Andhra Pradesh

Chittoor-II at triputi

CC/39/2018

N.Vijaya, W/o Late N.Bujji - Complainant(s)

Versus

Andhra Bank, Chandragiri Branch, Rep. by its Branch Manager - Opp.Party(s)

A.Sudarsana Babu

25 Jan 2019

ORDER

Filing Date: 14.05.2018

Order Date:25.01.2019

 

 

 

BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM-II,

CHITTOOR AT TIRUPATI

 

 

      PRESENT: Sri.T.Anand, President (FAC)

               Smt. T.Anitha, Member

 

 

 

FRIDAY THE TWENTY FIFTH DAY OF JANUARY, TWO THOUSAND AND NINTEEN

 

 

 

C.C.No.39/2018

 

 

Between

 

 

N.Vijaya,

W/o. late. N.Bujji,

Hindu, aged about 49 years,

D.No.3-66, Mungilipattu village and post,

Chandragiri Mandal,

Chittoor District.                                                                                          … Complainant.

 

And

 

 

1.         Andhra Bank,

            Chandragiri Branch,

            Rep. by its Branch Manager,

            Chandragiri Town and Mandal,

            Chittoor District.

 

2.         M/s. India First Life Insurance Co. Ltd.,

            Rep. by its Authorised Signatory,

            D.No.301, B-Wing, The Qube, Infinity Park,

            Dindoshi – Film City Road,           

            Malad (East),

            Mumbai – 400 097.                                                                   …  Opposite parties.

 

 

 

 

            This complaint coming on before us for final hearing on 04.01.19 and upon perusing the complaint and other relevant material papers on record and on hearing Sri.A.Sudarsan Babu, counsel for complainant, and Sri.S.M.Jhan, counsel for opposite party No.2, and opposite party No.1 remained exparte, and having stood over till this day for consideration, this Forum makes the following:-

ORDER

DELIVERED BY SRI. T.ANAND, PRESIDENT (FAC)

ON BEHALF OF THE BENCH

           

            This complaint is filed under Section –12(1) of C.P.Act 1986, seeking direction to the opposite party No.2, to clear the existing debt with opposite party No.1 by paying Rs.13,41,680.90ps. as on the date of 07.04.2018 and also further dues towards debt, directing the opposite parties to pay Rs.37,000/- towards loan amount paid by co-applicants, and to pay Rs.1,00,000/- towards compensation for undergoing mental agony due to deficiency in service on the part of opposite parties and to pay costs of the litigation.

            2.  The complaint averments are as follows:- Complainant is the wife of deceased life assured (hereinafter called DLA) N.Bujji. N.Bhanu Chandar and N.Thulasiram are the sons of complainant and DLA. During the life of DLA, he obtained house loan from opposite party No.1, for the purpose of construction of house, and for that their sons stood as sureties. Opposite party No.1 sanctioned Rs.12,00,000/- towards house loan on 07.02.2016 vide letter of sanction. At the time of sanctioning loan, opposite parties 1 and 2 gave an impression that there is tie-up between them and that opposite party No.2 gave assurance with regard to the risk covered under the plan ‘India First Group Credit Life Plan’. The DLA joined the said plan on their assurance by submitting member form on 22.03.2016. The consent-cum-authorization form and simple declaration of good health was also filled by the opposite party No.1 bank officials, as they are illiterates and the DLA affixed signature in the duly filled forms. Opposite party No.2 issued certificate of insurance with cover commencement date as 22.03.2016 and cover end date as 21.03.2040 for Rs.12,00,000/- i.e. loan amount borrowed from opposite party No.1. The premium amount is fixed at Rs.1,20,806.40 ps. Complainant is the nominee to the said insurance policy. The DLA died on 23.11.2017 due to cardiac arrest. As on the date of death of DLA 18 EMIs were paid at the rate of Rs.12,000/- per month. The complainant submitted request letter dt:04.12.2017 along with relevant forms like claim intimation form. Having received the same, opposite party No.2 gave reply dt:09.12.2017 by acknowledging the death claim and further intimated that the claim request is under process. As there was no response from opposite party No.2 and pressure mounted from opposite party No.1 to pay the installments, an amount of Rs.25,000/- was paid after the death of DLA. Thereafter, complainant caused legal notice dt:27.03.2018, and having acknowledged the same opposite party No.2 caused reply dt:18.04.2018 stating that claim has been repudiated as the DLA suppressed material facts pertaining to his decease. Opposite party No.2 issued a letter dt:07.02.2018 to the complainant intimating about repudiation of her claim for non-disclosure of material information at the time of making proposal and further stated that they would refund the premium collected on the policy. It is stated that DLA is a regular customer to opposite party No.1. The officials of opposite party No.1 have filled the loan application form, membership form and consent-cum-authorization form and also simple declaration of good health. Since the DLA is illiterate, he is merely fixed his signatures on the concerned forms. There is no question of concealment of material information by the DLA. After the death of DLA Rs.37,000/- was paid to opposite party No.1, as opposite party No.1 insisted for payment of installments towards loan or else the loan may become N.P.A. As on the date of 07.04.2018 outstanding balance was Rs.13,41,685.90 ps., and the said amount has to be paid by opposite party No.2, as the life risk of DLA is covered under the above said policy. The repudiation of claim by opposite party No.2, is not justified and the same amounts to deficiency in service on their part. Opposite party No.2 is liable to pay the claim amount to opposite party No.1 and discharge the liability of co-applicants. Hence the complaint.

            3.  Opposite party No.1, remained exparte.

            4.  Opposite party No.2 filed the written version contending as follows – At the outset complaint averments are denied. Opposite party No.2 is a company duly incorporated under the provisions of Companies Act 1956. It is primarily carrying on insurance business as per Insurance Regulatory and Development Authority of India (IRDAI). It is stated that complaint averments are false and the complainant with malafide intention by abusing process of law filed this complaint. As per the medical record of DLA procured during investigation, DLA was having past medical history and intentionally he had not disclosed the same at the time of filing the policy. The complainant therefore has not approached this Forum with clean hands, since he suppressed the material facts before this Forum. In the written version, the following citations are referred – (i) SC 2776 (2002)  between Satwant Kaur Sandhu vs. New India Assurance Company Ltd., (ii) III (2006) CPJ 32 between LIC of India Vs. Sampat Devi, (iii) I (2008) CPJ 144 between Nalini vs. LIC of India and Another., (iv) I (2009) CPJ 588 between Sapna Arora vs. LIC of India and Others, (v) III (2003) CPJ 172 (NC) between State of Punjab and Another vs. Smt. Asha Rani., and I (2009) 212 (NC) between LIC of India and Another vs. Balbir Kaur, and III (2008) CPJ 226 between LIC of India vs. Radhika Devi., (vi) AIR 1971 AP 41 between LIC of India vs. B.Chandravathamma., in support of their contention that the complainant played fraud on them by not disclosing the material facts regarding pre-existing disease and therefore repudiation of claim by opposite party No.2 is justified. The complainant and DLA are guilty of giving mis-statement and suppressed the facts while signing member form for getting insurance policy. It is alleged that the DLA had entered into contract with opposite party No.2 with malafide intention and by fraudulent method, in order to enrich himself unjustly. The opposite party is not guilty of any deficiency in service in as-much-as the deceased had suppressed the material information regarding his past medical history at the time of signing the member form. The complainant manipulated entire set of incidents in order to get the claim amount from opposite party. The opposite party further placed reliance on citations reported in (i) AIR 1937 Nag 207 at 272 between Haji Ahmed Yar Khan vs. Abdul Gani Khan, (ii) AIR 1962 SC 814 between Mithoolal Nayak vs. Life Insurance Corporation, (iii) Judgment of National Commission referred in R.P.No.4323/2012  between Smt.Devamma vs. Branch Manager Life Insurance Corporation, in support of their contention that repudiation of claim by opposite party No.2 is justified. It is stated that after understanding all the terms and conditions of the policy, the DLA submitted duly signed member form dt:22.03.2016, giving all relevant details and information in the prescribed form for an initial sum assured of Rs.12,00,000/-. It is mentioned that the policy was on reducing sum assured basis wherein the sum assured keeps reducing every month as per loan repayment done by the policyholder. That the sum assured as on the date of death is Rs.11,90,103/- and not Rs.12,00,000/- as claimed. In the member form, the DLA gave declaration that he had made complete true and accurate disclosure of all the facts and circumstances, as may be relevant for the acceptability of the risk and had not withheld any information as may be relevant for the acceptability of proposal. The questionnaire mentioned under ‘Health Declaration for Member’ have answered negative by the DLA. The questionnaire and answers were extracted in the written version. It is clearly mentioned in the terms of the policy that if any untrue statement is made in the member form, the policy contract shall be cancelled by opposite party No.2. Based on the information given by the DLA in the relevant forms and on receipt of premium amount, opposite party No.2 has issued Certificate of Insurance bearing No.G0000450 having risk commencement date as 22.03.2016. The opposite party had received death claim intimation on 09.12.2017 from the complainant, which was forwarded by Andhrda Bank. The nominee i.e. wife of the life assured has informed opposite party No.2 that life assured expired on 23.11.2017. Since the death of the life assured occurred within one year and eight months from the risk commencement date of the policy, opposite party had conducted statutory investigation through ‘Tabitha and Company’ insurance investigators under Clause-8(3) of the Insurance Regulatory and Development Authority of India Regulations 2002, after receiving claim from complainant. The DLA was suffering from Diabetes, Diabetic Ketoacidosis and kidney failure and underwent treatment for the same from 23.08.2012 to 01.03.2017 and these facts are suppressed by DLA. As per medical clinical prescription of Dr.Gangi Reddy hospital dt:07.10.2014 was a known case of type-2 Diabetes Mellitus  and was suffering from Diabetic Ketoacidosis. He was taking insulin for treatment of Diabetes. As per the lab report dt:21.04.2016 serum creatinine of DLA signifying kidney function was 2.7 mg/dl whereas normal range of serum creatinine is ranged between 0.6 to 1.2 for normal individuals. Thus, the increased level of creatinine is suggestive of kidney failure. While the blood sugar level of DLA for random blood sugar was 215 mg/dl normal range being less than 160 vide lab report dt:21.04.2016. The ECG report dt:22.11.2017 suggestive of left ventricular hypertrophy with repolarization abnormality. The DLA thus did not disclose about his past medical history while taking the policy. The contract of insurance being utmost good faith, DLA was under obligation to disclose the said material facts in the membership form, which was necessary for arriving decision by opposite party. The contract of insurance is liable to be rescinded as per Section-45 of Insurance Act 2015 as amended from time to time and no benefit is liable to be paid. Entire Section-45 of Insurance Act 1938, is extracted in the written version. Further Section-18 of Indian Contract Act 1872 is also extracted in the written version, in order to support the contention of the opposite party that contract becomes void in case of playing fraud or mis-representation by the insured. While denying all the allegations in the complaint, opposite party prayed for dismissal of the complaint on the basis of principles of law laid down in the above cited decisions.

            5.  The wife of the DLA filed chief affidavit as P.W.1, whereas J.Damodhar Naidu, Varalakshmi and Raja Babu filed chief affidavits as P.W.2 to 4, and got marked Exs.A1 to A12. On behalf of opposite party one Prashant Saini, AVP – Legal of opposite party No.2, filed chief evidence affidavit as R.W.1 and got marked Exs.B1 to B13.

            6.  The point for consideration is whether there is deficiency in service on the part of opposite parties 1 and 2? If so, to what extent the complainant is entitled for the reliefs?

            7.  Point:-  The contention of complainant as per the written arguments filed is that, the DLA had obtained house loan from opposite party No.1 to the extent of Rs.12,00,000/- on 07.02.2016 vide Ex.A1 and opposite party No.2 provided insurance coverage to DLA in view of tie-up with opposite party No.1, and DLA has submitted membership form along with consent-cum- authorization form and simple declaration of good health. Ex.A2 is loan account showing that the DLA paid Rs.1,20,806/- towards one time premium. The loan was sanctioned in two spells i.e. Rs.8,00,000/- and Rs.4,00,000/- as reflected in Ex.A2. Thereafter, opposite party No.2 had issued Certificate of Insurance vide Ex.A3. As seen from Ex.A3 the risk date commence from 22.03.2016 to 21.03.2040 for the assured sum of Rs.12,00,000/- i.e. the loan amount borrowed by DLA. There is no dispute about the payment of one time premium by DLA. Ex.A4 is no objection from co-applicants without filling the blanks. Ex.A5 is Death Certificate of DLA, who died on 25.11.2017. It is the further case of the complainant that DLA had paid 18 EMIs at the rate of Rs.12,000/- before his death, and thereafter she submitted request letter dt:04.12.2017 enclosing relevant documents like claim intimation form, for which opposite party No.2 replied on 09.12.2017 by acknowledging the death claim. Ex.A6 is the medical certificate of cause of death in form No.4. As per Ex.A6, the cause of death of DLA is cardiomyopathy. Ex.A7 is request letter dt:04.12.2017 submitted by the complainant seeking statement of claim amount. Ex.A8 is letter addressed by opposite party No.2 to complainant informing that they are in receipt of claim request made by her on 09.12.2017 and currently the same is under process, and they will keep inform the updates to the complainant on the status of the claim. Ex.A9 is legal notice issued by the complainant to opposite party No.2 demanding settlement of her claim. Ex.A10 is letter addressed by opposite party No.2 to complainant dt:07.02.2018 stating that during the investigation, it is found that the life insured was suffering from diabetes and its complication (diabetic ketoacidosis), and was under treatment for the same prior to the proposal for insurance and suppressed the material facts and gave misleading information to opposite party No.2 for the purpose of securing insurance, and therefore the claim is repudiated for non-disclosure of material information at the time of making the proposal, and premium already collected will be refunded. Ex.A11 is reply issued by opposite party No.2, to the counsel for complainant stating that the deceased DLA was a known case of diabetes and was under treatment in Gangi Reddy Hospital and the deceased was diagnosed as Diabetic Ketocidosis and was on insulin. As per the medical reports, creatinine was higher than normal range, which was suggestive of kidney failure, and it was discovered that deceased life assured (DLA) was on continuous treatment from 23.08.2012 to 01.03.2017 and the claim was repudiated as DLA deliberately suppressed the material facts, in order to avail membership in the said policy from the company. Ex.A12 is bank statement, which shows that DLA paid 18 EMIs at the rate of Rs.12,000/- commencing from 04.08.2016 to 31.03.2018. It is the further case of the complainant that after the death of the DLA she paid Rs.37,000/- to opposite party No.1 towards loan, as she was advised to pay the same, else loan becomes N.P.A.. It is the further case of the complainant that DLA and complainant are illiterates, and her husband DLA affixed signatures in good faith believing the opposite party No.2 agent. There is no question of concealment of information as to his health condition.

            8.  On the other hand, the counsel for opposite party vehemently argued that DLA deliberately concealed the treatment taken in Gangi Reddy Hospital regarding his health, and mislead the opposite party No.2 in securing insurance by playing fraud and by suppressing material facts as to his health condition and therefore the repudiation of claim by opposite party No.2 is justified for non-disclosure of material information as to the treatment taken by him in Gangi Reddy Hospital for Diabetes. Ex.B1 is member form signed by the DLA. Ex.B2 is Certificate of Insurance issued by opposite party No.2 covering risk date from 22.03.2016 to 21.03.2040. Ex.B3 is the Claim Intimation Form with regard to death claim of DLA. Ex.B4 is case sheet of Gangi Reddy Hospital relating to the deceased treatment. Ex.B5 is report of the tests undergone by the DLA dt:21.04.2016 issued by Gangi Reddy Multi Specialty Clinical Lab. Ex.B6 is report of the tests undergone by the DLA dt:21.05.2016 issued by Gangi Reddy Multi Specialty Clinical Lab. Ex.B7 is ECG. Ex.B8 shows that DLA was suggested to purchase diabetic foot care, by Dr.V.Gangi Reddy. Ex.B9 is investigation report dt:17.01.2018. Ex.B10 is copy of affidavit submitted by B.Tabitha, who is the investigator of M/s. Tabitha and Company, duly appointed by opposite party No.2 to investigate about the claim. Ex.B11 is repudiation letter issued by opposite party No.2 to complainant, repudiating the claim on the ground of suppression of material facts regarding health condition of the DLA. Ex.B12 is the notice issued by counsel for complainant dt:27.03.2018 to opposite party No.2. Ex.B13 is reply issued by opposite party No.2 to complainant counsel.

            9.  The counsel for complainant placed reliance on the following citations, in order to support his contention that there is no suppression of material facts by the DLA and that even assuming that the DLA had taken treatment in Gangi Reddy Hospital with regard to diabetes, the same cannot be connected to the death of DLA, as the DLA died due to heart attack. In R.P.No.4461 of 2012 between Neelam Chopra vs. LIC of India and others, the National Commission, New Delhi, relied on the decision of Hon’ble High Court of Delhi in Hari Om Agarwal vs. Oriental Insurance Co. Ltd., W.P.(C) No.656 of 2007 dt:17.09.2007, which is extracted as follows -                                                             

“Insurance – Mediclaim – Reimbursement – Present Petition filed for appropriate directions to respondent to reimburse expenses incurred by him for his medical treatment, in accordance with policy of insurance – Held, there is no dispute that diabetes was a condition at time of submission of proposal, so was hyper tension – Petitioner was advised to undergo ECG, which he did – Insurer accepted proposal and issued cover note – It is universally known that hypertension and diabetes can lead to a host of ailments, such as stroke, cardiac disease, renal failure, liver complications depending upon varied factors – That implies that there is probability of such ailments equally they can arise in non-diabetics or those without hypertension – It would be apparent that giving a textual effect to Clause-4.1 of policy would in most such cases render mediclaim cover meaningless – Policy would be reduced to a contract with no content, in event of happening of contingency – Therefore Clause-4.1 of policy cannot be allowed to override insurer’s primary liability – Main purpose rule would have to be pressed into service – Insurer renewed policy after petitioner underwent CABG procedure – Therefore refusal by insurer to process and reimburse petitioner’s claim is arbitrary and unreasonable – As a state agency, it has to set standards of model behavior, its attitude here has displayed a contrary tendency – Therefore direction issued to respondent to process petitioner’s claim, and ensure that he is reimbursed for procedure undergone by him according to claim lodged with it.            From the above, it is clear that the insurance claim cannot be denied on the ground of these life style disease that are so common. However, it does not give any right to the person insured to suppress information in respect of such diseases. The person insured may suffer consequences in terms of the reduced claims.            In the present case, clearly the cause of death is cardio respiratory arrest and this disease was not existing when the proposal form was filled. Clearly, there is no suppression of material information in respect of this disease, which is the main cause of death”.

 

            In the present case, clearly the cause of death is cardiaomayopathy and this disease did not exist at the time of taking proposal. In the same decision, the National Commission referred decision of Hon’ble Supreme Court in Sulbha Prakash Motegaonkar and Ors. Vs. Life Insurance Corporation of India in Civil Appeal No.8245 of 2015 dt:05.10.2015, wherein the Apex Court held that  

“We are of the opinion that National Commission was in error in denying to the appellants the insurance claim and accepting the repudiation of the claim by the respondent. The death of the insured due to ischaemic heart disease and myocardial infarction had nothing to do with this lumbar spondylitis with PID with sciatica. In our considered opinion, since the alleged concealment was not of such a nature as would disentitle the deceased from getting his life insured, the repudiation of the claim was incorrect and not justified”.

 

            Basing on the above referred Apex Court judgment, the National Commission observed that “it is clear that suppression of any information relating to pre-existing disease, if it has not resulted in death or has no direct relationship for the cause of the death, would not completely disentitle the claimant for the claim”, and further it is held that “DLA died on account of “Cardio Respiratory Arrest”, which was existing for only five months prior to the date of death. Thus, clearly, this disease was not prevailing when the proposal form was filled. The disease of diabetes though existing for some time, but was under control at the time of filling up of the proposal form. Moreover, the non-disclosure of information in respect of this life style disease of diabetes, will not totally disentitle the complainant for indemnification of the claim”.

            In another decision in New India Assurance Co. Ltd. vs. Shiv Kumar Rupramka dt:22.03.2007 by the State Commission, Delhi, it is held that “Malaise of hypertension, diabetes, occasional pain, cold, headache, arthritis and the like in the body are normal wear and tear of modern day life which is full of tension at the place of work, in and out of the house and are controllable on day to day basis by standard medication and cannot be used as concealment of pre-existing disease for repudiation of the insurance claim unless an insured in the near proximity of taking of the policy is hospitalized or operated upon for the treatment of these diseases or any other disease. If insured had been even otherwise living normal and healthy life and attending to his duties and daily chores like any other person and is not declared as a diseased person as referred above, he cannot be held guilty for concealment of any disease, the medical terminology of which is even not known to an educated person unless he is hospitalized and operated upon for a particular disease in the near proximity of date of insurance policy say few days or months. Thus any attempt on the part of the insurer to repudiate the claim for such non-disclosure is not permissible”.

            In another decision R.P.No.1160 of 2010 between Bajaj Allianz Life Insurance Co. Ltd., vs. D.Ayyapu Reddy, rendered by National Commission, New Delhi, it is held that “the proposal form was in English, it was filled by the agent of O.P. without disclosing the relevant question and obtained the signatures of the insured in the proposal form. Thus, the burden lies on the O.P. to prove that the questions of proposal form were informed to the insured and the same were explained to him in Telugu”.

            10.  The counsel for opposite party No.2 referred several citations in the written arguments as well as in written version. (i). In the decision rendered by Hon’ble Supreme Court  between Satwant Kaur Sandhu vs. New India Assurance Company Ltd., SC 2776 of (2002), wherein it is held that

“the term ‘proposal form’ as defined under the Insurance Regulatory and Development Authority, 2002 as a ‘form’ to be filled in by the proposer for insurance, by furnishing all material information required by the insurer to decide whether to accept or decline, to undertake the risk, and in the event of acceptance of  the risk, to determine the rates, terms and conditions of a cover t be granted, and observed that in a contract of insurance, any fact which would influence the mind of a prudent insurer in deciding whether to accept or not to accept the risk is ‘material fact’. If the proposer has knowledge of such facts, he is obliged to disclose it particularly while answering questions in the proposal form. It is submitted that the complainant has no ‘locus standi’ to claim any alleged sum assured, as the insurance policy was obtained by the DLA by mis-representation of material facts in order to defraud the opposite party. The contract of insurance is void, and not tenable in the eyes of law as it is entered by DLA to defraud the opposite party. In these circumstances, the complaint is liable to be dismissed in limine”.

 

            (ii).  Decision reported in III (2006) CPJ 32 – LIC of India vs. Sampat Devi, it is observed as follows –

“In our concerned opinion, there are certain diseases such as kidney, heart and brain and they are connected with the life span of a person and if any mis-statement is made in respect of such type of diseases by the person seeking insurance, in such case it can be believed that knowingly the person taking out the insurance has made mis-statement”.

 

            (iii).  Decision reported in I (2008) CPJ 144 – V.Nalini vs. LIC of India and Another, wherein the State Commission of Tamil Nadu held that “the suppression of a serious ailment pertaining to heart, brain or kidney make the repudiation of claim justified”.

            (iv).  Decision reported in I (2009) CPJ 588 – Sapna Arora vs. LIC of India and others, wherein the Punjab State Commission held that

“a person being treated by a doctor is bound to give correct information about his health condition in order to receive appropriate treatment. Therefore, documents such as discharge certificate or bed-head ticket have been held to be valid basis for repudiation. Thus, the complaint is liable to be dismissed”.

 

            (v).  Decision reported in III (2008) CPJ 225 – LIC of India vs. Radhika Devi, wherein the Uttarakhand State Commission held “the very fact of early claim is a good corroborative evidence to prove misrepresentation, material non-disclosure or contemplation of death. Thus, the complaint is liable to be dismissed”.

            (vi). Decision reported in AIR 1971 AP 41 – LIC of India vs. B.Chandravathamma, wherein the Division Bench of Hon’ble Andhra Pradesh High Court held

           

“The proposal, the personal statement and the life insurance policy all contain a special clause putting the insured on notice that in case of any such deliberate misrepresentation, the contract of insurance would become void and the amounts paid thereunder shall be forfeited. The misrepresentation, therefore, is fraudulent and deliberate and is with respect to a material particular”.

 

            (vii).  Decision reported in AIR 1962 SC 814 – Mithoolal Nayak vs. Life Insurance Corporation, wherein the Hon’ble Supreme Court held

           

“There is a mis-statement on a material matter, or suppression of facts which it was material to disclose The suppression was fraudulently made by the policy holder. The policyholder must have known at the time of making the statements that he was false or that he suppressed facts which it was material to disclose”.   It was also held in the above said case that “Suppression of material facts while making a proposal for insurance by one having knowledge or belief of the fact would fall under Section-17 of the contract Act and would be vitiated thereby”.   It was further held in the above said case that “where the contract is bad on the ground of fraud, the party who has been guilty of fraud or a person who claims under him cannot ask for a refund of the money paid”.   Further, as per English law, as mentioned in Halsbury’s Laws of England “Even in the absence of specific questions, the proposer must disclose voluntarily the following facts or circumstances because they are material – Facts, which render or tend to show that the risk is greater than normal. Facts, which suggests any special motive for taking the insurance.   The opposite party therefore rightly exercised its right to decline the claim by avoiding the contract on the ground of misrepresentation and non-disclosure of material information.

 

            11.  There cannot be any dispute as to the principles of law laid down in the above decisions, as argued by the opposite party counsel. It is no doubt true that the DLA had taken treatment in Gangi Reddy Hospital with regard to diabetes. It is an admitted fact that the deceased died due to heart attack. In view of the citations submitted by the counsel for complainant, it cannot be said that there is deliberate concealment of medical treatment taken by the deceased in securing the insurance policy fraudulently, since the cause of death cannot be connected to earlier medical treatment taken by DLA in Gangi Reddy Hospital. On perusal of the documentary evidence and after going through the citations, and basing on the citations referred by complainant, we are of the considered view that the repudiation by opposite party is not justified, since there is no deliberate concealment of earlier treatment taken by the DLA. Accordingly, this complaint is allowed.

            12.  In the result, complaint is allowed directing the opposite party No.2 to clear the existing debt with opposite party No.1 by paying Rs.13,41,680.90 ps. (Rupees thirteen lakhs forty one thousand six hundred and eighty and paise ninety only) as on 07.04.2018 and also further dues towards debt to be payable. Further, the opposite parties 1 and 2 jointly and severally directed to pay Rs.37,000/- (Rupees thirty seven thousand only) paid by the co-applicants after the death of the DLA, and further directed the opposite parties to pay a sum of Rs.5,000/- (Rupees five thousand only) for undergoing mental agony and also directed to pay Rs.3,000/- (Rupees three thousand only) towards costs of the litigation to the complainant. Time for compliance of the order is two (2) months, failing which the compensation amount of Rs.5,000/- shall carry interest at 9% p.a. from the date of this order, till realization.       

            Dictated to the stenographer, transcribed and typed by him, corrected and pronounced by me in the Open Forum this the 25^th day of January, 2019.

 

        Sd/-                                                                                                                     Sd/-                                      

Lady Member                                                                                               President (FAC)

 

APPENDIX OF EVIDENCE

 

 

Witnesses Examined on behalf of Complainant/s.

 

PW-1: N. Vijaya  (Chief affidavit filed).

PW-2: J. Damodhar Naidu (Evidence/Chief affidavit filed).

PW-3: Varalakshmi (Evidence affidavit filed).

PW-4: Raja Babu (Evidence affidavit filed).

 

Witnesses Examined on behalf of Opposite PartY/S.

 

RW-1: Prashant Saini (Chief/Evidence Affidavit filed).

 

 

EXHIBITS MARKED ON BEHALF OF THE COMPLAINANT/s

 

Exhibits (Ex.A)	Description of Documents
	Self attested true copy of Letter of Sanction regarding House Loan given by Andhra Bank, Chandragiri Branch, Chittoor District. Dt: 07.02.2016.
	Self attested true copy of Andhra Bank Chandragiri Branch Pass Book.
	Self attested true copy of CERTIFICATE OF INSURANCE. Cover Commencement Dt: 22.03.2016.
	Self attested true copy of NO OBJECTION FROM C-APPLICANTS.
	Self attested true copy of DEATH CERTIFICATE (Date of Death: 23.11.2017) Date of Issue: 28.11.2017.
	Self attested true copy of MEDICAL CERTIFICATE OF CAUSE OF DEATH( Form No.4). Dt: 23.11.2017.
	Office copy (Self attested true copy) of the Request Letter. Dt: 04.12.2017.
	Original copy of Letter sent by O.P.No.2. Dt: 09.12.2017.
	Office copy of Legal Notice. Dt: 27.03.2018.
	Original copy of Letter of Repudiation of Claim. Dt: 07.02.2018.
	Reply to your Legal Notice dated 27.03.2018. Dt: 18.04.2018.
	Attested true copies of Transactions Inquiry details given by Andhra Bank, Chandragiri Branch, Chittoor District.

 

EXHIBITS MARKED ON BEHALF OF THE OPPOSITE PARTY/s

 

Exhibits (Ex.B)	Description of Documents
	Certified true copy of Member form-IndiaFirst Group Credit Life Plan                (Annexure-OP-01). Dt: 22.03.2016.
	Certified true copy of CERTIFICATE OF INSURANCE (Annexure-OP-02). Cover Commencement from Dt: 22.03.2016 to21.03.2040.
	Certified true copy of Claim Intimation form-Death along with Death Certificate (Annexure-OP-03).
	Certified true copy of Doctor Prescriptions (Gangi Reddy Diabetic Foot Care Hospital, Tirupati) (Annexure-OP-04).
	Certified true copy of Lab Report (Gangi Reddy Multi Specialty Clinical Lab, Tirupati) (Annexure-OP-05). Dt: 21.04.2016.
	Certified true copy of Lab Report (Gangi Reddy Multi Specialty Clinical Lab, Tirupati) (Annexure-OP-06). Dt: 21.05.2016.
	Certified true copy of ECG Report (Annexure-OP-07). Dt: 22.11.2017.
	Certified true copy of  “TO WHOM SO EVER IT MAY CONCERN” from Dr. V. Gangi Reddy, M.D., Diabetologist, Gangi Reddy Diabetic Foot Care Hospital, Tirupati) (Annexure-OP-08). Dt: 13.01.2018.
	Certified true copy of Investigation Report (Annexure-OP-09). Dt: 17.01.2018.
	Certified true copy of Affidavit submitted by B. Tabitha, D/o. B. David (Annexure-OP-10). Dt: 20.03.2018.
	Certified true copy of Letter of Repudiation of Claim (Annexure-OP-11). Dt: 07.02.2018.
	Certified true copy of Legal Notice (Annexure-OP-12) Dt: 27.03.2018.
	Certified true copy of ‘Reply to your Legal Notice, Dt: 27.03.2018’. Dt: 18.04.2018.

 

 

                                                                                                                       Sd/-        

                                                                                                                President (FAC)

    

     // TRUE COPY //

// BY ORDER //

 

Head Clerk/Sheristadar,

          Dist. Consumer Forum-II, Tirupati.

 

 

  Copies to:-   1.  The complainant.

                        2.  The opposite parties.