MR. UTPAL KUMAR BHATTACHARYA, HON’BLE MEMBER.
This is an appeal preferred under Section 15 of the Consumer Protection Act, 1986 by the Appellant/Complainant challenging the order dated 15.11.2016 passed by the Ld. District Forum, Howrah in Complaint Case No. CC/287/2015 allowing the said complaint in part on contest without cost against the Respondents/O.Ps.
In the impugned order, the Respondents/O.Ps were directed to pay within 30 days from the date of the impugned order, an amount of Rs.19680.56 after deduction of surrender charge and service tax as per terms and conditions of the policy which they earlier offered to pay to the Appellant/Complainant.
No compensation was directed to pay by the Respondents/O.Ps in view of the fact that their offered payment was not received by the Appellant/Complainant and, therefore, there was no prima facie deficiency on the part of the Respondents/O.Ps.
The Respondents/O.Ps, however, were directed to pay the above sum to the Appellant/Complainant within the given deadline from the date of the impugned order with interest @ 9% p.a. since the Appellant/Complainant’s entitlement till realization.
The appeal case was accordingly disposed of with liberty to put the impugned judgment and order into execution after expiry of the appeal period.
The facts of the case were that the Appellant/Complainant purchased one insurance policy from the Respondents/O.P. Nos. 1 and 2. The subject policy was having a coverage of 14 years with an annual premium of Rs.20,000/- to be paid. As alleged, at the time of purchase of the policy, an employee of the Respondent/O.P. no. 3 along with the Respondent/O.P. – Insurance Company was instrumental in mis-convincing the Appellant/Complainant of an exaggerated prospect of the policy. What he was allegedly made to understand was that the Appellant/Complainant might discontinue the policy on payment of annual premium @ Rs.20,000/- for successive three years and in that case, he might be entitled to get Rs.1,00,000/- or at the worst, in case of extreme recession, Rs.60,000/- with an added amount of interest accrued on it.
The Appellant/Complainant, being a person of poor literacy, had hardly any capacity to understand the critical terms and conditions of the policy. Also, because of his poor financial conditions, he hardly had any capacity of affording a heavy premium of Rs.20,000/- for long 14 years. Accordingly, as per his understanding, he stopped payment of policy premium after 3rd instalment being paid.
The Appellant/Complainant prayed for getting back his own money amounting to Rs.60,000/- paid for successive three years @ Rs.20,000/- per year as per his entitlement which he needed for treatment of injuries he received in an accident. To his utter surprise, the Appellant/Complainant came to know that he was mis-convinced by the agents of the Respondents/O.P. Nos. 1 and 2 given an exaggerated presentation highlighting the policy prospect for selling the same. The policy, as he came to know, was a long life policy needing payment of high annual premium of Rs.20,000/- for 14 successive years. The Appellant/Complainant’s approach for surrendering the policy was responded to by the Respondent/O.P. No. 2, with an advice for continuation of policy upto 5th premium to evade surrender charge.
The Appellant/Complainant’s subsequent prayer for refund of his invested amount of Rs.60,000/- with interest accrued on it under his letter dated 17.12.2014 was, however, responded to by the Respondent/O.P. No. 2 in his letter dated 18.12.2014 informing him about the policy’s auto foreclosed due to non-payment of premium. The Appellant/Complainant, however, was offered an amount of Rs.19,680.56 after deducting Rs.1,000/- and Rs.123.06 towards surrender charge and service tax respectively from the fund value of Rs.20,804.16. The Respondents/O.P. Nos. 1 and 2 sent one cheque for an amount of Rs.19,680.56 through “Blue Dart” a courier service of repute, under Courier POD No. 40431336536 to the mailing address of the Appellant/Complainant which was returned undelivered.
The aggrieved Appellant/Complainant then filed the complaint case seeking the refund of Rs.60,000/- he paid as premium with interest and a compensation of Rs.1,00,000/-.
Heard Ld. Advocates appearing on behalf of both sides.
The major points that the Ld. Advocate for the Appellant/Complainant mentioned were that the Appellant/Complainant was not aware of the policy condition. He did exactly what he was told to do by the agents of the Respondents/O.P. Nos. 1 and 2. In fact, as the Ld. Advocate submitted, the agent got his signature on the body of the form and filled subsequently the same on his behalf.
In absence of any knowledge of the policy tidbits, the Appellant/Complainant had no scope of availing himself of the benefit of free look period. In fact, as he continued, the policy papers had never reached the hands of the Appellant/Complainant as the same were sent to the Bank, the Respondent/O.P. No. 3.
As continued, the Ld. District Forum while passing the impugned order did not apply its judicial mind rendering the said order liable to be set aside allowing the prayer of the instant appeal.
The Ld. Advocate appearing on behalf of the Respondents/O.P. Nos. 1 and 2, per contra, submitted that the policy terms and conditions were well explained to the Applicant/Complainant. The Appellant/Complainant, as further submitted, discontinued the payment of policy premium after three years and the policy was accordingly foreclosed. The allegation of mis-selling of policy through misrepresentation of facts, as contended, was having no base to be substantiated.
Further, as continued, the Appellant/Complainant might have availed the scope of changing or closure of policy for the given reasons for non-acceptance within the free look period of 15 days from the date of receipt of the papers. He did not avail the same scope but filed the petition claiming for refund against the auto foreclosed policy due to non-payment of policy premium by him long after the last premium was paid. The complaint itself was, as he continued, time barred in the above perspective.
The Ld. Advocate concluded saying that the Ld. District Forum was very much justified in passing the impugned order which was needed to be affirmed dismissing the instant appeal.
Perused the papers on record and considered the submissions of the Ld. Advocates appearing on behalf of both the parties. The crux of the issue on the instant occasion appeared to be centered around the point as to whether at all the policy was sold to the Appellant/Complainant by the so-called agent of the Respondents/O.P. Nos. 1 and 2, as claimed. In the entire matter, we had not seen any direct involvement of the Respondent/O.P. No. 3 excepting a reference of presence of an employee of the Respondent/O.P. No. 3 at the time of preparation of policy papers or in other words, at the time of issuance of the policy. We are afraid, the Appellant/Complainant had probably meant the said employee of the Respondent/O.P. No. 3 to be the agent of the Respondent/O.P. No. 3.
Regarding mis-convincing the Appellant/Complainant about the prospect of the policy, nothing else than the Appellant/Complainant’s personal declaration was evident either in the case record or in the submission of both sides. The policy was, admittedly, a long term of policy of 14 years with annual premium of Rs.20,000/-. Admittedly, the Appellant/Complainant paid three successive premiums and filed his complaint on expiry of further two years. It was difficult to accept that the Appellant/Complainant ran the policy for three continuous years without knowing the terms and conditions of the policy. Had there been any discontent or reasons for non-acceptance of the policy, the Appellant/Complainant should have availed, the opportunity of free-look period for cancellation or closure of the policy which too he did not do.
Now, the policy is nothing else than an Agreement between the parties concerned. There are catena of decisions of the Hon’ble Apex Court and the Hon’ble National Commission where it has held that whenever there is an agreement, the terms and conditions of the same will be binding upon the parties involved in it.
In the above context, we would like to refer to the decision of the Hon’ble Apex Court in Bharathi Knitting Company – vs. – DHL Worldwide Express Courier Division of Airfreight Ltd., reported in (1996) 4 SCC 794 wherein the Hon’ble Apex Court was pleased to observe, “………that a person who signs a document containing contractual terms is normally bound by them even though he has not read them and even though he was ignorant of their précised legal effect”.
It is also a settled principle of law that once the insured has preferred not to avail the opportunity of free-look period, his subsequent claim for closure of the policy for any mismatch of the policy terms and conditions with those he has been allegedly briefed earlier or those he has contemplated, does not deserve any consideration.
Such being our observation, we are at one with the findings of the Ld. District Forum to the extent of fixation of liability is concerned. We, however, are of the opinion that the Respondent/O.P. No. 3 has no reason to be impleaded with the instant issue and accordingly, exempt the Respondent/O.P. No. 3 from payment of any amount of compensation.
Hence, ordered, that the appeal be and the same is allowed in part on contest without cost against the O.Ps. The Appellant/Complainant is entitled to the amount as offered by the O.P./Insurance Company as per terms and conditions of the contract, being Rs.19,680.56 after deduction of surrender charge and service tax. The prayer of the Appellant/Complainant for payment of compensation is not considered because of Respondents/O.P. Nos. 1 & 2 already offered him the said amount as per contract and he did not accept the same.
The Respondents/O.P. Nos. 1 & 2 are further directed to pay the above sum to the petitioner within 45 days from the date of this order, failing which, a simple interest @ 9% per annum shall accrue to the aforesaid amount from the date of default till the entire amount is fully realized. The impugned order stands modified accordingly.
