Haryana

Panchkula

CC/21/2015

HARBHAJAN SINGH. - Complainant(s)

Versus

KOTAK LIFE INSURANCE. - Opp.Party(s)

COMPLAINANT IN PERSON.

23 Jun 2015

ORDER

BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM,  PANCHKULA.

                                                         

Consumer Complaint No	:	21 of 2015
Date of Institution	:	23.01.2015
Date of Decision	:	23.06.2015

Harbhajan Singh Bains s/o late Capt. Sadhu Singh, R/o House No.122, Shivalik Enclave, Chandigarh-160101.

                                                                                      ….Complainant

Versus

 

1. Kotak Life Insurance, SCO 330, 1^st Floor, Sector-9, Panchkula, Haryana through its Branch Manager.

2.       Kotak Life Insurance Ltd., Registered office, 9^th Floor, Godrej Coliseum, Behind Everard Nagar Sion (E) Mumbai-400022, through its Director.

                                                                        ….Opposite Parties

 

COMPLAINT UNDER SEC. 12 OF THE CONSUMER PROTECTION ACT, 1986.

 

Quorum:               Mr. Dharam Pal, President.

              Mrs.Anita Kapoor, Member.

 

For the Parties:     Complainant in person.

                             Mr.Puneet Tuli, Adv., for the Ops.

ORDER

(Dharam Pal, President)

 

1. The complainant has filed this complaint under Section 12 of the Consumer Protection Act, 1986 against the Ops with the averments that he obtained an insurance policy No.01978848 in April, 2010 and gave premiums of Rs.99,990/- each on 28.04.2010, April, 2011, April, 2012. The complainant paid a total amount of Rs.2,99,970/- in three years for the policy. The complainant was informed by the representative of Ops that he would be able to withdraw the entire money paid as premiums alongwith good returns after paying premium for three years only. The complainant received a letter dated 04.04.2014 that the premium amount of Rs.2,99,970/- paid by the complainant has become now only Rs.2,13,908.52 and the complainant was shocked to know about the loss suffered to him. The complainant alleged that if he would deposit the amount in fixed deposit, it would have become more than Rs.4,00,000/-. The complainant contacted the company telephonically to know about the loss and he was told that the policy issued by the Ops was for 20 years, the first premium of Rs.99,990/- has been retained by the Ops and it would be returned only after the expiry of period of 20 years and that too if the policy is continued for 20 years. The complainant is 74 years old and the Ops did not bother to consider the complainant’s age while issuing the policy for 20 years. The complainant is a retired govt. officer and had invested in the policy that he would get it back after 3 years with good return. Further the complainant was surprised to know that remaining premium of about two lakhs of next two years paid to the Ops has grown by less than 2% per years, far less than the return available with the bank. The complainant also noticed that the policy documents have also not been received by him. The complainant wrote a letter to the Ops on 25.04.2014 to refund the premiums paid to them and for supply of policy documents. The Ops advised the complainant that he should continue the policy for 20 years as they knew fully that the complainant would not be alive for such a long period to claim the first premium paid. The Ops replied the letter of complainant that “we wish to inform that the first year premium is not allocated towards the investment fund and same is also mentioned in the policy document as under”. The complainant approached the Insurance Ombudsman but the Insurance Company did not agree to refund of Rs.99,990, the premium of first year and told that it could be returned only after 20 years if the policy continued for that period. During the hearing, the Ops did not produce any record that the policy has been delivered to the complainant and they only showed the copy of policy documents. Without having the policy documents, the complainant could not know that the policy was issued for 20 years. After seeing the copy of policy documents, the complainant came to know that the Ops had forged the signatures of his daughter Priya Bains as she could not have signed because at that time she was not there. But the Ombudsman dismissed the complainant’s request (Annexure C-6) mentioning that he had not raised the objection earlier of receiving the policy. This act of the opposite parties amounts to deficiency in service on their part. Hence, this complaint.
2. In reply, the Ops filed written statement by taking some objections and submitted that this Forum has no territorial jurisdiction as the office of Ops which was situated at Panchkula has already been closed. It is submitted that in the present case, the dispute related to unit linked policy and this Forum has no jurisdiction to decide the unit linked dispute. It is submitted that the complainant has not availed the free look period of the insurance policy. It is submitted that the complainant has paid 3 installments/premiums of the policy and now he could not say that he did not receive the policy in the year 2010 and was not aware of the policy’s terms and conditions. The complainant is not entitled to the refund of the full amount. It is submitted that the complainant has not raised any objection for non-delivery of the policy of insurance from the year 2010 and now he raised the objection firstly in the present complaint. It is submitted that the policy was based on the value of the units as would be there from time to time. It is submitted that the charges including surrender charges also payable and applicable in case of early surrender of the policy. It is submitted that the life insured the policy is not the complainant but is Ms.Priya Bains. It is submitted that the policy as had been obtained by the complainant was not an investment plan but was also covering the life of Ms.Priya Bains which is also evident from the documents submitted by the complainant. It is submitted that the policy had a combination of both investment and life coverage. It is submitted that the Ops are dealing in life insurance but the complainant was only interested in a fixed deposit and he would have deposited the same with the bank, not with the Ops. It is denied that there was forgery of any signatures. It is submitted that the complainant filed complaint before the insurance Ombudsman. It is denied that the policy document was not provided to the complainant. Thus, there is no deficiency in service on the part of the Ops and prayed for dismissal of the complaint.
3. In order to prove his case, the complainant has tendered the evidence by way of affidavit Ex.C-A alongwith documents Annexure C-1 to C-12 and closed the evidence. On the other hand, the counsel for the Ops has tendered the evidence by way of affidavit Annexure R-A alongwith documents Annexure R-1 to R-7 and closed the evidence.
4. Heard. The complainant has reiterated the averments made in the complaint and prayed or its acceptance whereas the counsel for the Ops reiterated the averments made in the written statement and prayed for the dismissal of the complaint.
5. After hearing both the parties and going through the record available on the file it transpires that as per the proposal form (Annexure R-1), the complainant is proposer for his daughter-Priya Bains to be insured. The date of birth of Priya Bains has been mentioned as 23.01.1978 and her gross annual income has been shown Rs.4,00,000/- from tution. She has been shown as self employed and her marital status has been shown ‘single’. The office address of the complainant has been shown as Department of Industries, Govt. of Punjab, Sector-17, Chandigarh and his designation has been shown as Assistant Director whereas against the column No.2.4 the source of earning has been shown Pension. From the above, it is clear that on the date of submission of proposal form, the complainant was retired from the Government service.
6. A person buys an insurance policy of the present nature on the advice of some person engaged or employed for that purpose by the insurance company.  On the proposal form (Annexure R-1) Abhishek Kumar Rai is mentioned as advisor/corporate agent/broker/Relationship Officer with licence No. 60121285. A person who offers for sale or sells the policy to the consumer on behalf of the Insurance Company is supposed to give him proper advice.  Not giving a proper advice amount to deficiency in service as well as unfair trade practice on the part of the Insurance Company on whose behalf the advisor prompts or motivates the consumer to purchase the policy.  In the present case, we find that from the following facts a clear inference is deducible that proper advice was not given to the complainant by the advisor and rather the policy was sold to him by misrepresenting the facts. The complainant categorically alleges and supports his allegation on oath to the effect that he wanted to purchase the policy for good return better than those available with the banks. On the other hand, the present policy which incepted on 30.04.2010 was to continue up to 30.04.2030 with 20 annual premium to the tune of Rs.99,990/- each. The complainant is duly alleged and supported his allegation on the affidavit to the effect that he was told that the lock in period of his investment amount of Rs.99,990/- was of 3 years after which he could be refunded it on request with interest guaranteed more than the banks. The complainant paid three premium of Rs.99,990/- each on 28.04.2010, April 2011, April 2012 and paid a total amount of Rs.2,99,970/-. However, on 04.04.2014, the complainant received statement of account (Annexure C-1) showing the total fund value of Rs.2,13,908.52 against the amount of Rs.2,99,970/- paid by the complainant. The complainant raised the protest on 29.04.2014 (Annexure C-2) and stated that the insurance agent at the time of selling policy showed the chart and data and assured return of his investment more than that given by the bank whereas the statement shows that even his capital has been reduced. He also stated that he came to know that the policy given to him is for 20 years.  He further stated that he is 73 years old what good is the policy for him for 20 years. He also stated that he is a retired person and had invested in the policy from his meager savings so as he has fund for taking care in his old age and not after his death.
7. The policy involved a huge annual premium of Rs. 99,990/-. No men of prudence who knows the terms and conditions of the policy would have purchase the policy in question. The Ops have not tender the affidavit of Abhishek Kumar Rai to prove that proper advice was given to the complainant and the terms and conditions of the policy were disclosed to, read over and explained to the complainant.
8. In their letter dated 12.05.2014 (Annexure C-8) the Ops stated that as per terms and conditions of the policy the complainant had 15 days free look period to return the policy and seek refund of the amount of his premium. They have also pleaded that policy was received by the complainant. In this regard they have, however, not proved any courier receipt or postal acknowledgement to show receipt of the policy by the complainant nor submitted affidavit of courier concerned. Even the written statement lacks material particulars in this regard viz. it does not disclose whether the policy was sent to the complainant through posts and Telegraph Department or through any courier. The complainant has categorically pleaded and supported it on oath that he never received the policy. Once the complainant never received the policy, question of his going through the policy documents and got the same cancelled within 15 days of free look period did not arise.  This also amounts to deficiency in service on the part of the Ops.
9. From the aforesaid discussion, it is clear that the complainant was never interested for the policy of such a nature which was never disclosed to him that the policy in question is for a period of 20 years.
10. The proposal form (Annexure R-1) contains 7 pages in which there is a column about the income details of the insured/proposer including its different sources. That page contains column to show whether the assured/proposer has got income from salary, business, agriculture or any other source. The amount of annual income from all or any of those sources and the proof of that income is to be incorporated in that column. In column No.1.11, the marital status of insured is shown ‘single’ and in column No.1.9 her annual income is shown Rs.4,00,000/-. Similarly, the income of the complainant/proposer is shown Rs.3,00,000/-.
11. In the column 2.4 source of earnings of the insured has been shown tuition income and of the complainant/proposer from pension.  However, neither any copy of the pension payment order or any proof of tuition income is attached. However, Ops failed to place on record any cogent evidence to show that the insured as well as complainant was really having income of 4 lakh and 3 lakh as shown in Clause 1.9 against the gross annual income. Occupation of the insured has been shown self-employed. It may be repeated that had the complainant really had that much annual income, he would have definitely opt to continue with that policy. Then request for refund the amount paid, proves that the policy was issued without their knowledge and consent of its contents and without making them aware of terms and conditions. It is also beyond comprehension how a retired person/tutor would survive by sparing an amount of Rs.99,990/- out of total income of Rs.3 lakh and Rs. 4 lakh. That again shows that filing up of the proposal form was a sham formality and Abhishek Kumar Rai just wanted to extract money from the complainant to earn a fat commission from the same for himself. 
12. The reply of the complaint was filed through Sh.Sandeep Suri & Sh.Puneet Tuli learned counsel for Ops No.1 & 2 but the same has not been signed by any competent person authorized by his company and the affidavit in support of the written reply is filed by Shakil Ahmad, Senior Manager, Legal Manager of Kotak Mahindra Old Mutual Life Insurance Company. He has not annexed any authority affidavit. Hence, he was not authorized by the company i.e. Op to file the affidavit and documents in the District Consumer Forum on behalf of the company so the same also cannot be read into evidence and the complaint is liable to be accepted only on this score.   
13. Though it is to state the obvious that a signatory to a documentation would be expected to bind himself, it too cannot be denied that a person aged 74 years would not be expected to obtain a policy for a duration of 20 years. It is further pertinent to notice that the complainant is a retired person and he is not indicated to have had the financial resources enabling him to pay up the large amount of premium every year. All these factors appreciated conjunctively indicate that there was more to it than meets the eye and the impugned transaction was, by any stretch of logical interpretation, was plainly unconscionable and the complainant was tricked into it.  
14. For the reasons recorded above, the complaint is allowed. The Ops are jointly and severally directed to refund the complainant his premium amount of Rs.2,99,970/- paid by him. The Ops are also directed to pay Rs.5,000/- to the complainant as costs of litigation.
15. The abovesaid order shall be complied with within 30 days of its receipt by the opposite parties; thereafter, opposite parties shall be liable for interest @ 9% p.a. on the amount of Rs.2,99,970/- from the date of filing of complaint, till it is paid, apart from the cost of litigation of Rs.5000/-.
16. Certified copy of this order be communicated to the parties, free of charges. After compliance file be consigned to record room.

 

 

Announced

23.06.2015           ANITA KAPOOR                            DHARAM PAL

                             MEMBER                               PRESIDENT

 

Note: Each and every page of this order has been duly signed by me.

 

    

                                 

                                                         DHARAM PAL

                                                          PRESIDENT