DISTRICT CONSUMER DISPUTES REDRESSAL FORUM,

BATHINDA (PUNJAB)

CC No. 147 of 01-04-2010

Decided on : 30-11-2010

Mandeep Singh Dhillon, aged about 38 years R/o H. No. 16310. Street No. 13, Dhillon Colony, Barnala Road, Bathinda.

.... Complainant

Versus

1. Max New York Life Insurance Company, Operation Centre, Plot No. 90A, sector 18 Udyog Vihar, Gurgaon (Haryana), through its M.D.

2. Max New York Life Insurance Company, G.T. Road, Bathinda, through its Manager

3. Indiabulls Credit Services, Deep Complex, G.T. Road, Bathinda, through its Branch Manager

4. Indiabulls Financial Services Limited, F-60, 2^nd Floor, Malhotra Building, Connaught Place, New Delhi 110 001, through its M.D./Chairman

   ..... Opposite parties

Complaint under Section 12 of the Consumer Protection

Act, 1986.

 

QUORUM

Ms. Vikramjit Kaur Soni, President

Dr. Phulinder Preet, Member

Sh. Amarjeet Paul, Member

For the Complainant : Sh. Rajneesh Rampal, counsel for the complainant.

For the Opposite parties : Sh. N K Batta, counsel for opposite

party Nos. 1 & 2.

Sh. J D Nayyar, counsel for opposite party Nos. 3 & 4.

O R D E R

VIKRAMJIT KAUR SONI, PRESIDENT

1. The complainant has filed this complaint under Section 12 of the Consumer Protection Act, 1986 (Here-in-after referred to as 'Act'). The complainant took a loan from opposite party No. 3 and opposite party No. 3 obtained the primary security for the repayment of the said amount of loan alongwith upto date interest. At the time of applying of loan, the opposite party No. 3 also obtained the signatures of the complainant on various blank printed papers. The complainant also purchased the Life Insurance Policy No. 741315063 from opposite party Nos. 1 & 2 vide proposal dated 30.7.2009 and deposited the requisite amount of premium of Rs. 50,000/- which was paid directly by opposite party No. 3 by deducting the same from loan amount. The sum Insured was Rs. 10,00,000/- and maturity date was 20-08-2029. The opposite party No. 3 illegally and fraudulently got the said insurance policy of the complainant assigned with it by obtaining the signatures of the complainant on some blank papers and fabricated the assignment deed in its favour as a collatral security for the repayment of loan amount regarding the loan raised by the complainant from opposite party No. 3. The complainant came to know about the said act of the opposite party only after 30-10-2009 when he obtained a letter from the opposite party Nos. 1 & 2 vide which the opposite party No. 2 refused to proceed with the request of the complainant to cancel the said policy which he wanted to cancel in order to meet his necessity of money. The opposite party Nos. 1 & 2 informed the complainant that the said policy is assigned with opposite party No. 3 and the same cannot be cancelled without the stamp and signatures of opposite party No. 3. The complainant approached opposite party No. 3 to put the signatures and stamp on the requisite document for giving consent for cancellation of the insurance policy in question, but opposite party No. 3 refused to accede to his request. The complainant also got issued a legal notice to the opposite parties on 25-01-2010, calling upon opposite party No. 3 to put stamp and signature on the requisite documents, but opposite party No. 3 did not reply to the notice. The complainant has already furnished the requisite primary security for the repayment of loan amount and there was no necessity to assign the said Insurance policy with opposite party No. 3. Hence, this complaint for issuing directions to the opposite parties to cancel his above said policy; refund the amount of premium and pay him compensation and cost.

2. The opposite party Nos. 1 & 2 filed their joint written reply and submitted that on 30-07-2009 after understanding, all the terms and conditions of the policy, the complainant filled up a Proposal Form for a Life Maker Premium plan for an assured sum of Rs. 10,00,000/-. Under the said policy a premium of Rs. 50,000/- was to be paid annually. On the basis of proposal form, policy bearing No. 741315063 was issued to the complainant. As per Clause 23 of the policy contract, it could be assigned in the favour of the person named by the policy holder. They further submitted that they received a letter dated 31-07-2009 from the complainant requesting the opposite party to assign his policy to India Bulls and therefore, the same was duly processed and assigned to Indiabulls Financial Services Ltd., and despatched to the complainant on 22-09-2009. The policy was assigned to Indiabulls on the request of the complainant and the same cannot be cancelled without the written authority of opposite party No. 3.

3. The opposite party Nos. 3 & 4 filed their joint reply and submitted the Insurance policy had been obtained by the complainant voluntarily after signing of the documents which included the Insurance papers after thoroughly reading the same and understanding the contents therein. No signatures of the complainant had ever been obtained on any blank paper. The complainant has voluntarily, after being informed have assigned the said policy as security and the same cannot be cancelled now as it forms part of the security for the loan facility.

4. The parties have led evidence in support of their respective pleadings.

5. We have heard the arguments at length and have gone through the record and perused written submissions submitted by the parties.

6. The complainant took a loan from opposite party No. 3 and opposite party No. 3 obtained the signatures of the complainant on various blank printed form. The complainant also purchased the Life Insurance Policy No. 741315063 from the opposite party Nos. 1 & 2 vide proposal form dated 30-07-2009 and paid a premium of Rs. 50,000/-, which was duly paid by opposite party No. 3 by deducting the same from loan amount. Maturity value of this policy was 10,00,000/- and the maturity date was 20-08-2029.

7. The case of the complainant is that the opposite party No. 3 by obtaining the signatures of the complainant on some blank papers fabricated the alleged assignment deed in its favour as a collatral security for repayment of loan amount regarding loan raised by the complainant from opposite party No. 3. The complainant alleged that the opposite party Nos. 1 & 2 of their own assigned the policy of the complainant in favour of opposite party Nos. 3 & 4 whereas the opposite party Nos. 1 & 2 have taken a plea that they have assigned the policy in favour of the person named by the policy holder. On 16-09-2009, the opposite party Nos. 1 & 2 received a letter dated 30-07-2009 from the complainant requesting them to assign his policy to Indiabulls Financial Services Limited. After receiving his request, a letter dated 22-09-2009 was sent to the complainant confirming that opposite party Nos. 1 & 2 have duly assigned his policy to Indiabulls. A letter dated 7-10-2009 was received from the complainant to cancel his policy outside the free look period. The opposite party vide letter dated 30-10-2009 declined to cancel the policy of the complainant since the policy was assigned to Indiabulls and in order to proceed with the request, the opposite parties required the signatures and stamp of signing authority of Indiabulls. The opposite party Nos. 1 & 2 have further submitted that policy cannot be cancelled even if Indiabulls has no objection to it since the request for cancellation and refund of premium amount was made outside the free look period.

8. The opposite party Nos. 3 & 4 have submitted that loan was disbursed to the complainant after completing all the requisite formalities. The complainant has voluntarily signed all the documents after reading the same. They have denied that signatures of the complainant have been obtained on any blank document. They further submitted complainant has assigned the said policy as security and the same cannot be cancelled now as it forms part of the security for the loan facility.

9. The opposite party Nos. 1 & 2 sent the Insurance policy vide letter dated 20-08-2009 Ex. C-2 to the complainant. The relevant portion of the said letter is reproduced hereunder :-

   “..... Please go through the enclosed policy which explains all the features, benefits and terms of your Max New York Life Policy, in as simple a manner as possible, in the unlikely event of your not being completely satisfied with the policy, you have the option to cancel it by returning the original policy with a written request to us, within 15 (fifteen) days from the date of receipt, in such a case, the premiums paid will be refunded to you without interest, less proportionate risk premium for the period of cover and any medical fees and expenses that we may have incurred on stamp duty.”

10. The opposite party Nos. 1 & 2 in para IV of Preliminary Objections and Submissions of their written reply as well in para 8 of the affidavit Ex. R-4 have stated that opposite party received a letter dated 7-10-2009 from the complainant to cancel his policy outside the free look period. The letter dated 30-09-2010 of the complainant which was received by opposite parties on 6/7-10-2010 has been produced on file as Ex. R-12 by the opposite parties themselves. The said letter is reproduced here-under :-

    “.....I received Unit Linked Policy No. 741315063 in the name of Mandeep Singh Dhillon on 29-09-2009. I want to cancel this policy No. 741315063 because I am not satisfied with terms and conditions of the policy. So please cancel this policy.”

    The complainant has clearly mentioned in the aforesaid letter that he received the Insurance policy in question on 29-09-2009. The opposite party Nos. 1 & 2 in response to the aforesaid letter of the complainant wrote letter dated 30-10-2009 to the complainant which reads as under :-

    “...... This is with reference to your request for cancellation of policy No. 741315063.

    We are unable to proceed with the request as the policy is assigned to Indiabulls and in order to proceed with the request we require the signatures and stamp of signing authority of Indiabulls on the request.”

    The opposite party Nos. 1 & 2 have no where mentioned in their above said letter that policy in question cannot be cancelled as the complainant had applied for its cancellation after free look period. They have just required signatures and stamp of signing authority of Indiabulls. Thus, it is proved from their own evidence of opposite party No. 1 & 2 that complainant had applied for cancellation of Insurance policy in question within the Free Look Period as he received policy on 29-09-2009 and wrote letter dated 30-09-2009 which was received by the opposite parties on 6/7-1-2010. Thus, the opposite parties cannot deny the cancellation of the policy in question.

11. The plea of the opposite party Nos. 3 & 4 is that the complainant has assigned the said policy as security and the same cannot be cancelled now as it forms part of the security for the loan facility. The loan agreement was executed between the complainant and opposite party No. 1 & 2 and the Insurance policy in question was got arranged from opposite party Nos. 3 & 4 by opposite party Nos. 1 & 2 after paying the premium directly. The opposite party Nos. 1 & 2 have not produced any document on file to show that complainant was made aware of the fact that after assignment of the policy in question it would not be cancelled. Even the opposite party Nos. 1 & 2 after receiving the letter of the complainant for cancellation of policy in question, in their letter which is reproduced above, have not intimated him that policy cannot be cancelled as it forms part of the security for the loan facility. Moreover, the complainant has already mortgaged his property as per Ex. C-11, being security against his loan and there was no need for collateral security. Hence, this Forum is of the considered view that there is deficiency in service on the part of the opposite parties in not cancelling the Insurance policy of the complainant and not refunding the premium amount to him as he has applied within Free Look period.

12. In view of what has been discussed above, this complaint is accepted with Rs. 5,000/- as cost and compensation against opposite party Nos.1 & 2, and dismissed qua opposite party Nos. 3 & 4. The opposite party Nos. 1 & 2 are directed to cancel the Insurance policy No. 741315063 of the complainant with effect from the date when he applied for cancellation i.e. 7-10-2010 and refund the amount of premium to the complainant, after deducting medical fee and stamp duty, if any. The collateral security and assignment deed will automatically stand cancelled.

    The compliance of this order be made by opposite party Nos. 1 & 2 jointly and severally within 45 days from the date of receipt of copy of this order.

A copy of this order be sent to the parties concerned free of cost and the file be consigned to record.

Pronounced

30-11-2010

(Vikramjit Kaur Soni)

President

(Dr. Phulinder Preet)

Member

(Amarjeet Paul) Member