STATE CONSUMER DISPUTES REDRESSAL COMMISSION,

U.T., CHANDIGARH

Mahinder Singh, C/o Sh. Pritam Singh, resident of H.No.8, B-1, Village Papri, Tehsil Mohali, District Mohali.

                                ---Appellant/Complainant

Versus

1. AVIVA Life Insurance, 5^th  Floor, JMD Regent Square, Gurgaon, Mehrauli, Gurgaon, through its Branch Head/ Branch Manager.

2. AVIVA Life Insurance Company, Office at SCO No.101-103, Sector 17-D, Chandigarh, through its Branch Manager/ Authorized Representative.

…..Respondents/Opposite Parties

Appeal under Section 15 of the Consumer Protection Act, 1986.

BEFORE:   JUSTICE SHAM SUNDER (RETD.), PRESIDENT.

                MRS. NEENA SANDHU, MEMBER.

Argued by: Sh. Deepak Aggarwal, Advocate for the appellant.   

PER  JUSTICE SHAM SUNDER (RETD.), PRESIDENT

              This appeal is directed against the order dated 09.08.2012, rendered by the District Consumer Disputes Redressal Forum-II, U.T., Chandigarh (hereinafter to be called as the District Forum only), vide which, it dismissed the complaint, filed by the complainant (now appellant).

2.             The facts, in brief, are that the complainant, being allured by the false assurances of the representative/agent of the Opposite Parties, purchased the Insurance Policy bearing No. RSG 1655620 on 16.08.2007, on payment of premium of Rs.30,000/-. It was stated that the complainant was assured that the amount would be refunded after three years, with profits. It was further stated that, after the lapse of three years, when the complainant went to collect the money, which was due against the aforesaid Policy, he was told that the same (Policy) had lapsed. It was further stated that the Policy documents, being in English language, were beyond the comprehension of the complainant. It was further stated that the complainant was cheated, by the representative/agent of the Opposite Parties, by making false assurances and mis-representing the facts. It was further stated that this amounted to daylight robbery. It was further stated that the Opposite Parties, were requested to refund the amount of premium, deposited by the complainant, alongwith interest, as also pay compensation, for mental agony and physical harassment, but they refused to do so.. It was further stated that the aforesaid acts of the Opposite Parties, amounted to deficiency, in rendering service, as also indulgence into unfair trade practice. When the grievance of the complainant, was not redressed, left with no alternative, a complaint under Section 12 of the Consumer Protection Act, 1986 (hereinafter to be called as the Act only), was filed.

3.             The Opposite Parties, in their joint written version, pleaded that the complaint was barred by time, as the Policy was purchased on 16.08.2007, by paying one premium, and, thereafter, the complainant failed to pay further annual premiums, though various letters were sent to him. It was denied that the representative/ agent of the Opposite Parties, misrepresented the facts to the complainant, made false assurances or cheated him. It was stated that such allegations were beyond the Jurisdiction of the District Forum. It was, however, stated that the proposal form dated 10.08.2007, was duly filed in, and signed by the complainant, in English, against which the Policy, in question, commencing from 16.8.2007 was issued to him. The Policy document was despatched to the complainant on 18.8.2007, vide Speed Post No.EHO739911054IN, which included the Policy Schedule, the Right to Reconsider Notice, and other relevant documents. It was further stated that since the complainant, failed to pay the annual premium, which was due on 15.08.2008, or, even within the grace period of 30 days, the policy lapsed on 21.09.2008. It was further stated that the status of the Policy was changed to “early lapse” when the grace period was over. It was further stated that the complainant had right to reinstate the Policy, within 02 years, from the first unpaid instalment of regular premium, but he failed to do so. It was further stated that the Policy did not acquire any surrender value, on account of its status having been changed to “early lapse not payable” on 17.08.2010. It was further stated that the complainant, being 12^th  pass, knew English, and had filled in and signed the proposal form, in English language. It was further stated that there was neither any deficiency, in rendering service, on the part of the Opposite Parties, nor they indulged into unfair trade practice. The remaining averments, were denied, being wrong.

4.             The parties, led evidence, in support of their case.

5.             After hearing the Counsel for the parties, and, on going through the evidence, and record of the case, the District Forum, dismissed the complaint, as stated above.

6.             Feeling aggrieved, the instant appeal, has been filed by the appellant/complainant.

7.             We have heard the Counsel for the appellant, and, have gone through the evidence and record of the case, carefully. 

8.             The Counsel for the appellant, submitted that the appellant, being not so highly educated, could not comprehend the contents of the Policy document, including the terms and conditions thereof, which were in English. He further submitted that the complainant was misled by the misrepresentation made by the Insurance Agent. He further submitted that the complainant was cheated by the representative/agent of the Opposite Parties, with regard to the features of the Policy. He further submitted that the complainant was entitled   to the amount of the Policy and other benefits, after the expiry of three years of purchase of the same. He further submitted that, no doubt, one premium was paid by the complainant, and, thereafter, he did not pay the same. He further submitted that once the District Forum, came to the  conclusion, that the allegations of false assurances, cheating and misrepresentation of facts, were beyond its Jurisdiction, it was required of it, to relegate the complainant, to an alternative remedy, of approaching the Civil Court, but instead, it wrongly dismissed the complaint. He further submitted that the order of the District Forum, being illegal and invalid, is liable to be set aside.

9.             It is evident from Annexure A, copy of the proposal form, at page 135 of the District Forum file, that the term of the plan was 15 years. The premium paying term was 15 years. The annual premium was Rs.30,000/-. The sum assured was Rs.2,25,000/-. This proposal form was signed by Mr. Mahinder Singh, Complainant, on 10.08.2007, at Chandigarh, in English, under the heading “Declaration and Authorization”. Admittedly, only one premium, at the time of purchase of the Policy, in the sum of Rs.30,000/-was paid by the complainant. The next annual premium due on 15.08.2008, was not paid by him. The complainant, being 12^th pass, knew English, and signed the proposal form, in that language. It, therefore, could not be said that he could not understand the terms and conditions contained, in the proposal form. Undisputedly, the Policy document, schedule and the terms and conditions of the Policy, were received by the complainant. Under these circumstances, the mere allegation of the complainant, that misrepresentation of facts was made to him, by the representative/agent of the Opposite Parties, and he was cheated by him, without any cogent and convincing evidence, having been produced by him, to substantiate the same, does not prove the same.

10.           Since the Policy document, schedule and the terms and conditions of the Policy were supplied to the complainant, the parties were bound by the same. Articles 4.1, 4.2, 4.2.1, 4.3., 12.1 and 13.1 of the Standard Terms and Conditions, at pages 151, 153  and 155, of the Insurance Policy, read as under:-

“Article 4 – Non Payment of Regular Premium within the first three consecutive years from the Commencement Date and Non-Forfeiture Provisions

4.1 It is a condition precedent to the Company`s liability to make payment under this Policy that there has been payment of Regular Premium by the Policyholder. If the Regular Premium is not paid in the manner or amount or at the time provided for, then the Company will allow a period of grace of 30 days from the date upon which the Regular Premium should have been paid within which the default shall be rectified, and if not rectified then the provisions of Article 4.2 below shall apply. During the grace period, the benefits under Article 9 below will continue to be payable.

4.2  if an instalment of Regular Premium is not paid within the period of grace from its due date as defined in Article 4.1 and the due date is less than 24 months from the Commencement Date, then, the Policy will lapse with all risk cover ceasing immediately and no death benefit shall be payable.

4.2.1. The Policyholder may reinstate the Policy within two years of the due date of the first unpaid instalment of Regular Premium subject to Article 4.9.

4.3 If the Policy is not reinstated within two years from the due date of the first unpaid instalment of Regular Premium, the Policy will automatically terminate without any value at the date of the expiry of the reinstatement period and the surrender value in respect of Top Up Premiums, if any, as per Article 12 shall be paid to the Policyholder at the expiry of the reinstatement period or the commencement of the fourth Policy Year, whichever is later.

              Article 12 Surrender Value

12.1       After the commencement of the fourth Policy year and subject to the payment of Regular Premium due in the first two Policy Years, the Policyholder shall, upon the termination of this Policy for any reason (other than the death of the insured), be entitled to a surrender value as at the date of surrender calculated as follows:”

“Article 13 Non Payment of Regular Premium after three consecutive years from the Commencement Date and Non-Forfeiture Provisions: 

13.1      Subject to Article 15, with effect from the commencement of the fourth Policy Year, if the Policyholder has paid Regular Premium due for the first three consecutive Policy Years, but has failed to pay the Regular Premium due within the grace period of 30 days from the due date of unpaid Regular Premium at any time thereafter, the Policy shall remain in force for the full risk cover for 2 consecutive years from the due date of the first unpaid Regular Premium, during which period, the Policy may be reinstated.”

Chart of Illustration-Benefits for Policy No. RSG 1655620,  is placed at page 85 of the District Forum file.

11.           The careful perusal of the afore-extracted Articles of the standard terms and conditions of the Policy and also the chart of Illustration-Benefits for the Policy, in question, clearly goes to reveal that the complainant was not entitled to any amount, as the policy had not acquired any surrender value, on account of the reason, that he had paid only one premium. He even did not get the policy reinstated, within the period of 2 years, from the first date of unpaid regular premium, as per the afore-extracted Articles. Under these circumstances, the Policy lapsed and acquired the status of “early lapse-not payable”. Since, neither the premiums, after the payment of first premium were paid, nor the complainant got the Policy reinstated, within the period of 2 years, from the first date of unpaid regular premium, the Policy stood terminated, and did not acquire any surrender value. The District Forum was, therefore, right in holding that the complainant, was not entitled to any amount, under the Policy. The findings of the District Forum, in this regard, are affirmed.

12.           Coming to the submission of the Counsel for the appellant, that once the District Forum, came to the conclusion, that the allegations of false assurances, cheating and misrepresentation of facts, were beyond its Jurisdiction, it was required of it, to stay of its hands, and relegate the complainant, to the remedy of approaching the Civil Court, it may be stated here, that the same does not merit acceptance. The question arises, as to whether, mere allegations of misrepresentation and cheating leveled, in the complaint, could be said to be sufficient, to oust the Jurisdiction of the Consumer Fora. The Consumer Foras, are established with the sole object to provide speedy, inexpensive and affordable redressal of the grievances of the Consumers. It may be stated here, that Section 3 of the Act, provides an additional remedy. In the complaint, it was averred by the complainant, that there was deficiency, in rendering service, on the part of the Opposite Parties, and they indulged into unfair trade practice. In J.J. Merchant (Dr.) V. Shrinath Chaturvedi, IV (2002) SLT 714 =III (2002) CPJ 8 (SC) =2002 CTJ 757 (SC) (CP), the Hon`ble Supreme Court, held as under:-

“This submission also requires to be rejected because under the Act, for summary or speedy trial, exhaustive procedure in conformity with the principles of natural justice is provided. Therefore, merely because it is mentioned that Commission or Forum is required to have summary trial would hardly be a ground for directing the consumer to approach the Civil Court. For the trial to be just and reasonable, long-drawn delayed procedure, giving ample opportunity to the litigant to harass the aggrieved other side, is not necessary. It should be kept in mind that legislature has provided alternative, efficacious, simple, inexpensive and speedy remedy to the consumers, and that should not be curtailed, on such ground. It would also be totally wrong assumption that because summary trial is provided, justice cannot be done, when some questions of fact are required to be dealt with or decided. The Act provides sufficient safeguards”.

13.          In CCI Chambers Coop. Hsg. Society Ltd. V. Development Credit Bank Ltd. V (2003) SLT 185=III (2003) CPJ 9 (SC)=2003 CTJ 84 (SC) (CP), the Hon`ble Supreme Court held as under:-

“It cannot be denied that Fora at the National Level, the State level and at the District level have been constituted under the Act with the avowed object of providing summary and speedy remedy in conformity with the principles of natural justice, taking care of such grievances as are amenable to the jurisdiction of the Fora established under the Act. These Foras have been established and conferred with the jurisdiction in addition to the conventional Courts. The principal object sought to be achieved by establishing such Foras is to relieve the conventional Courts of their burden which is ever-increasing with the mounting arrears and whereat the disposal is delayed because of the complicated and detailed procedure, which at times is accompanied by technicalities. Merely because reading of evidence is required, or some questions of fact and law arise which would need to be investigated and determined, cannot be a ground for shutting the doors of any Forum under the Act to the person aggrieved”.

14.          In Lalco Enterprises Vs. Union Bank Of India, III (2003) CPJ 42 (NC) the allegations were that 25 cheques, which had forged signatures of the account holder, were encashed by the Bank, and the amount was debited to the account of the account holder. The complainant, claimed the amount of cheques, which had been debited to the account of the account holder. On consideration of the matter, the National Consumer Disputes Redressal Commission, New Delhi, in Lalco Enterprises case(supra), dismissed the Revision Petition, by observing as under:-

“The question that arose before the District Forum was about the authenticity of the signatures of the withdrawal of the cheques. It was difficult for District Forum to go into the question of genuine signatures on each and every cheque and to get the report from the handwriting expert from either side. However, District Forum found that there was certainly discrepancy of 2 cheques and amount of those cheques was Rs. 18,320/-. It was on this account that complaint was partly allowed and Bank was directed to pay Rs. 18,320/- with interest therein @ 15% p.a. and Rs. 2,000/- was also awarded as cost to the complainant. Aggrieved by the order of the District Forum, complainant filed an appeal before the State Commission where the appeal was dismissed. Still feeling aggrieved, complainant has come before us. After examining the whole aspect of the matter, we feel that District Forum was rather generous to the complainant that had awarded the amount of two cheques. Since the Bank is not before us, we do not say anything on this subject. We do not find it a case where we should exercise our jurisdiction under Clause (b) of Section 21 of the Consumer Protection Act. The Revision Petition is dismissed”.

15.          Needless to mention here, that the District Forums, the State Consumer Disputes Redressal Commissions, and the National Consumer Disputes Redressal Commission, have been entertaining complaints, against the Opposite Parties/Agencies, wherein, in some cases, criminal complaints were also lodged with the Police, which registered cases, and took up the investigation. In such cases, despite there being the allegations of misrepresentation of facts, false assurances, fraud, forgery, cheating or conspiracy, the Consumer Foras were not dissuaded from entertaining the complaints and did not relegate the complainants to the Civil Court, merely because the allegations of misrepresentation of facts, false assurances, fraud, forgery, cheating or conspiracy were made. Merely because, in a complaint, based on the defect in goods or deficiency, in service, the complainant, makes allegations of misrepresentation of facts, false assurances, fraud, forgery, cheating or conspiracy or some other criminal act, in the process, it does not mean that the Jurisdiction of the Consumer Fora, should automatically be ousted, in entertaining and dealing with such complaints. Besides, the standard of proof, required in a complaint, before the Consumer Fora, and that is required to establish the commission of criminal offence(s) before a Criminal Court, is not the same. While a complaint before the Consumer Fora, can be answered, on the basis of preponderance of probabilities, the Criminal Court would insist on much stricter proof, to hold any person guilty of criminal charge. It may also be noted here that the outcome of the two actions, before the two Foras, is not dependent upon the findings of each other. Similar principle of law, was laid down, in Sutlej Textile and Industries Ltd. Vs. Punjab National Bank, I (2010) CPJ 312 (NC). The principle of law, laid down, in the aforesaid cases, is fully applicable to the facts of the instant case. Mere fact, that the allegations of misrepresentation of facts and cheating/fabrication were levelled by the complainant, did not mean that the Consumer Fora, was not competent to entertain and decide the complaint. According to Section 13(4) of the Act, powers of Civil Court, in the matters, listed therein, are conferred upon the Consumer Foras. Under these circumstances, it could not be said that since the allegations of misrepresentation of facts, false assurances and cheating were leveled, in the complaint, the Jurisdiction of the Consumer Fora, to decide the complaint was ousted, under the Act. The observations of the District Forum that the allegations of the complainant, with regard to misrepresentation, cheating and fraud were beyond its purview, are not correct. The submission of the Counsel for the appellant, in this regard, being devoid of merit, must fail, and the same stands rejected.

16.          No other point, was urged by the Counsel for the appellant.

17.          The order passed by the District Forum, being based on the correct appreciation of evidence and law on the point, does not suffer from any illegality or  perversity, warranting the interference of this Commission.

18.          For the reasons recorded above, the appeal, being devoid of merit, must fail, and the same is dismissed, at the preliminary stage, with  no  order as to costs. The order of the District Forum is upheld.

19.          Certified copies of this order, be sent to the parties, free of charge.

20.          The file be consigned to Record Room, after completion

Pronounced.

October 8, 2012

Sd/-

[JUSTICE SHAM SUNDER(RETD.)]

PRESIDENT

Sd/-

[NEENA SANDHU]

MEMBER

Rg