BEFORE THE DISTRICT CONSUMER DISPUTES

REDRESSAL FORUM, JALANDHAR.

Complaint No.178 of 2015

Date of Instt. 28.04.2015

Date of Decision :20.04.2016

Jaswinder Kaur aged about 56 years widow of Davinder Singh R/o H.No.5, Ward No.3, Gali No.6, Roop Nagar, Bhogpur, District Jalandhar.

..........Complainant

Versus

1. SBI Life Insurance Co.Ltd., Central Processing Centre, Kapas Bhawan, Building No.3-A, Sector No.10, CBD Belapur, Navi Mumbai-400614.

2. State Bank of India, Bhogpur, District Jalandhar through its Branch Manager.

.........Opposite parties

Complaint Under the Consumer Protection Act.

Before: S. Bhupinder Singh (President)

Ms. Jyotsna Thatai (Member)

Sh.Parminder Sharma (Member)

Present: Sh.IS Bhatia Adv., counsel for the complainant.

Sh.Vikas Sharma Adv., counsel for the OP No.1.

Sh.PMS Narang Adv., counsel for the OP No.2.

Order

Bhupinder Singh (President)

1. The complainant has filed the present complaint under the Consumer Protection Act against the opposite parties on the averments that complainant and her husband Davinder Singh took a housing loan of Rs.10 Lacs from OP No.1 vide SBI Home Loan TL Account No.32965291041 which was repayable in monthly installments alongwith interest @ 10.25% per annum. The OP No.2 had got the loan amount insured in the name of Davinder Singh co-borrower vide insurance policy No.700000000310 from OP No.1 under SBI Rinn Raksha House Loan Scheme and had debited the insurance premium to the loan account of the complainant. The OPs had assured the complainant and her husband that in case of death of Davinder Singh, before liquidation of the loan amount, the entire outstanding amount in the loan account shall be adjusted by the OP No.1 with the insurance claim against the aforesaid policy. Unfortunately, Davinder Singh, the husband of the complainant expired on 25.9.2013 due to Cardiac Arrest. After the death of Davinder Singh, the complainant had lodged insurance claim with OP No.1 and had submitted all the required documents. The official of the OPs had done the verification and had assured the complainant that the claim shall be settled in due course. The complainant was shocked to receive letter dated 25.9.2014 from OP No.1 that the company had repudiated the claim lodged by complainant on the ground that the deceased had made false good health declaration. The OPs had got Davinder Singh medically examined before issuing the insurance policy. There is deficiency in service on the part of the OP No.1 in repudiating the claim of the complainant. The complainant is not liable to pay the amount due and payable against the SBI Home Loan TL Account No.32965291041 as on 25.9.2013 with upto date accrued interest. The branch manager of OP No.2 had instructed the complainant to stop paying the installments after the death of her husband and had assured that the loan account shall be adjusted by OP No.1. The complainant is getting monthly pension @ Rs.10095/- after the death of her husband vide PPO No.3734 from Punjab Agricultural University, Ludhiana which is being credited to S.B.Account No.20125251104 of the complainant held with the OP No.2. The said amount can not be attached by OP No.2 but the OP No.2 is unduly harassing the complainant by deducting the loan installments from the pension account of the complainant. On such averments, the complainant has prayed for directing the OP No.1 to pay a sum of Rs.9,95,366/- alongwith interest and directing the OP No.2 to refund the amounts withdrawn from the account of the complainant. She has also claimed compensation and litigation expenses.

2. Upon notice opposite parties appeared and filed their written statements. In its written statement, OP No.1 pleaded that the life insurance contract is a contract of Utmost Good Faith, wherein the proponent is duty bound to disclose everything concerning his/her health, habits and other related matters which are within his/her knowledge at the time of making the proposal. DLA Davinder Singh committed a breach of principle of Utmost Good Faith by suppressing the material facts while applying for insurance cover that he was habitual of consumption of alcohol prior to the date of commencement of the policy. It is clear from the police report and other statements gathered at the time of death that DLA was alcoholic prior to the date of commencement of the insurance cover. OP No.1 denied other material averments of the complainant.

3. In its separate written statement, OP No.2 pleaded that Jaswinder Kaur and Davinder Singh took a housing loan of Rs.10 Lacs from OP No.2. Davinder Singh has applied for insurance cover under Rinn Raksha Group Insurance Scheme under master policy No.700000000310 regarding his own loan taken from OP No.2 and the risk under the said policy commenced from 2.5.2013 for a sum insured of Rs.1120620/-. However, the sum assured is payable as per the terms and conditions of the policy issued by the OP No.1. OP No.2 denied that DLA Davinder Singh expired due to cardiac arrest. As per the police record and as per the statement recorded during the investigation by the police, DLA Davinder Singh died due to excess consumption of alcohol. It is wrong that OP No.2 had assured the complainant that the claim shall be settled in the due course. It is submitted that the same is interse between the complainant and OP No.1. During investigation of claim, OP No.1 had transpired that deceased Davinder Singh was having a habit of consumption of alcohol which was not mentioned in the membership proposal form and for the said reasons OP No.1 had repudiated the claim of the complainant. It is wrong that OP No.1 is liable to pay sum of Rs.995366/- plus upto date accrued interest in the housing loan account to the complainant towards the settlement of insurance claim. OP No.2 denied that OP No.2 is liable to refund the amounts debited from the pension account of the complainant w.e.f. 25.9.2013. It is worthwhile to mention that the complainant had herself authorized the OP No.2 to debit the said amounts from that account towards the installments of loan. OP No.2 denied other material averments of the complaint.

4. In support of her complaint, learned counsel for the complainant has tendered into evidence affidavit Ex.CA alongwith copies of documents Ex.C1 to Ex.C10 and closed evidence.

5. On the other hand, learned counsel for opposite party No.1 has tendered affidavit Ex.OP1/A alongwith copies of documents Ex.OP1/1 to Ex.OP1/12 and closed the evidence. Further learned counsel for the OP No.2 has tendered affidavit Ex.OP2/A alongwith copies of documents Ex.OP2/1 to Ex.OP2/3 and closed the evidence.

6. We have carefully gone through the record and also heard the learned counsels for the parties.

7. From the record i.e. pleadings of the parties and the evidence produced on record by both the parties, it is clear that complainant Davinder Singh husband of the complainant alongwith complainant took joint housing loan of Rs.10 Lacs from OP No.2 vide Home Loan TL Account No.32965291041 which was sanctioned on 29.4.2013 and credited to the aforesaid account of the complainant. The said loan was got insured in the name of Davinder Singh co-borrower from OP No.1 vide insurance policy No.700000000310 under SBI Rinn Raksha House Loan Scheme Ex.OP1/1. OP No.2 debited the insurance premium to the aforesaid joint loan account of complainant and Davinder Singh. As per version of complainant, Davinder Singh expired on 25.9.2013 due to cardiac arrest. After the death of Davinder Singh, complainant lodged the insurance claim with OP No.1 by submitting all the required documents. However, OP No.1 repudiated the claim lodged by complainant vide letter dated 25.9.2014 Ex.C6 on the ground that deceased life assured Davinder Singh (hereinafter referred to as DLA) had given a false good health declaration at the time of taking the policy i.e. in the proposal form Ex.OP1/2. The learned counsel for the complainant submitted that the DLA had not made any false good health declaration alleged by OP No.1. The complainant further submitted that the branch manager of OP No.2 has instructed the complainant to stop paying the installments and assured that loan account shall be adjusted by OP No.1 but the OP No.2 is threatening to attach the saving bank account of complainant bearing No.20125251104 of the complainant with OP No.2. The learned counsel for the complainant submitted that all this, amounts to deficiency in service on the part of the OPs qua the complainant.

8. Whereas the case of the OP No.1 is that insurance contract is a contract of utmost good faith and it is first and foremost duty of the propose to disclose everything concerning his/her health, habits and other related matters at the time of making the proposal. DLA Davinder Singh committed a breach of principle of Utmost Good Faith by suppressing the material facts while filling in the proposal form for insurance cover that he was habitual of consumption of alcohol prior to the date of commencement of the policy. As per record i.e. statements gathered after the death of DLA, that DLA was alcoholic prior to the date of commencement of the insurance cover. All this shows that the DLA obtained the insurance cover from OP No.1 fraudulently. As per the investigation report Ex.OP1/4 the employer of DLA gave certificate that DLA was living alone in the staff quarter near his office. From 16.9.2013, he had been absented from his office and on 25.9.2013 when the director of the centre sent some peon to deliver him a message to join the duty. The peon on return told the office that his house is bolted from inside and a foul smell is coming from his house. After that his wife was called from his town and police was also informed. The DLA was found dead and as per statements given to the police by his wife and other relatives as well as co-employees of the DLA, DLA was alcoholic and his death had occurred due to excessive drinking. The death of DLA has taken place within one year of taking policy. The DDR in this regard is Ex.OP1/7, statement of Majinder Saini D/o DLA Davinder Singh is Ex.OP1/8, statement of co-employee Manjit Kumar is Ex.OP1/9 and statement of Jaswinder Kaur Wd/o DLA Davinder Singh is Ex.OP1/10. The learned counsel for the OP No.1 submitted that the OP No.1 has rightly repudiated the claim of the complainant.

9. Whereas, the case of the OP No.2 is that Jaswinder Kaur complainant and Davinder Singh took a housing loan of Rs.10 Lacs from OP No.2. Davinder Singh co-borrower had applied for insurance cover under Rinn Raksha Group Insurance Scheme and he got master policy No.700000000310 covering his own loan taken from OP No.2. The risk under the policy commenced from 2.5.2013 for a sum insured of Rs.1120620/- and the policy is governed by terms and conditions of the policy Ex.OP1/1. OP No.2 denied that DLA Davinder Singh expired due to cardiac arrest. As per the police record and statements recorded during the investigation by the police, it was found that DLA Davinder Singh died due to the excess consumption of alcohol. OP No.2 denied that they assured the complainant that the claim shall be settled by OP No.1 because this matter of insurance claim is inter-se between the complainant and OP No.1. As during investigation, it was found that Davinder Singh DLA was having a habit of consumption of alcohol which was not mentioned in the proposal form while taking the policy by the DLA. The OP No.1 has repudiated the claim of the complainant. The OP No.1 further submitted that the OP No.2 is not liable to refund the amount debited from the pension account of the complainant towards the aforesaid loan account as complainant herself has authorized OP No.2 to debit the said amount from her saving bank account, towards the installments of loan. The learned counsel for the OP No.2 submitted that as per the statement of account Ex.OP2/3, a sum of Rs.9,95,366/- was due payable by the complainant towards the loan account and the complainant is bound to pay this amount to the OP No.2 bank. The learned counsel for the OP No.2 submitted that there is no deficiency in service on the part of the OP No.2 qua the complainant.

10. From the entire above discussion, we have come to the conclusion that complainant alongwith her husband Davinder Singh took housing loan of Rs.10 Lacs from OP No.2 vide SBI Home Loan TL Account No.32965291041 on 29.4.2013 which was repayable in monthly installments. Davinder Singh co-borrower got insurance policy bearing No.700000000310 from OP No.1 under SBI Rinn Raksha House Loan Scheme that in case of death of Davinder Singh before liquidation of the loan amount, the entire outstanding amount in the loan account shall be adjusted by OP No.1 under the insurance policy. Davinder Singh co-borrower expired on 25.9.2013. The complainant lodged insurance claim with OP No.1 with the request that the loan amount outstanding in the aforesaid account with OP No.2 shall be adjusted. The OP No.1 got the matter investigated and the investigation report in this regard is Ex.OP1/4 and the finding of the investigation report is Ex.OP1/4A in which the investigator submitted that as per report from the employer of Davinder Singh insured, he had been absent from the office from 16.9.2013. On 25.9.2013 the director of the centre sent some peon to deliver him a message to join the duty. The peon on return told the office that his house is bolted from inside and a foul smell is coming from his house. After that his wife was called from his town and police was also informed. The Davinder Singh insured was found dead. As per statements given to the police by the wife of the Davinder Singh i.e. complainant in the present complaint and others, the insured was alcoholic and his death might have occurred due to excessive drinking alcohol. As per the police report Ex.OP1/6 and Ex.OP1/7, the DLA Davinder Singh was alcoholic and he died of excessive drinking alcohol. The police recorded the statement of Majinder Saini D/o DLA Davinder Singh is Ex.OP1/8 under the signature of Manjinder Saini who categorically stated that her father Davinder Singh DLA was in the habit of taking excessive alcohol and he died of excessive drinking of alcohol, similarly statement of complainant Jaswinder Kaur wife of DLA Davinder Singh was also recorded which is Ex.OP1/10 who also stated that her husband was in the habit of taking excessive alcohol and he died due to taking of excessive alcohol. The statement of Jaswinder Kaur Ex.OP1/10 is duly signed by Jaswinder Kaur. Similarly statement of Manjit Kumar co-employee of DLA Davinder Singh was also recorded under his own signature who also stated that DLA Davinder Singh was in the habit of taking excessive alcohol and he used to reside alone in the quarter of the Paddy Research Centre and he was found dead in the quarter of Paddy Research Centre as a result of taking excessive liquor/alcohol. All this fully proves that Davinder Singh DLA was in the habit of taking excessive liquor/alcohol and he died as a result of taking excessive liquor. The complainant could not rebut these documentary evidence produced by the OPs. Said Davinder Singh while taking the insurance policy Ex.OP1/1, filled in the proposal form Ex.OP1/2 in which he categorically stated that he was not taking alcohol, in clause 7(ix)(b). He was questioned whether he consumed more than two pegs of alcohol per day in any form? If yes, please provide the type of alcohol any, daily quantity consumed and DLA Davinder Singh replied that he is not taking alcohol. He also not mentioned the type of alcohol and quantity he used to consume per day. All this fully proved that DLA Davinder Singh got the insurance policy Ex.OP1/1 from OP No.1 by concealment of facts. The contract of insurance is of utmost faith and any concealment of facts by the insured while filling in the proposal form, makes the contract of insurance void abinitio. The OP No.1 was, therefore, justified in repudiating the claim of the complainant under the insurance policy in question regarding the death of Davinder Singh DLA.

11. Consequently, we hold that complaint is without merit and same is hereby dismissed with no cost. Copies of the order be sent to the parties free of costs under rules. File be consigned to the record room.

Dated Parminder Sharma Jyotsna Thatai Bhupinder Singh

20.04.2016 Member Member President