BEFORE THE CONSUMER DISPUTES REDRESSAL FORUM, ERNAKULAM.

Date of filing : 16/02/2011

Date of Order : 28/11/2011

Present :-

Shri. A. Rajesh, President.

Shri. Paul Gomez, Member.

Smt. C.K. Lekhamma, Member.

C.C. No. 91/2011

Between

And

O R D E R

Paul Gomez, member.

1. The following facts induced the complainants to file this complaint :

The complainants are spouses. Husband (1^st complainant) availed an overdraft to the tune of Rs. 62 lakhs from the 2^nd opposite party. The 2^nd opposite party had made a demand to invest in an insurance scheme of the 3^rd opposite party and when he was pressurized to do so, finally he succumbed to the compulsion and joined in Saral Wealth Plan of the 3^rd opposite party. According to the scheme, he was to invest Rs. 4,00,000/- every year. Recently, when the complainants made an enquiry regarding the present status of their insurance, it was told that the investment of Rs. 4,00,000/- was reduced to 2,00,000/-. It was also known that 35% commission out of the transaction was pocketed by the opposite parties. But the complainant has paid an amount of Rs. 60,000/- as interest on the over draft. Hence this complaint urging upon the Forum to allow various reliefs.

2. In the version filed by the 1^st and 2^nd opposite parties, the allegations are denied. It is true that the 1^st complainant had availed on overdraft. There was no compulsion on the part of the opposite parties to invest in the insurance scheme. He had joined on his own. If the customer invest money with the 3^rd opposite party bank will be given a commission by the 3^rd opposite party. There was a free look period to cancel the engagement, the 1^st and 2^nd opposite parties are not parties to the agreement between the complainant and the 3^rd opposite party. The 1^st and 2^nd opposite parties are not responsible for the loss sustained by the complainant. It is prayed to dismiss the complaint with costs.

3. Notice of the 3^rd opposite party was served, but they chose to remain absent. The complainant was examined as PW1 and Exts. A1 and A2 were marked on their side. No oral or documentary evidence was adduced by the 1^st and 2^nd opposite parties. The complainant filed argument notes. Heard the counsel on both sides.

4. The points deserving resolution are the following :

1. Whether the complainants were compelled to join in the insurance scheme?

2. Whether the 3^rd opposite party's conduct has induced the complainants to join in the scheme?

3. What are the reliefs, if any?

5. Point Nos. i. to iii. :- The complainants in this case are a contractor and his wife. They are subscribers to an insurance scheme under the title Birla Sun Life Insurance Saral Wealth Plan. The spouses invested Rs. 2 lakhs each in their respective policies. The 3^rd opposite party is the promoter of the scheme. Thus on the face of it, the Saral Wealth Plan looks an engagement between the complainants and the 3^rd opposite party. But that is not the whole truth in this case. There are some other functionaries who acted as intermediaries which turns the character of the transaction to a totally different one. Had the complainants and the 3^rd opposite party alone were parties to the transaction, one could have very well come to the conclusion that the complainants have been persuaded by the 3^rd opposite party by depicting a rosy picture regarding the scheme. It has to be borne in mind that the 1^st and 2^nd opposite parties are the Managers of the opposite party bank before whom application for over draft to the tune of Rs. 1 crore was pending for disposal. The real nature of relationship existing between Catholic Syrian Bank and the 3^rd opposite party has been disclosed by the 1^st and 2^nd opposite parties in their version. The tie up between the bank and the insurance company is in the nature of agent in canvassing the customers to join in the insurance scheme operated by the 3^rd opposite party. They have also in their fairness admitted that the bank will be reciprocated for their service by payment of commission at a fixed percentage regulated by IRDA norms. There is no documentary evidence to show that the complainant were induced by the 1^st and 2^nd opposite parties to join the insurance scheme except the deposition of PW1 that the 1^st and 2^nd opposite parties have coaxed and cajoled him to join the scheme. He even asserted that the 1^st opposite party has warned him that the disbursement of OD would be discontinued unless he joined the scheme. It is in this view of the matter, the contention of the opposite parties that a free look period was provided to the complainant to back out from the transaction in case, the same looked untenable to him has to be addressed. Taking into account, the materials on evidence and the admissions made by the 1^st and 2^nd opposite parties it is obvious that the complaints were forced into this scheme pressurizing and adopting the tactics of financial black mailing. Moreover, as contended by the complainants, no businessman in his senses would endeavour to invest in insurance scheme by availing loan from a bank at high rate of interest. Therefore, preponderance of probability is high in this case justifying the presumption that the complainants were driven into the 3^rd opposite party's camp against their will to their disadvantage by the act of dishonesty accomplished by the 1^st and 2^nd opposite parties in connivance with the 3^rd opposite party.

6. Next, we shall turn to the culpability of the 3^rd opposite party in this matter. When on making a glance on Ext. A2 booklet issued by the 3^rd opposite party it is crystal clear that they have given tall claims regarding the returns that may accrue out of their investment. At page 5 of Ext. A2, it is stated that the sum assured is Rs. 1,170,000/-. This assurance would convey the message that the insured could expect rich returns and the amount invested is secured. Except some of these statements, all other terms and conditions are not digestible to an ordinary man. Unfortunately, in the course of one year, four lakhs has diminished into just the half. The 3^rd opposite party has preferred to abstain from the proceedings, giving us the freedom to presume that the said averment is true. The conclusion is inevitable that the 3^rd opposite party has acted hand in glove with the other opposite parties in making the unwilling complainants to invest in unprofitable ventures by taking undue advantage of the peculiar situation where the complainants were in dire necessity of money. Therefore, we hold that the 1^{st ,} 2^nd and 3^rd opposite parties are indictable on account of deficiency of service and unfair trade practice. They are liable to make good the loss incurred by the complainants along with compensation and costs.

7. It is quite conceivable the mental agony undergone by the complainants, when they came to understand that their hard earned money has been drifted away by the 3^rd opposite party in one year and they have been cheated by the opposite parties. Therefore, the complainants are entitled for compensation in addition to refund. In the same way, they are also entitled to get costs of litigation.

8. Accordingly, the complaint stands allowed as follows :

1. The insurance policy taken by the complainants stand quashed and the 3^rd opposite party shall refund Rs. 4,00,000- (Rupees Four lakhs only) to the complainants.

2. The 1^st and 2^nd opposite parties shall pay Rs. 30,000/- (Rupees thirty thousand only) each to the complainants together as compensation for their mental agony.

3. The opposite parties 1 to 3 shall jointly and severally pay Rs. 1,000/- towards costs of litigation.

4. The aforesaid sums will carry interest @ 9% from the date of this order till payment.

The order shall be complied with, within a period of one month from the date of receipt of a copy of this order.

Pronounced in open Forum on this the 28^th day of November 2011.

Sd/- Paul Gomez, Member.

Sd/- A. Rajesh, President.

Sd/- C.K. Lekhamma, Member.

Forwarded/By Order,

Senior Superintendent.

A P P E N D I X

Complainant's Exhibits :-

Opposite party's Exhibits :: Nil

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