DISTRICT CONSUMER DISPUTES REDRESSAL FORUM-II, U.T. CHANDIGARH

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[1]     Mrs. Kiran Sarang w/o Sh. Arvinder Singh Puri, aged 52 years;

[2]     Arvinder Singh Puri S/o Sh. Harnam Singh Puri, aged 54 years;

Both residents of House No. 10, Phase 3-B-I, Mohali – 160055.

                                      ---Complainants

Vs

[1]     The Bajaj Auto Finance Limited (Bajaj Finance), through its Manager/ Regional Manager, SCO 56, Sector 26-D, Madhya Marg, Chandigarh.

[2]     The Bajaj Auto Finance Limited (Bajaj Finance), through its National Manager (Insurance Services), 4^th Floor Survey, #208/1-B, Viman Nagar, Pune – 411010.

[3]     The Bajaj Auto Finance Ltd. (Bajaj Finance), through its MD/ CMD 4^th Floor Survey, #208/1-B, Viman Nagar, Pune – 411010.

[4]     Bajaj Allianz Life Insurance Company Limited, through its Manager/GM, Sector 8, Chandigarh.

[5]     Bajaj Allianz Life Insurance Company Limited, through its MD/CMD, Regd. Head Office: GE, Airport Road Yerwada, Pune – 411006.

---- Opposite Parties

BEFORE:         SH.LAKSHMAN SHARMA                           PRESIDENT

MRS.MADHU MUTNEJA                              MEMBER

                        SH.JASWINDER SINGH SIDHU                  MEMBER

Argued By:      Sh. R.M. Dutta, Counsel for Complainants.

Sh. Jatin Kumar, Counsel for Opposite Parties No. 1 to 3.

Sh. Varun Chawla, Counsel for Opposite Parties No. 4 to 5.

PER MADHU MUTNEJA, MEMBER

1.                The Complainants have stated that they had availed a loan of Rs.40,50,000/- against property from Opposite Party No.1.  As per the Complainants, the Complainant No.1 was the Applicant and Complainant No.2 was the co-Applicant. The loan was for a tenure of 120 months with an EMI of Rs.61,070/- per month (Annexure C-1).  Also, in terms of the Bajaj Finance Personal Accident Cover Policy, all loans against property were covered under a Group Personal Accident Cover of Bajaj Allianz General Insurance Company Limited free of cost. The coverage was for a period of one year and applied only to the principal borrower.  

                   The Complainants have stated that they were never interested in any insurance and specifically told Opposite Party No.1 about the same. However, while realizing the loan, the Opposite Parties deducted a sum of Rs.50,000/- as insurance premium for the same on 01.12.2009 (Annexure C-3). The Complainants received a letter dated 23.11.2009 from the Opposite Parties informing about the Master Policy No. 125586625 on the life of co-Applicant Shri Arvinder Singh Puri and Applicant as a nominee for a sum of Rs.6,95,940/-. The Complainants contacted Opposite Party No.4 for cancellation of the Policy, but were forwarded to Opposite Party No.2. Thereafter, the Complainant took up the matter with the Opposite Parties a number of times to cancel the Policy, but the Policy was not cancelled. The certificate of insurance was received by the Complainant on 21.09.2010, despite the fact that they had been requesting the Opposite Parties for refund of the premium from the very beginning. The Complainants thereafter, wrote to the Opposite Parties for refund of the insurance premium on 23.09.2010 and also issued a legal notice to the Opposite Parties for the same.

                   As the Opposite Parties have not refunded the amount, the Complainants have filed this complaint with allegations of deficiency in service and unfair trade practice, with a request that the amount of Rs.50,000/- deducted as insurance premium be refunded, along with compensation and costs.

2.                After admission of the complaint, notices were sent to the Opposite Parties.

3.                Opposite Parties No.1 to 3 has stated that they are primarily engaged in the business of providing consumer finance through various schemes and financed products. They have submitted that the Complainants are not consumers as the Board of Directors of M/s J.D. Cement Pvt. Ltd. have passed a resolution on 05.11.2009 authorizing Mr. Arvind Singh Puri to negotiate, discuss, settle, finalize and accept the terms & conditions of the loan facility from Bajaj Auto Finance Ltd. and to take such actions as may be necessary in this behalf. The loan has been availed by the Company for purpose of balance transfer and there is a separate application form signed by Mr. Arvind Singh Puri by putting the stamp of M/s J.D. Cement Private Limited. The loan has since been foreclosed by said M/s J.D. Cement Private Limited.  Hence loan was availed of by M/s J.D. Cement Private Limited only and also later foreclosed by M/s J.D. Cement Private Limited.  Also the loan was availed for commercial/ business purpose only. Accordingly, the Complainants are not consumers of the answering Opposite Parties as per Section 2(1)(d) of the Consumer Protection Act, 1986. 

                   Answering Opposite Parties have further stated that at the time of taking loan, the loan agreement was signed by Ms. Kiran Sarang (Complainant No.1) as Borrower and M/s J.D. Cement Private Limited as Co-borrower. The Group Suraksha Policy is issued as an add on benefit to the customer where the loan amount is high, in order to protect the interest of the Opposite Parties in case of death of the Borrower or co-borrowers. Hence, the borrower is required to take Single Premium Group Suraksha Policy Scheme.  The Policy is not provided free of cost and is governed by the terms and conditions of the Policy issued by Bajaj Allianz Life Insurance Co. Ltd. The Complainants had agreed to take the Group Suraksha Policy and had signed all the relevant documents in this regard. Both the Complainants being well educated, it is not possible that they could have put signatures on blank documents. The amount of insurance premium has been mentioned in the request for disbursal and sanction letter, as also the insurance enrolment form was duly accepted by the Complainant No.2. Further, the Complainants have not contacted any officials of Bajaj Allianz Life Insurance Co. Ltd. and no letter has been received from them with regard to cancellation of the Policy.   All letters received by answering Opposite Parties are always acknowledged by putting signature and stamp. It is only after the Complainant foreclosed the loan in Nov., 2010, that they have taken up the issue with regard to refund of insurance premium which is an afterthought. Hence, as the insurance premium was made as per the request of the Complainant through the insurance enrolment form and the request for refund was not made within 15 days of receipt of insurance certificate, the Opposite Parties are not liable to refund the amount of Rs.50,000/-.

                   Denying all other averments of the Complainant, the Opposite Party No.1 has prayed for dismissal of the complaint. 

4.                Opposite Parties No. 4 and 5 in their reply have taken the preliminary objection that the Complainants are not consumers as the contract of insurance was between the Master Policyholder i.e. Bajaj Auto Finance and the Insurance company i.e. answering Opposite Parties and the Complainant No. 2 is only a Member to the Master Policy to Bajaj Auto Finance hence, there is no privity of contract between the Member and the Insurance Company.  The Complainant No.2 himself opted to join as a Member of the Group Suraksha Master Policy and submitted Enrolment Form dated 18.11.2009. The certificate of insurance was issued on 26.12.2009 with modal single premium of Rs.50,000/-. The said Member Mr. Arvinder Singh Puri appointed his wife Ms. Kiran Sarang as a nominee under the said policy and continue to enjoy the risk coverage as the Member of the Master Policy. As per the terms and conditions of the membership, there was a free look period of 15 days from the date of receipt of the certificate which was not availed of by the Complainants. The policy was dispatched to the Complainant on 11.1.2010.

                   On merits, the Opposite Parties have reiterated the above submissions and stated that they have acted in accordance with the guidelines of IRDA. The premium was legally and rightly calculated as per the risk coverage opted by the Complainant.  Opposite Parties have also questioned the territorial jurisdiction of this Forum stating that the Complainants are the permanent residents of Mohali.

                   Denying all other averments of the Complainant, Opposite Parties No.4 and 5 have prayed for dismissal of the complaint.

5.                After receipt of reply, the Complainants filed rejoinder. In the rejoinder, the Complainants have reiterated that they were forcibly issued insurance by the Opposite Parties at the time of availing the loan. All other submissions made by the Opposite Parties in their reply have been stated to be wrong and denied. Accordingly, the Complainants have prayed for refund of the insurance premium by stating that non-refund amounts to deficiency in service and unfair trade practice.

6.                Parties led evidence in support of their contentions.

7.                We have heard the learned counsel for the parties and have perused the record.

8.                The case of the Complainants is that the Opposite Parties have forcibly made them take an insurance policy at the time of availing the loan of Rs.40,50,000/-. An amount of Rs.50,000/- was deducted at the time of disbursement of the loan. The Opposite Parties have denied this allegation by stating that the Complainants have themselves opted for the Group Insurance Policy, which was signed between the Opposite Parties and Complainant No.2 to secure the loan issued to the Company. Opposite Parties have also taken an objection that the loan was sanctioned to M/s J.D. Cement Pvt. Ltd. and not to the Complainants. In support of their contention, Opposite Parties have placed on record documents (R/1 to R/5), duly filled in by the Complainants, wherein Mrs. Kiran Sarang has been shown as the Applicant for the loan while her husband in his capacity as authority signatory of M/s J.D. Cement Private Limited has been shown as the co-Applicant. The papers have been signed by the Complainants in their personal capacity, as well as by Arvinder Singh Puri as Director of M/s J.D. Cement Private Limited.  Annexure R/4 which was duly signed by both the Complainants in their individual capacity as well as by the Complainant No.2 ‘for M/s J.D. Cement Private Limited’ is the application for the loan against property wherein the loan amount has been shown as Rs.40,50,000/- and the insurance amount has been shown as Rs.50,000/-.  After the Complainants have signed this application form, we cannot understand as to how they can make allegations of unfair trade practice and deficiency in service on the part of the Opposite Parties stating that they have been induced to take the insurance. The policy has not been refused/ returned in the free look period. The period of insurance was for five years, while the term of loan was 12 years. In the request for disbursal of loan made to Bajaj Auto Finance Limited (Annexure R/9), the Complainants have requested for Cheques (i) favouring HDFC Ltd. (ii) favouring HDFC Ltd. (iii) favour J.D. Cement (P) Ltd. (iv) favouring Bajaj Allianz Life Insurance Co. Ltd. It is, thus clear that the Complainants are in agreement to the disbursal of Rs.50,000/- for the insurance cover being provided to them.  It seems to be an afterthought after the foreclosure of loan that the Complainants do not want the insurance now. Hence they have raked up the issue of alleged deficiency in service and unfair trade practice by the Opposite Parties for forcing them to take the policy at the time of disbursal of loan, only after the loan to the Company has been foreclosed. In our opinion the Complainants have no case with the given facts as they have not availed of the right to cancellation of the Policy in the free look period.

9.                Also, the allegations by the Complainants for mental tension, harassment, torture, agony, deficiency in service and unfair trade practice are not acceptable without cogent evidence or proof of the same.  The Hon’ble Supreme Court of India in case GODFREY PHILLIPS INDIA LTD. V AJAY KUMAR, (2008) 4 Supreme Court Cases 504, has held as under: -

“Consumer Protection Act, 1986 – Ss. 14(1)(d), 18 and 22(1) – Compensation – Condition precedent for grant of compensation, held, is loss or injury suffered due to negligence of the Opposite Party – In the absence of allegation or material on record to show negligence, grant of compensation, held, improper – More so when there was no allegation or finding of loss or injury caused to the Complainant.”

                   In GHAZIABAD DEVELOPMENT AUTHORITY V BALBIR SINGH, (2004) 5 Supreme Court Cases 65, the Hon’ble Apex Court has held as under: -

“Consumer Protection Act, 1986 – Ss. 14(d) and proviso thereto, 18 [as amended in 2002] and 22(1) [as amended in 2002] – Compensation – Principles of award of – Held, since what is being awarded is a recompense for loss or injury, it therefore necessarily has to be based on a finding of loss or injury and has to correlate with amount of loss or injury.”

                   The Hon’ble Supreme Court of India has also held in Indian medical association v. V.P.Santha and other, (1995) 6 Supreme Court Cases 651, that Section 14(1)(d) indicates that compensation to be awarded is for loss or injury suffered by the consumer due to negligence of the Opposite Party.

10.              In the present case, no loss or injury has been shown by the Complainants caused due to the negligence of the Opposite Parties. Also, they have not availed of the benefit of cancellation of Policy in the free look period of 15 days. Hence, we deem it appropriate to dismiss the complaint as the Complainants have not been able to satisfy us about the genuineness of their claim. No costs.

11.              Certified copy of this order be communicated to the parties, free of charge. After compliance file be consigned to record room.

Announced

07^th August, 2012.                                                                         

Sd/-

(LAKSHMAN SHARMA)

PRESIDENT

Sd/-

(MADHU MUTNEJA)

MEMBER

Sd/-

 (JASWINDER SINGH SIDHU)

MEMBER