RATTAN KUMAR vs LIFE INSURANCE CORPORATION OF INDIA

THIS appeal has been directed by the complainant Rattan Lal against order dated 19.1.2005, passed by the District Consumer Disputes Redressal Forum -II, U.T. Chandigarh, whereby his complaint was dismissed leaving the parties to bear their own costs.

BRIEFLY stated the facts are that Smt. Satya Rani, now deceased, mother of the appellant had taken an insurance policy No. 162321282, on her life from the respondent for Rs. 75,000 for the risk period commencing from 28.12.2002 However, she breathed her last on 19.2.2003 i.e., less than two months of her taking the policy. After the death of Smt. Satya Rani, her nominee Sh. Rattan Kumar, appellant (son) filed insurance claim with the respondent, who repudiated the claim and refused to pay the insured amount on the ground that Smt. Satya Rani had not made full and honest disclosure about her health in the proposal form. The said repudiation was challenged by the appellant, being wrong and unjust, on the ground that she was enjoying perfect normal health at the time of purchasing the policy, and as such, he be paid the insured sum of Rs. 75,000 besides compensation for harassment, mental agony and inconvenience along with interest till the date of payment and legal expenses incurred by him.

RESPONDENT contested the complaint and filed written statement. It took certain preliminary objections; that the appellant was not a consumer; that the District Forum had no jurisdiction to try the complaint and he should be relegated to the Civil Court, and that there was no subsisting contract. On merits, it did not deny the factual position and stated that the aforesaid policy for a sum of Rs. 75,000 was issued on the life of Smt. Satya Rani on 28.12.2002, on the basis of proposal dated 27.12.2002 but she made false averments in the proposal form. It next stated that Smt. Satya Rani died due to heart failure, but no history of ailment was given at the time of proposal. Since, death had taken place within short period from the date of insurance, so, investigation was made into the suspicious claim and it was revealed that she had been getting treatment for her disease and was not maintaining good health, thus, it was fraudulently not disclosed by Smt. Satya Rani on 27.12.2002 that she was suffering from heart disease.

PARTIES led evidence in the shape of affidavits and documents. After hearing the Counsel for the parties, the District Consumer Disputes Redressal Forum -II, vide its order dated 19.1.2005 dismissed the complaint by holding that Smt. Satya Rani had not disclosed true facts about her health at the time of proposal on 27.12.2002, and as such the insurance policy was void ab initio and there was no deficiency in service on the part of respondent.

AGGRIEVED by the said order, com -plainant has filed the present appeal.

WE have heard Sh. R.C. Kapoor, Counsel for the appellant, Smt. Vandana Malhotra, Counsel for respondent and carefully gone through the file. It is an admitted fact that Smt. Satya Rani, mother of the appellant, had taken insurance policy No. 162321282 for a sum of Rs. 75,000, by submitting proposal dated 27.12.2002. The date of commencement of the policy was 28.12.2002. The said policy was issued believing the averments made in the proposal form to be correct. However, she breathed her last on 19.2.2003 i.e., within two months of her taking the insurance policy. The allegation of respondent is that since the death had occurred within two months of the proposal and being a suspicious claim, so, the matter was investigated by it and on investigation, it was found that the life assured had not been maintaining good health prior to submitting of proposal dated 27.12.2002, and had been taking treatment for the same which was not disclosed in the proposal dated 27.12.2002.

WHILE considering the provisions of Section 45 of the Insurance Act, 1938, in the case of LIC of India and Others v. Asha Goel and Another, 2001 ACJ 806, the Honble Apex Court held that the burden of proving the fact that there was material and substantial concealment of facts regarding the true state of health is on the party alleging the same, i.e., on LIC of India in the instant case and the suppression should be in respect of material and substantial facts regarding the true state of health. The Honble Apex Court observed in para -11, inter alia as under: ''...on a fair reading of the section, it is clear that it is restrictive in nature. It lays down three conditions for applicability of the second part of the section, namely (a) the statement must be on a material matter or must suppress fact which it was material to disclose; (b) the suppression must be fraudulently made by the policy holder; and (c) the policy holder must have known at the time of making the statement that it was false or that it suppressed facts which it was material to disclose. Mere inaccuracy or falsity in respect of some recitals or items in the proposal is not sufficient. The burden of proof is on the insurer to establish these circumstances and unless the insurer is able to do so there is no question of the policy being avoided on ground of misstatement.''

THE appellant had examined C.W. 1 Dr. Rakesh Kumar Soni, who had medically examined Smt. Satya Rani on 30.12.2002, regarding her proposal to get herself insured. He stated that on his examination, apparently, he did not find any symptoms of medical problem and he found that she was healthy. He further stated that he had signed medical report Ex. C.W. 1/A and identified his signatures and his seal on it. He further stated that Smt. Satya Rani put her thumb impression on it. He also stated that he had been appointed by the Life Insurance Corporation as medical examiner and had been working in this capacity for about six years. In cross -examination, he stated that if Smt. Satya Rani had disclosed to him any of her pre -existing ailments, then he would have further investigated that aspect of her ailment. A perusal of the proposal form O.P. 2 shows that she did not disclose that she was suffering from any heart disease. In fact, she had stated that she was not suffering from any disease. C.W. 2 Sh. Bishan Swaroop simply introduced Smt. Satya Rani to Dr. Rakesh Kumar Soni, C.W. 1 and the proposal form C.W. 2/A was filed by him at the instance of Smt. Satya Rani, and on the information supplied by her to him. He further stated that he was unable to say whether Smt. Satya Rani was healthy or not, at the time of her making the proposal. However, she did not appear to him to be ill. Life Insurance Corporation of India, on the other hand, had examined R.W. Dr. Sanjay Kalra. He stated that he passed degree of BAMS and had also passed M.D. in Acupuncture and had been practising medicine for the last about seven years. He further stated that certificate Ex. O.P. 7 in respect of Smt. Satya Rani was issued by him. He next stated that Smt. Satya Rani had been his regular patient for the last four years prior to the issue of the said certificate which was issued on 23.7.2003 and she had been suffering from C.C.F. (Congestive Cardiac Failure) for the last one year, prior to the date of issuance of certificate. He next stated that earlier to C.C.F., she had been suffering from C.O.P.D. and hypertension and she had been getting regular treatment from him as an outdoor patient. He further stated that he had been maintaining regular record of his patients which he had brought on that date and Smt. Satya Rani visited him as an outdoor patient for treatment on 1.10.2001, 1.11.2001, 15.11.2001, 9.12.2001, 20.12.2001, 17.2.2002, 23.2.2002, 27.2.2002, 1.3.2002, 9.3.2002, 25.3.2002, 27.3.2002, 8.4.2002, 14.4.2002, 26.4.2002, 10.5.2002, 17.5.2002 and 5.6.2002. Thus, according to him, Smt. Satya Rani visited 18 times as an outdoor patient to get treatment from him. In his cross -examination, he admitted that he is not a heart specialist but he had experience of treating heart diseases and he was a doctor on the panel of LIC, and Smt. Satya Rani was her regular patient. He further stated that Sh. Jaswinder, son of Smt. Satya Rani was employed in Power House, Naraingarh and Smt. Satya Rani had given her address that of Sh. Jaswinder and he knew Sh. Jaswinder as he used to visit his clinic along with Smt. Satya Rani for her treatment. He next stated that Sh. Jaswinder had told him that Smt. Satya Rani had died and they had filed a claim for insurance on account of her death. It is for this reason, he stated that Smt. Satya Rani was the same lady, who used to get treatment from him, although her husbands name or fathers name was not mentioned in the register. He further stated that since he had studied medicine and obtained a degree in Acupuncture, he knew symptoms of Congestive Cardiac Failure and even clinically could diagnose a case of Congestive Cradiac Failure. He also stated that he performed ECG and clinically examined her and the OPD ticket was given to her by him, after recording his diagnosis and prescription. But in the register he had not mentioned the disease from which she was suffering.

THE District Forum has stated in its order dated 19.1.2005 that the complainant (appellant) had admitted the query from the Forum that Sh. Jaswinder, who was employed in the Power House at Naraingarh, was his elder brother. Sh. Jaswinder had not been examined to controvert the allegations of R.W. Dr. Sanjay Kalra and to state that his mother was not suffering from heart disease and she never got treatment from Dr. Sanjay Kalra and, therefore, he never accompanied his mother to the clinic of Dr. Sanjay Kalra for treatment. The very fact that Sh. Jaswinder has been withheld by the appellant, suggests that he used to accompany his mother Smt. Satya Rani to the clinic of Dr. Sanjay Kalra for treatment as she was suffering from some heart ailment. If, Sh. Jaswinder had not accompanied her mother, then it would have been difficult for Dr. Sanjay Kalra to tell the address of Sh. Jaswinder and that he was employed in the Power House at Naraingarh.

THE appellant had mentioned in the claim form which he gave to the Life Insurance Corporation of India, Chandigarh, Annexure O.P. 5, that his mother Smt. Satya Rani died due to heart failure. Therefore, it is not denied that she had not died to heart failure. The statement of Dr. Ramesh Kumar Soni does not positively show that she was not suffering from any heart disease because her examination is based on the statement of Smt. Satya Rani. Thus, there is no dispute that Smt. Satya Rani suppressed material fact about her health and the LIC has rightly repudiated the claim of the nominee after her death and there is no deficiency in service as contemplated under Section 2(1)(g) of the Consumer Protection Act, 1986. Our view is supported by the authority of National Commission Smt. Vidya Devi, etc. v. Life Insurance Corporation of India, II (2003) CPJ 106 (NC)=2001 NCJ (NC) 476. The authorities in Life Insurance Corporation of India v. Jasbir Kaur, I (2005) CPJ 781 and Life Insurance Corporation of India and Others v. Asha Goe, (Smt) and Another,(2001) 2 Supreme Court Cases 160, cited by the learned Counsel for the appellant are not applicable to the fact of the present case. In Jasbir Kaurs case, it was held that if the insured had been suffering from Cirrhosis of liver then there would have been swelling on feet and abdomen which could have been noted on physical examination. However, in our opinion, if the insured had been suffering from heart ailment, it could not be noticed from physical examination. In Asha Goels case, it was held by the Honble Supreme Court that repudiation of policy on the ground of mis -statement on the part of LIC should be one of extreme caution and care, and such a matter should not be dealt with in a mechanical and routine manner. It is further held that Section 45 of the Insurance Act, 1938, is restrictive in nature and the burden of proof lies on insurer to establish the circumstances mentioned in the section. But in our opinion, the present case is not covered under Section 45 of the Insurance Act. The insurance is a contract of utter good faith, but Smt. Satya Rani knowingly gave incorrect information regarding her health, and as such the life Insurance Corporation is not liable.

IN view of the above discussion, we hold that there is no force in the appeal and the same is dismissed. But in the circumstances of the case the parties are left to bear their own costs. Copies of the order be communicated to the parties, free of charge. Appeal dismissed.