State Consumer Disputes Redressal Commission
Subhash Chandra Gupta vs Life Insurance Corporation Of India on 16 April, 2015
STATE CONSUMER DISPUTES REDRESSAL COMMISSION UTTARAKHAND
DEHRADUN
CONSUMER COMPLAINT NO. 04 / 2013
Sh. Subhash Chandra Gupta S/o late Sh. Kapoor Chandra Gupta
R/o 2-235, Radhika Niwas, Ambika Vihar
P.O. Bhotia Parao
Haldwani, District Nainital
......Complainant
Versus
1. Life Insurance Corporation of India
Branch Office Sheeshmahal, Nainital Road
Haldwani, District Nainital
through its Branch Manager
2. Life Insurance Corporation of India
having its Head Office at P & G.S. Unit
14th Floor, Yogkshetra
J.B. Marg, Mumbai - 400021
......Opposite Parties
Sh. Yogesh Sethi, Learned Counsel for the Complainant
Sh. T.S. Bindra, Learned Counsel for Opposite Parties
Coram: Hon'ble Mr. Justice B.C. Kandpal, President
Mr. D.K. Tyagi, H.J.S., Member
Mrs. Veena Sharma, Member
Dated: 16/04/2015
ORDER
(Per: Justice B.C. Kandpal, President):
This consumer complaint under Section 12 read with Section 18 of the Consumer Protection Act, 1986 has been filed by Sh. Subhash Chandra Gupta (hereinafter referred to as "complainant") against the opposite parties - Life Insurance Corporation of India, alleging deficiency in service on their part.
2. Briefly stated, the facts of the case as mentioned in the consumer complaint, are that in the year 2005, the complainant had 2 purchased a life insurance policy from the Life Insurance Corporation of India bearing policy No. 283458589 (48-25) for assured sum of Rs. 1,00,00,000/-. The said policy carried annual premium of Rs. 4,68,880/-. The said policy was obtained by the complainant from Varanasi Divisional Office of Life Insurance Corporation of India, because at that time, the complainant was residing at Sonebhadra (Uttar Pradesh). In the year 2008, the complainant shifted his business to Haldwani and started residing most of the time at Haldwani and the intimation with regard thereto was given by the complainant to the Divisional Office of the Life Insurance Corporation of India and it was mentioned that the complainant is starting his business at Haldwani and, as such, the future correspondence with regard to the insurance policy in question be made at the Haldwani address of the complainant instead of Sonebhadra. In regard to the change of address, the Life Insurance Corporation of India demanded certain documents from the complainant, but since the complainant had recently started his business at Haldwani and hence all the documents with regard to change of address could not be provided to the insurance company. In the meantime, the health of the father of the complainant deteriorated and since the complainant was busy in establishing his new business at Haldwani and hence he could not deposit the premium of the insurance policy in time. In the year 2011, all of a sudden, the complainant's father felt severely sick and the complainant had to take his father to New Delhi for treatment. During medical examination of his father, the complainant also got himself medically examined, on which, the doctor told him that there is blockage in his heart arteries and he requires to undergo bypass surgery immediately. On 17.02.2012, the bypass surgery of the complainant was done. After his treatment, the complainant came back to Haldwani and contacted the local agent of the insurance company, who told the complainant 3 that the complainant can got his insurance policy in question revived, which had lapsed in the year 2008 for want of payment of premium. In regard to the revival of the insurance policy, the complainant was informed that the complainant has to first write a letter to the insurance company, on receipt whereof, the insurance company will sent him a quotation and thereafter on payment of the required amount, the insurance policy can be got revived. The complainant made correspondence with the insurance company in regard to the revival of the insurance policy.
3. It is further alleged that in continuation of the correspondence made by the complainant with the insurance company, the complainant was informed that he can get the insurance policy revived by payment of due amount with interest and penalty. It was further informed that as per the rules of the Corporation, the complainant has to pay the due 5 premium installments together with interest @9.5% and late fee, in all Rs. 31,00,240/- and a quotation with regard thereto was sent to the complainant. The complainant requested the insurance company not to levy late fee and reconsider the matter, on which the complainant was told that the decision in the matter is to be taken by the Central Office of the insurance company situated at Mumbai. The complainant was assured that his matter would by sympathetically reconsidered and he was directed to complete the medical formalities etc. The entire formalities regarding medical examination of the complainant and his medical examination report were completed by the Haldwani Division of the insurance company on 25.04.2013. In the meantime, the complainant was informed by the insurance company that looking into the fact that the complainant had undergone bypass surgery in 2012, the Central Office had decided to charge Rs. 13.70/- per thousand extra amount in addition to the due amount and only after receipt of the required amount, the insurance 4 policy would be revived. The complainant contacted the Divisional Office, Haldwani of the insurance company and stated that all the formalities have been completed and that there is no impediment in reviving the insurance policy in question. The complainant informed the insurance company that since he had undergone bypass surgery in 2012 and hence the extra amount can be claimed after the said period because till then, the complainant was not suffering from any heart ailment. The complainant submitted a proposal to the insurance company for reconsidering the levy of charge of Rs. 13.70/- per thousand as health extra. However, the insurance company rejected the proposal of the complainant and directed that in case of non-deposit of the required amount, the revival proceedings would be dropped. It is further alleged that the insurance company is demanding the illegal amount from the complainant for reviving the insurance policy and, as such, there is deficiency in service on the part of the insurance company. The complainant, therefore, filed the present consumer complaint (Paper Nos. 1 to 5) before this Commission on 26.06.2013, praying therein that the opposite parties be directed to revive the insurance policy in question by charging the minimum amount w.e.f. after the date of bypass surgery of the complainant instead of charging Rs. 13.70/- per thousand as health extra and the opposite parties be further directed to grant reasonable time to the complainant to deposit the said amount for revival of the insurance policy in question.
4. The opposite parties filed written statement (Paper Nos. 14 to
23), stating therein that the insurance policy in question had lapsed in April, 2008 due to non-payment of premium; that the complainant was unwell even prior to 2011; that the revival of the lapsed policy is to be made only in accordance with the norms and subject to fulfillment of all requisite formalities and requirement; that for revival 5 of the policy, in addition to the outstanding premium, late fee was also payable by the complainant; that since the complainant had suffered from ailments after the lapse of the policy, the revival could be considered subject to payment of extra charges on account of health; that the complainant was quoted an amount and he has required to give his consent for payment of the sum calculated @Rs. 13.70/- per thousand for extra health in addition to other charges; that the revival of the policy is not a matter of right; the competent authority had taken the decision of reviving the policy only subject to payment of health extra class 5 prorata; that this Commission does not have the territorial jurisdiction to entertain and try the consumer complaint; that the question of pricing is beyond the purview of the Act and that there is no deficiency in service on their part.
5. The complainant filed replication (Paper Nos. 39 to 44) against the written statement filed by the opposite parties, thereby denying the defence taken by the opposite parties in their written statement and reiterating the allegations made in the consumer complaint.
6. In evidence, the complainant has filed his affidavit (Paper Nos. 28 to 36). The complainant has also filed certain documents in his evidence (Paper Nos. 53 to 62) through list (Paper No. 52). The opposite parties have filed the affidavit of Sh. Rajesh Sharma, A.O. & L&HPF), Life Insurance Corporation of India, Divisional Office, Haridwar Road, Dehradun (Paper Nos. 64 to 78) in their evidence.
7. We have heard the learned counsel for the parties and have also gone through the record. We have also perused the written arguments filed by the learned counsel for the complainant (Paper Nos. 82 to 91) as well as the translated English copy of the written arguments filed by the learned counsel for the complainant (Paper Nos. 93 to 99) and 6 also the written arguments filed by the learned counsel for the opposite parties (Paper Nos. 100 to 105).
8. There is no dispute with regard to the fact that the complainant had obtained a life insurance policy from the Life Insurance Corporation of India policy No. 283458589 on 28.04.2005 for assured sum of Rs. 1,00,00,000/- from Life Insurance Corporation of India, Branch Office Anpara, falling under the Varanasi Division of the Life Insurance Corporation of India. There is also no dispute with regard to the fact that the said insurance policy had lapsed in April, 2008 for want of payment of premium. There is also no dispute with regard to the fact that the period during which the policy was not effective and was lying in lapsed state, the complainant felt heart problem and had undergone bypass surgery for rectification of his heart ailment.
9. The dispute between the parties is with regard to the terms and conditions of revival of the said insurance policy, for which the complainant had applied with the insurance company and in response whereof, the insurance company had submitted a quotation to the complainant for payment of the requisite amount for revival of the policy.
10. The opposite parties have first raised the objection regarding territorial jurisdiction of this Commission in the matter in issue. Section 17(2) of the Consumer Protection Act, 1986 deals with the territorial jurisdiction of the State Commission, which reads as under:
"(2) A complaint shall be instituted in a State Commission within the limits of whose jurisdiction -
(a) the opposite party or each of the opposite parties, where there are more than one, at 7 the time of the institution of the complaint, actually and voluntarily resides or carries on business or has a branch office or personally works for gain; or
(b) any of the opposite parties, where there are more than one, at the time of the institution of the complaint, actually and voluntarily resides, or carries on business or has a branch office or personally works for gain, provided that in such case either the permission of the State Commission is given or the opposite parties who do not reside or carry on business or have a branch office or personally works for gain, as the case may be, acquiesce in such institution; or
(c) the cause of action, wholly or in part, arises."
11. Learned counsel for the opposite parties - Life Insurance Corporation of India submitted that since the insurance policy in question was issued by Anpara Branch of Life Insurance Corporation of India, which falls under the Varanasi Division and the revival thereof was also sought by the complainant from Anpara Branch of Life Insurance Corporation of India and the revival quotation was also issued by the said branch and hence no cause of action had arisen in favour of the complainant at Uttarakhand, so as to file the consumer complaint before this Commission.
12. In para 5 of the consumer complaint, the complainant has specifically stated that in the year 2008, he shifted his business to Haldwani and started residing most of the time at Haldwani and the intimation with regard thereto was also given to the Divisional Office of the insurance company. In para 13 of the consumer complaint, the complainant has stated that after undergoing the bypass surgery, he 8 met the local agent of the insurance company at Haldwani for revival of the insurance policy, which was lying in lapsed condition. In para 21 of the consumer complaint, the complainant has specifically stated that the medical examination and other formalities required for revival of the insurance policy were done through Haldwani Division of the insurance company. The insurance company in their written statement, has not specifically denied the above averments made by the complainant in the consumer complaint. So far as the allegation of the complainant that the required formalities for revival of the policy were completed through the Haldwani Division is concerned, the insurance company has stated that the same is matter of record. Thus, the insurance company has not specifically denied that the required formalities for revival of the insurance policy were done through Haldwani Division of the insurance company.
13. The complainant has also impleaded "Life Insurance Corporation of India, Branch Office, Sheeshmahal, Nainital Road, Haldwani, District Nainital through its Branch Manager" as opposite party No. 1 in the consumer complaint and there is nothing in the written statement filed by the opposite parties that the opposite party No. 1 has wrongly been impleaded by the complainant just to create territorial jurisdiction of this Commission in the matter in issue.
14. Thus, in view of the above position and also in the light of Section 17(2) of the Consumer Protection Act, 1986, it can not be said that no cause of action or part thereof has arisen in favour of the complainant at Haldwani, so as to file the present consumer complaint before this Commission and we do not find any force in the plea of territorial jurisdiction raised by the opposite parties.
915. Learned counsel for the opposite parties cited a decision of the Hon'ble Apex Court in the case of Sonic Surgical Vs. National Insurance Company Limited; (2010) 1 Supreme Court Cases 135. In the said case, the insurance policy was taken at Ambala (Haryana), but the claim for compensation was made at Chandigarh contending that respondent has a branch at Chandigarh. It was held that the expression "branch office" would mean branch office where cause of action has arisen but not each and every branch office of opposite party wherever it is situated. In the instant case, as is stated above, all the formalities for revival of the insurance policy were completed through Haldwani Division of the insurance company, which the insurance company has not denied and the complainant has also impleaded "Life Insurance Corporation of India, Branch Office, Sheeshmahal, Nainital Road, Haldwani, District Nainital through its Branch Manager" as opposite party No. 1 in the consumer complaint and hence it can not be said that no cause of action has arisen in favour of the complainant at Haldwani and it can also not be held that this Commission has no territorial jurisdiction in the matter in issue. Learned counsel for the opposite parties has also cited a decision of the Hon'ble National Commission given in the case of New India Assurance Company Limited Vs. Gopal Gupta and another; [2013] 3 CPR (NC) 690, wherein it was held that location of branch office does not give territorial jurisdiction of Consumer Forum at that place. In the case in hand, as has been stated above, the formalities for revival of the insurance policy were completed by the complainant through the Haldwani Division of the insurance company and hence this Commission has territorial jurisdiction in the matter. Similar is the position with the decision of Tamil Nadu State Consumer Disputes Redressal Commission, Chennai given in the case of Srilatha Vs. ICICI Lombard General Insurance Company Limited; [2013] 1 CPR 143, also pressed into service by the learned counsel for the 10 opposite parties. Learned counsel for the opposite parties also cited a decision dated 01.04.2013 of this Commission given in First Appeal No. 180 of 2012; Life Insurance Corporation of India Vs. Sh. M.K. Goel. In the said case, the dispute pertained to repudiation of the claim submitted by the complainant to the Life Insurance Corporation of India, Divisional Office, Chandigarh and it was held that the territorial jurisdiction may lie with the District Forum, Dehradun only if the Life Insurance Corporation of India, Divisional Office, Chandigarh has a Branch Office at Dehradun and it was further held that the consumer complaint can not be filed before the District Forum, Dehradun. In the case under hand, as is stated above, the complainant has submitted the proposal for revival of the insurance policy in question through Haldwani Division of the insurance company and all the formalities were also completed through them and hence a part of cause of action for filing the consumer complaint has also arisen in favour of the complainant at Haldwani and, as such, this Commission has territorial jurisdiction to entertain the consumer complaint filed by the complainant.
16. In view of above discussion, we do not find any force in the plea of territorial jurisdiction raised by the opposite parties and the same is decided against the opposite parties and it is held that this Commission has got territorial jurisdiction to entertain and decide the consumer complaint filed by the complainant against the opposite parties.
17. So far as the revival of the insurance policy in question is concerned, learned counsel for the opposite parties - insurance company has placed reliance on the condition of the policy with regard to revival of discontinued policies (Paper No. 116), wherein it has been stated that if the policy has lapsed, it may be revived during 11 the lifetime of the life assured, but within a period of 5 years from the date of the first unpaid premium and before the date of maturity. The insurance policy in question had lapsed in April, 2008 and the complainant underwent bypass surgery on 17.02.2012 and whereafter he had applied with the insurance company for revival of the policy. In para 21 of the consumer complaint, the complainant has specifically stated that all the formalities like medical etc. for revival of the policy were completed on 25.04.2013. As is stated above, the opposite parties have replied the said paragraph stating that the same is matter of record. Even otherwise, the opposite parties have not refused to revive the policy in question taking shelter of the above condition of the policy, but the dispute between the parties is with regard to charging the amount for revival of the policy.
18. Learned counsel for the opposite parties cited a decision of this Commission given in the case of Life Insurance Corporation of India and another Vs. Suresh Kumar Pundir; I (2014) CPJ 233 (Uttar.), wherein it has been held that acceptance of premium and its retention by insurer not ipso facto render the policy revived in absence of acceptance of revival to insured. It was further held that revival of policy amounts to new contract and fresh declaration is taken at the time of revival of policy and that the insurance company can not be forced to revive policy if any abnormality is found in health of proposed life assured or any misstatement is found in proposal form. There can not be any doubt about the above legal position and there is no question of ipso facto revival of the insurance policy in the instant case, but the question is with regard to charging the amount for revival of the policy. The same is the position with the decision of the Hon'ble National Commission given in the case of Smt. Asha Garg and another Vs. LIC of India; [2009] 4 CPR (NC) 93, pressed into service by the learned counsel for the opposite parties.
1219. There is no dispute with regard to the fact that the complainant underwent bypass surgery on 17.02.2012 and there is nothing on record to suggest that much before the said date, the complainant was having any heart ailment and he had the knowledge of the said heart ailment. The insurance company has also not filed any evidence to show that prior to 17.02.2012, the date of bypass surgery of the complainant, the complainant was having any heart ailment / disease. The complainant has stated in para 10 of the consumer complaint that in the year 2011, his father fell sick all of a sudden and during his father's treatment at New Delhi, the complainant also got himself medically examined and whereupon, his heart ailment was revealed and he was advised to undergo bypass surgery, which was done on 17.02.2012. There is nothing on record that prior to his medical examination at New Delhi, the complainant was under the knowledge that he was having any such heart ailment which requires bypass surgery.
20. The complainant has submitted a proposal with the insurance company for revival of the insurance policy, in response whereof, the insurance company has issued a revival quotation. There is no dispute that the complainant has to pay the arrears of premium installment together with late fee, for which the complainant is also ready. The dispute between the parties is only with regard to charging the amount of Rs. 13.70/- per thousand as health extra by the insurance company. The complainant has stated that since he had undergone bypass surgery on 17.02.2012 and not in April, 2008, when the policy got lapsed and hence the said amount may be charged w.e.f. 17.02.2012 and not prior to that. The insurance company has stated that the said amount is also to be charged w.e.f. April, 2008, the date when the policy got lapsed.
1321. As is stated above, there is no evidence on record to show that the complainant felt heart ailment before his medical examination at New Delhi , when he had gone there in regard to his father's treatment and at that time, he came to know about his heart ailment and his bypass surgery was done on 17.02.2012. When the complainant was not having any knowledge of the said disease prior to the said date and there is nothing on record to the contrary, there does not seem to be any justification for charging the amount towards health extra w.e.f. the date the policy got lapsed and we are of the view that the amount of Rs. 13.70/- per thousand towards health extra should be charged w.e.f. 17.02.2012 and not prior to that.
22. Learned counsel for the opposite parties cited a decision of Tamil Nadu State Consumer Disputes Redressal Commission, Chennai in the case of The Regional Manager, LIC of India and another Vs. Dr. Rapheal Mary; [2004] 1 CPR 581, wherein it has been held that a lapsed policy is revived only on payment of all amounts and also on fulfilling of conditions stipulated. There also can not be any doubt about the above preposition of law and in the present case, the complainant is ready and willing to pay the legitimate amount payable by him and he has also fulfilled all other conditions required for revival of the policy.
23. Learned counsel for the opposite parties also submitted that since in the present case, there is question of pricing and hence the consumer complaint filed by the complainant is not maintainable before this Commission because the Consumer Forum has no jurisdiction to go into the question of pricing. In support of his submission, learned counsel pressed into service the following decisions:
14(a) Archana M. Kamath Vs. Canara Bank and another; (2003) 4 Supreme Court Cases 683.
(b) The Secretary, K.S.E.B. and another Vs. Yesu Adimanadar; [2009] 4 CPR 140.
(c) Maharashtra Housing and Area Development Authority and another Vs. Manoharrao Madhavrao Dange and others; [2009] 3 CPR (NC) 132.
(d) Dr. Madhu Rathour Vs. South Delhi University Teachers Co-operative Group Housing Society Ltd. through its Secretary and others; [2012] 4 CPR (NC) 385.
(e) State of Gujarat Vs. Rajesh Kumar Chimanlal Barot and another; (1996) 5 Supreme Court Cases 477.
24. In the instant case, no question of pricing is involved and hence the above cited decisions do not provide any help to the insurance company. Although the complainant has made a prayer that the opposite parties be directed to charge the minimum amount w.e.f. after the date of his bypass surgery instead of charging Rs. 13.70/- per thousand as health extra, but we are not going into the said question and it is the prerogative of the insurance company to charge the amount for revival of the insurance policy in accordance with its norms and the insurance company can not be directed to charge a specific amount for revival of the policy or any amount lesser that the amount payable by the insured for revival of the insurance policy as per the rules and norms of Life Insurance Corporation of India. But, as is stated above, in the peculiar facts and circumstances of the case, the justice demands that the insurance company should charge the amount of Rs. 13.70/- per thousand towards health extra w.e.f. 17.02.2012 and not prior to that.
1525. In view of the above discussions and findings, the consumer complaint filed by the complainant is disposed of in the terms that the opposite parties - Life Insurance Corporation of India is directed to revive the insurance policy No. 283458589 in question of the complainant by charging the arrears of unpaid installment premium together with late fee and Rs. 13.70/- per thousand towards health extra w.e.f. 17.02.2012 from the complainant, within a period of two months from the date of the order. There shall be no order as to costs.
(SMT. VEENA SHARMA) (D.K. TYAGI) (JUSTICE B.C. KANDPAL) K