National Consumer Disputes Redressal
Subinoy Majumdar vs Life Insurance Corporation Of India, ... on 12 May, 2016
NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION NEW DELHI REVISION PETITION NO. 3339 OF 2014 (Against the Order dated 29/05/2014 in Appeal No. 64/2013 of the State Commission Tripura) 1. SUBINOY MAJUMDAR S/O. - LATE SUSHIL MAJUMDAR VILL, G.B.BAZAR, P.O.-KUNJABAN PS- EAST AGARTALA, WEST TRIPURA ...........Petitioner(s) Versus 1. LIFE INSURANCE CORPORATION OF INDIA, AGARTALA BRANCH II & 2 ORS. AGARTALA BRANCH -II REPRESENTED BY BRANCH MANAGER THAKURPALLI ROAD KRISHNANAGAR, AGARTALA TRIPURA 2. DIVISIONAL MANAGER LIFE INSURANCE CORPORATION OF INDIA SILCHAR DIVISION CLAIMS DEPARTMENT, MEHERPUR SILCHAR-788015 3. LIFE INSURANCE CORPORATION OF INDIA REPRESNTED BY ITS CHAIRMAN AND MANAGING DIRECTOR FIRST FLOORYOGAKESHEMA CENTRAL OFFICE JIVAN BHIMA MARG PBNO. 19953, NARIMAN ROAD MUMBAI-400021 MAHARASHTRA ...........Respondent(s)
BEFORE: HON'BLE MR. JUSTICE AJIT BHARIHOKE, PRESIDING MEMBER HON'BLE MRS. REKHA GUPTA, MEMBER For the Petitioner : Mr. Upender Pratap, Advocate For the Respondent : Mr. Ashok Kashyap, Advocate Dated : 12 May 2016 ORDER Petitioner/Complainant has filed the present (Revision Petitions against the Respondent/Opposite Parties--Life Insurance Corporation of India for setting aside the impugned order dated 29.5.2014 passed by the State Consumer Disputes Redressal Commission, Tripura, Agartala (for short, 'State Commission') in First Appeal Nos.64 & 65 of 2013)
2. The impugned order being a common order passed in (First Appeal No. 64 of 2013) which was filed against the judgment and award dated 21.10.2013 passed by the District Consumer Disputes Redressal Forum, West Tripura: Agartala( For short, 'District Forum') in Complaint Case No.19 of 2013 and First Appeal No.65 of 2013 filed on the same date directed against the Judgment and award dated 21.10.2013 by the District Forum in Complaint Case No.20 of 2013. We proposed to give a common order.
3. The facts of the case of (C.C. No.19 of 2013) as per the Petitioner/Complainant are that his wife Ratna Das had obtained a life Insurance Policy bearing No.4927227598 from the respondents w.e.f. 28.03.2010 to 28.03.2024 with an annual premium of Rs.17,741/- for an assured amount of Rs.2,00,000/-. The O.Ps after enquiry and observing all formalities issued the policy in favour of Ratna Das on taking premium of Rs.17,741/-. During the existence of the policy, Ratna Das unfortunately died on 08.11.2010, due to Septicemia. Petitioner was made nominee of the policy, so after the death of Ratna Das, he claimed the assured amount from the OPs. The O.Ps dragged the matter and ultimately refused to pay any amount stating that the claim of the petitioner had been repudiated. The petitioner therefore, approached the District Forum claiming compensation.
4. The Respondents/Opposite Parties contested the case by filing written objection. The respondents admitted having issuance the policy bearing no.4927227598 in favour of the deceased Ratna Das. They also admitted that the yearly premium of the same was Rs.17,741/- and the policy was for 14 years w.e.f 28.03.2010 to 28.03.2024. They also admitted that Ratna Das died on 08.11.2010 but stated that at the time of filling up the proposal form Ratna Das suppressed material facts. She was suffering from diabetes but she did not disclose the same at the time of filling the proposal form. The respondents have stated that as the deceased suppressed the material particulars and did not disclose her ailments at the time of obtaining the policy, the respondents were compelled to repudiate the policy and in doing so they did not commit any deficiency in service and as such the complainant is not entitled in any compensation.
5. Facts of the C.C. No. 20 of 2013 as per the Petitioner/ Complainant are that his wife Ratna Das had obtained a life Insurance Policy bearing No.492560611 from the respondents w.e.f. 27.01.2010 to 27.01.2026 with an annual premium of Rs.26,422/- for an assured amount of Rs.5,50,000/-. The respondents after enquiry and observing all formalities issued the policy in favour of Ratna Das on taking premium of Rs.26,422/-. During the existence of the policy, Ratna Das unfortunately died on 08.11.2010, due to Septicemia. Petitioner was made nominee of the policy so after the death of Ratna Das, he claimed the assured amount from the OP. The O.Ps dragged the matter and ultimately refused to pay any amount stating that the claim of the petitioner has been repudiated. The petitioner therefore, approached the District Forum claiming compensation.
6. The Respondents/Opposite parties contested the case by filing written objection. The O.Ps admitted issuance of policy bearing no.492560611 in favour of the deceased Ratna Das. They also admitted that the yearly premium of the same was Rs.26,422/- and the policy was for 16 years w.e.f 27.01.2010 to 27.01.2026. They admitted that Ratna Das died on 08.11.2010 but stated that at the time of filling up the proposal form Ratna Das suppressed material facts. She was suffering from diabetes but she did not disclose the same at the time of filling the proposal form. The O.P.s have stated that as the deceased suppressed the material particulars and did not disclose her ailments at the time of obtaining the policy, the O.Ps. were compelled to repudiate the policy and in doing so they did not commit any deficiency in service and as such the complainant is not entitled in any compensation."
7. Both the complaints were allowed by the District Forum. In C.C. No.19 of the 2013, the District Forum, while allowing the complaint, vide its order dated 21.10.2013 held that;
" Branch Manager of LIC Branch No.2 Kamala Kanta Jena has been examined in this case who in his deposition has stated that the LIC has panel Medical Officers but the insured was not examined by panel medical officer of the company. It is not understood why at the time of filling up the form the insured was not examined by the panel medical officer or why she was not asked to undergo pathological Test to satisfy the Insurance Company regarding ailments of the insured before issuance of the policy. The Policy was accepted by the Insurance Company on being satisfied after filling up the form by the insured. On perusal of the policy form we find that only the signature of the insured was obtained and it was filled up by the agent of the Insurance company. We are in dark whether the insured was asked to disclose about her ailments and whether she has suppressed her ailments. Moreover, the documents submitted by the Insurance company nowhere shows that she was suffering from diabetes prior to taking of the policy. The photo copy of the prescription submitted on behalf of the complainant is also not satisfactory. The medical officer who issued the certificate has not been examined to confirm whether the said prescription was issued by him in favour of the deceased Ratna Das and that she was suffering from diabetes for last one year. Rather from the documents of the hospital where insured died it revealed that she died due to septicaemia and not for diabetes. DM-2 diabetes is a common disease now-a-days. A good number of citizens of India are now suffering from DM-2 type diabetes. The hospital record did not disclose that insured died due to diabetes rather documents disclosed that insured died due to septicaemia. The opposite party failed to establish that prior to taking the policy the insured was suffering from diabetes and she died as a result of diabetes. As the Opposite Parties failed to establish that the death of deceased was caused due to diabetes their action in repudiating the claim appears to be unjustified and as such they are liable to pay the assured amount to the complainant.
In the result the petition is allowed on contest. The Opposite Parties are hereby directed to pay the assured amount of Rs.2,00,000/- to the complainant within a period of 30 days from the date of judgment. O.Ps are also directed to pay a sum of Rs.1,000/- towards the cost of litigation. If the Opposite Parties failed to pay the amount within 30 days the amount shall carry interest @ 9% P.A. after the expiry of 30 days till the payment is made.
We are in dark whether deceased has left any children as her legal heir. If she has any surviving children then the assured sum should be distributed equally amongst her legal heirs."
8. In C.C. No.20 of the 2013, District Forum vide its order dated 21.10.2013; the following order was passed;
" Branch Manager of LIC Branch No.2 Kamala Kanta Jena has been examined in this case who in his deposition has stated that the LIC has panel Medical Officers but the insured was not examined by panel medical officer of the company. It is not understood why at the time of filling up the form the insured was not examined by the panel medical officer or why she was not asked to undergo pathological Test to satisfy the Insurance Company regarding ailments of the insured before issuance of the policy. The Policy was accepted by the Insurance Company on being satisfied after filling up the form by the insured. On perusal of the policy form we find that only the signature of the insured was obtained and it was filled up by the agent of the Insurance company. We are in dark whether the insured was asked to disclose about her ailments and whether she has suppressed her ailments. Moreover, the documents submitted by the Insurance company nowhere shows that she was suffering from diabetes prior to taking of the policy. The photo copy of the prescription submitted on behalf of the complainant is also not satisfactory. The medical officer who issued the certificate has not been examined to confirm whether the said prescription was issued by him in favour of the deceased Ratna Das and that she was suffering from diabetes for last one year. Rather from the documents of the hospital where insured died it revealed that she died due to septicaemia and not for diabetes. DM-2 diabetes is a common disease now-a-days. A good number of citizens of India are now suffering from DM-2 type diabetes. The hospital record did not disclose that insured died due to diabetes rather documents disclosed that insured died due to speticaemia. The opposite party failed to establish that prior to taking the policy the insured was suffering from diabetes and she died as a result of diabetes. As the Opposite Parties failed to establish that the death of deceased was caused due to diabetes their action in repudiating the claim appears to be unjustified and as such they are liable to pay the assured amount to the complainant.
In the result the petition is allowed on contest. The Opposite Parties are hereby directed to pay the assured amount of Rs.5,50,000/- to the complainant within a period of 30 days from the date of judgment. O.Ps are also directed to pay a sum of Rs.1,000/- towards the cost of litigation. If the Opposite Parties failed to pay the amount within 30 days the amount shall carry interest @ 9% P.A. after the expiry of 30 days till the payment is made.
We are in dark whether deceased has left any children as her legal heir. If she has any surviving children then the assured sum should be distributed equally amongst her legal heirs."
9. The State Commission vide its common order dated 29.05.2014, while allowing both the appeals observed as under;
" 16. Both the polices are non-medical in nature. The learned counsel drawing our attention to the chapter IX of non-medical business at page 121 of the Under Writing Manual of the LICI submitted that the assured Ratna Das aged about 45 years Branch Manager/Grade III offier of the Tripura State Co-operative Bank Ltd. and a graduate as mentioned in the proposal forms were considered as non-meidcal case. He also submitted that in a non-medical case the medical test before acceptance of the proposal for issuance of the policy is not compulsory and in that case the insurance company relies upon the statement, information which are in his/her exclusive knowledge furnished by the proposer in the proposal forms and the insurance company acts on this information on good faith. He also submitted that referring to Regulation 2(1) (d) of the Insurance and Development Authority(Protection of Policy Holders' Interest)Regulations,2002 that 'proposal form' means a form to be filled in by the proposer for insurance, for furnishing all material information required by the insurer in respect of a risk, in order to enable the insurer to decide whether to accept or decline, to undertake the risk, and in the event of acceptance of the risk, to determine the rates, terms and conditions of a cover to be granted. He also submitted that the 'material' for the purpose of the said regulations shall mean and include all important, essential and relevant information in the context of under writing the risk to be covered by the insurer and also to decide whether to undertake the risk or not. He also submitted that in a contract of insurance, any fact which would influence the mind of a prudent insurer in deciding whether to accept or not to accept the risk is a material fact. It the proposer has knowledge of said fact, he is obliged to disclose it particularly while answering question in the proposal form and any inaccurate answer will entitle the insurer to repudiate its liability because there is clear presumption that any information sought for in the proposal form is material for the purpose of entering into a contract of insurance.
19. Question may arise as to what was the authenticity in respect of said two medical prescriptions dates 20.04.2010 and 23.04.2010. In this regard the deposition of claimant/complainant Subinoy Majumdas As PW 1 in both the complaint case is very vital. This Subinoy Majumdar as PW 1 stated in his cross-examination in case No.C.C. 19/2013 that " it is true that on 20.02.2010 and 23.04.2010 I got my wife checked up in Apollo Gleneagles Hospital, Kolkata and AMRI Hospital, Kolkata. I have also enclosed two prescriptions of my wife with the letter addressed to the Manager, LICI I did not submit copy of prescriptions before Forum". From the above it is evident that the complainant himself after the death of his wife Ratna Das submitted these two prescriptions before the Manager, LICI (appellants) and the appellants herein being the respondents produced the said photo copy of two medical prescriptions dated 20.04.2010 and 23.04.2010 before the Ld. District Forum with a view to establish that the proposer Ratna Das was medically examined by the doctors of Apollo Gleneagles Hospital and AMRI Hospital, Kolkata and in course of examination the doctor noted the statement of Ratna Das in the said two medical prescriptions. So, there is no room to think that the photo copy of the two prescriptions produced as documentary evidence from the side of the insurance company before the ld. District Forum are manufactured or false documents created for the purpose of repudiating the claim of the complainant.
20. Furthermore, there is no scope to think that the doctor while examining a patient in course of check-up whimsically on his own noted in the prescription regarding the condition of the patient. The noting "diabetes" and also "Type 2 DM-1 year" as appearing in the presc4ription have been recorded on the basis of the statement of Deceased Life Assured "(DLA)" Ratna Das while she was examining by the doctors of AMRI Hospital and Apollo Gleneagles Hospital, Kolkata. This has clearly established that the DLA had been suffering from diabetes in Type 2 DM for about a year before the submission of the first proposal form for the first LIC policy out of two. It is unthinkable that a person who had been suffering from Type 2 DM was not aware regarding his or her suffering from diabetes and this presumption to the effect that at the material point of time the DLA had been suffering from diabetes has also been confirmed as appearing from the bed head ticket of the Tripura Hospital. So, there exists cogent reason to believe and hold that DLA Ratna Das had been suffering from diabetes in the category of Type 2 DM on and before the submission of the first proposal form on 27.01.2010 and also submission for second proposal form on 31.03.2010. From the decision of the Hon'ble national Commission cited hereinbefore has made it clear that the suffering of the DLA on or before the date of submission of proposal forms from diabetes and also status of her health is material fact and that material fact has been suppressed by the DLA in her two proposal forms submitted for two insurance policies. So, it is found that the DLA Ratha Das is guilty of suppression of material fact with a view to including and/or influencing the insurer i.e. insurance company fraudulently to accept the proposals and also to issue insurance policies in favour of the DLA.
21. On the basis of the provision of law embodied in section 45 of the Insurance Act and also on the basis of the principle of law enunciated in the decision of the Hon'ble Apex Court as well as Hon'ble National Commission, we are of the view that the material facts regarding answer to the Q. No.11 of the two proposal forms have been suppressed by the proposer Ratna Das while submitting the proposal forms. The proposer Ratna Das was a graduate and was also holding a responsible post in Tripura State Co-operative Bank Ltd. The DW 2 Latika Bhowmik, the agent of LICI in respect of proposal No. 22886 dated 31903.2010 deposed in complaint case no. C.C. 19/2013 and also Babul Shil, the agent of LICI of proposal No. 15421 dated 27.01.2010 examined as DW 2 in complaint case No.C.C.20/2013 have categorically stated in their respective cross-examination that the proposal form was filled up by her/him as per version of the insured. It also appears that barring merely a denial suggestion, nothing has been adduced to falsify this unrebutable evidence of the DW 2 in both the cases. Furthermore, the facts and circumstances also establishes that the DLA at the time of submission of proposal forms was well aware that she had been suffering from diabetes and she knew that her answer to the Q. No. 11 of the proposal forms was false and such answer was given by her intentionally with a view to inducing the insurance company to accept to the proposal and also to issue both the insurance policies in favour of her. On perusal of the judgments under appeals, it is our view that the Ld. District Forum considered diabetes in the category of Type 2 DM as nominal being a common disease.
22. On-going through the impugned judgments, it appears to us that it was the impression of the Ld. District Forum that as the insured Ratna Das did not die due to diabetes, but died due to septicemia, the non-disclosure of her suffering from diabetes in the proposal forms is not at all a vital factor. It further appears that the Ld. District Forum shifted the burden upon the insurance company for proving that the death of the insured Ratna Das was caused due to diabetes. In our view, the Ld. District Forum dealt with the said matter from a wrong approach as the Ld. District Forum failed to appreciate that the cause of death is not a vital factor for repudiating the claim of the claimant, rather the claim of the claimant has been repudiating on the ground of suppression of material facts concerning the answer to the Q. No. 11 of the two proposal forms whereby the proposer Ratna Das suppressed her suffering from diabetes and also falsely stated about status of her health with a view to inducing the appellant insurance company to accept the proposals.
23. It was argued by the learned advocate for the complaint and also as pleaded in both the complainants that the prosper was medically checked up by the doctors of the appellants before the issuance of the polices. On the other hand, it was specifically pleaded in the written objections by the present appellants that the proposals were accepted O.P.s based on the information, declaration and signature provided in the proposals by the proposer life assured. Not only so, the learned advance for the appellants submitted that both the insurance policies were non-medical cases where medical examination of the prosper before acceptance of the proposals is not compulsory and the insurance company accepted the proposal relying of the information, declaration or the proposer made in the proposals. From the discussions and findings made above, it is palpable that the proposer Ratna Das suppressed her disease 'diabetes' in the proposal forms. It has also been established that it is suppression of material facts which alone sufficient to repudiate the claim of the complainant. That being the position, we are of the view that the Ld. District Forum decided both the complaint cases from a wrong approach and as such the findings of the Ld. District Forum in both the impugned judgments are not based on sound reasonings and both the judgments have been passed without appreciating the provisions of laws and the principle of law enunciated by the Hon'ble National Commission and the Hon'ble Apex Court mentioned hereinbefore applicable in the facts and circumstances of the present appeals.
24. On the basis of our discussions made above, we are unable to accept the findings of the Ld. District Forum made in both the judgments which are found not legal and justifiable and as such the same are liable to be set aside and the complaint petition in both the complaint cases are also liable to be dismissed and the appeals should be allowed.
25. In the result, both the appeals are allowed. The impugned judgments dated 21.10.2013 passed in Case No.C.C.19/2013 and in case No.C.C.20/2013 by the Ld. District Forum, West Tripura, Agartala are hereby set aside. The complaint in C.C. 19/2013 and the complaint in C.C. 20/2013 are, accordingly, dismissed."
10. Hence, the present revision petitions.
11. We have heard learned counsel for both parties.
12. The learned counsel for the petitioner/complainant contended that the State Commission failed to consider the fact that the deceased Ratna Das died due to septicaemia and not Diabetes Mellitus(DM) Type 2 and these two diseases do not have any co-relation. Further, the State Commission relied upon medical documents dated subsequent to taking the insurance policy and the policy no. 15421 was submitted on 27.01.2010 and the prescription by Dr. Tirthankar Chaudhury, Apollo Gleneagles Hospital, Kolkata was dated 20.04.2010 which is subsequent to submitting the policy no. 15421. The petitioner and his deceased wife had information of the presence of DM Type 2 for the first time on 20.04.2010 through the said prescription. It is further contended that the prescription of Dr. Kasturi Bhaumik, AMRI Hospital, Kolkata was dated 23.04.2010, which is again subsequent to submitting the policy no.15421 and the State Commission had relied on that documents for giving its order and reversing the order of the District Forum. Further, the State Commission relied on the bed head ticket dated 04.11.2010 of the life assured deceased Smt. Ratna Das when she was admitted at Agartala, Tripura , which is again a medical record dated subsequent to taking the life insurance policy. Moreover, the State Commission failed to consider the fact that presence of DM Type 2 in a person's body is not known to him/her for considerable years and is an asmptomatic disease(meaning: a disease which does not show evidence) and thus presumption by the State Commission that the deceased life assured had knowledge of presence of DM Type 2 in her body or the knowledge of her husband--Petitioner herein is false and wrong in law. Lastly, the State Commission failed to consider the fact that DM Type 2 is a common disease in the people nowadays and presence of that is not known to the patient for a long time and that it is also a disease the level of which gets fluctuates at various time of the day and also on intake of foods.
13. Learned counsel for the Respondent/Opposite Party on the other hand stated that the order of the State Commission was correctly passed on the correct appreciation of facts and documents on record.
14. We have heard arguments and gone through the record.
15. As per photo copy of Prescription Slip of Dr. Tirthankar Chaudhury of Apollo Gleneagles Hospital, Kolkata dated 20.04.2010, the deceased-Mrs. Ratna Das, aged 45 years suffered from Diabetes Mellitus for the past one year. Further, another prescription slip of Dr. Kasturi Bhaumik of AMRI Hospital, Kolkata dated 23.04.2010 also establishes that the deceased Ratna Das was a diabetic patient. It is an admitted fact that the deceased Smt. Ratha Das had not mentioned this fact and suppressed the material facts about her health in so far that she had been suffering from " Diabetes" for last one year in the proposal forms for taking of both the insurance policies in question. However, we are of the view that respondents were justified in repudiating the claim and have not committed any deficiency in service in doing so.
16. Apex Court in Satwant Kaur Sandhu Vs. New India Assurance Co. Ltd, IV (2009) CPJ 8(SC), in Paras 12,13,17 and 18 has held;
"12.. .........Nonetheless, it is a contract of insurance falling in the category of contract 'uberrimae fidei', meaning, 'a contract of utmost good faith, on the part of the assured'. Thus, it needs little emphasis that when an information on a specific aspect is asked for in the proposal form, an assured is under a solemn obligation to make a true and full disclosure of the information on the subject which is within his knowledge.It is not for the proposer to determine whether the information sought for is material for the purpose of the policy or not.Of course, obligation to disclose extends only to facts which are known to the applicant and not to what he ought to have known. The obligation to disclose necessarily depends upon the knowledge one possesses. His opinion of the materiality of that knowledge is of no moment (See: Joel Vs. Law Union & Crown Ins.Co.[1908] 2 K.B. 863).
13. In United India Insurance Co. Ltd. Vs. M.K.J. Corporation, III (1996) CPJ 8 (SC) =(1996)6 SCC 428, this Court has observed that it is a fundamental principle of insurance law that utmost faith must be observed by the contracting parties. Good faith forbids either party from non-disclosure of the facts which the party privately knows, to draw the other into a bargain, from his ignorance of that fact and his believing the contrary.(Also see: Modern Insulators Ltd. Vs. Oriental Insurance Co. Ltd., II (2000)SLT 323 = I(2000) CPJ 1 (SC)=(2000)2 SCC 734).
17. The term "material fact" is not defined in the Act and, therefore, it has been understood and explained by the courts in general terms to mean as any fact which would influence the judgment of a prudent insurer in fixing the premium or determining whether he would like to accept the risk. Any fact which goes to the root of the Contract of Insurance and has a bearing on the risk involved would be "material".
18. As stated in Pollock and Mulla's Indian Contract and Specific Relief Acts, any fact the knowledge or ignorance of which would materially influence an insurer in making the contract or in estimating the degree and character of risks in fixing the rate of premium is a material fact".
17. The Hon'ble Supreme Court in Mrs. Rubi (Chandra) Dutta Vs. M/s United India Insurance Co. Ltd. 2011 (3) Scale 654 has observed;
"Also, it is to be noted that the revisional powers of the National Commission are derived from Section 21 (b) of the Act, under which the said power can be exercised only if there is some prima facie jurisdictional error appearing in the impugned order, and only then, may the same be set aside. In our considered opinion there was no jurisdictional error or miscarriage of justice, which could have warranted the National Commission to have taken a different view than what was taken by the two Forums. The decision of the National Commission rests not on the basis of some legal principle that was ignored by the Courts below, but on a different (and in our opinion, an erroneous) interpretation of the same set of facts. This is not the manner in which revisional powers should be invoked. In this view of the matter, we are of the considered opinion that the jurisdiction conferred on the National Commission under Section 21(b) of the Act has been transgressed. It was not a case where such a view could have been taken by setting aside the concurrent findings of two Fora".
18. Both the citations (supra) are applicable to the facts of the present case.
19. Thus, we find that no jurisdictional or legal error has been shown to us in the impugned order to call for interference in the exercise of powers under Section 21(b) of the Act. The order of the State Commission does not call for any interference nor does it suffer from any infirmity or erroneous exercise of jurisdiction or material irregularity. Thus, the present revision petitions are hereby, dismissed and the consumer complaints filed by the petitioner/complaint before the District Forum also stand dismissed.
......................J AJIT BHARIHOKE PRESIDING MEMBER ...................... REKHA GUPTA MEMBER