State Consumer Disputes Redressal Commission
Div. Manager, Life Insurance ... vs Master Ayush. & Anr. on 5 March, 2019
H. P. STATE CONSUMER DISPUTES REDRESSAL
COMMISSION SHIMLA
First Appeal No. : 174/2017
Date of Presentation: 17.06.2017
Order Reserved on : 31.10.2018
Date of Order : 05.03.2019
......
1. Divisional Manager Life Insurance Corporation Kasumpti
Shimla.
2. Branch Manager Life Insurance Corporation The Mall
Shimla.
3. Jagdish Singh Parmar C/o. Life Insurance Corporation of
India The Mall Shimla-1.
...... Appellants/Opposite Parties
Versus
1. Master Ayush son of late Shri Ajeet Ranta through next
friend natural guardian and mother Smt. Sarita Ranta
Wd/o. late Sh. Ajeet Ranta R/o. Maheshwar Niwas Lower
Cemetery Sanjauli Shimla-6.
2. Smt. Sarita Ranta Wd/o. late Shri Ajeet Ranta R/o.
Maheshwar Niwas Lower Cemetery Sanjauli Shimla-6.
......Respondents/Complainants
Coram
Hon'ble Justice P.S. Rana (R) President
Hon'ble Mr. Vijay Pal Khachi Member
Whether approved for reporting?1 Yes.
For Appellant s : Mr. Narender Sharma Advocate.
For Respondents : Mr. Sunil Chauhan Advocate.
JUSTICE P.S. RANA (R) PRESIDENT:
O R D E R :-
1. Present appeal is filed under section 15 of Consumer Protection Act 1986 against order dated 1 Whether reporters of the local papers may be allowed to see the order? Yes. Div. Manager Life Insurance Corporation & Ors. Versus Master Ayush & Anr. F.A. No.174/2017 08.05.2017 passed by Learned District Forum in consumer complaint No.77/2012 titled Master Ayush & Anr. Versus The Divisional Manager Life Insurance Corporation & Ors. Brief facts of consumer complaint:
2. Minor Ayush and widow Smt. Sarita Ranta filed consumer complaint under section 12 of Consumer Protection Act 1986 pleaded therein that authorised person of Life Insurance Corporation received two premiums amounting to Rs.1067/- at the time of filling of proposal form from deceased Ajeet Ranta on dated 06.05.2009. It is pleaded that deceased Ajeet Ranta died on dated 09.05.2009. It is pleaded that Insurance policy was made operative w.e.f. 28.05.2009. It is pleaded that after the death of Ajeet Ranta life insurance claim was submitted before opposite parties but opposite parties repudiated the claim and committed deficiency in service. Complainants sought entire benefits of Insurance policy No.154603582. In addition complainants sought damage to the tune of Rs.50000/-(Fifty thousand) for mental torture and harassment. In addition complainants sought litigation costs to the tune of Rs.10000/-(Ten thousand).
3. Per contra version filed on behalf of opposite parties No.1 & 2 pleaded therein that present consumer complaint is not maintainable against opposite parties No.1 &
2. It is pleaded that insured had died on dated 09.05.2009 2 Div. Manager Life Insurance Corporation & Ors. Versus Master Ayush & Anr. F.A. No.174/2017
and present consumer complaint was filed in the month of March 2012 and same is barred under Consumer Protection Act 1986. It is pleaded that no cause of action accrued to the complainants against opposite parties No.1 & 2. It is pleaded that insured died on 09.05.2009 before the commencement of Insurance policy and Insurance company is not under legal obligation to pay any Insurance amount. It is pleaded that Insurance policy was commenced w.e.f. 28.05.2009. It is pleaded that opposite parties No.1 & 2 did not commit any deficiency in service. Prayer for dismissal of consumer complaint sought.
4. Per contra separate version filed on behalf of opposite party No.3 pleaded therein that deceased Ajeet Ranta was employed in HRTC. It is pleaded that Ajeet Ranta filled and signed proposal form. It is pleaded that Komal Jeewan Policy was adopted and as per condition of policy risk of child starts from seven years of age or from two years from the date of commencement of policy whichever is later. It is pleaded that age of child namely Master Ayush was less than seven years and deceased insured died prior to two years from the date of commencement of Insurance policy. It is further pleaded that minor is not entitled for any benefit. Prayer for dismissal of consumer complaint sought.
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5. Complainants filed rejoinder and reasserted the allegations mentioned in the complaint. Learned District Forum directed opposite parties jointly and severally to give all benefits accruing to complainant No.1 under Insurance policy No.154603582 through his mother complainant No.2 within forty five days from date of receiving the copy of order. Learned District Forum further ordered that opposite parties would also pay damage to the tune of Rs.10000/-(Ten thousand) on account of mental agony and harassment. Learned District Forum further ordered that opposite parties jointly and severally would also pay litigation costs to the tune of Rs.5000/-(Five thousand). Feeling aggrieved against order passed by Learned District Forum opposite parties filed present appeal before State Commission.
6. We have heard learned Advocates appearing on behalf of parties and we have also perused entire record carefully.
7. Following points arise for determination in present appeal.
1. Whether appeal filed by appellants is liable to be accepted as mentioned in memorandum of grounds of appeal?
2. Final order.
Findings upon point No.1 with reasons:
8. Complainants filed affidavit of Smt. Sarita Ranta widow of Ajeet Ranta deceased. There is recital in affidavit 4 Div. Manager Life Insurance Corporation & Ors. Versus Master Ayush & Anr. F.A. No.174/2017
that late Sh. Ajeet Ranta was approached by authorised agent of Life Insurance Corporation and proposal form was filled and signed and premium amounting to Rs.1067/-(One thousand sixty seven) was paid. There is recital in affidavit that complainant No.1 was nominee in Insurance policy. There is recital in affidavit that insured had died on 09.05.2009 and claim was submitted before opposite parties. There is recital in affidavit that Life Insurance Corporation repudiated the claim and committed deficiency in service. State Commission has perused all the annexures filed by complainants carefully.
9. Opposite parties No.1 & 2 filed affidavit of Shri N.R. Sharma Manager Life Insurance Corporation of India. There is recital in affidavit that life insured had died on 09.05.2009 and premium of Insurance policy was received in the office of opposite parties on 28.05.2009. There is recital in affidavit that Insurance policy was not in operation at the time of death of life insured and present consumer complaint is not maintainable. There is recital in affidavit that present consumer complaint is barred because life insured had died on 09.05.2009 and present consumer complaint was filed in the month of March 2012. There is recital in affidavit that policy No.154603582 was issued in the name of life insured after receiving premium on dated 28.05.2009 by concerned 5 Div. Manager Life Insurance Corporation & Ors. Versus Master Ayush & Anr. F.A. No.174/2017 Insurance company. There is recital in affidavit that opposite parties No.1 & 2 did not commit any deficiency in service.
10. Submission of learned Advocate appearing on behalf of appellants that order of learned District Forum that opposite parties would jointly and severally pay all benefits accruing to complainant No.1 in Insurance policy No.154603582 is contrary to law and contrary to proved facts is decided accordingly. It is proved on record that proposal form was filled and signed by deceased Ajeet Ranta on 06.05.2009 through agent of Life Insurance Corporation namely Jagdish Singh. Admittedly Jagdish Singh is agent of opposite parties No.1 & 2 i.e. Life Insurance Corporation and he has also mentioned in the proposal form his licence number. Nominee in the proposal form has been mentioned as Master Ayush Ranta son and Smt. Sarita Ranta widow of deceased. Smt. Sarita has filed affidavit that agent of opposite parties No.1 & 2 namely Jagdish Singh has received two premiums to the tune of Rs.1067/-(One thousand sixty seven) relating to Insurance policy on dated 06.05.2009. Affidavit filed by Smt. Sarita Ranta remained unrebutted on record. Shri Jagdish Singh authorised agent of Life Insurance Corporation did not file his personal counter affidavit. Hence adverse inference is drawn against Life Insurance Corporation 6 Div. Manager Life Insurance Corporation & Ors. Versus Master Ayush & Anr. F.A. No.174/2017 for non filing counter affidavit of Shri Jagdish Singh authorised agent of Life Insurance Corporation.
11. It is proved on record that as per status report of Insurance policy placed on record Insurance policy was commenced w.e.f. 28.05.2009. It is also proved on record that insured Ajeet Ranta died on 09.05.2009 prior to commencement of Insurance policy. It is well settled law that Insurance policy is bilateral agreement between insurer and insured and governed under Indian Contract Act 1872. As per section 3 of Indian Contract Act 1872 Insurance contract is completed when offer is accepted by insurer. See AIR 1966 SC 543 titled Bhagwan Dass Goverdhan Dass Kedia Versus Girdhari Lal & Company. In the present matter proposal was accepted by opposite parties No.1 & 2 on dated 28.05.2009.
12. State Commission has also carefully perused proposal form annerxure-A1 received by Jagdish Singh who is licensed authorised agent of Life Insurance Corporation. There is positive condition at S.No.14 of proposal form that in case deceased died prior to commencement of Insurance policy then premium relinquish benefits would be obtained by legal representatives of deceased. State Commission is of the opinion that condition mentioned at S.No.14 of proposal form is binding upon Life Insurance Corporation and Life Insurance Corporation could not be allowed to approbate and 7 Div. Manager Life Insurance Corporation & Ors. Versus Master Ayush & Anr. F.A. No.174/2017 reprobate at the same time because Life Insurance Corporation has received two premiums to the tune of Rs.1067/-(One thousand sixty seven) from insured through their authorised agent and LRs of deceased are legally entitled for benefits of two premiums relinquishment benefits under Insurance policy form. State Commission is of the opinion that LRs of deceased are not legally entitled for other benefits of Insurance policy because deceased had died prior to commencement of Insurance policy and prior to acceptance of Insurance policy on behalf of Life Insurance Corporation.
13. Submission of learned Advocate appearing on behalf of appellants that complainants are not entitled for mental agony compensation to the tune of Rs.10000/-(Ten thousand) and on this ground appeal filed by appellants be allowed is decided accordingly. There is no evidence on record in order to prove that Life Insurance Corporation has given two premiums relinquishment benefits to complainants as of today. No reasons assigned by Insurance Corporation as to why Insurance Corporation has not given benefits of two premiums relinquishment benefits to complainants till date as per terms and conditions of proposal form as per receipt of two premiums through its agent. Hence it is held that order of learned District Forum relating to damage does not warrant interference by State Commission.
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14. Submission of learned Advocate appearing on behalf of appellants that order of learned District Forum relating to litigation costs to the tune of Rs.5000/-(Five thousand) warrants interference by State Commission is decided accordingly. It is proved on record that opposite parties No.1 & 2 did not pay two premiums relinquishment benefits to the complainants till date and complainants were forced to approach learned District Forum and complainants have engaged Advocate and have paid Advocate fee and have also incurred other litigation expenses. Hence it is held that order of learned District Forum relating to litigation costs does not warrant any interference by State Commission.
15. Submission of learned Advocate appearing on behalf of appellants that consumer complaint is not within limitation and on this ground appeal filed by appellants be allowed is decided accordingly. It is held that cause of action accrued to complainants after issuance of repudiation letter by Life Insurance Corporation. In the repudiation letter date has not been mentioned by Insurance Corporation. It is held that Life Insurance Corporation could not be allowed to take benefit of its own wrong and laxity. It is held that plea of Insurance Company that consumer complaint was not filed within limitation from date of repudiation letter is defeated on the concept of ipse dixit (An assertion made without proof). 9
Div. Manager Life Insurance Corporation & Ors. Versus Master Ayush & Anr. F.A. No.174/2017
16. Submission of learned Advocate appearing on behalf of appellants that minor namely Master Ayush was below seven years at the time of death of insured and he is not legally entitled for benefits of two relinquishment premium amount is decided accordingly. It is held that Master Ayush is the son of deceased Ajeet Ranta and falls under class-I of legal heirs under Hindu Succession Act 1956 and he is legally entitled for the benefit of condition No.14 of proposal form relating to surrendered benefits of two premiums.
17. Submission of learned Advocate appearing on behalf of appellants that deceased Ajeet Ranta did not die within two years after commencement of policy and his LRs are not legally entitled for any two premiums relinquishment benefits and on this ground appeal filed by appellants be allowed is decided accordingly. State Commission is of the opinion that terms and conditions of proposal form are binding upon Life Insurance Corporation and Life Insurance Corporation is under legal obligation to give two premiums surrendered benefits to LRs of deceased. It is held that terms and conditions at S.No.14 of proposal form is binding upon Life Insurance Corporation after receipt of two premiums amount through its authorised agent.
18. Submission of learned Advocate appearing on behalf of complainants that order of learned District Forum 10 Div. Manager Life Insurance Corporation & Ors. Versus Master Ayush & Anr. F.A. No.174/2017 does not warrant interference by State Commission and same be affirmed is decided accordingly. State Commission is of the opinion that insured had died prior to acceptance of Insurance policy by insurer. State Commission is of the opinion that complainants are legally entitled for two premiums surrender benefits of Insurance policy as mentioned in condition No.14 of proposal form because agent of Insurance Company has received the premium at the time of filling of proposal form to the tune of Rs.1067/-(One thousand sixty seven). It is held that filling of proposal form and payment of two premiums at the time of proposal form to agent of Insurance Corporation is only intermediate process of acceptance of Insurance policy. As per law Insurance policy is operative from the date of acceptance of Insurance policy by insurer because as per section 3 of Indian Contract Act 1872 communication, acceptance and revocation of proposals are essential factors in bilateral contractual agreement. In the present matter there is no proposal in proposal form submitted by deceased insured that Insurance policy would be operative w.e.f. 06.05.2009. On the contrary deceased insured has given option in proposal form that Insurance policy would not be operative from any prior date. Hence option given by insured is binding upon his LRs because LRs have stepped into the shoes of deceased insured relating to insurance claim. Even in the proposal form there is specific 11 Div. Manager Life Insurance Corporation & Ors. Versus Master Ayush & Anr. F.A. No.174/2017 coloumn of back date of commencement of Insurance policy and deceased insured has mentioned 'No' in that coloumn. It is proved on record that complainants have stepped into the shoes of deceased insured and LRs of deceased insured could not take benefit of laxity of deceased insured as per law. In view of above stated facts point No.1 is decided accordingly. Point No.2: Final Order
19. In view of findings upon point No.1 above appeal filed by Life Insurance Corporation is partly allowed. Order of learned District Forum that Life Insurance Corporation would give all benefits to complainant No.1 under policy No.154603582 through his mother complainant No.2 within forty five days from the date of receiving the copy of order failing which interest @ 9% per annum shall be payable from the date of filing of complaint till payment is set aside.
20. In addition it is ordered that opposite parties No.1 to 3 jointly and severally shall pay all proportionate consequential monetary benefits of two surrendered premiums to complainants alongwith interest @ 9% per annum from the date of institution of complaint till actual payment as mentioned in condition No.14 (Fourteen) of proposal form of Insurance policy. It is held that two premiums received by authorised agent of Life Insurance Corporation on dated 06.05.2009 from deceased insured shall 12 Div. Manager Life Insurance Corporation & Ors. Versus Master Ayush & Anr. F.A. No.174/2017 be deemed to be receipt of two premiums by Life Insurance Corporation.
21. Order of learned District Forum that opposite parties would jointly and severally pay compensation to complainants for mental agony and harassment to the tune of Rs.10000/-(Ten thousand) is affirmed. Order of learned District Forum that opposite parties would jointly and severally pay litigation costs to the tune of Rs.5000/-(Five thousand) to complainants is also affirmed. Surrendered benefits of two premiums of Insurance policy would be given to complainants in equal shares. However share of minor Ayush shall be deposited in Nationalized Bank till minor attained age of majority.
22. In addition it is further ordered that Life Insurance Corporation shall also pay litigation costs to minor and widow of deceased qua litigation costs before State Commission to the tune of Rs.10000/-(Ten thousand). Proposal form and Declaration form shall form part and parcel of order. Order passed in the interest of minor and in the interest of widow of deceased in the ends of justice and on the principles of natural justice. File of learned District Forum alongwith certified copy of order be sent back forthwith and file of State Commission be consigned to record room after due completion forthwith. Certified copy of order be transmitted to 13 Div. Manager Life Insurance Corporation & Ors. Versus Master Ayush & Anr. F.A. No.174/2017 parties forthwith free of costs strictly as per rules. Appeal is disposed of. Pending application(s) if any also disposed of.
Justice P.S. Rana (R) President Vijay Pal Khachi Member 05.03.2019 KD* 14