BRANCH MANAGER, LIFE INSURANCE CORPORATION OF INDIA vs GEETA RANI NANDY

THIS appeal is directed against order dated 31.1.1998 allowing the case in part and directing the opposite party, namely, Life Insurance Corporation of India to pay Rs. 15,000/- covered under L.I.C. Policy. The claim for compensation was however, disallowed. Being aggrieved thereby the LIC has preferred this appeal.

THE brief fact of the case is that the deceased Sri Sisir Nandy took out an LIC Policy for Rs. 15,000/- on 28.8.1993. He paid last premium on 28.8.1994 and died on 29.10.1994 at S.S.K.M. Hospital, Calcutta due to Myo-Cardial infraction. His widow Smt. Geeta Rani Nandy lodged claim with the LIC by an application dated 25.11.1994. THE Insurance Company repudiated the claim on the ground that there was suppression of material facts at the time of filling up the proposal form by withholding the material information regarding the state of health of the assured. THE Insurance Company having refused to settle the claim, the complainant has approached the Forum. The case was contested by the L.I.C. by filing a written version wherein they claim that the assured had suffered from diabetes mellitus and had consulted a Physician and was treated by him. Their further case was that the deceased was suffering from heart ailment for the last 5 years and these facts were suppressed in the proposal form. According to the opposite party the duration of policy was only 1 year and 2 months and as such the mischief of Section 45 of the Insurance Act is attracted. The deceased was on leave from 1.7.1992 to 10.7.1992 i.e. prior to the taking up of the policy on 28.9.1993 on medical ground. The Insurance Company made thorough investigation into the matter and thereafter rejected the claim on valid ground.

It is not disputed that the husband of the complainant took out one policy for Rs. 15,000/- on 28.8.1993 and he died on 29.10.1994. It is, therefore, clear that the death occurred within one year and two months from the date of issue of policy. Since the death occurred within two years of taking out the policy, the Insurance Company made thorough investigation into the matter and came to learn that the deceased had past history of diabetes millitus for two years and he was also suffering from Cardiac disease for the last 5 years. The Medical Attendance Certificate and the Certificate of Hospital Treatment (Annexures-E and F) prove the case made out by the Insurance Company. The assured was the patient of hypertension and diabetes long before the policy was taken out. According to the opposite party the contract of insurance falls within the category of ''Uberrimae Fidei'' contract i.e. it is a contract made on utmost good faith. The learned Lawyer for the appellant submits that the assured was aware of the ailments from which he was suffering and the Insurance Company was kept in dark about the ailments. The assured suppressed the material facts and as such the complainant being the widow is not entitled to get any amount. It is further contention of the learned Counsel for the appellant that since the repudiation of the claim was done after due enquiries and in good faith, it cannot be said that the Insurance Company was guilty of deficiency in service. In this connection, he refers to a case reported in 1997 (1) CPR 40. Therefore, relying on the decision of the National Commission and on the fact that there had been deliberate suppression of material facts, we are of opinion that the claimant could not get any relief in this case. The Forum was, therefore, not justified in allowing the claim. It ought to have rejected the case. In that view of the matter we allow the appeal and set aside the judgment of the Forum and dismiss the complaint. Appeal allowed.