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MADHYA PRADESHSTATE CONSUMER
DISPUTES REDRESSAL COMMISSION, BHOPAL
Hon’ble Mr. Justice S.K. Dubey, President & Mrs. Saroj Rajwade, Member
NARANGI DEVI SHARMA—Appellant
versus
DIVISIONAL MANAGER, LIFE INSURANCE CORPORATION OF INDIA & ORS.—Respondents
Appeal No. 25 of 1997—Decided on 7.1.1999
Counsel for the Parties :
For the Appellant :Mr. C.S. Agrawal, Advocate.
For the Respondents:Mr. B.L. Agrawal, Advocate.
A contract of insurance is based on the principle of "uberrimae fidei", requiring utmost good faith and full disclosure of all material facts by the insured. Misrepresentation or concealment of material facts by the insured can lead to repudiation of the claim by the insurer.
Headnote:
CONSUMER PROTECTION ACT, 1986 - SECTION 24-A - LIMITATION - INSURANCE - UBERRIMAE FIDEI - REPUDIATION OF CLAIM - MONEY BACK POLICY - AGE MISREPRESENTATION - SECTION 39 OF THE INDIAN CONTRACT ACT - RESCISSION OF CONTRACT - SUMMARY DISMISSAL OF APPEAL WITH NO ORDER AS TO COSTS.
Fact of the Case:
The complainant, a widow, filed a complaint against the opposite party, LIC, for repudiating the claim under a money back policy issued to her deceased husband. The deceased had obtained the policy by misrepresenting his age, which was 53 years at the time of taking the policy, while he stated it as 45 years. The opposite party repudiated the claim on the ground of misrepresentation of material information.
Finding of the Court:
The District Forum dismissed the complaint as barred by limitation and on merits, holding that the deceased had suppressed material information about his age and date of birth, which would have prevented him from obtaining the money back policy. The State Commission upheld the order of the District Forum, finding that the repudiation of the claim was justified and that there was no deficiency in service on the part of the opposite party.
Issues: 1. Whether the complaint was barred by limitation? 2. Whether the deceased had suppressed material information about his age and date of birth? 3. Whether the repudiation of the claim was justified?
Ratio Decidendi: 1. The limitation period for filing a complaint under the Consumer Protection Act, 1986 is two years from the date of cause of action. The cause of action in the present case arose on receipt of the letter dated 28.3.1992, repudiating the claim. The complaint was filed after three and a half years, i.e., on 5.10.1995, and the complainant failed to provide any sufficient cause for the delay. 2. The principle of "uberrimae fidei" applies to contracts of insurance, requiring utmost good faith and full disclosure of all material facts by the insured. In the present case, the deceased had suppressed material information about his age and date of birth, which would have prevented him from obtaining the money back policy. 3. The repudiation of the claim by the opposite party was justified as the deceased had obtained the policy by misrepresentation of material information. There was no deficiency in service on the part of the opposite party.
Final Decision: The appeal was dismissed with no order as to costs.
Mr. Justice S.K. Dubey, President—This is a complainant’s appeal under Section 15 of the Consumer Protection Act, 1986 (for short ‘Act’) against the order dated 30.4.1997 passed in Case No. 332/1995 by the District Consumer Disputes Redressal Forum, Jabalpur (for short the ‘District Forum’).
2. Facts giving rise to this appeal are thus that the complainant is a widow of the deceased Hukum Singh Sharma, who got his life assured by a “Money Back Policy” No. 370319305 dated 28.3.1991, maturity date of which was 28.3.2011. After payment of two quarterly premiums of Rs. 952.50 paise the assured died of cardiac arrest on 29.7.1991. The complainant as nominee claimed the amount of Rs. 50,000/- with its benefits. The opposite party made certain enquiries and asked for documentary proof of the age of the deceased. The complainant sent the documents and the certificate of the Principal of J.K. School, Lodhai (U.P.) wherein in the school admission register in the year 1945 at admission No. 170 the age of the deceased was recorded as 30th June, 1938. On receipt of the age certificate the opposite party decided to repudiate all liabilities under policy on account of the deceased having withheld material information regarding his age at the time of effecting the insurance, as in the proposal in answer to querry No. 3 requiring the assured to give his age and date of birth, he gave the age as 45 years and date of birth as 12.11.1945. The age and date of birth so declared by the deceased was false. There was a difference of the age of 8 years, the deceased at the time of filing of the proposal form was 54 years while he stated his age as 45 years so as to induce the opposite party to obtain the money back policy on the false statement given by him. A letter dated 28.3.1992 repudiating the liability was sent to the complainant. On this complainant wrote a letter dated 25.6.1993 asking for the reason of repudiation of the claim. The opposite party vide letter dated 11.10.1993 restated the reason of repudiating the liability. The complainant on 5.10.1995 filed the complaint under Section 12 of the Act. The complaint was resisted by the opposite party as the complaint was barred by time. On merits it was stated that the assured declared his date of birth as 12.11.1945, therefore, the policy was issued on the declaration so given by the deceased in good faith. However, information so given was found to be false. Actually the deceased was overage at the time of taking of the policy he was of 53 years. He was not competent to get the money back policy as the maximum permissible maturity age is 65 years and maximum permissible age at entry is 45 years, hence the plan for less term than 20 years could not have been granted. The assured obtained the policy by misrepresentation of his age. The opposite party is not liable of any payment under the policy and all the moneys that has been paid in consequence thereof stand forfeited. In the circumstances, there was no deficiency in service rendered by the opposite party.
3. The District Forum after considering the material on record held that the complaint was barred by time as the cause of action arose on receipt of the letter dated 28.3.1992 and the complaint was filed after three and half years i.e. on 5.10.1995. On merits, the District Forum held that the deceased has suppressed the material information about his age and date of birth. If that information would have been correctly disclosed, the deceased could not have obtained the money back policy. Therefore, the repudiation of all liabilities under the policy was on justifiable grounds, hence dismissed the complaint.
4. Having heard learned Counsel for the parties and on going through the record we are of the opinion that this appeal is devoid of any merit. Section 24-A of the Act prescribes the limitation of two years for filing the complaint from the date of cause of action has arisen. The cause of action in the present case arose on receipt of t
