BEFORE THE DISTRICT CONSUMER FORUM :: WARANGAL
Present : Sri D. Chiranjeevi Babu,
President.
And
Patel Praveen Kumar,
Member.
Wednesday, the 21stday of June, 2011.
CONSUMER COMPLAINT No.150/2008
Between:
1) Challagonda Vijaya laxmi,
W/o late Bhaskar Reddy,
Age: 39 yrs, Occ: Household.
2) Challagonda Vikram Reddy,
S/o late Bhaskar Reddy, Minor,
Occ: Student.
3) Challagonda Vinesh Reddy,
S/o late Bhaskar Reddy, Minor,
Occ: Student.
Complainants 2 and 3 being minors, through
Their next friend and natural mother i.e.,
Complainant No.1
All are R/o H.No.4-4, Gopalapuram Village
Via-Thogarrai Village, Duggondi Mandal
Warangal District.
… Complainants
And
The Life Insurance Corporation of India,
Rep. by its Branch Manager,
Branch Office, Narsampet,
Warangal District.
… Opposite Party
Counsel for the Complainants :: Sri G.Rajendra Prasad, Advocate.
Counsel for the Opposite Party :: Sri K.S.Raju, Advocate.
This complaint is coming for final hearing before this Forum, the Forum pronounced the following order.
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ORDER
Sri D. Chiranjeevi Babu, President.
This complaint is filed by the complainants Ch.Vijaya Laxmi and her children against the opposite party under section 12 of Consumer Protection Act, 1986 for a direction to pay the policy amounts of Rs.7,31,000/- under the policy bearing NOs.686716201 and 687082747 together with future interest @12% p.a. from the date of filing of the case to its full realization, to pay Rs.50,000/- towards damages and costs.
The brief averments contained in the complaint filed by the complainants is as follows:
The case of the complainants is that the complainant No.1 is the wife and complainants 2 and 3 are minor children of late Bhaskar Reddy who died on 09-03-2007. During his life time the deceased Bhaskar Reddy obtained policy No.686716201 for Rs.1,50,000/- on 25-07-2003 and another Policy bearing No.687082747 for Rs.1,00,000/- on 28-08-2004 from opposite party and paid the premiums regularly till his death. For both the policies the complainant No.1 is the nominee. After the death of the deceased, as nominee, the complainant NO.1 submitted claim form along with original policy bonds duly filled in all respects to the opposite party. The opposite party dodged the matter without settling the claim under the above policies. The complainant got issued legal notice to opposite party on 27-08-2008, for which no reply is received. The acts of opposite party amounts to deficiency of service. Hence, filed this complaint praying to direct the opposite party to pay Rs.7,31,000/- under the above 2 policies with interest, damages and costs.
The opposite party filed the Written Version stating that it is true the deceased Bhaskar Reddy had taken two policies from the opposite party. The two policies were lapsed for failure of premia by the deceased life assured, Policy No.686716201 was revived on 14-02-2006 and Policy No.687082747 was revived on 28-11-2005. As per the intimation given by the complainant that the life assured died on 09-03-2007 as the death occurred within two years from the date of revivial of the policy, which is a Denovo Contract treating the claims under both the above policies as Early as per rules the opposite party conducted investigation. During the said investigation it came to light that the deceased life assured had suffered with and taken treatment for “MULTIPLE LIVER ABSCESS” since 29-12-2001 and was hospitalized at Satya Hospital, Warangal with patient ID No.913/01 admitted on 30-12-2001 and discharged on 03-01-2002.
CC 150/2008 -- 3 --
Further stated that the deceased got revived both the above policies wherein he had not mentioned his previous illness/treatment and declared that he was in sound health at the time of submission of the said personal statements regarding health. If he mentioned the facts the opposite party have called for certain special diagnostic reports and his proposal for insurance, would not have been accepted the subsequent revival also would not have been effected. So the deceased suppressed the material facts and obtained policies, so section 45 of Insurance Act is applicable and requested this Forum to dismiss this case.
The complainants in support of their claim, filed the Affidavit of complainant NO.1 and Affidavits of other (03) witnesses and examined as PW-1 to PW-4. On behalf of opposite party Sri Bhaskar filed his Affidavit in the form of chief examination and also marked Exs.B-1 to B-20. This Forum appointed an Advocate Commissioner to record the evidence of Doctor Bachhu Murali Krishna examined as RW-2.
Now the point for consideration is:
1) Whether there is any deficiency of service on the part of the opposite parties?
2) If so, to what Relief?
Point No.1:-
After arguments of both side counsels our reasons are like this:
The counsel for the opposite party argued that this case is purely comes under suppression of material facts and Section 45 of Insurance Act is applicable. Because the deceased is a LIC Agent and he knows that he attacked Multiple Liver Abcesses and he suffered with the same disease and went to the hospitals for his checkups and he has taken treatment prior to taking two policies by him. Even though he has taken two policies he has not mentioned about his disease in his two proposal forms, so the deceased cheated the insurance and the insurance is not liable to pay anything.
We gone through the records filed by both the parties. The complainant examined PW-1 to PW-4 from complainant side and the opposite party filed the Affidavit of Manager of opposite party. On behalf of them, an Advocate Commissioner was appointed to record the evidence of one Dr.B.Murali Krishna who treated the patient i.e, to the deceased prior to
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taking policy i.e, prior to his death. The Advocate Commissioner recorded the evidence of Dr.B. Murali Krishna and marked Exs.B-1 to B-7. The said doctor is examined as RW-2 on behalf of opposite party side. Now this Forum has to see whether there is any suppression of material facts by the LIC Agent i.e, the deceased herein.
The deceased obtained two policies bearing NO.686716201 sum assured Rs.1,50,000/- obtained on 25-07-2003 and another policy bearing NO.687082747 sum assured Rs.1,00,000/- obtained on 28-0-2004, but he died on 09-03-2007. Further the policy No.686716201 was revived on 14-02-2006 and Policy No.687082747 was revived on 28-11-2005, prior to death of the deceased he revived the policies it is true. But in this case as per the evidence of Rw-2 it clearly goes to show that the deceased was having small liver abscess since 22-12-2001 and he was hospitalized in Satya Hospital Warangal with Patient ID NO.913/2001 admitted on 30-12-2001 and discharged on 03-01-2002. Further the evidence of RW-2 clearly goes to show that the patient by name Bhaskar Reddy has came to his hospital on 22-12-2001 for the treatment of fever and painful liver during follow up he was advised to undergo ultra sound scan of abdomen and found to be small liver abscess in the right lobe of the liver, he was advised hospitalization for treatment at Satya Hospital, Warangal he got admitted in the hospital on 31-12-2001 with ID NO.913/01, he was given medical line of treatment, he
got relief of symptoms and discharged from the hospital on 03-01-2002, he got ultra sound scan of abdomen on 01-01-2002 which was showing multiple liver abscesses, he was under treatment with medicines and with regular follow up and without any complaints or any problems. Ultrasound scan of abdomen were done which was given the reports of reducing the sizes of the abscess and with reduction in number of abscess (on 02-01-2002 three abscess are found and on 24-01-2002 found to be single small liver abscess which was measuring (15x22) only. After 24-01-2002 patient did not visited his clinic with the above symtoms.
So as per the evidence of RW-2 it is clear that the deceased admitted in his hospital and taken treatment for Multiple Liver Abscess since 29-12-2001. Further Ex.B-1 it is the prescription of RW-1 it clearly goes to show that the deceased admitted in the hospital of RW-2 on 30-12-2001 and taken treatment and discharged on 03-01-2002 and Ex.B-2 dt. 02-01-2002 the deceased went to the hospital of RW-2, Ex.B-3 dt.29-12-2001 shows about the disease name i.e, Liver Abscess. Ex.B-4 dt.22-12-2001 it also
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clearly goes to show about the disease by name Liver Abscess and in the right side the medicines names also mentioned. Ex.B-5 dt.29-12-2001 it is the report of Venkateshwara Sono San and Diagnositcs it shows about the size of the Liver, Ball-Bladder, Right Kidney, Left Kidney, Spleen, Pancreas, Para Aoritic Area, Bladder and Prostate and in the down in Impression, it clearly mentioned Small Liver Abscesses in the right lobe and other organs are ultrasonically normal. It shows that the deceased was having Multiple Liver Abscess and Ex.B-6 dated 24-01-2002 it clearly goes to show the name of disease Liver Abscess, Ex.B-7 dt.11-01-2002 it also shows about the name of disease Liver Abscess. Ex.B-14 it is the report from SR Diagnostics, in Impression it clearly mentioned Left Pleural Effusion i.e, Liver Abscesses. So the dates mentioned by us in the above documents are 30-12-2001, 02-01-2002, 29-12-2001. These dates are before obtaining policy. Ex.B-1 to B-6clearly goes to show that prior to taking policies by the deceased he admitted in the hospital for the disease of Liver Abscess. After came to know that the deceased was having Liver Abscess disease he has taken two policies bearing NO.686716201 sum assured Rs.1,50,000/- obtained on 25-07-2003 and another policy bearing NO.687082747 sum assured Rs.1,00,000/- obtained on 28-08-2004. In these two policies, the nominee is the wife of the deceased. The deceased was LIC agent, he has taken two policies without mentioning the disease of Multiple Liver Abscess even though he was having the same disease on 29-12-2001 as per the documents we already stated in supra. So it comes under suppression of material facts because the deceased knows that he was having Multiple Liver Abscess disease but he suppressed the same without mentioning the same and obtained the above two policies in his name mentioning as nominee is his wife. We accept the evidence of RW-2 and Exs.B-1 to B-6 and come to the conclusion that the deceased was having disease of Multiple Liver Abscess since 29-12-2001.
At the time of taking two policies i.e, Ex.B-9 and Ex.B-10 in Column NO.11 (i) he stated about his health is good and with regard to other columns he stated simply NO. When he stated about his health condition is good certainly he suppressed his previous disease.
It is true as per the evidence of RW-2 and also ultrasound scan abdomen report dt.29-12-2001 shows small liver abscess in right lobe. He also taken medicines for liver abscess we already stated in supra and Ex.B-1 to B-4
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those documents clearly goes to show that the he has taken medicines for multiple liver abscess. So it clearly goes to show that the deceased suppressed the material facts.
The counsel for complainant cited a judgment in
AIR 2001 SUPREME COURT IN
Life Insurance Corporation of India & Others … Appellants
Vs
Smt.Asha Goel and another … Respondents
(A) Constitution of India, Art.226 – Extraordinary jurisdiction of High Court – Cannot ordinarily be exercised for enforcement of claim under contract of insurance.
This judgment is purely with regard to jurisdiction of High Court. So this judgment is not applicable to the case of the complainant.
Further in the said citation it is stated with regard to Section 45 of Insurance Act, in this case Section-45 of Insurance Act is clearly applicable because the deceased suppressed his disease Multiple Liver Abscess, so this judgment is not applicable to the case of complainants.
Further in 1987 (2) ALT 930
Life Insurance Corporation of India
Madame Cama Road, Bombay,
Rept. By its Chairman … Appellants
Vs
Vegesina Bharathi … Respondent
Insurance Act, 1938 – Secs.45 and 50. On revival of a lapsed policy on medical report the original policy comes into operation – Two years period under Sec.45 is to be computed not from date of revival of policy but from date on which policy originally is effected.
The above citation facts and the present case facts are different. So the above citation is not applicable to the case of the complainant.
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The deceased cheated the insurance by way of Fraud. Fraud means and includes any of the following acts committed by a party to a contract or with his connivance, or by his agent, with intent to deceive another party thereto or his agent, or to induce him to enter into the contract:
i) the suggestion, as to a fact, of that which is not true by one who does not believe it to be true
ii) the active concealment of a fact by one having knowledge or belief of the facts
iii) a promise made without any intention of performing it;
iv) any other act fitted to deceive’
v) any such act or omission as the law specially declares to be fraudulent”.
So the deceased cheated the insurance by way of fraud, so the complainants are not entitled to get anything.
For suppression of material facts the counsel for the opposite parties cited an Apex court citation in (2008) I Supreme Court Cases 321
PC Chacko and another … Appellants
Vs
Chairman, LIC of India and Others … Respodents
Insurance Act, 1938 – S.45 – Repudiation of claim under insurance policy on ground of misstatement – Held, misstatement by itself not reason for recission of the policy unless the same is material in nature – However, a deliberate wrong answer given by insured having a great bearing on contract of insurance may lead to policy being vitiated in law – Policy can be repudiated if obtained with a fraudulent act.
The above citation is applicable to the case of opposite parties because in the present case also the deceased suppressed his disease Multiple Liver Abscess and obtained two policies. So it comes under suppression of material facts, so section 45 of Insurance Act is applicable to this case.
For the foregoing reasons given by us we come to the conclusion that the deceased cheated the insurance and fraud. When he cheated the insurance Section 45 of Insurance Act is applicable to this case and we answered this point accordingly in favour of the opposite party against the complainant.
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Point NO.2: To what Relief:- The first point is decided in favor of the opposite party against the complainant this point is also decided in favour of the opposite party against the complainant.
In the result this complaint is dismissed without costs.
Dictated to the Stenographer, transcribed by her, corrected and pronounced by us in the open Forum today, the 21st June, 2011).
President Male Member
District Consumer Forum, Warangal.
APPENDIX OF EVIDENCE
WITNESSES EXAMINED
On behalf of Complainant On behalf of Opposite Party
Depositions of PW-1 to PW-4. Affidavit of opposite party filed.
Deposition of RW-2.
EXHIBITS MARKED
ON BEHALF OF COMPLAINANTS
1. Ex.A-1 is the Status Report of the Policy No.686716201.
2. Ex.A-2 is the Status Report of the Policy No.687082747.
3. Ex.A-3 is the office copy of legal notice issued to opposite party,
dt.27-08-2008.
4. Ex.A-4 is the Postal Receipt.
5. Ex.A-5 is the Postal Acknowledgment.
6. Ex.A-6 is the original copy of Jeevan Mitra (Triple Cover Endowment Plan)
ON BEHALF OF OPPOSITE PARTY
1. Ex.B-1 is the Discharge card issued by Satya Hospital.
2. Ex.B-2 is the Prescription of the deceased Bhaskar Reddy issued by Satya Hospital, Warangal, dated 02-01-2002.
3. Ex.B-3 is the Prescription of the deceased Bhaskar Reddy issued by Satya Hospital, Warangal, dated 29-12-2001.
4. Ex.B-4 is the Prescription of the deceased Bhaskar Reddy issued by Dr.Bachhu Murali Krishna, Warangal, dated 22-12-2001.
5. Ex.B-5 is the Ultrasonography of Abdomen report of the deceased Bhaskar Reddy issued by Venkateshwara Sono Scan and Diagnostics.
6. Ex.B-6 & B-7 are the Prescriptions of the deceased Bhaskar Reddy issued by Satya Hospital, Warangal, dated 24-01-02 and 11-01-02.
7. Ex.B-8 and Ex.B-9 are the proposals for insurance.
8. Ex.B-10 is the Agent’s Confidential report.
9. Ex.B-11 is the Addendum to proposal under Asha Deep Plan.
10. Ex.B-12 & B-13 are the Personal Statements regarding Health.
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11. Ex.B-14 is the report of USG Abdomen male issued by S.R.Diagnostics.
12. Ex.B-15 is the Medical Examiner’s Confidential Report.
13. Ex.B-16 is the Agent’s Confidential Report.
14. Ex.B-17 is the Xerox copy of Medical Examiner’s Confidential report.
15. Ex.B-18 is the Xerox copy of Claimant’s Statement.
16. Ex.B-19 is the Xerox copy of death certificate issued by opposite party.
17. Ex.B-20 is the Xerox copy of Medical Examiner’s Confidential Report.
PRESIDENT
