JAREENA BANO vs Life Insurance Corporation of India

THIS appeal has been filed by the complainant appellant against order dated 5.4.2006 passed by the District Forum, Bikaner in Complaint No. 227/2005 by which the complaint of the appellant was dismissed. It was further ordered that respondents LIC would pay a sum of Rs. 664 as the amount of paid up value.

IT arises in the following circumstances: That the complainant appellant had filed a complaint before the District Forum on 18.8.2005 inter alia stating that her husband Mohd. Aareef, now deceased, had taken two LIC policies from the respondents bearing No. 500960459 for a sum of Rs. 50,000 on 13.3.2001 and another bearing No. 501110771 for a sum of Rs. 50,000 on 30.3.2002. IT was further stated that in respect of policy No. 500960459 the premium was to be deposited in quarterly and premium for the month of March 2002 had become due and the amount of premium to the tune of Rs. 664 was paid to the agent of the LIC Sh. Sanjay Kumar Tapadia along with the premium in respect of another policy. IT was further stated that on 10.4.2002, the deceased became victim of the disease of Meningities and in the unconscious condition he was admitted in the PBM Hospital on 13.4.2002 where he had died on 16.4.2002. IT was further stated that in respect of second policy the payment had been made by the respondents but in respect of policy No. 500960459 the claim was not paid by the LIC on the ground that on the date of death i.e., on 16.4.2002 the policy in question was in a lapsed condition and that was wrongly treated as lapsed as the payment was made to the agent of the LIC in the month of March, 2002 and if he had not deposited that amount, for that complainant appellant should not suffer. Therefore, the present complaint was filed. A reply was filed by the respondents on 15.10.2005 admitting the fact that both policies were taken by the deceased but in respect of policy No. 500960459 payment could not be made as the policy on the date of death i.e., 16.4.2002 the policy was in a lapsed condition as payment for the first quarter of 2002 was to be made upto 12.3.2003 and the grace period was upto 13.4.2002 and since the death had taken place on 16.4.2002, therfore, on the date of death the policy was in a lapsed condition and thus the claim was not payable and it was prayed that complaint be dismissed. After hearing the parties, the District Forum, Bikaner through impugned order dated 5.4.2006 had dismissed the complaint inter alia holding that the policy No. 500960459 in question had lapsed one on the date of death of the deceased. Aggrieved from the said order dated 5.4.2006 passed by the District Forum, Bikaner this appeal has been filed by the complainant appellant. In this appeal the following contentions have been raised by the learned Counsel for the appellant: (i) That since the payment of the premium for the month of March 2002 had been made by the deceased to the agent of the LIC Sh. Sanjay Kumar Tapadia and if the amount was not deposited by that agent in the office of the respondents for that complainant appellant could not be held responsible.

(ii) That when the amount of Rs. 3,347 in respect of policy No. 501110771 was also paid to the agent and they were deposited by that agent, therefore, it should be presumed that amount of Rs. 664 was also received by that agent in the month of March 2002 and thus on the date of death on 16.4.2002 the policy in question was not in a lapsed condition and the findings recorded by the District Forum are erroneous one and be quashed and set aside and appeal be allowed.

On the other hand the learned Counsel appearing for the respondents has supported the impugned order of the learned District Forum.

WE have heard the learned Counsel appearing for the parties and gone through the entire materials available on record. There is no dispute on the point that the deceased had taken LIC policy from the respondents bearing No. 500960459 for a sum of Rs. 50,000 on 13.3.2001 and premium was to be made quarterly.

THERE is no dispute on the point that premium for March 2002 had not been found established to be deposited in the office of the respondents. There is also no dispute on the point that if grace period was also allowed, that would also expired on 13.4.2002 and thus on the date of death i.e., on 16.4.2002 the policy was in a lapsed condition. This is one aspect of the matter. The another question for consideration is whether the payment of premium to the tune of Rs. 664 in March 2002 for the first quarter had been made by the complainant appellant or the deceased to one Sanjay Kumar Tapadia or not or whether that would have any bearing or not.

IN this case there is nothing on record to prove the fact that the payment had been made by the deceased to the agent of the LIC Sh. Sanjay Kumar Tapadia in the month of March 2002 and in absence of any documentary evidence this payment could not be held to have been made by the deceased to the agent of the LIC.

FURTHER in support of that no affidavit of Sanjay Kumar Tapadia had been produced indicating that the payment was received by him. Merely because in respect of another policy the payment made to Sanjay Kumar Tapadia was found valid one would have no meaning so far as the LIC is concerned until and unless the payment had been received by the LIC. Since the payment in respect of policy No. 501110771 was found valid one but in respect of policy No. 500960459 for the month of March 2002 was not found valid, therefore, if the policy was treated as lapsed one, the respondents had not committed any illegality. It may be stated here that in this case the fact that the appellant complainant had failed to prove the fact that any payment was made to the agent and apart from that the Hon''ble Supreme Court in the case of Harshad J. Shah & Anr. v. LIC of India & Ors. reported in III (1997) CPJ 9 (SC)=III (1997) CLT 360 (SC)=Legal Digest January 1997 has held that the payment of premium in respect of LIC policy by the insured to the agent of the Corporation could not be regarded as payment to the LIC. From that point of view also the alleged averment has to be rejected.

Thus, the respondents LIC were justified in repudiating the claim of the complainant appellant on ground of lapsed policy and the findings of the District Forum dismissing the claim of the complainant appellant are liable to be confirmed as they are based on correct appreciation of entire materials and evidence available on record and they do not suffer from any basic infirmity, illegality or perversity and this appeal deserves to be dismissed.

IT may further be stated here that before the policy was treated as lapse one, four instalments to the tune of Rs. 664 each had been paid by the deceased as premium to the respondents LIC. Thus, looking to the entire facts and circumstances of the case and on humanitarian consideration, this Commission thinks it just and proper to award ex gratia amount of Rs. 20,000 in lump sum to the complainant appellant who is an illiterate widow lady. Accordingly, this appeal filed by the appellant stands dismissed. However, the respondents LIC are directed to pay to the complainant appellant a sum of Rs. 15,000 as ex gratia amount within a period of two months from today. Appeal dismissed.