DATE OF FILING: 12.03.2014
DATE OF DISPOSAL: 06.03.2018
Mr. Karuna Kar Nayak, President:
The complainants’ have filed this consumer dispute Under Section 12 of the Consumer Protection Act, 1986, alleging deficiency in service against the Opposite Parties ( in short the O.Ps) and for redressal of their grievance before this Forum.
2. The complainants’ case in brief is that they are the legal heirs of late Magata Swain the deceased policy holder. Late Magata Swain the deceased father of complainants’ was resident of Qr. No. 2R/50, Bidyutpuri colony, Post: Engineering School, Berhampur during his life time he was serving as a Helper under SOUTHCO, Berhampur under O.P.No.3 and got his life insured with the service Branch Office 585 policy No. 571483890 on dated 28.9.2009 in Table No. 165 in Term -14 under SSS Jeevan Sarala Scheme for the death benefit assured sum of Rs.1,50,000/- with triple benefits profit on the occasion of death of the insured. Gurubari Swain wife of late Magata Swain (the policy holder) was the nominee of the said LIC policy of the deceased. The monthly premium installment amount sum of Rs.612/- was deducted from monthly salary of late Magata Swain under salary saving scheme of the LIC policy, during his life time and remitted to the Branch Manager, LIC of India, City Branch Office-1 of Berhampur, the O.P.No.1 by the employer of the said policy holder the office of Executive Engineer, Berhampur Electrical Davison No.1, Berhampur. The said policy holder late Magata Swain died on 04.11.2010 and his wife late Gurubari Swain the nominee of said policy who was bed-ridden from the date of death of said policy holder was also died on dated 7.3.2012. It is the bounden duty of the employer of the said policy holder the O.P.No.3 to deduct the monthly installment premium sum of said LIC policy and to remit or deposit the same against the policy with the LIC of India, City Branch Office- 1, Berhampur the O.P.No.1 in each month regularly. In case the O.P.No.3 the employer of said policy holder not deposited the premium amount regularly as an Agent of the scheme of the said policy with the O.P.No.1 in such circumstance the O.P.No.1 had not taken any step for the collection of monthly installments premium value from the O.P.No.3 from the monthly salary of the policy holder then the policy holder is not responsible or defaulted in payment of premium as the said affair is a transaction between the O.P.No.3 and 1 and the payment of premium amount by deducting from the salary of the employee is an affair between the employer and the LIC the O.P.No.1 was not for the employee to intimate the LIC authority about non-remittance of the premium amount towards the said policy if any as the employer O.P.No.3 acts as an agent of LIC of O.P.No.1. the principal i.e. the LIC is liable for the action or inaction of the agent. The employer of the policy holder the O.P.No.3 though is not designated as the agent of the LIC, the O.P.No.1 in view of section 168 of the Law of Contract Act. Even if the employer of the deceased policy holder had failed to make payment of the premium value, the Principal i.e. the LIC is liable to make payment of the assured amount with the stipulated benefit as per the terms of the Jevan Saral Policy to the complainants under the Salary Savings Scheme LIC policy of the deceased policy holder. In view of the said legal position of the transaction, the complainants being the legal heirs of the deceased policy holder and the deceased nominee of the said LIC policy lodged claim before the O.P.No.1 claiming the triple benefit of the said Jeevan Sarala LIC policy with profit in policy Number 571483890 but the O.P.No.1 declined to entertain their claim without showing any lawful cause or ground which is contrary to law, deficiency in service, illegal and dishonest trade practice, inaction and negligence of the O.P.No.1 and 2 and caused them to suffer from mental agony, frustration, harassment and wrongful loss etc. Therefore, the O.Ps are liable to make payment of assured sum with triple SSS benefit of the said LIC policy to the complainants, but the O.Ps 1 and 2 have not settled the death claim of the complainants and not paid their legitimate death claim against the said LIC policy. On 2.9.2013 the complainants had issued legal demand notice by registered post with AD through their Advocate. On 12.02.2014 the O.P.No.3 replied the legal claim notice regarding deposit of premium amounts of Rs. 7495/- to the O.P.No.1 regularly in respect of said policy number. Non-settlement of claim of the complainants by the O.Ps is contrary to law and non-sustainable in the eye of law in force. Alleging deficiency in service on the part of the O.Ps the complainant prayed to direct the O.Ps who are jointly and severally liable to make payment of assured sum of the said Jeevan Sarala LIC Policy with triple benefit amounting to sum of Rs.4,50,000/- with interest @ 12% from the date of default i.e. from the date of death of the policy holder on 4.11.2010 till disbursement of the claim amount to the complainants with cost.
3. Upon notice the O.P.Nos. 1 & 2 filed version through their advocates jointly. It is stated that the averments made by the complainant in his complaint petition are not true, valid and binding on these O.Ps and the complainant is put to strict proof of all such averments, which are not specifically admitted hereunder. The complaint is manifestly outside the purview of the C.P.Act, 1986 and in any event the act is in addition to and not in derogation of the provisions of the civil and criminal act. The present complaint is baseless and flagrant abuse of process of law aimed to harass and black above answering O.P.No.1 & 2. The complainants have no locus standi to file the present proceedings. The complaint is bad for non joinder of necessary party and is liable to be dismissed. The cause of action arose for the above complain case on 4.11.2010, but the present case filed by the complainant in the month of March 2014. Hence the present complaint is barred by limitation Under Section 24 (A) of the Consumer Protection Act, 1986. The policy No. 571483890 no legal heir certificate has been submitted by the complainant before the authority of LIC of India. Further in respect of policies where the title is open, LIC of India is settling the claim on the basis of “Succession Certificate” but not on the basis of Legal Heir Certificate according to the manual provision of the Corporation. One policy No. 571483890 has been taken by Magata Swain for sum assured of Rs.1,50,000/- Jeevan Saral in salary saving scheme under SOUTHCO, Executive Engineer, Berhampur Electrical Division-1. The monthly premium instalment amount of Rs.612/- was deducted from monthly salary of Magata Swain by the O.P.No.3 under Salary Saving Scheme of the Corporation and remitted to the Branch Manager, City Branch Office 1, Berhampur. The premium has been received and adjusted up to May 2010 by the LIC of India. However an amount of Rs.3060/- has been received from the O.P.No.3 vide BOC No. 8170 dated 15.1.2013, consists of 5 installment dues in the above policy of late Magata Swain i.e. after 2 years and 2 months of death of the deceased life assured. As per the official records, the death of the policy holder as well as the death of the nominee has not been intimated to the LIC of India by the complainant. As per the legal notice dated 2.9.2013 served on the O.P.No.1 & 2 by the complainants , it came to the knowledge of O.Ps that the policy holder died on 4.11.2010 and as on date of death of the policy holder the policy is in lapsed condition and the First Unpaid Premium being June 2010. As per the provision, the O.P.No.1 & 2 are not liable to settle the claim in a lapsed policy. It is the duty and responsibility of the policy holder to see that the premium of his policy is being regularly paid. The O.P.No.1 and 2 made necessary enquiry into the matter after getting legal notice from the complainants. The concerned file reflects that the aforesaid policy of Magata Swain is in lapsed condition at the time of his death. The death of the policy holder as well as the death of the nominee has not been intimated to the O.P. as per provision. Again the O.P.Nos. 1 & 2 submitted that the question of disbursement of the claim amount to the complainant does not arise as the said policy No. 571483890 has already been in lapsed condition at the time of his death on 4.11.2010. The allegations of defect/default/negligence or deficiency in service are wholly misconceived, baseless, false concocted, unsustainable in law besides being extraneous and irrelevant with regard to the facts and circumstances of the matter under reference. Hence the O.P.No.1 & 2 prayed to dismiss the case with costs.
4. Upon notice the O.P.No.3 filed version through his advocate. It is stated the allegations made by the complainant against the O.P.No.3 are all false and frivolous, so the same are hereby denied as vague and concocted. The assertions made in Para-B this O.P. has got no direct knowledge, thus needs no comment. It is true and fact that late Magata Swain was serving as Helper at B.E.D. No.1, SOUTHCO, Berhampur under O.P.No.3 during his life time. The assertions made at Para-C are correct. The monthly premium @Rs.612/- against LIC policy No. 571483890 has been deposited by the O.P.No.3 in the LIC of India, City Branch Office No.1, Berhampur deducting from the salary of said Helper Magata Swain regularly till May 2010. Subsequently towards the premiums for the month of 06/2010 (05 months @Rs.612/-) i.e. Rs.3060.00 was remitted to the said LIC office under cheque No. 130036 dated 15.01.2013 after sanctioning of commuted leave from 01.06.2010 to 10.08.2010 and passing of bills vide office order No. WE-7/12-13. The allegations made at Para-D against the O.P.No.3 are not correct and the complainants shall put to strict proof of the same. It is not true that the policy holder is not responsible or defaulted in payment of premium and that the deducting from the salary of the employee is an affair between the employer and the LIC the O.P.No.1 and not for the employee to intimate the LIC authority about non-remittance of the premium amount towards the said policy and the O.P.No.3 acts as the Agent of LIC O.P.No.1 principal who is liable for the action or inaction of the agent. The policy holder/employee under S.S.S. is also equally liable and responsible to get deduction of premium from his salary and remitted to the LIC every month in order to avoid lapse of policy. His duties and responsibilities in no way will be waived out simply authorizing the employer to remit the premium, deducting his salary. He must vigilantly watch before receiving his salary, if his premium is deducted and remitted towards his insurance policy or not. What so ever, in the instant case the office of the O.P.No.3 has been regularly deposited/ remitted the monthly premium without any intentional fault. The said Magata Swain was on leave on medical ground from 01.06.2010 to 01.08.2010 (71 days) and expired on 04.11.2010. So the premium for the months i.e. from 06/10 to 10/2010 (5 months) could not be remitted as his salary was not drawn during the same period. However, when his leave of the above period was sanctioned on medical ground vide office Order No. WE-7/12-13 and letter No. 2132(8) dated 30.04.2012 deducting from his salary after payment of the same bill, the due LIC premiums for said 05 months i.e. Rs.3060.00 was remitted to the said LIC office under cheque No. 130036 dated 15.01.2013. It is true that the O.P.No.3 has deposited the premiums until months of October 2010 and the deceased policy holder was expired on 4.11.2010. So no intentional latches or negligence could be attributed against him. It is not true that the present respondent/O.P.No.3 is severally or jointly liable to make payment of assured sum or interest, penalty, cost or compensation against the above LIC policy of the deceased employee. The same allegations are vague and vexatious and thus not tenable as per law. The claims of complainants, if any against the present O.P.No.3 is not tenable and is liable to be set-aside. It is not true that the complainants are entitled to realize their above claim against the O.P.No.3. Any claim against him is not tenable and is liable to be rejected. Hence prayed to dismiss the above complaint against O.P.No.3 with cost in the best interest of natural justice.
5. On the date of hearing of the consumer complaint advocate for complainant, advocate for O.P.No.3 are present before this Forum. The advocate for O.P.No.1 & 2 are absent. Due to absence of advocate of O.P.No.1 & 2 in several dates, we heard the matter from the advocate of complainant so also advocate of O.P.No.3 at length and gone through the materials and have also perused the documents submitted by both parties in support of the case respectively. During the course of hearing advocate for the complainant submitted that complainants are the legal heir of late Magata Swain deceased policy holder and late Gurubari Swain deceased (nominee) in this case. Late Magata Swain insured his life under LIC City Branch Office O.P.No.1 at R.C.Church Road, Berhampur in LIC Policy No. 571483890, date of commencement 28.09.2009 in Table No. 165 in Term No. 14 under SSS Jeevan Sarala Scheme for the death benefit assured sum of Rs.1,50,000/- with triple benefit profit on the occasion of death of the insured. The policy holder died on 04.11.2010. The nominee Gurubari Swain is the wife of deceased died on 07.03.2012. The deceased policy holder working under O.P.No.3 and O.P.No.3 deducted monthly installment premium sum of the LIC policy and remitted or deposited the same against the policy with the LIC. The O.P.No.1 is the LIC office who received the deducting salary amount against this policy. This is a salary saving scheme of LIC and it is an admitted that that the O.P.No.3 deposited total premium amount Rs.7495/- of the policy holder late Magata Swain alongwith 4 others till the date October 2010. The said amount has also been received by O.P.No.1. The advocate for the complainant further argued that O.P.No.3 issued vide BOC N0.8170 dt.15.1.2013 against the premium of late Magata Swain till her death (October 2010) which was received by O.P.No.1. Therefore premium amount has been paid by the O.P.No.3 to the O.P.No.1 &2 regularly till the death of policy holder. The complainants are the legal heir of late policy holder. As the nominee was already died within the claim period his legal heirs are entitled to get all benefits. The advocate for the complainant further specifically stated that non settlement of claim of the complainant by the O.Ps. is contrary to the law and non sustainable in the eye of law in force. The O.P.No.1 & 2 are liable to make payment of assured sum of the said Jeevan Saral amounting sum of Rs.4,50,000/- with 12% interest from the date of death of the policy holder. The complainants are consumer under the statutory rights as they are the legal heirs of the nominee. The advocate for complainant also further cited decisions published in A.I.R. 2005 of Supreme Court of India in page 3086 in Chairman of LIC versus S.K.Bhaskar , in which the Honorable Apex Court has hold that “even if the Employer has failed to make payment of the premium, the principal i.e. the LIC is liable to pay the assured amount to the complainants of the said salary savings scheme policy”. Therefore advocate for complainant argued that the complainants are entitled to get triple benefit of the sum assured of S.S.S. policy No. 571483890 of the deceased policy holder late Magata Swain. The complainants are entitled to receive sum assured with interest, cost and compensation in the interest of justice.
6. On the contrary learned counsel for the O.P.No.1 and 2 are contended in written argument that in this case complainants are not entitled to get claim amount because they are not submitting “Succession Certificate” before the O.P. No.1. Further learned counsel for the O.P.No. 1& 2 pointed out that LIC of India is settling the claim on the basis of “Succession Certificate” but not on the basis of “legal Heir Certificate” as per contract. It is also a fact that the monthly premium installment amount sum of Rs.612/- was deducted from monthly salary of Magata Swain by O.P.No.3 under salary saving scheme of the LIC policy and remitted to the Branch Manager, LIC of India , City Branch Office No.1, Berhampur. However, Rs.3060/- has been received from the O.P.No.3 vide BOC No. 8170 dt.15.1.2013 consists of five dues of premium relating to above mentioned policy of late Magata Swain after 2 years and 2 months of death of the deceased life assured. Further clarified that a legal notice was sent dated 02.09.2013 served to O.P.No.1 &2 that the policy holder died on 04.11.2010, at that time of death of policy holder in the policy is in lapsed condition. Hence O.P.No.1 &2 are not liable to settle the claim in a lapses policy. It is the duty and responsibility of the policy holder to see that the premium of his policy is being regularly paid. On the basis of legal notice by the complainant, O.P.No.1 & 2 made necessary inquiry into the matter. There found the policy of Magata Swain is in lapsed condition at the time of death of policy holder within the period of settlement the nominee has not been intimated to the O.Ps for settling of claim amount. So the allegations of defect/default/negligence or deficiency in service does not arise on the part of the O.Ps. All the averments made therein in the complaint are baseless, wrong and are emphatically denied. The O.P.No.1 & 2 have not made any deficiency in service, hence they may have exempted any liability fixing in the interest of justice.
7. Similarly advocate for the O.P.No.3 representing before this Forum and submitted his views regarding this matter. He also admitted that deceased policy holder Magata Swain purchased a LIC Bond under monthly premium @Rs.612/- against LIC policy No.571483890. Subsequently towards the premiums for the months of 06/2010 to 10/2010(5 months) of Rs.3060/- was remitted to the said LIC office under cheque No. 130036 dated 15.1.2013 after sanctioning of commuted leave from 01.06.2010 to 10.08.2010 and passing of bills, vide office order no. WE-7/12-13. The allegation of the policy holder that he is not responsible or defaults of any payment of premium or defaulted in payment of premium. The O.P.No.3 deducting from the salary of the employee is an affair between the employer and the LIC OP No.1 and not for the employee to intimate the LIC authority about non-remittance of the premium amount towards the said policy and the O.P.No.3 acts as the agent of LIC O.P.No.1. It further submitted that the policy holder/employee under S.S.S. is also equally liable and responsible to get deduction of premium from his salary and remitted to the LIC every month, in order to avoid lapse of policy. His duties and responsibilities in any way will be never waived out simply authorizing the employer to remit the premium, deducting his salary. He must vigilantly watch before receiving his salary, if his premium is deducted and remitted towards his insurance policy or not. What so ever, in the instant case the office of the O.P.No.3 has been regularly deposited/remitted the monthly premium without any intentional fault. It may be further submitted that said Magata Swain was availing leave on medical ground from 1.6.2010 to 1.8.2010 (71 days) and expired on 4.11.2010. So the premium for the months i.e. from 06/10 to 10/10 (05 months) could not be remitted as his salary was not drawn during the same period. However, when his leave of the above period was sanctioned on medical ground vide Office Order No. WE-7/12-13 and Letter No. 2132 dt.30.04.2012 deducting from his salary after payment of the same Bill, the due LIC premiums for said 05 months i.e. Rs.3060/- was remitted to the said LIC Office under cheque No. 130036 dt.15.01.2013. The allegation made by the complainant against O.P.No.3 is frivolous and vexatious complaint, under false and fabricated allegations thus O.P.No.3 is not liable in the interest of justice as he has already deposited the amount to O.P.No.1 & 2.
8. From the aforesaid discussion, it is crystal clear that the policy holder is a genuine policy holder under the LIC and all premiums are paid to the O.P.No.1 and 2. The O.P.No.2 received premium amount of Rs.3060/- against the policy of deceased on 15.1.2013. Gurubari Swain the nominee of the deceased policy holder late Magata Swain also died on 7.3.2012 prior to installment paid by the O.P.No.3. Hence nominee could not get the amount of the deceased policy holder. After that a legal heir certificate submitted by the legal heirs of Magata Swain and Gurubari Swain before LIC authority. Neither O.P.No.1 & 2 submitted any relevant papers to be communicated to the complainant in regard to submit succession certificate instead of legal heir certificate. As O.P.No.1 and 2 not intimated the proper procedure to be maintained by the complainant, complainant could not deposit all relevant papers to the office of LIC. The LIC could not get any plea that premium was not paid at the time of death as they received the amount from O.P.No.3 towards the premium of the deceased policy holder. Similarly LIC has not intimated to O.P.No.3 not to deduct the premium amount after death of the policy holder. In such circumstances deficiency in service by O.P.No.3 and 1 came to lime light. As the O.P.No.3 deducted the amount from salary and deposited before O.P.No.2 it clearly indicates that the policy is intact till 15.1.2013. As nominee of the deceased died on 07.03.2012, so she could not proceed the legal formalities prior to deposit the premium amount. Hence in such a situation complainants obtained the legal heir certificate from the Tahasildar and submitted the claim voucher before O.P.No.2. The O.P.No.2 has also not intimated the complainants to produce succession certificate instead of legal heir certificate. It is also pertinent to mention here that the complainants are first class legal heirs of the deceased policy holder late Magata Swain. So in the instant case legal heir certificate is sufficient to settle the claim instead of succession certificate.
9. On foregoing discussion, in our considered view there is deficiency in service on the part of O.P.No.1 and 2 and there is no liability on the part of O.P.No.3 as O.P.No.3 is a mear acting as an agent of LIC and deposited the previous amount before O.P.No.2. As such we are fixing the liability against O.P.No.1 and 2 who are jointly and severally liable to pay the death claim of policy No.571483890 alongwith other benefit to the complainants. As the complainants are not submitting any supporting documents for harassment, so compensation could not be allowed against the O.Ps but we inclined to award litigation expenses against O.P.No.1 & 2.
10. In the result, the complainants’ case is partly allowed against O.P.No.1 & 2 and dismissed against O.P.No.3. Both the O.P.No.1 & 2 are directed to settle the claim of policy No. 571483890 of late Magata Swain as per guidelines of IRDA in favour of the complainants after receiving the relevant documents and also directed to pay Rs.2,000/- towards costs of litigation to the complainants. The aforesaid order shall be complied by the O.Ps within 45 days of receipt of this order, failing which all the due shall carry 9% interest per annum. The case of the complainants is disposed of accordingly.
12. The order is pronounced on this day of 06th March 2018 under the signature and seal of this Forum. The office is directed to supply copy of order to the parties free of cost and a copy of same be sent to the server of
