STATE CONSUMER DISPUTE REDRESSAL COMMISSION
BIHAR, PATNA
Appeal No. 88 of 2016
1. Zonal Head, Sahara India Pariwar, Zonal Office, Sahara India Bihar, Boring Road Crossing, Patna-01
2. Branch Manager, Sahara India Pariwar, Branch Office, Harnaut Ranchi Road, Harnaut, PO & PS- Harnaut, District- Nalanda and
3. Mritunjay Kumar Dubey, Assistant, Sahara India Pariwar, Branch Office, Harnaut Ranchi Road, Harnaut, PO & PS- Harnaut, District- Nalanda
… Complainant/Appellant
Versus
1. Shakuntala Devi, Wife of Om Prakash Saw; and
2. Om Prakash Saw son of Late Kesho Saw both resident of Village- Rahui, PO & PS- Rahui, District- Nalanda
…. Complainants/ Respondents no. 1 & 2
3. National Insurance Co. Ltd. through the Branch Manager, 4th Floor, 43, Jiwan Bhwan, Hazratganj, Lucknow-
…. Opposite Party No. 4/Respondent No. 3
Counsel for the Appellant: Adv. Manish Kumar Singh
Counsel for the Respondent no. 1 & 2: Adv. Raju Kumar Singh
Counsel for the Respondent No. 3: Adv. Rajesh Chandra Narayan
Before,
Hon’ble Mr. Justice Sanjay Kumar, President
Mr. Ram Prawesh Das, Member
Dated 12.04.2023
As per Sanjay Kumar, President.
O r d e r
Earlier, appellants Sahara India had filed an appeal being appeal no. 88 of 2016 against the judgment and order dated 03.02.2016 passed in Complaint case no. 37 of 2011 which was dismissed by order dated 21.06.2017 passed by this Commission.
Against the aforesaid order passed by the State Commission, appellant-Sahara India filed Revision case before the National Commission being Revision Petition no. 458 of 2018 and by order dated 05.06.2018 the judgment and order passed by State Commission was set aside and matter was remanded to the State Commission to decide the appeal on merits by a speaking order after giving reasonable opportunity of being heard to all the parties. Appeal was heard at length giving reasonable opportunities of hearing to all the parties and after hearing all the parties present order is being passed.
Appellants Sahara India through its Branch Manager, (O.P. no. 1 to 3) have filed present appeal for setting aside the order dated 03.02.2016 passed by Ld. District Consumer Disputes Redressal Forum, Nalanda at Biharsharif in Complaint Case no. 37 of 2011 whereby and whereunder the Ld. District Consumer Forum has directed appellants O.P. no. 1 to 3 to pay to the complainants sum assured amount of Rs. 4 lac and also pay Rs. 15,000/- as compensation for physical and mental harassment and Rs. 1000/- as cost of litigation within 40 days failing which interest @9% per annum shall become payable.
Briefly stated the facts of the case is that complainants are parents of Anil Kumar who had obtained two policies under Sahara Rajat Scheme option C by depositing Rs. 10,000/- and Rs. 10,000/- each on 31.03.2003 in which both complainants were nominees having 50% share. As per clause 18 of scheme accidental death of the certificate holder was covered and accidental benefit of Rs. 2,00,000/- would be payable to nominee of said certificate.
It is further stated in the complainant petition that son of the complainant died in a road accident on 06.07.2008 for which FIR was lodged giving rise to Hazaribagh PS case no. 657 of 2008 under sections 279/338/304A of IPC and after investigation police found the case to be true and submitted charge sheet against the accused.
After accidental death of insured Anil Kumar, nominee (complainants) under under both certificates became entitled to get accidental death benefit under terms and condition of clause 18 of the certificate.
Complainant submitted application along with death certificate, FIR, Post Mortem report and two certificate, to the appellants and appellants paid the deposited amounts with interest total Rs. 16,916/- vide two cheques dated 17.07.2009 in joints name, but did not pay the insured amount. Legal notices were send to appellants but still insured amount was not paid as such complainant filed complaint case before the District Consumer Forum, Nalanda for payments of insured amount with interest as well as compensation for physical and mental harassment and cost of litigation giving rise to complaint case no. 37 of 2011.
Appellants filed their written statement stating therein that the complaint case is barred by limitation as the cause of action had arisen on 06.07.2008 but, the complaint was filed on 08.06.2011 after expiry of 2 years as such was time barred. It was further stated that complainant have accepted the death maturity amount with interest on 17.07.2009 and had raised no objection. They further stated that complainants are not consumers as such complaint case was not maintainable.
It was further stated in their written statement that case is bad for non-joinder of necessary parties as National Insurance Company Ltd. has not been made party although, it is a necessary party. The insurance claim is maintainable against the insurance company and not against the appellants who had obtained the Group accidental/personal insurance policy to cover life risk of their certificate holder without charging any fee or premium. They have further stated that arbitration award has already been passed on 19.10.2011 as such the complaint case was not maintainable.
It was further stated that the complainants had intimated the appellants about the death of account holder on 05.05.2009 and the claims were settled on 17.07.2009. Complainants had raised their insurance claim by sending legal notice which was forwarded to the insurance company on 10.11.2010 and insurance company rejected their claim on 12.11.2010.
National Insurance company was added as opposite party no. 4 and have filed their written statement and have stated therein that they have not received the relevant documents such as copy of policy of insurance , certificate of investment, death certificate, copy of FIR, postmortem report. The insurance company under the contingency policy had insured the investors who made investments in the company of opposite party no. 1 to 3 i.e Sahara India Ltd. Complainants have not secured insurance policy directly from the insurance company as such they are not consumers of insurance company. It was lastly stated that in terms and conditions of the policy intimation of death of the investor has to be made within one month from his death. Claim has been submitted after one year i.e beyond stipulated period as such claim has been repudiated.
The District Consumer Forum after hearing the parties and considering the materials available on record held that it is an admitted fact that son of complainant had obtained two certificates in Sahara Rajat Scheme option C under which insurance cover was also provided according to which if certificate holder dies in accident then the nominees are entitled to insured amount of Rs. 2,00,000/- against each certificate.
It was held by the District Consumer Forum that son of complainant Anil Kumar had obtained two certificates in scheme of Sahara India Ltd. and in terms of clause 18 in case of death of certificate holder nominees are entitled to receive compensation of Rs. 2, 00,000/- each and as such said compensation amount is to be paid by appellants/Sahara India Ltd.
The District Consumer Forum has held that there is neither any contract between the certificate holder Anil Kumar and National Insurance Company nor complainants are consumers of National Insurance Company. Contract is between Appellant and certificate holder which has not been denied by either of the parties as such liability to pay the sum assured amount is of appellants and not opposite party no. 4. (Insurance company) Appellants can separately deal with O.P. no. 4 (Insurance company).
Aggrieved by the judgment and order passed by The DCF, in which liability to pay the sum assured amount has been fasten on the appellants Sahara India Ltd., present appeal has been filed by appellants against said finding of the District Consumer Forum.
Having heard counsel for the parties it is an admitted fact that the life of account holder was insured by the O.P. no. 1 to 3 by a contract entered between O.P. no. 1 to 3 and O.P. no. 4. as such account holder is beneficiary of such contract and it is for the O.P. no. 4 to indemnify O.P no. 1 to 3 by paying the sum assured amount to the nominee of deceased account holder.
Complainants are consumer qua National Insurance Co. Ltd. Complainants come within the definition of consumer under the Consumer Protection Act, being the beneficiary of the insurance policy. The Apex Court in case of Canara bank vs. M/s United India Insurance Company Ltd. since reported in 2020 (3) SCC 455 has held that absence of privity of contract is not a bar for maintaining a complaint against a service provider.
24. To decide these issues, it would be apposite to refer to the definition of ‘consumer’ under Section 2(d) of the Act, which reads as follows: “2 Definitions. (1) In this Act, unless the context otherwise requires, xxx xxx xxx
(d) "consumer" means any person who,
(i) buys any goods for a consideration which has been paid or promised or partly paid and partly promised, or under any system of deferred payment and includes any user of such goods other than the person who buys such goods for consideration paid or promised or partly paid or partly promised, or under any system of deferred payment, when such used is made with the approval of such person, but does not include a person who obtains such goods for resale or for any commercial purpose; or
(ii) hires or avails of any services for a consideration which has been paid or promised or partly paid and partly promised, or under any system of deferred payment and includes any beneficiary of such services other than the person who hires or avails of the services for consideration paid or promised, or partly paid and partly promised, or under any system of deferred payment, when such services are availed of with the approval of the first mentioned person…;”
25. The definition of consumer under the Act is very wide and it not only includes the person who hires or avails of the services for consideration but also includes the beneficiary of such services who may be a person other than the person who hires or avails of services.
26. Taking the issue of privity of contract, we are of the considered view that as far as the Act is concerned, it is not necessary that there should be privity of contract between the insurance company and the claimants. The definition of consumer under Section 2(d) quoted hereinabove is in 2 parts. Subclause (i) of Section 2(1)(d) deals with a person who buys any goods and includes any user of such goods other than the person who buys such goods as long as the use is made with the approval of such person. Therefore, the definition of consumer even in the 1st part not only includes the person who has purchased but includes any user of the goods so long as such user is made with the approval of the person who has purchased the goods. As far as the definition of the consumer in relation to hiring or availing of services is concerned, the definition, in our view, is much wider. In this part of the section, consumer includes not only the person who has hired or availed of the services but also includes any beneficiary of such services. Therefore, an insured could be a person who hires or avails of the services of the insurance company but there could be many other persons who could be the beneficiaries of the services. It is not necessary that those beneficiaries should be parties to the contract of insurance. They are the consumers not because they are parties to the contract of insurance but because they are the beneficiaries of the policy taken out by the insured.
The insurance company has not denied their liability to indemnify O.P. no. 1 to 3 by paying the sum assured amount to the complainant. Only objection raised was that intimation of death of the account holder/filing of claim was not made within the stipulated period of one year as such they had repudiated the claim of complainants. Once they have repudiated the claim as intimation/filing of claim was given after one year of death they can not take any other plea to repudiate the claim of claimants. The genuine and bonafide claim cannot be denied on such technical grounds.
National Insurance Company (NIC) has failed to comply with the guidelines issued by the Insurance Regulatory Development Authority (IRDA) bearing reference no. 015/IRDA/Life/Circular/GI Guidelines/2005 dated 14.07.2005 wherein under clause 7 to 12, it has been categorically stated that in cases of Group Insurance Policies, the insurer shall be liable to compensate the insured in case of accidental death of the insured.
NIC has failed to comply with the IRDA circular bearing reference no. IRDA/HLTH/MISC/CIR/216/09/2011 dated 20.09.2011 regarding delay in claim intimation/documents submission with respect to all life-insurance contracts and non-life individual and group insurance contracts which allowed the Insurance Companies to condone the delay in submission of insurance documents for payment of insurance amount.
The accidental insurance is additional facility provided through NIC and no additional premium or fees were charged from the deceased. Section-41 of the Indian Contract Act, 1872 makes it clear that an accidental insurance compensation can be claimed only against an insurance company.
In said view of the matter the judgment and order passed by District Consumer Forum, Nalanda is modified to the extent that the sum assured amount of Rs. 4 lac with interest shall be paid to the mother of deceased namely Shakuntala Devi as she is the only class one heir of deceased being mother of the deceased. This appeal is disposed of with aforesaid modification in the judgment and order further, the rate of interest is reduced from 9% to 8%.
(Ram Prawesh Das) (Sanjay Kumar,J)
Member President
Md. Fariduzzama
