( 1 ) THIS appeal is directed against the judgment and decree in A. S. No. 23 of 1996 on the file of the District Judge, Nalgonda preferred against the judgment and decree in O. S. No. 46 of 1994 on the file of the subordinate Judge, Miryalguda.

( 2 ) THE appellants herein are the defendants and the respondent is the plaintiff in the suit. The plaintiff filed the suit for recovery of a sum of Rs. 60,000/- payable under an Endowment Assurance Policy given by the Life Insurance Corporation in the name of her late husband.

( 3 ) ACCORDING to the plaintiff, her husband late A. Narsi Reddy obtained an endowment Assurance Policy for a sum of rs. 50,000/- on 20-3-1990 and the policy was issued by the defendant-Corporation on 31-5-1990. While so, the plaintiff s husband died on 9-11-1993 due to ill-health leaving behind the plaintiff and two sons. By the date of the death of her husband the policy was in force. Therefore the plaintiff made a claim before the defendant-Corporation, but the defendants repudiated the claim on 25-2-1994 on the ground of misstatement. When the plaintiff caused a legal notice issued to the defendants, they gave a reply with the same stand. Hence the plaintiff filed the suit for a sum of Rs. 60,000/- towards the sum assured and dividend from the defendants with interest at 18% per annum from the date of death of her husband.

( 4 ) THE defendant-Corporation filed a written statement contending that the assurance policy issued by the defendant- corporation stood lapsed in March 1991 on account of non-payment of quarterly premium and the policy was revived on 20-9-1993 on the strength of a personal statement regarding his state of health, treatment etc. , made by the insured after payment of arrears of premium with interest. Since the assured died on 29-10-1993 within a short span of time from the date of revival of the policy, the corporation caused an inquiry into the health of the assured in order to guard the corporation from fraudulent claims and to safeguard the interest of the policyholders, as their trustee. The enquiries made by the corporation revealed that the policyholder suffered from chronic "myeloid lueukaemia" due to which he had undergone treatment in Medwin Hospital in different spells from 17-10-1992 to 23-10-1993. On the basis of information gathered by the Corporation it was found that the assured suppressed the material information at the time of revival of the policy. The revival of the policy was declared void and the Corporation appropriated all monies paid towards revival of the policy. Since the policy became void, the plaintiff is not entitled to the suit claim. Since the personal statement of health given by the life assured became the basis for the contract and as the life insured suppressed material information about his health and other particulars to the defendant-Corporation by giving wrong answers to the relevant questions, the revival became void. The suit is therefore liable to be dismissed with costs.

( 5 ) THE trial court framed appropriate issues on the basis of the above pleadings.

( 6 ) THE plaintiff in order to prove her claim examined P. Ws. l and 2 and marked exs. A-1 to A-8. The defendants examined d. W. 1 and marked Exs. B-1 to B-8.

( 7 ) THE trial court after considering the oral and documentary evidence adduced by both parties decreed the suit for rs. 60,000/- with subsequent interest at the rate of 12% per annum through its judgment dated 16-12-1995.

( 8 ) THE defendants being aggrieved by the judgment and decree of the trial court preferred A. S. No. 23 of 1996 on the file of the principal District Judge, Nalgonda challenging its validity and legality.

( 9 ) THE 1st appellate court after considering the evidence available on record, the relevant provisions of the Act and the legal position on the subject concurred with the findings given by the trial court and accordingly dismissed the appeal with costs through its judgment dated 10-8-1998.

( 10 ) THE defendant

Click Here to Read the rest of this document