Kerala

Idukki

CC/265/2016

Poulose - Complainant(s)

Versus

Branch Manager PanjabNational Bank - Opp.Party(s)

31 Oct 2019

ORDER

DATE OF FILING : 26.9.2016

IN THE CONSUMER DISPUTES REDRESSAL FORUM, IDUKKI

Dated this the 31^st day of October, 2019

Present :

SRI. S. GOPAKUMAR PRESIDENT

SMT. ASAMOL. P MEMBER

CC NO.265/2016

Between

Complainant : Kurian, S/o. Paulose,

Pookkunnel House,

Pothanickadu, Kothamangalam.

(By Adv: P.S. Rajesh)

And

Opposite Parties : 1. The Branch Manager,

Punjab National Bank,

Thodupuzha Branch,

Mariyil Tower, Thodupuzha P.O.,

Idukki.

(By Adv: J. Anil)

2. The Manager,

Oriental Insurance Company Ltd.,

Thodupuzha Branch,

Thodupuzha P.O., Idukki.

(By Adv: Thomas Sebastian)

 

O R D E R

 

SRI. S. GOPAKUMAR, PRESIDENT

 

Case of the complainant is that :

 

Complainant's son Paulsy availed a housing loan from 1st opposite party bank in the year 2012. Complainant also went to the bank along with his son at the time of applying the loan and at that time, the manager of 1^st opposite party bank elaborately discussed the terms and conditions of the loan. At that time, the manager said that they will insure the life of the borrower through a credit assurance policy and the premium of the policy will deduct from the account of the borrower. The speciality of the policy was that of the borrower cause death either naturally or through accident, the insurance company will compensate the 1^st opposite party bank by clearing the loan liability of the deceased insured. For that purpose, 1^st opposite party bank debited Rs.8427/- towards insurance premium from the account of the complainant's son. The further premium will

(cont.....2)

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varies depending upon the outstanding loan amount. While so on 22.7.2016, the son of the complainant died due to cardiac arrest and at the time of filing the complaint, the loan pending dues is Rs.8 lakhs. Eventhough the 1^st opposite party deleted the premium amount from the account of the complainant's son each year, no policy document or premium payment receipts are provided to the borrower. Till the death of his son, the complainant remitted the loan instalments regularly. The sudden death caused much loss and agony to the family of the complainant and hence they are not in a way to remit the balance loan account. After the death of the Paulsy on 1.9.2016, the representatives of 1^st opposite party approached the complainant and demanded the loan dues. The representatives further intimated that if they fails to remit the loan amount, 1^st opposite party will initiate recovery steps against them. Thereafter the complainant approached 1^st opposite party and intimated all these things. At that time, 1^st opposite party replied that they failed to remit the insurance premium from the 2^nd year of the loan onwards.

 

Complainant further contended that credit insurance policy is a protection of the borrower in their loan, when the borrower cause any mishaps. But the non-payment of insurance premium in the case by the 1^st opposite party bank is clear deficiency in service as well as unfair trade practice. 1^st opposite party bank deducted the insurance premium from the account of the borrower and non-payment of it to the insurance company is a clear instance of cheating and it is against the principles of banking as well as insurance law.

 

Alleging deficiency in service and unfair trade practice against the 1^st opposite party in this matter, complainant filed the petition seeking reliefs such as to direct the 1^st opposite party to close the above discussed housing loan and further direct the 1^st opposite party to pay compensation and cost to the complainant for the deficiency in service and unfair trade practice happened on the part of 1^st opposite party.

 

Upon notice, 1^st opposite party entered appearance and filed reply version admitting the sanctioning of housing loan. 1^st opposite party further contended that the loan in question was sanctioned to the complainant and his deceased son jointly. At the time of sanctioning the loan, 1^st opposite party insured the loan account and availed Awasya Rin Bima Kavacha Special Policy from the Oriental insurance company, Thodupuzha branch by paying Rs.8427/- as insurance premium. This insurance policy is valid from 30.5.2013 to 27.5.2023 and it covers the whole building. In addition to it, 1^st opposite party bank availed a personal accident (death and permanent disable) policy by

(cont.....3)

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covering the borrower Paulsy and the complainant by paying Rs.303/- as insurance policy.

 

While so, in the month of August 2016, the complainant approached 1^st opposite party and intimated the matter of death of his son Paulsy and stated his inability to pay the loan amount. At that time, 1^st opposite party replied that if they produce the death certificate of the deceased, they will forward an insurance claim to the insurer and tried to avail the policy amount and at the time of its sanctioning, they will adjust the policy amount in the loan account. But till the date, the complainant failed to produce the death certificate or any application for insurance claim of his son and hence the 1^st opposite party has not submit any claim application to the insurance company. If the complainant submitted any death claim to the 1^st opposite party, they will definitely acted upon it. Hence in that reason alone, no deficiency in service or unfair trade practice can be alleged against the 1^st opposite party.

 

First opposite party further contended that the loan which is availed by the complainant and his son jointly and it was insured with the Oriental insurance company, they are duly bound to honour the claim if any. Hence the insurance company is a necessary party in the company. Otherwise the complaint is bad for non-joinder of necessary party.

 

On getting the information, complainant filed a petition to include the Oriental insurance company as an additional 2^nd opposite party. This petition allowed and 2^nd opposite party, the Oriental insurance company is impleaded and upon notice, 2^nd opposite party appeared before the Forum and filed detailed replay version.

 

In the version, 2^nd opposite party contended that after the death of Paulsy, the complainant or legal heirs of the deceased has not submitted any claim to the 2^nd opposite party for the death of the Paulsy. Hence the petition is not maintainable against the opposite party. Moreover, as per cl.8.11 of the policy, any claim under the policy is to be claimed within one year of the date of occurrence. So far no claim is launched against the 2^nd opposite party, it is barred by limitation.

 

Second opposite party further contended that the 2^nd opposite party is a General Insurance Company and it could not issue a life insurance policy. On request of 1^st opposite party, the 2^nd opposite party has insured a Awasya Rin Bima Kavacha policy bearing No.442600/48/2014/313 for the period from

(cont.....4)

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30.5.2013 to 27.5.2023 in the name of the complainant and deceased Paulsy, to cover fire and allied perils to the insured property and personal accident cover to the complainant and Paulsy for death and permanent disablement. Opposite party further stated that as per the condition of the policy, if the insured (loanee) sustained bodily injury solely and directly caused by accidental means, resulting death, this insurance company is liable to pay to the legal heirs the loan amount ought to have been paid on the date of occurrence. In this case, Paulsy, one of the insured, died due to heart attack. So it is not accidental death. It is natural death, hence the claim for death is not covered by this policy. As per cl.7.4 under general exceptions of the policy, the company is not liable in respect of legal liability of what so ever in respect of death or bodily injury or of any disease or illness to the insured person. Since the death of Paulsy as a result of illness, the claim for death is not covered by policy as per general exceptions of the policy. Therefore 2^nd opposite party is not liable to pay any amount under the policy.

 

The 1^st opposite party was aware of the policy conditions and on misrepresentation made by them, the complainant impleaded the opposite party only to cause hardships to them. As there is no allegation and claim against this opposite party, this opposite party is an unnecessary party to the complainant and hence the complaint is liable to be dismissed against 2^nd opposite party.

 

Evidence adduced by the complainant by way of proof affidavit and documents. Complainant was examined as PW1. Copy of passbook issued by the opposite party in the name of Paulsy Kurian and the complainant and the copy of death certificate of Paulsy dated 12.8.2016 are marked as Exts.P1 and P2 respectively.

 

One Jimmy Mathew, Deputy Manager of 2^nd opposite party examined as DW1. Documents such as copy of housing loan agreement, copy of supplementary agreement, copy of policy schedule having No.442600/48/2014/313, copy of policy schedule, bank statement of account and copy of policy schedule are marked as Exts.R1 to R6 respectively.

 

Heard both sides.

 

The point that arose for consideration is whether there is any deficiency in service from the part of opposite parties and if so, for what relief the complainant is entitled to ?

 

(cont.....5)

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The POINT :- We have heard the counsels for both the parties and had gone through the records. It is an admitted fact that complainant and his son deceased Paulsy availed a joint housing loan of Rs.15 lakhs from 1^st opposite party bank on 16.11.2012. On perusing Ext.R1 agreement for housing loan, it is very clear that the loan agreement was executed by the complainant and his son jointly and as per the banking records, they are the borrowers. Not as a borrower and guarantor. It is an admitted fact that the housing loan was insured with 2^nd opposite party, the Oriental insurance company, Thodupuzha branch for a period from 30.5.2015 to 27.5.2023. On perusing Ext.R3 policy document, it is seen that this policy is issued in the name of Paulsy and Kurian P.P and it covers the total loan amount disbursed to the loanees from fire and allied perils as per section 4 of the policy conditions.

 

As per the version of 2^nd opposite party, the Oriental insurance company, on request of 1^st opposite party, they have issued a Awasya Rin Bima Kavacha Policy for the period from 30.5.2013 to 27.5.2023 in the name of the complainant and deceased Paulsy to cover fire and allied perils to the insured property and personal accident cover to the complainant and Paulsy for death and permanent disablement – solely and directly caused by accident, violent, external and visible means resulting in death as stated herein after.

Hence the death of the son of the complainant, one of the borrower caused by heart attack, as per the cl.4 of the insurance policy, it cannot consider as an accidental death. For establishing the version, the learned counsel for 1^st opposite party argued the matter by relying upon the decision of Hon'ble Supreme Court reported in KHC, 2019 (3) SN 1, (page No.1) (SC), Hon'ble Justice Dr. D.Y. Chandrachud & Hon'ble Mr. Justice Hemant Gupta observed in the case of Alka Shukla (Smt) Vs. Life Insurance Corporation of India, that,

“Death due to fall from scooter, as a result of heart attack – whether entitled for benefit under policy – Held, when assured died as a result of heart attack which was not attributable to accident and when death was not as a result of accident caused by outward violent or visible means, it cannot be said that benefit under the policy can be claimed”

 

In this case, the learned counsel for the 1^st opposite party specifically stated that, eventhough the complainant intimated the matter of death to the 1^st opposite party, in the month of August 2016, no death certificate is produced before the 1^st opposite party. If the complainant produced the record showing the death of his son, the 1^st opposite party bank will initiate necessary steps to claim the policy benefits. On perusing the affidavit and deposition of the complainant, it is seen that he approached the 1^st opposite party with relevant

(cont.....6)

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records proving the death of the deceased Paulsy and he was under the firm belief that the 1^st opposite party bank will proceed for sanctioning the insurance claim. At this juncture, it is very pertinent to note that, the 1^st opposite party bank has not a case that they given the full insurance details and policy certificate copy to the complainant in order to verify the terms and conditions of the insurance policy. From the evidence, it is very clear that the complainant and his deceased son are unaware of the policy conditions except the guarantee of the 1^st opposite party, that if any mishaps happened, their loan will be covered by the insurance policy.

 

The learned counsel for the complainant vehemently argued that the 2^nd opposite party cannot repudiate the claim on the ground that the claim will be sanctioned only in case of accidental death. By relying the decision of Hon'ble Supreme Court of India, in the case of LIC of India and another Vs. Hira Lal, (reported in 2011 KHC 5241), in this decree, the Hon'ble Court held that, “Accident implies something unexpected – It was not shown that blindness or respondent assured claimant was attributable in any manner to him or any act on his part – The respondent is entitled to insurance amount.

 

In this decision, it is further discussed that, as per Mozley and Whitely Law Dictionary, eighth edition 1970, “accident” is defined as follows : “Accident” as a ground for seeking the assistance of a Court of equity, accident means not merely inevitable casualty or the act of God, or as it is called Vis major, but also such unforeseen events, misfortunes, losses, acts, or omissions as are not the result of negligence or misconduct.”

 

The Court further observed that “it is by new well settled that when two interpretations are possible, while examining a case of the present nature, one beneficial to the consumer has to be followed”.

 

In support of the contention of the learned counsel of the complainant, we relying upon the judgement of Hon'ble Supreme Court pronounced in National Insurance Co. Ltd. Vs. Monsumi Bhattacharya II (2019) CPJ 4(SC), it is discussed that – Where a disease is caused or transmitted in natural course of events, it would not be covered by definition of an accident – However, in a given case or circumstances, affiliation or bodily condition may be regarded as an accident where its cause or course of transmission is unexpected and unforeseen.

 

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In the reported decision para 5, the Hon'ble Court discussed the findings of Hon'ble West Bengal State Commission that, “sudden death due to mosquito bite in a foreign land was an accident, it would be rather silly to say that it was a natural death”. In the same matter, the Hon'ble National Commission observed that, “The term accident has not been defined in the policy which the deceased had taken and therefore contextual dictionary meaning of the said term has to be taken for the purpose of deciding whether the death of deceased was due to accident or not. Accident is something that happens unexpectedly and is not planned in advance. It is defined as (i) unpleasant event, especially in a vehicle, that happens unexpectedly and cause injury or damage (ii) something that happens unexpectedly and or not planned in advance, in the Oxford Advanced Learners Dictionary (new 8^th edition). The word accident is defined as “(i) an accident, an unforeseen injuries occurrence, something that does not come in the usual course of event or that cannot be reasonably anticipated (ii) an unforeseen and injuries occurrence due to mistake, negligence, neglect or misconduct and unanticipated and untoward event that causes harm” (in Black's Law Dictionary 9^th edition).

 

On considering the rival contentions and evidence on record, it is found that, the 1^st opposite party bank advanced a loan in favour of the complainant and his deceased son Paulsy. Unfortunately, the Paulsy died due to heart attack and the matter intimated to the 1^st opposite party forthwith as per the deposition of the complainant. But 1^st opposite party objected the contention and stated that the complainant has not produced any evidence regarding the death of one of the borrowers. The contention of the 1^st opposite party cannot be believable, because it is an admitted fact that the complainant intimated the matter of death to the opposite party, we can presume that he intimated the matter along with the death certificate of the deceased Paulsy.

 

Then regarding the issue of the sanction of the loan to the complainant and his deceased son jointly. On perusing the documents, it is seen that the loan is sanctioned to the complainant and his son jointly. But it is the duty of the 1^st opposite party bank to adduce evidence that they sanctioned loan on the basis of the repaying capacity of both the borrowers. Here it is very clear that, eventhough the loan is sanctioned to the father and son, the bank allowed the loan on the basis of the repaying capacity of the deceased son, since he is practising as an advocate and no evidence is produced that the co-borrower, complainant is also having much capacity to remit the EMIs. The issue regarding the sanctioning of the loan to the complainant as alleged by the 2^nd opposite party is unsustainable.

(cont.....8)

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Then regarding the issue of non-payment of insurance claim on the basis of the contention that the borrower died due to heart attack. The version of the learned counsel that the policy covers only accidental death is unsustainable because the word accident is interpreted by the Hon'ble Division Bench of Supreme Court of India in the above discussed judgement. Moreover, we are of the opinion that the insurance companies are constituted to aimed at ensuring that the beneficiaries get them due and legitimate in accordance with law. Moreover, we are reiterating the observation of the Hon'ble Supreme Court in LIC of India and another Vs. Hira Lal that “when two interpretations are possible, while examining the case of a present nature, one beneficial to the customer has to be followed”.

 

Here the Forum is following the view of the Hon'ble Supreme Court in the above discussed case and considered the version of the complainant. It is obvious that eventhough the opposite party bank issued loan jointly, it is persume that it is based on the age and repayment capacity of the deceased Paulsy.

 

On the basis of above discussion, the Forum is is of a considered view that the death of the Paulsy can be considered as an accidental death in view of the above discussed decision and the complainant is entitled to the benefits of the insurance claim.

 

Under the above said circumstances, the complaint allowed. The opposite party bank is directed to stop all the recovery proceedings initiated against the complainant for recovery of the above discussed loan amount and to close the housing loan account, which is the subject matter of this case. At the same time, 2^nd opposite party is directed to honour the claim as per the insurance policy admitted by them, by consider the death of the deceased Paulsy and transfer the claim amount to the concerned loan account of the complainant. No order to cost or compensation.

 

Pronounced in the Open Forum on this the 31^st day of October, 2019

 

Sd/-

SRI. S. GOPAKUMAR, PRESIDENT

 

Sd/-

SMT. ASAMOL. P.,MEMBER

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APPENDIX

 

Depositions :

On the side of the Complainant :

PW1 - Kurian Paulose.

On the side of the Opposite Party :

DW1 - Jimmy Mathew.

Exhibits :

On the side of the Complainant :

Ext.P1 - Copy of passbook issued by the opposite party in the name of

Paulsy Kurian and the complainant.

Ext.P2 - copy of death certificate of Paulsy dated 12.8.2016

On the side of the Opposite Party :

Ext.R1 - copy of housing loan agreement,

Ext.R2 - copy of supplementary agreement,

Ext.R3 - copy of policy schedule having No.442600/48/2014/313,

Ext.R4 - copy of policy schedule

Ext.R5 - bank statement of account

Ext.R6 - copy of policy schedule

 

 

 

Forwarded by Order,

 

 

 

SENIOR SUPERINTENDENT