DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION (EAST)

GOVT. OF NCT OF DELHI

CONVENIENT SHOPPING CENTRE, FIRST FLOOR,

SAINI ENCLAVE, DELHI – 110 092

C.C. No. 451/2014

Date of Institution: 13.05.2014

Judgment Reserved on: 19.09.2022

Judgment Passed on: 23.09.2022

CORUM:

Sh. S.S. Malhotra (President)

Ms. Ritu Garodia (Member)

Sh. Ravi Kumar (Member)

Order By: Ms. Ritu Garodia (Member)

JUDGEMENT

1. The Complaint pertains to deficiency in service on part of OPs Bank in not paying premium timely and on the part of OP2-4 who are in joint venture with OP1 and OP2 in repudiating the claim. 
2. Brief facts as mentioned in the complaint are that the Complainant purchased an IOB Health Care Plus Policy from OP2 through OP1.  It is further stated that there was a joint venture between OP1 and OP2 which covered various benefits such as insuring the Complainant against various diseases and illness or any bodily injury through accident.
3. The premium of the Policy was to be deducted from the saving account of the Complainant as was being maintained with OP1. The annual premium of the Policy in the year 2009 was Rs.1868/- and Rs.3,030/- in 2011 and the same was being deducted from the saving account of the Complainant since 2009.  It is submitted that the premium for the Policy was being regularly debited by OP1 and transferred to OP2. The fourth year Policy covered the period from 12.1.2013 to 11.1.2014, and the premium amount in the fifth year should have been debited from the saving account by OP1 and transferred to OP2. The amount should have been debited before due date.
4. It is submitted that as per the terms and conditions, at the time of taking the policy, OP1 had to debit automatically the premium amount from the Complainant’s saving bank account i.e. through auto debit and no special instructions were required to be given to OP1 every year and this practice was even being followed by OP.
5. The Complainant fell ill and was admitted on 18.1.2014 in Sir Ganga Ram Hospital for treatment of interstitial lung disease, and hiatus hernia. A cashless claim was filed with TPA, OP4, which was rejected The Complainant made the payment of Rs. 46,000/- in the hospital and was discharged on 21.1.2014. The Complainant then lodged the claim before the insurance company and he received a reply dated 03.04.2014 from OP3, stating that the policy had lapsed due to late payment.   The Complainant contacted OP1 to know the reason for not debiting the premium.  OP1 advised the Complainant to submit the claim form along with original bills amounting to Rs.50,742/- but the insurance company refused to reimburse the medical bills of the Complainant. 
6. It is alleged that OP1 was negligent in not debiting the saving account and transferring the premium amount to OP2, and OP4 was negligent in not giving any timely reply to the cashless claim.  The Complainant prays for the reimbursement of the medical bills of Rs.50,742/- along with interest @ 18% p.a  from all OPs and compensation and litigation charges amounting to Rs. 5,000/- and 5,500/- respectively. 
7. OP1 in his reply has stated that there is no deficiency on the part of OP1. As per the Health Insurance proposal, the Complainant fully understood that OP1 has no responsibility for any claims filed and the same has to be pursued with OP2 and OP3 through Third Party administrator. However, it has not denied the insurance product was a joint-venture between the bank and insurance company.
8. It is specifically denied that the premium of the policy was deducted from the saving account of the Complainant through auto debit.  OP1 has explained that auto debit is used when a customer of the bank had to pay a certain amount and the same is debited on instructions of the account holder and credited to the other account as per the instructions. 
9. As far as insurance Policy is concerned, the insured has to give confirmation with respect to continuing of the Policy or instructions, if there is any change in the policy amount due to deduction or addition of the members to be covered, and as such there cannot be any auto debit.
10.  As per the proposal form, it was clearly mentioned that the proposer/Complainant authorised IOB to transfer the premium amount under this proposal from her account with the bank to the account of insurance company. The bank had received regular instructions from the Complainant for renewal of the Policy. It is submitted that Complainant received the renewal notice from the Insurance Company in the year 2010-12 after the first day and instructed OP Bank to pay the premium by debiting her bank account.  OP1 admits that fourth year Policy covered a period from 12.1.2013 to 11.1.2014. However, the premium of the Policy could be transferred only on receiving the instructions from the Complainant.  As no instructions were given by the Complainant, the premium for the fifth year was not paid.
11. OP2 and OP3 in their reply have stated the Complainant is neither a consumer nor a beneficiary and as such has no locus to file the complaint. OP2 and OP3 have admitted the fact that IOB Health plus was a joint venture between OP1 and OP2, and other facts are stated as a matter of record.
12.  It is stated that Complainant have purchased a Health Care Policy for Rs.1,00,000/- in the year 2009. The Claim of the Complainant was not accepted as there was no contract of insurance between the Complainant and OP during that period of ailment. It is submitted that insurance between the parties are governed by terms of contract, and such terms have to be strictly construed to determine the liability of the insurer. 
13.  It is admitted that the existed insurance Policy for the period between 12.1.2013 to 11.1.2014. However, the fifth year insurance Policy was renewed by the Complainant on 20.1.2014. The complainant was hospitalised on 18.1.2014. Therefore. There was no contract of insurance in between the Complainant on one side and OP2 and OP3 on the other side for the period running between 12.01.2014 and 19.1.2014. As the Complainant was hospitalized on 18.1.2014 there was no substantive insurance contract at that point of time.
14.  It is submitted that the Complainant had acted in the negligent manner at the time of renewal of the fourth year Policy too, as there was a break of 12 days.  And the fifth year Policy was also renewed with a break of 8 days.  OP2 and OP3 prays for dismissal of the complaint. 
15. OP4 did not appear despite service and was proceeded Ex-parte vide order dated 1.9.2017. 
16. Complainant has filed Rejoinder reaffirming the facts of the complaint.  Complainant has also given details of the premium amount paid by OP1 to OP2 from her savings account.

17. The Complainant in her evidence has exhibited the following documents by way of affidavit:-

• Copy of Bank Passbook exhibited as Mark-A
• Copy of Health Insurance Claim Form exhibited as Mark-B.
• Copy of letter of OP4 exhibited as Mark-C
• Copy of the bills paid by the Complainant exhibited as Mark-D (Colly).

18. OP1 in her evidence has exhibited the following documents in his evidence:

• Copy of Power of Attorney exhibited as EX RW1/1.
• Copy of Proposal Form exhibited as EX RW1/2.

19. OP2 and OP3 in their evidence have exhibited the following documents:-

• Copy of IOB Health Care Plus Policy exhibited as OPW2/1.
• Copy of Health Insurance Claim Form dated 18.02.2014 exhibited as OPW2/2.
• Copy of renewed Policy dated 21.1.2014 exhibited as OPW2/3. 
• Copy of letter dated 3.4.2014 sent by OP4 exhibited as OPW2/4. 

20. The Commission has perused the record and considered the arguments advanced by all parties. It is admitted that there is joint venture between OP1 and OP2 in the policy product name IOB -Health Care Plus Policy. It is admitted that Complainant purchased this policy in the year 2009, which was being regularly renewed after payment of premium by OP1 Bank to OP2 Insurance Company, and premium was being paid by OP1 and OP2 every year.
21. It is not disputed that Complainant was admitted in Sir Ganga Ram Hospital on 18.02.2014 for treatment of Interstitiel Lung disease and Hiatus Hernia.  The Complainant paid the fifth year premium on 20.01.2104 though the premium was due on 12.01.2014. As there was no Insurance cover at the time of admission the claim was repudiated by the Insurance Company, OP2 and OP3. 
22. The Complainant submits that the premium has been paid by OP1 bank to OP2 Insurance Company through a form of auto debit in previous years and the premium was being automatically debited from Complainant’s A/c and transferred to the Insurance Company’s A/c.  
23. OP1 bank while admitting that as per proposal form, the complainant had authorized IOB to transfer premium amount from her account yet has disputed this contention on the ground that specific instructions were being given by the Complainant to the bank for debiting the premium every year, after receiving renewal notice from the Insurance Company.  Complainant has filed bank statement showing regular debit of premium since 2009. 
24. OP1 bank has relied on proposal form of IOB Health Care Plus filled by the Complainant.  Relevant portion is reproduced as under:

“I hereby agree that this proposal and declaration herein shall form the basis of the contract between me and the Universal Sompo General Insurance Co. Ltd. I hereby authorize IOB to debit and transfer the required premium payable under this proposal from my A/c to the Insurance Company.”

25. It is evident that Complainant has authorized IOB i.e. OP1 bank to pay the required premium of the policy. It is also not disputed that OP1 has to deduct the required amount from the saving bank account of complainant and has to pay to OP2. The dispute is restricted only on the point, as to whether every year fresh instructions were to given to bank, or whether it was an auto debit. OP1 has not filed any document/instruction/letter by Complainant to show that the specific instructions were being given by complainant every year to pay the premium to OP2. Yet, the premium was regularly being transferred from the Bank OP1 to Insurance Company for four years.  No affidavit of evidence by a bank employee to prove that instructions have been received by him/her for the payment of complainant’s premium every year has been placed on record.  OP1 bank has also not produced the details of joint venture between the Insurance and the bank which would have shown as to what instructions are required for transfer of premium by the bank from the complainant. It is thus clear that the OP1 has not filed the best evidence available with it, to prove its contention that the complainant every year had been giving the instruction to bank to pay the amount of premium to the insurance co. The Commission is also of the opinion that if such instructions are required every year, then what is the necessity of having any joint venture between OP1 and OP2, and in that case, complainant alone by himself would have been doing its part.  
26. OP2 and OP3, the Insurance Company, have filed a copy of renewed Insurance policy covering a period of one year from 20.01.2014 to 19.01.2015. The relevant portion is reproduced as under:

“The policy has been renewed with continuity in insurance subject to that no claim being paid.  Clauses/endorsements attached for, expenses incurred on any kind of treatment/ ailment during the breaking period.”

27. In fact it appears that both i.e the bank and Insurance Company had been quick to issue policy and then deducting the money from consumer’s account, and they both are at ease, if claim is not being lodged. The moment the claim is lodged then all ‘if and buts’ would arise.
28. In this matter it is admitted fact that the OP1 and OP2 had a joint venture by which OP2, the Insurance Company had to insure all the customers of the bank i.e. those persons who have a bank account with the OP1 and the OP1 was not recommending for the Insurance of a person who is not having a bank account with the bank.  This interalia means that on account of certain understandings. OP1 had to provide the datas/details of the person/account holder of the bank to OP2 and then OP2 would pursue them for having an Insurance and the OP1 has guaranteed that it would pay the amount from the saving bank account of the account holder to the Insurance Company to promote the business of OP2. If this understanding would not have been there, the Complainant/ bank customer would not be requiring the help of OP1 at all.  Therefore, in a joint venture the liability of OP1 and OP2 in providing the services to the account holders were joint and several.  OP1 otherwise has admitted that Insurance Company has to write a letter to the consumer as well as Bank and then Bank had to deduct the amount from the saving bank account of the customer of the complainant/account holder and remit the same to the insurance company for the purpose of insuring the account holder.  In the present matter it has not come on record as to whether OP2 has written any letter to OP1 or the complainant, thereby requesting for remittance of the Insurance for the fifth year and even otherwise the OP4 who is the agent of OP1 and OP2, have not responded immediately to the Complainant with respect to his request for arranging cashless facility.  Therefore, the deficiency on the part of OP1 and OP2 to OP4 stands established. 
29. In a latest Judgment titled Shekh Umar Farooq V/s Flipkart Pvt. Ltd., 2022 SCC online NCDRC page 519 decided on 26.07.2012, the Hon’ble National Consumer District Redressal Commission (NCDRC) has interalia held that if there is a tripartite contract between the seller, service provider and the consumer, then seller and service provider are liable for any defect or deficiency of service or unfair trade practice on the service provided or the goods/ product sold.
30. Thus, we find OP1 bank has failed to prove that the complaint had been imparting instruction to it every year to transfer the premium charge to OP2, and OP2 has failed to prove that it has written a letter to OP or to the complainant for remittance of the premium, where as the complainant has been able to prove the deficiency was there on the part of OP1 in not transferring the premium amount to OP2, the Insurance Company, thereby defeating the very purpose of joint venture.
31. It is worth observing the OP1 has not taken any stand w.r.t. having no amount in the Saving Bank Account of complaint worth remitting to the OP2. The Complainant has annexed hospital bills amounting to Rs. 46,788/-, doctor consultation receipts amounting to Rs. 800/- and receipts from the medical store amounting to Rs. 2,386/-.  The total amount comes to Rs. 49,974/-.

Thus the Commission holds OP1, OP2, OP3 and OP4 i.e. all OPs guilty of deficiency in service and thereby.

1. Direct OPs it to pay Rs. 49,974/- with 9% interest from the date of claim till realization jointly and severally.
2. This Commission also awards a compensation of Rs. 5,000/- for mental stress and agony and Rs. 5,000/-towards litigation expenses to be paid by OPs jointly and severally.

This order be complied with within 30 days from the date of receipt of the order.

Copy of the order be supplied / sent to the parties free of cost as per rules.

File be consigned to Record Room.

Announced on 23.09.2022

Delhi.