BEFORE THE A.P.STATE CONSUMER DISPUTES REDRESSAL COMMISSIONHYDERABAD
FA.No.875/2006 AGAINST C.D.NO.116/2005, DISTRICT CONSUMER FORUM, SRIKAKULAM.
Between:
1. Sahara India Pariwar,
Rep. the Sector Worker
Sector Office, Narsannapeta
Village and Mandal, Srikakulam Dist.,
2. The Zonal Worker,
Sahara India Pariwar,
Sahara Manzil, Opp:Secretariat,
Hyderabad.
3.The Managing Director,
Sahara India Pariwar, Command Office,
Sahara India Bhavan, 1, Kapurthala Complex,
Lucknow. … Appellants/
Opposite parties
And
Shri Aravala Chinnavadu,
S/o.late Narasayya,
Aged 27 years, Occ:Cultivation,
R/o.Pusaralapadu Village,
Gara Mandal, Srikakulam Dist.,A.P. ..Respondent/
Complainant
Counsel for the Appellant: Smt.Vijaya Sagi
Counsel for the Respondent : Mr.A.Rama Rao
QUORUM: THE HON’BLE SRI JUSTICE D.APPA RAO, PRESIDENT
SMT.M.SHREESHA, MEMBER
AND
SRI G.BHOOPATHI REDDY, MEMBER.
TUESDAY, THE EIGHTH DAY OF JULY,
TWO THOUSAND EIGHT
Oral Order:(Per Smt.M.Shreesha, Hon’ble Member)
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Aggrieved by the order in C.D.No.116/2005 on the file of District Forum, Srikakulam, opposite parties preferred this appeal.
The brief facts as set out in the complaint are that the mother of the complainant during his life time deposited an amount of Rs.3,000/- on 20-11-1999 under Sahara 10 Option A scheme with opposite party No.1, The complainant was the nominee for recovery of the amount payable under the aforesaid death help benefit. The complainant submitted that his mother died on 31-3-2001 due to shock and cardiac respiratory arrest. The complainant intimated the death of his mother to the opposite parties and requested to pay the bond amount immediately and to arrange payment of death benefits due under Sahara 10 Option A scheme. The complainant submitted that opposite party No.1 after lapse of one year, asked the complainant to submit the birth certificate of the deceased and accordingly he submitted the same in October, 2002 issued by M.R.O., Gara. The complainant submitted that as per Sahara 10 Option A scheme, the period of tenure is ten years and the maximum limit of investment is Rs.10,000/- and the return at the end of tenure is equal to the face value of the bond and death help to the nominee is an amount equal to the face value of the bond payable every month for a period of 10 years i.e. 120 months. The complainant approached opposite party No.1 to pay the bond amount and also death help at the rate of Rs.3,000/- p.m for a period of 10 years. The complainant submitted that opposite party taking advantage of illiteracy of the of the complainant dragged on the matter for three years even though he submitted all the required documents. The complainant submitted that it is the legal and bounden duty of the opposite parties to repay the bond amount and also to settle death help claim, but they failed to do so. The complainant got issued a legal notice to opposite party No.1 on 7-2-2005 demanding to pay the bond amount but opposite party refused to received the notice. Hence the complaint for a direction to the opposite parties to pay a sum of Rs.3,000/- together with interest at 24% p.a. from 20-11-1999 till the date of realization, to pay death help at Rs.3,000/- p.m. for a period of 120 months commencing from 1-4-2001 together with interest at 24 percent p.a. and to pay Rs.25,000/- towards compensation, Rs.2,000/- towards litigation expenses.
Opposite party No.1 refused to receive notice and opposite parties 2 and 3 though received did not choose to contest the matter and hence they were set exparte.
Based on the evidence adduced i.e. Exs.A1 to A6 and the pleadings put forward, the District Forum allowed the complaint in part directing opposite parties to pay Rs.3,000/- with interest at 12 percent p.a. from 21-11-99 till the date of realization, to pay Rs.1,65,000/- towards death help to the nominee i.e. complainant for 55 months at the rate of Rs.3,000/- per month commencing from 1-4-2001 till 31-10-2005 and continue to pay the same rate till 31-2-2011 after taking a personal guarantee from the complainant undertaking to repay the said amount in equal monthly instalment without interest at the rate of Rs.1,500/- per month within a period of 20 years commencing from 1-5-2011 together with compensation of Rs.10,000/-, Rs.1,000/- litigation expenses and advocate fee of Rs.500/- within a period of two months from the date of dispatch of copy of the award.
Aggrieved by the said order, opposite parties preferred this appeal.
The learned counsel for the appellants submitted that the matter ought to have been referred to arbitration since there was a arbitration agreement between the parties. The learned counsel also contended that the main motive of the company in providing death help is that the dependent family members may be given help in the form of interest free loan and drew our attention to the following pre requisites for advance the death help facility.
a) The death of the Bond Holder occurs after 12 months (365) days from the date of purchasing the Bonds and before completion of tenure
b) The age of the deceased bond Holder was between 16-60 years at the time of death.
c) The deceased Bond Holder was not suffering from any chronic fatal disease within 3 years from the time of purchasing the bonds. The nominee of the deceased Bond Holder shall produce authentic, convincing documentary proof in this regard along with birth certificate and proof of death of the Bond Holder to the satisfaction of the company.
d) The death of the Bond Holder did not occur due to suicide, or death punishment by the court of law.
e) The death of the Bond Holder did not occur due to communal violence or war.
f) In case Bond Holder exercises his option for premature redemption the nominees of the Bond Holder shall cease to be entitled for the death help facility ab initio
Note: Death help will be given on maximum 1 type of option only.
She further contended that the respondent should produce a medical certificate that the bond holder was not suffering from any fatal disease within the last three years from the opening of the account/purchasing of the bond and also give an undertaking that the death did not occur due to suicide or death punishment by any court of law or due to communal violence and war. She further contended that the respondent is not entitled to the death help on the following grounds:
i) The complainant is not the only nominee or the nominee described in the master opening form.
ii) The complainant has not furnished the succession certificate of the deceased account holder
iii) The complainant has not submitted the claim form to the Appellants
iv) The complainant has not filed the documents as required under caluse (c) (d) and (e) of the term for grant of death help.
The learned counsel submitted that the District Forum failed to appreciate the fact that death help of the scheme is not ‘Dues’ or in the nature of insurance claim, it is a interest free loan advanced by the company upon fulfillment of certain criteria and upon furnishing a personal guarantee by the nominee.
The learned counsel for the respondent submitted that as per SAHARA 10 Option A Scheme, the maximum limit of investment is Rs.10,000/- and the respondent invested Rs.3,000/- on 20-11-1999 for which a bond was also issued and the respondent’s mother expired on 31-3-2001 due to cardiac arrest. The respondent had submitted all the required documents but the appellants did not adhere to the terms and conditions giving monthly death benefit of Rs.3,000/- for 120 months and there was also no reply to the legal notice dated 7-2-2005 and therefore the District Forum has rightly ordered payment of the face value of the bond and also the death benefits together with interest and compensation.
We have perused the material on record. The facts not in dispute are that the respondent’s mother had invested Rs.3,000/- towards bond amount on 20-11-1999. As per Ex.A3, the respondent’s mother died on 31-3-2001. It is the respondent’s case that as per the terms and conditions of the bond, he is entitled to the amount equivalent to the face value of the bond which should be payable for a period of 10 years i.e. 120 months and the amount shall be repaid by the respondent from the 121 month upto 240 month without interest. It is the case of the appellants that the matter ought to have been referred to an arbitrator. We rely on the judgement of the National Commission reported in II(2006) CPJ 259 (NC) in YASHPAL MARWAHA v. PUSHPA BUILDERS LTD., and ANR. wherein the National Commission while discussing the jurisdiction of the Consumer Fora held that:
Even if there are pending arbitration proceedings, it is not a bar for
entertaining a consumer complaint.
The National Commission in UDAIPUR CEMENT WORKS v. PUNJAB WATER SUPPLYand SEWAGE BOARD reported in I (1999) CPJ 67 (NC) also held that:
Mere existence of an arbitration clause does not oust the jurisdiction
of Consumer Forum.
We rely on the judgement of the Apex court in the case of FAIR AIR ENGINEERS PVT. LTD. AND ANOTHER v. N.K.MODI reported in II (1996) CPJ 13 (SC) wherein the Apex court held as follows:
Though the District Forum, State Commission and National Commission
are judicial authorities, for the purpose of Section 34 of the Arbitration
Act, in view of the object of the Act and by operation of Section 3 thereof,
we are of the considered view that it would be appropriate that these
forums created under the Act are at liberty to proceed with the matter
in accordance with the provisions of the Act rather than relegating the
parties to an arbitration proceedings pursuant to a contract entered into
between the parties. The reason is that the Act intends to relieve the
consumer of the cumbersome arbitration proceedings or civil action
unless the forums on their own and on the peculiar facts and circumstances
of a particular case, come to the conclusion that the appropriate forum for
adjudication of the disputes would be otherwise than those given in the
Act.”
Therefore, we are of the view that this Commission has jurisdiction to entertain the complaint. Section 3 of the Consumer Protection Act, 1986 states that ‘The provisions of this Act shall be in addition to and not in derogation of the provisions of any other law for the time being in force’. Keeping in view the aforementioned judgements and Section 3 of Consumer Protection Act, 1986, we are of the considered view that the ‘Consumer Forum’ and ‘State Commission’ have jurisdiction to entertain the complaint.
The second contention of the learned counsel for the appellants is that the nominee of the account holder did not give the required medical certificate showing that he was not suffering from any fatal or chronic disease within the last three years from the opening of the account and that he did not die due to suicide or death punishment by court of law or due to communal violence or war. It is the case of the respondent that the respondent’s mother died on 31-3-2001 due to cardiac arrest. A certificate of death, Ex.A3, has been issued by the M.R.O., We observe from the record that the appellants did not take any steps to take such a medical certificate from the respondent and there was not even any reply despite service of legal notice dated 7-2-2005. They also remained exparte before the District Forum. It is only at the appellate stage that they have come up with this plea that the respondent did not establish that it was a death falling under the terms and conditions of the said scheme.
The third important contention of the appellants is that the age proof of the deceased ought to be furnished and the same ought to be enquired by their company officials. We observe from the record that the birth certificate, issued by M.R.O., vide Ex.A4 dated 14-10-2002 has been submitted to the appellants. It is pertinent to note that even in the legal notice dated 7-2-2005, the respondent stated that all the required documents had been submitted to the agent yet the bond amount of Rs.3,000/- along with the monthly death benefits were not paid. There is no reply to this legal notice and there is no documentary evidence filed by the appellants to establish that the respondent has not submitted the claim form nor the date of birth as required as per the terms and conditions.
The learned counsel for the appellants submitted that the required documents were not executed by the nominee of the deceased i.e. respondent. We direct the appellants to furnish the necessary documents within a week from the date of receipt of this order to the nominee, who shall execute the said documents and on such execution, the appellants shall comply with the order of the District Forum. We observe that enquiry regarding the cause of death or any other enquiry relating to this aspect cannot be taken by the appellants at this belated stage and it is only for execution of these documents, two weeks time is being granted by this Commission from the date of receipt of order since death had taken place 7 years prior to this date.
The learned counsel for the appellants in her written arguments further contended that the District Forum erred in granting interest on the bond amount at 12 percent p.a. from the date of death till the date of realization and also compensation, which is against the norms of the scheme. It is pertinent to note that the legal notice is dated 7-2-2005 and till date the appellants did not make any attempt to settle the monthly death help benefit to the respondent. It is more than 7 years since the death of the respondent’s mother and making the respondent run from pillar to post during this inordinate period of 7 years justifies the compensation of Rs.10,000/- awarded by the District Forum. However, we are of the view that interest at 12 percent p.a. is excessive and the same is reduced to 9 percent p.a. while we confirm the other aspects of the order of the District Forum. Since the respondent had already withdrawn an amount of Rs.50,000/-, interest would be calculated accordingly i.e. interest at 9 percent p.a. would be calculated from 21-11-1999 till the date of deposit on Rs.50,000/- and this amount of Rs.50,000/- would be deducted and thereafter 9 percent p.a. would be calculated on the balance amount.
In the result the appeal is allowed in part modifying the order of the District Forum by reducing the interest granted from 12 percent p.a. to 9 percent p.a. while confirming the other aspects. Since the respondent had already withdrawn an amount of Rs.50,000/-, interest would be calculated accordingly i.e. interest at 9 percent p.a. would be calculated from 21-11-1999 till the date of deposit on Rs.50,000/- and this amount of Rs.50,000/- would be deducted and thereafter 9 percent p.a. would be calculated on the balance amount. Time for compliance two weeks.
PRESIDENT. LADY MEMBER. MALE MEMBER.
JM Dated 08-7-2008
