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Debayan Nath v/s HDFC Standard Life Insurance Co. Ltd. & Others

    First Appeal No. A/1377 of 2014

    Decided On, 03 May 2016

    At, West Bengal State Consumer Disputes Redressal Commission Kolkata

    By, THE HONOURABLE MR. DEBASIS BHATTACHARYA
    By, PRESIDING MEMBER & THE HONOURABLE MR. JAGANNATH BAG
    By, MEMBER

    For the Appellant: Amalendu Das, Advocate. For the Respondent: Soni Ojha, Advocate.



Judgment Text

Jagannath Bag, Member

The present appeal is directed against the Order, dated 24.09.2014, passed by the Ld. District Consumer Disputes Redressal Forum, North 24-Parganas, in CC Case No. 30/2014, whereby the complaint was allowed in part on contest against O.Ps with cost.

The complaint case, in brief, was as follows :

The Complainant’s father obtained a new insurance policy for his son sometime in November, 2012. He was made to understand by the agent of the OP/ Insurance Company, namely, Mr. Ashis Roy, that two other policies of the Reliance Insurance Company, which had been purchased earlier, not having much development and became obsolete, should be withdrawn and the new policy would be a better one. He was also made to understand that the new policy would be for three years and the policy would be one time in nature . A sum of Rs. 90,000/- was paid by cheque which the said agent of the O.P Insurance Company took along with the existing Reliance Insurance policy with assurance that the Complainant’s father would get back the money within 46 days. The Complainant received the policy document at the end of December, 2012 but found that there were some wrong / incorrect entries regarding telephone number, e-mail I .D. and the terms of the policy. The agent of the O. P. Insurance Company i.e, Mr. Ashis Roy collected the documents and as per his advice the Complainant and the father of the Complainant signed an application for correction of incorrect entries which was handed over to the agent along with the documents received from the O.P. Insurance Company. But neither the policy document nor the amount withdrawn from the Reliance policies were received by the Complainant. The Complainant realised that there was an unfair trade practice on the part of the O.P. Insurance Company. On 18th February, 2013, the Complainant applied to the Manager, H.D.F.C. Life for cancellation of the policy, but the policy was not cancelled. An appeal to Grievance Officer at Mumbai was sent on the advice of the OP. On 10.03.2013, the Complainant resubmitted one complaint along with a copy of General Diary with Titagarh Police Station. But the policy was not cancelled. When the Complainant and his father went to the O. P. No. 3 for redressal of their grievance, they were behaved rudely. In the said circumstances, the complaint was filed with a prayer for refund of premium money amounting to Rs. 90,000/- and also for payment of a sum of Rs. 2,00,000/- as compensation for mental agony and pain and unnecessary harassment , apart from litigation cost of Rs. 10,000/-.

The complaint has been contested by the O.Ps who filed, written version, whereby it was contended, inter alia, that the policy was not properly explained to the Complainant who chose the policy under HDFC Standard Life Sampurna Samridhi Insurance Plan and as per the terms and conditions, the Complainant was required to pay yearly premium @ 90,000/- for a period of 11 years. It was also contended that the original policy document was duly received by the Complainant on 11.12.2012. The Complainant retained the original policy document instead of returning the policy within a period of 15 days, i.e., the free look period. It was also contended that the request for cancellation of the policy was sent for the first time through the Complainant’s letter dt. 18.02.2013. The Complainant’s allegation about missale of the policy was not correct. The Complainant was informed that the OPs were unable to cancel the policy and refund the premium as the request for cancellation was not made within free look period . Again, as the 2nd premium fell due in December 2013, the policy reached lapsed status as per the terms and conditions of the Policy. The O.Ps, therefore, denied all allegations of the Complaint and pleaded for dismissal of the complaint.

Ld. Forum below having heard both parties and upon perusal of the materials on record observed that, though a complaint is pending with the Insurance Ombudsman, there was no bar to file complaint before the Consumer Forum and again it was observed that if the Complainant is willing to cancel the policy, he cannot be forcefully restrained from doing the same. Relying upon the statement of the Complainant that he did not get any chance to examine the terms and conditions of the policy, Ld. Forum below allowed the complaint with direction upon the OPs. to refund the premium money after deducting 30% from such premium and also directed the OPs to pay Rs.5000/- as litigation cost within one month from the date of the order, failing which the O.Ps would be liable to pay penalty of Rs.100/- daily till the final payment which would be deposited in the Consumer Welfare Fund.

Being aggrieved by and dissatisfied with the order of the Ld. District Forum below the Complainant / Appellant has come up before this Commission with the present appeal for direction to set aside the impugned order.

Ld. Advocate appearing for the Appellant submitted that the issuance of the policy in question was a missale by the O.P Insurance Company through their agent who made incorrect and wrong presentation about the nature and contents of the policy. The Complainant as well as his father were made to understand that the policy would be a onetime policy upon payment of Rs. 90,000/- only without any further payment of any premium. Again, after receiving the policy document several incorrect entries were found and the agent of the Insurance Company collected the policy documents which were handed over to him on good faith with the belief that the policy documents would be returned after due correction for which an allegation was submitted. But the policy documents were not returned by the Insurance Company or agent on their behalf. Such act on the part of the Insurance Company was surely deficiency in service and negligence in their duty. Ld. Forum below considered the material facts but allowed the complaint with direction upon the O.Ps to refund the premium amount of Rs. 90,000/- after deduction of 30% of the said amount apart from litigation cost of Rs.5000/-. Such deduction, however, was not just and fair. The entire amount of Rs. 90,000/- is refundable by the Insurance Company which should have been considered by the Ld. Forum.

Ld. Advocate appearing for the OP/Respondent submitted that the allegation of the Complainant about missale of the policy in question was not tenable. The Complainant was made to understand about the nature and terms and conditions of the policy before payment of the 1st premium. The policy was not a onetime policy and at no point of time was the Complainant told that the policy duration was for three years only. Everything about the premium frequency, nature of the policy etc., were noted in the policy document and the Complainant being an educated person should have been made himself conversant with those information. After the policy was issued, the prayer for cancellation of the policy was not submitted within the free look period of 15 days from the date of receipt of the policy document. As such, there was no question of cancellation of the policy and the 2nd Premium which fell due in December, 2015 not being paid, the policy reached lapsed status as per terms and conditions of the policy. There was no deficiency in service on the part of the O.P Insurance Company and the impugned order has been passed erroneously by the Ld. Forum below, relying upon the baseless allegations of the Complainant/Respondent. The direction of the Ld. Forum below to refund the premium amount after deduction of 30% is arbitrary and without any reference to the policy terms . The impugned order deserves to be set aside.

We have gone through the Memorandum of Appeal together with copies of the impugned order, the petition of complaint, the written version filed by the O. P. Insurance Company before the Ld. Forum below, the copies of letters dt. March, 2013, 21st March, 2013 and 28th March 2013 among other documents.

The point for consideration is whether the impugned order suffers material irregularity or any illegality.

Decision with reasons

It was the case of the Complainant/ Appellant that he purchased a policy under HDFC Standard Life Sampurna Samridhi Plan from the Respondent with the understanding that the Policy was a onetime Policy and no payment other than Rs.90,000/- would have to be made for subsequent premium.

On the other hand, it was the case of the Respondent Insurance Company that the Policy was a 11-year policy with yearly premium of Rs. 90,000/- each, which the Complainant was informed at the time of offering the policy by the agent. There was no reason for missale with the complainant particularly in view of the fact that the Complainant received policy document after receipt of premium .The policy document was self explanatory in every respect.

The policy document is said to have been received by the Appellant/Complainant at the end of December, 2013, (Page-4, paragraph-8 of the complaint petition), though as per the statement of the Insurance Company corroborated by Postal track report of the envelope issued to the Respondent/Complainant, the envelope was received on 11.12.2012.

Though it is a case of the Appellant /Complainant that there were some incorrect entries in the policy document and the policy document was handed over to the agent of the insurance company , it was not a case of the Complainant that he returned the policy document with a prayer for cancellation of the policy.

As revealed from the materials on record the request for cancellation of the policy was sent vide the Complainant’s letter dt. February 18, 2013. This was a very important fact for consideration by the Ld. Forum below, as such request for cancellation of policy could be sent within the free look period only. There appears to be no elaborate discussion on that aspect of the matter by the Ld. Forum below. Further, there appears to be no proper reason as to why deduction of 30% of the premium money was ordered by the Ld. Forum below. Whether such order of deduction is related to any policy condition has not been hinted at. This gives reason to agitate about the fairness of the impugned order . Since the terms and conditions of a policy are binding upon both the insurer and insured, such terms and conditions should have been given due importance for adjud

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ication of the complaint . We are of the considered view that the Ld. Forum should have been more careful as to if the evidence produced by the OP/Respondents was such as to establish that they acted strictly in terms of the policy in question. Ld. Forum’s direction to deduct 30% of the premium money is not found to have been related to any policy terms or evidence whatsoever. We are inclined to hold that the matter should be referred back to the Ld. Forum below for consideration of the point as mentioned above on the basis of evidence as already filed by the parties concerned or as may further be filed by them. The appeal, therefore, succeeds. Hence, ORDERED That the matter be and the same is sent back on remand to the Ld. Forum below for fresh adjudication giving opportunities of hearing to both parties who may adduce fresh evidence, if any, in their respective support. The impugned order is set aside . Parties to appear before the Ld. Forum below on 27.05.2016 for further order. There shall be no order as to costs. Copy of this order be sent to the Ld. Forum below for information in advance.
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