The burden of proving false representations and suppression of material facts in an insurance claim lies with the insurance company, and in the absence of credible evidence, the claim cannot be repudiated.

1. Kotak Mahindra Old Mutual Life Insurance Ltd., (hereinafter to be referred to as the 'petitioner') has filed this petition under Article 226 of the Constitution of India read with Section 103 of the Constitution of Jammu & Kashmir for quashing of order and judgment dated 23.09.2009 passed by the J&K State Consumer Disputes Redressal Commission, Jammu i.e. respondent No. 1 in Appeal No. 2884/2007 titled as 'Kunti Devi V. Kotak Mahindra Old Mutual Life Insurance Ltd.' wherein the petitioner has been directed to pay to respondent No. 2 a sum of Rs. 3,00,000 along with interest® 9% per annum w.e.f. 16.05.2005 till dates of payment as also litigation expenses to the tune of Rs. 6,000. Vide order of this Court dated 31.07.2014, application for impleading legal heirs of deceased respondent No. 2 was allowed and the two sons and one daughter of deceased respondent No. 2 through their legal guardian were brought on record.

2. Brief facts necessary for the adjudication of the instant petition are that:-

Insurance Policy was taken by the husband of respondent No. 2 (hereinafter referred to as the life insured) on 21.09.2004 from the petitioner, but on 07.10.2004, the life insured unfortunately died. Claim was filed by respondent No. 2 i.e. widow of the deceased life insured, but the same was repudiated by the petitioner on the grounds as mentioned in the Letter of Repudiation i.e. Annexure P-5A. Relevant extract of the same is reproduced hereunder:-

“The information, now available in our possession, reveals that:

1. The Life Insured Mr. Swarn Singh had in his Proposal not disclosed that he was suffering from Cardio Respiratory Infection since past 1-2 years and was also suffering from moderate hypertension;

2. He had an attack of infective hepatitis 5-6 months prior to his death; (in both the above instances prior to the date of the said Proposal/Policy.

The above facts were not conveyed by the life insured to the Company in the referred Proposal Form. It be noted that, all the health questions in the Proposal Form specifically dealing with the state of health of the life insured were answered/responded to in the negative. We reproduce, hereunder, Questions from the Proposal Form in response to which there has been material non-disclosure by the Life Insured. All these questions have been replied/ responded to in the negative/ incorrectly:-

Under Clause 15(a) of Proposal Form;

Has the Life to be Insured consulted a Medical Practitioner for any ailment/in jury requiring treatment for more than 7 days? (during the last three years)

Under Clause 15(c) of Proposal Form;

Has the Life to be Insured undergone any cardiological/ pathological or radiological tests? (during the last thee years)

Under Clause 16(a) of Proposal Form;

During the lifetime, has the Life to be Insured ever suffered from:

High or low blood pressure, rheumatic fever, chest pain, myocardial infraction or any other disease or disorder of the heart or arteries?

Since material information, as detailed above, was not disclosed, by the Life Insured at the point of submission of the said Proposal, the Company was not able to correctly assess the risk that it was asked to undertake there under. Had the Life Insured disclosed the above facts, the Company- would not have accepted the proposal for insurance at that point of time.”

3. Pursuant to the repudiation of the claim by the petitioner, respondent No. 2 filed a complaint before the Divisional Forum Jammu, which relegated respondent No. 2 to avail remedy, if so advised, before the Civil Court in the background of alleged suppression of material facts, order of repudiation not being said to have been passed in a mechanical and routine manner, questions involved being such which could not be decided in a summary manner etc. In directing respondent No. 2 to avail remedy if so advised before the Civil Court, the Divisional Forum relied on the decision of the Hon’ble Supreme Court in case titled as 'Oriental Insurance Co. Ltd. v. M