BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION.
KAMRUP
C.C.No. 76/2015
Present: I) Shri A.F.A.Bora, M.Sc.,L.L.B.,A.J.S(Rtd.) -President
II) Smti Archana Deka Lahkar,B.Sc.,L.L.B. -Member
III) Shri Tutumoni Deva Goswami, B.A.L.L.B. - Member
Smti Lalita Sahu - Complainant
-vs-
1) The Branch Manager -Opposite parties
LICI, Goalpara Branch office,
Agia Road, P.O. Boladmari,
Dist. Goalpara
2) The Chairman,
LICI Central Office, Mumbai
3) The Zonal Manager, LICI,
Kolkata
4) The Sr.Divisional Manager, LICI,
Bongaigaon
Appearance
For the complainant Sri S. Sauhan Learned advocate .
For the Opp.party No. 1 to 4 Sri Sanjib Dey Learned advocate .
Date of filing written argument :- 27.4.21, 16.8.21
Date of oral argument :- 18.2.22
Date of judgment: - 7.3.22
JUDGMENT
Fact of the case
- This is a complaint filed by one Smti Lalita Sahu against (i) The Branch Manager, LICI, Goalpara Branch office, Agia Road, P.O. Boladmari, Dist. Goalpara (ii) The Chairman, LICI Central Office, Mumbai (iii) The Zonal Manager, LICI, Kolkata (iv) The Sr.Divisional Manager, LICI, Bongaigaon. The case was admitted on 1.10.15 . Notices were upon the op.parties .
- The opp.parties contested the proceeding and filed their written statement . The complainant filed evidence on affidavit and thereafter on 2.8.16 an order was passed for exparte hearing as the opp.parties were absent without step to cross examined the complainant’s witness and thereafter on 3.3.17 complainant filed written argument .
- At this stage opp.party preferred a revision and Hon’ble State Commission on 26.5.17 set aside the order of this forum dtd. 2.8.16, allowing the opp.parties to cross examine the complainant s witness. Accordingly complainant was cross examine and the case has been fixed for filing evidence by the op.parties . On 18.7.18 opp.parties preferred a Revision petition before the Hon’ble State Commission and the op.parties are allowed to adduce additional evidence. Accordingly, after filing additional evidence by the opp.parties, they were cross examined and the case has been fixed for filing written argument. The parties have duly placed their argument and case has been fixed for delivery of judgment .
- Fact of the case in brief is that the complainant is a student staying at Rehabari , Guwahati. Her father and mother expired and she is staying with her younger sister. Late Chandrawati Sahu who purchased a insurance policy vide policy no. 488746645 dtd. 28.3.2007 of sum assured Rs.10,00,000/- only. In the said policy the complainant being the daughter was the nominee of Late Chandrawati Sahu. The father of the complainant died on 5.4.2007 and prior to death of her father the policy was commenced w.e.f. 28.3.2007.Complainant’s mother Chandrawati Sahu expired on 24.8.2012 and being the nominee of her policy she submitted death claims on 20.10.2012. After receipt of the letter of the complainant opp.party No. 4 repudiated the claim vide letter dtd. 25.6.13. In the said letter it has been stated that as per Final Report (U/S 173 C.R.P.C.) Honb’le Special Judge , C.B.I. Assam that the Lt.P.K.Sahu (husband of the deceased life assured Lt. Chandrawati Sahu) expired on 15.1.2007.
- The complainant states that the case has not been decided by the Special Judge C.B.I. and it has also not been proved that the husband of the deceased life assured , Lt. Chandrawati Sahu expired on 15.1.2007. The opp.party No. 4 wrongly decided to repudiate the death claim on some misconception. The complainant stated that op.party cannot repudiate the claim as the complainant’s mother was not involved with the above mentioned C.B.I. case . Complainant again states that since the policy was in force and premium was paid, the nominee has the right to receive the policy amount. The complainant having no other alternative filed her complaint before the office of insurance Ombudsmen, Guwahati and in the judgment the complaint is disposed of without allowing any benefit to the complainant . The complainant states that there is a deficiency on the part of the opp.parties and the complainant has been suffering both financially and mentally from 20.10.2012 till filing of the case and she prayed to direct the opp.parties to pay her Rs.5,36,000/- for daily loss, Rs.500/- per day till realization of the compensation, Rs.50,000/- for mental harassment, Rs.10,00,000/- for sum assured and other benefit as well as future compensation .
- The opp.party no. 1 to 4 contested their proceeding and filed written statement . In their w.s. they stated that complainant’s father i.e. husband of the deceased life Assured (DLA) was died on 15.1.2007 and not on 5.4.2007. It may be mentioned here that chandrawati Sahu, w/o late Pradip Kr.Sahu proposed for a life Insurance policy of Rs.10,00,000/-vide her proposal No. 8872 dtd.31.3.2007. In the said proposal she together with other material facts had declared. On the basis of her declaration , the proposal was accepted by the corporation on 31.3.2007 vide policy bearing No. 488746645. The proposal form is the basis of Insurance contract and the proposer is required to furnish the every detail fact regarding her health/habit/marital status etc. to enable the insurer to assess the risk properly. Subsequently, the life Assured died on 24.8.2012. The claim lodged on 12.10.2012 and on receipt of the claim, the opp.party investigated the claim and observed that there was gross suppression of material facts regarding marital status of the deceased life assured.
- The opp.party No. 1 to 4 further states that the Deceased Life Assured (DLA) declared her husband as alive at the time of proposal i.e. on 30.3.2007 , but the evidence show that her husband had already died before submission of the proposal . In view of the fact stated above , the claim under the policy was repudiated on 25.6.2013 on the ground of suppression of material fact by the DLA at the time of proposal. The opp.party stated that the proposal would have not been accepted had she declared her actual marital status at the time of proposal. Subsequently , the claimant approached zonal office for reconsideration of the claim but after through study of each and every fact, the zonal office has upheld authority’s decision regarding repudiation of the claim vide their letter dtd. 22.3.2014. The claimant appealed to Insurance Ombudsman and the said authority also upheld the decision taken by the LICI vide their letter. The opp.party further states that had the proposer viz chandrawati Sahu declared her actual marital status at the time of proposal, the proposal would have not been accepted by LIC. Hence the question of claim does not arise. The Life Insurance Corporation of India (LICI ) as a custodian of people’s money has rightly repudiated the claim of the claimant to protect the interest of the genuine policy holders. In view of the fact opp.party pray before this Hon’ble forum to dismiss the instant claim petition and to impose cost upon the claimant for the interest of justice.
- On the basis of pleading of the partis we decide to confine our discussion on the following points only.
Points for decision
- Whether the suppression of material fact by the insured at the timeof submitting the proposal form is a ground for repudiating the claim ?
- Whether section 45 of the Insurance Act, 1938 is applicable and if so whether suppression of any fact in the present case is a ground to refuse the claim ?
- Whether complainant is entitled for assured amount as a nominee of the life assured ?
Reasons for decision
9) We have considered the argument placed on record by the parties . It has been stated that the complainant ‘s mother Smti Chandrawati Sahu was opened an endowment policy vide proposal No. 8872 dtd. 31.3.2007 and policy No. 488746645 having Sum Assured of Rupees ten lakhs. Smti Chandrawati Sahu had expired on 28.7.2012 and the complainant’s claim that her mother continued her policy for 06 years 02 months 27 days without any default and total premium claims of Rs. 3,05,952/- . On 19.10.2012 the complainant submitted her claim as nominee of Lt. Chandrawati Sahu (Life Assured) , but on 25.6.2013 the LICI repudiated her claim on the ground that the marital status was suppressed by the Life Assured at the time of submitting the proposal form. It is submitted that as per Final Report submitted by CBI , husband of the life assured had expired on 15.1.2007 which was suppressed .
10) Being aggrieved the complainant on 19.7.2013 preferred appeal before the Zonal Manager LICI , Kolkata and same was rejected. Thereafter the complainant preferred a complaint before the Ombudsman but same was rejected. Now, we need to decide firstly whether the suppression of material fact by the insured at the time of submitting the proposal form is a ground for repudiating the claim ?
11) To decide the aforesaid issue we like to place on record the provision of Section 45 of the Insurance Act,1938 which read as under ,
“45. Policy not to be called in question on ground of mis-statement after three years - (1) No policy of life insurance shall be called in question on any ground whatsoever after the expiry of three years from the date of the policy; i.e. from the date of issuance of the policy or date of commencement of risk or the date of revival of the policy or the date of the rider to the policy whichever is later.
(2) A policy of life insurance may be called in question at any time within three years from the date of issuance of the policy or the date of commencement of risk or the date of revival of the policy or the date of the rider to the policy, whichever is later, on the ground of fraud.
Provided that the insurer shall have to communicate in writing to the insured or the legal representatives or nominees or assignees of the insured the grounds and materials on which such decision is based.”
12) It appears from the evidence on record that Lt. Chandrawati Sahu purchased the insurance policy vide policy No. 488746645 dtd. 28.3.2007 of Sum Assured of Rs.10,00,000/- . Chandrawati Sahu who expired on 24.8.2012 the complainant being the nominee of her policy submitted death claims on 20.10.2012 . On 25.6.2013 her claim was repudiated by the opp.party. As such, as per Insurance Act, 1938 the op.party could have raised the objection if any in respect of suppression of material fact within 3 years from 28.3.2007 which has not been done by the opp.party in accordance with the provision. According to our observation, the repudiation on the ground of suppression of material fact is bad for the reason of not-communicating the same to the insured within three years during her life time. Hence the ground stated for repudiation is found not acceptable.
13) Whether section 45 of the Insurance Act, 1938 is applicable and if so whether suppression of any fact in the present case is a ground to refuse the claim ? Issue No. (I) has already decided and this issue is also regarding the question of fact and law and we propose to discuss the same herein below.
14) Here we have considered the evidence adduced by the opp.party in support of the fact that death of the husband of the complainant was 15.1.2007 . The opp.party stated that claim lodged by the claimant on 12.10.2012 and on receipt of the said claim, they investigated the claim and observed that there was gross suppression of material fact regarding marital status of the deceased life assured. It is also stated in the evidence by the opp.party that deceased life assured was declared that her husband was live at the time submission of the proposal i.e. 30.3.2007. But as per the Cadaver Report the husband of the deceased life i.e. Pradip Kr.Sahu died on 15.1.2007 . Again opp.party No. 1 Mr.Mukut Das in his cross examination stated that their company did not get any investigation done immediately within two years after commencement of the policy.
15) We have gone through the Cadavar Report of Dibrugarh Medical College Hospital dtd. 15.1.2007 and also gone through the departmental enquiry report dtd. 5.6.2009 which has clearly established the fact that husband of the insured died on 15.1.2007. The other documents submitted by the opp.party in respect of a CBI case is not directly related to the present context for the claim made by a nominee of a deceased wife of one Lt. Pradip Kr.Sahu. As such we do not considered those facts as relevant for determining the issue in our present case in hand. The Policy holder while submitting the documents and the proposal forms those were definitely verified and corrected by the official of the insurance company and if there was any suppression of fact definitely they could have correct the same within three years from the date of accepting the proposal which has not been done by the op.party as per law. In our considered view raising such issue at a later stage is not acceptable . Hence, without going further discussion issue No. (II) is decided in negative.
16) The last and final issue in the dispute is whether the complainant is entitled for assured amount as a nominee of the life assured. To decide the above issue we have made curious look on the policy paper Ext.2 where the name of the complainant is there as a nominee u/s 39 of the Insurance Act,1938 who is the daughter of Lt. Chandrawati Sahu. This fact is undisputed and nowhere raised any objection by the opp.party in the matter . Section 39(I) of the Insurance Act read as under,
“The holder of a policy of a life insurance on his own life may, when effecting the policy or at any time before the policy matures for payment, nominate the person or persons to whom the money secured by the policy shall be paid in the event of his death.”
17) We have carefully look into the proviso of Section 39 of Insurance Act and the suppression of any fact which is not material for determining the insured value is not to be considered for repudiation of the claim at the time of claim made by the nominee after more than five years of the acceptance of proposal of the insured.
18) Further another point raised by the complainant that written statement is time barred cannot be accepted at the belated stage as the written statement was filed by the opp.party on 27.1.2016 and complainant was directed to submit evidence . As per record the complainant have never raised any question about the filing of written statement after a long period allegedly barred by provision of section 13(1) (a) of C.P.Act.1986 . As this issue has not been raised during pendency of the trial we do not like to make any comment further . We have respectfully accepted the proposition of law decided in the case reported on (2002) 6 Supreme court cases 635 which has been relied by the complainant .
19) In view of the aforesaid discussion we decided this issue in favour of the complainant and in our opinion the repudiation of the claim by the opp.party is not correct and hence complainant is found entitled for her claim over the insured amount of policy No. 488746645 dtd. 28.3.2007 of Rs. 10,00,000/- only sum assured on the death of the mother of the complainant Smti Chandrawati Sahu.
ORDER
It is directed that opp.party will have to pay to the complainant the total amount of sum assured of Rs.10,00,000/-(Rupees ten lakhs)only for the policy no. 488746645 . The opp.party have to pay the said amount with interest @ 5% from the date of repudiation i.e. 25.6.13 till payment. The opp.party have also to pay the compensation of Rs.20,000/- (Rupees twenty thousand)only for harassment and mental agony and along with cost of the proceeding amounting to Rs.10,000/- (Rupees ten thousand)only . The decretal amount have to be paid within 45 days from the date of judgment till realization failing which an interest @ 12% per annum to be paid by the op.party to the complainant on the entire decretal amount till realization.
Given under our hand and seal of the District Commission, Kamrup, this the 7th day of March /2022.
( Shri A.F.A.Bora )
President
District Consumer Commission, Kamrup.
( Smti Archana Deka Lahkar )
Member
District Consumer Commission, Kamrup
( Shri Tutumoni Deva Goswami )
Member
District Consumer Commission, Kamrup.
Dictated and corrected by me
( Shri A.F.A.Bora )
President,
District Consumer Commission, Kamrup.
Typed by me
( Smt Juna Borah )
Stenographer,
District Consumer Commission, Kamrup.
