Heard learned counsel for the appellants. None appears for respondent.

2.     This appeal is filed u/s 15 of the Consumer Protection Act (hereinafter called the ‘Act’ in short). Parties hereinafter were arrayed as the complainant and OPs as per their nomenclature before the learned District Forum.

3.     Learned counsel for the appellants submitted that the learned District Forum has acted illegally by not going through the Regulation 8(4) of the LIC (Agent) Regulations Act, 1972 and LIC (Agent) Regulation Act, 2017 (revised)  which  states that agent has no authority of LIC to collect  any money or risk  on behalf of LIC or bind LIC whatsoever. Also decision of the Hon’ble Supreme Court passed in Harshad J.Shah and another vrs. LIC of India and others reported in AIR 1997 SC 2459 also decided case support such Regulation. According to him the agent (OP No.3)  of the LIC has allegedly collected the premium from the insured but did not deposit the same failing which the complainant has suffered and as such made complaint alleging about deficiency in service against the LIC of India. But OP took pleas in their written version that complainant has not deposited premium towards renewal of his policy on his own risk but depend on LIC agent who later was  charged misappropriation  of fund.

4.     Learned counsel for the appellants further submitted that the learned District Forum without understanding the facts and law has passed order directing the OPs to pay compensation of Rs.10,000/- towards mental harassment and litigation expenses and Rs.5,000/- to the complainant within 30 days  of receipt of the order. The District Forum ought to have considered that the LIC is not responsible for any act or omission on the part of the agent as per Regulation 8(4) of the LIC (Agent) Regulations, 1972  and in order to avoid the provisions of Contract Act such provisions have been made. He also brought to our notice the relevant provisions, Regulation 8(4) of LIC (Agent) Regulations and the decision cited above. So, he submitted to set aside the impugned order by allowing the appeal.

5.     Considered the submission of learned counsel for the appellants and perused the impugned order along with the DFR. The operative portion of the impugned order is as follows:-

“xxx     xxx     xxx

For the reasons aforesaid and under the facts and circumstances we hold that, the complaint petition merits consideration and accordingly it is allowed on contest against the Ops by directing Op No.3 agent of the insurance company to return the premium amount collected from the complainant  for the period from the year 2007 to 2016 with interest @9% per annum. Further due to negligence of LIC Op No.1 & 2 due to  their deficiency of service as proved against them, they are liable to payment of compensation of Rs.10,000/- (Rupees ten thousand) towards mental harassment and litigation expenses of Rs.5,000/- (Rupees five thousand) to the complainants. The Ops are further directed to repayment of the aforesaid decreed amount within 30 (thirty) days of receiving this order failing which the same amount will carry interest @9% per annum as penal interest till payment.”

6.     From the aforesaid impugned order, it is found that the learned District Forum has not analysed the Regulation 8(4) of LIC (Agent) Regulations but straight came to the conclusion that due to act of OP No.3 who is working as an agent of the appellants has got deficiency of service and unfair trade practice on the part of OP No.3 and as such the LIC the principal is responsible. Had they followed the decision and the Regulation, perhaps they would have reached the correct conclusion.

7.     Regulation 8(4) of LIC (Agent) Regulations is as follows:-

“Nothing contained in these regulations shall be deemed to confer any authority on an agent to collect any money or to accept any risk for or on behalf of the Corporation or to bind the Corporation in any manner whatsoever:”

8.     Such provision has also been analysed in the decision of Harshad J.Shah (Supra) where Their Lordships have observed as follows:-

“ Nor can it be said that  respondent No.3 had an implied authority to collect the premium on behalf of the LIC became in 1972 the LIC has made a regulation (Regulation 8(4), which in 1981 became a rule, prohibiting the agents from collecting premium on behalf of the LIC. It cannot be said that the LIC induced the insured to believe that respondent No.3 had been authorised by the LIC to receive premium on behalf of the LIC. We are, therefore, unable to hold that the doctrine of apparent authority underlying Section 237 of the Indian Contract Act can be invoked in the facts of this case especially when the LIC has been careful in making an express provision in the Regulations/Rules, which are statutory in nature, indicating that the agents are not authorised to collect any moneys or accept any risk on behalf of the LIC and they collect so only if they are expressly authorised to do so.

In disclaiming its liability the LIC is acting in accordance with the provision in Regulations/Rules famed by it whereby the agents have been prohibited from collecting the moneys on behalf of the LIC. The said provision has been made in public interest in order to protect the Corporation from any fraud on the part of an agent.”

9.     With due regard to the aforesaid decision and Regulation 8(4) of LIC (Agent) Regulations, OP No. 1 & 2 before the District Forum and the appellants  here cannot be held responsible. Hence, the impugned order is liable to be set aside and we do so.

10.   In the result, the appeal stands allowed. No cost.

        DFR be sent back forthwith.

        Statutory amount deposited be refunded to the appellants with interest accrued thereon, if any on proper identification.

         Supply free copy of this order to the respective parties or the copy of this order be downloaded from Confonet or Website of this Commission to treat same as copy supplied from this Commission.