Punjab

Ludhiana

CC/16/793

Sarthak Kapoor - Complainant(s)

Versus

LIC of India - Opp.Party(s)

Sunil Kapoor Adv.

24 Jul 2018

ORDER

DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, LUDHIANA.

                                                         Complaint No: 793 dated 11.11.2016.                                                                          Date of decision: 24.07.2018

                  

Sarthak Kapoor aged 19 years son of Sh.Sunil Kapoor son of Sh.Ram Nath Kapoor son of Sh.Gurmukh Dass son of Sh.Saudagar Mal son of Sh.Larrdikka Mal son of Sh.Sauhneiyya Mal, resident of Block-1, House No.631/09, Kundanpuri, Civil Lines, Ludhiana-141001 State of Punjab, India.                                                                                                                                         ..…Complainant                                                            Versus

1.Life Insurance Corporation of India, Unit-V, Clock Tower, Ludhiana through its Branch Manager.

2.Life Insurance Corporation of India, Divisional Office, Urban Estate, Phase-I, Ludhiana through its Divisional Manager.

3.Life Insurance Corporation of India, 5^th Floor, West Wing, Yogakshema, PB No.19953, Jeevan Bhima Marg, Nariman Point, Mumbai-400021 through its Chairman/Managing Director.

                                                                                      …..Opposite parties

            Complaint under Section 12 of Consumer Protection Act, 1986.

QUORUM:

SH. G.K. DHIR, PRESIDENT                                                                      SH. VINOD GULATI, MEMBER

COUNSEL FOR THE PARTIES:

For complainant   :         Sh.Sunil Kapoor, Authorized representative of

complainant in person.

For OPs                :         Ms.Anju Khullar, Advocate

ORDER

PER G.K. Dhir, PRESIDENT

1.                Father of complainant being proposer took a life insurance policy bearing No.161225696 for complainant, so as to save for future expensive study of complainant. Sum assured was Rs.1 lac and premium payable quarterly was Rs.1541/-. The policy was known as term 113/25/17. Burden of payment of premium under the policy to cease on attaining of majority by the complainant. A payment towards survival benefit @20% of the sum assured was payable on the 1^st policy anniversary after attaining of majority by the complainant. First survival benefit of Rs.20,000/- was due towards the complainant on 15.02.2016. Complainant attained majority on 1.11.2015. Complainant received letter dated 22.06.2015 from Ops for mandatory registration under NEFT (National Electronic Fund Transfer) of Government of India for settling claims/benefits payable by Ops. Thereafter, complainant submitted duly signed NEFT Form along with Photostat copy of first page of his bank passbook for complying with the term of letter dated 22.6.2015 through branch unit (OP1) under Diary/Inward No.PH/2015/008260/OS dated 30.6.2015. Though more than one calendar year has elapsed, but Ops did not comply with the mandatory requirement of registration of policy in question with NEFT till date. So, there was intentional delay of more than two months on the part of OP1 in remitting the survival benefits to the complainant. Said survival benefits were remitted to the complainant through cheque received on 12.4.2016. Had the policy been registered well in time with NEFT, then delay in remitting of survival benefits would not have  taken place. Ops did not give interest accrued on the above said survival benefits for the delayed period of two months. It is claimed that as per today’s scenario, matter of getting admission to various degree courses after completion of 10+2 stream requires to be started in anticipation. As financial condition of complainant is not sound, so he has undergone immense mental stress due to paucity of funds at his disposal. Numerous visits to OP1 did not entail any consequences. Despite sending of email dated 14.10.2016 nothing is done by Ops. It is claimed that Ops have violated the guidelines laid down by IRDA with regard to the registration of the policy under NEFT, which amounts to an unfair trade practice and that is why this complaint for seeking direction to Ops for registration of above mentioned policy under NEFT scheme. Interest on amount of Rs.20,000/- for delayed period of two months calculated at 2% above the rate, on which Ops charges from its policy holders also sought along with compensation of Rs.4 lac and litigation expenses of Rs.11,000/-. Exemplary and punitive costs of Rs.80,000/- more claimed.

2.                Ops in the joint submitted written reply pleaded interalia as if complainant has not approached this Forum with clean hands and complaint being vexatious deserves to be dismissed under section 26 of the Consumer Protection Act, more so when no case of deficiency of service made out. Father of complainant namely Sh.Sunil Kapoor is agent of LIC and he purchased the policy for complainant. Father of complainant was fully aware of terms and conditions of policy and the requirement of needed documents. All the policy documents were received by the complainant. It was the duty of complainant to supply the NEFT particulars. Those were supplied by the complainant himself, when he was minor. However, as per the policy condition, only purchaser is eligible for registration of NEFT during minority of life assured. So, NEFT was not registered at that time. After the amount became due, wait for submission of NEFT particulars                 by the complainant on attaining of his majority was made, but those were not submitted and    that is why the amount was sent to the complainant through cheque. So, there is no negligence on the part of LIC. Amount has already been paid as per the terms and conditions of policy. Claim alleged to be filed with ulterior motive and malafide intention of harassing Ops, so as to extract money from them without any valid cause. Admittedly, the policy in question was purchased with DOC as 15.02.1999. Table term even admitted. However, the policy was purchased by Sh.Sunil Kapoor on the life of Tushar Kapoor, the minor. Later on, the name of minor was changed to Sarthak Kapoor. As per directions of the Ministry of Finance, Government of India, all payments to be released through NEFT to the policy holders. Letter dated 22.06.2015 was sent to the complainant. NEFT particulars were sent by the complainant Sarthak Kapoor during his minority, despite the fact that father of complainant being proposer was eligible for registration of NEFT. Necessary requirements of policy were not complied by the complainant. Vide letters dated 10.11.2015, 20.01.2016 and 3.2.2016, Ops informed the policy holder to get his NEFT registered. Lapse was on the part of policy holder in not getting the NEFT registered in time. Despite this lapse, competent authority permitted for preparation of the  cases for which, NEFT has not been registered. That permission was granted vide letter dated 29.03.2016 and immediately thereafter, cheque dated 31.3.2016 was prepared and then dispatched on 09.04.2016. That cheque was encashed by the policy holder on 15.04.2016. Each and every other averment of complaint denied by claiming that complainant is not entitled for any relief as prayed    by the complainant.

3.                Father of complainant Sh.Sunil Kapoor, being representative tendered in evidence his affidavit Ex.CA along with documents Ex.C1 to Ex.C18 and thereafter, closed the evidence.

4.                On the other hand, counsel for Ops tendered in evidence affidavit Ex.RW1/A of Sh.Krishan Kumar Arora, Manager Legal of OPs along with documents Ex.R1 to Ex.R5 and then closed the evidence. 

5.                Synopsis of written arguments submitted by the complainant, but not by OPs. Oral arguments of representative of complainant and counsel for Ops heard. Records gone through carefully.

6.                Undisputedly, the LIC policy in question was purchased by the complainant through his father with date of commencement as 11.02.1999 and that fact even borne from the contents of copy of policy schedule Ex.C1=Ex.R1. Date of birth of Tushar Kapoor is mentioned as 1.11.1997 both in Ex.C1=Ex.R1. However, later on name of Tushar Kapoor got changed to Sarthak Kapoor also is a fact borne from the contents of Ex.C1=Ex.R1. In view of this, it is obvious that complainant was to attain majority on 1.11.2015, after being of age of 18 years. Undisputedly, the survival benefit was payable immediately after the completion of 18 years of age on the first policy anniversary year of life assured. In view of this, it is admitted by the complainant in the complaint itself that survival benefit was payable to complainant on 15.02.2016 i.e.after the first anniversary year immediately after completion of 18 years of age by the complainant. However, that survival benefit passed to the complainant by issue of cheque of amount of Rs.20,000/-, which the complainant received on 12.04.2016 i.e. after delay of two months. Interest for  this delay of two months is sought on the amount of Rs.20,000/- by claiming that though the NEFT mandate registration requirements were                            complied with by submission of particulars on 30.6.2015, but despite that the registration under NEFT mandate was not done by Ops. If the date of attaining of majority of the complainant as 1.11.2015 taken into consideration, then certainly it is made out that the request for registration under NEFT mandate was submitted on 22.06.2015 i.e. when the complainant was minor.

7.                After going through conditions and privileges of policy mentioned in Ex.C14, which is also annexed with Ex.R1, it is made out that all moneys payable in terms of these provisions of policy shall if the policy has vested in the life assured, be payable to the life assured, his assigns or nominees under Section 39 of the Insurance Act or proved executors or administrators or other legal representatives etc. Reference to special provision No.3 can be made in this respect. Admittedly, Sh.Sunil Kapoor, father of complainant is the proposer under the policy. As per terms and conditions of the policy under head assignments and nominations, the policy is in no event assignable by the proposer, but after the policy has vested in

 the life assured in terms of Special Provisions herein contained, he may appoint the nominee or nominees, under Section 39 of the Insurance Act, 1938. Further as per special provision No.1 of these terms and conditions, if the life assured is alive on the vesting date and all the premiums due prior to such vesting date have been paid, then the policy will vest in the life assured on such vesting date. So, joint reading of all these terms and conditions provides that the policy in question to vest in the life assured only on attaining of his majority and not before that. Before the date of attainment of majority, the policy is assignable by the proposer subject to certain conditions. Complainant attained majority on 1.11.2015 admittedly and as such, the policy to vest in him w.e.f. this date of 1.11.2015 and not before that. Rather, right of assignment subject to certain conditions remained available to the proposer i.e. father of complainant before 1.11.2015. If that be the position, then complainant after attaining majority on 1.11.2015 could have submitted the NEFT mandate registration form for claiming survival benefits. Contract with minor is not valid is the settled proposition of law and as such, if NEFT mandate submitted by the complainant prior to 1.11.2015, then the said proposal not liable to be accepted by Ops because of contract with minor not a valid one.

8.                Request for NEFT Mandate registration form was submitted on 22.06.2015 as per case of complainant and as borne from the contents of Ex.R3 and as such, it is obvious that request for NEFT registration was submitted by the complainant under his signatures, when he was minor. So, certainly Ops not bound to act upon application Ex.R3 because of complainant being minor at that time and the policy was not vesting in him at that time. So, submission advanced by representative of complainant has no force that Ops adopted unfair trade practice by not registering the NEFT Mandate despite request Ex.C3 dated 22.6.2015.

9.                Section 10 of the Indian Contract Act, 1872 provides that all agreements are contracts, if they are made by free consent of the parties competent to contract. As per Section 11 of the Indian Contract Act, 1872, every person is competent to contract, who is of the age of majority. That age of majority is 18 years and as such it is obvious that when mandate form Ex.R3 was submitted, then complainant was not competent to enter into contract for getting NEFT mandate registered. So, in view of this and in view of the fact that policy did not vest in complainant at the time of submission of Ex.R3, Ops were not bound to register the NEFT mandate on the request of minor, who was not competent to enter into contract. In view of non registration of this NEFT request, cheque dated 9.4.2016 was prepared and the same was dispatched to the complainant is a fact borne from the contents of relevant entry contained in Ex.R4. Receipt of that cheque and encashment thereof even admitted by the complainant in the complaint. So, it is obvious that after getting of sanction from competent authority, the amount was disbursed to the complainant at earliest. So, fault of Ops cannot be found in late payment. Rather, lapse remained on the part of complainant in not submitting the NEFT mandate registration form immediately on attaining the age of majority.

10.              Even if contents of Ex.C7 may be providing that Plan No.113 mainly developed to facilitate provisions for educational expenses of children, despite that fault on the part of Ops cannot be inferred, more so when NEFT mandate registration form not submitted by the complainant after attaining the age of majority. Contents of Ex.C8 to Ex.C10 provides that NEFT registration was not done on dates 26.11.2015, 30.11.2015 and 11.12.2015. If status reports were got by the complainant, then certainly he became aware as if NEFT mandate not registered on these dates by Ops. The policy in question purchased by the complainant through his father, who is an agent of OPs is a fact borne from the contents of Ex.R5, where the name of agent mentioned as Sunil Kapoor. As the policy in question was purchased by the complainant through his father during minority under circumstances that father of complainant himself was an agent of LIC and as such, certainly father of complainant after going through the terms and conditions of policy referred above bound to know as to when the policy to vest in the complainant and as to who remained competent to deal with Ops regarding the policy in question prior to attaining the age of majority by him. So, submission advanced by counsel for Ops has force that as father of complainant, being proposer as well as an agent, was fully aware of terms and conditions of policy and as such it was the duty of father of complainant to get the NEFT mandate registered only after the policy vested in complainant on attaining of majority by him and not before that. Ignorance of law is no excuse and as such, fault lay with father of complainant in not submitting the NEFT registration mandate at the appropriate time.

11.              If in Ex.C4 dated 8.4.2016 or in Ex.C16 dated 29.4.2016 or in Ex.C17 dated 28.5.2016, it is mentioned that registration of NEFT had not taken place,  then the same at the most establishes as if the NEFT registration has not taken place till date. It is not the case of complainant that NEFT mandate form submitted by the complainant after attaining majority, but it is the case of complainant that NEFT Mandate Form Ex.R3 submitted during the minority of complainant. As LIC can enter into a contract with competent person in matter of registration of NEFT and as such, it was the duty of complainant after attaining the majority to submit the NEFT registration mandate form, but no such form after attaining majority submitted by the complainant till date and as such, status of NEFT mandate correctly recorded in the above referred documents like Ex.C4 etc. Receipt of cheque by the complainant on 12.4.2016 under his signatures proved by contents of Ex.C5. As the cheque has been encashed by the complainant himself and father of complainant being an agent, did not call upon the complainant to submit the NEFT mandate as per requirement of Ex.C14, the policy terms and conditions and as such, fault with Ops cannot be at all found. However, registration of NEFT mandate is essential now is an admitted fact and the same even borne by the contents of Ex.C15 and as such, if the complainant applies for registration of NEFT in near future, then it will obligatory on the part of Ops to register the policy in question under NEFT expeditiously. As neither Ops  shown to have        rendered any deficient service and nor they have adopted any unfair trade practice and as such, this complaint deserves to be dismissed, but with the observation that on submission of application for registration of NEFT in near future, Ops will register the policy in question under NEFT expeditiously. Rather, fault lay with complainant in not submitting NEFT registration form after attaining majority, when the policy vested in him and as such, submission advanced by counsel for Ops has force that complaint virtually filed without any cause and may be filed for harassing Ops.

12.              Duty of LIC agent is to prepare the reports, maintain records, seek out new clients and in the event of a loss, help policy holders settle their insurance claims. Some of the agents even are offering their clients financial analysis or advice on ways,the clients can minimize risk. This in fact is borne from the internet extraction, which is made a part of this file. If such are the duties of agents, then the representative-cum-father of complainant, being agent of Ops was bound to help the complainant, as policy holder, for settling the insurance claim expeditiously, but after guiding the complainant that he should submit the NEFT mandate on attaining majority because the policy to vest in him only after attaining majority. That duty has not been performed by father of complainant as an agent and as such fault lay with father of complainant as agent in not guiding the complainant properly.

13.              As a sequel of above discussion, complaint dismissed, but with observation that in case complainant applies for registration of NEFT in near future, then it will be obligatory on OPs to register the policy in question under NEFT expeditiously. Copies of order be supplied to parties free of costs as per rules.

14.              File be indexed and consigned to record room.

 

                             (Vinod Gualti)                                    (G.K. Dhir)

                              Member                                            President

Announced in Open Forum.

Dated: 24.07.2018

Gurpreet Sharma