1.      The present Revision Petition has been filed by the Petitioner under Section ­­­21(b) of the Consumer Protection Act, 1986 (the “Act”) against impugned order dated 15.10.2015, passed by the learned State Consumer Disputes Redressal Commission, Rajasthan, Jaipur, (hereinafter to be referred as the ‘State Commission’) in FA No.19/2015, whereby an Appeal filed by the OP (Petitioner herein) was dismissed and affirmed/upheld the Order dated 14.11.2014, passed by the District Consumer Disputes Redressal Forum, Jaipur-II, Jaipur (the “District Forum”) in Consumer Complaint No.755 of 2012.

2.      For convenience, the parties are referred to as stated in the original Complaint filed before the District Forum. Imran Khan referred to as the Complainant who is the nominee of his father namely Late Bholu Khan and Life Insurance Corporation of India is referred to as the Opposite Party/Insurer/OP.

3.      Brief facts, as per the Complainant, are that the Complainant's father had obtained policy from the OP for sum assured of Rs.2 Lakhs on 23.09.2009.  Suddenly, the father of the complainant Bholu Khan expired on 20.09.2011. The Complainant lodged the claim before the Insurer. However, the OP repudiated the claim of the complainant on the ground of suppression of the pre-existing disease, i.e. T.B. at the time of taking of the Policy in question, which is violation of the terms and conditions of the Insurance Policy. Being aggrieved, he filed Complaint No. 755 of 2012, seeking claim of sum assured Rs.2 Lakhs from the OP, along with premium paid, compensation.

4.      In reply, the OP denied the allegations of the Complainant and contended that the suppression of pre-existing disease is a fundamental breach of the policy and therefore, the OP was justified in repudiating the claim of the Complainant. Therefore, the OP maintained that no deficiency in service had occurred, warranting the dismissal of the Complaint.

5.      The learned District Forum vide Order dated 14.11.2014, allowed the complaint with the following Order:

“ORDER

“Therefore the complaint of the complainant against the opposite party is allowed.  The opposite party is directed to make payment to the complainant insurance claim of Rs.2 Lakh and interest thereon @ 9% p.a. from 01.01.2012 till its realization.  Besides it Rs.5,000/- for mental sufferings and Rs.2,000/- on account of expenses of complaint shall also be paid to the complainant.”

(Extracted from True Translated Copy)

6.      Aggrieved by the District Forum order, the OP/Insurer filed an Appeal and the learned State Commission vide order dated 15.10.2015 dismissed the Appeal and upheld the Order of the District Forum with the following findings: -

  “In the facts and circumstances of this case, it is not disputable that the insured was an illiterate person and he barely managed to sign in Hindi. The proposal form was filled in by the agent. Though the agent Ramesh Chand Sharma has declared on the proposal form that all the contents had been explained to the insured but no affidavit of Ramesh Chand Sharma has been filed by the opposite party. It is a common knowledge that insurance agents are eager to get the insurance proposal through, as the agents get a substantial amount of commission in the first premium. The agents are engaged by the LIC to procure business and are given requisite training for this purpose also. There is every possibility that the insurance agents in order to obtain business and to earn more money by way of commission do not disclose all the facts to the illiterate insurers and the insurance company accepts the proposal on their declaration and ultimately the legal representatives of the deceased suffer for their negligence and dereliction of duty.

Even in this case if we presume that insured had disclosed the fact of his illness to the agent, the agent who had knowledge that this may delay the proposal or ultimately lead to rejection on the ground of illness did not enter the fact of previous illness is possible. We cannot apply the same parameters in case of literate and illiterate insured and deceased has no opportunity to rebut the statement of insurer that agent had explained everything to him. An illiterate person cannot verify that the form has been filled as per his directions. It is incumbent upon the insurance company to verify all these facts at the time of accepting the proposal of the illiterate Hindi or in English. The insured can be held responsible only if he had fraudulently suppressed this information at the time of taking the insurance. The fact of fraudulent suppression is not evident on record. While we go through the papers submitted by the insurance company, first time the insured was diagnosed of TB in the year 2006 and on 23.1.2007 he was fully cured as per the record. There was relapse in 2007 occurred on 16.9.2009 which was also fully cured on 14.6.2010 and again a certificate shows that on 30.5.2011 he was also fully cured of this disease. May be in these circumstances the insured had not disclosed since he had been cured after taking the treatment or the agent did not mention it for his own interest. Relying upon the printed and formal declaration of the agent will be wholly unsafe. So there is no evidence on record that he fraudulently suppressed these facts to obtain the insurance.

          In view of this fact we do not wish to interfere with the conclusion arrived at by the learned DCF and the appeal is dismissed.”

7.      Dissatisfied by the Impugned Order dated 15.10.2015, the OP/ Petitioner filed the instant Revision Petition No.330 of 2016.

8.      In his arguments, the learned Counsel for the Petitioner/ OP Insurance Company reiterated the facts of the case and contended that it is amply clear from the proposal forms in Clause 11 of personal history in which the Complainant’s father gave all the answer in negative including hospitalization, diabetes, heart disease, Tuberculosis etc. Therefore, the fora below have totally misinterpreted the documents issued by the hospital, the same has not been denied by the life assured. The letter dated 04.01.2012 sent by the M.O.T.C., T.B. Unit, Chomu, Jaipur, Rajasthan to Mr. R.P. Mourya, Sr. Branch Manager, LIC of India, BO-Chomu, Jaipur which clearly stated that the life assured was suffering from T.B. and he was taking treatment from 16.09.09 to 14.06.2010.  The proposal form was filled and signed by the deceased insured on 23.09.2009. Subsequently, the policy in question was issued on the same date i.e. 23.09.2009.  Thus, it is clear that when the proposal for taking policy was filled and signed by the deceased insured on 23.09.2009 he was taking the treatment of the disease i.e. T.B. from M.O.T.C., T.B. Unit, Chomu, Jaipur, Rajasthan which is clearly suppression of pre-existing disease and violation of fundamental breach of the insurance policy in question.

To support this argument, the counsel placed reliance upon the latest judgment of Hon’ble Supreme Court titled as Reliance Life Insurance Co. Ltd. v. Rekhaben Nareshbhai Rathod, (2019) 6 SCC 175.

9.      In his arguments, the learned Counsel for the Respondent vehemently contended that the State Commission did not commit any jurisdictional error or miscarriage of justice warranting a different view. He relied on Hon’ble Supreme Court order in Mrs. Rubi (Chandra) Dutta vs M/s. United India Insurance Co. Ltd., 2011 (3) SC 654. He further argued that the present Revision Petition was based solely on the contention that the Complainant's father failed to disclose requisite information and suppressed material facts at the time of obtaining insurance policy. The State Commission addressed correct and in detail and finding was concurrent in both across all forums, implying that no new ground was introduced in the current revision petition.

10.    I have examined the pleadings and associated documents placed on record and rendered thoughtful consideration to the arguments advanced by the learned Counsels for both the parties.

11.    The central issue and objection of the Petitioner/ OP Insurance Company is that it had rightly repudiated the claim on the ground of suppression of pre-existing disease at the time of filling the proposal form for taking the insurance policy.

12.    With respect to the said issue, it is relevant to reproduce the Letter dated 04.01.2012 sent to Shri R.P. Mourya, Sr. Branch Manager, LIC of India, BO-Chomu written by M.O.T.C., TB Unit, Chomu (Jaipur) as under:

                                                “T.B. Unit, CHOMU

Sr. No.9                                                                                  4/1/2012

Shri R.P. Mourya

Sr. Branch Manager,

LIC of India,

BO-Chomu

                                                                               Policy No.19774484

Subject: TB patient Bholu Khan S/o Shri Ganni Khan  - treatment

               regarding.

In reference to this office letter ref. Claim/Invest./19y, the treatment of TB(DOTs) of above person Lt. Shri Bholu Khan was taken from PHC, Karansar as detailed under:

Treatment of the patient of TB was completed on 30.05.2011 from Karansar and the patient was cured.  Later on the patient had taken treatment from outside, information of which is not available in our records.  The record of all information regarding treatment is attached along with copy of treatment cards.

                                                                                      Signed

                                                                                          Sd/-

                                                                                      M.O.T.C.

                                                                   TB Unit, Chomu (Jaipur)”

(Extracted from Translated Copy)

13.    It is undisputed that the proposal form was filled and signed by the deceased insured on 23.09.2009. Subsequently, the policy in question was issued on the same date i.e. 23.09.2009. Thus, it is clear that when the proposal form for taking policy was filled and signed by the deceased insured on 23.09.2009 he was taking the treatment of the disease i.e. T.B. from M.O.T.C., T.B. Unit, Chomu, Jaipur, which is clearly suppression of pre-existing disease and fundamental breach of the insurance policy in question. Therefore, the argument of the Petitioner/ Insurer is supported by the legal precedent set forth by the Hon’ble Supreme Court in the case of Reliance Life Insurance Co. Ltd. v. Rekhaben Nareshbhai Rathod, (2019) 6 SCC 175 decided on 24.11.2019 has held that suppression of the facts made in proposal form will render Insurance Policy voidable by the Insurer.

14.    Further, the Hon’ble Supreme Court in Bajaj Allianz Life Insurance Company Ltd. v. Dalbir Kaur, 2020 SCC OnLine SC 848 decided on 09.10.2020 wherein it was observed as under:

“A contract of insurance is one of utmost good faith. A proposer who seeks to obtain a policy of life insurance is duty bound to disclose all material facts bearing upon the issue as to whether the insurer would consider it appropriate to assume the risk which is proposed. It is with this principle in view that the proposal form requires a specific disclosure of pre-existing ailments, so as to enable the insurer to arrive at a considered decision based on the actuarial risk.”

15.     Based on the discussion above, I am of the considered view that Order of both fora below are not legally tenable. There is no doubt to the fact that the Insured i.e. Complainant’s father has failed to disclose his known medical condition in the proposal form. Therefore, the Revision Petition is Allowed and the Orders of both the learned fora are set-aside. Consequently, Complaint No. 755 of 2012 filed before the District Forum is dismissed.

16.    All other pending Applications, if any, stand disposed of.

17.    There shall be no order as to costs.