A.P. STATE CONSUMER DISPUTES REDRESSAL COMMISSION
AT HYDERABAD.
F. A. 519/2008 against C.C. 9/2005, Dist. Forum, Khammam
Between:
TATA AIG General Insurance Company Ltd.
Raheja Towers, 9th Floor,
Beta Wing, 177, Anna Salai
Chennai *** Appellant/
O.P. No. 2
And
1. Thumula Kalpana,
D/o. Venkateswarlu Kondaiah
Age: 20 years, Student
R/o. 1-80, Kusumanchi Road
Nelakondapalli (M)
Khammam.
Presently at Pandurangapuram
Khammam (Urban Mandal) **** Respondent/
Complainant
2. Road Safety Club Pvt. Ltd.
2A, II Floor, Prakasham Road,
T. Nagar, Chennai-600 017 *** Respondent/
O.P. No. 1.
Counsel for the Appellant: M/s. K. Kishore Kumar Reddy
Counsel for the Resps: M/s. V. Srinivasa Rao- R1
M/s. K. Maheshwara Rao- R2
CORAM:
HON’BLE SRI JUSTICE D. APPA RAO, PRESIDENT
&
SMT. M. SHREESHA, MEMBER
MONDAY, THIS THE TWENTY FITH DAY OF OCTOBER TWO THOUSAND TEN
Oral Order: (Per Hon’ble Justice D. Appa Rao, President)
*****
1) This is an appeal preferred by the insurance company against the order of the Dist. Forum directing it to pay Rs. 2,25,000/- with interest from the date of complaint till the date of realization.
2) The case of the complainant in brief is that she being a member of Road Safety Club entitled to Group Personal Accident policy issued by the appellant covering the personal insurance coverage from 25.4.2003 to 24.4.2004 wherein the assured would be entitled to Rs. 3 lakhs in case of accidental death, Rs. 3 lakhs in case of total permanent disability, Rs. 3 lakhs in case of temporary total disability in addition to weekly benefit amount @ Rs. 1,000/- per week for 104 weeks. While so on 26.6.2003 at about 2.30 p.m. when she was collecting green gram placed on the building slab, she came into contact with high tension electrical wire, sustained shock to her right hand, right arm and right toe and the total body was paralysed due to burn injuries. She was immediately admitted in Mamata General Hospital, Khamam and later she was shifted to NIMS, Hyderabad where she underwent three surgeries for shortening of distal forearm by excision of about 6 cm of radius and ulna wrist fusion. She had incurred expenses of Rs. 3 lakhs for the above said surgeries and for treatment. She has been bed ridden from the date of electrical shock. Since she had permanent total disability she was entitled to Rs. 3 lakhs, however only Rs. 75,000/- was paid. Therefore she claimed balance of Rs. 2,25,000/- with interest, compensation and costs.
3) Opposite Party No. 1 Road Safety Club resisted the case. While admitting issuance of club membership to the complainant and coverage of group personal accident policy it denied its liability. It alleged that it was only a facilitator. On receipt of claim from the complainant, it has forwarded the same to R2 insurance company which in turn settled the claim at Rs. 75,000/- as per the terms of the policy. It alleged that having received the amount towards full and final satisfaction she was estopped from filing the complaint. At any rate, if there is any claim, it has to be settled by R2 insurance company. There was no negligence nor deficiency in service on its part and therefore prayed for dismissal of the complainant with costs.
4) The insurance company resisted the case. While admitting issuance of policy however it denied injuries to the right hand, right arm and right foot and that total body was paralysed due to which she has been bed ridden. After thorough enquiry it had settled the claim for Rs. 75,000/- being 75% of permanent partial disability and that the amount was paid towards full and final settlement on informing that she would not claim any more amounts. She turned round and filed this complaint with ulterior motive. At any rate she had to file the complaint before an arbitrator as per the terms of the agreement. At any rate disputed questions of fact and law are involved and that Civil Court would be competent to adjudicate the matter. Therefore it prayed for dismissal of the complaint with costs.
5) The complainant in proof of her case filed her affidavit evidence and got Exs. A1 to A18 marked while the insurance company examined Sri Jayantha Reddy, Manager (Claims) working with the appellant as RW1 and filed Exs. B1 to B3.
6) The Dist. Forum after considering the evidence placed on record opined that the injury that she had sustained was temporary total disability entitled to Rs. 3 lakhs. As against it an amount of Rs. 75,000/- was paid and the appellant was liable to pay balance of Rs. 2,25,000/-. Damages and costs were not awarded.
7) Aggrieved by the said decision, the appellant insurance company preferred the appeal contending that the Dist. Forum did not appreciate either facts or law in correct perspective. It ought to have seen that an amount of Rs. 75,000/- was paid towards full and final settlement evidenced under discharge voucher Ex. B3 dt. 31.8.2004. It was for the first time the plea that it was executed under coercion was introduced. As per coverage for permanent partial disability the amount payable is Rs. 1 lakh only, and therefore, at the most, she was entitled to Rs. 25,000/-. The Dist. Forum has no jurisdiction and therefore prayed for dismissal of the complaint with costs.
8) The point that arises for consideration is whether the order of the Dist. Forum is vitiated by mis-appreciation of fact or law?
9) It is not in dispute that the appellant insurance company issued Group Personal Accident Policy covering the period from 25. 4.2003 to 24.4.2004 as mentioned in Ex. B2 (A2) as under :
The capital sum insured shall be :
For accidental death Rs. 3 lakhs
Accidental dismemberment
Permanent total disability up to Rs. 3 lakhs
Temporary total disability Rs. 3 lakhs
Weekly benefit amount up to Rs. 1,000/- per week
(to a maximum of 104 weeks)
At this juncture it is curious to note that altogether a contrary stipulation is mentioned in Ex. B1 as follows:
“When as a result of injury occurring under the circumstances described in a hazard and commencing with 365 days from the date of the accident you suffer a permanent partial disability. We will pay, provided such disability has continued for a period of 12 consecutive months and is continuous and permanent at the end of this period, a percentage of the principal sum shown in the policy schedule if injury to you results in one of the losses shown in the scale below less any other amount paid or payable under the accidental dismemberment, or permanent total disability, or permanent total loss of use sections of this policy as the result of the same accident.
Scale: Percentage of principal sum
- Loss of toes – all 20%
Great toe 5%
Other than great toe, if more than one toe lost, each 1%
- Loss of hearing – both ears 50%
- Loss of hearing - one ear 25%
- Loss of four fingers and thumb of one hand 40%
- Loss of four fingers 25%
- Loss of thumb 15%
- Loss of index finger 10%
- Loss of middle finger 6%
- Loss of ring finger 5%
- Loss of little finger 4%
Loss with regard to :
a) Toe, finger, thumb means actual complete severance from the foot or hand
b) Hearing means entire and irrecoverable loss of hearing.
When more than one form of disability results from one accident, we add the percentage from each together. However, we will not pay more than 100% of the sum insured shown in the policy schedule.
If claim is payable for loss or loss of use of a whole member of the body, a claim for parts of that member cannot also be made.
For a permanent partial disability which is not provided for above, we may still be able to make a payment up to a maximum of 25% of the principal sum listed in the policy schedule.
We will assess at our discretion any disability not specifically mentioned by considering the nature of the disability alongside the percentage given to the specific types of disability above. The insured person’s occupation will not be a relevant factor.
If the insured person has an existing medical condition and they suffer injury, we will assess:
a) Whether the insured person’s medical condition has contributed to their disability, and
b) Whether the disability makes the insured person’s medical condition worse.
In either case we will assess the difference between the insured person’s medical condition before, and their disability after the accident. Any payment, we make will be based on the difference, expressed as a percentage and applied to the appropriate benefit above or in the scale.”
10) We need not state that the appellant having issued Ex. A2 (Ex. B2) certificate of insurance mentioning the amounts for which the policy was issued, it would be binding on them. They cannot turn round and contend that an amount of Rs. 1 lakh could be paid for temporary total disability.
11) Admittedly the complainant has sustained very heavy burn injuries when she came into contact with high tension electrical wire whereby her right hand, right arm, right foot were burnt. She was admitted in Mamata General Hospital, Khammam and later to NIMS, Hyderabad. Evidently her claim was settled even before her injuries were healed. The disability was assessed at 75% albeit, total temporary partial disability that was on 26.11.2003 vide Ex. A9. It is not in dispute that the complainant underwent three surgeries at NIMS, Hyderabad spending more than Rs. 3 lakhs evident from Exs. A11 to A13, A17. When the complainant was still taking treatment there was no hurry for the insurance company to settle the claim towards full and final settlement. In fact it had settled the claim for Rs. 75,000/- by taking advantage of discharge voucher executed by the complainant Ex. B3 as if it was towards full and final settlement. It is not known as to how they could settle the claim for Rs. 75,000/- towards full and final settlement, assuming without admitting that it was only temporary total disability.
12) When RW1, Manager (Claims) was cross-examined he admitted that “ It is true that the complainant took treatment at NIMS hospital at Hyderabad till 7.5.2005 as per the exhibits filed by the complainant. I do not know under what condition she has accepted the amount of Rs. 75,000/- on 26.8.2004 towards full and final settlement. It is not true to suggest that the complainant claimed Rs. 3 lakhs and we paid Rs. 75,000/- towards full and final settlement as per Ex. B3 under coercion. It is not true to suggest that only to avoid payment we had issued Ex. B1 subsequently i.e., on 29.4.2003. It is not true to suggest that under miserable conditions by coercion we took advantage and paid Rs. 75,000/-. It is not true to suggest that we are liable to pay Rs. 3 lakhs.”
13) The complainant not only examined herself but also filed discharge record maintained by NIMS, Hyderabad and the amounts spent towards bills and the tentative certificate Ex. A9 would show that she had 75% disability even before operations. On 26.11.2003 Chairman, Dist. Medical Board, Khammam issued the disability certificate at 75% before the operations and obviously in order to have some amount for further treatment, approached the insurance company, which had paid Rs. 75,000/- evidenced under discharge voucher Ex. B3. At this juncture, we may state that the insurance company without assured having completed her treatment and when she needed three more operations, could not have settled the claim in order to benefit itself. The principle of ubremia fides not only applies to the assured but also to the insurance company. They cannot take advantage of discharge voucher executed by a girl hardly aged about 20 years and deny the claim on the ground that she herself had executed such a discharge voucher. RW1 could not explain as to how and why a discharge voucher could be taken when she was taking treatment as though it was towards full and final settlement. They knew that the parties will be in desperate need of money to discharge some of their liability to the hospital. Unfortunately the insurance companies are taking advantage of the plight of the assured for settling the claims at lower amount than what was legally payable to them. It amounts to unfair trade practise. When the very facts disclose that the complainant had underwent three surgeries at NIMS, Hyderabad which RW1 himself admitted, the very settlement of claim by the insurance company during the course of treatment towards full and final settlement cannot be up-held. These facts would itself speak that so called settlement was made when she had no other go than to subscriber her signature. It undoubtedly amounts to coercion or undue influence whatever term one can use in such circumstances. The insurance company cannot absolve its liability by paying pittance and that too without any basis when she was entitled for more amount under the policy. The complainant had established that though it may not be permanent total disability it was temporary total disability pertaining to her hands, legs etc., entitled to Rs. 3 lakhs as per Ex. A2 (Ex. B2).
14) The learned counsel for the appellant in his written arguments had categorically mentioned that as per the terms of the policy the complainant is only entitled to Rs. 1 lakh and she had already received Rs. 75,000/-, and at the most she was entitled to Rs. 25,000/-. If that were to be so, there is no reason why they had taken discharge voucher towards full and final settlement by paying pittance. They knew full well that the complainant was entitled to Rs. 3 lakhs and hastily even without completion of treatment, obtained the discharge voucher which in the circumstances cannot be up held. It is settled law that mere execution of discharge voucher not always deprives complainant from preferring claim (vide Oriental Insurance Company Vs. S. Sunderpal Singh II (2004) CPJ 105).
15) The learned counsel for the appellant relying a decision Oriental Insurance Company Ltd. Vs. Munimahesh Patel reported in IV (2006) CPJ 1 (SC) contended that when complex factual position requires matter to be examined by appropriate court of law the Consumer Fora not justified to deal with matter. That was a case where there was mis-declaration in proposal form and false claim that insured was a teacher, which was not correct. In those circumstances and in the light of facts emerged therein the Supreme Court opined that Commission ought not to have resolved the matter. However, we may also state that the Hon’ble Supreme Court in Amar Jwala Paper Mills (India) Vs. State Bank of India reported in (1998) 8 SCC 387, AIR 1999 SC 3494 held that “ Admittedly, all the evidence, oral and documentary, that both sides had to lead was led before the Commission and that concluding arguments were in progress when the impugned order was passed. It cannot be that the complexity of the matter was only discovered at the stage of the concluding arguments. Relegating a complaint four years after the filing of the complaint to a civil suit might mean that the complainant has no remedy at all because limitation would have run against him.”
16) To sum up, the complainant could establish that she had temporary total disability entitled to a sum of Rs. 3 lakhs evidenced from Ex. A2 (Ex. B2) and in the light of surgeries she underwent at NIMS, Hyderabad for the injuries sustained in an accident she was entitled to Rs. 3 lakhs. The Dist. Forum has rightly directed the insurance to pay Rs. 2, 25,000/- with interest @ 9% p.a., from the date of complaint till the date of realization she having received Rs. 75,000/- under discharge voucher Ex. B3. The Dist. Forum did not award either compensation or costs. We do not see any mis-appreciation of fact or law by the Dist. Forum in this regard. We do not see any merits in the appeal.
17) In the result the appeal is dismissed with costs computed at Rs. 5,000/-. Time for compliance four weeks.
1) _______________________________
PRESIDENT
2) ________________________________
MEMBER
Dt. 25. 10. 2010.
*pnr
“UP LOAD – O.K.”
