LIFE INSURANCE CORPORATION OF INDIA vs Puran Chand Jain/ Advocate

THIS Revision Petition has arisen out of the Order dated 28.11.1995 passed by the Rajasthan State Commission at Jaipur upholding the order dated 16.12.1992 passed by the District Forum, Dausa, allowing the complaint and directing the Opposite Parties, Petitioners herein, to make payment of Rs. 1,746.20 and interest at the rate of 12% per annum from 5.8.1978 till the date of payment.

THE Complainant took a life insurance policy No 6823829 from the Life Insurance Corporation of India (for short called LIC). Thereafter, the Complainant took a loan against the said policy. The said policy matured on 5.8.1978. According to the Complainant the discharge form No. 3825 was sent to LIC Divisional Office at Jaipur, but there was no response and he sent several reminders and registered notices demanding the payment of the matured value. The Complainant alleged deficiency in service on the part of the LIC in not settling the matured claim and claimed Rs. 1.800/ - as the balance insurance amount, Rs. 625/ - as expenses alleged to have been incurred in coming to Jaipur from Dausa and claimed Rs. 2,000/ - as damages for mental agony and distress. On being noticed, the LIC admitted that the abovesaid policy matured on 5.8.1978 and after adjusting the loan amount, a sum of Rs. 1,746.20 was paid to the Complainant vide Cheque No. 257538 dated 13.10.1978. The LIC also took a plea that the policy in question had matured on 5.8.1978 and the cause of action arose on 5.8.1978 and thus the complaint that was filed on l2.12.1991 was hopelessly time -barred.

THE District Forum, Dausa, after hearing the parties and going through the records directed the LIC to pay a sum of Rs. 1,746.20 alongwith interest at the rate of 12% p.a. w.e.f. 5.8.1978 after recording a finding that LIC had failed to prove the payment. The State Commission in appeal by the LIC, held that since the LIC failed to prove the payment of Rs. 1,746.20 to the Complainant, the District Forum had rightly allowed the amount to the Complainant which was the balance of the sum assured payable to him. The Appeal was dismissed by the State Commission by the impugned Order dated 28.11.1993.

WE have heard Mr. Mohinder Singh, learned Advocate appearing for the LIC and with his help gone through the records of the case as the Respondent did not put in appearance. The finding of the District Forum as upheld by the State Commission, is that the LIC had issued policy No. 6823829 and this was due to mature on 5.8.1978, that the amount payable to the Complainant under the said matured policy was Rs. 1,746.20 and that the discharge voucher No. 3825 was sent by the Complainant. The District Forum relied upon the affidavit of Shri P.C. Jain, Advocate, the Complainant, that he had not received any cheque of any bank against the amount of his matured insurance policy No. 6823829. The District Forum also came to the conclusion that the LIC has not been able to prove that the payment of balance amount of Rs. 1,746.20 had been made to the Complainant on 13.10.1978 as the photocopy of the payment register submitted by the LIC does not show any entry of payment and neither any affidavit in this regard is submitted. This finding of the District Forum, as upheld by the State Commission, is against the record and in our view perverse. The records of the I.IC in respect of the matured policies are only maintained and preserved for a period of 5 years and thereafter those records are destroyed and thus the LIC could not file the discharged policy or the signed voucher of payment. The LIC had filed the affidavit of Shri A.S. Ramanathan, Manager, and a photocopy of the matured policy payment register. From the relevant entry contained in the matured policy payment register the fact of payment of the balance amount of Rs. 1,746.20 to the Complainant was clearly established. If the payment of the balance of the amount due to the Complainant had not been made, the Complainant who is an Advocate would not have waited till 24th March, 1990 when he had sent for the first time a registered notice. There is no reason to reject the sworn testimony of Shri A.S. Ramanathan based on the official records that the payment was made vide Cheque No. 257538 dated 13.10.1978. Apart from it, the cause of action arose on 5.8.1978 for recovery of the balance amount of the policy in question. Before the insertion of Section 24 -A of the Consumer Protection Act, 1986 prescribing a period of limitation for filing the complaints there was no period of limitation prescribed under the Consumer Protection Act. The FORA under the Act declined to entertain stale claims and generally considered the period of limitation as prescribed in the Limitation Act as a guiding factor for entertaining the complaints. The complaint was filed on 12.12.1991 long after the expiry of a period of 13 years from the date of 5.8.1978 when the cause of action arose. The District Forum had no jurisdiction to entertain a stale claim, after an expiry of period of 13 years. The impugned Orders of the State Commission as well as District Forum suffer from serious irregularity and illegality in the exercise of jurisdiction and are hereby set aside. The Revision Petition is allowed and the complaint is dismissed leaving the parties to bear their own costs. Revision Petition allowed.