Date of filing:16-03-2012

Date of Disposal: 01-05-2014

                                      DISTRICT CONSUMER DISPUTES REDRESSAL FORUM: ANANTHAPURAMU

                                                   PRESENT:- Sri S.Niranjan Babu, B.A.,B.L., President (FAC).

                                                             Smt.M.Sreelatha, B.A., B.L., Lady Member

                                                  Thursday, the 1^st  day of May, 2014

                                                                C.C.NO.16/2012

Between:

          P.Venkatarami Reddy

          S/o P.Chinna Venkata Reddy

          r/o B.Kothapalli Village

          Bukkaraysamudram Mandal

          Ananthapuramu District.                                                        ….   Complainant

Vs.

1.   The Branch Manager,

MAX Newyork Life Insurance Co. Ltd.,

Behind Meda Petrol Bunk,

Subash Road,

Ananthapuramu – 515 001.

1.    M/s Nirmal Chhaya Insurance Services Ltd.,

Regional Office, Adil Complex, 1^st floor,

51/1F & 1F1, Bellary Road

1.    The Manager,

MAX Newyork Life Insurance Co. Ltd.,

Regd. Office, Max House, 3^rd floor,

1 Dr.Jha Marg, Okhla

New Delhi – 110 020.,

1.    Smt.B.Subbamma

W/o Narayana Swamy

Agent, Max Newyor Life Insurance Co. Ltd.,

r/o B.Kothapalli Village,

Bukkarayasamudram Mandal

Ananthapuramu District.…..Opposite Parties

            This case coming on this day for final hearing before us in the presence of                           Sri A.Rami Reddy & Sri G.Ramakishore Reddy, Advocates for the complainant and                    Sri N.U.Devanatha Reddy, Advocate for the opposite parties 1 & 3, the opposite party No.2 is called absent and set-exparte and Sri N.P.Sreenivasulu, Advocate for the opposite party No.4 and after perusing the material papers on record and after hearing the arguments on both sides, the Forum delivered the following:

O R D E R

Smt.M.Sreelatha, Lady Member:- This complaint has been filed by the complainant under section 12 of the Consumer Protection Act, 1986 against the opposite parties                            1 to 4  claiming refund of Rs.16,960/- towards 1^st annual premium, Rs.15,160/- towards 2^nd annual premium, Rs.13,360/- towards 3^rd annual premium, Rs.30,000/- towards mental agony and deficiency of service and Rs.10,000/- towards costs of the complaint in total a sum of Rs.85,480/- with future interest @ 18% p.a. till the date of realization.

2.  The brief facts of the complaint are that :-The complainant is the permanent resident of B.Kothapalli Village, Bukkarayasamudram Mandal, Ananthapuramu District and he lives by doing cultivation. He is an uneducated person. The 1^st opposite party is Branch Office, 2^nd opposite party is Regional Office and 3^rd opposite party is Registered office of Max Newyork Life Insurance Co. and the said company is having different branches in India. The 4^th opposite party is agent of the said Insurance Company and native of complainant’s Village insisted the complainant to take Insurance Policy from the                     1^st opposite party.  The complainant has taken Insurance Policy bearing No.477719959 in the month of April, 2008 from the 1^st opposite party by paying 1^st annual premium of Rs.10,000/-.   The name of the policy is Life Maker Platinum, sum assured Rs.2,28,363/-, maturity date is 29-04-2033 and Annual Premium of Rs.10,000/-.  The complainant has paid 2^nd annual premium of Rs.10,000/- in April, 2009 and 3^rd annual premium in April 2010 to the 1^st opposite party and in total a sum of Rs.30,000/- paid by the complainant to the 1^st opposite party.  The 2^nd opposite party has issued premium paid certificate for the period 29-04-2008 to 03-01-2012 in favour of the complainant.   While so, the complainant approached the 1^st opposite party for paying 4^th annual premium of Rs.10,000/- at that time the staff of 1^st opposite party informed him that he has already surrendered the Insurance Policy and they have also sent the amount to the complainant’s Bank.  The complainant shocked and stated that he never surrendered the Insurance Policy to the 1^st opposite party and he has also no Bank account.  Since the                         1^st opposite party did not give proper reply, the complainant gave representation on                                    09-11-2011 to the 1^st opposite party and requested them to make enquiry into the matter and do the needful for which the 1^st opposite party neither took any action nor gave any reply to the complainant.  Vexed with the attitude of the opposite parties, the complainant got issued legal notice on 16-01-2012 to the opposite parties 1 to 4 in which he has clearly stated that the staff of 1^st opposite party colluded with other opposite parties and misappropriated the amount of the complainant.  The opposite parties 1 & 2 received notice and signed the postal acknowledgment, notice sent to the 3^rd opposite party not returned and 4^th opposite party managed to return the said notice.  Though the opposite parties 1 & 2 received the said notice, they did not give any reply.  The complainant suffered lot of mental agony due to inadvertent attitude of the opposite parties.  Hence there is gross negligence and deficiency of service on the part of the opposite parties                       1 to 4 and they are jointly and severally liable to pay compensation to the complainant.

3.   Counter filed on behalf of the opposite parties 1 & 3 stating that the complainant has taken policy only after understanding the contents of the same and the purpose of the complainant was to insure his life as well as make some investment.  On 10-05-2011 the complainant submitted a surrender request, Nationalized Electronic Fund Transfer – Mandate Form and Vernacular declaration and the same was duly signed by the complainant along-with vernacular declaration, which shows that the complainant has submitted surrender request after understanding the contents of the same.  In response to the surrender request, a reply was sent to the complainant that the opposite parties have received request for surrender of the policy and the same will be processed as per his request.  The request of the complainant was processed and the same was informed vide letter dt.12-05-2011 that the opposite party has transferred an amount of Rs.20,423.47 to his Bank.  They have also stated that details provided in the mandate form for the NEFT under the Insurance Policy are presumed to be true, correct and accurate and he shall be liable to indemnify the Insurance Company for any loss, claim or damage arising on account of any error in the mandate form. The opposite parties denied the contents made in para 5 of the complaint.  They have also stated that the notice was full with false, concocted and baseless allegation.  A reply dated 23-03-2012  was sent to the complainant stating that the policy cannot be cancelled now as the free look period has expired.  As the complainant did not mention anything regarding the surrender request in his notice, it was erroneously informed to him that in case the policy has been terminated and received the amount, then has an option to reinstate the same.  This was an inadvertent error which is attributable to the complainant. No cause of action exist for filing the present complaint as there is no deficiency of service on the part of the opposite party.  As per definition under section 2(g) of the Consumer Protection Act, 1986  deficiency of service means  “any fault, imperfection, shortcoming or inadequacy in the quality, nature and manner of performance which is required to be maintained by or under any law for the time being in force or has been undertaken to be performed by a person in pursuance of a contract or other-wise in relation to any service. “  There is no such fault, imperfection, shortcoming or inadequacy in the nature and manner of performance of service by the opposite party.  Thus no liability arises since the surrender value was paid to the complainant as per the terms and conditions of the policy contract.  Therefore the complainant is not entitled to the compensation alongwith interest as claimed by him.

4.         The 2^nd opposite party is called absent and set-exparte.

5.         Counter filed on behalf of the 4^th opposite party stating that the complainant has taken insurance policy from the 1^st opposite party through this opposite party. This opposite party is not known about the yearly installments paid by the complainant.  This opposite party is also not known about  the complainant approached the 1^st opposite party for paying 4^th installment amount and at that time the 1^st opposite party staff  informed the complainant already surrendered the policy and they have sent the amount to the complainant’s Bank.  This opposite party is not known about the complainant shocked and stated to the staff that he never surrendered the policy to the 1^st opposite party and he has no Bank account.  This opposite party is not known about the representation given by the complainant on 09-11-2011 to the 1^st opposite party requesting them to make enquiry into the matter.  The allegation made in para 5 that the complainant got issued legal notice on 16-01-2011 to the opposite parties 1 to 4 and this opposite party got managed and returned the notice is not true.   This opposite party does not know what happened between the complainant and 1^st opposite party and after receiving notice only she knew the facts.  This opposite party is an agent and she collected 1^st installment premium amount and the same is paying to the 1^st opposite party.  After that this opposite party has no involvement in office work.  The complainant never approached this opposite party though residing in the same Village and never discussed about the policy.  Hence this opposite party is no way concerned and unnecessarily added as a party and prays this Forum to dismiss the complaint against this opposite party.

6.         Basing on the above pleadings, the points that arise for consideration are:-

          1. Whether there is any deficiency of service on the part of the opposite

              parties 1 to 4?

         2. To what relief?

7.         In order to prove the case of the complainant, the complainant has filed evidence on affidavit on his behalf and marked Ex.A1 to A48 documents.  The complainant has examined the Officer of Indian Overseas Bank, Ananthapurmu as PW1 and marked Ex.C1 to C3. On behalf of the opposite parties 1 & 3, evidence on affidavit of the opposite parties 1 & 3 has been filed and marked Ex.B1 to B4 documents. On behalf of 4^th opposite party, evidence on affidavit of 4^th opposite party has been filed and no documents marked.

8.  Heard on both sides.

9.      POINT NO.1:-   The counsel for the complainant argued that the complainant has taken Insurance Policy from the 1^st opposite party and the opposite parties 2 & 3 are Head Offices of the above said company and 4^th opposite party is agent of opposite parties                       1 to 3.  The 4^th opposite party is a native Village of the complainant and she insisted to take Insurance Policy from the 1^st opposite party by the complainant.  Accordingly, the complainant has taken policy from the 1^st opposite party in the month of April, 2008 by paying a sum of Rs.10,000/- and the opposite party also issued policy No.477719959 the sum assured Rs.2,28,363 and maturity date is 29-04-2033 and annual premium of Rs.10,000/-.  After taking policy, the complainant paid 2 & 3 annual premiums in the months of April, 2009 and 2010 respectively.  The 2^nd opposite party has issued premium paid certificate for the same.  Counsel for the complainant argued that when the complainant approached the 1^st opposite party for paying 4^th annual premium of Rs.10,000/-, the staff of the 1^st opposite party informed that he has already  surrendered the policy and they have sent the amount to the complainant’s Bank Account.   The complainant shocked and he informed that he is has not surrendered his policy and he has no Bank Account by stating the same he gave representation on 09-11-2011 requesting the opposite party to make enquiry and do the needful.  But the 1^st opposite party has not taken any action nor gave any reply.  Then, the complainant got issued legal notice on 16-01-2012 to the opposite parties 1 to 4 to pay total premium amount of Rs.30,000/- with interest @ 18% p.a. from the date of payment and the same was served to the opposite parties 1 & 2 and returned by opposite parties 3 & 4.  Hence the complainant suffered lot of mental agony due to inadvertent attitude of the opposite parties.  It clearly shows that there is gross negligence and deficiency of services on the part of the opposite parties and opposite parties 1 to 4 are jointly and severally liable to pay compensation.  The counsel for the opposite party filed counter denying the allegations made in the complainant.  The opposite party filed counter stating that policy was taken by the complainant only after understanding the contents of the same then only the opposite party was insured his life.  The opposite party also stated that on                        10-05-2011 the complainant submitted surrender request, Nationalized Electronic Fund Transfer – Mandate form and vernacular declaration.  It is submitted that the written surrender request was duly signed by the complainant along-with vernacular declaration, which shows that the complainant submitted surrender request after understanding the contents.  In response to the surrender request a reply was sent to the customer stating that the opposite parties have received request for surrender of the policy and it was further stated that the same will be processed.  The request of the complainant was processed, it was informed vide letter dt.12-05-2011.  The opposite party has transferred the amount of Rs.20,423.47 to the complainant’s account.  The opposite party also contended that the details furnished in the mandate form in the NEFT under the insurance policy are presumed to be true and correct.  The opposite party also contended that except receiving legal notice, the complainant did not mention anything regarding not surrendering of policy in his notice, it was erroneously informed to him that in case the policy has been terminated and he has received the amount then he has option to reinstate the same. The opposite party also contended that there is no deficiency of service on the part of the opposite party as per section 2(g) of Consumer Protection Act.  The complainant has violated the terms and conditions of the contract and hence the complainant is not entitled any amount as claimed towards compensation.

10.       It is an admitted fact that the complainant has taken insurance policy from the                    1^st opposite party in the month of April, 2008 and he used to pay premiums regularly till 2011.  The present complaint came arose when the complainant approached the                              1^st opposite party to pay 4^th annual premium in the month of April, 2011.  Then the staff of the 1^st opposite party informed that the amount was withdrawn by the complainant.  The complainant claims that original policy is still with him and surrender of policy with opposite party or withdrawal of amount does not arise.  The counsel for the opposite party argued that the complainant made request under Ex.B3 that he intended to surrender the policy by furnishing Bank Account on 09-05-2011 under Ex.B4, by furnishing account with Indian Overseas Bank and the same was transferred to his account.  When we go-through Ex.B3 and B4 filed by the opposite party and in Ex.B3 name of the policyholder and in the proposal form under Ex.B1 and also in Ex.A2 is one and the same.  Whereas the signature of alleged request of the complainant does not tally with the signature on the proposal form.  In the proposal form under Ex.B1 and Ex.A2 the signature of the complainant is in Telugu, whereas in Ex.B3 request to surrender policy is in English and the same was strike out and made in Telugu.  Even this is not tallied with the signature on proposal form. This raises curtain for doubt and Ex.B4 along-with alleged policy surrender of original policy.  The complainant stated that original policy is with him and the same was filed before this Forum under Ex.A8.  Hence the question of surrendering the policy to the opposite party as alleged in the counter and affidavit does not arise. The opposite party did not file original policy except request in Ex.B4.  If the averments in Ex.B4 is correct, then the opposite party has to file original policy.  On the other hand the complainant states that original policy filed into the court.  Ex.A8 i.e. original policy was not challenged by the opposite party.  It is not the case of the opposite party that the duplicate policy bond was issued in the place of original bond and that the duplicate was submitted for withdrawal of amount.  No recital in the counter or in the affidavit about the issuance of duplicate policy. Usually when the duplicate bond has to be issued, the company will issue the same only after filing indemnity bond, for the same there are no such elements in this case and hence the claim of the complainant has to be considered.  Hence the submission of policy to the opposite party as alleged in the counter is not established.   The case of the opposite party is that after surrendering the policy, they transferred the amount to Bank Account Number furnished by the complainant, for the same they have not taken any form.  The opposite party also contended that the amount was withdrawn by the complainant after transferring the amount to his account, whereas the complainant stated that he is not having any Bank Account with Indian Overseas Bank.  The counsel for the complainant argued that when the complainant approached the staff of 1^st opposite party to pay 4^th premium, then only he came to know that the amount was withdrawn.  To prove his case that he has not withdrawn the amount as alleged by the opposite party, he examined the Bank Officer of Indian Overseas Bank.  The officer admitted that the person in the application form who is having account with the Bank and the person who was present in the Forum i.e. complainant is not one and the same.  The documents brought by the Manager clearly shows that the account is not pertaining to the complainant.  The Photograph of the account-holder is also proves the same. The officer stated that the alleged account was opened by one P.Venkatarami Reddy in the year 2010.  The Bank Manager also brought I.D. proof of accountholder and ration card and the same was marked as Ex.C1 to C3. Ex.C1 to C3 are also not tallying with the photograph in the proposal form. The opposite party fails to establish that the amount is paid to the complainant to the said account also.  Under these circumstances, this Forum found it serious for making vehement efforts to establish wrongful transaction as genuine and tried to loss the poor, illiterate and rural policyholders like the complainant. In this case, the opposite party ought to have considered the request made by the complainant under Ex.A3 atleast when the complainant stated that he has not surrendered the policy and he is not having any account with Indian Overseas Bank, the opposite party ought to have investigated about the transfer of amount made with due diligence by their staff.  It is seriously surprised to understand that the complainant never made any request to the opposite party for closure of the policy. More-over the complainant went to the 1^st opposite party office to pay premium shows that he has intention to continue the policy.  The opposite party gets letter for surrender of policy and how the amount is paid without policy bond or indemnity bond is a million dollar question to be answered by the opposite party.  It is the interest of the opposite party company and public at large who relies on the privity of the company.  The opposite party simply stated that after admitting the contents in the policy, the complainant surrendered the policy, the question of paying premium does not arise because section 2(g) of Consumer Protection Act there is no such fault, imperfection, shortcoming or inadequacy in the quality, nature and manner of performance which is required to be maintained by or under any law. For this also the opposite party failed to prove that there is no fault on the part of the opposite parties in service.  Whereas the action is necessary to check such fraudulent transaction by mischief for wrongful gain at the cost of the poor people hard earned money.  This Forum viewed that it is a very a serious negligence on the part of the opposite parties and deserves exorbitant penalty for their mischief.  This Forum deserves that there is no reconciliation or subsequent action by the opposite parties after filing this complaint to check whether they made wrong but tried to stipulate their negligence and deficiency of service with vehement contents.  The complainant being poor and illiterate apart from that rural back ground made hectic efforts to prove his case and the opposite parties became failed in legal fight.  The opposite party submitted ruling reported in AIR 2000 SC  page 10 wherein it was observed that “ The Insurance Policy has to be construed having reference only to the stipulations contained in it and no artificial farfetched meaning could be given to the words appearing in it. “  The counsel for the opposite parties submitted another ruling reported in AIR 2005 SC 286 that “ The terms of the contract have to be construed strictly without altering the nature of contract as it may affect the interest of parties adversely. :” The above said citations are not applicable to the present case. Hence, we have not considered the above citations submitted by the opposite parties.  We are of the opinion that it is a clear case of negligence on the part of the opposite parties 1 to 3 and opposite parties failed to take reasonable care at the time of transferring the amount to a wrong person.  They have not even verified while transferring the amount whether the person who alleged to have requested to surrender the policy is the original policyholder.  The opposite parties totally failed in doing services to the complainant.    Hence, this point is answered accordingly in favour of the complainant and against the opposite parties 1 to 3.

11.       POINT NO.2 – In the result the complaint is allowed by directing the opposite parties 1 to 3 to pay a sum of Rs.30,000/- paid by the complainant towards premiums with interest @ 18% p.a. from the date of policy i.e. 2008 till the date of realization.  The complainant is also entitled a sum of Rs.10,000/- towards mental agony  and a sum of Rs.5,000/- towards deficiency of service from the opposite parties 1 to 3 and the opposite parties 1 to 3 are jointly and severally liable to pay the same to the complainant within one month from the date of this order. The complaint against the opposite party No.4 is dismissed as she is agent of the opposite parties 1 to 3 and she discharged her duty by joining the complainant into policy with the 1^st opposite party.

Dictated to Steno, transcribed by him, corrected and pronounced by us in open Forum this the 1^st day of May, 2014.

                        Sd/-                                                                          Sd/-

               LADY MEMBER,                                                  PRESIDENT(FAC),

DISTRICT CONSUMER FORUM,                         DISTRICT CONSUMER FORUM,

             ANANTHAPURAMU                                              ANANTHAPURAMU

APPENDIX OF EVIDENCE

WITNESSES EXAMINED

ON BEHALF OF THE COMPLAINANT:              ON BEHALF OF THE OPPOSITE PARTIES

1. PW1 – Sri J.Jayaprakash, Senior Manager,                                          - NIL-

                Indian Overseas Bank, Ananthapuramu

                On 04-07-2013.

EXHIBITS MARKED ON BEHALF OF THE COMPLAINANT

Ex.A1  -  Premium Paid Certificate for the period 29-04-2008 to 03-01-2012 issued by the 2^nd

              opposite party to the complainant.

Ex.A2  -  Photo copy of Unit Linked Proposal Form submitted by the complainant to the 1^st

               opposite party.

Ex.A3  -  Photo copy of representation dt.09-11-2011 given by the complainant to the 1^st

               opposite party.

Ex.A4 -   Office copy of legal notice dt.16-01-2012 got issued by the complainant to the

               Opposite parties 1 to 4.

Ex.A5  - Postal acknowledgment signed by the 1^st opposite party.

Ex.A6 – Postal acknowledgment signed by the 2^nd opposite party.

Ex.A7-  Returned postal cover addressed to the 4^th opposite party.

Ex.A8 -  Original Insurance Policy bearing No.477719959 issued by the 1^st opposite party in

              favour of the complainant.

EXHIBITS MARKED ON BEHALF OF THE OPPOSITE PARTIES 1 & 3

Ex.B1 – Photo copy of Unit Linked Proposal Form submitted by the complainant to the 1^st

             opposite party.

Ex.B2 – Photo copy of letter dt.02-05-2008 issued by the opposite parties to the complainant.

Ex.B3 – Photo copy of Nationalized Electronic Funds Transfer Mandate Form.

Ex.B4 -  Photo copy of letter dt.12-05-0211 relating to surrender of policy issued by the opposite

              parties to the complainant.

EXHIBITS MARKED ON BEHALF OF THIS FORUM

Ex.C1 – Photo copy of Account Opening Form dt.11-05-2010 by one Podaralla Venkatarami

              Reddy.

Ex.C2 – Photo copy of Voters Identity Card relating to Podaralla Venkatarami Reddy.

Ex.C3 –Statement of Account relating to Podaralla Venkatarami Reddy issued by Indian

             Overseas Bank, Ananthapuramu.

                         Sd/-                                                                                       Sd/-     

               LADY MEMBER,                                                   PRESIDENT(FAC),

DISTRICT CONSUMER FORUM,                         DISTRICT CONSUMER FORUM,

             ANANTHAPURAMU                                              ANANTHAPURAMU

Typed by JPNN