This complaint is coming on for final hearing before us in the presence of Sri M.V.N.Malleswara Rao, Advocate for the complainant and                                  Smt. Y.Kameswari, Advocate for opposite party No.1, Memo filed against O.P.2 as not pressed hence dismissed and having stood over for consideration, the Forum made the following:-

O   R   D   E   R

          This is a complaint filed under Section 12 of Consumer Protection Act seeking the relief to direct the 1^st O.P. to pay the maturity amount of Rs.56,325/- with subsequent interest at 24% p.a., and to pay damages and costs to the complainant on the following averments.  The 1^st complainant is the life assured and 2^nd complainant is the life proposer who took Jeevan Kishore Policy from the 1^st O.P. through 2^nd O.P. on 28-3-1995 for an assured sum of Rs.30,000/- and the term of policy is for 17 years and the premium amount payable was Rs.1,744/- p.a.,  The 2^nd complainant applied for a loan of Rs.40,000/- in the month of May, 2010 for the educational purpose of 1^st complainant by pledging the policy bond with the 1^st O.P.   After scrutinizing the papers the 1^st O.P. sanctioned loan and gave a crossed cheque for Rs.39,422/- by deducting the balance amount of previous loan amount.  On 25-11-2011 the 2^nd complainant paid Rs.42,697/- towards part payment of loan amount and obtained a receipt to that effect.  On 28-3-2012 the policy was matured upon which the 2^nd O.P. approached the 2^nd complainant and gave status report showing that a sum of Rs.56,235/- is payable to the life assured after deducting the existing loan amount of Rs.3,000/- and interest amount of Rs.135/- and asked the complainants to come to the office of 1^st O.P. for receiving the maturity amount.  Since the 1^st complainant attained majority has approached the 1^st O.P. and requested to pay the maturity amount but of no avail.  The complainants got issued a notice dt.21-2-2013 to the O.Ps. calling upon them to pay the amount due but to no effect.  Hence the complaint.

          The 1^st O.P. filed counter traversing the material allegations made in the complaint and has averred that the 1^st complainant applied for a loan of Rs.40,000/- in the month of May, 2010 and the 1^st O.P. sanctioned the loan without recovering the earlier loan amount of Rs.14,500/- which was sanctioned to the 2^nd complainant on 3-4-2003.  It is averred that as per procedure to sanction a loan the outstanding previous loan amount with interest is to be deducted from the amount sanctioned as a loan.  The loan amount raised by the 2^nd complainant on the policy documents of her Son and Daughter were not recovered from the subsequent loan amounts granted to the life assured.  It is averred that the policy issued in the name of vineel the son of 1^st complainant was matured on 28-3-2010 and the LIC of India, Branch Office, Vizianagaram settled the claim for Rs.45,390/- without deducting the loan granted on 3-4-2003 to the 2^nd complainant.  When the policy issued in the name of 1^st complainant was matured on 28-3-2012 and the claim was settled for Rs.59,460/- they have observed that an amount of Rs.4.664/- relating to the previous loans was still due.  Since it is averred that the complainant did not approach the Forum with clean hands and there is no deficiency of service on the part of O.Ps. the complaint merits no consideration and is liable to be dismissed.

          In support of complainant’s case the affidavit evidence of P.W.1 is filed and they got marked Ex.A.1 to A.7 and on behalf of O.Ps. the affidavit evidence of R.W.1 is filed and Ex.B.1 to B.17 are marked.  Perused the material placed on record and heard the counsel for respective parties. 

          Now the point for consideration is whether the complainant’s are entitled to get the reliefs prayed for.

          The learned counsel for complainant has contented that the 1^st complainant being the life assured and 2^nd complainant being the life proposer have taken Jeevan Kishore Policy for Rs.30,000/- and after the policy was matured the 1^st complainant being the life assured made a request to the O.Ps. to settle her claim and as the latter did not pay any heed to her request the former had to file the complaint.  As against the above said contention the learned counsel for O.Ps. has contended that the 2^nd complainant being the mother and proposer of 1^st complainant and her brother, has availed loans by pledging the policy bonds and as she did not clear the loan amounts availed on               3-4-2003 completely the claim of 1^st complainant could not be settled and as the complainants did not come to court with clean hands the complaint filed by them is liable to be dismissed.

          In the evidence affidavit of P.W.1 she has fully reiterated the allegations made in the complaint and to support her oral testimony, they got marked the SSC Certificate of 1^st complainant as Ex.A.1 to show that the 1^st complainant has attained majority by the time the policy was matured.  They filed the Xerox copy of loan sanction letter given to the complainants, original receipt evidencing the repayment of loan amount and interest, status report evidencing maturity of policy, office copy of lawyer’s notice and two postal acknowledgments as Ex.A.2 to Ex.A.7 respectively.

          In the counter and affidavit evidence of R.W.1 the O.Ps. did not deny the issuance of Insurance policy in the name of 1^st complainant and availing of loans by the complainants  by pledging the policy documents with the 1^st O.P. and about maturity of policy etc.  The documents filed on behalf of O.Ps. also clearly reveals that 2^nd complainant being life proposer took Jeevan Kishore Policy on 28-3-1995 from the 1^st O.P. for a sum of Rs.30,000/- and on the said policy the 2^nd plaintiff being the life proposer availed loans.   After the policy was matured Ex.B.17 was emanated from the office of 1^st O.P. to show that a total sum of Rs.59,460/- was payable to the 1^st complainant towards maturity amount.  In the counter the 1^st O.P. has taken inconsistent pleas.  In para 3 it is averred that they are not aware that the 2^nd complainant has applied for a loan of Rs.40,000/- in May, 2010 for the education of 1^st complainant but  in Para 4 it is averred that 1^st complainant,  has applied for loan of Rs.40,000/- in the month of May, 2010 and the 1^st O.P. has sanctioned the loan without recovering the loan amount of Rs.14,500/- which was sanctioned to 2^nd complainant on 3-4-2003.  In para No.5 it is averred that as per procedure while sanctioning a loan the outstanding amount of previous loan if any is to be deducted together with interest from the current loan amount and balance would be paid to the loanee/policy holder.  If the above said contention is true and correct the 1^st O.P. must have deducted the outstanding loan amount pertaining to the loan granted on 3-4-2003 from out of the loan amount of Rs.40,000/- granted to the 1^st complainant in the month of May, 2010.  In para 9 and 10 of the counter it is averred that at the time of settlement of claim of the 1^st complainant they have observed that after deducting the 1^st loan amount which was availed on both policy documents an amount of Rs.4664/- was found to be due to the LIC.  The above said contentions made in paras 9 and 10 is contrary to the contentions made in Para 5 of their counter. 

          In para 8 of the counter it is averred that the policy obtained in the name of Vineel son of 2^nd complainant was matured on 28-3-2010 and the Branch office, Vizianagaram settled and paid the maturity amount of Rs.45,390/- without deducting the 1^st loan amount granted to the mother of Vineel the amount was paid.  If really the 1^st O.P. is true in their contention that the loan amount of Rs.14,500/- availed by the 2^nd complainant was due as on the date when the policy taken on the name of Vineel was matured the said amount would have been deducted from the maturity amount and officials would have paid the balance amount to Vineel.  Since, there is inconsistency with regard to outstanding of earlier loan amount and as the 1^st O.P. did not deduct the said     amounts from the subsequent loan amounts granted to the 1^st complainant and her brother it cannot be said that there was a due amount of Rs.4,664/- when the 1^st complainant made a request to settle her claim.

          Ex.A.2 is the copy of loan sanction letter given to the complainants. The O.Ps. did not dispute about its genuineness.   As seen from its contents, the 1^st O.P. after receiving loan papers from the 1^st complainant has settled the loan and sent a cheque for Rs.39,422/- drawn in favour of 1^st complainant.  The above said letter is of the year 2010 and the 1^st O.P. after perusing the documents and verifying about the existence of loans availed on the policy document seems to have sanctioned a fresh loan.  If really the loan amount availed by 2^nd complainant in the year 2003 was due on the policy document of 1^st complainant, the 1^st O.P. would have deducted the said amount and would have paid the balance amount to the complainants but they did not do so.  Ex.B.17 is the status report of policy of the 1^st complainant and as seen from its contents the previous loans were repaid and the maturity amount payable to her was determined to be Rs.59,460/-  The contents of the above said documents lends support to the case of complainants to believe that the loans availed by the complainants were totally discharged and the 1^st O.P. has settled the claim for Rs.59,460/- to be payable to the 1^st complainant towards maturity amount.  Hence, in the above said facts and circumstances we are of the considered opinion that 1^st complainant is entitled to get the above said maturity amount with interest.

          In the result, this complaint is allowed and the 1^st O.P. is directed to pay Rs.56,325/- (Rupees fifty six thousand, three hundred and twenty five only) with subsequent interest at 9% p.a., from the date of maturity of her policy till the date of payment.  The O.Ps. are further directed to pay a sum of Rs.2,000/- (Rupees two thousand only) towards costs and damages which include advocate fee of Rs.500/- (Rupees five hundred only).  The 1^st O.P. is directed to comply the order within 2 months from this day.

Dictated to the Typist, transcribed by her, corrected by me and pronounced by us in the open Forum, this the 5^th day of March, 2014.

Member                                                           President

CC. 44 of 2013

APPENDIX OF EVIDENCE

                                       WITNESSES EXAMINED

     For P.W.1                                                                  For R.W.1                                         

DOCUMENTS MARKED.

For complainant:-

1. Ex.A.1 xerox copy of SSC Certificate
2. Ex.A.2 Xerox copy of loan sanctioning letter May 2010
3. Ex.A.3 Original receipt of loan repayment dt.25-11-2011
4. Ex.A.4 Status report dt.28-3-2012
5. Ex.A.5 Office copy of lawyer notice dt.21-2-2013
6. Ex.A.6 Acknowledgement dt.27-2-2013
7. Ex.A.7 Acknowledgement dt.26-2-2013

For O.P: -

1. Ex.B.1 Jeevan Kishore Policy dt.28-3-1995 (Xerox copy)
2. Ex.B.2 Jeevan Kishore Policy dt.28-3-1995 (Xerox copy)
3. Ex.B.3 LIC Application for policy Loan dt.3-4-2003 (Xerox copy)
4. Ex.B.4 LIC form dt.3-4-2003 (Xerox copy)
5. Ex.B.5 Voucher dt.3-4-2003 (Xerox copy)
6. Ex.B.6 Voucher dt. 3-4-2003 (Xerox copy)
7. Ex.B.7 Transfer all rights, title and interest in policy (Xerox copy)
8. Ex.B.8 Application for policy loan dt.29-7-2004 (Xerox copy)
9. Ex.B.9 Letter dt.29-7-2004 (Xerox copy)

10.Ex.B.10 Application and Form of receipt dt.13-8-2008 (Xerox copy)

     11. Ex.B.11 letter dt.14-8-2008 (Xerox copy)

     12.  Ex.B.12 letter dt.1-5-2010 (Xerox copy)

     13. Ex.B.13 letter dt.27-3-2010 (Xerox copy)

     14. Ex.B.14 History of Loan transaction details (Xerox copy) dt.15-12-2013

     15. Ex.B.15  Loan transaction details dt.15-12-2013 (Xerox copy)

     16. Ex.B.16  Status Report dt.15-12-2013 (Xerox copy)

     17. Ex.B.17 Status Report dt.15-12-2013 (Xerox copy)

                                                                                                President