Consumer forum imposes Rs 5K penalty on MCD

A consumer forum has imposed a penalty of Rs 5,000 on Municipal Corporation of Delhi (MCD) for not paying monthly installments of an LIC policy of one of its employees, holding it guilty of "deficiency in service".
A bench of North District Consumer Disputes Redressal Forum, presided by K S Mohi, held that MCD was negligent in deducting the monthly installments from the employee's salary due to which the insurance policy of Ghaziabad resident Bhajan Lal had lapsed.
"The documents placed on record by the parties clearly demonstrate that Opposite Party 1 (MCD) was negligent in not deducting the monthly installments from the salary of complainant (Lal) for the purpose of depositing the same with Opposite Party 2 (LIC) resulting in 23 gaps of installment as pointed out by Opposite Party 2.

"Opposite Party 1 has categorically admitted his mistake in not depositing the regular installments with Opposite Party 2 and this amounted to deficiency in service," the forum said.
It said "ends of justice would be met if Opposite Party 1 is directed to make entire payment of its own, including penalty and revival expenses, if any...To Opposite Party 2."
It also said that MCD was at liberty to deduct the arrears of installments towards LIC policy from Lal's salary in such a manner that the money is realised before superannuation of the complainant.

"In the light of peculiar circumstances we deem it fit to award Rs 5,000 to be paid by Opposite Party 1 (MCD) towards harassment and litigation expenses," it said.

According to the complaint, Lal, the MCD staffer, was holding a policy of Life Insurance Corporation of India for Rs 50,000.
For this policy, MCD deducted Rs 330 from Lal's salary every month, it said, adding that he received a notice from LIC regarding lapse of 23 installments.
He approached MCD in this regard but nothing was done, forcing him to approach the forum seeking a direction to the civic body to deposit the unpaid installments of Lal's policy and direct the LIC to issue the receipt.