DIVISIONAL MANAGER, LIFE INSURANCE CORPORATION vs RAJENDRA MAHESHWARI

LIFE Insurance Corporation of India (L.I.C.) and one another have come up in appeal against the order dated 6.8.1997 passed in Case No. 28/98 by the District Consumer Disputes Redressal Forum, Dewas (for short the ''District Forum'').

THE facts giving rise to this appeal are thus, the respondent gave a proposal dated 30.3.1995 for taking a Money Back Children''s Assurance (without profits), which was accepted by the L.I.C. and a Policy No. 340202966 of table and terms 113-23 (15) xxx/03 for the sum assured Rs. 25,000/-, mode of payment half-yearly of Rs. 873/- of the life assured, i.e. Akshay Maheshwari was issued. THE life assured died on 2.5.1996, i.e. prior to commencement of the risk as contained in special provisions. L.I.C. did not make the payment of the benefits of the policy and sent a letter dated 30.7.1996 to accept the premium amount of Rs. 2,619/- deposited by the respondent with the L.I.C. THE respondent did not accept and filed a complaint before the District Forum. THE complaint was resisted. THE District Forum after appreciation of the material on record held that the book containing special provisions in relation to the table 113 was not given to the complainant, therefore, LIC cannot take advantage of the same, hence, ordered to make payment of Rs. 25,000/- with interest at the rate of 18% p.a. from the date of filing of the complaint, i.e. 11.9.1998 with Rs. 500/- as compensation, and Rs. 150/- as cost of the proceedings. Mr. Deepesh Joshi, learned Counsel for the appellant and Mr. Shyam Sunder Sikarwar, learned Counsel for respondent heard.

The proposal of the complainant to obtain the policy is on record, which clearly shows that the respondent opted for policy of table 113. The proposal was accepted and the policy of table and term 113-23 was issued. In the policy, the column of date of commencement of risk and vesting date is vacant. In the circumstances the benefits of the policy except the premium deposited were not payable in case the life assured dies on or before the date of commencement of risk as per special provisions contained in the policy, which reads thus : Special provisions (1) If the life assured shall be alive on the date on which he attains the age of majority (hereinafter called the vesting date) if all the premiums due prior to such vesting date have been paid and if a request in writing for surrendering the policy has not been received by the Corporation before such vesting date from the person entitled to the policy moneys, this policy shall vest in the life assured on such vesting date and shall on such vesting be deemed to be a contract between the Corporation and the life assured as the absolute owner of the policy and the proposer or his/her estate shall cease to have any right or interest thereon. (2) This policy shall stand cancelled in case the life assured shall die before the date of commencement of risk and in such event, provided the policy is then in full force, a sum of money equal to all the premiums paid without any deduction whatsoever, shall become payable to the person entitled to the policy moneys. (3) All moneys payable in terms of these provisions, shall, if the policy has vested in the Life Assured, be payable to the Life Assured, his/her assignees or nominees under Section 39 of the Insurance Act or proving Executors or Administrators or other Legal Representatives who should take out representation to his/her estate or limited to the amount of moneys payable under the within policy from any Court of any State or Territory of the Union of India. Provided always that if the policy has not vested in the Life Assured, the moneys in terms of these provisions shall become payable to the proposer, his/her Proving Executors or Administrators or other Legal Representatives who should take out representation to his/her estate or limited to the moneys payable under these provisions from any Court or any State or territory of the Union of India.

FROM a bare reading of para 2 of the Special Provisions it is clear that the policy shall stand cancelled in case the life assured dies before the date of commencement of risk and in such event, provided the policy is then in full force, a sum of money, equal to all premiums paid without any deduction whatsoever, shall become payable to the person entitled to the policy moneys. The policy of the table 113 covers risk only on the date of the commencement of risk which commences only after two years from the date of commencement of policy or the child attaining the age of 7 years, whichever is later. The contention that the book of table 113 was not given to the complainant/respondent cannot be accepted as he gave proposal of the Children''s Money Back Assurance without profit which is only of table 113 and wherein the commencement of risk was clearly given. In view of the above order of the District Forum cannot be sustained. However, the appellant though has offered the amount of the premium deposited but it was not paid nor deposited with the District Forum, therefore, we direct the appellant to refund the amount of Rs. 2,619/- with interest at the rate of 12% p.a. from 2.5.1996 within a period of two months from the date of receipt of certified copy of this order, failing which the interest shall be payable at the rate of 15% p.a.

ACCORDINGLY, the appeal is allowed, the order of the District Forum is set aside. In the circumstances, parties to bear their own costs. A copy of this order be conveyed to the parties and a copy be sent to the District Forum alongwith the record of the case. Appeal allowed.