Tamil Nadu

South Chennai

CC/190/2021

E. Kavitha - Complainant(s)

Versus

M/s. HDB Financial Services, LTd., REp by its Director, and 5 others - Opp.Party(s)

M/s. K.A.Rama Krishnan

06 Mar 2023

ORDER

                                           Date of Complaint Filed : 30.09.2021

                                           Date of Reservation      : 17.02.2023

                                           Date of Order               : 06.03.2023

DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION,

CHENNAI (SOUTH), CHENNAI-3.

 

PRESENT:    TMT. B. JIJAA, M.L.,                                                 : PRESIDENT

                        THIRU. T.R. SIVAKUMHAR, B.A., B.L.,                :  MEMBER  I 

                        THIRU. S. NANDAGOPALAN., B.Sc., MBA.,         : MEMBER II

 

CONSUMER COMPLAINT No.190/2021

                                            MONDAY, THE 6th DAY OF MARCH 2023                                                      

Mrs.E.Kavitha,

W/o. Late.R.Selvam,

S.K. Store,

No.12/259, S.V.Nagar,

Senneerkuppam,

Poonamallee,

Chennai - 600 056.                                                                                                                             ... Complainant                

..Vs..

 

1.M/s. HDB Financial Services, Limited,

   Rep. by its Director,

   Registered Office at

   Radhika, 2nd Floor, Law Garden Road,

   Navrangpura,

   Ahmedabad-380 009.

 

2.M/s. HDB Financial Services, Limited,

   Rep. by its Director,

   Corporate Office at

   Ground Floor, Zenith House,

   Keshavrao Khadye Marg,

   Mahalakshmi, Mumbai,

   Maharashtra - 400 034.

 

3.M/s. HDB Financial Services, Limited,

   Rep. by its Director,

   No.68/2, Murugappa Naicker Office Complex,

   Loyal Tower, Greams Road,

   Thousand Lights, Chennai - 600 006.

 

 

4.M/s. HDB Financial Services, Limited,

   Rep. by its Director,

   Mangadu Branch,

   No.52-A, 1st Floor, Kamaraja Nagar,

   Mangadu Main Road,

   Kumananchavadi, Chennai - 600 056.

 

5.M/s. HDFC Life Insurance Company Limited,

   Rep. by its Director,

   Registered Office,

   Lodha Excelus, 13th Floor, Apollo Mills Compound,

   N.M. Joshi Marg, Mahalaxmi, Mumbai- 400 011.

 

 

6.M/s. HDFC Life Insurance Company Ltd.,

   Rep. by its Director,

   Communication Office & Claims Review Committee,

   Lodha Excelus, 11th Floor, Apolla Mills Compound,

   N.M Joshi Marg Mahalaxmi,

   Mumbai – 400 011.                                                                                                            ...  Opposite Parties

 

******

Counsel for the Complainant                   : M/s. K.A Ramakrishnan

Counsel for the 1st to 4th Opposite Parties : M/s. Nathan and Associates

Counsel for the 5th & 6th Opposite Parties : Exparte

 

On perusal of records and after having heard the oral arguments of the Counsel for the Complainant and having treating the written arguments as oral arguments of Opposite Parties 1 to 4 on endorsement made by the Counsel for the Opposite Parties 1 to 4, we delivered the following:

 

ORDER

Pronounced by the President Tmt. B. Jijaa, M.L.,

1.      The Complainant has filed this complaint as against the Opposite Parties under section 35 of the Consumer Protection Act, 2019 and prays to direct the Opposite Parties to pay a sum of Rs.57,14,737.84 being the Death claim of the Complainant and settle the entire loan amount to the 1st Opposite Party under Loan Account NO.5483619 dated 29.10.2018 and direct the 1st Opposite Party to cancel the Memorandum of Deposit of Title Dees in respect of the schedule mentioned property and return the title deeds of the Complainant and directing the Opposite Parties jointly and severally to pay a sum of Rs.30,00,000/- towards compensation for unfair trade practice and deficiency in service and direct the 1st Opposite Party to return a sum of Rs.7,90,461/- already paid through EMIs by the deceased husband of the Complainant along with cost.

2.     The averments of Complaint in brief are as follows:-

The Complainant’s husband Late.R. Selvam was running a provision store in the name and style of M/s. S.K.Store as proprietorship for the purpose of developing his business, he availed a loan from the Opposite Parties in the name of M/s. S.K.Store as borrower. To secure the above said loan, the Complainant's husband Late.R.Selvam created a mortgage by deposit of title deeds in respect of his immovable property situated at No.12, S.V. Nagar, Senneerkuppam, Poonamallee, Chennai - 600 056. The 1st  Opposite Party has sanctioned loan amount of Rs.46,94,839/- with an interest of 12% per annum under a Sanction letter dated 29.10.2018, bearing Loan Account No.5483619. The mode of repayment schedule is Rs.67,357/- EMIs for 120 months. The above mentioned loan amount includes credit Protect Insurance i.e., the Opposite Parties have also included the insurance premium amount to insure the loan in the name of Credit Protect Insurance under Insurance Policy bearing No.PP000239 for a period of 10 years from 01.11.2018 to 31.10.2028. For the insurance Policy a sum of Rs.12,579/- was taken towards HDFC Ergo Premium and a sum of Rs.1,94,839/- was taken towards HDFC Slic Credit Protect Plus totaling Rs.2,07,418/- has been taken and the Policy bearing No.PPO00239 was issued on 01.11.2018 under Group Credit Protect Plus Plan towards death benefit (to protect their loan from damage of the building, loss of business and also against the life of the borrower (the Complainant's husband). Under the above said Insurance Policy the sum assured was Rs.44,74,646/-. The Complainant's husband was very prompt in payment of every EMI within due date and there was no default. During course of time, the Complainant's husband fell ill due to Dengue Fever during November, 2019 and he was admitted at Sri Ramachandra Hospital, Porur on 08.11.2019 and he died on 10.11.2019 due to Dengue Fever. Even after the death of the borrower, the Complainant has paid 3 EMIs by mobilizing funds with great pain upto January, 2020. The Complainant had approached the 6th Opposite Party Insurance Company and submitted the death claim through the above said Insurance Policy to settle the remaining loan amount to the 1st Opposite Party. The 6th Opposite Party's Claims Review Committee on 12.01.2021, rejected the death claim of the Complainant on flimsy ground without showing the terms and conditions of the policy.  After  rejecting  the  death claim  by  the  6th  Opposite Party,  the 3rd   Opposite Party  sent a Notice dated  06.07.2021  under  Section  13(2)  under SARFAESI Act, 2002 to the Complainant claiming to repay a sum of Rs.57,14,737.84 as outstanding of the above said loan, which is arbitrary as against law. The Complainant gave a reply to the above said notice by a reply notice dated 20.07.2021 and also asking the copy of the Insurance Policy bearing No.PPO00239 dated 01.11.2018. It is the duty of the Insurance Company to issue the Policies Insured for the above said loan. One is for the property and another one is for the life of the borrower (husband of the Complainant). The 5th Opposite Party Insurance Company has not sent a copy of the Insurance Policy form of the Complainant's husband and also the Policies with terms and conditions till date. It also amount to deficiency of service on the part of the 5th and 6th Opposite Parties. Hence the above Complaint.

3. Written Version filed by the 3rd Opposite Party and on behalf of the 1st, 2nd, & 4th Opposite Parties in brief are as follows:-

The 3rd Opposite Party submitted that M/s HDB Financial Services Ltd., has sanctioned loan amount of Rs.46,94,839/- with the interest of 12% per annum to the Complainant under a Sanction Letter dated 29.10.2018 bearing the Loan account No.5483619 with the mode of repayment schedule as Rs. 67,357/- EMIs for 120 months towards payment of principal and interest and the payment date is 4th of every English calendar Month. The Complainant's Husband had availed loan amount with the Mortgage of the Sale Deed of the property and also availed the Group Credit Protect Plus sum from the 5th and 6th Opposite Party. The Complainant hasn't made the EMI payment for the above availed loan from the month February 2020. Wherein the same has been intimated to them several times, but however the Complainant had not bothered to settle the same or reply to the payment of the EMI. The 1st Opposite Party further submitted that despite of taking all possible proper measures from their side, there was still no response from the side of the Complainant. The non- approval of the insured amount of the Loan is a pending matter between the Complainant and the 5th and 6th Opposite Party wherein the Opposite Parties 1 to 4 are in no way binded to it. It is further submitted that the 1st Opposite Party holds no hand in their insurance Agreement and are nowhere related to that matter.  Further submitted that the 1st to 4th Opposite Parties are not a sister company to 5th  and 6th Opposite Party. Further it is pertinent to add that they are individual finance institutions incorporated to operate separately as a separate entity. They have no concern over the insurance claim and further stated that it is the due duty on the part of the Complainant to pay the EMI and the loan amount on time. It is submitted that the Doctrine of Indemnity cannot be used by the Complainant as a shield to protect oneself to run away from their responsibility. Further the principle can come into force only when the claim of insurance is approved by the 5th and 6th Opposite Party in repaying the loan amount. Since the same is not approved for the grounds not disclosed, the Complainant is bound to make the payment of EMI and loan amount to the 1st Opposite Party. The 3rd Opposite Party formulated a due process which would be undertaken by any financial institution in case of default of repayment of EMI or loan amount from the defaulter and the same must not be exaggerated as threatening or any other illegal activities by the Complainant. Hence prayed to dismiss the complaint.   

  

4. The Complainant submitted her Proof Affidavit and Written Arguments. On the side of the Complainant, documents were marked as  Ex.A-1 to Ex.A-16.  The 1st to 4th Opposite Party submitted their Proof Affidavit and Written Arguments. On the side of 1st to 4th Opposite Party no document was marked. The 5th and 6th Opposite Parties did not appear before this Commission even after sufficient notice was served on them. Hence 5th and 6th Opposite Parties was called absent and set exparte, on 07.12.2021.

5.     Points for Consideration:-

1. Whether there is deficiency in service on the part of the Opposite Parties?

2. Whether the Complainant is entitled for reliefs claimed?

3. To what other reliefs the Complainant is entitled to?

Point No.1:

6.   The admitted facts are that the Complainant’s husband late R.Selvam who was running provision store in the name of S.K.Store had availed loan from the 1st Opposite Party for the purpose of his business. The 1st Opposite party had sanctioned a sum of Rs.46,94,839/-  with  interest  at  the rate of

12% p.a, vide sanction letter dated 29.10.2018, Ex.A1. The Complainant had also entered into Loan Agreement with the 1st Opposite Party bearing Loan Agreement No.5483619. The Loan amount had to repaid in 120 months by an equated monthly instalments of Rs.67357/-. As a security for the said loan the husband of the Complainant had created mortgage of his property executing the Mortgage by deposit of title deeds, dated 28.11.2018 Ex.A-5 in respect of immovable property situated at No.12, S.V.Nagar, Senneerkuppam, Poonamallee, Chennai – 600 056. It is also not in dispute that the loan amount is insured with the 5th and 6th Opposite Parties and a sum of Rs.12,579/- is paid towards HDFC Ergo Premium and a sum of Rs.1,94,839/- is paid towards HDFC Slic Credit Protect Plus. The insurance policy availed from the 5th Opposite Party protects from damage of the property loss of business and life of the borrower who is the husband of the Complainant. It is also not in dispute that the Complainant’s husband had paid monthly instalments until his death on 10.11.2019.

     The dispute arose when the 5th and 6th Opposite Parties rejected the death claim of the Complainant which amount ought to have been adjusted towards the loan outstanding to the 1st Opposite Party .

       The Contention of the Complainant is that even after the death of her husband the Complainant paid 3 EMI by mobilizing funds with great difficulty upto January 2020. She had approached the 6th Opposite Party and submitted death claim in respect of the said insurance Policy, which was rejected by the 6th Opposite Party on 12.01.2021. Further contended that, after rejection of claim by the 6th Opposite Party, the 3rd Opposite party had sent a notice dated 06.07.2021 under section of 13(2) of the SARFAESI, Act, 2002 to the Complainant claiming to pay a sum of Rs.57,14,737.84 as outstanding due in the said loan for which the Complainant had sent a reply notice dated 20.7.2021 and also sought for copy of Insurance policy which was not provided to her.

     The Opposite Parties 1 to 4 contended that having availed loan from them by mortgaging the property and also availing group credit protect insurance from the 5th and 6th Opposite Party the Complainant had failed to make EMI payments from February 2020 and the non approval of the insured amount of the loan is the dispute between the  Complainant and Opposite party 5 and 6 which they are not concerned. Further submitted that they could not return the memorandum of deposit of title deeds until the entire payment is made towards the loan and that they are not barred from sending notice under the SARFAESI ACT.

        A perusal of Ex.A-10 shows that insurance policy bearing No.PP000239 under the Group credit protect plus was issued covering life of (Late) Mr.Ramadurai Selvam husband of the Complainant for a assured sum of Rs.44,74,646/- towards death benefits. The death claim was rejected by the 6th Opposite Party on the ground that Complainant’s husband was suffering from Diabetes which is prior to issuance of the policy which fact was suppressed by the Complainant’s husband and had this information provided they would have called for further medical questionnaires and based on the report that they would decided to offer insurance cover.

      It is pertinent to note that a perusal of the death summary would reveal that the husband of the Complainant who was apparently normal 4 days before 08.11.2019 while admitting in Sri Ramachandra Medical Centre, after which he developed fever and was diagnosed to have dengue with thrombocytopenia due to which he died on 10.11.2019. The fact that late R.Selvam husband of the Complainant was suffering from diabetes is true.

           The Hon’ble National Consumer Disputes Redressal Commission as relied by the Complainant in Neelam Chopra Vs Life Insurance Corporation of India by its order dated 08.10.2018 reported in IV (2018) CPJ 321 (NC) has held that non disclosure of information in respect of life style disease of diabetes will not totally disentitle the Complainant from claiming Insurance amount and that repudiation of claim was not justified which is applicable to the present case.

     Further the Opposite Parties 1 to 4 submitted that they are separate legal entities and that the 5th and 6th Opposite Parties have their norms and rules regarding the insurance policies which is in no way connected to the 1st to 4th Opposite parties and that rejection of the claim is between the Complainant and the 5th and 6th Opposite Parties which will not bind the 1st to 4th Opposite Parties. The 1st to 4th Opposite Parties relied on the order dated 15.02.2021 passed by the Hon’ble SCDRC, Punjab, Chandigarh in F.A. No.665 of 2019 wherein it was held that there was  no deficiency in service on the part of HDB Financial services because the loan amount was insured with HDFC Standard life . Also relied upon the order dated 21.02.2019 passed by the Hon’ble SCDRC, Punjab, Chandigarh in CC. No.946/2017 where it was held that only insurance company is liable to pay the insurance claim.

        In view of the above discussions and perusal of documents it is clearly established that the cause of death is due to “Acute Febrile illness with severe Thrombocytopenia”, after diagnosing dengue fever which was not existing at the time of taking insurance policy. There is no suppression of material information in respect of the disease, which is the main cause of death. Moreover in view of the order passed by the Hon’ble NCDRC in Neelam Chopra Case cited above the non-disclosure of life style disease of diabetes will not disentitle the Complainant from claiming the insurance amount. Therefore the Complainant is entitled to the insurance Claim. The repudiation of the insurance claim of the Complainant by the Opposite Parties 5 and 6 amounts to deficiency in service.

        As the loan availed by the Complainant’s husband from HDB financial services is insured with Opposite Party 5 and 6 by payment of premium as seen from Ex.A-2 and Ex.A-10 assuring a sum of Rs.44,74,646/- towards death benefit and as the insured died during the subsistence of the insurance policy the Opposite Party 5 and 6 are liable to pay the insurance claim. Rejection of the death claim of the Complainant by Opposite Parties, 5 and 6 amounts to deficiency on their part. As the 1st to 4th Opposite Parties have no role on the insurance claim submitted by the Complainant to the 5th and 6th Opposite Party there is no deficiency on the part of Opposite Parties 1 to 4. Accordingly point No.1 is answered.

Point Nos.2 and 3:

As discussed and decided Point No.1 against the Opposite Parties, the Opposite Parties 5 and 6 are jointly and severally liable to pay a sum  Rs.44,74,646/- being the sum assured towards the death claim of the insured  with interest at the rate of 12% p.a from the date of rejection of the claim till the date of realization and to pay a sum of Rs.25,000/- towards deficiency in service along with a sum of Rs.5,000/-.  Accordingly Point Nos. 2 and 3 are answered. 

In the result, the complaint is allowed in part. The Opposite Parties 5 & 6 are jointly and severally  directed to pay a sum of Rs.44,74,646/- (Rupees Forty Four Lakhs Seventy Four Thousand Six Hundred and Forty Six Only)  being the sum assured towards the death claim of the insured with interest at the rate of 12% p.a from the date of rejection of the claim till the date of realization and to pay a sum of Rs.25,000/- (Rupees Twenty Five Thousand Only) towards deficiency in service along with a sum of Rs.5,000/- (Rupees Five Thousand Only) towards cost of the litigation to the Complainant, within 8 weeks  from the date of receipt of the order, till the date of realization. The complaint as against Opposite Parties 1 to 4 stands dismissed.                                                                                                                                                                                                                                                                                                                                                                                                                

          In the result this complaint is allowed.          

Dictated to Steno-Typist, transcribed and typed by her, corrected and pronounced by us in the Open Commission, on 6th of March 2023.

 

 

S. NANDAGOPALAN               T.R. SIVAKUMHAR                 B.JIJAA

         MEMBER II                       MEMBER I                        PRESIDENT

 

List of documents filed on the side of the Complainant:-

 

Ex.A1

29.10.2018

Loan sanction letter under loan account No.5483619

Ex.A2

22.11.2018

Loan disbursement letter

Ex.A3

22.11.2018

Repayment schedule

Ex.A4

22.11.2018

Loan agreement

Ex.A5

28.11.2018

Memorandum of Deposit of Title Deeds

Ex.A6

10.11.2019

Death report of complaint husband

Ex.A7

12.11.2019

Death summary of Complainant husband

Ex.A8

19.11.2019

Death certificate of Complainant husband

Ex.A9

10.02.2020

Legal heirship certificate of Complainant husband

Ex.A10

12.01.2021

Rejection letter of Group Claim Reconsideration request by the 6th Opposite Party

Ex.A11

25.06.2021

Rejection letter of Group claim Reconsideration request by the 6th Opposite Party

Ex.A12

06.07.2021

Section13(2) notice from the 1st Opposite Party

Ex.A13

20.07.2021

Reply to section 13(2) notice by the Complainant

Ex.A14

20.07.2021

Loan repayment statement issued by the 1st Opposite Party

Ex.A15

23.07.2021

Loan repayment statement through Complainant’s husband bank account

Ex.A16

 

Terms and conditions of HDFC life Group Credit Protect Plus Insurance Plan

 

List of documents filed on the side of the Opposite Parties:-

 

NIL

 

 

S. NANDAGOPALAN               T.R. SIVAKUMHAR                    B.JIJAA

         MEMBER II                       MEMBER I                         PRESIDENT

 

 

 

 

 

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