J U D G E M E N T

In the matter of complaint petition filed by the complainant alleging deficiency in service by the opposite parties.

The factual matrix of the case is that :-

The complainant’s are the widow and daughter of  Late Baula Singh.  Baula Singh was working as a Revenue Inspector in different Revenue Circle under O.P. No. 3,4 & 5 who were his Drawing & Disbursing Authority.    Baula Singh was drawing his salary under O.P. No. 3,4 & 5 during his service period and he had insured his life with Life Insurance Corporation of India under Salary Saving Scheme as under:-

1. Policy No. 57037073, Type – S.S.S., Monthly Premium – Rs. 215/-, Sum Assured – Rs. 35,000/-, date of commencement – 28.03.1998 and date of Maturity – March, 2013.
2.  Policy No. 570307081, Type – S.S.S., Monthly Premium – Rs. 223/-, Sum Assured – Rs. 25,000/-, date of commencement – 28.03.1998 and date of Maturity – March, 2018.
3. Policy No. 590358661, Type – S.S.S., Monthly Premium – Rs. 105  /-, Sum Assured – Rs. 30,000/-, date of commencement – 20.06.1991 and date of Maturity – June, 2016.

As per the term and conditions of the said policies, the LIC of India had been collecting the adequate premium from the salary of the deceased insured which he was authorized and accordingly O.P. No. 3,4& 5 were remitting premium deducting the same from the salary of the insured to the BM, LIC of India, Nuapada Branch.The said insured died Pre-matured on 17.06.2012 leaving behind his widow (Complainant No. 1) and his minor daughter (Complainant No. 2) as sole legal heir and Successor –in-interest and got right to receive the insurance benefit out of the said three policies of deceased insured Baula Singh.During his life time, the insured got married to Santanubala Singh who died issueless and after her death the insured got married to Jayanti Singh (Complainant No. 1).Accordingly the insured had nominated his first wife Santanubala Singh to receive all the insurance benefit under the said policies in case of his pre-matured death but unfortunately the nominee Santanubala Singh has predeceased the insured.On application the complainant No. 1 claimed the insurance benefit before the B.M., LIC of India, Nuapada Branch (O.P. No.2),who issued a letter to the Tahasildar, Nuapada (O.P. No.3) on 12.08.2013 and served a copy of the same to the complainant No.1 for which he found that LIC of India has neglected to collect the premium from the salary of insured so also the O.P.No.3,4 & 5 (Drawing and Disbursing Officers of the insured) have not remitted the required monthly premium to the LIC of India at Nuapada Branch and on negligence of O.P.No.2 to 5 the insurance benefit of the three policies under Salary Savings Scheme of LIC of India have not been released to the complainants till date and the cause of action arose on 17.06.2012 on the death of insured and subsequently when the B.M., LIC of India of Nuapada Branch served a copy of letter issued to O.P. No. 3on 12.8.2013.The complainants have filed the documents in support of their claims:-

1. Copy of letter dated. 12.8.2013 issued by the  B.M. LIC of India, Nuapada to the complainant No.1 (Annexure-1).
2. Status report of Policy No. 570307081 as provided by B.M. LIC of Nuapada on 12.8.2013 (Annexure-2).
3. Status report of Policy No. 570307073 as provided by B.M. LIC of Nuapada on 12.8.2013 (Annexure-3).
4. Status report of Policy No. 590358661 as provided by B.M. LIC of Nuapada on 12.8.2013 (Annexure-4).
5. Attested Xerox copy of Death certificate of Baula Singh( Annexure-5)
6. Attested Xerox copy of Death certificate of Santanubala Singh( annexure-6)
7. Attested Xerox copy of legal heir certificate of late Baula Singh (Annexure-7)in support of their claim and  also they claim for  the relief’s as prayed for .

Being noticed, Advocate for O.P. No. 1 & 2 have filed a written version and admitted in Paragraph No.2 of the written version that Baula Singh had three numbers of policies under the Salary Savings Scheme (SSS) with the O.P. No. 1 & 2 bearing Policies No. 57037073 dated 28.03.1998 with monthly premium of Rs. 215/- matured in March, 2013, Policy No. 570307081, dated 28.03.1998 with monthly premium of Rs. 223/- matured in March, 2018 and Policy No. 590358661, dated. 20.6.1991 with monthly premium of Rs. 105/- matured in June, 2016 but they denied the rest of the contents of the complaint petition.Advocate for O.P. No.1 and 2 has filed two xerox copies of blank form i.e letter of authorisation as (Annexure-A) and letter addressed to O.P. No. 3 on 12.8.2013 as ( Annexure-B)and 20.5.2014 ( Annexure- C)without any acknowledgment or any postal receipt.

The O.P. No. 3 has filed a written statement and stated that no information /intimation regarding non-receipt of premium for any of the defaulting period has been received from the LIC of India, Nuapada Branch by this office.Further he has stated that there is no fault in respect of O.P. No.3as all the monthly premiums have been deducted by the O.P. No.3 and remitted to the appropriate authority for the months during which the salary of the deceased has been drawn prior to his death.Further he has stated that the Drawing Officer prepares the salary bills and deducted the premiums from the salaries due of the policy -holder and sendthe Bills along with the LIC Schedules to the treasury and as such he is exonerate in this case.O.P. No. 3 has not filed any documents in this case.

After received the notice, O.P. No.4 has not appeared in this case so he set ex-parte.

O.P. No. 5 has filed a written statement and stated that Baula Singh was working in Komna Tahasil as Revenue Inspector for the period from 01.09.2010 to 18.12.2010 and as per the procedure consequent upon joining of late Baula Singh at Komna, Thasildar Nuapada (O.P. No. 3) had submitted his Last Pay Certificate (LPC) and according to the Last Pay Certificate his LIC Premium has been deducted from the salary bill for the period of his incumbency at Komna Tahasil i.e. from 01.9.2010 to 18.12.2010 and as such there is no negligence and deficiency on the part of the O.P. No. 5.O.P. No. 5 filed a Xerox copy of LPC of Baula Singh in this case.

Government Pleader has appeared on behalf of O.P. No. 6 but he has not filed any written version in this case.

In the above pleadings, the following issues are framed and considered :-

1. Whether the complaint is maintainable in the eye of law  ?
2. Whether the complainants are  consumer or not  ?
3. Whether the Forum has jurisdiction to adjudicate upon and there is cause of action  ?
4. Whether any negligence and deficiency in service on the part of the opposite parties ?
5. To what relief, the complainants  are entitled to  ?

ISSUE No. I to IV.

Since, the issues are very much linked up with each other, those are taken up for jointly discussion and findings.

On the first stage, the question of status of consumer should be cleared.  In the present case, the complainants are consumer of opposite party No. 1 and 2.  On perusal of case record, it is found that the complainant No.1 is the widow and complainant No. 2 is the daughter of late Baula Singh.  Baula Singh  was working as Revenue Inspector in different Revenue Circle under O.P. No. 3 to 6.  O.P. No. 3, 4 & 5 were Drawing and Disbursing Authority of late Baula Singh.  Baula Singh was drawing his salary under O.P. No. 3, 4 & 5  and  during his service period he had insured his life with LIC of India under Salary Saving Scheme in three policies i.e. Policy  No.57037073,   Policy No. 570307081 and Policy No. 590358661 and as per the term and condition of the said policies, the LIC of India had been collecting the premium from the salary of the deceased insured which he authorized and accordingly O.P. No. 3, 4 & 5 were remitting the premium after  deduction from the salary of the insured to the B.M. LIC of India, Nuapada Branch (O.P. No.2). But the said insured died  pre- matured on 17.6.2012 leaving behind his widow  (Complainant No. 1) and his minor daughter (Complainant No. 2) as sole legal heirs and successor-in-interest and got right to receive the insurance benefit out of the said three policies of deceased insured Baula Singh.

During the life time of Baula Singh, he had married to Santanubala Singh who died issueless and after her death insured  got married to Jayanti Singh (Complainant No. 1).

Further it is seen that, the insured had nominated  his first wife named  Santanubala   Singh  in    the  above  said  three  policies  but unfortunately the nominee Santanubala has predeceased the insured.  After the death of insured, the complainant No. 1 claimed with an application for insurance benefit of the said three policies before the B.M., LIC of India, Nuapada Branch (O.P. No. 2) and basing on that O.P. No. 2 simply issued a letter to O.P. No. 3 on 12.8.2013 and served a copy of the same to the complainant No. 1 which is just to shift their burden and to avoid the future complicacy and still it is unsettled by the O.P. No. 1 & 2 which is squarely absurd by them.

In such an uncongenial situation and without any option, the complainant knocked the door of this Forum.

As per the Consumer Protection Act, 1986 Section 2 (d)(ii) explain consumer means any person “who hires or avails of any services for a consideration which has been paid or promised or partly promised or any system of deferred payment and includes any beneficiary of such services other than commercial purpose’  so the status of consumer cannot be deniable and thereby the maintainability.

So far as the point of jurisdiction, it is seen that the complainants are resident of village  Boden , P.S. Boden ,District Nuapada and Branch Office of OP No.1 & 2  is situated in  this district so the complaint is within the jurisdiction of the Forum and this Forum has wide jurisdiction to adjudicate the present dispute and there is cause of action.

In written version, Advocate for O.P. No. 1 & 2 has stated and taken plea that due to irregularity in remitting of the premium by the authorities of the Life Assured the  death claims could not be settled and also further stated that as per the “Letter of Authorisation”  the policy holder becomes  entirely responsible for any consequences   on account   of non payment of premium on his Policy.

In another factual aspect  is that the premiums of employee (Life Assured) have been deducted by the O.P. No. 3 & 5 and remitted to the appropriate authority for the months during which the salary of the deceased has been drawn prior to his death and as such they have no fault on it.

Further it is seen that, O.P. No. 3 to 6 are not liable under the Act as it was not rendering any service as the services was free of charge as per the definition of “Services” as contained  in section  2(1)(o) of the Act .

 Supporting to it we quote a decision of Hon’ble Supreme Court of India in State of Orissa   vrs.  Divisional Manager, LIC of India, 1996 (87) CC 881 and 1996 (8) SCC-655.

In another point is that, it is not the case of the Life Insurance Corporation that O.P. No. 3 to 6 could be permitted as an  insurance agent within  the   meaning of   the Insurance Act  and  Regulations.  O.P. No. 3 to 6 are not procuring or soliciting any business for the Life Insurance Corporation.  The mode of collection of premium has been indicated in the scheme itself and employer has been assigned the role of collecting premium and remitting the same to the Life Insurance Corporation.  It is a matter of common knowledge that Insurance Companies employ agent and when there is no insurance agent as defined in the regulations and the insurance Act, the general principles of the law of agency contained in the contract Act are to be applied.

In another vital point is that if the premium from November 2010 to February 2012 were not remitting  by  O.P. No. 3 to 6 to the LIC (O.P. No. 1 & 2) so without any delay it was the duty of O.P. No. 1 & 2 to immediate intimate the same to O.P. No. 3 to 6 as well as to the employee (Life Assured) as the employee (Life Assured) was alive  and he could able  to pay the dues at that time but it invain and lastly he died on 17.06.2012.

But here, O.P. No. 1 & 2 have failed to intimate and did not take any steps to collect the above premium dues and they remained silent from 01.12.2010 to 11.8.2013 i.e. 2 years 8 months and 10 days and also there is no such any documents from the side of O.P. No. 1 & 2 as they intimated the same within the period i.e. 01.12.10 to 11.8.2013.

So, the plea of O.P. No. 1 & 2 is unbelievable and it is evasive due to want of the documents.

Further it is seen that in  the event of the Salary Saving Scheme if there is no remittance of the premium by the employer, the corporation shall intimate the fact to the life assured.  The purposive interpretation has to be given to the endorsement and it has to be held that since payment of premium after deducting from the salary of the employee is between the O.P. No. 3 to 5 and the Life Insurance Corporation, it will not be for the employee to intimate the Life Insurance Corporation  about non-remittance of the premium as there is no scope for him to know about it.

Considering the scheme, such a condition cannot be imposed on an employee.  It is impracticable.

Supporting to the above facts, we  quote a decision of Hon’ble Supreme Court of India in Harshad Shah . .Vrs. . . Life Insurance Corporation of India, 1997 (89)CC1091997) (5)SCC64.

In another factual aspect is that in an insurance policy taken under the “Salary Savings Scheme (SSS) of the Life Insurance Corporation, the LIC is bound to inform the employee on prescribed forms No. 5227 & 5228 in case of non-payment of premium for any reason as laid down in their manual for policy servicing department No. 14-Salary Savings Scheme, issued on 31.12.1990.

The above view is further strengthened after reading of section 50 of the Insurance Act, 1938, which states as under :-

“Section – 50 :- An insurer shall, before the expiry of three months from the date on which the premiums in respect of a policy of Life Insurance were payable but not paid, give notice to the policy- holder informing him of the options available to him unless these are set forth in the policy”.

Supporting to the above facts, again we quote an another  decision of Hon’ble National Consumer Disputes Redressal Commission in case of Meenakshi Popat Kumbhoje and others . . Vrs . .. Life Insurance Corporation of India on 11.03.2015.

In another vital point is that Advocate for O.P. No. 1 & 2 has filed a xerox copy of blank form i.e. Letter of Authorisation    ( Annexure –A) as well as a xerox copy of letter dated  12.08.2013(Annexure-B) and a xerox copy of letter dated 20.05.2014(Annexure-C) without any acknowledgments and any attestation  on it so it has no    evidenciary  value and as such the documents are not taken in consideration.

Further it is seen that O.P. No. 5 has filed a Xerox copy of L.P.C. without any attestation so it has no evidenciary value and as such not taken in consideration.

Supporting to the all above findings, we again quote an another most vital decision of Hon’ble Supreme Court of India in “Delhi Electric Supply Undertaking ..Vrs.. Basanti Devi and another in Civil Appeal No. 6113 of 1995, decided on 28.9.1999 and stating that “When an employer collects premium on behalf of Life Insurance Corporation, under the Salary Saving Scheme, he becames an authorised agent to do so and for his ommissions, as principal, Life Insurance Corporation will be liable.  Even in case of non receipt of the premium from the employer after due deduction from the employee, Life Insurance Corporation shall be bound to honour the claim of the insured employee.”

In another factual aspect is that the insurance contract of utmost good faith and the insured person takes the insurance policy by keeping faith on the company.  But, his hopes and dreams shattered by the attitude of insurer when the issue of claim arises.  The Insurance Company find several ways how to repudiate the claim even it is genuine one and  harass the  claimant and make him to run from pillar to post.  It is just unfair and unacceptable.

Here, the Consumer Protection Act is  social legislation and there is need to strike down such practices and need to give proper redressal to the consumers.

In fact, the Insurance Company should be magnanimous enough generous to award the claims at single window, without any hassle and with full co-operation.

So, from the perusal of the provisions of Consumer Protection Act, 1986 applied to all type of goods, and all type of services availed by the consumer against consideration paid, or promised.  Section 1 (iv) of the Consumer Protection Act, 1986 is of wide connotation.

Perused the documents of the complainants, we found that the claim of complainants is genuine and relevant and as such taken in consideration.

Further it is seen that, there is no any negligence or deficiency in service from the side of O.P. No. 3 to 6 and as such they are not liable in this case.

In this case, the advocates for the parties have argued in support of their claim.The advocate for OP No.1& 2 has filed citation (2000) NCJ (NC) 200, R.P.No.891of 96 dt.2.9.99 which is not applicable in this case.

Here, we assessed that the complainants are consumers of O.P. No. 1 & 2 and it is the duty of O.P. No. 1 & 2 to provide proper service and proper information to the complainants.  But O.P. No. 1 & 2 have failed to do the same in this case.

          Hence, it is apparent from the above issues that there is a deficiency of service by the O.P. No. 1 & 2 as not properly intimate and provide proper service to the complainants for which the complainants are suffering financial loss and mental agony due to negligence and deficiency of service by the O.P. No. 1 & 2.

So, we are of considered opinion that there is a deficiency in service by the O.P. No. 1 & 2.  Thus, O.P. No. 1 & 2 are liable for deficiency in service.

ISSUE No. V.

It is clear crystal that the complainants have proved their case and they are entitled to get relief in this case.  Hence, order.

O R D E R.

In the aforesaid matrix of facts and circumstances, the complaint is allowed and we direct U/s 14 (i)(d) of the Consumer Protection Act, 1986 as below :-

1. We direct the O.P. No. 1 & 2 to pay the entire insurance benefit of the three policies i.e. Policy No. 57037073, Policy No. 570307081 and Policy No. 590358661 to the complainants alongwith interest @ 9% (Nine percent) per annum from 17.06.2012 i.e. the death of insured till payment within 45 (forty five) days from the date of order.
2. We further direct the O.P. No. 1 & 2 to pay Rs.10,000.00 (Ten thousand) to the complainants as compensation towards financial loss and mental agony and to further pay Rs.5,000.00 ( Five thousand) towards litigation cost within 45 (forty five) days from the date of order.
3. Failing which, the above order, the complainants are at liberty to take steps as per process of law.

Judgment pronounced in the Open Court of the District Consumer Disputes Redressal Forum, Nuapada, this the 17^th day of July2018.