Before the District Forum: Kurnool
Present: Sri K.V.H. Prasad, B.A., LL.B., President
And
Smt C.Preethi, M.A., LL.B., Member
Sri R.Ramachandra Reddy, B.Com., LL.B., Member
Friday the 4th day of February, 2005
C.D.NO. 4/2004
M.Subbashini,
W/o. Late M.Prabhakar,
D.No. 50-753-45,
Tagore Nagar,
Kurnool. . . . Complainant represented by her counsel
Sri K. Yerukal Reddy.
-Vs-
1. Branch Manager,
L.I.C. of India,
Kurnool.
2. Divisional Manager,
L.I.C. of India,
College Road,
Cuddapah. . . . Opposite parties represented by their counsel
Sri S.Viswanatha Reddy.
O R D E R
(As per Sri R.Ramachandra Reddy, Member)
1. This CD complaint of the complainant is filed under section 12 of the C.P. Act 1986, seeking a direction on the opposite party No.1&2 to pay an assured amount of Rs.1,00,000/- with all benefits and interest at the rate of 18% per annum from the date of the death of insured, Rs.10,000/- as compensation for mental agony, costs of this complaint and any such other relief or reliefs which the complainant is entitle in the circumstances of the case.
2. The brief facts of the complainant’s case are that the complainant husband late M. Prabhakar took endowment LIC policy No. 652283113 for Rs.1,00,000/- on 28.2.2000 from opposite party No.1. The complainant is the nominee of insured. Insured died on 23.8.2001 due to severe cough and fever. The policy was inforce by then, the complainant submitted all documents, claiming assured amount with all benefits thereon. But the claim of the complainant was repudiated by opposite party No.2 through its letter dt 31.3.2003 on the ground that the insured has suffered from Pleural Effusion, Diabetes prior to the date of the proposal of the policy, but suppressing the said fact regarding his health condition he took policy. Against that repudiation, as informed in the same letter, the complainant sent a requisition letter dt 29.6.2003 to the Zonal Office LIC Hyderabad requesting her settlement of her claim, but the opposite party No.2 on 30.10.2003 in formed that Zonal office also upheld the said repudiation.
3. The insured before taking policy was examined by the LIC authorized medical practitioner, who also certified that the insured was not having any disease much less, pleural Effusion, diabetes. Insured never took any treatment for the said disease. He never, knowingly that he had any such disease, suppressed regarding his health at the time of taking policy. Even when the doctor examined the insured he too did not notice that the insured had any such disease. Even assuming with out conceding that the deceased might have the disease of diabetics even prior to the date of proposal of the policy, the opposite party must have paid the claim amount, as diabetes is not a disease which occurs occasionally also. But the cause of death even according to the opposite parties is pleural effusion which might have been developed subsequent to the taking of the policy only. As the insured was not at all suffering from pleural effusion diabetes, as on the date of proposal of the policy or prior to that, question of suppressing the said decease, while taking policy does not arise. The allegation made by the opposite parties that the insured knowingly, that he had the decease of pleural effusion, diabetes, had suppressed in the proposal form is false, and also repudiating the claim on that sole ground amounts to deficiency of service and also negligence on their part. Hence the complainant approached this Forum seeking redressal.
4. The complainant in support of its case placed reliance on the following documents Viz (1) repudiation letter dt 31.3.2003 of opposite party No.2 (2) in pursuance of said repudiation this complainant addressed a letter dt 29.6.2003 (office copy of letter filed) to the Zonal Manager, LIC of India Zonal Office, Hyderabad stating that the said repudiation is not valid and not proper as alleged by opposite party No.2 as the complainant being the wife of insured as never seen him suffered from the pleural effusion and diabetes prior to the proposal and more over the complainant’s husband was presented for medical examination before taking policy and insured might have applied sick leave, as he was not having any other leave to his credit and requested the said officer to consider her case. In view of said facts as she being the nominee of the policy do not have any other property, only the claim amount under the said policy will help for her lively hood (3) After hearing the decision of Zonal Office opinion, the Sub-Divisional Manager communicated the repudiation letter in its letter dt 30.3.2003 to the complainant. This said documents are marked as Ex A.1 to A.3 besides to her sworn affidavit in reiteration of her complaint averments and also filed two citation with memo, interrogatories caused by complainant to opposite parties and reply given by complainant to the interrogatories of Op No.2 for their appreciation in this case.
5. In pursuance of the service of the notice of this forum as to the case of the complaint, the opposite parties appeared through their standing counsel and contested the case, the opposite party No.2 filed written version denying any of its liability and opposite party No.1 adopted the written version of Op No.2
6. The written version of opposite parties even thoroughly admits the deceased M.Prabhakar’s wife, the complainant as holder of policy as stated in the complaint for assured sum of Rs.1,00,000/- on 20.2.2000 and nominated his wife Smt M.Subhashini as nominee but allege suppression of material facts as to his state of health and the treatment he has under gone prior to the proposing the said policy and answering negatively to the questionnaire in No.11 of the proposal form and as per the declaration the untrue averments found in the said proposal form makes the contract of insurance null and void and all the monies paid to the corporation shall stand forfeited to the corporation as per the declaration and the policy condition No.5. As the claim of policy for assured amount, consequently the demise of the policy holder on 23.8.2001 being within one year five months 25 days form the date commencement of policy, as the claim of amount is early claim, investigation was taken up and learnt that the said policy holder was unwell early to 20.2.2000 and took treatment for pleural effusion and diabetes mellitus, diabetic ulcer of foot and weekness from doctor Mohammed Ali, condition No.5 of the policy also makes void the policy for with holding any material information and forfeiture all the amounts paid to the corporation in the consequence of said policies in favour of corporation in view of the nature of the contract made on utmost good faith on the deceased statements and the declaration as to the suppression of any material facts makes the policy null and void under section 45 of the insurance act, 1938 and attracting the forfeiture of the amounts and hence, the repudiation of the claim is proper and the action of opposite party No.2 in the said repudiation suffers with no deficiency and hence seeks the dismissal of complaint with costs.
7. In substantiation of its case the opposite parties filed the following documents Viz.,(1)letter dt.20.3.2003 of R.W.1 to the O.P( 2) prescription dt.7.2.1999 (3) prescription dt.6.6.1999 of the deceased given by R.W.1(doctor) (4) X-Ray of the deceased (5) Proposal form submitted by the deceased to the O.P.No.2 dt.20.2.2000(6) original Endowment Assurance policy with profits + ACC. benefit No.652283113 dt.28.2.2000 which is to be matured on 28.2.2011 with conditions and privileges issued to the deceased (7) Medical Examiners confidential report of the deceased(8) Xerox copy of the certificate issued by Indian Board of Alternative Medicines to Dr.Mohammed Ahamed Ali, besides to the sworn-affidavit of the O.P.No.2 in re-iteration of its written version as defence and the above documents are marked as Ex.B.1 to Ex.B.8 and also relied on R.W.1(doctor’s witness) deposition in Chief Cross Examination and interrogatories of counsel of O.P’s.No.2 to the complainant and its reply, for its appreciation in this case.
8. Hence, the point for consideration is whether the complainant has made out the alleged deficiency of service in the conduct of opposite parties in repudiation of claim so as to enable herself to the reliefs claimed?:-
9. It is not in dispute that the deceased by name has taken Endowment Assurance Policy with profits + ACC. Benefits (Ex.B.6) by submitting the proposal form on 20.2.2000(Ex.B.5). It is not in dispute that the complainant/nominee put-forth the claim form for the insured amount under the policy, the claim was repudiated by the O.P.No.2 vide Ex.A.1 on 31.3.2003, regarding the policy bearing No.652283113 of the deceased M. Prabhakar. It says that the claim was repudiated as the said policy holder suffered from pleural effusion, diabetes and he had consulted a medical man and had taken a treatment from a hospital prior to the date of proposal and suppressed the said facts by the said policy holder in his proposal form (Ex.B.5).
10. The Ex.B.1 is the sworn affidavit of the doctor dt.20.3.2003 who treated the deceased/insured and the Ex.B.2 and B.3 are the prescription slips which are intact said to have been given to the deceased by the said doctor when the deceased attended to his clinic twice on 7.2.1999 and 6.6.1999 respectively for pleural effusion, diabetic-mellitus and found that he was restless and weak and suffering with diabetic ulcer of foot and he was not taken any proper treatment for diabetic mellitus and advised to see an Endocronologist for diabetic mellitus, management. In this affidavit, the said doctor which was given to Assistant Branch Manager, L.I.C, Kurnool, has no whisper about the X-Ray which is marked as Ex.B.4. The Ex.B.7 dt.20.2.2000 is a medical Examiner’s confidential report of L.I.C Dr.M.V.Ramana Rao, M.B.B.S, M.D of o.P.No.2 who examined the insured/deceased after lapse of 8 months of the alleged treatment of M.Prabhakar/insured by the R.W.1(doctor) who has given affidavit (Ex.B.1) two prescriptions (Ex.B.2&B.3) and seen the X-Ray (Ex.B.4) and the said LIC doctor filled the column No.2 and for the questions No.s .3,14 to 16 at the time of Examination after ascertaining the answers from the deceased for the questions No.s 4 to 13. As per the said doctor after examination of the insured to question No.3 the LIC doctor said ‘yes’ to the general appearance as to the healthy of the said insured and observed and noted in the column No.2 the full inspiration was 89 cms where as full expiration was 84 cms., after 8 months (i.e 20.2.2000) of the observation of the R.W.1 (witness/doctor) wherein he observed that the deceased was suffering from pleural effusion, diabetic mellitus and diabetic ulcer of foot (whether right foot or left foot not mentioned) and said to have given prescriptions i.e Ex.B.2 and B.3 which are intact, in the said prescriptions about diabetic ulcer of foot, if it was so, the said doctor failed to mention in the said prescriptions where as he has diagnosed the deceased has right pleural effusion with DMM in Ex.B.2 dt.7.2.1999 and prescribed medicines and review after 3 months and in Ex.B.3 dt.6.6.1999 he has advised the insured for investigation X-Ray chest and asked him to see Endocronologist. Further the said doctor who treated the insured lastly on 06.6.1999 stated in his affidavit (Ex.B.1) dt.20.3.2003 i.e after 3 years 9 months that too who do not have any record pertaining to the insured in his clinic as to the treatment given to the said insured, who admitted in his cross-examination in his deposition (R.W.1) and further stated that the insured was irregular in taking the medicines and not taking any proper treatment for the diabetic mellitus. If such is so as per the deposition of R.W.1, Doctor M. Ahammed Ali, B.Sc., M.B.B.S., M.D., who treated the insured on 7.2.1999 and 6.6.1999 by giving with prescriptions (Ex.B.2&B.3) and said that he know M. Prabhakar, who was worked as Multipurpose Supervisor in the District T.B.Department,the said M. Prabhakar visited him on 7.2.1999 and 6.6.1999 with right pleural effusion (accumulation of the water in the lungs),and suffering with diabetic also as per his previous prescriptions shown to him and given treatment for the said decease and mentioned the said facts and also the diabetic ulcer on foot in the Ex.B.1,but no whisper in Chief Examination of the O.P.counsel about such serious symptoms in diabetic patients about the diabetic ulcer on foot and further informed in deposition of R.W.1that he has examined the chest X/Ray Ex..B4 produced before him and diagnosed as Right pleural effusion at the time of said Prabhakar’s visit to his clinic (Ex.B.2 and B.3). In Ex.B.1 the affidavit of the R.W.1 (doctor) who treated the insured has not mentioned about the X/Ray and the said Ex.B.4 i.e X-Ray filed without observations of the Radiologist which is the cogent material to prove the said decease beyond doubt. Further in the cross examination by the complainant’s counsel the deposition of the R.W.l admitted that the prescriptions (Ex.B.2 and B.3) has not given to the LIC, but given to the said patient Prabhakar only. Here the question arises how the original prescriptions and X. Ray (Ex.B.2,toB.4) seen the light when the doctor who treated insured and in his deposition in cross-examination denies that he has not given to the LIC, but to the patient Prabhakar/Insured, where as O.P.No.2 in its written version and sworn-affidavit at para 6 mentioned that it is evident from the Affidavit dt.20.3.2003 given by the doctor M. Ahammed Ali supported by the prescriptions and the X-Ray film dt.6.6.1999(Ex.B.4) that life Assured M. Prabhakar attended his clinic during the year 1999 for pleural effusion and the diabetic mellitus. As seen from the above the version of the O.P.No.2 and the version of the said doctor (R.W.1) in his deposition contradicted with each other regarding to the obtaining of material pertaining to the Ex.B.2 to B.4. The Ex.B.8 is the Xerox copy of the certificate (attested) given by the Indian Board of Alternative Medicines pertaining to the said doctor wherein it was mentioned that above named is hereby authorized to use the suffix M.D (A.M) after candidates name, where as the said doctor in its prescriptions (Ex.B.2 and B.3) and the stamp affixed to the affidavit (Ex.B.1) used M.D contrary to the said certificate. It bears only on the evidence, but not on the treatment of the said doctor alleged to have given to the insured.
11. The O.P.No.2 in its written version and sworn-affidavit alleges that the insured was on Medical Leave from 11.12.1998 to 15.12.1998 as per claim form ’E’ (Exhibit-5) and was availing treatment for Eye problem from 13.10.1998 to 08.12.1998 for Cataract Surgery with an Intraocular lens transplantation as per RC.No.20 / SA –E/DTC/KNL/99 dated 05.02.1999 of Dr. G.Venkataramana, District T.B. Central Officer, Kurnool. The life assured had submitted a letter dt.12.01.99 addressed to the Superintendent, Govt.Regional Eye Hospital, Kurnool affirming his physical disability due to fracture of right leg. The letter RC No.20/SA-E/DTC/Knl/99 dt.05.02.1999 of Dr. G.Venkataramana, District T.B. Central Officer, Kurnool and the two letters of life assured dt.12.01.1999 & 01.10.1999 are marked as Exhibit-6,Exhibit-7 & Exhibit-8 respectively. All these averments and pleas are only for plea sake, but no such evidence or material or record as to Ex B.5 to Ex B.8 as mentioned above from the said concerned authorities in support of its case were not filed for its appreciation. Merely filing Ex.B.1 to B.8 without any proof does not mean that the contents there of necessarily true. No documents or direct evidence produced by the opposite parties about the prior existence of pleural effusion diabetic mellitus, mere assertion with prescriptions in respect of treatment prior to taking up of policy neither inspires any confidence nor can be acted upon. Onus is on the opposite parties to substantiate their plea that the complainant has conceiled material facts of his treatment before taking the policy or at the time of submitting the proposal form. Hence exhibits filed by the opposite parties has no relevance to looked into nor it can inspire any confidence.
12. Having regard to overall consideration, there is no hesitation to hold the opposite parties have miserably failed to substantiate that the complainant before taking the policy or at the time of submitting proposal form suppressed material information about taking treatment for pleural effusion and diabetic mellitus, from the doctor M. Ahammed Ali, relied by the opposite parties. Therefore in these circumstances the repudiation of the claim by the opposite parties is wholly arbitrary, un-reasonable and un-just and amounts to deficiency of service on their part.
13. The written version and sworn-affidavit of the opposite parties contends that the complainant negatively answered to the questionnaire in the serial No.11 of the proposal form makes the contract of Insurance null and void and condition No.5 of the policy also makes for withholding the material information, hence the repudiation of claim was made in good faith having regard to the facts and circumstances of the case and after proper investigation. This contention is equally devoid of merit and force, as it has been already held that the repudiation is arbitrary and untenable and the claim of the complainant should not have been rejected as per the decision of Himachal Pradesh State Consumer Disputes Redressal Commission, reported in 1999 Consumer Cases Reporter page 416.
14. In support of the complainant’s case the counsel for the complainant cited two judgments (1) in II(1997)C.P.J 137 Hariyana State Consumer Disputes Redressal Commission, Chandigarh in L.I.C. of India Vs Rampati has clearly held, claim could not be repudiated as insured suffering from diabetes and the said facts not dis-closed as the diabetes is not a serious ailment, such repudiation is arbitrary and also observed by the said Hon’ble Commission that there was no mis-statement or suppression of any material facts as the same insured person was before the Insurer-LIC, who had been subjected to medical checkup and examination by the L.IC doctor. Even if the medical examination of the deceased conducted by the doctor of LIC was not to be treated as authentic as contended by the learned counsel for the LIC, yet diabetes was not such a serious ailment which was necessary for the insured to bring to the notice of the Insurance Corporation. For these reasons the repudiation of the claim by the LIC was holly arbitrary and without any cogent or convincing reason (2) In 2003-CTJ 468(C.P) (N.C.D.R.C) in Mrs. S. Abhita Vs LIC has clearly held if no material brought on record to show that the deceased intentionally and fraudulently suppressed the facts of his health from the LIC in such case the impugned order passed by the State Commission set-aside and that the of the District Forum up-held and the revision allowed.
15. In II/2004 C.P.J 582 in LIC of India Vs Lakshmi Karnatka of Uttaranchal State Consumer 5
Disputes Redressal Commission, Deharadun has clearly held that repudiation of the claim of insured who was on frequent medical leaves, ill from the Appendicitis taken treatment, such contention not acceptable. The Employees often take leave, on medical ground off and on to consume leaves that mere taking medical leave no ground to presume that insured suffering from Appendicitis, Company has to prove fact of actual illness. Complaint rightly allowed by the Forum and further observed by citing the said Hon’ble State Commission in support of its case the Supreme Court judgment reported in I (2001) S.L.T 89= I (2001) C.L.T 89 in LIC of India Vs Asha Goyal, wherein the Hon’ble Supreme Court has held that the claim cannot be rejected merely on the ground that the victim has not disclosed true facts in the proposal form. The learned Forum further referred the ruling reported in II 1197 C.P.J-I (N.C)=1997(2)C.P.R21 New India Assurance Company limited Vs D.P. Khanna wherein it has been specifically held that it is the duty of the Insurance Company to prove the fact of actual illness and after the revival of the policy, the Insurance Company cannot escape from the liability merely by saying that the insured has not disclosed the true facts. Hence this appeal has got no force and is liable to be dismissed.
16. Therefore, in conclusion of the above discussions and following the afore mentioned decisions having regard to such circumstances, the complaint is certainly remaining entitled to the reliefs made in the complaint.
17. In the result, the complaint is allowed, directing the opposite parties to pay to the complainant the insured amount as per the policy of the deceased M. Prabhakar bearing No.652283113 with interest at the rate of 9% per annum from the date of the death of the insured till realization along with Rs.3, 000/- as costs of this case within a month from the date of the receipt of this order.
Dictated to the Stenographer, typed to the dictation, corrected by us, pronounced in the Open Court, this the 04th day of February, 2005.
MEMBER PRESIDENT MEMBER
