STATE CONSUMER DISPUTES REDRESSAL COMMISSION HARYANA, PANCHKULA
Date of Institution: 08.05.2019
Date of final hearing: 04.07.2023
Date of pronouncement: 16.08.2023
First Appeal No.454 of 2019
IN THE MATTER OF:-
Usha Devi, aged about 36 years, Wd/o Sh. Randhir Singh S/o Sh. Ratti Ram, R/o V.P.O. Sirta, Tehsil and District Kaithal.
....Appellant
Versus
- The Branch Manager, LIC of India, Near Geeta Bhawan Mandir, Kaithal.
- Divisional Manager, LIC of India, Karnal, “Jeevan Parkash” 489, Model Town, Karnal.
…..Respondents
CORAM: Naresh Katyal, Judicial Member
Argued by:- Sh. Chiranji Lal, counsel for the appellant.
Ms. Vandana Malhotra, counsel for respondents.
ORDER
NARESH KATYAL, JUDICIAL MEMBER:
Challenge in this appeal No.454 of 2019 has been invited by complainant-Usha Devi to the legality of order dated 26.03.2019 passed by District Consumer Disputes Redressal Forum-Kaithal (In short “District Consumer Commission”) in complaint case No.137 of 2018 vide which her complaint has been dismissed.
2. Randhir Singh-complainant’s husband had obtained policy No. 176169696 on 28.07.2008. Sum assured was Rs. 2,00,000/-. Policy was to be matured in July, 2028. It is pleaded that life assured was paying installments regularly, and last installment was paid on 01.07.2017. Policy-holder died on 12.07.2017 due to sudden heart failure. Intimation regarding his death was given to Ops. Complainant, being nominee, under policy lodged death claim with Ops and submitted necessary documents. Her claim was denied/repudiated by OPs vide letter dated 04.12.2017. By alleging deficiency in service on the part of Ops, she filed complaint.
3. Upon notice, OPs raised contest. In defence; preliminary objections regarding locus-standi; maintainability cause of action, jurisdiction were taken. It has been pleaded that complainant has concealed true and material facts. Policy in question was in lapsed condition. It was got revived on 28.07.2016 by paying 5 half-yearly installments of premium due from July-2014 to July-2016 on the basis of DGH (Declaration of Good Health) from, dated 28.07.2016 and in the said form; deceased gave wrong answers regarding his health, as before revival of policy, deceased-life assured was suffering from Type-II Diabetes Mellitus & Necrotizing Fasciitis, commonly known as flesh eating disease. He remained admit in Shah Hospital-Kaithal w.e.f. 10.08.2012 to 15.08.2012 and also had OPD follow-up till 01.09.2012 for above-mentioned diseases. It is pleaded that life assured was having knowledge about his illness, admission and treatment in hospital, but concealed these facts from Ops and got revived policy for said purpose knowingly and fraudulently by giving false information in DGH form dated 28.07.2016. It is pleaded that repudiation of claim is legal and valid and there is no deficiency in service on the part of OPs. On merits, it is pleaded that relevant Form No. 3816 was demanded from complainant to process the claim for admission of life assured in Shah Hospital-Kaithal from 10.08.2012 to 15.08.2012, but this form was submitted incomplete with remarks “No record of patient was found as per hospital record.” In Form No. 3783 & 3784; the nominee/complainant has stated that: “No treatment was taken by any doctor.” During investigation; treatment card/discharge summary of Shah Hospital-Kaithal was procured, as per which, life assured was not having good health and was suffering from Type-II Diabetes Mellitus & Necrotizing Fasciitis, for which he remained admit in this hospital from 10.08.2012 to 15.08.2012 and was OPD follow-up till 01.09.2012, but this fact was not disclosed by life assured in DGH Form dated 28.07.2016. Inter alia on these basic pleas; dismissal of complaint has been prayed.
4. Parties to this lis led evidence, oral as well as documentary.
5. On subjectively analyzing the same; learned District Consumer Commission-Kaithal vide order dated 26.03.2019 has dismissed the complaint.
6. Feeling aggrieved; complainant has filed this appeal.
7. Learned counsel for parties have been heard at length. With their able assistance; record too has been perused.
8. Learned counsel for the complainant/appellant has urged that reasoning adopted by learned District Consumer Commission is erroneous, legally as well as factually. There has been no concealment of any material fact by life assured, at the time of revival of insurance policy on 28.07.2016 regarding his state of health, while submitting DGH Form. Repudiation of claim, by OPs, in that scenario was totally unjustified which, as per contention, smacks out deficiency in its (OPs) services. It is urged that: had, life assured been suffering from any ailment, then OPs should not have revived the insurance policy on 27.08.2016, once it was already lying lapsed, due to non-payment of premium. It is urged that document Ex.R-7of Shah Hospital-Kaithal, relied upon by OPs has no concern with deceased-husband of complainant, particularly when OPs have pleaded in Para No. 6 of its written statement on merits that: no record of patient was found as per hospital record. It is urged that: it is quite mysterious, as to how, document Ex.R-7 was procured and produced in evidence, by OPs. On above submissions; learned counsel appearing for complainant/appellant has urged for acceptance of appeal.
9. Per contra, learned counsel for respondent/OP has supported the impugned order dated 26.03.2019 passed by learned District Consumer Commission-Kaithal by urging that it is outcome of proper appreciation of facts and evidence. It is urged that there had been active concealment of material facts (pre-existing ailments), by life assured, while submitting DGH (Declaration of Good Health Form) dated 28.07.2016 for revival of his already lying lapsed policy, by paying five half yearly installments due from July-2014 to July-2016. It is urged that repudiation of claim by OPs is legally justified.
10. Admittedly, Insurance Policy No. 176169696 dated 28.07.2008 was obtained by complainant’s husband, in which, complainant was nominee. Sum assured was Rs. 2,00,000/-. This policy was lying in lapsed condition. It was got revived on 28.07.2016 by paying five half yearly installments of premium due from July -2014 to July-2016. This revival was based on life assured’s recitals mentioned in Declaration of Good Health (DGH) Form dated 28.07.2016. Revival Proposal Form is Ex.R-12. Deceased-life assured (Randhir Singh) conveniently, rather as per own wisdom, had given negative answers to questions regarding his health status in the DGH Form dated 28.07.2016. Before revival of policy, deceased was already suffering from Type-II Diabetic Mellitus and Necrotizing Fasciitis, commonly known as: flesh eating disease. He remained hospitalized in Shah Hospital-Kaithal from 10.08.2012 to 15.08.2012. This hospitalization of Randhir Singh was almost four years (3 years and about 11 months) prior to revival of policy. Hence, deceased life assured must had been carrying every knowledge about nature of his disease, prior period of hospitalization, at the time when he filled DGH Form on 28.07.2016 to get revive his lapsed policy. Still, by giving negative answers (No) with respect to specific questions in the DGH Form; the life assured had actively concealed material facts which would disentitle him to any equitable relief. At legal pedestal, life assured cannot wriggle out from legal import and ramifications flowing from his negative answers. He had himself run into peril as Necrotizing Fasciitis, commonly known as: flesh eating disease carries dangerous infection. Medically, it defines “a serious bacterial infection that destroys tissues under the skin. It is commonly caused by group A Streptococcus (GAS) bacteria”.
11. Learned counsel for appellant has vehemently argued that two different situations have been created by insurer. Firstly, there is an express stand taken in the defence by OPs (Para 6 of written statement) that: no record of patient is found in hospital, and on this recital, which is mentioned in document Mark C-D; there appears signatures of Dr. M.S. Shah. Secondly, insurer is simultaneously relying upon document Ex.R-7 which is also of Shah Hospital and which recites that patient named Randhir was admitted on 10.08.2012 and discharged on 15.08.2012. He was suffering from Type-II Diabetic Mellitus and Necrotizing Fasciitis. Learned counsel has urged that in above scenario document Ex.R-7 does not belong to deceased/life assured-Randhir Singh.
12. Above contention carries no weight. Reasons are obvious. Document Mark-CC is the letter dated 17.10.2017 written by LIC to Usha Devi conveying her: (a) deceased was hospitalized in Shah Hospital-Kaithal from 10.08.2012 to 15.08.2012; (b) enclosed form No. 3816 be got filled from Shah Hospital and be sent immediately for enabling further action. It is in this context that document Mark-CD was submitted with LIC with remarks “No record of patient was found as per hospital record”. Meaning thereby, OPs, in its written statement, were only stating; what complainant has procured and submitted to it. OPs investigation had begun only hence after. Therefore, even if, at one stage it has been mentioned that no record of patient is found in hospital, yet it will not preclude and curtail the right of insurer/OPs to subsequently rely upon any document which has majestic concern with patient/life assured Randhir Singh and on which, it (OPs) happened to lay its hand. Secondly, when on 03.01.2019 evidence of insurer was being led and affidavit Ex.RW-1/A of Mr. Ravi Mohan, Manager (Legal), LIC was being tendered along with documents Ex.R-1 to Ex.R-19 then at that time, no objection was raised by complainant, regarding admissibility of document Ex.R-7. Legally, any objection as to admissibility of document in evidence, can be taken at the time when documents is being produced/tendered in evidence. Thirdly, OPs have invoked exclusion clause in their written version. Obviously, it was for OPs to lead positive evidence to prove the credibility of exclusion clause, so invoked. In this scenario, merely because, it has stated in document Mark C-D that: no record of patient has been found in hospital; legal right of OPs to lead substantive evidence to prove its case, so pleaded (relevancy of exclusion clause on the basis document Ex. R-7), would not, stood foreclosed. Reliance in this regard can be placed on record laid down by Hon’ble Apex Court in case titled as “Anil Rishi versus Gurbax Singh, 2006 (2) PLR 775” wherein it has been held as under:-
“There is an essential distinction between the concept ‘burden of proof and onus of proof’. Burden of proof lay upon a person, who has to prove the fact and which never shifts, whereas, onus of proof shifts. Such a shifting of onus is a continuous process in the evaluation of evidence. The elementary rule of Section 101 of Evidence Act is inflexible. In terms of Section 102 of the Evidence Act; the initial burden is always on plaintiff. If the plaintiff discharges that onus and makes out a case, which entitles him to relief, then onus shifts upon the defendant to prove those circumstances, which would dis-entitle the plaintiff to the same.”
13. In view of above ratio of law; OP’s have all legal rights to lead positive evidence, in terms of case set out in written statement to negate the claim of complainant. There is no legal error by OP’s, in present case to produce evidence in form of document Ex. R-7.
14. Hon’ble Apex Court in case titled as General Assurance Society Ltd. Vs. Chandumull Jain and Others AIR 1966 SC 1644, in the context of insurance Act, 1938 has held that: “Court should interpret the words in which contract is expressed by parties. Court should make a new contract if parties have not made it themselves.”
15. In yet another case titled as Vikram Greentech (I) Ltd. and Another Vs. New India Assurance Company Ltd., JT 2009 (5) SC 579 it has been held by Hon’ble Apex Court that: “An insurance contract, is a species of commercial transactions and must be construed like any other contract to its own terms and by itself. In a contract of insurance, there is requirement of uberimma fides i.e. good faith on the part of the insured. Except that, in other respects, there is no difference between a contract of insurance and any other contract. The four essentials of a contract of insurance are, (i) the definition of the risk, (ii) the duration of the risk, (iii) the premium, and (iv) the amount of insurance. Since upon issuance of insurance policy, the insurer undertakes to indemnify the loss suffered by the insured on account of risks covered by the insurance policy, its terms have to be strictly construed to determine the extent of liability of the insurer. The endeavor of the court must always be to interpret the words in which the contract is expressed by the parties. The Court while construing the terms of policy is not expected to venture into extra liberalism that may result in re-writing the contract or substituting the terms which were not intended by the parties. The insured cannot claim anything more than what is covered by the insurance policy.”
16. It is trite to say that wherever such an exclusionary clause is contained in a policy, it would be for the insurer alone to show that the case falls within the purview of such clause. In case of ambiguity, the contract of insurance has to be construed in favour of insured. Reliance in this regard can be placed on judgment of Hon’ble Supreme Court in case titled as “National Insurance Co. Ltd. Vs. Vedic Resorts and Hotels Pvt. Ltd.” (Civil Appeal No.4979 of 2019 decided on 17.05.2023, and also on decision of Hon’ble Apex Court in case titled as “National Insurance Company Limited vs. Ishar Das Madan Lal” (2007) 4 SCC 105.
17. While applying the legal dictum of afore cited judgments to the facts of this appeal, “it is held that insurer/OPs have succeeded in bringing on record cogent and tangible evidence, to prove its pleaded fact that life assured/beneficiary (Randhir Singh) had pre-existing aliments, prior to reviving his policy on 28.07.2016 and his ailments were dating back to year 2012, and there has been active concealment of above material fact and the part of complainant.
18. Ratio of law laid down in judgments cited above would also lead this Commission to conclude that: every fact of materiality, must be disclosed, otherwise there is good ground for rescission. While applying above cardinal principle of law to the facts of this case it is held that: life assured Randhir Singh had got revived his policy on 28.07.2016. He died on 18.10.2017 i.e. after more than one year and two months of revival of his policy. Before getting his policy revived, he was already suffering from ailments of nature and type Type-II Diabetic Mellitus and Necrotizing Fasciitis which was having direct nexus to his health to deteriorate in due course. In wake of above facts and evidence, OPs cannot be found faulty to repudiate the death claim to complainant, who was life assured’s nominee, vide its letter dated 04.12.2017-Ex.C-4/Ex.R-1. It is apparent from impugned order of District Consumer Commission that OPs had already paid Rs.60,800.00 - surrender value of policy on 24.05.2018. There is absolutely no deficiency in service on the part of OPs. Complainant has been rightly non-suited. There is no illegality in the impugned order dated 26.03.2019 passed by District Consumer Commission-Kaithal. It is affirmed and maintained. Present appeal, being devoid of merits, is hereby dismissed.
19. Application(s) pending, if any stand disposed of in terms of the aforesaid judgment.
20. A copy of this judgment, be provided to all the parties free of cost as mandated by the Consumer Protection Act, 1986/2019. The judgment be uploaded forthwith on the website of the Commission for the perusal of the parties.
21. File be consigned to record room.
Date of pronouncement: 16th August, 2023
Naresh Katyal
Judicial Member
Addl. Bench-II
