NEEL KAMAL vs METLIFE INDIA INSURANCE CO. LTD.

Late Shri Ombir Singh, husband of the complainant / appellant obtained an insurance policy to the extent of Rs.75,00,000/- from the respondent insurance company, on 11.10.2007. He having been murdered on 06.10.2008, a claim was lodged by the complainant / appellant for payment of the benefit payable, in terms of the said policy. The claim however, was repudiated vide letter dated 16.3.2009 which to the extent it is relevant reads as under;

"The policy was issued on 11.10.2007 on the basis of application dated 25.9.2007 submitted by the insured.

Investigation was arranged due to the proximity of death from the date of insurance which has confirmed after exhaustive enquiries and verification that:

a. The deceased was being prosecuted for offence of cheating under Section 420, 467, 468 of I.P.C. in C.C. No. 10389/2005 in Crime No. 314/05 before Chief Judicial Magistrate, Noida which was not disclosed in the Proposal. As far Investigation Report Police had seized 1000 MT of steel rods which are in police custody. However the said proceeding was not disclosed in the Application despite specific question in this regard vide Question No. 5.1(4).

b. For the purpose of substantiating income stated in the Application, the deceased had submitted two sets of audited accounts for the years ending 31.3.2006 and 31.3.2007 purported to have been signed by Chartered Accountant Mr. Navin Chander Goel. However, during investigation, the Chartered Accountant has denied certifying the accounts for the year ending 31.3.2007. Hence the accounts upto 31.3.2007 does not bear genuine signature / seal of the Chartered Accountant.

There has been suppression and misrepresentation in the application for insurance on crucial and material facts, on the basis of which the policy was obtained.The policy vitiated by such suppression and misrepresentation".

Being aggrieved from the rejection of the claim, the complainant approached the concerned State Commission by way of a consumer complaint. The complaint was resisted by the respondent insurer, primarily on the grounds on which the claim has been repudiated.

Vide impugned order dated 12.8.2011; the State Commission dismissed the complaint on the ground that the insurance policy had been obtained by suppression of material facts. Being aggrieved the complainant / appellant is before this Commission by way of this appeal.

While submitting the application for life insurance, the deceased insured was required to answer some material questions. Question No.4 required him to disclose whether he had been convicted or involved in criminal case or had any case pending against him. The answer to the aforesaid question was given in negative, meaning thereby that the insured represented to the insurer that no criminal case was pending against him and he had not been involved in any such case. It is an admitted position that a criminal case was pending against the insured at that time, though, according to the learned counsel for the appellant / complainant, the said criminal case had been registered under the provisions of the Trade Marks Act. In my view, it would be immaterial whether the criminal case was registered under the provisions of Indian Penal Code or under any other Statute, entailing a criminal liability. Since the insured at the time of submitting the application was involved in a criminal case, though under Trade Marks Act and the said case was pending against him, he ought to have answered in affirmative to the above referred question.

The learned counsel for the appellant / complainant states that the application form was not filled up directly by the insured though admittedly it was signed by him. It is not disputed by the learned counsel that the deceased insured was an educated person he being a Graduate and a Director in a company. Therefore, if the person filling up the application form had ticked a wrong answer to the above referred question, he ought to have got the answer corrected before signing and submitting the application form. That having not been done, it is obvious that he was a party to the false information provided to the insurer.

In the application form, the insured had declared his annual income at Rs.15,10,000/-. The form was filled up on 25.09.2007. Therefore, his income in the financial year 2006-07 would be relevant for the purpose of the aforesaid information. The learned counsel for the appellant states that the complainant / appellant is unable to produce any documents so that the income of the husband of the complainant / appellant in the financial year 2006-07 was Rs.15,10,000/-. According to him, the income of the insured in the financial year 2005-06 was to the extent of more than Rs.15,00,000/-. However, it is the income in the financial year 2006-07 and not the income in the year 2005-06 which would be relevant for the purpose of disclosing the said information. The insured therefore, made a false representation to the insurer even with respect to his income at the time the application form was submitted.

For the reasons stated hereinabove, the insurer, in my view, was justified in repudiation the claim on the grounds stated in the repudiation letter. The order passed by the State Commission therefore, does not call for any interference by this Commission in exercise of its appellate jurisdiction. The Appeal is therefore dismissed, with no order as to costs.