REKHA GUPTA, PRESIDING MEMBER

                Revision Petition nos. 123, 124 and 1260 of 2016 have been filed against a common order dated 03.11.2015 of the Rajasthan State Consumer Disputes Redressal Commission (‘the State Commission’) in Appeal nos. 1053 and 1074 of 2013.

2.     For the reasons stated in the condonation of delay application, the delay is condoned.

3.     As the facts of the case are common in all the revision petitions, we propose to pass a common order with Revision Petition no. 123 of 2015 being the lead case.

4.     The facts of the case as per the respondent/ complainant are that the husband of the complainant Harilal Meena had a truck bearing no. J 29 GA 1163 which he had financed through TATA Finance Company. Subsequent to that the petitioner/opposite party took over his loan and paid an amount of Rs.3,60,000/- to Tata Finance Company and accepted the loan of Rs.4,60,000/- on this truck in total. On 25.07.2012 Harilal was made to undertake a Credit Shield Insurance Policy of amount of Rs.12,227/- for securing the loan under the policy name ‘B’. On 18.08.2012 the husband of the respondent died, subsequent to which the petitioner had not returned the truck of the respondent, neither had they paid the loan from the amount of the insurance policy, nor refunded the residual amount from the approved loan amount. The respondent filed a complaint before the District Consumer Disputes Redressal Forum, Dausa, Rajasthan prayer for the following:

1.     The respondent be returned the truck from the possession of the petitioner bearing no. RJ 29 GA 1163;

2.     The respondent be given NOC from the petitioner by waiving of the full amount of the loan under the Credit Shield Insurance Policy;

3.     The respondent be refunded full outstanding amount from the sanctioned amount of Rs.4,60,000/- after deducting all the expenses from the petitioners;

4.     On account of vehicle of the respondent being in possession of the petitioner the respondent has to suffer a loss of Rs.2000/- daily. From the date of taking of possession of vehicle by the petitioner to the date of handing over the possession to the respondent, compensation at the rate of Rs.2000/- per day be given to the respondent from the petitioners;

5.     The physical and mental torture and pecuniary loss as suffered by the respondent on account of the act of the petitioner amounting to deficiency in service and recklessness the respondent be awarded an amount of Rs.1,00,000/- as damages;

6.     Rs.5,000/- be awarded to the respondent and given by the petitioner as compensation towards the commutation;

7.     Rs.10,000/- be awarded to the respondent towards expenses for notice, case and fee of the advocate from the petitioner; and

8.     Any other relief which is in favour of the respondent be passed.

5.     In reply, the petitioners have stated that the husband of the respondent was approved a loan amount of Rs.4,60,000/-. In paragraph 6 of the reply it was stated that for the Credit Shield Policy the petitioners have not received any amount of cash from the husband of the respondent but the premium amount of Rs.12,227/- was deposited to Sriram Life Insurance Company from the loan amount as sanctioned to the husband of the respondent. The respondent bears no relation of a consumer with the company so the case of the respondent was fit to be rejected. The petitioner had never promised to the respondent that all the formalities would be completed within one month and outstanding amount would be refunded but had instructed her to furnish a succession certificate as per law from the competent court. Succession certificate has not been presented by the respondent so no further action could be taken. Further, the company was entitled to get maintenance expenses @ Rs. 5000/- per month as the same amount was being spent by the company on maintenance of the truck. Premium of the Credit Shield Policy has already been given to Sriram Life Insurance Company so all the responsibilities towards payment was of the said company. The period of the said policy was from 28.09.2012 to 27.09.2016. Harilal has died before the commencement of risk of the said policy and before the said policy came into existence. Thus, the petitioner has not committed any deficiency in service towards the respondent and prayed that the complaint be dismissed with cost.

6.     The District Consumer Disputes Redressal Forum, Dausa, Rajasthan (‘the District Forum’) vide its order dated 18.09.2013 while allowing the complaint observed as under:

“We took under consideration the said arguments of the respondent and perused the record. Respondent states that the risk cover of the said policy has started from 28.09.2012. The complainant has produced the premium deposit receipt in relation to the said policy. Respondents maintain that the premium amount was not deposited by the husband of the complainant in cash but the respondents have deposited the said premium amount from the finance amount itself. On perusal of the said receipt it is clear that the premium amount for the said insurance was debited to the account of Harilal by the respondents on 25.07.2012 then for what reasons the risk cover under the insurance policy was started from 28.09.2012. No satisfactory explanation has been given by the respondents of the said facts. In our opinion, commencement of risk takes place from the date of deposit of premium amount. From the said statement of the respondents it is evident that they have deducted the premium amount amounting to Rs.12,227/- on 25.07.2012 from  the loan amount of husband of the complainant whereas the respondents have deposited the same amount with the insurance company on 28.09.2012. In this way the said acts of the respondents proves the deficiency in service towards the complainant and also proves that in the said case the risk cover under the insurance has started from the date of deposit of premium amount on 25.07.2012. In the receipt issued by the respondent bearing no. A E 6731628 dated mentioned is 25.07.2012, Credit Shield amount Rs.12,227/- Insurance Deposit Toweards proposal no Dausa 1207240002 vehicle no. RJ 29 GA 1163 is mentioned explicitly. So from the date of proposal commencement of risk cover will be considered.

From the analysis of the above, it is clear that the risk cover under the insurance policy of the husband of the complainant has started from 25.07.2012 and the fact of death of policy holder on 18.08.2012 is an accepted fact without any dispute. Thus death of the policy holder has occurred after the deposition of premium amount on 25.07.2012 so death has occurred during the period of the policy so in our opinion the complainant is entitled to get every benefit under the insurance policy as given. The complainant states that as per the insurance policy the outstanding loan against her husband is to be waived of completely and issuance of certificate of full settlement of loan and the disputed vehicle which under possession of the respondent be returned to the complainant, and in the loan amount as sanctioned if any amount is outstanding then the same be paid to the complainant. In reference to the said insurance policy parties have not presented the terms and conditions. Under the said policy the complainant is entitled to received certificate of full settlement of loan by complete waiver of loan against her husband, for the possession of disputed vehicle which is under possession of the respondents.

Respondents have acted as an agent of the insurance company. Respondents and Sriram Life Insurance Company are companies of one group that is Sriram group and by reasons of inter nexus they operate in the market for benefit of one another. Premium amount of the said insurance policy is deposited in the office of the insurance company so the complainant is entitled to waiver of the outstanding amount of the loan from the respondents and the complainant is further entitled to get Rs.2,000/- from the respondent as litigation expenses.

Order

Thus the case as presented by the complainant under Section 12 of the Consumer Protection Act, 1986 against the respondents is accepted and following order is passed:

1. Respondents to issue certificate of full settlement of loan by waiver of the outstanding amount the loan under the said policy against the husband of the complainant;
2. The respondent to give possession of the vehicle under dispute within one month to the complainant without any cost;
3. The respondents are entitled to recover the outstanding amount of loan against the truck from Sriram Life Insurance Company as per law; and
4. Respondents to pay Rs.2,000/- to the complainant as litigation expenses”.

7.     Thereafter two appeals were filed in the State Commission, Appeal no. 1053 of 2013 was filed by the respondent/ complainant for enhancement of the award of the District Forum and appeal no. 1074 of 2013 was filed by the petitioner/ opposite party challenging the order of the District Forum. Both these appeals were disposed of by the State Commission by a common order. The State Commission in their order dismissed appeal no. 1074 of 2013 filed by the petitioner as devoid of merit and allowed the appeal no. 1053 of 2013 by giving following order:

“We agree with the conclusion of the District Forum that this insurance policy was taken from Sriram Life Insurance which is a part of Sriram group of companies and nexus between them is natural/ inevitable and when the appellant was instructed to bring death certificate then on 28.09.2012 there was no point taken in the policy and they had come to know that Harilal had died. So we agree with conclusion of the District Forum. Deficiency in service of the respondent company is proved. Appeal no. 1074 of 2013 of the respondent is devoid of any merit and is fit to be rejected.

Appeal no. 1053 of 2013 is presented by Appellant. We agree with the argument of the counsel of the appellant that they should be awarded compensation. In our opinion when the District Forum has accepted the deficiency in service of the respondent then, appellant should have been given compensation for mental torture suffered by the appellant. As we have mentioned above that the respondent company had the knowledge of fact of death of Harilal, but they have credit shield policy on 28.09.2012 premium of which they have taken on 25.07.2012. So we consider this appeal fit to be admitted and modify the award as passed by the District Forum and pass an order that the respondents will pay Rs.25,000/- to the appellant for mental torture and as compensation. Rest part of the order is kept as it is”.

8.     In their order, the State Commission has held that:

“In our opinion not making the insurance company a party to this case and not presenting any certificate of succession are technical defects. For taking the credit Shield Insurance Policy against this loan the respondents had taken the premium amount from the husband of the appellant, the copy of the said policy was never sent to the litigant/ appellant. The appellant could not have known that this insurance policy was taken from this company. Objection in relation to non-presentation of certificate of succession was also technical in nature, because the appellant was a beneficiary consumer and she was entitled to bring such a case. Presenting any such objection before the District Forum was not evident. At present the appellant had also died and her sons have been replaced as a party to this case.

This fact was not disputed that the respondents had received a sum of Rs.12,227/- from Harilal as premium to the Credit Shield Insurance Policy taken against this loan and the receipt of the same was issued bearing no. 671628 but the respondent have received this policy on 28.09.2012 meaning thereby that for period of two months this policy was not taken and during this period only Harilal died. The fact that the registration of truck and hypothecation was in the name of the litigant dated 24.08.2012 makes no difference in our opinion. Generally such formalities are taken care of by finance companies on their own level. All the documents and terms and conditions relating to loan, the customer was made to sign from which it can be deciphered that when the loan was accepted then on 25.07.2012 all the formalities relating to hypothecation of the truck was completed by the company through the signature of Harilal but subsequently neither the policy was taken on time nor was any formality done in transport office. This cannot be accepted that hypothecation of the truck was done after the death of Harilal. The respondent have not been able to give satisfactory answer as to why credit shield insurance was not taken after taking premium from Harilal on 25.07.2012. As far as the question of information of death of Harilal was concerned in the present case the appellant had clearly mentioned that after the death of Harilal on 18.08.2012, the death certificate of Harilal was produced before the respondent company and as per the insurance policy, request for NOC over loan and return of the truck was requested. Respondent had assured that they will complete all the formalities within one month. This pleading was never refuted in the reply given by the respondent company before the District Forum. In paragraph 7 of the reply it is evident that the appellant, herself went to the respondent but they had instructed to bring the death certificate”.

9.     Hence, the present revision petitions.

10.    Revision petition nos. 123 of 2016 and 124 of 2016 have been filed by the petitioner/ opposite party challenging the order of the State Commission which dismissed the appeal and RP no. 1260 of 2016 has been filed by the respondent/ complainant for enhancement of compensation awarded by the State Commission.

11.    We have heard the learned counsel for the parties. Counsel for Shriram Transport Finance Company Ltd., Mr Shailesh Madiyal has contended that the State Commission has erred in not appreciating that the entire dispute/ grievances of the respondent/ complainant was with a third party insurance company and not with the petitioners. The insurance company was however, not even made a party in the complaint. The State Commission erred in rejecting this objection on the completely untenable basis that there is some likelihood of a ‘nexus’ between the insurance company and the finance company/ petitioner herein. It is submitted that Shriram Transport Finance Co., is entirely distinct from the Shriram Life Insurance Co. Ltd.

12.    The State Commission has failed to consider the point of law that there was no privity of contract between the parties in so far as the insurance policy is concerned and therefore no duty of case can be fastened on the petitioners in respect of the insurance policy in question.

13.    The State Commission erred in not appreciating that at the time of death of the said Harilal Meena, there was no insurance policy at all, although the premium is said to have been paid. The State Commission erred in attributing the delay in obtaining the insurance policy to the petitioners herein and drawing an adverse inference on account of the petitioners not having been able to explain the cause of the delay. It is submitted that it is not the petitioners who are to issue the insurance policy and it is in fact the insurance company (Shriram Life Insurance Co. Ltd.). The insurance policy came into effect after the death of complainant’s husband and the complainant cannot derive any benefit on account of such a policy.

14.    The State Commission had erred in coming to the conclusion that the objection taken by the petitioners that the respondent/ complainant had not provided the succession certificate as a result of which the truck could not be released was a technical objection. It is submitted that in the absence of the succession certificate, the petitioners had no way of knowing as to who were the genuine legal heirs of the deceased Harilal Meena and therefore, the succession certificate was imperative.

15.    Learned counsel for Smt Bhagoti – Ms Archana Pathak Dave, on the other hand has argued in favour of the State Commission’s order, but however, held that despite the order of the District Forum, the truck has not been returned to the respondent and they are suffering huge loss, and the compensation awarded by the State Commission is too meagre and ought to be enhanced. It was further stated that the vehicle has been lying with the petitioner for many years and is in a dilapidated condition and lot of money will have to be spent to make it roadworthy and further, they have been fighting the case in various fora for which they have been dragged by the petitioner.

16.    We have carefully gone through the record. Counsel for the Shriram Transport Finance Company Ltd. had contended that information of death was not given. However, we find that in paragraph 7 of the complaint reads as under:

“That after the death of Harilal on 18.09.2012 the complainant presented the death certificate of Harilal in the office of the respondents and requested for grant of NOC and waiver of the entire loan under Credit Shield Insurance Policy taken on the said vehicle that is truck bearing no. RJ 29 GA 1163 then the respondents assured the complainant that within one month all the formalities would be completed and she would be given the NOC and her vehicle would be returned and the outstanding amount of the loan would also be refunded to her. The complainant furnished all the desired documents to the respondents as demanded by them”.

17.    The fact that, after the death of Harilal, the complainant had presented the death certificate in the office of respondent and requested for grant of NOC waiver has not been denied by the petitioner in their reply before the District Forum. The petitioner in their written statement before the District Forum, stated as under:

“That the statements as described in paragraph 7 are wrong is denied. The respondents have never promised that loan amount would be refunded within one month after completing all the formalities but had instructed that succession certificate be furnished as per law from the competent court. On account of non-presentation of the succession certificate by the complainant further execution could not be done for which the complainant herself is responsible.”

18.    Hence, the State Commission has rightly concluded that “as far as the question of information of death of Harilal is concerned in the present case the appellant has clearly mentioned that after the death of Harilal on 18.08.2012, the death certificate of Harilal was produced before the respondent company and as per the insurance policy request for NOC over loan and return of the truck was requested. Respondent had assured that they will complete the formalities within one month. This pleading was never refuted in the reply given by the company before the District Forum. We agree with the conclusion of the District Forum that the insurance policy was taken from Sriram Life insurance which is a part of Sriram Group of companies and nexus between them is natural/ inevitable and when the appellant was instructed to bring the death certificate and succession certificate then on 28.09.2012 there was no point taken in issuance of the said policy once they had come to know that Harilal had died”.

19.    We have carefully seen the certificate of insurance filed by the petitioner, which reads as under:

CERTIFICATE OF INSURANCE

          This is to certify that the person named (hereunder/hereafter called the insured member) is insured subject to the terms and conditions of the policy number GN0111000000313 under the plan Shriram Credit Shield issued to Shriram Transport Finance Company Limited (hereafter called the master policy holder) by Shriram Life Insurance Company Ltd./ hereafter called the Company):

Note:

*        Please contact the policy holder for the details of the terms and conditions of the policy;

*        You will be eligible to receive a proportionate premium on prepayment of your outstanding loan or on transfer of loan to some other company;

*        The cover excludes suicide, whether same or insane, within one year from the effective date of cover;

*        For claiming, the death certificate of the member should be submitted in original along with this certificate of insurance and the claim form which will be available with the master policy holder, at the above address;

*        The above certificate is issued for information but it is not a policy document;

*        Serial Number 10506.”    

20.    From the above, the following facts are clear and evident that the petitioner had been issued a master policy by the Shriram Life Insurance Company Ltd., they were the master policy holders. In the said policy, name of the policy holder has been mentioned as Shriram Transport Finance Company Limited and name of the insured member as Harilal Meena. As per the certificate, the insurance cover start date is mentioned as 28.09.2012 and the policy was issued on 16.10.2012. Note below the certificate of insurance makes it clear that for claiming the insurance policy, the beneficiary has to contact the policy holder for the details of the terms and conditions of the policy which in this case is the petitioner.

21.    In all such case where master policy is held by a company for the benefit of their employees or people taking loan or in this case where the insured member who had taken loan, the master policy holder has to collect and remit the premium as also the details of the insured to the insurer for issue of the certificate of insurance. In this case the master insurance policy no. GN0111000000313 was in the name of Shriram Transport Finance Company Ltd. The policy holder was bound to collect the premium from the beneficiary and forward his name to the Shriram Life Insurance Company Ltd., for issuing certificate of insurance in favour of the insured member. In this case, the petitioner has admitted that the premium was collected from Harilal Meena on 25.07.2012. Learned counsel for petitioner, however, could not give us the date on which information regarding collection of premium from Harilal Meena along with the details of Harilal Meena were forwarded to Shriram Life Insurance Company Ltd., for issue of the certificate of insurance.  It is also apparent from the records on the file that it is only after the information of death of Harilal Meena was given to the petitioner that the certificate of insurance was issued on 16.10.2012 with the cover start date of 28.09.2012.

22.    In view of the above, the petitioner and the counsel has failed to explain as to when the premium as also information regarding extension of insurance cover of Harilal Meena was sent to the insurance company. They have failed to controvert that they were given the intimation regarding the death of the insured and all the documents of Harilal Meena by his wife when she visited their office. They also failed to explain why the certificate of insurance was issued on 16.10.2012 when the premium was taken on 25.07.2012.

23.    In view of the above, we find that no jurisdictional or legal error has been shown to us in the impugned order to call for our interference under Section 21 (b) of Consumer Protection Act, 1986.  The order of the State Commission does not call for any interference nor does it suffer from any infirmity or erroneous exercise of jurisdiction or material irregularity. Hence, revision petition nos. 123 and 124 of 2016 are dismissed. Revision petition no. 1260 of 2016 filed by Bhagoti Devi (Deceased) through her LRs is allowed, as the truck is still lying with the petitioner and the petitioner has dragged the respondent from one court to the another for over four years, hence, we partially modify the order of the State Commission and enhance the compensation from Rs.25,000/- to rupees one lakh and cost of litigation expenses from Rs.2000/- to Rs.10,000/-.