1.       The present Revision Petition (RP) has been filed by the Petitioner against Respondent as detailed above, under section 21 of Consumer Protection Act 1986, against the order dated 17.05.2016 of the State Consumer Disputes Redressal Commission Rajasthan (hereinafter referred to as the ‘State Commission’), in First Appeal (FA) No.85 of 2015  in which order dated 17.04.2015 of Udaipur District Consumer Disputes Redressal Forum (hereinafter referred to as District Forum) in Consumer Complaint (CC) no. 161 of 2014 of was challenged, inter alia praying for setting aside the order dated 17.05.2016 of the State Commission.

2.       While the Revision Petitioners (hereinafter also referred to as OPs) were Respondents and the Respondent (hereinafter also referred to as Complainant) was Appellant in the said FA No. 85 of 2015 before the State Commission, the Revision Petitioners were OPs and Respondent was Complainant before the District Forum in CC no. 161 of 2014.  Notice was issued to the Respondent on 25.10.2016.  Parties filed their Written Arguments/Synopsis.  

3.       Brief facts of the case, as emerged from the RP, Order of the State Commission, Order of the District Commission and other case records are that Complainant purchased insurance policy from the OP(s) on 14.11.2002 under  the plan 47-25 amounting to Rs.5.00 lacs and its premium was payable yearly.  It is the case of the complainant that in proposal form which was filled and signed by him, cutting was made by agent of the OPs who changed the plan to 47-15 from 47-25 and insured amount of Rs.5.00 lacs was changed to Rs.2.00 lacs.  Premium period was also changed from yearly period to half year period.  Even, cutting was made on the date of depositing the amount.  According to the complainant, the said plan was for 25 years but the said agent made it to 15 years.  Insured amount and premium amount were also got changed.  As per the complainant, the agent attested his signatures on the cuttings.  The complainant, being aggrieved of the said act, filed CC before the District Forum and District Forum vide order dated 17.05.2015 dismissed the complaint of the complainant. Being aggrieved, the Complainant filed an Appeal before the State Commission, who allowed the Appeal of the Complainant vide order dated 17.05.2016.  Therefore, the OPs are before this Commission now in the present RP.

4.       Petitioners have challenged the said Order dated 17.05.2016of the State Commission mainly on following grounds:

4.1     At the time of obtaining the policy, letter was sent to the respondent informing and requesting to go through the terms and conditions of the policy and in case,  respondent disagrees to any terms and conditions of the policy,  he can return the policy within 15 days stating the reasons of objection on receipt of policy and amount of premium will be refunded after deducting the risk premium and charges for medical examination and stamp duty.  The respondent never objected for the same in the long time span of about 10 years.

4.2.    Amendments were made in the policy with the consent of respondent and amendments were duly signed by the respondent.

4.3.    Respondent deposited all the premium according to the plan i.e. Rs.6578/- half yearly for 10 years and the respondent accepted the policy after knowing all the amended facts of the policy revived at the time of obtaining it on 15.05.2006.

4.4.    The age of the respondent was 53 years at the time of proposal and respondent proposed to take the plan for 25 years.  In that case the maturity of the respondent would be at the age of 78 years which was not allowed plan.  Therefore, it was reduced to 15 years because the maximum maturity age can be 70 years of the assured and agent cannot go beyond the terms and conditions of the said plan.

4.5.    If there is amendment made by an agent in policy maturity tenure from 25 years to 15 years due to norms of the plan, then several other amendment must have been made in accordance to that plan like sum assured from Rs. 5.00 lacs to 2.00 lacs, amount of instalment i.e. R s.6028 yearly to Rs.6578/- half yearly.

5.       Heard counsels of both sides.  Contentions/pleas of the parties, on various issues raised in the RP, Written Arguments, and Oral Arguments advanced during the hearing, are summed up below.

5.1.    Counsel for the Petitioner argued that due to age factor, the policy was amended with consent of the Policy holder. The amended plan was  T&T 47-15, sum assured was Rs.2,00,000/- and Rs.6578/- half yearly premium for 10 years.  Further, policy was issued in the year 2003 and life assured did not avail Free Lock Cancellation facility.  Further, due to lapse in paying the policy premium, the policy was revived on request of Complainant on amended terms and conditions. 

5.2.    It is further argued that reply to complainant’s letter was sent stating that there is no provision regarding increase in sum assured under the rules provided by IRDA and terms of premium is half yearly which is clearly stipulated in the policy. The Respondent submitted a complaint to Insurance Ombudsman  Even the Insurance Ombudsman decided the matter in favour of LIC stating that policy holder could have utilized the free look period.  The Respondent filed complaint after huge gap of two years from the decision of Insurance Ombudsman.

5.3.    Counsel further argued that State Commission overlooked the fact that the difference of premium was not a minor difference.  The insured was well aware about the plan which was amended.  Further, due to age factory, the policy was amended with consent of the policy holder.  The amended plan was T& T 47-15, sum assured was Rs.2.0 lacs and for which he was paying Rs.6578/- half yearly premium for 10 years, so the insured knew it better about the policy as he was paying double the amount of premium.  Further, the policy holder could have utilized the ‘Free Look Period’ but respondent never objected the policy for the same in the long time span of about 10 years.   It is further argued that there was no such provision like secured benefit of 8 %.   Reliance is placed on the following judgments of Hon’ble Supreme Court / National Commission :

a.       M/s Philips Medical Systems ( Cleveland) Inc. Vs. M/s Indian MRI Diagnostic & Research Ltd. & Anr., Civil Appeal No. 2461 of 2006

b.       2016 SCC Online NCDRC 2627, RP No. 303 of 2016

c.       2016 SCC Online NCDRC 2520, RP No. 2004 of 2016

d.       2015 SCC Online NCDRC 1650, RP No. 4351 of 2014

e.       2014 SCC Online NCDRC 23, RP No. 1607 of 2011.

5.4.    Counsel for the respondent argued that without written request and signature on application / proposal, the respondent changed ex part original and important conditions of proposal form by their representatives.  Further, the Petitioner and their agent made changes without the consent of the proposer, which is serious fault.  Insurance Company/agent/representative have to inform in writing but Petitioner issued policy as per changed conditions by agent putting his signatures.  The Provision of cooling off option was not mentioned in the policy.  The Petitioner also changed the original insurance proposal without the consent and knowledge of proposer.  The material information regarding economic benefits in original insurance proposal is a serious fault in services. 

6.       We have carefully gone through the orders of the State Commission, District Forum, other relevant records and rival contentions of the parties.  Extract of relevant pars of the order of the State Commission is reproduced below:

“In our opinion, the insurance company issued the policy inspite of cutting in the proposal form. Though signatures have been put on the cutting by the agent of the insurance company but signatures of proposer should also be there on the cuttings.  At the time of issuing the policy, the insurance company was to ensure if these cuttings are infact true or not.  After filling the proposal form, cuttings were made on the proposal form by agent and office and thereafter, issuing a policy cannot be said to be in good faith.  It is true that proposer after getting the policy, did not go through its contents .  In normal course, the policy holders do not read the contents of the policy while they do not have any doubt about the conditions.  The complainant was not in doubt for the reason that he was told about the yearly premium of about Rs.5100/- .  It is the say of the complainant that agent told that there could be some difference in premium calculation and so he kept on paying the premium.  It was not in his knowledge that  insured amount and insurance period has been reduced.  We are not in agreement with the decision of  Ld. District Forum that insured should have read the policy conditions after getting the insurance policy. Insurance agreement in based on good faith but the Insurance Company ignored the said principal.

Though the policy has remained in force for 15 years, in our opinion, it is not proper to make changes as policy is maturing next year in 2017 and complainant will be getting all the benefits.   It is deficiency in service on the part of the insurance company that they issued the policy without verifying the cuttings made on the main contents of the proposal form i.e. insured amount and insurance period from the insured.  Ordinarily, agent does this for their Commission and insurance company also issued the policy for increasing their business purposes.  Therefore, for this deficiency in service, we think it proper that complainant should be awarded Rs.1,50,000/- for damages and Rs.21,000/- for appeal expenses and also think it proper to set aside the order of Ld. District Forum.

In the result, on the basis of above discussion, the appeal of the appellant is accepted and order of the District Forum dated 17.04.2014 is ordered to be set aside and  Insurance Company to pay Rs.1,50,000/- for damages and Rs.21,000/- for appeal expenses.  Order to be complied within one month.

7.       During the hearing, it was informed that the said policy has since matured and the maturity amount under the said policy has been received by the respondent.

8.       We are in agreement with the observations of the State Commission with respect to the deficiency in service on the part of the Petitioner-Insurance Company.  As was held by the Hon’ble Supreme Court in Rubi Chandra Dutta Vs. United India Insurance Co. Ltd. [(2011) 11 SCC 269], the scope in a Revision Petition is limited. Such powers can be exercised only if there is some prima facie jurisdictional error appearing in the impugned order. In Sunil Kumar Maity Vs. State Bank of India & Ors. [AIR (2022) SC 577]  held that “the revisional jurisdiction of the National Commission under Section 21(b) of the said Act is extremely limited. It should be exercised only in case as contemplated within the parameters specified in the said provision, namely when it appears to the National Commission that the State Commission had exercised a jurisdiction not vested in it by law, or had failed to exercise jurisdiction so vested, or had acted in the exercise of its jurisdiction illegally or with material irregularity.”.  There is no illegality or material irregularity or jurisdictional error in the order of the State Commission, hence the same is upheld.  Accordingly, Revision Petition is dismissed.

9.       The pending IAs in the case, if any, also stand disposed off.