Orissa

Cuttak

CC/14/2018

Mrs Pratima Prusty - Complainant(s)

Versus

Chairman-cum-Managing Director,Kotak Life Insurance Company Limited - Opp.Party(s)

R K Pattanaik & associates

01 Nov 2023

ORDER

IN THE COURT OF THE DIST. CONSUMER DISPUTES REDRESSAL COMMISSION,CUTTACK.

C.C.No.14/2018

 

Mrs. Pratima Prusty,

W/o: Late Suresh Chandra Prusty,

At/PO:Balugaon,P.S:Balugaon,

Dist:Khurda-752030.                                                ... Complainant.

 

          Vrs.

 

1.       Kotak Life Insurance Company Ltd.,

Represented through its Chairman-cum-Managing Director,

Having its regd. Office:2^nd Floor,Plot No.C-12,

G-Block,BKC,Bandra( E),Mumbai-400051,India.

     

2.       Kotak Life Insurance Company Ltd.,

Represented through its Branch Head,

Kailash Plaza,Link Road,Room No.29,

2^nd Floor,Cuttack-753012.                                ...Opp.Parties

 

 

Present:         Sri Debasish Nayak,President.

                      Sri Sibananda Mohanty,Member.

 

Date of filing:    29.01.2018

Date of Order:  01.11.2023

 

For the complainant:           Mr. R.K.Pattnaik,Adv . & Associates.

For the O.Ps No.1 & 2:           Mr. D.P.Tripathy,Adv. & Associates.

.

Sri Debasish Nayak,President.      

Case of the complainant bereft unnecessary details as made out from the complaint petition in short is that the deceased husband of the complainant Suresh Chandra Prusty had opted for one life insurance policy from the O.Ps on 16.2.2015 vide policy No.03151465.  As per the terms and conditions of the said policy, it was for a period of 20 years with assured sum of Rs.4,55,000/- and the half yearly premium was @ of Rs.15,533/-.  The husband of the complainant had died due to cardiac arrest at Astha Hospital on 19.8.2015.  The complainant being the nominee of the deceased assured being his wife had made her claim before the O.Ps on 26.7.2017.  But quite astonishingly her claim was repudiated by the O.Ps through their letter dated 23.11.2017 on the grounds that the material facts were not disclosed about the previous policy particulars at the time when the insured had applied for the policy to the O.Ps and had filled-up the proposal form.  It is further stated by the complainant that in the meanwhile after the death of her husband, her son had also expired.  She has urged through her complaint petition that there was no such policy in existence as per the claim of the O.Ps and thus repudiation on the said ground is illegal.  It is for this, the complainant has come up with her case seeking release of the assured sum with respect to the policy as obtained by her late husband Suresh Chandra Prusty to the tune of Rs.4,55,000/- alongwith interest thereon @ 12% per annum from the date of repudiation till the total amount is quantified together with another sum of Rs.50,000/- towards mental agony and harassment and further a sum of Rs.20,000/- towards cost of her litigation from the O.Ps.

Together with her complaint petition, the complainant has filed copies of several documents in order to prove her case.

2.       Both the O.Ps have contested this case and have filed their joint written version wherein they have stated that the case of the complainant is not maintainable which is liable to be dismissed.  The repudiation of the policy as obtained by the late husband of the complainant was due to intentional suppression of the pre-existing insurance policy particulars while filling up the proposal form.  It is the contention of the O.Ps in their written version that they would not have issued the policy in favour of the deceased life assured Suresh Chandra Prusty if they would have known about pre-existing policies of the said deceased assured.  In this contest, the O.Ps have relied upon a decision of the Hon’ble Supreme Court in the case of TATA AIG Life Insurance Corporation Ltd. Vrs. Odisha State Cooperative Bank & Anr. Reported in (2012) CPJ 310 (NC) wherein it is held that “if it is proved that the proposal has concealed material facts in the proposal form then the claim should be repudiated by the insurer”.  They have also quoted another decision of the Hon’ble National C.D.R.Commission in the case of Dinesh Bhai Chandrana Vs. LIC & Anr. F.A No.242/2006 decided on 27.7.2006 where it is held that the complaint petition is liable to be dismissed on the ground of concealment of material facts.  The O.P have also relied upon the decision of the Hon’ble Supreme Court in the case of Smt. Sarbati Devi and Anr. Vrs. Smt. Usha Devi (1984) 1 SCC 424 wherein it is held that “mere nomination does not have the effect of conferring to the nominee any beneficial interest in the amount payable under the life insurance policy on death of the insured”.  The same thing has been reiterated by the Hon’ble Supreme Court in the case of Vishin N Khanchandani and Another Vs. Vidya Lachmandas Khanchandani and Another (2006) 6 SCC 724.  The O.Ps have also harped upon the maxim ‘Uberrimae Fidei’ and have cited the decision of the Hon’ble Supreme Court in the case of Satwant Kaur Sandhu Vs. New India Assurance Company Ltd. [2009 (9) Scale 488] wherein it is held that “ a contract of insurance falling in the category of contract uberrimae fidei, meaning a contract of utmost good faith on the part of the assured.  Thus, it needs little emphasis that when an information on a specific aspect is asked for in the proposal form, an assured is under a solemn obligation to make a true and full disclosure of the information on the subject which is within his knowledge”.  The O.Ps have also stated that the Company U/S-45 of the Insurance Act,1938 can repudiate the claim under the policy in question on the ground of non-disclosure of material facts.  In the case of P.C. Chako and Anr. Vs. Chairman, Life Insurance Corporation of India and Ors, 2008 CPJ 78 SC, the Hon’ble Supreme Court held that “The insured furthermore was aware of the consequence of making a mis-statement of fact.  If a person makes a wrong statement with knowledge of consequence thereof, he would ordinarily be stopped from pleading that even if such a fact had been disclosed”.  The O.Ps have also cited the decision of Reliance Life Insurance Co. Ltd. Vs. Madhavacharya(R.P No.211 of 2009) wherein the Hon’ble National Commission has clearly stated that “Since the insurance between the insurer and the insured is a contract between the parties, the terms of the agreement including applicability of the provision and also its exclusion had to be strictly construed to determine the extent of the liability of the insurer”.  The O.Ps have also harped upon the death claim as made by the complainant here in this case on 26.7.2017 whereas she being the nominee of her insured husband who had died on 19.8.2015.  Thus, it is the contention of the O.Ps through their written version to dismiss the complaint petition as filed by the complainant with exemplary cost.

          The O.Ps have also filed copies of several documents alongwith their written version in order to establish their stand.

3.       Keeping in mind the averments as made in the complaint petition and the contents of the written version of the O.Ps, this Commission thinks it proper to settle the following issues in order to arrive at a definite conclusion here in this case.

i.          Whether the case of the complainant is maintainable?

ii.         Whether there was any deficiency in service on the part of the O.Ps  ?

iii.        Whether the complainant is entitled to the reliefs as claimed by her?

Issues no.ii.

Out of the three issues, issue no.ii  being the pertinent issue is taken up  first for consideration here in this case.

After perusal of the complaint petition, the written version, the written notes of submissions filed from either sides and also perusing copies of documents filed from either sides in this case, it is noticed that admittedly Late Suresh Chandra Prusty had obtained Kotak Premier Endowment Regular Policy from the O.Ps on 20.2.2015 vide policy No.03151465 wherein the assured sum was of Rs.4,55,000/- and the half-yearly premium for twenty years was @ Rs.15,533/-.  It is not in dispute that the present complainant being the wife of the deceased assured was the nominee in the said policy of the deceased assured Suresh Chandra Prusty who died on 19.8.2015.  As it is noticed that the complainant/nominee had raised her claim before the O.P on 26.7.2017 and the O.Ps had repudiated her claim through their letter dated 23.11.2017.  The repudiation was mainly due to non-disclosure of the existence of the previous policy particulars while the insured Suresh Chandra Prusty had filled-up his proposal form for the said policy on 16.2.2015 with the O.Ps.  The complainant has mentioned in her complaint petition that there was non-existence of any such previous policy those which the O.Ps wanted to have been disclosed.  So according to her, the repudiation as done by the O.Ps on those grounds for the death claim of her late husband is illegal.  When the complainant has taken the plea about the non-existence of any such policy by her deceased husband, burden of proof definitely shifts upon the O.Ps so as to prove about the particular insurance policy/policies those which, according to them were availed by the deceased policy holder Suresh Chandra Prusty prior to filling-up the proposal form on 16.2.2015 for obtaining the policy from them.  But quite astonishingly though the O.Ps have relied upon a catena of decisions as regards to the suppression of material facts and as regards to the non-disclosure of the pre-existing policies, they have not uttered anything as regards to the policy particulars those which were suppressed by the deceased insured Suresh Chandra Prusty.  In absence of any iota of evidence from the O.P’s side in this regard, this Commission cannot simply jump into a conclusion that infact there was suppression of material particulars or there was non-disclosure of the policy/policies by the deceased insured Suresh Chandra Prusty prior to obtaining the policy in question here in this case.  As such, all the decisions as relied upon by the O.Ps are absolutely of no use for the O.Ps here in this case who have failed to apprise this Commission about the particular policies those which the deceased/insured Suresh Chandra Prusty had availed but had not disclosed those while executing the proposal form with the O.Ps for obtaining the policy from them.  It is for this, this Commission comes to a conclusion that by repudiating the claim of the beneficiary/complainant towards the death claim of her deceased husband Suresh Chandra Prusty, the O.Ps are found to be deficient in their service and accordingly, this issue leans in favour of the complainant.

Issues no.i & iii.

From the discussions as made above, the case of the complainant is definitely maintainable and complainant is thus entitled to the reliefs as claimed by her.  Hence it is so ordered;

                                              ORDER

Case is decreed on contest against O.Ps  who are found to be jointly and severally liable here in this case.  The O.Ps are thus directed to pay the assured sum of Rs.4,55,000/- of policy bearing No. 03151465 to the complainant alongwith 8% interest thereon from the date of repudiation i.e. 23.11.2017 till the final payment is made.  The O.Ps are also directed to pay the complainant a sum of Rs.50,000/- towards compensation for her mental agony and harassment and a further sum of Rs.20,000/- towards the cost of her litigation.  This order is to be carried out within a period of 30 days from the date of receipt of this order.

Order pronounced in the open court on the 1^st day of November,2023 under the seal and signature of this Commission.         

                                                                                     Sri Debasish Nayak

                                                                                           President

                     

                                                                                                              

                                                                                        Sri Sibananda Mohanty

                                                                                           Member