THE DISTRICT CONSUMERS FORUM: KURNOOL
Present: Sri.Y.Reddappa Reddy, M.A., L.L.M., President,
And
Smt. S.Nazeerunnisa, B.A., B.L., Lady Member
Monday the 2nd day of March, 2015
C.C.No.112/2014
Between:
K.Minnella,
S/o K.Minnella,
Hindu, Aged about 42 Years,
R/o H.No.4-111, S.C. Colony,
Kotakona Village-518 225,
Devanakonda Mandal,
Kurnool District. …Complainant
-Vs-
1. The Manager,
Head-Claims,
S.B.I. Life Insurance Company Limited,
Central Processing Centre,
Kapas Bhavan, Plot No.3A,
Sector No.10, CBD Belapur,
Navi Mumbai-400 614.
2. The Branch Manager,
S.B.I. Life Insurance Company Limited,
S.V. Complex, 2nd Floor,
Kurnool-518 001. …OPPOSITE PARTIES
This complaint is coming on this day for orders in the presence of Smt.A.Uma Devi, Advocate for complainant and Sri.M.Syam Kumar Reddy, Advocate for opposite parties 1 and 2 and upon perusing the material papers on record, the Forum made the following.
ORDER
(As per Smt. S.Nazeerunnisa, Lady Member,)
C.C. No.112/2014
1. This complaint is filed under section 11 and 12 of Consumer Protection Act, 1986 praying:-
- To directing the opposite parties to pay the award amount of Rs.8,25,000/-.
- For causing mental agony of Rs.10,000/-.
- For the cost of this complaint.
- To award interest at 9% per annum from the date of submission of documents.
- To grant any such other relief or reliefs as the Honourable Forum may deem fit in the circumstances of the case.
2. The facts of the complainant in brief is as under:- The complainant is the husband of Late.K.Reshma. K.Reshma insured her life with opposite party No.1 through opposite party No.2 under the policies bearing No.35022854201 on 17.05.2012 and policy bearing No.35023384904 on 04.06.2012 for a sum assured of Rs.5,00,000/- and Rs.3,25,000/- with an half yearly premium of Rs.8,882/- and Rs.5,933/-, The complainant is the nominee under the policy. On 13.01.2014 the insured died due to Heart Attack at her residence and death is natural one. The complainant who is a nominee under the policy submitted claim to opposite parties. The complainant approached opposite party No.2 and requested to settle the claim of the complainant, but they did not respond. On 13.06.2014 the opposite parties repudiated the claim on the ground that, insured with held the correct information regarding her previous policies and she concealed this fact and obtained policy. The complainant got issued legal notice on 12.08.2014 to opposite parties and the opposite party No.1 had given reply to the complainant stating that the insured had several policies prior to obtain this policy, and she did not disclose the material facts about the previous life insurance policies. But the policy form was filled up by his agent by name D.Diwakar. He did not inform to the insured/deceased about the conditions of the policy. The opposite parties repudiated the claim without any reasonable ground. There is deficiency of service on the part of opposite parties and caused mental agony. Hence the complaint.
3. Written version filed on behalf of opposite party No.1. Opposite party No.2 adopted the same written version filed by opposite party No.1. This complaint is frivolous and malicious and is not maintainable either in law or on facts. This complaint is not maintainable for want of territorial jurisdiction. It is admitted that the opposite parties issued policies bearing Nos.35022854201 and 35023384904 to the insured/deceased. It is also admitted that the complainant made a claim to opposite parties and the opposite parties repudiated the same on 13.01.2014 for non-discloser of material fact in regard to her previous policies obtained from Birla Sun Life Insurance. After received e-mail from Birla Sun Life Insurance, the opposite parties came to know that she was holding insurance policies bearing Nos.004620742 and 005568750 with dates of commencement as 31.12.2010 and 07.05.2012 with sum assured of Rs.1,15,000/- and Rs.1,18,000/- respectively with Birla Sun Life Insurance Company Limited. She did not reveal the material fact that Birla Sun Life Insurance had rejected her policy bearing No.005567950 for a sum assured of Rs.8,00,000/- in may, 2012. But the same was not disclosed in the proposal forms. The above policies were obtained fraudulently by suppressing the material facts. She did not reveal the SBI existing policy issued on 17.05.2012. The life insurance contract is a contract of “UTMOST GOOD FAITH” thus any contract of insurance procured by breaching the principle of “UTMOST GOOD FAITH” is a nullity and void abinitio. The opposite parties acted as per terms and conditions of the policy. Thus the opposite parties are not liable to pay any amount towards death benefits or any compensation. There is no deficiency of service on the part of opposite parties. Hence the complaint is liable to be dismissed.
4. On behalf of the complainant filed Ex.A1 to Ex.A7 are marked and sworn affidavit of complainant is filed. On behalf of opposite parties filed Ex.B1 to Ex.B7 are marked and sworn affidavit of opposite party No.1 is filed.
5. Both sides filed written arguments.
6. Now the points that arise for consideration are:
- Whether this Forum has no territorial jurisdiction to entertain this complaint?
- Whether there is deficiency of service on the part of opposite parties?
- Whether the complainant is entitled for the reliefs as prayed for?
- To what relief?
7. POINT No.i:- It is the case of opposite parties that this Forum has no jurisdiction to entertain the complaint as the opposite party No.1 office is located at Mumbai but the complaint is filed at Kurnool. The complaint is not maintainable for want of territorial jurisdiction. It is the case of complainant that opposite party No.2 is the Branch Office of opposite party No.1. The policy was obtained from opposite party No.1 through opposite party No.2 and the premiums paid through opposite party No.2 at Kurnool, so the cause of action for the complaint arose in Kurnool. This Forum has got jurisdiction to entertain the complaint. Under section 11 of consumer Protection Act provides that a complaint shall be instituted in a District Forum within the local limits of whose jurisdiction, the opposite party resides or carries on business or has a branch Office or personally works for gain, it also provides that the complaint shall be instituted in the District Forum within the local limits of whose jurisdiction the case of action wholly or in part arise, the opposite party No.2 is the branch office situated at Kurnool. It is not the case of opposite party No.2 that opposite party No.2 office is not a branch of opposite party No.1. Opposite party No.2 adopted the same written version, sworn affidavit and written arguments filed by opposite party No.1. There is a relationship between opposite party No.1 and opposite party No.2. The opposite parties cited decision of National Commission in First Appeal No.428/2008 in New India Assurance Company Limited -Vs- Gopal Gupta and others and Honourable Supreme Court decision in Life Insurance Corporation of India -Vs- Surinder Kaur and others in Civil Appeal No.5334/2006, SLP (C) are not applicable to this case. Hence this Forum has got proper territorial jurisdiction to entertain this complaint.
8. POINTS ii and iii:- Admittedly the insured K.Reshma obtained the S.B.I. Life Insurance “Shubh Nivash” whole life plan policies from opposite party No.1 through opposite party No.2 bearing No.35022854201 on 17.05.2012 and policy bearing No.35023384904 on 04.06.2012 for the sum assured of Rs.5,00,000/- and Rs.3,25,000/- under Ex.B3 and Ex.B4 with half yearly premium of Rs.8,882/- and Rs.5,933/-. Ex.A1 is the repudiation letter dated 13.06.2014 along with first policy copy bearing No.35022854201 and Ex.A2 is the same repudiation letter dated 13.06.2014 along with second policy bearing No.35023384904. The deceased insured died on 13.01.2014 due to Heart Attack. Ex.A7 is the Death Certificate issued by Mandal Revenue Officer, Devarakonda Mandal, Kurnool District, dated 16.04.2014.
Admittedly the complainant submitted claim form to opposite parties. The opposite parties repudiated the claim of two policies on 13.06.2014 Ex.B6, Ex.A1 and Ex.A2 on the ground that the deceased/insured suppressed the material facts regarding her previous policies at the time of taking policy. The complainant in her sworn affidavit stated that the allegations made against the insured are baseless. The complainant got issued legal notice on 12.01.2014 it is marked as Ex.A3, postal receipts marked as Ex.A4 and postal acknowledgement marked as Ex.A5. The opposite party No.1 has given reply on 22.08.2014 under Ex.A6=Ex.B7.
Opposite party No.1 in his sworn affidavit stated that after enquired in to the death of insured, it was found that insured was holding insurance policies bearing Nos.004620742 and 005568750 for the assured sum of Rs.1,15,000/- and Rs.1,18,000/- with Birla Sun Life Insurance Company Limited. But she did not disclose the same in proposal form and she also did not reveal the SBI existing policy issued on 17.05.2012. The proposal forms are marked as Ex.B1 and Ex.B2. The insured concealed the material facts with regard to rejection of policy bearing No.005567950 for assured sum of Rs.8,00,000/- in May, 2012. The e-mail letter sent by Birla Sun Life Insurance is marked as Ex.B5 dated 30.05.2014. The insured known fully well that she concealed and misstated/suppressed the material facts at the time of procuring insurance policy from the opposite parties, so the opposite party repudiated claim under Ex.B6 and had given reply for the complainant under Ex.B7-Ex.A6 dated 22.08.2014. The learned counsel appearing for the opposite parties contended that Life Insurance Contract is an utmost good faith but the insured breach the principle of utmost good faith and obtained policies is itself a nullity and void abinitio, so the opposite parties are not liable to pay any death benefits or compensation. In his written arguments he cited decisions reported in II (2003) CPJ 135 (NC) LIC -Vs- Mansa Devi it was held that the contract of insurance is of utmost good faith and life assured is bound to disclose honestly and truthfully to all the questions in the proposal form.
The learned counsel appearing for the complainant contended that the insured was illiterate she did not know English but the proposal forms were filled up in English by the agent of opposite parties Divakar. He did not inform the conditions of insurance policy. To support her version she cited a decision reported in III (2011) CPR (NC) 474 LIC -Vs- Shahida Begum, wherein the Honourable National Commission held that the assured has a duty to disclose and similarly it is the duty of the insurance company and its agent to disclose all material facts in their knowledge since obligation of good faith applies to both equally. The policies were filled up by one agent and issued by same branch of opposite party No.1. So they should have recorded their requisite information already available with them as per the procedure and rules of the opposite party corporation in the proposal form. The facts of the cited case is applicable to the present case on hand.
9. There is no dispute in regard to issuance of two policies bearing Nos.35022854201 on 17.05.2012 and 35023384904 on 04.06.2012 for the sum assured of Rs.5,00,000/- and 3,25,000/- and the complainant is the nominee under the said policies. Admittedly the complainant submitted claim form to the opposite parties and the opposite parties repudiated the same under Ex.B6, Ex.A1=Ex.A2 dated 13.06.2014, on the ground that the deceased/insured suppressed the material facts regarding her previous policies with Birla Sun Life Insurance Company. The opposite party No.1 produced Ex.B5 the copy of e-mail letter dated 30.05.2014 sent by Birla Sun Life Insurance Company. The onus to prove is on the insurance company to prove the all aged suppression of material facts by insured by evidence. The opposite parties did not choose either to examine its agent, who filled up the proposal forms or any affidavit of said agent not filed. Without filling any credible evidence on their behalf it is not possible to come into conclusion that the insured violated the terms and conditions of policies. The opposite parties could not establish that the insured/deceased concealed material facts regarding her previous policies at the time of taking policies. We persued all the material available on record and in the light of all the above decision we hold that there is a deficiency of service on the part of opposite parties. Hence the complainant is entitled for an assured amount of Rs.5,00,000/- and Rs.3,25,000/- under the said policies.
10. POINT No.iv:- The complainant claimed for amount of Rs.5,00,000/- and Rs.3,25,000/- with interest at 9% per annum from the date of submission of documents and further claims of Rs.10,000/- for mental agony and cost of the case. We consideration all the facts and circumstance of the case and all the material available on record, we are of the view that the complainant is entitled for an amount of Rs.5,00,000/- and Rs.3,25,000/- with interest at 9% per annum from the date of complaint i.e., on 19.09.2014 till the date of realization and further entitled compensation of Rs.5,000/- towards mental agony.
11. In the result, the complaint is partly allowed directing the opposite parties jointly and severally to pay an amount of Rs.5,00,000/- and Rs.3,25,000/- with interest at 9% per annum from the date of complaint i.e., on 19.09.2014 till the date of payment and further direct to pay compensation of Rs.5,000/- towards mental agony and Rs.1,000/- as costs of the case. Time for compliance is one month from the date of receipt of this order.
Dictated to the stenographer, transcribed by her, corrected and pronounced by us in the open bench on this the 2nd day of March, 2015.
Sd/- Sd/-
LADY MEMBER PRESIDENT
APPENDIX OF EVIDENCE
Witnesses Examined
For the complainants:- Nil For the opposite parties:- Nil
List of exhibits marked for the complainants:-
Ex.A1 Photo copy of Repudiation Letter to opposite party No.1 to
complainant dated 13.06.2014 along with Policy bearing
No.35022854201.
Ex.A2 Photo copy of Repudiation Letter to opposite party No.1 to
complainant dated 13.06.2014 along with Policy bearing
No.35023384904.
Ex.A3 Office copy of Legal Notice dated 12.08.2014.
EX.A4 Postal Receipts (Nos.2).
Ex.A5 Postal Acknowledgement
Ex.A6 Reply Notice dated 22.08.2014
Ex.A7 Photo copy of Death Certificate issue date 16.04.2014.
List of exhibits marked for the opposite parties:-
Ex.B1 Photo copy of Proposal Form bearing No.35-QB379118.
Ex.B2 Photo copy of Proposal Form bearing No.35-QB379119.
Ex.B3 Photo copy of Policy bearing No.35022854201 along with First
Premium Receipt for Rs.9,157/- and terms and conditions.
Ex.B4 Photo copy of Policy bearing No.35023384904 along with First
Premium Receipt for Rs.6,117/- and terms and conditions
Ex.B5 Copy of Email letter sent by Birla Sun Life Insurance dated
30.05.2014.
Ex.B6 Office copy of Repudiation Letter to opposite party No.1 to
complainant dated 13.06.2014 along with Policy bearing
No.35022854201.
EX.B7 Office copy of Reply Notice dated 22.08.2014
Sd/- Sd/-
LADY MEMBER PRESIDENT
// Certified free copy communicated under Rule 4 (10) of the A.P.S.C.D.R.C. Rules, 1987//
Copy to:-
Complainant and Opposite parties :
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