UNDERWRITING DEPARTMENT BAJAJ ALLIANZ LIFE INSURANCE COMPANY LTD & ANR vs PRIYANK PATIL

K. S. Chaudhari, Presiding Member

[1] This revision petition has been filed by the petitioners against the order dated 31.3.2010 passed by the Karnataka State Consumer Disputes Redressal Commission, Bangalore (in short, ''the State Commission'') in Appeal No. 919 of 2009 The Underwriting Deptt. & Anr.Vs. Sri. Priyank Patil by which, while dismissing appeal, order of District Forum allowing complaint was upheld.

[2] Brief facts of the case are that father of complainant/respondent obtained life insurance policy from OP/petitioner for a sum of Rs.20,00,000/- by paying a premium of Rs.50,000/- and complainant was nominee in the policy. Insured met with an accident on 5.3.2007 and died on 15.3.2007. Complainant lodged claim with OP and OP on 7.11.2007 issued cheque for a sum of Rs.48,850/- which was returned by the complainant because complainant was entitled to receive Rs.20,00,000/-. Alleging deficiency on the part of OP, complainant filed complaint before District Forum. OP resisted complaint and submitted that as proposal of complainant''s father was not accepted by OP and life risk had not commenced as on the date of death of complainant''s father, claim was rightly repudiated and prayed for dismissal of complaint. Learned District forum after hearing both the parties allowed complaint and directed OP to pay Rs.20,000/- to complainant. Appeal filed by OP was dismissed by learned State Commission vide impugned order against which, this revision petition has been filed along with application for condonation of delay.

[3] Heard learned Counsel for the parties and perused record.

[4] Learned Counsel for the petitioner submitted that delay of 35 days occurred in filing revision petition on account of time taken in obtaining opinion from the Advocate, and on account of Advocate not at headquarter due to vacations in High Court and Supreme Court, delay may be condoned. Learned Counsel for the respondent submitted that no reasonable explanation has been given for condonation of delay; hence, application be rejected. Perusal of application reveals that opinion was received from the Advocate in the last week of May, 2010, but Advocate on record could be contacted only in the first week of July, 2010 and revision petition was filed on 30.8.2010. Looking to the period of delay, I deem it appropriate to condone delay subject to cost for the reasons mentioned in the application. Consequently, application for condonation of delay is allowed and delay stands condoned subject to payment of Rs.5,000/- as cost to the respondent.

[5] Learned counsel for the petitioner submitted that inspite of no concluded contract between the parties and not issuing insurance policy in favour of deceased, learned District forum committed error in allowing complaint and learned State Commission further committed error in dismissing appeal; hence, revision petition be allowed and impugned order be set aside. On the other hand, learned Counsel for the respondent submitted that order passed by learned State Commission is in accordance with law; hence, revision petition be dismissed.

[6] It is not disputed that complainant''s father late P.S. Patil filled proposal form for obtaining life insurance policy on 27.1.2007 for a sum of Rs.,20,00,000/-. It is also not disputed that deceased paid a premium of Rs.50,000/-.

[7] OP denied issuance of insurance policy and earlier Counsel for complainant submitted that he would be placing copy of insurance policy on record, but ultimately he submitted that he is not in a position to file copy of insurance policy meaning thereby, no life insurance policy was issued by OP in favour of deceased.

[8] Learned Counsel for the petitioner has drawn my attention towards 3 letters dated 29.1.2007 issued by OP to the deceased asking him for getting his medical examination. Learned Counsel for the respondent could not place any document to substantiate that requisite medical examinations were done and requisite reports were submitted by deceased to OP. Learned Counsel for the respondent has drawn my attention towards pleading in complaint that before receiving policy proposal Company doctor had examined deceased and certified that P.S. Patil''s life condition was normal, but no such report has been placed before me. Before submitting proposal form there is no question of medical examination by OP''s doctor and in such circumstances, this pleading is without proof and cannot be relied. Learned Counsel for the petitioner has also drawn my attention towards letter dated 9.3.2007 issued by OP by which again deceased was asked to get him examined by OP''s Cardiologist. Thus, it becomes clear that as necessary medical examination reports were not submitted by deceased, no insurance policy was issued by OP and it appears that in the meantime, deceased died on 15.3.2007 due to accident.

[9] Learned Counsel for the respondent submitted that as deceased died due to accident, non-examination by doctors regarding health has no significance for payment of claim. This argument is devoid of force because medical examination was pre-requisite condition for issuing policy of Rs.20,00,000/- and in the absence of medical examination, policy was not issued.

[10] This Commission in F.A. No.881 of 2013 Ajay Singh Bhambri Vs. Axis Bank Ltd. & Anr. observed as under: "The factual matrix of the case makes it very clear that although the proposal form was submitted and the premium was also paid to the Insurance Co., the policy in question had not been issued, when the death of the wife of the complainant took place. We have, therefore, no reasons to differ with the findings of the State Commission that no concluded contract had come into existence between the parties. The State Commission, in their well-reasoned order have relied upon the order of the Hon''ble Supreme Court in Life Insurance Corporation of India Vs. Raja Vasireddy Komalavalli Kamba & Ors., 1984 2 SCC 719, saying that merely filling any proposal for insurance and depositing first premium with the Life Insurance Corporation, do not create a binding contract between the parties. The State Commission has also placed reliance on the order passed by this Commission in ELSA Tony Phillip Vs. LIC of India & Ors., 2009 1 CPJ 18 (NC), in which similar view has been taken. From the above discussion, it is very clear that the State Commission have rightly concluded that there was no liability on the O.P. Insurance Company to pay the loan amount in question, to the O.P. No. 1 Bank on behalf of the complainants. The order passed by the State Commission, therefore, does not suffer from any illegality, irregularity or jurisdictional error and the same is upheld. The appeal is, therefore, ordered to be dismissed. There shall be no order as to costs."

[11] It was observed by me in (NC) Sh. Avtar Singh & Ors. Vs. SBI Life Insurance Co. Ltd., 2013 3 CPJ 608 as under: "Admittedly, neither acceptance of the proposal was communicated nor policy was issued to Tony Phillip by the respondent-Insurance Co. Considering the ratio of the said decision of Supreme Court, mere encashment of cheque, given towards first premium, is not enough to conclude that a contract had come into existence between the parties. Decision in LIC & Ors. Vs. Smt. Raksha Devi (R.P. No. 702 of 2003, decided on 20.10.2005) is of no help to the appellant. Impugned order, thus, does not suffer from any legal infirmity and the appeal deserves to be dismissed being without merit."

[12] Hon''ble Apex Court in Life Insurance Corporation of India Vs. Raja Vasireddy Komalavalli Kamba & Ors., 1984 2 SCC 719 observed that mere receipt and retention of premium until after the death of the applicant or the mere preparation of the policy document is not acceptance. In the case in hand neither medical examination required by OP was got done by the deceased, nor any acceptance of proposal was communicated, nor any policy document was prepared and issued. In the light of aforesaid discussion, in the absence of any concluded contract between the parties, no claim was payable and OP has not committed any deficiency in repudiating claim and refunding premium amount. Learned District Forum committed error in allowing complaint and learned State Commission further committed error in dismissing appeal and revision petition is to be allowed.

[13] Consequently, revision petition filed by the petitioner is allowed and order dated 31.3.2010 passed by the learned State Commission in Appeal No. 919 of 2009 The Underwriting Deptt. & Anr.Vs. Sri. Priyank Patil and order of District Forum dated 4.2.2009 in CC No. 162 of 2008 Sri Priyank Patil Vs. The Underwriting Department Bajaj Allianz Life Insurance Co. Ltd. & Anr. is set aside and complaint stands dismissed. Paties to bear their own costs.

[14] Petitioner is directed to refund amount of Rs.50,000/- received towards premium to respondent.