The Branch Manager, LIC of India, V/S Smt. Umadevi W/o Late, Shivalingappa - Consumer Court Case

Karnataka

Raichur

DCFR 9/08

Smt. Umadevi W/o Late, Shivalingappa - Complainant(s)

Versus

The Branch Manager, LIC of India, - Opp.Party(s)

M Mallanagoud

30 Jul 2008

ORDER

DIST. CONSUMER DISPUTES REDRESSAL FORUM
DIST. CONSUMER DISPUTES REDRESSAL FORUM,DC Office Compound, Sath Kacheri
consumer case(CC) No. DCFR 9/08

Smt. Umadevi W/o Late, Shivalingappa						...........Appellant(s)
Vs.
The Branch Manager, LIC of India, The General Manager, Hutti, Gold Mines Co.Ltd.						...........Respondent(s)

BEFORE:

Complainant(s)/Appellant(s):

OppositeParty/Respondent(s):

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ORDER

BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM RAICHUR. COMPLAINT NO. DCFR. 9/08. THIS THE 30th DAY OF JULY 2008. P R E S E N T 1. Sri. N.H.Savalagi, B.A.LLB. (Spl) PRESIDENT. 2. Sri. Gururaj, B.com.LLB. (Spl) MEMBER. 3. Smt. Pratibha Rani Hiremath,M.A. (Sanskrit) MEMBER. ***** COMPLAINANT :- Smt. Umadevi W/o. Late Shivalingappa, Age: Major, Basavanagar, Hutti, Tq: Lingasugur, Dist: Raichur. //VERSUS// RESPONDENTS :- 1. The Branch Manager, LIC of India, Branch Office, Sindhanoor, Sindhanoor, Dist: Raichur. 2. The General Manager, Hitti Gold Miens Co. Ltd., Hutti, Tq. Lingasugur, Dist: Raichur. CLAIM :- For direction to Respondent NO-1 & Respondent No-2 for payment of the policy amount of Rs. 25,000/- along with bonus interest and other benefits accrued thereon along with sum of Rs. 10,000/- towards damages and cost. Date of institution :- 27-02-08. Notice served :- 01-04-08. Date of disposal :- 30-07-08. Complainant represented by Sri. Mallangouda, Advocate. Respondent No-1 represented by Sri. Keshavacharya, Advocate. Respondent NO-2 represented by Sri. M.Ngappa, Advocate. ----- This case coming for final disposal before us, the Forum on considering the entire material and evidence placed on record by the parties passed the following. JUDGEMENT This is a complaint filed U/s. 12 of Consumer Protection Act by the complainant- Smt. Umadevi against Respondents- (1) Branch Manager, Life Insurance Corporation of India Branch Office, Sindhanur, and (2) The General Manager, Hutti Gold Mines Company Ltd., Hutti. The brief facts of the complaint are as under: Complainant is the wife of late Shivalngappa S/o. Devendrappa who was an employee working under the control and employment of Respondent No-2. During his service late Shivalingappa had opted several LIC policies amongst them the policy bearing No. 661366134 dt. 21-08-02 for assured sum of Rs. 25,000/- for a period of (18) years from Respondent No-1 under Salary Saving Scheme. As per the Salary Saving Scheme the Respondent No-2 was making the payment of premium amount of the policy to Respondent NO-1 directly out of salary amount of the said Shivalngappa the late husband of the complainant. The late Shivalngappa died on 11-06-06 during the service leaving behind him the complainant who is the legal heir and nominee to the said life assured. As such the complainant is entitled to receive the amount of the said amount. After the death of her husband Shivalngappa, the complainant made requests to Respondent NO-1 on 29-06-06 for settlement of the policy amount Respondent No-1 written a letter dt. 05-07-06 for submitting original policy bond & discharge Form and accordingly complainant has complied the same. Subsequently the Respondent No-1 informed through letter dt. 10-03-07 stating that nothing is payable for the above said policy as it is in lapsed condition. The policy is under Salary Saving Scheme as such Respondent No.2 is only held responsible for making the payment of premium amount and at no point of time either Respondent No-1 or Respondent No-2 has informed with regard to non-payment of premium to the insured or to the complainant. There is no communication or intimation with regard to the non-payment of the premium. As such the say of the Respondent No-1 that the said policy is in lapsed condition is false and not sustainable. Respondent No-2 being the employer of her deceased husband had undertaken to make the payment of premium of the above said policy out of salary amount of the deceased and also acted as Agent or Respondent No-1, as such both the Respondents are jointly and severally liable to answer the claim of the complainant. The attitude of the Respondents amounts to deficiency in service on the part of the Respondents and also mental torture and agony. Hence for all these reasons the complainant has sought for direction to Respondent NO-1 & Respondent No-2 for payment of the policy amount of Rs. 25,000/- along with bonus interest and other benefits accrued thereon along with sum of Rs. 10,000/- towards damages and cost. 2. The Respondents 1 & 2 appeared through their respective counsel and have filed written version. The Respondent Insurance Company in the written version has contended that late Shivalngappa life assured had taken following policy and amongst them some policy have been settled and one policy is surrendered and another policy bearing No. 661366134 is lapsed as shown below: ------------------------------------------------------------------------------------- Sl.No. Policy No. Remarks ------------------------------------------------------------------------------------ 1. 661243835 Claim settled. 2. 661208615 Claim settled. 3. 661110784 Claim settled 4. 661160570 Claim surrendered 5. 661366134 Claim repudiated. ---------------------------------------------------------------------------------- The payment of the premium of the policy of the deceased being made through Salary Saving Scheme by Respondent No-2. The Respondent No-1 has rightly repudiated the policy No. 661366134 as the policy was having so many gaps. The date of commencement of policy is 21-08-01, the sum assured is Rs. 25,000/-. The first unpaid premium starts from March 2005. On account of payment of premium the said policy the said policy fell into gaps as shown below: 1. Gaps- 10/2001 to 06/2002 9 gaps 2. Gaps- 09/2004 to 01/2005 5 gaps 3. Gaps- 03/2005 to 05/2006 15 gaps -------------- Total 29 gaps -------------- Since the above said policy is lapsed for non-payment of the premium so nothing is payable to the nominee of the deceased. The complainant has to produce Succession Certificate from competent court of law to show that she is the wife of deceased Shivalingappa and to know that she is Legal heir. The insurance is contract between insurer and insured. If the insured pays the premium on stipulated due date either directly or through his employer by salary recovery the risk on the life of the assured will be covered till the next premium falls due. It is the duty and responsibility of assured to pay the premium whenever it falls due. No where it is mentioned in the contract that premium should only be paid on demand. The Insurance Corporation will not owns responsibility of collecting the premium through employer on behalf of life assured. The recovery of premium through salary is the privilege given by the employer to his employees but in case of failure, employee cannot be made either the employer or the Insurer responsible. Because paying premium to have Insurance cover on his own life is left to the insured. As per the authorization letter Annexure-1A the life assured gives an undertaking which reads that the life assured shall be responsible for keeping the policy in-force by ensuring the payment of premium to the Corporation within stipulated time. In the event of the non-payment of premium to the Corporation within the stipulated time, by the employer for whatever reason, it shall be his responsibility to make the payment of the premium directly to the corporation together with any additional charges as applicable for monthly payment of premium and with interest if any to keep the policy in-force. In this case also the employee did not make any arrangement to remit the premium and allowed the policy to become lapse. The question of recovery of premium arises only when there is sufficient salary to recover the premium. Hence the Respondent No-1 is not liable to answer the claim of the complainant and there is no deficiency in service on the part of the Respondent No-1. Hence for all these reasons the Respondent No-1 has sought for dismissal of the complaint with exemplary cost. 3. The Respondent No-2 Executive Officer, Hutti Gold Mines Ltd., has filed written version contending that the late Shivalingappa the husband of the complainant was employed under the Respondent No-2 Corporation he died on 11-06-06. This Respondent No-2 has regularly remitted the premium of late Shivalingappa to the LIC whenever his wages were sufficient. Thereafter due to non-availability of the sufficient wages of said Shivalingappa to pay the premium, the premium could not be remitted to the LIC. The said fact was being regularly informed by the Respondent No-2 to late Shivalingappa and also he had knowledge of non-payment of premium when he took his monthly wage slip. This Respondent NO-2 could not deduct the Insurance premium from the salary of said employee because his earnings were not enough to recover the LIC premium which stands at Clause-1 at Sub-clause (2) of section 7 of Payment of Wages Act, because the deductions are to be made on the basis of priority as per the provisions of law. Therefore the non-payment of premium of said employee by deducting from his salary did not fall in the order of priority. Hence Respondent No-2 is neither negligent nor violated any alleged undertaking claim to LIC. So he is not liable to damages and compensation as claimed. Hence for all these reasons Respondent No-2 has sought for dismissal of complaint with cost. 4. During the course of enquiry the complainant has filed her sworn-affidavit by way of examination-in-chief. In-rebuttal the Assistant Administrative Officer of Respondent No-1 Corporation has filed sworn-affidavit by way of examination-in-chief as RW-1. Similarly the Executive Director of Hutti Gold Mines has filed sworn affidavit of Respondent No-2 by way of examination-in-chief as RW-2. On behalf of complainant (7) documents were got marked as Ex.P-1 to Ex.P-7. On behalf of Respondent No-1 (3) documents at Ex.R-1 to Ex.R-3 were got marked. The Respondent No-2 has not produced any document to be marked. 5. Heard the arguments of both sides and perused the records. The following points arise for our consideration and determination: 1.Whether the complainant proves deficiency in service by the Respondents, as alleged. 2.Whether the complainant is entitled for the reliefs sought for. 6. Our finding on the above points are as under:- 1. In the affirmative. 2. As per final order for the following REASONS POINT NO.1:- 7. There is no dispute that late Shivalingappa was an employee working under Respondent NO-2 and he had taken Insurance Policy in-question under Salary Saving Scheme and this Shivalingappa died on 11-06-06 and that the present complainant is the nominee of the life assured. The complainant has produced Insurance Policy Bond at Ex.P-1. It shows the insurance policy was taken on 21-08-01 premium payable was Rs,. 152/- p.m. Sum assured is Rs. 25,000/-. The Insurance Company/Respondent No-1 in the written statement has contended that the claim of the complainant was repudiated as the said policy was having so many gaps as under: 1) Gaps (9) From October 2001 to June-2002. 2) Gaps (5) From September 2004 to January-2005. 3) Gaps (15) From March 2005 to May-2006. Total 29 Gaps 8. Respondent NO-2 Hutti Gold Mines in their written version have stated that they have regularly remitted the premium of employee-late Shivalingappa to the LIC whenever his wages were sufficient. Thereafter due to non-availability of sufficient wages of the said Shivalingappa to pay the premium, the premium could not be remitted to the LIC and this fact was being regularly informed to late Shivalingappa and he had also knowledge of non-payment of premium when he took his monthly wage slip. Except this bare contention the Respondent No-2 has not produced any scrap of paper to substantiate that the non-deduction of the premium amount due to insufficient salary has been made known to the policyholder/their employee. What prevented Respondent NO-2 Company from producing the same is not forth coming. In the absence of the same it cannot be said that the non-deduction of the premium amount has been made known to the employee policyholder. 9. As stated above the Respondent No-1 Corporation in the written version have contended that they have repudiated the claim as the said policy was having so many gaps as shown in the table in the written version. From the gaps as shown in the table it shows that there are in all (29) gaps. The First gap comprises (9) months from October 2001 to June 2002, Second gap consisting of (5) months from September-2004 to January-2005. The Third gap comprise of (15) months from March 2005 to May 2006. It further shows that after the expiry of the first gap of (9) months viz., June-2002, the Respondent Company has received the policy premium from July 2002 till August 2004. Similarly after the expiry of 2nd gap period of (5) months viz., January-2005, they have received the premium amount for February 2005. The 3rd gap starts from March 2005 to May-2006. However the Pay slip at Ex.P-7 produced by the complainant shows deduction of LIC premium of Rs. 770.91 Ps from the salary for the month of May-2006. This means premium for May-2006 has been remitted/deducted from the salary of life assured, then the 3rd gap showing non-payment of premium for May-2006 is not correct. Further it appears that the Respondent Insurance Company have accepted the subsequent premium amount after the expiry of the gaps period. No explanation is coming forth as to why they have accepted the premium for the subsequent months after the expiry of gap period. Even there is no whisper as to whether they have accepted the subsequent premium by way of revival of policy (due to non-payment of premium for the gaps period). Even there is no whisper or any material coming forth on behalf of Respondent NO-1 Corporation that they had made any correspondence to Employer/Respondent No-2 or to the employee/policyholder with regard to non-payment of premium amount during gap period or after expiry of gap period. Similarly there is no whisper in the written version of Respondent NO-2 the Employer that they had made correspondence with Respondent No-1 Corporation regarding non-deduction/remittance of policy premium of life assured due to insufficient of salary amount of insured as per the Payment of Wages Act as contended by them. This shows shirking of the responsibility on the part of the Respondent No-2. Had Respondent No-2 intimated either to Respondent No-1 or to employee-late life assured regarding non-deduction/remittance of premium amount on the ground of priority basis and for insufficient salary amount then the Respondent No-1 Corporation could have cautioned the life assurant from lapsing of the policy and that the life assured too could have directly paid the premium amount by avoid lapsing of the policy. 10. As seen from the written version of the Respondent No-1, the act of Respondent No-1 in accepting the premium amount of subsequent months after expiry of gap period of non-payment of the premium, itself shows that the Respondent No-1 have soumoto revived the policy of the life assured. Because when according to the Respondent No-1, there was no payment of premium either by Respondent No-2 from salary deduction or directly paid by the life assured for the (9) months gap period i.e, from October-2001 to June-2002, then they ought not to have accepted the premium amount for July-2002 till the 2nd gap period of (5) months (from September-2004 to January-2005). When the Respondent No-1 accepted the premium amount for subsequent period from July-2002 to August-2004 for more than (2) years, then how the Respondent No-1 would say that the policy is in lapsed condition for non-payment of premium for the gap period. It appears that the Respondent Corporation without making correspondence either with Respondent No-2 or with the life assured for non remittance of premium amount for gaps period and having blindly accepted the premium amount for the subsequent period after the expiry of the gap period, now after the death of the policyholder when the complainant nominee claimed the policy amount they have repudiated her claim by giving dead-reason that the policy is in lapsed condition which is against their own acts and lacunas as stated earlier. When according to them policy is to be lapsed for non-payment of premium, then this principle would have applied for the First gap period of (9) months and they ought not to have accepted the premium amount for subsequent period from July 2002 onwards. When they have let loosed by giving life to the policy then how they could say now that the policy is in lapsed condition. Hence from the above discussion it goes without any hesitation that both the Respondents 1 & 2 are deficient and negligent in their service. This our view is supported by the decision of Honble Supreme Court reported in 2006(1) Civil LJ Page No-1 (Chairman Life Insurance Corporation and others V/s. Rajiv Kumar Bhasker) Head Note which interalia reads as under:- ....employers being agents of insurer-Corporation not entitled to be discharged from contractual obligations on default on the part of employer-Employees not informed about consequences of non-payment of premium both by employer and Corporatin-Therefore, judgements fixing liability on the Corporation needed no interference. In this background the attitude of the Respondents No-1 in not settling the claim of the complainant itself amounts to deficiency in service. Hence we hold that the complainant has proved deficiency in service. So Point NO-1 is answered in the affirmative. POINT NO.2:- 11. The complainant has sought for direction for awarding policy amount of Rs. 25,000/- with accrued benefits thereon and for awarding Rs. 10,000/- towards compensation damages and cost. So far as the 1st part of relief is concerned, the complainant is entitled for policy amount of Rs. 25,000/- with maturity benefits thereon from Respondent No-1. So far as the 2nd part relief of awarding Rs. 10,000/- towards damages and cost, we hold that having regard to the facts and circumstances of the case the ends of justice would be met by awarding Rs. 3,000/- under all heads. In this view of the matter we pass the following order: ORDER The complaint of the complainant is allowed in part. The Respondent No-1 Insurance Company is directed to pay the policy amount to the complainant together with bonus and other maturity benefits along with Rs. 3,000/- towards damages and cost of litigation. The Respondent No-1 shall comply this order within a period of (6) weeks from the date of receipt of copy of this order. Office to furnish certified copy of this order to both the parties forth with free of cost. (Dictated to the Stenographer, typed, corrected and then pronounced in the open Forum on 30-07-08) Sd/- Sd/- Sd/- Smt.Pratibha Rani Hiremath, Sri. Gururaj Sri. N.H. Savalagi, Member. Member. President, Dist.Forum-Raichur. Dist-Forum-Raichur Dist-Forum-Raichur.

BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM RAICHUR. COMPLAINT NO. DCFR. 9/08. THIS THE 30th DAY OF JULY 2008. P R E S E N T 1. Sri. N.H.Savalagi, B.A.LLB. (Spl) PRESIDENT. 2. Sri. Gururaj, B.com.LLB. (Spl) MEMBER. 3. Smt. Pratibha Rani Hiremath,M.A. (Sanskrit) MEMBER. ***** COMPLAINANT :- Smt. Umadevi W/o. Late Shivalingappa, Age: Major, Basavanagar, Hutti, Tq: Lingasugur, Dist: Raichur. //VERSUS// RESPONDENTS :- 1. The Branch Manager, LIC of India, Branch Office, Sindhanoor, Sindhanoor, Dist: Raichur. 2. The General Manager, Hitti Gold Miens Co. Ltd., Hutti, Tq. Lingasugur, Dist: Raichur. CLAIM :- For direction to Respondent NO-1 & Respondent No-2 for payment of the policy amount of Rs. 25,000/- along with bonus interest and other benefits accrued thereon along with sum of Rs. 10,000/- towards damages and cost. Date of institution :- 27-02-08. Notice served :- 01-04-08. Date of disposal :- 30-07-08. Complainant represented by Sri. Mallangouda, Advocate. Respondent No-1 represented by Sri. Keshavacharya, Advocate. Respondent NO-2 represented by Sri. M.Ngappa, Advocate. ----- This case coming for final disposal before us, the Forum on considering the entire material and evidence placed on record by the parties passed the following. JUDGEMENT This is a complaint filed U/s. 12 of Consumer Protection Act by the complainant- Smt. Umadevi against Respondents- (1) Branch Manager, Life Insurance Corporation of India Branch Office, Sindhanur, and (2) The General Manager, Hutti Gold Mines Company Ltd., Hutti. The brief facts of the complaint are as under: Complainant is the wife of late Shivalngappa S/o. Devendrappa who was an employee working under the control and employment of Respondent No-2. During his service late Shivalingappa had opted several LIC policies amongst them the policy bearing No. 661366134 dt. 21-08-02 for assured sum of Rs. 25,000/- for a period of (18) years from Respondent No-1 under Salary Saving Scheme. As per the Salary Saving Scheme the Respondent No-2 was making the payment of premium amount of the policy to Respondent NO-1 directly out of salary amount of the said Shivalngappa the late husband of the complainant. The late Shivalngappa died on 11-06-06 during the service leaving behind him the complainant who is the legal heir and nominee to the said life assured. As such the complainant is entitled to receive the amount of the said amount. After the death of her husband Shivalngappa, the complainant made requests to Respondent NO-1 on 29-06-06 for settlement of the policy amount Respondent No-1 written a letter dt. 05-07-06 for submitting original policy bond & discharge Form and accordingly complainant has complied the same. Subsequently the Respondent No-1 informed through letter dt. 10-03-07 stating that nothing is payable for the above said policy as it is in lapsed condition. The policy is under Salary Saving Scheme as such Respondent No.2 is only held responsible for making the payment of premium amount and at no point of time either Respondent No-1 or Respondent No-2 has informed with regard to non-payment of premium to the insured or to the complainant. There is no communication or intimation with regard to the non-payment of the premium. As such the say of the Respondent No-1 that the said policy is in lapsed condition is false and not sustainable. Respondent No-2 being the employer of her deceased husband had undertaken to make the payment of premium of the above said policy out of salary amount of the deceased and also acted as Agent or Respondent No-1, as such both the Respondents are jointly and severally liable to answer the claim of the complainant. The attitude of the Respondents amounts to deficiency in service on the part of the Respondents and also mental torture and agony. Hence for all these reasons the complainant has sought for direction to Respondent NO-1 & Respondent No-2 for payment of the policy amount of Rs. 25,000/- along with bonus interest and other benefits accrued thereon along with sum of Rs. 10,000/- towards damages and cost. 2. The Respondents 1 & 2 appeared through their respective counsel and have filed written version. The Respondent Insurance Company in the written version has contended that late Shivalngappa life assured had taken following policy and amongst them some policy have been settled and one policy is surrendered and another policy bearing No. 661366134 is lapsed as shown below: ------------------------------------------------------------------------------------- Sl.No. Policy No. Remarks ------------------------------------------------------------------------------------ 1. 661243835 Claim settled. 2. 661208615 Claim settled. 3. 661110784 Claim settled 4. 661160570 Claim surrendered 5. 661366134 Claim repudiated. ---------------------------------------------------------------------------------- The payment of the premium of the policy of the deceased being made through Salary Saving Scheme by Respondent No-2. The Respondent No-1 has rightly repudiated the policy No. 661366134 as the policy was having so many gaps. The date of commencement of policy is 21-08-01, the sum assured is Rs. 25,000/-. The first unpaid premium starts from March 2005. On account of payment of premium the said policy the said policy fell into gaps as shown below: 1. Gaps- 10/2001 to 06/2002 9 gaps 2. Gaps- 09/2004 to 01/2005 5 gaps 3. Gaps- 03/2005 to 05/2006 15 gaps -------------- Total 29 gaps -------------- Since the above said policy is lapsed for non-payment of the premium so nothing is payable to the nominee of the deceased. The complainant has to produce Succession Certificate from competent court of law to show that she is the wife of deceased Shivalingappa and to know that she is Legal heir. The insurance is contract between insurer and insured. If the insured pays the premium on stipulated due date either directly or through his employer by salary recovery the risk on the life of the assured will be covered till the next premium falls due. It is the duty and responsibility of assured to pay the premium whenever it falls due. No where it is mentioned in the contract that premium should only be paid on demand. The Insurance Corporation will not owns responsibility of collecting the premium through employer on behalf of life assured. The recovery of premium through salary is the privilege given by the employer to his employees but in case of failure, employee cannot be made either the employer or the Insurer responsible. Because paying premium to have Insurance cover on his own life is left to the insured. As per the authorization letter Annexure-1A the life assured gives an undertaking which reads that the life assured shall be responsible for keeping the policy in-force by ensuring the payment of premium to the Corporation within stipulated time. In the event of the non-payment of premium to the Corporation within the stipulated time, by the employer for whatever reason, it shall be his responsibility to make the payment of the premium directly to the corporation together with any additional charges as applicable for monthly payment of premium and with interest if any to keep the policy in-force. In this case also the employee did not make any arrangement to remit the premium and allowed the policy to become lapse. The question of recovery of premium arises only when there is sufficient salary to recover the premium. Hence the Respondent No-1 is not liable to answer the claim of the complainant and there is no deficiency in service on the part of the Respondent No-1. Hence for all these reasons the Respondent No-1 has sought for dismissal of the complaint with exemplary cost. 3. The Respondent No-2 Executive Officer, Hutti Gold Mines Ltd., has filed written version contending that the late Shivalingappa the husband of the complainant was employed under the Respondent No-2 Corporation he died on 11-06-06. This Respondent No-2 has regularly remitted the premium of late Shivalingappa to the LIC whenever his wages were sufficient. Thereafter due to non-availability of the sufficient wages of said Shivalingappa to pay the premium, the premium could not be remitted to the LIC. The said fact was being regularly informed by the Respondent No-2 to late Shivalingappa and also he had knowledge of non-payment of premium when he took his monthly wage slip. This Respondent NO-2 could not deduct the Insurance premium from the salary of said employee because his earnings were not enough to recover the LIC premium which stands at Clause-1 at Sub-clause (2) of section 7 of Payment of Wages Act, because the deductions are to be made on the basis of priority as per the provisions of law. Therefore the non-payment of premium of said employee by deducting from his salary did not fall in the order of priority. Hence Respondent No-2 is neither negligent nor violated any alleged undertaking claim to LIC. So he is not liable to damages and compensation as claimed. Hence for all these reasons Respondent No-2 has sought for dismissal of complaint with cost. 4. During the course of enquiry the complainant has filed her sworn-affidavit by way of examination-in-chief. In-rebuttal the Assistant Administrative Officer of Respondent No-1 Corporation has filed sworn-affidavit by way of examination-in-chief as RW-1. Similarly the Executive Director of Hutti Gold Mines has filed sworn affidavit of Respondent No-2 by way of examination-in-chief as RW-2. On behalf of complainant (7) documents were got marked as Ex.P-1 to Ex.P-7. On behalf of Respondent No-1 (3) documents at Ex.R-1 to Ex.R-3 were got marked. The Respondent No-2 has not produced any document to be marked. 5. Heard the arguments of both sides and perused the records. The following points arise for our consideration and determination: 1.Whether the complainant proves deficiency in service by the Respondents, as alleged. 2.Whether the complainant is entitled for the reliefs sought for. 6. Our finding on the above points are as under:- 1. In the affirmative. 2. As per final order for the following REASONS POINT NO.1:- 7. There is no dispute that late Shivalingappa was an employee working under Respondent NO-2 and he had taken Insurance Policy in-question under Salary Saving Scheme and this Shivalingappa died on 11-06-06 and that the present complainant is the nominee of the life assured. The complainant has produced Insurance Policy Bond at Ex.P-1. It shows the insurance policy was taken on 21-08-01 premium payable was Rs,. 152/- p.m. Sum assured is Rs. 25,000/-. The Insurance Company/Respondent No-1 in the written statement has contended that the claim of the complainant was repudiated as the said policy was having so many gaps as under: 1) Gaps (9) From October 2001 to June-2002. 2) Gaps (5) From September 2004 to January-2005. 3) Gaps (15) From March 2005 to May-2006. Total 29 Gaps 8. Respondent NO-2 Hutti Gold Mines in their written version have stated that they have regularly remitted the premium of employee-late Shivalingappa to the LIC whenever his wages were sufficient. Thereafter due to non-availability of sufficient wages of the said Shivalingappa to pay the premium, the premium could not be remitted to the LIC and this fact was being regularly informed to late Shivalingappa and he had also knowledge of non-payment of premium when he took his monthly wage slip. Except this bare contention the Respondent No-2 has not produced any scrap of paper to substantiate that the non-deduction of the premium amount due to insufficient salary has been made known to the policyholder/their employee. What prevented Respondent NO-2 Company from producing the same is not forth coming. In the absence of the same it cannot be said that the non-deduction of the premium amount has been made known to the employee policyholder. 9. As stated above the Respondent No-1 Corporation in the written version have contended that they have repudiated the claim as the said policy was having so many gaps as shown in the table in the written version. From the gaps as shown in the table it shows that there are in all (29) gaps. The First gap comprises (9) months from October 2001 to June 2002, Second gap consisting of (5) months from September-2004 to January-2005. The Third gap comprise of (15) months from March 2005 to May 2006. It further shows that after the expiry of the first gap of (9) months viz., June-2002, the Respondent Company has received the policy premium from July 2002 till August 2004. Similarly after the expiry of 2nd gap period of (5) months viz., January-2005, they have received the premium amount for February 2005. The 3rd gap starts from March 2005 to May-2006. However the Pay slip at Ex.P-7 produced by the complainant shows deduction of LIC premium of Rs. 770.91 Ps from the salary for the month of May-2006. This means premium for May-2006 has been remitted/deducted from the salary of life assured, then the 3rd gap showing non-payment of premium for May-2006 is not correct. Further it appears that the Respondent Insurance Company have accepted the subsequent premium amount after the expiry of the gaps period. No explanation is coming forth as to why they have accepted the premium for the subsequent months after the expiry of gap period. Even there is no whisper as to whether they have accepted the subsequent premium by way of revival of policy (due to non-payment of premium for the gaps period). Even there is no whisper or any material coming forth on behalf of Respondent NO-1 Corporation that they had made any correspondence to Employer/Respondent No-2 or to the employee/policyholder with regard to non-payment of premium amount during gap period or after expiry of gap period. Similarly there is no whisper in the written version of Respondent NO-2 the Employer that they had made correspondence with Respondent No-1 Corporation regarding non-deduction/remittance of policy premium of life assured due to insufficient of salary amount of insured as per the Payment of Wages Act as contended by them. This shows shirking of the responsibility on the part of the Respondent No-2. Had Respondent No-2 intimated either to Respondent No-1 or to employee-late life assured regarding non-deduction/remittance of premium amount on the ground of priority basis and for insufficient salary amount then the Respondent No-1 Corporation could have cautioned the life assurant from lapsing of the policy and that the life assured too could have directly paid the premium amount by avoid lapsing of the policy. 10. As seen from the written version of the Respondent No-1, the act of Respondent No-1 in accepting the premium amount of subsequent months after expiry of gap period of non-payment of the premium, itself shows that the Respondent No-1 have soumoto revived the policy of the life assured. Because when according to the Respondent No-1, there was no payment of premium either by Respondent No-2 from salary deduction or directly paid by the life assured for the (9) months gap period i.e, from October-2001 to June-2002, then they ought not to have accepted the premium amount for July-2002 till the 2nd gap period of (5) months (from September-2004 to January-2005). When the Respondent No-1 accepted the premium amount for subsequent period from July-2002 to August-2004 for more than (2) years, then how the Respondent No-1 would say that the policy is in lapsed condition for non-payment of premium for the gap period. It appears that the Respondent Corporation without making correspondence either with Respondent No-2 or with the life assured for non remittance of premium amount for gaps period and having blindly accepted the premium amount for the subsequent period after the expiry of the gap period, now after the death of the policyholder when the complainant nominee claimed the policy amount they have repudiated her claim by giving dead-reason that the policy is in lapsed condition which is against their own acts and lacunas as stated earlier. When according to them policy is to be lapsed for non-payment of premium, then this principle would have applied for the First gap period of (9) months and they ought not to have accepted the premium amount for subsequent period from July 2002 onwards. When they have let loosed by giving life to the policy then how they could say now that the policy is in lapsed condition. Hence from the above discussion it goes without any hesitation that both the Respondents 1 & 2 are deficient and negligent in their service. This our view is supported by the decision of Honble Supreme Court reported in 2006(1) Civil LJ Page No-1 (Chairman Life Insurance Corporation and others V/s. Rajiv Kumar Bhasker) Head Note which interalia reads as under:- ....employers being agents of insurer-Corporation not entitled to be discharged from contractual obligations on default on the part of employer-Employees not informed about consequences of non-payment of premium both by employer and Corporatin-Therefore, judgements fixing liability on the Corporation needed no interference. In this background the attitude of the Respondents No-1 in not settling the claim of the complainant itself amounts to deficiency in service. Hence we hold that the complainant has proved deficiency in service. So Point NO-1 is answered in the affirmative. POINT NO.2:- 11. The complainant has sought for direction for awarding policy amount of Rs. 25,000/- with accrued benefits thereon and for awarding Rs. 10,000/- towards compensation damages and cost. So far as the 1st part of relief is concerned, the complainant is entitled for policy amount of Rs. 25,000/- with maturity benefits thereon from Respondent No-1. So far as the 2nd part relief of awarding Rs. 10,000/- towards damages and cost, we hold that having regard to the facts and circumstances of the case the ends of justice would be met by awarding Rs. 3,000/- under all heads. In this view of the matter we pass the following order: ORDER The complaint of the complainant is allowed in part. The Respondent No-1 Insurance Company is directed to pay the policy amount to the complainant together with bonus and other maturity benefits along with Rs. 3,000/- towards damages and cost of litigation. The Respondent No-1 shall comply this order within a period of (6) weeks from the date of receipt of copy of this order. Office to furnish certified copy of this order to both the parties forth with free of cost. (Dictated to the Stenographer, typed, corrected and then pronounced in the open Forum on 30-07-08) Sd/- Sd/- Sd/- Smt.Pratibha Rani Hiremath, Sri. Gururaj Sri. N.H. Savalagi, Member. Member. President, Dist.Forum-Raichur. Dist-Forum-Raichur Dist-Forum-Raichur.