LIC not liable for agent's unauthorized act, agent liable to indemnify the insured for not depositing the premium and revival of the policy.

JUDGMENT :

1. Both the appeals have been filed by the appellants against the same judgment dated 30.11.2006 of the learned District Forum, Ajmer (hereinafter referred to as “the DCF”) in Complaint no.142/05 titled Smt. Saroj Devi v. Ankur Mehta & LIC of India whereby the complaint of the complainant was allowed and both the appellants were directed to make a payment of Rs. 1 lakh severally and jointly with 9% interest to the complainant and an amount of Rs. 1500/- as cost of proceedings.

2. Brief facts giving rise to these appeals are that at the instance of Ankur Mehta, the agent of the LIC Vikas Kumar son of complainant got an Insurance Policy of Rs. 1 lakh on 28.03.2002 and an annual premium of Rs. 892/- was paid. The date of maturity of the policy was March 2031. The premium for March 2003 and 2004 could not be deposited by the insured and the policy had lapsed. Later on Mr. Mehta, the LIC agent came to the insured and got Rs.3500/- from him for revival of the policy and depositing the two premiums. Later on the insured Vikas died on 05.11.2004 in a hospital at Ajmer and claim was submitted by the complainant before the LIC of India but the same was repudiated vide letter dated 22.11.2004 on the ground that the policy had lapsed for non payment of premium. The agent did not deposit the premium with the LIC and hence the claim was repudiated by the LIC.

3. A complaint was filed by the complainant and the learned DCF vide impugned judgment allowed the complaint against both the appellants.

4. First Appeal No. 140/2007 has been filed by the LIC on the ground that the LIC was not at all responsible for payment of any claim to the complainant as the policy had lapsed due to non deposit of the premiums. The LIC is also not responsible for the acts of its agent as the agent is not entitled to receive the premium. The learned DCF ignored these aspect and erred in allowing the complaint against the LIC.

5. The second Appeal No. 106/2007 has been filed by the agent of the LIC on the ground that he was not responsible for depositing the premium on behalf of the insured and he did not receive any amount from the insured against the premium and revival of the policy. The cheque amounting to Rs. 3500/- in the name of “Self” was given to the appellant for the business of “cable dish” of his son and it was not against the policy. The learned DCF ignored these aspects and erred in holding that the amount of Rs. 3500/- was paid to him for revival of the policy and payment of two premiums. Therefore, the present appeal be allowed and the complaint be dismissed.

6. We have heard the arguments of the learned counsel for the parties and carefully perused the record and the impugned judgment.

7. It is an admitted fact that the son of the complainant Vikas got an insurance policy amounting to Rs. 1 lakh on 28.03.2002 from the LIC at the instance of Ankur Mehta, its agent. It is also an admitted fact that two subsequent premiums for the period 2003 and 2004 were not deposited by the insured and the policy had lapsed. It is also an admitted fact that a cheque, though not issued in the name of the LIC but it was addressed to “Self” and was given to Mr. Ankur Mehta, the agent of LIC for alleged revival of the policy and amount of two premiums. Though both the appellants submitted that the agent of the LIC was not authorised to collect and deposit the premium as per the provisions of the rules, but it is general practice that the agents generally assist the insured in depositing the premium and generally receive it and deposit it with the LIC. As per S.4 of the Agents Regulation of 1972 of the LIC, the agents are forbidden to receive and deposit the premium but at the same time proviso to these rules provides that the amount of premium can be received and deposited by the agent if they are authorised by the LIC in writing. On the basis of the proviso, the learned DCF observed that there was no specific bar for agents of the LIC to receive any premium under a