State Consumer Disputes Redressal Commission
Smt.K.Sarojamma vs Lic Of India on 10 January, 2008
DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, ANANTAPUR DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, ANANTAPUR PRESENT:- Sri M.Subbarayudu Naidu, B.Com., B.L., President-Incharge Smt.S.Lalitha, M.A., M.L., Member, Thursday, the 10th day of January, 2008 C.C.No.74/2007 Between: Smt.K.Sarojamma W/o Late K.Konda Reddy D.No.1-153, Teachers Colony Pamidi Village & Post, Anantapur District. Complainant Vs. 1. LIC of India, by its Branch Manager Tadipatri Branch, Railway Feeder Road, Tadipatri, Anantapur District. 2. LIC of India, by its Senior Divisional Manager, College Road, Kadapa. Opposite parties This complaint coming on before us for final hearing on 08-01-2008 and upon perusing the complaint, written version and other relevant material papers on record and on hearing, Sri K.Siddaiah, counsel for the complainant and Sri V.Krishna Sharma, counsel for the opposite parties 1 & 2 and having stood over till this day for consideration, this Forum made the following: O R D E R
Delivered by Sri M.Subbarayudu Naidu, Incharge President on behalf of the Bench:-
1. This complaint is filed under section 12 of Consumer Protection Act, 1986, to pass an order directing the opposite parties to pay the accident benefit amount covered under the two Insurance Policy Nos.071845414 and 651705297 with interest @ 12% , to pay a sum of Rs.10,000/- towards deficiency in service and negligent attitude of the opposite parties, to pay a sum of Rs.10,000/- towards compensation for mental agony suffered by the complainant and to award the costs of the complaint to the complainant.
2. The factual matrix leading to the filing of this complaint is set out as hereunder:-
(a) Case of the complainant is that she is wife of late Kopparala Konda Reddy. She is the resident of Pamidi Village in Anantapur District. The said Konda Reddy was murdered on 04-06-2001. During his life time on 28-04-1985, he took an Insurance Policy bearing No.071845414 Jeevan Mitra Double Cover Endowments Assurance Policy for Rs.50,000/- from LIC of India, Branch, Tadipatri ( i.e. O.P.No.1) and again on 08-11-1995 he took another Insurance Policy bearing No.65175297 Jeevan Mitra Double Cover Endowment Assurance Policy for Rs.50,000/- from the LIC Branch, Tadipatri (O.P.1). He had paid the required premium and the 1st opposite party has accepted the proposal and issued the said two Policies to late K.Konda Reddy.
The said Konda Reddy had appointed the complainant herein as his nominee under the above said two policies. The original policies are kept with the 1st opposite party.
(b) The above said policy-holder late K.Konda Reddy worked as a High School Teacher and subsequently, he was promoted as Mandal Educational Officer at Yadiki. He had paid the premiums regularly till the date of his death. Before entering into the said Policies, the health condition of late Konda Reddy was verified by the concerned doctor and after verification about his antecedents and having satisfied with the required formalities of the assured, the 1st opposite party has issued the policies in his name. The said insured Konda Reddy had appointed his wife i.e. the complainant herein as his nominee in both the policies. On 04-06-2001 as usual the above said Konda Reddy went for his morning walk on Pamidi- Yeddulapalli Road alongwith one of his brother at about 6.00 A.M. While he was proceeding near Mango Garden of Kumara Mallanna, his opponents suddenly came and attacked him with hunting sickles and beat indiscriminately and when Govinda Reddy and Pulla Reddy tried to go to rescue Konda Reddy, the assailants threatened them and scared them away. Konda Reddy, who was groaning with bleeding injuries was shifted in a Jeep to the Head-Quarters Hospital at Anantapur. But he died before he was admitted in the hospital. Konda Reddys brother Govinda Reddy gave complaint before the Police and the same was registered as Crime No.36/2001 of Pamidi P.S. u/s 147, 148, 302 r/w 149 I.P.C. The said case was committed to Sessions Court, Gooty. The said case was tried as S..C.No.422/2002 in the Court of the VI Additional Sessions Judge Court, (VI Fast Track Court), Gooty on 09-02-2005, the judgment was pronounced and the accused A1 to A9 were convicted and sentenced for 7 years rigorous imprisonment each. The certified copy of F.I.R. in the above said crime No.36/2001 of Pamidi P.S., the post-mortem certificate of deceased Konda Reddy and copy of the judgment in S.C.No.422/02 dt.09-02-2005 are filed alongwith the complaint.
The deceased Konda Reddy was not a factionist. His native place was Dimmagudi in Peddavaduguru Mandal. After joining as a High School Teacher, deceased Konda Reddy left his native place Dimmagudi about 20 years back and came over to Pamidi and settled his family at Pamidi. At Dimmagudi Village, there was faction between Adinarayana Reddy @ Adi Reddy (eldest brothers son of deceased Konda Reddy) and Madireddy Prathapa Reddy. Suspecting that the said Konda Reddy was supporting Adi Reddy as against them, Prathap Reddy and his men have way laid and murdered Konda Reddy on 04-06-2001, when he went for morning walk on Yeddulapalli Road, even-though Konda Reddy has nothing to do with the faction in Dimmagudi Village. After the death of her husband, Konda Reddy, the complainant herein being his nominee in the above said two policies made claim before the first opposite party. The 1st opposite party has settled the death claim in the two policies, but the Branch Manager of the 1st opposite party took objection for the claim of the Double Accident Benefit and did not pay the claim under the death accident benefit covered under the policies to the complainant. The complainant made several representations to the opposite party Nos.1 and 2 requesting them to settle the claim, but the opposite parties went on delaying the matter on some pretext or the other. On 11-04-2005, the 2nd opposite party sent a letter to the complainant stating that they have decided to repudiate all the liability under the said two policies i.e. (1) 651705297 and (2) 071845414 since the assured has committed breach of law involving himself in the illegal activities and was murdered. So, the reasons given by the 2nd opposite party for repudiation of the claim are against law. Again the complainant had sent a representation to the LIC, South Central Zonal Office, Hyderabad on 30-04-2005 requesting to consider her claim for the accidental benefit. The said South Central Zonal Office, Hyderabad vide letter dt.17-05-2005 has sent a letter to the complainant stating that they were calling for the records from Kadapa Divisional Office, to place it before the Zonal Claim Review Committe for its consideration and decision and the decision of the Zonal Review Committee will be communicated to the complainant in due course of time. The said letter dt.17-05-2005 is filed for our perusal for a decision.
(d) After a lapse of 4 years, the Senior Divisional Manager, LIC, Kadapa (i.e. 2nd opposite party) sent a letter dt.08-09-2005 to the complainant informing that they have repudiated the double accident benefit claim under the said two policies. According to the complainant that her husband was not involved in any illegal activities, he was employed as Mandal Educational Officer and holding the post on the date of death also and if he had involved in any illegal activities as alleged by the opposite parties, he would have been removed from the service of State Government. The opposite parties in order to escape their liability to pay the accident policy, they have made false allegations against the deceased that he was involved in illegal activities. The opposite parties are causing trouble and annoyance to the complainant. The complainant is an old and sickly woman and on account of the negligence and deficiency in service of the opposite parties, she is suffering mental agony. Hence, this complaint is filed against opposite parties herein.
3(a) The complaint was contested by the opposite parties by filing written version. A memo was filed on behalf of the opposite party No.1 adopting the written version of the 2nd opposite party. The chief affidavits of the complainant and the 2nd opposite party were filed on 24-08-2007. In the objections, in the written version filed on behalf of the 2nd opposite party while denying the material averments made in the complaint it is interalia stated that the alleged murder of the deceased on 04-06-2001 due to rivalry and immoral activities and the death of the policy holder is not an accidental death. Since the death of the life assured was murdered due to committing breach of law and involving in immoral activities, the contracts have become null and void and nothing is payable under the above said policies. According to the 2nd opposite party, the deceased life assured had taken two insurance policies with the 1st opposite party and nominated his wife Smt.K.Sarojamma (complainant) as nominee under the said policies and the details of each policy submitted hereunder:
Sl.No. Policy No. DOC SA P & T Remarks
1.
71845414 28-04-85 50,000/-
75-20 BSA + Bonus of Rs.1,19,575/- was paid on 31-07-2001.
2. 651705297 08-11-95 50,000/-
88-20 BSA + ASA+Bonus of Rs.101519/- was paid on 31-07-2001.
(b) The above said polices are with accident benefit policies and accident benefit will be paid provided the claimant proves to the full satisfaction of the opposite party corporation that the life assured died accidentally and occurrence of accidental death is proved by indisputable proof like police reports etc., The accident benefit is governed by the policy condition 10(b) of the policy bond. The contents of the policy condition 10(b) are as stated hereunder:-
Clause 10(b) of the policy: Death of life assured:- To pay an additional sum equal to the sum assured under the policy, if the life assured shall sustain any bodily injury resulting solely and directly from the accident caused by outward, violent and visible means and such injury shall within 120 days of its occurrence solely, directly and independently of all other causes result in the death of the life assured. But the Corporation shall not be liable to pay the additional sum referred in (a) or (b) if the disability or the death of the life assured shall, (i) be caused by intentional self injury attempted suicide insanity or immorality or whilst the life assured is under the influence of intoxicating liquor, drug or narcotic; or (iv) result from the life assured committing any breach of law or In the judgment delivered by the Honble VI Additional Sessions Judge, Gooty in S.C.No.422/2002 dt.09-02-2005, the learned Honble Judge found that irrespective of the faction or other-wise P.Ws1. and the deceased (deceased life assured) were involved in a criminal case, whereas they outraged the modesty of Sridevi wife of A4 So in the various circumstances that were just referred above particularly PW1 and the deceased and Adinarayana Reddy insulted the wife of A4 and that it is also one of the strongest circumstances that the accused without any pre-plan on the next day attacked the deceased. the copy of the judgment in the above said case is enclosed for our perusal. Further, according to the opposite parties that it is evident from the said judgment that the deceased life assured was indulging in a immoral activities and it is the strongest circumstance for the murder of the deceased life assured. So, accident benefit claim is not payable as per the policy conditions of clause 10(b) (i) and (iv) . Hence, the 2nd opposite party repudiated the accident benefit claim by invoking policy clause No.10(b)(i) and (iv) under the above policies by their registered letter dt.11-04-2005. The copy of the repudiation letter addressed to the complainant filed for our perusal.
As per the advise of the 2nd opposite party, the complainant made an appeal to the higher office of the 2nd opposite party. But on scrutiny and thorough verification of the case, the higher office of the opposite parties, upheld the decision of the 2nd opposite party and it was communicated to the claimant on 08-09-2005. As such, there is no deficiency in service on the part of the opposite parties and the question of payment of accident benefit claim for mental agony, interest and compensation does not arise. So, the complaint may be dismissed with costs.
4. In support of the averments made in the complaint, the complainant filed her chief affidavit. The complainant also filed 10 documents, which are marked as Ex.A1 to A10.
Ex.A1 is the copy of payment of claim sent to LIC, Division, Kadapa dt.28-07-2001. Ex.A2 is the Xerox copy of the policy bearing No.651705297 issued by LIC of India, Tadipatri Branch.
Ex.A3 is the copy of status report of policy bearing No.071845414 dt.14-06-2006 issued by LIC of India, Division, Kadapa. Ex.A4 is the original letter dt.11-04-2005 issued by the 2nd opposite party addressed to the complainant. Ex.A5 is the letter dt.30-04-2005 addressed to the Zonal Manager, South Central Zonal Office, LIC of India, Saifabad, Hyderabad by the complainant. Ex.A6 is the Xerox copy of the letter dt.17-05-2005 addressed to the complainant by the Zonal Manager, LIC of India, S.C. Zonal Office, Saifabad, Hyderabad. Ex.A7 is the original letter dt.08-09-2005 addressed to the complainant by the Senior Divisional Manager, LIC of India, Kadapa repudiating the claim under policy bearing Nos.71845414 and 651705297. Ex.A8 is the Xerox copy of FIR in crime No.36/2001 of Pamidi P.S. Ex.A9 is the Xerox copy of Post-mortem Certificate of late Konda Reddy and Ex.A10 is the certified copy of judgment in S.C.No.422/02 on the file of the Senior Civil Judges Court, Gooty.
5. In support of their case in the written version, the opposite parties filed 3 documents, which are marked as Ex.B1 to B3. Ex.B1 is the original policy bearing No.651705297 dt.18-11-1995 issued by the Branch Manager, LIC of India, Tadipatri (1st opposite party) in the name of the deceased K.Konda Reddy. Ex.B2 is the original letter dt.11-04-2005 by Registered Post Acknowledgment due, addressed to the complainant by the 2nd opposite party and Ex.B3 is the attested copy of the Judgment in Sessions case No.422/2002 on the file of the VI Addl. Sessions Judge, Gooty.
6. On behalf of both sides, written arguments were not filed, but the written arguments of the opposite parties in C.C.No.73 of 2007 on the file of this Forum filed, hence, the same is considered to this consumer case also. We have heard the oral arguments of counsels of both the sides. Both the parties have filed affidavits in support of their case and also produced the documents, which are marked as exhibits.
7. On the basis of the pleadings and documentary evidence, the points that arise for determination are:-
(1)Whether there is any deficiency in service on the part of the opposite parties 1 & 2 towards the complainant?(2)
Whether the complainant is entitled for the reliefs as prayed for ? If so, to what extent ?
(3)To what relief ?
8. POINT NO.1: (a) The basic facts are not disputed and hence they are not reproduced. Admittedly, the husband of the complainant had taken two Insurance Policies from the 1st opposite party. The analysis of this Consumer Case instead of providing answers to the dispute, raises many questions. Ex.A2 and Ex.B1 are one and the same, relating to the Policy bearing No.651705297 in the name of the deceased K.Konda Reddy. Ex.A1 is the payment of claim of another policy bearing No.71845414 on the life of K.Konda Reddy. Both the policies class of assurance namely Jeevan Mitra (Double Cover Endowment Plan) with profits with accident. With regard to event on the happening of which sum assured payable on the stipulated date of maturity if the life assured in them alive or at his death if earlier. Unfortunately, the husband of the complainant herein was murdered on 04-06-2001. The opposite parties took serious objection for payment of accident benefit under the above said policies on the ground that having indisputable proof to show that the life assured committed breach of law by involving himself in illegal activities and was murdered. Hence, the accident benefits are rejected as per the policy conditions and privileges 10(b)(i) and (iv). According to Ex.A7, on 08-09-2005, the 2nd opposite party informed to the complainant by saying that death claim repudiated after review by LIC Zonal Office, Hyderabad.
(b) Very interesting law point that has arisen in this complaint that murder is not an accident according to the opposite parties version. They relied upon this statement because as per Ex.A10 i.e. copy of the judgment in S.C.No.422/2002 on the file of VI Additional Sessions Judge, Gooty. The Honble judge in that Sessions case observed and remarked that irrespective of the faction or other-wise PWs1 and the deceased (life assured) were involved in a criminal case, whereas they outraged the modesty of Sridevi wife of A4.. so in the various circumstances that were just referred above particularly PW1 and the deceased and Adinarayana Reddy insulted the wife of A4 and that it is also one of the strongest circumstances that the accused without any pre-plan on the next day attacked the deceased.
This is one of the reasons for the opposite parties to make good defence and took shelter as per the policy conditions clause 10(b)(i) and (iv), the opposite parties shall not be liable to pay the additional sum referred in
(a) or (b) if the disability or the death of the life assured shall (i) because by immorality; (iv) result from the life assured committing any breach of law; or Basing on these aspects, the opposite parties repudiated the claim of the complainant with regard to additional sum assured to the deceased. The opposite parties co-related the judgment of Sessions Court to the Policy conditions Clause 10(b) (i) and (iv) and thereby repudiated the claim.
9. The point for consideration is to determine the deficiency in service on the part of the opposite parties, can it be lawful and permitted to consider the observations and remarks made by the learned Honble Judge in Sessions Court in another case, to take into consideration while disposing of this consumer case and equated it on merits is the question for our perusal for a decision. The law is very clear. A case in law is a collection of facts. Jurisprudentially, the observations and remarks of a judge are called obiter dicta, i.e. observations by the way, and are not binding. Obiter dicta is purely suggestive of the trend of courts thinking Dr.Goodhart defines - Obiter dictum as a conclusion based on a fact the existence of which has not been determined by the court. That is the position of law as it stands now. The opposite parties relied on them and proceeded, finally repudiated the claim, stating the reasons for arriving at their conclusion.
10. The learned counsel Sri K.Siddaiah appearing for the complainant vehemently argued before us submitting plethora of decisions of National Commission and A.P.State Commission in support of his case stating that under circumstances of the case, murder is an accident and the complainant is entitled all the reliefs as prayed. In that process, the said learned counsel referred to us a decision reported in 1998(3) CPR 5 (NC) case Smt.Manda Savarna Vs. The Branch Manager, LIC of India and another, their Lordships held that the death of insured was accidental and complainant was entitled to double benefit of accident under the policy. He also cited another decision of our A.P.State Commission, Hyderabad, which reported in 2005(1) C.P.R. 329 = 2005(3) A.L.T. 6 (CPA) Case: Aravapalli Omkaram Vs. United India Insurance Co. Ltd., their Lordships held that where insurance policy-holder was kidnapped and murdered, insurance company could not avoid its liability on a plea of clause in the policy that only when death was caused by violent and visible means, it could be held liable as death resulting from such events could be deemed to be an accident. The said learned counsel further also referred another decision during his arguments that a case reported in 2000 ACJ 343 National Insurance Co. Ltd., Vs. Presiding Officer, Labour Court and others wherein the High Court of Patna, Ranchi Bench held that accident includes murder. He also cited another decision of our A.P.State Commission, Hyderabad reported in 2000(i) A.L.D.( Cons.) 42, wherein it was held that burden lies on the Insurance Company to prove the exceptions and the death occurred solely due to an accident caused by external violence. So, the Insurance Company is liable to pay.
11. On the other hand the learned counsel Sri V.Krishna Sharma, appearing for the opposite parties 1 & 2 also vehemently argued before us, referring Supreme Court decision and National Commission and A.P.State Commission decisions in support of his case.
First of all, he referred to us a decision of Supreme Court reported in 2000 A.C.J., 409 Case: Rita Devi and others Vs. New India Assurance Co. Ltd., and another, wherein it is held that if the domant intention of the act of felony is to kill any particular person then such killing is not an accidental murder but is a murder simplicter where if the cause of murder or act of murder was originally not intended and the same was caused in furtherance of any other felonious act then such murder is an accidental murder. : Another decision reported in 2006 C.T.J. 983 (CP) (NCDRC) Case is that Prithvi Raj Bhandrai Vs. LIC of India Ltd., and others, wherein it was also held that If the dominant intention of the act of felony is to kill any particular person then such killing is not an accidental murder but is a murder simplicitor.
The said learned counsel also cited before us a decision of our A.P.State Commission reported in 2001(5) A.L.D. (Cons.) 13, the case is that Amit Casings Private Ltd., Hyderabad Vs. United India Insurance Company Ltd., and others, wherein their Lordships held that condition of the policy prescribing a period of limitation of twelve months from the date of repudiation claim made beyond the said twelve months can not therefore be entertained. He also referred a decision of our Supreme Court, which was reported in AIR 1962 SC 814 the case is that Mithoolal Nayak Vs. LIC of India, wherein it also held that the policy holder was clearly guilty of a fraudulent suppression of material facts.
12. On perusal of documentary evidence on record and hearing the arguments of the learned counsel for both sides and considering the facts and question of law and circumstances of the case, while the Forum/Court is exercising sovereign function of dispensation of justice, it is worthwhile to remember once that the proceedings before the Consumer Fora are inquisitorial and not adversary. The orders are required to pass in accordance with justice and equity on the basis of the evidence available on record. Primarily, the C.P.Act, 1986, is for the protection of the consumers and matters are required to be decided by having rationale approach and non-technical one that is the mandate of law. This is made clear in Indian Photographic Co.
Ltd., Vs. H.D. Shourie, VII (1999) SLT 86 = (1999) 6 S.C.C. 428.
In order to arrive at a correct decision of this Consumer Case, it is relevant and an appropriate to recapitulate the intention of the Legislature by referring some of the decisions rendered by various courts on the present subject.
(a) Insurance Company is bound by contract once it has accepted premium 2005 (2) C.P.R. 586.
(b) Insurance claim is to be settled within two months of submission of material documents other-wise insured is entitled to interest @ 9% on awarded claim amount 2005(2) C.P.R. 640.
In AIR 2001 SC 1213 it was held that no court ought to base its decision on technicalities alone.
(d) In 2002(4) SCC 388 at para 41, it was held that the role of judiciary is merely interpret and declare the law was the concept of a bygone age, it is fairly the settled concept that courts can so mould and lay down the law formulating principles and guidelines to adopt and adjust to the changing conditions of society in dispensation of justice.
(e) Cause of action in Insurance cases arises on the date of repudiation but not on the date of accident 2005 (2) C.P.R. 122 (NC).
(f) If any wrong has been committed by the employee of the opposite party, then it is for them to recover the amount by holding enquiry, as laid down by the Honble Supreme Court in the case of Lucknow Development Authority Vs.M.K.Gupta A.I.R. 1994 S.C. 787.
(g) Ghaziabad Development Authority Vs. Balbir Singh II 2004 C.P.J. 12 S.C. = 2004 (5) SCC 65, the Apex Court has held that the Consumer Forums could grant damages/compensation for mental agony/harassment where it finds misfeasance in public office. The court has held that such compensation is a recompense for the loss or injury and it necessarily has to be based on a finding of loss or injury and must co-relate with the amount of loss or injury.
(h) The provisions of law of limitation are not applicable where cause of action is continued 2000 II C.P.J. 254. The Law of Limitation is made in order to advance justice and not to punish the parties.
If there is pardonable excuse even long duration can be condoned 2005 (2) C.L.T. 586. The Consumer Protection Act, 1986 is a benevolent legislation intended to protect the interests of consumers so while construing the said provisions of limitation, Consumer Fora have to take a liberal view A genuine claim of a honest consumer should not be allowed to be defeated on the technical ground of limitation 2005 (1) C.P.J. 96.
13 (a) It is absolutely true that the principal function of the court is to adjudicate particular controversies between specific disputants. In each case, the court must support its conclusions by reference to reliance upon legal rules that comport adequately with the existing legal order. Even if there is no directly applicable legal rule, the court can not abdicate adjudication expressing helplessness. The court must fine tune, fashion, adjust or construct an appropriate rule to fit the controversy before it.
(b) Having the concept as stated above, keeping it in mind, this Consumer Case before us poses the various issues on question of fact and law as well. The complainant herein got initial amount after the death of her husband as per written version of the opposite parties on 31-07-2001. Since then, she is fighting endlessly till now, to get her accidental benefit sum assured as a legal heir nominee as per the policies mentioned above. It also supports and revealed through relevant documents marked as exhibits for both the sides. The concerned officers of the opposite parties took sufficient time to repudiate the claim of the complainant by way of a letter dt.08-09-2005 i.e. Ex.A7 showing the reasons for their conclusion. In this connection, it is opt to mention that the entire purpose of LIC was to see that such persons should get the assured amount in their difficult days and there is no harassment and delay in paying the amount to the insured or his nominee as the case may be or they are not required to spend in litigation. To avoid such litigation and its costs, officers of the LIC should keep in mind the observations of the Apex Court in the case of LIC of India Vs. Asha Goel (Smt) and another, 2001(2) SCC 160, that the approach of the corporation in the matter of repudiation of the policy, admittedly issued by it, should be one of extreme care and caution. It should not be dealt within a mechanical and routine manner. It is crystal clear to the naked eye that the umbrella of protection, which is sought by the complainant in this case denied by delaying tactics adopted by the Insurance Company. Simple meaning of accident is unforeseen and unexpected.
In R Vs. Morris (1972) IWLR 228, the court of Appeal defined the word as an unintended occurrence, which has an adverse physical result. The Apex Court of Canada in Pickford & Black Ltd., Vs. Canadian General Insurance Co., (1976) 2 Lloyds Rep. 108, stated the law thus:-
The meaning to be attached to the word accident as employed in the body of an insurance policy was thoroughly explored by Mr. Justice Pigeon in the reasons for judgment, which he delivered on behalf of the majority of this court in the The Canadian Indemnity Co. Vs. Walkem Machinery & Equipment Ltd., (1975) D.L.R. (3rd)
1. Even an occurrence which is the result of a calculated risk or of a dangerous operation may come within the meaning of the word accident. The learned Judge went on to say that while it is true that the word accident is sometimes used to describe unanticipated or unavoidable occurrence.
(d) The contention of the learned counsel for the complainant that as far as the deceased Konda Reddy is concerned, previously there is no any complaint against him recorded in any Police Station. There are no cases pending against him. He was a teacher. He was an Govt. employee. Subsequently, he was promoted as Mandal Educational Officer at Yadiki. He had paid the premiums regularly till the date of his death. The learned counsel for the opposite parties stressed much in his arguments for applicability of the position of Rule of Law as per his citations-authorities to the facts of the present case. Facts are altogether different. This is entirely different case. Hence, his arguments are not considered. But, we are convinced with the arguments of the complainant. The authorities cited by the complainant are relevant to decide this consumer case. We hold that repudiation of the claim is unjustified and hence the opposite parties herein are required to reimburse the complainant on the basis of loss. Since the complainant has been deprived of the use of money for which she is entitled to interest, which is quantified @ 9% p.a. Though, it is true that LIC is vested with the monies of the public as trustee, they have to safeguard and take all care and precaution before accepting a claim with a view to see that there is no unjust claim by person. But at the same time such reliefs should not be denied by placing too stringent construction of clauses or by insisting upon rigid proof of averments made in the complaint. Still, at the same time, where we find that the claim appears to be a bonafide one and there is nothing to show that there is a any tinge of doubt or suspicion, as far as possible, the claim should be honoured.
14. As far as the policy conditions are concerned, it is specifically stated in Ex.B1 that clause 10 Accident benefit:- (a) Disability to the life assured the maximum aggregate limit of assurance under all policies on the same life to which benefits (1) and (2) above apply shall not in any event exceed Rs.5,00,000/- . If there be more policies than one and if the total assurance exceeds Rs.5,00,000/- the benefits shall apply to the first Rs.5,00,000/- sum assured in order of date of the policies issued. (b) Death of the life assured: To pay an additional sum equal to the Sum Assured under this policy, if the Life Assured shall sustain any bodily injury resulting solely and directly from the accident caused by outward, violent and visible means and such injury shall within 120 days of its occurrence solely, directly and independently of all other causes result in the death of the Life Assured. However, such additional sum payable in respect of this policy, together with any such additional sums payable under other Policies on the life of the Life assured shall not exceed Rs.5,00,000/- Jeevan Mitra (Table No.88):- An Endowment Assurance Plan providing for twice or thrice the sum assured payable on the death of the life assured during the policy of the term. At the most, Insurance Company can be given 4 months time for settlement. Now the law is crystallized by passing the Insurance Regulatory and Development Authority (Protection of Policyholders Interest) Regulations, 2002, Regulation 9 provides the limit during which the claim of the insured is to be settled.
It gives step-by-step procedure and the maximum time limit does not exceed 5 -6 months as per the said procedure. For the delay in making payment, the insured should be adequately compensated. Clauses (1) to (4) of Regulation 9 prescribe the time limit during which the claim is required to be processed and finalized. Clause (6) of Regulation 9 specifically provides that if there is delay in payment, the Insurance Company shall pay the same with interest which is 2% above the Bank rate.
The relevant clause( 6) is as under:
Upon acceptance of an offer of settlement as stated in sub-regulation (5) by the insured, the payment of the amount due shall be made within 7 days from the date of acceptance of the offer by the insured. In the case of delay in the payment, the insurer shall be liable to pay interest at a rate which is 2% above the bank rate prevalent at the beginning of the financial year in which the claim is reviewed by it. The opposite parties herein repudiated the claim of the complainant under the policies bearing Nos.71845414 and 651705297 on 08-09-2005. In fact, it is due, since then to the complainant. The husband of the complainant died in the year 2001 in an accident-murder after obtaining policy in the year 1985 and 1995 respectively.
In Lucknow Development Authority case, the Apex Court held that the Consumer Protection Act is a welfare statute. Consumer Fora can award compensation for harassment by public authorities. It may result in improving the work culture and help in changing the outlook of the public authorities.
15. Onus of proof:-
As a general principle, the onus is on the insurers to prove that a condition has been broken, not on the assured to prove compliance on his part with each and every stipulation. If there is a question as to whether a contract of insurance has ever come into existence or begun to operative, the assured has to prove the happening of any events necessary to its existence or operation, but where the question is as to the insurers liability under an admittedly effective policy, the rule as to the burden of proof is axiomatic in Insurance Law.
In the present case, the opposite parties have not produced any evidence of substance to repudiate the claim of the complainant. We are unable to agree with the arguments of the opposite parties, which repudiated the claim without valid reasons. We also note the unconscionable delay on the part of the opposite parties in deciding the claim.
16 (a) The Consumer Law is all about protecting the interests of consumers. The entire purpose behind setting up the consumer courts was to provide quick, easy and affordable justice to common people, who could not other-wise enforce their rights before a court of law. The very purpose of this law is to provide inexpensive and easy access to justice to individual consumers, who can not afford to pay court fee or engage a lawyer to fight long and expensive legal battles in a civil court.
(b) A short question, which arises for our consideration is as to whether clause 10(b) (iv) of the alleged policy is applicable to the facts and circumstances of the present case. Having paid the sum assured, the opposite parties ought not to have withheld the accidental benefits relying on clause 10(b)(iv) of the above said polices, which states that accidental benefits can not be paid for any breach of law. In the present consumer case, the accident has already been established. The Insurance Company (opposite parties) is in fact under obligation to prove the breach of policy.
17. In these set of circumstances, it is apparent that there is negligence in discharging of duties by the opposite parties herein by showing irrelevant reasons and deficiency in service for which the opposite parties are required to pay adequate compensation to the complainant herein. In our view, this would amount to unfair trade practice which is required to be controlled by the higher ups such delay happened in this case not only frustrates the purpose of insurance policy but the insured may lose confidence in administration of the opposite parties and it ruins the insured or his nominee. An accident may ruin an entire family of the insured. We have followed the ratio decidendi of our A.P. State Commissions decisions as mentioned above i.e. 2005(3) A.L.T. 6 C.P.A. and 2000(1) A.L.D. (Cons.) 42 to decide this consumer case. In the case of Balbir Singh (as stated supra) interest was awarded by the Consumer Fora by way of compensation/damages. In this case, the Apex Court observed that while awarding interest, it must be shown that there is relationship between the amount awarded and the default/unjustifiable delay/harassment. The Apex Court held that the general provision of section 34 C.P.C. being based upon justice equity and good conscience would authorize the Redressal Forums and Commission also grant interest appropriately under the circumstances of each case. Interest may also be awarded in lieu of compensation or damages in appropriate cases.
The interest can also be granted on equitable grounds. No doubt, the Consumer Fora is required to exercise equitable jurisdiction so that harassed consumers do not suffer. The power is vested in the Consumer Fora for rendering justice and not for harassing. Justice delivery system by the Consumer Fora with utmost promptitude. We want to make this consumer case an exemplary case and eye-opener for every civic body, public authority, Government Organization etc., who are engaged in the service for the public at large and also who are duty-bound and have the obligations of maintaining service properly. Other-wise, they have to be dealt with strictly and punished for offence of deficiency in service as defined under section 2(1)(g) of the Consumer Protection Act, 1986. Section 14 of Consumer Protection Act, 1986 provides for adequate compensation would certainly mean that the complainant, who is deprived of the benefit, which she was entitled for years together, she should be adequately compensated. Measure for adequate compensation can be a lump-sum amount, may be a reasonable rate of interest by way of damages. We are satisfied that it is a fit case wherein we have to give the releifs to the complainant. All the exhibits marked on behalf of the complainant will clearly go to show that the claim of the complainant can be said to be totally justifiable under the circumstances of the case. So, there is clear cut deficiency in service on the part of the opposite parties.
This point is accordingly answered.
18. POINT NO.2: In view of the point No.1 as discussed above and taking all the aspects into consideration, we are of the opinion that it is just and reasonable to award a sum of Rs.2,00,000/- (Rupees two lakhs only) being the accident benefit amount covered under the two Insurance Policies Nos.071845414 and 651705297 payable on 08-09-2005 and thereafter interest at 9% p.a. should be calculated and Rs.3,000/- (Rupees three thousand only) towards costs of the complaint. We, therefore find that the complainant is entitled to the amount of Rs.2,00,000/- (Rupees two lakhs only) with interest at 9% p.a. from 08-09-2005 and Rs.3,000/- (Rupees three thousand only) towards costs of the complaint . This point is accordingly answered.
19. POINT NO.3: In the result, the complaint is allowed in part directing the opposite parties 1 & 2 to pay a sum Rs.2,00,000/- (Rupees two lakhs only) being the accident benefit amount covered under two Insurance Policies Nos.071845414 and 651705297 with interest @ 9% p.a. from 08-09-2005 till the date of realization and to pay Rs.3000/- (Rupees three thousand only) towards costs of the complaint to the complainant within six weeks from the date of receipt of copy of the order.
A copy of this order, as per the statutory requirements, be forwarded to the parties, free of charge. Copy be sent to all leading National Dailies, Press for apprising the insurance companies and its policy-holders about their rights and obligations.
Dictated to the Steno, transcribed by him, corrected and pronounced by us in open Forum on 10th day of January, 2008.
Sd/-
Sd/-
MEMBER PRESIDENT- INCHARGE DISTRICT CONSUMER FORUM, DISTRICT CONSUMERS FORUM, ANANTAPUR ANANTAPUR APPENDIX OF EVIDENCE WITNESSESS EXAMINED FOR COMPLAINANT :
NIL OPPOSITE PARTIES: NIL EXHIBITS MARKED ON BEHALF OF THE COMPLAINANT Ex.A1
- Copy of payment of claim sent to LIC, Division, Kadapa dt.08-07-2001.
Ex.A2
- Xerox copy of the policy bearing No.651705297 issued by LIC of India, Tadipatri Branch.
Ex.A3 - Copy of status report of policy bearing No.071845414 dt.14-06-2006 issued by LIC of India, Division, Kadapa.
Ex.A4 - Original letter dt.11-04-2005 issued by the 2nd opposite party addressed to the complainant.
Ex.A5 Letter dt.30-04-2005 addressed to the Zonal Manager, South Central Zonal Office, LIC of India, Saifabad, Hyderabad by the complainant.
Ex.A6 - Xerox copy of the letter dt.17-05-2005 addressed to the complainant by the Zonal Manager, LIC of India, S.C. Zonal Office, Saifabad, Hyderabad.
Ex.A7
- Original letter dt.08-09-2005 addressed to the complainant by the Senior Divisional Manager, LIC of India, Kadapa repudiating the claim under policy bearing Nos.71845414 and 651705297.
Ex.A8 - Xerox copy of FIR in crime No.36/2001 of Pamidi P.S. Ex.A9 -- Xerox copy of Post-mortem Certificate of late Konda Reddy.
Ex.A10 - Certified copy of judgment in S.C.No.422/02 on the file of the Senior Civil Judges Court, Gooty.
EXHIBITS MARKED ON BEHALF OF THE OPPOSITE PARTIES Ex.B1 - Original policy bearing No.651705297 dt.18-11-1995 issued by the Branch Manager, LIC of India, Tadipatri (1st opposite party) in the name of the deceased K.Konda Reddy.
Ex.B2
- Original letter dt.11-04-2005 by Registered Post Acknowledgment due, addressed to the complainant by the 2nd opposite party.
Ex.B3
- Attested copy of the Judgment in Sessions case No.422/2002 on the file of the VI Addl. Sessions Judge, Gooty.
Sd/-
Sd/-
MEMBER PRESIDENT - INCHARGE DISTRICT CONSUMER FORUM, DISTRICT CONSUMERS FORUM, ANANTAPUR ANANTAPUR Typed by JPNN