3. Opposite party appeared, controverted the allegations of the complainants and resisted their claim. Certain preliminary objections have been raised that complainant No. 2 has not come to the Forum with clean hands as she has concealed material facts with regard to her pre-existing disease/ailment. She has, therefore, no cause of action and locus standi to file the present complaint. On merits, factum of obtaining joint mediclaim insurance policy by the complainants from the opposite party Insurance Company for a sum of Rs.50,000/-each effective from 16/5/07 to 15/5/08 on payment of insurance premium of Rs.1932/- is not disputed. It is however, pleaded that complainant No.2 obtained the mediclaim policy by misrepresenting the facts with regard to her pre-existing ailment as she has Cholecytitis ( Gall Bladder Calculus ) as such no valid contract overcame into existenc. Moreover, she has preferred claim for calculus disease. The policy of the insurance specifically excludes such kind of liability. According to the policy exclusion clause 4.3, the calculus diseases are not covered for first two years.. It is denied that complainant No.2 was hale and hearty at the time of taking hospitalization an domiciliary hospitalization benefit policy. In fact complainant No.2 had been suffering from Cholecytitis ( Gall Bladder Calculus) at the time of applying for the policy. and by misrepresenting the facts they have got themselves insured just to get reimbursement. . The factum of pre-existing ailment i.e. Gall Bladder Calculus was well within the knowledge of complainant No.2 at the time of her applying the policy. which rightly warranted for the repudiation of her insurance claim by the Insurance Company as per exclusion clause 4.3 of the insurance policy because calculus disease are not covered for the first two years. Therefore there is no deficiency in service on the part of opposite party Insurance Company so as to entitle complainants to the reliefs claimed.<br /> 4. In support of his version complainants have produced in evidence affidavit and documents Ex.C1 to C16.<br /> 5. On the other hand opposite party Insurance Company produced in evidence affidavit and documents Ex.R1 toR6.<br /> 6. We have heard arguments of learned counsel for the parties and perused ocular as well as documentary evidence on the record. Learned counsel for the complainant has vehemently urged before us that repudiation letter ex.C15/R5 dated 17/12/2007 based on the opinion of Genins India Ltd. vide Ex.R3 dated 5/10/07 that " policy is first year policy and it has been issued after Ist April, 2007. This claim has incurred for Cholelithiasis ( Gall Bladder Calculus ) according to the policy exclusion clause 4.3, the calculus disease are not covered for first two years which amounts to deficiency in service and also contrary to the terms and conditions of th insurance policy On the other hand counsel for the opposite party has counter-argued that repudiation of mediclaim insurance policy by the opposite party is perfectly justified under condition 4.3 of exclusion clause of the insurance policy and the complainant got mediclaim insurance policy by misrepresenting the facts with regard to her pre-existing ailment on or before applying the policy.<br /> 7. We have considered rival contentions of counsel for the parties. We find a good deal of merit in the contentions of learned counsel for the complainants. These broad facts are not disputed that complainants were insured for mediclaim vide insurance policy Ex.C2/Ex.R2 for the period from 16/5/07 to 15/5/08. This fact is also proved by the complainant No.2 that during the insurance period she was diagnosed for acute Cholecytitis with Choleliathiasis ( Gall Bladder Calculus ) at Ghai hospital, Jalandhar and that she was given medical treatment for Laproscopic Cholecystectomy from 26/8/07 to 28/8/07 and incurred medical expenses to the extent of Rs.24,460/- as per medical bills Ex.C6 to C14. She lodged claim with the Insurance Company vide Ex.C3 dated 30/8/07 for reimbursement of amount of Rs.24,460/- but the same was repudiated under exclusion clause 4 of the insurance policy Ex.R2.<br /> 8. Now adverting to the exclusion clause-4 of the insurance policy Ex.R2 which stipulates that :<br /> "4.0 The Company shall not be liable to make any <br /> payment under this policy in respect of any expenses<br /> whatsoever, incurred by any insured person in the <br /> connection with or in respect of :<br /> 4.1 all diseases / injuries which are pre-existing<br /> when the cover incepts for the first time.<br /> 4.3 During the first year of the operation of the <br /> insurance cover, the expenses on treatment of <br /> diseases such as Cataract, Benign <br /> Prostatic, hypertrophy, Hysterectomy for menorrhegia<br /> or Fibromiom, Hernia, Hydrocele, Congenital internal <br /> diseases, flstula in anus piles sinusitis and related <br /> disorders are not payable if these disease are <br /> pre-existing at the time of proposal, they will be not <br /> be covered even during subsequent period of <br /> renewal too."<br /> 9. This repudiation of mediclaim insurance of complainant No.2 is based on the opinion of Genins India Ltd. Ex.R3 that " this is first year policy and it has been issued after Ist April, 2007. This claim has incurred for Cholelithiasis ( Gall Bladder Calculus ) according to the policy exclusion clause 4.3, the calculus disease are not covered for first two years Hence this claim had been recommended as no claim ". However, in our opinion repudiation of mediclaim insurance was done under erroneous interpretation of clause 4.1 of exclusion clause of the insurance policy as it covers all the diseases which are pre-existing when the cover incepts for the first time. Further clause 4.3 does not specifically exclude Cholelithiasis ( Gall Bladder Calculus ) clause 4.2 read with proviso further lays down that opinion of penal of medical practitioners must certify that insured person could not have known of the existence of the disease or any symptom or complaint thereof at the time of making proposal for the insurance for the Company. However, in the instant case, Insurance Company has dismally failed to prove by positive medical evidence or otherwise evidence that complainant was suffering from Cholelithiasis ( Gall Bladder Calculus at the time of taking the insurance policy from the opposite party Insurance Company nor there was any suppression or fraudulent concealment of the disease in the absence of any proposal form or any prior medical evidence of such disease for which she had to undergo surgical operation for Cholelithiasis ( Gall Bladder Calculus ). Therefore, repudiation of insurance claim of the complainant on the basis of condition No.4(1) of the exclusion clause is perfectly unreasonable, unjustified and arbitrary on the part of Insurance Company. Reliance is also placed upon a case of our own HOn'ble State Commission reported as Oriental Insurance Company Ltd. vs. Chain Singh and another 2006 CTJ 903 SCDRC in which it was clearly held that :<br /> XX XX XX<br /> "The Insurance Company is well within the right <br /> to repudiate a mediclaim if it can show that the <br /> disease was pre-existing at the time of incept <br /> of the initial mediclaim policy. If it cannot so <br /> show, the repudiation of the claim will be wrong."<br /> XX XX XX<br /> 10. It is also relevant to mention that under clause (b) of the note, it is further envisaged that if the insured had not taken any consultation, treatment or medication in respect of the hospitalization, then clause 4.1 did not apply.. Therefore, mere observations in the report of Bharat Lab & Scanning Centre vide Ex.C5 that Appearances suggestive of Chronic Cholecystitis with Cholelithiasis carries no evidentiary value in the absence of past medical record or by affidavit of medical practitioner who had allegedly diagnosed earlier or medically treated complainant No.2 prior to her first time hospitalization.<br /> In the ultimate analysis of aforesaid discussion, we are of the considered opinion that repudiation of just and bonefide mediclaim of complainant No.2 vide letter Ex.R5 dated 17/12/07 is arbitrary and unjustified. We, therefore, accept the complaint and direct the opposite party Insurance Company to release amount of Rs.24460/- with interest $ 9% p.a. from the date of repudiation till realisation and further monetary compensation of rs.5000/- for mental agony and physical sufferings on account of deficiency in service besides Rs.1000/- as cost of litigation within one month from the receipt of copy of this order .<br /> Let certified copies of judgment rendered be supplied/despatched to the parties without any unnecessary delay and thereafter file be consigned to record room.<br /> <br /> Announced : ( Surinder Mittal ) ( A.K. Sharma )<br /> 26.8.2008 Member President.