Orissa

Sambalpur

CC/8/2022

Sabita Suna, - Complainant(s)

Versus

1. Branch Manager,LIC of India, Branch I - Opp.Party(s)

Shri. B.Dash

27 Mar 2023

ORDER

PRESIDENT, DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION, SAMBALPUR

                             CONSUMER COMPLAINT NO. 8/2022

 

Present-Dr. Ramakanta Satapathy, President,

  Sri. Sadananda Tripathy, Member,

 

Sabita Suna,

W/O-Late Parameswar Urma, 

R/o-Remja, Po-Brajarajnagar, Dist-Jharsuguda,

At Present C/o- Lokhendra Tandi, Putiband, TF College Road,

PO/PS-Dhanupali, Dist-Sambalpur                      ...………..Complainant

                                                Versus

1. Branch Manager,

LIC of India, Branch I

Jeevan Prakash, LIC Building

Budharaja, Sambalpur-768004.

2. Branch Manager,

Union Bank of India,

Ainthapali Branch, 994,

Bhagabati Complex, No.15,

N.H. 6, Ainthapali, Sambalpur-768004     …………...Opp.Parties

Counsels:-

1. For the Complainant      :-          Sri. B.Dash, Advocate
2. For the O.P.No.1             :-          Sri. A.K.Dash, Advocate.
3. For the O.P. No.2                        :-          Sri. L.K.Panigrahi & Associates

 

Date of Filing:22.03.2022,  Date of Hearing :13.02.2023  Date of Judgement : 27.03.2022

  Presented by Dr. Ramakanta Satapathy, PRESIDENT

 

1. The case of the Complainant is that husband of Complainant namely Parameswar Urma was having a policy Jeevan Anand bearing No. 831576635 for S.A. Rs. 200,000/- with policy term 815-16-16. Date of maturity of the policy is 07.11.2034. Monthly premium Rs. 1364/- was to be deducted from the account of Complainant A/C No. 761202010001417 with the O.P. No.2, Bank. Till 07.10.2020 the O.P. No.2 transferred the amount regularly to O.P. No.1 but on 07.11.2020 not deducted the amount. On 7^th October 2020 the insured was detected jaundice, admitted in VIMSAR, Burla and died on 28.11.2020.

After death of insured the Complainant submitted all the documents for death claim but the O.P. No.1 issued a letter dated 27.07.2021 and said that the policy was on lapsed condition at the time of death of the insured. The O.P. No.2 was authorised to deduct the amount from Complainant’s account deduction on 07.11.2020 the policy lapsed due to non intimation of the O.Ps. The Complainant served a pleader notice dated 21.10.2021 to the O.Ps but the matter was not settled.

Being aggrieved this Complaint was filed.

2. The insurer Corporation in its version admitted the policy and mandate issued by the Complainant. The answering O.P. not received the premium for Nov. 2020. For which the policy lapsed. The customer should maintain minimum balance on the account and it is the duty of Complainant and the O.P. No.2. The O.P. No.2 is liable for lapse of the policy. There is no deficiency on the part of the O.P. No.1. As per the policy payment condition (NACH Monthly Mode) premium will be deducted every month from the authorised account. Due to non maintenance of sufficient account balance prior to due date of premium on 07.11.2020 the due generate by the system became dishonoured. Due to non payment of premium the policy lapsed on date of death of the policy holder.

There is no any deficiency on the part of the answering insurer O.P.

3. The O.P. No.2 bank in its version submitted that the answering O.P. deducted the premium regularly from the account of the Complainant as per standing instruction given by Complainant. On 07.11.2020 the balance in the account of the Complainant was insufficient for deduction of Rs. 1364/- through Electronics cleaning system. During the entire banking hour on 07.11.2020 there was insufficient fund in the account of the Complainant. The Complainant deposited certain amount in the account in the evening after the banking hour is over, the reason best known to her. The next day 08.11.2020 was sun day and E.C.S. could not hit on that day. On 10.11.2020 the Complainant has withdrawn the amount from the account. She should have deposited the premium through alternate mode, when she knew that, the premium has not been deducted from the account till 10.11.2020.

There is no deficiency in service of the O.P. as the E.C.S. is controlled and maintained by National Automated Cleaning House and at the time of hit there was insufficient fund.

4. The Complainant filed

1. Copy of policy No. 831576635 S.A. Rs. 200,000/-, Premium Rs. 1364/PM, dated of premium 7^th of every month, commenced on 07.12.2018.
2. Confidential report by the Agent
3. Medical Attendant’s Certificate
4. Certificate of hospital treatment.
5. Certificate, of identity and burial or cremation
6. Claimant’s Statement.
7. A/C Statement A/C No. 761202010001417.
8. Certificate of death of Parameswar Urma.
9. History of premium transitions.
10. Letter of repudiation dated 27.01.2021.
11. Rejection letter of policy dated 07.07.2021
12. Pleader notice dated 18.10.2021.
13. NACH Mandate form.

The O.P. No.1 insurer filed the following documents:

1. Mandate form dated 07.12.2018 signed by Complainant.
2. Copy of NACH invoice detail dated 07.11.2020 showing insufficient fund RBI sequence No. NACH Centre 1744264738B051

5. After perusal of the complaint petition, version of the parties and documents filed the following issues are framed:

 

103606587.  

1. Whether on 07.11.2020 there was insufficient fund in S.B. A/C No. 761202010001417 Union Bank of India in the name of the Complainant?
2. Whether the O.Ps are deficient in their service?
3. What relief the Complainant is entitled to get?

Issue No.1 Whether on 07.11.2020 there was insufficient fund in S.B. A/C No. 761202010001417 Union Bank of India in the name of the Complainant?

The Complainant submitted a mandate before the insurer on 07.12.2018 that for policy No. 831576635 the premium monthly amount shall be deducted from her SB A/C No. 7612020001417 IFSC-UBIN-0576123 maintained in O.P. No.2 Bank. From policy invoice history it reveals that on every 7^th day of month RS. 1359/- was debited from the account of the Complainant but on 07.11.2020 it is shown that the transaction hit dishonoured due to insufficient balance in account of Sabita Suna as per sequence No. NACH Centre 1744264738B051.

From the account Statement submitted by Complainant dated 07.11.2020 it reveals that in the account during the opening of thereafter NEFT transaction of Rs. 3000/- vide No. 000297622319, the balance on 07.11.2020 was Rs. 3,018.06P. As per submission of O.P. No.2 the Complainant deposited certain amount in the account in the evening after the banking hour is over, unfortunately the next day was a sun day and thus the E.C.S. could not hit on the day. From the very statement it is clear that at the time of hit by NACH Centre found was insufficient but on the same day in the alleged account sufficient fund was there.

The day 07.11.2020 covers 24 hours and in the mandate form there is no any specification of withdrawal time has been mentioned. It implies the automated system failed to recognise the alleged account and not deducted the premium although sufficient fund was there on 07.11.2020. Non deduction of the amount on the alleged day is the root cause of the dispute. The O.P. No.2 can not take the plea that on 07.11.2020 there was insufficient fund in the account. The O.P. No.2 should have developed such system within 24 hours automatically the amount will be deducted from the account. It is a clear violation of the mandate given by the Complainant.

The issue is answered accordingly.

Issue No.2   Whether the O.Ps are deficient in their service?

Due to non remittance of the premium the policy became lapsed and as per NACH guidline when debit customer’s bank is dishonoured, deduction will automatically stop for the further dues until the premiums that have fallen due are paid at LIC Branch/Premium, Point/LIC Customer Poratl. The debit dates are calculated on the basis of commencement as follows:-

Date of Commencement	Debit date
1St to 7th	7th of Same Month
8th to 15th	15th of Same Month
16th to 22nd	22nd of Same Month
23rd to 28th	28th of Same Month

 

When the amount not deposited with O.P. No.1 on 07.11.2020, On claim the O.P. No.1 intimated vide letter dated 27.07.2021 that the policy lapsed on the date of death i.e 28.11.2020 due to non payment of due 11/2020. The grace period for monthly mode of payment is 15 days. The manager(Claims) again intimated vide letter dated 07.07.2021 that the competent authority rejected the claim on the ground that the policy was in lapsed condition on the date of death. Here question arises after 07.11.2020 when payment was not received the O.P. no.1 has not issued any intimation to the Complainant about the grace period of 15 days. Not a single document has been filed by the O.P. No.1. No doubt, it was the duty of Complainant to deposit the lapsed premium immediately for revival of the policy but the O.P. No.1 neither issued any intimation immediately after 07.11.2020 and also after 22.11.2020.

The commercial organisation to develop their business intimate repeatedly through messages, letter s etc., but when any lapse from the depositor’s side made, it is their duty to remind the position of the particular policy, deposits to continue the same. In the instant case the O.P. No.1 intimated only after when claim was made knowing fully well about the health condition of insured and mental status after death of the Complainant. The delay in intimation of lapse of the policy amounts to deficiency in service on the part of the O.P. No.1.

In the other hand the O.P. No.2 was duty bound to deduct the premium on the schedule date but failed to deduct although the account was having sufficient amount. It amounts to deficiency in service of the O.P. No.2. From history of premium transactions it reveals that the timing of deduction of premium is different on the due date, It implied the whimsical deductions of O.P. No.1 and remittance of O.P. No.2.

The O.P. No.1 filed a decision of Hon’ble Supreme Court of India. LIC & another VS Sunita in S.L.P. (Civil No. 13868/2019) which is related to revival of the policy. The circumstances of the case is different than the present case and it is not applicable.

 

Issue No.3 What relief the Complainant is entitled to get?

After taking into Consideration the circumstances of the case the complaint is entitled for the relief and accordingly it is order:

 

ORDER

The complaint is allowed on contest against the O.Ps. The O.P. No.2 is directed to pay the insured amount with the death benefit to the Complainant with 9% interest P.A. w.e.f. 29.11.2020. The O.P. No.1 is directed to give a detail calculation of the benefits to O.P. No.1 within one month of this order with due intimation to the Complainant.

For deficiency in service, non intimation and compensation both the O.Ps are to Pay Rs. 50,000/- each to the Complainant.

In case of non payment the respective amount will carry 12% interest P.A. till realisation.

The O.Ps are liable to pay litigation cost of Rs. 5000/- each to the Complainant.

Order pronounced in open court on this 27^th day of March 2023

Supply free copies to the parties.