Punjab

StateCommission

A/120/2017

Aviva Life Insurance Company - Complainant(s)

Versus

Charan Singh - Opp.Party(s)

Pankaj Chandgothia

26 Sep 2017

ORDER

                                                                    2^Nd ADDITIONAL BENCH

STATE  CONSUMER  DISPUTES  REDRESSAL COMMISSION, PUNJAB, CHANDIGARH.

First Appeal No.120 of 2017

                                                          Date of Institution: 20.02.2017

                                                          Order Reserved on : 11.09.2017

                                                          Date of Decision:     26.09.2017

1. Aviva Life Insurance Company India limited, 5^th Floor, JMD regent square, Gurgaon, Mehrauli Road, Gurgaon-122001.
2. Aviva Life Insurance Company India Limited, Ladhewali Road, Infront of Suvidha Centre, Near Tribune Office, Jalandhar, Both through their authorized signatory/Senior Executive (legal) Ratnesh Keshri Available at Aviva Towers, Sector Road, opposite Golf Course, DLF, Phase V, Sector 43, Gurgaon (Haryana).

                                                       Appellants/Opposite parties no.1&2

Versus

Charan Singh aged about 71 years s/o Sh. Gurdas Singh, village Kamalpur, PO Miani, Tehsil Dasuya, District Hoshiarpur.                                                                                                Respondent/complainant   

First Appeal against order dated 12.01.2017 passed by the District Consumer Disputes Redressal Forum,  Hoshiarpur.

Quorum:-

          Shri Gurcharan Singh Saran, Presiding Judicial Member.

         Shri Rajinder Kumar Goyal, Member 

Present:-

          For appellants                       :         Sh. Sanjeev Goyal, Advocate

          For respondent                      :         Ms. Jyoti Sareen, Advocate

 

RAJINDER KUMAR GOYAL MEMBER

ORDER

                    The appellants/opposite party No.1&2 (hereinreferred to as OPs) have filed the present appeal against the order dated 12.01.2017 passed in Consumer Complaint No.128 of 2016 by the District Consumer Disputes Redressal Forum, Hoshiarpur (herein referred as District Forum) vide which the complaint filed by the complainant was accepted and Ops were directed to make the payment of insured maturity amount of Rs.5,00,000/- with interest @ 9% per annum from 21.10.2015 till realization and further the Ops were directed to pay litigation expenses of Rs.3000/- to  the complainant. The compliance was to be made within one month from the date of receipt of the copy of the order.  

2.               Complaint was filed by the respondent/complainant (hereinafter referred as complainant) under Consumer Protection Act, 1986 (in short, "the Act") against the OPs on the averments that the complainant is under matric and retired from Telephone Department on 31.08.2005 and got retirement and other benefits. He was interested to make investments of his finance. An agent of the Ops Karamvir Singh Sandhu met him in Punjab and Sind Bank Handowal District Hoshiarpur and convinced him to get the policy and assured that he will get Rs.5,00,000/- on the date of maturity if he invests Rs.1,00,000/-. Being convinced from the agent of the OPs the complainant hired the services of opposite party No.2 and paid Rs.1,00,000/- on 21.10.2005 and received a receipt. Then he received the policy bearing the No.LBH1193646 after about one year. When he inquired about the policy documents he came to know that the date of commencement of the policy is 20.02.2006 and maturity date is 20.02.2016 after ten years whereas the complainant hired this policy and paid the consideration on 21.10.2015. The date of commencement should be 21.10.2005 and not 20.02.2006. The complainant approached the opposite party to redress his grievances.  He got issued a registered legal notice to the opposite party on 21.12.2013 but of no avail. Ultimately he filed a complaint before the District Forum vide complaint No.21/27/01/2014 mentioning the various grievances of complaint which was decided on 04.07.2014, with the direction to the OP to change the commencement of the policy from 20.02.2006 to 21.10.2005 with costs of Rs.5000/-. The opposite party accordingly sent a new policy with the corrected date of commencement of policy and maturity.

                   After the policy had matured on 21.10.2015 the complainant did not receive any information about the maturity and did not receive the matured amount. He received a letter dated 16.12.2015 informing the complainant that the policy was going to mature on 20.02.2016 and also mentioning the policy No.00854020 whereas the date of maturity according to the new policy issued by the Ops was 21.10.2015 and the policy number was LBP1193646 Mark C-3. It seemed that the letter send by the opposite party was not concerning the policy of the complainant. The complainant approached the Ops to accept his claim and to pay Rs.5,00,000/- along with interest from 21.10.2015 but they were not listening to the complainant and refused to pay the policy amount. As such complainant filed the complaint before the District Forum with the prayer to direct the opposite parties to pay Rs.5,00,000/- the matured amount of the policy alongwith other bonus and benefits, interest from 21.10.2015 and cost of litigation.

 3.               Notice of the complaint was given to the Ops Sh. Rohit Joshi, Advocate appeared and filed memo of appearance on behalf of the Ops on 09.09.2016 but thereafter on the next date none had put in appearance for and on behalf of Ops and ultimately, ops were proceeded against ex-parte on 21.09.2016.

                   The complainant in its evidence before the District Forum tendered the affidavit as Mark C-1, maturity intimation letter as Mark C-2, copy of policy schedule as Mark C-3, copy of order dated 04.07.2014 as Mark C-4 and closed the ex-parte evidence on behalf of the complainant. When the case was fixed for ex-parte arguments then the counsel for the Ops filed an application with a prayer to allow to join the proceedings which was allowed on 02.12.2016 at the stage of arguments.

4.                After going through the averments as alleged in the complaint, evidence and documents brought on record, the complaint filed by the complainant was allowed as referred above.

5.                Aggrieved with the order passed by the learned District Forum the appellants/OPs have filed the present appeal.

6.                We have heard the learned counsel for the appellants/Ops and respondent/complainant and have persued the record carefully.

7.                It was argued by the counsel for the OPs that the District Forum wrongly and illegally ordered the appellant to pay insured maturity amount of Rs.5,00,000/- with interest at the rate of 9% per annum from 21.10.2015 till realization and lost sight of the fact that under the policy nothing is mentioned as maturity amount of Rs.5,00,000/- rather complainant was having sum insured of Rs.5,00,000/- under the policy and said amount was payable in case of unfortunate death of insured otherwise the complainant invested the amount of Rs.1,00,000/- under single premium policy, therefore, he was only entitled to get the policy value on the maturity of the policy but the District Forum did not consider the said fact and treated the Sum Assured as maturity value. The policy is a unit linked life insurance policy not a fixed deposit or mutual fund. There is no assured return. Under this policy benefits payable depends upon market performance etc.  During the course of arguments counsel for Ops was unable to refer to the specific agreement clauses regarding the cancellations of the units on account of mortality charges. It was accepted by the counsel for ops that the table showing death benefit risk/mortality charges per month per Rs.1000 of Sum at Risk was not disclosed with the policy documents/ Schedule.

8.                Counsel for the complainant argued that no terms and conditions of the policy were supplied/explained by Ops, it was only stated that maturity value of the policy shall be Rs.5,00,000/-. No Clause for cancellation of units on account of monthly mortality charges was ever given with the policy terms and conditions and not even explained at the time of issuing policy. Rs.5,00,000/- as maturity value is to be paid by Ops and no deduction on account of cancellation of units be allowed.

9.                We are of the opinion that the District Forum while awarding payment of insured maturity amount of Rs.5,00,000/- has misunderstood the term Sum Assured. The Sum Assured is the risk cover to be paid in case of death of insured within the policy period . it is  not the maturity amount of the policy. We are also of the opinion that the complete terms and conditions were not supplied to the complainant along with the policy documents to show that cancellation of units per month in lieu of the mortality charges will be deducted from the allotted units to the insured. In view of the  judgment of the Hon’ble Supreme Court in case of “Modern Insulators versus Oriental Insurance Company Limited”dated 22/02/2000 wherein it was observed by Hon’ble Apex Court that “ as the terms and conditions of the standard policy wherein the exclusion clause was included were neither part of the contract of the insurance nor disclosed to the appleanant respondent cannot claim the benefit of the said exclusion clause.” In the above case no terms and conditions showing death benefit risk charges-per month per Rs. 1000/- of sum at risk was not part of the contract of the policy nor disclosed to the claimant. In case the terms and conditions have not been made to understand/ disclosed then those are not applicable.

                   The month wise units cancelled on account of morality charges are 2602 units for the period from 21.10.2005 to 21.10.2015 and the NAV of the one unit as on 21-10-2015 is Rs.52.50/-. So  (2602 x 52.50=136605) Rs.136606/- are payable to the complainant on account of cancellation of units as morality charges which was not part of the policy documents given to  the complainant. The Ops are also liable to pay the policy value which as on 30.06.2015 is Rs.63,783/-

10.              Sequel to the above, we partly accept the appeal and the order is modified. It is held that complainant is entitled to Rs.63,783/- as closing balance as on 30.06.2015 and Rs.1,36,605/- on account of cancellation of units as mortality charges. The total amount payable is Rs.2,00,388/- along with interest at the rate of 9% per annum from 21.10.2015 till realization and Ops are further directed to pay Rs.3000/- as litigation expenses to the complainant.

11.              The appellant had deposited an amount of Rs.25000/- with this Commission at the time of filing the appeal and another amount of Rs.50,000/-in compliance with the order dated 01.03.2017. These amounts with interest accrued thereon, if any, be remitted by the registry to the concerned District Forum, after the expiry of 90 days, from the dispatch of the certified copy of the order to the parties; subject to stay, if any, by the higher Fora/Court for release of the above amount and the District Forum may pass the appropriate order in this regard.   

12.              The appeal could not be decided within the statutory period due to heavy pendency of the Court cases.

13.              Copy of the order be communicated to the parties as per rules. 

 

                                                                     (Gurcharan Singh Saran)

                                                                   Presiding Judicial Member

 

 

                                                                  

September 26, 2017                               (Rajinder Kumar Goyal)

PK/-                                                                     Member