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CHANDIGARH CONSUMER DISPUTES REDRESSAL COMMISSION
Sham Sunder, President, Mr. Dev Raj and Mrs. Padma Pandey, Members
SBI LIFE INSURANCE COMPANY LTD. - Appellant
Versus
SURESH KUMAR AND OTHERS - Respondents
First Appeal Nos. 183, 185, 187 of 2014
Decided on : 09-07-2014
Mr. Rajneesh Malhotra, Advocate, Mr. C.L. Chaudhary, Advocate and Mr. Sumeer Bector, Advocate, for the Appellant; Mr. C.L. Chaudhary, Advocate., Mr. Sumeer Bector, Advocate., Mr. Sumeer Bector, Advocate, Mr. Rajneesh Malhotra, Advocate. and Mr. C.L. Chaudhary, Advocate, for the Respondent
The main legal point established in the judgment is that the processing of the surrender request and the refund of the surrender value were in accordance with the terms and conditions of the insurance policy, and there was no deficiency in service or unfair trade practice by the opposite parties.
Headnote:
Consumer Protection Act - Housing Loan - 12 - [Consumer Protection Act, 1986, Section 12] - The court allowed the complaint and directed the opposite parties to refund the balance amount retained by OP-3 after the surrender of the policy, pay compensation for mental harassment, pain, and agony suffered by the complainant, and pay litigation costs. The court found that the complainant suffered a loss due to the unfair trade practice and deficiency in service by the opposite parties. The court also discussed the terms and conditions of the insurance policy and the complainant's entitlement to the surrender value.
Fact of the Case:
The complainant obtained a housing loan from State Bank of India and got the house insured. Later, an additional loan was opened without his consent, and the complainant suffered financial loss and unfair trade practices. The complainant filed a complaint under the Consumer Protection Act, 1986, seeking refund, compensation, and litigation costs.
Finding of the Court:
The court found that the complainant's request for surrendering the policy was processed as per the terms and conditions, and the complainant received the surrender value. The court also found that the complainant's claim for the amount illegally deducted was not tenable. The court held that there was no deficiency in service or unfair trade practice by the opposite parties.
Issues: The issues involved the complainant's entitlement to refund and compensation, the processing of the surrender request, and the alleged illegal deduction by the opposite parties.
Ratio Decidendi: The court's decision was based on the complainant's consent to the insurance scheme, the processing of the surrender request as per the policy terms, and the lack of evidence to support the claim of illegal deduction.
Final Decision: The court allowed the appeals filed by the opposite parties, set aside the impugned order, and dismissed the complaint. The court also dismissed the appeal filed by the complainant.
ORDER
Mr. Dev Raj, Member -This order shall dispose of three First Appeals bearing Nos. 183/2014 filed by opposite party No. 3, 185/2014 filed by the complainant and 187/2014 filed by opposite party Nos. 1, 2, 4 and 5, against the order dated 11.4.2014, rendered by the District Consumer Disputes Redressal Forum-I, U.T., Chandigarh (hereinafter to be called as the District Forum only), vide which, it allowed Consumer Complaint No. 117 of 2013, filed by complainant, qua the opposite parties, and directed them as under:
"[13] Keeping in view the above detailed discussion, pleadings of the parties as well as relevant documents enclosed, we are of the opinion that the present complaint has merit in favour of the complainant. So, the complaint is allowed. The OPs are jointly and severally directed as under:
(i) to refund a sum of Rs. 138435 being the balance amount retained by OP-3 after the surrender of the policy.
(ii) to pay Rs. 20,000 as compensation for mental harassment, pain and agony suffered by the complainant due to the deficiency in service.
(iii) to pay Rs. 10,000 as litigation costs.
This order be complied with by the OPs within a period of 30 days from the date of receipt of copy of this order, failing which they shall be liable to pay interest @ 12% on the awarded amount from the date of filing of the complaint i.e. 26.2.2013 till its realization, besides costs of litigation."
2. The facts, in brief, are that the complainant got housing loan of Rs. 20.00 lacs, from Opposite Party No. l, i.e. State Bank of India on 16.12.2010 and monthly instalments were recoverable from his salary account No. 10286096712 with SBI, Sector 22, Chandigarh (Annexure C-l). It was stated that the housing loan account number was 31538609181. It was further stated that the house was got insured from SBI General Insurance Company Ltd. on 27.4.2011 vide Policy No. 1913-0000-00 and the total premium of Rs. 10,324 was paid and the Policy bond (Annexure C-2) was issued. It was further stated that the complainant, in response to the letter dated 23.2.2011 (Annexure C-3), attended a seminar organized by the Bank, where the Chief Manager of the Bank got certain papers and cheques signed from him. It was further stated that in March, 2011, SBI opened another loan account No. 31658807379 of the complainant for Rs. 2,18,300 and paid this entire amount, without his consent, to Opposite Party No. 3 i.e. SBI Life Insurance, Chandigarh. It was further stated that neither any Policy bond nor any certificate of Insurance was issued to the complainant. It was further stated that the complainant came to know about the said Insurance and new loan in August, 2011 on receipt of letter dated 12.8.2011 (Annexure C-4) from the Bank about the outstanding loan amount.
3. It was further stated that on visiting SBI office, the complainant was told that the loan account would be closed only after closing the SBI Life Insurance Policy. It was further stated that on the asking of the Chief Manager of the Bank, the complainant gave letter on 19.8.2011 (Annexure C-5) and also wrote to Opposite Party No. 3 - SBI Life Insurance Company to close the Policy, but it (Policy) was not closed despite making request within the stipulated period of 10 days. It was further stated that, ultimately, the complainant, in RTI application, was informed that SBI Life Insurance had refunded a sum of Rs. 79,865 (Annexure C-10), but the reasons for forfeiting and non-refunding the balance amount of Rs. 1,38,435 were not explained. It was further stated that Opposite Party No. 1 deducted Rs. 28,816 from his account and paid the same into SBI Life Insurance Loan Account, which was illegally opened without his consent. It was further stated that, as such, the complainant further suffered a loss of Rs. 28,816 (Annexure C-11) on account of unfair trade practice.
4. It was further stated that a legal notice (Annex
