Order by:

Sh.Amrinder Singh Sidhu, President

1.       The complainant  has filed the instant complaint under section 12 of  the Consumer Protection Act, 1986 (now under section 35 of the Consumer Protection Act, 2019)  on the allegations that he is having bank account with Opposite Party No.3-Bank and in the first week of March, 2013, the complainant visited the Opposite Party No.3 bank for some transaction. At that time, one agent of Opposite Parties No.1 and 2 contacted him and allured to purchase their some policy and told that there is best offer for policy purchasers and on the investment in the shape of policy, the complainant could get 18% per annum interest  and not only this, after two years, the complainant can get the money back alongwith interest and at that time, the agent of Opposite Parties No.1 and 2 got signature of the complainant on blank papers and also got signed the bank withdrawal voucher to transfer the money from the bank account being maintained with Opposite Party No.3 bank and told the complainant that he could collect the receipt of premium after 15 days from the bank and the original policy will he handed over to the complainant after 1 to 2 months. But despite various requests and reminders, to the agent of Opposite Parties No.1 and 2, the original policy has not been provided to the complainant. However, the complainant was regularly paying the premium of policy by showing the premium paid slip issued by them. After 4 years, the complainant approached the Opposite Party No.3 bank as he was  urgent need of money and at that time, the complainant had  deposited Rs.1,76,293/- as premium amount, but the officials of Opposite Party No.3 told that the complainant will get only Rs.68,000/- on liquidation. The complainant came to know that the bank is the authorized agent of Opposite Parties No.1 and 2 and selling the policies to their innocent, illiterate customers by enumerating false schemes, benefits in collusion and in connivance with Opposite Parties No.1 and 2 by making false promises. At that time, the officials of Opposite Party No.3 told that the said policy is for 6 years and after 6 years, he will get 100% of the amount paid alongwith onus and asked to continue the policy, then after  2 days of making request by Opposite Party No.2, the complainant received a message on his mobile phone that “Max life offers late fee waiver to revive  your policy 882191117. Pay Rs.125724 to revive and save Rs.20041. This is applicable for limited period (28 Feb-2019)”.  On assurance and taking belief of officials of Opposite Party No.2, the complainant deposited a sum of Rs.125724/- on 27.02.2019 for total premium of policy. After one month, the complainant approached the office of Opposite Party No.2 and after showing the premium paid slip wants to liquidate the policy and after inspection of the policy, he said that he will get only Rs.1 lakh on liquidation of the policy as this policy is for 21 years which gave utter surprise and great mental shock to the complainant that the officials of Opposite Parties No.1 to 3 cheated the illiterate complainant by inducing him in false promise. Further alleges that the Opposite Parties cheated the complainant by keeping him dark and by concealing true facts and by giving wrong information/ promises while giving him policy and refused  to refund his money which shows the deficiency in service and unfair trade practice on the part of the Opposite Parties. The complainant has came to know about the fraud by the Opposite Parties. Vide instant complaint, the complainant has sought the following reliefs.

a)       The Opposite Parties may be directed to pay the sum of Rs.3,04,017/- alongwith interest @ 18% per annum  and also to pay Rs.50,000/-on account of compensation for causing  mental tension and harassment  and Rs.11,000/- as costs of litigation.

Hence, the Complainant has filed the present complaint for the redressal of her grievances. 

2.       Opposite Parties No.1 & 2-Insurance Company appeared through their counsel  and contested the complaint by filing  the written version taking preliminary objections therein inter alia that  the present complaint is not maintainable and is liable to be dismissed as there is no deficiency in service on the part of the Opposite Parties. The complainant has made allegations that he was informed that the subject policy can be cancelled after two years and the complainant will be entitled for refund of the premium paid amount alongwith interest @ 18% per annum. As per the terms and conditions of the policy, the  complainant was provided a free look period of 15 days from the date of receipt of the policies, to cancel the policy in case there are any discrepancies in the policy. The Opposite Parties No.1 and 2 as per the regulation 8(1) and 19(1) (i) of the IRDA 9protection of Policy holder’s interest) Regulations, 2017 erstwhile clause 4(1) and 6(2) of the IRDA (Protection of Policy holder’s interest) Regulation, 2002 sent the policy documents of the policy alongwith the copy of proposal form to the complainant on 15.04.2013 speedpost-EHO39918195IN which was delivered to the complainant on 15.04.2013 thereby by giving him an opportunity to review/ cancel the policy within free look period, but despite receipt of the policy documents alongwith the terms and conditions, the complainant failed to approach the Opposite Parties No.1 and 2 within free look period with any grievances with respect to the terms and conditions of the policy, thereby implying that the terms and conditions of the policy were in order. Further alleges that the complainant is not entitled for the refund of the entire premium as claimed. The complainant enjoyed the benefits under the subject policy till the time the policy was in force and now he can not be permitted to wriggle out from the same and claim the refund of the premium paid under the policy as it is not the case of the complainant that the risk was not covered by the Opposite Parties. In the present case, the complainant was required to pay the premium for a period of 6 years and get the maturity benefits after the maturity of the policy i.e. after 20 years and the complainant paid the premiums till 02.09.2017 totalling to Rs.1,78,552.09 paisa and the next renewal premium which fell due on 02.09.2017 remained unpaid therefore the policy lapsed. The complainant has failed to revive the policy after the expiry of the revival period therefore the policy entered in reduced paid up mode as per the option opted by the complainant in the proposal form. The complainant has also an option to surrender the policy and on receipt of surrender request, the Opposite Parties shall pay the surrender value as per the terms and conditions of the policy. On merits, Opposite Parties No.1 to 2-Insurance Company took up almost the same and similar pleas as taken by them in the preliminary objections and it was prayed that the complaint may be dismissed with costs.  

3.       Opposite Party No.3-Bank appeared through their counsel  separately  and contested the complaint by filing  the written version taking preliminary objections therein inter alia that  the present complaint is not maintainable and is liable to be dismissed as there is no deficiency in service on the part of answering Opposite Party. Further alleges that Opposite Party No.3 bank is not carrying on Insurance Business as per the provisions of the Banking Regulation Act, 1949 and hence does not offer insurance products. The policy that forms the subject matter of this complaint was issued by Opposite Party No.1 and hence, the complaint can not be maintained nor relief, sought by the complainant be ordered against Opposite Party No.3. there exists no privity of contra ct between the complainant and Opposite Party No.3 bank and as such, the complaint can not be filed against Opposite Party No.3 and is liable to be dismissed. Moreover,  it is settled principle of law under section 230 of Indian Contract Act that an agent can neither sue or be sued except under the special circumstances mentioned therein. Section 230 provides that in the absence of any contract to that effect, an agent cannot personally enforce contracts entered into by him on behalf of his principal, nor is he personally bound by them. On merits, Opposite Party No.3 took up almost the same and similar pleas as taken by them in the preliminary objections and it was prayed that the complaint may be dismissed with costs  

4.       In order to  prove  his  case, the complainant has tendered into evidence his affidavit Ex.CW1/A alongwith copies of documents Ex.C1 to Ex.C6  and closed the evidence on behalf of the complainant.

5.       On the other hand, Opposite Parties No.1 to 2-Insurance Company also tendered into evidence the affidavit of Sh.Prashant Singh Ex.OLP1,2/A alongwith copies of documents Ex.Ops1,21/1 to Ex.Ops1,2/6. Similarly, Opposite Party No.3 also tendered into evidence the copies of documents Ex.OP3/1 and Ex.OP3/2 and affidavit of Mr.Gaurav Jain Ex.OP3/3 and thereafter, the Opposite Parties closed their respective evidence.  

6.       We have heard the ld.counsel for the parties and also  gone through the documents placed  on record.

7.       Ld.counsel for the Complainant has  mainly reiterated the facts as narrated in the complaint and contended that in the first week of March, 2013, the complainant visited the Opposite Party No.3 bank for some transaction in his saving bank account and on the allurement of agent of Opposite Party No.3 that he will get the interest @ 18% per annum on the premium amount, the complainant purchased the policy of the Opposite Parties No.1 and 2 and  at that time, the agent of Opposite Parties No.1 and 2 got signature of the complainant on blank papers and also got signed the bank withdrawal voucher to transfer the money from the bank account being maintained with Opposite Party No.3 bank and told the complainant that he could collect the receipt of premium after 15 days from the bank and the original policy will he handed over to the complainant after 1 to 2 months. But despite various requests and reminders, to the agent of Opposite Parties No.1 and 2, the original policy has not been provided to the complainant. However, the complainant was regularly paying the premium of policy by showing the premium paid slip issued by them. After 4 years, the complainant approached the Opposite Party No.3 bank as he was  urgent need of money and at that time, the complainant had  deposited Rs.1,76,293/- as premium amount, but the officials of Opposite Party No.3 told that the complainant will get only Rs.68,000/- on liquidation. The complainant came to know that the bank is the authorized agent of Opposite Parties No.1 and 2 and selling the policies to their innocent, illiterate customers by enumerating false schemes, benefits in collusion and in connivance with Opposite Parties No.1 and 2 by making false promises. At that time, the officials of Opposite Party No.3 told that the said policy is for 6 years and after 6 years, he will get 100% of the amount paid alongwith onus and asked to continue the policy, then after  2 days of making request by Opposite Party No.2, the complainant received a message on his mobile phone that “Max life offers late fee waiver to revive  your policy 882191117. Pay Rs.125724 to revive and save Rs.20041. This is applicable for limited period (28 Feb-2019)”.  On assurance and taking belief of officials of Opposite Party No.2, the complainant deposited a sum of Rs.125724/- on 27.02.2019 for total premium of policy. After one month, the complainant approached the office of Opposite Party No.2 and after showing the premium paid slip wants to liquidate the policy and after inspection of the policy, he said that he will get only Rs.1 lakh on liquidation of the policy as this policy is for 21 years which gave utter surprise and great mental shock to the complainant that the officials of Opposite Parties No.1 to 3 cheated the illiterate complainant by inducing him in false promise. Further contended that the Opposite Parties cheated the complainant by keeping him dark and by concealing true facts and by giving wrong information/ promises while giving him policy and refused  to refund his money which shows the deficiency in service and unfair trade practice on the part of the Opposite Parties. The complainant came to know about the fraud by the Opposite Parties.

8.       On the other hand, ld.counsel for Opposite Parties No.1 to 2-Insurance Company  has repelled the aforesaid contention of the ld.counsel for the complainant and contended that   the complainant has made allegations that he was informed that the subject policy can be cancelled after two years and the complainant will be entitled for refund of the premium paid amount alongwith interest @ 18% per annum. As per the terms and conditions of the policy, the  complainant was provided a free look period of 15 days from the date of receipt of the policies, to cancel the policy in case there are any discrepancies in the policy. The Opposite Parties No.1 and 2 as per the regulation 8(1) and 19(1) (i) of the IRDA 9protection of Policy holder’s interest) Regulations, 2017 erstwhile clause 4(1) and 6(2) of the IRDA (Protection of Policy holder’s interest) Regulation, 2002 sent the policy documents of the policy alongwith the copy of proposal form to the complainant on 15.04.2013 speedpost-EHO39918195IN which was delivered to the complainant on 15.04.2013 thereby by giving him an opportunity to review/ cancel the policy within free look period, but despite receipt of the policy documents alongwith the terms and conditions, the complainant failed to approach the Opposite Parties No.1 and 2 within free look period with any grievances with respect to the terms and conditions of the policy, thereby implying that the terms and conditions of the policy were in order. Further alleges that the complainant is not entitled for the refund of the entire premium as claimed. The complainant enjoyed the benefits under the subject policy till the time the policy was in force and now he can not be permitted to wriggle out from the same and claim the refund of the premium paid under the policy as it is not the case of the complainant that the risk was not covered by the Opposite Parties. In the present case, the complainant was required to pay the premium for a period of 6 years and get the maturity benefits after the maturity of the policy i.e. after 20 years and the complainant paid the premiums till 02.09.2017 totalling to Rs.1,78,552.09 paisa and the next renewal premium which fell due on 02.09.2017 remained unpaid therefore the policy lapsed. The complainant has failed to revive the policy after the expiry of the revival period therefore the policy entered in reduced paid up mode as per the option opted by the complainant in the proposal form. The complainant has also an option to surrender the policy and on receipt of surrender request, the Opposite Parties shall pay the surrender value as per the terms and conditions of the policy. Ld.counsel for Opposite Party No.3-bank also contended that Opposite Party No.3 bank is not carrying on Insurance Business as per the provisions of the Banking Regulation Act, 1949 and hence does not offer insurance products. The policy that forms the subject matter of this complaint was issued by Opposite Party No.1 and hence, the complaint can not be maintained nor relief, sought by the complainant be ordered against Opposite Party No.3. there exists no privity of contra ct between the complainant and Opposite Party No.3 bank and as such, the complaint can not be filed against Opposite Party No.3 and is liable to be dismissed.

9.       The main plea of the Opposite Parties No.1 and 2-Insurance Company is that the complainant has purchased the policy after understanding its terms and conditions and as per the terms and conditions of the policy, the  complainant was provided a free look period of 15 days from the date of receipt of the policies, to cancel the policy in case there are any discrepancies in the policy. The Opposite Parties No.1 and 2 as per the regulation 8(1) and 19(1) (i) of the IRDA 9protection of Policy holder’s interest) Regulations, 2017 erstwhile clause 4(1) and 6(2) of the IRDA (Protection of Policy holder’s interest) Regulation, 2002 sent the policy documents of the policy alongwith the copy of proposal form to the complainant on 15.04.2013 speedpost-EHO39918195IN which was delivered to the complainant on 15.04.2013 thereby by giving him an opportunity to review/ cancel the policy within free look period, but despite receipt of the policy documents alongwith the terms and conditions, the complainant failed to approach the Opposite Parties No.1 and 2 within free look period with any grievances with respect to the terms and conditions of the policy, thereby implying that the terms and conditions of the policy were in order. The complainant has nowhere denied that he did not receive said speedpost envelop containing the policy in question alongwith its terms and conditions. Moreover,  the complainant was given the entire knowledge about the terms and conditions and that being happily agreed and purchased the product, wherein it was clearly agreed upon that once the product is sold, can not be returned back and as such there will be no refund and this version has nowhere denied by the Complainant by filing any cogent and convincing evidence to prove that the Complainant never accepted such  terms and conditions of the Opposite Party  while purchase the policies in question.  In this regard, we find force in the judgment of Hon’ble Supreme Court in the case of Grasim Industries Ltd. Vs. Agarwal Steel, 2009(4) CCC598 (SC), wherein it was observed that the person who signed the documents, there is presumption that he understood the document and only then he signed it specifically he is an educated person unless contrary is proved that it was obtained under some threat, pressure or coercion. It is well settled principle of law that the parties are bound by the terms and conditions of the Insurance Policy, and none of the parties can seek any relief beyond those terms and conditions. In this regard reference may be made to the observation made by the Hon’ble Apex Court in case cited as Suraj Mal Ram Niwas Oil Mills (P) Ltd. Versus United India Insurance Co. Ltd and another, 2011 CTJ 11 (Supreme Court) (CP) wherein the Division Bench of the Hon’ble Apex Court consisting of Hon’ble Mr. Justice D.K. Jain and Hon’ble Mr. Justice T.S. Thakur, held that:-

“22.     Before embarking on an examination of the correctness of the grounds of repudiation of the policy, it would be apposite to examine the nature of a contract of insurance. It is trite that in a contract of insurance, the rights and obligations are governed by the terms of the said contract. Therefore, the terms of a contract of insurance have to be strictly construed, and no exception can be made on the ground of equity………..”

“24.     Thus, it needs little emphasis that in construing the terms of a contract of insurance, the words used therein must be given paramount important, and it is not open for the Court to add, delete or substitute any words. It is also well settled that since upon issuance of an insurance policy, the insurer undertakes to indemnify the loss suffered by the insured on account of risk covered by the policy, its terms have to be strictly construed to determine the extent of liability of the insurer. Therefore, the endeavour of the court should always be to interpret the words in which the contract is expressed by the parties.”

The facts and circumstances of the instant case are fully attracted to Suraj Mal Ram Niwas Oil Mills (P) Ltd case (Supra). Same view has also been expressed by Hon'ble State Consumer Disputes Redressal Commission, Punjab at Chandigarh in  First Appeal No.485 of 2019 in case  Reliance Nippon Life Insurance Company Limited, Versus Atma Singh, decided recently on 11.11.2021.

10.     Moreover, there was sufficient time with the Complainant to get cancel the policies in question within free look period of 15 days after the receipt of the policies. As per the terms of  the policy contract  if  the  policy is not suitable, the policy holder may get  his/her  policy  reviewed by  returning the policy and policy documents within 15 days (Free Look Period) from the day the policy holder received the policy. The insurance company will return the premium paid to the complainant after making certain deductions specified therein. In the present case, The Policies were sent to the complainant and the same was delivered on The complainant after the receipt of the subject policies and policy documents did not approach the replying OP and got his subject policies reviewed/cancelled within Free Look period implying that the complainant duly accepted the subject policies and its documents with its terms and conditions. The complainant never approached the replying opp. party with any grievance pertaining to the subject policies and its terms and conditions and straight away filed the present complaint. The complainant is now estopped from raising the issues/ grievances with respect to refund of premium of the subject policy. The complainant is bound by the policy contract and given up /relinquish / waved his right by not exercising the Free look Provision. Thus, the complaint is devoid of any merit and is liable to be dismissed. That the opposite party as per clause 4(1) and 6(2) of the IRDA (Protection of Policy Holder’s Interest) Regulations, 2002, sent the policies and policy documents along with the copy of the proposal forms to the complainant giving him opportunity to review/cancel the policy within freelook period. The policy documents were dispatched to the complainant on at the address of the complainant and same was received by the complainant, which is also not disputed in the present complaint. Despite receipt of the policy and policy documents, the complainant failed to approach the opposite party within free look period making any grievance with respect to the policy or its terms and conditions, implying the policy and its terms and conditions were duly accepted by the complainant and were in order. The complainant is bound by the policy contract and given-up/relinquish/waived his right by not exercising the freelook provision. In view of the Judgements passed by the Honourable National Commission in Prema & Ors. Vs. Life Insurance Corporation of India, IV (2006) CPJ 239 (NC) and in Kishore Chandrakant Rathod v. Managing Director, ICICI Prudential Life Insurance Co Ltd and Ors, (Revision Petition No. 3390 of 2013, NCDRC), the onus was on the Complainant to read the contents of both the documents.The applicant is now estopped from raising the issues / grievances with respect to refund of premium of the subject policies. The applicant is bound by the policy contract and given up / relinquish / waved his right by not exercising the Free look Provision. Thus, the application is devoid of any merit and  is liable to be dismissed.That in the case titled as “Pramod Kumar vs. SBI Life Insurance Co.” decided by DCDRF, (North-West) New Delhi, on 18/02/2014 (Case No.-935/2012) it has been held as under : -“…We have heard arguments advanced at the bar and have perused the record. The applicant has admitted that he had received the policy bond from which he had learned that he has being issued with another policy rather than the one for which he had made an application. If it was so the applicant had the option to reject the policy bond received by him within the Free Look period of 15 days. Since the applicant didn’t exercised the said option he cannot now raise a grievance about the same. In view of the judgement cited above we hold that there is no deficiency of service on the part of the OP…”. Furthermore it has been determined through catena of judgments passed by the Hon’ble National Consumer Disputes Redressal Commission New Delhi, in Mohan Lal Benal v/s ICICI Prudential Life Insurance Co. Ltd. and Harish Kumar Chadha v/s Bajaj Allianz Life Insurance Co. Ltd. that if the insured/Applicant is not satisfied with the policy taken, then he/she should avail the option of returning the policy within 15 days of receipt i.e. within “the Free-look Period”. The said proposition has also been clearly laid down in the case Shrikant Murlidhar Apte vs. Life Insurance Corporation of India, Revision Petition no. 634 of 2012 decided on 02.05.2013. Further, the National Commission concurred with the findings of Maharashtra State Consumer Disputes Redressal Commission, Mumbai that “Once 15 days ‘cooling off’ period is over, policy documents become binding on both the parties and the contents therein are also biding on both of them.”

11.     Furthermore, the Complainant in his complaint has pleaded that the Opposite Parties have played a fraud with him by misspelling the product by way of misrepresentation.  In this regard, Hon’ble National Commission in case Reliance Industries Ltd. Vs. United Insurance Co. (1998) CPJ 13 has held that when the         questions of fraud and cheating are involved, in regard to the claim of the Complainant, which require thorough scrutiny, including the examination of various documents and supporting oral evidence, the Consumer Fora cannot adjudicate upon the matter. Further in case Jayantilal Keshavlal Chauhan Vs. The National Insurance Co. Ltd.[1994 (1) CPR 396]: The Hon’ble National Commission held that if “fraud” is alleged, it is desirable that the complainant should be directed to Civil Court as investigation about such fraud is required to be done.

12.     Keeping in view the aforesaid facts and circumstances of the case, the instant complaint is not maintainable in this District Consumer Commission for its proper adjudication and the same stands dismissed. However, the complainant can get redressal of his grievance from the Civil Court/ or any other  competent authority, in accordance with law, for which the time spent before this District Commission shall stand excluded under Section 14 of the Limitation Act in the light of the judgment of the Hon'ble Supreme Court in case titled 'Lakshmi Engineering Works vs PSG Industrial Institute reported in 1995(3) SCC 583'. However, keeping in view the peculiar circumstances of the case, the parties are left  to bear their own costs. Copies of the order be furnished to the parties free of costs. File is ordered to be consigned to the record room.

13.     Reason for delay in deciding the complaint.

          This complaint could not be decided within the prescribed period because the State Government has not appointed any of the Whole Time Members in this Commission for about 3 years i.e. w.e.f. 15.09.2018 till 27.08.2021 as well as due to pandemic of COVID-19.

Announced in Open Commission.

Dated:28.03.2022.