Haryana

Ambala

CC/14/2014

MAMTA JINDAL - Complainant(s)

Versus

LIC OF INDIA - Opp.Party(s)

K.C JAIN

22 Aug 2017

ORDER

BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM AMBALA

 

                                                          Complaint case no.        : 14 of 2014

                                                          Date of Institution         : 06.01.2014                                                                                      Date of                                                                                       decision   : 22.08.2017

 

Mamta Jindal W/o Sh. Satish Kumar Jindal S/o late Sh. Shyam Lal Jindal, presently resident of H.NO.521, first floor, Sector-7, Urban Estate, Ambala City.

 

 

……. Complainant.

 

LIC of India through its:-

1.       Branch Manager, LIC of India, near head Post Office, Ambala City.

2.       The Manager (Health Insurance), O/o The Sr. Div. Manager, LIC of India,         Div. Office Model Town, Karnal.

 

….…. Respondents.

 

BEFORE:   SH. D.N. ARORA, PRESIDENT

                   SH. PUSHPENDER KUMAR, MEMBER         

                   MS. ANAMIKA GUPTA, MEMBER                 

 

Present:       Sh. K.C. Jain, counsel for complainant.

                   Sh. R.K. Jindal, counsel for Ops.

 

ORDER:

                   In nutshell, brief facts of the present complaint is that the complainant purchased an insurance policy bearing No.175075380 from OP No.1 on dated 211.11.2006 with yearly payment of Rs.45,000/- and the complainant had paid the subsequently yearly payment of Rs.45,000/- each on dt. 26.11.2007 and dt. 24.11.2008. Further submitted that premiums were not paid as the OP failed to inform the complainant about the number of units allotted on each payment made to the OPs, inspite of the fact that the OPs had been informing vide each payment received that “Units allotted will be intimated separately”. On 25.09.2012, the complainant applied for the surrender value of the policy in question and the OPs paid to the complainant the surrender value amounting to Rs.1,54,215/- through NEFT on 27.09.2012 and the complainant accepted the said remitted surrender value of the policy under protest as it was found to be much less than the fund value but was due that payable to the complainant and the OPs were duly informed about the same vide registered AD/legal notice dt. 09.10.2012. Further submitted that in reply to the above said notice, the OPs vide its reply dt. 20.10.2012 tried to justify the said payment of the surrender value of the policy being correct and accurate citing. “The policy was foreclosed on 21.11.2011 because as per the policy conditions, if the policy is not revived within the revival period i.e. within 2 years from the due date of first unpaid period premium, the policy is compulsorily surrendered”. It can clearly be derived that the complainant is entitled to the fund value/surrender value of the policy on the date of its surrender. As reported, the NAV of the units under the policy in question on 25.09.2012 was Rs.15.3259 per unit and the number of the units at the credit of the policy at that point of time was 11411.180; and as such the fund value/surrender value of the policy as on 25.09.2012 comes to Rs.1,74,887/- which is due and payable to the complainant/policy holder, where as the OP had paid only sum of Rs.1,54,215/- and a sum of Rs.20,672/- is still due from the OP under the policy in question. Hence the present complaint.

2.                Upon notice, OPs appeared and filed written statement submitting that the complainant has taken insurance policy number 175075380 Ulip Plan from OP No.1 on 21.11.2006 with the yearly payment of premium of Rs.45,000/-, as per the terms and condition of the policy in question if the policy holder failed to got the policy revived within 2 years from the due date of first unpaid premium, in that event the insurance policy is compulsorily surrendered, in the present policy in question the policy holder paid the premium only up to 21.11.2008, and the first unpaid premium was due on 21.11.2009 thereafter he neither paid the premium nor the policy was revived. As such as per the terms and conditions of the policy, the policy in question was compulsory surrendered on 21.11.2011 i.e. 2 years after the first unpaid premium i.e. 21.11.2009. It has been further submitted that the policy in question was purchased to gain the profit and loss, therefore, present complaint is not maintainable. The respondents have paid the surrender value of the policy in question i.e. Rs.154215 on 27.09.2012, for which the complainant has applied only on 25.09.2012, as such nothing is due towards the OP of the complainant and there is no deficiency in service on the part of the OP. So, OPs has prayed for dismissal of the present complaint.

3                 To prove his version complainant has tendered affidavits as Annexure C-X alongwith with documents as Annexure C-1 to annexure C-6 and closed his evidence. On the other hand, counsel for OP has also tendered affidavit as Annexure R-X alongwith documents Annexure R-1 & Annexure R-2 and closed his evidence

4.                We have heard learned counsel for the parties and carefully gone through the case file.

5.                Learned counsel for the OPs in preliminary objections has taken a specific plea that the present policy was purchased to gain profit and further argued that the policy in question is a Unit Linked policy and depends on market volatility and the policy was taken for investment of the premium amount in the share market which is for speculative gain because the money was invested for commercial purposes, therefore, the present complaint is not maintainable as per Section 2 (1) (d) of The Consumer Protection Act, 1986. In support of his arguments he has placed reliance of case law titled as Ram Lal Aggarwalla Vs. Bajaj Allianz Life Insurance Company Limited decided by Hon’ble National Commission on 23.04.2013 in Revision Petition No.658 of 2012.

6.                After going through the terms and conditions of the policy which has been placed on the file as Annexure R1, it is ample clear that it is a risk cover policy and it is not a commercial one because this policy covers the death of the policy holder despite the fact that it is a Unit Linked Policy (Market Plus). Relevant term and condition is as under:

9 (1) (a)  In case of death life cover sum assured plus fund value of the units held in the policy holder’s Unit account of life cover as opted for. If life cover is not opted for then only Fund Value of the Unit held in the Policy holder’s Unit account is payable.

(b)In case of death due to accident: Accident benefit sum assured in addition to the amount under A above. Accident benefit is opted for.

 The plea taken by the OPs that the investment was made by the complainant for gain profit being commercial investment is not sustainable and the investment made by the complainant cannot be termed as speculative in nature. The case law relied upon by learned counsel for the OPs titled as Ram Lal Aggarwalla Vs. Bajaj Allianz Life Insurance Company Limited decided by Hon’ble National Commission on 23.04.2013 in Revision Petition No.658 of 2012 (supra) is not applicable to the case in hand.

7.                Counsel for complainant has argued that the complainant had purchased an insurance policy bearing No.175075380 from No.1 on 21.11.2006 with yearly payment of Rs.45,000/- and paid yearly payment of Rs.45,000/- each on dt. 26.11.2007 and 24.11.2008 as is evident from Annexure C-1 to Annexure C-3 (premium receipts) but the Ops did not intimate him about allotments of units on each payment. Further argued that the Ops paid the surrender value, applied by the complainant, to the tune of Rs. 1,54,215/- which was accepted by the complainant under protest.  Further argued that due to non-payment of the premium qua the policy in question, the policy was fore-closed on 21.11.2011 after expiring the two years period for revival of the policy without giving any notice to the complainant which is wrong and against the principle of natural justice. In support of his contentions, counsel for the complainant has relied upon the case titled as M/s ICICI Prudential Life Insurance Co. Ltd. Vs. Abhay Rishi Col (Retd) 2015(3) CLT Page 80 (N.C).

                   Per contra, it has been argued that policy in question was compulsory surrendered on 21.11.2011 due to non-payment of yearly premium i.e. 2 years after first unpaid premium which was due on 21.11.2009. The surrender value of the policy to the tune of Rs.1,54,215/- in question has already been paid to the complainant on 27.09.2012 within two days as the complainant had applied for the same on 25.09.2012.

8                 After hearing both the counsels and gone through the case file, it is clear that the policy of the complainant was foreclosed on 21.11.2011 by the OPs due to non-payment of premium and even the policy was not renewed within stipulated period of two years. This Forum has noticed that the Ops kept the surrender value of the policy in question with them for almost 10 months despite foreclosing of the policy on 21.11.2011.  There is nothing on the case file to show that the OPs had ever issued any notice to the complainant regarding foreclosing the policy in question. It is a settled principle of law that he who seeks equity must do equity with others. In the present case the Ops had foreclosed the policy in question at its own, therefore, it was their duty to pay the surrender value to the complainant immediately after foreclosing the policy in question but the OPs did not do the same and there is no explanation as to why they waited for the complainant to apply for payment of surrender value. The complainant got served legal notice Annexure C-4 upon the OPs which was duly replied by them. Perusal of reply reveals that instead of acting fairly the OPs are trying to avoid their liability because they had neither served/intimated to the complainant about foreclosure of the policy nor paid the actual surrender value of the policy in question. In the reply in para No.1 of the reply on merit the OPs have mentioned that information qua number of units was given to the complainant by their ULIP department at Karnal (Annexure R-2) but there is nothing on the file to show by which mode the complainant was intimated about the number of units of the policy in question. For the sake of the arguments if it is presumed that the complainant had to file claim in case of forfeiture even then it was duty of the OPs to send the claim form immediately to the complainant after forfeiture of the policy asking to the complainant to file the claim. From the facts proved on the file, it reveals that no course has been adopted by the OPs. Resultantly, we hold that OPs had illegally withhold the amount which is to be paid to the complainant after 21.11.2011 as the OPs have used the amount of the complainant for their personal gain since 2011. So, it would be appropriate if the complainant is given rate of interest on FDR which was 9.5% per annum with quarterly rests. Had the said payment was made at that time then complainant would have easily earn said interest by making the fixed deposit of the amount in the nationalized bank or even LIC Housing Finance which is a subsidiary of the OP. To do justice, we hereby direct the OPs to pay the interest on Rs.1,54,215 @ 9.5% per annum with quarterly rests from the date of foreclosure of the policy i.e. 21.11.2011 till 27.09.2012 (when the payment was made). Hence, the present complaint is hereby partly allowed alongwith costs which is assessed at Rs.5000/-. Order be complied within thirty days from the date of receiving of copy of this order. Copies of the order be sent to the parties concerned, free of costs, as per rules. File after due compliance be consigned to record room.

Announced on :22.08.2017                                  (D.N. ARORA)

                                                                                       President

 

    (PUSHPENDER KUMAR)

                                                                                       Member

 

          (ANAMIKA GUPTA )

                                                                                       Member