Haryana

Karnal

259/13

Parsanta Dutta - Complainant(s)

Versus

The Superintendent Of Police Railways Haryana - Opp.Party(s)

Pardeep Gill

26 May 2016

ORDER

BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM KARNAL.  

                                                               Complaint No.259 of 2013

                                                               Date of instt.: 31.5.2017

                                                               Date of decision:26.5.2016

 

Parsanta Dutta widow of Shri Ravinder Kumar, resident of House no. 915, New Prem Colony, Near Singla Hospital, Kaithal Road, Karnal.

 

                                                                   ……..Complainant.

                                      Vs.

1. The Superintendent of Police, Railways, Haryana, Ambala Cantt.

2. The Branch Manager, Life Insurance Corporation of India, Jeewan Sewa Building, Municipal Shopping Complex, Near Bus Stand Ambala City.

3. The Divisional Manager, Life Insurance Corporation of India, Jeewan Parkash, No.489,Model Town, Karnal.

                                                                   ………… Opposite Parties.

 

                     Complaint u/s 12  of the Consumer Protection Act.

Before           Sh.K.C.Sharma……….President.

                   Sh.Anil Sharma…….Member.

 

Present:-         Sh. Pardeep Gill Advocate for the complainant.

                    Sh. Ved Parkash Sub Inspector alongwith Shri Ram Niwas  

 G.P. for the Opposite party no.1.

 Sh.L.R.Chuchra Advocate for opposite parties no.2 and 3. 

 

 ORDER:

 

                        This complaint has been filed by the complainant u/s 12 of the Consumer Protection Act 1986, on the averments that her husband Ravinder Kumar (deceased life assured) was Government Employee and posted as Exemptee Assistant Sub Inspector (EASI) in the office of opposite party no.1. Life Insurance Corporation of India (LIC) had floated  a salary saving scheme, according to which the premium amount of the employee/policy holder was required to be deducted from the salary of the employee by the employer and  then to remit the premium in time periodically during the term of the policy to LIC. Her husband obtained insurance policy from opposite parties no.2 and 3 under the said scheme and policy bearing no.176680384 (Jeevan Saral) commencing from 18.5.2011 was issued. The policy term was 15 years and monthly premium amount of Rs.766/- was to be remitted to opposite parties no.2 and 3 by opposite party no.1 by deducting the same from the salary of her husband. On 4.5.2012 her husband expired. Thereafter, she lodged claim with the opposite parties no.2 and 3 in respect of the said policy but opposite parties no.2 and 3 repudiated her claim which amounted to deficiency in service due to which she suffered mental agony, pain and harassment apart from financial loss.

2.                Notice of the complaint was given to the opposite parties. Opposite party no.1 appeared and filed written statement. It has been admitted that the deceased life assured was under the employment of opposite party no.1 and he died untimely death on 2.5.2012. It has been submitted that the Government of Haryana had formulated e-salary scheme, vide which the salary was to be paid to the employees through e-commerce software. The said software was not having the programme for LIC deduction operational, so LIC contribution for salary saving scheme could not be deducted for the months of March and April, 2012. Intimation in that regard was forwarded to all the employees working under the control and supervision of opposite party no.1 and they were directed to deposit the contribution for the said months. Previous premiums were regularly remitted by opposite party no.1. It has also been averred that the opposite party no.1 cannot be said to be a service provider to deceased life assured of the complainant, therefore, neither the deceased life assured or the complainant was consumer of opposite party no.1,  and as such opposite party no.1 is not liable to pay the claim.

3.                Opposite parties no.2 and 3 filed joint written statement controverting the claim of the complainant. Objections have been raised that the complainant has not approached this forum with clean hands and that the complaint is abuse of process of law.

                   On merits, it has been submitted that the deceased life assured was a government employee and policy no.176680384 was issued to him for a sum of Rs.1,87,500/- on 18.5.2011 and premium of Rs.766/- was payable monthly through his employee i.e. opposite party no.1, as the policy was issued under salary saving scheme of the Corporation. The premiums for the months of March and April 2012 were not deposited with opposite parties no.2 and 3 and even grace period of 15 days also expired on 4.4.2012. The insured had expired on 4.5.2012. Therefore, the claim of the complainant was rightly repudiated, vide letter dated 16.10.2012, as the policy was in lapse condition on the date of death of the deceased life assured. In this way, there was no deficiency in service on the part of the opposite parties no.2 and 3.

4.                In evidence of the complainant, her affidavit Ex.CW1/A and documents Ex.C1 to C17 have been tendered.

5.                On the other hand, in evidence of  the opposite parties affidavit of  Jai Pal EASI Ex.RW1/A, affidavit of Ajay Gupta Manager Ex.RW2/A and documents Ex.R1 and Ex. RW2/2 to Ex.RW2/4 have been tendered.

6.                We have appraised the evidence on record, the material circumstances of the case and the arguments advanced by the learned counsel for the parties.

7.                There is no dispute between the parties regarding the fact that the deceased life assured was posted as EASI under the employment of opposite party no.1 and he had obtained insurance policy under salary saving scheme from opposite parties no.2 and 3.  Term of the policy was 15 years and premium was Rs.766/- per month which was to be deducted from his salary by opposite party no.1 and then to be remitted to opposite parties no.2 and 3. Deceased life assured died on 4.5.2012. The claim lodged by the complainant being nominee, was rejected by the opposite parties no.2 and 3 on the ground that the premiums for the months of March and April 2012 were not deposited.

8.                Learned counsel for the opposite parties no.2 and 3 laid emphasis on the contention that premiums for the months of March and April 2012 were not deposited by the employer of the deceased life assured. The grace period of 15 days had also expired on 4.4.2012. Thus, the policy was in lapse condition on the date of the death of deceased life assured, therefore, no amount was payable to the complainant under the said policy as per terms and condition of the policy.

9.                Learned Government Pleader for opposite party no.1 submitted that the premiums of the LIC of the employees of Government Railway police Haryana posted in the unit of Ambala Cantt. could not be deducted for the months of March and April 2012 due to technical defect in the e-salary system. Therefore, the employees were directed, vide letter the copy of which is Ex.R1, to deposit the premiums for the said months directly with the LIC. Thus, there was no fault on the part of the opposite party no.1. It has further been argued that opposite party no.1 was not service provider, therefore, neither the complainant nor the deceased life assured was consumer of opposite party no.1 and as such opposite party no.1 cannot be fastened with any liability.

10.              To wriggle out the aforesaid contention learned counsel for the complainant vehemently argued that there was no fault on the part of the deceased life assured in not depositing the premiums for the months of March and April 2012, because the premium amount was to be deducted by opposite party no.1 from the salary of the deceased life assured and then to be remitted to opposite parties no.2 and 3. No intimation was given by opposite party no.1 to deceased life assured during his life time that premium amount could not be deducted from his salary due to some technical defect in the e-salary system. The intimation to the employees was sent after the death of the deceased life assured on 10.5.2012 as is evident from Ex.R1, whereas the deceased life assured died on 4.5.2012. The terms and conditions of the insurance policy were to be performed through employer, therefore, employee could not suffer the consequence emanating from default on the part of the employer. In fact, opposite party no.1 was acting as agent for employees for collecting the premiums and pay the same to LIC on deduction from the salaries of the employees. Therefore, the opposite parties no.2 and 3 were liable to pay the claim to the complainant, even if, the opposite party no.1 did not deduct the premiums from the salary of the deceased life assured for the months of March and April 2012 and could not remit the same to opposite parties no.2 and 3. In support of his contention he has placed reliance upon Delhi Electric Supply Undertaking Vs. Basanti Devi and another 1999(8) Supreme Court Cases 229 and Chairman Life insurance Corporation and others Vs. Rajiv Kumar Bhasker 2005(6) Supreme Court Cases.

11.              In Delhi Electric Supply  Undertaking’s case (supra)  the deceased was employee of Delhi Electric Supply Undertaking and he was insured under salary saving scheme, the premium of which to be deducted by the employer every month from his salary and paid to LIC. The policy was to commence on 28.1.1992. An amount of Rs.636/- was paid as premium for two months. Premium for the next month was deducted from the salary and remitted to LIC. However, the amounts of premium for subsequent months, although deducted from salary, were not so remitted. Employee died on 17.8.1992. The claim of insurance amount made by his widow was rejected by LIC for defaults in payment of premium. Under those circumstances, it was held by Hon’ble Supreme Court that the employer although was not an insurance agent within the meaning of section 42 of the Insurance Act and the regulations, but was certainly an agent as defined in section 182 of the Contract Act. The mode of collection of premium was indicated in the scheme itself and the employer was assigned the role of collecting premium and remitting the same to LIC. As far as the employee as such is concerned, the employer will be an agent of LIC. Where the employer had failed to remit to LIC the premium amount deducted from the salary of the deceased employee, the LIC was liable to pay the insurance amount to deceased’s heirs. In Rajiv Kumar Bhaskar ‘s case (supra) also the same principle of law was laid down by the Hon’ble Supreme Court. It was held that salary saving scheme provides for a tripartite arrangement. In a scheme of this nature, the employer was to make all endeavours to improve the service conditions of the employees and discharge its social obligations towards them. So far as the employees are concerned, they could not approach the insurer directly, and, thus, for all intent and purport they were to treat their employer as agent of the Corporation. In any event, the employer was obligated to inform the employee that for some reason he is not a position to perform his obligation whereupon the latter could have paid the premium directly to the corporation. Even in case of non- payment of premium for any reason whatsoever, in view of the object of the scheme seeks to achieve, it was the duty of the insurer to inform the employee about consequences of non-receipt of such premium from the employer. LIC could not make the employee suffer consequences emanating from default on the part of the employer, its agent and had to bear the consequences thereof. Hence, it was liable to pay out on policies wherein premiums had not been paid due to default of the employer.

12.              The facts of the present case are to be analyzed keeping in view the proposition of law laid down in the aforesaid discussed authorities. The deceased life assured was employee of opposite party no.1 and he had obtained salary saving scheme policy from opposite parties no.2 and 3. Premium amount was to be deducted from his salary by opposite party no.1 and then to be remitted to  opposite parties no.2 and 3. Thus, opposite party no.1 was an agent for the deceased life assured. The premiums for the months of March and April 2012 were not deducted from the salary of the deceased life assured due to some technical defects in the e-salary system but no such intimation was given to deceased life assured immediately. Had such intimation been given immediately in the month of March, the deceased life assured could certainly deposit the premium amount with opposite parties no.2 and 3. Salary amount is generally sent to the Bank account of the employee, therefore, the employee may not in a position to know every month, whether premium amount has been deducted or not from his salary, because it is impossible from every employee to check his bank account every month. The document Ex.R1 shows that the opposite party no.1 sent intimation to its employees on 10.5.2012 that the premiums for the months of March and April, 2012 could not be deducted from their salary due to technical defects in the e-salary system, but the deceased life assured had already died on 4.5.2012. Therefore, he had no opportunity to deposit the premiums for the months of March and April, 2012 with the opposite parties no.2 and 3. Thus, it is emphatically clear that the premiums for the months of March and April 2012 were not deposited due to fault on the part of the opposite party no.1, but the legal heirs of deceased life assured cannot be made to suffer on that account. Therefore, in view of the law laid down in the aforediscussed authorities the opposite parties no.2 and 3 were liable to pay the claim of the policy to the complainant. Under such circumstances, rejection of the claim of the complainant by the opposite parties no.2 and 3 amounted to deficiency in service on their part.

13.              As a sequel to the foregoing discussion, we accept the present complaint and direct the opposite parties no.2 and 3 to pay the insured amount to the complainant with interest @ 9% per annum from the date of filing the complaint till its realization. We further direct the opposite parties no. 2 and 3 to  pay Rs.5500/- to the complainant on account of mental agony and harassment suffered by him and for the litigation expenses.  This order shall be complied within 30 days from the receipt of copy of this order. The parties concerned be communicated of the order accordingly and the file be consigned to the record room after due compliance.

Announced

Dated: 26.05.2016

                                                                                      (K.C.Sharma)

                                                                                         President,

                                                                             District Consumer Disputes

                                                                             Redressal Forum, Karnal.

                             (Anil Sharma)

                               Member