STATE CONSUMER DISPUTES REDRESSAL COMMISSION,

U.T., CHANDIGARH

Harkanwal Kaur, wife of Sh. Jagdish Singh, resident of House No.3131/2, Sector 44-D, Chandigarh.

……Appellant/complainant

V e r s u s

1.  The Branch Manager, Bajaj Allianz Life Insurance Company Limited, SCO No.215-217 (Fourth floor) Sector 34-A,Chandigarh.

2.  The Managing Director, Bajaj Allianz Life Insurance Co.  Ltd., G.E. Plaza, Airport Road, Yerawada, Pune-411006.

              ....Respondents/Opposite Parties

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

BEFORE:    JUSTICE SHAM SUNDER, PRESIDENT.

                   MRS. NEENA SANDHU, MEMBER.

Argued by:  Sh.Jagdish Singh Tanwar, Counsel for the appellant.

              Sh.Varun Chawla, Counsel for the respondents.

PER  JUSTICE SHAM SUNDER, PRESIDENT

1.               This appeal is directed against the order dated 13.01.2012, rendered by the District Consumer Disputes Redressal Forum-I, 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 took Life Insurance Policy bearing no. No.0010837442, from the Opposite Parties, commencing from 1.10.2005, for a sum of Rs.1,25,000/-. The complainant paid three annual installments of Rs.25,000/- each, for three years.  She paid a total sum of Rs.75,000/-. According to Clause 6 of the policy document, if the installments are paid continuously for three years, the policy was not to lapse, and the amount was not be forfeited. In October, 2010, the complainant made a request to the Opposite Parties, to make payment of the policy amount, but she was advised to submit the bank account number, and also get her signatures attested, from the bank authorities. She complied with such instructions of the Opposite Parties, and sent the requisite information to them. It was stated that instead of transferring the amount to the bank account of the complainant, cheque No.852690 for Rs.58,916/-, drawn at Standard Chartered Bank, Pune, was issued, and a sum of Rs.16,084/- was forfeited from her account, without giving any detail/reason thereof. The complainant deposited the cheque, in her bank account. The bank debited a sum of Rs.50/-, to  her account, on account of attestation charges etc. It was further stated that, in this manner, the complainant suffered a loss of Rs.16,134/-(Rs.16084/-+Rs.50/-), during the period of 5 years, due to lapse, on the part of the Opposite Parties. A legal notice dated 7.5.2011, Annexure C-3, was also sent to the Opposite Parties, to redress the grievance of the complainant, but to no avail.       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 written version, stated that the complaint was barred by time. It was stated that the District Forum, at Chandigarh, had no territorial jurisdiction, to entertain and decide the complaint. It was further stated that, on the basis of the proposal form, duly signed by the complainant, the Opposite Parties, issued the policy aforesaid to her. It was further stated that, in case, she was dissatisfied with the terms and conditions of the said policy, she was required to issue a written notice to the Opposite Parties, for cancellation of the same, within free-look period of 15 days, from the date of receipt of the policy document, but she did not do so.  It was further stated that the policy, which was issued, on the basis of proposal form, filled up and signed by the complainant, was “Unit Gain” policy, which was duly received by her. It was further stated that the schedule of the policy bond clearly indicated that the premium was to be paid for 5 years. The yearly premium of Rs.25,000/- , was stipulated to be paid by the complainant, but she paid only three yearly premiums. The complainant did not pay the premiums due, as on 1.10.2008 and onwards. His surrender request was processed strictly, as per the terms and conditions of the insurance contract. It was denied, that the complainant was never informed, about the policy terms and conditions. It was further stated that every feature, benefit and terms & conditions of the policy were expressly mentioned, in the policy bond. It was further stated that after the surrender request of the complainant was considered and accepted, cheque in the sum of Rs.58,916/-, as surrender value, was sent to her, which she received, and got it encashed, without any protest or demur. It was further stated that a sum of Rs.16,084/-, was forfeited, in accordance with the terms and conditions of the policy.  It was further stated that neither there was 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, in the opening para of the instant order. 

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

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

8.               The Counsel for the appellant, submitted that, the proposal form Annexure R-1, was signed by the complainant, for obtaining life insurance policy. He further submitted that later on, the Opposite Parties, forged the second page of the proposal form, thereby showing that it was a Unit Gain Policy. It was further submitted that thereafter they issued the policy document. He further submitted that, according to Clause 2.2. of the policy document, no notice was issued to the complainant, to exercise her option, as to in which units, she wants to invest the amount of premiums. He further submitted that, under these circumstances, the complainant did not know, as to how, the amount of premiums for three years, deposited by the complainant, had been utilized by the Opposite Parties. He further submitted that no formula, on the basis of any tangible material/data, was worked out, by the Opposite Parties, so as to arrive at a conclusion, that the complainant was only entitled to Rs.58,916/-, as surrender value. He further submitted that even after 5 years, the complainant did not get the  amount of premiums, deposited by her, but, on the other hand, it had to suffer a loss, at the hands of the Opposite Parties, due to deficiency, in rendering service, as also indulgence into unfair trade practice. He further stated that the District Forum was wrong,  in coming to the conclusion, that the surrender value had been worked out, by the Opposite Parties, as per the terms and conditions of the Policy. He further submitted that the order of the District Forum, being illegal and invalid, is liable to be set aside.

9.               On the other hand, the Counsel for the respondents/Opposite Parties, submitted that Annexure R-1 proposal form, was duly signed by the complainant, after accepting the terms and conditions thereof, as correct. He further submitted that the second page of Annexure R-1, Proposal form, was not forged or manipulated, later on, by the Opposite Parties. He further submitted that the second page of the proposal form does not bear any cuttings or interpolations. He further submitted that even no allegation, whatsoever, was raised by the complainant, in the complaint, that the second page of the proposal form was forged by the Opposite Parties.  He further submitted that from Annexure R-1, the proposal form, it was evident, that it was a Unit Gain Policy. He further submitted that the complainant, herself, exercised the option for investment of 100% amount of premiums, in Equity Gain Funds. He further submitted that the features of the policy were duly mentioned, in the proposal form. He further submitted that, in case, the complainant was not satisfied with the terms and conditions of the policy, she could exercise the option for cancellation thereof,  within the free-look period of 15 days, from the date of receipt of the policy document, but she did not do so. He further submitted that the complainant only deposited three premiums of Rs.25,000/- each, and, thereafter, asked for the surrender of policy, and the payment of surrender value. He further submitted that on the date of the surrender of policy  i.e. 21.10.2010, the number of units in  respect thereof, was 1538.7946, NAV on the date was 38.2874  with surrender value of 58916.44437. He further submitted that the order of the District Forum, being legal and valid is liable to be upheld.

10.            After giving our thoughtful consideration, to the rival contentions, advanced by the Counsel for the parties, and the evidence, on record, we are of the considered opinion, that the appeal is liable to be dismissed, for the reasons to be recorded hereinafter. Admittedly, the proposal from Annexure R-1, was signed by the complainant. There is, no allegation, in the complaint, that the second page of Annexure R-1, proposal form, was forged or manipulated later on, by the Opposite Parties.  In the absence of any allegation, in that regard, the submission of the Counsel for the appellant/complainant, that the page aforesaid was forged later on, does not carry any weight. In the proposal form, it was, in clear-cut terms, mentioned, that it was a Unit Gain Policy. It is evident, from page 2 of Annexure R-1, proposal form, that the complainant, herself, exercised the option for investment for her premiums, to the extent of 100% in Equity Gain Funds. Under these circumstances, there was no reason, on the part of the Opposite Parties, to issue a separate notice, to the complainant, for exercising option, as per the provisions of Section 2.2. of the policy document, as to in which fund, she wanted to invest her premium amount. The complainant only paid a sum of Rs.75,000/-, for a period of 3 years. Thereafter, she failed to pay the premiums, and requested for the surrender of policy. Annexure C-2  is the policy document. At page 22/40 of the policy document under the column “Surrender”, it is mentioned as under:-

“The Surrender Value of the policy will be equal to the bid value of the units calculated in the same manner as if the Units are to be cancelled.  The Policy shall thereafter terminate upon payment of the full surrender value by the company.  The policy will acquire a surrender value after payment of 3 full year’s premium.

For policy year 4 and above the company may impose surrender penalty of upto a maximum of 10% of the bid value of units subject to approval of the IRDA”.

11.            As stated above, since the complainant had surrendered the policy, after payment of premiums, for three years, she was certainly entitled to the surrender value. Risks of investment in the Units of the funds in Annexure C-2, at pages 22/40 and 23/40, are mentioned, as under:-

“The Policy holder/Life Assured is aware that the investment in the Units is subject to the following, amongst other, risks and agrees that he is making the investment in the Units with full knowledge of the same.

1)           Unit Linked Policy is only the name of the Policy and does not in any way indicate the quality of the policy, its future prospects or returns.

2)         Equity Fund, Balanced Fund, Debt Fund and Cash Funds are the names of the funds and do not in any manner indicate the quality of the fund, their future prospects or returns.

3)           The investments in the Units are subject to market and other risks and there can be no assurance that the objectivities of any of the funds will be achieved.

4)           The Units Value of the Units of each of the funds can go up or down depending on the factors and forces affecting the financial and debt markets from time to time and may also be affected by changes in the general level of interest rates.

5)           The past performance of other funds  of the Company is not necessarily indicative of the future performance of any of these funds.

6)        The funds do not offer a guaranteed or assured return.

7)      All benefits payable under the Policy are subject to the tax laws and other financial enactments, as they exist from time to time”.

It was on the basis of various sections, contained in the policy,  that the surrender value was worked out. In the written reply,  at page 46 of the District Forum file, the date of surrender was mentioned as 21.10.2010, the date of utilization was mentioned as 21.10.2010. The number of units in respect of the policy was mentioned as 1538.7946. NAV on the date was 38.2874, on the basis of aforesaid factors/formula, the surrender value came to be Rs.58916.44437. The averments, contained in the written version of the Opposite Parties, were duly corroborated, through the affidavit of Mr. Rajinder Singh Kalsi, Zonal Legal Manager, Bajaj Allianz Life Insurance State Consumer Disputes Redressal Commission, U.T., Chandigarh, Chandigarh, submitted by way of evidence. Since, it was a Unit Linked Policy, the investment risks were to be borne by the policy holder only. The surrender value was rightly worked out by the Opposite Parties, as per the terms and conditions of the policy. The Opposite Parties, thus, were right in issuing the cheque of Rs.58,916/-, as surrender value, in favour of the complainant, which was duly got encashed by her without any demur. Thus, there was no deficiency, in rendering service, on the part of the Opposite Parties.

12.             The cheque aforesaid, was sent to the complainant on 25.10.2010. She got the same encashed,  without any protest or demur. In case, the complainant had any grouse, she could raise the same, at the time of receipt of the cheque, in respect of surrender value. She could even refuse to accept the same, on the ground, that  it was not, in accordance with the terms and conditions of the policy. After accepting the cheque,  and getting it encashed, the complainant, slept over the matter, for about one year, and, ultimately, came to the District Forum, by way of filing complaint on 05.08.2011. It was only an afterthought decision, taken by the complainant, to file the complaint, on the ground, that there was deficiency, in rendering service, on the part of the Opposite Parties.  This fact can also be said to be sufficient, to come to the conclusion that the complainant was satisfied with the surrender  value cheque, received by her and got encashed by her, but later on, for the reasons best known to her, after about one year, she came to the District Forum, for filing the complaint. This also clearly goes to prove, that there was no deficiency, in rendering service, on the part of the Opposite Parties.

13.            No other point, was urged, by the Counsel for the parties.

14.            In view of the above discussion, it is held that 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.

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

16.            Certified Copies of this order be sent to the parties, free of charge.

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

Pronounced.

May 11, 2012

Sd/-

[JUSTICE SHAM SUNDER]

PRESIDENT

Sd/-

[NEENA SANDHU]

MEMBER

Rg