IN THE DISTRICT CONSUMERS’ DISPUTES REDRESSAL FORUM AT MYSORE<br /> <br /> PRESENT: 1. Shri.M.G.Hiremath<br /> B.Sc., L.L.B (Spl.)- President<br /> <br /> <br /> 2. G.V.Balasubramanya<br /> B.E., LL.M - Member<br /> <br /> CC 185/06 DATED 31-10-2006<br /> <br /> Complainants 1. Rachamma W/o Siddashetty,<br /> 2. Siddashetty, S/o Venkata Shetty, Both are R/o Hirikati Village, Begoor Hobli, Gundlupet Taluk, Chamarajanagar District.<br /> (By Sri. Syed Amzad, Advocate)<br /> Vs. <br /> Opposite Parties 1. The Divisional Manager and Authorised Signatory, United India Insurance Co., Ltd., Divisional Office I, 1134, Chamarajapuram, Mysore (Karnataka).<br /> 2. Division Manager, United India Insurance Co., Ltd., Main Division Office III, Kolkata Dakshinapan, II Floor, Garhal Road, (South), Kolkata – 700 068. <br /> (By Rama Devi., Advocate for O.P.1 & O.P.2 Deleted)<br /> <br /> Nature of complaint : Deficiency in service<br /> Date of filing of complaint : 29.06.2006<br /> Date of appearance of O.P. : 18.07.2006<br /> Date of order : 31-10-2006<br /> Duration of Proceeding : 3 Months 11 Days <br /> <br /> <br /> <br /> <br /> <br /> PRESIDENT MEMBER<br /> <br /> Sri.G.V.Balasubramanya,<br /> Member,<br /> <br /> 1. The Opposite parties have entered into an arrangement with M/s Indian Oil Corporation Ltd., and have extended a personal accident insurance scheme called Servo Suraksha Group Personal Accident Insurance wherein every buyer of 20 liters or more of servo products through a single cash memo/bill would be entitled to be covered against personal accident for Rs.1 lakh for a period of one year from the date of purchase subject to a maximum of Rs.10 lakhs.<br /> <br /> 2. One Mahadeva son of the complainants had been covered by Servo Suraksha Policy from 2-6-2003. He met with an accident and died on 1-7-2003. The complainants lodged a claim through one N.Nandakumar, their relative. But the claim was not settled. Even a legal notice issued on 4-4-2006 was not answered. Hence, this complaint has been filed. The complainants have claimed the insurance amount with interest from 5-1-2004 and damages of Rs.20,000/-.<br /> <br /> 3. The 1st Opposite party is the insurance company which has the insurance arrangement with M/s Indian Oil Corporation. The Opposite party has denied that the policy described by the complainants was issued. The Opposite party has pledged ignorance about the death of complainants’ son. Every other allegation in the complaint has been denied.<br /> <br /> 4. From the above contentions, the following points arise for our consideration:-<br /> a. Whether the complainants prove that their son had a valid personal accident insurance policy at the time of his death?<br /> b. Whether the complainants prove that the Opposite party has caused deficiency in service by not settling the claim?<br /> c. What relief or order?<br /> 5. We have answered the above points as under:-<br /> a. Point 4(a) : In the affirmative.<br /> b. Point 4(5) : In the affirmative.<br /> c. Point no.4(c) : As per final order.<br /> <br /> REASONS<br /> <br /> 6. Point no. 4(a):- The scheme of the insurance has been discussed already. A photocopy of the insurance certificate No.61484 is produced. The name of the insured is shown as Mahadeva S/o Siddashetty. The insurance certificate is signed by one Mahadeva Prasad, Proprietor of M/s Karthika Deepa Automobiles, as the dealer selling the Servo product manufactured by M/s Indian Oil Corporation. The cash memo number is mentioned as 380 to evidence the sale of servo product. The only discrepancy on the certificate is the signature of insured. At the place where the insured has sign, one N.Nanda Kumar has signed instead of Mahadeva.<br /> <br /> 7. A photocopy of the filled up claim form is produced. Here, also, though the name of insured is shown as Mahadev, at the place where the insured has sign, the same N.Nanda Kumar has signed. Of course, Mahadev could not have signed the claim form as he was already dead.<br /> <br /> 8. The Opposite party has issued a list of ‘Dos and Don’ts’ to the dealer who issues the insurance certificate to the purchases of Servo product. The very first responsibility cast on the dealer is to ensure that the insurance certificate is properly filled up. Among the other instructions the one which is relevant is that the cash memo issued by the dealer must bear the name of the customer. Anyway, these instructions are to the dealer and it is obvious that a very heavy responsibility is cast upon him as blank insurance certificates will be with him and the Opposite party has to implicitly trust the dealers.<br /> <br /> 9. Now, despite the blank denial of all allegations, the Opposite party has undertaken an investigation to check the varacity of the claim of the complainants. He has produced a letter from M/s karthika Deepa Automobiles and the investigation report of his investigator, Shri K.S.Prasanna. Apparently the Opposite party undertook the investigation because Late Mahadeva had not signed on the insurance certificate. Instead one Nanda Kumar had signed. M/s Karthika Deepa Automobiles is the dealer who has issued the insurance certificate. In his letter, the dealer has stated that he had issued a bill and an insurance certificate bearing No.61484 to Mahadeva S/o Siddashetty on 02-06-2003. He has also stated that the bill belonged to M/s Veekay Agencies and he issued it because he did not have KST (Karnataka Sales Tax) registration. The dealer has admitted that he does not have bill book. This fact is corroborated by the Opposite party’s investigator.<br /> <br /> 10. About issuing the insurance certificate to Mahadeva, this is what the investigator has got to say –<br /> “ In this connection, I visited M/s Karthik Deepa Automobiles at Nanjangud. According to Mr.Mahadev Prasad, Proprietor of the Automobiles he was running the shop for the past 2 years without KST and CST registration and hence, he had not printed cash memo books till date. He was issuing a quotation bill without any numbers to the customers who demanded bills. Hence, he had issued Servo Suraksha Certificate number 61484 to Mr.Mahadev S/o Siddashetty, resident of Hirehate village and he did not remember whether Mr.Mahadev had signed or thumb impressed in the certificate. He had issued the certificate based on the invoice number 380 of M/s Veekay Agencies, the distributor. However, I obtained a letter duly signed by him stating that he have not printed (Sic) the cash memo book till date and had issued the certificate based on the invoice of M/s Veekay Agencies and the same is enclosed herewith for your reference. He had sent the certificate copies to his distributor and did not have any copies. According to him, he had sold 20 liters of Servo engine oil to Mr.Nanda Kumar, employer of the deceased Mr.Mahadev. I met Mr.Nanda Kumar, beneficiary as per the certificate and enquired about the death of Mr.Mahadev. According to him, he had sent Mr.Mahadev, who was working as lorry cleaner with him to collect money from Hollally village in his scooter Reg.No.KA-09Y 2068 and Swamy was the pillion rider. The oil was purchased for his lorries and since Mahadev was his lorry cleaner, he had taken the certificate in the name of Mr.Mahadev.”<br /> <br /> 11. The investigator having categorically concluded that the deceased Mahadev purchased Servo products on behalf of his employer Nanda Kumar strangely concludes that there was no evidence that M/s Karthik Deepa Automobiles sold Servo oil to Mr.Mahadev or Nanda Kumar on 2-6-2003. No proper reason has been cited for coming to this conclusion. If according to him no servo product was sold either to Mahadev or Nanda Kumar, how did the insurance certificate came to be issued? It is no body’s case that the certificate is a forged or concocted piece of paper. Not is the Opposite party saying that Nandakumar had accompanied Mahadev at the time of purchase.<br /> <br /> 12. The version of the Opposite party is totally bland. Except denying all the allegations, he has not given any explanation to the documents produced by the complainants. The very issuance of policy is denied. Similarly, the lodging of the claim is also denied. Yet, an investigator has gone the complainants’ village to check the claim. <br /> <br /> 13. Hence, is now established that deceased Mahadeva purchased servo product on 2-6-2003 from M/s Karthik Deepa Automobiles. Whether he purchased it for himself or for his employer Shri Nanda Kumar is immaterial as the person who purchases at the counter is entitled to insurance. The scheme of servo suraksha does not state that even if the employee purchases, the employer alone is entitled for insurance. Anyway, neither can we impute any knowledge to the dealer that the purchaser is purchasing for his employer nor can we expect the purchaser to reveal such a fact to the dealer. It is not mandatory. In such a case, for every purchase, the dealer will have to put a question to the purchaser as to whether he is purchasing the servo product for himself or his friend or employer, etc. The other question is whether M/s Veekay Agencies being distributor had the authority to handover blank insurance certificates to M/s Karthik Deepa Automobiles who did not have valid Sales Tax Registration. But this will also not affect the claim. The only key ingredient in this scheme is, purchase of 20 liters of servo products to become entitled to insurance. The cash memo/bill is only meant to evidence such purchase. Here, we have evidence of purchase by way of a letter of M/s Karthik Deepa Automobiles and investigator’s report. The arrangement interse between the Opposite party as insurer and Indian Oil Corporation and its Dealers will not affect the end client. Signature of Shri Nanda Kumar at the place, where Mahadeva should have signed is purely due to the negligence of the dealer. We have sufficient evidence to conclude that it was Mahadeva who physically purchased servo products from M/s Karthik Deepa Automobiles on 2-6-2003 and was therefore entitled to the benefit of Servo Suraksha insurance policy. Hence, we answer the point in the affirmative.<br /> <br /> 14. Point no.4(b):- In their legal notice dated 4-4-06 the complainants have stated that the claim was lodged to the Kolkotta office of the Opposite party. The complainants had arrayed the Kolkotta office as 2nd Opposite party but this Forum held that the 1st Opposite party represents the 2nd Opposite party adequately. It is obvious that the Opposite party has received the claim form. Otherwise no investigation would have been initiated by the Opposite party. But there is no record of any intimation to the complainants of having rejected the claim. The investigation report is dated 26-07-2004 and even two years later the complainants have not been intimated about the acceptance or rejection of the claim. This attitude is understandable. When the Opposite party has denied issuing the insurance certificate before this Forum, one cannot expect them to communicate anything to the complainants. The Opposite party could have ascertained the facts from his Kolkota office. The complainants on their part have submitted sufficient material to the consideration of the Opposite party to consider their claim. After all what is necessary to process the claim is the evidence that when the death occurred due to accident Mahadeva had Servo Suraksha Policy. The FIR, Mahazar, the cash bill and policy certificate are sufficient documents to process the claim. As the Opposite party has failed to communicate the fate of the claim and not settled it, we treat it as deficiency in service. Hence, we answer the point in the affirmative.<br /> <br /> 15. Before we part with this order, we deem it essential to place on record our observations on the scheme. It is obvious that the scheme “Servo Suraksha Personal Accident Insurance” is meant to promote sales. But entrusting blank insurance certificate in the hands of people who cannot fill up the certificates properly and who do not understand the consequence of improper filling, is extremely dangerous. In the instant case, the dealer has not at all obtained the signature of Mahadev as insured whereas as he has written Mahadeva’s name as insured. The ‘do and don’ts’ list circulated by the Opposite party to the dealers obviously has had no effect. The ‘dos and don’ts’, the policy certificate, the claim form, etc. are all in English and it would be wishful to expect all dealers in semi-urban and rural areas to understand these instructions. We do not know who has filled the claim form. But Nanda Kumar has signed both as insured and beneficiary. According to the Opposite party’s investigator, Mahadeva was an illiterate. It is unfortunate that the Opposite party did not foresee the consequences of entrusting the scheme in the hands of such dealers. <br /> <br /> 16. If one takes a look at the citations placed before us, the futility of such schemes can be understood. This is a scheme far from being perfect. The Opposite party can escape the liability for a mistake committed by the dealer while filing up the insurance certificate. The learned counsel for Opposite party has placed before us 3 decisions related to Servo Suraksha two of which are from District Forums and one by the Ombudsman. There is also a letter from one of the Opposite party’s office written to one Smt.G.Jhansi repudiating the claim under Servo Suraksha. The first is a decision of Nalgonda District Forum. It is observed that the Opposite party in that case had raised an objection about the collusion between the complainant and the dealer after the death of the purchaser of Servo product. Hence, the Forum relegated the matter to Civil Court. In the other decision of Udupi Forum, the Opposite party has taken a similar contention. He has also, taken a further contention that the cash memo and the insurance certificate issued by the dealer are not genuine. The District Forum came to the conclusion that the dealer is a necessary party. In the instant case, there is no such dispute. The dealer M/s Karthika Deepa Automobiles has categorically stated that he sold 20 liters of Servo oil to Mahadeva. The investigator has verified that the said dealer issued the insurance certificate No.61484 to Mahadeva. And, the Opposite party has not questioned the genuiness of these documents. In fact, he has not questioned any of the documents but has merely denied everything. The last decision cited is from the Ombudsman. Though we are not guided by his decision, we would like to state that the cash memo in that case stood in the name of the owner of the truck for whom the deceased purchased the servo product. The dealer, however, issued the insurance certificate in the name of the buyer/deceased. The Ombudsman has held that the deceased did not purchase the servo product. We are unable to accept this conclusion. It is nowhere mentioned in the scheme that if an employee purchases then the policy goes to the employer. So far as the benefit is concerned it goes to the person whose name appears on the insurance certificate. What is important is the name of the purchaser in the cash memo and on the certificate of insurance. Unless defined otherwise a purchaser is one who tenders the consideration for buying the goods. Whether he is buying it for himself or someone else is immaterial unless it is made clear in the terms and conditions of the policy. The dealer can not be imputed with the knowledge of who the real purchaser is. This is another reason why we say the scheme is far from being perfect.<br /> <br /> 17. Though not pressed by the Opposite party, we have given our anxious consideration to the necessity of the evidence of the proprietor of M/s Karthika Deepa Automobiles Shri.Mahadev Prasad and Shri.Nanda Kumar we find it not necessary. The Opposite party has not even produced the original claim papers and insurance certificate. The copy of insurance certificate produced by the complainants is the copy of the insured. It is now certain that the insurance certificate was issued without Mahadeva signing on it. Nanda Kumar signed on the certificate after Mahadeva gave it to him. Nanda Kumar did not realize that the insured’s name had already been entered in the certificate. If Nanda Kumar himself had gone to purchase, the dealer Mahadev Prasad would have entered Nandakumar’s as insured. So far as the evidence of Mahadev Prasad, it feet it is not necessary because the Opposite party’s own investigator has obtained a letter from him stating that he sold servo product to Mahadev.<br /> <br /> 18. We have to examine the scheme with reference to section 115 of the Evidence Act, which defines estoppel. It is clear that by issuing a certificate of insurance with his name written on the certificate, Mahadeva was made to believe that he had obtained a Personal Accident Insurance Policy. A contract of insurance by nature being an unilateral contract and a contract of adhesion does not require the signature of the insured on it. The scheme introduced by M/s Indian Oil Corporation was to promote sales and as such a purchaser of 20 liters or more of servo product becomes entitled for accidence insurance. The insurance certificate has to contain sufficient information to identify the insured. They are the name of the insured, his age, name of the father, and address. When an insured dies, the question of comparing his signature with the signature on the insurance certificate does not arise. It is a contract of indemnity and as such the Opposite party is bound to pay the person whose name appears as ”Insured” on the insurance certificate. Even while filling in the claim form Nanda Kumar has not realised in whose name the insurance stood. <br /> <br /> 19. Before we conclude, we would like to sum up the reason for allowing this complaint. Though, Shri.Nanda Kumar has signed the policy certificate as “Insured”, his name appears in the nominee’s column and it is Mahadeva’s name found as “insured”. The letter of M/s Karthika Deepa Automobiles and the investigator’s report are sufficient proof of purchase of servo product by Mahadeva. Even if Mahadeva purchased the servo product for and on behalf of Nanda Kumar his employer it does not become material in the absence of any special meaning to the word “Purchaser”. We cannot expect that the dealer to know that the person standing across the counter was only an agent and he was buying the servo product for and on behalf of the principal. Lastly, the purchaser cannot be denied the benefit either for the mistakes committed by the dealer or for the loopholes in the scheme. During the pendency of the complaint, the second complainant died. Hence, the first complainant alone has proceeded. Since the date of lodging the claim is not revealed, we take it as 1-10-2004 i.e. 2 months from the date of investigator’s report.<br /> <br /> 20. With these observations, we proceed to pass the following orders.<br /> <br /> ORDER<br /> <br /> A. Complaint is allowed.<br /> B. The Opposite party is directed to pay to the 1st Complainant insurance amount of Rs. 1 lakh with interest thereon at the rate of 8% p.a. from 1-10-2004 till payment of entire amount after obtaining necessary documents from him.<br /> C. The Opposite party is further directed to pay to the 1st complainant cost of Rs.2,000/-. <br /> D. Supply free copy of this order to each party as per Rules.<br /> <br /> (Dictated to the Stenographer, transcribed by her, transcript revised by us and then pronounced in the open Forum on this the day 31st October 2006)<br /> <br /> <br /> <br /> <br /> <br /> (M.G.Hiremath) (G.V.Balasubramanya)<br /> President Member<br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br />