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ORISSA STATE CONSUMER DISPUTES
REDRESSAL COMMISSION, CUTTACK
Hon’ble Mr. Justice S.C. Mohapatra, President;
Dr. R.N. Panigrahi, Member
K.K. MISHRA—Complainant
versus
BRANCH MANAGER, L.I.C. OF INDIA & ANOTHER—Opposite Party
C.D. Case No. 122 of 1991—Decided on 4.5.1992
For the Complainant : In person.
For the O.P. :M/s. A.S. Naidu, P.K. Mohanty, C.R. Dash, D.R. Ray & A.K. Rath, Advocates.
Delay in payment of money back under a money back policy without prior intimation to the complainant constitutes a deficiency in service under the Consumer Protection Act.
Headnote:
CONSUMER PROTECTION ACT - INSURANCE - DEFICIENCY IN SERVICE - DELAY IN PAYMENT OF MONEY BACK UNDER MONEY BACK POLICY - INSURANCE CORPORATION LIABLE FOR DEFICIENCY IN SERVICE.
Fact of the Case:
Complainant, insured under a money back policy with Life Insurance Corporation of India, requested transfer of policy and documents from Kalol Branch to Bhubaneswar Branch. Despite transfer of documents, there was a delay in payment of the 1st money back due on 15.3.1991. Complainant made several inquiries and grievances to the branch office, Divisional Office, and head office, but payment was not received until 4.10.1991, the date of filing the complaint.
Finding of the Court:
The court found that there was a deficiency in service on the part of the insurance corporation due to the delay in payment and the lack of communication to the complainant about the delay. The court also noted that the insurance corporation had a bureaucratic attitude and was intolerant of allegations of deficiency in service.
Issues: Whether there was a deficiency in service on the part of the insurance corporation.
Ratio Decidendi: The court held that insurance comes within the definition of 'service' under Section 2(o) of the Consumer Protection Act and that any fault, imperfection, shortcoming, or inadequacy in the performance of such service constitutes a deficiency under Section 2(g) of the Act. The court further held that the insurance corporation had a duty to pay the money back on the due date and that the delay in payment without any prior intimation to the complainant amounted to a deficiency in service.
Final Decision: The court allowed the complaint and directed the insurance corporation to ascertain whether the complainant had received the payment and, if not, to pay the same with interest.
Mr. Justice S.C. Mohapatra, President— Deficiency in insurance service is grievance of complainant.
2. Case of complainant is that he is insured under salary saving scheme having a money back policy for a sum of Rs. 10,000/- in Kalol Branch of Life Insurance Corporation of India. On 15.3.1986 when he was transferred to the State Marketing Office at Bhubaneswar on 16.6.1988, he requested the Kalol branch to transfer all the documents relating to the policy to Main Branch Unit 7, Bhubaneswar. As per the request documents were transferred from Kalol Branch on 20.6.1988 to be received in Bhubaneswar Branch on 30.6.1988. On transfer of the complainant to Sambaipur Office, he requested to transfer the policy to Sambalpur Branch after changing the monthly premium to be paid quarterly. Since 1st money back-payment was due on 15.3.1991, he was informed that the transfer of policy would be effected after payment of 1st money back. When there was delay in payment, complainant enquired about it on 20.4.1991 and about the transfer of the policy. Since the bag containing his documents received from Kalol Branch was not available, the dealing assistant told that a do my packet would be opened any dues payable shall be released. On 20.5.1991, complainant received the forms of discharge and signing the same returned to branch office along with original policy on 25.5.1991. Grievance has been made that till the date of filing of the complaint on 4.10.1991 he has not received payment although he has visited Bhubaneswar branch from Sambaipur four to five times to enquire about the payment and has also made grievance to the Cuttack Divisional Office as well as Bombay head office.
3. On receipt of notice with copy of complaint on 15.1.1992, opposite party addressed a letter to the commission that the claim has been settled on 7.10.1991 for a sum of Rs. 2,101/- (rupees 2000/- due + rupees 101/- interest) and policy has been transferred to Sambalpur. Thereafter it has stated the case asserting that delay was due to non-receipt of necessary particulars of premium payment position which were to fee called for from Kalol office in State of Gujarat and on receipt of the same payment has been made. For delayed payment, interest has also been paid. It is asserted that corporation has been constituted and established under the Life Insurance Corporation Act and functionaries of the corporation are aware of public accountability. Since decision for payment was taken after receipt of relevant information from the original servicing branch, there was no deficiency in service. It was also claimed that if at all it is a breach of contract and such breach cannot come under the Act since redressal agencies under the Act are not substituting of common law Forum.
4. Insurance comes within the definition of ‘service’ under Section 2(o) of the Act. From the stage of publication of scheme of insurance till the full discharge is given, there should not be any deficiency which is defined in Section 2(g) to mean any fault, imperfection short-coming or inadequacy in performance of such service which is required to be maintained. When due date of payment is 15.3.1991 it was to be performed by that date. In case there was any difficulty, the insured is to be intimated about the same. All actions are to be taken much prior to the date of payment so that insured is either paid or in case of difficulty is intimated the cause of delay with expression of apology for inconvenience if any. In the present case, such attitude is wanting which is a short-coming and imperfection in performance. No letter has been produced before us to the effect that insurer was intimated of the genuine difficulty for bearing with the corporation. Thus, the constituents of the corporation who claim to be aware of the public accountability are found to be victious of beaurocratic attitude intolerant of a deficiency being alleged against them. Unless such attitude changes in future serious view shall
