Vedha Chopra vs Life Insurance Corporation Of India And ... on 30 May, 2025

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Delhi District Court

Vedha Chopra vs Life Insurance Corporation Of India And ... on 30 May, 2025

IN THE COURT OF SH. SACHIN SOOD
LD. DISTRICT JUDGE-01
CENTRAL, THC, DELHI

CS NO. 4195/2017
CNR NO. DLCT01-018627-2017

VEDHA CHOPRA
DAUGHTER OF LATE YOGESH CHOPRA
RESIDENT OF N-136, PANCHSHEEL PARK,
NEW DELHI-110017. .....PLAINTIFF

VERSUS

1. LIFE INSURANCE CORPORATION OF INDIA
THROUGH
THE BRANCH MANAGER,
BRANCH NO. 320,
LAKSHMI INSURANCE BUILDING
ASAF ALI ROAD,
NEW DELHI-110002
2. VINOD BHATIA
AUTHORIZED AGENT,
LIFE INSURANCE CORPORATION OF INDIA
F-1, NARAINA VIHAR,
NEW DELHI-110028
3. UMESH CHOPRA
SON OF LATE I.K CHOPRA
RESIDENT OF 8, SEHGAL COLONY,
COURT LANE,
CIVIL LINES,
DELHI-110054
4. SAROJ CHOPRA
WIFE OF LATE I.K CHOPRA,
RESIDENT OF 8, SEHGAL COLONY,
COURT LANE,
CIVIL LINES,
DELHI-110054
5. MANJU OBEROI
WIFE OF UPJIVE SINGH OBEROI
CS No. 4195/2017 Vedha Chopra vs. Life Insurance Corporation of India and ors Page no. 1/36
RESIDENT OF 40 C, GREEN VIEW APARTMENTS,
SECTOR 15 A
NOIDA 201301
6. DR. B.D CHOPRA
SON OF LATE K.R. CHOPRA
RESIDENT OF 25, PARKSTONE AVENUE,
HORNCHURCH,
ESSEX RM11 3LX,
ENGLAND .....DEFENDANTS

Date of Institution : 15.12.2017
Date of Judgment : 30.05.2025

JUDGMENT

1. The present suit has been filed by the plaintiff seeking recovery, declaration, permanent injunction and mandatory injunction pleading inter alia as under :-

(i) That the plaintiff was an infant aged one and half years when her father late Yogesh Chopra passed away on 28.11.1996due to a road accident. Her paternal grandfather late I. K. Chopra wanted to secure her future financially and was looking for some viable financial instruments/investments which would mature when the plaintiff would be above the age of 22 years.

(ii) That the defendant no. 2 approached and introduced himself as an authorized agent of the defendant no. 1 and advised late I. K. Chopra, the grandfather of the plaintiff to buy a New Jeewan Shree Policy with Guaranteed Addition and Loyalty addition on payment of a two lump- sum premiums of Rs. 6,11,382/- each, which would mature after 15 years from the date of purchase of the policy. The defendant no. 2 advised the grandfather of the plaintiff that the defendant no. 3 being the uncle of the plaintiff and the younger brother of her deceased father be made the life assured which he should assign in favour of the plaintiff.

(iii) That after the assignment by the defendant no. 3, at the time of maturity of the policy the maturity amount would be released in favour of the plaintiff. On being assured that the Instrument advised by the defendant no. 2 would CS No. 4195/2017 Vedha Chopra vs. Life Insurance Corporation of India and ors Page no. 2/36 safeguard the financial security of the plaintiff, the grandfather of the plaintiff agreed to purchase the above insurance policy.

(iv) That at the request of the late grandfather of the plaintiff, late I. K. Chopra, the premium amount for the policy was paid by Dr. B. D. Chopra, younger brother of the late grandfather and grand uncle of the plaintiff through his NRI account with the Indian Overseas Bank, Greater Kailash Part II, New Delhi.

The amount for first premium at the time of purchase of the policy was Rs. 6,11,382/- and the second and final premium was due on 23.12.2003. On receipt of payment of the first premium, the defendant no. 1 issued the insurance policy. The second Installment was also duly paid to the defendant no. 1 on 23.12.2003. It is pertinent to mention that no part of the premium payment was made by the defendant no. 3.

(v) That after the amount of the first installment was received by the defendant no. 1, the bond for the policy bearing number 122024977 was issued by the defendant no. 1 in the name of defendant no. 3, uncle of the plaintiff and the younger brother of the late father of plaintiff.

(vi) That as the policy was for the benefit of the plaintiff, the late grandfather of the plaintiff asked defendant no. 2 to complete the formalities of assignment of the policy in favour of the plaintiff. Around the second week of June 2003, the defendant no. 2 came to the residence of the grandfather of the plaintiff and wrote the contents of the assignment on the original policy bond in favour of the plaintiff in his own handwriting on the space earmarked for endorsements.The defendant no. 3 şigned the same in the presence of the grandfather of the plaintiff Late Sh. I.K Chopra, defendant no. 4, the grandmother of the plaintiff and defendant no. 5, the aunt of the plaintiff and elder sister of deceased father of the plaintiff.

(vii) That after the defendant no. 3 affixed his signatures on the original policy bond, the defendant no. 2 took it for registration of the assignment in the records of defendant no. 1. A few days later the defendant no. 2 returned the CS No. 4195/2017 Vedha Chopra vs. Life Insurance Corporation of India and ors Page no. 3/36 original policy bond to the grandfather of the plaintiff with the stamp of the defendant no. 1 affixed at the bottom of the assignment near the signatures of the defendant no. 3 and assured him that all the formalities for the assignment were complete. He assured the mother of the plaintiff, Mrs. Sanjana Chopra that, at the time of maturity, the amount would be payable by the defendant no. 1only to the plaintiff. That the grandfather of the plaintiff then handed over the original Policy Bond to the mother of the plaintiff in the presence of the defendant no. 4 and 5. Since then the mother of the plaintiff has been in possession and control of the original policy bond.

(viii) That on 13.11.2017, the plaintiff along with her mother went to the concerned branch of the defendant no. 1 to complete the formalities for remittance of the maturity amount with all other benefits, moneys and advantages of the above policy in the bank account of the plaintiff as the maturity date of the policy was approaching on 23.12.2107. To the surprise of the plaintiff and her mother, the staff at the branch of the defendant no. 1 informed them that though the assignment had been made and signed on the original policy bond, that the assignment had not been registered or recorded in the records of the company.

(ix) That as is manifested from the above narrative, the defendant no. 2 being the authorized agent of defendant no. 1 was duty bound to complete the formalities of getting the assignment recorded in the records of the defendant no. 1. There is apparent deficiency of service and negligence on the part the defendant no. 2 in not getting the assignment properly recorded in the records of the defendant no. 1. It is submitted that at this stage the defendant no. 1, being the principal of the defendant no. 2 cannot resile from the actions of defendant no. 2. Being its authorized agent, the defendant 1 is bound by the acts of the defendant no. 2 and the plaintiff cannot be made to suffer for the deficient services the part of the defendants 1 and 2. It is reiterated that while returning the policy bond after getting the assignment stamped at the office of the defendant no. 1 had informed the grandfather and mother of the plaintiff CS No. 4195/2017 Vedha Chopra vs. Life Insurance Corporation of India and ors Page no. 4/36 that the assignment has been carried out as per the procedure and was duly recorded in the records of the defendant no. 1. It is further submitted that in case of any negligence on the part of defendant no. 2 in completing the procedure of assignment, the defendant no. 1 being the principal is liable to Indemnify the plaintiff against any losses.

(x) That on making inquiries from various sources as to how to overcome the above situation, the mother of the plaintiff was informed that as a special purpose vehicle, a joint bank account of the plaintiff and the defendant no 3 should be opened for the exclusive purpose of the remittance of maturity amount in respect of the policy and details of the said bank account be provided to the defendant no. 1 with the mandate to remit the maturity amount into the said bank account and immediately after the withdrawal the maturity amount by the plaintiff, the bank account should be closed.

(xi) That the plaintiff along with her mother and the defendant no. 4 approached the defendant no. 3 but he expressed his unwillingness to open such a bank account for the reasons best known to him. The defendant no. 3 was then asked to give an undertaking with the commitment to transfer the total maturity amount received from the defendant no. 1 to the plaintiff immediately after it was remitted into his account. The defendant did not give any such undertaking or commitment.

(xii) That on 23.11.2017, the plaintiff made written request to the defendant no. 1 to stop the processing of any documents for payment of the maturity value of the above insurance policy provided by the defendant no. 3 with immediate effect as there is a dispute in respect of the entitlement of the maturity amount. The defendant no. 1 was also requested to withhold the payment of the amount of the maturity value of the policy in question to the defendant no. 3 or any other person including the nominee registered in the policy as it was likely to affect the valuable rights of the plaintiff. The coples of the same letter were also sent through speed-post to the regional and divisional offices of the defendant no. 1.

CS No. 4195/2017 Vedha Chopra vs. Life Insurance Corporation of India and ors Page no. 5/36

(xiii) That in response the plaintiff has received a reply 01.12.2017 from the defendant no. 1 wherein they have stated that on scrutinizing their records they have found that no assignment was recorded on the said policy as the defendant no. 3 never appeared in their office. It further stated that they had confirmed telephonically from the defendant no. 3 that he had not made any such assignment.

(xiv) That the defendant no. 3 has no right or lien over the maturity amount and the other benefits of the policy no. 122024977 since he had assigned the same to the plaintiff shortly after the same was issued. It is craved that this Hon'ble court may kindly be pleased to declare that the plaintiff alone is entitled to the maturity amount of the above mentioned policy.

(xv) That in the alternative, if the defendants no. 1 to 3 are unwilling to pay the maturity amount to the plaintiff, the plaintiff seeks the maturity amount of Rs 34 lacs from defendant 1 and 2 jointly and/or severally as there has been negligence and deficiency of service on part of the defendant no. 2 who being the authorized agent of defendant no. 1 was duty bound and under a legal obligation to ensure that the assignment was duly recorded in favour of the plaintiff in the records of the defendant no. 1.

(xvi) That the plaintiff is likely to suffer incalculable financial and emotional loss if the maturity value of the policy is not remitted to her. In case the amount is remitted to any account held by the defendant no. 3 without any undertaking or assurance that the same would be paid to the plaintiff upon remittance, it may complicate and compound the problem, as neither the premium amount was paid by the defendant no. 3 nor the policy was taken for his benefit.

(xvii) That the plaintiff apprehends that the defendant no. 1, at the request of the defendant no. 3, on the basis of false documents, submissions and affidavits filed by the defendant no. 1 may even prematurely pay the maturity amount to him, which is likely to frustrate the efforts of the plaintiff. CS No. 4195/2017 Vedha Chopra vs. Life Insurance Corporation of India and ors Page no. 6/36 (xviii) That the defendant no. 1 is bound by the acts, commissions and omissions of the defendant no. 2 as he is its authorized agent. The defendant no. 1 is bound to complete the formalities for the assignment of the policy. That the failure to register and record the assignment is the cause of action for the present suit.

(xix) That the plaintiff has a prima facie case in her favour as the premium instalments were not paid by the defendant no.3 and he made the endorsement in favour of the plaintiff in the year 2003. The balance of convenience is favour of the plaintiff and against the defendant.

(xx) That the cause of action for the above suit arose on 10.12.2002 when the proposal for the above policy was sent for consideration of the defendant no. 1. It further arose on 23.12.2002 when the defendant no. 1 accepted the premium and it issued the policy bearing 122024977. It further arose around the second week of June 2003 when the defendant No 2 handwrote the assignment in favour of the plaintiff and the defendant no. 3 signed the same. It further arose on 10.06.2003 when the defendant no. 1 though affixed its office stamp on the policy bond but did not register the assignment in its records. It further arose on 13.11.2017 when the defendant no. 1 informed the plaintiff that the assignment was not registered in their records. It further arose on 19.11.2017 when the defendant no. 3 did not agree to open a joint account with the plaintiff for remittance of the maturity amount of the policy in her favour. It further arose on 19.11.2017 when the defendant no. 3 refused to give an undertaking to the effect that the entire maturity amount would be transferred to the plaintiff after the same was remitted to his account. That it arose on 23.11.2017 when the plaintiff sent the letter to the defendant no. 1 to stop processing the documents in respect of the payment of the maturity amount of the policy no. 122024977. Thus, the present suit was filed by the plaintiff seeking following reliefs :-

CS No. 4195/2017 Vedha Chopra vs. Life Insurance Corporation of India and ors Page no. 7/36 A) Pass a decree of Declaration in favour of the plaintiff and against the defendants no. 1 to 3 thereby declaring that the plaintiff being the actual beneficiary is entitled to the complete maturity amount under the policy no.

122024977 issued by the defendant no. 1 duly endorsed/assigned in favour of the plaintiff by the defendant no 3.

(B) Pass decree of mandatory Injunction in favour of the plaintiff and against the defendant no. 1 thereby directing the defendant no. 1 to update its record and register the assignment in favour of the plaintiff in respect of the policy no. 122024977 Issued by the defendant no. 1.

C) Pass decree of permanent injunction in favour of the plaintiff and against the defendant no. 1 thereby restraining the defendant no. 1 from releasing or transferring the maturity amount under the policy no. 122024977 issued by the defendant no. 1 in favour of the defendant no. 3 or any representatives/ assigns or other person claiming on his behalf.

D) Or in the alternative pass a decree for a sum of Rs. 34,00,000/- (Rupees thirty four lacs) being the maturity amount with all the other benefits of the policy number 122024977 in favour of the plaintiff and against defendants no. 1-3 along with pendente lite interest @18% per annum from the date of filing till realization.

E) Award costs of the present suit in favour of the plaintiff. F) Pass any other such/ further order(s) or relief(s), which this Hon'ble Court deems fit and proper upon the facts and under the circumstances of the case.

WRITTEN STATEMENT OF DEFENDANT NO. 1

2. Defendant no. 1 filed his written statement denying the contents of the plaint pleadings inter alia as under :

(i) That the maturity proceeds is payable to the policy holder and the defendant no. 3 is the policy holder in the records of answering defendant and that no document was presented for assignment hence assignment could not be registered and that there is no negligence or failure on the part of answering defendant. It was submitted that endorsement on bond has no significance CS No. 4195/2017 Vedha Chopra vs. Life Insurance Corporation of India and ors Page no. 8/36 unless it is registered in the records of the corporation. It was further submitted that defendant no. 2 has not approached the office of defendant no. 1 and no stamp was affixed on the policy bond and no assignment has been registered in the record of defendant no. 1 and no endorsement was done by defendant no. 1 on the policy document. It was further submitted that since no document was ever presented for assignment hence the same could not be registered and there is no failure on the part of the defendant no. 1. It was specifically submitted that no office stamp was affixed on the bond by the branch.

(ii) On merits, each and every content of the plaint has been denied.

WRITTEN STATMENT OF DEFENDANT NO. 2

3. Defendant no. 2 filed his written statement stating that the plaintiff does not disclose any cause of action against the replying defendant and as such the suit is liable to be dismissed and that the suit of the plaintiff seems to be collusive suit between plaintiff and the defendant no. 3 and that the defendant no. 3 had one insurance policy in the family and both of them want two benefits from one policy. It has further been contended that it was late Sh. I.K Chopra who approached the defendant no. 2 and wanted to have an insurance policy and that the defendant no. 2 gave him the options of various policies as per his responsibility however, the decision of buying the particular policy was of Late Sh. I.K Chopra. It has further been denied that the defendant no. 2 advised the grandfather of the plaintiff that the defendant no. 3 being the uncle of the plaintiff and younger brother of her deceased father be made the life assured which he should assign in favour of the plaintiff. It has further been contended that late Sh. I.K Chopra wanted to purchase the policy in question in the name of defendant no. 3 and also that the defendant no. 2 being only an agent of defendant no. 1, followed the instructions given by Late Sh. I.K Chopra. On merits, it has been admitted by defendant no. 2 that he wrote the endorsement at the asking of the grandfather of the plaintiff and that as admitted by the plaintiff, defendant no. 3 did not sign the endorsement in the presence of defendant no. 2. Defendant no. 2 has specifically denied that he ever took the CS No. 4195/2017 Vedha Chopra vs. Life Insurance Corporation of India and ors Page no. 9/36 endorsement for registration of the assignment in the records of defendant no. 1 or that he returned the original policy bond to the grandfather of defendant no. 1 with the stamp of defendant no. 1 affixed at the bottom on the assignment near signatures of defendant no. 3 or giving assurance to him that the formalities for assignment were complete. It is further denied by defendant no. 2 that he extended any assurance to the mother of plaintiff no. 1 to the effect that the maturity amount would be payable only to plaintiff no. 1. It has been submitted that he was nowhere in picture after writing of the endorsement. He has specifically denied any deficiency of service or negligence on his part.

WRITTEN STATEMENT BY DEFENDANT NO. 3

4. Defendant no. 3 filed his written statement stating that the plaintiff has got no locus standi to file the present suit and that the policy in question is in the name of the answering defendant no.3 and no right in this manner accrue in favour of the plaintiff and as such the present suit as filed by the plaintiff is liable to be rejected. It has further been stated that the present suit is without any cause of action.

5. It has further been stated that the present suit is barred by limitation and that the plaintiff by filing the present suit claiming the relief of declaration, perpetual and mandatory injunction with regard to the policy which was undertaken in the year-2002 and relying upon the endorsement of the year-2003 for basing its claim thereupon and the limitation for the same is three years only and as such the present suit which is being filed by the plaintiff in the year-2017 is not maintainable.

6. That the present suit is nothing but a collusive suit by the plaintiff in collusion with the defendant no. 4 to 6 without any right so vested to the plaintiff and that the endorsement on which the plaintiff relies is a forged, manipulated act of the plaintiff which does not bind the answering defendant no. 3 or the defendant no. 1 in any manner and the proceeds of the policy are liable to be released in favour of the answering defendant no. 3 without any delay. It has further been denied by defendant no. 3 that the premium amount of the policy CS No. 4195/2017 Vedha Chopra vs. Life Insurance Corporation of India and ors Page no. 10/36 in question was paid by younger brother of the late grandfather and it has been contended that the policy was taken in the name of defendant no. 3 by himself by taking financial help and defendant no. 3 was made to sign on the space so provided for endorsement on the plea that the same requires the signatures of the assured person and at that time no assignment was written as such no assignment ie being got recorded with defendant no. 1. Later on, the said assignment words were incorporated without the consent of the defendant no. 3 by misuing the signatures of defendant no. 3 which were already there when such assignment was so recorded on the said document. Defendant no. 3 was not agreeing to such assignment and as such the said assignment was not got registered in the records of defendant no. 1. He has specifically stated that the policy belongs to him and the plaintiff has taken the original policy documents from the common pool in which the said documents were kept. He has specifically denied having made any assignment of the policy in question in favour of the plaintiff and has asserted his beneficial rights in the policy in question. On merits, each and every para of the plaint has been denied by the defendant no. 3 in his written statement.

WRITTEN STATMENT BY DEFENDANT NO. 4, 5 AND 6

7. Defendant no. 4, 5 and 6 have filed their joint written statement stating that all the present answering defendants have been impleaded as performa parties and no relief has been sought against them and that the answering defendants have filed their joint written statement only in support of the suit of the plaintiff. It has further been contended that the defendant no. 3 signed the endorsement in the presence of the grandfather of the plaintiff Late I.K Chopra, defendant no. 4 and defendant no. 5. It has further been contended that the defendant no. 2 took the original policy bond for registration of the assignment in the records of defendant no. 1 and when the sam was returned to Late I.K Chopra with the stamps of the defendant no. 1 at the point where the defendant no. 3 had put his signatures. It has been contended that the defendant no. 2 assured that the assignment had been duly recorded in the records of defendant no. 1 and that CS No. 4195/2017 Vedha Chopra vs. Life Insurance Corporation of India and ors Page no. 11/36 the original policy bond was handed over to Sanjana Chopra, mother of the plaintiff in the presence of the defendant no. 4 and 5. It has also been contended that the assignment was written by the defendant no. 2 in his own handwriting in the presence of the defendant no. 4 and 5 after which the defendant no. 3 signed the same in their presence and the defendant no. 2 took the original policy bond for getting the same registered in the records of the defendant no. 1.

8. Plaintiff has filed her separate replications to the written statements as filed by defendant no. 1 to 3 reiterating the contents of the plaint and denying each and every allegation levelled upon.

ISSUES

9. My Ld. Predecessor had framed the following issues for adjudication :-

1. Whether the endorsement of assignment on Ex P-2 (document partly admitted by defendant no. 2, denied by defendant no. 3) was duly made? OPP

2. Whether the said endorsement was required to be presented for assignment and said assignment was to be registered in the records of Life Insurance Corporation? OPD 1

3. Whether the suit is bad for mis joinder of defendant no. 2? OPD 2

4. Whether the plaintiff is entitled for reliefs as claimed in prayer clause? OPP

5. Relief.

EVIDENCE

10. The plaintiff, in order to prove her case had examined two witnesses i.e. Ms. Vedha Chopra as PW-1 who tendered her evidence by way of affidavit Ex.PW1/A and she had relied upon the documents i.e. PW1/1 to PW1/7 and the said documents are as follows :

                   S.No.           Exhibits                  Documents
                     1.             PW1/1                The policy bond.

CS No. 4195/2017 Vedha Chopra vs. Life Insurance Corporation of India and ors Page no. 12/36 2 PW1/2 Premium Receipt dated 23.12.2002.

3. PW1/3 Premium renewal receipt.

4. PW1/4 Letter dated 23.11.2017.

5. PW1/5 Postal receipts of the and PW1/6 dispatch of the letter to regional office and divisional office of the defendant no. 1.

6. PW1/7 Reply dated 01.12.2017 by the defendant no.1 and the envelop in which it was received.

11. The said witness was duly cross-examined by the counsel for defendant no. 1 to 6 on subsequent dates and vide order dated 10.10.2018, PW-1 was discharged.

12. Ms. Sanjana Chopra was examined as PW-2 who tendered her evidence by way of affidavit Ex. PW2/A and she relied upon the documents as that of PW-1. The said witness was duly cross-examined by the counsels for the defendants.

13. Perusal of the record shows that defendant no. 1 did not lead any evidence.

However, on behalf of defendant no. 2, Sh. Vinod Bhatia entered the witness box as D2W1 who was duly cross-examined by the counsel for the plaintiff on subsequent dates and vide order dated 16.01.2023, DE on behalf of defendant no. 2 was closed.

14. Sh. Umesh Chopra entered into the witness box as D3W1 and the said witness was duly cross-examined by the counsel for the plaintiff as well as by the counsel for the defendant no. 5.

15. Smt Saroj Chopra entered into the witness box as D4W1 and was duly cross-

examined by the counsel for the defendant no. 2 and 3 on subsequent dates.

CS No. 4195/2017 Vedha Chopra vs. Life Insurance Corporation of India and ors Page no. 13/36

16. Smt. Manju Oberoi entered into the witness box as D5W1 and at later stage of cross-examination, she tendered letter issued by Dr. B.D Chopra in respect of the payments of premium for the LIC policy no. 122024995 exhibited as Ex. D5/W1/X (OSR). The said witness was duly cross-examined by the counsel for the defendant no. 2 and 3 on subsequent dates and accordingly, DE was closed vide order dated 03.07.2023.

ANALYSIS AND FINDINGS Issue no. 1 : Whether the endorsement of assignment on Ex P-2 (document partly admitted by defendant no. 2, denied by defendant no. 3) was duly made? OPP

17. The onus to prove this issue was upon the plaintiff. The plaintiff in order to prove this issue was required to prove Ex P-2 which is the endorsement form of the policy in question and purports to effect assignment of all the beneficial right title interests in the policy in question in the name of Defendant No 3 by way of gift. In order to prove this issue, the Plaintiffs have relied upon the testimony of PW-1 and PW-2 and also of the Testimonies of D4W1 and D5W1. As per the testimony of PW-1 and PW-2, it has been stated that an insurance policy of defendant no. 1 was obtained by the grandfather of the plaintiff i.e. Sh. I K Chopra on the advice of defendant no. 2 i.e. the Insurance Agent. It has been stated by PW-1 in her affidavit i.e. Ex. PW1/A that defendant no. 3 being her uncle i.e. younger brother of his deceased father was made the life assured. The premium for the policy was paid by Dr. B.D Chopra i.e. younger brother of her grandfather and not by defendant no. 3. Upon payment of the first premium, the policy bearing no. 122024977 was issued by defendant no. 1 in the name of defendant no. 3 in June, 2002. As per PW-1 since the policy had been obtained for her benefit, defendant no. 2 was asked by her late grandfather to complete the formality of assignment in her favour and accordingly, defendant no. 2 wrote the assignment on the original policy bond in his handwriting at the space earmarked for endorsement in the presence of defendant no. 2. Defendant no. 3 signed the assignment in CS No. 4195/2017 Vedha Chopra vs. Life Insurance Corporation of India and ors Page no. 14/36 presence of her late grandfather, her grandmother i.e. defendant no. 4 and her aunt i.e. defendant no. 5. That after defendant no. 3 had signed the assignment, the same was taken by defendant no. 2 for the purposes of the registration of the assignment in the records of defendant no. 1. Defendant no. 2 thereafter returned the original policy bond to her late grandfather with the insurance notary stamps affixed on the original policy bond and the seal of the branch of defendant no. 1 affixed at the bottom of the assignment near the signatures of defendant no. 3. Defendant no. 2 had assured the grandfather of the plaintiff that all the formalities of the assignment were complete and also that the maturity amount would be paid to Plaintiff No 1 by defendant no. 1. Her Late Grandfather thereafter handed over the original policy bond to PW-2 in the presence of defendant no. 4 and 5 who since thereafter has been in possession and control of the original policy bond.

18. In the cross-examination PW-1 has categorically admitted that she has no personal knowledge with respect to the contents of her affidavit i.e. Ex. PW1/A and she has deposed on the basis of what was told to her by her mother and her aunt. Thus, being hearsay, no reliance can be placed upon the testimony of PW-1.

19. PW-2 had deposed on the lines of the plaint and she was cross-examined at length by the counsel for defendant no. 3 who has clearly denied the suggestion that the insurance policy was taken by defendant no. 3 for his own benefits and as such the premium of the same was paid as such or that the said premium was paid and deposited at the instance of defendant no. 3. She further denied that defendant no. 3 never assigned the policy in question in favour of plaintiff No 1 or that she was in possession of the original policy bond unlawfully or that the assignment endorsement was manipulated by her taking advantage of the custody and possession of the original policy bond. However, it has not been stated by PW2 that she was present or had witnessed the signing of the assignment made by Defendant No 3 or that Defendant No 2 was handed over the assignment written on endorsement sheet of the policy in CS No. 4195/2017 Vedha Chopra vs. Life Insurance Corporation of India and ors Page no. 15/36 question in her presence or was returned by Defendant 2 to Sh I K Chopra in her presence. She has further not stated that the original policy bond was handed over to her by I K Chopra in the presence of Defendant No 3.

20. Defendant no. 4, 5 and 6 i.e. mother of defendant no. 3, sister of defendant no.

3 and Dr. B.D Chopra had supported the case of the plaintiff. Sh B D Chopra had filed his evidence but has not entered in the witness box. D4W1 i.e Defendant No 4 i.e mother of Defendant No 3 has that the policy in question was taken for the exclusive benefit of the Plaintiff No 1 though the life assured thereof was defendant no. 3. Defendant no. 4 has also admitted that another policy in her name was obtained by Late Sh. I.K Chopra (grandfather) for the benefit of the plaintiff where defendant no. 4 was the life assured. It has been admitted by defendant no. 4 that the assignment on the insurance policy was written by defendant no. 2 in her presence and also that no amount of premium was paid by defendant no. 3 and neither the said policy was for his benefit.

21. D4W1 who has supported the case of the plaintiff had sworn her affidavit by way of evidence as Ex. D4W1/A. In D4W1/A, she has deposed that defendant no. 2 had advised her husband to purchase the insurance policy for the exclusive benefit of Plaintiff no. 1 with defendant no. 3 as the life assured and also to get the same assigned in favour of plaintiff no. 1. She has further deposed that the instalments towards premium of the policy in question was gifted by defendant no. 6 i.e. Dr. B.D Chopra. She had further deposed that on the policy bond of the policy in question, defendant no. 2 wrote the contents of the assignment in favour of plaintiff no. 1 in his handwriting and in the presence of plaintiff no. 2, defendant no. 3 and defendant no. 5 and herself. She has further deposed that defendant no. 3 had signed the assignment in her presence and in the presence of her late husband and defendant no. 5. She has further deposed that defendant no 2 took the original policy for registration of the assignment and later returned it to her husband. She had also deposed that another policy was obtained by her husband which was obtained in the name CS No. 4195/2017 Vedha Chopra vs. Life Insurance Corporation of India and ors Page no. 16/36 of defendant no. 3 as life assured upon which also, the premium was paid by Sh. B.D Chopra. She has further deposed that the policy bond where defendant no. 3 was life assured was handed over to him. She has also deposed that the original policy bond in question was handed over by her husband to plaintiff no. 2 in her presence and also in the presence of defendant no. 5 and that plaintiff no. 2 has been in possession and control of the original policy bond ever since. She has further deposed that another policy had been obtained for the benefit of plaintiff no. 1 with her as life assured and the amount of the said policy has been transferred to plaintiff no. 1. She has also deposed that defendant no. 3 has no right over the maturity amount of the policy in question since it was for the exclusive benefit of plaintiff no. 1 and who alone is entitled to its maturity amount.

22. D4W1 was duly cross-examined by counsel for defendant no. 3. In her cross-

examination she has clearly denied the suggestion that the policy in question was taken for the benefit of defendant no. 3 or that defendant no. 2 had not written any assignment in her presence or that she was not present at the time when the policy was taken. She has specifically denied the suggestion that defendant no. 3 never signed any policy document in her presence and has further denied that defendant no. 3 was in possession of the policy bond. She has specifically stated that the policy bond was always with the mother of the plaintiff No 1.

23. Defendant no. 4 was also cross-examined by the counsel for defendant no. 2 who has clearly stated that the assignment was written by Defendant No 2 and also that her son had signed in front of her. She further deposed that she do not remember the date when assignment was written and signed by defendant no 3. She further stated that after writing of the assignment and upon signature of Defendant No 3, Defendant No 2 immediately took the policy and assignment for registration. She has clearly deposed that the policy was not taken in the name of plaintiff no. 1 and was instead taken in the name of defendant no. 3 so as to give him respect.

CS No. 4195/2017 Vedha Chopra vs. Life Insurance Corporation of India and ors Page no. 17/36

24. D5W1 is the sister of defendant no. 3 and aunt of plaintiff no.1. D5W1 while supporting the case of the plaintiff, has deposed on the lines of her written statement. D5W1 has stated that defendant no. 2 wrote the contents of the assignment in favour of plaintiff no. 1 in his own handwriting on the original policy bond of the policy in question in the space earmarked for endorsements in her presence and in the presence of Late Sh. I.K Chopra and defendant no.

4. It has further been stated by her that defendant no. 3 had signed the same in the presence of Late Sh. I.K Chopra, plaintiff no. 2, defendant no. 4 and herself. Thus, her stand is clearly contradictory to the stand taken by Plaintiff No 2 and D4W1 who have not stated that Plaintiff No 2 was present at the time of signing of the assignment by Defendant No 3 written on the endorsement form of the Policy in question. D5W1 was duly cross-examined by counsels for defendant no. 2 and also of defendant no. 3.

25. In the cross-examination, conducted by defendant no. 3, she has stated that three policies were purchased i.e. one in her name, one in the name of defendant no. 3 for his benefit and one in the name of defendant no. 3 for the benefit of the plaintiff No 1. She has testified that the policy in question was taken for the benefit of the plaintiff No 1. She has further deposed that defendant no. 3 had signed the assignment as written by defendant no. 2 and has clearly denied the suggestion to the effect that there was no assignment note on the policy bond no. 122024977 when defendant no. 3 had signed the same. She has further denied the suggestion that defendant no. 3 never signed the said policies in favour of the plaintiff or that the writing of the assignment and sign did not take place in her presence. She has further denied the suggestion that the policy in question was never assigned in favour of the plaintiff.

26. Defendant no. 3 who is the uncle of the plaintiff had filed his written statement contending that the policy in question is in the name of the answering defendant no.3 and no right in this manner construe in favour of the plaintiff and as such the present suit as filed by the plaintiff is liable to be rejected. It CS No. 4195/2017 Vedha Chopra vs. Life Insurance Corporation of India and ors Page no. 18/36 was further contended by defendant no. 3 that the endorsement on which the plaintiff relies is a forged, manipulated act of the plaintiff which does not bind the answering defendant no. 3 or the defendant no. 1 in any manner and the proceeds of the policy are liable to be released in favour of the answering defendant no. 3 without any delay. It has further been denied by defendant no. 3 that the premium amount of the policy in question was paid by younger brother of the late grandfather and it has been contended that the policy was taken in the name of defendant no. 3 by himself by taking financial help and defendant no. 3 was made to sign on the space so provided for endorsement on the plea that the same requires the signatures of the assured person. It has further been contended that at the time no assignment is being written as such and as such no such assignment is being got recorded with defendant no. 1. It has further been contended that later on the said assignment words were incorporated without the consent of defendant no. 3 by misusing his signatures which were already there when such assignment was so recorded in the document. In sum and substance, it is the contention of defendant no. 3 that he signed the endorsement in blank and the said signatures have been misused. It has been contended that defendant no. 3 has never assigned the policy in favour of the plaintiff and also that the policy belongs to defendant no. 3 who is the legal beneficiary under the policy and is entitled to its maturity amount. Defendant no. 3 in support of his pleaded case relied upon his testimony who was examined as D3W1 and had deposed on the lines of his written statement however, in his testimony, it has been stated that the endorsement on the insurance policy is forged and manipulated act of the plaintiff. It has further been stated that his father might have taken his signatures on the policy alleging the same to be a requirement to accept the policy however, the endorsement at the time of his signatures was not so written and neither it bear any stamp or seal of any insurance company. However in his cross examination it has been admitted by D3W1 that he has not paid any insurance premium for the policy in question. He has further admitted that he did not have the original CS No. 4195/2017 Vedha Chopra vs. Life Insurance Corporation of India and ors Page no. 19/36 policy bond or the original premium payment receipts since his father used to keep the same. He has admitted that signatures on Ex P-2 were his signatures however he has stated that he signed on the same for receiving the original only and also that his father had asked him to sign. He has specifically denied his presence at the time when terms of the assignment was written by Defendant No 2.

27. D2W1/Defendant no. 2 who is a LIC agent, in his examination-in-chief has deposed that the grandfather of the plaintiff asked the witness to write an endorsement in favour of the plaintiff No 1 by defendant no. 3. Upon being cross-examined, D2W1 has admitted that he has been asked to write the endorsement by Late Sh. I.K Chopra since Sh. I.K Chopra intended that the benefits of the subject policy be enjoyed by the plaintiff. He has further deposed that at the time of writing of the endorsement, he had informed Sh. I.K Chopra that the original endorsement has to be signed, dated and attested by one witness and notice of assignment is also required to be signed by the insured. He has clearly denied the suggestion that defendant no. 3 has put his signatures in his presence and has further stated that the endorsement might have been signed by Sh. Umesh Chopra later on with the same pen as the pen belonged to Sh. I.K Chopra. It has further been deposed by D2W1 that defendant no. 3 did not contact him for receiving the benefits under the policy in question and that he got in touch with defendant no. 3 when the policy in his name got matured. He has further admitted that at the time of writing of the endorsement, three four person including Sh. I.K Chopra were present and that he had informed to Sh. I.K Chopra and to Umesh Chopra that the registration of the endorsement is mandatory. D2W1, despite opportunity having been granted was not cross-examined by defendant no. 3.

28. From the aforesaid oral testimonies of PW2, D4W1, D5W1 it has come on record that the Insurance policy was in the name of Defendant No 3. Defendant No 2 was called by I K Chopra to write the terms of assignment in favour of Plaintiff No1. Defendant No 2 wrote the terms of assignment in the presence of CS No. 4195/2017 Vedha Chopra vs. Life Insurance Corporation of India and ors Page no. 20/36 PW2, D4 and D5 and Sh I K Chopra but not in the presence of Defendant No

3. From the aforesaid testimonies, it has also come on record that Defendant No 3 had signed the terms of assignment. However Defendant No 3 had not admitted that he signed the endorsement form of the policy in question after the terms of assignment had been handwritten thereupon and has stated that he signed the endorsement form so as to get the original and also that his father had asked him to sign. He has specifically denied his presence at the time when terms of the assignment was written by Defendant No. 2.

29. Thus since there is a categorical denial of the execution of the terms of the assignment by Defendant No 3, in order to prove the present issue i.e whether the endorsement of assignment was duly made i.e whether Defendant No 3 had executed the same, the Plaintiffs are required to prove Ex. P-2 i.e. the endorsement form of the insurance policy in question upon which the terms of assignment were admittedly written by Defendant No 2 and upon which signatures have been admittedly made by Defendant No 3 who has stated that he signed the endorsement form of the policy in question so as to receive the original policy bond and also that his father had asked him to sign. Admittedly there is no attesting witness to Ex.P2 and only oral testimonies of the witnesses have been lead in the present matter. The only question under the circumstances which requires analysis is whether oral testimonies in law are sufficient to prove the assignment of the insurance policy purported to have been effected in favour of Plaintiff No 1 under Ex.P2.

30. Assignment of an Insurance Policy is governed by Section 38 of the Insurance Act, 1938. Under the mandate of Section 38 ( prior to the amendment) of the Insurance Act 1938, the assignment of an Insurance Policy in law to be complete and effectual is required to be not only executed by the assignor but is also required to be attested by atleast one witness. Unamended Section 38 is an exception to section 130 of the Transfer of Property Act. Section 130 of the Transfer of Property Act as well as Unamended Section 38 of the Insurance Act which governs the transfer of actionable claims provides as follows:

CS No. 4195/2017 Vedha Chopra vs. Life Insurance Corporation of India and ors Page no. 21/36 Section 130 of the Transfer of Property Act (1) An actionable claim whether with or without consideration can be effected only on the execution of an instrument in writing signed by the transferor or his duly authorized agent and which transfer shall be complete and effectual upon the execution of such instrument and thereupon all the rights and remedies of the transferor whether by way of damages or otherwise shall vest in the transferee, whether such notice of the transfer has been given or not:

Provided that every dealing with the debt or other actionable claim by the debtor or other person from or against whom the transferor would, but for such instrument of transfer as aforesaid, have been entitled to recover or enforce such debt or other actionable claim, shall (save where the debtor or other person is a party to the transfer or has received express notice thereof as hereinafter provided) be valid as against such transfer.

(2) The transferee of an actionable claim may, upon the execution of such instrument of transfer as aforesaid, sue or institute proceedings for the same in his own name without obtaining the transferor's consent to such suit or proceeding and without making him a party thereto.

Exception.- Nothing in this Section applies to the transfer of a marine or fire policy of insurance (or affects the provisions of Section 38 of the Insurance Act, 1938 ( 4 of 1938)."

31. Thus, from the aforesaid Section i.e. Section 130, a transfer of actionable claim can only be effected by the execution of an instrument in writing signed by the transferor and the transfer of the actionable claim becomes complete and effectual upon the execution of the instrument. However, an exception has been created under Section 130 of the Transfer of Property Act vide which it has been provided that nothing in Section 130 applies to the transfer of a marine or fire policy of insurance or affects the provisions of Section 38 of the Insurance Act, 1938.

Unamended Section 38 of the Insurance Act, 1938 "38. Assignment and transfer of insurance policies. (1) A transfer or assignment of a policy of life insurance, whether with or without consideration may be made only by an endorsement upon the policy itself or by a separate instrument, signed in either case by the transferor or by the assignor or his duly authorized agent and attested by at least one witness, specifically setting forth the fact of transfer or assignment.

CS No. 4195/2017 Vedha Chopra vs. Life Insurance Corporation of India and ors Page no. 22/36 (2) The transfer or assignment shall be complete and effectual upon the execution of such endorsement or instrument duly attested but except where the transfer or assignment is in favor of the insurer shall not be operative as against an insurer and shall not confer upon the transferee or assignee, or his legal representative, any right to sue for the amount of such policy or the moneys secured thereby until a notice in writing of the transfer or assignment and either the said endorsement or instrument itself or a copy thereof certified to be correct by both transferor and transferee or their duly authorized agents have been delivered to the insurer:

Provided that where the insurer maintains one or more places of business in India, such notice shall be delivered only at the place in India mentioned in the policy for the purpose or at its principal place of business in India.

(3) The date on which the notice referred to in sub-section (2) is delivered to the insurer shall regulate the priority of all claims under a transfer or assignment as between persons interested in the policy; and where there is more than one instrument of transfer or assignment the priority of the claims under such instruments shall be governed by the order in which the notices referred to in sub- section (2) are delivered.

(4) Upon the receipt of the notice referred to in sub section (2), the insurer shall record the fact of such transfer or assignment together with the date thereof and the name of the given, or of the transferee or assignee, on payment of the person by whom the notice was given, or of the transferee or assignee, on payment of a fee not exceeding one rupee, grant a written acknowledgment of the receipt of such notice; and any such acknowledgment shall be conclusive evidence against the insurer that he has duly received the notice to which such acknowledgment relates. (5) Subject to the terms and conditions of the transfer or assignment, the insurer shall, from the date of receipt of the notice referred to in sub-section (2), recognise the transferee or assignee named in the notice as the only person entitled to benefit under the policy, and such person shall be subject to all liabilities and equities to which the transferee or assignor was subject to the policy without obtaining the consent of the transferor or assignor or making him a party to such proceedings.

32. From the perusal of the unamended Section 38 of the Insurance Act, 1938, it is evident that for a valid assignment of an insurance policy, the same has to be made by way of an endorsement either on the policy itself or by a separate instrument and signed by the transferor/assignor. It is further required to be attested by atleast one witness specifically setting forth the fact of transfer or assignment and the transfer/assignment would be complete and affectual upon the execution of the endorsement or instrument duly attested.

CS No. 4195/2017 Vedha Chopra vs. Life Insurance Corporation of India and ors Page no. 23/36

33. From a conjoint reading of section 130 of the TPA and also of unamended Section 38 of the Insurance Act, it is clear that a special exception has been carved out in matters covered by section 38 ( unamended) of the Insurance Act. While under Section 130 Transfer of Property Act actionable claim can be transferred with the execution of an instrument in writing signed by the transferor or his duly authorized agent and the transfer shall be complete and effectual upon the execution of such instrument by the transferor. However under the Section 38 of the Insurance Act, the transfer or assignment of a policy of life insurance in order to be complete and affectual besides the signatures of the transferor has to be attested by one witness setting forth the fact of transfer/assignment. Thus, the transfer/assignment of the life insurance policy would only be complete and effectual under the provisions of Section 38 upon the execution of endorsement of instrument duly attested.

34. Thus, it is clear that the life insurance policies under the unamended provisions of the Insurance Act, 1938 are in law required to be attested by atleast one witness.

35. The Transfer of Property Act defines the term "attested" as follows :-

"Attested", in relation to an instrument, means and shall be deemed always to have meant attested by two or more witnesses each of whom has seen the executant sign or affix his mark to the instrument, or has seen some other person sign the instrument in the presence and by the direction of the executant, or has received from the executant a personal acknowledgment of his signature or mark, or of the signature of such other person, and each of whom has signed the instrument in the presence of the executant, but it shall not be necessary that more than one of such witnesses shall have been present at the same time, and no particular form of attestation shall be necessary."

36. Thus, in terms of the above definition of the term "attested", the witness must have seen the executant sign or affix his mark to the instrument and such witness must have signed the instrument in the presence of the executant.

37. Section 68 of the Indian Evidence Act, 1872 deals with the proof of the execution of document required by law to be attested as follows :-

CS No. 4195/2017 Vedha Chopra vs. Life Insurance Corporation of India and ors Page no. 24/36 "If a document is required by law to be attested, it shall not be used in evidence until one attesting witness atleast has been called for the purpose of proving its execution, if there be an attesting witness alive, and subject to the process of the court and capable of giving evidence:

Provided that it shall not be necessary to call an attesting witness in proof of the execution of any document, not being a Will, which has been registered in accordance with the provisions of the Indian Registration Act, 1908, unless its execution by the person by whom it purports to have been executed is specifically denied."

38. Admittedly, in the present case, the endorsement form containing the terms of assignment in question has not been registered in accordance with the provisions of the Indian Registration Act, 1908. Defendant no. 3 in his written statement has stated that the endorsement on which the plaintiff relies is a forged, manipulated act of the plaintiff which does not bind defendant no. 3. It has further been stated by defendant no. 3 that he signed on the blank endorsement without the terms of the assignment written on the same which have been incorporated later on by misusing his signatures. It is specifically denied by defendant no. 3 that he never assigned the insurance policy in favour of the plaintiff. Thus, in view of the endorsement/assignment not having been registered in accordance with the provisions of Indian Registration Act, 1908 and in view of a specific denial by defendant no. 3 by whom the endorsement/assignment purportedly having been executed, the endorsement effected on the form of policy containing the terms of assignment was required to be proved in accordance with Section 68 of the Indian Evidence Act i.e through the testimony of atleast one attesting witness in the absence of which the Endorsement form of the policy in question cannot be used in evidence.

39. In the present case, there is no witness who has attested the endorsement form of policy in question purporting to assign the beneficial right, title and interests in the policy in question in favour of Plaintiff No 1. Thus no reliance can be placed upon the oral testimonies of PW-2, D4W1, D5W1, since they are not the attesting witnesses to the endorsement form of the policy in question purporting to effect assignment in favour of Plaintiff No 1. In the absence of CS No. 4195/2017 Vedha Chopra vs. Life Insurance Corporation of India and ors Page no. 25/36 any attesting witness, neither the assignment of the policy in question became complete and effectual in favour of Plaintiff No 1 nor its execution is proved in law since it was only the attesting witnesses who could have proved the execution of the assignment as per the requirement of law i.e unamended section 38 of the Insurance Act which is a special Act read with Section 68 of the Indian Evidence Act. Thus from the mere oral testimonies, the endorsement form of the policy in question i.e. Ex. P-2 purporting to effect assignment of all the beneficial rights, title and interests in the policy in question in favour of Plaintiff No 1 cannot be said to be proved which could only have been proved in a specific manner and in accordance with law . Hence no reliance can be placed on the oral testimonies of the witness in the present case.

40. The Hon'ble Apex Court in the matter of LIC of India Vs Insure Policy Plus Services Pvt. Ltd & Ors; Civil Appeal no. 8542 of 2009 after elaborately discussing the unamended section 38 of the Insurance Act vide para(s) 10 and 11 has held as follows:

"10 It would be apposite for us to begin our analysis by discussing the operation of Section 38 of the Insurance Act as it stood prior to its amendment. Section 38 (1) prescribed the procedure by which assignment were to be effected, namely, by way of an endorsement or by means of a separate instrument. Sub-section (2) stated that once a transfer or assignment was made in the manner prescribed by sub-

section (1), it was complete and effectual. However, this transfer or assignment only became binding upon written notice thereof being given by the transferor and transferee to the insurer. Sub-section (3) determined the priority of claims on the Insurance Policy by operation of law. Sub-section (4) directed that upon receipt of the notice referred to in sub-section (2), the insurer became bound to record the transfer or assignment together with the date thereof and the name of the transferee and the assignee; and if so requested grant a written acknowledgment of the receipt of such notice. Sub-section (5) mandated the insurer to recognise the transferee or assignee named in the notice as the only person entitled to the benefit under the policy and such person would be subject to all liabilities and equities. Sub-section (6) and (7) provided for some other contingencies with which we are not immediately concerned."

CS No. 4195/2017 Vedha Chopra vs. Life Insurance Corporation of India and ors Page no. 26/36 "11 It is thus clear that on transfer or assignment of a policy and on the requisite procedure being complied with, the assignee alone has an absolute interest in the policy. The insurer was bound by the provisions of Section 38 to accept such a transfer or endorsement. The only limitations placed on transferring a policy were in terms of the procedure laid out in Section 38, and subject to the terms of policy itself. The Section left no scope for the insurer to dispute the right to transfer or assign the policy. Section 38 was thus clearly mandatory and substantive. The erstwhile Section 39(4) also deserves reproduction in this vein, as it further indicated the mandatory character of Section 38. It reads thus:

(4) A transfer or assignment of a policy made in accordance with Section 38 shall automatically cancel a nomination:

Provided that the assignment, of a policy to the insurer who bears the risk on the policy at the time of the assignment, in consideration of a loan granted by that insurer on the security of the policy within its surrender value, or its reassignment on repayment of the loan shall not cancel a nomination, but shall affect the rights of the nominee only to the extent of the insurer's interest in the policy.

41. The Hon'ble Apex Court further in the matter of Life Insurance Corporation of India Vs Dravya Finance Pvt. Ltd & Ors; 2023 INSC 815 also dealing with the provisions of unamended Section 38 of the Insurance Act vide para 9 has laid down that the assignment or transfer of policy is governed by statutory provisions in the form of section 38 of the Insurance Act. It has further been laid down that if the law requires a particular thing to be done in a particular manner, it must be done in that manner and not in any other manner.

42. Thus, in terms of the provisions of unamended Section 38 of the Insurance Act, 1938 read with Section 68 of the Indian Evidence Act and as per the authoritative judgments as passed by the Hon'ble Apex Court (Supra), the plaintiffs have failed to prove the endorsement which purports to effect assignment of beneficial rights and interests in the policy in question in accordance with law. Accordingly, since the mandate of unamended Section 38 of the Insurance Act is substantive law and since the plaintiffs have failed to prove the execution of the P-2 i.e endorsement form purporting to effect CS No. 4195/2017 Vedha Chopra vs. Life Insurance Corporation of India and ors Page no. 27/36 assignment of all the rights, title and interests in the policy in question, in accordance with the provisions of Section 68 of the Indian Evidence Act, no complete and effectual assignment can be said to have been effected in the beneficial rights and interests in the policy in question in favour of Plaintiff No

1. The assignment of the Policy in question in the present case never was completed nor the execution of the same stands proved for want of the testimony of the attesting witness who alone could have proved its execution.

Accordingly, this issue is decided against the plaintiff and in favour of the defendants.

Issue no. 2 : Whether the said endorsement was required to be presented for assignment and said assignment was to be registered in the records of Life Insurance Corporation OPD 1

43. The onus to prove the said issue was upon the defendant no 1. Plaintiffs have relied upon the testimonies of PW-2, D4W1 and D5W1 and have stated that after the execution of the Endorsement Form of the policy in question by Defendant No 3, the same was handed over to Defendant No 2 for getting the same registered. Defendant No 2 returned the original policy bond along with the endorsement form duly stamped. Ex P-2 contains the stamp of the Branch office of Defendant No 1. Thus the Plaintiffs have been able to successfully shift the onus of proof upon the Defendants by proving on record the Stamp/ Seal of the Branch Office of Defendant No 1. The onus of proof having shifted, now it was for Defendant No 1 to prove that they had not received any notice of the assignment having been made in favour of Plaintiff No 1. Defendant no. 1 during the proceedings of the suit has not led the evidence of any person to prove the fact that in fact the stamp on Ex. P2 is not the stamp of the Branch Office of Defendant No 1. The insurance policy i.e. Ex. P1, clearly mentions vide clause 9 that the notice of assignment or nomination should be submitted for registration to the office of the corporation where the policy is serviced. The endorsements form of the policy in question (Ex. P2), bears the stamp of the LIC (Branch 320, Asaf Ali Road, New Delhi-110002). No testimony of any CS No. 4195/2017 Vedha Chopra vs. Life Insurance Corporation of India and ors Page no. 28/36 witness has been led which goes to show that the aforesaid stamp of the branch of the LIC is forged or fabricated. Although a suggestion has been given by Defendant No-1 to D2W1 in the cross examination that the stamp affixed on Ex P2 is the personal stamp of Defendant No. 2, however no evidence corroborating the said fact has been proved by Defendant No -1 nor Defendant No-1 has proved that the stamp affixed is not of the Branch office of Defendant No 1. The aforesaid stamp in its round shape also is affixed upon the notorial stamps. Defendant no. 2 who has admitted that he is attached to the LIC Branch of Asaf Ali Road, New Delhi-02 i.e Branch No 320. D2W1 who was the agent of the LIC in his cross-examination has stated that he is not aware as to how the seal of LIC was affixed on the endorsement. He has further admitted that the seal is of the address of the branch of LIC. Defendant no.2 at no place has stated that the stamp of the LIC Branch of Asaf Ali Road, Delhi-02 was either forged or fabricated. Thus the Plaintiffs have been able to prove that notice of assignment was in fact given to the branch of Defendant No 1 i.e Branch No 320. Hence in view of the same it can be said that the endorsement of the policy in question was presented for assignment. Defendant No 1 has not produced on record any record/ document/ register of receipt of communications to prove that during the relevant period of time, the Branch Office of Defendant No 1 had not received the endorsement notice of assignment. Since, the endorsement of assignment as held in Issue no. 1 was not a valid assignment in accordance with the unamended provisions of Section 38 of the Insurance Act, 1938, defendant no. 1 was under no obligation to register the assignment in favour of plaintiff no. 1. The present issue is accordingly decided.

Issue no. 3 : Whether the suit is bad for mis joinder of defendant no. 2? OPD 2

44. The onus to prove the said issue was upon the defendant no. 2. Defendant no. 2 neither in the written statement nor in the evidence as filed of D2W1 any details as to how defendant no. 2 is not a necessary party and how the suit is CS No. 4195/2017 Vedha Chopra vs. Life Insurance Corporation of India and ors Page no. 29/36 bad for mis joinder of defendant no. 2. All throughout, it is the case of the plaintiff that the policy in question has been obtained by Late grandfather of the plaintiff on the advise of defendant no. 2 who had in his own handwriting had written the terms of the assignment and had obtained the commission for getting the insurance policies issued. The plaintiffs in their suit have also sought in the alternative relief against defendant no. 2 alleging negligence on the part of Defendant No 2 who is thus a necessary and a proper party. Thus, the present issue is decided in favour of the plaintiffs and against the defendants.

Issue no. 4 : Whether the plaintiff is entitled for reliefs as claimed in prayer clause? OPP

45. The onus to prove the said issue was upon the plaintiff. In the suit, the plaintiff has claimed the following reliefs :-

A) Pass a decree of Declaration in favour of the plaintiff and against the defendants no. 1 to 3 thereby declaring that the plaintiff being the actual beneficiary is entitled to the complete maturity amount under the policy no.

122024977 issued by the defendant no. 1duly endorsed/assigned in favour of the plaintiff by the defendant no 3.

C) Pass decree of permanent injunction in favour of the plaintiff and against the defendant no. 1 thereby restraining the defendant no. 1 from releasing or transferring the maturity amount under the policy no. 122024977 Issued by the defendant no. 1 in favour of the defendant no. 3 or any representatives/ assigns or other person claiming on his behalf.

In the alternative, it has been prayed as follows :-

D) Or in the alternative pass a decree for a sum of Rs. 34,00,000/- (Rupees thirty four lacs) being the maturity amount with all the other benefits of the CS No. 4195/2017 Vedha Chopra vs. Life Insurance Corporation of India and ors Page no. 30/36 policy number 122024977 in favour of the plaintiff and against defendants no.

1-3 along with pendente lite interest @18% per annum from the date of filing till realization.

46. As stated on the findings of issue no. 1 the Plaintiffs have failed to prove the assignment of all the rights, title and interests by way of gift in the Policy in question in favour of Plaintiff No 1 which neither was completed nor became effectual in the absence of the proof of its due execution for want of the testimony of the attesting witness. Thus since the assignment of a policy in question was never completed as mandated by law, the main reliefs i.e. the relief of declaration, permanent and mandatory injunction as sought by the Plaintiffs cannot be granted to them.

However the Plaintiff has claimed an alternative relief(s) as follows :-

"D) Or in the alternative pass a decree for a sum of Rs. 34,00,000/- (Rupees thirty four lacs) being the maturity amount with all the other benefits of the policy number 122024977 in favour of the plaintiff and against defendants no.

1-3 along with pendente lite interest @18% per annum from the date of filing till realization."

47. The alternative reliefs has been claimed by the Plaintiff on the ground that at the time of returning the policy bond after getting the assignment stamped at the office of defendant no. 1, defendant no. 2 had informed the grandfather and the mother of the plaintiff that the assignment of the policy in question has been carried out as per the procedure and was duly recorded in the records of defendant no.1. It has further been contended in the cause of action para that the cause of action arose on 10.06.2003 when the defendant no. 1 though affixed its office stamp on the policy bond but did not register the assignment in its records. It has further been contended that upon visiting the office of the branch of defendant no. 1 to claim the maturity amount with all other benefits, CS No. 4195/2017 Vedha Chopra vs. Life Insurance Corporation of India and ors Page no. 31/36 the plaintiffs were intimated that the assignment of the policy in question has not been registered in the records of defendant no. 1. The alternative relief thus has been claimed on the ground that there has been a deficiency of service and negligence on the part of defendant no. 2 who is the agent of Defendant No 1 in not getting the assignment properly recorded in the records of defendant no.

1. It has further been contended that defendant no. 1 being the principal of defendant no. 2 is responsible for the deficiency in services on the part of defendant no. 2. The plaintiff thus, claims the maturity amount of the policy in question i.e. Rs. 34 Lacs from defendant no. 1 and 2 jointly and severally alleging negligence and deficiency of services on the part of defendant no. 2 in not getting the assignment recorded/registered in favour of the plaintiff in the records of defendant no. 1. PW-2 in her examination-in-chief has stated that defendant no. 2 came to the residence of her father-in-law in June-2003 and wrote the contents of the assignment. She has not stated that either the endorsement was written by Defendant No 2 in her presence or the Defendant No 2 was handed over the Endorsement form of the policy in question in her presence. She has also not stated that the endorsement form containing the terms of assignment was executed by Defendant No 3 in her presence. She has further not stated that Defendant No 2 returned the endorsement form to her father in law in her presence. In her cross examination she has stated that she do not recollect the exact date on which the insurance policy was taken to the office of the LIC for stamping. PW-2 however, in her cross-examination has stated that the endorsement was made in the year-2002 and the policy bond was given to her after endorsement after a few days. She has further deposed that Ex. P-1 i.e. Insurance policy was given by her father-in-law to her in the presence of the other defendants. Thus, she has not stated that the original policy bond was handed over by her father in law to Defendant No 2 in her presence nor she has stated that it was handed over by defendant no. 2 to her father-in-law in her presence. Thus, the stand of PW-2 is clearly contrary to her deposition made in the examination-in-chief since as per the same, the CS No. 4195/2017 Vedha Chopra vs. Life Insurance Corporation of India and ors Page no. 32/36 endorsement was written by defendant no. 2 in the second week of June,2003 whereas in her cross examination she has stated that it was made in the year 2002.

48. Defendant No 4 and 5 have supported the case of the Plaintiff. Defendant no. 4 has stated in her examination in chief that defendant no. 2 wrote the contents of assignment in the presence of plaintiff no. 2, defendant no. 3, 5 & herself. Admittedly Plaintiff No 2 has not stated anywhere that the contents of assignment were written by Defendant No 2 in her presence. However D4W1 has not stated as to on what date defendant no 2 took the original policy bond for registration of the assignment and on which date the same was returned to her husband or as to whether she had witnessed the handing over of the Policy Bond by her late husband to Defendant No 2. She has further not stated that at the time of handing over of the original policy bond to her husband, any assurance had been made to plaintiff no 2 as deposed by her contrary to the deposition made by plaintiff no 2 or that PW2 was present. In her cross examination she has stated that she do not remember the date or after how much time the policy was returned after alleged registration. Thus in the wake of the aforesaid testimony it cannot be said that she has witnessed the handing over of the policy bond to Defendant No 2 nor it can be said that the said insurance policy was returned by Defendant No 2 to her husband in her presence.

49. Defendant no. 5 has stated that defendant no 2 had written the contents of assignment in favour of Plaintiff No 1 in his own handwriting in the presence of her late father, Plaintiff No 2, Defendant No 4 and herself. Admittedly Plaintiff No 2 has not stated anywhere that the contents of assignment were written by Defendant No 2 in her presence. D5W1 further stated that Defendant No 3 had signed the endorsement in the presence of her late father, Plaintiff No 2, defendant No 4 and herself. However Plaintiff No 2 has clearly stated in her examination in chief that Defendant No 3 had signed the endorsement in the presence of her father in law, Defendant No 4 and CS No. 4195/2017 Vedha Chopra vs. Life Insurance Corporation of India and ors Page no. 33/36 Defendant No 5. Thus there is a material contradiction in the testimony of D5W1. It is further stated by D5W1 that defendant no 2 took the original policy bond for registration and the same was returned to her late father after some days. However, she has not stated that the original policy bond was taken by Defendant no 2 in her presence or the same was returned by defendant no 2 also in her presence. In her cross examination she has stated that the assignment was done after the second and last premium was paid. Admittedly the Second and last premium of the policy in question was paid in December 2003 in terms of Ex PW 1/3. This version of Defendant No 5 is clearly contradictory to the stand of the Plaintiff in the suit wherein she has stated in the cause of action para that the cause of action arose on 10.06.2003 when the defendant no. 1 though affixed its office stamp on the policy bond but did not register the assignment in its records. D5W1 has clearly admitted that she does not remember the date or time the policy and assignment was taken by defendant no 2 but has further stated that it was taken after December 2003. The said answer too is clearly contradictory to the stand of the Plaintiff in the Plaint wherein she has stated that the cause of action further arose on 10.06.2003 when the defendant no. 1 though affixed its office stamp on the policy bond but did not register the assignment in its records. A specific question was put to D5W1 as to the date, month or year defendant no 2 returned the original policy bond to which she replied that it was before December 2003. She has further specifically stated that defendant no 2 returned the original policy bond before December 2003 and the original policy bond was handed over to plaintiff no 2 in July 2003. Thus as per the testimonies of the D5W1, Plaintiff No 2 was handed over the Policy Bond in question in July 2003 who alone was in possession of the same. As per the testimony of D4 W1, Plaintiff No 2 was not residing with the Late Sh I K Chopra or Defendant no 4 who after the demise of her husband was residing in her parental house. Defendant no 4 & 5 have also not stated that it was in their presence that defendant no 2 had taken the endorsement of the insurance policy CS No. 4195/2017 Vedha Chopra vs. Life Insurance Corporation of India and ors Page no. 34/36 for registration and also that the same were returned by defendant no 2 to late Sh. I K Chopra also in their presence. None of the witnesses are able to specify the date on which defendant no 2 had taken the original policy bond for registration of the assignment with defendant no 1 or on which date the same was returned to late Sh. I K Chopra. Thus in the considered opinion of the court the Plaintiffs have failed to prove the fact that in fact Defendant No 2 was handed over the endorsement form of the policy in question and the same was returned by Defendant No.2 after getting the stamp of Defendant affixed thereupon. As per the testimony of PW2, the endorsement was made in the year 2002. D4 W1 has stated that she do not remember the date or after how much time policy bond was returned after alleged registration. As per D5W1, she did not remember the date or time when the policy and assignment was taken by Defendant No 2 but she has stated that it was taken after December 2003.

50. On the other hand DW 2 has clearly stated that he has written the terms of the assignment on the endorsement form in favour of the plaintiff by defendant no 3 on the asking of late Sh. I K Chopra. In the cross examination he has denied that the original policy bond after signature on the endorsement of the life assured and notice of assignment was handed over to him. It is stated by defendant no 2 that after receiving the renewal premium for the first time, Sh. I K Chopra had asked him not to visit him for further renewal and also that he would get it done himself since some family disputes were going on. He has specifically denied that he is not aware as to how the seal of the LIC was affixed on the endorsement. D2 W1 has specifically denied that he had taken the original policy for registration of the endorsement with the LIC. Not even a suggestion has been put to D2 W1 to the effect that he was handed over the endorsement form of the policy in question containing the terms of the assignment in the presence of any witness nor a question has been put to the said witness as to whether the endorsement/assignment after stamping has been returned by him to Sh. I K Chopra in the presence of any of the defendants or CS No. 4195/2017 Vedha Chopra vs. Life Insurance Corporation of India and ors Page no. 35/36 the plaintiffs. Thus the plaintiffs have failed to prove that the defendant no 2 was in fact handed over the duly executed assignment, endorsed on the policy in question or that the same was returned by defendant no 2 to late Sh. I K Chopra after affixation of the stamp of Defendant No 1. Since no valid assignment could be said to have been proved, hence defendant no 1 was under

no obligation to register the same in its records. Accordingly since the plaintiff have failed to prove either the valid assignment of the Policy in question in favour of Plaintiff No 1 for want of the testimony of the attesting witness nor the Plaintiffs have been able to establish that Defendant No 2 was handed over the original policy bond in question or return of the same after the affixation of stamp of Defendant No 1, thus the Plaintiffs are not entitled to the alternative relief as prayed for.

51. The suit as filed by the plaintiff is hereby dismissed.

52. No order as to cost.

53. Decree sheet be prepared accordingly.

54. File be consigned to record room after necessary due compliance.

Announced on 30th May, 2025 Sachin Sood DJ-01, Central THC, Delhi (Judgment contains 36 pages) Digitally signed SACHIN by SACHIN SOOD SOOD Date: 2025.05.30 16:26:48 +0530 CS No. 4195/2017 Vedha Chopra vs. Life Insurance Corporation of India and ors Page no. 36/36

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Vedha Chopra vs Life Insurance Corporation Of India And ... on 30 May, 2025