PER S.K. NAIK, MEMBER

          Life Insurance Corporation of India, Opposite Parties No. 1 and 2, have filed this revision petition assailing the order dated 11^th of May, 2010 passed by the Rajasthan State Consumer Disputes Redressal Commission, Jaipur (State Commission for short), whereby it has allowed the complainant’s appeal and set aside the order dated 22^nd of May, 2008 passed by the District Consumer Disputes Redressal Forum, Bundi, Rajasthan (District Forum for short).  The State Commission, besides granting a compensation of Rs.50,000/- with 9% interest from the date of filing of the complaint till realization has also awarded a cost of Rs.3000/-.

          In brief, the facts as alleged by the respondent in his complaint are that he had obtained an insurance policy by the name of  ‘Ashadeep Life Insurance Policy’ from the petitioner/opposite party/Insurance Corporation on the 28^th of November, 1993.  This policy was effective for a period of 20 years and the sum assured was for Rs.50,000/-.  As per the policy, the petitioner/opposite party/Insurance Corporation was liable to indemnify the respondent/complainant if during the currency of the policy he dies or suffers permanent disability during the currency as applicable.  The respondent/complainant suffered a paralytic attack on the 21^st of August, 2006, for which he had to be hospitalized for some days in Government Hospital, Kota and thereafter at Jaipur.  Due to the said attack, his right side of the body including his right leg and right hand got completely paralyzed.  The respondent/complainant was examined by a Medical Board on the 29^th of October, 2007, which opined that he has suffered permanent disability above 40%.  A medical certificate was also issued in this regard by the Medical Board.  In these circumstances, the complainant preferred a claim before the petitioner/opposite party/Insurance Corporation, asserting his disability being of permanent nature, which was repudiated by the Insurance Corporation vide their letter dated 28^th of September, 2007.  The repudiation of his claim by the Insurance Corporation necessitated the respondent to file a complaint before the District Forum alleging deficiency in service and praying for the benefit of permanent disability with compensation of Rs.10,000/- on account of mental agony suffered by him with costs of Rs.5000/-.  The District Forum after considering the rival submissions made by the parties held that there was no deficiency of service on part of petitioner/opposite party/Insurance Corporation and dismissed the complaint.  The respondent/complainant challenged the order of the District Forum before the State Commission, who vide the order impugned allowed the appeal of the respondent/complainant and directed the petitioner/opposite party/Insurance Corporation in the manner indicated above.

          Hence, this revision petition by the Insurance Corporation challenging the order of the State Commission.

          Despite due service of the notice sent to the respondent/complainant, he has not turned up.  We have perused the records and heard the learned counsel for the petitioner/opposite party/Insurance Corporation.

          Admittedly the respondent/complainant had obtained the ‘Ashadeep Life Insurance Policy’ for a sum of Rs.50,000/- on 28^th of January, 1993.  This policy was valid for a period of 20 years and the respondent/complainant was making the payment of the due premium regularly.  On 21^st of August, 2006, he suddenly suffered an attack of paralysis.  He was treated first at the Government Hospital Kota and subsequently at Jaipur.  He, however, could not recover and a Medical Board finally came to the conclusion that the case of the respondent/complainant was that of Hemiplegia and the permanent disability was above 40%.  His request for benefit under the Ashadeep Life Insurance Policy was rejected by the petitioner/Insurance Corporation, holding that the paralytic attack did not result in complete and permanent disability of two or more limbs as provided under Clause 11(b)(iv) of the policy.  The District Forum relying on this ground argued by the counsel for the petitioner/opposite party/Insurance Corporation and also taking note of contention of petitioner/opposite party/Insurance Corporation that the complainant was found fit to resume duty had dismissed the complaint.  In the appeal that was filed by the respondent/complainant before the State Commission, the view of the District Forum has been rejected by the State Commission.  According to the State Commission, irrespective of the percentage of disability, the fact remains that a person suffering from even 40% disability would not be ‘in a position to do job in the same manner as he was doing before that attack.  Thus, there would be a reduction in his power to earn money or to do other job’.  The appeal of the respondent/complainant, therefore, has been accepted and the petitioner/Insurance Corporation has been directed to pay the full insured sum of Rs.50,000/- with 9% interest.

          Since the proper resolution of the dispute depends primarily on the interpretation of the terms of the policy, it would be very relevant to first examine the terms of the said policy.  A copy of the Ashadeep Policy with profits (with Accident Benefit) has been filed by the petitioner/opposite party/Insurance Corporation, which is at page 41 of the paper-book.  Against the column ‘Event on the happening of which Benefits payable’, it states as under :-

“If the Policy is in force for full sum assured, one of the two benefits, (A) or (B) defined hereinbelow will be provided subject to the conditions mentioned herein.  Either of the benefits is payable only once during the term of the Policy.

Benefit (A)    The sum assured with vested bonus, if any, is payable in the event of the Life Assured surviving the stipulated date of maturity or at his death, if earlier.

Benefit (B)    If any one of the contingencies given in para 11(b), subject however to the conditions mentioned in para 11(a) & 11(c) of the ‘Conditions & Privileges’ within referred to occurs during the term of the Policy, then the following benefits will be available.

(i)                Immediate payment of 50% of the sum assured.

(ii)              Payment of balance 50% of the sum assured alongwith vested bonus, if any, in the event of the Life Assured surviving the stipulated date of maturity or at his death, if earlier.

(iii)            Payment of an amount equal to 10% of the sum assured, every year, commencing from the Policy anniversary falling on or immediately after the date of eligibility for Benefit (B) and ending with the policy anniversary preceding the stipulated date of maturity or the date of death of the Life Assured, whichever is earlier.

(iv)            Waiver of premiums, if any, (including accident premium) due from the policy anniversary falling on or immediately after the date of eligibility for Benefit (B).”

The case of the respondent/complainant obviously does not fall in the category of Benefit (A) as the complainant has neither died nor has he reached the stipulate date of maturity.  His case, therefore, will fall in the category of Benefit (B).

The other important term of the policy, on the basis of which the petitioner/opposite party/Insurance Corporation has repudiated the claim and which is also the basis of dismissal of his complaint by the District Forum, is Clause 11, which again is relevant.  Clause 11 states as under:-

“11. (a)        Benefit (B) of the Policy Schedule is not applicable if any of the contingencies mentioned in Para 11(b) occurs (i) at any time on or after the date on which the risk under this Policy is commenced but before the expiry of one year reckoned from the date of this Policy or (ii) within one year from the date of revival.

11. (b)         Benefit (B) of the Policy Schedule shall be available on the occurrence of any of the following contingencies.

(i)                the Life Assured undergoes open Heart By-Pass surgery performed on significantly narrowed/occluded coronary arteries to restore adequate blood supply to heart and the surgery must have been proven to be necessary by means of coronary angiography.  All other operations (e.g. angioplasty and Thrombolysis by Coronay Artery Catheterization) are specifically excluded.

OR

(ii)               the Life Assured undergoes Renal Dialysis or Renal Transplantation as a result of an end stage Renal Failure presented as chronic irreversible failure of both Kidneys to function.

OR

(iii)            the Life Assured suffers from Cancer (Mallgnant).  (That is, the presence of uncontrolled growth, and spread of cancer cells which destroy the tissues in which they arise with a potential for invading adjacent structures and capable of spreading to distant organs).  This includes leukaemia, Hodgkin’s Disease and invasive mallgnant melanoma of skin but excludes carcinoma in situ, tumours associated with HIV infections, non-invasive localized cancers and all other skin cancers.

OR

(iv)            the Life Assured suffers from paralytic stroke (that is cerebrovascular accident or incident producing neurological sequelae lasting more than 24 hours) resulting into complete and permanent disability of two or more limbs persisting for more than three months from the date of acute episode.  Specifically excluded are Translent Ischaemic Attacks and Stroke like syndromes resulting from :- (1) Head Injury (subdural or extradural haematoma) (2) Cerebral abscess (3) Pyogenic tuberculosis, meningocco meningitis.”

(emphasis added)

While Clause 11(a) relates to the circumstances under which Benefit (B) will not be applicable, Clause 11 (b) gives the contingencies on the occurrence of which Benefit (B) shall be available.  In this case, the claim of the respondent/complainant has been repudiated under Clause 11(b)(iv).  A careful reading of this clause makes it clear that in order to be entitled to Benefit (B) of the policy, the Life Assured would have suffered from paralytic stroke resulting into complete and permanent disability of two or more limbs persisting for more than three months from the date of acute episode.  In this background, what would be relevant is to see as to whether the paralytic stroke suffered by the respondent/complainant resulted in complete and permanent disability of two or more limbs and nothing beyond.  The certificate issued by the Medical Board of the Government of Rajasthan at page 87 of the paper-book clearly refers to it a certificate for permanent disability.  It further states that it is a case of Hemiplegia of the right side.  For ready reference, the certificate may also be reproduced, which is as under :-

“GOVERNMENT OF RAJASTHAN

MEDICAL & HEALTH DEPARTMENT MEDICAL BOARD’S

CERTIFICATE ON PERMANENT DISABILITY

(Specified in Section 2(b)(c)(1)(n)(o)(q)(r)(t) and (u) of the persons with disabilities Act, 1995 C II of the persons with disabilities Rule 1996 Notification of the Govt. of India in the Ministry of Welfare No. 4-2/83 IIW date 6^th August 1986 & Circular No. 16/5/MII/2/98 dated 10.6.2000 medical & health Department, Govt. of Rajasthan.

Certificate No. M-109, Date 29.10.2007

Name of Hospital : G. Hospital, Bundi

This is to certify that Shri Mahender Singh, whose particulars are furnished below is bonafide person with disability Orthopaedically/Visually/Hearing Impairment/Mentally.

Particulars of the Handicapped person

Father’s Name : Shri Kalyan Singh

Gender :  Male

Age : 52 years

Address : Rajat Grah Colony Bundi

Identification mark : 2 black mole on chest …

History of illness/Trauma duration : Old case of Hemiplegia ….

Short description of the permanent disability : A case of Hemi…(sic). (RL)

Blood Group …..

Aggregate percentage of the permanent disability : Above 40%

Sd/-

Signature :

Thumb impression of the Handicapped person

      Sd/-                                        Sd/-                                Sd/-

CHAIRMAN                                MEMBER                          MEMBER”

(emphasis added)

          Hemiplegia means that one side of a person’s body has been paralyzed; meaning thereby that one leg, one hand and further perhaps the hearing capacity of same side of the ear and the power of vision on that side of the eye also have suffered disability.  Thus, there is no manner of doubt that the respondent/complainant has suffered permanent disability of at least two limbs i.e. one hand and one leg if not more resulting from the paralytic stroke.  What is, however, surprising is that both the petitioner/opposite party/Insurance Corporation as well as the District Forum had relied upon the aggregate percentage of disability which is stated to be above 40% negating the effect of permanent disability of the two limbs.  Only to be noted that the terms of the policy does not refer to any percentage of disability.  It’s only requirements are that the paralytic stroke suffered by the Life Assured should result into complete and permanent disability of two or more limbs.  Thus, both the petitioner/opposite party/Insurance Corporation as well as the District Forum ought not to have traveled beyond this specified term of the policy in rejecting the claim of the respondent/complainant.  Whether the percentage of disability suffered and the ability of the respondent/complainant to have rejoined his duty would have absolutely no relevance to the contract.  The terms of the policy are in the nature of a contract and their interpretation has to be made in accordance with the strict construction of the contract.  Thus, the words in an insurance contract must be given paramount importance and interpreted as expressed without any addition, deletion or substitution.  The law in this regard is very well settled and one may conveniently refer to a recent judgment of the Hon’ble Apex Court in the case of Suraj Mal Ram Niwas Oil Mills (P) Ltd. Vs. United India Insurance Co. Ltd. [(2010) 10 SCC 567].  Thus, we have no hesitation to hold that the repudiation of the claim by the petitioner/opposite party/Insurance Corporation was not at all justified and the view taken by the District Forum was not sustainable. 

          Mr. Rajat Bhalla, learned counsel appearing for the petitioner/opposite party/Insurance Corporation has again reiterated the stand taken before the District Forum and has relied upon the disability not being 100% and, therefore, seeks setting aside of the order passed by the State Commission.  He has also relied upon two orders passed by this Commission in the cases of Life Insurance Corporation of India & Anr. Vs. Shri Kondala Appala Raju (R.P. No. 1836 of 2005) and Life Insurance Corporation of India Vs. Prakash Chandra (R.P. No. 2017 of 2007) in support of his case.  We have perused the said orders.  The first order cited refers to a case under the Bima Kiran Policy.  The terms in that policy were not similar to the one in this case.  Similarly, the second case was decided on the basis of an order passed in R.P. No. 1511 of 2005 in Ajay Kumar Vs. LIC of India, wherein again there was stipulation with regard to the percentage of disability.  These orders would have no bearing on the facts of the present case.

          Faced with this situation, Shri Bhalla contends that the order of the State Commission is patently wrong as it has awarded the Benefit (A), which is applicable only in case of death or on maturity.  At the most the respondent/complainant would be entitled to Benefit (B) if at all.

          This leaves us to examine as to whether the State Commission was right in directing the petitioner/opposite party/Insurance Corporation to pay the total insured sum under the policy alongwith 9% interest per annum from the date of filing of the complaint.  It is to be noted that the total insured sum of Rs.50,000/- would be admissible if a Life Assured is entitled to Benefit (A) under the policy.  As stated earlier, Benefit (A) is applicable only in respect of death during the currency of the policy or the Life Assured surviving the entire period of the policy i.e. on maturity.  Thus, the State Commission clearly misdirected itself in believing that the respondent/complainant was entitled to Benefit (A).  Benefit (B) on the other hand enjoins upon the petitioner/opposite party/Insurance Corporation to make immediate payment of 50% of the sum assured and further payment of the balance payment of the 50% alongwith bonus, if any, in the event of the Life Assured surviving the stipulated date of maturity or at this death, if earlier.  It further stipulates the payment of an amount equal to 10% of sum assured every year commencing from the policy anniversary falling on or immediately after the date of eligibility for Benefit (B).  What is, however, significant is that the respondent/complainant would be entitled to waiver of future premiums due from the policy under Clause (b)(iv).  Thus, both the fora below have totally gone wrong in passing their respective orders.  Since the respondent/complainant is not entitled for Benefit (A), which has been erroneously awarded by the State Commission, we set aside the order of the State Commission.  However, since the respondent/complainant is eligible to Benefit (B) under the policy, we direct the opposite party/Insurance Corporation to extend to the respondent/complainant the said Benefit (B) within a period of two months from the date of receipt of a copy of this order. 

          The revision petition stands disposed of with the above direction.  However, in the facts and circumstances of this case there will be no order as to cost.