1.       The present Complaint is filed by the Complainant Nikhil Sharma through his father Sh. Ajay Sharma. The Complainant was the nominee in the Insurance Policy taken his deceased grandfather Sh. Gopal Dass. Opposite Party No.1 is Insurance Company. Opposite Party No.2 is a Bank engaged inter alia in providing financial facilities to its Customers.

2.       The case of the Complainant is that the representative of Opposite Party No.1 approached and visited the deceased grandfather of the Complainant at the behest of Sh. Jairam and Sh. Pardeep Kr. Shukla, the then Branch Manager and Asst. Manager respectively in Karnataka Bank Ltd., Varanasi, Opposite Party No.2. They assured the credibility of M/s Metlife India Insurance Company Limited, as highly reputed and esteemed Insurance Company in the field of Life Insurance. On their advice, Mr. Gopal Dass took three MetLife Life Insurance Policies on following terms:-

Opposite Party No.1 issued the aforesaid Life Insurance Policies only after conducting medical tests. Sh. Nikhil Sharma (Complainant herein), the minor grandson of the deceased was appointed as assignee/appointee/nominee. Sh. Gopal Dass expired on 25.10.2011. On 24.11.2011, the Complainant filed Insurance Claim for all three Policies with Opposite Party No.1 for an amount of Rs.1,35,00,000/- along with relevant documents. Opposite Party No. 1 repudiated the claim against all Policies, vide letter dated 05.03.2012, on the ground that the Life Assured had supressed the material fact relating to his income.  However, Opposite Party No.1 paid the following amount to the Complainant: -

The Complainant wrote several letters to Opposite Party No. 1 refuting and controverting the Demand Drafts, but Opposite Party No.1 did not reply. The Complainant also wrote letter to Opposite Party No. 2 to resolve the grievance with Opposite Party No.1 as the Policy was purchased through Opposite Party No. 2, but they also remained silent. Opposite Party No.1 did not adduce any evidence to justify the repudiation.

3.       Aggrieved by repudiation of the claim, the Complainant approached the Insurance Ombudsman by filing three separate Complaints. The Insurance Ombudsman rejected the Complaints, vide order dated 12.03.2014, on the ground of delay as well as pecuniary jurisdiction as the amount exceeded Rs.20 Lakhs in each Policy. Ombudsman also observed that the Complaints against the agent were not maintainable and the subject matter of forgery of signatures etc. did not fall within their jurisdiction. It was also observed that as the Complainant had also approached other Forum, the Complaint was not maintainable. Alleging deficiency in service and unfair trade practice on the part of the Opposite Parties, the Complainant filed this Complaint with the following prayer:-

“a) Direct all the Opposite Parties to pay the amount of Insurance Policy to the complainant i.e. Rs.1,35,00,000/- (One Crore Thirty Five Lacs) along with interest @ 18% per annum, till the date of realization of the above;

b) Award another sum of Rs.5,00,000/- (Five Lac) as and by way of compensation on account of unnecessary harassment and mental agony caused by the Opposite Parties in favour of the complainant and against the Opposite Parties above named by holding them jointly and severally liable for payment of the same;

c) Award costs of the proceedings/litigation expenses and counsel fees Rs.55,000/- (Fifty Five Thousand);

d) Pass any other further order (s), as this Hon’ble Commission may deem fit, proper, just and expedient in the interest of justice.”

4.       The Opposite Parties resisted the Complaint by filing separate replies. Opposite Party No.1 submitted that the Complainant had not approached this Commission with clean hands. The Complaint is liable to be dismissed on the ground of lack of pecuniary jurisdiction. The Complainant has combined the claim of three different Insurance Policies in order to invoke the pecuniary jurisdiction of this Commission. Eligibility of the Complainant to receive the amount under the Policies depends upon the contract based on utmost good faith and subject to terms and conditions of the Policy. The Policies were obtained by the insured by making false statements about his income. It was further wrong on the part of Life Assured to allege that he was illiterate and misled to believe everything as stated by the agent.

5.       Opposite Party No.2 stated that the Complaint qua Opposite Party No.2 was not maintainable. Opposite Party No.2 had acted as a corporate agent of Opposite Party No.1 and they were not responsible for any action or inaction of the Opposite Party No.1. Opposite Party No.2 had only introduced Mr. Gopal Dass to Opposite Party No.1 and on the request of Opposite Party No.1 forwarded the necessary documents including the ITR of the Complainant to Opposite Party No.1. Opposite Party No.2 had no involvement or dealings with the Complainant after issuance of the Policy.      

5.       Heard the Learned Counsels for the Parties and carefully perused the record. Learned Counsel for the Complainant submitted that Opposite Party No.2 had admitted that on the request of Opposite Party No.1 they had forwarded the necessary documents including the ITR of the Complainant to Opposite Party No.1. Opposite Party No.1 after verifying the documents had issued the Policies in question. It was submitted that according to Section 45 of Insurance Act, 1938, after expiry of two years Life Insurance Policy cannot be called in question. The proposal form was filled by the agent of Opposite Party No.1 Sh. Sandeep Rathore who himself had verified that he filled the form. Life Assured had paid the premiums regularly and well in time. Learned Counsel for the Complainant has relied on the judgment of Hon’ble Supreme Court and this Commission in United India Insurance Co. Ltd. & Anr. Vs. Samir Chandra Chaudhary III (2005) CPJ 2 (SC); LIC Unit No.2 & Anr. Vs. Rahul Singh II (2008) CPJ 219; Anand Kumar Kejriwal vs. LIC of India & Anr. II (2011) CPJ 249 (NC); LIC of India vs. Gurbaz Singh IV (2006) CPJ 379.

6.       Learned Counsel for Opposite Party No.1 submitted that the Complainant had not approached this Commission with clean hands. The Consumer Complaint is not maintainable for want of pecuniary jurisdiction. The Complainant had clubbed the amounts of three Insurance Policies and thereby bypassed the original jurisdiction of the State Commission and invoked the jurisdiction of this Commission. The deceased Life Assured obtained the Insurance Policies in total disregard of the doctrine of utmost good faith. He deliberately misrepresented his income and declared highly inflated income.

7.       Learned Counsel for Opposite Party No.2 submitted that the Complaint against Opposite Party No.2 was not maintainable. The Complainant was having bank account with Opposite Party No.2 but so far as the instant dispute is concerned, there is no relation of Consumer and the service provider between the Complainant and Opposite Party No.2 and the Complaint qua Opposite Party No.2 is liable to be dismissed. Moreover, Opposite Party No.2 was acting as a corporate agent of Opposite Party No.1. On the request of Opposite Party No.1, they forwarded the necessary documents including the ITR supplied by the Life Assured to Opposite Party No.1. Opposite Party No.2 has nothing to do with the insurance claim of the Complaint.

8.       Facts of the case are that at the behest of Opposite Party No.2, Opposite Party No.1 approached Late Sh. Gopal Dass for taking Insurance Policies. Late Sh. Gopal Das obtained three Insurance Policies from Opposite Party No.1. Complainant was the nominee in the said Policies. Sh. Gopal Dass expired on 25.10.2011. On 24.11.2011, the Complainant filed Insurance Claim for all three Policies with Opposite Party No.1 for an amount of Rs.1,35,00,000/-, along with all relevant documents. Opposite Party No. 1 repudiated the claim against all Policies, vide letter dated 05.03.2012, on the ground that the Life Assured had supressed the material fact relating to his income. However, Opposite Party No.1 allowed an amount of Rs.4,43,941, Rs.54,137/- and Rs.31,140/- respectively, which was not accepted by the Complainant.

9.       So far as the question of maintainability is concerned, it is relevant to mention that Opposite Party No.1 had repudiated all three claims of the Complainant vide common letter dated 05.03.2012, which reads as follows: -

 “We regret to bring to your kind attention that during the course of assessing the claim, we received the Income Tax Returns of Late Mr. Gopal Das for the assessment year 2008-2009, 2009-2010 which had income of Rs.2,29,113/- & Rs.3,81,189/- respectively. However, the income was shown as Rs.12,29,113/- & Rs.13,81,189/- respectively in the copies of ITR’s submitted to us at application stage. The risk cover was issued based on the income proofs submitted an application stage basis the inflated income, which was not reflecting the actual income of Late Mr. Gopal Dass.

We therefore regret to inform you that we are unable to admit liability for the above claim due to non-disclosure of material facts and have treated the said policy as Void ab-initio.”

10.     From the above, it is clear that all three claims were repudiated by common letter dated 05.03.2012. In the instant Complaint, the Complainant has challenged the repudiation letter dated 05.03.2012. It cannot be said that the Complainant had clubbed three claims. It is Opposite Party No.1 which had clubbed all the claims and repudiated the same, vide common letter dated 05.03.2012. The objection taken by Opposite Party No.1 that the Complaint is not maintainable for want of pecuniary jurisdiction is, therefore, rejected.

11.     On merit, the issue is whether Opposite Party No.1/Insurance Company can repudiate the claim “after expiry of more than two years” on the ground of suppression of material fact. The Insurance Policies commenced w.e.f. 14.05.2009, 19.11.2009 and 07.12.2009. The Insurance Claim was repudiated on 05.03.2012. Section 45 of the Insurance Act, 1938 states that:

“45. Policy not to be called in question on ground of mis-statement after two years.—No policy of life insurance effected before the commencement of this Act shall after the expiry of two years from the date of commencement of this Act and no policy of life insurance effected after the coming into force of this Act shall after the expiry of two years from the date on which it was effected, be called in question by an insurer on the ground that a statement made in the proposal for insurance or in any report of a medical officer, or referee, or friend of the insured, or in any other document leading to the issue of the policy, was inaccurate or false, unless the insurer shows that such statement was on a material matter or suppressed facts which it was material to disclose and that it was fraudulently made by the policy-holder and that the policy‑holder knew at the time of making it that the statement was false or that it suppressed facts which it was material to disclose:

Provided that nothing in this section shall prevent the insurer from calling for proof of age at any time if he is entitled to do so, and no policy shall be deemed to be called in question merely because the terms of the policy are adjusted on subsequent proof that the age of the life insured was incorrectly stated in the proposal.”

12.      Section 45 stipulates restrictions upon the Insurer calling into question a Life Insurance Policy after expiry of two years from the date on which it was affected. After two years have elapsed the Insurance Policy cannot be called into question on the ground that the statement made in the proposal form or in any other document leading to the issuance of the Policy was inaccurate or false, unless such a statement led to suppression of material fact. Beyond two years, the burden lies on the Insurer to establish the inaccuracy or falsity of a statement on a material matter or the suppression of material facts. Alongwith the Complaint, the Complainant has filed the copies of the ITR for the year assessment 2008-09 and 2009-10 showing the gross total income at Rs.2,29,143/- and Rs.3,81,189/- respectively. The Complainant alleged that Opposite Party No.2/Karnataka Bank Ltd. had forwarded the necessary documents including the ITR to the Insurance Company. Opposite Party No.2 in its reply has also admitted this fact that they have forwarded the necessary documents including the ITR of the Complainant to the Insurance Company. The copies of the ITR filed by the Complainant bear the seal as well as the signature on behalf of Karnataka Bank Ltd. Alongwith the reply, Opposite Party No.1 has also filed copies of the ITR for the same period as Annexure-1, alleged to be filed by the Complainant alongwith the proposal form. These copies do not bear either the signature or the seal of Opposite Party No.2/Karnataka Bank Ltd. Thus, the copies of the ITR filed by Opposite Party No.1 cannot be relied upon. Initially Policy No.20191448 was for Rs.30 lakhs, which was later revised by Opposite Party No.1 to Rs.35 lakhs, vide letter dated 14.04.2010. At the time of issuance of the Policy for Rs.30 lakhs in the year 2009, Opposite Party No.1 must have gone through the financial credentials of the Complainant. Similarly, at the time of revision of the Policy from Rs.30 lakhs to Rs.35 lakhs, Opposite Party No.1 must have gone through the financial credentials of the Complainant and then only would have issued the revised Policy. Opposite Party No.1 has also not filed copy of the proposal form to establish that the Life Assured had mentioned wrong income in any column of the form. Opposite Party No.1 has made bald allegation of fraud against the Life Assured in order to avoid the payment to the Complainant. Opposite Party No.1 cannot be allowed to escape from its liability. In M/s Safe Home Developers (supra) relied by the Learned Counsel for Opposite Party No.1, the question of forgery in about 250 cheques was involved. This case is, therefore, distinguishable on facts.  In Neetaben Mukund Shah (supra), the Life Assured suppressed the fact that he also possessed other Policies. In M/s Aviva Life Insurance Co. Ltd. (supra), the case of the Complainant was that the terms & conditions of the Policy were not explained to the Life Assured, who was an illiterate person. This case is also distinguishable on facts. In Reliance Life Insurance Co. Ltd. (supra), the proposer suppressed the material fact that he held a prior Insurance Policy and during the course of Court proceedings admitted this fact. Moreover, in that case the repudiation was within a period of two years from the commencement of the Policy. In the present case, the repudiation has been made after expiry of more than two years. The onus to prove that the Life Assured had filed wrong ITR was on Opposite Party No.1, which they failed to do. Opposite Party No.1 thus failed to discharge the onus of proof. On the other hand, Complainant established that the copies of the ITR for 2008-09 and 2009-10 filed by the Complainant bear the endorsement of Opposite Party No.2. Moreover, there is admission of Opposite Party No.2 in the written statement that they have forwarded necessary documents including the ITR to Opposite Party No.1.

14.     In the view of aforesaid discussions, we are of the view that the repudiation of Insurance claim by Opposite Party No.1 was not justified. Complaint is allowed and Opposite Party No.1 is directed to make payment of Rs.1.35 crores duly adjusting amounts paid, if any. Opposite Party No.1 shall also pay compensation in the form of 9% interest per annum on this amount to the Complainant from the date of repudiation of claim till the date of payment. Opposite Party No.1 shall comply the order within a period of two months from the date of receipt of the order. The order be complied within eight weeks.