Delhi

West Delhi

CC/13/681

KHALIDA BEGUM - Complainant(s)

Versus

RELIANCE LIFE INSURANCE - Opp.Party(s)

26 Dec 2013

ORDER

 CONSUMER DISPUTES REDRESSAL FORUM (WEST)

GOVERNMENT OF NCT OF DELHI

150-151, Community Centre, C-Block, Janak Puri, New Delhi – 110058

 

                                                                                     Date of institution           : 13.11.2013

 

Case. No.DF-III/681/2013/                                         Date of order                :01.07.216

In the matter of :-

Khalida Begum,

4/4C, Veena Enclave,

Nangloi, New Delhi-110041.                                                                  Complainant

Vs.

 

Vedpal Hooda (Agent code-20071313),

Agent (Reliance Life Insurance Co. Ltd.,)

RZ 2/141/ Veena Enclave,

Nangloi, New Delhi-110041                                                       Opposite Party No.1

 

Reliance Life Insurance Co. Ltd. (Regd. No.121)

H-Block, 1^st Floor, Dhirubhai Ambani Knowledge City,

Navi Mumbai, Maharashtra – 400710, India                                    Opposite Party No.2

 

 (R.S. BAGRI, PRESIDENT)

O R D E R     

 

                        The present complaint  U/s 12 of the Consumer Protection Act, 1986 is filed by Smt. Khalida Begum herein complainant against Sh. Vedpal Hooda and Ors. herein opposite  parties  for direction to the opposite  parties for refund of Rs. 5.00 lacs paid by her to Reliance Life Insurance Co. Ltd. (OP-2) as premium of Reliance Super Golden Years Term 10 plan, policy with interest @ 18% p.a.  and compensation of Rs. 3.00 lacs on account of physical and mental harassment and litigation expenses.

 

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            The brief relevant facts for disposal of the complaint are that in the year 2010, the complainant sold her property for Rs. 5.00 lacs.   Sh. Vedpal Hooda –Opposite party No.1 approached her with a proposal to invest in the reliance money.   Sh. Vedpal Hooda did not know complete details of the policy.   Therefore, he introduced her to Sh. B.D. Tiwari, Sr. Sales Manager of Reliance Life Insurance Co. Ltd. – opposite party No.2.  Sh. B.D. Tiwari guaranteed that there will be  minimum return of 18 % P.A on the policy against the bank rate of interest of 8% prevailing at that time.   He also assured her that her money will be doubled in four years.   Sh. B.D. Tiwari and Sh. Vedpal Hooda both told her that premium shall be payable in first year only.   There will be no premium payment thereafter.

 

                        The complainant is a house wife and has no knowledge of the policy or the scheme in which the money was to be invested.   Sh. B.D. Tiwari on 17.9.10 and 21.9.10 visited her house twice and assured her that her money was increasing very fast.   The complainant signed blank proposal form and gave to Sh. B.D. Tiwari who filled in the proposal form without disclosing the contents to the complainant.   She received sale consideration of her property in cash and gave the money to opposite party No.1 in cash.   He told her that he further handed over cash of Rs. 5.00 lacs to the concerned Branch Manager.   The Branch Manager prepared bank draft at his own before issue of the policy.   She has no independent source of income.  She did not inform Sh. B.D. Tiwari about her rental income.   The proposal form sent  back to the complainant shows that the complainant  has annual rental income of  Rs. 2.00  lacs.    It  is

 

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against  the  insurance rules and policies to give Insurance policy to  an individual exceeding her annual income.  The  Insurance Regulatory and Development Authority  (IRDA) Rules of 2002 provides that insurance is a matter of utmost good faith  both for the insured  and insurance company.   The complainant could not take any insurance policy having 10 years term with annual premium of Rs. 5.00 lacs.    According to complainant, the proposal form does not reflect the application number and policy number which shows that these papers are forged  by Sh. B.D. Tiwari    in connivance with the insurance company.   The page No. 22 of the proposal form was to be signed  by Sh. Vedpal Hooda, insurance agent whereas it is signed by one Sh. Ajay Kumar.   He was not present  at the time of filling of proposal form.  He is also known to the complainant.

 

                        Once she received a message from the opposite party No.1 asking the complainant to pay next premium of the policy,  she was shocked as she had applied for single premium policy.   She went to opposite party No.1 and narrated the facts of the message.  He  told her to visit nearest branch of opposite party No.2.   She visited Peeragrahi Branch of opposite party No.2.  The branch manager told her that her policy is regular premium policy and she was cheated.   She has to pay Rs. 5.00 lacs every year.   She made complaint to opposite party No.2 with free look cancellation request to look into her matter  and refund the money but they did not respond.   The complainant again went to opposite party No.1,  who told her  that she did not take any life cover and there will be no effect on her amount and after locking period of 3 years she will get her money with interest.   In the year 2013 she again got a message on her mobile that her reliance life insurance policy has been terminated.  She will

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get Rs. 3.30 lacs.  She went to opposite party No.1 who told her that the employees of the insurance company have no knowledge .   She took single premium insurance policy.   The opposite party No.2 has wrongly and fraudently issued 10 years reliance life insurance policy.    She had no income to pay demanded premium of the policy.   She asserted that the opposite parties have adopted unfair-trade-practice and have given policy for 10 years instead of one time payment policy.  Hence, the present complaint with direction to the opposite parties to refund her amount of Rs. 5.00 lacs with interest @ 18% P.A. and  Rs. 3.00 lacs for physical and mental harassment and litigation expenses.

 

                        Notice was sent to opposite parties.    The opposite parties appeared and opposite party No.2 filed reply to the complaint while raising preliminary objections  of cause of action,  the complainant is not covered U/s 2(1) of the Consumer Protection Act, concealment  of true facts and the complaint is false, frivolous  and based on after thought version and prayed for dismissal of the complaint.

 

                        The opposite party No.2 on merits asserted that the complainant after reading and understanding terms and condition of the policy voluntarily signed proposal form without any inducement  and she is bound by the terms and conditions of the policy form.   She signed the application form and applied for Reliance life insurance and took the insurance policy.   The opposite party No.2 on  relying  on  statement  and  representation  of  complainant   made  in

 

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proposal form for life insurance issued the insurance policy.   The policy was dispatched to the complainant  and  the  complainant  after  a belated period of 3 years approached  the opposite party No.2 for cancellation of the policy. The complainant did not pay instalment/ premium of the policy in time.   Therefore, the policy was got auto surrendered on 21.8.2013 with a value of Rs. 3,31,815.24/-.   Therefore, opposite party No.2 rightly refused to cancel the policy at later stage and gave Rs. 3,31,815.24 to the complainant.   All other allegations  of the complainant are vehemently denied by opposite party No.2 and once again prayed for dismissal of the complaint.

 

            Shri Ved Pal Hooda filed reply dated 28.2.14 mentioning that complainant had given Rs. 5.00 lacs for investment in Single Premium Policy and that the form was filled by Sales Manager of opposite party No.2.

 

 

            The complainant filed rejoinder to the reply of opposite party No.2 while controverting the stand taken by the opposite party No.2 and reiterated her stand taken in the complaint.  She again prayed for refund of the money with interest and compensation.  

 

             While the complainant was  asked to lead evidence, Smt. Khalida Begum, complainant tendered her affidavit and affidavit of Sh. Vedpal Hooda, opposite party No.1 in her evidence.   They both have narrated the facts of the complaint and deposed that fraud  has been played  by the then Branch Manager of  the  Reliance  Life  Insurance Co. Ltd. and Sh. B.D. Tiwari, Sr.  Sales

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Manager.   The complainant purchased one time insurance policy.  She had no source of income.  She could not pay premium of Rs. 5.00 lacs. P.A.  Therefore, she did not apply for 10 years insurance policy.   She is entitled for refund of Rs. 5.00 lacs paid by her with interest @ 18% P.A. and Rs. 3.00 lacs as compensation on account of mental and physical sufferings and litigation expenses.  

 

            The complainant in support of her case also relied upon receipt  dated 10.8.10 for a sum of Rs. 3,00,000/- and  Rs. 2,00,000/- dated 9.8.10   and her request dated 22.10.11 for  free look cancellation made  by the  complainant  to opposite party, along with terms and conditions for cancellation  of the insurance policy, statement of accounts of Khalida Begum, complainant  of Corporation Bank, Delhi, unit linked policy with retirement plan (i.e Reliance Super Golden years Term 10 Plan) No. 17707134 and (Common Proposal Form for Life Insurance) proposal form of the complainant.

 

            The opposite party No.2 in support of their case tendered in evidence affidavit of Sh. Rohit Sahni, Senior Territory Manager who narrated  facts of the complaint and asserted that there is no unfair trade practice on the part of opposite party No.2.   The complainant herself applied  for the insurance policy and her request  and proposal form the policy was given to her.

 

            We have heard the complainant in person and Sh. R.L. Akharia, advocate for opposite party No.2 and have gone through the material on record carefully and thoroughly.

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            According to complainant, she wanted to invest Rs. 5.00 lacs received by her from sale of her flat /plot and was in contact with Sh. Vedpal Hooda (OP-1) agent of opposite party No.2.   He advised her to invest in a policy in Reliance Life Insurance.  He sent her to meet Sh. B.D. Tiwari (SSM) of opposite party           No. 2 for the purpose.   Who manipulated the case and obtained her signatures on blank form.   He issued unit linked policy for 10  years with retirement plan instead of one time investment policy.   She had  no source of income and could not pay premium of Rs. 5.00 lacs P.A.  Hence, there is unfair trade practice on their part.

 

            The opposite party No.2 has failed to examine Sh. B.D. Tiwari, Senior Sales Manager against whom complainant has levelled allegations of fraud, cheating, forgery and unfair trade practice.    The opposite party No.2 has tendered  affidavit of Sh. Rohit Sahni, Sr. Territory Manager.   He is formal witness.   His affidavit is fully rebutted by affidavit of Khalida Begum, complainant and Sh. Ved Pal Hooda (OP-I).   They have both deposed that signature of complainant were obtained  on blank proposal form and she wanted to invest  money in one time payment investment scheme.    Sh. B.D. Tiwari, Sr. Sales Manager instead of issuing one time investment policy issued unit linked  policy for 10 years with retirement plan with annual premium of Rs. 5.00 lacs P.A despite the fact in the proposal form income of the complainant is shown Rs. 2.00 lacs.    The opposite party No.2  has failed  to explain that how a person  having income of Rs. 2.00 lacs P.A only  can pay premium of Rs. 5.00 lacs P.A.    They have also failed to explain  why they failed to produce affidavit

 

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of Sh. B.D. Tiwari,  Sr. Sales Manager.   There is no reason to disbelieve the affidavit of Sh. Ved Pal Hooda and reply filed by him wherein he specifically supported version of the complainant despite the fact  he is agent of opposite party No.2.

 

            A perusal of the common proposal form placed on record shows that at page No.3 attesting witness is Ajay Kumar and signature of Khalida Begum are obtained on the place where L.A. of the insurance company and IR&DA is to sign.   Whereas column of signature of deponent is blank.  Similarly, column of signature  of Ved Pal Hooda at page No.4 of the common proposal form is blank and Sh. B.D. Tiwari has signed  as authorised signatory.   Sl. No. 4 of the of the report  of the authorised signatory at page No.4 of the common proposal form  provides satisfaction of the authorised signatory regarding financial eligibility  of applicant to pay the premium.   But the above facts and circumstances  shows that the common proposal form  is not filed and examined satisfactorily and the terms and conditions of the common proposal form were not explained  by the agent and officer of the insurance company as required under point 3(2) of the IRDA Regulations, 2002. The complainant is also not in a position to pay annual premium of Rs. 5.00 lacs as she has no source of income.

 

            The list of product of Reliance life insurance  Co. Ltd. (OP-2) shows that the policy given to complainant i.e. Reliance Super Golden Years Term 10 Plan as a produce commenced on 23.11.09 and was withdrawn  on 31.8.10, is sufficient  to show that it was against the IRDA rules and regulations.

 

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            In the absence of affidavit of Sh. B.D. Tiwari, Sr. Sales Manager it can not be held  and said that the terms and conditions were explained  to the applicant.    The    complainant   can  not  be held responsible for something, that is beyond her knowledge.  Rather her signature were obtained  on  blank form, especially when places of signature of Sh. Ved Pal Hooda (OP-I) in the common proposal form are lying vacant.    Sh. B.D. Twiari has signed  the proposal form which shows that he has satisfied himself regarding financial  and other eligibility of the complainant to pay premium.  But the fact that in the proposal form income of complainant is shown of Rs. 2.00 lacs P.A only whereas  premium of the insurance police is Rs. 5.00 lacs P.A.    There is nothing on the record to show that person having income of Rs. 2.00 lacs P.A only is competent to pay premium of Rs. 5.00 lacs P.A.   It seems that the opposite party adopted unfair trade practice and instead of issuing policy of one time investment issued unit linked policy for 10 years with retirement plan with premium of Rs.5.00 lacs P.A.  

 

                        Hence, the complainant succeeded  to prove that the opposite party No.2 mislead the complainant about the benefits of the plan and adopted unfair trade practice and there is deficiency of service on their part.  

           

 

 

 

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            Therefore, we direct the opposite party-No. 2 to pay  Rs. 5.00   lacs   to  the complainant  with interest @ 9% P.A from the date of receipt of the  amount.   They are also directed to pay a sum of Rs. 50,000/- on account of harassment for mental agony and suffering and litigation    expenses.

 

Order pronounced on   :

 

• Compliance of the order be made within the 30 days after receipt of the order.
• Copy of order be sent to the parties free of cost.
• File be  consigned to record.

 

 

 

 

 

(PUNEET LAMBA)                               (URMILA GUPTA)                   ( R.S.  BAGRI )

  MEMBER                                            MEMBER                               PRESIDENT