IN THE DISTRICT CONSUMERS’ DISPUTES REDRESSAL FORUM AT MYSORE<br /> <br /> PRESENT: 1. Shri.A.T.Munnoli<br /> B.A., L.L.B (Spl.) - President <br /> <br /> 2. Smt.Y.V.Uma Shenoi<br /> M.Sc., B.Ed., - Member<br /> 3. Shri. Shivakumar.J.<br /> B.A., L.L.B., - Member<br /> <br /> CC 413/09 DATED 07.12.2009<br /> ORDER<br /> <br /> Complainant K.S.Vijayakumari, <br /> W/o Hariprasad, Working as Assistant Teacher, Lower Primary School, Kaggali Koppalu, Kothavalli Post, Periyapatna Taluk, Mysore District. R/at Hadya Village, K.R.Nagara Taluk, Mysore District.<br /> <br /> (By Sri. Sudharshan.V., Advocate)<br /> <br /> Vs. <br /> Opposite Party Branch Manger, M/s Life Insurance Corporation of India, K.R.Nagar Branch, having office Mysore-Hassan Road, K.R.Nagar Town, Mysore District.<br /> <br /> (By Sri. B.N.Shashidhara, Advocate)<br /> <br /> Nature of complaint : Deficiency in service<br /> Date of filing of complaint : 07.11.2009<br /> Date of appearance of O.P. : 25.11.2009<br /> Date of order : 18.12.2009<br /> Duration of Proceeding : 23 DAYS<br /> <br /> <br /> PRESIDENT <br /> <br /> <br /> <br /> MEMBER<br /> <br /> <br /> MEMBER<br /> <br /> <br /> Sri. A.T.Munnoli,<br /> President<br /> <br /> 1. The complainant has filed the complaint under section 12 of the Consumer Protection Act against the opposite party, seeking a direction to pay a sum of Rs.18,304/-, the premium amount received together with interest at the rate of 18% p.a. and also a sum of Rs.3,00,000/- compensation with cost of the proceedings.<br /> <br /> 2. In the complaint, it is alleged that, the complainant is working as Assistant Teacher in the School, Kaggali Kopplu in Periyapatna Taluk, Mysroe District. Through Chikkamagalur Branch of the opposite party, Jivan Anand Life Insurance proposal of the complainant was submitted on 28.08.2007 under the salary saving scheme. The same assured was Rs.5,00,000/-. It was for a period of 30 years. Monthly premium was Rs.1,408/-. Two months premium was received in advance. Along with the proposal forum, the opposite party branch at Chikkamagalur obtained signature of the complainant on a requisition letter addressed to her employer requesting to deduct the monthly premium from the salary and to remit the same to the opposite party, stating that as per the Rules and Regulations, the employer of the complainant will deduct and remit the amount directly. Also, it was informed that, the policy will be transfer to concerned branch in Mysore District. The complainant received the policy bond in the month of June 2008. The date of commencement of risk was shown as 28.08.2007. It appears, the opposite party sent the requisition for deduction of the premium from the salary of the complainant to the pay disbursing officer during the month June – July 2008. Accordingly, premiums were deducted and remitted to the opposite party from July 2008. On 08.06.2009, the complainant received registered post from the opposite party containing a cheque dated 31.03.2009 for a sum of Rs.5,632/-, stating that the cheque is valid for three months. The cheque was sent with covering letter dated 05.05.2009. It was posted on 05.06.2009. In the said covering letter, opposite party has stated that, the policy is in lapsed condition. In the covering letter, it is not stated on what basis, the premium amount was sent. Till receipt of the said letter, the complainant was under impression that, the opposite party was receiving the premiums of the policy regularly. The complainant did not receive any intimation from the opposite party, calling upon her to pay the premium amount if any due. On receipt of the said letter, immediately, the complainant contacted her employer to furnish details of the amount deducted and remitted to opposite party. The employer of the complainant informed that, they received requisition letter from the opposite party in the month of June 2008 only and accordingly, premium amount of Rs.1,408/- from July 2008 was deducted and remitted to opposite party till May 2009. That was intimated to the complainant on 15.06.2009. On receipt of the said letter from the employer, the complainant approached the opposite party to furnish the details. The opposite party expressed inability to furnish the details, stating that, the file was with some other branch. Though, the complainant approached the concerned branch with a request to transfer the file. Thereafter, complainant did not receive any intimation. Considering the evasive reply of the opposite party, the complainant requested to return the entire premium amount collected together with damages and returned the cheque that she had received earlier. After much delay, on 19.08.2009, complainant received a letter of the opposite party again stating that, the policy is lapsed condition, as premium for the period commencing from October 2007 has not been paid and the premium amount of Rs.9,856/- from November 2008 to May 2009 is in deposit. The opposite party dispatched the policy bond nearly after 8 months from the date of the proposal. Non-payment of premium was not intimated by the opposite party to the complainant. Unilaterally, opposite party repudiated the policy stating that, it is in lapsed condition. Per say it amounts to deficiency in service. Thereafter, the complainant sent legal notice to the opposite party calling upon to pay Rs.18,304/-, the thirteenth months premium along with interest and damages of Rs.3,00,000/-. After a month, complainant received letter on 09.10.2009 from the opposite party containing the cheque for eleven months. It is stated in the said letter that to revive the policy, the complainant shall have to pay interest commencing from October 2007. The said cheque has not been encashed by the complainant. Considering the negligence on the part of the opposite party, now the complainant is not willing to take the policy as then she was 28 years and now, she lost the advantage that ought to have ensured to her benefit, hence damages amounting to Rs.3,00,000/- is claimed. On these grounds, it is prayed to allow the complaint.<br /> <br /> 3. In the version, the opposite party has contended that, the complainant had obtained life insurance policy bearing No.623617920 from the opposite party for a sum of Rs.5,00,000/- and initial premium for two months for August and September 2007 at the rate of Rs.1,408/- was received while submitting the proposal. It is stated, initial deposit was adjusted towards the premium and contract has been concluded. Risk for the August and September 2008 was covered. Also, it is admitted that, the complainant had signed authorization letter for recovery and remittance of premium through her employer. But, it is denied that, the opposite party took the signature on the proposal and the letter. It is contended that, the complainant being educated as read the contents of the proposal form and the authorization letter. It is stated, the complainant has received the policy bond soon after it was completed through the agent. The authorization letter was sent to the employer in June – July 2008 is denied. It is contend that, the authorization letter was sent to DEO on 14.09.2007 itself. It is further stated that, since the opposite party did not receive the premium from October 2007 to June 2008, the policy was lapsed condition. The premium amount received was kept in suspense account. Hence, it was returned to the complainant. It is stated that, the complainant should have made arrangement for remitting the premium directly to the opposite party to prevent, the policy from going into lapsed condition. It is denied that, the complainant is entitled for refund of Rs.18,304/-. Certain other allegations made in the complaint are denied. It is submitted that, the opposite party is ready to extent the insurance benefit to the complainant provided she remits of the arrears of premium with interest. The deficiency in service alleged is denied. On these grounds, it is prayed to dismiss the complaint.<br /> <br /> 4. To prove the facts alleged in the complaint, the complainant has filed her affidavit and produced certain documents. On the other hand, for the opposite party, Higher Grader Assistant by name H.S.Krishnamurthy has filed his affidavit and certain documents are produced. We have heard the arguments of learned advocates for the complainant and opposite party and perused the entire material on record.<br /> <br /> 5. Now the points arises for consideration are as under:-<br /> 1. Whether the complainant has proved any deficiency in service on the part of the opposite party and that she is entitled to the reliefs sought?<br /> 2. What order?<br /> <br /> 6. Our findings are as under:-<br /> Point no.1 : Partly in the affirmative.<br /> Point no.2 : As per the order.<br /> <br /> REASONS<br /> <br /> 7. Point no. 1:- The fact that, the complainant had policy bearing No.623617920 dated 29.08.2007 under salary saving scheme and that, the complainant had duly signed and handed over requisition letter for deduction of monthly premiums from her salary by her employer and to credit the same to the opposite party is admitted. The opposite party has contended that, since it did not receive premiums from October 2007 to June 2008, the police was in a lapsed condition. Hence, under the circumstances, the main dispute is regarding non-receipt of the premiums for the period referred to above.<br /> <br /> 8. At the cost of repetition, admittedly, the complainant had given authorization letter for deduction of premiums out of her salary by her employer and to credit the same to the opposite party and that requisition was submitted by the complainant along with the proposal Forum. The opposite party at the end of fourth paragraph of the version, has stated that, “the authorization letter was sent by our Chikkamagalur Branch Office to Block Education Office, Periyapatna on 14.09.2007 itself.” Hence, it is necessary to consider, whether really as contended by the opposite party, on the said date, the authorization letter was sent to the employer of the complainant for deduction of the premium from her salary and for crediting the same to the opposite party.<br /> <br /> 9. To substantiate the fact that, on 14.09.2007 itself, the Chikkamagalur Branch Office of the opposite party had sent the authorization letter to Block Educational Office, Periyapatna, absolutely there is no evidence. Said contention remained only in the version. It is relevant to note that, though for the opposite party Sri H.S.Krishnamurthy, an Officer of the opposite party has filed his affidavit and narrated certain other facts therein, has not at all stated that on 14.09.2007 itself, the authorization letter was sent to the Block Educational Office as contended in the version. At the cost of repetition, several facts mentioned in the version are stated by the said witness of the opposite party in the affidavit, but regarding sending of authorization letter, is not stated. Under the circumstances, only inference that has been drawn is, the said witness was not dare enough to tell false on oath in his affidavit. Added to it, the opposite party is a Corporation, which shall have to maintain several records and registers and if really, as contended in the version on 14.09.2007 itself the authorization letter was sent to the employer of the complainant, certainly the opposite party could have produced available records including outward register. For non-production of such available documents, no reasons are assigned by the opposite party. Hence, necessarily adverse inference shall have to be drawn against the opposite party. Consequently, we hold that, as contended in the version by the opposite party on 14.09.2007 it sent the authorization letter to the employer of the complainant, is not proved.<br /> <br /> 10. On the other hand, it is definite and specific case of the complainant that, the opposite party had sent the requisition for deduction of salary to her employer during the month of June - July 2008 and accordingly, the pay disbursing officer deducted and remitted the premium commencing from the month of July 2008. There is no dispute that, from July 2008 the premiums were sent by the employer of the opposite party. If really, well in time or as contended on 14.09.2007 itself, opposite party had sent authorization letter or requisition to the pay disbursing officer of the complainant, naturally, the premium amount could have been deducted and credited to the opposite party.<br /> <br /> 11. It is further contention of the opposite party is that, the complainant has given the authorization letter, stating that she will be responsible for any consequence on account of non-recovery and non-payment of premium. Hence, the complainant could have made arrangement for remitting the premium directly to the opposite party to prevent the policy from going into a lapsed condition. Hence, now, the question would be, what were the obligations on the part of the opposite party and the complainant in respect of the policy availed under salary saving scheme.<br /> <br /> 12. Even though, there are recent decisions of the Hon’ble Apex Court and Hon’ble National Commission, the learned advocate referred and relied upon the orders of the District Forums and of some other State Commissions. Before going to consider the same, we would like to refer the law laid down by the Hon’ble Apex Court and the Hon’ble National Commission.<br /> <br /> 13. Hon’ble National Commission in LIC of India and another Vs. A.Yashodamma and another, reported in II (2009) CPJ 254 has held that, the contention of the LIC of India that as per the authorization given by assured, it was his sole responsibility to pay premium was not accepted. Hon’ble National Commission referred and relied upon decisions of Hon’ble Apex Court and it is relevant to quote paragraph 7 of the judgement, which reads thus-<br /> “We shall first deal with legal aspects, which have bearing in the matter under consideration. The Apex Court in Chariman, LIC and others Vs. Rajiv Kumar Bhaskar, V (2005) SLT 567=JT 2005 (6) SC 416, has considered the entire salary savings scheme. The salient features of the scheme as pointed out by the Apex Court are: the scheme is accomplished by savings automatically deducted from the pay of the employees to be remitted to LIC every month; each employee owns his policy individually; the responsibility for collection of premium by deducting the same from the salary of the employee and making over the same to Corporation is that of the employer; the employer thus accepts the sole responsibility to collect the premium from its employees and remit the same by means of one cheque to the Corporation; provisions are made for in the event of the life assured leaving employment, etc. In the cases before the Apex Court for one reason or the other, the employer did not deduct the premium from the salary of the concerned employee. The Apex Court also noted that the salary savings scheme provides for a tripartite arrangement; the Corporation did not issue any receipt of individual premium or premium due notice and the entire responsibility was thrust upon the employer by the Corporation; keeping in view the facts that Corporation did not make any offer to the employees nor would directly make any communication with them regarding payment or non-payment of the premium or any other matter in relation thereto or connected therewith including the lapse of the policy, if any, it could not be said that employer had no role to pay on behalf of the Corporation; that so far as employees are concerned, they could not approach the insurer directly and, thus, for all intent and purport they were to treat their employers as ‘agents’ of the Corporation; the scheme clearly and unequivocally demonstrates that not only the contract of the insurance was entered into by and between the employers and the insurer through the employer but even the terms and conditions of the policy were to be performed had reason to believe that his employer was acting on behalf of the Corporation, a contract of agency may be inferred. The Apex Court emphasized that even in case of non-payment of premium for any reason whatsoever, in view of the object the Scheme seeks to achieve, it was the duty of the insurer to inform the employee about the consequences of non-receipt of such premium from the employer and the Corporation and failed or neglected to do so. It was further pointed out by the Apex Court that in terms of the scheme, significantly the employee for all transactions was required to contact his employer only and as such the Corporation could not be permitted to take a different stand so as to make the employee suffer the consequences emanating from the default on the part of the employer. It was further pointed out that if for some reasons, the employer is unable to pay the salary to the employees, as for example, its financial constraints, the employee may be held to have a legitimate expectation to the effect that his employer would at least comply with its solemn obligations. Therefore, such obligation having been undertaken to be performed by the employer at the behest of the Corporation as its agent having the implied authority therefore, the Corporation cannot be permitted to take advantage of its own wrong as also the wrong of its agent and in any event the employer was obligated to inform the employee that for some reason he is not in a position to perform his obligation whereupon the latter could have paid the premium directly to the Corporation.”<br /> <br /> 14. From the facts and the evidence on record, further it is clear that, neither the employer nor the opposite party ever informed the complainant that the premiums were not paid and the consequences of non-payment of the premiums. The Hon’ble Rajasthan State Commission in LIC and another Vs. Kamesh and another reported in II (2009) CPJ 398 has held that, the LIC is duty bound to inform the employee about consequence of non-receipt of premium from the employer and being principle liable for act of the agent (employer) and the LIC held liable to make payment under the policy. On the same point, there are series of decisions, which needs no repetition.<br /> <br /> 15. Advocate for the opposite party has relied on the order of the District Consumer Disputes Redressal Forum, Bangalore (Urban) in CC 804/08 dated 30.05.2008. In that case, the complainant was on medical leave without salary and hence, premium was not deducted from the salary and for that reason premiums were not credited to the LIC. Such are not the facts of the case on hand. In 8th paragraph of the order, the Forum has also observed that, the complainant was unauthorized absent for particular period and hence, her salary was not drawn and premium was not deducted. It is true, under such facts and circumstances, our Hon’ble State Commission in Appeal No.1251/08 by the order dated 17.10.2008 has confirmed the order of the District Forum. But, in the case on hand, it is not the contention of the opposite party that, in spite of the employer of the complainant having received intimation or requisition regarding deduction and remittance of the premium, has not deducted and remitted the premiums pertaining to the policy of the complainant. Hence, said order is of no use for the opposite party. Another decision in Regional Manager, LIC Vellur Vs. D.Rapical Mary in Appeal No.1662/97 dated 08.01.2004 on the file of Hon’ble State Commission, Chennai is relied upon. In that case also, husband of the complainant was assured, fell sick and for that reason, pay was not claimed and consequently, premiums were not paid. In the body of the order with reference to the facts of that case, it is found by the Hon’ble State Commission that for considerable length of period, the assured fell sick and they did not claim his salary. As noted above, such are not facts of the case on hand. One more decision in FA No.706/97 between Thammina Vs. LIC of India before the Hon’ble A.P.State Commission, Hyderabad dated 23.10.2001 is relied upon. Again, in this case also, the life assured reported sick and hence, premiums were not deducted and remitted to the LIC. Lastly, the learned advocate relied on the order in appeal No.1549/97 dated 07.08.2002 before Hon’ble Maharastra State Commission. The complainant assured in that case was transferred by his employer to a place Jalana to which the salary saving scheme was not made applicable by the LIC and consequently, remittance of premium was not made. Such is also not the fact of the case on hand. Hence, we are of the considered opinion that, the decisions relied upon by the learned advocate for the opposite party are not at all helpful to the opposite party.<br /> <br /> 16. Consequently, in view of the law laid down by the Hon’ble Apex Court and Hon’ble National Commission quoted here before, the contention of the opposite party that as per the authorization letter given by the complainant, it was her sole responsibility to pay premium, cannot be accepted. Obligation on the part of the opposite party was firstly to send the said authorization letter to the employer of the complainant well in time and secondly, if at all for any reason, premium was not deducted and remitted by the employer, then in such case, the employer also being the agent of the opposite party, could have been held responsible and thirdly, further obligation was on the part of the opposite party to inform the complainant that, the premiums for particular period were not paid and consequence there of. Hence, under the circumstances, there is utter negligence and deficiency in service on the part of the opposite party.<br /> <br /> 17. Advocate for the opposite party submitted that, the complainant could have verified with the opposite party regarding the status of the policy and having not done so, the complainant herself is negligent. In this regard, it is submitted for the complainant that, even though proposal was submitted on 28.08.2007 along with two months advance premium, in fact the complainant received the policy bond only for the month of June 2008. The opposite party has denied the said claim of the complainant. It has stated that, the policy was received by the complainant soon after completion of the policy through the agent. But, when the policy was completed and when it was handed over to the complainant, is not explained. In the absence of evidence in support of the said contention of the opposite party, the claim of the complainant, shall have believed. Also, it is relevant to note that, the opposite party must have documents as to when the policy was completed and when it was handed over either to the complainant or to the agent, but no documents are produced by the opposite party. No reasons are assigned. In view of these facts, the complainant has no occasion to approach the opposite party to ascertain the status of the policy. For the complainant, it is claimed that, since she had given authorization letter to the opposite party for deduction of the premiums from her salary she was under the impression that in the usual course, the salary was being deducted and credited to the opposite party and her policy was alive. Considering these facts, the submission of the complainant cannot be brushed aside. <br /> <br /> 18. Advocate for the complainant with reference to the evidence on record, pointed out the conduct and the attitude of the opposite party in the matter. It is true that along with the proposal, the complainant had paid two advance premiums and admittedly as stated in the version, the assured was covered with the risk for the month of August and September 2007. The opposite party thereafter did not collect the premiums from the employer of the complainant sending the requisition as per the authorization letter. As noted here before, the requisition was sent by the opposite party to the employer of the complainant only during June – July 2008. On the basis of said requisition, the employer of the complainant deducted the premiums and remitted the same to the opposite party. The opposite party contend that, it did not receive premium from October 2007 to June 2008 and as such, the policy remained in lapsed condition. But, admittedly thereafter opposite party received the premiums for the months of July 2008 to October 2009 for a period of 11 months. If at all for non-receipt of premium as contended the policy had remained in lapsed condition, the opposite party ought not to have received the subsequent months premium or atleast informed the same to the complainant. In spite of the fact as contended, the policy had remained in lapsed condition, the opposite party went on receiving the subsequent premiums.<br /> <br /> 19. The complainant received a register post from opposite party containing a cheque for Rs.5,632/- on 08.06.2009. It is important to note that, though the cheque is dated 31.03.2008, it was sent by the opposite party along with covering letter dated 25.05.2009. In fact, that was posted on 05.06.2009 and the complainant received it on 08.06.2009. The cheque was valid for a period of three months only. These admitted facts further establish negligence on the part of the opposite party and also it’s attitude towards the complainant.<br /> 20. Now, we have to consider how the opposite party went on bargaining with the complainant. As noted in the above paragraph, the opposite party sent cheque for Rs.5,632/- only. The complainant immediately thereafter contacted her employer to ascertain the details of the premiums deducted and remitted and coming to know of the fact that the requisition was sent by the opposite party only in the month of June – July 2008, she approached the opposite party through a letter and at that time, opposite party expressed it’s inability to furnish details stating that, the file was with some other branch. Then, the complainant herself approached the concerned branch for transfer of the file. As she did not receive any intimation from the opposite party, again she wrote to the opposite party and also approached personally, but did not receive the details. Hence, the complainant returned the cheque referred to above to the opposite party and after much delay on 19.08.2009, the opposite party informed the complainant that policy was in lapsed condition and the premium amount of Rs.9,856/- is in deposit and she was called upon to visit the office of the opposite party. Then ultimately, the complainant issued legal notice stating that in fact she has in all paid 13 months premium amounting to Rs.18,304/-. Then, the opposite party sent a cheque for Rs.15,488/- being the premium amount for 11 months only. As noted above, at the cost of repetition, initially the opposite party offered Rs.5,632/- and then Rs.9,856/- and thereafter Rs.15,488/-. This is how the opposite party bargained with the complainant in the matter. But, for the said offer of the opposite party, the complainant did not accept it, because, advance premium of two months was not offered by the opposite party. Hence, the complainant ultimately filed the present complaint. <br /> 21. It is relevant to note, the observations made by the Hon’ble Apex Court, which reads as under:-<br /> <br /> <br /> <br /> “We therefore, come straightway to the legal issue involved in these appeals. But before doing so and examining the question of jurisdiction of the District Forum, or State or National Commission to entertain a complaint under the Act, it appears appropriate to ascertain the purpose of the Act, the objective it seeks to achieve and the nature of social purpose it seeks to promote as it shall facilitate in comprehending the issued involved and assist in construing various provisions of the Act effectively. To begin with the preamble of the Act, which can afford useful assistance to ascertain the legislative intention, it was enacted, ‘to provide for the protection of the interest of the consumer’. Use of the word ‘protection’ furnishes key to the minds of the makers of the Act. Various definitions and provisions which elaborately attempt to achieve this objective have to be construed in this light without departing from the settled view that a preamble cannot control otherwise plain meaning of a provision. In fact, the law meets long felt necessity of protecting the common man from such wrongs for which the remedy under ordinary law for various reasons has become illusory. Various legislations and regulations permitting the state to intervene and protect the enforcement machinery either does not move or it moves ineffectively, inefficiently and for reasons which are not necessary to be stated. The importance of the Act lies in promoting welfare of the society by enabling the consumer to participate directly in the market economy. It attempts to remove the helpless of a consumer which he faces against powerful, business, described as, a network of rackets or a society in which, the producers have secured power to ‘rab the rest’ and the might of public bodies which are degenerating into storehouses of inaction where papers do not move from one desk to another as a matter of duty and responsibility but for extraneous consideration leaving the common man helpless, bewildered and shocked. The malady is becoming so rampant, widespread and deep that the society instead of bothering, complaining and fighting against it, is accepting as part of life. The enactment is these unbelievable yet harsh realities appears to be a silver lining, which may in course of time succeed in checking the rot.”<br /> 22. If the poor complainant without protest, ignoring her right, had accepted the amount offered by the opposite party, for the first time, the opposite party could have enriched itself. Since, the complainant agitated her rights, the opposite party made second offer enhancing the amount to Rs.9,856/-. Again, the complainant protested the said offer, stating that in fact she had paid premium for 13 months. Then, third offer was made for Rs.15,488/-. But, that is also not the entire premium amount that, the complainant has paid or the opposite party received. In spite of the negligence on its part, the opposite party still intend to deny the genuine and bonafide claim of the complainant, prior to filing the complaint and even after the complaint, is contesting on the grounds without substance particularly put forth false contention that in fact the requisition for deduction of premium was sent to the pay disbursing officer of the complainant on 14.09.2007 itself. But, it is false and in correct. Further, as noted here before, there is well settled legal position on the point of collection of the premiums under the salary savings scheme and in spite of it, the opposite party has set up a defence finding fault with the complainant. On perusal of the law journals, pertaining to consumer disputes, we find number of decisions in respect of salary saving scheme, in which the LIC of India having money power fought the disputes up to the highest courts, in spite of the fact that, there is settled legal position on the point. Poor consumer may not be able to defend the case up to highest court for various reasons. At the cost of repetition, if the complainant without protest had received the initial amount offered, the opposite party could have enriched itself substantially. Under the circumstances, we feel it just to award heavy compensation, with a view that, the opposite party may not repeat such negligence on it’s part and avoid similar deficiency in service hereinafter pertaining to other customers. At the same time, we would like to note that, the public money cannot be used for payment of the compensation for the negligence on the part of the employee of the opposite party. Hence, the LIC of India shall hold enquiry into the matter regarding the negligence and the person/s responsible and collect the said compensation amount from the particular officer / officers. In this regard, we would like to mention the observations made by the Hon’ble Apex Court in the ruling reported in I (1994) CPR 569, which reads as under:-<br /> “Today the issue thus is not only of ward of compensation but who should bear the brunt. The concept of authority and power exercised by public functionaries has many dimensions. It has undergone tremendous change with passage of time and change in socio-economic outlook. The authority empowered to function under a Statute while exercising power discharges public duty. It has to fact to subserve general welfare and common good. In discharging this duty honestly and bonafide loss may accrue to any person. And he may claim compensation which may in circumstances be payable. But where the duty is performed capriciously or the exercise of power results in harassment and agony then the responsibility to pay the loss determined should be whose? In a modern society no authority can arrogate to itself the power to act in a manner which is arbitrary. It is unfortunate that matters which require immediate attention linger on and the man in the street is made to run from one end to other with no result. The culture of window clearance appears to be totally dead. Even in ordinary matters a common man who has neither the political backing nor the financial strength to match the inaction in public oriented departments gets frustrated and it crodes the credibility in the system. Public administration, no doubt involves a vast amount of administrative discretion which shields the action of administrative authority. But where it is found that exercise of discretion was malafide and the complainant is entitled to compensation for mental any physical harassment then the officer can no more claim to be under protective cover. When a citizen seeks to recover compensation from a public authority in respect of injuries suffered by him for capricious exercise of power and the National Commission finds it duly proved then it has a statutory obligation to award the same? It was never more necessary then today when even social obligations are regulated by grant of statutory powers. The test of permissive form of grant are over. It is now imperative and implicit in the exercise of power that it should be for the sake of society. When the Court directs payment of damages or compensation against the State the ultimate sufferer is the common man. It is the tax payer’s money which is paid for inaction of those who are entrusted under the Act to discharge their duties in accordance with law. It is, therefore, necessary that the Commission when it is satisfied that a complainant is entitled to compensation for harassment or mental agony or oppression which finding of course should be recorded carefully on material and convincing circumstances and not lightly, then it should further direct the department concerned to pay the amount to the complainant from the public fund immediately but to recover the same from those who are found responsible for such unpardonable behaviour by dividing it proportionately where there are more than one functionaries.”<br /> 23. Considering the facts, evidence and the discussion made here before, the complainant has proved deficiency in service on the part of the opposite party and accordingly, our finding is partly in affirmative.<br /> <br /> 24. Point No. 2:- Considering the discussion made above and conclusion arrived at, we pass the following order:- <br /> <br /> ORDER<br /> <br /> 1. The Complaint is partly allowed.<br /> 2. The opposite party is hereby directed to refund the entire premium amount of Rs.18,304/- along with interest at the rate of 10% p.a. from the respective dates of receipts of the premiums till realization, within a period of 60 days from the date of the order.<br /> 3. Further, the opposite party is hereby directed to pay a compensation of Rs.1,00,000/- within 60 days from the date of the order and on failure, the amount shall carry interest at the rate of 10% p.a. and out of the said compensation amount, only Rs.25,000/- shall be paid to the complainant with proportionate interest and remaining amount of Rs.75,000/- shall be credited to the Legal Aid Account of this Forum.<br /> 4. Also, the opposite party to pay Rs.2,000/- towards the cost of the proceedings to the complainant.<br /> 5. Give a copy of this order to each party according to Rules.<br /> (Dictated to the Stenographer, transcribed by her, transcript revised by us and then pronounced in the open Forum on this the day 18th December 2009)<br /> <br /> <br /> <br /> <br /> (A.T.Munnoli) <br /> President <br /> <br /> <br /> (Y.V.Uma Shenoi)<br /> Member<br /> <br /> <br /> (Shivakumar.J.)<br /> Member<br /> <br /> <br /> <br /> <br />