DISTRICT CONSUMER DISPUTES REDRESSAL FORUM,<br /> BATHINDA (PUNJAB)<br /> <br /> CC No. 39 of 04.02.2008<br /> Decided on :06-05-2008 <br /> <br /> Amajit Kaur Sister of Harnek Singh deceased S/o Rab Singh, W/o Leela Singh R/o Village Nand Garh Kotra. Tehsil Phul, District Bathinda through her Special Power of Attorney Harmail Singh S/o Leela Singh R/o Village Nand Garh Kotra, Tehsil Phul, District Bathinda.<br /> ... Complainant<br /> Versus<br /> <br /> The Municipal Corporation, Bathinda, through its E.O./Commissioner<br /> ...opposite party<br /> <br /> Complaint under Section 12 of the Consumer Protection<br /> Act, 1986.<br /> <br /> QUORUM :<br /> Sh. Lakhbir Singh, President<br /> Dr. Phulinder Preet, Member<br /> <br /> For the Complainant : Sh.K.K. Vinocha, Advocate.<br /> For the Opposite party : Sh. Anil Gupta, Advocate. <br /> <br /> O R D E R<br /> <br /> LAKHBIR SINGH, PRESIDENT <br /> 1. This complaint under Section 12 of the Consumer Protection Act, 1986 (Here-in-after referred to as 'Act') has been preferred by the complainant through her special Attorney Harmail Singh S/o Leela Singh R/o Village Nand Garh Kotra seeking direction from this Forum to the opposite party to make all payments standing to the credit of deceased Harnek Singh on account of EPF/GPF, CPF, Ex-Gratia, Gratuity, Group Insurance etc., which comes to around Rs. 4,78,411/- alongwith interest @ 18% P.A. from 29.10.06 i.e. the date of his death till payment; Rs. 20,000/- as damages/compensation for mental tension and agony besides cost of the complaint. <br /> 2. Harnek Singh (now deceased) was class IV employee of the opposite party. Lastly he was serving as “Beldar” in Punjab W/S & Sewerage Board Division,. Bathinda being on deputation from M.C. Bathinda to Punjab. He was the real brother of the complainant. He has since died unmarried and issueless on 29.10.06 while in service. It is alleged that he during his life time with his free will and full consent had appointed, nominated and constituted her (complainant) as his nominee to receive all of his accrued service monetary benefits in the event of his death which include death gratuity, leave encashment, Ex-Gratia, arrears of pay etc., Being the nominee, she is entitled to receive all the benefits standing to the credit of the deceased. It is averred that following amounts are standing to his credit on account of benefits with the opposite parties :<br /> Rs. 2,66,063/- as Death Gratuity<br /> Rs. 9675/- as leave encashment<br /> Rs. 1,52,673/- as G.P.F. Plus accrued interest thereon<br /> Rs. 50,000/- as Ex-Gratia: Deductions are of Rs. 2800/- and Rs. 78945/- plus interest thereon payable by the deceased on account of Festival Advance obtained from Punjab W/S. & Sewerage Board and loan from Bathinda Central Co-op Bank, Bathinda, respectively.<br /> Total approximate sum of Rs. 4,78,411/- is lying with the opposite party. It is liable to pay it to her. Earlier complaint was filed by Sh. Harmail Singh Attorney in his individual capacity as nominee which was withdrawn by him from this District Fora in view of the stand taken by the opposite party by way of relinquishing his rights in favour of his mother Amarjit Kaur (complainant). Request was made to the opposite party to make payment of the due amount but it refused through its officials. In these circumstances, it is alleged that there is deficiency in rendering service on the part of opposite party.<br /> 3. Opposite party filed reply of the complaint taking preliminary objections that complainant has no locus standi to file the complaint; complaint is bad for non-joinder of parties and mis-joinder of party; complaint has not been filed through authorised and competent person; this Forum has got no jurisdiction to entertain and try the complaint; complainant has failed to produce Succession Certificate as per Annexure 6 of the Provident Act, 1925; nominee is entitled to receive provident fund without Succession Certificate only if the amount is less than Rs. 5,000/-; she does fall within the ambit of family and as such she is not entitled to Ex-Gratia or leave encashment and without order of the competent court and production of Succession Certificate the payment cannot be made to the complainant as brother of the deceased has also claimed the benefits. On merits, it admits that Harnket Singh was serving as Beldar and he was on deputation from opposite party with Punjab W/S & Sewerage Board. As per its record deceased had made his nomination in favour of the complainant and he has since died on 29.10.06 while in service. There is dispute between the heirs of the deceased. It denies the remaining averments in the complaint.<br /> 4. In support of her averments contained in the complaint, she has produced in evidence affidavit of her attorney Harmail Singh (Ex. C-1), photocopy of Special Power of Attorney (Ex. C-2), photocopy of order dated 13.12.07 (Ex. C-3), photocopy of application dated 17.12.07 (Ex. C-4), photocopy of postal receipt (Ex. C-5), photocopy of postal receipt (Ex. C-6), photocopy of Death Certificate of Harnek Singh (Ex. C-6), photocopy of statement of account (Ex. C-7), photocopies of affidavits of Sh. Lakhvir Trikha (Ex. C-8 & Ex. C-10) and photocopies of affidavits of Er. J S Deol, XEN (Ex. C-9 & Ex. C-11).<br /> 5. In rebuttal, on behalf of the opposite party affidavit of Sh. Lakhvir Trikha, Accountant (Ex. R-1) and photocopy of application dated 19.12.07 (Ex. R-2) have been tendered in evidence.<br /> 6. We have heard learned counsel for the parties. Besides this, we have gone through the record and written brief of arguments submitted on behalf of the complainant. <br /> 4. One of the objections taken by the opposite party is that complainant is not consumer and as such this Forum has got no jurisdiction to entertain and try the complaint as opposite party is not rendering any service to her for consideration. Opposite party is a statutory body. Its officers/officials are rendering statutory services. Opposite party invests contributions and other deduction to the Provident Fund etc. like any banker or financial institution and credits interest to the subscribers accounts. Harnek Singh was also contributing some amount towards General Provident Fund. All this is rendering of service for consideration under the Act. Hon'ble National Commission in the case of Jagdish Kumar Bajapi Vs. Union of India, Ministry of Health, Welfare and General Health Services 2006 CTJ-7(CP)(NCDRC) has made observations on the b asis of the observations of their Lordships of the Hon'ble Supreme Court in the cases of D. S. Nakara Vs. Union of India (1983) 1 SCC 305 and State of Kerala Vs. M. Padmanabhan Nair ((1985) 1 SCC 429 that it is clear that pension scheme varies from time to time in the Society. Pension is paid according to rules and it provides social security law alongwith benefits in kind such as free medical aid in a Democratic Welfare State. This is a necessity for survival of retired employees. Hence, pension including other service benefits payable under the scheme framed by a Government is a valuable right vesting in a retired Government employee. It is a part of wages and in that it consists of payment provided by an employer, is paid in consideration of past service and the purpose of helping the recipient to meet the expenses of living. It is not bounty but is an obligation of a welfare society and that too it is in accordance with the constitutional goal. Under the law, consideration can be in cash or kind. The definition of the word 'consumer' under Section 2(1)(d)(ii) provides that a person would inter-alia be a consumer if he hires or avails of the services for consideration paid (paid in past or agreed to be paid in future including deferred payment). In consideration of services rendered to the Government till the age of superannuation, a right is conferred upon an employee to get pension as well as other benefits including medical treatment prescribed by various rules or the schemes framed by the Government. Apart from this, Hon'ble National Commission in the case of Regional Provident Fund Commissioner, Faridabad Vs. Shiv Kumar Joshi 1996 LLR 641 has held that perusal of the Employees Provident Fund & Miscellaneous Provisions Act 1952 and the Scheme of 1952 shows that the Commissioners constituted under the Act and 1952 Scheme extend out service within the meaning of Section 2(1)(o) of the Act to the subscriber for consideration. Participation in the Provident Scheme would fall in the category of Consumer as has been held in the case of Chandramohan M. Anchan Vs. Bank of Baroda and another 2005(1) JRC 51. Complainant is the nominee of Harnek Singh who was Class IV employee of the opposite party. She is nominee as well as beneficiary concerning the dues which became payable after the death of Harnek Singh. In these circumstances, she is the consumer and this complaint is maintainable before this Forum.<br /> 5. Prayer of the complainant is that direction be given to the opposite party to make all the payment standing to the credit of deceased Harnek Singh on account of EPF/GPF, CPF, Ex-Gratia, Gratuity, Group Insurance etc amounting to Rs. 4,78,411/- alongwith interest @18% P.A. From 29.11.06 i.e. the date of death of Harnek Singh till payment. Lakhvir Trikha is the Accountant with the opposite party. He has given in writing that dues of Harnek Singh concerning Death Gratuity, Leave Encashment, G.P.F. and Ex-Gratia are to the tune of Rs. 2,66,063/-, Rs. 9,675/-, Rs. 1,52,673/- and Rs. 50,000/- respectively. Out of this amount of Rs. 4,78,411/- his liabilities are Rs. 2800/-, Rs. 78,945/- + interest, Rs. 3,60,000/- + interest for Festival advance taken from Punjab Water Supply and Sewerage Board, loan of Bathinda Central Co-op Bank and loan of Allahabad Bank. Again Sh. Lakhvir Trikha in his affidavit dated 20.11.07 copy of which is Ex. C-10 made it clear that due to inadvertence and over sight the loan of Rs. 3,60,000/- of Allahabad Bank has been wrongly shown in the list of dues outstanding against deceased Harnek Singh. In fact that Harnek Singh is different person. Hence, the conclusion is that Harnek Singh S/o Rabb Singh is not liable to pay Rs. 3,60,000/- plus interest towards loan of Allahabad Bank. His liabilities are Rs. 2800/- and Rs. 78945/- plus interest.<br /> 6. Arguments advanced by Mr. Gupta, learned counsel for the opposite party are that complainant is not entitled to receive the payments standing to the credit of deceased Harnek Singh as she does not fall within the definition of family member as defined in rule 6.16-B of the Punjab Civil Services Rules Volume -II Chapter VI. Complainant has not produced any Succession Certificate as per Annexure 6 of the Provident Fund Act and as such she is not entitled to receive the amount of Provident Fund particularly when the amount of General Provident Find is above Rs. 5,000/-. He also drew our attention to the letter dated 13.9.99 according to which direction has been given about the manner in which amount of Leave Encashment is to be given to the family or legal heirs of the employee who has died after 1.1.96. His next contention is that application has also been moved by Jarnail Singh, brother of the deceased to the opposite party claiming to be legal heir of the deceased and copy of the same is Ex. R-2.<br /> 7. Mr. Vinocha learned counsel for the complainant argued that admittedly complainant is the nominee of deceased Harnek Singh. Moreover she is his sister. In these circumstances, she is entitled to get the payments of the dues of Harnek Singh i.e. Death Gratuity, Leave Encashment, G.P.F. and Ex-Gratia.<br /> 8. We have considered the respective arguments.<br /> 9. As per Rule 6.16- B of Punjab Civil Services Rules Volume II Chapter VI family includes following relatives of the officer :- <br /> (a) “family” shall include the following relatives of the officers :-<br /> (i)wife or wives including judicially separate wife or wives, in the case of male officer ;<br /> (ii)husband including judicially separated husband, in the case of female officer;<br /> (iii)sons;<br /> (iv)unmarried and widowed daughters (including step-children and adopted children)<br /> (v)brothers below the age of 18 years and unmarried and widowed sisters, including step brothers and sisters;<br /> (vi)father, )including adopted parents in case of individuals whose<br /> (vii)mother )personal law permits adoption<br /> (viii)married daughters; and<br /> (ix)children of a predeceased son;<br /> (b) “persons' for the purpose of this rule shall include any company or association or body of individuals, whether incorporated or not<br /> (2) An Officer shall, at any time after confirmation, make a nomination conferring on one or more persons, the right to receive any gratuity that may be sanctioned under sub rules (2) and (4) of rule 6.16-A and lany gratuity which having become admissible to him under sub-rule (1) of that rule and rule 6.16 has not been paid to him before death;<br /> Provided that if at the time of making the nomination the officer has a family the nomination shall not be in favour of any person or persons other than the members of his family.<br /> (3) If an officer nominates more than one person under sub rule (2), he shall specify in the nomination the amount or share payable to each of the nominees, in such manner as to cover the whole amount of the gratuity.<br /> (4) An officer may provide in a nomination -<br /> (a) in respect of any specified nominee, that in the even of his predeceasing the officer, the right conferred upon that nominee shall pass to such other persons as may be specified in the nomination, provided that if at time of making the nomination the officer has a family consisting of more than one member, the person so specified shall not be a person other than a member of his family;<br /> (b) that the nomination shall become invalid in the event of the happening of the contingency specified therein.<br /> (5) The nomination made by an officer who has no family at the time of making it, or a provision made in nomination under clause (a) of sub-rule (4) by an officer whose family consists, at the date of making the nomination of only one member, shall become invalid in the event of the officer subsequently acquiring a family or an additional member in the family as the case may be.<br /> (6) (a) Every nomination shall be in such one of the forms Pen 1-C to Pen. 1-F as may be appropriate in the circumstances of the case.<br /> Note : The forms provide for only one alternate nominee and it is not open to a Government employee to nominate more than one alternative nominee against any original nominee. <br /> (b) An officer may at any time cancel nomination, by sending a notice in writing to the appropriate authority; provided that the officer shall, alongwith such notice, send a fresh nomination made in accordance with this rule.<br /> (7) Immediately on the death of a nominee, in respect of whom no special provision shall be made in the nomination under Clause (a) of sub-rule (4), or on the occurrence of any event, by reasons of which the nomination becomes invalid, in pursuance of clause (b) of that sub-rule or sub-rule (5), the officer shall sent to the appropriate authority a notice in writing formally cancelling the nomination, together with a fresh nomination made in accordance with this rule.<br /> (8) Every nomination made, and every notice of cancellation given, by an officer under this rules, shall be sent by him to Accountant General, Punjab in the case of gazetted officer, and to the Head of his office in the case of non-gazetted officer. Immediately on receipt of nomination from non-gazetted officer the Head of the office shall countersign it, indicating the date of receipt, and keep it in safe custody.<br /> (9) Every nomination made, and every notice of cancellation given by an officer, shall, to the extent that it is valid, take effect on the date on which it is received by the authority mentioned in sub-rule (8).<br /> Note : While a nomination as also any change therein will normally be made by an officer during his service, he may be allowed to make a fresh nomination after retirement if such a contingency arises.<br /> 10. There is no dispute about the fact that deceased has died unmarried and issueless and his parents have predeceased to him. Proviso to rule 16.6-B (2) is reproduced as under :-<br /> “Provided that if at the time of making the nomination the officer has a family the nomination shall not be in favour of any person or persons other than the members of his family.” <br /> It is clear from this proviso that in the absence of family member there is no prohibition in making nomination other than defined family members. In this manner, nomination made by the deceased in favour the complainant who is his real sister is not illegal and invalid. Moreover as per Section 6 of The Payment of Gratuity Act, 1972 each employee, who has completed one year of service, shall make, within such time, in such form and in such manner, as may be prescribed, nomination for the purpose of the second proviso to sub-section (1) of Section 4. Sub Section 4 of this Section is reproduced as under :<br /> “(4) If at the time of making a nomination the employee has no family, the nomination may be made in favour of any person or persons but if the employee subsequently acquires a family, such nomination shall forthwith become invalid and the employee shall make, within such time as may be prescribed, a fresh nomination in favour of one or more members of his family.”<br /> Sub Section (4) also makes the position crystal clear that nomination by the deceased employee can also be made in favour of his sister particularly when he has no family.<br /> 11. Letter No. 1/10/98-3 v-p.2/13201 Miti 13.9.99 referred to by the learned counsel for the opposite party is no bar to the payment of the Leave Encashment to the nominee of the deceased employee. It merely gives the criteria regarding the period concerning which leave encashment can be allowed. Hence opposite party cannot evade liability of payment of Leave Encashment to the complainant on the basis of this letter. No rule has been shown to us by the learned counsel for the opposite party according to which the amount of Gratuity concerning deceased employee cannot be paid to his nominee. Learned counsel for the opposite party referred to Rule 2.7 of Punjab Civil Services Rules Volume II according to which Government may allow ex-gratia grant to the members of the family of a Government employee, including a member of All India Service under the Punjab Government who dies while in service as indicated in the Annexure to this Chapter. As per certificate of Sh. Lakhvir Trikha copy of which is Ex. C-7 Ex-Gratia amount payable is Rs 50,000/- in this case. Rule 2.7 does not debar the nominee of the deceased employee to receive this amount.<br /> 12. Since amount of Gratuity , Ex-Gratia and Leave Encashment concerning deceased has not been paid to the complainant who is his nominee, there is deficiency in service on the part of opposite party. For this, reference may be made to the authority Smt. Y. Yasodhamma and Others Vs. The Superintendent of prohibition & Excise 2003(2) JRC page 43. May be that Jarnail Singh had moved application to the opposite party, copy of which is Ex. R-2, but this itself is no ground for the opposite party to withold the amount on this account. Nothing has been brought on the record that what action has been taken by the opposite party on this application. Mere filing of the application by someone raising some objection in an uncertain and vague manner, does not entitle the obligator to withhold the payment which it is bound to make otherwise and can get valid discharge. Opposite party has failed to show us any stay order by any competent court with direction that payment of Gratuity, Leave Encashment and Ex-Gratia be not made to the nominee who is generally a trustee and can give valid discharge. Moreover as to who are the legal heirs, they must get that factum determined from a competent court in accordance with the Law as has been held by the Hon'ble State Commission, Punjab in the case of Paramjit Kaur and Others Vs. Branch Manager, Life Insurance Corporation of India and others 2005(2) Judicial Reports Consumer page 582.<br /> 13. As regards the amount of General Provident Fund to the tune of Rs. 1,52,673/- is concerned, objection of the opposite party that it is not payable to the complainant without Succession Certificate is tenable. Section 5 of the Provident Fund Act, 1925 lays down the rights of the nominees according to which the nominee on the death of subscriber or depositor becomes entitled to the exclusion of other person to receive such sum or part thereof as the case may be. Appendix 6 of Punjab Civil Services Rules Volume II Example 3 is reproduced as under :<br /> “Example 3 (1) There is no family and there is nomination in favour of a person who is a dependant as defined in section 2(c) of the Act. The money vests in the nominee and payment must be made to the nominee (See Section 3(2) of the Act.)<br /> (ii) There is no family and there is a nomination in favour of a person who is also not a dependant. Payment will be made to the nominee if the amount does not exceed Rs. 5,000/- (See Section 4(1)(b) and the relevant Provident Fund Rules) but if the amount exceeds Rs. 5,000/- payment will be made to such nominee only on production of a succession certificate, probate or letters of administration (See Section 4(1)(c)(i)).”<br /> 14. As mentioned above legal effect of nomination has been sated in Section 5 of the Provident Fund Act. Section 5(1) by itself does not provide for any nomination to be made and does not by itself create any right in the favour of the nominee. It merely gives protection and force to a nomination made in accordance with the rules of the Provident Fund. If, therefore, a rule exists in any provident Fund Rules rendering nominations invalid by marriage or remarriage, nominations even if valid when made, will become ineffective if a subscriber marries or remarries and will not be nominated to which the protection of Section 5(1) of the Act will extend. Rule 13.1(7) of the Punjab General Provident Fund Rules only gives protection to nominations made before the rules came into force. Section 5(2) of the Provident Fund Act merely extends the scope of Succession Certificate Act of 1889 and Bombay Regulation VIII of 1827 and enables nominees mentioned in Section 5(1) to claim succession certificate under these enactments (payment of such claims has also be provided for in section 4(c)(1) of the Provident Fund Act). If nomination is in favour of the outsider i.e. a person who is not dependent on the subscriber as is in the case in hand, payment of the Provident Fund is regulated under Section 4(1)(b) of the Provident Fund Act if the total amount does not exceed Rs. 5,000/- and under Section 4(1)(c)(i) if the amount exceeds Rs. 5,000/-. In this case amount of Provident Fund exceeds Rs. 5,000/-. Hence payment of the Provident Fund can be made to the complainant/nominee of the deceased only on production of Succession Certificate. Since Succession Certificate has not been produced before the opposite party, there is no deficiency in service on its part in not making payment of General Provident Fund.<br /> 15. Now question arises as to which relief should be accorded regarding payment of Gratuity, Leave Encashment and Ex-Gratia to the complainant/nominee concerning Harnek Singh, deceased. Opposite party was bound to make payment of these amounts to the complainant which have not been made despite the fact that she sent application copy of which is Ex. C-4 to the opposite party on 17.12.07. She becomes entitled to interest on account of delay caused in the payment of these amounts. Accordingly direction deserves to be given to pay her the amount on these counts as nominee of the deceased alongwith interest @9% P.A. from 25.12.07 till payment subject to the condition that she furnishes Indemnity Bond. Opposite party would be at liberty to deduct the amount of the liabilities of the deceased from the amount payable to the complainant on these three counts while making payment. Complainant is craving for compensation of Rs. 20,000/- for mental tension and agony. There is no case to allow it in view of the relief which is going to be accorded as above.<br /> 16. No other point was urged before us at the time of arguments.<br /> 17. In the premises written above, complaint is partly allowed against the opposite party with cost of Rs. 1,000/-. Opposite party is directed to do as under: <br /> i) Make payment of Rs. 2,66,063/- as Death Gratuity, Rs. 9675/- as Leave Encashment and Rs. 50,000/- as Ex-Gratia to the complainant concerning deceased Harnek Singh alongwith interest 9% P.A. from 25.12.07 till payment after making deduction of the amount of Rs. 2800/- and Rs. 78945/- plus interest out of this amount towards liability of deceased Harnek Singh on her furnishing personal Indemnity Bond of Rs. 4.00 Lacs with one surety in the like amount to be accepted and attested by the opposite party after its satisfaction. She would undertake in the Indemnity Bond and Surety Bond that she would refund this amount received by her in case any better claimant appears and any amount out of this amount is legally payable to any other person/persons and amount is being received by her as nominee/trustee.<br /> ii) Indemnity Bond and Surety Bond would be submitted by the complainant within 15 days from the date of receipt of copy of this order and the opposite party would make payment of the amount within 7 days from the date Indemnity Bond and Surety Bond are accepted and attested by it. In case she does not furnish the Indemnity Bond and Surety Bond as referred to above within 15 days from the date of receipt of copy of this order, she would not be entitled to interest on the principal amount referred to above for the period beyond 15 days from the date of receipt of copy of this order.<br /> 18. Compliance regarding payment of cost be made within 30 days from the date of receipt of copy of this order <br /> Copy of this order be sent to the parties concerned free of cost and file be consigned to record room.<br /> Pronounced :<br /> 06-05-2008 (Lakhbir Singh )<br /> President<br /> <br /> <br /> (Dr.Phulinder Preet)<br /> Member <br />