VINAY KUMAR SWARNKAR vs L.I.C. OF INDIA & ORS.

This Revision Petition has been filed by the Petitioner against the order dated 11.02.2009 of the Bihar, State Consumer Disputes Redressal Commission, (in short the ''State Commission'') in First Appeal no.234 of 2007.

The facts of the case are as under:

Petitioner''s father Shri Mahavir Prasad took four polices from Madhubani Office, of Life Insurance Corporation (hereinafter referred as ''LIC'') with following details :-

Policy No. Date of Commencement Sum Assured Policy Bond Issued

532097315 20.05.1998 Rs.50,000.00 02.08.1998

532099180 28.07.1998 Rs.50,000.00 04.08.1998

532154447 26.03.1999 Rs.50,000.00 26.06.1999

532284429 28.05.1999 Rs.50,000.00 12.08.1999

The Petitioner was nominee in all the four polices. The life assured Shri Mahavir Prasad Swarnkar died on 15.09.1999 of cardiac and respiratory trouble. After pursuing with the Life Insurance Corporation, the claims were rejected. The Petitioner filed a complaint before the District Consumer Grievances Redressal Forum, Madhubani (in short the ''District Forum'') which vide its order dated 17.01.2006 allowed the payment of insured sum to the Complainant for all the four polices along with interest @ 7% p.a. from the date of filing of complaint till the date of actual payment. Aggrieved by this order of District Forum, the Opposite Party i.e. LIC preferred an Appeal before the State Commission. State Commission vide its order dated 11.02.2009 allowed the appeal and rejected the claims of the Complainant and awarded only a cost of Rs.30,000/- to the Complainant for his mental agony and delay in deciding the claims.

We have heard the learned counsel for both the parties and perused the records. Learned counsel for the Petitioner has argued that the claims have been repudiated by the LIC vide their four letters dated 3.4.2002, 23.03.2002, 23.03.2002 & 02.04.2002. In two letters, the claims have been rejected on the ground of age only and it has been alleged that the age of the insured was about 10-15 years more as compared to the age mentioned in the proposal form. In the two other letters, the claims have been rejected on two grounds i.e. first of age and secondly on the ground that an earlier policy in the name of the insured Mr. Mahavir Prasad Swarnkar taken from another District of Darbhanga, was not mentioned in the proposal forms filled for Madhubani polices. Learned counsel for the Petitioner stressed that the age of the insured was correctly recorded in the proposal forms as the same is mentioned in the School Certificate as well as in the voter list which were submitted to the Respondents. With respect to another policy from District Darbhanga, It has been submitted that the same was inadvertently not mentioned in the proposal form as the proposal forms are generally filled by the agents of the L.I.C. The insured was medically examined by the doctor authorised by the Insurance Company. Moreover, ECG was also done and after proper satisfaction, the polices were issued. The claim against Darbhanga policy was also cleared by the LIC. Only due to technical reasons, the claims against LIC policies cannot be rejected and the facts and circumstances of the case must be looked into. Learned State

Commission has erred in summarily rejecting the claims on the basis of some written statements submitted by the Respondents after hearing of the case, for which Petitioner could not get any opportunity to rebut.

Learned counsel for the Respondents stated that an elder son Shri Rameshwar Prasad Swarnkar son of insured Mahavir Prasad Swarnkar had taken a life insurance policy in the year 1990 where he has given information about his family wherein his father''s age has been mentioned as 60 years. Therefore, his father Mahavir Prasad Swarnkar cannot be of 53 years in the year 1998. Therefore, it is a clear case of supressing the age for illegal benefits. Taking four polices in short span of about a year also indicates mala-fide intention of the Petitioner. It was argued that the insured Mr. Mahavir Prasad Swarnkar did not mention his Darbhanga policy in the four proposal forms of Madhubani polices due to the fear that the total sum assured would increase and demand special medical examination. Therefore, he purposely suppressed this information and got all the four polices issued from Madhubani office. Both these grounds are sufficient to reject the claims of the Petitioner and the claims have been rightly rejected by the State Commission.

It is clear from the records that there are only two objections for rejecting the claims of the Petitioner. The first is regarding the age of the insured Mr. Mahavir Prasad Swarnkar and the second is regarding non-disclosure of Darbhanga policy in the proposal forms of Madhubani policies. His age has been recorded as 53 years in the year 1998 and the same date of birth has been recorded in all the four polices of Madhubani office and also in the policy of Darbhanga office. The Petitioner has based his claim of age on School Certificate and on Voter List. Voter List is a very valid document so far as the age of the person is concerned. Respondents are basing their claim on only one proposal form, which was filled by the son Mr. Baijnath Prasad (in the pleadings Mr. Rameshwar Prasad had been mentioned, whereas the policy of Baijnath Prasad has been kept on record). In this proposal form the information about the father of the proposer has been shown to be a 60 years. This proposal form was not signed by Mr. Mahavir Prasad Swarnkar. Respondents have not placed anything on record disputing the School Certificate or the Voter List and any other positive proof from some government agency or self -declaration/statement from Mr. Mahavir Prasad Swarnkar the insured. Moreover, the claim against Darbhanga policy has also been accepted by the Respondents and paid to the Petitioner. Thus, Respondents have also accepted the same age of the insured in one policy. Based on this discussion, we are inclined to hold that the rejection of claims on the basis of age of the insured is not justified.

With respect to the second question of withholding information about the Darbhanga policy in the four proposal forms, we have to see the effect of inclusion of this information in the proposal forms. Though, as per the policy rules, all the previous policies should have been indicated in the proposal form, but according to the Petitioner, inadvertently, this information was missed out. There seems to be some force in the assertion of the Petitioner that the proposal forms are practically filled by the agents and there may be some mistake if the agent does not ask proper questions from the proposer. But we feel this does not absolve proposer completely from not submitting the correct information. Therefore, it is necessary to see the effect of inclusion of Darbhanga policy in the four polices in question. As explained by the learned counsel of the Respondents, had the Darbhanga policy been included in the proposal forms, the total sum assured would have crossed Rs.2 lakhs and therefore, this would have demanded special medical investigation. Practically this stage, would only come for the 4 policy taken on 28.05.1999. th For the first three polices this would not have made any difference in medical examination even if

the Darbhanga policy was included. Hence, we are of the view that the omission of the Petitioner of not including the Darbhanga policy would make him liable to lose only that policy where inclusion of Darbhanga policy would have subsequently changed the level and procedure of medical examination. For those policies where the inclusion of Darbhanga policy would not have made any material impact on level and procedure of medical examination, only this technical lacuna should not put the Petitioner to lose all the claims because the policies were issued by the insurer by observing all the formalities and the death of the insured is not disputed.

Based on forgoing discussions, we conclude that the Respondents are liable to pay the sum assured along with interest as directed by the District Forum in respect of the three polices i.e. 532097315 dated 20.5.1998, 532099180 dated 28.7.1998 and 532154447 dated 26.3.1999.

Thus, the order of the State Commission is set aside and the Revision Petition is partly allowed and the Respondents are directed to pay to the Petitioner claims in respect of three polices i.e. 532097315 dated 20.5.1998, 532099180 dated 28.7.1998 and 532154447 dated 26.3.1999 along with the interest as directed by the District Forum in their order dated 17-01- 2006 . The Respondents are not liable to pay the claim against the 4 policy. The Respondents are directed th to comply with this order within two months otherwise enhanced interest @ 12% p.a. will become payable after two months.