State Consumer Disputes Redressal Commission
Life Insurance Corporation Of India vs Mrs Anagha Anil Nibandhe on 10 December, 2012
STATE CONSUMER DISPUTES REDRESSAL COMMISSION STATE CONSUMER DISPUTES REDRESSAL COMMISSION MAHARASHTRA STATE, CIRCUIT BENCH, NAGPUR 5th Floor, Administrative Building, Civil Lines, Nagpur-01 Appeal No. A/01/588 (Arising out of Order dtd. 01.03.2011 in Complaint No. CC/00/246 of District Forum, Akola) Life Insurance Corporation of India 2nd Floor, Carrier Agent Branch Code No.990 Through Zonal Manager Western Zonal Office Life Insurance Corporation of India Yogakshem, III Floor, East Wing J B Marg, Mumbai- 400 021 ..Appellant(s) Versus 1. Mrs Anagha Anil Nibandhe R/o Akola, Dist. Akola 2. Oriental Bank of Commerce Lal Imli Chowk, Gandhbaugh Nagpur. ..Respondent(s) BEFORE: Honble Mr S. M. Shembole, Presiding Member Hon'ble Smt.Jayshree Yengal, Member PRESENT: Adv. Smt S Deshpande ..for the Appellant None .....for the Respondent JUDGEMENT
(Passed on 10.12.2012) Per Mr S M Shembole, Honble Presiding Member This appeal is directed against the judgement & order dtd.01.032011 passed by District Consumer Forum, Akola in Consumer Complaint No.CC/00/246 allowing the complaint directing the appellant / o.p. No.1 LIC to pay insurance claim amount of `1.00 Lac to the complainant / respondent No.1 Smt Anagha with interest @ 18% p.a. and further directing O.p.No.2 / respondent No.2 Oriental Bank of Commerce to pay compensation of `15,000/- with interest @ 18% p.a. Further o.ps. No.1 & 2 are directed to pay `250 each to the complainant as cost of proceedings.
(For the sake of brevity appellant hereinafter is referred as LIC and respondent No.1 as the complainant and respondent No.2 Oriental Bank of Commerce as the Bank.) Brief facts giving rise to this appeal are that:-
1.
Deceased Anil who was the husband of complainant Smt Anagha, was in service of the Bank at Nagpur.
He died on 08.08.1998. LIC had launched Salary Saving Scheme Policy and the same was obtained by the deceased Anil through his employer Bank.
2. On 28.03.1989 deceased Anil had obtained the policy of Rs.1.00 Lac namely New Money Back Plan with Profits and had given his consent to his employer Bank for payment of amount of premium to the LIC through his monthly salary. Accordingly, the Bank used to deduct the amount of premium from his monthly salary. Deceased Anil also had received an amount of `15,000/- as survival benefit in the year 1994.
3. After the death of Anil his widow complainant Anagha mad insurance claim. However, LIC repudiated the same on the ground that the policy was lapsed as the amount of premiums was not paid, etc. Therefore, the complainant made Consumer Complaint claiming amount of insurance & compensation, totaling to `1.25 Lac.
4. The complaint was resisted by the LIC vide its Written Version, contending inter alia that the Consumer Complaint is not maintainable as the complainant is not its consumer, etc. It is further contended that the policy was already lapsed as the amount of premiums was not paid by the deceased as well as his employer Bank for the period from March 1995 to March 1996 and Dec. 1996 to March 1997 and May 1997 to Aug. 1998, etc. However, it is submitted that the complainant is entitled to get paid up value i.e. `46,000/- inclusive of bonus. The o.p. LIC has denied all the other adverse allegations and submitted to dismiss the complaint.
5. In spite of due service of notice to the Bank, it failed to appear and resist the complaint. Therefore, complaint came to be proceeded exparte against it.
6. On hearing Ld. Counsel for both the sides and considering the documents on record the Forum allowed the complaint, holding that LIC as well as the Bank committed deficiency in service and therefore, the LIC is liable to pay the amount of policy `1.00 Lac with bonus, etc and the Bank is liable for payment of cost, etc.
7. Feeling aggrieved by the said judgement & order, LIC has preferred this appeal.
8. We heard Smt S Deshpande, Ld. Counsel for LIC, perused the copy of impugned judgement & order, copies of complaint and Written Version of LIC and also copy of policy. However, we have had no opportunity to hear the complainant as well as Bank, as they remained absent and the appeal is proceeded exparte against them.
9. Smt S Deshpande, Ld. Counsel for LIC submitted that since LIC has not received the amount of premium either from the deceased Anil or from his employer Bank, the policy was lapsed and therefore, the complainant who is the widow of insured is not entitled to claim the amount of policy, etc. However, she has fairly conceded that under the Salary Saving Scheme Policy, the Bank had undertaken its responsibility to deduct the amount of premium from the monthly salary of the employee policy holder Anil and remit the same to LIC.
But the Bank failed to remit the amount of premium for the period from March 1995 to March 1996 and Dec. 1996 to March 1997 and May 1997 to Aug. 1998 and therefore, the policy was lapsed.
10. It is further submitted that the policy was not revived neither by the policy holder nor his employer by paying the due amount, etc. It is true that neither policy holder nor his employer had taken any step for revival of the policy. But when the Bank had undertaken to deduct the amount of premium from the monthly salary of deceased Anil and remit the same to LIC, it was for the o.p. employer Bank only to pay the amount of premium regularly. It was not the fault on the part of policy holder. Even it is not known whether the Bank deducted the amount of premium from the monthly salary of the deceased Anil for the aforesaid period.
However, since the Bank had already undertaken to do so and further it has deducted the amount of premium for the subsequent period till the month of April and remitted the same to the account of LIC, it can be safely infer that the Bank has regularly deducted monthly premium from the monthly salary of policy holder deceased Anil. But the some amount of premiums for the aforesaid period i.e. from March 1995 to March 1996 and Dec. 1996 to March 1997 and May 1997 to Aug. 1998 was not remitted to LIC. When the Bank was acting as an agent of the policy holder, it was necessary for the LIC to recover the dues from the Bank by issuing notice and further it was necessary to inform the policy holder also. Therefore, the policy holder or his successor cannot be deprived from their rights to get the amount of policy. It should be noted as observed by the Honble Apex court in the case of Delhi Electric Supply Undertaking Vs. Basanti Devi & Anr. reported in 1999 (3) CPR 91 (SC), that Employer had taken undertaking to deduct the amount of premium from the monthly salary of employee policy holder and remit the same to LIC, thereafter the employee was not aware about the fact that the employer was not acting as his agent the LIC is liable to pay amount of policy As stated earlier in this case also there is no evidence on record to show that the policy holder deceased Anil employee of the Bank was made aware that his employer is not acting as his agent by deducting the amount of premium from his salary and remitting the same to the LIC. Therefore, though the policy was lapsed, the widow of the policy holder cannot be deprived from claiming the amount of policy from the LIC.
11. Further it is submitted by Adv. Smt S Deshpande for the appellant that the complainant is entitled to receive only the amount to the extent of paid up value `46,000/- inclusive of bonus and out of that the complainant has already received `15,000/- towards survival benefit during the life time of insured Anil. But since it was the fault on the part of LIC and the Bank, the submission made by Adv. Smt Deshpande, cannot be accepted.
12. For the foregoing reasons the Forum has rightly held that the LIC is liable to pay the amount of policy to the complainant with interest and Bank for compensation and awarded reasonable compensation.
13. However, in our view, the Forum has committed error in awarding interest @ 18% p.a., which is not reasonable. Considering the peculiar facts of the case, in our view, 9% rate of interest would be reasonable and therefore, we feel it just & proper to reduce the rate of interest awarded by the Forum to 9%.
14. For the foregoing reasons, the appeal deserves to be partly allowed.
Hence, the following order:-
ORDER i. Appeal is partly allowed and the impugned order is modified as under:-
a.
Appellant
- LIC shall pay to the complainant amount of policy `1.00 Lac with interest @ 9% p.a. w.e.f. the date of impugned order i.e. 01.03.2001.
b.
Respondent No.2 - the Bank shall pay to the complainant compensation `15,000/- with interest @ 9% p.a. w.e.f. 01.03.2001.
c. Impugned order pertaining to the amount of cost is maintained.
ii. Appellant
- LIC shall bear its own cost.
iii. Copy of this order be supplied to the parties.
[ S. M. SHEMBOLE ] PRESIDING MEMBER [ SMT.JAYSHREE YENGAL] MEMBER sj