Chandigarh

DF-II

CC/488/2014

Smt Sudha Rani Sharma - Complainant(s)

Versus

HDFC Standard Life - Opp.Party(s)

Raman Sharma & Charu Sharma, Adv.

06 Oct 2015

ORDER

DISTRICT CONSUMER DISPUTES REDRESSAL FORUM-II, U.T. CHANDIGARH

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Consumer Complaint  No	:	488 OF 2014
Date  of  Institution	:	17.9.2014
Date   of   Decision	:	06.10.2015

 

 

 

 

 

Smt.Sudha Rani Sharma w/o Sh.Santosh Kumar Sharma, r/o 81, Woolen Scote Circle, Etobicoke, Ontario – M9V4R6 Canada (Presently at H.No.1306, Golden Enclave, Lohgarh, Zirakpur, Distt. SAS Nagar, Mohali)

 

             …..Complainant

Versus

 

HDFC Standard Life, 1^st and 2^nd Floor, SCO No.1A-120, Sector 43-B, Chandigarh

….. Opposite Party

 

BEFORE:  SH.RAJAN DEWAN                 PRESIDENT

         SH.JASWINDER SINGH SIDHU       MEMBER

         MRS.PRITI MALHOTRA             MEMBER

 

 

For complainant(s)      :     Sh.Raman Sharma, Advocate          

 

For Opposite Party(s)   :     Sh.Nitin Thatai, Advocate

 

 

PER JASWINDER SINGH SIDHU, MEMBER

 

 

          As none appeared on behalf of the complainant on the day of arguments i.e. 22.09.2015, we therefore, proceeded to dispose of this complaint on merits under Rule 4(8) of the Chandigarh Consumer Protection Rules, 1987, read with Section 13(2) of the Consumer Protection Act, 1986 (as amended upto date) even in the absence of the complainant.

 

2]        As per the case, the complainant, who is an NRI, during her visit in India in March, 2010, believing the official of the Opposite Party, made one time investment/deposit of Rs.3.00 lacs by making payment through cheque from NRO Account of her husband and also signed on certain blank Performas.  It is averred that the complainant alongwith her husband had left for Canada on 13.4.2010 and was available at her local address upto 12.4.2010, but she did not receive any receipt or documents from the Opposite Party.  It is also averred that the complainant was surprised to receive a telephonic call from the Opposite Party for payment of installment of insurance policy in March, 2011. Thereafter, the complainant on her visited to India, in Nov., 2011, visited the Opposite Party and explained the position that neither she had received any policy document nor was she interested in any such policy.  After that, the complainant received a registered envelope dispatched on 1.12.2011 containing the policy document (Ann.C-1 colly.).  After going through the policy, the complainant exercised the option to withdraw from the policy by letter dated 14.12.2011 (Ann.C-2), which was declined being beyond 15 days period vide Ann.C-3. An another request made by the complainant was also declined on the same ground by the Opposite Party vide letter dated 26.8.2013 (Ann.C-4).  It is pleaded that firstly the complainant has been misquoted and her amount was invested in the said policy by taking benefit of her absence from the country and subsequently, when she exercised option to withdraw from the policy within 15 days stipulated free look period from the date of delivery of the policy documents to her, the same has been rejected by stating that the option has not been exercised within 15 days.  Hence, this complaint has been filed alleging the said act of the Opposite Party as gross deficiency in service.

 

3]       Opposite Party in its reply, while admitting the factual matrix of the case, has maintained that the Complainant had submitted a proposal dated 26.3.2010 (Ex.R-2), for the purchase of HDFC Saving Assurance Plan; the proposal was accepted, on the standard rates, based on the information provided and consequently, a policy was issued bearing No.13583316 dated 28.3.2010.  It is also asserted that before acceptance of the proposal by the Opposite Party, the contents of the proposal/application, illustration and the addendum forms were read and explained to the LA in English language i.e. the language best known to her. It is further asserted that the policy was issued on 28.3.2010, which might have been received by the complainant/LA within a week’s time or so, whereas the cancellation request of the policy was made on 14.11.2011 for the first time, which was later on denied by the answering Opposite Party vide letter dated 22.11.2011  (Ex.R-6 & R-7).  It is pleaded that since the request was not received by the Opposite Party within free look period of 15 days, therefore, it was rightly denied. It is further pleaded that the complaint is barred by limitation. Denying all other allegations, Opposite Parties have prayed for dismissal of the complaint.

 

4]       The Complainant also filed rejoinder thereby reiterating the averments as made in complaint and controverting that of the Opposite Party made in the reply.

 

5]       Parties led evidence in support of their contentions.

 

6]       We have heard the ld. Counsel for Opposite Party and have also perused the record as well as written arguments.

 

7]       The complainant, who had maintained an NRO account with her bank (HDFC Bank) and claims to have been wrongly advised by the agents of the Opposite Parties in subscribing for the policy issued by them on the basis of the proposal form, which was got signed on the assurance of giving her better returns than keeping her money with the bank.  A total of single premium amounting to Rs.3.00 lacs was paid against which the policy in question was issued to the complainant on the basis of proposal form, which was got signed from her.  Immediately after subscribing for the policy, the complainant left for Canada as she was an NRI and visited India occasionally. The complainant also claims to be a Housewife without any regular source of income and has cited that she cannot continuously pay a premium of Rs.3.00 lacs for 10 years term of the policy.  The complainant has further claimed that she did not receive the policy on the first instance and got the same on her return to India in the year 2011 after her personal visit to the office of Opposite Party.  Furthermore, she on receiving this policy document, returned the same within 15 days period of its receipt and claims that her free-look request should have been honoured by the Opposite Party but it preferred to ignore the same. Thus claiming deficiency in service on the part of Opposite Party, has sought the refund of the premium paid to it along with compensation and cost of litigation.

 

            

 

8]       The Opposite Party while denying any deficiency in service on its part, has claimed that the policy in question was duly issued on the basis of proposal form and also the documents received along with it and as a complainant herself failed to mention her alternative address where she could have received the policy documents issued in her name.  The Opposite Party has also claimed that there is no ground for cancellation of the policy as the request for such cancellation was received much later from the date of issuance of the policy and also the delivery of the policy document at the complainant address so mentioned in the proposal form.  Thus claiming no deficiency in service in service on its part, the Opposite Party has prayed for dismissal of the complaint.

 

9]       We have minutely perused the documents placed on record by the parties and are of the considered opinion that as the complainant has alleged mis-selling of the policy and also that the same was in variance of the features, which were promised by the agent of the Opposite Party, the same was not acceptable to her in its present form.

 

10]      The Opposite Party while filing their reply/version has claimed that the policy in question was issued on the basis of processing of the proposal form and also the documents received along with it, therefore, it is necessary to visit these documents so as to assess the genuineness of the claim of the Opposite Party about the issuance of the policy as per IRDA guidelines, which are mandatory upon it.  

 

11]      First and foremost, the premium amount so received by the Opposite Party was in excess of Rs.50,000/- and as such, the Opposite Party was duty bound to follow the KYC as well as Anti Money Laundering Norms, applicable to such policies.  However, the documents necessary for the identity of the proposer and the proof of his/her residence, are found missing and the relevant columns of Ex.R-4 mention the same to be as “Bank Verification Letter”, if so applicable, is still not placed on record by the Opposite Party. 

        

12]      The declaration which was got signed by the complainant, found appended on Page-11 of the reply clearly mentions that “The first premium has been paid out of legally declared and assessed sources of income and the subsequent premiums, if any, will continue to be paid out of legally declared and assessed sources of income.” , which is clearly indicative that the Opposite Party was duty bound to receive such documents from the complainant from where, it could be established that the complainant’s income was legally declared and assessed.  However, when the complainant on the same (Page No.11 of reply) having mentioned her status as Housewife residing in Canada, it was incumbent upon the Opposite Party to demand such documents from where it could be adduced that she was capable of paying her premium of Rs.3.00 lacs per year and also that she would continue to pay the same for the 10 years term of the policy.  The Opposite Party failed to take on record any such document, therefore, it had acted against the IRDA guidelines and ignoring the same to its advantage. This act of the Opposite Party amounts to mis-selling of the policy and also an unfair trade practice indicative of its intention of collecting the premium, putting to wind all applicable statutes, which is amounts to deficiency in service on its part. 

 

13]      The Opposite Party has placed on record a few judgments, but after having gone through these, we with utmost humbleness prefer to ignore the same as the case of the complainant is totally different from the findings so found mentioned in these judgment, for the reason that these judgments do not categorically mentions that the Opposite Party is free to ignore the mandated IRDA guidelines while issuing its policies.

 

14]      In the light of these findings, the present policy issued by the Opposite Party is void ab-initio and the complainant is entitled to the refund of the premium paid by her and she is also entitled to an interest on her money for the period the same remained and utilized by the Opposite Party. 

 

15]      In the light of above observations, we are of the concerted view that the Opposite party is found deficient in rendering proper service to the complainant as well as indulged into unfair trade practice. Hence, the present complaint of the Complainant is allowed qua Opposite Party. The Opposite party is directed as under:-

 

[a] To refund Rs.3.00 lacs being the premium paid by the complainant along with interest @9% from the date of payment till it is paid.

 

[b] To pay an amount of Rs.20,000/- to the complainant as consolidated amount of compensation for causing mental agony and harassment on account of deficiency in service and unfair trade practice.

[c] To pay litigation expenses to the tune of Rs.10,000/-

 

         The above said order shall be complied within 45 days of its receipt by the Opposite Party; thereafter, it shall be liable to pay the premium amount of Rs.3.00 lacs along with an interest @18% per annum from the date of payment till it is paid and also the same interest on the compensation amount of Rs.20,000/- from the date of filing of the complaint till it is paid, apart from paying litigation expenses.

 

         The certified copy of this order be sent to the parties free of charge, after which the file be consigned.

Announced

6^th October, 2015

                                                                                                Sd/-

 (RAJAN DEWAN)

PRESIDENT

 

Sd/-

 (JASWINDER SINGH SIDHU)

MEMBER

 

 

Sd/-

(PRITI MALHOTRA)

MEMBER

Om                                                                                                                       

 

 

DISTRICT FORUM – II

CONSUMER COMPLAINT NO.488 OF 2014

PRESENT:   None   Dated the 6th day of October, 2015

O R D E R                        Vide our detailed order of even date, recorded separately, the complaint has been allowed against the Opposite Parties.                    After compliance, file be consigned to record room.

 

(Priti Malhotra)	(Rajan Dewan)	(Jaswinder Singh Sidhu)
Member	President	Member