / Opposite Parties
Sh. M.N. Mishra, Learned Counsel for the Appellant
Sh. Deepak Ahluwalia, Learned Counsel for Respondent No. 1
None for Respondent No. 2
AND
FIRST APPEAL NO. 158 / 2012
Life Insurance Corporation of India
Uttarkashi through its Branch Manager
Life Insurance Corporation of India, Uttarkashi
......Appellant / Opposite Party No. 1
Versus
1. Smt. Nanda Panwar W/o late Sh. Ratan Singh Panwar
R/o Village & Post Office Badkot, Satiyalidhar
Patti Gaajna, District Uttarkashi
......Respondent No. 1 / Complainant
2. Executive Engineer, Irrigation Division
Gyansu, Uttarkashi
......Respondent No. 2 / Opposite Party No. 2
Sh. Deepak Ahluwalia, Learned Counsel for the Appellant
Sh. M.N. Mishra, Learned Counsel for Respondent No. 1
None for Respondent No. 2
Coram: Hon'ble Mr. Justice B.S. Verma, President
Mrs. Veena Sharma, Member
2
Dated: 16/08/2017
ORDER
(Per: Justice B.S. Verma, President):
These two appeals under Section 15 of the Consumer Protection Act, 1986 are directed against the order dated 11.09.2012 passed by the District Forum, Uttarkashi in consumer complaint No. 54 of 2010.
2. Briefly stated the facts giving rise to the appeal are that late Sh. Ratan Singh Panwar, the deceased husband of the complainant - Smt. Nanda Panwar, was a Class - IV employee in Irrigation Division, Gyansu, Uttarkashi and during his lifetime, he had taken a life insurance policy No. 271447890 from Life Insurance Corporation of India under Salary Saving Scheme. The policy was named as Jeevan Saral (with profits). The policy was for the period from 28.03.2009 to 28.03.2029. The said policy contained assured sum of Rs. 2,50,000/- together with accidental benefit of Rs. 2,50,000/-. At the time of taking the policy, the life assured had paid two premium installments and the remaining premium installments were to be paid by his employer under the relevant scheme. The complainant was the nominee under the said policy. Unfortunately, the life assured died in a road accident on 08.07.2009. The complainant lodged the claim with the insurance company. The insurance company vide their letter dated 19.01.2010 informed the complainant that sum of Rs. 2,042/- was deposited on 08.07.2009, after the death of the life assured and for want of payment of premium for the month of May, 2009, the policy had lapsed. At the time of taking the policy, the life assured had submitted Form No. K.D. 55 with the insurance company, which was to be sent by the insurance company to the employer of the life assured (Payment Authority), so that payment of the premium could be made after deduction of the same from the salary of the life 3 assured. If the said Form has not been sent by the insurance company to the employer of the life assured (opposite party No. 2 before the District Forum), the same tantamount to deficiency in service on the part of the insurance company. Since the claim was not paid and hence alleging deficiency in service, the complainant filed a consumer complaint before the District Forum, Uttarkashi.
3. The insurance company filed written statement before the District Forum and pleaded that Form No. K.D. 55 was sent to the employer of the life assured; that on account of non-deposit of premium for the month of May, 2009, the policy had lapsed; that the life assured did not get the policy revived during his lifetime by depositing the due premium and that there is no deficiency in service on their part.
4. The opposite party No. 2 - respondent No. 2 in the present appeals also filed written statement before the District Forum and pleaded that they did not receive any Form No. K.D. 55 from the insurance company; that no deduction was made from the salary of the deceased towards the amount of premium of life insurance policy obtained by the life assured and that there is no deficiency in service on their part.
5. The District Forum after perusal of the evidence on record allowed the consumer complaint vide impugned order dated 11.09.2012 and directed the insurance company to pay the insured amount of Rs. 2,50,000/- together with accidental benefit of Rs. 2,50,000/-, in all, Rs. 5,00,000/- to the complainant within a period of one month from the date of the order. Not satisfied with the relief awarded by the District Forum per impugned order, the complainant has filed First Appeal No. 150 of 2012, thereby seeking 4 enhancement of compensation and whereas being aggrieved by the impugned order, the insurance company has filed First Appeal No. 158 of 2012, thereby assailing the legality and propriety of the impugned order. Since both the appeals arise out of the same impugned order, therefore, these are being decided together by this common order.
6. None appeared on behalf of respondent No. 2 (employer of the deceased life assured). We have heard the learned counsel for the complainant as well as insurance company and gone through the record.
7. There is no dispute with regard to the insurance of the life assured and his death in a road accident during the currency of the insurance policy. The insurance company has taken the stand that since the premium of the policy for the month of May, 2009 was not paid / deposited by the life assured and hence the insurance policy had lapsed and the same was not in force on 08.07.2009, the date of death of the life assured. Therefore, the insurance company can not be held liable to pay the amount of the insurance policy along with the accidental benefit.
8. There is also no dispute that the insurance policy in question was obtained by the life assured, who was a Class - IV employee in Irrigation Division, Gyansu, Uttarkashi under the Salary Saving Scheme and the premium for the said policy was to be deducted by his employer from his salary and was to be remitted to the insurance company. The copy of the authority letter (Form No. K.D. 55) executed by the life assured in favour of the insurance company is on record. By way of the said authority letter, the life assured had given authority for deduction of monthly premium of Rs. 1,021/- from his 5 salary for the period from May, 2009 to February, 2029 and remittance of the same to the insurance company and in the said Form, the life assured had also mentioned the particulars of his employer. If the said Form was not sent by the insurance company to the employer of the life assured, no fault can be attributed to the life assured for not depositing the premium of the insurance policy. After obtaining the said Form from the life assured, it was the duty and responsibility of the insurance company to send the same to the employer of the life assured, so that the employer of the life assured could also get knowledge of the policy obtained by the life assured and the monthly premium for the same could be timely remitted to the insurance company after deduction of the same from the salary of the life assured. As is stated above, the employer of the life assured has specifically pleaded in the written statement that they have never received any Form No. K.D. 55 from the insurance company. The insurance company has not filed any reply or evidence to discard the said plea taken by the employer of the life assured and to show that they have sent the said Form to the employer of the life assured, but non-deposit of the premium was fault / negligence on the part of the employer of the life assured.
9. Learned counsel for the insurance company cited a decision of the Hon'ble National Commission in the case of Life Insurance Corporation of India and another Vs. Consumer Education & Research Society and others; 1994 (1) CPR 106 (NC). In the said case, the 3rd premium for the life insurance policy became payable on 06.03.1987. The insured issued a bearer cheque dated 04.03.1987 to the agent, but the same was encashed and deposited on 10.08.1987. The insured died on 09.08.1987. The claim was repudiated by the insurance company on the ground that policy had lapsed due to non-payment of premium even in 3 months' grace period. It was held 6 that the insurance company was not liable to pay any amount. The said decision does not apply to the facts and circumstances of the present case and does not provide any help to the insurance company, for the reason that in the instant case, the life assured had duly signed and executed Form No. K.D. 55 during his lifetime and the same was handed over to the insurance company, but the insurance company failed to send the same to the employer of the life assured, which resulted in non-deposit of the premium and ultimately, the policy got lapsed. There was no inaction or negligence on the part of the life assured in non-deposit of the premium of the policy.
10. In view of above, we are of the considered view that the insurance company was not at all justified in repudiating the claim of the complainant and the insurance company has certainly committed deficiency in service by denying the genuine and legitimate claim of the complainant and the view to that effect taken by the District Forum does not suffer from any illegality and the appeal filed by the insurance company bearing First Appeal No. 158 of 2012 being bereft of any merit, is liable to be dismissed.
11. So far as the appeal filed by the complainant for enhancement bearing First Appeal No. 150 of 2012 is concerned, we find force in the same, for the simple reason that there has certainly been deficiency in service on the part of the insurance company in the instant matter and the complainant has been unnecessarily made to run to the Consumer Forum and the District Forum has merely granted the assured sum under the policy along with accidental benefit to the complainant. Thus, in our opinion, the complainant is also entitled to interest @7% p.a. on sum of Rs. 5,00,000/- awarded by the District Forum w.e.f. 12.10.2010, the date of filing of the consumer complaint till payment. This way, the said appeal is fit to be allowed.
712. For the reasons aforesaid, First Appeal No. 150 of 2012 filed by the complainant is allowed and the order impugned dated 11.09.2012 passed by the District Forum is modified and the insurance company is directed to pay compensation of Rs. 5,00,000/-, as awarded by the District Forum per impugned order, to the complainant together with interest @7% p.a. from 12.10.2010, the date of filing of the consumer complaint till payment. First Appeal No. 158 of 2012 filed by the insurance company is dismissed. Costs of the appeals made easy.
13. Let the copy of the order be kept on the record of First Appeal No. 158 of 2012.
(MRS. VEENA SHARMA) (JUSTICE B.S. VERMA) K