Before the District Forum: Kurnool
Present: Sri K.V.H. Prasad, B.A., LL.B., President
And
Smt C.Preethi, M.A., LL.B., Member
Sri R.Ramachandra Reddy, B.Com., LL.B., Member
Thursday the 12th day of May. 2005
C.D.No. 32/2003
Smt Jadav Vijaya Lakshmi,
W/o. Late Harinatha Rao,
R/o. 62/206, Fort,
Kurnool. . . . Complainant represented by his counsel
Sri Katam Sreenivasa Reddy,Advocate
-Vs-
1. Panyam Cements and Minerals Ltd,
Cement Nagar,
Kurnool Dist. .. . Opposite party No.1 represented by his
counsel Sri V.V. Augustine, Advocate
2. The Senior Divisional Manager,
L.I.C of India,
Divisional Office,
Cuddapah. . . . Opposite party No.2 represented by his
Counsel Sri I. Antha Rama Sastry
O R D E R
(As per Smt C.Preethi, Member)
1. This CD complaint of the complainant is filed under section 12 of C.P Act, 1986, seeking a direction on the opposite parties to pay policy amount with 15percent interest per annum from 12.6.2001 till payment, award compensation for mental agony and costs of the complaint.
2. The brief facts of the complainant s case is that the complainant s husband Late Jadav Harinatha Rao working with opposite party No.1 as Senior Assistant in Internal Audit department, insured with opposite party No.2 under Salary Saving Scheme with G.S.L.I Master policy bearing No. 40465 vide Membership No. 86 for Rs. 70,000/- and nominated the complainant as his nominee under the above said policy. The deceased authorized his employer i.e opposite party No.1 to deduct a sum of Rs. 60/- per month from his salary towards premium of the above said policy and to remit it to opposite party No.2 i.e LIC of India. The said Harinatha Rao died on 29.9.2000. As a nominee the complainant informed the opposite party No.2 on 6.6.2001 about the death of Harinatha Rao and preferred a claim requesting for payment of policy amount. But the opposite party No.2 through their communication dt 12.6.2001 informed the complainant that the policy was in lapsed condition, due to non-payment of premium by
opposite party No.1. But the complainant submits that opposite party No.1 is the agent of opposite party No.2 and for non payment of premium by opposite party No.1 the opposite party No.2 cannot escape from its liability and it is not possible for the employee to know whether the premium deducted from his salary is remitted or not. Hence, the above attitude of opposite party No.2 in repudiating the claim of the complainant is amounting to deficiency of service to its policy holder.
3. In support of its case the complainant filed the following Xerox documents Death Certificate of Harinatha Rao dt 18.10.2002, letter dt 6.6.2001 of complainant addressed to opposite party No.2 and letter dt 12.6.2001 of opposite party No.2 addressed to the complainant, besides to the sworn affidavit of the complainant in reiteration of her complaint averments. The complainant did not evince any interest in getting the documents filed as exhibits, but on the other hand the documents filed are Xerox documents which cannot acquire any evidentiary value for want of their proof with their originals or with attestation.
4. In pursuance to the notice of this Forum as to this case of the complainant the opposite parties appeared through their standing counsel and contested the case by filling separate written version as defence.
5. The written version of opposite party No.1 submits that opposite party No.2 has floated a Salary Saving Scheme which is known as GSLI (Group Saving Linked Insurance) and issued a Master Policy bearing No. 40435 with effect from 20.10.1995. Accordingly this policy was take for three categories of members namely (1) Executives (2) Management Staff and (3) Administrative Staff and Workmen and the opposite party No.1 paid Rs. 44,480/- as first premium to opposite party No.2 for its 417 members under Master Policy bearing No. 40465. The opposite party No.1 paid premium regularly to opposite party No.2 till termination of the said policy by opposite party No.2 and there was no concrete proposal to revive the said terminated policy by opposite party No.2.
6. The opposite party No.1 further submits that the premium are deducted from the salaries its members including the complainant s husbands and remitted to opposite party No.2 free of cost with out any charge, so it is not liable for not rendering any service to its members.
7. It also stated by opposite party No.1 that it has never acted as Agent to opposite party No.2 for procuring business of LIC as such it is not liable to pay any compensation. It further says it has acted in the best interest of its employees and seeks for the dismissal of complaint.
8. The written version of opposite party No.2 admits that Late Sri Harinatha Rao working as Senior Assistant with opposite party No.1 was a member of Group Saving Linked Insurance scheme of opposite party No.2. The contract of Group Saving Linked Insurance policy is between opposite party No.1 and opposite party No.2 and as per Group Saving Linked Insurance rules the Master Policy holder i.e opposite party No.1 has to deduct an amount of Rs. 60/- per month from the salary of its employees and remit the same with opposite party No.2 on or before 20th of every month. Out of Rs. 60/- Rs.21/- will be adjusted towards risk premium and balance Rs. 39/- i.e saving premium will be refunded with interest on retirement of the employee and in case of death before retirement insurance amount of Rs. 60,000/- will be paid subject to policy being kept in force by paying premium regularly.
9. It also admits of receipt of intimation from the complainant regarding the death of J.Harinatha Rao on 29.9.2000, as the Master Policy holder i.e opposite party No.1 discontinued the scheme by not paying the premium from 20.12.1999, therefore, the scheme is not inforce. Hence, the liability of opposite party No.2 is limited to payment of savings portion with interest only. The said savings portion with interest totaling an amount of Rs. 2,313/- was paid to Master Policy holder ( i.e opposite party No.1) on 12.11.2002 towards whole sale surrender value vide Demand Drafts bearing No.s 489, 490, 491, dt 12.11.2002. The Master Policy holder failed to pay premium in respect of all its members from 20.12.1999. As there was no response from the Master policy holder to the letters dt 6.7.2000, 7.8.2000 and 10.11.2000 of the opposite party No.2, the opposite party No.2 wrote a registered letter dt 23.5.2001 to send Original Master Policy Bond and discharge voucher for closure of the scheme. In reply to the said letter opposite party No.1 through its letter dt 26.10.2002 submitted Six Master Policy Bonds with a request to settle for wholesale surrender value of all the Six Master Policies. Accordingly the opposite party No.2 settled the whole sale surrender value of the Six master policies on 12.11.2002 and cancelled the six schemes.
10. The opposite party No.2 further submits that it is the responsibility of the Master Policy Holder to remit premium regularly on due date and keep the Master Policy in force and there is no obligation on opposite party No.2 to serve premium notices to Master Policy Holder or to the members of the policy. The contract of Group Saving Linked Insurance scheme is between M/s Panyam Cements and Mineral Industries Ltd, Cement Nagar (i.e opposite party No.1) and LIC of India (i.e opposite party No.2) and the members of the scheme are not entitled to take any legal action against opposite party No.2. As the husband of complainant died after dis continuation of the scheme, the opposite party No.2 is not liable to pay the insurance amount of Rs. 60,000/- to the complainant. Therefore, seeks for the dismissal of complaint with costs.
11. The opposite parties 1and 2 in support of their case relied on the following documents Viz (1) Master Policy No. (GSLI) 40465 of opposite party No.1 issued by opposite party No.2 (2) Telegram dt 20.6.2000 of opposite party No.2 to opposite party No.1 (3) letter dt 6.7.2000 of opposite party No.2 to opposite party No.1 (4) letter dt 7.8.2000 of opposite party No.2 to opposite party No.1 (5) letter dt 23.5.2001 of opposite party No.2 to opposite party No.1 (6) letter dt 26.10.2002 of opposite party No.1 to opposite party No.2 (7) attested copy of Schedule of employee of opposite party No.1(8) attested copy of letter dt 26.10.2002 of opposite party No.1 to opposite party No.2 (9) attested copy of letter dt 12.11.2002 of opposite party No.2 to opposite party No.1 and (10) attested copy of claim payment voucher issued by opposite party No.2 in favour of opposite party No.1 dt 12.11.2002, besides to the sworn affidavit of opposite party No.1 and 2 and the above documents are marked as exhibit B.1 to B.10 for its appreciation in this case.
12. Hence, the point for consideration is to what relief the complainant is entitled alleging deficiency of service and deficient conduct on part of opposite parties:-
13. It is the case of the complainant that her husband J. Harinatha Rao has taken a policy from opposite party No.2 under Salary Saving Scheme, authorizing the opposite party No.1, under whom the deceased was working, to deduct the premium from his salary and remit it to opposite party No.2. The deceased J. Harinatha Rao died on 21.7.2001, claim was preferred to opposite party No.2 which was rejected stating that Master Policy Holder has not paid premium from 20.12.1999 and policy is in lapsed condition. But as against to it the opposite party No.1 submits that it deducted the required premiums from its employees and remit it to opposite party No.2 for the welfare of its employees and it is opposite party No.2 who has to pay the assured amount.
14. It is submitted by opposite party No.2 that it has entered into contract with opposite party No.1 under Group Saving Linking Insurance Scheme and issued six Master Policies. The opposite party No.1 i.e Master Policy Holder has dis continued the said scheme from 20.12.1999 by not paying the premiums and surrendered the six master policies on 26.10.2002 vide Ex B.6, which envisages that opposite party No.1 has submitted six original master policies covered under Group Saving Linking Insurance Scheme to opposite party No.2 for whole sale surrender, with a request to send surrender value at the earliest. After receipt of Exhibit B.6 the opposite party No.2 settled the six master policies for whole sale surrender value payable under the six policies vide Demand Draft s bearing no. s 000489, 000490 and 000491 dt 12.11.2002, sent to opposite party No.1 vide covering letter of opposite party No.2 in Ex B.9 for Rs. 8,98,200/-, Rs,8,98,200/- and Rs. 4,05,772/- respectively as full and final settlement of whole sale surrender value of six Group Saving Linking Insurance Master policies of opposite party No.1. The Ex B.10 is the claim payment voucher in favour of opposite party No.1 (i.e master policy holder) for Rs. 22,06,584/- as being payment of whole sale surrender value of Group Saving Linking Insurance policies bearing No.s 40111, 40208, 40284, 40330, 40465 and 40918. The Ex B.1 is the Master policy bearing No. (GSLI) 40465 infavour of opposite party No.1 issued by opposite party No.2. The Ex B.2 is telegram of opposite party No.2 to opposite party No.1 and Ex B.3 , B.4 and B.5 dt 6.7.2000, 7.8.2001 and 23.5.2001are the letter addressed by opposite party No.2 to opposite party No.1 requesting for payment of premium from 20.12.1999. The facts borne in the above said record is not denied by the complainant s side. Hence, from them it remains clear that the said policy was taken by opposite party No.1 under Group Saving Linking Insurance Scheme vide Ex B.1for the beneficiary of its employees. The opposite party No.1 as the Master Policy Holder of the said policy can do what he pleases in respect of the said policy, as such the said Master Policy was surrendered by opposite party No.1 (i.e master policy holder) to opposite party No.2 vide Ex B.6 for wholesale surrender value and the said wholesale surrender value was paid to opposite party No.1 vide Ex B.10 claim payment voucher, as the said surrender value was paid by opposite party No.2 to opposite party No.1 the complainant now cannot claim for payment of assured amount from the opposite party No.2. If at all the complainant is entitled, only to the surrender value regarding the said policy. As the payment is made by opposite party No.2 to opposite party No.1, there lies no amount with opposite party No.2, hence, for claiming surrender value from opposite party No.1 this Forum has no jurisdiction to entertain the said claim and complainant has to seek relief in the proper Court.
15. Therefore what follows is that the master policy holder i.e opposite party No.1 has taken wholesale surrender value regarding the said policy and the policy was not inforce from 20.12.1999 for non payment premium, hence the complainant is not entitled to claim assured amount from opposite party No.2. Therefore, the complaint of the complainant is dismissed.
16. The opposite party No.1 in support of its case relied on the following citations AIR 2000, Supreme Court Pg 43 and II 2002 CPJ 455 which has little relevancy for appreciation in this case.
17. In the result the complaint is dismissed for want of merit and force.
Dictation to the Stenographer, type to dictation corrected by us pronounced in the Open Court this the 12th day of May, 2005.
Sd/-
PRESIDENT
Sd/- Sd/-
MEMBER MEMBER
APPENDIX OF EVIDENCE
Witnesses Examined
For the complainant For the opposite parties
-Nil- -Nil-
List of Exhibits Marked
For the complainant For the opposite parties
-Nil- Ex B.1 Master policy No. 40465 issued
by opposite party No.2.
Ex B.2 Telegram dt 20.6.2000 of
Opposite party No.2 to opposite party
No.1
Ex B.3 Letter dt 6.7.2000 of opposite
party No.2 to opposite party No.1.
Ex B.4 Letter dt 7.8.2000 of opposite
party No.2 to opposite party No.1.
Ex B.5 Letter dt 23.5.2001 of opposite
party No.2 to opposite party No.1.
Ex B.6 Letter dt 26.10.2004 of opposite
party No.1 to opposite party No.2.
Ex B.7 List of employer wholesale
Surrender value payable to employer
of opposite party No.1.
Ex B.8 Xerox copy letter dt 26.10.2002
Of opposite party No.1 to opposite
party No.2.
Ex B.9 Letter dt 12.11.2002 of opposite
party No.2 to opposite party No.2.
Sd/-
PRESIDENT
Sd/- Sd/-
MEMBER MEMBER
