DISTRICT CONSUMER DISPUTE REDRESSAL FORUM (EAST)
GOVT. OF NCT OF DELHI
CONVENIENT SHOPPING CENTRE, FIRST FLOOR,
SAINI ENCLAVE, DELHI – 110 092
C.C. NO. 1117/14
Shri Neeraj Sharma
S/o Shri V.P. Sharma
R/o 14, 2nd Floor, Shiv Puri
Delhi – 110 051 ….Complainant
Vs.
M/s. Aviva Life Insurance Co. Ltd.
501-502, 5th Floor, Nipun Tower
Karkardooma Community Centre
Branch Preet Vihar, Delhi – 110 091 ….Opponent
Date of Institution: 22.12.2012
Judgment Reserved for : 11.08.2016
Judgment Passed on : 22.08.2016
CORUM:
Sh. Sukhdev Singh (President)
Dr. P.N. Tiwari (Member)
Ms. Harpreet Kaur Charya (Member)
Order By : Shri Sukhdev Singh (President)
JUDGEMENT
The complainant Shri Neeraj Sharma has filed a complaint under Section 12(a) of the Consumer Protection Act 1986 (hereinafter to be referred as Act), against M/s. Aviva Life Insurance Co. Ltd. to withdraw the letter of termination, compensation for Rs. 50,000/- and litigation charges for Rs. 15,000/-.
2. The facts in brief are that the complainant obtained/purchased a policy bearing NO. AFP2870477 for the assured sum of Rs. 2,50,000/- for which the complainant had to deposit the premium amount of Rs. 25,000/-p.a. The policy commenced from 30.01.2010 and the complainant had paid three instalments i.e. for the year 2010, 2011 and 2012 making a total of Rs. 75,000/-. It is further stated that the complainant received a cheque for an amount of Rs. 25,000/- of dated 22.10.2013 which was deposited by him in his account accidentally and without reading the covering letter, attached with the said cheque. After deposit of the said cheque on 22.11.2013, the complainant read the contents of the same and was surprised to know that OP had terminated the policy of the complainant. He immediately contacted the office of the OP and requested them to renew his policy and also addressed a communication in this regard alongwith his cheque of Rs. 25,000/-(being refund of the cheque amount encashed accidentally and inadvertently) vide letter dated 26.11.2013. He further requested that the complainant was ready to deposit the amount of interest and necessary charges, if any, for renewal of the said policy. However, his request for renewal of the policy was denied. It is stated that OP had illegally and unlawfully deducted the amount of Rs. 50,000/- from the total amount of Rs. 75,000/-, which was deposited by the complainant and they have no right to forfeit the amount of Rs. 50,000/- out of the deposited amount.
The complainant served a legal notice of dated 14.10.2014, which was duly served. Thus, the complainant has prayed for direction to OP to withdraw the order/letter of termination and renew the policy of the complainant by accepting the instalments along with amount of interest and necessary charges, if any due towards the complainant. He has further claimed damages amounting to Rs. 50,000/- on account of deficiency in service and Rs. 15,000/- towards litigation charges.
3. In the WS, M/s. Aviva Life Insurance Co. Ltd. (OP) has taken various preliminary objections such as the complainant was bound by the principle of estoppels and acquiescence as the complainant had paid premium amount towards the subject policy for three years without raising any concern towards the terms and conditions of the said policy which clearly indicated that the letter of acquiescence to the terms and conditions of the subject policy. Therefore, due to non-receipt of premiums, the subject policy had been auto foreclosed on 18.10.2013 and subsequently surrender value cheque to the tune of Rs. 25,000/- had been issued to the complainant, which had been encashed by the complainant. Thus, it has been stated that the encashment of the surrender value cheque culminates the relationship between the parties and inter se and accordingly the present complaint was not maintainable. The complainant ceased to be a consumer of OP as he had encashed the surrender value cheque, which had been issued in his favour. The complaint was without any cause of action. The OP was not guilty of any deficiency in services or unfair trade practice.
It is further stated that under the IRDA (Protection of Policy Holders’ Interest) Regulations 2002, the policy terms and conditions specifically provides for a Free Look Period of 15 days during which period the policy owner was entitled to renew the policy terms and conditions and request for cancellation if dissatisfied with the terms and conditions of the policy. Regular payment of premium was the sole responsibility of the policy holder. The insurance was a contract between the holder of the policy and an insurance company. Both complainant and OP were bound to act as per the terms and conditions of the policy.
On merits, it has been stated that the complainant paid premium for three years but out of his own will and wish, he deliberately stopped paying premium, due in the year 2013 when he was very well aware that the premium was to be paid for 10 years. The complainant paid premium for the period of three years but failed to pay premium for the year 2013, because of which the status of the said policy was changed to Inforce Reinstatement Period on 02.03.2013. It is stated that Inforce Notice Period takes place when the premium discontinues after 36 months from the date of coverage and on 01.04.2013, the status of the policy was inforce Reinstatement Period. The re-instatement letter was also sent to the complainant but the complainant did not bother to pay premium on receiving the same. When the complainant failed to reinstate the said policy within the prescribed time frame, the status of the policy was changed to auto foreclosed on 18.10.2013 and a cheque of surrender value of Rs. 25,000/- was dispatched and delivered on 28.10.2013 which the complainant encashed. Regular and periodic communication such as policy account statement, lapse letter, premium notice, indexation letter etc. were sent to the complainant and addressed to keep him apprise about the policy status. Other pleas of the complainant has also been denied.
4. In the replication, the complainant has controverted the pleas of OP and have reasserted his pleas made in the complaint.
In support of its complaint, the complainant has examined himself who has deposed on affidavit. He has narrated the facts which have been stated in the complaint. He has also got exhibited the copy of policy along with policy account statement (Ex.CW1/1), copy of letter dated 26.11.2013 (Ex.CW1/2), copy of payment advice with copy of cheque (Ex.CW1/3), copy of reminder dated 28.04.2014 (Ex.CW1/4) and copy of legal notice dated 14.10.2014 (Ex.CW1/5).
In defence, OP has examined Shri Bhuwan Bhashker, attorney of Aviva Life Insurance Company India Ltd. who has deposed on affidavit. he has also narrated the facts which have been stated in the WS. He has also got exhibited the proposal form (Ex. DW1/A), copy of terms and conditions of ANFL Plan (Ex.CW1/B), policy schedule (Ex.CW1/C), reinstatement letter (Ex.CW1/D), copy of cheque (Ex.CW1/E), letter of dated 02.12.2013 sent to the complainant (Ex.CW1/F) and reply of the legal notice (Ex.CW1/G).
5. We have heard the Ld. Counsel for the parties and have perused the material placed on record. It has been argued on behalf of OP that the complainant was bound by the principle of estoppels and acquiescence as the complainant had paid premium towards the policy for three years without raising any concern towards the terms and conditions of the said policy, which showed that the complainant had acquiesced to the same. Further, due to non-receipt of premium, the subject policy had been auto foreclosed and the complainant had encashed the surrender value cheque amounting to Rs. 25,000/-. By doing so, it has been argued that there was no relationship between the parties. It has further been argued that the complainant was not a consumer and the complaint was without any cause of action. it has further been argued that the complainant was bound by the terms and conditions of the policy which he accepted while getting the policy. It has also been argued that payment of premium was the sole responsibility of the policy holder.
The counsel for the complainant has also relied upon the judgement of Hon’ble National Commission decided on 14.08.2008 in the case of LIC Vs. Siba Prasad Dash(Dr.) and Ors. where it was laid down that in a case of lapse of policy for non-payment of premium, insurer cannot be asked to refund the premium for the period when he had covered the risk. The insured cannot be given advantage of ‘Risk Coverage’ as also of refund of premium.
On the other hand, Ld. Counsel for the complainant has argued that the complainant had not acquiesced and he was not bound by the principle of estoppels. He has further argued that the complainant under bona fide mistake got encashed the cheque, which was sent by OP. He has further argued that the complainant was willing to return back the amount of encashed cheque alongwith interest, if any, for renewal of the policy.
6. To appreciate the arguments of Ld. Counsel for the parties, a look has to be made to the testimony of the complainant as well as the testimony of M/s. Aviva Life Insurance Co. Ltd. (OP) and the documents placed on record. It is admitted case of both the parties that the complainant received cheque for an amount of Rs. 25,000/- by way of cheque of dated 22.10.2013 which he got encashed. This cheque was refund cheque of the subject policy. When the complainant has got the refund cheque and have encashed the same, the complainant ceased to be consumer. This does not mean relationship between the parties. Once, he is not a consumer, his complaint cannot be said to be maintainable at all. It is well-settled that once the complainant has encashed the cheque unintentionally, the complaint ceased to be a consumer under the Act. The privity of contract or relationship of consumer and service provider between the parties, if any, came to an end, the moment the complainant accepted the amount unintentionally and encahsed it. Not only this, it has come on record that the policy lapse for non-payment of premium when the complainant has not paid the premium which has resulted into lapse of policy and OP have refunded the cheque which has been encashed by the complainant. He cannot ask for revival of a lapse policy. The arguments advanced on behalf of OP holds good.
7. In view of the above, we are of the opinion that the complainant was not a consumer. Therefore, his complaint was not maintainable. Hence, the same is dismissed with cost of Rs. 10,000/-.
Copy of the order be supplied to the parties as per rules.
File be consigned to Record Room.
(DR. P.N. TIWARI) (HARPREET KAUR CHARYA)
Member Member
(SUKHDEV SINGH)
President
