PER SHRI. S. G. CHABUKSWAR – HON’BLE  MEMBER

1)        By this complaint the Complainant has prayed for the reliefs against the Opposite Party for payment of balance amount of Jeevan Akshay Policy Rs.2,73,774/- with interest @ 18% p.a., Rs.2,00,000/- compensation for mental agony and cost of the complaint.

2)        The case of the Complainant in short is as under –

One Mrs. Kavita Khaitan, Agent of Opposite Party had given information to the Complainant about Jeevan Akshay Policy. The said agent never informed the Complainant that the policy holder will not get the amount Rs.10,00.000/- return back during her life time.  The Opposite Party issued to the Complainant above policy bearing No.902418159 on 06/09/2004.  In the said policy there was no risk cover and only one time premium Rs.10,00,000/- was required to be paid and no installment was to be paid by the Complainant.  The said policy was just like a payment of fix interest on fix deposit.  In every policy of the Opposite Party there is provision to get the amount back before maturity period.  However, in the Jeevan Akshay Policy - II Plan there was no maturity period and only provision that till death of policy holder will get pension or annuity of Rs.3,858/- p.m.  The Complainant has received total amount Rs.1,73,610/- as annuity/pension for the period of July, 2004 to March, 2008 in 44 installments. In the month of August, 2007, the Complainant wrote letter to the Opposite Party and requested for cancellation of said policy as she was in need of money to meet her medical and personal expenses which were urgent and unavoidable. On 08/10/2007 Opposite Party has sanctioned the surrender value Rs.7,07,716/- and requested her to give her consent for the sanctioned surrender value.  She has not given oral or written consent to the said surrender value till filing of the complaint. 

3)        The further case of the Complainant is that the Complainant had requested the Opposite Party for review of the surrender value by the letter dtd.02/11/2007.  On 12/11/2007, the Complainant also raised grievance before the Secretary of the Insurance Ombudsman by the letter stating that Rs.10,00.000/- will be paid to her nominee after her death but why she was not entitled for the same as the provisions of maturity period and risk cover are not in the said policy.  On 21/11/2007 office of the Insurance Ombudsman issued letter to the Complainant and informed that she should represent her case before higher officers of the Insurer as per RPG Rules and if the Complainant did not receive reply within one month or she does not satisfy with the reply of such higher officer the Complainant can apply to the Insurance Ombudsman.  On 26/11/2007 Opposite Party by the letter had given the details of surrender value but failed to provide calculation.

4)        According to the Complainant, on 28/12/2007 she also made representation to the Regional Manager CRM of Opposite Party and requested for review of surrender value mentioned in the letter dtd.08/10/2007.  On 04/01/2008 the Regional Manager uphold the decision of Opposite Party dtd.08/10/2007.  On 17/01/2008 Insurance Ombudsman by the letter informed to the Complainant that her complaint has been closed on their side.  On 21/01/2008 the Complainant wrote letter to the Chairman of Opposite Party and request to resolve the issue of surrender value sympathetically.  On 12/03/2008 the Complainant under protest requested to the Opposite Party for payment of surrender value as she was in need of money for medical expenses. 

5)        According to the Complainant, on 18/03/2008, Opposite Party had sent cheque of Rs.7,26,226/- by the letter to her.  The Complainant received the said amount under protest.  On 21/04/2009 the Complainant sent letter to Opposite Party and requested for early hearing of her application. The CRM Department by their letter dated 03/08/2009 sent her the calculation of surrender value. The Complainant had made representation to the Secretary of the Insurance Ombudsman and requested to take appropriate action against the Opposite Party to safeguard her interest by the letter dtd.20/10/2009.  The Secretary of Insurance Ombudsman by his letter dtd.10/11/2009 refused to take cognizance of her representation and given liberty to approach to any other Forum. Lastly on 08/01/2010 Complainant issued notice through her advocate and demanded from the Opposite Party balance amount Rs.2,73,774/-. Opposite Party served with the said notice but in vain.  Opposite Party has wrongfully deducted the amount of surrender value.  The Complainant caused the mental harassment due to the deficiency of service of the Opposite Party.  Hence, this complaint for the reliefs mentioned in above para no.1.

6)        The Opposite Party has resisted the claim by filing written statement. The contentions of the Opposite Party is that, the Complainant has voluntarily and willingly taken the policy in question fully knowing its terms and conditions.  The Complainant had also received the annuity installments of Rs.3,858/- from the Opposite Party from July, 2004 to March, 2008 which clearly goes to show that the Complainant had accepted the terms and conditions of the policy.  As per the policy condition mentioned on the back of the policy, the said annuity policy had not acquired any surrender value.  However, the Opposite Party had subsequently decided to allow the surrender value under Jeevan Akshay II Plan 163 and the payment of surrender value is governed by the terms and conditions mentioned in the circular bearing No.CO/CRM/584/23, dtd.17/05/2007.  The policy of the Complainant came within the provisions mentioned in the said circular. The Opposite Party paid the surrender value to the Complainant against the said policy as very special case even though the Complainant was not entitled for the same under normal circumstances as per the conditions contained in the said policy.  Opposite Party has not violated any of the terms and conditions of the policy in question. Opposite Party has also not committed any breach of the said policy.

7)        The further contentions of the Opposite Party is that, Opposite Party by their letter dtd.03/08/2009 informed the Complainant that surrender value is a combination of factors applied to the purchase price paid by the annuitant and shall be lower than the purchase price.  The Complainant was also informed that annuity plan are issue for life of the annuitant and withdrawal from the policy i.e. annuity surrendering her policy at any time during her life is selections against the life office since annuity is calculated on the basis of the longevity of the annuitant.  Opposite Party by their letter dtd.03/08/2009 had explained to the Complainant the formula of calculation of the surrender value of the policy.  The Complainant had given her consent to accept the surrender value from the Opposite Party by her consent letter dtd.12/03/2008.  Now the Complainant is trying to demand excess payment illegally.  The Complainant can not take advantage of the representation made by her to the higher authority.  The Complainant has accepted the surrender value unconditionally on 18/03/2008 and therefore, the cause of action arose on 18/03/2008.  The complaint is time barred.  The Opposite Party has denied all other rival contentions of the Complainant and prayed for dismissal of the complaint with cost.     

8)        The Complainant has submitted her affidavit of evidence on 16/12/2011.  The Opposite Party has submitted affidavit of evidence of Pradip Chandrakant Sukale, Manager. The Complainant and Opposite Party have field their respective written notes of arguments. We have gone through the documents filed by both the parties.  We heard the oral arguments of Smt. Ishita Bhagat, Ld.Advocate for the Complainant and Shri. Navin Kumar Poojari, Ld.Advocate for the Opposite Party. 

9)        Admittedly Opposite Party has issued the annuity policy Jeevan Akshay – II Plan 163 known as person policy bearing No.942018159 dtd.06/09/2014, in the name of the Complainantw.e.f.28/06/2004.  The Complainant paid to the Opposite Party one time premium in lumpsum Rs.10,00.000/-. The Opposite Party has paid to the Complainant annuity installment of Rs.3,858/- from July, 2004 to March, 2008.  In the month of August, 2007 the Complainant had applied for surrender of the said policy.  The Opposite Party considered the request of the Complainant and paid her surrender value of the policy Rs.7,26,226/-. The Complainant had requested to the Opposite Party and various competent authorities for review of decision of surrender value by the letters which are submitted alongwith the complaint at Exh.C, E, F. H & I.

10)      The Opposite Party comes with the case that, there was no provisions of surrender value in Jeevan Akshay – II Plan – 163 Policy.  The payment of surrender value to the Complainant is governed by the terms and conditions mentioned in the circular bearing No.CO/CRM/584/23 dtd.17/05/2007. Opposite Party has produced the terms and conditions of LIC’s Jeevan Akshay – II Table No.163 dtd.08/10/2003.  The Complainant has obtained policy in question w.e.f.28/06/2004. Hence, above terms and conditions are applicable to the case of the Complainant.  It has been mentioned at page no.2 that “No surrender value will be available under this plan.” According to the Complainant, the agent of the Opposite Party never disclosed her above condition of the policy in question.  As per the pleading of the Complainant all the conditions of policy were disclosed to her by the agent except above one.  It is not the case of the Complainant that she did not receive the copy of policy immediately after payment of one time premium. Opposite Party alongwith written statement submitted copy of policy in question issued to the Complainant.  The terms and conditions are with the policy in question which was issued to the Complainant.  The Complainant has accepted the annuity amount.  Under these circumstances it can not be said that she was not having knowledge of clause of surrender value of the policy in question.  The Complainant has produced a copy of terms and conditions of LIC’s Jeevan Akshay Plan No.144 dtd.01/07/2000. However, it has been contended in the terms & conditions of LIC’s Jeevan Akshay – II  Plan 163 dtd.08/10/2003 that Jeevan Akshay – I  Table No.144 has been withdrawn w.e.f.16/10/2003.  Hence, the terms & conditions filed by the Complainant as regards Plan No.144 of the Jeevan Akshay does not support the case of the Complainant. 

11)      The Opposite Party has produced a circular of central office of LIC dtd.13/01/2007.  The Executive Director (CRM) on the basis of circular of central office dtd.13/01/2007 issued a circular on 17/05/2007.  As per above two circulars the surrender value may be allowed only under the policies which are annuity for life with return of purchase price on death and the surrender is to be allowed generally on merits if the money is required by the annuitant for expenses incurred or to be incurred on his/her medical treatment or for the treatment of his/her spouse.  The evidence and documents produced by the Opposite Party clearly goes to show that previously there was no provision of surrender value in the policy in question.  The provision of surrender value has been made in the policy in question by the circulars dtd.13/01/2007 & 17/05/2007.  Opposite Party has sanctioned the surrender value on the basis of circular dtd.17/05/2007 and hence, there is no deficiency in service on the part of the Opposite Party. 

12)      Smt. Ishita Bhagat, Ld.Advocate for the Complainant has argued that the Complainant has paid Rs.10,00,000/- to the Opposite Party as one time premium .  As per the policy in question Rs.10,00,000/- will be paid to the nominee after the death of the Complainant then as to why the Complainant is not entitled for the said amount during her life time as there is not maturity period and risk cover in the said policy.  However, the said argument and contentions of the Complainant are not based on any of the provisions of law or rules hence, it cannot be accepted. 

13)      Shri. Navin Kumar Poojari, Ld.Advocate for the Opposite Party has argued that the Complainant is only entitled for the amount of surrender value and she is not entitled to the amount claimed by her.  The advocate for Opposite Party in support of his argument relied on the judgment of the Hon’ble National Commission in the Revision Petition No.3694 of 2009, Department of Posts; Postal Life Insurance Punjab Circle Chandigarh V/s. Vinod Kumar decided in the month of Feb., 2010.  In the said case the Complainant had obtained Postal Life Insurance Policy in the year 2001. He had submitted application for surrender of the policy on 23/09/2004. The Complainant had paid 36 installments @ Rs.440/- and he had sought refund of Rs.15,840/-.  The Opposite Party had sanctioned payment of Rs.5,628/- being the surrender value of the policy. The Complainant had approached to the District Forum for  payment of the full amount Rs.15,840/- with interest and compensation.  The contentions of Opposite Party was that they paid the surrender value Rs.5,628/- to the Complainant on the basis of existing rules and letter no.29-14/98 dtd.18/11/2003.  The District Forum directed to the Opposite Party for payment of balance amount Rs.11,092/- with interest @ 9% p.a. and cost Rs.1,000/-.  The Hon’ble State Commission had confirmed the above order in appeal. The Opposite Party had approached to the Hon’ble National Commission.  The Hon’ble National Commission observed that,

      “It is clear that in case of surrender of policy after 36 months, the existing surrender factor was applicable to the policy in question.  Annexure – IV which is table for calculation of surrender value is applicable to all policies irrespective of the date of issue, and the same has been applied by the Opposite Party in the case of applicant as can be seen from the calculation of surrender value which is at page no.69 and 70 of the record.  The District Forum and State Commission had totally ignored the letter dtd.18/11/2003 in so far as it had laid down that the existing surrender factor would be applicable to the policies in case of surrender.  There is no merit in the submission of the Complainant that the said letter is not applicable in his case.  The Complainant was entitled to only surrender value as per the surrender factor.”  

14)      In the case of LIC of India V/s. Ramesh Chandra, Revision Petition No.755 of 1996, decided on 11/04/1997 reported in the Hon’ble S.C. & National Commission Consumer Law cases 1996-2005, Vol – I page No.121 the Hon’ble National Commission observed that, District Forum and State Commission had no jurisdiction to go beyond the terms and conditions of the policy bond.

15)      In the present case though there is no risk cover in the policy in question as pleaded by the Complainant but the Opposite Party has sanctioned the surrender value to the Complainant on the basis of circulars of central office dtd.13/01/2007 and circular of Executive Director (CRM) dtd.17/05/2007.  In view of the observations made by the Hon’ble National Commission in the above mentioned two cases this Forum cannot go beyond the terms and conditions of circulars issued by the competent authorities of the Opposite Party.  In view of this we hold that there is no deficiency in service on the part of the Opposite Party.

           In the result complaint deserves to be dismissed.  Considering the nature of the complaint both parties have to bear their own costs.  Hence, we proceeds to pass following order –

             O R D E R

                     i.     Complaint No.213/2010 is dismissed.

            ii.     Both the parties shall bear their own costs.  

                   iii.    Certified copies of this order be furnished to the parties.