0. DISTRICT CONSUMER DISPUTES REDRESSAL FORUM,<br /> BATHINDA(PUNJAB)<br /> <br /> <br /> C.C.No.09 of 09.01.2007<br /> Decided on : 24.04.2007 <br /> <br /> Archna Jindal W/o Bhushan Jindal, R/o M/s. J.B. Jindal & Co., Commission Agent, Bhucho Mandi, District Bathinda.<br /> ...... Complainant<br /> <br /> Versus. <br /> <br /> 1.Life Insurance Corporation of India, Bibi Wala Road, Bathinda through its Senior Branch Manager.<br /> 2.Life Insurance Corporation of India, Dugri Road, Ludhiana through its Divisional Manager.<br /> 3. Life Insurance Corporation of India, Northern Zonal Office, Jeevan Bharti, 124, Connaught Circus, New Delhi-110001 through its Zonal Manager.<br /> 4.Life Insurance Corporation of India, Yogakshema, Jeevan Bima Marg, P.O. Box No. 19953, Mumbai-400021 through its Chairman.<br /> ...... Opposite parties<br /> <br /> Complaints under section 12 of the Consumer Protection Act, 1986<br /> <br /> QUORUM:<br /> <br /> Sh.Lakhbir Singh, President<br /> Sh.Hira Lal Kumar, Member<br /> Dr.Phulinder Preet, Member<br /> <br /> For the complainant : Sh. Naresh Garg, Advocate<br /> For the opposite parties : Sh. Sanjay Goyal, Advocate <br /> <br /> O R D E R.<br /> <br /> LAKHBIR SINGH, PRESIDENT:-<br /> 1. Complainant's case is that he had purchased one Jeevan Sneha Insurance Policy No.161447078 under table 128 for a sum of Rs. 3,00,000/- from the opposite parties. It commenced from 28.4.2001 for a period of twenty years. Yearly premium is being deposited in advance by her as per terms and conditions of the policy. As per circular of the opposite parties at the time of issuing the policy, she had deposited the premium one year in advance in which they gave her rebate of 10% on advance instalment. At the time of issuing the policy, opposite parties had undertaken to pay interest @ 11% compounded yearly on the survival benefit as per clause 1 (Special benefits) as per circulars of Jeevan Sneha. She had already given option by writing letter dated 26.10.2005 to opposite party for investment of the survival benefit with the request that interest be allowed to her @ 11% P.A. compounded yearly which would be payable at the time of maturity. Divisional Office of opposite party No.1 clarified at the time when the policy was purchased that it (policy) is just like money back policy and policy holder can opt at the time of encashment of the survival benefit (Here-in-after referred to as 'SB') i.e. after every five years that it be allowed to remain with the corporation @ 11% P.A. compounded yearly . Official had given the clarification by way of preparing chart under table 128 for 20 years. Decision was also conveyed in this regard orally. Opposite party No.1 issued letter dated 25.7.2006 reducing the rate of interest from 11% compounded to 8%. He assails this letter as illegal, null and void, arbitrary, against principles of natural justice and terms and conditions of the Jeevan Sneha Insurance Policy. She alleges that act and conduct of the opposite parties has caused her mental agony, pains and sufferings. In these circumstances, complaint under section 12 of the Consumer Protection Act has been preferred by her seeking direction from this Forum to opposite party No.1 to declare letter dated 25.7.2006 as illegal, null and void & against the principles of natural justice; direct it to continue the policy with original terms and conditions according to the circular at the time of its purchase; pay Rs. 20,000/- as compensation for mental agony and pains, besides costs of the complaint to the tune of Rs.5,000/-.<br /> 2. In pursuance of the notice of the complaint issued by this Forum to the opposite parties, they filed reply taking legal objections that complainant has no cause of action or locus-standi to file it; she has not approached this Form with clean hands; she is not consumer; complaint is not maintainable and entertainable by this Forum as it is beyond the ambit and scope of its jurisdiction; complaint is false and frivolous; it requires extrinsic oral and voluminous documentary evidence which cannot be taken by this Forum; complainant is estopped by her act and conduct from filing the complaint & there is no alleged term in the policy for payment of alleged interest @ 11% per annum. On merits, they admit that policy was issued in favour of the complainant and she is paying yearly premium as per terms and conditions of the policy. They deny that there is any circular to pay interest @ 11% to be compounded yearly on survival benefit. As per terms and conditions of the policy, person having title to it has to give an option to receive the survival benefit at any time after due date. If he/she opts to avail it later, increased survival benefit becomes payable which is to be decided by the Corporation from time to time. There is no specific increase in survival benefit. Rather, the same is as per the circular of the Corporation at the time when option for it is given by the concerned consumer. They further add that there is no particular agreement between them and the complainant for payment of interest @ 11% P.A to be compounded annually. Interest rate keeps changing from time to time. Even letter dated 25.7.2006 reveals that they had sought the option regarding interest @ 8% P.A and not @ 11% P.A. They repudiate that extra premium is being charged. Similarly, they deny that letter dated 25.7.2006 is illegal, null and void, arbitrary, against principles of natural justice and terms and conditions of the policy. Other averments in the complaint stand denied.<br /> 3. In support of her allegations and averments in the complaint, Archna Jindal complainant tendered into evidence her own affidavit (Ex.C.1), photocopy of policy (Ex.C.2), photocopy of Pamphlet of Jeevan Sneha (Ex.C.3) & photocopies of letters dated 25.7.2006 & 26.10.2005 Ex.C.4 & Ex.C.5 respectively.. <br /> 4. On behalf of the opposite parties, reliance has been placed on affidavit (Ex.R.1) of Sh. Shanti Lal Yadav, Manager Legal &HPF & photocopy of letter dated 12.1.2002.<br /> 5. We have heard the learned counsel for the parties and have gone through the record. Apart from this, we have considered written arguments submitted by the parties.<br /> 6. Mr. Garg learned counsel for the complainant vehementally argued that copy of the features of the policy purchased by the complainant is Ex.C.3. According to it, if the policy holder opts to avail survival benefit later after its due date, increased survival benefit is payable with interest @ 11% compounded annually. Opposite parties by way of issuing impugned letter dated 25.7.2006, copy of which is Ex.C.4, cannot change the rate of interest on the retained survival benefit from 11% to 8% and as such, this letter is illegal, arbitrary, null and void and against the terms and conditions of the policy. <br /> 7. Learned counsel for the opposite parties urged that opposite parties can change the rate of interest on retained survival benefit from time to time as per condition in the copy of the insurance policy Ex.C.2. They changed the rate of interest vide decision dated 12.1.2002, copy of which is Ex.R.2, according to which rate of interest was revised from 11% to 8% P.A. to be compounded yearly. There is no deficiency in service in this case as matter regarding service under the insurance policy can arise only on the maturity of the policy or the death of the assured.<br /> 8. We have considered the respective arguments. Some facts are not in dispute in this case. They are that complainant had purchased Jeevan Sneha Insurance Policy, copy of which is Ex.C.2. This policy commenced from 28.04.2001 for twenty years. Her survival benefit payment was due on 28.4.2006. She gave option to the opposite parties by way of writing letter, copy of which is Ex.C.5. On 25.7.2006, opposite parties sent impugned letter to the complainant intimating that S.B. was due to her in April, 2006 and if she wanted to reinvest the same, she would get interest at the rate of 8% P.A.<br /> 9. Copy of the terms and conditions regarding the features of the policy Jeevan Sneha is Ex.C.3. One of the special benefits is as under:-<br /> “1. Encashment of Survival Benefit as and when needed: The policy holder at her option may avail the survival benefit any time on or after its due date. If opted to avail later, increased survival benefit (increment @ 11% compounded yearly) will be payable.”<br /> 10. Some terms and conditions have been recorded as special provisions in the policy itself, copy of which is Ex.C.2. Relevant special provision/term and condition No.3 reads as under:-<br /> “3. The person having title to the policy shall have an option to receive the survival benefit mentioned in the schedule at any time after the date on which it falls due. In such an event increased Survival Benefit shall become payable. The increase in the survival benefit shall be decided by the Corporation from time to time.”<br /> 11. In our view, features of the plan Jeevan Sneha Insurance Policy and the special provisions in the policy itself are to be read together. They cannot be considered in isolation. When they are so interpreted, the policy holder has an option to receive the survival benefit at any time on or after its due date. If she offers to avail it later, increased survival benefit would be payable with interest @ 11% compounded yearly, but opposite Corporation is at liberty to decide the increase in the survival benefit from time to time. In other words, it can take decision about the variation in the rate of interest. It being so, the contention of the learned counsel for the complainant that opposite parties cannot change the rate of interest i.e. 11% to be compounded yearly as mentioned in the features of the policy, cannot be accepted as the joint reading of special benefits and the special provisions given in the policy does not lead to this conclusion.<br /> 12. Now question arises as to whether there is any deficiency in service on the part of the opposite parties. Opposite parties took the decision on 12.1.2002 to revise the rate of interest from 11% compounded yearly to 8% in case of deferment of the survival benefit. On its basis, opposite parties have issued impugned letter dated 25.7.2006 to the complainant conveying that rate of interest would be 8% on survival benefit due to her in April, 2006, if she wanted to reinvest the same. Due date for availing the survival benefit was 28.4.2006. Before 25.7.2006, opposite parties did not convey her the variation in the rate of interest from 11% to 8% to be compounded yearly, although complainant had opted well in advance i.e. on 26.10.2005 for reinvestment of survival benefit at the rate of interest of 11%. Copy of her letter is Ex.C.5. From 26.10.2005 till 25.7.2006, opposite parties kept mum and did not deem it fit to convey the decision regarding the rate of interest as 8% before the due date i.e. 28.4.2006. Had the opposite parties conveyed the decision dated 12.1.2002, copy of which is Ex.R.2, to the complainant, she could have invested amount of her survival benefits with some other agency giving more interest than 8%. There is nothing on the record that opposite parties ever conveyed the decision dated 12.1.2002 to the complainant through any mode before the issuance of impugned letter dated 25.7.2006. If opposite parties were to change the contractual obligation, they were required to intimate the change in the rate of interest which has not been done in this case till 25.7.2006. In the facts and circumstances, we hold deficiency in service on the part of the opposite parties in not conveying the modification in the rate of interest till 25.7.2006.<br /> 13. Another question for determination is as to which relief should be accorded to the complainant in the given situation. As discussed above, direction deserves to be given to the opposite parties to pay interest @ 11% to be compounded yearly on the survival benefit which became due to the complainant on 28.4.2006 regarding her policy till 25.7.2006 as letter of this date is not binding upon her and it is against the principles of natural justice to this extent. Complainant is craving for compensation of Rs.20,000/-for mental agony and pains. In our view, she is not entitled to any compensation in the facts and circumstances of this case and in view of the relief which is being accorded, as above.<br /> 14. No other point was urged before us at the time of arguments.<br /> 15. In the result, complaint is partly allowed against the opposite parties with costs of Rs.1,000/-. Opposite parties are directed to do as under:-<br /> ( i ) To allow interest @ 11% to be compounded annually to the complainant on the amount of her survival benefit due on 28.4.2006 regarding her Jeevan Sneha Policy No.161447078 under table 128 till 25.7.2006 as letter of this date is not binding upon her and it is against the principles of natural justice to this extent.<br /> ( ii ) Compliance within 30 days from the date of receipt of copy of this order, failing which the amount of interest payable to the complainant would carry interest @ 8% P.A. to be compounded annually till payment.<br /> 16. Copy of this order be sent to the parties concerned free of<br /> <br /> <br /> cost. File be also consigned.<br /> <br /> Pronounced (Lakhbir Singh)<br /> 24.04.2007 President<br /> <br /> (Hira Lal Kumar)<br /> Member<br /> <br /> (Dr.Phulinder Preet)<br /> Member <br /> <br /> 'bsg'