Delhi

StateCommission

A/10/18

POST MASTER GENERAL - Complainant(s)

Versus

KABOOL DEVI - Opp.Party(s)

19 Jan 2016

ORDER

IN THE STATE COMMISSION : DELHI

(Constituted under Section 9 of the Consumer Protection Act, 1986)

Date of Decision: 19.01.2016

First Appeal No - 18/2010

(Arising out of the order dated 28.10.2009 passed in Complaint Case No. 1276/2007 by the District Consumer Disputes Redressal Forum, Barracks, Kasturba Gandhi Marg, New Delhi)

 

In the matter of:

                                            

The Chief Post Master General,

Delhi Circle, MeghdootBhawan,

New Delhi.                                                                                                      …..........Appellant

Versus

                                                                                       

Kabool Devi

W/o Late ShriUdai Singh,

Vill. & Post – Ujwa,

Najafgarh,New Delhi.                                                                         ….....Respondent

CORAM

Justice VeenaBirbal, President

OP Gupta, Member(Judicial)

 

1.     Whether reporters of local newspaper be allowed to see the judgment?

2.      To be referred to the reporter or not?

 

Justice VeenaBirbal, President

1. This is an appeal u/s 15 of the Consumer Protection Act (in short, ‘the Act’ ) wherein challenge is made to order dated 28.10.2009 passed in Complaint Case No.1276/07 by the Consumer Disputes Redressal Forum-New Delhi ( in short,“the District Forum”)
2. The facts leading to the filing of present appeal are as under:

Respondent herein i.e. Complainant before the District Forum had filed a complaint u/s. 12 of the Act stating therein that her husband Sh. Udai Singh was working as a postman with the appellant/OP.  On 30.03.2006 respondent’s husband had applied for a Postal Life Insurance for a sum of Rs.3 lacs till the maturity age of 60 years at a premium of Rs.5385/- per month. On 02.05.2006 proposal was accepted and appellant/OP had issued a letter of acceptance informing that risk of his life had been insured w.e.f. 30.03.2006. On 22.5.2006, Postal Life Insurance policy was issued in the name of her husband with the name of respondent/complainant as a nominee. On 02.11.2006 the husband of respondent/complainant had expired due to sudden ailment. The respondent/complainant being nominee had preferred a claim with appellant/OP. However, the claim was repudiated vide letter dated 14.09.2007 wherein it was alleged that her husband i.e. insured had concealed material facts about his ailment in the proposal form at the time of taking policy, as such the policy was void.  The respondent/complainant gave a legal notice for review of the repudiation letter and had informed that her husband had not concealed any material fact as was alleged. However, no response was received.  Ultimately, she had filed the aforesaid consumer complaint wherein a prayer was made for award of Rs. 3 lacs with interest @18% till realisation along with compensation and cost of litigation.

3. The claim was opposed by the appellant/OP by filing written statement wherein it was stated that husband of respondent/complainant had procured Postal Life Insurance No. DL/80531-P for Rs. 3 lacs on submission of proposal form dated 30.03.2006. The proposal was processed by appellant/OP on the information furnished by the insured. After the death of the insured on 2.11.2006, his nominee i.e. respondent/complainant preferred the claim. On processing the claim which was premature one (below 3 years) it was ascertained through medical certificates submitted by the insured prior to obtaining the said insurance policy that he was a patient of NHL(Non Hodgkin’s Lymphoma), a cancer of the lymphoid tissue. It was alleged that insured had concealed the said fact at the time of taking the policy which had rendered the policy void under the terms and conditions of the policy.  It was alleged that the respondent/complainant was not entitled for any claim amount from the appellant/OP. 
4. Both the parties had filed evidence in the form of affidavits before the Ld. District Forum. After hearing the counsels of the parties, the Ld District Forum had held that documents furnished by the appellant/OP did not show any material that insured was aware of the disease or that he did not intentionally disclose the same while obtaining the policy.  It was held that from leave record relied upon by the appellant/OP it could not be said that insured was suffering from cancer.  Accordingly, the District Forum directed the appellant/OP to pay Rs. 3 lacs to the respondent/complainant being nominee of the insured, Rs.40,000/- has been awarded as compensation and Rs.10,000/- towards the cost of litigation.
5. Aggrieved with the aforesaid order present appeal is filed.
6. Ld. Counsel for appellant has contended that the finding of the District Forum that the insured was not aware about alleged disease is contrary to the material on record. It is contended that insured had deliberately given wrong declaration in the proposal form. It is submitted that while working with the appellant/OP the insured had availed leave number of times. Along with leave applications the insured had submitted medical certificates.  It is contended that in three/four medical certificates issued by Safdarjung Hospital as well as one by U.K. Nursing Home, it is mentioned that insured was suffering from NHL. It is contended that said documents have been ignored by the Ld. District Forum while giving the finding. It is contended that there is concealment of material facts by the insured about his ailment which he was aware at the time of taking the policy.  It is contended that due to concealment of material facts, the policy was void under Rule 7 of Post Office Insurance Fund as well as under the terms and conditions of policy.
7. On the other hand, Ld. Counsel for the respondent/complainant has contended that the insured was not suffering from any ailment as is alleged. There is no concealment of material facts on his part as is alleged. It was alleged that the insured was not aware that he was suffering from NHL i.e. cancer till he was alive.  Even in grounds of appeal, it is stated so.  It is contended that the Ld. District Forum has considered the entire material on record and thereafter passed the impugned order.  It is contended that impugned order is legal and valid and no interference is required.
8. We have considered the submissions made and gone through material on record.
9. It is admitted position that husband of the respondent/complainant had taken Postal Life Insurance on 30.03.2006 for a sum of Rs. 3 Lacs. It is also not disputed that he had died on 02.11.2006. The Respondent’s/complainant’s case is that her husband had died on account of sudden ailment. On the other hand the case of appellant/OP is that before taking policy, insured was a patient of NHL i.e cancer and was aware of the said fact and had not disclosed the same in the proposal form which amounts to concealment of material facts. It is contended that aforesaid concealment has rendered the policy void and respondent/complainant is not entitled for any benefit of insurance.
10. To substantiate its stand, appellant/OP has relied upon proposal form, medical certificates annexed with leave applications of the insured. The Proposal Form filled by the insured for taking the Postal Life Insurance is dated 30.3.06. The relevant portion of the same is reproduced below:

 

        “16.   Personal History:

1.           Are you at present in sound health    .................Yes              
2.         Have you ever suffered from any of the following?
   1. Tuberculosis  (ii) Cancer (iii) Paralysis (iv) Insanity (v) Any diesease of the heart and lung (vi) Kidney disease (vii) Any disease of brain (viii) Diabetes (ix) Hypertension (x) Any other serious desease (xi) Any physical deformity or handicap (xii) HIV / AIDS

            No

 

For all applicants: I hereby declare that I am in good health and free from disease, that I have not ­been any serious illness or major operations for the last Three years and that no proposal of insurance on my life as ever adversely treated.”

11. The medical certificate issued to insured by Medical Officer, Safdurjang Hospital where it is stated that period of absence from duty for 28 days w.e.f. 1.6.05 to 28.6.05 is necessary shows that the insured was suffering from NHL. The medical certificate dated 25.7.05 issued by Medical Officer, Safdarjang Hospital where it is stated that the period of absence from 29.6.05 to 28.7.05 is necessary shows that insured was suffering from NHL. There is another medical certificate dated 14.11.05 issued in favour of insured by Medical Officer of Safdarjang Hospital where it is stated that period of absence from 29.10.05 to 17.11.05 is necessary also shows that insured was suffering from NHL. All the aforesaid certificates bear the signatures of insured also.  The same were furnished by insured for obtaining leave for different periods while working with appellant/OP. The leave record and medical certificates are produced in the evidence before the Ld. District Forum as Ex-DW/II Colly.
12. The aforesaid medical certificates clearly show that the insured was suffering from NHL (Non Hodgkin’s Lymphoma), a cancer of lymphoid tissue.  The insured had applied for Postal Life Insurance on 30.3.06.  All the aforesaid medical certificates are prior to the aforesaid date wherein the specific disease is mentioned.  The insured has also signed the aforesaid medical certificates.  The aforesaid documents have not been challenged by the respondent/complainant either before Ld. District Forum or before us. The evidence on record clearly establishes that the insured was suffering from NHL (Non Hodgkin’s Lymphoma) i.e. a cancer of lymphoid tissue and had concealed the material fact of his ailment while taking the insurance policy.  Despite having the knowledge that he was suffering from cancer, wrong declaration is given in the proposal form about his health status.  Even a specific question is mentioned in the proposal form under the heading “Personal History” about having suffered from certain ailments including cancer.  The insured had answered the same in negative.  The Ld. District Forum has not considered the aforesaid documents while deciding the consumer complaint though the same were placed on record by appellant/OP before the Ld. District Forum. By producing the aforesaid documents, onus is discharged by the appellant/OP in proving that the insured was suffering from NHL, a cancer of lymphoid tissue and was aware of the said fact and had intentionally concealed the said fact at the time of filling the proposal form.
13. Reading the proposal form, it is clear that the complainant had concealed the material fact about his ailment and health from the appellant/OP. 
14. Clause 10 of terms of contract in respect of Postal Life Insurance renders the policy void if the statement and declaration made in the policy are found untrue.  The same is reproduced as under:

“FORFEITURE IN CERTAIN EVENTS: The policy shall be void and the payments made by the insurant shall be forfeited, if the statement contained in the proposal and declaration made therein are found to be untrue.”

15. The contracts of insurance are contracts of uberrima fides and every material fact is required to be disclosed. In United India Insurance Co. Ltd. v. M.K.J. Corpn., III (1996) CPJ 8 (SC), a two-Judge Bench of Hon’ble Supreme Court has observed:

“It is a fundamental principle of Insurance law that utmost good faith must be observed by the contracting parties. Good faith forbids either party from concealing (non-disclosure) what he privately knows, to draw the other into a bargain, from his ignorance of that fact and his believing the contrary. Just as the insured has a duty to disclose, ‘similarly, it is the duty of the insurers and their agents to disclose all material facts within their knowledge, since obligation of good faith applies to them equally with the assured’.”

16. In Satwant Kaur Sandhu vs New India Insurance Company reported in IV (2009) CPJ 8 (SC) wherein it is observed that in a contract of insurance, the expression “material fact” is to be understood in general terms, to mean as any fact which would influence the mind of a prudent Insurer, in deciding whether to accept the risk or not. If the proposer has knowledge of such fact, he is obliged to disclose it, particularly while answering questions in the proposal form. Any inaccurate answer will entitle the Insurer to repudiate its liability because there is clear presumption that any information sought for in the proposal form is material for the purpose of entering into a contract of insurance, which is based on the principle of utmost faith – uberrima fides. Good faith forbids either party from non-disclosure of the facts which the party privately knows, to draw the other into a bargain, from his ignorance of that fact and his believing the contrary. It has also been  emphasized  that  it  is  not  for  the  proposer  to   determine whether the information sought for is material for the purpose of the policy or not.
17. Relying upon aforesaid judgement and other decisions of Hon’ble Supreme Court on the subject, the National Commission in Kokilaben Narendrabhai Patel vs Life Insurance Corporation of India IV 2010 CPJ 86 (NC), Life Insurance Corporation of India vs Gulab Singh Chauhan III (2015) CPJ 194 (NC) & Monica Jain vs Life Insurance Corporation of India 2015 (3) CPR 355 (NC)  has held repudiation by insurer justified where insured had suppressed material facts/made misstatements about his health conditions in the proposal form.
18. In the present case, the documents discussed above clearly establishes that the insured had concealed about his health condition in the proposal form.  The insured had failed to disclose that he was suffering from NHL (Non Hodgkin’s Lymphoma) i.e. a cancer of lymphoid tissue while giving the proposal form though a specific question in this regard was put to him.  There was clear supression of material fact with regard to his health.  The Ld. District Forum while passing the impugned judgement has ignored the material evidence.  The appellant/OP was justified in repudiating the claim of insurance.
19. In view of the above discussion, we allow the appeal and set aside the impugned judgement passed by the Ld. District Forum and dismiss the CC No 1267/07.  There is no order as to cost.
20. A copy of this order as per the statutory requirement be forwarded to the parties free of charge and also to the concerned District Forum. The record of the District Forum be sent forthwith. Thereafter the file be consigned to Record Room.

 

 

                                                                       (Justice VeenaBirbal)

President

 

(OP Gupta)

Member(Judicial)