Court Judgments

BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, HOSHIARPUR.

1. 1. NO. 282/14.10.2010Decided on : 14.3.2011

Surinder Kaur W/o Swaran Singh, r/o Village Talwandi Jattan, P.O. Gardhiwala, Distt. Hoshiarpur.

………. Complainant

versus

1. LIC of India, Northern Zonal Office, Jeevan Bharti Building, Tower 2, 11^th Floor, 124, Connaught Circus, New Delhi, through its Regional Manager.
2. LIC of India, Branch Office, Chandigarh Road, Garhshankar, District Hoshiarpur, through its Branch Manager.

……. Opposite Parties

Complaint u/S 12 of the Consumer Protection Act, 1986.

Quorum: Sh. P.D. Goel, President,

Mrs. Vandna Chowdhary, Member.

Present: Sh. Sanjiv Bhardwaj, counsel for the complainant.

Sh. D.S. Seehra, counsel for the opposite parties.

PER P.D. GOEL, PRESIDENT:

1. The complainant namely Surinder Kaur has filed the present complaint, under Section 12 of the Consumer Protection Act, 1986 (as amended up to date) “hereinafter referred as the Act”. Stated briefly, the facts of the case are that the complainant was the holder of policy No. 130830532, which matured in the month of February, 2010, as such, she visited the office of OP No. 2 with the request to release the maturity amount of Rs. 1,19,986/-. The complainant was informed by OP No.2 that they are unable to pay the maturity amount. The complainant submitted written request to OP No.2 to provide the maturity amount of the said policy. The OP No.2 took the original policy and other documents from the complainant and told that her case will be forwarded for payment.
2. It is the allegation of the complainant that in the 2^nd week of July, 2010, the opposite party No. 2 sent a letter that OP No. 1 has refused to make the payment. The complainant made number of requests to the opposite parties to pay the maturity amount of Rs. 1,19,986/-, but of no avail, hence this complaint.
3. The opposite parties filed the joint reply. The preliminary objections vis-a-vis maintainability, estoppel and suppression of material facts were raised. On merits, the claim put forth by the complainant has been denied. It is replied that the complainant is not entitled for any relief, as she has purchased an Annuity policy bearing No. 130830532 commencing from 22.2.1992 and its date of vesting was 22.2.2010.
4. It is further replied that the complainant became entitled to get the first annuity instalment on 1.3.2010. Thereafter, the Zonal Office of the replying O.Ps issued 13 cheques bearing nos. 081788 to 081800 for the period from February, 2010 to February, 2011, but the complainant returned the said cheques to the Branch Office of the opposite parties at Garhshankar. It is further replied that the Branch Office of the opposite parties sent the said 13 cheques, policy bond and surrender request to the complainant, per terms and conditions of the policy. The complainant was also informed that the surrender request of annuity was not allowed by the Competent Authority after vesting of annuity vide letter dated 5.7.2010.
5. However, it is admitted that in the month of February, 2010, the said policy got matured. It is denied that the complainant visited the office of OP No. 2 for the release of the amount of the policy, as alleged by her. It is further replied that Table No. 96 is “Jeewan Dhara Policy” which is an annuity policy and in the policy bond itself, it is clearly mentioned that lumpsum payment or surrender value is payable only before vesting the annuity. Thus, there is no question to release the amount under the policy to the complainant.
6. It is further replied that the complainant on 4.6.2010 informed the office of OP No.2 through e-mail that she does not want to receive the annuity amount. The complainant was informed by OP No. 2 that the policy in question is an annuity policy and the surrender of annuity policy is not allowed after vesting.
7. The parties led evidence in the case.
8. The learned counsel for the parties have filed written arguments. We have gone through the written submissions and record of the file minutely.
9. The learned counsel for the complainant submitted that prior to vesting of the annuity, the O.Ps-LIC had not sent any letter to exercise the option. It was also argued that the policy matured on 22.2.2010 qua Mark OP-2. The counsel for the complainant also placed on record the letter dated 17.7.2008 of the opposite parties.
10. The ld. Counsel for the opposite parties submitted that since the annuity has vested, therefore, there is no question to surrender the policy. The reference was made to the terms and conditions – Mark OP-2, wherein under the Heading “ Guaranteed Surrender Value”, it has been stated that the policy cannot be surrendered after the Annuity has vested. Mark OP-4 and Mark OP-5 are the lists of 13 cheques from February, 2010 to February, 2011 sent by the opposite parties to the complainant.
11. It was further argued that the complainant wrote a letter – Mark OP-6 to the Regional Manager (CRM), IPP Cell, LIC of India, New Delhi to make lump sum payment in respect of Policy No. 130830532. The said letter was replied vide Mark OP-7, wherein it was made clear that the policy in question is a Jeevan Dhara Policy, which is an annuity policy, and in the policy bond itself, it is made clear that Lump sum payment under the policy can be made only before vesting. The request for surrender payment under the policy was forwarded to IPP cell by registry No. 2079.
12. Mark OP-8 is a letter dated 8.6.2010 by the complainant to the Branch Manager, LIC of India, Garhshankar, wherein it has been stated that with reference to policy No. 130830532, the cheques No. 081788 to 081800 (13 cheques) have been received, but she wants the annuity amount in lump sum, therefore, the said cheques are returned. Mark OP-9 is a letter by LIC, Garhshankar to the complainant that they are returning the annuity cheques along with her request to surrender the policy, as the surrender of annuity policy after vesting is not allowed. Reference was also made to letter dated 1^st October, 1987 – Mark OP-12, wherein under the Heading “Surrender Value”, it has been stated that the policy cannot be surrendered after the Annuity has vested.
13. The learned counsel for the opposite parties also made a reference to copy of Circular regarding ratification under Plan 96, wherein it has been stated that there is no need of option letters under plan 96.
14. Now, the only point which calls decision from this Court is whether it was essential to send an option letter to the complainant prior to vesting of the annuity? The answer to this is in the affirmative.
15. It is an admitted fact that the policy in question matured on 22.2.2010, as is evident from Mark OP-2. It is also an admitted fact that Circular regarding ratification under Plan 96, placed on record in compliance of the order dated 25.2.2011 had neither been attested nor signed by anyone, therefore, it loses its evidentiary value.
16. There is no dispute with regard to the vesting of the annuity, as the policy had matured on 22.2.2010. The opposite parties have produced the evidence with regard to the sending of 13 cheques from February, 2010 to February, 2011 through Mark OP-4 and Mark OP-5 to the complainant. It is also an admitted fact that the complainant wrote letters dated 4.6.2010 and 8.6.2010 (Mark OP-6 and Mark OP-8) with regard to the payment of annuity amount in lump sum.
17. There is no dispute that the policy cannot be surrendered after the annuity has vested, as is clear from the terms and conditions, Mark OP-2 and letter dated 1.10.1987 – Mark OP-12. The complainant has produced on record the letter dated 17.7.2008 written by the Head Office of the opposite parties to All Zonal Managers, All Sr./Divisional Managers, All R.Ms (CRM), MDC, Audit and Inspection, with regard to Option Letters under All Annuity Plans. The perusal of the said letter makes it clear that the said letter has been written by the Head Office of the opposite parties on the basis of regular and rising complaints received from annuitants regarding non-receipt of Option forms before vesting of the policy. It was decided that the Option forms along with Calculations of Annuity, Mode-wise and With/Without Commutation-Wise, ECS Mandate etc., shall be sent by the Branches through “Registered AD only” instead of ordinary post.
18. Now, it is clear from the letter dated 17.7.2008 that the opposite parties were bound to send option form along with calculations of annuity, mode-wise to the complainant through Registered AD only, which they have not sent. The letter dated 17.7.2008, which applies to “All Annuity Plans” has not been rebutted by the opposite parties.
19. The non-compliance of the instructions contained in the letter dated 17.7.2008 amounts to deficiency in service, as the Option Form along with Calculations of Annuity , Mode-wise were not sent by the opposite parties to the complainant.
20. As a result of the above discussion, the complaint of the complainant is accepted and the opposite parties are directed to make the payment of Rs. 1,19,986/- along with interest @ 9% per annum from the date of maturity i.e., 22.2.2010 to the complainant, besides, litigations costs of Rs. 1000/- within one month from the date of receipt of copy of the order. Copy of the order be sent to the parties free of cost. File be consigned to the record room. Announced.

14.3.2011

(Mrs. Vandna Chowdary) ( P.D. GOEL )

MEMBER PRESIDENT

vs