State Consumer Disputes Redressal Commission
Lic Of India & Anr. vs Poonam Sharma on 17 April, 2007
H H.P. STATE CONSUMER DISPUTES REDRESSAL COMMISSION, SHIMLA. Appeal No. 255/2005. Date of Decision 17.04.2007. ________________________________________________________________________ 1. LIC of India, through Divisional Manager, Divisional Office Kasumpti, Shimla-9, 2. Branch Manager, LIC of India Branch Office Dharamshala, Distt. Kangra, 3. Branch Manager, LIC of India Mandi, H.P. . Appellants. Versus 1. Poonam Sharma W/o late Sh. Om Parkash Sharma R/o H.No. 334/11, Tarna Hills, Mandi, Distt. Mandi, H.P. . Respondent. 2. Kalpana Gupta, LIC agent Code No. 2568145 C/o Branch Manager, LIC of India, Branch Office, Dharamshala District Kangra, H.P. Proforma Respondent. __________________________________________________________________ Honble Mr. Justice Arun Kumar Goel, President. Honble Mr. Narinder Singh Thakur, Member. Honble Mrs. Saroj Sharma, Member. Whether Approved for reporting? Yes. For the Appellants. Mr. Navlesh Verma, Advocate. For the Respondent. Mr. Dharamvir Sharma, Advocate. For Proforma respondent None. .... O R D E R:
Justice Arun Kumar Goel (Retd.) President, (Oral) We have heard learned counsel for the parties and with their assistance have examined the record of this case.
2. Admitted facts giving rise to this appeal are that, deceased Om Parkash had obtained an Insurance policy in the sum of Rs. 1 lac for himself and it commenced w.e.f. 28.2.2001. He died on 27.2.2004.
_______________________________________________________________ Whether Reporters of Local Papers may be allowed to see the Order? Yes.
: 2 :3. Respondent No.1 being the widow of the insured, preferred her claim with the appellants. Deceased had got insured through LIC agent, who has been impleaded as respondent No.2.
4. Main thrust of the submissions of Mr. Verma learned counsel for the appellants was that, accepting everything for the sake of argument against his client to be correct, still no relief should have been granted to the respondent. According to him, the contract of insurance being based on utmost good faith and bonafide on the doctrine of uberrima-fides and the deceased having intentionally, as well as purposefully misstated the facts in the proposal form which he knew to be false, resulted in making the policy of Insurance Annexure R-1 as void. In this behalf great emphasis was laid by Mr. Verma on the declaration furnished by the deceased under his signatures, as well as the certificate of the doctor in the proposal form. With a view to advance the case of his clients, Mr. Verma further referred to medical certificates provided to his client by the Block Development Officer, Dharampur (Mandi) with Annexure R2/A. These are photostat copies of the fitness certificates of the deceased after he had availed medical leave during three different occasions. We have been able to read two of these fitness certificates, one shows that he was suffering from UTI (Urinary Tract Infection), and the other is Rakatchap (eligible), i.e., blood pressure. Other document on which great emphasis was laid by Mr. Verma to demonstrate that the deceased had remained on medical leave during different periods, prior to the period of Insurance policy till his death. Thus according to him, these documents are enough to negative the claim of the respondent. By ignoring this material evidence of his client District Forum below fell into error, on this ground also this appeal needs to be allowed per him.
5. Alternatively and without in any manner conceding, Mr. Verma submitted that the complaint involved serious and disputed questions of law and fact which could only be adjudicated upon by a Civil Court and not in summary proceedings under the Consumer Protection Act, 1986, (hereinafter to referred as the Act), Mr. Verma in support of his submissions referred to numerous precedents.
6. On the other hand Mr. Dharamvir Sharma learned counsel appearing for respondent No.1 submitted that, impugned order calls for no interference in the : 3 : circumstances of the case and particularly keeping in view the evidence produced by his client. He pressed into service Section 45 of the Insurance Act, 1938 and urged that challenge, if any, based on misstatement had to be also established to have been fraudulently made, so as to challenge such misstatement within two years. According to him, none of the document, i.e., Annexures R2/A, R2 to R5, improves the case of the appellants. By referring to evidence on record, i.e., the documents relied upon by Mr. Verma, it was submitted by learned counsel for respondent No.1 that deceased had died as a result of jaundice. Therefore, unless some direct nexus was shown with his cause of death with diseases shown in the medical certificates Annexures R2 to R4, merely because deceased had undergone medical leave on different occasions or was not well does not make the policy either void and or unenforceable. Thus he prayed for dismissal of the appeal with compensatory costs.
7. Before dealing with the contentions urged on behalf the parties and the case law cited at the bar by Mr. Verma, with reference to the file of the District Forum below, we may observe that the appellants have failed to discharge the onus which was heavily upon them both in law, i.e., the provision of Section 45 of the Insurance Act, as well as on the facts of this case. We are further of the view in this behalf, and no hesitation in concluding that even if deceased had availed medical leave and was suffering from blood pressure and UTI, unless some direct nexus was shown between the cause of death and these two diseases, no benefit can be derived by the appellants merely on the ground that some facts were not correctly or untruly stated by the deceased in the proposal form i.e., Annexure C-2.
8. It hardly needs to be reiterated here that in order to sustain this plea is incumbent upon the appellants to have also established not only misstatement simplicitor, but at the same time it also needs to established that it was with fraudulent intent. Learned counsel stated that fraud is mixed question of law and fact. So far record of the District Forum below is concerned, we find no evidence of fraud as according to us fraud is pure and simple question of fact which has to be established by the party alleging it by placing adequate and acceptable evidence on record. Mere misstatement or withholding of certain fact does not make every contract like proposal Annexure C-2, to be fraudulent. Both, i.e., the intentional misstatement and fraud have to be simultaneously proved which is the requirement : 4 : of law, as well as mandate of Section 45 of the Insurance Act, 1938. And we have already concluded that appellants have miserably failed to discharge this onus.
9. Now we shall deal with the case law cited by Mr. Verma.
10. First decision relied by him is Mithoolal Nayak Vs. Life Insurance Corporation of India, AIR 1962 SC 814. This deals with Section 45 of the Insurance Act, 1938. From its perusal we find that it is a judgment on its own facts, therefore, principles laid down in it have no applicability to the facts of the present case. Next decision relied upon is in State of Maharashtra and another Vs. Madhukar Narayan Mardikar, (1991) 1 SCC 57. A reference to this judgment clearly indicates that after taking note of the contention based on Section 45 of the Insurance Act Honble Supreme Court while dismissing the suit on the basis of material on suit file produced by the LIC, came to the conclusion there being no evidence to show that the suppression of material facts regarding health being fraudulent, the appeal was dismissed.
11. In the case of Smt. Prema and others Vs. LIC of India, Legal Digest January 2007 page 10, Revision Petition No. 237 to 240 of 2000, National Commission observed that Insurance contracts are uberrima-fides and are founded upon utmost good faith. It was further observed that in the face of preponderance of evidence it is not possible to accept that evidence led by the complainant about his examination by medical practitioner at the time of taking out insurance policy will overwhelm evidence led by the LIC. In this background Revision Petition of the LIC was dismissed.
12. At this stage we may also notice that today, it has been stated at the bar by Mr. Verma that, deceased was medically examined by a duly qualified doctor before policy Annexure R-1 was issued. Medical report of this doctor has not been placed on record of the complaint before the District Forum below, why remains shrouded by mystery. In these circumstances, we are constrained to draw adverse inference against the appellants for withholding of this document because, in case it had been produced it would not have support of the case of the appellants.
13. Again reliance was placed by Mr. Verma on a decision of National Commission in LIC of India and others Vs. Roshan Lal Gupta, Legal Digest : 5 : April, 2006, 13, R.P. No. 982/2004.
While dismissing the complaint, on the ground of incorrect answers having been given relating to age and few other facts, the National Commission set aside the order of the foras below. Again this is a judgment on its own fact. Because in this case there were two proposal forms wherein different dates of birth had been given by the insured. In this background the claim was rejected. And not only the dates of birth, but age, educational qualification, as well as income of the insured were found to be different. In these circumstances, again this is a judgment of its own facts and therefore, does not improve the case of the appellants.
14. Two decisions of the Honble Supreme Court of India are also relied upon by Mr. Verma on the plea that, terms of contract of Insurance have to be strictly construed and nothing is to be read down. Again there is no dispute with this legal proposition. Reason being that parties are well aware when they entered into contract, and also as to what are the terms thereof. These decisions are United India Insurance Co. Ltd. Vs. Harchand Rai Chandan Lal IV (2004) CPJ 15 (SC), and Polymat India Pvt. Ltd & another Vs. National Insurance Co. Ltd. and others IV (2004) CPJ 49 (SC). Ordinarily correct facts are expected to be disclosed by an insured like deceased in the present case, but then in order to overcome its liability in terms of the Insurance policy Annexure R1, unless it was simultaneously proved by acceptable evidence that the mis-statement was intentional as well as fraudulent, mere mis-statement will not be a ground to allow this appeal. So far terms of policy are concerned, we are construing as they exist.
15. Reliance was also placed on the decision of National Commission in Life Insurance Corporation of India Vs. Smt. Minu Kalita, III (2002) CPJ 10 (NC). A perusal of this judgment shows that there was ample acceptable evidence on record to show that deceased was suffering from cancer when he obtained the policy and cause of his death was also cancer. It was in this background that suppression of this material fact was held to be providing incorrect statement of his health, as also regarding age and income was made a ground to allow the revision petition of the Insurance Company and dismissing the complaint of the respondent. Again when a reference is made to the complaint file there is no evidence of fraud produced by the appellants in the appeal before us. Therefore, again this is of no help of the appellants.
: 6 :16. We may highlight one factual aspect in respect of these judgments cited by Mr. Verma and referred to hereinabove of the Honble Supreme Court as well as Apex Consumer Fora, that in all these cases there was evidence including medical evidence to show that the deceased was well aware regarding ailment that he was suffering from diseases at the time of obtaining the policy which was the cause of his death, whereas in the present case before us, we may observe that at the risk of repetition the so called ailments from which the deceased was suffering, had no nexus nor any could be pointed out with reference to medical evidence with the cause of death due to which the deceased died.
17. Catching the last straw Mr. Verma referred to a decision of the Honble Supreme Court in Civil Appeal No. 5334/06, LIC and others Vs. Surinder Kumar and others, dated 1.12.2006, and urged that this case squarely covers the present case and is a good ground to allow the present appeal. In the circumstances of this case it was observed that District Forum was right in coming to the conclusion that this was not a matter for trial before the forum under the Consumer Protection Act, having regard to the nature of controversy, therefore parties were relegated to the regular proceedings and the decision of the Apex Consumer Court was set aside in Revision Petition No. 2148/2003, was set aside and two other connected cases. Again this decision is of no consequence in the facts of the appeal before us, as well as keeping in view the material produced in evidence and above all failure of the appellants to discharge the onus which was heavily upon them under Section 45 of the Insurance Act, 1938.
18. In every case parties are not to be referred to a Civil Court by holding that it involves disputed and serious questions of law and fact. According to us respondent No.1 is not in a position to say anything so far proposal form Annexure C-2 is concerned, because it was filled in by her late husband. So far Annexures R2A, R2 to R5 are concerned, as already observed there is no connection between the ailments referred to in these and the cause of death. Thus according to us, there is no disputed or serious question of fact involved in this case so as to direct the parties to the Civil Court. For taking this view we are placing reliance on the decision of 3 judge bench of the Apex Court in Dr. JJ Merchand and others, Vs. Shrinath Chaturvedi, AIR 2002 SC 2931.
: 7 :19. So question of interpretation of the policy is concerned, where two views of possible it hardly needs to be emphasized that one favourable to the Consumer is to be followed. If any authority is required on this point, reliance is being placed on a decision of the Honble Supreme Court in United India Insurance Co. Ltd. Vs. Pushpalaya Printers (2004) 3 SCC 694.
20. No other point is urged.
21. In view of the aforesaid discussion there is no merit in this appeal and it merits dismissal. Ordered accordingly. No costs. Before parting we must placed on record our appreciation for the assistance rendered by Mr. Verma in the decision of this case, irrespective of the fact that we have not agreed with him.
All interims orders passed from time to time in appeal shall stand vacated forthwith.
Office will make available a copy of this order to the parties free of costs as per rules.
Shimla.
17th April, 2007. (Justice Arun Kumar Goel) Retd.
President.
(Narinder Singh Thakur), Member.
(Saroj Sharma), Karan* Member.