FA 894  2011  against CC 83/2009, Dist. Forum,   Nizamabad

Between:

1)  Bajaj Allianz Life Insurance Company Ltd.

Rep. by its   Manger

Kavitha Complex  Nizamabad

2)  Bajaj Allianz Life Insurance Company Ltd.

Rep. by its Claims Manager

Regd. & Head Office

Yerrawada, Pune.                                        ***                           Appellants/

                                                                                                  Opposite Parties

                                                                   And

1)  Kasthuri Prabhavathi

W/o. Yadagiri

Beedi Roller

H.No. 5-6-60/5-1

NGO Colony, Kamareddy

Nizamabad.

2)    Kavitha

W/o. Late Nagesh

H.No. 5-6-60/5-1

NGO Colony, Kamareddy

Nizamabad.                                                 ***                         Respondents/

                                                                                                Complainants

Counsel for the Appellant:                          M/s.   G. Anand Kumar

Counsel for the Respondents:                     M/s. Yellanand Gupta (R1)

CORAM:

HON’BLE SRI JUSTICE D.APPA RAO, PRESIDENT.

      SMT. M. SHREESHA, MEMBER

   &

                                     S. BHUJANGA RAO, MEMBER

TUESDAY,  SIXTH DAY OF NOVEMBER TWO THOUSAND TWELVE

ORAL ORDER:  (Per Hon’ble Sri Justice D. Appa Rao, President)

***

1)                 This is an appeal preferred by  the opposite party   insurance company against the order of the Dist. Forum  directing  it to pay Rs. 3 lakhs  with interest @ 9% p.a., from 22.8.2008 the date of repudiation  together with costs  of Rs. 1,000/-.

2)                 The case of the complainant in brief is that  complainant No. 1 is the mother and complainant No. 2  is the wife of late Nagesh.  During his life time he had taken a policy for a sum of Rs. 3 lakhs with accident benefit covering the period between 17.5.2007 and 16.5.2008.  Complainant No. 1 was shown as nominee.  While so, Nagesh died on 1.5.2008 due to cardiac arrest.   When they claimed the amount the insurance company repudiated by its letter    He suppressed Gardner’s syndrome with which he had suffered for five years.    Assailing the repudiation they filed the complaint claiming the amount covered under the policy with interest from the date of death till the date of realization together with compensation and costs. 

3)                The appellant insurance company resisted the case.   While admitting issuance of policy, however, alleged that the deceased at the time when he took the policy suppressed his ailments.    He underwent colectomy surgery for multiple polyps prior to taking of the policy, and that he suppressed the said fact and was under medical treatment.   Since the deceased mentioned that he was not an  nor treated for any other ailments  policy was  issued.    After his death complainant No. 2 gave written statement that her husband used to take alcohol regularly and became a chronic patient.  He was treated in Yashoda Hospital, Malakpet,   Two major operations were conducted.  Another policy was taken with  Insurance Company and the said fact was also suppressed.   Since the insured died within two years,  by virtue of Section 45 of the Insurance Act, the claim being made within two years, on enquiry  having found that he suppressed the material facts about his health and other ailments,  the claim was repudiated, and the said fact was intimated.   There was no deficiency in service on its part and therefore prayed for dismissal of the complaint with costs. 

4)                 The complainants in proof of their case filed the affidavit evidence of complainant No. 1 and got Exs. A1 to A4 marked while the insurance company filed the affidavit evidence of its Asst. Manager and got Exs. B1 to B7 marked.

5)                The Dist. Forum after considering the evidence placed on record opined that   mere causal statements in the case sheet without formal proof by way of affidavit of the concerned  of Yashoda Hospital cannot be taken as evidence, and consequently allowed the complaint directing the insurance company to pay Rs. 3, 00,000/- covered under the policy   with interest @ 9% p.a., from the date of repudiation to complainant No. 1 she being the nominee together with costs. 

6)                Aggrieved by the said order, the insurance company preferred the appeal contending that the Dist. Forum did not appreciate either facts or law in correct perspective.   It did not consider that very wife of the deceased had given a statement about his health condition and the treatment underwent for earlier ailments and the treatment underwent by  husband at Yashoda Hospital, Malakpet, Hyderabad.    fact was never denied.    It ought to have considered the declaration given by him is contrary to the facts mentioned in the proposal form.   The complainant did not dispute the case sheet filed by them.   When the very proposer suppressed  the material facts  which were within his knowledge  it is not for the proposer to determine whether the  information  sought for is  material for the purpose of policy or not.    The Dist. Forum did not consider the decisions of the Hon’ble Supreme Court in regard to suppression of material facts within the knowledge of the proposer were not revealed, and therefore prayed that the appeal be allowed by dismissing the complaint. 

7)                The point that arises for consideration is whether the order of the Dist. Forum is vitiated by mis-appreciation of fact or law?

8)                 It is an undisputed fact that complainant No. 1 is the mother and complainant No. 2 is the wife of deceased Nagesh who died on 1.5.2008.  It is also not in dispute that basing on the proposal form submitted by him under Ex. B3 and  he did not disclose any ailment with which   he suffered  the  policy was issued under Ex. B1 for a sum of Rs. 3 lakhs covering the period from 17.5.2007 to 16.5.2008.    The complainant enclosing a copy of the policy Ex. A1 together with death certificate Exs. A2 & A3 made claim for payment of the amount covered under the policy.   Since the claim was within two years of the policy and by virtue of Section 45 of the Insurance Act, an investigator was appointed.   He enquired into the death and examined complainant No. 2 who said to have revealed that the deceased had taken treatment in Yashoda Hospital, Malakpet Hyderabad for various ailments, and while taking treatment he died in the hospital.    While communicating his investigation to the insurance company he enclosed various documents including medical record maintained by Yashoda Hospital, Malakpet,     He also obtained death summary prepared by Dr. Ravi Shankar and  Dr. G. R. Srinivasa Rao,  Consultant Gastroenterologists.    Importantly, when the insurance company had  categorically mentioned  in its counter  affidavit  that on the death of the deceased  the investigator had examined  complainant No. 2, and basing on her statement, investigation was made, obtained medical record from Yashoda Hospital, Malakpet, Hyderabad where the deceased  had underwent treatment  and ultimately leading to his death,   the complainant stated at para-4 of  her chief affidavit “I state that the ground shown by the opposite parties herein in repudiating the claim is false and incorrect.   The policy holder never suffered with any ailment of Gardner’s Syndrome as alleged by the opposite parties.  The cause of death of the policy holder and the ailment alleged to have suffered has no nexus with each other.   Just to evade the payment of the sum assured and accidental benefit, the opposite parties have repudiated the claim on flimsy grounds.” 

9)                 The affidavit of complainant No. 2 was not filed in order to repudiate the statement Ex. B7 recorded by the surveyor.    It is not as though the complainant had denied  proposer undergoing treatment in Yashoda Hospital, Malakpet, Hyderabad.   What all stated was that there was no nexus between the ailment and his death.  The Dist. Forum while directing the insurance company to pay the amount covered under the  dismissed the same against complainant No. 2 holding that complainant No. 1 was only entitled to the amount she being nominee. 

10)               The learned counsel for the insurance company contended that the investigator who was appointed not only collected the case sheet but also ration card and salary certificate and other evidence to show that at the instance of complainant No. 2 all this material was unearthed and finally case sheet discloses that the deceased had suffered from ‘Gardner’s syndrome, subtotal colectomy, SAIO, pseudo obstruction, APD, renal calculi and small left inguinal hernia etc.    We repeat that complainant No. 2 did not file any affidavit stating that she did not give such a statement nor the case sheet does not pertain to the insured.

11)               In the first instance it may be stated that contract of insurance being based on principle of utmost good faith,   any contract of insurance procured by suppressing material facts is Void-ab-initio. 

12)               The learned counsel for the complainant contended that assuming without admitting that the deceased had suffered from some ailment, however, there was no nexus between the material facts suppressed and the cause of death.    It may be stated herein that the case sheet discloses that the deceased was suffering from illness not only at the time when he submitted the proposal but also at the time when he died.    A perusal of record shows that  while the deceased had declared that he  had disclosed  all material facts  including his health  condition by  stating ‘No’  for all  the  questions  mentioned  at Sl. No. 14.   

 It may be stated that the deceased had suppressed   the above said ailments.   The medical record discloses that  he had suffered  from ‘Gardner’s  syndrome, subtotal  colectomy, SAIO, pseudo obstruction, APD, renal calculi and small left  inguinal  hernia etc.    He also underwent two major operations. 

13)               The Dist. Forum merely on the ground that the affidavits of the doctors who treated the patient were not filed did not rely on the medical record   filed in this regard.    It may be stated herein  Hon’ble Supreme Court in Satwant Kaur Sandhu Vs.      

14)               In Dinesh Bhai Chandarana Vs.  LIC Of India  in F.A. 242 of 2006 the National Commission held that  when an information in a specific  aspect is asked for in the proposal form, an assured is under solemn obligation  to make a true and full disclosure of the information on the subject which is  within his knowledge.  It is not for the proposer to determine whether the information sought for is material for the purpose of the policy or not. 

15)               There is no quarrel as to the   that the insurance company had to prove that there was fraudulent suppression   of  material facts  vide  Modern Insulators Ltd. Vs. Oriental Insurance Company reported in  AIR 2000 SC 1014. 

16)               Coming to the facts  when the insurance company had categorically mentioned  in its affidavit evidence  that the deceased had suffered from several ailments and had underwent  two major operations in Yashoda Hospital, Malakpet, Hyderabad and said record was filed basing on the information furnished by  his wife complainant No. 2,  and when the said fact was not disputed, it  cannot be said that the insurance company had to prove by filing the  affidavits of the doctors  to state that they treated the deceased.   Despite the fact  the insurance company had pleaded in detail

and filed medical record maintained by Yashoda Hospital to substantiate the fact, neither of the complainants had ever denied by mentioning that they do not relate to the deceased.   When the deceased had suppressed his ailment as well as treatment in the proposal form Ex. B3 whether there was nexus or no nexus with the  it being material fact, the insurance company was undoubtedly entitled to repudiate the claim.   Even otherwise the record shows that he succumbed to ailments mentioned in Ex. B7.   Therefore, it cannot be said that there was no nexus between the ailments and death.   The Dist. Forum did not appreciate the facts in correct perspective.  We are of the opinion that the proposer/deceased had suppressed material facts of his health condition, and therefore complainants were not entitled to any amount.

17)               In the result the appeal is allowed setting aside the order of the Dist. Forum.  Consequently the complaint is dismissed.   

1)      _______________________________

PRESIDENT                 

2)      ________________________________

 MEMBER

3)      ________________________________

 MEMBER

                                                                                      06/11/2012

*pnr

UP LOAD – O.K.