LIC OF INDIA vs CHOUDHMAL

THIS appeal has been filed by the appellant LIC which was O. P. No. 1 before the District Forum, Chittorgarh against the order dated 31. 7. 2007 passed in Complaint Case No. 287/2006, by which a sum of Rs. 25,000 were ordered to be paid by the appellant to respondent No. 1 as amount of ex gratia payment.

IT arises in the following circumstances: that the complainant-respondent No. 1 had filed a complaint against the appellant LIC as well as against respondent No. 2 Kamal Kumar, the agent of the LIC before the District Forum, Chittorgarh on 2. 9. 2006 inter alia stating that his wife Smt. Rekha Sharma, now deceased had taken a life insurance policy bearing No. 183161675 on 25. 3. 2002 for a sum of Rs. 50,000 form the appellant LIC. It was further stated in the complaint that the deceased had died on 15. 8. 2004 and prior to that all the premiums were being paid by the deceased through the agent of the LIC, respondent No. 2. It was further stated in the complaint that the premium for the month of June 2004 was paid by the deceased to respondent No. 2 on 8. 7. 2004 but no receipt was given by respondent No. 2 and after the death of the deceased, a claim was preferred by the complainant respondent No. 1 being the nominee and husband of the deceaed, but that claim was repudiated by the LIC, the appellant through letter dated 2. 9. 2004 on the ground that since the premium for the month of June 2004 was not deposited by the deceased in her life time since the deceased died on 15. 8. 2004, therefore, on the date of death, the policy was in a lapsed condition, hence claim was not payable. Thereafter the present complaint was filed. A reply was filed by the appellant on 17. 10. 2006 and in the reply the appellant had taken the same step which they have taken in the repudiation letter dated 2. 9. 2004 and it was prayed that since the policy on the date of death was a lapsed one, therefore, the complaint be dismissed.

A reply was also filed by respondent No. 2 and it was stated by respondent No. 2 that no payment for the premium of June 2004 was given to him by the deceased, hence no case complaint be dismissed against him.

THE District Forum after hearing both the parties through the impugned order dated 31. 7. 2007 had allowed the complaint partially inter alia holding that no doubt on the date of death, the policy was in a lapsed condition as the amount for the premium for the month of June, 2004 could be deposited upto 31. 7. 2004 and since it was not deposited upto 31. 7. 2004, therefore, the policy was a lapsed policy and the case of the complainant-respondent No. 1 that premium for the month of June 2004 was paid to the respondent No. 2 was not found acceptable and that a sum of Rs. 25,000 were ordered to be paid by the appellant to the complainant respondent No. 1 on account of ex gratia payment. Aggrieved from that order of the District Forum, this appeal has been filed by the appellant LIC and in this appeal the main contention of the learned Counsel for the appellant LIC is that when the District Forum had found that the policy in question was a lapsed one on the date of death of the deceased, therefore, awarding of Rs. 25,000 as amount of ex gratia payment could not be justified and the findings recorded by the District Forum be quashed and appeal be allowed. On the other hand, the learned Counsel for the respondent No. 1 complainant has supported the impugned order.

WE have heard the learned Counsel for the parties. In this case there is no dispute on the point that on the date of death, the policy in question was a lapsed one and to that extent the findings recorded by the District Forum are liable to be confirmed one as no appeal againt the findings recorded by the District Forum had been filed by the complainant-respondent No. 1. The question for consideration is whether awarding of Rs. 25,000 as ex gratia payment to the complainant-respondent No. 1 would be justified or not.

IN this case, there is no dispute on the point that while prefering the appeal, a sum of Rs. 25,000 had been deposited by the appellant.

IN our considered opinion, awarding of Rs. 25,000 as amount of ex gratia payment for the policy which was for a sum of Rs. 50,000 and the policy which was found lapsed one, could not be justified and this amount is on higher side and looking to the facts and circumstances, if a sum of Rs. 12,500 is ordered to be paid by the appellant LIC to respondent No. 1 as ex gratia payment that would meet the ends of justice. For reasons, the appeal is partly allowed in the manner that the appellant LIC would now pay a sum of Rs. 12,500 in place of Rs. 25,000 as amount of ex gratia payment to the complainant-respondent No. 1 and to that extent the impugned order dated 31. 7. 2007 passed by the District Forum, Chittorgarh be treated as modified. It is further made clear that out of the amount deposited by the appellant, a sum of Rs. 12,500 be released in favour of the complainant-respondent No. 1 and rest amount be refunded to the appellant LIC. Appeal partly allowed.