1.       The present Revision Petition (RP) has been filed by the Petitioner against Respondent as detailed above,  against the order dated 18.06.2019 of the State Consumer Disputes Redressal Commission Andhra Pradesh (hereinafter referred to as the ‘State Commission’), in First Appeal (FA) No. 353 of 2016  in which order dated 18.02.2016 of  Srikakulam District Consumer Disputes Redressal Forum (hereinafter referred to as District Forum) in Consumer Complaint (CC) no. 19 of 2013 was challenged, inter alia praying for setting aside the order of the State Commission and District Forum dated 18.06.2019 and 18.02.2016 respectively.

2.       While the Revision Petitioner(s) (hereinafter also referred to as OPs) were Appellants before the State Commission and OPs before District Forum, the Respondent (hereinafter also referred to as Complainant) was Respondent before the State Commission and Complainant before the District Forum.

3.       Notice was issued to the Respondent(s) on 12.09.2019. Parties filed Written Arguments/Synopsis  on     25.02.2023   ( Petitioner )   and   21.04.2023 ( respondent)  respectively.

4.       Brief facts of the case, as emerged from the RP, Order of the State Commission, Order of the District Commission and other case records are that Complainant is the wife of late Madhava Rao @ Manmadhna Rao ( life assured).  The life assured obtained a policy from the OP for sum assured of Rs.4,96,000/- on yearly premium of Rs.14,862/-, commencing from 23.12.2010 to 22.12.2020.  The life assured died non 23.04.2012 due to fever and jaundice.  The wife of the life assured i.e. Complainant submitted claim application to the OPs for settlement of insurance claim.  On 29.12.2012, the OPs repudiated the claim of the complainant on the ground that life assured suppressed the material facts in the proposal form.  Being aggrieved of the repudiation, the Complainant filed CC before the District Forum and District Forum vide order dated 19.6.2013 allowed the Complaint of the Complainant.  Being aggrieved, the OPs preferred an Appeal before the State Commission and State Commission vide order 07.11.2014 remanded the matter back to the District Forum on the ground that OP Nos. 1 and 2 were not present before the District Forum and the order was passed after hearing the counsel for the Complainant alone.  On remand of the matter from the State Commission, the District Forum vide order dated 18.02.2016 allowed the Complaint of the Complainant.  Being aggrieved, the OPs preferred an Appeal before the State Commission and State Commission vide order dated 18.06.2019 dismissed the Appeal of the OPs.  Therefore, the Petitioners ( OPs) are before this Commission now in the present RP.

5.       Petitioner(s) have challenged the said Order dated 18.06.2019 of the State Commission mainly on following grounds:

1. The Fora below ought to have relegated the matter to the Civil Court having jurisdiction as Hon’ble Supreme Court and National Commission have held that complex factual questions which involves detailed trail and examination should be related to civil court having jurisdiction.  The cases where cheating and fraud are alleged, should be relegated to Civil Court. Reliance has been placed on the findings of the Apex Court in Oriental Insurance Co. Ltd. Vs. Munimahesh Patel (2006) 7 SCC.

2. The Consumer Protection Act, 1986 is not applicable to the present case.  The concept of ‘deficiency’ as defined under section 2 (g) of the Consumer Protection Act does not apply to a policy of life insurance in view of Section 45 of the Insurance Act, 1938.   The avoidance of a policy of life insurance is limited to the extent as specified in Section 45 of the Insurance Act, 1938.  Therefore, once it is demonstrated the life assured had obtained policy by non-disclsoure, it gives a cause of action to the insurer to avoid the policy commitment.

3. The life assured was suffering from Chronic Kidney Disease Stage -5, End stage Renal Disease on maintenance Haemodialysis and had taken treatment at Apollo Hospital, Vishakapatnam from 11.06.2010 to 19.06.2010, prior to the date of proposal.  This fact has been falsely answered in the proposal form by mentioning that he was not suffering from any of the diseases mentioned in Coloum No. 19 and 22 of the proposal form. 

4. The deceased husband of the complainant chose not to disclose his medical conditions and got the policy issued by suppressing material facts.

6.       Heard counsels of both sides.  Contentions/pleas of the parties, on various issues raised in the RP, Written Arguments, and Oral Arguments advanced during the hearing, are summed up below.

6.1     Learned counsel for the Petitioner  apart from arguing the points which have been stated in para 5 argued that shortly upon receipt of the death claim from the respondent, the Petitioners initiated investigation into the medical antecedents of the deceased life assured thereby procuring several medical certificates which confirmed that life assured had undergone treatment for Chronic Kidney Disease Stage 5, End stage Renal Disease on maintenance Haemodialysis and had taken treatment at Apollo Hospital, Vishakapatnam from 11.06.2010 to 19.06.2010, prior to the date of proposal i.e. 20.12.2010. Since the said fact has not been disclosed by the life assured,  complainant is not entitled for the claim.  It is further argued that District Forum erroneously allowed the Complaint of the respondent by discarding the vital evidence adduced by the Petitioners on the ground that Petitioner had not examined the doctor who treated the life assured, the discharge summary was not signed by the treated doctor and also on the ground that it does not reflect the father’s name / village name of the deceased life assured. 

6.2.    It  is further argued that Fora below failed to appreciate that description of the patient in discharge summary clearly matched with the descriptions mentioned in the proposal form as well as in the policy of the deceased life assured.  Further, the Fora below failed to appreciate the witnesses RW1 and RW-2 who are Senior Medical Officer and Medical Coordinator / Superintendent in Apollo Hospital respectively.  Learned counsel by relying on the judgment of the Apex Court in Reliance Life Insurance Co.Ltd. and Anr. Vs.Rekhaben Nareshbhai Rathod (2019)  6 SCC argued that in terms of Section 45 of the Insurance Act, 1938, repudiation was legal and valid.  It is further argued that the Fora below did not appreciate the law down in V. Kishan Rao Vs. Nikhil Super Speciality Hospital and Anr. (2010) 5 SCC 513, Malay Kumar Ganguly Vs. Dr. Sukumar Mukherjee and Ors. (2009) 9 SCC 221.

6.3.    Learned counsel for the Respondent argued that there are concurrent findings of both the Fora below.  Further,  the additional documents sought to be filed is misleading and cannot be looked into.  It is further argued that State Commission vide order dated 17.11.2014 while remanding the matter to the District Forum gave an opportunity to both sides to submit fresh material, if any, in support of their contentions but the Petitioners did not file any material before the District Forum.   Further, the repudiation letter did not contain any material particulars with regard to the previous illness, date of joining, name of the hospital and name of the doctor and investigating person.  Further, except the previous illness, the OP did not disclose any particulars in their written version.   The Complainant specifically informed the OPs that life assured died on 23.04.2012 due to fever and jaundice.

6.4.    Learned counsel for the Respondent relied on the following judgments of the Hon’ble Supreme Court :

a.       Rubi (Chandra) Dutta Vs. United India Insurance Co. Ltd. – 2011 (11) SCC 269.

b.       Lourdes Society Snehanjali Girls Hostel Vs. H&R Johnson (India) Ltd. (2016) 8 SCC 286.

c.       Sunil Kumar Maity Vs. State Bank of India and Anr. – Civil Appeal No. 432 of 2022

d.       Momma Gown Vs. Scooter India Ltd. 2014 (1) SCC 307

7.       We have carefully gone through the orders of the State Commission, District Forum, other relevant records and rival contentions of the parties.  In this case there are concurrent findings of both the Fora below as regards the deficiency in service on the part of the Insurance Company.  The claim of the respondent has been repudiated by the Insurance Company vide repudiation letter dated 29.12.2012 on the ground of suppression of material facts with regard to the pre existing ailments.  The extract of relevant paras of the repudiation letter is reproduced below :

“We would like to inform you that the company had covered the risk for the above said policy on the basis of the facts mentioned in the proposal form. However, on receiving the death claim intimation for the above said policy, the various investigations done, the various medical records received reveal certain facts, which were known to the deceased life assured and were not disclosed to us. Hence the death claim under above mentioned policy has been declined for the following reason/s: Hospitalization and medical investigations during 11-JUN-10 to 19-JUN-10 for Chronic Kidney Disease Stage-5, End Stage Renal Disease on Maintenance Haemodialysis. This was not disclosed to us in the proposal form dated 20-DEC-10.

Had these facts been disclosed the company would not have covered the risk for the above said policy under the same term and conditions.

Hence, the claim has been repudiated due to non-disclosure of material facts.

8.       As has been held by Hon’ble Supreme Court in catena of judgments[1] suppression of material facts relating to pre existing ailments in the proposal form entitles the Insurance Company to repudiate the claim.  However, as was held by Hon’ble Supreme Court in LIC of India Vs. G M Channabasamma (1991) 1 SCC 357, burden of proving that  insured made false representations and suppressed material facts is undoubtedly on the Insurance Company. 

9.       The State Commission in its order recognized the said right of the insurance company to repudiate the claim if there is suppression of material facts in the proposal form.  However, the State Commission has dismissed the appeal and upheld the order of the District Forum on account of the reason that no credence and credibility can be attached to Ex. B-1 ( discharge summary) in view of the testimony of RW-1 and 2 ( Dr. R Srinivas and Dr. T.P.R.Chowdary).  The State Commission has observed that testimony of RW-1 and 32 is nowhere helpful to substantiate the stand of the OPs.  Although the State Commission recognized that mere non production of proposal form itself is not a valid ground to disbelieve the version put forth by the OPs but the State Commission disbelieved the version put forth by the OPs in view of the earlier testimony of RW-1 and 2 coupled with cloud cast on Ex.B-1.  Keeping in view the material available on record, the State Commission concluded that OPs failed to establish that life assured was suffering from kidney problem and took treatment in the hospital from 11.06.2010 to 19.06.2010 i.e. much prior to the taking of the policy.  Extract of relevant paras of the order of the State Commission are reproduced below :

“14. There is no much dispute between the parties with regard to Ex.A-1 policy and date of death of the life assured. It is a settled principle of law, the burden lies on the insurance company to establish that the life assured had obtained the policy by suppressing the material facts in the proposal form. The contract of insurance is based on utmost good faith. The life assured has to disclose the material facts in the proposal form so as to enable the insurance company either to accept or reject the proposal. It is needless to say that the quantum of premium to be collected by the insurance company invariably depends on the information furnished by the life assured. To put it in a different way, the premium collected shall commensurate the risk involved in issuance of the policy. If the life assured intentionally and wilfully suppressed the material fact, certainly, the insurance company is entitled to repudiate the claim. The Insurance Company has no right whatsoever to repudiate the claim of the claimants on flimsy and untenable grounds. Let us consider the facts of the case on hand in the light of the above legal principles.

15. It is the case of the opposite parties that the life assured had taken treatment from 11-06-2010 to 19-06-2010 due to kidney problem. Ex.A-3 repudiation letter is the earliest document. There is no mention in Ex.A-3 in which hospital the life assured alleged to have been taken treatment from 11-06-2010 to 19-06-2010. Exs.B-1 and B-3 are one and the same, i.e., discharge summary. Ex.B-2 is the letter. As per the recitals of Ex.B-1, the life assured had taken treatment in Apollo hospital, Visakhapatnam from 11-06-2010 to 19. 06-2010. In order to prove the recitals of Ex.B-1, the opposite parties examined R.W.1 Dr. R. Srinivas and R.W.2 Dr. T.P.R. Chowdary.

16. We have perused the testimony of these two witnesses meticulously in order to appreciate the stand taken by the opposite parties. These two witnesses categorically deposed that Ex.B-1 discharge summary was retrieved from the computer on 01-06-2015, The testimony of R.W.1, reveals that R.W.2 signed on Ex.B-1 on 01-06- 2015 in his presence. As per the recitals of Ex.B-1, the life assured had taken treatment under the supervision of Dr. J.A.L. Ranganadh, Nephrologist. Interestingly, R.W.2 signed in Ex.B-1 for Dr. J.A.L. Ranganadh. We are unable to understand how R.W.2 is competent to  sign on Ex.B-1 on behalf of Dr. Ranganadh. The testimony of R.W.2 clearly reveals the entire record of the hospital floated in the rain water in the month of October, 2014 due to Hud Hud Toofan in Visakhapatnam. If the testimony of R.W.2 is taken into consideration, the entire record in all floors of the hospital was damaged. Computer is a very sensitive and delicate one. When all the records were completely destroyed, how the computer from which Ex.B-1 retrieved was not got affected. The testimony of these two witnesses reveals that the discharge summary is a part and parcel of the case sheet. When the entire case sheet was damaged, how they secured the discharge summary was not properly explained by the opposite parties. The retrievation of the record from the computer pre-supposes uploading of the information. If the testimony of R.W.2 is taken into consideration, the discharge summary alone cannot be uploaded without the case sheet. If they uploaded the case sheet including the discharge summary what prevented the hospital authorities to produce the case sheet. Non-production of the case sheet creates any amount of doubt with regard to the stand taken by the opposite parties.

17. If the testimony of R.W.2 establishes the factum of uploading of the information in the computer, then this Commission can place reliance on Ex.B-1. In order to test the veracity of the testimony of R.W.2, it is not out of place to extract the relevant portion of the cross examination which reads as follows:

....... That record was not maintained in computer earlier to Hudud Tuffan. After Hudud Tuffan we maintained a register with regard to the No. of case sheets damages or lost and remaining balance of the case sheets. That register was not filed into the court........'

If the testimony of R.W.2 is taken into consideration, the Apollo Hospital, Visakhapatnam had not computerized the records prior to Hudud Tuffan. In such circumstances, the question of retrievation of Ex.B-1 from the computer is highly improbable and unbelievable. There are number of contradictions in the testimony of R.W.1 and R.W.2. As admitted by R.W.1 and R.W.2, Ex.B-1 does not bear the signature of competent person on each and every page. R.W.2 in unequivocal terms deposed that if the record is computerized, the document generated will bear the signature of the concerned doctor. Admittedly, Ex.B-1 does not bear the signature of Dr. Ranganadh.

18. It is needless to say that this Commission shall not discard testimony of the witnesses on flimsy and untenable grounds. The Commission can place reliance on the testimony of the witnesses if the same inspire the confidence. The manner in which R.W.1 and R.W.2 deposed, creates any amount of doubt in the mind of this Commission. The possibility of creating Ex.B-1 to suit the claim of the opposite parties, thereby to deprive the legitimate claim of the complainant cannot be ruled out completely. As per the testimony of R.W.2, they retrieved the discharge summary basing on the Aarogyasree Number assigned to the life assured. The Aarogyasree Number of the life assured is not mentioned in Ex.B-1. In the absence of Aarogyasree Number of the life assured, how they generated Ex.B-1 is somewhat doubtful. The testimony of R.Ws.1 and 2 is no way helpful to substantiate the stand of the opposite parties. In view of the testimony of R.Ws.1 and 2, no credence and credibility can be attached to Ex.B-1. Surprisingly, the opposite parties did not choose to produce the proposal form of the life assured to establish that the life assured had given negative answers to the question numbers 19 to 22 in the proposal form. We are very much conscious that mere non-production of proposal form itself is not a valid ground to disbelieve the version put forth by the opposite parties. In the instant case, we are disbelieving the version put forth by the opposite parties in view of the oral testimony of R.Ws. 1 and 2, coupled with cloud cast on Ex.B-1. Basing on the material available on record, the irresistible conclusion that can be drawn is that the opposite parties failed to establish that the life assured was suffering from kidney problem and taken treatment in the hospital from 11-06-2010 to 19-06-2010, i.e., much prior to taking of Ex.A-1 policy. In the absence of material much less cogent and convincing material, the opposite parties are not justified in repudiating the claim. In the instant case, the opposite parties repudiated the claim of the complainant without any cause much less justifiable cause.

19. The District Forum considered the material available on record in right perspective and arrived at a conclusion that there was deficiency in service on the part of the opposite parties 1 and 2 in repudiating the claim. We are fully endorsing with the findings recorded by the District Forum. There is no illegality or irregularity in the impugned order which warrants interference of this Commission. Viewed from any angle, the appeal is liable to be dismissed.”

10.     It has been held by Hon’ble Supreme Court in catena of judgments[2] that revisional jurisdiction of the National Commission is extremely limited, it should be exercised only in case as contemplated within the parameters specified in the provision i.e. when State Commission had exercised a jurisdiction not vested in it by law or had failed to exercise jurisdiction so vested or had acted in the exercise of its jurisdiction illegally or with material irregularity.  It is only when such findings are found to be against any provisions of law or against the pleadings or evidence or are found to be wholly perverse, a case for interference may call for at the second appellate (revisional) jurisdiction. In exercising of revisional jurisdiction, the National Commission has no jurisdiction to interfere with concurrent findings recorded by the District Forum and the State Commission, which are on appreciation of evidence on record.  We are in agreement with the observations and findings of the State Commission.  In view of the foregoing, we find no illegality or material irregularity or jurisdictional error in the order of the State Commission, hence the  order of the State Commission is upheld.  Accordingly, Revision Petition is dismissed.

11.     The pending IAs in the case, if any, also stand disposed off.