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

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Complaint  Case No:  1353 of 2009

Date of Institution :  01.10.2009

Date of  Decision   :  16.03.2010

Gurmeet Singh son of Shri Munshi Singh, vPO Mullanpur Garibdass, Tehsil Kharar, District Mohali.

 ……Complainant

V E R S U S

(1)  The Manager, ICICI Prudential Life Insurance Company Ltd. Sector 9, Madhya Marg, Chandigarh.

(2)     Ashish Kumar, FSC Code No. 00117190, ICICI Prudential Life Insurance Company Ltd., Sector 9, Madhya Marg, Chandigarh.

(3)     Head, Prudential Life Insurance Company Ltd., ICICI Prulife Towers, 1089, Appasaheb Marathe Marg, Prabhadevi, Mumbai – 400025.

.…..Opposite Parties

CORAM:     SH.LAKSHMAN SHARMA              PRESIDENT

          SH.ASHOK RAJ BHANDARI       MEMBER

          MRS.MADHU MUTNEJA             MEMBER

PRESENT: Sh.R.P. Singh, Adv.for Complainant.

         Sh. K.S. Cheema, Adv. for OP Nos.1 & 3.

           OP No. 2 Ex-parte.

PER ASHOK RAJ BHANDARI, MEMBER

        Concisely put, Complainant had obtained a ‘Life Time Super Pension Policy’, bearing No. 07331817, from the OPs, on 11.01.2008, through their Authorized Agent namely – Ashish Kumar (FSC Code No. 00117190). Copy of the said Policy is at Annexure C-1. Since the payment of premium for the said Policy was to be paid on yearly basis, the next premium fell due on 11.01.2009 for the sum of Rs.25,000/-. The Complainant in all good faith and trusting the said Ashish Kumar, who was an approved Agent of the OPs, gave him a cash cheque drawn in the name of ‘Self’ on State Bank of India, Panjab University, Chandigarh Branch, for Rs.25,000/- on 06.01.2009. The Agent withdrew the amount from the Bank, but did not give any receipt to the Complainant. Accordingly, the Complainant went to the OPs on 21.4.2009, asking for the receipt for the money given by him to their Agent. But the Manager of the OP No.1, vide his letter dated 17.07.2009, informed the Complainant that since he does not have any evidence or receipt of having given the premium amount of Rs.25,000/- to the Agent of OPs to deposit the same towards the Policy, they are not able to comply with his complaint. In this backdrop, the Complainant got issued a legal notice to the OPs, but to no avail. Hence, this complaint, alleging that the aforesaid acts of the OPs amount to deficiency in service and unfair trade practice. In the end, the Complainant has prayed for the following reliefs:-

a)  OP No. 1 be directed to issue the receipt of Rs.25,000/- for which he has himself admitted to be paid the Company as the premium towards the policy in Annexure-6.

b)  To pay compensation of Rs.50,000/- on account of suffering, unnecessary harassment, mental agony, stress and strain and indulging in unfair trade practice. 

c)  To pay Rs.10,000/- as cost of litigation.

2]      Notice of the complaint was sent to OPs seeking their version of the case.  OP No.2 did not turn up despite due service of notice and also has not filed any written statement/reply. Therefore, he was proceeded against exparte. 

3]      OP Nos. 1 & 3 in their written statement, while admitting the factual matrix of the case/reply, pleaded that Complainant had taken a Life Time Super Pension Policy, bearing No. 07331817, on 11.1.2008, by paying a sum of Rs.25,000/- as the first premium with the provision that the subsequent premia were payable yearly @ Rs.25,000/- per year. It was asserted that there was no deficiency of service on their part, as issuance of a ‘Self’ cheque by the Complainant and drawing the amount from his account, cannot make the OPs liable to pay for the same. It was further pleaded that in case, the premium was paid by Cheque by the insured, it had to be drawn in favour of ICICI Prudential Life Insurance Company Ltd. and that in case of any cash deposit, it should be done at the authorized cash center, where a printed receipt is issued and that the same practice is followed by all Companies for all customers. It was submitted that as per Para 28 of the Proposal Form, filled in by the Complainant, any cash or cheque payment made towards the first or renewal premium was deemed to be received by ICICI Prudential Life Insurance Company Ltd. only, when the same had been received by any of its Offices or Collection Points, after an official printed receipt was issued by the Company.  It was also pleaded that it is a settled law that the Adviser is the Agent of the Life Assured and not the Agent of the Company and hence, the Company is not liable for any acts of the Adviser, as all these acts are done on behalf of the Life Assured. On these grounds, the OPs have emphatically stated that the present complaint may be dismissed. It was further submitted by the OPs that no doubt – Ashish Kumar was an approved and authorized Agent of the OPs at the time of issuance of Insurance Policy in the name of the Complainant, yet he was removed as an Agent later on. Therefore, on the date of issuance of cheque for renewal premium i.e. 6.1.2009, the said Ashish Kumar was no longer the authorized/approved Agent of the OPs and, therefore, as per the OPs, they are not liable for any acts of omission and commission of the said Agent – Ashish Kumar as on 06.01.2009.   All other material contentions of the Complainant were controverted. Pleading that there was no deficiency in service on their part, a prayer has been made for dismissal of the complaint with exemplary costs.

4]      Parties led evidence in support of their contentions.

5]      We have carefully gone through the entire case thoroughly, including the complaint and the relevant documents tendered by the complainant / OP Nos.1 & 3 (OP No. 2 being ex-parte). We also heard the arguments put forth by the learned counsels for the Complainant and OP No. 1 & 3. As a result of the detailed analysis of the entire case, the following points/issues have clearly emerged and certain conclusions/arrived at, accordingly:-

i]  The basic facts of the case in respect of the Complainant having obtained a ‘Life Time Super Pension Policy’, bearing No. 07331817, from the OPs on 11.01.2008, through the Authorized Agent of the OP namely – Ashish Kumar (FSC Code No. 00117190) and that the said Agent gave all the receipts, have all been admitted. The Policy is at Annexure C-1. Since the payment of premium for the said Policy was to be paid on yearly basis, the next premium fell due on 11.01.2009 for the sum of Rs.25,000/-. The Complainant in all good faith and trusting the said Ashish Kumar, who was an approved Agent of the OPs with a Code No. allotted to him by the OPs gave him a cash cheque drawn in the name of ‘Self’ on State Bank of India, Panjab University, Chandigarh Branch, for Rs.25,000/- on 06.01.2009. The Agent withdrew the amount from the Bank, but did not give any Insurance Company’s receipt to the Complainant. Thus, it also appears that the Agent did not deposit the said amount with the Insurance Company.

ii] The dispute between the parties i.e. the Complainant on the one hand and the OPs on the other arose only in respect of the payment of second installment of the premium; whereas, the contention of the Complainant is that the said Ashish Kumar was an authorized and approved Agent of the OPs and it was through him that he got the original Insurance Policy issued and also paid the first insurance premium of Rs.25,000/- and that everything went well at that stage, it was only at the stage of the payment of the second installment of the premium, that he took the cheque, got it encashed, but did not give any receipt for the same. Since the Agent did not give any receipt, the Complainant took the next logical step and went to the OPs on 21.4.2009, asking for the receipt for the money given by him to their Agent (Annexure C-6). But the Manager of the OP, vide his letter dated 17.07.2009, informed the Complainant that since he does not have any evidence or receipt of having given the premium amount of Rs.25,000/- to the Advisor/ Agent to deposit the same towards the Policy, they are not able to comply with his complaint. Subsequently, the Complainant got issued a legal notice to the OPs, but to no avail.

iii] The OPs, in their written statement/ reply took some preliminary objections to the complaint, stating that the Complainant is not a “Consumer” under Consumer Protection Act, 1986 and also that there is no deficiency of service on their part qua the Complainant; further, saying that the Complainant has not acted in good faith and that the issuance of a ‘Self’ cheque and the mere drawing the amount from the account cannot make the OPs liable to pay for the same. However, in its reply on merits, the OPs have admitted that the Complainant had taken a Life Time Super Pension Policy, bearing No. 07331817, on 11.1.2008, by paying a sum of Rs.25,000/- as the first premium with the provision that the subsequent premia were payable yearly @ Rs.25,000/- per year. The OPs further state that in case the premium is paid by Cheque by the insured, it has to be drawn in favour of ICICI Prudential Life Insurance Company Ltd. and that in case of any cash deposit, it should be done at the authorized cash center where a printed receipt is issued and that the same practice is followed by all Companies for all customers. The OPs further say that as per Para 28 of the Proposal Form filled in by the Complainant, it has been clearly stated that any cash or cheque payment made towards the first or renewal premium is deemed to be received by ICICI Prudential Life Insurance Company Ltd. only when the same has been received by any of its office or collection point, after an official printed receipt is issued by the Company. In view of this, it is quite clear that the life assured has acted against the rules and as of now, he cannot claim deficiency of service on the part of OPs. It is further emphasized by the OPs that the Proposal Form filled in and signed by the Complainant is not merely a formality, but it is the basis of the Contract of Insurance, as well as that it contains terms and conditions of the said Policy. It also provides information to the insurer to exercise its legal right. The OPs have further argued that it is a settled law that the Adviser is the Agent of the Life Assured and not the Agent of the Company and hence, the Company is not liable for any acts of the Adviser, as all these acts are done on behalf of the Life Assured. On these grounds, the OPs have emphatically stated that the present complaint may be dismissed.

iv] During the course of arguments, the learned counsel for the OPs has stated that they were not sure as to who in fact, went to the Bank and received the payment for the Cheque issued by the Complainant in favour of self. To this, the Complainant produced the complete photocopy of the Cheque, including obverse the reverse side of the Cheque. The reverse side of the Cheque contains the signatures of Ashish Kumar, who is admittedly an authorized/ approved Agent of the OPs. Therefore, there is no doubt as to who received the payment from the Bank on behalf of the Complainant.  It is quite another matter that the said Agent might not have deposited the impugned amount of the premium with the OPs and also not issued any receipt to the Complainant for receiving the Cheque in question for Rs.25,000/-.  So far as the issue of payment of premium in cash is concerned, as admitted by the OPs, it is allowed, subject to Company Rules. Another issue raised by the OPs during arguments was that no doubt – Ashish Kumar was an approved and authorized Agent of the OPs at the time of issuance of Insurance Policy in the name of the Complainant, yet he was removed as an Agent by the Complainant later on. Therefore, on the date of issuance of renewal premium cheque i.e. 6.1.2009, the said Ashish Kumar was no longer the authorized/approved Agent of the OPs and, therefore, as per the OPs, they are not liable for any acts of omission and commission of the said Agent – Ashish Kumar as on 06.01.2009.  

v]  The contention of the OPs in respect of the conduct of their Agent is just not tenable, as even as per their own admission, the said Ashish Kumar was appointed by the OPs and not by the Complainant as their authorized Agent and the present Insurance Policy of the Complainant was issued only through his agency and the OPs at that time had taken no objection whatsoever. It is also well known that it may not be possible for any customer or the person assured to keep track as to whether the Company has terminated the services of a particular Agent at any point of time. In the present case, the Complainant all along rightly believed that Ashish Kumar was the Agent of the OPs. Even on 6.1.2009, in any case, the OPs have failed to produce any document or supporting evidence showing that Sh. Ashish Kumar was no longer their agent as on 6.1.2009 and was not authorized to collect the insurance premium, due to which it could be easily presumed that Sh. Ashish Kumar was still the agent of the OPs.

vi] It is a well settled law that the master is responsible and liable for the acts of his Agent. Sh. Ashish Kumar had acted as the Agent of the OPs and not of the Complainant. He was appointed as Agent/ Adviser by the OPs and not by the Complainant, allotting him a specific code number. The OPs have clearly admitted that Sh. Ashish Kumar was their Agent at the time of issuance of the Insurance Policy and they have failed to give any proof for the termination of his Agency at a subsequent date, especially on or before 06.01.2009. Therefore, the OPs are fully responsible and liable for the acts of its Agent. The vicarious liability under the Law of Torts continues to lie with the OPs acting as Masters. Therefore, the OPs cannot be allowed to wash their hands off their liability for the receipt of Rs.25,000/- which was paid by the Complainant in utmost good faith to their authorized and approved Agent – Ashish Kumar.  

vii] OP No. 2 is also not only deficient in service, but has also indulged in totally unfair and unethical practice by accepting the renewal premium of Rs.25,000/- from the Complainant by way of self/cash cheque, withdrawing the amount from the paying bank and thereafter, not depositing the same with OP No. 1 and also not issuing any receipt to the Complainant for having receiving the said cash cheque from him.  

6]      Keeping in view the above detailed analysis of the entire case, it is our considered view that the present complaint has a lot of merit, weight and substance and, therefore, it must succeed in favour of the Complainant. We, therefore, allow the complaint in favour of the Complainant and against the OPs and pass the following order.

7]      The OPs shall, jointly and severally,  do the following:-

(i) OP No. 1 is directed to issue the officially printed receipt of Rs.25,000/- as the yearly premium paid by the Complainant to the Agent of the OPs on 06.01.2009. With the issuance of this receipt of Rs.25,000/- by OP No.1, the Insurance Policy issued by the OPs on 11.01.2008, shall also stand regularized and reinstated in favour of the Complainant, even if the same had been allowed to lapse earlier on account of non-payment of renewal premium. The Complainant shall also be allowed to deposit the next installment of insurance premium of Rs.25,000/- which was due for payment in January, 2010, accordingly.

(ii) OPs shall pay a compensation of Rs.10,000/- to the Complainant for causing physical harassment, mental agony and pain to the Complainant on account of non-issuance of the renewal premium receipt for Rs.25,000/- for the year 2009, despite the fact that the same had been paid by the Complainant to the authorized agent by OP No. 1 & 3. 

(iii) The OPs shall pay a sum of Rs.5,000/- as litigation cost to the Complainant.

8]      The aforesaid order be complied with by the OPs, jointly and severally, within a period of 30 days from the receipt of its certified copy, failing which the OPs shall pay the sum of Rs.10,000/-, along with interest @18% per annum from the date of filing of the present complaint i.e. 01.10.2009, till the date of realization, besides paying the cost of litigation as Rs.5,000/- and also complying with the order in full as at (i) in the foregoings.

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

Announced

16.03.2010                                       Sd/-

(LAKSHMAN SHARMA)

PRESIDENT

                                         Sd/-   

(ASHOK RAJ BHANDARI)

MEMBER

                                         Sd/-

(MADHU MUTNEJA)

MEMBER

‘Dutt’