Life Insurance Corporation of India vs Baljit Kaur

ON a complaint instituted by Smt. Baljit Kaur widow of Sh. Maghar Singh, the District Consumer Forum II, UT, Chandigarh, ordered on 14.5.1997 that the insured sum of Rs. 50,000/- together with interest @ 12% and costs 1,100/- shall be payable by the LIC of India. Aggrieved against it, the present appeal has been attempted.

MAGHAR Singh executed a proposal for insurance on his own life on 15.11.1993. He deposited a sum of Rs. 1,111 /- in cash which was the required amount of the premium. However, before issuance of a formal insurance policy, he died on 10.2.1994 and the claim made by Smt. Baljit Kaur, the widow, who was named as the nominee has been repudiated. On behalf of the LIC of India, the appellant, it has been argued that in the case of LIC policy, the mere fact that proposal form has been filled and the premium actually deposited did not entitle an heir, or a nominee to the amount claimed. It is a pre-requisite that the acceptance of the proposal is made by the LIC and contract completed.

On behalf of the appellant, it has been pointed out that vide letter dated 26.11.1993 (Annexure R3) during the life time of Maghar Singh ''age proof was demanded. On behalf of the respondent, it has been pointed out that in the columns specified for nature of age proof, the word "SC" i.e. school certificate is mentioned. This goes to show that the school certificate was furnished by Maghar Singh at the time the Form Annexure R2 was filled and submitted to the agent of the appellant. Maghar Singh was a permanent Government employee of Punjab State and was working as Senior Assistant. Not only the fact that his age was 45 was recorded, the specific date of birth i.e. 3.3.1994 was also mentioned in the appropriate columns of the Form Annexure R2. It was nowhere the case or plea of the appellant that Maghar Singh mentioned wrong age or date of birth in the Form filled in his own hand. He had deposited the sum of Rs. 1,111/- on 8.11.1993 in cash which was also accepted and deposited with the LIC. Thus, it is a case where all essential acts on the part of Maghar Singh were performed well within his life time. The learned Counsel for the appellant has referred to Life Insurance Corporation of India v. Raja Vasireddy Komalavalli Kamba and Others, AIR 1984 Supreme Court 1014, wherein the essential stages of the Life Insurance Policy were considered and it was observed that the stage "underwrite" is always to be crossed and the LIC is to be satisfied with the contents contained in the proposal form. As seen above, there was nothing to contradict any of the contents in the proposal form in this case either during the lifetime of Maghar Singh or even thereafter. The facts of the Kerala case referred to above were infact distinguishable. In the aforesaid case, the cheque pertaining to premium was dishonoured thrice and the person died on the next day, whereas in the case know in hand, as seen above, the premium was paid in cash and it was accepted and receipt thereof issued.

ON behalf of the appellant, it has been pointed out that the sum of Rs. 1,111/- was refunded to Smt. Baljit Kaur widow of Maghar Singh by means of a cheque dated 2.6.1994 and the cheque was also revalidated. This circumstance alone would not go against the respondent widow who could never understand the implications now claimed on behalf of the appellant and not admissible because the contract was complete in all respects during the life time of Maghar Singh. After considering all these facts and circumstances, we hold that the repudiation made on 5.5.1994 constituted deficiency on the part of the LIC. The conclusion is that there is no merit in this appeal and it is hereby dismissed with costs assessed as Rs. 500/-. Appeal dismissed with costs.