Haryana

Karnal

CC/83/2021

Pulkit Sharma - Complainant(s)

Versus

Tata Capital Housing Finance Limited - Opp.Party(s)

R.K. Karma

13 Mar 2023

ORDER

BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION, KARNAL.

 

                                                        Complaint No. 83 of 2021

                                                        Date of instt.10.02.2021

                                                        Date of Decision:13.03.2023

 

Pulkit Sharma son of Shri Hem Raj, resident of house no.1456, sector-4 and 5, Housing Board Colony, Karnal.

                                               …….Complainant.

                                              Versus

 

1.     Tata Capital Housing Finance Limited, SCO 239, Part-1, Sector-12, Karnal through its Manager.

 

2.     Tata AIA Life Insurance, SCO 254, 1^st floor, above Indusind Bank, Part-1, Sector-12, Karnal through its Manager.

 

                                                                      …..Opposite Parties.

 

Complaint Under Section 35 of Consumer Protection Act, 2019.

 

Before   Sh. Jaswant Singh……President.       

      Sh. Vineet Kaushik…….Member

      Dr. Rekha Chaudhary……Member

          

 Argued by: Shri R.K. Kamra, counsel for the complainant.

                    Shri Umesh Lakhanpal, counsel for the OP no.1.

                    Shri Vikas Bakshi, counsel for the OP no.2.

 

                    (Jaswant Singh President)

ORDER:   

                

                The complainant has filed the present complaint Under Section 35 of Consumer Protection Act, 2019 against the opposite party (hereinafter referred to as ‘OP’) on the averments that mother of the complainant Smt. Pushpa Rani purchased a house bearing no.1456 LIG Sector-4 and 5, Housing Board Colony, Krnal measuring 26 sq. yard for a total sale consideration of Rs.6,60,000/-, vide registered sale deed no.9352/1 dated 04.12.2019. While purchasing the house, the mother of complainant applied for housing loan to the OP no.1. After due compliance, OP no.1 sanctioned the loan of Rs.6,00,000/-. The monthly installment of loan was fixed as Rs.7760/- per month. It is averred that at the time of sanction of loan, OP no.1 directed the mother of complainant to get a life insurance policy from the OP no.2 which is sister concern of OP no.1 to secure the loan amount in case of death of the borrower. The mother of complainant in compelling circumstances then also paid a sum of Rs.42692.40p for insurance policy. OPs issued the policy bearing no.GLPP000005 dated 29.11.2019 and at the time of issuing the policy, OPs told the complainant, in case of death of life assured, the loan amount will be recovered from the OP no.2. The loan was sanctioned on 29.11.2019 and the mother of complainant started paying the installment of loan regularly as per schedule. The borrower i.e mother of complainant expired on 26.07.2020 at Kalpana Chawla Government Medical College, Karnal. After the death of his mother, complainant contacted the OP no.1 and submitted the death certificate of his mother and requested for the adjustment of loan from the insurance company and to issue the clearance certificate and to release the documents of property. OP no.1 took the signature of the complainant on some forms and told the complainant that remaining amount of loan will be adjusted with the insured amount and his papers/documents of property will be released after adjustment of loan amount from the insurance company. On 05.11.2020, complainant received a notice from the OP no.1 through which complainant is directed to make the payment of installment of loan. On receipt of said notice, complainant contacted the OP no.1 and asked them to adjust the loan amount and to release the documents but official of OP no.1 gave no satisfactory reply and asked him to contact the OP no.2. The complainant contacted the official of OP no.2, who also postponed the matter on one pretext or the other. Then complainant sent a legal notice dated 09.01.2021 through his counsel with request to adjust the loan amount and to return the documents alongwith remaining amount of sum assured within 15 days from the receipt of notice. OP no.2 gave the reply to the said notice through, OP no.2 refused to admit the claim of the complainant on the ground that the insured was suffering from pre-existing illness. OPs never asked about any of the terms and conditions of the insurance policy but have received amount of premium of Rs.42,692/- on the pretext that it is mandatory for sanction of housing loan. In this way there is deficiency in service on the part of the OPs. Hence this complaint.

2.             On notice, OP no.1 appeared and filed its written version, raising preliminary objections with regard to maintainability; cause of action; locus standi; jurisdiction and concealment of true and material facts. On merits, it is pleaded that the main dispute is in between the complainant and the insurance company i.e. OP no.2. OP no.1 has no role in processing of insurance claim. OP no.1 has only given the financial assistance to purchase the home and has every right to recover the defaulted amount outstanding due towards the loan of complainant apart from availing legal remedies available as per law for recovery of outstanding amount. It is further pleaded that complainant is the co-borrower of OP no.1 and he alongwith borrower have availed the facility of loan against property from the OP no.1. OP no.1 denied that the OP no.1 has directed the complainant and his mother to get the life insurance policy from OP no.2. As a matter of fact, the complainant and his mother themselves applied for insurance from OP no.2 to secure the loan amount and provided the documents of the policy to OP no.1 for record. The claim of insurance has been applied to OP no.2 and OP no.1 has no role in processing the same. OP no.1 is only concerned with the loan and it is the liability of the complainant to repay the same whether himself or through settlement of claim. There is no deficiency in service on the part of the OP no.1. The other allegations made in the complaint have been denied and prayed for dismissal of the complaint qua OP no.1.

3.             OP no.2 filed its separate written version raising preliminary objections with regard to maintainability; cause of action; locus standi; jurisdiction and concealment of true and material facts. On merits, it is pleaded that the mother of the complainant i.e. Smt. Pushpa Rani had submitted to the OP no.2, a Member Enrollment Form dated 28.11.2019 for the purchase of “Tata AIA Life Insurance Group Loan Protect” under the Master Policy no.GLPP000005. The insured opted for a cover of Rs.6 lakhs on a reducing basis and also paid an advance initial single premium of Rs.42,692/-. It is further pleaded that at the time of Member Enrollment Form, the insured gave a declaration of good health. Based on the answers and declaration given by the insured, said Member Enrollment Form for issuance of insurance coverage was accepted on standard rate and consequently a “Certificate of Insurance” was issued bearing certificate no.1000005754 having coverage effective date of 19.11.2019 and coverage expiry date of 28.11.2039. After the issuance of insurance coverage, the certificate of insurance alongwith terms and condition and sum assured schedule was sent to the insured. It is further pleaded that complainant submitted a death claim intimation-cum-claimant’s statement dated 21.09.2020 informing the death of the insured to the OP. The cause of death was mentioned as Heart Attack. As being very early claim, the OP investigated the death claim. Upon procuring the documents of the insured, it came to the knowledge of OP that the insured was not keeping a good health and was admitted in Sanjiv Bansal Cygnus Hospital, Karnal on 04.05.2018 for Cardiomyopathy Dilated, Non Obstructive CAD, CAD/DM Type 2, HTN, Hypothyroidism and had undergone CAG. In the Member Enrollment Form dated 28.11.2019, the said history was concealed from the OP at the time of applying for the insurance coverage in question. The insured intentionally concealed the pre-existing medical condition and treatment taken in Sanjiv Bansal Cygnus Hospital, Karnal, prior to issuance of the insurance policy. By concealing the vital medical and health condition and treatment taken, insured has violated the basis principle of “Utmost Good Faith” and has obtained the insurance policy by keeping the OP in dark about the risks that he is transferring to the OP. Considering the concealment of vital medical and health condition and treatment taken prior to purchase of the insurance coverage, the claim of the complainant was repudiated, vide letter dated 25.11.2020. Further, the premium received thereunder was refunded. There is no deficiency in service and unfair trade practice on the part of the OPs. The other allegations made in the complaint have been denied and prayed for dismissal of the complaint.

3.             Parties then led their respective evidence.

4.             Learned counsel for complainant has tendered into evidence affidavit of complainant Ex.C1, copy of sale deed Ex.C1, copy of death certificate Ex.C2, copy of legal notice dated 09.01.2021 alongwith postal receipt Ex.C3 and Ex.C4, copy of legal notice dated 30.07.2021 Ex.C5, copy of reply of legal notice Ex.C6, copy of statement of account Ex.C7 and closed the evidence on 01.12.2021 by suffering separate statement.

5.             On the other hand, learned counsel for the OP no.1 has tendered into evidence affidavit of Maninder Pal Singh Ex.OP1/A and closed the evidence on 02.03.2022.

6.             Learned counsel for the OP no.2 has tendered into evidence affidavit of Shri Harsimran Singh, Senior Manager Legal Ex.OPW2/A, copy of authority letter Ex.OP1, copy of Member Enrollment Ex.OP2, copy of certificate of insurance Ex.OP3, copy of death claim intimation-cum-claimant’s statement Ex.OP4, copy of medical treatment record Ex.OP5, copy of repudiation letter dated 25.11.2020 Ex.OP6, copy of medical slip of KCGMC, Hospital, Karnal Ex.OP7 and closed the evidence on 05.09.2022 by suffering separate statement.

7.             We have heard the learned counsel for the parties and perused the case file carefully and have also gone through the evidence led by the parties.

8.             Learned counsel for complainant, while reiterating the contents of the complaint, has vehemently argued that the mother of complainant applied for housing loan to the OP no.1. OP no.1had  sanctioned the loan of Rs.6,00,000/-. The monthly installment of loan was fixed as Rs.7760/- per month. The mother of complainant purchased a life insurance policy from the OP no.2 to secure the loan amount. The loan was sanctioned on 29.11.2019 and the mother of complainant started paying the installment of loan regularly as per schedule. The mother of complainant expired on 26.07.2020 due to heart attack and after the death of his mother, complainant contacted the OP no.1 and submitted the death certificate of his mother and requested for the adjustment of loan from the insurance company and to issue the clearance certificate and to release the documents of property but OPs failed to do so and lastly prayed for allowing the complaint.

9.             Per contra, learned counsel for the OP no.1, while reiterating the contents of written version, has vehemently argued that the mother of complainant applied for insurance from OP no.2 to secure the loan amount. The claim of insurance has been applied to OP no.2 and OP no.1 has no role in processing the same. OP no.1 is only concerned with the loan and it is the liability of the complainant to repay the same and lastly prayed for dismissal of the complaint qua OP no.1.

10.           Learned counsel of OP no.2 while, reiterating the contents of written version, has vehemently argued that at the time of obtaining the policy in question, insured was not having a good health and was admitted in Sanjiv Bansal Cygnus Hospital, Karnal on 04.05.2018.  This fact had not been disclosed by the mother of complainant, at the time of obtaining the policy and has concealed the true and material facts with regard to her health and prayed for dismissal of the complaint.

11.           We have duly considered the rival contention of the parties.

12.           Admittedly, the complainant’s mother had purchased the policy in question from the OP no.2 through OP no.1 to secure the loan amount. It is also admitted that complainant’s mother was expired on 26.07.2020 due to heart attack.

13.           The claim of the complainant has been repudiated the by the OP no.2, vide  letter Ex.OP6 dated 25.11.2020 on the grounds which reproduced as under:-

“During the claim investigation, we have procured medical records and have established that the life assure has been suffering from Cardiomyopathy Dilated, Non Obstructive, coronary Artery Disease, Hypertension, Diabetes mellitus type 2 and Hypothyroidism disease since 5^th May, 2018, which is prior to the application for insurance. According to our records, such information was not disclosed in reply to the specific questions in the declaration of good health dated 28.11.2019 for the above policy. Had all this information been disclosed at the time of application, the above policy would not have been issued.

Despite making every attempt to consider the claim favorably, the facts regrettably demonstrate that this is not a valid claim on the above grounds. We, therefore, regret that we are unable to honour our claim and are rescinding the above policy from inception accordingly. Our liability shall be limited to Rs.36,180/- i.e. refund of premiums paid into the policy”.

14.           The claim of the complainant has been repudiated by the OP no.2 on the ground of concealment of true and material facts with regard to health of insured at the time of obtaining the insurance policy.

15.           The onus to prove that the mother of complainant was having pre-existing disease at the time of obtaining the policy was relied upon the OP no.2. To prove its case OP no.2 has placed on record, treatment record of Sanjiv Bansal Cygnus, Hospital, Karnal as Ex.OP5, wherein it is mentioned that Mrs. Pushpa i.e. mother of complainant (insured) was diagnosed for Cardiomyopathy Dilated, Non Obstructive CAD, CAD/DM Type 2, HTN, Hypothyroidism and had undergone CAG.  To rebut the abovesaid evidence complainant has not placed on record any cogent and convincing evidence that insured was not suffering from any disease prior to obtaining the insurance policy. Thus, it is proved on record that the mother of complainant was having pre-existing disease and had concealed the true and material facts regarding her health at the time of obtaining the insurance policy. In this regard, we are fortified with the observations of Hon’ble Supreme Court in case titled as Branch Manager, Bajaj Allianz Life Insurance Company Ltd. and others Vs. Dalbir Kaur in civil appeal no.3397 of 2020 decided on 09.10.2020 wherein Hon’ble Supreme Court held that a policy of insurance is governed by the principles of utmost good faith. The suppression of material facts by the insured/policyholder entitles the OP to repudiate the policy under section 45 of the Insurance Act. The said authority is fully applicable to the facts of the present case.

16.           Further, it is settled principle of insurance law that contract of insurance is a contract uberrima fides and utmost faith must be observed by the contracting parties. Every material fact must be disclosed, otherwise there is good ground for rescission of contract. If, there are misstatements or suppression of material facts, the policy can be called into question. In this regard reference may be made to the judgments of the Hon’ble Supreme Court in case titled Satwant Kaur Sandhu Versus New India Assurance Co. IV( 2009) CPJ 8 and Relinace Life Insurance Co. Ltd. Versus Rekhaben Nareshbhai Rathore decided on 24.04.2019 and judgment of Hon’ble National Commission in case Life Insurance Corporation of India and another Versus Bimla Devi Revision Petition no.3806 of 2009 decided on 12.8.2015 and Sunita Rani Versus PNB Metlife India Insurance Company Limited in appeal no.1252/2015 dcided on 21.04.2017.

17.           In the present case the mother of complainant has concealed the true and material facts with regard to her health at the time of obtaining the policy in question. Hence, we are of the considered view that OP no.2 has rightly repudiated the claim of the complainant and there is no deficiency in service on the part of the OP, while repudiating the claim of the complainant.

18.           Thus, present complaint is devoid of any merits and same deserves to be dismissed and the same is hereby dismissed. No order as to costs. The parties concerned be communicated of the order accordingly and the file be consigned to the record room after due compliance.

Announced

Dated:13.03.2023

                                                                       

                                                                  President,

                                                       District Consumer Disputes

                                                       Redressal Commission, Karnal.

       

(Vineet Kaushik)             (Dr. Rekha Chaudhary)

                     Member                          Member