BEFORE THE A.P.STATE CONSUMER DISPUTES REDRESSAL COMMISSION:
HYDERABAD.
FA.NO.900 OF 2005 AGAINST C.D.NO.223 OF 2004 District Forum, Prakasam at Ongole.
Between:
Branch Manager,
Life Insurance Corporation of India,
Padmavathi Buildings, Ramnagar,
Ongole, Prakasam District. Appellant/
Opp. party
And
Pathuri Venkata Krishna Rao, S/o.Subbarayudu
R/o.Prasangulappadu Via Naguluppalapadu
Korsipadu Mandal, Prakasam District. Respondent/
Complainant
Counsel for the Appellant : Mr.P.Ravi
Counsel for the Respondent:M/s.M.S.N.Prasad.
CORAM:SMT.M.SHREESHA, HON’BLE INCHARGE PRESIDENT
AND
SRI G.BHOOPATHI REDDY, HON’BLE MEMBER
TUESDAY, THE TWENTY NINTH DAY OF APRIL
TWO THOUSAND EIGHT.
Oral Order : (Per Smt.M.Shreesha, Hon’ble Incharge President)
***
Aggrieved by the order in C.D.No.223/2004 on the file of District Forum, Prakasam at Ongole, opposite party preferred this appeal.
The brief facts as set out in the complaint are that the complainant insured his life with opposite party insurance company and opposite party issued a policy bearing No.64441804 in favour of the complainant and the complainant paid the premiums regularly upto completion of 20 years, which the policy matured date. As per the terms and conditions of the insurance policy issued by them, he is entitled to the total amount of Rs.34,620/- including bonus and other benefits. Opposite party by letter dated 28-5-2004 informed that the complainant is entitled to total amount of Rs.34,620/- and deducted the loan amount of Rs.17,400/-, loan interest of Rs.6,253/- to which it is entitled but deducted another amount of Rs.10,967/- under the head ‘Other Deductions” which it is not entitled to, and also without mentioning the details under which it is entitled to deduct the same. Hence the complaint for a direction to the opposite party to pay Rs.10,967/- with interest.
Opposite party filed counter stating that the complainant had availed a loan of Rs.21,900/- on his policy on various dates but in the computer the amount was wrongly entered as Rs.17,400/- and hence the remaining loan principle amount of Rs.4,500/- was taken short. They submitted that it is their practice that whenever further loans are sanctioned to recover interest on previous policy loan due at the time of settlement of new loan and they sanctioned loan of Rs.5,500/- on 3-8-1994, the actual gross loan payable was Rs.6,900/- only as per the paid up surrender value calculations. They should have recovered Rs.5,900/- towards previous loan and interest and has to pay an amount of Rs.504.40 ps only but paid Rs.5500/- without any deductions which means an amount of Rs.4,995.60 ps was paid in excess on 3-8-1994 out of gross loan amount of Rs.6,900/-. Thus the excess payment of Rs.4,500/- towards loan and Rs.495.60 paise towards interest due to non recovery on that had to be recovered from the complainant. The total amount of excess payment together with interest from 3-8-1994 till the date of maturity has to be recovered and the cumulated amount of Rs.4,905.60 ps works out to Rs.13,650/- and this amount was recovered from the complainant while settling his maturity claim. Hence the total amount that has to be recovered from the complainant out of his loans together with interest has come to Rs.37,303/- whereas they have recovered an amount of Rs.34,620/- and the complainant is still due an amount of Rs.2,683/- towards arrears of loan and interest and submitted that there is no deficiency of service and prayed for dismissal of the complaint.
Based on the evidence adduced i.e. Exs.A1 to A4 and B1, the District Forum allowed the complaint directing opposite party to pay an amount of Rs.10,967/- with interest @ 9% p.a. from the date of Ex.A4 letter i.e. 28-5-2004 til the date of realization together with compensation of Rs.2,000/- and costs of Rs.1,000/-.
Aggrieved by the said order, opposite party preferred this appeal.
The learned counsel for the appellant submitted that the District Forum failed to appreciate the material on record in the correct perspective in the light of principles laid down in decided cases and the order is thereby wholly vitiated. He further contended that the District Forum failed to see that the respondent/complainant did not raise any objections with regard to availing loan on several occasions. He has not denied taking loan of Rs.21,900/- from the appellant and now the respondent/complainant cannot take advantage of the bonafide clerical mistake while entering the loan amount in the system and refuse recovery of the loan amount which was genuine. He contended that the appellant replied in time by issuing letter dated 28-5-2004 and that there are further dues and he ought to have approached the civil court for determination of the quantum of liability. He submitted that the respondent did not file any reply affidavit contradicting the claim of the appellant and about the dues by the respondent and hence he is estopped from raising this issue later. He also submitted that the District Forum erred in granting compensation which is not at all prayed for by the respondent and prayed for allowing the appeal.
The learned counsel for the appellant also filed additional material papers along with the following table:
Date Loan amount Outstanding Interest Balance paid
Loan
Rs. Ps. Rs. Ps. Rs. Ps. Rs. Ps.
03-6-1988 1,300-00 ---- ---- 1,300-00
21-9-1989 2,300-00 1,300-00 176.40 823-60
15-10-1993 3,600-00 ---- 1,192.00 2,408-00
(Total 5,900/- Principal only + interest)
3-8-1994 5,500-00 ----- ---- 5,500-00
(as on this date the complainant was due Rs.5,500/- (+)5,900/- from
15-10-1993 total due 11,400/- (+) interest on 5,900/- from 15-10-1993)
13-7-2000 17,400-00 6,900-00 5,780-00 4,720-00
(as on this date the complainant was still due Rs.4,500/-(11,400 (-)
6,900/- towards previous loan amounts and Rs.17,400/- further loan
The learned counsel for the respondent submitted that as per Ex.A4, letter dated issued by the appellant, the amounts in the payments column was mentioned as basic amount is Rs.15,000/- as basic amount, Rs.18,450/- as vested bonus and Rs.870/- as interim bonus and Rs.300/- towards additional bonus. In the deductions column, loan amount was mentioned as Rs.17,400/- and loan interest as Rs.6,253/- which was also mentioned in the deductions column and the other deductions as Rs.10,967/-. The counsel further contended that the appellant did not clarify as to why this computer mistake, which they have pleaded in their counter was not communicated to the complainant immediately.
We have perused the material on record. It is not in dispute that the respondent/complainant had taken a loan against his insurance policy, which is for an amount of Rs.34,620/- including bonus and other benefits. It is the case of the respondent that under the deductions, loan amount of Rs.17,400/- and loan interest of Rs.6,253/- i.e. only these two amounts have to be deducted from Rs.34,620/- but the appellant deducted another amount of Rs.10,967/- under the head ‘other deductions’ without mentioning any details. As against this, the learned counsel for the appellant/opposite party submitted that the respondent had taken various loans against the insurance policy and it is the practice of the appellant that whenever a further loan is granted, they deduct the outstanding previous loan amount and interest thereon from the new loan and pay only the balance of the said loan. In the instant case inadvertently by a mistake only interest accrued on the outstanding previous loan was deducted by the appellant and the balance was paid to the respondent after deducing the interest outstanding from the further loan amount. The District Forum observed that the appellant did not produce any documents or cheque numbers to prove that the respondent obtained a loan amount of Rs.21,900/- neither did it file any documentary proof with respect to the details of deduction of Rs.10,967/-. In the additional material papers filed by the counsel for the appellant, he filed the loan papers with details of loans obtained for Rs.1,300/- dated 3-6-1988, Rs.3,600/- dt.15-10-1993, Rs.5,500/- dated 3-8-1994 and lastly a computerized statement stating that loan applied for Rs.17,400/- and after deductions the net amount payable is Rs.4,720/- and this is dated 13-7-2000. This statement also does not give any specific details which have not already been mentioned in the counter. There is no explanation as to how the deduction of Rs.10,967/- was made under “other heads’ as per Ex.A4 and as to why this was not brought to the notice of the respondent prior to deduction giving him an opportunity to present his case. This is in violation of the principles of natural justice. The respondent got issued a legal notice on 04-10-2004 and appellant had sent a letter dated 7-10-2004 in which this plea of computer mistake was not taken. We are also of the considered view that the appellant/opposite party ought to have informed the respondent/complainant immediately had there been a computer mistake instead of unilaterally deducting Rs.10,967/- under ‘other deductions’ without giving any details. Since there are no specific details given in the additional papers with respect to deductions under other heads, we do not see any reason to interfere with the well considered order of the District Forum. We also modify the date of interest from 28-5-2004 from which date the District Forum awarded interest to the date of legal notice got issued by the respondent/complainant i.e. 4-10-2004. However, having granted the amount with interest at 9% p.a. we see no grounds to award further compensation of Rs.2,000/- while confirming the other aspects of the order of the District Forum.
In the result this appeal is allowed in part by modifying the order of the District Forum with respect to the date of interest from 28-5-2004 to the date of legal notice got issued by the respondent/complainant i.e. 4-10-2004 and also by setting aside the order with respect to award of compensation while confirming the other aspects of the order of the District Forum. Time for compliance six weeks.
INCHARGE PRESIDENT. MALE MEMBER.
JM Dated 29-4-2008
