BEFORE THE DISTRICT CONSUMER DISPUTES

REDRESSAL COMMISSION, JALANDHAR.

Complaint No.322 of 2018

Date of Instt.10.08.2018

Date of Decision:09.03.2021

Prabhjot Singh S/o Harjinder Singh R/o Village Karari, Tehsil and District Jalandhar.

..........Complainant

Versus

1. SMC Insurance Brokers Pvt. Ltd. (Broker Code:013200) Corporate Address: Parsavnath Metro Mall, Near Metro Station Pratap Nagar, New Delhi, Delhi 110007.

(a) Registered Office Address: 11/6B, Shanti Chambers, Pusa Road, New Delhi-110005, through its authorized managing director/Vice Presidents operations.

2. Mohit Nahal, Assitant Sales Manager, Bharti Axa Life Insurance Co. Ltd Office Address: 2^nd Floor Eminent Mall, Guru Nanak Mission Chownk Jalandhar-144001.

3. Bharti Axa Life Insurance Co. Ltd, through its managing director Office Address: 2^nd Floor Eminent Mall, Guru Nanak Mission Chownk Jalandhar-144001.

….….. Opposite Parties

Complaint Under the Consumer Protection Act.

Before: Sh. Kuljit Singh (President)

Smt. Jyotsna (Member)

Present: Sh. B. S. Lucky, Adv. Counsel for the Complainant.

Sh. Varinder Singh, Adv. Counsel for the OP No.1.

Sh. K. S. Minhas, Adv. Counsel for the OPs No.2 & 3.

Order

Kuljit Singh(President)

1. The instant complaint has been filed by the complainant, wherein alleged that the OPs are inter connected with each other as they all are doing the business for Bharti Axa Life Insurance Co. Ltd and having their business premises at Jalandhar at the above said address. That the OPs No.1 & 2 introducing themselves as representatives of OP No.3 and they in a conspired manner in order to cause wrongful loss to the complainant and to incurred wrongful gain for themselves have made a false story and have received huge amount from the complainant. The complainant being the consumer availed the services of the OPs. The detail of which is as follows:

(i) The date of insurance policy is 14September 2017, policy No.501-6185927 of Rs.98,999.08/- in name of Prabhjot Singh Complainant.

The above policy is of Bharti AXA Life Insurance Co. Ltd. which is provided to the complainant under the false influence/allurement and misrepresentation of OPs No.1 & 2 and the complainant has deposited the above said sum amount vide Cheque No.019230 dated 07.09.2017 of Rs.99,000/- from Punjab Gramin Bank, Jalandhar Road, Kapurthalain favour of OP No.3 Bharti AXA Life Insurance Co. Ltd. That the OP No.1 in the month of August 2017 approached the complainant and apprised him about the different insurance plans of OPs. The complainant was un-willing to take the insurance policy for the reasons of limited financial resources and income and more so on the account of no need of the insurance policy because of limited income. That after few days the complainant received a call from Munish Tandon employee of OP No.1 who after getting the personal information from the complainant, procured/gained confidence of the complainant provide the information of his insurance company plans. OPs told the complainant that this is the one time investment plan and the complainant has to deposit only once the premium amount and after 5 years from the commencement of the policy the amount will get double amount. Thereafter OP No.1 send OP No.2 to the complainant to influence/allure more to take the insurance policy of their company as this is their best limited buyback plan till yet. That at the time of receiving the policy amount the above said OPs No.1 & 2 again told the complainant that he has to deposit only once the policy amount and will get double amount after five year of the commencement of the policy. At that time OP No.2 with the instructions of OP No.1 and 3 has got obtained the signatures of the complainant on so many blank documents and forms which are in English and complainant who are illiterate person and do not known the contents of those documents, signed by him in good faith being layman and ignorant about the consequence of the same at the instructions/influence of OPs and they have also assured the complainant at that time that the complainant shall surely get double of the deposit amount after five years as they also invested their own money in this plan also. That thereafter receiving the above said policy, after 3 months when the complainant have got a call from the Bharti AXA Life Insurance Co. Ltd. regarding the conformation and Tele-Verification of the policies delivery, at that time the caller told the complainant that the next policy premium should be paid on time to avoid the late fees charges. The complainant got stun/shocked after hearing this told him that they opted one time investment plan (Single Premium Plan) and thereafter the caller cut down his call. Then the complainant got checked this policy from his neighbourer/friend who has informed the complainant after reading the contents of that policy that complainant has to deposit more money/cash every year for 12 years and this was a surprise news for the complainant that OPs No.1 and 2 has provided false or wrong information to the complainant by misguiding or by false influence/allurement and have extorted huge amount from the complainant with an dishonest intension in order to cause wrongful loss to the complainant and at the same time for wrongful gain for themselves. Though complainant was not agreed to get that policy on terms and conditions mentioned in that policy so OPs No.1 and 2 has played fraud with the complainant which is not fare on their part. So as such complainant does not want to continue with the above said policy of their insurance company because the plan they have described to the complainant is fake one and on that account they have defrauded the complainant with dishonest and planned manner to cheat the complainant. The complainant has invested their life time valuable amount in these policies and now they are facing crises as their entire amount was swallowed by the OPs. That despite protracted representations, follow-ups, personal visits and telephonic enquiries the OPs have failed to cancel or refund the above said policies amount. The whole act and approach of the OPs is callous, remorseful and their negligence is unpardonable, deficiency is inexcusable and all of them are guilty of unfair trade practice and as such, necessity arose to file the present complaint with the prayer that the complaint of the complainant may be accepted and OPs be directed to refund the respective premium and made against the policy No.501-6185927 for Rs.98,999.08/- and further be directed to grant cost of the proceedings of the complaint reckoned to Rs.35,000/- against OPs to the complainant with interest @ 15% per annum from the date of the deposit of the premium till realization and further OPs be directed to pay litigation expenses of Rs.1,50,000/-.

2. Notice of the complaint was given to the OPs and accordingly, OP No.1 appeared through its counsel and filed written reply and contested the complaint by taking preliminary objections that the present complaint is gross misuse of the process of law and devoid of any merit as such there is no cause of action for the complainant against OP No.1 and it is merely an efforts to harass OP No.1 and to extract money with its malafide intention. That the OP No.1 has been falsely arrayed as the OP No.1 in the present complaint. That the complainant does not fall within the meaning and definition of “consumer” as defined in Section 2 (1) (d) of the Consumer Protection Act, 1986 for the reasons that the complainant entered into the disputed transactions. The complaint is bad for mis-joinder of parties, as there is no cause of action arose against the OP No.1 as there is no privity of contract between the complainant and the OP No.1 and is ought to be deleted from the array of parties as it is not maintainable against the answering OP No.1. That the present complaint filed by the complainant is an absolute derogation of the established principles of law. It is also pertinent to mention here that apart from the above mentioned standard verification procedures, for the purpose of ensuring that complainants understand their rights and obligations under each and every policy, the complainant was made to sign a one page Client Declaration Form in which the main terms and conditions of the policy were clearly mentioned: (a). Premium paying term under the policy, (b). Main benefits under the policy. (c) Declaration of the complainants that they understand that the premium has to be paid every year. (d) Declaration of the complainants to the effect that they understand that the present policy in not linked to any other insurance plan. The other allegations as made in the complaint are categorically denied and lastly submitted that the complaint of the complainant is without merits, the same may be dismissed.

3. The OPs No.2 & 3 filed its separate written reply and contested the complaint by taking preliminary objections that the present complaint is false, frivolous, vexatious and abuse of the process of this Forum and therefore the same is liable to be dismissed. The complainant has not disclosed any cause of action to proceed against the OPs and in absence of the same the present complaint is liable to be dismissed. It is further submitted that on the basis of the proposal form, the subject policy was issued to the complainant. Thus, the allegations herein are false, frivolous and untenable and a concocted story. It is submitted that the applicant has not obtained the policy through any of agents/employees of answering respondents. For obtaining the policy in question, the policy holder had availed the services of an independent broker i.e. SMC Insurance Broker. An Insurance Broker is an independent entity licensed by Insurance Regulatory & Development Authority (IRDA), who advise their customers on their insurance needs and thereafter arrange insurance policy from any insurance company as per their own judgment and as per the customer’s choice. It is to be noted that the insurance companies do not enjoy any administrative control over the insurance brokers. All insurance brokers are governed by the provisions of IRDA Regulations, 2002 and IRDA also entertain applications against insurance brokers. It is a settled principle of law that at the time of filling-up the proposal form, the agents acts as agent of insured and not of insurance company. No agent can be assumed to have authority from the insurer to write the answer in the proposal form. If an agent nevertheless does that, he becomes merely the amanuensis of the insured and his knowledge of the untruth or inaccuracy of any statement contained in the proposal form does not become the knowledge of the insurer. It is further alleged that this Forum has no jurisdiction to entertain the present complaint. There was no deficiency in service or negligence on the part of the replying OP and further alleged that the complainant has failed to demonstrate any deficiency in service on the part of the replying OPs. It is further submitted that the OP company after the receipt of the proposal form, benefit illustration and supporting documents life age proof, address proof etc issued the policy to the complainant. The other allegations as made in the complaint are categorically denied and lastly submitted that the complaint of the complainant is without merits, the same may be dismissed.

4. In order to prove the case of the complainant, the counsel for the complainant tendered into evidence affidavit Ex.CA alongwith some documents Ex.P-1 to Ex.P-5 and closed the evidence.

5. In order to rebut the evidence of the complainant, the counsel for the OP No.1 tendered into evidence documents Ex.OP1/1 to Ex.OP1/3 and closed the evidence and further, the counsel for the OPs No.2 & 3 tendered into evidence affidavit Ex.OP2&3/A alongwith some documents Ex.R-1 to Ex.R-4 and closed the evidence.

6. We have heard the argument of learned counsel for the respective parties and have gone through the case filevery minutely.

7. Learned counsel for the complainant argued that complainant opted to purchase single premium policy in the sum of Rs.98,999.08 on the assurance of OPs that the money of the complainant would be doubled in five years but when complainant contacted the OPs after five years to refund his money the officials of OPs asked him to contact them after a month for the payment of the same and thereafter he visited the office of OPs many times and send legal notice to the OPs but the OPs flatly refused to admit her lawful claim.

8. On the other hand, Learned counsel for the Ops argued that policy in question was issued to complainant after the receipt of the proposal form duly signed by him and further argued that the complainant opted himself a policy for a term of 12 years by paying an annual premium of Rs.98999.10/- per annum.

9. We are of the considered opinion that on the basis of proposal form and the declaration made thereunder, the OPs issued an insurance policy with the commencement date of 14.09.2017.   On perusal of Ex.R-1 proposal form, we find that proposal form and declaration is signed by the complainant.  Ex.R-3 is the policy wherein it is clearly mentioned that your policy requires “Regular Premiums to be paid for 12 years” and further it is mentioned that 15/30 days were given under the policy in question for free look cancellation and any application for free look cancellation made after the lapse of 15/30 days shall not be entertained. Ex.R-3 is also including the standard terms and conditions of the policy in question.  Meaning thereby that complainant was well aware about the fact that the policy was issued for a term of 12 years and not a single premium policy as alleged. Further, the complainant has not denied the signatures on proposal form. By simply alleging that he deposited the said amount in single premium policy and would get doubled amount at the end of five years will not serve the desired purpose.  The documents of the OPs are unchallenged and un-shattered. 

10. Further, counsel for the complainant argued that complainant wrote many letters/complaints to the OPs to refund his money but the OPs did not pay any heed to his request. We have seen the document Ex.P-3 and Ex.P-3A to this effect. It is submitted by the OPs in written statement that as per IRDA Regulation 2002, the policy terms and conditions specifically provides for a free look period of 15 days, during which period the policyholder is entitled to review the policy terms and conditions and request for a cancellation, if dissatisfied with the same.  We find that the complainant never raised any question regarding the said policy within that period. Thus the complainant cannot wriggle out of the valid contract between him and the OPs. So, the claim for the refund of the amount deposited by the complainant under the terms of the policy is unsustainable in the eyes of law.  Hence, the complainant is entitled for surrender value only.

11. However, the complainant is held entitled to surrender value as per IRDA Regulations 2013 which came into force on 18.02.2013.  Wherein, Regulation 13, obligation of an insurer upon discontinuance of a policy before lock-in-period- finds mentioned as under:-

 AP- Annualized premium

FV-Fund value

Provided that where a policy is discontinued, only discontinuance charge and Fund management charge, which shall not exceed 50 bps per annum on discontinuance fund/policy account value, as applicable,  may be levied by the insurer and no other charges by whatsoever shall be levied.

Provided that no discontinuance charges shall be imposed on top ups premiums.”

12. The complainant deposited Rs.98.999.08 as one premium of the policy.  Complainant failed to deposit the regular premium afterwards, hence discontinuance of the policy occurred in the third policy year.  According to the regulation, extracted above, the Ops should pay the complainant, after deducting Rs.4,000/- only from the total deposited amount by the complainant and as such he is entitled to get Rs.94,999/-.  Thus, the Ops are liable to pay the complainant, a sum of Rs.94,999/-.   

13. Therefore, as discussed above, the present complaint is partly allowed and the OPs are directed to pay Rs.94,999/- to the complainant. Further, OPs are directed to pay compensation and litigation expenses for mental harassment to the tune of Rs.5000/-. The above said entire compliance be made by the OPs within a period of 45 days from the date of receipt of copy of this order.

14. Copy of this order be supplied to the parties free of costs. The file be consigned to the records after its due compliance.

ANNOUNCED IN THE OPEN FORUM:

9^th Day of March, 2021

(Kuljit Singh)

President

(Jyotsna)

Member