Heard learned counsel for the appellant and learned counsel for respondent No.2.
2. Respondent No.1 is absent in spite of service of summon sufficient.
3. This is an appeal filed u/s 15 of the erstwhile Consumer Protection Act, 1986 (hereinafter called the ‘Act’). Parties to this appeal shall be referred to with reference to their respective status before the District Forum.
4. Learned counsel for the appellant submitted that the appellant being the complainant alleged before the learned District Forum that his late father Sadasiba Panda has got “Baroda Jeevan Surakhya Saving Bank Account” bearing No. 23430100005829 in the Bank of Baroda where there is scheme namely “Jeevan Surakhya” opened. Complainant has alleged that OP NO.1 has got liaison with OP No.2 Insurance Company for which Sadasiba Panda purchased the life assured policy of Rs.5.00 lacs in the year 2011 under said “Jeevan Surakhya Scheme” which is to be renewed in every year and in that policy OP No.1 became the master policy holder. It is further stated by the learned counsel for the appellant that complainant’s father paid the premium in the year 2011 & 2012 but unfortunately he expired on 24.2.2013. In the year 2011 & 2012 on the request of the deceased life assured, premium has been deducted from the account of the deceased and credited to the account of OP No.2 Insurance Company. It is the case of the complainant that each and every year the premium is to be automatically deducted from the account of the deceased and credited to the account of the Insurance Company. However, it is stated by the learned counsel for the appellant that after death of his father, he informed the concerned Bank and Insurance Company but they remained silent for quite good time and in 2014, he informed that in 2013 itself the claim has been repudiated for the simple reason that the policy has been lapsed due to non-payment of premium even within the grace period in the year 2013. It is also stated that the complainant made correspondence to revive the policy but the OPs turned deaf ear to the request resulted in filing the complaint before the learned District Forum.
5. Learned counsel for the appellant further submitted that the OPs appeared before the learned District Forum and filed their written version separately from each other. It is the plea of OP No.1 that the deceased assured has admittedly got account maintained in the Bank and also admittedly purchased life insurance policy under “Jeevan Surakhya scheme” and during life time, he has intimated in every year i.e. 2011 – 12 to debit the premium from his account and paid the same to Op No.2 but since in 2013 he did not make any request, Op No.1 has not credited the premium even if after grace period extended by the insurer. On the other hand, OP No.1 has washed his hand of the dispute and thoroughly thrown the burden on OP No.2 by stating that OP No.2 has not asked for payment of premium even after 31.12.2012.
6. Learned counsel for the appellant submitted that OP No.2 filed written version stating that since no premium was received from OP No.1 master Policy holder, as per the terms and conditions of the policy, the policy has been lapsed after the grace period is over. OP No.2 has also stated in the written version that on 5.7.2013, they have been informed about the death of the deceased life assured in 2013 and due to lapse of the policy and non-revival of the same, they have repudiated the claim. So, OP No.2 also submitted that they have no deficiency of service on their part.
7. Learned counsel for the appellant submitted that learned District Forum after hearing both parties passed the impugned order illegally rejecting the complaint on the ground that the complaint is barred by limitation being not filed within two years from the date of cause of action and secondly held that there is no deficiency of service on the part of the OPs. According to him such observation of the learned District Forum is illegal and biased one.
8. Learned counsel for the appellant submitted that learned District Forum has committed error in law by not going through the policy condition as embodied therein and the learned District Forum ought to have considered that OP No.1 is the master policy holder whereas the deceased assured was the member.
9. Learned counsel for the appellant contended that the learned District Forum has not applied the judicial mind to the facts that the letter of repudiation dated 5.7.2013 has not been received by the complainant and subsequently also the correspondence made between the parties has not been taken into consideration by the learned District Forum. Learned District Forum ought to have considered that after getting final letter in 16.6.2016, the complainant filed complaint being the nominee of the assured and the complaint is not barred by limitation being filed within two years from the date of cause of action arises.
10. Learned counsel for the appellant further submitted that learned District Forum without going through the materials on record has passed order by observing that the OPs have no deficiency in their service. He categorically drew the attention of this Commission to the policy condition attached to the policy and submitted to set aside the impugned order by allowing the appeal.
11. Learned counsel for respondent No.2 submitted that the learned District Forum has rightly observed that as the complainant’s father did not request the Bank to transfer the premium amount to OP No.2, OP No.2 did not take any action and as such the policy lapsed. He further submitted that there was balance amount of Rs.2,195.07 in the account of the life assured but the deceased assured did not request to send the premium by debiting from his account, it was also for OP No.1 to deduct the premium and submit the same before OP No.2. For that OP No.2 has no any deficiency of service except following the terms and conditions of the policy and it is clearly mentioned in the policy that if the premium is not deposited within the period or within the grace period, the policy would lapse. Since policy is lapsed, OP No.2 could not do anything in this case. So, he submitted to confirm the impugned order passed by the learned District Forum.
12. Learned counsel for OP No.1 although did not participate, it was averred in written version before the learned District Forum that due to absence of any request from the side of the deceased life assured, the premium could not be deducted and remitted to OP No.2, as such, he has no any deficiency of service.
13. Considered the submission of learned counsel for both sides and perused the DFR including the impugned order.
14. Learned District Forum has rejected the complaint on two grounds. First ground is it is barred by limitation and the second ground is, there was no deficiency of service on the part of the OPs.
15. It is settled in law that complainant has to prove deficiency of service on the part of the OPs. It is admitted fact that the complainant’s father got statement of account with OP No.1. It is also not in dispute that the Bank has allowed the complainant to purchase the life insurance policy under “Jeevan Surakhya scheme” and OP No.1 became the master policy holder. The policy for 2011 shows that the sum assured was Rs.5.00 lacs for the period to cover from 18.7.2011 to 31.12.2011 and premium of Rs.683.54 has been paid. Similarly, certificate of insurance for the period 2012 covering the period from 1.1.2012 to 31.12.2012 shows that premium amount of Rs.1,428.39 has been paid by the master policy holder i.e. Bank of Baroda to OP No.2. It is relevant to note policy condition No.6 which is as follows:-
“xxx xxx xxx
6. Premiums
Missing your premiums
You/Master policyholder have a grace period of 30 days for payment of premiums due.
In the unfortunate event of the member’s demise during the grace period, the master policyholder will receive the death benefit after deducting the premium due for the period that the member was covered.
In case premiums remain unpaid by the end of the grace period, the cover will lapse.
If the master policyholder does not renew the plan on any Annual Renewal Date by paying the premiums then falling due or within the grace period of 30 days, it shall be deemed that the master policyholder has discontinued the payment of premiums and the plan will be cancelled. We will inform you of such discontinuance.”
16. On going through condition No.6 of the policy, it appears that the entire responsibility lies with the master policy holder who is none other than OP No.1. There is also one letter of OP No.1 filed with regard to the key benefit of policy available in the record and it appears that there is no such condition mentioned therein to show that the member deceased assured would request every year to OP No.1 to credit the premium amount to the account of OP No.2. In this regard the affidavit of the complainant is clear. So when there is no any terms and conditions while account is opened with OP No.1 by the complainant and also the terms and conditions of the policy do not speak out the same, it is difficult to hold that the complainant since did not inform for debiting the premium from his account, OP No.1 failed to credit the premium amount to the account of OP No.2. The onus lies on the master policy holder to see that the policy would survive by debiting premium from his account. Had there been no sufficient amount the matter would have been considered otherwise. But when there is admittedly Rs.2,195.07 was available in the account of complainant further on the relevant date, it is not understood why OP No.1 did not cover up the risk by debiting the premium. At the same time, a letter is available on record to show that on 6.12.2012, OP No.2 has informed to OP No.1 stating that the annual renewal date of the policy in question is 1.1.2013. When letter is addressed by OP No.2 altering OP No.1, it is duty of OP No.1 to obtain the letter of request to debit premiums from account of complainant’s father or directly debiting premium amount from account of member (complainant’s father) of the policy to save policy being master policy holder. OP No.1 in its written version with affidavit does not prove to get exempted from its liability except throwing burden on complainant or OP No.2. It has not proved its plea. So the plea of OP No.1 that no request was made by complainant further to debit premium is only deliberate act of exempt from its liability.
17. In view of above discussion, this Commission is of the view that as per the policy condition, the premium was neither deducted within 31.12.2012 nor within grace period of 30 days by OP No.1 in spite of care taken by OP No.2 intimating OP No.1 to keep the policy survived then the responsibility or liability of OP No.2 is far from proof but it is sole deficiency of service of OP No.1 proved. For fault of OP No.1 the policy in the name of the deceased assured lapsed and it should be liable for compensating to the complainant. This aspect was not being considered by the learned District Forum while passing the impugned order. Therefore, in this regard, this Commission does not agree with the view taken by the learned District Forum.
18. So far limitation point is concerned, it appears from the record that there is correspondence going between the complainant and the OPs. It continued up to 2016 and finally a letter is available on record showing that neither OP No.1 nor OP No.2 solved the problem and as such the cause of action arose only when the repudiation of claim was confirmed by the last letter dated 13.6.2016 of OP No.2. Therefore, the cause of action in this case does not start in 2013 as observed by the learned District Forum but actually cause of action arose on 13.6.2016. Hence, the complaint is not barred by limitation being filed within two years from the date of cause of action arose. In this regard also, the view of the learned District Forum is not agreed to.
19. For the forgoing discussion, the impugned order of the learned District Forum is liable to be set aside and is set aside and it is observed that the complainant is liable to be compensated due to deficiency of service on the part of OP No.1. Hence, u/s 14 of the Act read with section 18 of the Act this Commission hereby direct OP No.1 to remove the deficiency of service and pay compensation of Rs.3.00 lacs to the complainant who is nominee of deceased life assured and Rs.50,000/- as cost of litigation. No order of compensation or cost against respondent No.2 is passed as per direction made above.
20. The appeal is disposed of accordingly.
DFR be sent back forthwith.
Supply free copy of this order to the respective parties.
