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2017 Supreme(Bom) 2414
IN THE HIGH COURT OF JUDICATURE AT BOMBAY BENCH AT GOA
C.V. BHADANG, J.
Yvonne Miranda - Petitioner
Versus
Life Insurance Corporation - Respondent
Writ Petition No. 18 of 2011
Decided On : 04-09-2017
Advocate Appeared:
For the Petitioner: Shri Jagannath Jayant Mulgaonkar
The insurer is entitled to call into question the policy based on inaccurate or false statements within two years of its renewal, and the burden of proving the suppression of material facts lies on the insurer.
Headnote:
Insurance Policy - Consumer Protection Act - [Section 45 of the Insurance Act, 1938] - The court discussed the renewal of an insurance policy, the declaration of good health, and the insurer's entitlement to call into question the policy based on inaccurate or false statements within two years of its renewal. The court found that the insurer had discharged its burden of proving the suppression of material facts by the insured, leading to the repudiation of the liability to pay the benefits under the policy.
Fact of the Case:
The petitioner, a beneficiary under her estranged husband's insurance policy, challenged the dismissal of her complaint under the Consumer Protection Act after the insurer repudiated the liability to pay the benefits under the policy.
Finding of the Court:
The court found that the insurer had discharged its burden of proving the suppression of material facts by the insured, leading to the repudiation of the liability to pay the benefits under the policy.
Issues: The issues involved the renewal of the insurance policy, the declaration of good health, and the insurer's entitlement to call into question the policy based on inaccurate or false statements within two years of its renewal.
Ratio Decidendi: The court held that the insurer is entitled to call into question the policy based on inaccurate or false statements within two years of its renewal, and found that the insurer had discharged its burden of proving the suppression of material facts by the insured.
Final Decision: The petition was dismissed, and the rule was discharged with no order as to costs.
Heard Shri Mulgaonkar, the learned Counsel for the petitioner. None for the respondent.
2. By this petition, the petitioner who is the beneficiary, under the insurance policy of her estranged husband, is challenging the dismissal of the complaint filed under the Consumer Protection Act. The Consumer Disputes Redressal Forum (District Forum), by order dated 15.12.2009 has dismissed the complaint, which was challenged by the petitioner before the State Consumer Disputes Redressal Commission (State Commission). The State Commission vide order dated 19.03.2010, has concurred with the findings of the District Forum. Hence, this petition.
3. The brief facts are that the late husband of the petitioner, namely, Valerian Colaco had taken out three insurance policies bearing nos. 111654322, 111648920 and 930290496. The present dispute pertains to the third policy, namely, policy no. 930290496, which was taken out on 28.03.1999 (hereinafter referred to as the said policy). It appears that on account of failure to pay the premium, the said policy got lapsed. The petitioner paid the premium and sought renewal of the said policy on 22.01.2001, which was after six months from June, 2000, when the premium was defaulted. The insured i.e. the deceased husband of the petitioner had furnished a declaration of good health on 22.01.2001 and on the basis of the same, the policy was revived. Subsequently, Mr. Valerian Colaco passed away on 12.04.2001.
4. Undisputedly, the petitioner was the nominee under all the three policies and she has received payment in respect of the first two policies. As the respondent failed to pay the claim under the said policy, the petitioner approached the District Forum, claiming that there was deficiency in service by the respondent. The respondent claimed that in the interregnum i.e. after the said policy lapsed, the deceased (insured) was diagnosed with diabetes as well as 'Adeno Carcinoma', which the deceased failed to disclose in the declaration of good health and therefore, the respondent repudiated the liability to pay the benefits under the said policy.
5. The District Forum and the State Commission have upheld the defence.
6. At the outset, it is necessary to note the decision of the Supreme Court in the case of Cicily Kallarackal Vs. Vehicle Factory, (2012) 8 SCC 524, in which the Supreme Court has inter alia held that in view of an alternate statutory remedy of appeal, the High Court would not entertain a petition under Article 226/227 of the Constitution of India. The said case arose under the provisions of the very Act viz. the Consumer Protection Act, in which the order of the National Consumer Disputes Redressal Commission (National Commission) was challenged before the High Court, when there was a remedy of statutory appeal before the Supreme Court. Here is a case where the petitioner has not even approached the National Commission and the challenge in the present petition is to the order of the State Commission. For this reason alone, I find that the petition cannot be entertained. However, looking to the fact that Rule was issued in the year 2011, I have heard the learned Counsel for the petitioner on merits also.
7. The declaration of good health (to the extent relevant) given by the insured reads thus:
DECLARATION OF GOOD HEALTH
1. I hereby declare that I am in good health and that I have not undergone any operation or suffered from any illness nor I have been advised to go in for any treatment or take an X-Ray, ECG, Pathological and other tests since the date of the proposal or last revival to this date. I further declare that no proposal for assurance or any application for revival of a policy on my life is pending or has been withdrawn or dropped, or deferred or declined or accepted at an increased premium or subject to a lien or on terms other than as proposed.
8. It can thus be seen that the declaration is exhaustive and the declarant is expected to disclose not only the details of ailment alre
