DISTRICT CONSUMER DISPUTES REDRESSAL FORUM,

PATIALA.

                                      Complaint No. CC/15/14 of 9.1.2015

                                      Decided on:        9.11.2015

Bhupinder Singh son of S.Darshan Singh, Paramjit Kaur w/o Bhupinder Singh and Davinder Singh s/o Bhupinder
Singh, all R/o 642, Ranjit Nagar, Patiala.

                                                                   …………...Complainant

                                      Versus

1.      The Branch Manager, State Bank of Patiala, Patiala Diesel Component Works, 521, 40-C, Urban Estate, Phase-II, Patiala.

2.      S.B.I.Life Insurance Company,Second Floor, Campus Bhawan, Sector-10, Plot No.3A, CBD Belapur, Navi Mumbai, 4000614, through its Managing Director.

                                                                   …………….Ops

                                      Complaint under Section 12 of the

                                      Consumer Protection Act.

                                      QUORUM

                                      Sh.D.R.Arora, President

                                      Smt.Neelam Gupta, Member

                                      Smt.Sonia Bansal,Member

Present:

For the complainant:   Sh.Umesh Sharma , Advocate

For Op No.1:                Sh.Dinesh Batish,Advocate

For Op No.2:                Sh.Puneet Gupta,Advocate          

                                         ORDER

D.R.ARORA, PRESIDENT

1. It is the case of the complainant that he had got a housing loan in a sum of Rs.17,50,000/- sanctioned from Op no.1 and Op no.1 got the loan account insured by Op no.2 namely SBI Life Insurance Company vide policy No.93000000203 on payment of the premium of Rs.1,19,499/- in respect of which additional loan was disbursed by Op no.1 and thus the total amount of the loan advanced to the complainant amounted to Rs.18,69,499/-, which was disbursed on 4.3.2011 repayable with interest @11.25% per annum.
2. The complainant went on making the payment of installments during the period 4.3.2011 to 15.1.2013. On 15.1.2013 the complainant made the payment of the entire loan amount of Rs.18,69,499/- .Out of total loan amount of Rs.18,69,499/- a sum of Rs.17,50,000/- was the principal amount and Rs.1,19,499/-pertained to the premium of the insurance of the loan account.
3. It is then the case of the complainant that Op no.1 had not provided any agreement of loan arrived at between the complainant and the Op. The Op also failed to provide the insurance policy to the complainant. The said act of the Op is said to be a deficiency in service  as also unfair trade practice.
4. After the complainant having deposited a sum of Rs.18,69,499/- on 15.1.2013, the Op pressurized the complainant to deposit other hidden charges and thus the total amount deposited by the complainant came to Rs.22,17,876/- as per the statement of account issued by the Op.
5. It is further the case of the complainant that  on 2.2.2013, Op no.2 had issued letter alongwith cheque No.992193 dated 21.2.2013 for Rs.39460/- on account of surrender value having made a reference to the surrender request of the complainant in respect of master policy No.93000000203.
6. The complainant got Op no.1 served with a legal notice on 3.3.2014 but the Op denied the claim of the complainant and therefore, the act of Op no.1 is said to be a deficiency in service. Consequently the complainant brought this  complaint against the Op No.1 under Section 12 of the Consumer Protection Act,1986 ( for short the Act) for a direction to refund the premium of Rs.1,19,499/- paid by Op no.1 to Op no.2 in respect of the insurance of the loan account with interest @18% per annum ; to pay him Rs.50,000/- by way of compensation on account of the deficiency and unfair trade practice; to pay him Rs.5000/- by way of compensation on account of the harassment and the mental agony experienced by the complainant; to award him Rs.5500/- towards the costs of the complaint and also to supply the copies of the loan agreement and of the insurance policy.
7. Here, it may be noted that initially the complaint was brought against Op no.1 only, who on appearance filed the written version. It is admitted by Op no.1 that the complainant had sanctioned the loan amount of Rs.18,69,000/- but it is denied that the same was sanctioned with any condition to get the loan insured. The bank never lays any condition to get the loan insured. The bank officials only explain the benefits of getting the loan insured that in case of any mis-happening or unfortunate death of the borrower, during the currency of the loan , the liability of the repayment does not fall upon the legal heirs and  that the insurance company pays all the entire loan outstanding at the time of the death of the borrower.
8. It is denied that during the period 4.3.2011 to 15.1.2013, the complainant had been depositing the installments of the loan or that on 15.1.2013 he made the single payment of Rs.18,69,499/- i.e. Rs.17,50,000/- towards the principal and Rs.1,19,499/- towards the premium of the insurance, which payment was in addition to the installments deposited by the complainant.
9. As a matter of fact, the complainant had stopped repaying the loan installments w.e.f. June,2011 and restarted paying the same w.e.f.December,2011. The complainant had also not deposited the installment in the month of January,2012. Therefore, the loan account became NPA. The Op bank issued the notices dated 15.12.2012, 24.3.2012,2.6.2012 and 30.6.2012 having disclosed the irregularities of the loan account. The bank recovered the outstanding amount alongwith interest in terms of the agreement arrived at between the complainant and the Op. A sum of Rs.19,90,022.44 was due as on 15.1.2013 towards the principal and a sum of Rs.1,04,553.72 was due towards interest, Rs.1307.10 was due being penal interest and a sum of Rs.6700/- was charged towards the publication charges in respect of the news paper and thus the total amount outstanding against the complainant was Rs.21,02,283.26 and the same was got deposited by the Op from the complainant.
10. It is denied that the Op had not provided the agreement of loan to the complainant. The insurance policy was kept on record in the loan file of the borrower. It is denied that on 15.1.2013 when the complainant deposited Rs.18,69,499/- he was pressurized by the Bank to deposit the hidden charges or that the total amount of the loan repaid by the complainant amounted to Rs.22,17,876/-. The bank never pressurized the complainant to recover any hidden charges from the complainant. The complainant was repeatedly informed regarding the amount overdue having made the personal visits to the residence of the complainant as well as through telephone but the complainant failed to repay the same. The complainant was served with a demand notice under SARFAESI Act, which was duly received by the complainant on 19.10.2012.
11. It is further averred by the Op that the complainant had surrendered  the housing loan insurance policy with SBI Life and the surrender value of Rs.39460/- has been provided  by the SBI Life to the complainant. The copy of the surrendered policy could not be provided by the Op to the complainant. The complainant is not entitled to any other refund.After controverting the other averments of the complaint, going against the Op, it was prayed to dismiss the complaint.
12. Here, it may be noted that  Op no.2 namely SBI Life Insurance Company was joined as an Op vide order dated 10.4.2015 on an application moved by Op no.1, alleging that Op no.2 was a necessary party and that the complaint may be dismissed on account of non joinder of Op no.2.
13. Op no.2 on appearance filed the written version having raised certain preliminary objections, interalia, that the Forum lacks territorial jurisdiction to try the complaint and that the complaint is barred by limitation. As regards the facts of the complaint, it is stated that the complainant had been supplied with insurance cover vide membership form No.933469543 dated 4.3.2011 under Dhanraksha Plus LPPT Group Insurance Scheme under Master Policy No.93000000203 issued in favor of the SBOP. The risk commenced on 10.3.2011 for the sum assured of Rs.18,69,499/- at the inception and having varied thereafter as detailed in Annexure 1. A sum of Rs.1,19,499/- was received towards the  insurance premium and service tax. The op had never compelled the complainant  to enter into any contract of insurance. Ops no.1&2 are two different legal entities. Op no.2 deals in life insurance business and is registered  under Section 3 of the Insurance Compance Act, 1938. Op no.1 is a bank and is the master policy holder in whose favor master policy was issued. The Op is not responsible for the acts, omissions or commissions of Op no.1
14. The Op no.1 had received a request from op no.1 for cancellation of the insurance cover and in accordance with the terms and conditions of the master policy an amount of Rs.39,460/- was paid to the master policy holder vide cheque No.992193 dated 21.2.2013 and the same has been realized on 15.2.2013. The calculation of the surrendered amount was made as under:     

Surrender Amount=(45% of the premiums paid less taxes) X

(Unexpired term/Total Term) X ( Sum assured benefit at the time of surrender/Sum assured at inception)

The surrender value is determined on the basic premium and not on the service tax component, which has to be paid to the Govt. of India.

15. The Op is not liable to pay any other amount to the complainant. There is no short payment to have been made by the Op. The surrender value is paid strictly as per the terms and conditions of the master policy and therefore, the act of the Op cannot be said to be a deficiency in service. The Op has denied having received any legal notice dated 3.3.2014 from the complainant.
16. It is also the plea taken up by the Op that the complainant is disputing the terms and conditions of the insurance cover which was issued in March,2011. The cause of action, if any, had accrued in March, 2011 and the complaint filed after a gap of four years is said to be barred by limitation. The complainant has not filed any application for the condonation of delay. After controverting the other allegations of the complaint, going against the Op, it was prayed to dismiss the complaint.
17. In support of his case, the complainant produced in evidence Ex.CA his sworn affidavit alongwith documents Exs.C1 to C7 and closed his evidence.
18. On the other hand, on behalf of Op no.1, it’s counsel tendered in evidence Ex.OPA, the sworn affidavit of Sh.Dhanya KP,Deputy Manager (Legal) of the Op, Ex.OPB, the sworn affidavit of Sh.Ashutosh Kumar, Branch Manager of Op no.1 alongwith documents Exs.OP1 to OP11 and closed the evidence.
19. The counsel for Op no.2 tendered in evidence the documents Exs.OP12 to OP16 and closed the evidence.
20. Op no.2 filed the written arguments. We have examined the same, heard the learned counsel for the parties and gone through the evidence on record.
21. The complainant has sought the following reliefs: (i) to supply him the copies of the loan agreement and of the insurance policy; (ii) to refund the amount of the premium of Rs.1,19,499/- paid by the complainant towards the insurance policy;(iii) to pay him Rs.50,000/- by way of compensation on account of the deficiency of service;(iv) to pay him the compensation in a sum of Rs.5000/- on account of the harassment and the mental agony experienced by him and (v) to provide him the costs of Rs.5500/- on account of the litigation.
22. Admittedly the complainant had raised the housing loan from Op no.1 on 4.3.2011 and on the same day his loan account was insured by Op no.2 and the complainant admittedly had raised the loan in respect of the insurance premium amount of Rs.1,19,499/- from Op No.1. In case the complainant was  not provided the copy of the loan agreement, the cause of action to file the complaint had arisen in favor of the complainant on 4.3.2011 itself but he never made any complaint regarding the non supply of the copy of the loan agreement within a period of two years from the date of the execution of the agreement. Similarly he never made any complaint regarding the non supply of the copy of the insurance policy by Op no.2 or by Op no.1. The cause of action again in that regard had accrued on 4.3.2011. The complaint now brought by the complainant asking for the supply of the copies of the loan agreement and of the insurance policy after the expiry of a period of three years and more than nine months, is hopelessly barred by limitation.
23. It may however, be noted that as per the plea taken up by Op no.2 the insurance policy was kept on record in the file of the complainant. We can understand that the insurance policy had to be kept by Op no.1 in its record because in case of any eventuality i.e. the death of the insured, Op no.1 would have  claimed the benefit under the policy from Op no.2 on behalf of the complainant and therefore, there was no deficiency on the part of Op No.1 in having retained the insurance policy in its record. It is also important to note that the relief now sought for by the complainant asking for the copy of the insurance policy after his having surrendered the policy has become redundant  especially when  he has admittedly been paid the surrender value of Rs.39,460/- by Op no.2 through Op no.1 vide cheque dated 21.2.2013( copy Ex.C6) sent by Op no.2 to Op no.1 vide letter Ex.C5 dated 23.2.2013.
24. Now coming to the other part of the relief sought by the complainant regarding the refund of the entire amount of the insurance premium of Rs.1,19,499/- , the complainant having enjoined the benefit of the insurance upto 15.1.2013 when he made the written request to Op no.2 to refund the premium for the remaining period, we fail to understand as to how he could claim the refund of the insurance premium for the entire period. The insurance of the loan amount was valid for the period 4.4.2011 to 4.3.2026 as would appear from  the SBI Life-Dhanrkasha +LPPT membership form, Ex.OP14.Ex.OP15 is the request made by Op no.1 to Op no.2 for the refund of the insurance premium and the same was attached with the application moved by the complainant, the photo copy of which was produced alongwith the record. It is very much written in the said application by the complainant that he had adjusted the housing loan and he requested for the refund of the premium for the remaining period. The Ops have also disclosed the criteria in the matter of calculating the surrender amount in its written version but the complainant has not challenged the same in any manner in his sworn affidavit. Even the learned counsel for the complainant could not challenge the same at bar during the course of the arguments. Therefore, the surrender value of Rs.39,460/- having been paid to the complainant by Op no.2 in accordance with the terms and conditions of the insurance policy, the complainant had no cause of action to ask for the refund of the entire amount of the insurance premium.
25. It is suffice to note that the complainant has not, in any way challenged the correctness of the statement of account got by him from Op no.1 showing a sum of Rs.22,17,876/- due and payable by him in respect of his loan account, in the absence of which it could not be  said by the complainant that  he was burdened with any hidden charges in the statement of account. Moreover, the complainant adjusted his loan account without any demur and protest as would appear from the request for surrender moved by him before Op no.2.
26. As an upshot of our aforesaid discussion, it would appear that whereas the complaint for the part of the relief i.e. supply of the copies of the loan agreement and of the insurance policy is barred by limitation, we do not find any substance in the complaint in respect of the refund of the entire amount of the insurance premium and consequently the same is hereby dismissed.

Pronounced

Dated:9.11.2015

                   Sonia Bansal                Neelam Gupta                        D.R.Arora

          Member                        Member                                  President