The central legal point established in the judgment is the interpretation and application of Section 45 of the Insurance Act, which places the burden on the insurer to show prima facie material fact not disclosed by the life assured when the policy was taken.

Mr. Justice M.S. Parikh, President—This appeal arises from order dated 12.2.2004 rendered by the learned Consumer Disputes Redressal Forum, Ahmedabad City in Complaint No. 593 of 1997 directing the opponent Life Insurance Corporation of India (LIC for short) to pay to the complainant, widow of the life assured Rs. 50,000/- with interest @ 10% p.a. from 10.1.1996 till payment and cost and compensation in the sum of Rs. 3,000/- each on the ground that the repudiation of the claim under the policy of insurance in question amounted to deficiency in service on the part of the opponent LIC of India in absence of evidence with regard to pre-existing disease jaundice from which the deceased life assured suffered.

2. We have heard the learned Advocates for the parties. We have gone through the impugned order. We have gone through the material placed on record before the learned Forum.

3. Facts of the case run into a narrow compass. It is not in dispute that proposal for life insurance policy was submitted on 12.3.1994 and the policy of life insurance in the sum of Rs. 50,000/- was to commence from 1.3.1994. It is also not in dispute that the life assured died on 10.4.1994 on account of cardiac arrest due to infective hepatitis/hepaticoma. It is also not in dispute that the life assured was admitted to V.S. Hospital for treatment of advance stage of hepatitis on account of which the deceased life assured died. It is finally not in dispute that the complainant happens to be an employee of the opponent LIC of India who already paid the indemnity insurance of two other life insurance policies of her deceased husband.

4. It is in the background of aforesaid facts that we are required to examine the contentions of the parties. The opponent LIC repudiated the claim of the claimant in respect of the policy in question on 10.1.1996 which happened also within two years from the date of the policy. It is now settled law that under Section 45 of the Insurance Act, if the life assured dies within a period of two years from the date of the policy, what the Insurance Company is required to do is to show prima facie material fact which was not disclosed by the life assured when the policy of insurance was taken. In the present case the fact which was not disclosed was illness of jaundice from which the life assured suffered prior to the date of taking of insurance in question. This fact has been recorded in the history portion of the hospital case papers. Ordinarily the matter should have ended here itself as the burden of proof was not on LIC with regard to proving the fact that the life assured suffered from disease of jaundice. Production of the hospital case papers would have sufficed in view of aforesaid facts which related to the period during which the life assured survived. As a matter of fact, the statements appearing in the hospital case records are made in the ordinary course of hospital business and by virtue of Section 114 of the Evidence Act, that would have gone in evidence. In such an event it would be for the complainant to show by cogent evidence that any of the statements so made in the case papers was not factually correct. Reference in this connection may be made to a decision of the National Commission in the case of LIC of India v. Mohinder Kaur, reported in II (2003) CPJ 30 (NC)=2003 (4) CLD P. 317.

5. In the present case the matter did not end with the production of case papers. One Dr. Hemendra Modi performed his duty as a visiting physician in V.S. Hospital and deposed to the facts stated in the case papers. As a matter of fact he has deposed with respect to the ailment for which the deceased life assured was admitted to V.S. Hospital. It was advanced stage of hepatitis/hepaticoma. He has also referred to the statements made in the case papers signed by Dr. Raju Parmar who was not alive at the relevant point of time and, therefore, was not able to give evidence before the learned Forum. As a matter of fact when Dr. Raju Par