Sri Shyamal Gupta, Member
Factual matrix of the complaint case, in brief, are that Complainant’s wife, Sahana Bibi, during her lifetime took an insurance policy bearing no. 1B004862910 from the OPs for a sum insured of Rs. 24,50,000/- on 30-05-2013. As ill luck would have it, Complainant’s wife died at home on 20-09-2013. The claim lodged by the Complainant in this regard was repudiated by the OPs on 10-07-2014; hence, this complaint.
On notice, this OPs appeared before this Commission and defended their case by filing WV wherein they stated that the instant complaint is barred by limitation. It is also submitted that the instant complaint case is not maintainable because it is hit by the principle of Res Judicata. It is submitted that income is a material fact which determines whether the proposer is prima facie eligible for the amount of sum assured applied for the insurance cover. If the income of the proposer is such that he/she is not entitled to the proposed sum assured and still the proposer overstates his/her income and obtain the insurance cover fraudulently, any subsequent revelation of the statement of income would render the insurance cover void ab initio. It is alleged that the policyholder, since deceased, took the subject policy by submitting a fake income proof document. It is stated that the Complainant’s wife, since deceased, initially took an insurance policy of Rs. 4,50,000/- by submitting proposal form dated 06-05-2013. Thereafter, he filed proposal for the subject policy on 24-06-2013. Acting on good faith, based on the information furnished in the proposal form, the OPs issued the said policies. In both the proposal forms, under Point No. 6, the DLA had mentioned occupation and exact nature of duties as owner of Sahana Human Hair Process, Dhusia. However, according to the letter received from the Complainant, i.e., DLA’s husband, DLA was a housewife and Complainant’s friend Saber Ahammad used the DLA for taking insurance policies. The DLA had submitted joint bank account statement of SB account as income proof with the proposal form, and as per the said bank statement submitted by the deceased, the bank account was held by Sk. Saber Ahammad and Sahana Bibi jointly. However, during inquiry from bank, it was found that the said bank account was not jointly held by the DLA; it was an individual bank account stands in the name of Saber Ahammad. Thus, it was evident that the bank statement was tampered with to avail the insurance policy. Inquiry conducted in the matter also revealed several other anomalies which go to show that everything was done in a planner manner. Taking due note of all these, the instant claim was repudiated by the OPs.
Points for consideration
- Whether the complaint case is maintainable in its present form and prayer?
- Whether there is any deficiency in service on the part of the OPs?
- Whether the Complainant is entitled to any relief?
Decision with reasons
Point No. 1:
It appears that the instant claim was firstly repudiated by the OPs on 10-07-2014. Thereafter, on the prayer of the Complainant, the OPs reconsidered the matter and subsequently on 06-10-2014, they upheld their earlier decision. It appears that against the said decision, the Complainant lodged complaint before the Banking Ombudsman which by its order dated 18-01-2016 dismissed the complaint and ultimately, the present complaint was lodged on 10-07-2017. The delay, so caused, appears to be bona fide and accordingly, we are not inclined to dismiss this complaint on this technical ground.
Ld. Advocate for the OPs though contended that the present complaint case is hit by the principle of Res Judicata, it seems that the term ‘res judicata’ means ‘thing already decided by a competent court. Section 11 of the Civil Procedure Code, 1908 embodies the doctrine of res judicata in India. It states that no court shall try any suit or issue in which the issue directly and substantially, in a former suit, between the same parties or their representatives, in a competent court, has been heard and finally decided by such court. This principle rests on two principles i.e. (i) one should not be vexed twice for same cause; and (ii) there should be finality to litigation. Where there has been an executable judgement between the parties, the rule of res judicata will prevent a fresh suit between them for the same relief.
There are five conditions which must be satisfied for the application of res judicata:
- The matter directly and substantially in issue in the subsequent suit must be the same matter which was directly and substantially in issue, either actually or constructively in the former suit.
- The former suit must have been a suit between the same parties or between the parties under whom they claim.
- In the former suit, the parties must have litigated under the same title.
- The court which decided the former suit must have been a court which is competent to try this subsequent suit.
- The matter which is directly and substantially in issue in the subsequent suit must have been heard and finally decided by the court in the former suit.
The complaint lodged before the Banking Ombudsman or this Commission cannot be treated as a suit. Further, neither the Banking Ombudsman nor this Commission can be treated as ‘Court’. Therefore, in our considered opinion, the principle of Res Judicata is not applicable here.
Accordingly, we find no substance in the objection raised from the side of the OPs on the maintainability ground.
Point Nos. 2&3:
Both these inter-connected points are taken up together for the sake of brevity of discussion.
It is alleged by the OPs that the subject account bearing no. 30724360774 opened at their Kalyanpur branch stands in the single name of Sk. Saber Ahammad and in order to establish such fact, they filed copies of bank statement of the said account for the period from 01-04-2012 to 30-09-2012.
On going through the documents on record, we come across another set of bank statement in respect of the afore mentioned bank account for the period from 01-03-2013 to 01-06-2013. According to this statement, the said account stood in the joint name of Sk. Saber Ahammad and Sahana Bibi.
It is significant to note that though the OPs hurled allegation of manipulation of bank statement for the purpose of obtaining the subject insurance policy, they have not filed bank statement for the period from 01-03-2013 to 01-06-2013, but for a different period, i.e., in between the period from 01-04-2012 to 30-09-2012. It may well be that the operating mode of the subject bank account was changed from ‘single’ to ‘joint’ after 30-09-2012 and such changes could only be done following due process of law and submission of necessary KYC form together with relevant documents. In absence of any counter Statement of Account from the side of the OPs for the period from 01-03-2013 to 01-06-2013 to prove the Statement of Account for the period being submitted by the DLA along with the proposal form, we cannot cast any suspicion on the sincerity of purpose of the Complainant’s wife, since deceased. The concerned Investigator did not depose this Commission to prove that the DLA was not the Proprietor of Sahana Human Hair Process. Rather, copies of Trading, Profit & Loss Account, Balance Sheet of the said Proprietorship concern on record strengthens the claim of the Complainant.
The OPs, in support of their contention, furnished another document, viz., photocopy of the purported letter dated 08-04-2014 being issued by the Complainant. However, it is alleged by the Complainant that the said letter was taken by the OPs by misleading him. From the tone and tenor of the subject letter, it does not seem to us that any person of normal prudence could issue such suicidal letter to the Insurance Company, unless of course he was misled by the Insurance Company.
No doubt, death of a policyholder within approx. 4 months of taking an insurance policy is bound to raise eyebrows. However, on the basis of mere suspicion, the sincerity of purpose of a deceased person cannot be called in question. It appears from the death certificate issued by Dr. G.K.Nanda, M.D. that the DLA was suffering from enteric fever with pneumonia and she died of cardio respiratory failure. There is nothing to show that the DLA was suffering from any chronic disease. Thus, it is hardly believable that the subject insurance policy was taken with any mala fide intention by suppressing previous medical condition.
Above all, in terms of Sec. 19 of the Indian Contract Act, 1872, even if consent to an agreement is caused by coercion, fraud or misrepresentation, the contract is not voidable, if the party whose consent was so caused had the means of discovering the truth with ordinary diligence. The income proof documents provided by the DLA could easily be verified by the OPs if they had due wherewithal in this regard. If they did not do so, the buck stops at their doorstep.
Issuance of a policy signifies the fact that the issuer of the policy has done so after satisfying himself about the veracity of the information furnished along with the proposal form. After merrily accepting insurance premium from the proposer without asking any question, the Insurance Company cannot renege on its commitment. That apart, belying about one’s income cannot be considered as material suppression. Since no one can foresee the timing of one’s death, it is hardly believable that for the sake of making a life insurance policy, one would resort to falsehood.
Thus, none of the allegations of the OPs being proved beyond all reasonable doubt, we find no justification behind repudiation of the subject claim and hold the OPs guilty of gross deficiency in service on this score.
Therefore, we hold that the Complainant deserves due insurance benefit.
We would like to conclude by appending below some relevant observations of the Hon’ble National Commission which are self-explanatory.
The Hon’ble Commission in IFFCO Tokio General Insurance Co. Ltd. v. Varsha Associates, 2018 (1) CPR 568 (NC) has been pleased to hold that rejection of the claims on purely technical grounds in a mechanical manner will result in loss of confidence of policyholders in the insurance industry.
In National Insurance Co. Ltd. v. Mata Naina Devi Ji Fuel Centre, 2018 (2) CPR 378 (NC), the Hon’ble Commission observed that unless insurance company is able to show that insurance claim falls within some exclusion or exception provided in terms and conditions, insurance company cannot evade its liability under insurance claim.
The complaint case, accordingly, succeeds.
Hence,
O R D E R E D
The case stands allowed on contest against the OPs with a cost of Rs. 25,000/- being payable by the OPs to the Complainant. The OPs are directed to settle the instant claim by paying Rs. 24,50,000/- to the Complainant within 40 days from today together along with simple interest @ 9% over the aforesaid sum of Rs. 24,50,000/- w.e.f. 10-07-2017 till full and final payment is made.
