LIC OF INDIA vs KANCHANBALA BADU

APPELLANT was the opposite party before the State Commission, where the respondent/complainant had filed a complaint alleging deficiency in service on the part of the appellant.

UNDISPUTED facts of the case are that the complainant''s deceased husband had obtained two insurance policies from the appellant. Upon death of the insured when the claim was preferred, the complainant paid the amount in respect of first policy but repudiated the claim in respect of second policy, on the ground that Policy holder has suppressed the material fact while submitting the proposal form, for the second policy. It is in these circumstances that a complaint was filed before the State Commission, who after hearing the parties allowed the complaint and directed the appellant to pay the policy amount relating to the second policy. Aggrieved by this order this appeal has been filed before us. We heard the learned Counsel for the parties and perused the material on record. Two points have been raised before us by the appellant-firstly, that at the time of taking the second policy, in the proposal form, the deceased had not mentioned of having been a holder of earlier policy and secondly, the cause of death of the deceased is Leukemia, which the insured had suppressed.

As far as the first point is concerned, the State Commission after perusing the proposal form upheld the submission of the appellant that the factum of the deceased having obtained a policy earlier from the LIC was not mentioned in the proposal form for taking second policy. It is the case of the appellant that had this been shown then the LIC would have made certain other further investigation before acceptance of second policy.

THERE is no dispute that the petitioner died of Leukemia. The second policy was taken in November 1993 and he died of Leukemia on 4.5.1995. It is common knowledge that Leukemia is not one of the ailments which occur overnight. The report of the Prof. of Medicine of SCB Medical College, Cuttack dated 16.1.1996 confirm that the deceased was suffering from chronic Leukemia since 4.3.1995. Past history has not been given and especially in view of the fact that it was not ''localised'' presumption will be that he was having cancer for some time. It is on record that the complainant did not cooperate in giving any information on the treatment taken by the deceased. In view of the above we are constrained to observe that this appears to be prima facie proven case of suppression of ailment - Leukemia in this case. It is also admitted position that payment in respect of second policy has already been made to the complainant. In these circumstances, relying upon the judgment of the Hon''ble Supreme Court in the case of Life Insurance Corporation v. Mani Ram, III (2005) CPJ 31 (SC)=VI (2005) SLT 210, in Civil Appeal No. 4806/2005 passed on 5.8.2005, we hold the orders of the State Commission not in accordance with law, which is set aside but direct that no recovery will be effected from the respondent/complainant pursuant to this order, since payment has already been made to the widow of the deceased.

THIS appeal stands disposed of in above terms. Appeal disposed of.