DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION, PALAKKAD

Dated this the 8^th day of May, 2023

Present : Sri.Vinay Menon V., President

             : Smt.Vidya A., Member                       

             : Sri.Krishnankutty N.K., Member         Date of filing: 28/12/2020 

CC/166/2020

Sivankutty

    S/o Mannath Kesavan Nair

    R/o Manath House, Robinson Road

    Palakkad                                                                     -         Complainant                                            

(By Adv. K.Dhananjayan)                         

                                                           V/s

1. M/s HDFC Life Insurance Co. Ltd.

    Reg. Office at Ramon House

    H.T.Parekh Marg, 169 Back Bay

    Reclamation, Mumbai – 400 020

2. M/s HDFC Life Insurance Co. Ltd.

    Reg. Office at Ramon House

    H.T.Parekh Marg, 169 Back Bay

    Reclamation, Mumbai – 400 020

    Rep. by its Managing Director/Authorised Signatory

3. M/s HDFC Life Insurance Co. Ltd.

    Corporate Office at ‘Trade Stare’

    II Floor, ‘A’ Wing Junction of Kondivita

    & M.V.Road, Anderi-Kurla Road

    Anderi (East), Mumbai – 400 059

4. M/s HDFC Palakkad Branch

    II Floor, Udaya Towers, Opp. Rapadi Stadium

    West Fort Road, Palakkad – 678 001

    (Opposite parties 1 to 4 by Adv. Saji Issac.K.J)

5. The Branch Manager

    HDFC Bank Ltd., Railway Station Road

    Palakkad                                                                     -         Opposite parties

    (Ex-parte)

O R D E R

By Smt. Vidya.A, Member

1.  Pleadings of the complainant in brief

      The complainant joined an insurance policy issued by the 1^st opposite party namely HDFC unit Linked Pension II Policy bearing No: 12512874.  The policy commenced on 6^th January 2009 and its tenure was 10 years with annual premium of Rs. 50,000/-

          After the expiry of the said policy i.e. on 24/09/2019, the complainant sent a letter to the 4^th and 5^th opposite parties asking to return the amount of Rs. 50,000/- which he has deposited at the time of joining the policy.  They sent reply stating that they cannot accept the request of the complainant, as the surrender value is none.  They have not paid any amount to the complainant till this time and ought to have returned Rs.50,000/- with nominal interest as the amount is with them for the past 10 years.  The non-returning of the principal amount is an example of unjust enrichment and it is a deficiency in service and unfair trade practice on the part of opposite parties.

      So he approached the Commission to get the following reliefs from the opposite parties

1. To get Rs. 50,000/- being the amount deposited by the complainant with minimum rate of interest from 7^th January 2010,
2. To get a compensation of Rs. 50,000/- for the mental agony and deficiency in service committed by them and Rs. 30,000/- as cost of the litigation.
3. Such other incidental reliefs which the Commission finds fit and proper to grant.

2.   Opposite parties 1 to 4 appeared and filed version.  5^th opposite party did not appear even after receipt of notice.  5^th opposite party’s name was called in open court and was set ex-parte.    

3.   Opposite parties 1 to 4 filed version contending that the complaint is barred by limitation.  The policy of the complainant lapsed due to non-payment of premium due in 2010 and the present complaint filed after a period of 10 years is barred by limitation and hence it is liable to be dismissed.

          The policy availed by the complainant is a unit linked policy and is a speculative investment; so the complainant is not a ‘Consumer’ within the meaning of Consumer Protection Act and it is not maintainable.

          The complainant had joined the HDFC unit Linked Pension II Policy from the opposite parties based on the proposal form and had opted for the payment interval of the policy.  He after having paid the premium along with the application, failed to pay the subsequent premiums.  The policy was for a term of 10 years with an annual premium of Rs. 50,000/-  The complainant accepted the policy after agreeing the Terms & Conditions of the policy and he had a further option to return the policy within a period of 15 days on receipt of it.

          The opposite parties have not accepted any amount from the complainant as deposit and the amount as admitted by the complainant was paid as premium towards policy.  Premium paid by the insured to the insurance company cannot be considered as deposit and is not entitled to any interest.

          Contract of insurance is based on its terms and conditions and are binding on the parties.  If the premium remains unpaid, the policy will lapse and the unutilized fund value at the date of lapse less the surrender charge and other charges as specified in the policy will be paid to the policy holder.  Since the complainant did not pay the premium payable on the 1^st anniversary, the surrender charge is 100% of the fund value and hence no amount is payable according to the policy conditions.  The opposite party intimated this to the complainant by letter dated 07/05/2019.  The policy lapsed only due to the default of complainant himself and the complainant is not entitled to the reliefs claimed.  Hence the complaint has to be dismissed with cost of the opposite parties.  

4.   From the pleadings of both parties, the following points arise for consideration

1. Whether the complainant is a Consumer under the Consumer Protection Act and the complaint is maintainable?
2. Whether the complainant is barred by limitation?
3. Whether the opposite parties are justified in refusing repayment of premium/accruals thereon?
4. Whether there is deficiency in service on the part of opposite parties?
5. Whether the complainant is entitled to the reliefs?
6. Reliefs if any as cost and compensation.

5.   Complainant filed proof affidavit and Exts. A1 to A6 marked from his side.  Opposite parties 1 to 4 also filed proof affidavit and Exts. B1 and B2 marked from their sides.  Marking of both documents are objected to on the ground that they are photocopies.  In the absence of any allegation that the documents marked on the side of opposite parties are forged or concocted, we find no merit in the objection. 

6.  Point No: 1    

      Opposite parties in their version contended that since the policy availed by the complainant is a unit linked policy and is a speculative investment, the complainant is not a Consumer within the meaning of Consumer Protection Act.

          Since ‘Insurance’ is covered under the definition of service as contemplated under Consumer Protection Act, Insurance Company is a service provider and the complainant is a ‘Consumer’.  Point No. 1 is decided in favour of the complainant.

7.  Point No: 2    

      One of the contentions raised by the opposite parties is that the complaint is barred by the law of limitation.  The policy of the complainant lapsed due to non-payment of premium due in 2010 and the present complaint is filed after a period of 10 years and is barred by limitation.

          It is admitted that the complainant took the policy in the year 2009 and its tenure was for 10 years.  After the expiry of the policy the complainant send a letter to the opposite parties 4 and 5 requesting them to return the amount deposited at the time of joining the policy.  Opposite parties sent reply that the money cannot be returned as the surrender value is none.  Since the cause of action is continuing upto the expiry of the policy in 2019, the complaint filed in 2020 is well within the permitted period.

8.  Point No: 3

Complaint averment is to the effect that the complainant availed a policy HDFC Pension II Policy from the 1^st opposite party.  The policy commenced on 6^th January 2009 and its tenure was for a period of 10 years.  The annual premium for the policy was Rs. 50,000/-  The complainant paid Rs.50,000/- at the time of joining the policy.  After the expiry of the policy, on 24/09/2019, he sent a letter to 4^th and 5^th opposite parties requesting them to return the amount with nominal interest.  But the opposite parties sent reply letter stating that they cannot accept his request as the surrender value is none.

9.   Opposite parties contention in this regard is that the complainant after having paid the premium along with application, failed to pay the subsequent premiums.  The amount paid by the complainant is not deposit, but it is the premium towards the policy.  The policy lapsed due to non-payment of premium payable in the 1^st anniversary, the surrender charge was 100% and no surrender value was payable as per the Terms and conditions of the policy.            

10. Ext. A1 is the ‘First Premium Receipt’ issued by the opposite parties for the payment of premium amount of Rs. 50,000/-

          Ext. A4 is the ‘Final Revival Quotation Policy No: 12512874’ issued by opposite parties to the complainant.  In this, the opposite parties have informed the complainant that they have not received the premiums due for the aforesaid policy since 06/01/2010 and the policy status changed to ‘Lapsed’ on 06/01/2010 and all the policy benefits were cancelled in accordance with the change in policy status.  They further informed that the policy can be revived maximum within 2 years from the date of lapse or within 3 years from the date of inception whichever is later.  If it is not revived within this period, the policy will not be eligible for revival in future and the amount with them after deduction of charges as per the policy provisions will be refunded.  

11. In Ext. A3, page no. 4 under the Heading schedule of charges (for HDFC Unit Linked Pension II) continued shows surrender charges for the various periods.  It contains a clause that “Before the payment of the premium due on the 1^st policy anniversary, the surrender charge is 100% of the Fund value”.

12. Here the complainant himself has admitted that he only made a payment of Rs. 50,000/- at the time of joining the policy.  So as per the terms and conditions of the policy, the surrender charge is 100% of the fund value.  So no amount is due to the complainant from the opposite party as per the terms and conditions of the policy.  So the opposite parties are justified in refusing the repayment of premium/accruals thereon.      

13.    Points 4 to 6

      From the conclusion arrived at in Point No: 3, no amount is due to the complainant from the opposite parties.  The opposite parties had acted as per the terms and conditions of the policy and there is no deficiency in service or unfair trade practice on their part.  The complainant is not entitled to the reliefs claimed.

      In the result, the complaint is dismissed.                

Pronounced in open court on this the 8^th day of May, 2023.

                                                                                           Sd/-

                                                                                    Vinay Menon V

                                                                               President                                              

                                                       Sd/-

              Vidya.A

                             Member                                                                                                                                                                                           

                                                                                             Sd/-

                                                                                  Krishnankutty N.K.

                                                                                           Member

APPENDIX

Documents marked from the side of the complainant:

Ext. A1: First Premium Receipt dated 06/01/2009.

Ext. A2: Unit Statement as on 06/01/2009.

Ext. A3: Letter from Sr. Vice President dated 07/01/2009.

Ext. A4: Final Revival Quotation dated 07/12/2011.

Ext. A5: Letter dated 24/04/2019 for settlement of claim.

Ext. A6: Letter dated 07/05/2019 to the complainant.

Documents marked from the side of opposite parties:

Ext. B1: Copy of Policy.

Ext. B2: Copy of Proposal form.

Witness examined from the complainant’s side:

Witness examined from the opposite parties side:

Cost- Nil  

NB: Parties are directed to take back all extra set of documents submitted in the proceedings in accordance with Regulation 20(5) of the Consumer Protection (Consumer Commission Procedure) Regulations, 2020 failing which they will be weeded out.