Delhi

West Delhi

CC/14/374

Lal Babu - Complainant(s)

Versus

HDFC Standard Life Insurance - Opp.Party(s)

17 Oct 2022

ORDER

DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION-III: WEST

GOVT. OF NCT OF DELHI

C-BLOCK, COMMUNITY CENTRE, PANKHA ROAD, JANAK PURI

NEW DELHI

 

Complaint Case No.374/2014

 

In the matter of:

 

	Lal Babu RZF-74, Nihal Vihar, Nangloi, Delhi- 110041                                                            ........Complainant
	Versus

HDFC Standard Life Insurance Co. Ltd.,

Branch Office, Community Centre

Near Soniya Cinema, Vikas Puri,

New Delhi-110018

 

Also at

Corporate Office, Trade Star, 2^nd floor,

A Wing, Junction of Kondivita and MV Road,

Andheri Kurla Road, Andheri(East),

Mumbai-400059

                                                                                                       ........Opposite Party

 

DATE OF INSTITUTION:         JUDGMENT RESERVED ON:           DATE OF DECISION:

17.06.2014 19.09.2022     17.10.2022

 

CORAM

Ms. Sonica Mehrotra, President

Ms.Richa Jindal, Member

Mr. Anil Kumar Koushal, Member

Present: Complainant in person.

ORDER

 

Per: Anil Kumar Koushal, Member

 

Factual matrix of the present case is as  under:

1. Complainant  states that he had taken a ‘HDFC Standard Life Policy(HDFC Unit Linked Young Star II) No.13276187 from the OP on 25.11.2009 for the assured sum of Rs.2,40,000/- for a term of 15 years.  The premium was to be paid half yearly @ Rs.6,000/-.  According to the complainant, since he could not continue with the policy, he had applied to OP for refund of policy amount as admissible on 16.04.2014.  As per Complainant, he  was assured by the OP that the refund amount shall be paid to him within ten days. However, he did not get the refund of the amount demanded from OP and was forced to send a reminder on 11.06.2014  upon which he was again assured that he will get his refund amount within four days. But no such admissible refund amount  has been received by the complainant till he was compelled to  file the present complaint whereby he is seeking the following prayer: 

 

1.To pay the refund amount by demand draft forthwith along with an interest of 12% per annum;

2. 2.To pay a sum of Rs.5,000/- for the harassment caused to the complainant;
3. 3.To pay Rs.1,000/- towards the legal and other misc. expenses.

2. Along with the complaint, the following documents have been filed by the complainant:

1.Copy of Policy issue letter dated 25.11.2009 issued by the OP in favour of complainant;

 

2.Customer acknowledgement slip dated 16.04.2014 issued by OP upon receipt of request for refund from the complainant;

 

3.Customer acknowledgement slip dated 11.06.2014 issued by the OP in favour of complainant upon receipt of reminder for refund of admissible policy amount.

 

3. Upon admission of the complaint on 03.07.2014, notice was issued to OP, who filed reply thereto.
4. In the reply filed by OP it submitted that the complainant has not approached this Commission with clean hands and hence not entitled to much relief as prayed in the complaint.  According to the OP it is an abuse of process of law as no cause of action has arisen to file the present complaint. OP took the preliminary objection that the present complaint is barred by limitation under the CP Act, 1086 as according to it, the subject policy was issued on 25.11.2009 and the  last premium  of the policy which was due on 24.11.2011 was not paid by the  complainant and accordingly the policy had lapsed and further the same was terminated as per terms and conditions of the policy.  Accordingly, the present complaint having been filed in July, 2014 is barred by limitation of not having been filed within two years of lapsation of the policy.  According to the OP, insurance is a subject matter of solicitation. The complainant was provided with all the details and information in respect of the policy under reference and after having understood the contents thereof had signed the proposal form and other documents. According to the OP, the following are the details of the policy issued to the complainant:

“Policy No.13276187

Plan: HDFC Unit Linked Young Star II

Risk commencement date: 24.11.2009

Premium & Freuency: Rs.6,000/- half yearly

Sum assured: Rs.2,40,000/-

Pay Term: 15 years

 

The policy documents were sent to the complainant through speed post on 27.11.2009 which were duly received by him on 27.11.2009.  Thereafter the complainant paid 3 renewal premiums but failed to pay the premium due on 24.11.2011 because of which the subject policy lapsed and thereafter got terminated as per the terms and conditions of the policy and upon termination, the admissible amount of Rs.6,522.25  payable was sent to the complainant at the address that was available  with the OP but was returned because of non-availability of the complainant at the said address.  Thereafter upon the complainant approaching the OP on 11.06.2014, the said amount of Rs.6522.25 was credited to the bank account of the complainant through NEFT on 18.06.2014. Therefore, now there is no grievance of the complainant left.  The OP  reproduced the surrender  procedure in the reply.  According to the OP the contractual relationship came to an end upon termination of the policy  and the complainant has already received the  amount due and payable to him.   Therefore, the present complaint is not maintainable.

5. OP filed with its reply only the authority letter  issued in favour of one Mr. Yogesh Kumar, Associate Manager-Legal to represent and pursue the case before this Commission.
6. The complainant filed rejoinder to the reply filed by the OP and refuted the averments of the OP in toto.  Complainant denied that the present complaint is time barred  as according to him, the policy  NO.13276187 with supporting documents  was surrender to the OP only on 16.04.2014 for refund of the amount paid as premium.  According to the complainant, OP itself admitted to have made payment of Rs.6522.25 against total deposit of Rs.24,000/- on 18.6.2014.  The present complaint was filed in June, 2014 and therefore, it is well within time.  Complainant submitted that the agents of OP entice the customers for opting Life policy without explaining details.  The customers are made to believe that such policies are just like savings investment with better interest/returns  and accordingly the customers are trapped in signing the proposal form.  This is not only deficiency but also unfair trade practice and in violation of  principles of good faith. It is stated by the complainant that he had paid Rs.24,000/- in half yearly instalments and therefore, entitled to the same amount as refund on surrender of the policy along with accrued interest.  Complainant alleges that four instalments of Rs.6000/-each have been collected by the OP from his account. The OP itself has stopped payment from his account without notice.  If the policy has lapsed, it is  only because  the OP stopped payment through ECH from complainant’s account.  According to him, he was assured full payment of the deposited amount but only an amount of Rs.6522.25 against Rs.24,000/- has been credited to his account and that too after filing of the present complaint.  
7.    Evidence by way of affidavit was filed by the complainant and he exhibited the documents placed on record.    OP also filed evidence by way of affidavit and exhibited the documents as Ex.OP/1 and OP/2.
8. Written  arguments were filed by the complainant as also by the OP.  On 19^th September, 2022, oral arguments of the complainant were heard.  Since the OP was unrepresented on that date, we proceed to decide the matter in terms of provisions of Section 38(2)(C) of the CP Act, 2019 based on the pleadings filed on record.
9. During oral arguments complainant reiterated the submissions made in the complaint and requested that OP may be directed to refund Rs.24,000/- deposited by him with it along with accrued interest in place of only Rs.6522.25 already credited to his account.
10. We have gone through the pleadings filed on record and the arguments advanced by the rival parties.
11. A preliminary objection has been raised by the OP that the complaint is barred by limitation in terms of Section 24A of the CP Act, 1986.  According to OP, the policy was taken on 25.11.2009 and the last premium on the policy due on 24.11.2011 was not paid  by the complainant and accordingly the policy had lapsed and further the same was terminated as per terms and conditions of the policy.  Accordingly,  the present complaint having been filed only in July, 2014  is hit by the law of limitation.  According to the complainant, he submitted his papers for surrender of policy only in June, 2014 and therefore, the present complaint is within time.
12. We do not find force in the  argument of the OP that the complaint is barred by limitation.   The complainant applied for surrender of the policy only  in June, 2014 and when  the OP did not pay the surrender value as admissible, he was forced to take recourse to the present complaint.  It is true that the policy as per terms and conditions thereof lapsed   on 24.11.2011 and the complainant did not apply for its revival  thereafter for reasons best known to him. At this stage we may refer to the relevant  provision (ii)(b) of the Schedule of Charges under the  policy opted by the complainant as under:

“(b) a policy automatically surrendered due to a lapse can be revived anytime during the period of two years from the date of lapse of the policy or till the end of 3 years from inception, whichever is later.”  

In this case, after lapsation of the policy on 24.11.2011, the complainant could seek revival of the same within two years thereof.  At the same time,  as per own admission of the OP,  the policy lapsed when the complainant did not pay the due instalment on 24.11.2011 and thereafter the same was terminated.  Had that been so, the complainant was never notified about this and the amount admissible under the Policy should have been paid back to the complainant by the OP in terms of provision (ii) (C) of the Schedule of Charges, which is quoted below:

            “If a policy automatically surrendered due to a lapse is  not revived, the Unit fund value at the date of lapse  less the surrender charge as specified in the Schedule of Charges  would be paid to the policy holder at the end of 2 years from the date of lapse or at the end of 3 years from inception  whichever is later.”

 But the above provision was not followed by the OP and  it kept on waiting till the complainant filed papers for surrender of the policy in June, 2014. No document of termination of the policy  in question has been filed on record by the OP. Probably the OP was also waiting for revival of the policy by the complainant as per terms and conditions.  Based on this conclusion arrived at by us, the argument of the OP that the complaint is barred by limitation is bereft of any merit.

13. As regards the claim of complainant that  he has been paid less as against the admissible amount, based on the amount deposited by him in instalments, we may note that the decision to surrender the policy  was of the complainant himself as  he was not able to continue the policy.  Had he continued with the policy till the end, he would have received the due amount as  promised by the  OP in the policy.  In this regard OP stated that the insurance is a subject matter of solicitation.  The complainant was provided with all the details and adequate information in respect of the policy under reference.  The OP in this regard relied upon the decision rendered by the Hon’ble SCDRC, Delhi on almost similar issue in the case of  Managing Director, Max Life Insurance Co. Ltd. Vs. Chand Kishore Nanda(First Appeal No.902/2014, decided on 27.01.2017).  In the above referred case, reliance was placed on the decision of the Hon’ble Supreme Court in the case of  United India Insurance Co. Ltd, vs. Harchand Rai Chandan Lal, 2004(6) ALD 112 SC wherein following was held:

           “The terms and conditions  of a contract have to be strictly read and natural meaning be given  to it. No outside aid should be sought unless the meaning is ambiguous”.

Further reliance was placed  on the decision of the Apex Court in the matter of Suraj Mal Ram Niwas Oil Mills(P) Ltd Vs United India Insurance Co. Ltd and Anr, SC 0814 2010 wherein the following observations were made:

            “There must be strict compliance with the terms and conditions of an insurance policy and the appellant having breached a fundamental condition of the policy, the respondent is not liable to pay any amount  to them.  In support  of the contention that in a contract of insurance, rights and obligations are strictly governed by the term of the policy and no exception or relaxation can be given on the ground of equity.”

14. Based on the aforesaid law laid down by the Hon’ble Supreme Court and other legal authorities following it, we conclude that  the OP was legitimate and justified  in making payment of Rs.6522.25 as per the terms and conditions of the policy.
15.  As regards the contention of the complainant that the OP was deficient in not making payment of the admissible amount to him once he had submitted the papers for surrender of the policy, we note that the claim for refund of the policy amount was submitted on 16.04.2014 and since the amount under the policy was not refunded, the complainant sent a reminder to OP on 11.06.2014 but still the admissible amount was not paid. It was only after filing of the complaint on 17.06.2014 that the OP finally as per their own admission paid the amount of Rs.6522.25 to the complainant.  Though the OP submitted in its reply that  upon submission of surrender papers by the complainant,  it had sent the cheque for the surrender amount to the complainant at his previous  address but he was not found at the given address and ultimately the said amount was credited to the account of the complainant on   18.06.2014 when the complainant approached it. The OP has not filed on record any documentary evidence to show that the refund amount was sent at the previous address of the complainant.  We find force in the argument of the complainant that the OP was deficient in refunding the surrender value of the policy to the complainant in time.  On this ground we draw support from the afore quoted  provison (ii)(C) of the schedule of charges attached with the terms and conditions of the policy.  Clearly as per the said provision, the OP when the policy had lapsed  upon non-payment of the instalment due on 24.11.2011 and was terminated, the OP should have automatically  paid back the surrender value of the policy to the complainant. Further, the payment was processed only when the complainant approached  the OP on 16.4.2014  to seek surrender value of the policy. Still the OP took 2 months time to release the amount due as per the terms and conditions of the policy.  This clearly amounted to deficiency in service.   
16. Accordingly, the complaint is partly allowed and the OP is held guilty of deficiency in service and directed to pay a sum of Rs.7500/- to the complainant as compensation for the harassment and mental agony faced by him.  Let this order be complied with within 30 days of receipt of copy of this order.  File be consigned to record room.  

             A copy of this order shall be supplied to parties to the dispute free of cost  under Regulation 21 of CPR, 2020 on a written requisition/application being made by them in the name of  President of this Commission.

(Sonica M

RICHA JINAL                     ANIL KOUSHAL                     SONICA MEHROTRA

MEMBER                               MEMBER                                PRESIDENT