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Life Insurance Corporation of India V/S Tusar Kanti Nayak.

    Appeal No. 520 of 2005

    Decided On, 10 October 2005

    At, Orissa State Consumer Disputes Redressal Commission Cuttack

    By, MEMBER

    For Petitioner: S.K. Mohanty & Assoc And For Respondents: R.P. Padhy & Assoc.

Judgment Text

1. This appeal is directed against the order dated 24.5.2005 passed by Rayagada District Forum in C.D. Case No. 94 of 2004 requiring the appellant to revive policy No. 570150427 on charging nominal interest. This case was listed for orders on 30.9.2005 to call for the records from the District Forum. On that day Mr. Padhy appearing for the respondent submitted that since he had come from Rayagada he may be heard on merits of the case. Mr. Mohanty, Counsel for the appellant stated that the matter had been listed for orders and he was not prepar

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ed to argue the matter on merit. Mr. Padhy also submitted that he would not be in a position to come on the next date of hearing because of the long distance he had to cover to come to Cuttack. We accordingly heard him on the merit of the case and adjourned the case for further hearing to today.

2. Mr. Mohanty, Counsel for the appellant submitted that the order of the District Forum is not tenable in view of condition No. 3 of the policy.

3. There is no dispute that Policy No. 570150427 was taken by the respondent. The sum assured thereunder was Rs. 50,000. Quarterly premium payable was Rs. 619. The date of commencement of the policy was 28.5.1996 and its date of maturity was 28.5.2016. It is an admitted fact that the last quarterly premium was paid upto August, 1998. Thereafter no premium was paid. The consequence of non-payment of premium is indicated in Condition No. 5 of the policy. It states that in case the premium shall not be duly paid the policy shall be void and all claims to any benefit in virtue thereof shall be ceased. Condition No. 3 is relevant for our purpose. It states that if the policy has lapsed, it may be revived during the life-time of the life assured but within a period of five years from the date of the first unpaid premium and before the date of maturity, on submission of proof of continued insurability for the satisfaction of the Corporation and the payment of all the arrears of premium together with interest at such rate as may be fixed by the Corporation. The revival of a discontinued policy shall take effect only after the same is approved by the Corporation and it specifically communicated to the life assured.

4. It appears from the records that the respondent had earlier filed C.D. Case No. 46 of 2004 in which he claimed refund of the premiums deposited by him. The said complaint was dismissed for default of the respondent. Thereafter he has filed the present complaint (C.D. 94 of 2004) out of which this appeal arises. In this complaint he changed his prayer by claiming revival of the lapsed policy. According to him, due to personal problem and because of his higher education he defaulted in payment of the premiums. He received a letter dated 19.11.2003 from the appellant in which it was stated that opportunity to revive the lapsed policy was being given for the period from 15.11.2003 to 14.12.2003 (Intensive Revival Campaign). But during this period his mother guardian was under treatment at Bissam cuttack Christian Hospital and after completion of her bed rest period, approach was made to the appellant for revival of the policy but the prayer was refused.

5. As we have already noted, under condition No. 3 a lapsed policy may be revived during the life-time of the life assured within a period of 5 years from the date of the first unpaid premium on submission of proof of continued insurability to the satisfaction of the Corporation and payment of all arrears of premium. A life assured can get the benefit of revival of the lapsed policy within a period of 5 years from the date of first unpaid premium provided he submits proof of his inability to pay the premiums and makes payment of all the arrears of premium. In the case at hand the respondent has not paid the arrears of premium nor there is any offer in the complaint to do so. So far as furnishing of proof of inability to make payment, it may be noted that the last premium paid by the respondent was in August, 1998 and the next due was in November, 1998 which admittedly, he did not make payment. The grace period of 5 years lapsed in November, 2003. Therefore, he has to furnish the proof of his inability to make payment from November, 1998 to November, 2003. The only proof furnished in the case was that his mother-guardian was under treatment in the Christian Hospital, Bissamcuttack for the period from 6.9.2003 to 7.8.2003 and was advised to rest till 15.11.2003. The so-called illness of the respondent's mother-guardian, assuming the medical certificate to be true, was for a limited period for only four months in the year 2003. The medical certificate seems to have been obtained only when the appellant issued letter dated 19.11.2003 to the respondent stating that he might avail the opportunity of getting revival of the lapsed policy during the intensive Revival Campaign i.e., from 15.11.2003 to 14.12.2003. In the said letter it was mentioned that policy could be revived if a total sum of Rs. 15,478.20 which includes interest, etc. was paid on or before 15.11.2003. It is an admitted case that the respondent had not paid the said amount by the stipulated date. For all the reasons mentioned above, the District Forum clearly fell into an error directing the appellant to revive the lapsed policy. In the result, the impugned order is set aside and the complaint filed by the respondent stands dismissed. This appeal is allowed. No costs.

Subash Mahtab, Member

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