1. Aggrieved by the Order dated 23.02.2017 of the State Consumer Disputes Redressal Commission, Jaipur, Rajasthan (for short, the State Commission), M/S TATA AIA Life Insurance Co. Ltd., Petitioner/ Insurance Company filed this Revision Petition No. 2719 of 2017 under Section 21(b) of the Consumer Protection Act, 1986 (for short, the Act) against Smt. Gindo Devi, Complainant/ Respondent with prayer to set aside the Order of the State Commission, which had set aside the Order of the District Consumer Disputes Redressal Forum, Jhunjhunu, Rajasthan (for short, the District Forum) dated 04.10.2012. The Complaint filed by the Complainant being Consumer Complaint No. 270 of 2012 before the District Forum was dismissed.
2. The Appeal filed by the Respondent was allowed and the Order of the District Forum was set aside. The relevant portion of the Order reads as under:

“From all the above description it is clear the Insurance Company have committed discrepancy in service under the Rule 4(6) of the Insurance Regulatory and Development Authority (Protection of Policy Holders’ Interest) Regulations, 2002 by not allowing/disallowing the proposal within the prescribed period. In our opinion complaint of the Complainant is liable to be allowed. Complainant’s husband have got Insurance Policy of the insurance amount to Rs. 2,00,000/-, out of which payment of Rs. 20,000/- has been paid to the Complainant. Therefore, we considered fit and proper to be granted remaining balance amount to Rs. 1,80,000/- from the date of filing of Complaint till the final payment with 9% p.a. interest and Rs. 10,000/- towards the litigation expenses as she has submitted complaints two times before the District Consumer Forum and now she compelled to submit an appeal before the State Commission.

Resultantly, allowing appeal of complainant the order dated 04.10.2012 passed in the Complaint No. 270/2012 by District Forum Jhunjhunu is being dismissed. Allowing complaint of the Complainant, Opposite Insurance Company is being ordered they will pay to the Complainant the remaining balance amount to Rs. 1,80,000/- from the date of filing of Complaint till the final payment with the 09% p.a. interest. Beside this they will also pay Rs. 10,000/- towards the litigation expenses.”

3. As the State Commission and District Forum have comprehensively addressed the facts of the case, I find it unnecessary to reiterate the same.
4. Heard learned Counsel for both the Parties and perused the material available on record.
5. Learned Counsel for the Petitioner argued that the Deceased Life Assured (for short, DLA) i.e. Suraj Bhan on 24.11.2008 filed and deposited the Application Form and paid a premium of Rs.20,000/-  for purchasing a Life Insurance Policy for a total sum assured of Rs.2,00,000/- under “Invest Assure Flexi”. The DLA was suffering from paraplegic/paralysis. The Petitioner arranged the medical test for the DLA. The DLA appeared before the Medical Board on 07.01.2009 and thereafter on 27.01.2009, the Petitioner received the medical report of the DLA.  Ld. Counsel argued that on 31.01.2009 the Petitioner informed the DLA about the modified Policy. But, the DLA had died on 23.01.2009. The Petitioner had refunded the premium amount of Rs.20,000/- to the Respondent.
6. Ld. Counsel for the Respondent argued that the premium deposit receipt issued by the Petitioner mentions that if the policy was issued with the premium payment, it would be automatically considered deposited under the policy. The Assured did not conceal any health conditions in the Proposal Form. If the Insurance Company needed to gather information about the Assured’s health or any other details, this should have been done within 15 days of receiving the Proposal Form. Under Rule 4 (6) of the Insurance Regulatory and Development Authority (Protection of Policy Holders’ Interest) Regulations, 2002, the Complainant should have been informed about the acceptance or cancellation of the Proposal, which did not happen. The Insurance Company only claimed that the Proposal was not accepted and no policy was issued and it returned the premium amount of Rs.20,000/- after the Assured’s death.
7. Have gone through the Orders of the State Commission and the District Forum. The issue at hand is whether the Insurance Company was justified in rejecting the claim of the complainant on the ground that no Policy was executed.
8. It is an undisputed fact that the DLA duly filled the application form and submitted the premium of Rs.20,000/- on 24.11.2008 and a medical examination was conducted on 07.01.2009. The DLA passed away on 23.01.2009 but the Petitioner sent a letter dated 31.01.2009 to the address of the DLA after his death about the modified Policy raising the premium amount.  The Assured had declared his health status as suffering from paralysis.  So there is no issue of non-disclosure.  The premium was collected accordingly.  No new health status has been argued, which warranted the delay in either accepting or rejecting the Proposal Form or delaying acceptance with a modified premium amount.   
9. The argument being raised by the Insurance Company is that it had not issued the Policy.  But, the Insurance Company failed to issue the Policy or communicate any decision regarding the proposal submitted on 24.11.2008, in violation of Rule 4 (6) of the Insurance Regulatory and Development Authority (Protection of Policy Holders’ Interest) Regulations, 2002. The Petitioner’s failure to notify the Complainant of the Proposal’s acceptance or rejection within the required 15 days period constitutes a breach of regulatory obligation. The rejection of the claim after the Assured’s death, based on the non-issuance of the policy, appears to be an attempt to evade liability. The Insurance Company definitely committed deficiency of service under the Act by rejecting the claim of the Complainant.  The State Commission in its Order has dealt with the subject in detail and suffers from no illegality, material irregularity or jurisdictional error.
10. I am also relying on the Order of this Commission in Naresh Madan & Anr. Vs. Managing Director, Bharti Axa Life Insurance Co. Ltd, RP/1790/2017, decided on 03.07.2024, wherein the issue of delay in acceptance or rejection of Proposal Form has been discussed and the applicability of IRDA Regulation in deciding the same affirmed.
11. In view of the aforesaid discussion, the present Revision Petition is dismissed. The Order of the State Commission is partly upheld with only a modification to the extent that the cost of litigation shall be Rs.1,00,000/- to be paid to the Respondent.

12. Pending applications, if any, stand disposed of.