Chandigarh

DF-I

CC/785/2022

RAM BALAK PODDAR - Complainant(s)

Versus

TATA CAPITAL HOUSING FINANCE LIMITED & ANR - Opp.Party(s)

DEVINDER KUMAR

02 Apr 2024

ORDER

DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION-I,

U.T. CHANDIGARH

                                     

Consumer Complaint No.	:	CC/785/2022
Date of Institution	:	02/09/2022
Date of Decision	:	02/04/2024

 

1.     Ram Balak Poddar son of Sh Phool Chand

2.     Kiran Devi wife of Sh. Ram Bala

3.     Ajay Poddar son of Sh. Ram Balak Poddar

4.     Nishu Poddar wife of Sh. Ajay Poddar

        All residents of House No.304, Sector 17, Panchkula, Haryana.

… Complainants

V E R S U S

1.     Tata Capital Housing Finance Limited, SCO No.20, 2^nd Floor, Sector 26, Chandigarh through its Branch Manager.

2.     Tata AIA Life Insurance Company Limited, SCO No.2939-2940, Sector 22, Chandigarh through its Branch Manager.

… Opposite Parties

 

CORAM :	SHRI PAWANJIT SINGH	PRESIDENT
	MRS. SURJEET KAUR	MEMBER
	SHRI SURESH KUMAR SARDANA	MEMBER

 

                                                                               

ARGUED BY	:	Sh. Devinder Kumar, Advocate for complainants
	:	Sh. Shrey Goel, Advocate for OP-1
	:	Ms. Monika Thatai, Advocate for OP-2.

 

Per Pawanjit Singh, President

1. The present consumer complaint has been filed by Ram Balak Poddar and others, complainants against the aforesaid opposite parties (hereinafter referred to as the OPs).  The brief facts of the case are as under :-

1. It transpires from the allegations, as projected in the consumer complaint, that complainant No.2 is proprietor of M/s Hot Set India and running the said firm with her family members. In the month of December 2021, officials of OP-1 approached the complainants and allured them to obtain loan facility.  The OPs also assured the complainants to provide best and prompt services.  Believing the version of the officials of OP-1, complainants agreed to avail loan facility from the OPs and submitted all the required documents for the sanction of loan by completing all other formalities. OP-1 issued sanction letter dated 30.12.2021 for the home loan with total sanctioned amount of ₹2,99,00,000/- and the tenor of the loan was 240 months.  In order to secure the home amount of ₹2,86,00,000/-, OP-1 also sanctioned loan to the tune of ₹8,04,539/- for the purchase of insurance policy vide letter dated 31.12.2021 (Annexure C-2) under “Special Purpose Loans for Insurance Sanction Letter/Loan Term Sheet”. In this manner, OP-1 paid insurance premium of ₹8,04,539/- to OP-2 and OP-2 intimated complainants vide letter dated 11.1.2022 (Annexure C-3), but, without disclosing the particulars of the insurance policy and supplying copy of the policy to the complainants.  For the purpose of security and to fulfil the requirement of the OPs, complainants also mortgaged their property with the OPs.  After disbursement of the loan, complainants paid monthly installments to OP-1 and there was no default on the part of the complainants. Thereafter complainant No.3 contacted OP-1 through its official with the request to reduce the rate of interest as the other banks were providing loan facility on lower rate of interest and when it did not accede to the request of the complainants, the complainants decided to close their loan account. Accordingly, complainants approached HDFC Bank, Sector 8, Chandigarh where it was found that the said bank was providing loan facility at lower rate of interest. Thereafter the complainants requested OP-1 to close the loan account of complainants vide letter dated 29.4.2022 (Annexure C-4) and when the said OP did not care to close the account, another letter (Annexure C-5) was sent by the complainants to OP-1 and finally OP-1 closed the account and issued letter dated 4.7.2022 (Annexure C-6) to the complainants.  After closure of account, complainants requested OP-1 to refund the entire premium amount to them, but, instead of refunding insurance premium to the complainants, OP-1 intimated vide letter (Annexure C-7) that refund would be processed according to surrender value.  On receipt of the foresaid letter when nothing was done by OP-1, complainants again submitted another letter dated 28.7.2022 (Annexure C-8) with the request to resolve the issue.  However, OP-2 without any prior intimation or consent of the complainants transferred an amount of ₹3,21,867.75 on 30.7.2022 instead of total received amount of ₹8,04,539/- and thereby deducted an amount of ₹4,82,672/-  without assigning any reason and the copy of statement of account is Annexure C-9.  Thereafter, complainants approached the OPs to refund the entire premium amount, but, with no success. In this manner, the aforesaid act of the OPs amounts to deficiency in service and unfair trade practice. OPs were requested several times to admit the claim, but, with no result.  Hence, the present consumer complaint.
2. OPs resisted the consumer complaint and filed their separate written versions.
3. OP-1 in its written version, inter alia, took preliminary objections of maintainability, cause of action, concealment of facts and also that there is no deficiency in service on the part of the answering OP.  However, it is admitted that the subject loan to the tune of ₹2,99,00,000/- was sanctioned in favour of the complainants and on further request of the complainants another loan of ₹8,04,539/- was sanctioned for the purchase of insurance policy from OP-2 for securing the loan.  It is denied that the second loan was not sanctioned on the request of the complainants and they were not knowing about the same. On merits, the facts as stated in the preliminary objections have been reiterated. The cause of action set up by the complainants is denied.  The consumer complaint is sought to be contested.
4. OP-2 in its written version, inter alia, took preliminary objections of maintainability, cause of action, concealment of facts and also that there is no deficiency in service on the part of the answering OP.  However, it is alleged that the housing loan to the tune of ₹2,86,00,000/- was insured by the answering OP and the same was closed by the answering OP on the request of the complainants.  It is further alleged that, in fact, the premium amount was also paid by the complainants by obtaining loan from OP-1 and the complainants have approached for the refund of the premium amount.  It is further alleged that the answering OP has already refunded the premium amount to the tune of ₹3,21,867.75 to the complainants in terms of the surrender benefit as per the terms and conditions of the subject policy.  On merits, the facts as stated in the preliminary objections have been reiterated. The cause of action set up by the complainants is denied.  The consumer complaint is sought to be contested.
5. In replication to the written version of OP-2, complainants re-asserted the claim put forth in the consumer complaint and prayer has been made that the consumer complaint be allowed as prayed for.  However, the complainants chose not to file replication to the written version of OP-1.

2. In order to prove their case, parties have tendered/proved their evidence by way of respective affidavits and supporting documents.
3. We have heard the learned counsel for the parties and also gone through the file carefully, including written arguments.
   1. At the very outset, it may be observed that when it is an admitted case of the parties that the complainants had obtained home loan amount to the tune of ₹2,99,00,000/- from OP-1, as is also evident from the sanction letter (Annexure C-1) and in order to secure the home loan amount of ₹2,86,00,000/- the same was got insured by the complainants from OPs 1 & 2 on payment of single premium of ₹8,04,539/-including taxes, cesses, levies to the tune of ₹1,22,393.70 by also obtaining loan from OP-1, as is also evident from the sanction letter (Annexure C-2) and the complainants closed their loan account with OP-1 on making one time payment, as is also evident from letter dated 4.7.2022 (Annexure C-6) and on receiving intimation from OP-1, OP-2 has refunded an amount of ₹3,21,867.75 being surrender value, the case is reduced to a narrow compass as it is to be determined if OP-2 is unjustified in not refunding the entire one time premium amount paid by the complainants to OP-2 to the tune of ₹8,04,539/- and the complainants are entitled to the remaining premium amount as is the case of the complainants or if OP-2 has rightly refunded the amount after calculation of the surrender value, as per the terms and conditions of the subject policy and the consumer complaint of the complainants is liable to be dismissed, as is the defence of OP-2.
   2. As it is an admitted case of the parties that the home loan of ₹2,86,00,000/- was secured by the complainants by obtaining subject policy on payment of one time premium of ₹8,04,539/- by obtaining loan from OP-1 and OP-1 had closed the loan account in the month of July 2022 i.e. within six months of the issuance of the subject policy, the documentary evidence led by the parties, in order to prove these facts, is not required to be discussed since the moot question, which is required for determination by this Commission, is if the complainants are entitled for the refund of the entire premium amount on the closure of the loan account in the month of July 2022 by the complainants or if OP-2 is liable to refund the surrender value of the premium as per terms & conditions of the subject policy.
   3. Perusal of Annexure OP-2/4 clearly indicates that the subject policy was issued to the complainants on 7.1.2022 upon receipt of total premium amount of ₹8,02,358.70. The terms & conditions of the subject policy (annexed with Annexure OP-2/4 at page 27) further provide the calculation to be made for calculating the surrender benefit in case the insured member surrenders the insurance cover and repays the outstanding amount in full and submits the surrender request.  The relevant portion/clause of the subject policy is reproduced below for ready reference :-

       “SURRENDER BENEFIT

The Insured Member also has the right to surrender the Insurance Cover, only if the member repays the outstanding loan amount in full and submits a surrender request with the Company. In case of limited premium option, the surrender benefit will be available provided at least two full year's premiums have been paid. There is no surrender value available in the regular premium option. On surrender of the coverage Insured Member will be entitled for a surrender value. Amount of Surrender value will be calculated by using below formula under Level Sum Assured or Reducing Sum Assured benefit option:

Surrender value = (50% of the premium paid less applicable taxes levies and cesses) multiplied by (unexpired policy term divided by total Policy Term) multiplied by (Coverage at the time of surrender divided by Sum Assured at inception).

 

4. In the case in hand, the total premium of ₹8,02,378/- was paid by the complainants and after excluding the taxes etc. to the tune of ₹1,22,393.70, the total premium amount paid to OP-2 comes to ₹6,79,965/-, as is also evident from Annexure OP-2/4 and 50% the same comes to ₹3,39,982.50.  The total policy term was 156 months and the unexpired term is 149 months. Similarly, the coverage at the time of surrender was ₹1,41,59,203.74 whereas the sum assured at the time of inception of the subject policy was ₹1,43,00,000/-. In this manner, OP-1 was required to calculate the surrender value in the following manner :-

Surrender value = (50% of the premium paid less applicable taxes levies and cesses)	=	₹3,39,982.50
₹3,39,982.50 * 0.955 * 0.990	=	₹3,21,436.45

 

5. In the case in hand, as OP-1 has already refunded an amount of ₹3,21,867.75 to the complainants i.e. the surrender value, it is safe to hold that OP-1 has already refunded more than the amount due to the complainants and, therefore, there is no deficiency in service or unfair trade practice on the part of OPs.
6. The learned counsel for the complainants contended with vehemence that as the terms and conditions of the subject policy were not supplied to the complainants, they were not aware of the deduction by way of surrender value and the aforesaid act of OP-2 amounts to unfair trade practice.  However, there is no force in the contention of the learned counsel as the complainants have not disputed the fact that they were not aware about the subject policy since they are only disputing the terms & conditions of the subject policy, which is otherwise clear from Annexure OP-2/4 that the complainants were given 15 days as free look option/period from the receipt of policy/certificate of insurance to review the terms and conditions and also that the complainants themselves have signed the member enrollment form (Annexure OP-2/2), which is duly signed by the complainants, hence it does not lie in the mouth of the complainants to say that they were not even aware of the terms and conditions of the subject policy.

4. In the light of the aforesaid discussion, the present consumer complaint, being devoid of any merit, is hereby dismissed leaving the parties to bear their own costs.
5. Pending miscellaneous application(s), if any, also stands disposed of accordingly.
6. Certified copies of this order be sent to the parties free of charge. The file be consigned.

02/04/2024 hg	Sd/- [Pawanjit Singh] President
	Sd/- [Surjeet Kaur] Member
	Sd/- [Suresh Kumar Sardana] Member