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Pankaj Mahajan v/s Max New York Life Insurance Company Ltd. & Others

    Appeal No. 135 of 2009

    Decided On, 24 September 2010

    At, Union Territory Consumer Disputes Redressal Commission UT Chandigarh

    By, THE HONOURABLE MR. JUSTICE PRITAM PAL
    By, PRESIDENT & THE HONOURABLE MR. S. JAGROOP SINGH MAHAL
    By, MEMBER

    For the Appellant: Sanjiv Trikha, Advocate. For the Respondents: Rajneesh Malhotra, Advocate.



Judgment Text

Jagroop Singh Mahal, Member:

1. This is complainant’s appeal against order dated 5.2.2009 passed by learned District Consumer Disputes Redressal Forum-II, U.T., Chandigarh (hereinafter to be referred as District Forum) vide which the complaint filed by the complainant was dismissed.

2. According to the complainant, he was approached by Ms. Nishu Garg of OP No. 1 and on her persuasion, took a policy effective from 27.12.2005 with an annual premium of Rs. 1,60,408 under Life Maker Unit Linked Investment Plan. When the policy was received by him, the allocation of funds was not made by the OPs/respondents as per the commitment and discussions held at the time of finalization of the proposal and therefore, the complainant applied for 'free look cancellation' of the policy on 6.12.2006. When he did not hear anything from the OPs/respondents, he served a legal notice dated 21.3.2008 to refund the full amount of Rs. 1,60,408 along with interest but was informed by the respondents that he was liable to pay administration charges, etc. the policy cannot be cancelled and the OPs/respondents decided to deduct more than 55% value of the premium, which was fraudulent and unethical act on their part. The complainant, therefore, issued another notice dated 11.5.2007 (Annexure D) and filed a complaint before the Insurance Ombudsman on 6.7.2007. The Insurance Ombudsman passed an order dated 7.9.2007 but the OPs did not pay back the amount in view of the orders and filed new pleadings before the Insurance Ombudsman on 5.10.2007. The Insurance Ombudsman asked the OPs to pay him Rs. 66,366 as an ex gratia amount, which was released through a cheque dated 11.7.2007. The contention of the complainant is that he suffered a loss of Rs. 94,042 and is therefore, entitled to the refund of the said amount along with interest @ 24% per annum. He also prayed for Rs. 1 lac as compensation for harassment and inconvenience along with litigation expenses.

3. The OPs/respondents opposed the complaint alleging that the premium was invested as per terms and conditions of the policy; that policy is a Unit Linked Policy and there had been no negligence or deficiency in service on their part. It was alleged that the policy was issued on 29.12.2005 and was despatched to the complainant on 31.12.2005. He requested for cancellation on 6.12.2006 after almost one year of the issuance of the policy and therefore, it was beyond the policy review period and it could not be cancelled as requested by the complainant. It was admitted that the complainant filed a complaint before the Insurance Ombudsman who ordered the payment of Rs. 66,366 as ex gratia, which has since been paid to the complainant. It was alleged that the complainant is not entitled to any other amount.

4. Both the parties were given opportunity by the learned District Forum to produce evidence in support of their contentions.

5. After hearing the arguments of the learned Counsel for the parties and perusing the record, the complaint was dismissed vide impugned order dated 5.2.2009, which has been challenged through this appeal.

6. We have heard the arguments of learned Counsel for the parties and have perused the record.

7. The first contention of the complainant is that the premium was not invested by the OPs/respondents as per the commitments and discussion held at the finalization of the proposal. This fact was mentioned by him in Para No. 4 of the complaint. He, however, did not elaborate as to what were the commitments and discussions and what percentage of the premium was to be invested and in which scheme. It is all a vague assertion and on its basis, we cannot say if the premium was not invested as per the commitments. On the other hand, OPs have produced Annexure R-2, which is copy of policy document of the scheme and in view of Clause 6.2, the only target premium was to be allocated in accordance with allocation rate detailed in the table showing that in the first year, the allocation rate for annual target premium after deduction of any applicable taxes was 75%; in the second year it was 80% and in the third and subsequent years, it was 100%. The learned Counsel for the OPs/respondents has argued that they have invested the premium in accordance with this proposal and there was no deficiency on their part. It, therefore, cannot be said if the OPs have not invested the premium in accordance with their commitment.

8. According to Clause 22 of Annexure R-2, the complainant was given 15 days period to examine and review the policy carefully and to request for cancellation within the said period, upon which the premium was to be refunded to him. The learned Counsel for the complainant argued that he exercised the said option through a letter dated 6.12.2006 but the same was not accepted by the OPs/respondents alleging that it was beyond the period of 15 days. The complainant did not mention either in this letter dated 6.12.2006 or in the complaint as to on which date, he had received the policy. Needless to mention that the period of 15 days was to start from the date of receipt of the policy but no such date was given by the complainant in Para No. 4 of the complaint or in this application. The complainant did not even produce a copy of the policy in order to conceal its date of issue from the Consumer Fora. He did not produce the envelope in which the policy was received by him to prove as to on which date the said policy was received by him and further to prove that the request dated 6.12.2006 was made by him within the period of 15 days of the policy. The respondents, on the other hand, have produced the policy (Annexure R-3), which shows that it was issued on 28.12.2005 and according to OPs, it was despatched on 31.12.2005. It can be expected to have been received by the OPs within 7 days i.e. by 7.1.2006. He, however, did not exercise the option of review within 15 days period and enjoyed the insurance cover of the policy of above Rs. 28 lakh for about one year till 6.12.2006 when he requested for cancellation. The request made by the complainant was, therefore, beyond the period of review and was rightly declined by the OPs/respondents. They cannot be said to be deficient in this respect also.

9. It is argued by the learned Counsel for the OPs that the complainant/appellant paid only one year premium and became a defaulter thereafter. It was, therefore, a case of surrender of the policy and in view of Clause 4.2 of Annexure R-2, 100% of the amount of premium was to be recovered as surrender charges and therefore, the complainant was not entitled to the refund of any amount but the learned Ombudsman vide his order da

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ted 5.10.2007 directed the OPs/respondents to pay the ex gratia amount of Rs. 66,366 under Rule 16(2) read with Rule 18 of the R.P.G. Rules, 1998. The said amount has since been paid by the respondents and has been accepted by the complainant/appellant. No other amount is due from the OPs/respondents and, therefore, the complainant was not entitled to the claimed amount. 10. In view of the above discussion, the complainant/appellant was not entitled to any relief and the learned District Forum has rightly dismissed the complaint. There is no merit in this appeal and the same is accordingly dismissed. The parties are left to bear their own costs of litigation. 11. Copies of this order be sent to the parties free of charge.
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