DISTRICT CONSUMER DISPUTES REDRESSAL FORUM  PALAKKAD

Dated this the 15^th day of October 2018

Present   : Smt.Shiny.P.R. President

              : Smt.Suma.K.P. Member                                Date of filing:  15/09/2017

              : Sri.V.P.Anantha Narayanan, Member

CC/131/2017

Manikandan.V,

S/o Vijayaraghavan.C,

11/190, Easwra Kripa,

Tailor Street, Palakkad,                                  -  Complainant       

678 001.

(By party in person)

                                                            Vs

Head Post Office, Palakkad.

678 001.

Thiruvananthapuram,

695 003.

Office of the Chief Accountant General,

Kerala, Thiruvananthapuram.

                                                          O R D E R

By Smt.Suma.K.P. Member

           The complainant has insured his life under Postal Life Insurance Scheme with endowment assurance policy No.KL-116468-CS for a sum assured of Rs.50,000/- on 16.08.2010.  The maturity date of the same was on 16.08.2017.  The complainant is a Kerala State Govt. Employee and the premium for his Postal Life Insurance was deducted from his salary.  He had paid the premiums upto July 2017, and had submitted all the necessary documents before the Superintendent of Postal Department.  He was asked to remit Service Tax and GST for the above policy and accordingly he paid the amount towards it.  The maturity amount was not credited towards his account even after the due date.  Hence he enquired about it to the clerk of the Postal Life Insurance Section of Head Post Office, Palakkad and also to the Superintendent and lodged a complaint through online to the authorities concerned but there was no response. The complainant alleges that the said act amounts to deficiency of service on the part of the opposite parties.  He had also submitted that if he had received the maturity amount intime, he could have closed a gold loan.  Due to the above act of the opposite parties he had suffered a lot of mental agony, and had approached before the Forum for the redressal of his grievance. 

          Notice was issued to the opposite parties.  Opposite parties entered appearance and filed their version stating the following.

          It is admitted that, the complainant insured his life under Postal Life Insurance Scheme with Endowment Assurance Policy No.KL-116468-CS for a sum assured of Rs.50,000/- on 16.08.2010.  The maturity date of the same was on 16.08.2017.  As per the terms of the contract of the PLI scheme the proposer named as the insured in the schedule of the policy document has deposited with a proposal and declaration for Endowment Assurance on his own life mentioned in such schedule has agreed that the said proposal and declaration signed by him shall be the basis of contract for such insurance with the President of India.  President of India shall be subjected and liable to pay the sum mentioned in the policy document together with bonus, if any declared by President of India to the insured or his assignees as early as possible after the insured has attained the age specify in the said policy document as if he/she shall die without receiving payment unto the execution.  The complainant is a Kerala State Govt. Employee and the premium for his Postal Life Insurance was being deducted from the salary of the employee.  The premium of such cases are being paid to the Department of Posts through office of Accountant General, Kerala and credits to the respective policy will be afforded centrally from Central Processing Centre, Thiruvananthapuram, General Post Office.  The complainant had submitted the maturity application of his insurance policy on 09.08.2017 for processing at the Central Processing Centre (CPC) Palakkad HPO.  While processing his request for the maturity in the software, the policy was seen updated till December 2016 only.  On contacting with the Office of Deputy Divisional Manager (PLI), Office of Chief Post Master General, Kerala Circle, Thiruvananthapuram it could be ascertained that the recovery schedule along with DD in respect of policies of State Government Employees have been received from the Office of Accountant General, Kerala only upto December, 2016.  The maturity application could not be processed then for want of full premium credit in the policy. Every insurance under Postal Life Insurance Scheme must credit the monthly premium before the last working day of each month.  In case he/she fails to make payment as above, it can be paid in the subsequent month with penalty for each default monthly payment.  If an insurant fails to make payment continuously for six months in respect of a policy which is less than three years old or twelve months in respect of a policy which is more than three years old, the said policy will lapse and can be revived only if he/she undergoes another medical checkup and remits the arrears of premium  with penal interest in lump sum.   While entering into a contract to insured with the Postal Life Insurance Scheme, an insurant if provided with two options for making monthly premium, i.e either to pay premium through any Post Office in India by rendering cash commonly known as “cash” mode or to cause recovery of premium automatically from his/her salary though his Drawing and Disbursement Officer commonly known as “PAY” mode.  The pay recovery option is limited to certain categories of insurants only such as the employees in Central Government Department, State Government Department and their PSU’s etc.  Only when premium  is received either as cash at Post Office counters or as Cheque/DD from the DDO of salaries employee, his/her monthly premium is posted in the ledger of his respective PLI policy in the system.  In the case of State Government Employees in Kerala Postal Circle, the monthly receipt of premia and posting of the same in to the ledger of each policy holder as “credits” pertaining to the “PAY” policies are fulfilled through a lengthy and time consuming process as detailed below.  The number of PLI ‘PAY policies pertaining to Kerala State Government Employees comes to around 17000 odd policies.  The premium is first recovered from the salary of the employees by the respective DDO (Drawing & Disbursing Officer) and the total amount is remitted to the Treasury concerned.  The Treasuries will in turn record the premium recoveries in their software known as ‘SPARK’ and forward the premium recovery schedules to the District Treasuries and from there it is sent to the Directorate of Treasuries, Thiruvananthapuram for consolidation.  The Directorate of Treasuries after consolidation of the Premium Recovery Schedules received from the 23 District Treasuries under its control submits a single Premium Recovery Schedule pertaining to Kerala State Government employees supported by a cheque for an amount equivalent to the figure shown in the schedule to the Principal Accountant General’s (Pr.AG’s) Office, Thiruvananthapuram, who is the authority for conciliation of PLI premium recovery schedules received from Kerala State Government Directorate of Treasuries, Thiruvananthapuram.  The Principal Accountant General’s office after reconciliation pays the premium by way of Demand Draft drawn in favour of the Sr.Postmaster, General Post Office, Thiruvananthapuram, who is the nodal officer for this purpose along with the reconciled premium recovery schedule.  Posting of all the 17000 odd policies in the premium recovery schedule at the PLI CPC (Central Processing Centre), Thiruvananthapuram GPO is done in a week’s time after the receipt of the schedule.  Due to the time taken for the recording of premia in the ‘SPARK’ software/consolidation of 23 premium recovery schedules from the District Treasuries at the Directorate of Treasuries and reconciliation of the same at the principal Accountant General’s Office/huge delay happens at the employer’s level and leads to inordinate delay in the submission of premium recovery schedule to the Sr.Postmaster, General Post Office/Thiruvananthapuram.  There is no delay from the part of the General Post Office, Thiruvananthapuram in updating the premium into the ledger of each policy as ‘credits’ once the Schedule supported by Demand Draft is received. 

A delay of over 18 months was once experienced for the receipt of the premium recovery schedule few months back and the matter was taken up numerous times with the Directorate of Treasuries, Thiruvananthapuram, Principal Accountant General, Thiruvananthapuram and even once with the Finance Secretary (Kerala State Government).  After many deliberations with the above mentioned authorities, the Directorate of Treasuries, Thiruvananthapuram have sent a premium recovery schedules supported with demand draft up to March 2017 and the entire credit details have already been posted in the ledger of policy holders up to March 2017.  The delay to sent the amount through DD entirely rests on the part of Treasuries, Directorate of Treasuries and the AG’s office and the Department of Posts is in no way responsible for it.  The PLI premium (Net Accretion) collected on a day in the whole country is being daily invested through the investment board situated in Mumbai and from its returns, the policy holders are given benefits.  Due to the delay in receipt of premium from the Kerala State Government employees, Department of Posts is incurring heavy loss as the average monthly premium of the unit which comes to around Rs.1.75 crore could not be invested.  Department of Posts is not collecting any penalty in the form of default fee in respect of these 17000 odd policies for the delay in payment of premium caused by the employer.  Through majority of these policies get lapsed due to this inordinate delay, we are also saving the insurants from the burden of revival of policies as once the default in premium in lump sum credits crosses 12 months (6 months for policies less than 3 years old) the insurants are liable to revive the policy by paying all the arrears in premium along with the compounded interest accompanies by a medical certificate of good health.  The Department is actually taking a lenient view in this regard by not treating these policies as lapsed even beyond the stipulant term of 12 months and also no penal interest is recovered.  Insurants are voluntarily opting the ‘PAY’ mode and they are not being forced into it by us.  There is provision for payment of premium at any post office as well as through the online mode if the insurants opt for ‘CASH’ mode.  Also, there is a provision to convert the mode of payment from ‘PAY’ to ‘CASH’ or vice versa at any point of time during the term of the policy.  Hence, it is submitted that the maturity claim pertaining in the policy KL-116468-CS held by Shri.Manikandan V can be settled only after the receipt of recovery schedules up to the month of Last-Instalment which is July 2017.  The Department of Posts is not at all responsible for the delay in posting of premium ledger credits and is helpless in the settlement of claim unless the premium payment is made and the duly reconciled schedules containing the details of recovery received at our end.  The delay happened solely due to reasons beyond control of the opposite parties and there was no deficiency of service on their party.  Hence the complaint had to be dismissed.     

Complainant filed chief affidavit.  Opposite parties filed additional version raising a contention that Accountant General, Kerala Circle, Thiruvananthapuram had to be impleaded for the proper adjudication of the above complaint.  Accordingly complainant filed an application to implead Accountant General as supplemental opposite party.  Application was allowed and complaint was amended accordingly.   Notice was issued to supplemental 3^rd opposite party. 

The supplemental 3^rd opposite party filed version stating the PLI accounts are not maintained in their office upto 3/2016 posting the individual account of State Government employees were done in their office and DD for the posted amount along with certified list of posted accounts were sent to the Postal Authorities.  From 4/2016 onwards no posting is done in their office.  Their office is issuing DD to the Senior Post Master, GPO, Thiruvananthapuram for the amount booked under the PLI Head of Account by State Treasuries for a month.  In this connection it was also informed that no representation regarding missing credits has been received from the complainant in their office.  The duty of supplemental 3^rd opposite party is limited only to the extend of drawal and issuance of DD in favour of Senior Post Master, GPO, Thiruvananthapuram for the amount equal to the amount booked by Treasury denoting the monthly total of the PLI deduction.  DD upto 2/2018 has been forwarded from their office.  In the new electronic environment which facilitates sharing of data at different ends, schedules (hard copies) are not necessary and the Postal Department can login to access the details of deduction of policy holders, as and when it occurs.  As such the supplemental 3^rd opposite party has no further action in this regard. 

Complainant filed additional affidavit.  Opposite parties also filed their proof affidavit.   Exts.A1 & A2 was marked from the part of the complainant.  Exts.B1 to B3 was marked from the side of the opposite parties.  Ext.X1 was also marked.  Evidence was closed and the matter was heard. 

The following issues that arise for consideration are.

1. Whether there is any deficiency of service from the part of opposite parties?
2. If so, what are the relief and cost?

Issues 1 & 2

           We have perused the affidavits and documents produced before this Forum, it is evident from Ext.A2 that the Drawing & Disbursing Officer of the complainant had issued a statement of recovery for the premium towards the above scheme for the last six months from 2016 August to 2017 July.  The opposite parties had contended that the delay occurred in processing the maturity claim is due to non receipt of premium credits by supplemental opposite party 3 from the State Government Authority.  The complainant’s policy was updated only till December, 2016.  Opposite party 1 & 2 had submitted that in the instant case the supplemental opposite party 3 vide letter number LC 3/15-2010(46)18-19/138/298 dated.09/05/2018 (Ext.X1) had admitted that from April 2016 onwards no posting was done.  Hence, the deficiency of service is on the part of supplemental opposite party 3.  But, in this case the complainant does not have any privity of contract with supplemental opposite party 3.  The complainant is having contract only with opposite parties 1 & 2 and it is the bounden duty of opposite parties 1 & 2 to make sure that the deducted amount is collected properly on the day of disbursal of pay and allowances and the premium amount lies with the Kerala State Government till it is given to the Senior Post Master, Central Post Office, Thiruvananthapuram for each months total premium collection.  If it is not done promptly they ought to have taken sufficient steps for the updation.  No evidence is produced before this Forum from the part of the opposite parties 1 & 2 to prove that they had initiated any steps for the same.  Without doing so they had committed deficiency of service on their part.  They cannot blindly walk over of their responsibility by shifting the liability upon supplemental opposite party 3 and by delaying the payment to the consumer which clearly amounts to negligence as well as deficiency of service from their part.  Hence we attribute deficiency of service on the part of opposite parties 1 & 2 for the delay caused in payment of the maturity amount due towards the consumer/complainant.  Consumers should not be put into trouble for the delay caused on administrative side due to the negligence of the officials.  The opposite parties 1 & 2 ought to have paid the amount due to the consumer and shall takes steps against supplemental opposite party 3 for the loss suffered by them thereby the bonafie consumers should not have suffered. 

          Hence the complaint is allowed and we direct the opposite parties to pay Rs.50,000/- (Rupees fifty thousand only) plus bonus along with 8% interest for the maturity amount of Rs.50,000/- (Rupees fifty  thousand only) from 16.08.2017 till date of realization.  We also direct the opposite parties 1 & 2 to pay Rs.5,000/- (Rupees five thousand only) as compensation for the mental agony and financial difficulties suffered by the complainant along with Rs.2,000/- (Rupees two thousand only) towards cost of this litigation. 

The aforesaid amount shall be paid within one month from the date of receipt of this order; failing which the complainant is entitled to realize 9% interest p.a from the opposite party on the total amount due to him from the date of this order till realization.

          Pronounced in the open court on this the 15^th  day of October  2018.

            Sd/-      

                   Shiny.P.R

                   President 

                        Sd/-       

                   Suma.K.P

                    Member

          Sd/-     

    V.P.Anantha Narayanan

                   Member

Appendix

Exhibits marked on the side of complainant

Ext.A1          -  Original Recovery for Premia from Pay for the last six months (Drawing &

             Disbursing Certificate).

Ext.A2          -  Photocopy of Acknowledgment receipt - PLI

Ext.X1 -  Original letter sent by Accountant General, Kerala to Consumer Disputes

             Redressal Forum, Palakkad.

Exhibits marked on the side of Opposite parties

Ext.B1 series -  Certified copy of Annexure R-1 issued by Department of Posts

   (4  pages)

Ext.B2 series - Certified copy of maturity claim settlement issued to the complainant

                       (2 pages)

Ext. B3 series          - Certified copy of letter sent by AG, Kerala to the Senior Post Master,

                       GPO, Thiruvananthapuram (4 pages)

Witness examined on the side of complainant

Nil

Witness examined on the side of opposite parties

Nil

Cost

          Rs.2,000/-