State Consumer Disputes Redressal Commission
Senior Manager vs Ku. Manju Bhattacharya on 7 February, 2014
CHHATTISGARH STATE
CONSUMER DISPUTES REDRESSAL COMMISSION,
PANDRI, RAIPUR (C.G.)
Appeal No.FA/13/88
Instituted on : 24.01.2013
Senior Manager,
Life Insurance Corporation of India,
Divisional Office, Bilaspur (C.G.) ... Appellant.
Vs.
Ku. Manju Bhattacharya, D/o Late Pushpa Bhattacharya,
Through : Narayan Acharji, M.I.G.- A/6,
Behind Government Poultry Farm, Choti Koni,
Bilaspur, Tehsil & Dist. Bilaspur (C.G.) ... Respondent.
PRESENT: -
HON'BLE SHRI JUSTICE R.S. SHARMA, PRESIDENT
HON'BLE MS. HEENA THAKKAR, MEMBER
COUNSEL FOR THE PARTIES: -
Shri D. Dutta, Advocate for appellant.
Shri Bharat Jaiswal, Advocate for respondent.
ORDER
Dated : 07/02/2014 PER :- HON'BLE SHRI JUSTICE R.S. SHARMA, PRESIDENT. This appeal is directed against the order dated 19.12.2012, passed by the District Consumer Disputes Redressal Forum, Bilaspur (C.G.) (henceforth "District Forum"), in Complaint Case No.192/2011. By the impugned order, the learned District Forum, has allowed the complaint of the respondent / complainant and directed the appellant/O.P./Insurance Corporation to pay a sum of Rs.1,00,000/- with bonus to the respondent/complainant within a period of two months, otherwise the aforesaid amount would be payable along with // 2 // interest @ 7% p.a. The District Forum has further directed the appellant/O.P./Insurance Corporation to pay a sum of Rs.1,000/- as cost of litigation.
2. The facts of the complaint case filed before the District Forum are : that Late Smt. Pushpa Bhattacharya, who was mother of the respondent/complainant, had obtained an insurance policy from the appellant/O.P./Insurance Corporation for the value of Rs.1,00,000/-. The insurance policy No. is 38422641. At the time of making proposal for the insurance policy, the insured mentioned in the proposal form that she was fully healthy and the appellant/O.P./Insurance Corporation accepted the proposal of the deceased after obtaining report from their authorized doctor in respect of health of the policy holder. During the subsistence of the insurance, on 16.10.2009 the insured Smt. Pushpa Bhattacharya died due to lungs disease and her death was natural. The respondent/complainant submitted claim form for obtaining the benefits under the insurance policy before the appellant/O.P./Insurance Corporation after completing all formalities and necessities, but the appellant/O.P./Insurance Corporation without proper and sufficient reason refused to pay the claim amount to the respondent/complainant vide letter dated 23.12.2010 on the ground that the insured suppressed material facts regarding her health at the time of making proposal for the insurance. The deceased insured suffered // 3 // heart disease and was also suffering from diabetes since last 14 years. The deceased insured suppressed above material facts in her proposal for the insurance. Thus, the appellant/O.P./Insurance Corporation, has rightly repudiated the claim of the respondent/complainant and has not committed any deficiency in service. The respondent/complainant tried her level best for redressal of her grievances orally & in writing, but could not get any benefit. On account of deficiency in services committed by the appellant/O.P./Insurance Corporation, the respondent/complainant suffered physical and mental agony, as well as financial loss. The respondent/complainant filed complaint before the District Forum, seeking direction to the appellant/O.P./Insurance Corporation to pay the insurance amount, along with bonus and entire benefits along with interest @ 12% p.a., compensation for mental agony, cost of litigation and other compensation, as Hon'ble Court deems fit.
3. The appellant/O.P./Insurance Corporation filed its written version and denied the allegations leveled by the respondent/complainant in the complaint and averred that at the time of making proposal for the insurance on 28.11.2006, the deceased policy holder Late Smt. Pushpa Bhattacharya had given false and incorrect information regarding her health. Actually prior to making proposal for the insurance, the policy holder suffered heart disease in // 4 // the month of February 2006 and was also suffering from the disease of diabetes since last 14 years. The policy holder replied in negative form to the questions asked as serial no.11 of the proposal form is in respect of her personal history and she intentionally suppressed the facts regarding the previous diseases. The appellant/O.P./Insurance Corporation further averred that in the proposal form, the person whose life is herein being proposed to be assured, do hereby declare that the foregoing statements and answers have been given by him/her after fully understanding the questions and the same are true and complete in every particular and that he/she has not suppressed any information and do hereby agree and declare that these statements and this declaration shall be the basis of the contract of assurance between him/her and the Life Insurance Corporation of India and that if any untrue averment be contained therein, the said contract shall be absolutely null and void and all monies which shall have been paid in respect thereof shall stand forfeited to the Corporation. The death of the mother of the complainant, namely Smt. Pushpa Bhattacharya occurred on 16.10.2009 i.e. within 3 years from the date of obtaining the insurance policy, which comes in the category of "early claim". As per provisions, the claim of the respondent/complainant was investigated and it was clear the policy holder had given false and incorrect information in the proposal from in respect of heart disease and diabetes, which are serious diseases and to which the policy holder // 5 // suffered and she intentionally suppressed material facts. The appellant/O.P./Insurance Corporation informed the respondent /complainant vide letter dated 23.12.2010 that as the policy holder has suppressed the material facts in the proposal form for the insurance, therefore, the appellant/O.P./Insurance Corporation, is not liable to pay the insurance amount and other benefits and her claim was not allowed. Thus, the appellant/O.P./Insurance Company did not commit any deficiency in service and the complaint of the respondent/complainant is baseless, hence the complaint of the respondent/complainant, be dismissed.
4. Learned District Forum after having considered the material placed before it by both the parties, allowed the complaint and awarded compensation, as mentioned in para 1 of this judgment.
5. Shri D. Dutta, learned counsel for the appellant/O.P. argued that the order of the District Forum, is contrary to the facts mentioned in the written version of the appellant/O.P./Insurance Corporation, as well as documents available in the record of the District Forum, hence the impugned order is liable to be set aside. He further argued that the impugned order is contrary to the law. The District Forum has not properly analysed the documents produced by the appellant/O.P./Insurance Corporation and passed the impugned order in casual manner. He further argued that looking to the documents // 6 // filed by the appellant/O.P./Insurance Corporation, it appears that deceased Smt. Pushpa Bhattacharya, was suffering from diabetes since last 14 years and she was also a heart patient and above facts were intentionally suppressed by the insured at the time of making proposal for the insurance policy. Therefore, the respondent/complainant is not entitled for any benefit in respect of insurance policy in question and order of the District Forum, is erroneous and is liable to be set aside.
6. Shri Bharat Jaiswal, learned counsel for the respondent/complainant, supported the impugned order. He further argued that deceased insured had never suppressed any material facts to the appellant/O.P./Insurance Corporation prior to obtaining insurance policy. Merely mentioning that deceased insured was suffering from diabetes, is not sufficient to repudiate the claim of the respondent/complainant.
7. We have heard the counsel for both the parties at length and have also perused the record of the District Forum minutely.
8. The respondent/complainant filed document A-1 and A-2 i.e. repudiation letter dated 23/12/2010 sent by the Senior Divisional Manager, Life Insurance Corporation of India, Divisional Office, Bilaspur (C.G.) to Ku. Manju Bhattacharya (respondent/complainant). Document A-3 is death certificate of Smt. Pushpa Bhattacharya, the // 7 // mother of the respondent/complainant issued by the Registrar, Birth & Death.
9. Appellant/O.P. /Insurance Corporation has filed document B-1 to B-6 i.e. proposal for insurance, document B-7 is insurance policy issued in the name of Smt. Pushpa Bhattacharya, document B-9 & B-10 is repudiation letter dated 23/12/2010 sent by the Senior Divisional Manager, Life Insurance Corporation of India, Divisional Office, Bilaspur (C.G.) to Ku. Manju Bhattacharya (respondent/complainant), document B-11 is medical opinion obtained from DMR for claim cases, document B-12 is Medical Service Card, document B-19 is Medical Attendant's Certificate, document B-20 & B-21 is Certificate of Hospital Treatment, document B-22 is Claimant's Statement, document B-24 is a Certificate issued by the employee of the employee.
10. Deceased Smt. Pushpa Bhattacharya obtained insurance policy No.384223641 for the value of Rs.1,00,000/- from the appellant/O.P./Insurance Corporation and at that time, she submitted proposal form for insurance on her life on 30.11.2006. In the proposal form (document B-1 to B-6) in sub clause (d) and (e) of clause 11 it is mentioned thus :
11 Personal History Answer If Yes, please Yes/No give full details
(d) Are you suffering from or have you ever suffered from ailments pertaining to Liver, Stomach, Heart, Lungs, // 8 // Kidney, Brain or Nervous system ? NO
(e) Are you suffering from or have you ever suffered from Diabetes, Tuberculosis, High Blood Pressure, Low Blood Pressure, Cancer, Epilepsy, Hernia, Hydrocele, Leprosy or any other disease ? NO In reply to the aforesaid questions, the deceased insured gave reply in negative form.
11. Document B-11, is Form to obtain medical opinion from DMR for claim cases. In para 8 of this document it is mentioned thus :-
"8.SPECIFIC POINT ON WHICH INFORMATION IS SOUGHT:
Any disease not disclosed at the time of proposal which could have affected underwriting decision. [As per OPD book she was type 2 Diabetic since last 14 years."
12. Document B-19 is Medical Attendant's Certificate. In the said document it is mentioned that :-
4. a. What was the exact cause of a. Primary cause:
SEPSIS with death ? SHOCK.
(Besides defining the disease Secondary cause: RESPIRATORY
or other cause of death in FAILURE FAILURE WITH CRF WITH
such terms as you consider HT WITH DM WITH OAD
appropriate kindly add the
distinctive technical name).
b.Was it ascertained by b. DURING LIFE.
examination after death or
inferred from symptoms and
appear once during life ?
c. How long had he been c. SINCE 1 ½ MONTH.
suffering from this disease
before his death?
d. What were the symptoms of d. HIGH GRADE FEVER, LOSS OF
the illness? APETITE.
// 9 //
e.When were they first e. 1 ½ month back.
observed by the deceased?
f. What was the date on which f. 9/10/2009
you were first consulted
during the illness?
g.Did you attend him during g. YES 09/10/09 TO 16/10/09. the whole of the course? If not state during what period?
13. In Life Insurance Corporation of India v. Shahida Khatoon & Anr., IV (2013) CPJ 370 (NC), Hon'ble National Commission observed thus :-
"12. We have relied upon several judgments of Hon'ble Supreme Court in cases Satwant Kaur Sandhu v. New India Assurance Co. Ltd., IV (2009) CPJ 8 (SC) = VI (2009) SLT 338 = (2009) 8 SCC 316, P.C. Chacko and Anr. v. Chairman, LIC of India, III (2008) CPJ 78 (SC) = IX (2007) SLT 533 = IV (2007) ACC 773 (SC) = (2008) 1 SCC 321, LIC of India v. Smt. Asha Goel, I (2001) SLT 89 = (2001) 2 SCC 160, have discussed the term "Material Fact" as fact which goes to the root of the contract of insurance and has a bearing on the risk involved would be material. The term material fact is not defined in the Act and, therefore, it has been understood and explained in general terms to mean as any fact which influence the judgment of a prudent insurer in fixing the premium or determine whether he would like to accept the risk.
13. Therefore, we do not find any force in the arguments of Counsel for complainant/respondent. Both the Fora below have erred in not considering the non-disclosure of material facts by the deceased and filled the proposal form. Accordingly, we set aside the orders passed by Fora below and allow this revision petition by dismissing the complaint. No order as to cost".
// 10 //
14. In L.I.C. of India v. Pratima Mishra, IV (2013) CPJ 161 (Chha.), this Commission observed thus :-
"8. Even if we presume that the deceased was required to notify anything to the Insurance Corporation as per terms and conditions of the acceptance, as per printed material available in the bottom of receipt of deposit of premium, even then requirement was only this that if there is any change in the occupation of the insured, then it was required to be notified and if there is any adverse circumstances connected with financial position or the general health of the proposer or that of any members of his family then if that circumstance may be very much unimportant, but the same if occurred between the date of proposal and date of this receipt or if on a proposal for assurance or an application for revival of a policy on the life made to any office of the Corporation, then it was required to be notified. Thus, what was required to be notified was any change in the occupation of the insured or any adverse circumstances affecting the insured or his family members. If deceased insured suffered a road accident, but immediately after treatment it was found that he was not having any bony injury. When no adverse circumstances relating to his health was stated by any of the doctors to the deceased insured, then it was not required for him to notify anything to the Insurance Corporation. Even in the receipt, which was obtained by the deceased after deposit of the premium, only such terms and conditions were printed.
9. Documents in respect of treatment of deceased insured, which have been brought on record by the appellant before the District Forum are photocopies of the treatment of the deceased insured in Ramkrishna Care Hospital, Raipur as well as Chandulal Chandrakar Memorial Hospital, Bhilai. From these documents, it appears that as per noting of Ramkrishna Care Hospital, Raiapur on C.T. Scan, it was found that there was no bony injury and all four limbs could be raised by him.
// 11 // Pupil of both eyes were normal. Thus, nothing substantial was noted by the Hospital for which it can be said that it was a circumstance which had adversely affected the health of the insured and was required to be notified by him to the Insurance Corporation. Later on he was treated with Chandulal Chandrakar Memorial Hospital, Bhilai from
15.03.2008, where ultimately he died on 16.03.2008. Thus, from record of the treatment given in Ramkrishna Care Hospital, it appears that it is not containing any such information which can be said to be relating to circumstance adversely affected the health of the deceased insured and was required to be notified by him to the Insurance Corporation."
15. In L.I.C. of India v. MU Jakia, IV (2013) CPJ 129 (NC), Hon'ble National Commission observed thus :-
"15. It is an undisputed fact that Shri Akhil Khan the deceased had taken LIC policy from the respondent for a sum of Rs.51,000/- on 1.1.2004. It is also an admitted fact that as per the bed head ticket of Maharana Bhopal Hospital, Udaipur the deceased was admitted to the hospital on 3.6.2003 for the treatment of chronic renal failure, hypertension, septicaemia, nephritis and was discharged from the hospital on 6.6.2003. While the State Commission has correctly come to the conclusion that the petitioner were justified in repudiating the claim of the respondents on the ground of suppression of material fact regarding health and that the finding of the District Forum rejecting the claim of the respondents were based on correct appreciation of entire material 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 appeal was dismissed. The State Commission erroneously went on to award an ex gratia payment on humanitarian consideration of Rs.15,000/-. This is beyond the // 12 // pleadings of the respondents. Further, in P.C. Chacko and Anr. v. Chairman Life Insurance Corportion of India and Ors., IV (2007) ACC 773 (SC) = IV (2007) CLT 229 (SC) = IX (2007) SLT 533 = III (2008) CPJ 78 (SC) = 2007 XAD (SC) 429, in which paragraph 20 which is relevant to us in this case reads as under :
"We are not unmindful of the fact that Life Insurance Corporation being a state within the meaning of Article 12 of the Constitution of India, its action must be fair, just and equitable but the same would not mean that it shall be asked to make a charity of public money, although the contract of insurance is found to be vitiated by reasons of an act of the insured. This is not a case where the contract of insurance or a clause thereof is unreasonable, unfair or irrational which could make the Court carried the bargaining powers of the contracting parties. It is also not the case of the appellants that in framing the aforesaid questionnaire in the application/proposal form, the respondents had acted unjustifiably or the conditions imposed are unconstitutional."[See also Life Insurance Corporation of India & Anr. v. Vinod Devi, IV (2013) CPJ 142 (NC)].
16. The National Commission in RP Nos. 858, 894, 995, 1435, 1446, 1503, 1504, 1505, 1553, 1554, 1679, 1680, 1722, 1723, 3631 of 2009, 1504 of 2006, 3147, 3789, 3855, 3858 to 3860, 3917, 3918, 4662, 4663, 4726, 4727, 4836, 4837, 5009, 5010, 5030 of 2008, 23, 164, 331, 359, 1909, 1926, 2945, 2946, 3094, 3097 of 2009 decided on 17.12.2009 have stated as under :-
"We are afraid in terms of provisions of Consumer Protection Act 1986, we are not free to do a 'favour' to a party. As, far as the moral obligation is concerned, that has to be done 'voluntarily' by the authority concerned. The Consumer Fora cannot pass or give direction or order to give a 'favour' // 13 // otherwise the word more grounds are voluntarily will lose its very meaning.
While going through the aim and objectives of the Consumer Protection Act, 1986, as highlighted by the learned Counsel for the respondent we are of the view that a distinction needs to be made between justice - natural or otherwise and 'favour'. There is no room for favouritism while dispensing justice. The word ' ex gratia' has been interpreted / understood to mean favour', rendered 'voluntarily' and on 'moral grounds', thus, clearly ousting the jurisdiction of quasi-judicial bodies like ours to direct a party to show favour. If we do this, this will not only run counter to the letter and spirit of Consumer Protection Act but also assume / confer powers which are not conferred upon us by Law / mandate. Any direction by Consumer Fora to the party concerned to grant ex gratia payment will defeat the very purpose and meaning of 'ex gratia', i.e., favour, grace shown voluntarily on moral grounds.
However, this order would not deter directing payment of ex gratia' basis by the Consumer Forums, provided, the concurrence of the sanctioning authority of insurance company, is obtained through their Counsel (Counsel for the Insurance Company) for making the payment on 'ex gratia' basis."
16. Looking to the documents filed by the appellant/O.P./Insurance Corporation, it appears that Smt. Pushpa Bhattacharya, was suffering from diabetes since last 14 years and the insured suppressed above material facts at the time of submitting proposal form for the insurance to the appellant/O.P./ Insurance Corporation.
// 14 //
17. From above discussions, it becomes clear that the respondent/complainant has not come with the clean hands and the deceased insured Smt. Pushpa Bhattacharya has suppressed material facts regarding her sufferance from the diabetes since last 14 years when she obtained policy and at that time she was a patient of diabetes and above fact was not mentioned in the proposal form for the insurance. Therefore, the appellant/O.P./Insurance Corporation has rightly repudiated the claim of the respondent/complainant. The impugned order passed by learned District Forum, is erroneous and is labile to be set aside.
18. Consequently, the appeal filed by the appellant/O.P./Insurance Corporation, is allowed and impugned order dated 19.12.2012 passed by the District Forum, Bilaspur (C.G.) in Complaint Case No.192/2011 is set aside and complaint filed by the respondent/complainant before the District Forum, Bilaspur (C.G.), is dismissed. There shall be no order as to costs.
(Justice R.S. Sharma) (Ms. Heena Thakkar)
President Member
/02/2014 /02/2014