State Consumer Disputes Redressal Commission
Sr. Divisional Manager Lic vs Sunita Devi on 17 December, 2007
BEFORE THE STATE CONSUMER DISPUTES REDRESSAL COMMISSION, BEFORE THE STATE CONSUMER DISPUTES REDRESSAL COMMISSION, RAJASTHAN JAIPUR 1. Appeal No.1305/2005 Senior Div.Manager,Life Insurance V/s Smt.Sunita Corporation of India Devi & ors. 2. Revision No.40/2005 Smt.Sunita Devi V/s Life Insurance Corporation of & ors. India 17.12.2007 Honble Mr.Justice Sunil Kumar Garg, President Shri T.P.Gupta,Member
Smt.Vimla Sethia, Member Mr.R.K.Soni for the appellants-LIC Mr.S.K.Tailor for the complainants.
Per Honble Mr.Justice Sunil Kumar Garg, President Both the aforesaid matters (appeal filed by the Insurance Company-opposite party as well as revision filed by the complainants) are being decided by this common judgment as in both of them common questions of law and facts are involved and they arise out of the order of the learned District Forum, Bikaner dated 30.6.2005 passed in complaint case no.241/04.
Appeal No.1305/2005
2. This appeal under section 15 of the Consumer Protection Act, 1986 (hereinafter referred to as the Act of 1986) has been filed by the appellant-Insurance Company (opposite party in the original complaint) against the order dated 30.6.2005 passed by the learned District Forum, Bikaner in complaint case no.241/04 by which the complaint filed by the complainants-respondents under section 12 of the Act of 1986 was allowed in the manner that the appellant was directed to pay to the complainant-respondent no.1 a sum of Rs.6 lacs as insurance claim amount under policy no.101297098 of deceased Sunil Kumar and Rs.500/- as mental agony and Rs.500/- as cost of litigation total Rs.1000/- within one month and in case the said amount was not paid within one month, the complainant respondent no.1 would be entitled to get interest @ 9% p.a. on the above insurance amount from the date of order till payment was made.
3. It may be stated here that the complainants-respondents had filed a complaint under section 12 of the Act of 1986 before the District Forum, Bikaner on 18.10.2004 stating inter-alia that on 28.12.2001, Sunil Kumar (hereinafter referred to as the deceased), husband of complainant-respondent no.1 and father of complainants-respondents nos.2 and 3 had taken insurance policy bearing no.101297098 for Rs.6 lacs from the appellant and that policy came into force with effect from 28.12.2001. It was further stated in the complaint that on 5.11.2002, the deceased felt pain in abdomen and for treatment, he was got admitted in P.B.M. Hospital, Bikaner, where during treatment, deceased had died on 17.12.2002. After the death of deceased, a claim was preferred by the complainants respondents before the appellant, but that claim was repudiated by the appellant through letter dated 31.3.2004 stating inter-alia that prior to filling in up the declaration form on 26.1.2002, the deceased was suffering from ulcer in intestine and cancer for which he had consulted a medical man and had taken treatment in the hospital, but these facts were suppressed by the deceased deliberately and intentionally and thus, deceased had made incorrect statements and withheld correct information regarding his health and on that ground of suppression of material facts regarding health, the claim of the complainants respondents was repudiated. Thereafter, the present complaint was filed.
4. A reply was filed by the appellants on 9.12.2004 in which they took the same plea which was taken by them in the repudiation letter dated 31.3.2004. It was further replied by the appellant that deceased was got admitted in the hospital on 5.11.2002 and as per past history recorded in bed head ticket, deceased was taking steroid locally for ulcerative colitis since nine months off and on and thus, since in the past history, it was found that deceased was suffering from the disease of ulcerative colitis for the last nine months, therefore, it was a case of suppression of material facts about health on the part of deceased and on that ground, claim of the complainants respondents was rightly repudiated by the appellants through letter dated 31.3.2004 and the present complaint deserves to be dismissed.
5. After hearing both the parties, the learned District Forum, Bikaner through impugned order dated 30.6.2005 allowed the complaint of the complainants-respondents in the manner as indicated above holding inter-alia:
(i) That no doubt deceased was got admitted in the hospital on 5.11.2002 complaining abdominal pain and during treatment, in the past history recorded in the bed head ticket, it was stated that the deceased was suffering from the ulcerative colitis for the last nine months, but since the policy in question was taken by the deceased on 28.12.2001 and the deceased was got admitted on 5.11.2002 on complaining abdominal pain meaning thereby the period of nine months started after taking the policy in question and thus, it cannot be said that at the time of taking policy in question, the deceased was aware of the fact that he was suffering from ulcerative colitis. Hence, it was not a case of suppression of material facts regarding health on the part of deceased.
(ii) That apart from this, the appellants have taken shelter of report of Dr.Kedar Nath Sharma, but his affidavit had not been produced.
(iii) That repudiation of claim of the complainants respondents was not justified and it amounted to deficiency in service on the part of the appellant.
6. Aggrieved from the said order dated 30.6.2005 passed by the learned District Forum, Bikaner, this appeal has been filed by the appellant.
7. In this appeal, the main contention of the learned counsel for the appellant is that the claim of the complainants respondents was rightly repudiated by the appellant on the ground of suppression of disease ulcerative colitis by the deceased as there is ample evidence on record to show that prior to filling in up the declaration form on 26.1.2002, the deceased was suffering from ulcerative colitis for which he had taken treatment from the hospital, but he had not disclosed these facts deliberately and intentionally while filling in up the declaration form on 26.1.2002 and thus, he was guilty of suppression of material facts. Therefore, the findings of the learned District Forum decreeing the claim are wholly erroneous, illegal and perverse one and hence, the same cannot be sustained and liable to be set aside.
8. On the other hand, the learned counsel appearing for the respondents-complainants has supported the findings of the learned District Forum.
9. We have heard the learned counsel appearing for the appellant and the learned counsel appearing for the respondents and gone through the entire materials available on record.
10. There is no dispute on the point that deceased had taken insurance policy from the appellant and that policy came into force with effect from 28.12.2001 and for that, he had filled in up declaration form on 26.1.2002 in which he had not mentioned that he was suffering from the disease of ulcerative colitis.
11. There is also no dispute on the point that the deceased was got admitted in P.B.M. Hospital, Bikaner on 5.11.2002 complaining abdominal pain where during treatment, he had died on 17.12.2002, meaning thereby within two years of issuance of policy.
12. There is also no dispute on the point that the claim of the complainants respondents was repudiated by the appellant through letter dated 31.3.2004 on the ground of suppression of disease ulcerative colitis.
13. There is also no dispute on the point that in the past history recorded in the bed head ticket of the hospital, it was mentioned that deceased was taking steroid locally for ulcerative colitis since nine months off and on.
However, there is no record on the file to show that before taking the policy on 28.12.2001, deceased had taken treatment of ulcerative colitis in any hospital or had consulted any medical man for treatment of that disease.
14. Thus, in the facts and circumstances just narrated above, the question for consideration is whether repudiation of claim of complainants-respondents by the appellant on ground of suppression of disease Ulcerative Colitis was justified or not or whether the findings of the learned District Forum decreeing the claim could be sustained or not.
15. Before proceeding further, it may be stated here that it is the fundamental principle of insurance law that utmost good faith must be observed by the contracting parties and good faith forbids either party from non-disclosure of the facts which the parties known. The insured has a duty to disclose and similarly it is the duty of the insurance company and its agents to disclose all material facts in their knowledge since obligation of good faith applies to both equally and in this respect, the decision of the Honble Supreme Court in M/s Modern Insulators Ltd. V/s Oriental Insurance Company (AIR 2000 SC 1014) may be referred to.
16. The onus probandi, in cases of fraudulent suppression of material facts rests heavily on party alleging fraud namely the insurer. Furthermore, mere concealment of some facts will not amount to concealment of material facts.
17. Suppression of fact must be a conscious operation of the giver of the answer which he knowingly did not disclose.
18. The Honble National Commission in National Insurance Co.Ltd. V/s Bipul Kunda (2005 CTJ 377 (CP) (NCDRC)) has held that for repudiating a claim of an insured, it is for the insurer to show that a statement on a fact, which was material for the policy, had been suppressed by the insured and that statement was fraudulently made by him/her with the knowledge of the falsity of that statement.
19. As already stated above, the death of the deceased had taken place within two years of the issuance of the policy.
20. It may be stated here that where the insurer wishes to call in question a policy within two years of its being effected, it is enough if the insurer is in a position to show that a statement made in the proposal for insurance or in any report of a medical officer or referee or friend of the insured or in any other document leading to the issue of the policy is inaccurate or false.
21. It may further be stated here that even if the death takes place within two years, mis-representation, if any, that should be material in the sense of having some effect upon life expectation whether direct or indirect and if it is found material, that defence could be taken by the Insurance Company, not otherwise.
22. In this case, no doubt as per bed head ticket of the hospital, deceased was admitted on 5.11.2002 and in the past history, it was written that deceased was taking steroid locally for ulcerative colitis since 9 months off & on, but there is nothing on record to show that before taking the policy in question on 28.12.2001, the deceased had taken treatment of ulcerative colitis in any hospital or had consulted any medical man for treatment of that disease.
23. In our considered opinion, since there is no documentary proof or evidence available on record to show that the deceased was ever admitted in any hospital for treatment of disease of ulcerative colitis prior to taking the policy on 28.12.2001, therefore, it cannot be said that the deceased was guilty of suppression of material facts about health. No doubt in the bed head ticket, on past history, it was mentioned that deceased was taking treatment of ulcerative colitis for the last nine months but to corroborate and prove that entry, no documentary proof or evidence or material has been produced by the appellant showing that the deceased had earlier taken treatment of ulcerative colitis in any hospital. The appellant had failed to produce any document or paper to show that deceased had taken treatment of ulcerative colitis prior to filling in up the declaration form on 26.1.2002 and therefore, it cannot be said that it was a case of suppression of material facts regarding health on the part of the deceased.
24. Apart from this, it may be stated here that the past history recorded in the bed head ticket of hospital could not be treated as primary piece of evidence to prove any fact until and unless the doctor who had recorded that history had been produced. In this case, the doctor who had recorded the previous/past history had not been produced and his affidavit has also not been produced and therefore, no reliance could be placed on past history recorded in bed head ticket.
25. Furthermore, even for the sake of argument that deceased was taking treatment of ulcerative colitis for the last nine months, that period of nine months started after taking the policy in question. From that point of view also, it cannot be said that the deceased was aware of the fact that he was suffering from the ulcerative colitis and he deliberately concealed these facts while taking the policy in question on 28.12.2001.
26. For the reasons stated above, the appellant was not justified in repudiating the claim of the complainants-respondents on the ground of suppression of material facts by deceased and the appellant has repudiated the claim of the complainants-respondents without any basis and on wrong assumption and in an arbitrary manner and the learned District Forum has rightly held so. The findings of the learned District Forum decreeing the claim are based on correct appreciation of entire materials and evidence available on record and they do not suffer from any basic infirmity or illegality or perversity and hence, no interference is called for with the same and this appeal deserves to be dismissed.
Accordingly, the appeal no.1305/06 filed by the appellant is dismissed.
Revision No.40/200527. This revision has been filed by the complainants for enhancement of compensation.
28. In this case, the learned District Forum has awarded interest @ 9% p.a. on the decreetal amount with effect from the date of order till payment was made and looking to the entire facts and circumstances of the case, ends of justice would be met if interest is awarded from the date of filing complaint i.e. 18.10.2004 instead of date of order and to that extent, this revision deserves to be partly allowed and the impugned order on point of date of awarding interest is liable to be modified.
Accordingly, the revision no.40/05 filed by the complainants is partly allowed in the manner that the complainants shall be entitled to get interest on the decreetal amount with effect from the date of filing complaint i.e. 18.10.2004 instead of date of order as ordered by the learned District Forum and to that extent, impugned order of the learned District Forum, Bikaner dated 30.6.2005 on point of date of awarding interest stands modified.
(Vimla Sethia) (T.P.Gupta) (Justice Sunil Kumar Garg) Member Member President