DISTRICT CONSUMER DISPUTES REDRESSAL FORUM-I, LUCKNOW

CASE No.157 of 2006

       Sri Sunil Triptahi, aged about 36 years,

       S/o Sri Omkar Nath Tripathi, Advocate,

       R/o 414/3, Ahata Gurdayal Sarai Malikhan,

       P.S. Chowk, Lucknow.

                                                                   ……Complainant

Versus

                 1. Life Insurance Corporation of India,

                    Divisional Office, Jeevan Prakash,

                    30, Hazratganj, Lucknow.

                    Through the Sr. Divisional Manager.

                2. Branch Manager,

                   District Branch Office,

                   Oriental Building,

                   Hazratganj, Lucknow.       

                                                                              .......Opp. Parties

Present:-

Sri Vijai Varma, President.

Smt. Anju Awasthy, Member.

Sri Rajarshi Shukla, Member.

JUDGMENT

This complaint has been filed by the Complainant against the OPs for directing the OPs to revive the policy will all benefits and refund of excess recovery of interest of Rs.643.00 and for payment of damages incurred on travelling of Rs.1,500.00, compensation of Rs.25,000.00 and cost of complaint.

          The case in brief of the Complainant is that the life of the Complainant was insured under policy No.211275851 for Rs.50,000.00 w.e.f. 28.04.1994 for the period of 20 years, the date of maturity being 28.04.2014. The Complainant paid the premium on the policy till 1996. The premium for the period 28.04.1997 to 28.04.2000 became due but could not be paid by the Complainant. The application for revival of the policy was

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moved on 23.04.2001. The Complainant was required to pay Rs.2,949.00 as per the revival quotation dated 23.04.2001. The Complainant deposited the said sum of Rs.2,449.00 on 26.04.2001. Thereafter the Complainant went to the office of the OP No.2 several times intimating that no letter of revival of the policy was received though all the formalities had been completed. The Complainant was asked to contact after 10-15 days but the OP No.2 passed no order for revival of policy. On 21.03.2003 the Complainant approached OP No.2 with application that the premium for 04/2001 and 04/2002 could not be deposited for want of the order for renewal of policy. The Complainant further mentioned that he wanted to deposit the premium with interest. It was also mentioned that for want of renewal of policy, the amount of late fee had considerably increased which was requested to be waived in the circumstances. The Complainant was surprised to receive a fresh bill for payment of Rs.5,843.00 for revival of policy termed as ordinary revival quotation dated 17.07.2003 waiving Rs.2,000.00 interest and adjusting Rs.5,000.00 as S.B. due on 28.04.1999. The Complainant paid the said amount of Rs.5,843.00 on 24.07.2003. The demanded money was deposited in full upto the year 2003. The OPs have charged Rs.643.00 in excess from the Complainant as described in the complaint. The OP No.2 failed to pass the order of revival of the policy on depositing the demanded money and completing other formalities on 26.04.2001. The OP No.2 again failed to pass revival order on depositing Rs.5,843.00 and completing other formalities on 24.07.2003. The Complainant went to the office of the OP No.2 for depositing the premium due on 28.04.2004 but it was learnt that the policy could not be revived on 13.12.2004. The OP No.2 returned the policy bond by registered post. The Complainant on 20.01.2005 sent letter with policy bond in original, to the OP No.2 to revive the policy within a week from the receipt of notice. Thereafter on

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19.10.2005 the OP No.2 sent cheque No.416864 dated 19.10.2005 for Rs.5,843.00 in favour of the Complainant alleging it as refund of policy deposit. The cheque in original was returned to the OP No.2 in view of the claim being lodged against the OPs. The OPs were bound to revive the policy and it stood legally revived when their proposal to deposit was made to the Complainant by way of revival quotation dated 23.04.2001 and it was accepted by the Complainant by payment of Rs.2,949.00 on 26.04.2001. The OP No.2 offered to revive the policy on payment of Rs.5,843.00 on 24.07.2003 and the Complainant accepted this offer also by making the payment on 24.07.2003 vide policy report dated 23.04.2004. All the formalities were completed both the times. No notice of non compliance of any formality in regard to revival of policy was ever received from the OPs. It was because of the negligence on the part of the OP No.2 that the revival orders were not passed within time which caused harassment and loss to the Complainant, hence this complaint.

          The OPs have filed the WS wherein it is mainly submitted that the Complainant had applied a policy of money back assurance with accidental benefit for the term of 20 years, sum assured being Rs.25,000.00 and accordingly an insurance policy was given to the Complainant. The Complainant had to pay Rs.1,587.00 as premium annually but the Complainant paid premium upto 1996 and thereafter he stopped paying the premium, hence the policy lapsed. On 23.04.2001 the Complainant approached the OPs for revival of the lapsed policy. He was given revival quotation dated 23.04.2001 according to which he was to deposit Rs.2,949.00 only alongwith DGH form “Declaration of Good Health” but the Complainant did not submit the DGH form, hence the policy could not revive. Thereafter the Complainant did not turn up for revival of the lapsed policy and again approached only on

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21.03.2003 with an application for revival of policy mentioning therein that he is agreed to deposit the premium alongwith interest. According to the terms and conditions of the policy bond the discontinued policy could be revived within the period of 5 years from the date of first unpaid premium and before the date of maturity. When the Complainant submitted his application on 21.03.2003 then the circular Mktg/CS/441/23 dated 24.04.2000 was in force, hence the Complainant was given the opportunity of revival of his lapsed policy and the OPs have, through revival quotation dated 17.07.2003 asked the Complainant to deposit DGH and policy bond alongwith Rs.5,843.00 but the Complainant did not give the policy bond to OP No.2 as such the policy could not be revived. Subsequently, the aforesaid circular was withdrawn on 08.12.2003. The Complainant deposited policy bond on 13.12.2004 without mentioning any reason and hence it was returned to him alongwith letter dated 13.12.2004 through registered post as the aforesaid circular was not in force at that time and hence the policy could not be revived. Since the policy had lapsed for more than the period of 5 years and as the Complainant had not performed his part for the revival, hence the OPs could not revive the policy, beyond the rules and regulations of the Corporation and terms and conditions of the policy. The OPs always performed its part and there is no deficiency on the part of the OPs. Since the LIC of India is a body corporate and may on its name sue and be sued, therefore there no suit or legal proceeding shall lie against any member or employee of the Corporation for anything done in the discharge of their duties, hence this complaint is not maintainable and is liable to be rejected with costs.

          The Complainant has filed objection to the WS of OPs with 4 annexures.

          The Complainant has filed his affidavit and 5 annexures with the complaint. The Complainant has also filed 20 papers.

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The Complainant has filed rejoinder affidavit. The Complainant has filed written arguments. The OPs have filed an affidavit of Sri Vidya Prakash, Manager (Legal), LIC with 7 annexures and 3 annexures with the WS.

          Heard Counsel for the parties and perused the entire record.

          Now, it is to be seen as to whether the Complainant took due steps for revival of his lapsed policy or not and whether the OPs have committed deficiency in service in not reviving the policy, if so its consequences.

          In this case, it is not disputed that the Complainant had taken a life insurance policy for a period of 20 years w.e.f. 28.04.1994. The only difference between the contention of the Complainant and that of the OPs in this regard is that the Complainant stated the assured amount to be Rs.50,000.00 whereas according to the OPs the assured amount was Rs.25,000.00 only and from the policy bond it is clear that the sum assured was Rs.25,000.00 and not Rs.50,000.00 as stated by the Complainant in his complaint. It is also clear from the para 21 of the complaint that the value of the policy of Rs.25,000.00. Thus, it is clear that the sum assured of policy is Rs.25,000.00. It is also not disputed that the Complainant had paid premium upto 1996 and from April 2004 he could not make the payment of the premiums and that his policy lapsed. It is also not disputed that the Complainant had applied for revival of the policy and that he was issued a revival quotation dated 23.04.2001 requiring the Complainant to make payment of Rs.2,949.00 alongwith DGH form. It is also not disputed that the Complainant deposited the amount of Rs.2,949.00 but dispute arose with regard to the submission of DGH form as according to the OPs the Complainant had not deposited the DGH form but according to the Complainant he had deposited the entire amount and that the policy was revived as is evident from the status report of the policy No.211275851  but as the

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Complainant did not receive any letter for revival of the policy, hence he again approached the OP No.2 with the application in writing that the premium for April 2001 and April 2002 could not be deposited for want of order for renewal of policy. But the Complainant again received a bill for Rs.5,843.00 for revival of policy whereupon the Complainant paid the said amount of Rs.5,843.00 on 24.07.2003. Thus, the demanded money was deposited in full upto the year of 2003, as is evident from annexure 4 and 5 the status of the policy issued by the OPs. Even though the OPs had charged Rs.643.00 in excess they did not pass the order for revival of the policy on depositing the demanded money and completing other formalities. But in this regard, the stand of the OPs is that there was a circular letter No.Mktg/CS/441/23 dated 24.04.2000 whereby the policy could be revived upto 5 years from the date of first unpaid premium and therefore the Complainant was issued revival quotation dated 17.07.2003 asking him to deposit the DGH form alongwith policy bond but the Complainant did not give the policy bond to OP No.2, hence the policy could not be revived and meanwhile on 08.12.2003 the aforesaid circular letter was withdrawn and as the policy bond was deposited by the Complainant on 13.12.2004, therefore policy could not be revived and the bond was returned to him alongwith letter dated 13.12.2004. So real cause, regarding the policy not being revived, is non submission of DGH form. Now, in this regard, we scrutinized the evidence produced by the Complainant and it transpires that the Complainant had deposited the DGH form as is evident from the endorsement made by the OPs on 24.07.2003 mentioning in the DGH form as “DGH in order. Revive at OT signed by HCA/AAO/AO.” Now this form was submitted on 21.03.2003 i.e. before the withdrawal of the notification on 08.12.2003. Therefore, there is no substance in the contention of the OPs that the DGH form was not submitted by the

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Complainant within time and when it was submitted then the notification had already lapsed. The Complainant has, apart from this document wherein it is shown that the document was submitted well within the validity of the aforesaid circular but he has also stated in his affidavit that he had earlier also submitted the documents but the OPs had not revived the policy. From the documents and evidence filed by the Complainant, it is clear that the Complainant had completed all the formalities and deposited not once but twice the due premium with interest on the demand of the OPs for the revival of the policy but on one pretext or the other the OPs did not revive the policy. Therefore, the OPs have certainly committed serious deficiency in service in not reviving the policy despite the Complainant fulfilling all the formalities. Learned Counsel for the OPs argued and cited the judgment ruling in Revision petition No.3155/12 Veena Rathore Vs LIC wherein the Hon’ble NCDRC has held that “revival of a policy cannot be claimed as a matter of right and will not automatically follow even after all policy conditions thereof are fulfilled.” But the facts of the case decided by the Hon’ble NCDRC are entirely different as in that case the policy holder had expired before the policy could be revived but in the instant case the policy holder is alive and the policy should have been revived as the Complainant had completed all the formalities and had deposited the money required for the purpose. The OPs have also cited the judgment pronounced by the Hon’ble NCDRC in first Appeal No.298/1994 Kamaluddin Ismailbhai Lakhani & Ors. Vs LIC wherein it is held that “revival of the policy must be done within 5 years from the date of first unpaid premium.” But the facts of this case are also not applicable in the facts of this case as in the case decided by the Hon’ble NCDRC the Complainant had not approached for revival of policy within 5 years from the date of last premium and therefore it was held by the Hon’ble NCDRC that LIC was not bound to renew the said policy but

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in the instant case the Complainant did apply within 5 years for the renewal of the policy, therefore, the aforesaid ruling is not applicable in this case and therefore it cannot be said that the policy of the Complainant cannot be revived. Thus, from the discussion made above, it is clear that the OPs have committed serious deficiency in service as the OPs did not revive the policy despite the Complainant completing all the formalities, therefore the Complainant is entitled to get the revival of the policy. But as the policy had already matured on 28.04.2014 and that the Complainant was not able to deposit the premiums due, therefore under the peculiar circumstances of the case the Complainant is entitled to get the amount deposited by him with interest from the date of last deposit from the OPs. From the record, it transpires that he had deposited Rs.13,553.00 as the amount of the premium with penalty etc., therefore he is entitled to get this amount refunded back to him with interest. As the Complainant has already been harassed in this case, we consider it appropriate to award compensation to the tune of Rs.10,000.00 and as the case is very old one, hence the Complainant is also entitled to the cost of the litigation.

ORDER

          The complaint is partly allowed. The OPs are jointly and severally directed to pay Rs.13,553.00 (Rupees Thirteen Thousand Five Hundred Fifty Three Only) with 9% per annum interest from the date of last deposit i.e. 24.07.2003 till the final payment is made to the Complainant.

          The OPs are also directed to pay Rs.10,000.00 (Rupees Ten Thousand Only) as compensation and Rs.4,000.00 (Rupees Four Thousand Only) as cost of the litigation. The compliance of the order is to be made within a month.

  (Rajarshi Shukla)          (Anju Awasthy)            (Vijai Varma)

         Member                          Member                 President

Dated:  24   September, 2015