D M EKANATHAPRASANNA Vs. LIFE INSURANCE CORPORATION OF INDIA

JUDGEMENT

(1.) Petitioner took Jeevan Anand policy bearing No. 622484684 on 20/22.12.2004 and paid first premium of Rs. 50,104/-. Further premiums due from 12/2005 were not paid. On 22.02.2011, petitioner represented to the 2nd respondent, to permit the revival of the lapsed policy or return the first premium amount paid. Respondents, in their reply dated 23.02.2011, informed the petitioner that the policy cannot be revived since the policy lapsed for more than 5 years and the policy, also, cannot be surrendered since the policy has not run for three years. Petitioner got served on the respondents a legal notice dated 09.03.2011, to return the first premium amount of Rs. 50,104/-. Respondents having repudiated the claim by a reply dated 21.03.2011, on the ground that the advance premium paid is utilized for risk cover for that one year, this writ petition has been filed to direct the respondents to return the first premium amount of Rs. 50,104/-. Statement of objections was filed by the respondents, in justification of the replies sent to the petitioner on 23.02.2011 and 21.03.2011 and seeking dismissal of this petition.

(2.) Sri Shankaranarayana Bhat, learned advocate, contended that the action of the respondents in forfeiting the first premium amount paid, by relying on condition No. 4 mentioned in the policy issued, is arbitrary and illegal. By placing reliance on the decision in the case of Huchappa and another v. Union of India and others, 2007 ILR(KAR) 602, he contended that condition No. 4 mentioned in the policy bond having been held to be void and without any basis and a direction having been issued to return the premium amount to the discontinued policy holder, if the policy is not revived, the respondents are legally bound to return to the petitioner, the first premium amount of Rs. 50,104/-.

(3.) Sri G. Nataraj, learned advocate, on the other hand contended that the petitioner having paid the first premium only and having not paid the subsequent premiums due from 12/2005 upto 2011, represented on 22.02.2011, that he is willing to revive the policy and if revival is not permissible, to return the premium amount paid. He submitted that in view of clause 4 printed under the 'conditions and privileges' on the back of the policy bond issued to the petitioner, the amount paid as first premium being not returnable, a reply dated 21.03.2011 was sent and that the respondents are justified in refusing to refund the premium amount. He submitted that the petitioner having entered into contract of insurance, is bound by the terms and conditions, which are set forth in the bond and agreement and the advance amount paid by the 'life assured' has been utilized for risk cover for the year 2005-2006. He further submitted that the order passed in the case of Huchappa , was questioned in W.A. No. 254/2007 and the appeal was allowed in part on 28.01.2011 and the impugned order passed by the learned Single Judge, insofar as it related to the declaration made that forfeiture of amount in the policy which had lapsed within three years is void and cannot be enforced and that the policy holder is entitled to the premium amount paid till the date of default was set aside. Learned counsel submitted that this writ petition being devoid of merit may be dismissed.