Complaint is filed on 18-03-2009

                                                                                                                            Compliant disposed on 26-03-2010

BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM::AT:: K A R I M N A G A R

PRESENT: HON’BLE SRI K. DEVI PRASAD, B.Sc., LL.B., PRESIDENT

AND

SMT. E. LAXMI, M.A.LL.M.,PGDCA (CONSUMER AWARENESS), MEMBER

FRIDAY, THE TWENTYSIXTH DAY OF MARCH,

TWO THOUSAND TEN

CONSUMER COMPLAINT  NO.  54 OF  2009

Between: 

Mididoddi Ellamma, W/o. Late Mididoddi Rajaiah, Age 48 years, Occ: Housewife, N.T.R. Nagar, Godavarikhani mandal of Ramagundam, district Karimnagar.

                                                                                                                             … Complainant

                                 AND

Life Insurance Corporation of India, Ramagundam branch, NTPC “X” Roads, Jyothinagar, Ramagundam proper and mandal, district Karimnagar R/by it’s Manager.

                                                                                                …Opposite Party

This complaint is coming up before us for final hearing on 5-3-2010, in the presence of Sri B.Srinivas and Smt. B. Geetharani, Advocates for complainant, and Sri P. Ashok, Advocate for opposite party, and on perusing the material papers on record, and having stood over for consideration this day, the Forum passed the following:

:: ORDER::

1.       This complaint is filed under Section 12 of C.P. Act., 1986 praying this Forum to direct the opposite party to pay Rs.1,45,000/- with interest, damages and costs.

 2.       The brief averments of the complaint are that the complainant is the wife and nominee of Late Mididoddi Rajaiah who was an employee in Singareni Collaries Company Limited. During his life time he obtained several Insurance Policies

 with opposite party, paying premium by way of salary deduction.  Unfortunately, the policy holder died on 25.3.2004 due to hear attack. As per the norms of policy in case of death of the policy holder the nominee will get sum assured with bonus and benefits. After the death of the policy holder the complainant informed the opposite party with all relevant documents and requested to settle the claim within one month. But the opposite party did not settle the claim and postponing the same on one pretext or other. Vexed with the attitude of the opposite party, the complainant got issued Legal Notice on 12.2.2009 through her advocate, and the same was served on opposite party. But there is no response from the opposite party, hence this complaint. 

3.       Opposite party filed his counter denying the averments made in the complaint and admitted the issuance of Endowment Assurance Policy with Profits. The above said policies were in lapsed condition as on the date of death of the life assured. And further stated that they have received the monthly premiums upto March 2003, further premiums were not received from April 2003. Hence the policy did not acquire any paid up value. Therefore, as per the policy conditions nothing is payable under the policy. There was neither delay nor deficiency of service on their part. Hence, prayed to dismiss the complaint with costs.

4.       Both the parties have filed their Proof Affidavits The documents filed by the complainant are marked as Ex.A1 to A15 and the opposite party did not chose to file the documents.

5.       The point for consideration is whether there is any deficiency of service on the part of opposite party, if so , to what relief the complainant is entitled?

6.       Ex.A1 to A6 are the Xerox copies of policies. Ex.A7 to A12 are the Xerox copies of Status Reports. Ex.A13 is the copy of Death Certificate issued by Registrar of Births 7 Deaths, Ramagundam Municipality, Karimnagar district Dt: 26.4.2004. Ex.A14 is the office copy of Legal Notice got issued by counsel for complainant Dt: 12.2.2009. Ex.A15 is the Courier receipt served on opposite party Dt: 13.2.2009.

7.       The policy holder i.e. deceased was the employee of Singareni Collaries, Godavarikhani. The complainant claimed the assured amount by issuing the Legal Notice to opposite party on the ground that her husband, Vaidya Srihari died on 25.3.2004 and requested to settle the death claim on the two policies. This claim of complainant is admitted by the opposite party. But the opposite party contends that the policies were in lapsed condition at the time of death of policy holder. Therefore, as on the date of death of life assured since one policy was lapsed there is no need to pay any amount under the policy. It is clear from the counter and also the Proof Affidavit filed by the opposite party that they have received premiums upto March 2003 and further premium from April 2003 were not received. This is only the contention that has been raised by the learned counsel for the opposite party.

8.       In support of their contention the learned counsel for complainant cited authorities that,

(i)       2009 (2) CPR 85 (NC) in a case Branch Manager & Anr Vs Smt. A.Yasodamma & Anr, wherein it is held that “Neither employer nor petitioner had informed insured about non-payment of premium-Employer and insurance Company were bound to inform insured of consequence of non-payment of premium-No reason on ground to interfere-” 

(ii).     2009(2) CPR 143 (NC) in a case Life Insurance Corporation of India Vs Smt. Ranjana Misra & Ors, wherein it is held that “Where premium for LIC policy was to be remitted from salary and failure in remittance was for no fault of insured and employer was liable for that fault, employer being agent of LIC, Corporation was liable to pay policy amount”.       

(iii)     2009 (3) CPR 102 (J&K) in a case United Insurance Co., Ltd. & Anr Vs Raj Nath Mantoo and Anr, wherein it is held that “Cause of action in a claim under Insurance policy would arise only when insured’s claim was repudiated and not earlier thereto”.

9.       In the Proof Affidavit of the complainant, the averments made in the counter filed by the opposite party were denied totally by the complainant and the complainant counsel contends that it is the duty of the Salary Disbursing Officer to deduct the amount towards policy premium and send the same to the Insurance Company. There is an agreement between the employer, Singareni Company and the Insurance Company that the monthly premium will deduct from the salary of the employee and sent to the Insurance Company. Therefore, the contract is between the employer and Insurance Company, but not between the employee and Insurance Company. Further, it is contended that even if assuming for a moment, the opposite party did not receive the monthly premiums, there is no notice issued to the employee to pay the defaulted premiums. Therefore, there was no possibility for the employee or life assured to know about defaulted premiums unless and until the same is informed to the life assured.

10.     With regard to the limitation it is clear that notice is issued by the complainant on 12.2.2009 to the Insurance Corporation claiming payment of assured amount with interest and also costs. The same was received by the LIC of India which is evidenced under Ex.A15. The opposite party though filed some documents to show that the life assured have taken policy and failed to file the reply notice nor any information repudiating the claim of the complainant. Therefore, in view of the above said authority of Jammu and Kashmir State Commission the limitation starts from the date of repudiation and in this case as there is no repudiation the question of filing the complaint beyond the limitation does not arise.   

11.     With regard to the claim of the complainant as contended by the learned counsel for the complainant when there is an agreement between the employer and LIC to pay the premium by deducting from the monthly salary of the life assured since the premiums were not received by the Insurance Company, the Insurance Company ought to have issued notice to the employee i.e. life assured to pay the defaulted premiums or the employer i.e. Singareni Company would have issued notice to the life assured to pay the defaulted amount. But there are no documents filed by the opposite party to show that neither the Insurance Company issued any notice to the life assured nor they have issued any notice asking the life assured to pay the defaulted premiums. As per the reported judgment in New India Assurance Co., Ltd Vs Ram Dayal & Ors, 1990 (20 ACJ 545 SC, wherein it is held that “Prompt settlement was part of service. Delay in settlement would amount to deficiency in service”. In the above said authorities opposite party was directed to deduct the amount which was found default. But this case is quiet different from the cited authority as the life assured is no more alive.

12.     In the result the complaint is allowed directing opposite party to pay Rs.1,45,000/- with 9% interest per annum from the date of filing the complaint i.e. 17.3.2009 and costs of Rs.1,000/- within one month from the date of receipt of this order.

          Dictated to Stenographer and transcribed by her, after correction the orders pronounced by us in the open court this the 26^th day of March, 2010.

           Sd/-                                                               Sd/-                                                           Sd/-

      MEMBER                                                     MEMBER                                                    PRESIDENT

NO ORAL EVIDENCE HAS BEEN ADDUCED ON EITHER SIDE

FOR COMPLAINANT:

Ex.A1 to A6 are the Xerox copies of policies.

Ex.A7 to A12 are the Xerox copies of Status Reports.

Ex.A13 is the copy of Death Certificate issued by Registrar of Births 7

 Deaths, Ramagundam Municipality, Karimnagar district Dt: 26.4.2004.

Ex.A14 is the office copy of Legal Notice got issued by counsel for

            complainant Dt: 12.2.2009.

Ex.A15 is the Courier receipt served on opposite party Dt: 13.2.2009.

FOR OPPOSITE PARTY:           -NIL- 

           Sd/-                                                               Sd/-                                                           Sd/-

      MEMBER                                                     MEMBER                                                    PRESIDENT