State Consumer Disputes Redressal Commission
Krishna Devi vs Icici Prudential Insurance Company on 28 January, 2013
2nd Bench
STATE CONSUMER DISPUTES REDRESSAL COMMISSION, PUNJAB
SECTOR 37-A, DAKSHIN MARG, CHANDIGARH.
First Appeal No.1141 of 2008.
Date of Institution: 06.10.2008.
Date of Decision: 28.01.2013.
1. Krishna Devi widow of Sh. Kedar Nath Sharma;
2. Rajesh Sharma S/o Kedar Nath Sharma;
3. Rakesh Kumar S/o Kedar Nath Sharma;
4. Parveen Kumar S/o Kedar Nath Sharma;
5. Pardeep Kumar S/o Kedar Nath Sharma;
All residents of village Badrukhan, Tehsil and District Sangrur.
.....Appellants.
Versus
1. ICICI Prudential Insurance Company through its Manager, BLDG No.6,
2nd Floor, Chotti Baradari, Patiala.
2. ICICI Bank Limited, Kaula Park, Sangrur, through its Branch Manager.
...Respondents.
First Appeal against the order dated
26.06.2008 of the District Consumer
Disputes Redressal Forum, Sangrur.
Before:-
Shri Inderjit Kaushik, Presiding Member.
Shri Baldev Singh Sekhon, Member.
...................................
Present:- Sh. Aminder Singh, Advocate, counsel for the appellants.
Sh. K.S. Cheema, Advocate, counsel for respondent no.1. Sh. Munish Goel, Advocate proxy for Sh. Sandeep Suri, Advocate, counsel for respondent no.2.
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INDERJIT KAUSHIK, PRESIDING MEMBER:-
Smt. Krishna Devi and others, appellants (In short "the appellants") have filed this appeal against the order dated 26.06.2008 passed by the learned District Consumer Disputes Redressal Forum, Sangrur (in short "the District Forum").First Appeal No.1141 of 2008 2
2. Sh. Kedar Nath Sharma originally filed the complaint under section 12 of the Consumer Protection Act, 1986 (in short, "the Act") against the respondents and during the pendency of the complaint, he died and the amended head note was filed and then the complaint was filed through the appellants, being LRs.
3. Facts in brief are that deceased Kedar Nath Sharma retired as Agriculture Teacher on 31.12.2005 and obtained all his retiral benefits including gratuity, GPF, GIS, earned pay leave and pay computation etc. Deceased Kedar Nath Sharma approached respondent no.2 with the desire to deposit his hard earned money in the shape of F.D. with the bank and then Manager of respondent no.2, namely Sh. Inderpreet Singh assured the deceased that the bank will pay 12% interest p.a. on the amount. The deceased wanted to deposit his amount for the period of one year, as he was constructing his house and needed money in the next year. As per the assurances given by respondent no.2 and OP-3 (not made party in the appeal), the deceased deposited Rs.8.00 lacs with respondent no.2 at Sangrur on 01.05.2006 vide cheque no.799962. Sh. Inderpreet Singh gave calculations of interest by writing in his own hand on the plain paper in the presence of Mohinder Singh, Sarpanch and Major Singh and no receipt was issued. The deceased met OP-3, but no satisfactory reply was given.
4. The deceased reported the matter to the police and the police called respondent no.2, who delivered duplicate receipt of policy on 31.03.2007. As per the assurance of Sh. Inderpreet Singh and Sh. Vivek Sethi, the deceased deposited his hard earned money in the shape of F.D., but from the duplicate copy of the policy delivered by OP-3 on 31.03.2007, the appellant came to know that his money has been invested in the ICICI Prudential Insurance Scheme, whereas the deceased never intended to invest his amount in this policy. The respondents sent another letter dated 12.04.2007 for raising the demand of another Rs.8.00 lacs which caused a lot of mental tension, harassment to the deceased and the deceased First Appeal No.1141 of 2008 3 approached the respondents to return the amount along with interest @ 12%, as assured. A legal notice dated 30.04.2007 was served and the respondents gave reply dated 05.07.2007 and admitted their fault and offered Rs.8,21,723-25 only and the deceased accepted the offer under protest. The deceased wrote a letter dated 20.07.2007, narrating all the facts in detail and received the cheque no.569170 dated 26.07.2007 under protest as he was in need of money. The respondents paid interest to the tune of Rs.21,723-25/- only, whereas the interest calculated @ 12% p.a. comes to Rs.1.20 lacs and committed unfair trade practice.
5. It was prayed that the respondents may be directed to pay Rs.1.20 lacs along with interest @ 18% p.a. from 26.07.2007 till realization, Rs.1.00 lac as compensation and Rs.11,000/- as litigation expenses.
6. In the written reply filed on behalf of the respondent no.1 & OP- 3 (not made party in appeal), the preliminary objections were taken that the complaint has been filed with ulterior motive and with malafide intention, just to cause harassment and the complaint is frivolous. There is no contractual or other legal relationship between the deceased and respondent no.1 and OP-
3.
7. On merits, it was admitted that the respondent no.1 and OP-3 received a proposal form (also referred to as application form) signed by Kedar Nath Sharma on May 01, 2006, seeking life insurance of his life under the ICICI Pru Premier Life Policy Plan for a sum assured of Rs.8.00 lacs and chose three years premium paying term with the installments of Rs.8.00 lacs payable every year. First premium of Rs.8.00 lacs was paid by the deceased on 01.05.2006. Name of the respondent insurance company was mentioned on each and every document which makes it clear that it was a life insurance company.
8. Policy bearing no.02772566 was issued on May 03, 2006 under non-medical category at Standard (Ordinary) rates of premium and the policy certificate and terms and conditions were sent on May 05, 2006. The policy First Appeal No.1141 of 2008 4 was accompanied by a forwarding letter and the policy could be cancelled within 15 days under the free look period. In the policy, nowhere it was mentioned that the interest @ 12% will be paid. The deceased never approached respondent no.1 during the free look period, implying that he agreed to all the terms and conditions of the policy. The deceased had another policy bearing no.00793500 (Unit Linked) with respondent no.1 which shows that the deceased was very well aware that the company is life insurance and issue life insurance policies. The deceased, being an educated person, was knowing and was in a position to understand the significance of signing the proposal form and issuing the cheque in the name of ICICI Prudential Life Insurance Company Limited and he was well aware that he is investing in life insurance. As per the policy, the deceased was entitled to receive only 25% of the fund value. However, as a special case, he was offered to pay the entire fund value of Rs.8,21,723-25 and accordingly, the payment was made and the cheque was encashed by the deceased. The present complaint is the abuse of the process of the law.
9. On merits, similar pleas were repeated and denying the allegations of the complaint, it was prayed that the complaint may be dismissed with costs.
10. In the written reply filed on behalf of respondent no.2, similar preliminary objections, as taken by respondent no.1 & OP3, were repeated. On merits, it was submitted that the answering respondent has no concern with the ICICI Prudential Life Insurance Company Limited, nor any policy was issued by the answering respondent. Similar other pleas were repeated and denying allegations of the complaint, it was prayed that the complaint may be dismissed with costs.
11. Parties led evidence in support of their respective contentions by way of affidavits and documents.
12. After going through the documents and material placed on file and after hearing the learned counsel for the parties, the learned District First Appeal No.1141 of 2008 5 Forum observed that the version of the deceased has no semblance of truth. Nowhere it is mentioned that the interest @ 12% was to be paid in Ex.R-1 and Ex.R-2. The deceased received Rs.8,21,723-25 vide cheque and encashed the same on 09.08.2007, and dismissed the complaint.
13. Aggrieved by the impugned order dated 26.06.2008, the appellants have come up in appeal.
14. We have gone through the pleadings of the parties, perused the record of the learned District Forum and have heard the arguments advanced by the learned counsel for the parties as well as perused the written arguments filed on behalf of the appellants.
15. In the written arguments filed on behalf of the appellants, it was submitted that no policy documents were ever supplied till the intervention of the police, nor any free look period option was given, which amounts to deficiency in service and unfair trade practice. The deceased Kedar Nath, since deceased, invested Rs.8.00 lacs which he got as retiral benefits and he could not have gone for a policy with Rs.8.00 lacs as premium every year. The amount of Rs.8,21,723/- was accepted under protest vide application Ex.C-8. The pleas taken in the pleadings were repeated. In the absence of free look period, the right given to the deceased was taken away as he could not exercise his right and the respondent no.2 & OP-3 assured to pay interest @ 12% p.a. and to deposit amount of Rs.8.00 lacs in the F.D. It was prayed that the appeal may be accepted and the interest may be allowed.
16. On the other hand, it has been contended on behalf of the respondents that the deceased Kedar Nath Sharma took the policy and paid Rs.8.00 lacs as premium and the same was to be paid for three years and the policy along with terms and conditions was supplied, but he did not opt to cancel the policy during the free look period of 15 days. The deceased was an educated person and he had insurance policy earlier also and he signed all the documents, knowing well that the deceased was taking the policy from First Appeal No.1141 of 2008 6 respondent no.1 insurance company. The order of the District Forum is correct and the appeal may be dismissed.
17. We have considered the respective submissions advanced on behalf of the parties and minutely examined the entire record placed on the file.
18. Admittedly, the deceased Kedar Nath Sharma, who is now represented by the appellants being his LRs, retired as Agriculture Teacher and he received an amount of Rs.8.00 lacs as retiral benefits which was hard earned money of the deceased and he wanted to deposit this amount in F.D. for one year. The deceased had already retired and there is nothing on record to prove that the deceased was capable of paying Rs.8.00 lacs as premium every year. The respondent insurance company was legally bound to mention the sources of income to meet the requirement of the payment o Rs.8.00 lacs as premium per year. Respondent no.1 is guilty of unfair trade practice and instead of depositing the amount in fixed deposit receipt, put the same in the insurance policy, knowing well that the deceased will not be able to pay the premium of Rs.8.00 lacs every year. Not only the deceased, but even a person of high status or a person of higher middle class, having sufficient income also cannot think of depositing Rs.8.00 lacs as premium every year. Prima-facie, it is clear that respondent no.1 insurance company has gone to the extent of grabbing the hard earned money of a retiree and as per the policy, the fund value was only 25%, but respondent no.1 somehow or the other paid the amount of Rs.8.00 lacs with some interest, but that itself is not sufficient to exonerate respondent no.1 insurance company. The District Forum has not taken into consideration all these facts and the material fact that the premium of Rs.8.00 lacs per annum cannot be paid by even a resourceful person with legal means. If not 12%, but respondent no.1 insurance company is definitely liable to pay 9% interest per annum on the amount of Rs.8.00 lacs from the date of deposit till the payment made and First Appeal No.1141 of 2008 7 after deducting the same, the respondent insurance company is liable to pay the remaining amount as interest.
19. In view of above discussion, the appeal is accepted and the impugned order under appeal dated 26.06.2008 passed by the District Forum is set aside. Consequently, the complaint filed by the deceased Kedar Nath Sharma, now represented by the appellants, is allowed and respondents no.1 & 2 and OP-3 are liable to pay interest @ 9% p.a. on the amount of Rs.8.00 lacs from the date of deposit i.e. 01.05.2006 till 26.07.2007 when the cheque was issued and the total amount of interest comes to Rs.90,000/- and out of this, Rs.21,723-25 were paid and remaining amount comes to Rs. 68,276-75. By making round figure, we take it as Rs.68,000/-. This amount of interest is payable by the respondents no.1 & 2 and OP-3 jointly and severally to the appellants along with interest @ 7.5% from 01.08.2007 till realization. The respondents no.1 & 2 and OP-3 shall also pay Rs.10,000/- as litigation expenses to the appellants jointly and severally.
20. Compliance of the order shall be made by the respondents no.1 & 2 and OP-3 within 30 days of the receipt of copy of the order.
21. The arguments in this appeal were heard on 17.01.2013 and the order was reserved. Now the order be communicated to the parties.
22. The appeal could not be decided within the stipulated timeframe due to heavy pendency of court cases.
(Inderjit Kaushik) Presiding Member (Baldev Singh Sekhon) Member January 28, 2013.
(Gurmeet S)