Date of filing:21.5.2013

                                                                                                       Date of Disposal:6.3.2014

BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM-II::

VIJAYAWADA, KRISHNA DISTRICT.

        Present: SRI A. M. L. NARASIMHA RAO, B.SC., B. L., PRESIDENT

                                   SMT N. TRIPURA SUNDARI, B. COM., B. L., MEMBER

                                   SRI S.SREERAM, B.COM., B.A., B.L.,            MEMBER

       THURSDAY, THE 6^TH DAY OF MARCH, 2014.

C.C.No.92 OF 2013.

Between :

Smt Medisetty Nagamalleswari, W/o Late Venkata Krishna Rao, Hindu, 29 years, Running Flour Mill, Kethanakonda Village, Ibrahimpatnam Mandal, Krishna District.

              ….. Complainant.

And

1. The Branch Manager, Met Life India Insurance Company Limited, Opp:Seshasai Kalyanamandapam, M.G.Road, Vijayawada.

2. Met Life Insurance Company Limited, Rep., by its Managing Director, Registered Office: Brigade Seshamahal, 5 Vani Vilas Road, Basavanagudi, Bangalore – 560 004.

…..Opposite Parties.

This complaint is coming before us for final hearing on 19.2.2014 in the presence of    Sri D.Ravi Kiran, Counsel for complainant and opposite party No.1 remained absent and      Sri Ch.Suresh Kumar, Counsel for opposite party No.2 and upon perusing the material available on record, this Forum delivers the following:

O  R  D  E  R

(Delivered by Hon’ble Member Sri S.Sreeram)

This complaint is filed by complainant under Section 12 of Consumer Protection Act, 1986 directing the opposite parties to pay a sum of Rs.15,00,000/- towards the face amount of insurance to the complainant along with interest at 12% p.a. from the date of repudiation till the date of payment, grant compensation of Rs.1,00,000/- and costs of Rs.10,000/- and for other reliefs.

1.         The brief averments of the complaint are as follows:

            The complainant submitted that her husband Medisetti Venkata Krishna Rao during his life time had subscribed for a policy “MET SURAKSKHA REGULAR PREMIUM” of opposite parties bearing No.20583305 by paying a premium of Rs.3,700/- on 27.5.2011 for a face insurance amount of Rs.15,00,000/- and accidental death benefit of Rs.10,00,000/- in total Rs.25,00,000/- covering risk on his life after being induced by the agent of opposite parties.   The date of commencement of the policy is 21.5.2011 and the term of policy is 25 years.  While so, the life insured died due to heart attack at Praveen Cardiac Center, Vijayawada and after his death, the complainant being the nominee of the life insured made a claim to the opposite parties to a tune of Rs.25,00,000/-.  Thereupon the opposite parties got the investigation done through their investigator and repudiated the claim of the complainant vide their letter dt.13.9.2012 stating that the life insured had suppressed the material fact with regard to his income, which is unfair, unjustified and not bonafide and it amounts to deficiency of service on the part of opposite parties.  In the first instance, as the complainant claimed Rs.25,00,000/-, a complaint was filed before Hon’ble State Commission, Hyderabad.  But later the complaint was returned to complainant with an observation that the life insured died due to heart attack, which is not an accidental and as such the complainant is entitled to seek Rs.15,00,000/- only and directed to file it before appropriate Forum.  As such the present complaint is filed before this Forum.

2.         After registering the complaint, notices were sent to the opposite parties. The opposite parties made their appearance and filed version denying the material allegations made in the complaint and contended that the life assured had suppressed the material facts with regard to his income and stated in the proposal form that he had been running flour mill in the name of Malli flour Mill, Vijayawada and his annual income is Rs.10,00,000/-, but their investigation discloses that the deceased was an auto driver and his annual income is substantial lower than the declared income, which is Rs.45,000/-.  It is contended that the deceased suppressed the said fact and obtained policy and as such the repudiation of policy is justified. The opposite parties apart from making the above contentions quoted several decisions of the various Apex Courts in support of its contentions and finally prayed to dismiss the complaint.

3.         During the course of enquiry, the complainant filed her affidavit and affidavit of a third party and got marked Ex.A1 to Ex.A12.  On behalf of opposite parties, Ex.B1 to Ex.B4 are marked.

4.         Heard both sides and perused the record.

5.         Now the points that arise for consideration in this complaint are:

1. Whether there is any deficiency in service on the part of the opposite parties 1 and 2 in repudiating the claim of complainant?

1. If so is the complainant entitled for the reliefs as prayed for?

POINT NO.1 :

6.         On perusing the material on hand (complaint, affidavit and documents), there is no dispute with regard to the taking of policy by deceased Medisetty Venkata Krishna Rao from the opposite parties during his life time.  Ex.A2=Ex.B1 proposal forms discloses the fact that the deceased applied for insurance with the opposite parties. It is also not in dispute that the complainant herein is nominee under the said policy.   The opposite parties also not denying the face value of insurance amount as Rs.15,00,000/- and the existence of policy.  The grievance of the complainant is that, while the insurance is in force, the life assured died due to heart attack on 9.6.2011 at Praveen Cardiac Center, Vijayawada and after his death, the complainant being nominee under the policy made a claim to the opposite parties, which was repudiated vide Ex.A1=Ex.B4 repudiation letter on the ground that the life assured made misrepresentation and misstatement regarding his income and basing on which, the policy was issued.  In this regard, the case of complainant is that the life assured has not suppressed any fact with regard to his income and that the deceased had run a flour mill till his death apart from part time supply of drinking water in the village through his own auto during morning hours and the flour mill was in existence even today in the premises of complainant and as such there is no suppression of fact.  On the other hand, the contention of the opposite parties is that, after the death of deceased, they investigated into the matter through their investigator and as per the investigator report, the deceased was running two autos and his annual income was only Rs.45,000/- and that the said autos were also seized by financiers due to non payment of installments and as such the deceased could not bear the shock and suffered from massive heart attack and died in the hospital.  The death of deceased is evident from Ex.A3 death certificate and Ex.A4 death summary issued by Praveen Cadiac Center, Vijayawada.

7.         In view of the rival contentions and in view of the circumstances of the case, the only point that need to be considered is that the ground taken by the opposite parties in repudiating the claim of complainant is valid or not.  Admittedly the life assured took the policy on 20.5.2011, which is evident from proposal form (Ex.A2=Ex.B1).  Further record discloses that the life assured died on 9.6.2011.  As such the said policy is in force on the date of death of deceased.  Section 45 of the Insurance Act provides that no policy shall be called in question after expiry of two years from the date of which it was issued.  In the instance case, the husband of complainant died within two years from the date of proposal and as such the opposite party has got every right to enquire into the matter and accordingly they investigated into the matter and at the time of investigation, they came to know that the deceased was running two autos and his annual income is only Rs.45,000/-, but at the time of proposal, the life assured made misrepresentation that he was running flour mill and getting Rs.2,00,000/- as annual income.  As seen from the proposal form, the occupation details (Q.No.14) are filled as

8.         Further as seen from the record, the complainant in support of her contention that the deceased had been running Flour mill for the last two years prior to taking policy has filed Ex.A6 to A12 which are material documents.  Ex.A6 is the form of way bill dt.11.08.2009 which discloses that one T.Rambabu of Ketanakonda purchased the flour mills, one motor and stand from Jyothi Mill Stores, Vijayawada for Rs.30,000/-. Ex.A7 is the cash bill for Rs.30,000/- issued by said Jyothi Mill Stores, Vijayawada in favour of T.Rambabu evidencing the payment towards purchase of flour mills etc.,  Ex.A8 is the electricity bill issued in the name of complainant and Ex.A9 is the application made by complainant under Right to Information Act. Ex.A10 is the certificate issued by Asst. Engineer, Operation, APSPDCL, Ibrahimpatnam to the effect that the Service connection Number mentioned in Ex.A8 has been released in the name of complainant under Cat-II on 29.9.2009 and that on inspection of service, the above service is being used for flour mill and chilli powder mill.  Ex.A12 is the certificate issued by Panchayat Secretary, Kethanakonda to the effect that the complainant has been running flour mill in the said village and prior to the death of husband of complainant, the husband of complainant Medisetty Venkata Krishna Rao had been running the flour mill.  Further the complainant got filed the affidavit of one T.Rambabu from which the complainant’s husband purchased the flour mill to substantiate her contention.  As such the complainant has proved that the life assured had been running flour mill in the village during his life time and at the time of taking policy and after his death, the complainant has been running the same.  The opposite parties except for relying on the investigator’s report, has not placed any material in the shape of documentary evidence to prove that the life assured had not run the flour mill and his annual income is not Rs.200000/- as mentioned in the proposal form.  As the life assured had clearly mentioned in the proposal form that his annual income is Rs.200000/-, the opposite parties authorities at that juncture itself before issuing policy ought to have verified whether the income declared in the proposal form is true or not.  The investigation made by the opposite parties after the death of life assured ought to have done before issuance of policy to ascertain the truth or otherwise with regard to the income of life assured.  Having issued the policy and the death of deceased is not in dispute, at this juncture the opp.parties are not justified in repudiating the claim.  There was no suppression by the insured with respect to his profession when he clearly stated in the proposal form that he was proprietor of Flour Mill, it was up to the insurance company to have conducted an enquiry with respect to his earnings.  The opposite parties have failed to establish that there was willful and fraudulent suppression of material facts which ought to have been disclosed by the life assured with respect to his income. In this regard, the complainant relied upon the decision of the Hon’ble National Consumer Disputes Redressal Commission, New Delhi in Revision Petition No.519/2007 in which the facts and circumstances of the case are applicable to the facts on hand.

9.         In view of the foregoing discussion, we are of the considered opinion that the ground taken by opposite parties in repudiating the claim is not valid and there is any amount of deficiency in service on the part of opposite parties.  But in the circumstances of the case, we are not inclined to grant any compensation.

POINT No.2:-

10.       In the result, the complaint is allowed and the opposite parties 1 and 2 are directed to pay a sum of Rs.15,00,000/- (Fifteen lakh rupees only) to the complainant with interest at the rate of 9% per annum from the date of repudiation i.e., 13.9.2012 till realization besides costs of Rs.2,000/- (Two thousand rupees only).  Time for compliance is one month from the date of receipt of this order. The other claims of the complainant shall stands dismissed.

Typewritten by Stenographer K.Sivaram Prasad, corrected by me and pronounced by us in the open Forum, this the 6^th day of March, 2014.

PRESIDENT                                                      MEMBER                                                MEMBER

APPENDIX OF EVIDENCE

WITNESSES EXAMINED

For the complainant:                                                        For the opposite parties:-

P.W.1  Smt M.Nagamalleswari                                                      None.                                                 Complainant                                                                                      

            (by affidavit)

P.W.2 T.Rambabu,

            Third Party,

            (by affidavit)

DOCUMENTS MARKED

On behalf of the Complainant:

Ex.A.1                        13.09.2012    Claim Decision Letter. from the 2^nd opposite party to the

complainant.

Ex.A.2            20.05.2011    Photocopy of application form.

Ex.A.3            27.12.2011    Certificate of death.

Ex.A.4                .    .              Photocopy of Death Summary issued by Praveen Cardiac Centre,

Vijayawada.

Ex.A.5            28.03.2013    Oral Order copy of A.P. State Consumer Disputes Redressal

Commission, Hyderabad in CC.Sr.No.1059/2013.

Ex.A.6            11.08.2009    Form of Way Bill.

Ex.A.7            02.08.2009    Cash Bill issued by Jyothi Mill Stores (Agencies) Vijayawada for

Rs.30,000/-.

Ex.A.8            19.08.2013    Current consumption bill/notice for Rs.300/-.

Ex.A.9            03.11.2013     Photocopy of letter from the complainant to the Public Information

Officer, O/o Assistant Divisional Engineer, Ibrahimpatnam, Krishna

District.

Ex.A.10          23.11.2013    Certificate issued by Southern Power Distribution Company of A.P.

Limited.

Ex.A.11          19.11.2013    Miscellaneous Receipt issued by Panchayat Secretary,

Ibrahimpatnam Mandal.

Ex.A.12          19.11.2013    Certificate issued by Panchayat Secretary,Ibrahimpatnam Mandal.

On behalf of the opposite parties:-

Ex.B.1                        20.05.2011    Photocopy of application form.

Ex.B.2                .    .              Photocopy of Death/Disability/Critical Illness Claim Intimation along

with photocopies of Certificate of Death of the husband of the

complainant, condolence letter, additional requirement letter and

acknowledgement letter from the 2^nd opposite party to the

complainant.

Ex.B.3            21.12.2011    Photocopy of letter from the 2^nd opposite party to Mr.Satish

Kumar.R. Spurthi Group, Bangalore and photocopies of letter of

authorization, investigation report Summary, E-mail letter and a

receipt issued by Shriram Transport Finance Company Ltd., for

Rs.7,800/-.

Ex.B.4            13.09.2012    Photocopy of claim decision letter from the 2^nd opposite party to

the complainant and photocopy of cheque of HDFC.

                                                                         PRESIDENT