• Posted by CERC India
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New India Assurance told to pay up unfairly deducted sum


Amrat I. Patel, a businessman residing in Ahmedabad, took a Hospitalisation Benefit Policy for himself and his wife Sharda for Rs. 1.25 lakh each from New India Assurance Co. Ltd. During the validity period, Sharda was hospitalised from 18 July 2011 to 20 July 2011 for surgery owing to stones in the ureter and kidney. The medical expenses came to Rs. 65,762 and accordingly a claim was submitted. Without giving a proper reason, the insurer sanctioned only Rs. 30,172. Patel accepted the amount under protest and sought an explanation from the insurer. Not receiving a positive response, Patel approached CERS.

When mediation and a legal notice did not evoke a suitable response, a case was filed in the Consumer Forum. The insurance company contended that the amounts charged by the surgeon and anaesthetist would not be paid as it was not part of the main hospital bill. Patel stated that he had not been informed about these terms and conditions at the time of taking the policy. The Forum ruled in favour of the complainant. In its order dated 17 October 2014, it asked the insurer to pay Patel the deducted sum of Rs. 35,590 within 60 days. If there was delay it would have to pay interest at 9%. The Forum also awarded Rs. 3,000 as compensation for mental harassment and towards costs.

Those who buy shares as an investment are consumers


Arpitha Reddy paid Rs. 1 lakh by cheque and Rs. 1.40 lakh in cash to buy shares of Venve Light Metal Ltd. The company decided to allot shares to Arpitha at its Board Meeting held on 31 January 2001. But the company did not issue the shares. Arpitha sent a legal notice to the company, which responded by asking her to give details of the payments. The company admitted it had received the cash, but claimed that the cheques had not been realised and the agreement had been fabricated by Arpitha’s husband. Arpitha filed a complaint before the Hyderabad District Forum. The company now said that it had already allotted 10,000 shares of Rs. 10 each for the amount of Rs. 1 lakh.

The Forum dismissed the complaint but Arpitha filed an appeal. The Andhra Pradesh State Commission said the company had failed to produce any documents to show that the shares had been received by Arpitha. It set aside the Forum’s order and directed the company to pay Rs 2.40 lakh, along with 9% interest and costs of Rs 2,000. A revision petition was filed by the company before the National Commission. The company claimed that buying of shares is a purely commercial transaction and would fall outside the purview of the Consumer Protection Act. In its order dated 1 August 2014, the National Commission said that while those who trade in shares are not consumers, those who buy shares as an investment are consumers. Accordingly, the revision petition was dismissed and the order of the State Commission confirmed. The National Commission also imposed a fine of Rs. 10,000 on the company to be paid to legal aid.

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