O R D E R Sri. Santhosh Keravanath. P., President. Case of the petitioners is as follows: The husband of the first petitioner and father of the other petitioners joined in chitty with the opposite parties. The chitty No. is 5/04 Chittal No. 47, the sala is Rs. 1 lakh on 5..11..2004 the petitioner priced the chitty. According to the petitioner due to the wilfull latches on the part of the opposite party the price money was received to the -2- petitioner only on 20..6..2005. According to the petitioner the opposite parties compelled said Prabhakaran to join an insurance scheme by paying Rs. 100/- as premium. On 31..10..2005 the husband of the first petitioner and the father of the other petitioner, Prabhakaran, died at the age of 64 years. The petitioners states that the deceased Prabhakaran had discontinued from school education in the lower class itself. He had given his signature in blank variyola and the officers of the opposite party filled up the variyola. The petitioner states that as per the conditions in their letter it is specifically stated that as per the said scheme in case of natural death or accidental death or total disability further liability with regard to the chitty shall be waived and the balance insurance amount shall be paid to the subscriber/ legal heir. Petitioner states that the case of the petitioners even after repeated requests opposite parties had not paid the insured amount of Rs. 1,00,000/- to the petitioners. The said act of the opposite party of rejection of the application of the petitioners on the ground that deceased crossed age of 65 years is an unfair trade practice and the clear deficiency of service on their part. So the petitioners prays for waiver of the liability of the petitioner. The petitioner claims an amount of Rs. 1,00,000/- as compensation for the mental agony caused to them and also they pray for refund of the amount of Rs. 7,941/- it is remitted by the petitioners. The opposite party filed version contenting that the petition is not maintainable and the petitioner is not entitled for reliefs sought for. The opposite party admitted that the deceased Prabhakaran has joined in chitty No. 5/04, chittal No. 47 run by the second opposite party. The monthly instalment of the chitty is Rs. 2000/- and the sala is Rs. 1,00,000/-. Duration of the chitty is 50 months. The chitty commenced on 13..2..2004 -3- and termination of chitty is on 4..3..2008. The opposite party contented that deceased Prabhakaran price the chitty on 4..10..2004 and the price money of Rs. 68,915 was deposited in FD as per request of the subscriber. Subsequently on submission of personal sureties the price money was released and there was no wilful fault or latchs on the part of the employees of the opposite parties in disbursing the amount. The opposite party denied the allegation of the petitioner that the deceased was compelled to join the insurance scheme. According to the opposite party as and when the scheme was introduced the terms and conditions of the chitty liability waiver scheme made known to all subscribers. By understanding the full terms and conditions subscribers joined in that scheme. They contented that the deceased Prabhakaran joined in the above said scheme voluntarily by remitting Rs. 100/- on 20..6..2005 by fully understanding the terms and condition of the scheme. They contented that in the 333rd board meeting held on 9..3..2004 opposite party decided to accept liability waiver scheme for chitty subscribers who died after pricing the chitty only if the chitty is up-to-date in remittance as on the date of the death of the sbscriber, had he will be alive, would not have crossed 60 years of age on the normal date of termination of chitty. The opposite party introduced that scheme with effect from 1..4..2004. Since the s cheme thus introduced caused many problems, opposite parties put a modified proposal in its 343rd board meeting held on 12..4..2005. As per the modified scheme introduced on 1..5..2005 the petitioner remitted Rs. 100/- for becoming a member of that scheme. According to the opposite party the petitioner handed over a signed thalavariyola to the second opposite party were in he had stated his age as 60 at that time. The date of chitty terminated on 4..3..2008. Since the -4- subscriber has declared his age as 60 years the opposite parties allowed him to join in the scheme on a bonafide belief that as on the date of termination of the chitty his age would only 64 . After the death of the subscriber, opposite party asked the petitioner to submit the birth certificate of the dieceased. From the death certificate produced, it reveals that while enroling in the chitty, the correct date of birth was suppressed by the subscriber and at the time of enrolment he was 64 years. So the opposite party contented that there was no deficiency in service with regard to the rejection of the claim of the petitioner. So, according to opposite party the petition is to be dismissed with their costs. Points for determinations are: i) Whether there is deficiency in service on the part of the opposite party? ii) Reliefs and costs. Evidence in this case consists of Ext. A1 to A6 on the side of the petitioner and Ext. B1 to B7 documents on the side of the opposite party. Point No. 1 The petitioner produced a letter issued by the opposite parties to the deceased Prabhakaran and said document is marked as Ext. A6. In Ext. A6 there is no condition specified showing that the subscriber should not complete 65 years at the time of termination of chitty. If there is such a condition it is very material and an essential fact with regard to the scheme. From Ext. A6 it can be seen that the opposite party is conducting an insurance scheme named Swanthanam. Since it is an insurance scheme, as the Supreme Court decided in M/s. Modern Insuleters Ltd. Vs. Oriental Insurance Company reported in AIR 2000 Sc page 1014 the Hon'ble Supreme Court in the said case -5- stated that, it is duty of both parties to disclose of the fact, exclusion clause etc. If it is not disclosed it will neither form a part of the contract of insurance and the insurer cannot claim benefit of exclusion clause. Keeping reliance on the said decision we are also of the opinion that it is the fundamental principle of insurance law that at most good faith must be observed by the contracting parties. Good faith for bids either party from non disclosure of the fact which the parties know. The insured has a duty to disclose and similarly it is the duty of the insurance company to disclose all material facts in their knowledge and the obligation of good faith applies to both equally. In the instant case the terms and conditions of policy was not disclosed to the insured, thus the insurer can not claim the benefit of the scheme of said exclusion clause. Further more KSFE is only a financial institution managed by the government as a public limited company. They have no power for making a statute or rules in binding nature to the public. The opposite party produced the variyola with regard to the chitty and said document is marked as Ext. B2, variyola is a statutory document as per the Kerala Chities act 1975,In Ext. B2 no specific condition with regard to the insurance coverage is mentioned and further more we are of the opinion that the board meeting of the opposite party and the circulers issued by the KSFE are not binding on the decease Prabhakaran or his legal heirs. The counsel for the petitioner relied on a Supreme Court decision reported in 1987 S.C.C 654 Skandia Insurance Company Ltd. Vs. Kokila Ben Chandravatan the honble Supreme Court in the said case stated that in case of ambuguity or doubt with regard to policy it should be interpreted in favour of the insured and against the company and -6- further the Supreme Court held that exclusion clause should be read in light of main purpose or in otherwise the exclusion clause does not cross swords with the main purpose. The petitioner produced the copy of admission register and said documents was marked as Ext. A1. From Ext. A1 it can be seen that the deceased Prabhakaran was terminated from the roll of the school register due to long absence. Ext. A1 shows that diseased Prabhakaran had no school education and was unable to read and write. So, it is much probable the case of the petitioner that Ext. B2 document was not filled by Prabhakaran. From the records available it can be seen that the only document with regard to the conditions of the scheme made available to public at time of the scheme is Ext. A6 documents. So, on the above finding we are of the opinion that the rejection of the application filed by the petitioner is not proper and is aclear deficiency of service. So, point No. 1 is found accordingly. Point No. 2 In view of finding in point No. 1, petition is to be allowed and petitioner is entitled to reliefs sought for. In the result, the opposite party is ordered to give the insurance amount with regard to the deceased Prabhakaran to the petitioner. The opposite party is ordered to waive the balance amount with regard to the chitty of late Prabhakaran. The opposite party is directed to refund an amount of Rs. 7941 which is remitted by the petitioner after the death of Prabhakaran. Since there is no evidence with regard to loss and sufferings no compensation is ordered. The petitioner is also entitled for an amount of Rs. 2,000/- as -7- cost of the proceedings. Order shall be complied with within 30 days of receipt of order. Dictated by me transcribed by the Confidential Assistant corrected by me and pronounced in the Open Forum on this the 29th day of August, 2008.
......................Bindhu M Thomas ......................Santhosh Kesava Nath P
Consumer Court Lawyer
Best Law Firm for all your Consumer Court related cases.
