Gajanan Maharaj Junior College And Mcvc vs Purushottam Sitaramji Dadgal

VAKALATNAMA on behalf of respondent nos. 1 to 5 is taken on record. Late Sh. Vilas Dadgal, who was working with Gajanan Maharaj Junior College and MCVC as a teacher, had taken three insurance policies, one of Rs. 50,000/ -, the second of Rs. 51,000/ - and the third one of Rs. 1 lakh from LIC of India. The complainants in this case were his nominees under the aforesaid policies. The employer of late Sh. Vilas Dadgal, petitioner before us was required to deduct the premium from his salary and deposit the same with LIC of India. The grievance of the complainants is that the petitioner did not deposit the premiums after the year 1999. On 13.04.2001, LIC of India informed Sh. Vilas Dadgal to pay the premium of December, 1999 since it had not been paid by his employer. Thereupon the Principal of the College deducted Rs. 4,135/ - from his salary for the period December, 1999 to October, 2000, but did not deposit the aforesaid amount with the LIC of India, as a result of which the policies lapsed. The deceased wanted to seek revival of the policies and had also obtained a quotation in this regard on 10.05.2003, but he died in an accident on 22.05.2003 before the policies could be revived. The complainants, therefore, approached the concerned District Forum, seeking directions to all the opposite parties, i.e. his employers and LIC of India to pay the sum assured and other benefits to them alongwith interest, compensation and cost of litigation.

THE LIC of India took the stand that only paid up value could be paid to the respondent in respect of the two policies, but nothing was payable in respect of the third policy which was a Bima Kiran Policy. The petitioner resisted the complaint on the ground that the premium could have been paid by it only after making deductions from his salary, which used to come from Deputy Director of Education and the premiums were paid as per the irregular receipts of the grant of the Government. It was further stated in the reply that the salary of December, 1999 was received in April, 2000 and therefore, the premium deducted from the salary was sent to the LIC of India on 25.04.2000, which the corporation did not accept since late fee had not been paid. The matter was brought by them to the knowledge of the deceased policy holder, who was asked to revive the policies.

VIDE its order dated 22.11.2005, the District Forum partly allowed the complaint by directing the opposite parties no. 1 and 2 i.e. LIC of India to pay the amount lying with them to the complainants. The opposite parties no. 1 and 2 were also directed to pay interest on the aforesaid deposit at the rate of 7% per annum alongwith cost quantified at Rs. 1,000/ -. Being aggrieved from the order passed by the District Forum, the complainants as well as the LIC of India filed two separate appeals. Vide impugned order dated 17.11.2014, the State Commission partly allowed both the appeal and directed the LIC of India to pay, to the nominees, the eligible paid up value without interest. The opposite party no. 3, i.e. the petitioner College, was directed to pay the insured value of all the three policies to the complainants without any interest. Being dissatisfied with the order passed by the State Commission, the employer of the deceased is before us by way of this revision petition. The LIC of India, however, has not challenged the order passed by the State Commission.

IT is not in dispute that as per the arrangement between the insured and the petitioner, the premium payable to LIC of India in respect of the insurance policies taken by the deceased was to be deducted by the petitioner and remitted to LIC of India. It is also not in dispute that the petitioner failed to remit the requisite premium to LIC of India which resulted in the aforesaid policies getting lapsed. The only justification given by the petitioner for not remitting the premium to the LIC is that the grants from the Government having been received late, the salary to the deceased came to be disbursed late and therefore the premium could not be paid to the LIC of India in time. We are in agreement with the State Commission that the deceased being their employee, the petitioner before us was under an obligation to make timely payment of the salary to him irrespective of whether they received grant from the Government in time or not. They having employed the deceased, it was for them to arrange necessary funds to pay the salary of the teachers engaged by them. Had the petitioner paid salary to the deceased in time they would also have deducted the premium from his salary and remitted the same to LIC of India, well in time. In that case, the insurance policies taken by the deceased would not have lapsed. In any case, the petitioner was fully aware that it is under an obligation to remit the amount of premium to the LIC of India and in the event of its failure to remit the premium, the policy taken by the deceased would lapse. Therefore, even if the petitioner did not have sufficient funds to pay the salary in time, at least the premium payable to LIC of India should have been remitted well in time and on receipt of the grant from the Government for the aforesaid premium could have been deducted from the salary of the deceased.

WE also take note of the fact that the State Commission did not award any interest to the complainant despite the fact that had the policies not lapsed, the deceased would have received the payment from the LIC of India some time in the year 2003. The order by the State Commission came to be passed on 17.11.2014, meaning thereby that the complainants had been deprived of interest for as many as 11 years. The interest on the total insured amount of Rs. 2,01,000/ -, even at the modest interest of 9% per annum would have been about Rs. 2 lakhs in 11 years. Therefore, the paid up value which the complainants will get over and above the insured amount of Rs. 2,01,000/ - would only partly offset the loss sustained by them in the form of interest on Rs. 2,01,000/ - for as many as 11 years.

NO other contention has been advanced before us. Therefore, we need not go into other possible legal issues. Considering all the facts and circumstances of the case, we find no good ground to interfere with the order passed by the State Commission. The revision petition is accordingly dismissed. The deposit made by the petitioner with the District Forum in compliance of our order dated 13.03.2015 shall be forthwith released to the complainants in equal share. The balance amount shall be paid by the petitioner to them in equal shares by way of pay orders/demand drafts in their names, within four weeks from today, failing which it shall carry interest at the rate of 12% per annum from the date of this order. The revision petition stands disposed of.