Judicial Analysis Court Copy Headnote Facts Arguments Court observation

NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION
V.B. Gupta, Presiding Member and Vinay Kumar, Member
FAIZAN M.A. ZAHEER - Appellant
Versus
BRANCH MANAGER, LIC AND ORS. - Respondents
First Appeal No. 521 of 2011 against Order dated 21.11.2011 in CCSR No. 5666 of 2011 of State Commission, Andhra Pradesh
Decided on : 17-07-2012

Advocates Appeared:
Mr. Rayeece M.A. Khadir, Advocate, for the Appellant; None, for the Respondent

The court upheld the State Commission's decision on pecuniary jurisdiction and cited the case of Punj Lloyd Ltd. v. Corporate Risks India Ltd., 2009 (2) SCC 301 to support its conclusion.

Headnote:
Insurance - Death Claim - Consumer Dispute - Money Plus Policy - Sum Assured - Fund Value - Pecuniary Jurisdiction - AP State Consumer Disputes Redressal Commission - [Insurance] - [Money Plus Policy] - [Consumer Protection Act, 1986, Section 21] - The court discussed the nature of the insurance policy, the payable amount in case of death of the assured, and the pecuniary jurisdiction of the District Forum. The court cited the case of Punj Lloyd Ltd. v. Corporate Risks India Ltd., 2009 (2) SCC 301 to support its conclusion that the State Commission was not required to hear the other party and give a finding on merits when the material before the Commission showed that pecuniary jurisdiction lay elsewhere.
Fact of the Case:

The complaint arose from the death claim of the deceased assured under the Money Plus policy taken by the complainant's brother from OP/LIC of India. The State Commission noted the amounts payable under the policy and observed that the matter fell within the pecuniary jurisdiction of a District Forum.
Finding of the Court:

The State Commission's conclusion that the matter fell within the pecuniary jurisdiction of a District Forum was upheld. The court dismissed the appeal, stating that the State Commission was not required to hear the other party and give a finding on merits when the material before the Commission showed that pecuniary jurisdiction lay elsewhere.
Issues: Nature of the insurance policy, payable amount in case of death of the assured, pecuniary jurisdiction of the District Forum
Ratio Decidendi: The State Commission's decision on pecuniary jurisdiction was upheld, and it was found that the State Commission was not required to hear the other party and give a finding on merits when the material before the Commission showed that pecuniary jurisdiction lay elsewhere.
Final Decision: The appeal was dismissed with no orders as to costs.

ORDER

Vinay Kumar, Member - This appeal has been filed against the order of AP State Consumer Disputes Redressal Commission, in CCSR No. 5666 of 2011. The Complainant had made the following prayer before the State Commission:

"The Hon'ble Court may be pleased to direct the opposite party No's (1) to (3) to pay the following amount towards settlement of death claim of the deceased assured per Mr. Fazal Mohammed Omer Qayyum (since dead) to the Complainant/nominee

(i) admitted HLV of the deceased with multiplier twenty-two (22) times the annual income at rate of Rs. 4,00,000 p.a. is equal to 22 x 4,00,000=Rs. 88,00,000.

Compensation towards causing mental agony and torture Rs. 5,00,000

Towards deficiency of service by not calling the Complainant for negotiation contrary to the Public Notice of the officials of opposite party Rs. 5,00,000

Total: Rs. 98,00,000"

2. The complaint arises out of Money Plus policy taken by the brother of the Complainant from OP/LIC of India with effect from 29.3.2007. The insured died on 13.1.2010. As the nominee of the insured, the Complainant informed the OP on 27.1.2010. After certain amount of correspondence, the OP/LIC of India issued a proposal form on 28.5.2011. Allegedly the claim under the policy was filed on 28.8.2010 but the claim continued to remain with the OP without being settled till 29.10.2011, when the consumer complaint was made. As it appears from the complaint petition, legal notice was also issued to the OP/LIC on 19.4.2011 with no result till the filing of the complaint before the State Commission.

3. It is seen from the record submitted before the State Commission that under the terms of the policy the following amounts were payable:

"Sum assured under the Basic Plan

Accident Benefit Sum Assured Rs. 1 lakh

Critical illness Rider Sum Assured: Rs. 1 lakh

Amount payable on death:

In the event of the death of the life assured prior to the date of maturity, when the cover is in full force, an amount equal to the higher of sum assured under the basic plan or the Fund value units held in the Policy Holder's Fund value shall become payable notwithstanding which is mentioned above."

4. The State Commission has noted that the assured had paid premium for three years commencing 29.3.2007, before he died on 13.1.2010. Considering the same, the State Commission has observed as follows:

"At the end of three years if the person is aged 33 years fund value was mentioned at Rs. 41,758 and the death benefit of Rs. 1 lakh. We reiterate that the nominee would be entitled to receive the sum assured under the basic plan or the fund value as on the death of life assured whichever is more i.e., where the sum assured is Rs. 1 lakh and the premium of Rs. 10,000 is paid for three years, the nominee would be entitled for Rs. 1 lakh only assuming the fund value for the three years contributed by the life assured would be less than the sum assured. Therefore, it could not have been Rs. 88 lakh on payment of yearly premium of Rs. 10,000 under the scheme. Since his death was after three years of taking of the policy by no stretch of imagination it can be said that an amount of Rs. 88 lakh would be accrued by covering all these tables that were prepared by the LIC agents enclosed by the complainant while filing the complaint. We are not satisfied with the claim mentioned as it is not supported by any rules. Therefore, we are of the opinion that this is a fit case where the complainant can be returned for presentation before appropriate District Forum having jurisdiction in the matter."

The State Commission therefore, decided to return the complaint with an observation that the same could be filed before an appropriate District Forum.

5. We have perused the records and heard Mr. R.M.A. Khadir, Counsel for the appellant. The order of the State Commission has been challenged on the ground that the State Commission has arrived at its conclusion without hearing the other side and without appreciating the record.

6. A perusal of the

Click Here to Read the rest of this document