Date of filing: 05.07.2013.
Date of disposal: 07.03.2014.
BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM - II:
VIJAYAWADA, KRISHNA DISTRICT
Present: Sri A. M. L. Narasimha Rao, B.Sc., B. L., President
Smt N. Tripura Sundari, B. Com., B. L., Member
Sri S. Sreeram, B.A., B.Com., B.L., Member
Wednesday, the 7th day of March, 2014
C.C.No.155 of 2013
Between:
1. Pilla Bangaramma, W/o late Suryanarayana, Hindu, R/o.D.No.4-12-17/1, Alinagar, Mazid Street, Lambadipet, Vijayawada – 9.
2. Pilla Nageswara Rao, S/o late Suryanarayana, Hindu, R/o.D.No.4-12-17/1, Alinagar, Mazid Street, Lambadipet, Vijayawada – 9.
3. Nagothi Jyothi, D/o Pilla Suryanarayana, Hindu, R/o.D.No.4-12-17/1, Alinagar, Mazid Street, Lambadipet, Vijayawada – 9.
….. Complainants
And
Road Safety Club (P) Ltd., Rep: by A.G.M. No.1, 1st Floor, Sambandam Street, G.N. Chetty Road, T. Nagar, Chennai, Tamilnadu State.
. … Opposite Party.
This complaint coming on before the Forum for final hearing on 19.02.2014, in the presence Sri K. Anantha Babu, advocate for complainants; Sri D. Raja Sekhar, advocate opposite party and upon perusing the material available on record, this Forum delivers the following:
O R D E R
(Delivered by Hon’ble President Sri A. M. L. Narasimha Rao,)
1. This complaint is filed by the legal heirs of Pilla Suryanarayana under Section 12 Consumer Protection Act, 1986 for a direction to the opposite party to pay insurance/claim amount of Rs.50,000/- and interest thereon, to pay Rs.15,000/- towards travelling and boarding expenses and Rs.5,000/- towards legal expenses and to pay Rs.10,000/- towards costs.
2. The averments of the complaint in brief are as follows:
Pilla Suryanarayana took membership of Road Safety Club (P) Ltd., for 84 months from 25.1.2007 on payment of Rs.5,000/-. As per the terms of the membership, the member shall have life risk coverage. The opposite party paid premium to Bajajallianz Life Insurance Company Ltd., on behalf of Suryanarayana for the period from 28.2.2007 to 27.2.2008. A certificate was issued accordingly. Pilla Suryanarayana died on 25.11.2011 leaving behind the complainants as the legal heirs. They are entitled to Rs.50,000/- the insurance amount. It was informed to the opposite party. The opposite party informed the complainant through letter dated 31.1.2011 to furnish required documents and succession certificate. The complainant had filed proceedings and obtained succession certificate. The documents were submitted at the Chennai office of the opposite party. Later the complainant enquired with Bajaj Allianz life Insurance Co., Ltd., and found that they are not entitled to insurance amount as the opposite party did not pay premium amount and did not renew the insurance coverage. There is deficiency in service on the part of the opposite party. The complainant got a legal notice issued to the opposite party and insurance company on 19.10.2012. Later they sent a reminder legal notice on 20.4.2013 to insurance company. The opposite party did not comply with the demand. So this complaint is filed.
3. The opposite party filed version admitting membership and issuance of certificate of insurance, denying the allegations made and further stating as follows:
The complainants addressed a letter dated 22.1.2011 to the insurance company and sent a copy to the opposite party. Then the opposite party sent letter to the insurance company on 31.1.2011 for registration of claim and sent another letter to the complainant to submit documents. The opposite party received documents on 23.3.2011 and sent them to the insurance company. The claim has to be settled by insurance company and not by the opposite party. The contract of insurance is between the deceased member Suryanarayana and the insurance company. The complaint is not maintainable against the opposite party. Bajaj Allianz General Insurance Co., the insurer is liable to settle the complainant’s claim. As per the terms of the application for membership all the members are eligible to receive complimentary insurance for 3 years. As per the terms and conditions of the membership, the Road Safety Club appoints arbitrator in case of any dispute. This complaint is not maintainable. Any dispute has to be adjudicated by the courts in Chennai and this Forum does not have territorial jurisdiction. The death of Pilla Suryanarayana on 25.1.2011 was covered under the policy issued by Bajaj Allianz General Insurance Co., commencing from 28.2.2010 to 27.2.2011. There is no deficiency in service on the part of the opposite party and it is not liable to pay any amount to the complainants.
4. The 2nd complainant filed his affidavit as deposition of PW.1. The General Manager of the opposite party filed affidavit as deposition of DW.1. Exs.A1 to A14 are marked on behalf of the complainants. No documents are marked on behalf of the opposite party.
5. Heard the arguments advanced by the learned counsel for both the parties. The complainants filed written arguments.
6. The points that fall for determination are:
- Whether this complaint is maintainable?
- Whether there is deficiency in service on the part of the opposite party?
- Whether the complainants are entitled to the amounts claimed?
Point No.1:
7. The opposite party objects the complaint on the ground of maintainability. DW.1 states in his affidavit that the complainants are not consumers and so they cannot maintain this complaint. The deceased Pilla Suryanarayana took membership in Road Safety Club on payment of Rs.5,000/-. They offered complimentary insurance coverage. The tenure of membership is 84 months from 25.1.2007. The term relating to insurance benefit noted on the reverse of Ex.A1 reveals that all the members are eligible to receive complimentary insurance. The main purpose of the membership is to conduct programmes relating to road safety. No doubt no separate fee or premium is collected from the members to cover insurance benefit. But it is a benefit offered to all members. So it is an inducement to the individuals to become members of the club. The fee of Rs.5,000/- paid for membership is deemed to include the consideration for insurance benefit also. It is to be noted that as per Ex.A4 certificate, Road Safety Club is the policy holder and Pilla Suryanarayana was a beneficiary. So insurance benefit is included in the membership for an assured sum of Rs.50,000/- and the deceased Suryanarayana was a consumer.
8. The opposite party objects to the jurisdiction of this Forum on the ground that the parties consented for Chennai Courts jurisdiction. We see no part of cause of action arising in Chennai. The parties cannot confer jurisdiction on the Courts or Forums in Chennai, on the well established principle that parties cannot confer jurisdiction on any courts or tribunal by consent.
9. The learned counsel for the opposite party raised another objection, that the complainants have to proceed against the insurance company and not against the opposite party as there is no deficiency on the part of the opposite party. We agree with this submission provided it is proved that there is no deficiency on the part of the opposite party and that the insurance company is at fault. It has to be considered on facts in the next point.
10. We therefore hold that this Forum has jurisdiction to entertain this complaint.
Point No.2:
11. Pilla Suryanarayana was admittedly a member in Road Safety Club for 84 months from 25.1.2007. The opposite party issued membership certificate under the original of Ex.A1. The insurance company i.e., Bajaj Allianz Life Insurance Company Ltd., issued certificate of insurance the original of Ex.A4 for the period from 28.2.2007 to 27.2.2008. It is a policy for group term life cover with assured sum of Rs.50,000/-. As observed above the opposite party is the policy holder and the member is the insured person-beneficiary.
12. DW.1 the general manager of the opposite party states at paragraph 16 of his affidavit: “All the members are eligible to receive complimentary insurance for a period of 3 years from the date of the membership of 3 premium payments starting from the date of current insurance policy”. The learned counsel for the opposite party emphasizes this point and submit that Pilla Suryanarayana died more than 3 years after starting membership and so he was out of insurance coverage. This submission cannot be accepted in view of the terms of membership noted on the reverse of Ex.A1. The relevant terms read as follows:
Insurance benefit : All members are eligible to receive complimentary insurance cover as follows:
- Silver card – One Two wheeler owned by them.
b. Classic Card - Personal Accident Insurance of the member.
The complementary insurance cover as per the scheme opted would be extended, to the period equivalent of membership of the scheme.
The member specifically acknowledge that the Issuer will not be liable in any manner what so ever by virtue of any insurance cover provided, and that the insurance company will be solely liable, in case of any claim, the member shall not hold the Issuer responsible for any matter arising out of or in connection with such insurance cover, whether for or in respect of any deficiency or defect in such insurance cover, recovery or payment of compensation, processing or settlement of claims or otherwise however, and all such matters shall be addressed to and sorted out directly with the insurance company.
The member specifically acknowledges that the insurance cover so provided will be available to the member or to the person nominated by him/her. The terms of the relevant insurance policy in force and only so long as the member is and remains member and on the membership being withdrawn (whether temporary or permanently) for whatsoever reason the benefit or such insurance cover shall automatically and ipso facto cease to be available from such date of cease of membership. Further the Member also agrees that even during the continuation of his Membership the Issuer may the anyone at their sole discretion and without giving any notice thereof to the Member or assigning any reason thereof) suspension withdraw or cancel the benefit of such insurance cover and there will be not binding obligation on the issuer to continue this benefit.
So when Suryanarayana took membership there was no limitation on the benefit for 3 years only. The benefit shall extend to the period equivalent of the membership. Pilla Suryanarayana had membership till 24.1.2014, but he died on 25.1.2011. There was no obligation on the insured Suryanarayana to pay any premium for the issue of policy or for extension. That apart the opposite party stated in paragraph 4 of the version and also in the affidavit of DW.1, that insurance company had issued certificate of insurance in favour of Pilla Suryanarayana for the period from 28.2.2010 to 27.2.2011 (the said certificate is not filed by either party). We therefore hold that Pilla Suryanarayana ought to have been covered under group insurance policy by the date of his demise.
13. Ex.A4 certificate was issued from one year only. The opposite party has an obligation to see that insurance is renewed periodically till the end of membership period. The opposite party has not withdrawn the facility. The opposite party states that the insurance company has to pay the assured amount and the opposite party cannot be made liable. They cite a ruling of National Commission in F.A.No.191/2009 between Road Safety Club Pvt., Ltd., Vs Smt Korli Lakshmi Narayana and other, decided on 3.11.2009, wherein it was held that entire liability is on insurance company and not on the club. In that case there appears to be no allegation of the policy becoming lapsed or non-renewal of policy. So that ruling is not applicable to the facts of the present case.
14. The complainants states that on enquiries with the insurance company they informed that the opposite party failed to pay the annual premium amount to the insurance company and did not renew the policy and so the claimants are not eligible for the insurance amount. In the notice dated 19.10.2012 the complainant had stated about this enquiry and reply given by the insurance company that the complainants are not eligible for the claim as the policy was not renewed. This notice was received by the opposite party on 20.2.2012 under the acknowledgement. The opposite party seems to have addressed a letter on 31.1.2011 to the 2nd complainant to arrange and submit some more documents. Again the opposite party addressed another letter Ex.A6 dated 26.3.2011 stating that they have not received policy in original and attested copy of legal heir certificate and asked to arrange the document. Thereafter it appears the complainant filed a petition for succession certificate in SOP. No.2/2011 on the file of II Additional Junior Civil Judge, Vijayawada and obtained orders on 30.8.2011. The complainant filed copy of 1st page of the order/certificate under Ex.A8. The opposite party has not stated anywhere that the opposite party had paid the premium regularly and kept the policy alive during the membership period of Pilla Suryanarayana till he died. Even in the written version filed by the opposite party no mention is made about the opposite party making payment of premium and obtaining insurance certificate from the insurance company. The opposite party will have the material to show how much premium they paid and for whose benefit it was paid under Road Safety Club scheme. Since the complainant himself had stated that the insurance company had negatived the claim on the ground that the policy was not renewed and premium was not paid, joining the insurance company also in the proceedings would not serve any purpose unless it is proved that the policy is kept alive the insurance company cannot be proceeded against. In the absence of any proof placed by the opposite party showing payment of premium and keeping the policy of Pilla Suryanarayana alive and when the complainant had subsequently stated that the policy was not renewed due to fault on the part of the opposite party, we must necessarily accept that there is deficiency on the part of the opposite party as it failed to keep the policy alive. Therefore we hold that there is deficiency on the part of the opposite party who has an obligation to see that the policy is kept alive during the lifetime of Pilla Suryanarayana till the expiry of membership. The opposite party cannot escape the liability on the basis of the terms of the policy absolving the opposite party from the liability when the fault is on the part of the opposite party in depriving the benefit of insurance coverage. Therefore we have no hesitation to hold that there is deficiency on the part of the opposite party.
Point No.3:
15. In view of the answer on point no.2 the complainants are entitled to the insurance benefit as compensation from the opposite party because of whom the claim could not be laid successfully against the insurance company. We also feel it proper to award interest on the said amount and to award costs assessed at Rs.1,500/-.
16. In the result this compliant is allowed in part and the opposite party is directed to pay a sum of Rs.50,000/- (Rupees fifty thousand only) to the complainants with interest thereon at the rate of 9% p.a., from the date of complaint i.e., 16.8.2013 till date of realization and to pay costs of Rs.1,500/- to the complainants 1 to 3 within one month from the date of receiving copy of the order. Complaint for rest of the reliefs is dismissed.
Dictated to steno, N. Hazarathaiah, transcribed by him, corrected by me and pronounced by us in the open Forum, this the 7th day of March, 2014.
PRESIDENT MEMBER MEMBER
Appendix of evidence
Witnesses examined
For the complainant: For the opposite party:
Pilla Nageswara Rao – PW.1 The General Manager of OP,
(by affidavit) DW – 1, (by affidavit).
Documents marked
On behalf of the complainant:
Ex.A1 25.01.2007 Photocopy of membership certificate.
Ex.A2 25.01.2011 Photocopy of letter issued by 2nd complainant to OP.
Ex.A3 31.01.2011 Photocopy of letter issued by OP to 2nd complainant.
Ex.A4 Photocopy of certificate of insurance.
Ex.A5 Original copy of death certificate.
Ex.A6 26.03.2011 Photocopy of letter issued by OP to 2nd complainant.
Ex.A7 11.03.2011 Photocopy of family member certificate.
Ex.A8 30.08.2011 Photocopy of certificate issued by II Addl. Junior Civil Judge, Vijayawada in S.O.P. No.6/2011.
Ex.A9 19.10.2012 Photocopy of legal notice got issued by complainant to OPs.
Ex.A10 Postal acknowledgement.
Ex.A11 20.11.2013 Photocopy of legal notice got issued by complainant to OPs.
Ex.A12 Postal acknowledgement.
Ex.A13 Original bank pass book, Bank of Maharastra.
Ex.A14 Postal acknowledgement.
On behalf of the opposite party:
PRESIDENT
