Calcutta High Court
Gurupada Mahato vs The National Insurance Co. Ltd. & Ors on 5 December, 2008
Author: Indira Banerjee
Bench: Indira Banerjee
Order Sheet Serial No........
W.P. 905 of 2006
IN THE HIGH COURT AT CALCUTTA
CONSTITUTIONAL WRIT JURISDICTION
ORIGINAL SIDE
In the matter of :
GURUPADA MAHATO
Vs
THE NATIONAL INSURANCE CO. LTD. & ORS.
Before:
The Hon'ble Justice
INDIRA BANERJEE
Date: 05.12.2008
JUDGMENT
In this writ application, the petitioner has inter alia challenged a communication dated 5 th June, 2006 of the Senior Divisional Manager of National Insurance Co. Ltd. being the respondent No.1, rejecting the claim of the petitioner under a Group Personal Accident Policy No.100300/42/04/8200012 commencing from 1 st October, 2004 till the mid-night of 30 th September, 2005.
Ranglal Mahato, since deceased, father of the petitioner, became a member of the Group Personal Accident Policy, in terms of an agreement with Golden Trust Financial Services of Ranchi.
On 1 st June, 2005, the petitioner's father met with an accident and was admitted to the Deben Mahato Hospital. Two days later, on 3rd June, 2005, the petitioner's father died. On 24 th June, 2005, the petitioner informed the Golden Multi Services Club Ltd., of which the said Golden Trust Financial Services is a unit, of the death of his father Ranglal Mahato.
By a letter dated 25 th August, 2005, Golden Multi Services Club Ltd. informed the petitioner that the claim documents had not been received till then and further requested the petitioner to submit the same within 90 days from the date of the accident. The petitioner claims to have submitted the claim documents, immediately on receipt of the said letter.
On 23rd September, 2005, the Golden Multi Services Club Ltd. forwarded the claim documents to the National Insurance Co. Ltd. After almost a year, the respondent rejected the claim of the petitioner by its impugned letter, on the ground that the petitioner had submitted its claim after expiry of 90 days from the date of the accident.
The insurance cover note inter alia contained the following provision with regard to the notice of claim:
"Claim intimation should be given within 30 days by claimant/GMSC Ltd. to NIC Ltd. In regard to claim services, claim form along with necessary supporting documents should be submitted within 90 days from the happening of the accident. Any claims submitted after 90 days shall not be entertained. Death certificate, First Information Report to police, Final Investigation Report of Police, Post-mortem Report and Doctor's certificate to be sent along with the claim from in case of death........"
In the writ application it is claimed that the petitioner submitted all the documents to Golden Multi Services Club Ltd. within 90 days. If there was any delay on the part of Golden Multi Services Club Ltd., the petitioner was not to suffer.
Mr. Bhattacharya appearing on behalf of the petitioner relied on the following judgments:
1. Bimal Chandra vs. New India Assurance Co. Ltd. reported in 2005 (3) CHN 154.
2. National Insurance Co. Ltd. vs. Ishar Das Madan Lal reported in (2007) 4 SCC 105.
3. United India Insurance Co. Ltd. vs. Great Eastern Shipping Co. Ltd.
reported in (2007) 7 SCC 101.
4. ABL International Ltd. vs. Export Credit Guarantee Corporation 06 India Ltd. reported in (2004) 3 SCC 553.
In Bimal Chandra vs. New India Assurance Co. Ltd. (supra) a Single Bench of this Court considered the trauma caused to parents by reason of the accidental death of a son and held that the delay in filing the insurance claim could not be valid ground for refusing and/or denying the claim of the petitioners.
In National Insurance Co. Ltd. vs. Ishar Das Madan Lal (supra) the question was whether the exclusion clause in the policy was applicable in the facts and circumstances of that case. The Court held that the insurance policy covered the risk of theft. The judgment has no application in the facts of this case.
In United India Insurance Co. Ltd. vs. Great Eastern Shipping Co. Ltd. (supra) the Supreme Court was considering whether risk arising from storage during transit was covered. The judgment has no application in this case.
In ABL International Ltd. & Anr. vs. Export Credit Guarantee Corporation India Ltd. & Ors., the issue was whether on construction of the insurance contract in question, risk arising out of payment of consideration by a particular mode was covered. The Supreme Court held that the Courts could very well decide disputed questions of interpretation of the terms of a contract, raised in a writ petition. The Supreme Court held that a writ petition involving consequential monetary relief was maintainable.
Opposing the application, Mr. Sanyal appearing on behalf of the respondents relied on the following judgments:
1. General Assurance Society Ltd. vs. Chandmull Jain & Anr. reported in 1966 SC 1644.
2. Oriental Insurance Co. Ltd. vs. Samayanallur Primary Agricultural Co-operative Bank reported in (1999) 8 SCC 543.
3. United India Insurance Co. Ltd. vs. Harchand Rai Chandan Lal reported in (2004) 8 SCC 644.
4. Polymat India (p) Ltd. & Anr. vs. National Insurance Co. Ltd. & Ors. reported in (2005) 9 SCC 174.
5. L.I.C. India vs. S. Sindhu reported in (2006) 5 SCC 258.
In General Assurance Society Ltd. vs. Chandmull Jain & Anr. (supra) the Supreme court held that in interpreting documents relating to a contract of insurance, the duty of the Court was to interpret the words in which the contract was expressed by the parties, because it was not for the Court to make a new contract for the parties, however reasonable the same might be. There can be no dispute with the aforesaid proposition of law.
A judgment is a precedent for what it decides. The Supreme Court was not considering the delay in filing a claim, but the reasonableness of a condition in the policy, giving mutual rights to the parties to cancel the insurance at any time.
In Oriental Insurance Co. Ltd. vs. Samayanallur Primary Agricultural Co-operative Bank (supra), the Supreme Court rightly held that no artificial meaning could be given to the words appearing in the insurance policy.
In the aforesaid case too, the Supreme Court was considering whether the contents of the cash box were covered. The Supreme Court found that the jewellery in the cash box was not jewellery in the safe and, therefore, not covered.
In United India Insurance Co. Ltd. vs. Harchand Rai Chandan Lal reported in (2004) 8 SCC 644 the Supreme Court held that it was settled law that the terms of the contract had to be strictly read and given natural meaning. No outside aid should be sought unless the meaning was ambiguous. In the aforesaid case, the Supreme Court was considering whether there had been burglary as defined in the insurance contract.
In Polymat India (p) Ltd. & Anr. vs. National Insurance Co. Ltd. & Ors. (supra) the Supreme Court held that it was the duty of the Court to interpret a contract strictly, as the same was understood between the parties, without altering the nature of the contract.
In L.I.C. India vs. S. Sindhu (supra) the Supreme Court reiterated that Courts could not rewrite a contract of insurance and could not direct the insurer to pay interest contrary to the terms and conditions of the contract.
None of the judgments cited by Mr. Sanyal referred to above, are an authority for the proposition that an insurance claim is not at all entertainable if the notice of claim is submitted beyond the time stipulated in the agreement.
There can be no doubt that the Court cannot rewrite the contract of insurance. Nor can the Court add to or modify the terms and conditions of a contract of insurance. The terms and conditions of a contract of insurance are, however, open to interpretation.
The Court can, however, definitely decide whether any time stipulation in the contract is of essence to the contract. In interpreting the provisions of a contract, the contract is to be read as a whole. Headings, sub-headings and/or marginal notes cannot be overlooked. A particular provision of the contract cannot be read in isolation.
A perusal of the insurance cover note as annexed to the writ petition, shows that the provisions are categorized under different headings. The clauses and/or paragraphs under the heading, 'conditions' do not contain any time stipulation for submission of a claim. 'Notice of claim' has been separately categorized. The insurance company has thus not treated the time stipulation for submission of notice of claim as an essential condition of the contract of insurance.
In any case, the word 'shall' is not always mandatory. The word 'shall' may, having regard to the context, be construed as directory. The word 'shall', having regard to the nature of the policy, in this case, could be construed to mean 'may', at least in case of death, where the notice of claim is not filed by the policy holder but his heirs and/or legal representatives.
Moreover a standard contract in which one of the parties is 'State' within the meaning of Article 12 of the Constitution should not be interpreted in a manner that renders the contract unconscionable or arbitrary.
The time stipulation for submission of claim is possibly intended to enable the insurance company to verify the claim. The magnitude of loss or injury by reason of an accident, may be difficult to assess and/or verify, after lapse of time. However, where life is insured and there is clear evidence of death on account of accident of a person covered by the insurance, the legitimate claim of the heirs cannot, in my view, be defeated on the sole ground of delay in submission of claim. In this case the death by accident is not disputed.
It is doubtful whether the time stipulation for submission of a claim in the standard form, contract of insurance of a national insurer/government company, that is, State within the meaning of Article 12, can be enforced against the heirs and legal representatives of a deceased policy holder. Legal representatives and heirs may not even be aware of the insurance policy until a search is made of documents after the shock and trauma of the sudden death by accident of a near and dear one has waned with passage of time. Denial of a claim of an heir in case of admitted accidental death, merely on the ground of delay in submission of the claim might render the time stipulation void, the same being an unconscionable deal between parties of unequal bargaining power.
Disputed facts as to whether the petitioner had knowledge of the insurance policy or whether the claim papers were submitted to Golden Multi Services Club Ltd. within or after thirty days, are of course not adjudicated in writ proceedings.
Mr. Sanyal has however, drawn my attention to an unreported judgment of the Division Bench comprising Their Lordships, the Hon'ble the Chief Justice and Hon'ble Mr. Justice Sanjib Banerjee whereby Their Lordships upholding the order of the learned Single Judge dismissing a writ application in which the issues involved were identical.
The Division Bench gave liberty to the claimant to approach the consumer forum, inter alia holding that the genuineness of a claim could not be ascertained by the Court.
In giving liberty to the claimant to approach the consumer forum, the Division Bench by necessary implication did not accept the contention that a claim can never be entertained after expiry of the stipulated time for submission of claim papers. Had the Division Bench taken a contrary view, there could be no question of any direction relegating the parties to their remedy before the appropriate consumer court. The issue has been kept open.
This writ application is disposed of by giving liberty to the petitioners to approach the appropriate Consumer Court for relief, in terms of the judgment of the Division Bench referred to above.
(Indira Banerjee, J.) (sent to server on 25.03.09)