ORDER

Naveen Puri, President.                            

          The complainant Smt. Shub Lata (Wd/o Sh. Ranjit Singh) has filed the present complaint against the titled opposite parties (for short, the OP1/OP2/OP3/OP4 and OP5) being hurt at their acts of commissions and omissions that have allegedly infringed her statutory consumer rights. She proceeds to explain that the OP5 Bank had advanced Rs.16.20 Lac to her late husband Sh. Ranjit Singh as Housing Loan against equitable mortgage of the financed house and in order to additionally secure the advanced loan had got him insured from the OP3 insurer whereas the complainant had been the legal nominee in both the Housing Loan Agreement and the related Home Credit Assure Policy.

2.       The complainant further states that on 24.03.2021 her husband Ranjit Singh had died of critical illnesses namely Renal Failure & Acute Kidney Injury. The OP3 Bank's Housing Loan of Rs.16.20 Lac as sanctioned in December' 2019  was to be repaid through Equated Monthly Installments (EMI) in Five Years till the end of the year 2024 whereas the Home Credit-Assure Policy purchased @ a premium (cost) of Rs.1,00,656/- was to keep the Loan outstanding-balance secured up to the year 2024. The Borrower Ranjit Singh during his life time had been regular in repayment of his Loan EMIs and the same were repayable by the insurer in case of any eventuality causing death to him through personal accident, critical illness etc or losses incurring to the House its Furniture/Fixtures and Furnishings etc on account of fire, theft, burglary, loss of job and allied perils etc.      

3.       Thus, at the demise of the insured Ranjit Singh and in terms of the insurance clause of the opposite parties were duly intimated and requested to set-off the balance o/s loan amounts against the death claim(s). But the OP insurers kept the resolve deferred on one count or the other and in the meantime the OP4 & OP5 bankers did engage recovery agents/ bad elements (Gundas) to force-ably/illegally recover the home-loan installments from the widowed complainant whose valuable right (of women) to graceful living was also got infringed, in this way. The complainant told the OP5 bank to recover the balance outstanding in the deceased's loan account from the OP3 insurers as they themselves had arranged the so-called Home Credit Assure Policy from their sister-concern/associates in banking/insurance business. At this and in rebuttal, the OP3 insurers rejected/denied the claim vide their letter dated 10.06.2021. The complainant approached the OP with request to review their resolve and also to check their unauthorized acts cum omissions and also got served one legal-notice upon them but to no avail hence the present complaint praying/seeking liquidation of loan account balance outstanding with the OP Bank by the OP insurers besides to pay her Rs.1,00,000/- as compensation and Rs.50,000/- as cost of the present litigation, in the interest of justice. The complainant Smt. Shubh Lata has filed the following evidence/documents to prove her version of the complaint:

                        i)       Ex.CW1/A - Self Declaration (Affidavit) deposing the contents of the complaint;

                        ii)      Ex.C1 – Copy of the loan agreement;

                        iii)     Ex.C2 – Copy of the death certificate of the insured;

                        iv)     Ex.C3 – Copy of complainant's Aadhar Card ID;

                        v)      Ex.C4 – Copy of Certificate of Insurance cum Receipt (27.12.2019);

                        vi)     Ex.C5 – Copy of the Repudiation Letter dated 10.06.2021;

                        vii)    Ex.C6 to Ex.C8 – Reminders for repayment by the OP5 Bank;

                        viii)   Ex.C9 – Copy of the Claim-form;

                         ix)    Ex.C10 & Ex.C11 – Copy of medical treatment and bills etc.;

                          x)    Ex.C12 & Ex.C13 – Legal Notice to the OP insurers/bank with postal Receipts;

4.       The titled opposite party insurers (OP1,OP2 & OP3), in response to the commission’s summons appeared through their counsel and filed their written reply stating therein preliminary objections as:

          The complaint has not been filed by a competent person as it should have been filed by all the legal heirs of the deceased Ranjit Singh. The claim was repudiated on the ground of non-coverage of the 'cause of 'death' under the major medical illnesses under the policy conditions. The insured died on 24.03.2021 on account of chronic liver disease, acute on chronic Liver-failure, Acute Kidney Injury, Hepatorenal Syndrome, Hepatic Encephalitic and Septic shock etc., as has been certified in LAMA summary of the PGIMER and all these ailments are not covered under section-3 of the terms and conditions of the related policy. The liability of the insurer is limited to the insured perils only occurring within the policy period subject to terms and exceptions of the policy and as approved by the IRDAI.

5.       Further, the OP insurers have reproduced the clinical features of Acute Kidney Injury and Chronic Kidney Disease differentiating the two qua the advanced medical science research in their endeavor to justify that 'Acute Kidney Injury' from which the insured suffered was not covered under the policy and hence the claim has been rightly repudiated. Here, the OP insurers have also quoted some senior court judgments that stand respectfully read by us and the legal principles highlighted therein shall be our guiding lighthouse during the present exercise in adjudication

/consideration.              

6.       Again, on merits, the OP insurers in their written statement have either denied or shrugged the contents of the complaint addressing these as matters of records etc.; but the main contention of the OP 1 to 3 throughout have been that the deceased Ranjit Singh has succumbed to 'ailments' that were not covered under the related Credit Assure Policy. Finally, the OP1/2/3 have sought dismissal of the complaint being bereft of merit and also for want of cause of action, in the interest of justice, equity and fair play.

The OP insurers in support of their version and pleadings in defense have produced the following evidentiary documents:

          i)       Ex.OPw1,2,3/1 Self declaration by the Legal Manager Shweta Pokhriyal;

          ii)      Ex.OP1,2,3/2 Power of Attorney favoring the Manager Legal (claims);

          iii)     Ex.OP1,2,3/3 Premium Receipt of the Home Credit Assure Policy;

          iv)     Ex.OP1,2,3/4 Policy Wording;

          v)      Ex.OP1,2,3/5 Claim Form;

          vi)     Ex.OP1,2,3/6 OPD Card PGI;

          vii)    Ex.OP1,2,3/7 Repudiation Letter.

          viii)   Written Arguments – by the OP1,2,3 insurers.

7.       The OP4 Bank H.O. did not appear in spite of service of summons/notice and were thus ordered to suffer ex-part-e proceedings whereas the OP5 Bank Branch upon notice/summons appeared through its counsel and filed its written reply stating therein its preliminary objections as hereunder:

8.       To start with the OP5 Co., the answering party has clarified that its title has been: HDFC Ltd., and not the HDFC Bank Pvt. Ltd., as the two have been the two separate legal entities and further admit having advanced housing loan to the deceased husband Ranjit Singh of the present complainant. The Honorable commission has no territorial jurisdiction over the answering party as it is based at Chandigarh only with no office at Gurdaspur and the present complaint deserves dismissal on the grounds of mis-joinder of the parties. Also there's no privity of contract between the OP1,2,3 insurers and the answering OP5 Co., who have only/merely financed the 'insurance-premium' of Rs.1,00,657/- at the request of its the then borrower Ranjit Singh, since deceased; And as such there has been neither any deficiency in service on its part nor any cause of action favoring the complainant to enjoin it as an opposite party to the present complaint. The complainant has committed offense of 'misrepresentation' in her complaint as the outstanding amounts in the loan accounts have turned 'payable' by the legal-heirs of the deceased borrower (including the present complainant) once the insurance-claim stood repudiated by the OP1,2,3 insurers. Further, on merits, the OP5 in its written statement have either denied or shrugged the contents of the complaint addressing these as record matters etc.; However, the OP5 has restated that the complainant has no cause of action against it and has been liable (along with other legal-heirs of deceased) to repay the amounts outstanding in the loan accounts.

9.       The OP5 Co. (the financiers) have placed forth following documents/ evidence in support of its prosecution of defense.

i)       Ex.OP5w5/A – Affidavit of Sh Aditya Kochar Dy. Manger with OP5 Co.;

ii)      Ex.OP5/1 – Copy of the Home Equity Loan Agreement;

iii)     Ex.OP5/2 – Copy of Loan A/c Statements;

iv)     Ex.OP5/3 – Summary of balance outstanding in the loan accounts.

Pleadings & Arguments: (The OP Insurers’ Side): The OP insurers' prime defense favoring its repudiation has been that the insured has not succumbed to an insured ailment.

10.     We have examined the available documents/evidence on the records so as to statutorily interpret the meaning and purpose of each document and also the scope of adverse inference on account of some documents ignored to be produced by the contesting litigants against the back-drop of the arguments as put forth by the learned counsels for their respective litigants. We find that the present dispute has arisen on account of the impugned ‘repudiation’ of insurance claim pertaining to the Home Credit Assure Policy in question, by the OP1,2,3 insurers, as filed by the present complainant pertaining to the ‘insurance-cover’ purchased by the OP5 financiers on behalf of her late (demised) husband Ranjeet Singh, to cover the Housing Loan outstanding in case of an eventuality. The complainant has been legal heir of deceased insured.

11.     We observe that the one and the only prime eventful aspersion founding/supporting the repudiation of the impugned 'claim' in question has been that the insured died of/succumbed to an ailment that was not covered under the list of ailments covered by/ listed amongst the covered list of ailments. We see that the OP insurers in the written reply (on the strength of LAMA Summary of PGIMER) have stated that the insured Ranjit Singh had expired on 24.03.2021 due to Acute Kidney Injury (one amongst the others) and  the same was not covered under the Major Medical Ailments (Illnesses) under Section-3 of the related Policy's terms and conditions. The OP insurers have also stated that 'what' is covered is: 'Chronic Kidney Disease' and not the 'Acute Kidney Injury' and have further, in order to distinguish the two, have produced fine but academic/medical/technical features (and that too 'clinical', only) but somehow they have not produced any cogent evidence

/distinction that bars acute kidney injury to fall under the family of chronic kidney disease.  To a layman, the apparent effect of acute kidney injury may be 'sudden' but its origin lays deep may be since many past days/months/years etc. The OP insurers have not brought in any proof pin-pointing the cause of death as the 'kidney-injury' as it has been simply one of the ailments qua PGIMER LAMA summary simply mentioning of the ailments suffered by the deceased patient. There's been no distinctions on the herein records in kidney-illness. 

12.     Somehow, we do not concur with the logic of the herein impugned repudiation and are inclined to examine the validity & legality of the impugned repudiation (of the related insurance claim) in the back-drop of the preceding and also the succeeding acts & events in the light of the facts on records and current law on home credit assure insurance vis-à-vis consumer proposition’s subject matter, in issue. We observe that the clinical features differentiating the two so-distinguished ailments do basically and broadly pertain to the one and the same category of kidney-disease. The differing clinical features as enumerated herein by the OP insurers may be of medical/academic interest but shall certainly have no legal impact to the claim-resolve. The herein enumerated features are not supported by any reference to medical-literature nor by an expert opinion/deposition and thus shall not be admissible either in the claim-resolve or in the statutory adjudication.         

13.     We find that the OP insurers here have arbitrarily rejected the impugned claim merely in their endeavor to somehow repudiate the same. To remove all ambiguity, it may be clarified here that an ‘insurance claim’ and for that matter any ‘issue’ can be neither legally ‘favored’ nor legally ‘ousted’ on mere ‘conjectures and presumptions’ how strong these might appear to be. The OP insurers must realize that their administrative decisions in settling insurance claims are open to judicial review and thus need be taken with due application of mind and not arbitrarily and these should also be speaking in nature duly explaining the reason and logic of the decision as to how the same has been reached. The facts in issue need be appreciated while awarding sanctity to the current applicable law. Finally, in the matter pertaining to the present complaint and in the light of the all above, we set aside the OP insurers' impugned repudiation of the Home Assure Loan claim being arbitrary (contra to laws of natural justice) and amounting to ‘deficiency in service'. Further, we find that the OP5 Financiers to be in full connivance with the OP insurers and have jointly infringed the consumer rights of the complainant. Thus, we restrict the OP5 by order not to reach/draw demand bills etc forthwith upon the complainant and instead a final demand bill aggregating all the loan accounts will be drawn upon the OP insurers and who are hereby ordered to pay the same out of the claim proceeds and pay the balance amount, if any, to the complainant. Both the OP finance-rs and the insurers shall ensure that no penal-interest or other charges are debited in all the loan accounts since inception and all the deposited EMI stand duly accounted for. The OP insurers as well as the OP financiers shall pay compliance to these ORDERS within 45 days of the receipt of the certified copy of these orders besides to pay a lump sum amount of Rs.10,000/- to the complainant as compensation and Rs.5,000/- as cost of the present litigation otherwise the awarded amount shall attract interest @ 9 % PA from the date of the complaint till actually paid.

14.     Copy of the order be communicated to the parties free of charges. After compliance, file be consigned to record.

                                                           (Naveen Puri)  

                                                                 President.

ANNOUNCED:                           (R.S.Sukhija)

JULY 15, 2022.                                    Member.

YP.