BEFORE THE DISTRICT CONSUMER DISPUTES
REDRESSAL COMMISSION, JALANDHAR.
Complaint No.91 of 2017
Date of Instt. 03.04.2017
Date of Decision: 27.07.2022
Sarabjit Kaur wife of Late. Sh. Virinder Singh resident of VPO Sarih, Tehsil Nakodar, Distt. Jalandhar.
..........Complainant
Versus
1. M/s Dewan Housing Finance Corporation Ltd. (DHFL), SCO No.13, Ground Floor, Chhoti Baradari, Part-I, Jalandhar through its Manager/Incharge etc.
2. M/s Dewan Housing Finance Corporation Ltd. (DHFL), having its registered office Warden House, Second Floor, Sir PM Road, Fort Mumbai, through its Managing Director/Director/Manager/Incharge etc.
3. M/s DHFL Pramerica Life Insurance Co. Ltd. having its registered office 4th Floor, Building No.98, Cyber City, DLF City, Phase-III, Gurgaon, Haryana through its Managing Director/Director/Manager/Incharge etc.
….….. Opposite Parties
Complaint Under the Consumer Protection Act.
Before: Dr. Harveen Bhardwaj (President)
Smt. Jyotsna (Member)
Sh. Jaswant Singh Dhillon (Member)
Present: Sh. A. P. S. Pathania, Adv. Counsel for the Complainant.
Sh. Vikas Sood, Adv. Counsel for the OPs No.1 & 2.
Sh. Lalit Kakkar, Adv. Counsel for OP No.3.
Order
Dr. Harveen Bhardwaj (President)
1. The instant complaint has been filed by the complainant, wherein it is alleged that the complainant is the wife of deceased Virinder Singh, who had obtained the housing loan from the OPs No.1 and 2. The OPs No.1 and 2 are offering the services for providing the home loans to various customers all over India and as allured by their representations deceased Virinder Singh husband of the complainant was in need of a housing loan, he approached the OP No.1 for the sanctioning of a housing loan and the OP No.2 is the registered head office of the OP No.1 and its Jalandhar branch is directly under the control of the OP No.2 and both the OPs are liable and responsible for all acts and conducts of the financial institution . Therefore, the housing loan for an amount of Rs.19,97,873/- was sanctioned by the OPs No.1 and 2 on 31.03.2014 vide home loan code No.00000300 and the complainant mortgaged her property area measuring about 16 marla 4 sarsai situated at Village Saprol, Tehsil Phagwara, Distt. Kapurthala. The loan was disbursed to deceased Virinder Singh by the OPs No.1 and 2. At that time the OPs No.1 and 2 had deducted the processing fee charged obtained various signatures of deceased Virinder Singh and the complainant being the mortgagor of the property and they were not explained the terms and conditions of the OPs for sanctioning the disbursing the loan amount. The rate of interest was also excessively charged by the OPs No.1 and 2 from the complainant and her deceased husband Virinder Singh. During their entire tenure and life time Virinder Singh repaid the loan amount in equal monthly installments as agreed. The OPs No.1 and 2 further represented to the complainant and her deceased husband that as per their scheme, they have to get the life insurance coverage of deceased Virinder Singh from the OP NO.3 and group credit life scheme was done by the OPs under their tie up scheme and an amount of Rs.97,873/- was charged as premium of the insurance policy which commenced from 31.03.2014 fro 15 years with coverage sum assured of Rs.16,17,873/- and the policy No.GC000006 of the main borrower was issued by the OPs in the name of Virinder Singh having member ID No.949326 and the certificate of insurance and the benefit schedule was issued by OP No.3 after receiving the insurance premium form the husband of the complainant the complainant being the beneficiary and LR and the dependent of the deceased is entitled to claim the insurance amount. After getting the housing loan and the insurance done by the OPs, above said Virinder Singh started repaying the loan amount, but suddenly the husband of the complainant was revealed by the doctors in the year 2014 that he is suffering from cancer and he was advised to get the treatment from Oswal Hospital Ludhiana and he started taking the cameo-therapy and his health improved day by day but later on in the month of December 2015 Virinder Kumar died on 28.12.2015 with the complaint of infection in lungs and the deceased had sudden as ‘Cardiac Arrest’ and he died on the same day in Chhabra Neuro Care Hospital, Jalandhar. Therefore, deceased Virinder Singh was not suffering with any major physical disorder which much be clear from the medical examination conducted by the OPs at the time of providing the insurance to the husband of the complainant. The OPs No.1 and 2 were well aware about this fact of medical problem faced by the husband of the complainant if any and the OPs were duly informed by Virinder Singh during his life time at the time of obtaining the housing loan and accordingly, the medico examination of deceased Virinder Singh was conducted by the OPs from their doctors concerned and after satisfying themselves, the OPs got insured Virinder Singh during his life time. The complainant mortgaged her above said property with the OPs No.1 and 2. The insurance coverage after deducting the huge one time payment of medical insurance was provided to deceased Virinder Singh with the assurances that in case any mis-happening will be there with husband of the complainant they will not have to repay the remaining amount of the housing loan and the insurance coverage will satisfy the entire liability. Subsequent to the death of Sh. Virinder Singh, the complainant being the dependent and legal heir of deceased, lodged her claim with the OPs, but the OPs dilly dallied the matter on one pretext or the other and the OPs asked the complainant that they required the certificate copies of all the documents and accordingly, the documents were submitted to them by the complainant which included the copy of the death certificate, cause of death summary, copy of the insurance policy and its benefit, copy of the housing loan letter, ID proof of the deceased and the complainant, but the OPs did not accede to the requests of the complainant and did not process the insurance claim of the complainant further and later on the OPs issued a letter dated 31.03.2016, vide which they informed that there is no claim on behalf of the company and there is a violation of terms and conditions of the policy and non fulfillment of eligibility and insurability criteria , the OP No.3 declared that the OPs have got the right to avoid the insurance and in light of those circumstances, the membership of Virinder Singh was declared as void and benefits if any shall be forfeited. As per the said letter, it was further informed that the premium of Rs.87,107/- was refunded back to the OPs No.1 & 2. Though the OP No.3 has got no right to declare the insurance claim of the complainant as no claim and further that to refund the above said amount as the OPs after issuing the insurance certificate of more than 2½ years could not do so for refund of this amount and for declaring the same as "No Claim", vide letter dated 31.03.2016. The said letter issued by the OP No.3 is absolutely illegal, unlawful and void abinitio. The complainant also issued a legal notice to the OPs on 20.03.2017, but all in vain and as such necessity arose to file the present complaint with the prayer that the complaint of the complainant may be accepted and the letter dated 31.03.2016 issued by the OP No3 may kindly be declared as illegal, unlawful, null and void and the OPs may kindly be directed to make the payment of insurance claim and further OPs be directed to pay a compensation of Rs.3,50,000/- for causing mental tension and harassment to the complainant and Rs.25,000/- as litigation expenses.
2. Notice of the complaint was given to the OPs and accordingly, OPs No.1 & 2 appeared through its counsel and filed joint written reply and contested the complaint by taking preliminary objections that the present complaint is not maintainable. The present complaint is bad for mis-joinder and non-joinder of necessary parties. The complainant is not a consumer qua the answering OPs as per allegations made in the complaint. It is further averred that the complainant has not come to this Commission with clean hands and has concealed the material facts. One Varinder Singh got the financial assistance from the OPs No.1 and 2 and assured to remit the payment on regular basis. On their assurance the loan was disbursed. At that time the complainant opted to get insurance from the OP No.3 and accordingly, as per their demand and wish the insurance was done. Thereafter, the complainant intentionally committed default. The answering OPs are having no concern with any transaction, communicated, claim, dispute between complainant and the OP No.3. When the OP No.3 sent the premium back to OPs No.1 and 2, the OPs No.1 and 2 adjusted that amount in the balance amount as the complainant had committed the default. On merits, the factum with regard to taking a loan by the complainant is admitted, but the other allegations as made in the complaint are categorically denied and lastly submitted that the complaint of the complainant is without merits, the same may be dismissed.
3. OP No.3 filed its separate written reply and contested the complaint by taking preliminary objections that the instant complaint is false, malicious, incorrect and malafide and is nothing but an abuse of the process of law and it is an attempt to waste the precious time of this Commission as the same has been filed by the complainant just to avail undue advantage. The complaint is thus liable to be dismissed under Section 26 of the Consumer Protection Act, 1986. The above complaint is neither maintainable in law nor on fact and the same is liable to be dismissed in limine. The complainant has not approached this Commission with clean hands. Thus, the present complaint should be dismissed forthwith on the grounds of being malafide, baseless and lacking a bonafide cause of action. The complainant has not approached this Commission with clean hands and suppressed the material facts before this Commission. The claim made by the complainant was repudiated by the OP No.3 for reason of mis-representation of material facts by deceased life insured in proposal form. On merits, the factum with regard to issuance of certificate of insurance to the husband of the complainant is admitted and it is also admitted that the DLI has paid a premium including taxes of Rs.97,873/- and sum assured under Certificate of insurance was Rs.16,17,873/-, but the other allegations as made in the complaint are categorically denied and lastly submitted that the complaint of the complainant is without merits, the same may be dismissed.
4. In order to proved the case of the complainant, the counsel for the complainant tendered into evidence affidavit of the complainant Ex.CA alongwith some documents Ex.C-1 to Ex.C-14 and closed the evidence.
5. In order to rebut the evidence of the complainant, the counsel for the OPs No.1 and 2 tendered into evidence affidavit Ex.OP2/A alongwith some documents Ex.OP2/1 to Ex.OP2/11 and closed the evidence. The counsel for the OP No.3 tendered into evidence affidavit as Ex.OP3/A alongwith some documents Ex.OP3/1 to Ex.OP3/7 and then the evidence of the OP No.3 was closed by order, vide order dated 10.06.2019.
6. We have heard the learned counsel for the respective parties and have also gone through the case file as well as written arguments submitted by the counsel for the OP No.3, very minutely.
7. It is admitted fact that the deceased husband of the complainant obtained the housing loan from the OPs No.1 and 2 and it is also proved that the loan of Rs.19,97,873/- was sanctioned by the OPs No.1 and 2 on 31.03.2014 as per Ex.OP2/2. The loan agreement has been proved as Ex.OP2/5 and the schedule of the loan has been proved as Ex.OP2/6. This fact is also admitted that this loan was sanctioned against depositing the title deed of the property for security of the loan to be given by the mortgagee and the property was mortgaged. Notice of intimation regarding mortgage by way of deposit of title deed has been proved as Ex.OP2/8. Memo of deposit of title deed has been proved as Ex.OP2/9 and copy of sale deed has been proved as Ex.C-12 and demand promissory note Ex.OP2/10. The letter of continuity has been proved as Ex.OP2/11. From all these documents, it is proved that the titled deeds were deposited by the husband of the complainant at the time of availing the house loan from the OPs No.1 and 2. It is proved that at the time of availing the loan, the life of the husband of the complainant was also insured and the husband of the complainant got the life insurance coverage and group credit life scheme was done by the OPs and the premium of Rs.97,873/- was charged with coverage sum assured of Rs.16,17,873/-. The insurance policy commenced from 31.03.2014 for 15 years. The certificate of insurance has been proved as Ex.C-6, welcome letter has been proved as Ex.C-7 and Ex.C-9. So from the above said documents, it is proved that housing loan was availed and the life of the deceased Virinder Singh was also insured. The husband of the complainant Virinder Singh died on 28.12.2015. The death certificate of deceased Virinder Singh has been proved as Ex.C-10. The claim form was submitted by the complainant and the grudge of the complainant is that the OPs sent the letter to the complainant Ex.C-11/Ex.OP3/6, vide which it has been mentioned that no claim is admitted against the company and the membership shall be void and Benefits if any hereunder shall be forfeited. The complainant has challenged the repudiation/no claim letter Ex.C-11/Ex.OP3/6 written by the OPs.
8. The contention of the OP No.3 is that the life of the deceased Virinder Singh was insured on the information provided and declaration made by deceased Virinder Singh in the proposal form on the basis of which the certificate of insurance was issued alongwith terms and conditions and schedule and welcome letter. When the claim was received by the OP No.3, the investigation was initiated and during the course of investigation, it was found that the deceased was suffering from Cancer since October, 2013. He used to undergo treatment from various hospitals like DMC Hospital Ludhiana and Oswal Cancer Hospital, Ludhiana. He also underwent cameo-therapy at DMC Hospital, Ludhiana and radiography also. On the basis of the investigation report and death summary, issued by the Chhabra Neuro Care Hospital, the complainant was informed that her claim cannot be admitted as there was non-disclosure of material fact regarding the pre-existing disease and the amount of premium was refunded in the account of the deceased. Whereas the contention of the complainant is that at the time of insurance, every fact was brought to the notice of the OP No.3 and the husband of the complainant was duly got medically examined by the OPs and no fact has been concealed from the OPs. The claim has wrongly been repudiated.
9. The OPs have proved on record the application for group credit life insurance i.e. proposal form Ex.OP2/4. On the second page of proposal form Ex.OP2/4, there is a questionnaire, vide which the questions regarding the medical health of the insured have been asked and one of the question i.e. Clause 1 (b) states that have you ever suffered or are currently suffering from Cancer, Tumor, Growth or cyst of any kind and the answer has been given by the complainant’s husband as ‘No’. This page has been duly signed by the deceased husband of the complainant. The claim form has been proved as Ex.OP3/4 and the address of the doctor, who declared the death, has been mentioned as Chhabra Neuro Care Hospital, Jalandhar. The death summary has been proved as Ex.C-5. As per this document, the patient Virinder Singh was admitted on 27.12.2015 with complaint of CA Lung. Patient had sudden cardiac arrest and expired on 28.12.2015. The contention of the complainant is that the medical history was explained to the OP No.3 at the time of insurance and he was got medically examined by the OP, but there is no document on the record to show that the medical history was disclosed nor any document has been produced by the complainant to prove this fact nor any medical certificate has been proved to show that he was got medically examined by the OPs. As per the contention of the OPs on the receipt of claim, the investigation was got done and the report alongwith hospital record has been proved by the OPs as Ex.OP3/5. Ex.OP3/5 shows that the cancer related medical documents were collected by the investigator from the house of the nominee i.e. the complainant and from DMC Hospital, which clearly shows that the insured had Lung Metastatic in October, 2013, which was prior to signing, filling the proposal form for getting the insurance and of the discharge summary issued by the DMC Hospital, Ludhiana on 26/28.06.2018 (which is not legible) show that the patient Virinder Singh was admitted in DMC Hospital, Ludhiana on 10.05.2014 with a complaint of fever and altered sensorium for 7 days. It has been mentioned in the reasons for admission and significant finding that the patient is known case of carcinoma of nasopharynx with? lung metastasis (October, 2013). Patient has received 10 cycles of chemotherapy and radiotherapy two weeks back. This clearly shows that in the month of May, 2014, he had already received 10 cycles of chemotherapy and radiotherapy. This shows that this entire procedure was done prior to the obtaining of the insurance. It has specifically mentioned in investigating report that he was suffering from lung cancer, which is metastasis since October, 2013. The radiotherapy diagnoses report also shows that the problem, he was having suggestive of Metastatic. There is an affidavit of the investigator also, who had investigated and procured the medical documents from the house of the complainant and other hospital. So, the documents produced and proved on record by the OPs clearly show that at the time of obtaining the insurance, the material fact of life threatening disease like cancer was not disclosed to the OPs. In a case titled as “Satwant Kaur Sandhu Vs. New India Assurance Co. Ltd.”2009 (4) RCR (Civil) 692, the Hon’ble Supreme Court has referred “the term “Proposal Form” as defined under the Insurance Regulatory and Development Authority, 2002, which provides that proposal form means, form to be filled by the Proposer for insurance, for furnishing all material information required by the insurer in respect of a risk, in order to enable the insurer to decide whether to accept or decline, to undertake risk, and in event of acceptance of risk, to determine the rates, terms and conditions of a cover to be granted and further observed that in a contract of insurance, any facts which would influence the mind of prudent insurer in deciding whether to accept or not to accept the risk is a material fact. If the proposer has knowledge of such fact, he is obliged to disclose it particularly while answering question in the proposal form. In case of non-disclosure of such fact, insurance company would be justified in repudiating the claim.” The Hon’ble Supreme Court has further observed that it is a fundamental principle of insurance law that utmost faith must be observed by the contracting parties. Good faith forbids either party from non-disclosure of the facts which the party privately knows, to draw the other into a bargain, from his ignorance of that fact and his believing the contrary. The Hon’ble Supreme Court has referred MacGillivray on Insurance Law, who has summarized the assured’s duty to disclose as under:-
“The assured must disclose to the insurer all facts material “to an insurer’s appraisal of the risk which are known or deemed to be known by the assured but neither known nor deemed to be known by the insurer. Breach of this duty by the assured entities the insurer to avoid the contract of insurance so long as he can show that the non-disclosure induced the making of the contract on the relevant terms.
It has been held by the Hon’ble National Commission, in a case titled as “Sr. Divisional Manager, LIC of India Vs. Smt. Gangama”, III (2002) CPJ 56 (NC) that suppression of information itself violates the terms of the contract of utmost good faith which is a tenent of insurance policy. It has been held by Hon’ble State Commission in a case titled as “Gurinder Singh Vs. DHFL Pramerica Life Insurance Company”, that where the policy is obtained after concealing the material facts, the insurance company is right in repudiating the claim.
10. In the present case also though the complainant has alleged that the deceased was got medically examined by the insurance company, but as discussed above, no medical certificate to this effect has been proved, even otherwise the material fact regarding the disease of cancer was not disclosed to the insurance company by the deceased husband of the complainant. The policy was obtained in the month of March, 2014 and he died in the month of December, 2015. It has been proved that prior to obtaining the insurance, he was in the knowledge of the fact that he is suffering from this life threatening and dangerous disease of lung cancer, which was metastatic and he had concealed this material fact from the insurance company. It has been observed by the Hon’ble Supreme Court, in a case titled as “Satwant Kaur Sandhu Vs. New India Assurance Co. Ltd.”, that where the existence of a chronic disease at the time of taking out policy is a material fact, in case of non-disclosure of such fact, insurance company would be justified in repudiating the claim. In the present case also, the OPs have rightly issued the letter Ex.OP3/6, after duly investigating the death of the deceased Virinder Singh and after coming to know about the concealment of the disease of Cancer, the claim was not admitted and the amount of premium was refunded in the loan account of the deceased husband of the complainant, which has been adjusted as per the written statement of the OPs No.1 and 2 and as per the record Ex.C13, the loan account has already been closed. So, there is no merits in the case of the complainant and the complainant has failed to prove his case and thus, the complaint of the complainant is dismissed with no order of cost. Parties will bear their own costs. This complaint could not be decided within stipulated time frame due to rush of work.
11. Copies of the order be supplied to the parties free of cost, as per Rules. File be indexed and consigned to the record room.
Dated Jaswant Singh Dhillon Jyotsna Dr. Harveen Bhardwaj
27.07.2022 Member Member President
