Heard learned counsel for both sides.
2. Here is an appeal filed u/s 15 of the erstwhile Consumer Protection Act, 1986 (hereinafter called the ‘Act’). Parties to this appeal shall be referred to with reference to their respective status before the District Forum.
3. The factual matrix leading to the case of the complainant is that the complainant is the wife of deceased Prafulla Ch.Sahu who had purchased the LIC Policy bearing No. 571150380 15.5.2002 for assured sum of Rs.25,000/-. While the policy was in force, it is alleged inter alia that the insured died on 30.5.2002. The complainant allegedly submitted all the documents with death claim but the OP repudiated the claim on the ground that the deceased has withheld the pre-existing disease and deliberately had given mis-statement. So the repudiation of the claim of the complainant in question is completely unlawful, illegal and has given mental agony to the complainant who is the nominee of the deceased life assured. Since there is deficiency of service on the part of the OP, the complainant filed the complaint praying to direct the OP to pay the assured value with compensation and litigation expenses. Hence, the complaint.
4. Per contra, the OP filed written version stating that the husband of the complainant was issued the policy but he has suppressed the material fact of pre-existing disease because in the bed-head ticket, it has already recorded that the complainant’s husband was taking alcohol since last 15 years but in the proposal form he has not disclosed such fact. Since material fact has been suppressed, they have repudiated the claim. So, there is no deficiency of service on the part of the OPs in repudiating the claim of the complainant.
5. Learned District Forum after hearing both parties has passed the following order. The relevant portion is as follows:-
“ xxx xxx xxx
In the result, we direct the opposite party to pay sum assured amount of Rs.25,000/- only to the complainant within one month of receipt of this order, failing which the same amount will carry 12% penal interest in the best interest of consumer justice. No cost.”
6. Learned counsel for the appellant submitted that since there is recording of the submission of the complainant’s husband during life time to show that he has taking alcohol for 15 years. The policy form showing no such habit is illegal and improper and amounts to suppression of material fact but the learned District Forum ought to have considered the material fact. Learned counsel for the appellant relied on the decision of Honble National Consumer Commission in the case of LIC of India vrs. Smt. Meena Mahalawat in First Apepal No. 01 of 2004. So, he submitted to allow the appeal by setting aside the impugned order.
7. Considering the submission of learned counsel for the appellant and perused the DFR including the impugned order.
8. No doubt the complainant has to prove the deficiency in service on the part of the OP. It is in dispute whether the insured has suppressed the pre-existing disease and making false statement. In the decision of Mithoolal Nayak vrs. Life Insurance Corporation of India AIR 1962 Supreme Court 814, it has been held by the Hon’ble Apex Court which is as follows:-
“ xxx xxx xxx
The three conditions for the application of the second part of Section 45 are
a) the statement must be on a material matter or must suppress facts which it was material to disclose,
b) the suppression must be fraudulently made by the policy holder and
c) the policy holder must have known at the time of making the statement that it was false or that it suppressed facts which it was material to disclose.”
9. With due regard to the decision, it can be safely observed that within two years of making effect of policy the insurer have right to revoke the policy as per unamended Section 45 of Insurance Act, 1938, if the explanation to the section 45(2) are fulfilled and onus lies on the insurer to prove all the ingredients before calling the policy in question within two years. It is also settled in law that necessary medical documents should be proved by the OP to show that deceased has suppressed the material fact at the time of filling up of the proposal form. In the instant case, the onus lies on the OP to prove the pre-existing disease. We have gone through the proposal form where it has been said at Column 11(h) which is as follows:-
“xxx xxx xxx
h) Do you use or have you ever used No.
i) Alcoholic Drinks ii) Narcotics
iii) Any other drugs iv) Tobacco in any form? ”
10. Learned counsel for the appellant also drew our attention to the bad-head ticket where the history of the patient has been recorded. This statement is based on opinion of any person but not specifically mentioned. The OP has not filed any medical document to prove such alcoholic of the complainant’s husband to justify such recording towards history of the deceased policy holder. At the same time, we have come across the statement of attendant and it is clearly stated that there is no any other document to show the previous disease. Thus, we are of the view that the OP has failed to prove the cogent evidence that the husband of the complainant was suppressed the material fact to the question asked. In such circumstances, though cryptic order has been passed but we agree with the finding of the learned District Forum.
11. We have gone through the decision of LIC of India (Supra) and find that the facts and circumstances of that case is different from the facts and circumstances of this case. Therefore, the decision cited by the learned counsel for the appellant is not applicable to this case.
12. Therefore, the appeal stands dismissed. No cost.
DFR be sent back forthwith.
Supply free copy of this order to the respective parties or the copy of this order be downloaded from Confonet or Website of this Commission to treat same as copy supplied from this Commission.
