BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION AT BANGALORE (URBAN)

DATED 7^TH DAY OF JUNE 2023

ORDER

SMT. K. ANITA SHIVKUMAR, MEMBER

Complainant filed this complaint U/S 35 of Consumer Protection Act 2019, claiming to settle the insurance claim of Rs.2,00,000/- in respect of late Rama Dut under PMJJBY scheme along with penal compound interest at the rate of 24% per annum with effect from 13.06.2022, compensation of Rs.5,00,000/- towards damage cost for deficiency of service, hardship, harassment and mental agony, Rs.5,000/- towards cost of litigation and such other relief.

2. Brief facts of this case are as follows:-

Complainant and his wife are joint account holders in OP bank, the wife of complainant expired on 17.05.2022. Complainant is the nominee/legal representative of the deceased Rama Dut who is wife of complainant. OP bank is a scheduled bank under supervision of Reserve Bank of India (RBI) in terms of Banking Regulations Act and also approved by Companies Act, is involved in the business of banking, financial services, personal finance life insurance and wealth management, etc. Complainant stated that he was holding joint savings account No.204010129878 along with his wife Smt. Rama Dut in OP Bank, since 2008. He and his wife opted for subscription of Pradhana Manthri Jeevan Jyothi Bhima Yojana, here after (PMJJBY), Government of India scheme through OP bank for himself and his wife for the aforesaid joint account number for auto debit. Complainant stated that under PMJJBY scheme, people in the age group of 18-50 years having a bank account are eligible to join the insurance scheme which covers life risk of Rs.2,00,000/- in case of both of the insured died due to any reason. Complainant further stated that KMBL Bank (OP bank) is one of the master policy holders under the insurance of LIC of Indian offering PMJJBY to its account holders. The features, terms and conditions of the insurance cover offered by KMBL are informed to the account holders, the subscription of PMJJBY in this case in respect of his wife Smt. Rama Dut was proved by OP bank and the premium deposit of Rs.330/- for the year 2021-2022. The period commenced with effect from May 2021. The premium for renewal of PMJJBY scheme for the year 2022-23 was also debited from the aforesaid account on 30.05.2022 in respect of the complainant and his wife. As stated earlier complainant’s wife passed away on 17.05.2022. After her demise the account was frozen. By regular follow ups the account was activated after the deletion of deceased account holder. As per the terms and condition on PMJJBY scheme complainants submitted the claim form along with requisite documents to OP bank claiming the same of Rs.2,00,000/-.

3. As per the terms of the scheme OP is required to settle the claim of the complainant since he is a nominee of the deceased and also as per the scheme, paid premium towards policy. In response to the claim for the payment of sum assured, one Miss. Shivani Kumari, delivery officer KMBLH has replied that PMJJBY is linked with complainant’s CRN (Customer Relationship Number) not with Rama Dutt’s CRN, through E-mail dated 16.06.2021. She admitted and confirmed that PMJJBY subscription amount in respect of Rama Dutt has been received by them. In pursuant to the E-mail from OP bank, complainant replied on 16.06.2021 stated that premium towards the subscription to PMJJBY in respect of Rama dut has been recovered from joint account No.204010129878 held by him and his wife and linking the CRN in is an internal process of the bank, for which complainant is not responsible. Complainant stated that due to the undue delay on the part of bank in settling the claim without any valid reason, he took up the matter to the branch manager on 28.07.2022 and 29.07.2022. Despite several reminders the branch manager has not taken any action for settling the claim of the complainant. He neither replied to the requests of the complainant. Complainant got issued legal notice dated 11.08.2022 calling upon OP for the settlement of PMJJBY insurance claim of Rs.2,00,000/- along with interest of 24% per annum, Rs.10,00,000/- for compensation. In response to the legal notice, authorized signatory of OP bank has sent letter on 09.09.2022 stating that after verifying all the details pertains to insurance and account, they will revert back to the complainant. But OP did not take any action and informed to the complainant with regard to the settlement of claim. Therefore complainants issued another notice on 11.10.2022.

4. Complainant alleged that OP bank has denied the subscription of his wife under PMJJBY insurance scheme and accordingly declined the claim settlements, its deficiency of services on the part of OP. Complainant also alleged that the authorized signatory of OP is erroneous and factually incorrect, since OP had proved the subscription of the late Smt. Rama Dutt and recovery of amount of Rs.330/- towards subscription under PMJJBY scheme on 30.05.2021 for the year 2021-22 from the joint account No.204010129878 held by the complainant and his wife. After approval of subscription to the scheme and received the premium amount, rejecting the claim on the ground on non-linking CRN to policy, is intentional deny the legal claim. Complainant alleged the deficiency of service on the part of OP by collecting the premium amount and not settling the claim to the insurer caused mental agony, hardship to the complainant. Therefore complainant approached this commission claiming the above.

5. OP No.1 and 2 represented through their counsel and filed statement of objection along with certificate under section 65B of Indian Evidence Act. OP’s stated in their version, that OP No.1 and 2 are one and same entities. Hence here after reffered as OP. OP denied all the allegations of complainant. OP admitted that the complainant and his wife are account holders of OP, bearing joint account No.204010129878 at MG road, Bangalore, in 2015 complainant enrolled for PMJJBY scheme via CRN No.117147373 in the name of complainant. In August 2016, complainant enrolled for PMJJBY scheme through CRN No.32910163. OP state that on both occasions of 2015-16, complainant enrolled himself for the PMJJBY scheme and deducted the subscription amount even from joint account. Further stated that the policy was for one person only, i.e, complainant. OP contends that complainant has insisted of availing PMJJBY policy in the name of his wife. OP stated in his version that the scheme offers life insurance cover for death due to any reason, is offered/administered through LIC and other life insurance companies with necessary approvals and tie ups with banks/post office for this purpose. OP contends that since there was no PMJJBY policy in the name of late Smt. Rama Dutt OP could not honour the claim of the complainant, since the subscription was not deposited in the name of deceased. OP denied that the action was frozen and was activated after continuous follow ups and also denied that CRN is an internal process of OP. OP contends that customer’s CRN linked to the insurance policy in respect of the joint account instead of his wife’s CRN. Hence OP stated that the claim of this complainant is declined rightly and repudiated the claim on the ground supra. OP stated that has not caused any deficiency of service, no fault on their part through OP prayed  to dismiss the complaint with cost.

6. Both the parties have filed their affidavit evidence by way of oral evidence. In support of oral evidence complainant filed 13 documents along with certificate U/S 65B under Indian Evidence Act. The documents are marked as Ex.P.1 to P.14. Later OP also filed 3 documents which are marked as Ex.R.1 to R.3. Bothe the parties have reiterated in the affidavit as they stated in their complaint and version respectively.

7. The points that would arise for our consideration are as under:-

i) Whether the complainant proves that OP’s caused deficiency of service?

ii) Whether the complainant is entitled to get relief as sought?

iii) What order?

8. Our findings on the afore said points are as follows:-

Point no.1:- In affirmative.

Point No.2:- In partly affirmative.

Point No.3:- As per the final order.

REASONS

9. Point No.1:- Complainant and his wife had joint account with OP Bank since 2008, account bearing No.204010129878. He opted for enrollment for Pradhana Manthri Jeevan Jyothi Bhima Yojana (PMJJBY), a scheme of Government of India through KMBL (OP bank) for himself as well as in respect of his late wife Smt. Rama Dutt under the aforesaid joint account number for auto debit, which is undisputed. As going through the above scheme, is available in the people in the age group of 18-50 years having bank account given through consent to join/enable auto debit to life cover on Rs.2,00,000/- shall be for 1 year period stretching from 1^st June to 31^st May and will be renewable. Risk under scheme is for Rs.2,00,000/- in case of death of insured due to any reason. Accordingly OP bank is one of the master policy holders under the notice of LIC of India offering PMJJBY policy to its amount holders which is at Ex.P.2. OP have no dispute with the same.

10. As Complainant stated he had joint account with his wife who expired on 17.05.2022. Immediately after her demise OP has frozen joint account No.204010129878. After several follow ups and requests from complainant, OP activated the said account after the deletion of deceased. Complainant has produced the death certificate of his wife which is at Ex.P.6. As per the terms and conditions and the features of the scheme. Complainant gave his consent to the OP bank for auto debit of premium amount Rs.330/- towards PMJJBY insurance scheme. After the death of his wife he claimed the said insurance amount of Rs.2,00,000/- from OP bank in favor of complainant as he is Co-account holder. In pursuant to the claim of the complainant Relationship Manager of OP bank replied on 16/6/2022 stating that PMJJBY insurance is linked with complainant’s CRN, not with complainant wife's CRN. At the same time she admitted and confirmed that the subscription amount in respect of his wife has been received which he is at Ex. P7 and Ex.P.8. The same has been confirmed by complainant through email which is at Ex.P.9.

11. It is pertinent to note that the amount of premium is deducted from joint account. On perusal  of version filed by OP, complainant has 2 accounts first account enrolled for PMJJVY by scheme link with CRN number 117147373 in the name of Rama Kumar Dutt, who is complainant. In 2016 complainant account enrolled for PMJJBY scheme through CRN No.32910463 wherein complaint is an authorized signatory. Considering the above statement of OP we observed that complainant had 2 accounts, one is in his name solely and second one is in joint account along with his wife. Both the accounts linked with PMJJBY insurance scheme. Here we observed that from Ex.P.2, brochure of PMJJBY scheme, mentioned that ‘A person would be eligible to join the scheme through one savings bank account only’. Through this in our considered view, OP bank has linked both the policies to complainant’s CRN number/name by collecting premium amount twice. Complainant has also produced the bank account statement of May 2021, discloses that Rs.330/- has been debited automatically twice on 30.05.2021, it shows that the complainant has paid premium for 2 insurance policies of PMJJBY for the year 2021-22 which is at Ex.P.1. It also exhibits that during the period of May 2021 to May 2022. When the validity of PMJJBY insurance scheme the secondary account holder who is wife of complainant is expired on 17/5/2022/. Immediately after the death of complainant’s wife, OP bank has frozen the joint account till the deletion of her name from the account. It is has been deactivated. It means OP bank has very much aware about the death of secondary account holder.  OP even collected ₹330/- towards premium of said insurance policy for the year 2022 to 2023 which is at exhibit P5.

12. When the complainant claimed for insurance amount before OP the officials of OP bank informed the complainant that PMJJBY is linked to the CRN of complainant not with CRN of his wife. She also informed that the premium has deposited from joint account in the month of May. Therefore, complainant alleged that the linking CRN to the insurance policy is no way connected to the complainant. It is internal process of bank who has committed mistake by linking the same with his name. As we observed complainant has 2 accounts, first account which is solely in his name, linked with the CRN to PMJJBY is accepted. When he has 2^nd account which is joint one, OP bank could link the insurance policy with secondary account holder who has no other account than this. In connection to this above observations, scheme brochure which is at Ex.P.2 is clearly mentioned that “the person would be eligible to join this scheme through one savings bank account only”.  When we drew our attention to brochure, complainant has already one account linked with PMJJBY, OP could link the secondary account holder for 2^nd account who is his wife and has no other account at the OP’s bank, which would be benefited to the secondary account holder who is deceased in this case. Though OP has collected premium towards the PMJJBY insurance policy repudiating on mere on the ground that the CRN has not linked with the account holder since they know features and terms of policy. In case otherwise OP could inform to complainant to change the joint account CRN number linked with policy to his wife’s name. Keeping the complainant in dark and repudiated claim, is not fair and it is unjust. After he come to know that OP is rejecting is claim on the ground that CRN is not linked with his wife, he approached branch manager also and sent E-mail and requesting him to settle the claim amount. Being the manager of branch, he has not bothered to respond him in either way. Hence he issued legal notice calling upon OP to settle the claim amount on 11.08.2022 OP sent untenable reply to complainant. Hence complainant has alleged deficiency of service on the part of OP who has not honored his claim of insurance policy.

13. In our considered OP has collected premium amount for the year 2021-2022, and 2022-2023 with regard to the joint account but repudiating that complainant is eligible for the insurance policy has is CRN is linked with PMJJBY policy. In our considered view since he has primary account holder and his wife is secondary one, he is taking this contention. On perusal of Ex.P.4 and Ex.P.5 both account holders that is Raman kumar Dutt and Rama Dutt has given single CRN number together i.e, 117147373. On that view, we observed that one of the account holders are entitled to get the benefit of insurance policy, there is no bar for secondary account holder to claim the insurance. It also considered that since it is death, benefit by collecting the premium, wife of complainant died and claim of complainant is genuine.

14. By going through the document No.Ex.R.1 and Ex.R.2, OP has deleted the complainant from enrollment to the said insurance on the ground that he has completed the age of 55 which is maximum under the scheme that is on 26.05.2021. Though he has been deleted the enrollment OP has been deducted the premium amount of Rs.330/- twice for 2 accounts, is condemnable. It exhibits OP has indulging in unfair practice when the matter comes before them in collecting money, without any verification, they collect and when they have to pay for the beneficiary, explore several grounds to reject. In our considered view, OP will take two different stands and rejecting the claim of the customers, it is illegal under Consumer Protection Act 2019.

15. The evidence placed before the commission, that complainant has proved the deficiency of service on the part of OP by rejecting the claim of the complainant on mere mistake committed by OP. It is observed that there is no fault on the part of complainant, hence he is entitled to get the insurance benefit. Hence complainant has proved his case. On the above discussion we answer Point No.1 in affirmative.

16. Point No.2:- As he stated in the complaint, complainant has paid premium of Rs.330/- to avail the insurance policy under PMJJBY scheme. On the event of death of insured account holder, complainant claimed insurance amount before OP, is justifiable. Hence complainant is entitled to get Rs.2,00,000/- towards insurance amount in respect of the death of his wife. For the deficiency caused by OP obiviously caused the mental agony and inconvenience to the complainant for seeking the relief from pillar to post. For that complainant is entitled to get Rs.50,000/- as a compensation and Rs.10,000/- towards cost of proceedings. Complainant has prayed for the penal compound interest of 24% per annum, seems to be exorbitant. Hence he is entitled for 8% per annum on Rs.2,00,000/- from date of claim till realization. For the foregoing reasons Point No.2, in partly affirmative.

17. Point No.3:- In view of the discussion referred above, we proceed to pass the following:-

ORDER

1. Complainant U/s 35 is partly allowed.
2. OP’s are directed to pay Rs.2,00,000/- to the complainant towards insurance amount with 8% interest per annum from the date of scheme till realization.
3. OP’s are further directed to pay Rs.50,000/-  towards compensation and Rs.10,000/- towards cost of litigation, within 30 days from the date of order, failing which OP shall pay interest at the rate of 12% per annum on Award amount from the date of order till realization.

(Dictated to the Stenographer, got it transcribed and corrected, pronounced in the Open Commission on this 7^th day of JUNE, 2023)      

Documents produced by the Complainant-P.W.1 are as follows:

Documents produced by the representative of opposite party ;

CC/288/2022 ORDER 07.06.2023

1. Complainant U/s 35 is partly allowed.
2. OP’s are directed to pay Rs.2,00,000/- to the complainant towards insurance amount with 8% interest per annum from the date of scheme till realization.
3. OP’s are further directed to pay Rs.50,000/-  towards compensation and Rs.10,000/- towards cost of litigation, within 30 days from the date of order, failing which OP shall pay interest at the rate of 12% per annum on Award amount from the date of order till realization.