Punjab

StateCommission

FA/12/887

M/s Birla Sun Life Insurance Company Ltd. - Complainant(s)

Versus

Vishan Kanta - Opp.Party(s)

Sandeep Suri

18 Mar 2015

ORDER

2^nd Additional Bench

 

STATE CONSUMER DISPUTES REDRESSAL COMMISSION, PUNJAB

DAKSHIN MARG, SECTOR 37-A, CHANDIGARH

 

First Appeal No.   887 of 2012

                                                           

                                     Date of institution:  2.7.2012  

                             Date of Decision: 18.3.2015

 

Birla Sun Life Insurance Company Limited, SCF 33, Above SBOP, Leela bhawan Market, Patiala.

Appellant/Op No. 1

                                      Versus

1. Vishan Kanta, widow of Late Hakam Singh, House No. 5, Basant Vihar, Ambala City and also # 21-A, Khalsa College Colony, Patiala.

Respondent No.1/Complainant

2. Amit Aggarwal, Insurance Advisor, Birla Sun Life Insurance Company Limited, SCF 33, Above SBOP, Leela Bhawan Market, Patiala.

Respondent No.2/OP No. 2

 

First Appeal against the order dated 30.4.2012 passed by the District Consumer Disputes Redressal Forum, Patiala.

 

Quorum:-

 

              Shri Gurcharan Singh Saran, Presiding Judicial Member

              Shri Jasbir Singh Gill, Member

    Shri Harcharan Singh Guram, Member

 

Present:-

 

          For the appellant             :         Sh. Sandeep Suri, Advocate

          For respondent No.1        :         Sh. G.S. Sidhu, Advocate

          For respondent No.2        :         Ex.-parte.

 

 

Gurcharan Singh Saran, Presiding Judicial Member

ORDER

The appellant/opposite party No.1 (hereinafter referred as “OP No.1”) has filed the present appeal against the order dated passed by the District Consumer Disputes Redressal Forum, Patiala(hereinafter referred as “the District Forum”) in consumer complaint No. 385 dated 25.5.2011 vide which the complaint filed by respondent No.1/complainant(hereinafter referred as ‘the complainant’) was allowed with a direction to OP No. 1 to refund the amount of Rs. 3,17,348/- alongwith interest @ 10% from the date of investment and also to pay interest at the same rate on the sum of Rs. 1,82,652/- already paid by the OP to the complainant and also pay Rs. 50,000/- by way of compensation and Rs. 10,000/- as litigation expenses.

2.                The complaint was filed by the complainant under the Consumer Protection Act, 1986 (in short ‘the Act’) against the OPs on the allegations that the complainant was a senior citizen retired Government employee. In the year, 2008 he wanted to invest a sum of Rs. 5 lacs for the security of future. The Ops through their agent allured the complainant to invest with them. They promised that the complainant has to make one time payment for which she would get the recurring income and after completion of three years, she would get the invested amount of Rs. 5 lacs alongwith interest and benefits. Believing the word of OP, the complainant made the payment of Rs. 5 lacs to the Ops vide receipt No. 5691995 dated 27.3.2008. However, keeping the complainant in dark, the Ops invested the said amount of Rs. 5 lacs in Gold Plus II – Fund and Gold Plus II – Life Coverage vide policy No. 0001600446. The Ops also asked the complainant to deposit two premiums of Rs. 10,000/- each for continuation of the scheme and the said premiums were paid by the complainant vide receipt No. 13440244 dated 23.4.2009 and 22083670 dated 8/72010. After the expiry of three years when the complainant approached OP No. 1 for the refund of Rs. 5 lacs alongwith incurred benefits, she was shocked to know that she would get only Rs. 1,82,651.75p. She also came to know that Ops deducted the amount ranging from Rs. 6960/- to 9517/- per month alongwith Service Tax from the invested amount, which amounts to deficiency in services on the part of the Ops. The complaint was filed with a direction to the Ops for the refund of Rs. 3,17,349/- alongwith interest @ 18%, pay Rs. 50,000/- for causing deficiency in services, Rs. 20,000/- for harassment and Rs. 10,000/- as litigation expenses.

3.                The complaint was contested by the Ops. Op No. 1 filed the written reply whereas the complaint was withdrawn against OP No. 2 vide order dated 27.7.2011.

4.                Op No. 1 in its reply took the preliminary objections that OP No. 1 has already paid a surrender value to the complainant after surrendering the policy by the complainant as per the terms and conditions of the policy; the complainant had no cause of action to file the present complaint; the complainant had not come to the Forum with clean hands and had suppressed the material facts from the Forum; intricate questions of law and facts were involved, which required lengthy evidence and the matter cannot be decided in summary under this Act, therefore, the parties be relegated to the Civil  Court;  there was no deficiency in services on the part of OP No. 1; Insurance was a contract between the insured and insurer based upon the terms and conditions contained therein and both the parties signed the documents admitting them to be correct, therefore, they were bound by the terms and conditions of the policy; the complainant was not a ‘consumer’; the complainant was stopped from filing this complaint by his own act and conduct, omissions and acquiescence and that the complaint was false, frivolous and vexatious, filed just to harass OP No. 1. On merits, it was submitted that the complainant had applied for Gold Plus II Plan for a sum assured, Rs. 25 lacs offered on life vide application dated 27.3.2008 and had paid a premium of Rs. 5 lacs and policy No. 001600446 was issued on 28.3.2008. The life assured/complainant was given the detailed description about the features of the said policy including all the charges mentioned/levied on the same and was also apprised about the terms and conditions of the said policy and declaration on the application form was duly signed by the complainant. Policy documents inclusive of standard terms and conditions of the policy, right to reconsider notice and the copy of the proposal form, financial statement, benefits illustration, customer declaration form and customer information reports were despatched to the complainant and was apprised of the standard terms and conditions of the policy. Under the terms and conditions of the policy, the complainant had a right to reconsider/Free Look Notice of 15 days. On merits also, it was again reiterated that the complainant had contacted the Advisor of OP No. 1 for purchasing the insurance policy. OP No. 1 disclosed the terms and conditions of all the relevant policies. He opted to purchase insurance policy under Gold Plus-II Plan i.e. Unit Linked Life Insurance Policy for a sum of Rs. 25 lacs, paying term three years, annual premium of Rs. 5 lacs every year for three years and investment fund option as maximiser 100% allocation and benefit period 8 years and application No. A8059307 dated 27.3.2008 was submitted. Complainant was an educated lady and had signed the terms and conditions after going through it and handed over account payee cheque No. 548281 dated 27.3.2008 drawn on Patiala Central Co-op Bank Ltd., Patiala, which was agreed that the amount of insurance policy will be invested in the Capital Market and that the benefit/loss of such investment shall be paid to the complainant. OP No. 1 had handed over the sale illustration of the plan to the complainant on 8.4.2008 and accordingly, declaration was made by the complainant that she had received the sale illustrations; the complainant had paid first instalment of Rs. 5 lacs and purchased a unit linked life insurance plan, which was different from traditional insurance plan. Past performance of any investment was not guarantee of future results because the investment funds are subject to market and other risks. It was denied that OP No. 1 had ever assured that the amount invested by the complainant could be double in three years. The complainant was well educated lady and had understood the terms and conditions in Gold Plus-II Fund coverage and Gold Plus-II Life Coverage Plans. The complainant herself had adopted in reducing the 2^nd and 3^rd instalment from Rs. 5 lacs to Rs. 10,000/-, which she had paid. The complainant on 5.4.2011 had submitted an application related relating to policy cancellation (surrender form) to the Patiala Office of OP No. 1 and OP No. 1 after processing the said application had paid the entire surrender value. The complainant had chosen the plan under the investment fund option as maximiser 100% and the total premium amount after deducting the allocation charges was invested in the debt instruments, money market and cash upto 20% and the remaining in equities and equity related securities a sum of Rs. 6960/- to Rs. 9517/- per month as alleged were deducted as cost of insurance i.e. Policy Administration Charges and Fund Management and Mortality Charges depending upon the age of the life assured and what was the surrender value was paid to the complainant. No deficiency in services on the part of this Op No. 1. Complaint was without merit and it be dismissed.

5.                The parties were allowed by the learned District Forum to lead their evidence.

6.                In support of his allegations, the complainant had tendered into evidence her affidavit Ex. CW-1/A, welcome letter of policy Ex. C-1, renewal premium indication Exs. C-2 & 3, policy account statement Ex. C-4, complicated chronic disease certificate Exs. C-5 & 6, newspaper cutting Ex. C-7. On the other hand, opposite party No. 1 had tendered into evidence affidavit of Mrs. Sreemaya Athikkat Ex. R-1, policy Ex. R-2, proposal form Ex. R-3, agents report Ex. R-4, medical reports Exs. R-5 to 10, PAN copy Ex. R-11, policy information Ex. R-12, format Ex. R-13, surrender form Ex. R-14, Policy Gold Plus II Ex. R-15, certificate Ex. R-16, application number Ex. R-17, nomination form Ex. R-18, application dt. 13.7.2010 Ex. R-19, policy cancellation surrender form Ex. R-20.

7.                After going through the allegations in the complaint, written reply filed by OP No.1, evidence and documents brought on the record, the complaint filed by the complainant was allowed as referred above.

8.                We have heard the learned counsel for the parties.

9.                In the grounds of appeal, it has been argued by the counsel for the appellant that the averments made in the complaint itself show that the money was invested in the share/mutual funds as is clear from para No. 4 in the complaint that after completion of three years, she would got the invested amount of Rs. 5 lacs alongwith interest and benefits that would be incurred due to its investment in shares/mutual funds etc. and investment was admittedly made in the share market, therefore, the policy was a unit linked policy and the value changed from time to time, whatever was the surrender value, it was already paid. In case the complainant had made the investment in the unit linked policies for the purpose of investment then the complainant does not come within the definition of the ‘consumer’. On that point, the counsel for the appellant has referred to III (2013) CPJ 203(NC) “Ram Lal Aggarwalla Vs. Bajaj Allianz Life Insurance Co. Ltd.”. In that case also, the complainant’s policy was a unit linked market policy and such policies are speculative in nature and in those circumstances, the complainant does not come within the definition of the ‘consumer’. The proposal form is Ex. R-3, its terms and conditions are Ex. R-2, which shows that the policy opted for Gold Plus II and  annual premium was Rs. 5 lacs, sum assured Rs. 25 lacs, benefit period 8 years paying period three years. As per Ex. R-13 investment fund option was maximiser and premium allocation 100%, therefore, it was investment fund unit allocation policy, covered under Clause ‘F’ and according to Schedule A, it will be invested in debt investment money market and cash equity and equity related securities according to the terms and conditions Ex. R-2 and in case it is an investment policy then the complainant is not covered under the definition of the ‘consumer’ in view of the judgment referred above. No contrary judgment was referred by the counsel for the complainant.

10.              It was further argued that the surrender value has already been paid by the OPs to the complainant but a question was raised by the counsel for the complainant that how they have calculated the fund value as a sum of Rs. 1,82,652/- whereas the amount invested was Rs. 5 lacs in the first year and Rs. 10,000/- in the 2^nd and 3^rd year. The counsel for the appellant has referred to I (1996) CPJ 228 (NC) “Bihar State Housing Board Vs. Chairman-cum-Managing Director and others” wherein it was observed by the Hon’ble National Commission as under:-

“The dispute in respect of the amount deposited can be settled only by reconciliation of accounts as well as by proof of such deposits by producing counter foils or deposit slips or other evidence. It will also be necessary to go into the Reserve Bank of India’s instructions from time to time laying down the rate of interest payable on such deposits or whether any Bank could deviate from the guidelines issued by the Reserve Bank of India. In our view, it is a fit case to leave the parties to their remedies by way of a civil suit or other remedies as the disputes relates to accounting between the parties.

          In an another case titled Vishal Roadways Vs. Economic Traders (Gujarat) Ltd. (1998) NCJ (NC) 539 the Hon’ble National Consumer Disputes Redressal Commission had taken a similar view by holding that if the dispute between the parties relates to the settlement of the accounts and for balance due on the basis of the accounts, the same does not fall within the ambit of Section 2(1)(c) and (e) of the Act.”

11.              Therefore, in case the counsel for the complainant challenged with regard to the fact how the amount was calculated as Rs. 1,82,652/- as surrender value then it amounts to reconciliation of accounts for which detailed evidence by both the parties is required and in those circumstances, the parties can be relegated to the Civil Court to which the counsel for respondent No.1/complainant had no objection.

12.              In view of the above discussion, keeping in view the factum that the complainant does not come within the definition of the ‘consumer’ and that the dispute between the parties is with regard to rendition of accounts and that question cannot be decided in summary procedure under the Act. Accordingly, the impugned order is set-aside. The parties are relegated to the Civil Court to decide their dispute with regard to the rendition of the accounts.

13.              The period spent while pursuing the complaint before the District Forum as well as in this appeal is excluded for the purpose of limitation as per the law laid down by the Hon’ble Supreme Court in case “Trai Foods Ltd. v. National Insurance Co. and others”, (2004) 13 SCC 656.  

14.              The appellant had deposited an amount of Rs. 25,000/- with this Commission at the time of filing the appeal and Rs. 2,97,235/- in compliance with the order dated 16.7.2012. These amounts with interest accrued thereon, if any, be remitted by the registry to the appellant by way of a crossed cheque/demand draft after the expiry of 45 days, subject to stay, if any, by the higher Fora/Court.

15.              The arguments in this appeal were heard on 13.3.2015 and the order was reserved. Now the order be communicated to the parties as per rules.

16.              The appeal could not be decided within the statutory period due to heavy pendency of Court cases.

 

 (Gurcharan Singh Saran)

Presiding Judicial Member

 

                                                                            (Jasbir Singh Gill)

                                                                                                    Member

 

March 18, 2015.                                                      (Harcharan Singh Guram)

as                                                                                                Member