Validity of insurance policy cancellation and burden of proof in cases of alleged suicide under the Consumer Protection Act.

Mr. Justice V.K. Agrawal, President—This appeal under Section 15 of the Consumer Protection Act, 1986, is directed against the order dated 5.11.2004 in Complaint No. 31/2004 by the District Consumer Disputes Redressal Forum, Durg (hereinafter called the ‘District Forum’ for short) directing the appellant/insurer to pay to the complainant/respondent Rs. 5 lacs with interest @ 9% per annum as also Rs. 500 as cost of the complaint.

2. The deceased insured Pawan Kumar Dhankar was the employee of the Bhilai Steel Plant and member of Indian National Trade Union Congress (hereinafter called the ‘INTUC’ for short). The appellant/Oriental Insurance Co. Ltd., issued Janta Personal Accident Policy (hereinafter called the ‘Janta Policy’ for short) to the members of the INTUC. Under the said policy, it was stipulated that, in case of death of the member covered under the policy, in an accident the assured amount of Rs. 5 lacs would be paid by the appellant/insurer. The risk was covered from 9.1.1999 to 8.1.2011. It is also not in dispute that certificate of insurance No. 27809 marked Annexure A-6, filed in this appeal, was issued by the appellant, in favour of the said Pawan Kumar Dhankar. It is further not in dispute that the deceased Pawan Kumar Dhankar died on 14.11.2003, allegedly, while crossing the railway line. The complainant, therefore, lodged a claim with the appellant/insurer, by letter dated 13.1.2004 (Annexure A-28). Her claim was, however, repudiated by the appellant/insurer by their letter dated 16.1.2004 (Annexure A-27) on the ground that the said Janta Policy was cancelled by the appellant by their letter dated 26.11.2001 (Annexure A-14). Feeling aggrieved, by the repudiation as above the complainant approached the District Forum.

3. The complaint was resisted by the appellant/insurer mainly on the ground that the policy was cancelled by their letter dated 26.11.2001 addressed to the INTUC. It was further averred that since the deceased has committed suicide, there was breach of terms of policy and, therefore, the appellant/insurer was not liable to pay the assured amount under the policy.

4. The District Forum repelled the averments and contentions of the appellant/insurer as above and allowed the complaint. It was directed that the appellant/insurer shall pay to the complainant Rs. 5 lacs with interest etc. as mentioned above.

5. The submissions of the learned Counsel for the appellants were heard. Record perused.

6. It may be noticed that the repudiation by the appellant/insurer of the complainant’s claim, was made by letter dated 16.1.2004 Annexure (A-27). In the said letter, it was stated that, since the Janta policy has already been cancelled by letter dated 26.11.2001, the complainant’s claim cannot be accepted. The said letter dated 26.11.2001 (Annexure A-14) has also been placed on record of this appeal. The perusal of the said letter discloses that it was not addressed to the insured Pawan Kumar Dhankar. It may be noted in the above context that as per policy conditions, the cancellation could be made by sending intimation, in writing to the insured. Since, it has not been so done in the instant case, the averments and contentions raised on behalf of the appellant/insurer that the policy stood cancelled; cannot be upheld. In fact, the matter has been considered on several occasions by this Commission and it has been held that as there was no due cancellation of the policy, the complainant beneficiary could not be denied benefit thereunder. Hence, repudiation of the complainant’s claim on the ground that the policy was cancelled by letter on 16.1.2004 (Annexure-27), was not justified.

7. Though repudiation was based solely on the above ground; we shall now consider the submission of the learned Counsel for the appellant that the death of the deceased was suicidal. In the above context, the learned Counsel submitted that, as per the ‘Panchnama’ of the dead body, the deceased was found lying near the railway line