NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION NEW DELHI REVISION PETITION NO. 1380 OF 2011 (Against the Order dated 18/03/2011 in Appeal No. 1569/2005 of the State Commission ) 1. JASBIR KAUR & ORS. Residents of H. No. 561, Street No. 9, Sharifpura, Rani Bazar 2. BABY SALONI, D/O. LATE PRITPAL SINGH Residents of H. No. 561, Street No. 9, Sharifpura, Rani Bazar 3. BAY SIMRAN, D/O. LATE PRITPAL SINGH Residents of H. No. 561, Street No 9, Sharifpura, Rani Bazar...Petitioner(s) Versus 1. LIC OF INDIA & ORS. Through Its Chairman/Director/Official Concerned, At City Centre Scheme 2. THE DIVISIONAL MANAGER, LIFE INSURANCE CORPORATION OF INDIA At City Centre Scheme 3. THE MANAGER (CLAIMS), LIFE INSURANCE CORPORATION OF INDIA At City Centre Scheme...Respondent(s) BEFORE: HON'BLE DR. B.C. GUPTA,PRESIDING MEMBER HON'BLE MR. PREM NARAIN,MEMBER -1-
For the Petitioner : For the Respondent : Dated : 23 Feb 2017 Mr. Pankaj Malik, Advocate with Mr. J.Malik, Advocate Mr. U.C.Mittal, Advocate with Mr. Abhay Gupta, Advocate ORDER 1. The present revision petition has been filed by the petitioners/complainants under Section 21(b) of the Consumer Protection Act, 1986, challenging the order dated 18.3.2011 passed by the State Consumer Disputes Redressal Commission, Chandigarh (hereinafter referred to as the State Commission ) in F.A. No. 1569/2005. Partly accepting the appeal, the impugned order modified the order dated 19.5.2005 passed by the District Consumer Disputes Redressal Forum, (hereinafter referred to as the District Forum ) in C.C. No. 523/2004. 2. The brief facts of the case are that Sh. Pritpal Singh (now deceased; hereinafter referred to as the insured ) obtained a policy bearing No. 471072577 (hereinafter referred to as Policy No.1) dated 14.09.2002 and Policy No. 471084006 (hereinafter referred to as the Policy No.2) dated 15.06.2003 for a sum of Rs. 2,00,000/- and Rs. 3,00,000/-respectively. The premiums for the two policies were duly paid by the insured. However, on 13.7.2003, the insured started feeling some uneasiness after returning home. The insured was rushed to the Talwandi Hospital, but the doctors who attended the insured advised that he should be taken immediately to Guru Nanak Dev Hospital and he was accordingly shifted. But he was declared dead on arrival there. On the next date i.e. 14.7.2003, the post mortem was conducted in the Forensic Medicine and Toxicology Department in Government Medical College,, and cause of death was stated to be tuberculosis of lungs. It is the case of the complainants that the in-laws of complainant No.1 started leveling false allegations on the complainant No.1 and at their instance, the matter was reported to the police. The police had recorded in its report that the complainant No.1 informed that the life assured was suffering from heart problem. Complainant No.1 alleged that she was not in her senses at the time of death of her husband and had not given any statement with respect to the health of her husband/the insured except that the insured felt chest pain for two days prior to his death. Complainant No.1 alleged that the statement before the police had been manipulated in order to deprive the Complainant Nos.1, 2 and 3 of their legitimate right of claiming the insurance amount on false and frivolous ground that the deceased was suffering from heart ailment. The claim was lodged with the O.Ps. but the same was repudiated vide letter dated 18.3.2004. On representation, the O.P. in the written reply dated 30.4.2004, informed that the claims of the complainants were rejected by the O.Ps. on account of insured withholding material information regarding his health at the time of taking the policy. We, therefore, allow the present complaint and direct the opposite parties to pay the amount of insurance policies to the complainant along with interest @ 12% p.a. from the date of repudiation of the claim. The opposite parties are also directed to pay Rs. 10,000/- as compensation which amount would be paid by those officers who have unjustly repudiated the claim of the complainant. Opposite parties are further directed to pay Rs. 2,000/- as litigation expenses. Entire amount would be paid to all the three 3. Aggrieved by the repudiation by the O.Ps., the complainants filed a complaint before the District Forum. The District Forum vide order dated 19.5.2005 allowed the complaint as under:- -2-
complainants in equal shares. The amount which would fall to the shares of the complainants Nos. 2 and 3 would be deposited in the FDR in any nationalized bank till the time both these minor attain majority and no amount from these FDRs would be withdrawn without the permission of the District Consumer Forum,. 4. Aggrieved by the aforesaid order, the O.Ps. preferred an appeal before the State Commission. The State Commission vide order dated 18.3.2011 partly allowing the appeal, held as follows:- 38. In view of the facts and circumstances of this case and in view of the law relating to the subject. This appeal is partly accepted and the impugned judgement dated 19.5.2005 is modified. The insurance claim relating to the insurance claim No. 471072577 dated 14.9.2002 for an amount of Rs. 2 Lacs is upheld while the insurance claim relating to life insurance policy No. 471084006 dated 15.6.2003 for an amount of Rs. 3 Lacs is set aside and the repudiation of this claim is upheld with interest @ 9% p.a. Costs are also upheld. 5. Aggrieved by the said order, the complainants have approached this Commission by way of the present revision petition. 6. Heard the parties and perused the records. 7. Learned counsel for the petitioners stated that the State Commission has allowed the insurance claim of one policy dated 14.09.2002 for an amount of Rs.2,00,000/-, whereas, it has denied the claim for the second policy dated 15.06.2003 for an amount of Rs.3,00,000/-. Prior to the subscription of the Policy Nos. 1 and 2, the insured was thoroughly checked up by a panel of doctors of the O.P. No.1, and was found to be in perfect health. Both the policies were repudiated by the Insurance Company on the same ground, but the learned State Commission has allowed claim of one policy and had denied the claim of other policy, whereas, the District Forum had allowed the claim of both the policies. The claim of the policy dated 15.06.2003 for Rs.3,00,000/- has been denied by the State Commission, on the first ground that in DDR No.25 dated 13.7.2003, the complainant has allegedly made a statement that her husband had also suffered heart attack roughly two years back. The State Commission also relied upon the majornama of the residents of the same locality mentioning that the insured had suffered a heart attack and had also suffered heart attack two years back. The fact of the matter is that the person who actually wrote the DDR has not been examined nor the statement allegedly signed by the complainant no.1 has been filed. As the husband of the complainant no.1 died on the same day and the complainant was not in a stable condition, her statement cannot be given any importance and it cannot be relied. Similarly, majornama signed by only 15-16 people of the locality cannot be taken as evidence. The Insurance Company may have collected this for specific purpose of proving that the insured was suffering from heart disease with an intention to repudiate the claim. From this point of view, this cannot be considered as a piece of independent and credible evidence. 8. It was also submitted by the learned counsel that the cause of death as reported in the post mortem report is Tuberculosis of lungs (TB). Therefore, all the theory of the insured suffering from heart ailment is falsified by this report alone. Clearly the insured was not aware of TB and therefore, there is no question of suppression of any material information regarding his health. -3-
9. On the other hand, the learned counsel for the respondents stated that the policy was taken on 15.06.2003 and the insured died on 13.07.2003. As the insured died within one month of the inception of the policy, the matter was internally inquired and it was found that the patient had heart disease and had suffered heart attack earlier also. The complainant no.1 has given statement herself to the Police in connection with some dispute of the complainant no.1 with her in-laws on the day of the death of her husband that her husband had heart attack two years back also, perhaps to establish that the sudden death has occurred due to heart attack and not on account of any other reason caused by her. It has come in the evidence that she had given her statement in writing to the Police Station, but the same has not been filed here. However, there has been examination-in-chief and cross-examination of AMHC Balkar Singh, and he has clearly stated that DDR No.25 dated 13.07.2003 was filed on the basis of the statement made by the complainant no.1. The respectable neighbourers of the same locality could not give any false statement even on persuasion of the Insurance Company. The State Commission has rightly considered the DDR No.25 dated 13.07.2003 and majornama signed by the residents of the same locality to establish that the insured was suffering from heart disease and had heart attack two years back, but the insured did not mention the same in the proposal form. Thus, the insured had clearly suppressed material information and fact relating to his health while filling the proposal form. The policy has not run for two years and therefore, the benefit of Section 45 of the Insurance Act is also not available in the present case. Hence, the repudiation is in order and the State Commission has rightly held that complainants are not entitled to claim relating to policy dated 15.06.2003. 10. We have carefully considered the arguments of both the parties and have examined the record. Police record is the Government record and can be considered as an independent and reliable evidence. Though complainant s statement in writing is not on record, but based on that DDR has been written by a functionary of the Police Station and there is no reason why the same should not be believed. Complainants have not shown any evidence that the person who wrote the DDR or some other employee of the Police Station had ill-will towards the complainants and/or was misguided by the opposite parties while writing DDR No.25 dated 13.07.2003. The State Commission has referred to the statement of the complainant signed by her and the same has been exhibited. Thus the signed statement by the complainant No.1 cannot be denied. Accordingly, it becomes clear that the complainant No.1 has herself admitted that her husband had suffered a heart attack two years ago and she cannot refute the same now. 24. It was further submitted by the learned counsel for the respondents that the dead body of Pritpal Singh life assured was subjected to post mortem examination. A copy of the post mortem report issued by the Forensic Medicine & Toxicology Department, Government Medical College, has been proved as Ex.C6, according to which, the life assured had died due to tuberculosis of lung which was sufficient in the ordinary course of nature to cause death. Therefore, the cause of death was not related to heart attack. 11. We have to examine the fact whether the insured suppressed any material information from the insurer. Whether the death occurred due to TB or due to heart attack, the information in regard to none was given in the proposal form. The State Commission, has dealt with this question in its right earnest as would be seen from the following observations made by the State Commission in its order dated 18.03.2011:- -4-
25. This submission has been considered. 26. However, in some of the documents namely DDR, the claim form filled by Jasbir Kaur respondent No.1, document Ex.R9 which was a certificate of Identity and Burial Cremation and the claimants statement duly signed by Jasbir Kaur respondent No.1 Ex.R10, the cause of death of Pritpal Singh was stated as due to heart attack whereas it is not specifically clear in the report Ex.C6 if the life assured died by TB of lungs. In any case, whether the life assured had died by heart attack on 13.7.2005 or whether he had died by suffering the disease of TB, the material thing is that he was suffering from the heart ailment about 2 years prior to the filing of the proposal form on 14.6.2003 (Ex.R13). It was suppressed by him while filling the proposal form and it was not disclosed in the proposal form. 12. We agree with the above observations of the State Commission in the light of the decision of the Hon ble Supreme Court in the matter of Satwant Kaur Sandhu Vs. New India Assurance Co. Ltd., 2009 INDLAW SC 856, wherein following has been observed:- [A] Insurance- Material fact- Meaning of Term material fact is not defined in Act- In general terms it means as any fact which would influence judgment of a prudent insurer in fixing premium or determining whether he would like to accept risk- Held, in a Contract of Insurance, any fact which would influence mind of a prudent insurer in deciding whether to accept or not to accept risk is a material fact - Appeal dismissed. [C] Consumer Protection- Insurance- Mediclaim policy- Repudiation of Mis-representation and suppression of material facts regarding health made by policy holder-non-disclosure of fact in proposal form at time of taking out mediclaim policy, that policy holder was suffering from chronic Diabetes and Renal failure fact- Whether factum of said illness was a material fact for purpose of a mediclaim policy and its non-disclosure was tantamount to suppression of material facts enabling Insurance Company to repudiate its liability under policy?- Mediclaim is a contract of insurance falling in category of contract uberrimae fidei, meaning a contract of utmost good faith on part of assured- When an information on a specific aspect is asked for in proposal form, an assured is under a solemn obligation to make a true and full disclosure of information on subject which is within his knowledge-any inaccurate answer will entitle insurer to repudiate his liability because there is clear presumption that any information sought for in proposal form is material for purpose of entering into a Contract of Insurance- Held, statement made by insured in proposal form as to state of his health was palpably untrue to his knowledge- There was clear suppression of material facts in regard to health of insured and, therefore, respondent-insurer was fully justified in repudiating insurance contract- Appeal dismissed. 13. From the order of the State Commission it is clear that the first policy dated 14.09.2002 for Rs.2,00,000/- has been allowed because no proposal form for that policy had been filed by the opposite party/insurance Company and suppression of fact cannot be established. The claim for the second policy dated 15.06.2003 has been rejected by the State Commission because the insured has not given any information regarding his heart ailment in the proposal form, whereas the complainant no.1 herself has admitted that her husband got heart attack two years back. Therefore, we do not find any force in the argument of the petitioner that the State Commission should have allowed the second policy also as it had allowed the first one. -5-
14. Based on the above discussion, we find no illegality, material irregularity or jurisdictional error in the order dated 18.03.2011 of the State Commission, which calls for any interference from this Commission. Accordingly, Revision Petition No.1380 of 2011, Jasbir Kuar & Ors. Vs. Life Insurance Corporation of India & Ors. is dismissed. No order as to cost for this revision petition.... DR. B.C. GUPTA PRESIDING MEMBER... PREM NARAIN MEMBER -6-