This revision petition has been filed by the petitioner Reliance Nippon Life Insurance Company Limited against the order dated 07.10.2016 of the State Consumer Disputes Redressal Commission, Bihar, (in short ‘the State Commission’) passed in Appeal No.128 of 2016.

2.      Brief facts of the case are that respondent/ complainant took two insurance policies under Reliance Life Insurance Classic Plan (Regular) as under:

3.      On 05.03.2013 insured died.  On 27.09.2013, Insurance Company repudiated the claim on the ground of misrepresentation in respect of occupation and nature of duties as well as in respect of the income.

4.      Aggrieved, the complainant filed a consumer complaint bearing No.17/2014 before the District Consumer Disputes Redressal Forum, Katihar, (in short ‘the District Forum’).  The complaint was resisted by the opposite party/ Insurance Company on the ground that information in respect of income and occupation of the insured was wrongly given in the proposal form and the complainant has also filed false documents.  The investigator has found the following:

(a)     the insured was a housewife, not engaged in service; her husband was a government employee and after his demise, she became the pension holder;

(b)     The Chartered Accountant certificate reflecting the accounts of the L.A.’s income was not correct;

(c)     Mentioned income as Rs.1.80,000/- but she received only Rs.1,26,960/- per year.

5.      On the above grounds, it was requested to dismiss the complaint.  The District Forum allowed the complaint vide its order dated 28.01.2016 and directed the opposite party to pay the assured sum of both policies with 6% p.a. interest to the complainant within 60 days with compensation of Rs.10,000/- and litigation cost Rs.2,500/-.

6.      Aggrieved with the order of the District Forum, the opposite party Insurance Company preferred an appeal bearing No.128 of 2016 before the State Commission.  However, the State Commission vide its order dated 07.10.2016 dismissed the appeal.

7.      Hence the present revision petition.

8.      Heard the learned counsel for the petitioner and perused the record.  Learned counsel for the petitioner stated that the false information was given by the insured in the proposal form in respect of her income as well as the profession.  In the proposal form, the income has been shown as Rs.1,80,000/- whereas from the pension her income was only Rs.1,26,960/-.  Thus, there was a clear concealment of the correct income.  The State Commission has not considered the issue of authenticity of the ITRs, profit & loss account, balance sheet and Chartered Accountant certificate, which were submitted by the respondent to justify the income of the DLA.  Upon the investigation, these documents have been found to be forged.  The State Commission has not taken into consideration the fact that insurance is a matter of utmost good faith and if the policy holder has concealed the material fact then the contract of insurance becomes void ab initio. 

9.      Learned counsel for the petitioner further submitted that there is a delay of 142 days in filing the revision petition.  It was stated that the delay has occurred due to time taken in the legal department of the company as there was reshuffling of the officials in that department.  After the legal advice the time was taken in the corporate office when the decision was taken to file the revision petition.  Some time was taken in preparation of the revision petition.  The delay is inadvertent and bona fide. If the delay is condoned, there would be no prejudice caused to the respondent/complainant.

10.    Learned counsel further mentioned that it is surprising to note that in the first proposal form, income has been given as Rs.1,80,000/-, whereas in the second proposal form, which was filled only after 8 months, income has been mentioned as Rs.4,00,000/-, though in both the proposal forms, the occupation has been mentioned as pension holder. 

11.    The learned counsel for the petitioner relied on the judgment of Hon’ble Supreme Court in P.J. Chacko and Anr. Vs. Chairman, Life Insurance Corporation of India &Ors., AIR 2008, SC 424, to support his argument that a deliberate wrong answer will vitiate the insurance policy.  Hon’ble Supreme Court in this case has observed the following:-

    “A deliberate wrong answer which has a great bearing on the contract of insurance, if discovered, may lead to the policy being vitiated in law.  The purpose for taking a policy of insurance is not very material.  It may serve the purpose of social security but then the same should not be obtained with a fraudulent act by the insured. Proposal can be repudiated if a fraudulent act is discovered.”

12.    On the other hand the learned counsel for the respondent/complainant stated that this revision petition is not maintainable as there is a delay of 142 days in filing the present revision petition.  The reasons given in the application for condonation of delay are only imaginary as no documentary proof has been submitted for the reasons mentioned.  Otherwise also, the delay occurring due to administrative lapses cannot be considered as sufficient cause for condoning the delay. It was argued that such huge delay in filing the revision petition cannot be condoned against the concurrent finding of the fora below.

13.    It was further submitted by the learned counsel for the respondent that both the fora below have given concurrent finding of fact and the scope under the revision petition is very limited in such circumstances.  The facts cannot be reassessed at the stage of revision petition by this Commission as the same have been concurrently assessed by the fora below.

14.    On merits it was stated by the learned counsel for the respondent that first of all the proposal forms are generally filled by the agents of the Insurance Company and in the present case also the proposal forms were filled by the agent and if some mistakes have been done by the agent, the DLA cannot be held responsible as held by National Commission in Sahara India Life Insurance Company Ltd. & Anr. Vs. Rayani Ramanjaneyulu, III (2014) CPJ 582(NC), wherein gist of the decision is as follows:-

“Consumer Protection Act, 1986 – Sections 2(1)(g), 14(1)(d)- Insurance – Agent’s mistake- Non-disclosure of facts relating to earlier policy- Not material fact- Clam repudiated- Deficiency in service- State Commission allowed complaint- Hence revision- Insured or her legal representatives should not suffer for omissions and commissions by agent- Repudiation smacks of mala fide intention on part of OP- Insurance Company has no bone to pluck with complainant.”

15.    Learned counsel for the respondent further stated that the DLA has shown her income as Rs.1,80,000/- in the proposal form as she was getting the pension of approximately Rs.13,000/- per month after the death of her husband.  She was also having some agricultural income and therefore, the income of Rs.1,80,000/- was totally justified.  In the column of occupation, it was filled as “pensioner”.  Thus, there was no misrepresentation `or concealment of any fact or any information in the proposal form.

16.    I have given a thoughtful consideration to the arguments advanced by both the parties and have examined the material on record.  It is seen that the first policy No.19622312, which commenced from 12.01.2012 and proposal form was filled on 26.12.2011, wherein the income of the DLA has been shown as Rs.1,80,000/- and the profession has been shown as “pension holder”. In the second policy No.50362185, which commenced on 22.09.2012 and its proposal form was submitted on 30.08.2012, wherein the income of the DLA has been mentioned as Rs.4,00,000/- and the profession has been mentioned as “pension holder”.  So far as the question of occupation is concerned, I do not find any discrepancy in the proposal forms and the actual occupation because it has been found that the DLA was a housewife and was getting pension after death of her husband. In the grounds of revision, it is mentioned by the petitioner/opposite party that the DLA was drawing Rs.10,580/-  as monthly pension and therefore, the annual income of Rs.1,80,000/- cannot be justified.  The complainant had claimed that the DLA has having some agricultural income and therefore, annual income of Rs.1,80,000/- cannot be treated as unjustified.  I agree with the contention of the learned counsel for the respondent that there may be some additional income apart from the pension like the interest income and agricultural income, therefore, I do not find that mentioning of Rs.1,80,000/- as income will  amount to any suppression of material information.  In this regard, I am of the view that for Policy No.19622312, there is no concealment of information regarding the annual income or the profession/occupation. 

17.    So far as second Policy No.50362185 is concerned, it is seen that the occupation is mentioned as “pension holder”.  However, the income mentioned has been increased to Rs.4,00,000/- from Rs.1,80,000/-.  The State Commission has not examined the issue of increase in income of the DLA within 8 months.  The State Commission has only observed in its order that the complainant has filed some revenue receipts and the State Commission has treated this as sufficient proof for additional income.  However, no details of such receipts are mentioned in the order of the State Commission.

18.    As the proposal forms are signed by the DLA, their contents are important and it does not matter whether they are filled by the insured or the agent as the contents would be treated to be the information submitted by the insured and the agent may only be treated as a writer on the instruction of the insured.  Hence, I do not find any merit in argument of the learned counsel for the respondent that as the proposal forms have been filled up by the agent, the same cannot be strictly construed.   The complainant had tried to justify the income by submitting a certificate from Chartered Accountant dated 20.04.2011, wherein the income for the financial year 2010-2011 has been certified to be above Rs.15,00,000/-, whereas the agricultural income shown to be Rs.12,00,000/-.  The balance sheet and other papers have also been attached along with certificate.  The case of the insurance Company is that this certificate is a bogus certificate and has not been issued by the Chartered Accountant and the same has been forged by the complainant.  The Insurance Company has stated in their written statement that the Investigator has found that the CA’s certificate and all other documents are forged and have been obtained fraudulently.  The District Forum and the State Commission have not given any finding on the same documents.  Hence the authenticity of these documents is in doubt and no advantage can be given to the complainant on the basis of these documents.

19.    Otherwise also it is not clear if occupation remains the same i.e. as ‘pension holder’, how the income can increase from Rs.1,80,000/- to Rs.4,00,000/- within a period of eight months?  No special circumstances or reasons have been mentioned by the learned counsel for the respondent for explaining such an increase in the income of the DLA.  As no special circumstances seem to be operating during this period of eight months, the increase in the income of the DLA does not seem to be justified and obviously the DLA has resorted to mentioning of increased income to justify a second policy for another Rs.10 lacs. Thus the second policy bearing No.50362185 was definitely obtained by misrepresenting the income by the DLA.  As this policy has run only for about 6 months, the benefit of the Section 45 of the Insurance Act cannot be given in respect of this policy.  Hence, I do not find any irregularity in repudiation of the claim under this policy. 

20.    Based on the above discussion, the revision petition is partly allowed and the petitioner Insurance Company is found only liable to pay the insurance claim in respect of policy No.19622312 which commenced from 12.01.2012.  The insurance claim in respect of the other policy No.50362185 which commenced from 22.09.2012 is not payable.  The orders of the District Forum and the State Commission stand accordingly modified.  The order in respect of compensation of Rs.10,000/- and cost of Rs.2,500/- is maintained. No order as to costs for this revision petition.