State Consumer Disputes Redressal Commission
Lic Of India vs Sabila Bano on 30 June, 2009
APPEAL NO: 48/2008 Life Insurance Corporation of India through Sr.Divisional Manager, Division office-Jeevan Prakash Ranadey Marg, Jaipur Through The Manager ( Legal) LIC of India,Divisional office Jeevan Prakash, Bhawani Singh Road, Jaipur. Opposite parties- appellants Vs. Smt.Sabila Bano r/o Village Somalpur Badiya Aam-ka-Bera, Post HMT Ajmer. Complainant-respondent Date of judgment 30.6.09 Before: Mr.Justice Sunil Kumar Garg-President Mrs.Vimla Sethia-Member Mr.Ramkalyan Sharma counsel for the appellants Mr.Paras Jain counsel for the respondent 2 JUDGMENT
BY THE STATE COMMISSION (PER HON. MR.JUSTICE SUNIL KUMAR GARG, PRESIDENT ) This appeal has been filed by the appellants LIC against order dated 13.11.07 passed by the District Forum, Ajmer in complaint no. 184/2007 by which the complaint of the complainant was allowed in the manner that the appellants were directed to pay a sum of Rs. 1 lac, the amount of the LIC policy alongwith interest @ 9% p.a. with effect from after two months from the date of filing of the insurance claim and further to pay a sum of Rs.1500/- as costs of litigation.
2. It arises in the following circumstances-
That the complainant respondent had filed a complaint before the District Forum, Ajmer on 25.5.07 inter alia stating that her husband Molana Javid, now deceased had taken a life insurance policy for a sum of Rs. 1 lac from the appellants bearing policy no. 185314100 on 15.7.05 and the policy was issued on 18.7.05 in favour of the deceased. It was further stated in the complaint that the deceased had died on 7.12.05 while he was being admitted in the JLN Hospital, Ajmer and after the death of the deceased claim was preferred by the complainant respondent being the wife and nominee of the deceased before the office of the appellants but that claim was repudiated by the appellants through letter dated 6.3.07 on the ground that before taking the policy in question the deceased had filled in up a declartion form regarding his health on 12.7.05 in which he had not mentioned that he 3 was suffering from any kind of disease but they had the sufficient proof to prove the fact that prior to one year before he proposed the above policy, the deceased was suffering from TB and he had taken the treatment of Anti Tuberculosis for the last one year and since these facts were not disclosed by the deceased in his declaration form on 12.7.05 at the time of taking the policy, therefore, the deceased was guilty of suppression of material facts regarding his health. Thereafter the present complaint was filed.
A reply was filed by the appellants on 3.8.07 and they have taken the same pleas which were taken by them in the repudiation letter dated 6.3.07. It was further stated in the reply that not only this that the deceased was a patient of TB prior to filling in up the declaration form regarding his health on 12.7.05 but he was also suffering from the disease of AIDS and since these facts were not disclosed by the deceased in his declaration form dated 12.7.05, therefore, it was a case of suppression of material facts regarding health on the part of the deceased and it was prayed that claim was rightly repudiated by the appellants and complaint be dismissed.
After hearing the parties the District Forum, Ajmer through impugned order dated 13.11.07 had allowed the complaint inter alia holding that -
(i) That so far as the issue of AIDS is concerned, no doubt the report Anx. R-3 pertaining to HIV test, was given on 10.12.05 but before that the deceased 4 had died on 7.12.05 and thus it was not material one.
(ii) That on point of TB it is held that as per the bed head ticket of the JLN Hospital, Ajmer the deceased was admitted in the hospital on 7.12.05 and had died on the same day and if it was mentioned in the bed head ticket that he was a patient of TB for the last one year, that would not be a sufficient proof to prove the fact that he was a patient of TB and thus it was not a case of suppression of material facts regarding health on the part of the deceased.
(iii) That the appellants were not justified in repudiating the claim of the complainant respondent and it had amounted to deficiency in service on the part of the appellants.
Aggrieved from that order dated 13.11.07 passed by the District Forum, Ajmer , this appeal has been filed by the appellants.
3. In this appeal the main contention of the learned counsel for the appellants is that before issuance of policy in question, the deceased was suffering from the disease of TB for which he had taken the treatment of Anti Tuberculosis for the last one year and he was also suffering from the disease of AIDS and since these facts were not disclosed by the deceased deliberately in his declaration form on 12.7.05 , therefore, he was guilty of suppression of material facts regarding health and thus on that ground the claim of the complainant respondent was rightly repudiated by the appellants through letter dated 6.3. 07 and the 5 District Forum had committed serious error and illegality in decreeing the claim of the complainant respondent. Hence the impugned order could not be sustained and liable to be quashed and set aside and this appeal deserves to be allowed.
4. On the other hand, the learned counsel appearing for the respondent has supported the impugned order of the District Forum .
5. We have heard the learned counsel for the appellants as well as for the respondent and gone through the entire materials available on record.
6. There is no dispute on the point that the deceased had taken a life insurance policy for a sum of Rs. 1 lac from the appellants bearing policy no. 185314100 on 15.7.05
7. There is also no dispute on the point that at the time of taking insurance policy , a declaration was made by the deceased and in that declaration on 12.7.05 , he had not mentioned that he was suffering from any kind of disease or had taken any treatment from any hospital.
8. There is also no dispute on the point that the deceased had died on 7.12.05 while he was being admitted in the JLN Hospital, Ajmer , meaning thereby within one year of issuance of the policy.
9. There is no dispute on the point that the claim of the above mentioned policy was repudiated by the appellants through letter dated 6.3.07 on the grounds mentioned therein.
610. There is no dispute on the point that the deceased was admitted for the first time in the JLN Hospital, Ajmer on 7.12.05 and the disease of TB was found and in the bed head ticket it was also mentioned that the deceased was taking Anti Tuberculosis treatment for the last one year.
11. There is also no dispute on the point that on 7.12.05 when the deceased was admitted in the JLN Hospital,Ajmer, a test for HIV was also conducted on the deceased and the report in positive was given on 10.12.05.
12. Thus, in the facts and circumstances just narrated above, the question for consideration is whether the findings recorded by the District Forum could be sustained or not and whether the repudiation of the claim of the complainant respondent by the appellants was justified or not.
On HIV/AIDS
13. "
HIV" Human Immunodeficiency Virus and " AIDS" Acquired Immune Deficiency Sundrome means an illness which is caused by infection with a retrovirus-HIV, transmitted in sexual fluids and blood ( often if not always fatal ) in which opportunistic infections or malignant tumors develop as a result of the severe loss of cellular immunity.
14. No doubt in the present case the deceased was admitted for the first time in JLN Hospital,Ajmer on 7.12.05 and after being examined, the report of HIV test was found positive and since the declaration form regarding health was filled in up by the deceased on 12.7.05, therefore, possibility could not be ruled out 7 that the deceased was not aware of the fact that he was suffering from the disease of AIDS and thus suppression of that disease would not amount to suppression of material facts regarding health on the part of the deceased.
On point of TB
15. In this case no doubt the declaration regarding health was given by the deceased on 12.7.05 and in the bed head ticket of the hospital, it was mentioned that the deceased was taking the Anti Tuberculosis treatment for the last one year. No doubt past history recorded in the bed head ticket could not be treated as primary evidence, but in some cases that could be treated as primary evidence and the present case is such a case where past history recorded in the bed head ticket should be treated as primary evidence for determining the facts regarding health of the deceased, especially looking to the facts that though declaration form was filled in up by the deceased on 12.7.05 and the policy in question was issued in his favour on 18.7.05 and the deceased had died on 7.12.05 within five months of the issuance of the policy in question.
16. It may be stated here that as per past history recorded in the bed head ticket, the deceased was suffering from TB and as per medical science, it could easily be said that a person, who is suffering from TB means that he was patient of that disease for the last atleast three years and such disease could not be develoved within few months and thus, it can reasonably be inferred or presumed or concluded that at the time of taking the policy in question, the deceased was aware of the fact that he was suffering from the disease of TB, but he deliberately and 8 intentionally did not disclose that fact in his declaration form dated 12.7.05 and thus he was guilty of suppression of material facts regarding health.
17. For the reasons stated above, it is held that repudiation of claim of complainant respondent by the appellants through letter dated 6.3.07 on ground of suppression of material facts regarding health by the deceased was justified and no illegality or irregularity has been committed by the appellants in repudiating the claim of complainant respondent and in view of this, the findings of the District Forum decreeing the claim of the complainant respondent could not be sustained and the same are liable to quashed and set aside as they are wholly illegal, erroneous and perverse one and the appeal deserves to be allowed.
18. During the course of arguments the learned counsel for the respondent has stated that in case the appeal of the appellants is going to be allowed, in such circumstances some amount of compensation as ex-gratia be allowed to the complainant respondent who is a widow and poor lady.
On ex-gratia payment
19. Ex-gratia payments are made as an act of grace, if the damage caused is outside the scope of the policy terms, or the liability under the policy is doubtful. In such cases the payment is made as an act of grace on humanitarian grounds. As a matter of fact, the loss or damage is outside the terms of the policy but the insurer takes a lenient view on humanitarian grounds. In such cases, full amount to indemnify the damages is not made. Such 9 payments do not place the insurer under an obligation to make such payments in similar circumstances in future.
20. Further ex-gratia payment of claim would arise where there was no legal liability on the Life Insurance Corporation to make payment as in the case of repudiated claim or unconcluded contract. Such claims are paid to mitigate hardship to the claimants by way of equitable relief. The analysis, particularly of a repudiated claim for consideration of an ex-gratia payment, would be a skilful exercise on the part of the concerned officers of the opponent Life Insurance Corporation of India. Ex-gratia payment cannot be claimed as a matter of right. For that the law laid down by the Hon'ble National Commission in the case of LIC Vs. Shashi Gupta ( 1994) 2 CPR 622 (NC) ) may be referred to.
21. Further the word 'ex-gratia' payment itself means a payment which is voluntarily and charitable in nature and since the C.P.Act,1986 is based on the principle of equity, therefore, hypertechnicalities could be ignored and equitable consideration should be kept in mind while deciding the matter.
22. However, looking to the entire facts and circumstances of the case and looking to the fact the LIC policy was for a sum of Rs.1 lac and on humanitarian consideration, this Commission thinks it just and proper to award ex-gratia amount of Rs.20,000/- in lumpsum to the complainant respondent.
23. It is further made clear that ex-gratia payment to the tune of Rs.20,000/- in lumpsum is being given to the complainant respondent who is a widow, not as a matter of right but taken into consideration the facts and circumstances that the condition 10 of a widow in India is not good and in the present case the complainant respondent is a widow lady.
24. In view of the discussions made above, this appeal filed by the appellants is allowed and the impugned order dated 13.11.07 passed by the District Forum, Ajmer is quashed and set aside and the complaint of the complainant respondent is dismissed. However, the appellants LIC would pay a sum of Rs.20,000/- in lumpsum as ex-gratia payment to the complainant respondent.It may further be stated here that while preferring this appeal the appellants had already deposited a sum of Rs.25,000/- with the District Forum Ajmer and the District Forum,Ajmer is directed to pay a sum of Rs. 20,000/- to the complainant respondent and the rest amount be returned to the appellants LIC.
Member President