Life Insurance Corporation of India vs Mohinderjit Kaur

CHALLENGING order of District forum, Kapurthala dated 7.11.1996, the appellant before us is the Life Insurance Corporation, opposite party before the District Forum. Vide order under challenge, the District Forum has accepted the complaint of Mohinderjit Kaur with costs and directed the opposite party to pay Rs. 70,000/- sum insured under the policy of insurance alongwith interest @ 18% from the date of complaint upto realisation and for mental tension and torture Rs. 2,500/- as compensation has been granted, and additional amount of Rs. 1,000/- as costs has been allowed.

THE complainant Mohinderjit Kaur is the widow of the insured Sh. Manjit Singh, who had got a policy of Insurance of his life on 25.11.1992 for a sum of Rs. 70,000/- and on 14.1.1995 on account of complaint of chest pain, he was removed to P.H.C-, Bhulath, where he expired on 14.1.1995 it self. Intimation regarding date of death was given to the Insurance Corporation on 21.2.1995 and the claim was repudiated by the opposite party vide its order dated 26.7.1996 which was challenged before the District Forum. On notice being served, the opposite party filed its version taking number of preliminary objections. After affording due opportunity of leading evidence, to the parties and hearing Counsel for the parties, the District Forum has passed the order under challenge. We have heard Mr. B.J. Singh, learned Counsel for the appellant-Life Insurance Corporation and Mr. K.L. Menon, Advocate for the complainant/respondent.

In almost every case filed before this Commission against it. Life Insurance Corporation has been agitating and urging that there is bonafide repudiation of the claim and the Consumer FORAs are not justified to sit over the said bonafide repudiation of claims and the proper remedy with the complainant is the Civil Court and the Consumer FORA are not entitled to grant interest and so is the pleas taken in this appeal also. We have been repeatedly holding that the repudiation of the claim by me Insurance Corporation does not bar the jurisdiction of the Consumer FORA established under the Consumer Protection Act and have been holding that the Consumer FORA are within their legitimate fields to exercise the power of judicial review if there is deficiency of service in rejecting the claim. It has been the considered view of this Commission that in money transaction in the absence of solid and specific proof the best method of granting the damages/compensation is the interest and this Commission with an exception of one or two cases has been granting interest @ 18% per annum. Suffice it to say that Consumer Disputes Redressal Forums are quasi-judicial authorities and are thus governed by the well established principles of binding nature of its own earlier decisions. In legal matters some degree of certainty is as valuable as part of justice as perfection. The Tribunal must follow its own decision and the decisions of the superior Tribunal to which they are subordinate. A decision of a Tribunal is binding not because of its conclusion but in regard to its ratio and principle laid therein. A decision is given per-incuriam when the Tribunal has acted in ignorance of the decision of its own or of any Tribunal of cordinate jurisdiction which cover the case for it or when it has acted in ignorance of a decision of the superior Court. The view taken by the Supreme Court on a question of law binds all Courts and Tribunals under Article 141 of the Constitution.

WHILE attacking the order of the District Forum and justifying the repudiation order passed by the Life Insurance Corporation, Mr. Singh vehemently contended that the death of the insured having taken place just after two years and being a very early claim investigations were got conducted by the appellant and it was found that deceased had not been maintaining good health prior to the submission of the Proposal Form i.e. 24.11.1992 and has taken treatment for the same vide Ex. R-3 from Dr. Vishnu Dutt Agnihotri and vide Ex. R-4 and Ex. R-7from Government Primary Health Centre, Bhulath, District Kapurthala and it has been stressed that treatment taken was for Asthma and the cause of death was Myocardial infection and the life insured has concealed the factum of his suffering from the Chronic Bronchial Asthma. So far as the certificate Ex. R-3 issued by R.M.P. Dr. Vishnu Dutt Agnihotri is concerned, it stands belied in view of the affidavit filed by said Dr. Agnihotri before the District Forum wherein he has categorically stated that said Manjit Singh was not a patient of Asthma and Pyorrhea and he has never diagnosed him for the said disease and the Manager, Life Insurance Corporation has obtained false certificate from him by playing threat and coercion and fraud. Said Dr. Agnihotri was not cross-examined by the Corporation. In our view the District Forum rightly discarded the certificate Ex. R-3 issued by Dr. Agnihotri. It is worthwhile to mention here that in certificate Ex. R-3 it has been mentioned that the deceased Manjit Singh had been taking treatment from the Government Hospital, Bhulath. For the reasons best known to the Insurance Corporation, it has not recorded the statement of any Doctor or a Doctor of Government Hospital and nor it has cared to scrutinise the record of treatment taken by Manjit Singh from Government Hospital, Bhulath. The Certificate Ex. R-7 is dated 16.3.1995. In the said certificate it has only been mentioned that he was treated in the hospital for 3-4 times before. The date or month or the year when he got the treatment from the hospital has not been mentioned. It is quite possible that the treatment might be after getting the insurance policy. In any case the learned Counsel has not referred to any medical literature or evidence on the file to indicate that Chronic Bronchial Asthma allegedly suffered by Manjit Singh has caused Myocardial infection stated to be cause of death. The burden of proving that the insured has made false representation and supressed the material facts is on the Life Insurance Corporation. It is not the case of the Insurance Corporation that the deceased had been taking treatment for a period spread-over weeks. Coupled with the fact that the policies were taken more than 2 years prior to death. Thus the Corporation utterly failed to establish any nexus between the cause of death (Myocardial infection and the disease (Bronchial Asthma to the deceased). Therefore, even if the deceased had failed to disclose that he was suffering from Bronchial Asthma at the time when he made the proposal, the liability under the policy cannot fly on the ground of suppression of material facts. The death of the deceased having not been connected with Bronchial Asthma, it cannot be considered to be material so far as the death of the deceased is concerned. Consequently, it cannot be said that there was suppression of material facts and, therefore, no liability of the Corporation arose under the policy. Whether a fact is material or not has to be decided in the light of and in the context of the cause of death. If the fact has bearing on the cause of death it would become material, otherwise, it could not be said to be material. Mere incorrect, and wrong answers to questions which ultimately do not have any bearing or connection with the death of the insured would not absolve the Corporation from its liability under the policy. Therefore, it must be held that the Corporation was not justified in repudiating the claim made by the complainant.

THE matter can be looked into from another angle. Date of death is 14.1.1995. Intima-tion of death had been sent to the opposite party on 21.2.1995 and the certificate Ex. R-3 is dated 4.5.1995 and the certificate Ex. R-7 is dated 16.3.1995 and the repudiation letter is dated 26.7.1996. No explanation whatsoever has been produced on the file for sitting over the case file after May, 1995. This is a clincher point to the fact that the claim was not treated in a bona fide manner. This Commission has repeatedly held that if the claim lodged is not decided within 3 or 4 months of the date of lodging of the complaint by the Corporation, the delay per-sc is sufficient enough to saddle the charge of deficiency of service against the Corporation. In this view of the matter also, the repudiation letter cannot be justified. Learned Counsel for the complainant/ respondent has stated that under the Life Insurance Policy issued to the insured, the complainant is entitled to the bonus of Rs. 11,676/- (calculated by the Counsel), and the District Forum has grossly erred in not awarding the said bonus. It has not been disputed by the learned Counsel for the appellant Corporation that the bonus is payable under the policy, but unfortunately there is no appeal by the complainant. Be that as it may. In view of the peculiar facts and circumstances of the case, we exercise our suo motu revisional jurisdiction and direct the opposite party/appellant to pay the bonus admissible under the policy to the complainant. Before parting with the judgment, it may be mentioned that this has been the considered view of this Commission that 18% interest on the amount insured includes the compensation for mental tension and torture etc. and hence the District Forum was not justified to grant compen sation of Rs. 2,500/for mental tension and torture. For the reasons recorded above, the present appeal is dismissed being devoid of any merit. Consequently, we direct the opposite party/ appellant to pay the sum assured alongwith bonus payable under the policy alongwith interest @ 18% per annum on the awarded amount from the date of death i.e. 14.11.1995 till its realisation. The complainant is also to be entitled to the costs before the District Forum and before this Commission, which are assessed to be Rs. 2.000/-. It may be clarified here that costs awarded includes the costs granted by the District Forum. Appeal dismissed with costs.