State Consumer Disputes Redressal Commission
Nirmal Singh vs Aegon Lic Ltd on 5 March, 2020
FIRST ADDITIONAL BENCH
STATE CONSUMER DISPUTES REDRESSAL COMMISSION,
PUNJAB, CHANDIGARH.
Consumer Complaint No.547 of 2018
Date of Institution: 06.07.2018
Order reserved on: 17.02.2020
Date of Decision : 05.03.2020
Nirmal Singh S/o Karatar Singh R/o Village Chakwalia, Khemkaran,
Tehsil Patti, District Tarn Taran.
.....Complainant
Versus
AEGON Life Insurance Company Limited, (formerly AEGON
Religare Life Insurance Co. Ltd.) Building No.3, Third Floor, Unit
No.1, NESCO IT Park, Western Express Highway Goregaon (E)
Mumbai-400063, having its Branch Office at No.9 & 10, Third Floor,
Kunal Tower, 88 Mall Road Ludhiana-141001, through its Branch
Manager/Authorized Signatory.
.....Opposite Party
Complaint U/s 17 of the Consumer
Protection Act, 1986.
Quorum:-
Hon'ble Mr. Justice Paramjeet Singh Dhaliwal, President
Mr. Rajinder Kumar Goyal, Member.
Ms. Kiran Sibal, Member.
Present:-
For the complainant : Sh. Vivek Singla, Advocate For the opposite party : Sh. Nitin Thatai, Advocate .................................................................................. KIRAN SIBAL, MEMBER:-
The complainant has filed this complaint against the opposite party (in short, "OP") seeking following directions to it:
i) to pay an amount of Rs.20,00,000/- (sum assured) alongwith interest @18% per annum, in the interest of justice;Consumer Complaint No.547 of 2018 2
ii) to pay an amount of Rs.5,00,000/- for unfair trade practices and deficiency in service, in the interest of justice;
iii) to pay an amount of Rs.5,00,000/- for mental stress and agony;
iv) to pay a sum of Rs.50,000/- as litigation charges; and
v) to pay interest @18% on the above amounts.
Facts of the complaint
2. Brief facts, as set out in the complaint, are that Gurwinder Singh son of the complainant, had purchased policy no.15071440815 from OP at Amritsar Branch. The policy commenced w.e.f. 24.07.2015 and the basic sum assured was Rs.20,00,000/-. Gurwinder Singh was a hale and hearty man and had no history of any ailment. Unfortunately, his son died on 12.08.2015. The complainant, being nominee of the said policy, lodged a death claim with OP at its branch at Ludhiana, as Amritsar Branch was closed by OP-company. OP repudiated the death claim vide letter dated 09.03.2018 on account of the fact that at the time of seeking insurance, his son Gurwinder Singh had already expired and in fact as per the investigation of the company, his date of death was 12.07.2015. There was no logical basis of repudiating the claim of the complainant and the repudiation was absolutely arbitrary, false and frivolous in order to avoid it liability. The OP company relied on fake documents and wrongly repudiated the claim. He visited the authorized representative of branch office repeatedly, but they Consumer Complaint No.547 of 2018 3 refused to provide the details of the evidence and record on the basis of which OP found that his son had expired on 12.07.2015. He alleged deficiency in service and unfair trade practice on the part of OP. Hence the present complaint.
Defence of opposite party
3. Upon notice, OP appeared and filed written reply raising preliminary objections that the complaint is false, frivolous, vexatious and an abuse of process of this Forum and is liable to be dismissed. The life insurance policy is a contract between the policy holder and the insurer, and the parties to it are bound by its terms and conditions. In the instant case, policy holder misrepresented the information in the proposal form and has breached the fundamental terms and conditions of the subject policy and the complainant is not entitled to any of the claims as alleged. The subject policy has been fraudulently obtained in the name of the life assured, since the life assured had passed away prior to the date on which the proposal was submitted for the subject policy, and the complainant was well aware of such fact. This clearly amounts to an attempt to commit a fraud on the company and to gain unlawfully at the expense of the company. The provisions of the Contract Act, 1872 clearly stipulate that where any contract has been entered into on the basis of a fraud, then such contract is voidable at the option of the aggrieved party, hence OP was justified in repudiating the claim of the complainant. The present complaint is not maintainable, as the claim of the complainant is based on a policy which is void ab-initio, invalid Consumer Complaint No.547 of 2018 4 and unenforceable, due to suppression of material facts. The complainant does not fall under the definition of consumer as he is a nominee in the policy and he is not entitled to file the present complaint. The contract of insurance is based on utmost good faith, and life assured was under a solemn obligation to disclose all such material facts to the insurance company and due to mis-statement or suppression of material facts by life assured, any person cannot not claim any benefits under that policy. In the present case, the policy holder, in whose name the policy had been sourced had expired prior to the login of the proposal and the details in the proposal from had been filled in and submitted by some party, with a clear intention to defraud the company. The complainant has not approached the State Commission with clean hands. The OP company under Section 45 of the Insurance Act, 1938 is well within its rights to repudiate the claim of the policy in the question, where such policy has been availed by an act of fraud. The OP further averred that subject policy was proposed in the name of Gurwinder Singh and the duly filled up and signed application form was submitted in the name of the deceased life assured, bearing application no.960176 dated 20.07.2015 for insurance on his life. The sum assured of the policy was Rs.20,00,000/- and for 15 years terms with annual premium of Rs.5312/-. The date of proposal was 20.07.2015 and date of issuance of policy was 24.07.2015. The OP received the death claim intimation dated 18.01.2018 from the complainant intimating that the deceased life assure had died on 12.08.2015 approximately within Consumer Complaint No.547 of 2018 5 30 days from the date of issuance of policy in question. The death claim was lodged by the nominee with OP after a gap of about two and half years, without explaining any reasons for such an inordinate delay, which reflects that the death claim is an afterthought in order to unduly harass the OP and make unlawful gains. The OP initiated the process of claim investigation in order to verify the authenticity of the said claim. Upon investigation, it was revealed that the deceased life assured (in short "DLA") actually died on 12.07.2015 i.e. approximately a week prior to the issuance of policy, but at the time of filling the death claim intimation form, nominee mention that the DLA expired on 12.08.2015, which was refuted by the documentary evidence (during investigation) produced by the OP. The investigating agency revealed that documents submitted by nominee were faulty and fraudulent, because as per certificate by Village Sarpanch DLA Gurwinder Singh died on 12.07.2015 and he was cremated in the cremation ground of the village in the presence of the villagers. That a medical certificate issued by Khahra Hospital dated 30.01.2018, the DLA was brought to the hospital on 12.07.2015 for treatment and the DLA died during the course of treatment. The DLA was a chronic alcoholic and was used to consuming drugs on daily basis and was depended on his family for his living. The claim of the complainant was repudiated vide letter dated 09.03.2018. The complainant requested for a reconsideration of his claim to which the company replied, vide letter dated 11.04.2018 stating that the reconsideration of the claim is under Consumer Complaint No.547 of 2018 6 process and would be replied. The complainant went ahead and sent a legal notice dated 07.05.2018. The complainant has not suffered any mental and physical harassment. In para wise reply, OP denied the other averments and allegations of complainant and prayed for dismissal of the complaint by denying any deficiency in service and unfair practice on its part.
Evidence of the parties
4. The complainant placed on record his affidavit alongwith documents Ex.C-1, Ex.C-2 (colly) copy of death certificate, Ex.C-3 death claim, Ex.C-4 copy of repudiation, Ex.C-5 legal notice and in additional evidence complainant tendered in evidence affidavit of Dr. P.S. Khahra alongwith his identity proof Ex.C-6(colly), affidavit of Anokh Singh (Ex-Sarpanch) alongwith his identity proof Ex.C-7 and C-8.
5. On the other hand, documents Annexure-A proposal form, Annexure-B terms and conditions of the policy, Annexure-C the copy of death claim form (colly), Annexure-D (colly) certificate given by Dr. P.S. Khahra dated 30.01.2018 and certificate given by Sarpanch of the Gram Panchayat Chakwalia, Annexure-E (colly) repudiation letter, Annexure-F (colly) reconsideration letters and affidavit of Ashish Ovalekar, Assistant Vice President-Legal. Contentions of the Parties
6. We have heard learned counsel for the parties and have carefully gone through the record of the case.
Consumer Complaint No.547 of 2018 7
7. Learned counsel for the complainant contended that Gurwinder Singh, son of complainant had purchased the said policy from OP at Amritsar Branch and he was a hale and hearty man and had no history of any ailment. Unfortunately, he died on 12.08.2015. The complainant lodged the death claim with OP at its branch at Ludhiana, as Amritsar Branch was closed by OP-company. He further argued that OP repudiated the death claim vide letter dated 09.03.2018 arbitrarily while relying upon fake documents i.e. certificate of Dr. P.S. Khahra and Sarpanch of the Village Chakwalia on account of the fact that at the time of seeking insurance, his son Gurwinder Singh had already expired on 12.07.2015. The repudiation was absolutely arbitrary, false and frivolous in order to avoid its liability. He contended that there is deficiency in service and unfair trade practice on the part of OP. Averring on the similar lines, as pleaded in the complaint, counsel for complainant prayed for acceptance of the complaint.
8. Learned counsel OP argued to the contrary that the policy was obtained by complainant fraudulently in the name of the life assured, since the life assured had passed away prior to the date on which the proposal was submitted for the policy, and the complainant was well aware of such fact. The complainant purchased the said in the name of the policy holder, whose had already been expired prior to the login of the proposal form. The complainant submitted the death claim on 18.01.2018 after a gap of about two and half years, without explaining any reasons for such an Consumer Complaint No.547 of 2018 8 inordinate delay. OP got investigated the matter and it was revealed that DLA actually died on 12.07.2015 i.e. approximately within a week prior to the issuance of policy, but at the time of filling the death claim intimation form, the nominee mentioned that the DLA expired on 12.08.2015. As per certificate of Village Sarpanch, DLA Gurwinder Singh died on 12.07.2015 and he was cremated in the cremation ground of the village in the presence of the villagers. As per medical certificate issued by Khahra Hospital dated 30.01.2018, the DLA was brought to the hospital on 12.07.2015 for treatment and the DLA died during the course of treatment. He further argued that the DLA was a chronic alcoholic and was used to consuming drugs on daily basis and was depended on his family for his living. On the basis of investigation the claim was rightly repudiated by OP. Averring on the similar lines as in the written reply, counsel for prayed for dismissal of the complaint.
Consideration of Contentions
9. We have heard the learned counsel for the parties and have also gone through the record of the case carefully.
10. The fact of issuance of Aegon Religare Term Insurance under policy no.15071440815 to Gurwinder Singh with date of commencement i.e. 24.07.2015 in not in dispute. The main grievance of complainant is that the insurance company has illegally repudiated the genuine claim of the complainant by raising controversy regarding the date of death of the DLA. The OP has Consumer Complaint No.547 of 2018 9 rebutted the allegations made in the complaint and has justified the repudiation.
11. The first objection of OP is that policy holder had already expired and complainant took the policy in the name of his dead son Gurwinder Singh by committing fraud on the OP. The OP relied upon Annexure-D (colly) certificate given by Dr. P.S. Khahra dated 30.01.2018 and certificate given by Sarpanch of the Gram Panchayat Chakwalia to the effect that DLA expired on 12.07.2015. From perusal of record, we find that OP has not placed on record the affidavit of Dr. P.S. Khahra and the said Sarpanch in support of these documents. Whereas, the complainant has placed on record the copy of death certificate of DLA Gurwinder Singh Ex.C-2 issued by Additional District Registrar, Birth & Death, Tarn Taran. This certificate proves that Gurwinder Singh DLA died on 12.08.2015. He also tendered in additional evidence, the affidavit of said Dr. P.S. Khahra Ex.C-6 and this witness deposed that certificate dated 31.01.2018 Annexure-D has not been issued by him, as per the record of the hospital and he also produced on record the copy of register of out-door patients dated 12.07.2015. The complainant has also produced on record the affidavit of said Sarpanch Anokh Singh (Ex-Sarpanch) Gram Panchayat, Chakwalia Ex.C-7. This witness has deposed in his affidavit that after the death of son of Nirmal Singh, few persons from insurance company had come to him asking that his signatures are required for processing the claim. At that time, he was the Sarpanch of the Panchayat and signed the Consumer Complaint No.547 of 2018 10 document. In his affidavit, he further deposed that in the document Annexure-D, incorrect date of death is mentioned, whereas Gurwinder Singh, son of Nirmal Singh died on 12.08.2015 and not on 12.07.2015. He had signed that document blindly without realizing that the insurance company was trying to create false documents for rejecting the claim of Nirmal Singh. These two affidavits of witnesses Dr. P.S. Khahra and Sarpanch Anokh Singh Ex.C-6 and C-7 are sufficient to prove that DLA Gurwinder Singh died on 12.08.2015. The OP failed to prove it on record that Gurwinder Singh died on 12.07.2015, instead of 12.08.2015. In the circumstances of the case, we are of the view that OP tried its best to repudiate the claim of the complainant by relying upon fake certificate of Dr. P.S. Khehra Annexure-D and also failed to rebut the evidence of complainant. The death certificate Ex.C-2 has been issued by public authority and is admissible in evidence. Where documentary evidence is available, oral evidence is to be excluded. The complainant had moved an application for production of original documents, but OP did not produce the same. So, adverse inference is to be drawn against OP. The complainant has not played any fraud upon OP and he submitted the genuine claim with OP. The OP wrongly repudiated the claim of the complainant without any basis by relying upon fake documents, it is clearly a deficiency in service and unfair trade practice on the part of OP.
12. The next objection strongly raised by counsel for OP is that complainant submitted the death claim after delay of two and Consumer Complaint No.547 of 2018 11 half year from the date of death of DLA without giving any explanation. We have gone through the record carefully and find one document at page no.88 of the file, placed on record by OP itself with Annexure-C (colly), wherein complainant stated that the delay in claim submission was due to the fact that he was finding the branch of OP nearby Amritsar and then he came to know about the Ludhiana Branch where he submitted the documents. From perusal of it, it is presumed that at the time of submission of death claim, OP had asked complainant about the delay and he submitted the explanation Annexure-C. Moreover, the complainant specifically pleaded in para no.1 of the complaint that DLA purchased the policy from OP at Amritsar Branch. In para no.5, he pleaded that Amritsar branch office was closed, as such he submitted the death claim form at Ludhiana Branch. In its written reply, OP has not denied these pleadings of the complainant. The OP has also not pleaded that, at that time its branch office at Amritsar was in operation. As per above discussion, we find no force in this contention of OP and the same is hereby rejected.
13. Learned counsel for OP raised objection that DLA was a chronic alcoholic and was used to consuming drug on daily basis and was depended on his family for his living. We find no force in this objection of OP, as there is no cogent evidence produced on record by it with regard to chronic alcoholism of complainant, as such we reject this objection of OP.
Consumer Complaint No.547 of 2018 12
14. The OPs have further pleaded that DLA had misstated the facts in the proposal form about his income and profession. From perusal of record, we find no document, which has been placed on record by OP to establish the criteria for less income and profession of DLA. The OP itself placed on record, one certificate of Anokh Singh, Sarpanch of said village, which is at page no.92 of the file to the effect that DLA was doing the work of Raj Mistry. Said Sarpanch in his affidavit Ex.C-7 denied the date of death only and not the profession of DLA. In the absence any such document with regard to less income and other profession of complainant, as adverse inference cannot be drawn against the DLA. As such, this objection of OP is also not tenable and we reject the same.
15. Learned counsel for OP relied upon judgments of Hon'ble National Commission titled as "Jai Singh Vs. LIC of India"
2008(2)CLT-94 and "Dr.(Mrs.) P. Marwaha & others Vs. New India Assurance Co. Ltd." 2005(4)CPJ-162. These authorities are not applicable to the facts and situation of the present case, as we have already discussed above that complainant has not committed any fraud on OP and DLA had not misstated the facts in the proposal form. Moreover, the OP placed on record fake certificate of Dr. P.S. Khahra, which was denied by the said doctor in his affidavit Ex.C-6 and this witness deposed that certificate dated 31.01.2018 Annexure-D has not been issued by him, as per the record of the hospital and he also produced on record the copy of register of out- door patients dated 12.07.2015. Moreover, the investigation agency Consumer Complaint No.547 of 2018 13 appointed by OP has not investigated the matter in accordance with the guidelines of IRDA, as it is proved on record vide affidavit of Anokh Singh (Ex-sarpanch), who deposed in his affidavit Ex.C-7 that he did not completely check as to what was written in the said certificate and by blindly accepting the words of insurance company regarding facilitation of the claim of Nirmal Singh, he signed the said documents without realizing that the insurance company was trying to create false documents for rejecting the claim of Nirmal Singh. OP completely failed to rebut these two affidavits, as discussed above. The OP was very well aware that doctor's certificate Annexure-D was fake and certificate given by said Sarpanch was not correct with regard to date of death, but despite that OP placed these documents on record without any hesitation to mislead this Commission as well to repudiate the genuine claim of complainant. This type of unfair trade practice is not appreciable and acceptable. We hold that OP repudiated the claim of the complainant arbitrary and the complainant is entitled to the sum assured amount alongwith compensation and litigation expenses, being the nominee in the said policy.
16. Sequel to our above discussion, we accept the complaint of the complainant and following directions are issued against OP:
(i) to pay the sum assured amount of Rs.20,00,000/- to complainant alongwith compensation, for deficiency in service and unfair trade practice of OP, in the shape of Consumer Complaint No.547 of 2018 14 interest @12% per annum from the date of repudiation i.e. 09.03.2018 till the actual payment; and
(ii) to pay Rs.50,000/- as composite compensation for mental agony and harassment and towards litigation expenses.
The compliance of this order shall be made by the OP within a period of 45 days of the receipt of certified copy of the order.
17. The complaint could be decided within prescribed period due to heavy pendency of work and less staff.
(JUSTICE PARAMJEET SINGH DHALIWAL) PRESIDENT (RAJINDER KUMAR GOYAL) MEMBER (KIRAN SIBAL) MEMBER March 05, 2020.
(MM)