STATE CONSUMER DISPUTES REDRESSAL COMMISSION,
U.T., CHANDIGARH
First Appeal No. | : | 17 of 2013 |
Date of Institution | : | 15.01.2013 |
Date of Decision | : | 21.03.2013 |
Ms. Reena Singh d/o Late Lt. Col. Darshan Singh, R/o H.No.134, Sector 27, Chandigarh 160019
……Appellant/Complainant.
Versus
1] Max New York Life Insurance Company Limited, through its Branch Manager, SCO 36-38, Sector 8-C, Chandigarh
2] Max New York Life Insurance Company Limited, through its General Manager, Regd. Office Max House, 3rd floor, 1 Dr.Jha Marg, Okhla, New Delhi 110020 India.
3] Shreeganesh Corporate Services Ltd., through its Agent Sanjeev Kumar, SCO No.8, Madhya Marg, Top Floor, Sector 7-C, Chandigarh
…Respondents/Opposite Parties.
Appeal under Section 15 of the Consumer Protection Act, 1986.
Argued by: Sh. N. S. Jagdeva, Advocate for the appellant.
Ms. Jaimini Tiwari, Advocate for respondents No.1 and 2.
Service of respondent No.3 already dispensed with vide order dated 25.01.2013.
First Appeal No. | : | 18 of 2013 |
Date of Institution | : | 15.01.2013 |
Date of Decision | : | 21.03.2013 |
Ms. Reena Singh d/o Late Lt. Col. Darshan Singh, R/o H.No.134, Sector 27, Chandigarh 160019
……Appellant/Complainant.
Versus
1] Max New York Life Insurance Company Limited, through its Branch Manager, SCO 36-38, Sector 8-C, Chandigarh
2] Max New York Life Insurance Company Limited, through its General Manager, Regd. Office Max House, 3rd floor, 1 Dr.Jha Marg, Okhla, New Delhi 110020 India.
3] Shreeganesh Corporate Services Ltd., through its Agent Sanjeev Kumar, SCO No.8, Madhya Marg, Top Floor, Sector 7-C, Chandigarh
…Respondents/Opposite Parties.
Appeal under Section 15 of the Consumer Protection Act, 1986.
Argued by: Sh. N. S. Jagdeva, Advocate for the appellant.
Ms. Jaimini Tiwari, Advocate for respondents No.1 and 2.
Service of respondent No.3 already dispensed with vide order dated 25.01.2013.
PER MRS. NEENA SANDHU, MEMBER.
This order shall dispose of two appeals bearing Nos.17 and 18 both of 2013, filed by the appellant, against the common order dated 18.12.2012, rendered by the District Consumer Disputes Redressal Forum-I, U.T., Chandigarh (hereinafter to be called as the District Forum only), vide which it dismissed two complaints bearing No.370/2012 and No.371/2012, filed by the appellant/complainant.
2. Since, the facts involved in both the complaints, are completely identical, the same are being culled out from Consumer Complaint No.370 of 2012 – Ms. Reena Singh Vs. Max New York Life Insurance Company Limited.
3. The facts, in brief, are that on being assured about the good returns, by the agent of to Opposite Parties, the complainant purchased Capital Builder 15 years Unit Linked Policy, from the Opposite Parties and paid three regular premium of Rs.50,000/- each i.e. a total sum of Rs.1.50 lacs. It was stated that at the time of taking the said policy, the Opposite Parties Company had assured the complainant that the premium would be doubled after three years. It was further stated that the complainant only put her signatures on the form, whereas the same was not filled up by her. It was further stated that neither the terms and conditions were brought to the notice of the complainant nor the clauses were read over to her. It was further stated that no copy of the forms and documents were handed over to the complainant for the purpose of reading the same before signatures. It was further stated that after the expiry of three years, when the complainant visited the Office of the Opposite Parties for withdrawal of amount, she was shocked to know that she would be refunded the amount after the deduction of more than 50% of the amount deposited.
4. It was further stated that on the assurance of Opposite Parties, in order to get her all paid-up premiums, the complainant made further investment of Rs.20,000/- in another policy namely Base Policy 10 yrs endowment Plan, the proposal form of which was also filled-up by the agent of the Opposite Parties. It was further stated that the complainant thus paid premiums to the tune of Rs.1,75,000/- towards Policy No.454626631 and Rs.1,50,000/- towards Policy No.701122657. She kept on requesting the Opposite Parties, to cancel her policies and refund the deposited amount, but all in vain. It was further stated that a legal notice was also sent to the Opposite Parties, but to no effect. It was further stated that the act and conduct of the Opposite Parties, amounted to deficiency, in rendering service and indulgence into unfair trade practice. When the grievance of the complainant, was not redressed, left with no alternative, two complaints under Section 12 of the Consumer Protection Act, 1986 (hereinafter to be called as the Act only), directing the Opposite Parties, to cancel the policies, in question, and to refund the amounts of Rs.1,50,000/- and Rs.1,75,000/- alongwith interest @15% per annum; Rs.50,000/- as compensation for harassment and mental agony and Rs.11,000/- as costs of litigation, was filed.
5. Opposite Parties No.1 and 2, in their written version, while admitting the factum of issuance of policies, in question, as well as deposit of premiums thereof, stated that complete policy document containing the terms & conditions was duly delivered to the complainant. It was stated that the complainant was well aware that the premium was to be paid regularly. It was further stated that Opposite Parties No.1 and 2 had issued the policy, in question, on the basis of Proposal Form, submitted by the complainant. It was further stated that as per the terms and conditions of the insurance policy, in case, the complainant had any grouse, she could have applied for cancellation of the same within the free look period of 15 days from the receipt of policy, but she did not avail the said option. It was further stated that the complainant after 19.11.2008, did not pay the regular premium, and, as such, her policy lapsed, which was duly intimated to her. It was further stated that in response to the request of the complainant for refund of the amount in respect of her three policies No.701122657, 454626631 and 829703875, she was informed that her request could not be processed, as the insurance policies were outside the free look period. It was further stated that while paying premiums for the last three years, the complainant never raised the issue with regard to forgery done by the Company. It was further stated that there was, thus, neither any deficiency in rendering service, on the part of Opposite Parties No.1 and 2, nor they indulged into unfair trade practice. The remaining allegations, contained in the complaint were denied.
6. Opposite Party No.3 did not appear despite service, and hence it was proceeded against exparte, by the District Forum, vide order dated 27.09.2012.
7. The parties led evidence, in support of their case.
8. After hearing the Counsel for the parties, and, on going through the evidence, and record of the case, the District Forum, dismissed the complaints, vide the common impugned order, as sated above.
9. Feeling aggrieved, the appellant/complainant, has filed the instant appeals.
10. We have heard the Counsel for the parties, and, have gone through the evidence and record of the case, carefully.
11. The Counsel for the appellant/complainant, submitted that neither the agent disclosed the contents of the forms/documents nor the terms and conditions nor the clauses were read over to the appellant/complainant nor she was made to understand the same by Opposite Party No.3 (agent). It was further submitted that after paying premiums for three years regularly, when the appellant/complainant approached the office of the Opposite Parties, for withdrawal of amount, she was informed that she would be paid the amount after deduction of more than 50% of the total amount deposited by her, in terms of the policy conditions. It was further submitted that the Opposite Parties sold the policies, in question, with complete misrepresentation/concealment of material facts and by projecting huge profits. It was further submitted that the even the Opposite Parties did not make the appellant/complainant conversant with the provision of free look period of 15 days, to surrender the policy. It was further submitted that before the fact of free look period came to the knowledge of the appellant/complainant, 15 days free look period had already expired. It was further submitted that the Opposite Parties, are liable to refund the amount of premium, in view of Clause 7 relating to “Obligations of an insurer upon discontinuance of a policy” ofCircular No.049/IRDA/ ACTLIULIP/JANUARY-08 dated 01.01.2008, of Insurance Regulatory and Development Authority (IRDA). It was further submitted that the District Forum wrongly dismissed the complaints of the appellant/complainant without appreciating the guidelines/ circular of IRDA. It was further submitted that the District Forum failed to appreciate the fact that the respondents failed to prove as to how they deducted 50% from the amount paid by the appellant/complainant whereas, the appellant/complainant deposited Rs.1,50,000/- and Rs.1,75,000/- respectively for two policies, as premium for three years. He vehemently argued that even the appellant/complainant was entitled to get the surrender value as per Regulation 7 of Insurance Regulatory and Development Authority (Treatment of Discontinued Linked Insurance Policies) Regulations, 2010, notified vide notification dated 01.07.2010. He further submitted that therefore, the order of the District Forum being not sustainable in the eye of law, is liable to be set aside.
12. On the other hand the Counsel for respondents No.1 and 2, submitted that complete policy document containing the terms & conditions was duly delivered to the complainant, on the basis of Proposal Form, submitted by her, and she was well aware that the premium was to be paid regularly. It was further submitted that there was no lapse on the part of their agent (Respondent No.3), in the performance of his duties, in making aware the appellant/complainant, as regards the policies. It was further submitted that that the appellant/ complainant could have applied for cancellation of the same within 15 days free look period, from the receipt of policy, but she did not avail of the said option. The Counsel for respondents No.1 & 2/Opposite Parties No.1 and 2 further submitted that the District Forum rightly dismissed the complaint and the present appeal filed by the appellant/complainant is liable to be dismissed.
13. We find force in the submissions of the Counsel for respondents No.1 and 2, that respondent No.3 was not liable. The perusal of record reveals that respondent No.3, being an agent acted for and on behalf of the respondents/Opposite parties 1&2 and the terms and conditions were to be supplied by them (respondents/Opposite Parties No. 1&2) and not by respondent/Opposite Party No.3 and, as such, there was no deficiency in rendering service on the part of respondent/Opposite Party No.3. As such, the complaint is liable to be dismissed against respondent/Opposite Party No.3.
14. Insurance Regulatory and Development Authority (Treatment of Discontinued Linked Insurance Policies) Regulations, 2010, were notified vide notification dated 01.07.2010. Regulation 7 of the Regulations ibid reads as under;
“ Obligation of an insurer upon discontinuation of a policy
7. The obligation of an insurer in this regard shall be as follows:-
i. To impose discontinuance charges only to recoup expenses incurred towards procurement, administration of the policy and incidental thereto.
ii. To design the discontinuance charges to encourage the policyholder to continue with the contract for the full term;
iii. To ensure that the discontinuance charges reflect the actual expenses incurred.
iv. To structure the discontinuance charges within the statutory ceiling on commissions and expenses and
v. To ensure that the charges levied on the date of discontinuance (as a percentage of one annualized premium) do not exceed the limits specified below:-
Where the policy is discontinued during the policy year | Maximum Discontinuance charges for policies having annualized premium up to and including Rs.25000/- | Maximum discontinuance charges for policies having annualized premium above Rs.25000/- |
| Lower of 20% (AP or FV subject to a maximum of Rs.3000/- | Lower of 6% of (AP or FV) subject to maximum of Rs.6000/- |
| Lower of 15% (AP or FV subject to a maximum of Rs.2000/- | Lower of 4% of (AP or FV) subject to maximum of Rs.5000/- |
| “Lower of 10% (AP or FV subject to a maximum of Rs.1500/- | Lower of 3% of (AP or FV) subject to maximum of Rs.4000/- |
| Lower of 5% (AP or FV subject to a maximum of Rs.1000/- | Lower of 2% of (AP or FV) subject to maximum of Rs.2000/- |
| | |
Ap- Annualised premium
Fv- fund value on the date of discontinuance
Provided that where a policy is discontinued, only discontinuance charge may be levied by the insurer and no other charges by whatsoever name called shall be levied.
Provided that no discontinuance charges shall be imposed on single premium policies and on top ups.”
15. Admittedly in Consumer Complaint No.371/2012, the complainant surrendered the policy bearing No.454626631, in the year 2012 vide Annexure C-5 i.e. after the completion of period of 3 years, and the aforesaid Regulations came into force, in the year 2010. Admittedly, also the Insurance Companies are governed by the Insurance Regulatory and Development Authority (Treatment of Discontinued Linked Insurance Policies) Regulations, 2010, which were notified vide notification dated 01.07.2010 i.e. much before the cause of action accrued to the appellant/complainant, in question, in the year 2012. Thus, the appellant/complainant is entitled to the surrender value as per Regulation 7, extracted above, and the respondents/ Opposite Parties No. 1 & 2, could not charge any other charges, except those mentioned therein. Since the complainant paid a sum of Rs.1,75,000/-, for the policy in question, as premium, for three years to the respondents/Opposite Parties No. 1&2, according to the Regulation extracted above, she is entitled to get Rs.1,71,000/- (Rs.1,75,000-4000) but Opposite Parties No.1&2 illegally offered 50% of the total premium amount, that too, without producing, on record, justifiable calculations thereof. As such, Opposite Parties No.1&2, are liable to pay a sum of Rs.1,71,000/- to the complainant.
16. Similarly, in Consumer Complaint No.370/2012, the appellant/complainant paid a sum of Rs.1,50,000/-, for the policy bearing No.701122657, as premium, for three years and surrendered the same in the year 2012. Therefore, the respondents/Opposite Parties No.1 and 2 are liable to pay a sum of Rs.1,46,000/- i.e. (Rs.1,50,000-Rs.4000) to the appellant/complainant.
17. Hence there was deficiency in rendering service, on the part of respondents/Opposite Parties No.1&2.
18. The complainant is also entitled to get compensation on account of the mental agony and physical harassment caused to her by respondents/ Opposite Parties No.1&2, as they failed to pay her the amount, which was legally payable to her as per the Regulation extracted above. These facts were not properly appreciated, by the District Forum. Thus the order of the District Forum being perverse, is not sustainable in the eye of law, and the same is liable to be set aside.
19. In view of the above, we find merit in both the appeals and, accordingly, the same are allowed with costs against Respondents/Opposite Parties No.1&2. The order of the District Forum dated 18.12.2012, is set aside and both the complaints bearing No.370/2012 and 371/2012 are allowed, in the following manner:-
Consumer Complaint No.370/2012. (Policy No.701122657)
Respondents/Opposite Parties No.1&2 are directed as follows: -
i) To pay to the complainant Rs.1,46,000/- as held in para No.16.
ii) To pay to the complainant Rs.10,000/- as compensation, for mental agony and physical harassment.
iii) To pay Rs.5,000/- as cost of litigation.
The aforesaid order shall be complied with, by Opposite Parties/respondents No.1&2, within 30 days from the date of receipt of a certified copy of the order, failing which they shall be liable to pay interest on the aforesaid awarded amount mentioned in clause (i) & (ii) above @12% p.a. from the date of filing the complaint till its realization, besides payment of costs of litigation of Rs.5,000/-.
Consumer Complaint No.371/2012. (Policy No. 454626631)
Respondents/Opposite Parties No.1&2 are directed as follows: -
i) To pay to the complainant Rs.1,71,000/- as held in para No.15.
ii) To pay to the complainant Rs.10,000/- as compensation, for mental agony and physical harassment.
iii) To pay Rs.5,000/- as cost of litigation.
The aforesaid order shall be complied with, by Opposite Parties/respondents No.1&2, within 30 days from the date of receipt of a certified copy of the order, failing which they shall be liable to pay interest on the aforesaid awarded amount mentioned in clause (i) & (ii) above @12% p.a. from the date of filing the complaint till its realization, besides payment of costs of litigation of Rs.5,000/-.
20. However, as held in Para No.13 of the instant order both the appeals against respondent No.3/Opposite Party No.3, are dismissed.
21. Certified copy of this order be placed in First Appeal No.18 of 2013.
22. Certified Copies of this order be sent to the parties, free of charge.
23. The file be consigned to Record Room, after completion.
Pronounced.
21st March, 2013.
Sd/- [JUSTICE SHAM SUNDER [RETD.]
PRESIDENT
Sd/-
[NEENA SANDHU]
MEMBER
Ad
STATE COMMISSION
(First Appeal No.17 of 2013)
Argued by: Sh. N. S. Jagdeva, Advocate for the appellant.
Ms. Jaimini Tiwari, Advocate for respondents No.1 and 2.
Service of respondent No.3 already dispensed with vide order dated 25.01.2013.
Dated the 21st day of March, 2013.
ORDER
Vide our detailed order of even date, recorded separately, this appeal alongwith connected appeal bearing No.18 of 2013, have been allowed against respondents/Opposite Parties No.1&2, with costs as per directions. However, both the appeals against respondent No.3, have been dismissed. The order of the District Forum has been set aside and the complaints have been allowed.
(NEENA SANDHU) MEMBER | (JUSTICE SHAM SUNDER(RETD.)) PRESIDENT | |
Ad
STATE CONSUMER DISPUTES REDRESSAL COMMISSION,
U.T., CHANDIGARH
First Appeal No. | : | 18 of 2013 |
Date of Institution | : | 15.01.2013 |
Date of Decision | : | 21.03.2013 |
Ms. Reena Singh d/o Late Lt. Col. Darshan Singh, R/o H.No.134, Sector 27, Chandigarh 160019
……Appellant/Complainant.
Versus
1] Max New York Life Insurance Company Limited, through its Branch Manager, SCO 36-38, Sector 8-C, Chandigarh
2] Max New York Life Insurance Company Limited, through its General Manager, Regd. Office Max House, 3rd floor, 1 Dr.Jha Marg, Okhla, New Delhi 110020 India.
3] Shreeganesh Corporate Services Ltd., through its Agent Sanjeev Kumar, SCO No.8, Madhya Marg, Top Floor, Sector 7-C, Chandigarh
…Respondents/Opposite Parties.
Appeal under Section 15 of the Consumer Protection Act, 1986.
BEFORE: JUSTICE SHAM SUNDER (RETD.), PRESIDENT.
MRS. NEENA SANDHU, MEMBER.
Argued by: Sh. N. S. Jagdeva, Advocate for the appellant.
Ms. Jaimini Tiwari, Advocate for respondents No.1 and 2.
Service of respondent No.3 already dispensed with vide order dated 25.01.2013.
PER MRS. NEENA SANDHU, MEMBER.
1. For orders, see the orders passed in First Appeal No.17 of 2013 titled “Ms. Reena Singh Vs. Max New York Life Insurance Company Limited and others”, vide which this appeal has been allowed against respondents No.1 and 2 only, with costs, as per directions. However, it has been dismissed against respondent No.3.
2. Copies of this order be sent to the parties free of charge.
Pronounced.
21st March, 2013.
Sd/-
[JUSTICE SHAM SUNDER (RETD.)]
PRESIDENT
Sd/-
[NEENA SANDHU]
MEMBER
Ad
