JUSTICE AJIT BHARIHOKE (ORAL)

            Naveen Singh Bhandari has filed the instant complaint alleging that he had fixed deposit accounts worth Rs.1.00 crores with OP No.2 Bank.  In April 2008, complainant was approached by OP nos. 3 to 5 ( officials of Op No.1 & 2).  They represented that SBI was offering special fixed deposit scheme for the special customers with assured return of 16% p.a. Believing the representation, the complainant agreed to invest his money in the proposed fixed deposit scheme and signed the filled up application form produced by OP No.4 on 24.04.2008.

2.         It is further alleged that despite of having received Rs.1.00 crore, the opposite parties did not issue the fixed deposit receipt as represented.  Instead OP No. 3 & 4 delivered one “Unit Plus II  Pension, Option I: Pure Pension”  insurance policy to the complainant.  As per the terms and conditions of the policy, the complainant was required to invest Rs.1.00 crore p.a. for a period of five years.  The lock in period for the policy was for three years.  The complainant on realizing that he has been duped into purchasing the insurance policy, visited OP No.2 bank on 13.06.2008 and told OP No.3 to 5 that he was not interested in the said insurance policy.  The complainant thus submitted a written request seeking cancellation of the policy and deposit of cancellation proceeds in his bank account alongwith interest @ 11% for a period of 1 ½ month.

3.         It is further alleged that opposite parties despite of the request dated 13.06.2008 for cancellation of the policy and refund of the money failed to do the needful.  Claiming this to be deficiency in service, the complainant has filed consumer complaint seeking following reliefs:

“A.       The OP No.1 to 5 be directed to return the money belonging to the complainant amounting to Rs.1,00,00,000/- by accepting the policy cancellation request dated 13.06.2008 for the insurance policy number 28024038002 of OP no.1 under its “Unit Plus II Pension, Option I : Pure Pension” alongwith interest.

B.        Any other relief or reliefs in addition to or in lieu thereof which this Hon’ble Commission deems fit and proper may also be awarded in favour of the complainant and against the OPs”.

4.         Opposite parties in their respective written statements have denied the allegations of misrepresentation of fact by OP nos. 3 to 5.  OP No.1 took a plea that no request for cancellation of insurance policy during free look period was received by OP No.1.  It was pleaded that request for cancellation of the policy dated 13.06.2008 was submitted to OP No.2 Bank and on 19.06.2008 the complainant took away the policy bond which was never forwarded to OP No.1 for cancellation.  It was also pleaded that subsequent to submitting request letter dated 13.06.2008 with Op No.2 bank, the complainant withdrew his request for cancellation of policy and showed his inclination to continue with the policy.  Thus, according to the opposite parties, no deficiency in service or unfair trade practice can be attributed to them.

5.         Contesting parties have filed evidence by way of affidavit in support of their contention.  It is pertinent to mention that during the pendency of complaint,  refund value of the policy i.e. Rs. 95,28,344/- has been refunded to the complainant in March 2012 after seeking permission from the Bench.

6.         We have considered the rival contentions and perused the record.

7.         Instant complaint raises two issues : (i)  Whether opposite parties have induced the complainant in purchasing the subject insurance policy by misrepresentation done by OP No.3 to 5 ; (b) Whether the opposite parties insurance company has committed deficiency in service in failing to cancel the insurance policy and refund the premium amount pursuant to free look period being exercised by the complainant vide letter dated 13.06.2008.

8.         As regards issue no. (i), learned counsel for the complainant has referred to the affidavit filed by the complainant in evidence and submitted that from the said affidavit, it is established that complainant was duped by OP No. 3 to 5 into buying the subject insurance policy by representing that he would be issued a fixed deposit receipt carrying 16% interest per annum.  We are not inclined to believe the said affidavit particularly when the opposite parties  have countered the aforesaid allegation of misrepresentation in their respective affidavit evidence.  It is a case of word of the complaint against the word of the opposite parties.  To arrive at the correct conclusion, we have perused the record particularly the proposal form admittedly signed by the complainant.  From the proposal form, it is clear that complainant has described him as a professional advisor for an American Company.  Thus, it is clear that complainant is an educated person. Therefore, it is improbable that he would have blindly accepted such a representation made by OP nos. 3 to 5 and signed the proposal form for purchase of policy without even reading its contents.  Our aforesaid view is fortified by the fact that admittedly, during the free look period, the complainant had approached Branch Manager of OP no.2 Bank with a request letter dated 13.06.2008 for cancellation of policy and refund of premium.  The said letter reads as under:

“Sub:   Cancellation of Insurance Policy No.28024038002 ( Unit Plus II Pension)

Sir,

            Respectfully, I beg to state that I have taken one Life Insurance ( pension) Policy of Rs. One Crore from your Brnach on 02.05.2008.  I am not satisfied with your policy No.28024038002 dt 02.05.2008 for Rs.10000000/- (one Crore) and the same may please be cancelled and the amount of Rs.10000000 ( One Crore) may please be deposited in my account no.0119000999 along with one and half month interest on the above amount @ 11%.  Policy Bond is enclosed herewith for the needful.

            Please acknowledge the receipt.”

9.         On plain reading of the letter, we find that there is no allegation to the effect that OP Nos. 3 to 5 had induced the complainant into purchasing the subject insurance policy by misrepresenting that he was depositing the amount of Rs.1.00 crores in a fixed deposit carrying 16% p.a.  Had the story of misrepresentation been true, as a prudent person, it was expected of the complainant to mention about misrepresentation in the letter dated 13.06.2008 and use it is as the reason for wishing to return the said policy.   As there is no mention of misrepresentation in the said letter, we are convinced that story of misrepresentation has been concocted by the complainant and is not reliable. 

10.       As regards issue no. (b) is concerned, learned counsel for the complainant has taken us through the terms and conditions of the insurance policy particularly the free look clause and submitted that al-though the complainant submitted a written request for cancellation of policy on 13.06.2008, the opposite party have wrongly declined to cancel the policy and refund the money, which amounts to deficiency in service.

11.       In order to appreciate this contention, it would be useful to have a look on Free Look clause of the insurance policy. Relevant clause reads as under:

“20.  Free Look period

“The policy holder has a period of 15 days from the date of the receipt of the policy document to review the terms and conditions of the policy and where the Policy holder disagrees to any of the terms and conditions, he / she has the option to return the policy stating the reasons for his/her objection, when he / she shall be entitled to a refund of the amount in accordance with prevalent law.

Currently, the amount payable on free look cancellation is :

Fund Value + ( Premium Allocation Charges + Mortality Charges, if

Any + Rider Charges, if any + Policy Administration charges) already

Deducted

MINUS (Stamp Duty + Medical expenses, if any)

On free-look cancellations, the units of each Fund will be liquidated at the NAV as follows:

If the request is received before 3.00 pm of any day, - the Closing NAV

Of the same day will be applicable.

If the request is received after 3.00 pm of any day – the Closing NAV of the next working day will be applicable.”

12.       On reading of the above, it is clear that clause 20 of the insurance policy gave a right to the policy holder to exercise his right to seek review of the terms and conditions of the policy or to return the policy stating the reasons for his objection within 15 days of the receipt of the policy documents.  Thus, it is clear that in order to successfully exercise the option for return of the policy and to seek refund, the petitioner was required to return the policy documents alongwith his objections as per the free look period option within 15 days of the receipt of the documents to the insurer.  Undisputedly, no option to return the policy was sent by the petitioner to OP No.1 i.e. the insurance company.  On the contrary, it is admitted case of the complainant that he had submitted his request for cancellation of insurance policy under the free look period clause to Branch Manager SBI Dehradun.  If aforesaid allegations  of the complainant is accepted, then also, the option exercise letter was submitted to Branch Manager SBI Dehradun, who was the employee of State Bank of India, a public sector banking company, which has an entirely different entity from OP No.1 Life insurance company.  Therefore, in our considered view, the submission of option letter to Branch Manager cannot be treated as exercise of free look option in accordance with clause 20 of the terms and conditions of the insurance policy.  There is no evidence on record to show that the option exercise letter dated 13.06.2008 along with the policy reached insurance company within the stipulated period of 15 days from the date of receipt of policy documents by the complainant.  Therefore, OP No.1 was justified in refusing to cancel the policy and refund the money.

13.         So far as OP No.2 is concerned, the complainant has not been able to show any cogent evidence to establish that OP No.2 was deficient in service to the complainant.  As regards Op No.3 to 5, the plea regarding inducing the complainant to purchase the insurance policy by misrepresentation has not been established.

14.       In view of the discussion above, we do not find merit in the complaint.  Complaint is accordingly dismissed, with no order as to costs.