ORDER

DR. INDER JIT SINGH, PRESIDING MEMBER

1. The above two cross-appeals have been filed under Section 19 of the Consumer Protection Act, 1986 against the common order dated 29.09.2016 of the Maharashtra State Consumer Disputes Redressal Commission, Mumbai (hereinafter referred to as the 'State Commission'), in Consumer Complaint No. 777/2015. Since both the Appeals arise from the same impugned order and involve identical facts and common questions of law, they are being disposed of by this common judgment.

2. The brief facts of the case are that the Complainant, Mrs. Jayshree Suresh Gambhir, is the mother and nominee of the deceased life assured, Late Shri Nitin Suresh Gambhir. The Life Assured had submitted five life insurance proposals to the Life Insurance Corporation of India (LIC) on 27.06.2010. Based on these proposals, five policies were issued.

3. The Life Assured died on 11.06.2013 due to cardiac arrest. The Complainant filed a death claim with LIC, which was repudiated vide letter dated 11.07.2014 on the ground of non-disclosure of material facts, specifically that the Life Assured was a known case of Diabetes Mellitus and was admitted to Hinduja Hospital from 11.09.2010 to 13.09.2010 for treatment of a non-healing ulcer and cellulitis, which treatment he had not disclosed in the proposal form.

4. The Complainant filed a Consumer Complaint before the State Commission. The State Commission, vide its impugned order, partly allowed the complaint. It directed LIC to pay the sum assured of ₹10,00,000/-, ₹15,00,000/- and ₹15,00,000/- for the first three policies (Nos. 903849828, 903849829, 903849830) along with interest @9% per annum from the date of repudiation, as well as ₹1,00,000/- for mental agony and ₹25,000/- as costs. However, the State Commission upheld the repudiation of the claim for the last two policies (Nos. 903850469, 903850470). Hence, LIC has filed FA/32/2017 challenging the allowance of the first three policies, and the Complainant has filed FA/462/2018 challenging the dismissal of her claim for the last two policies. Extract of relevant para of state commission order is reproduced below.

(7) With the able assistance of learned advocates, we have perused the record and documents relied upon by the parties. It is not in dispute that the opponent had issued 5 (Supra) policies to the deceased life assured, who was carrying the business. All policies were issued after carrying out medical examination from the panel doctor of the opponent. Such a medical examination was completed prior to issue of policies and only after satisfactory report from the medical panel doctor, the underwriters on behalf of the opponent processed the proposal and issued the policies.

(8) Ld. Advocate Mr. Vidyarthi relied on following author support of his contentions to justify the repudiation of the claim on the ground of suppression of material facts:

(i) Satwant Kuvar Sandhu Vs. New India Assurance Co. Ltd. In Civil Appeal no. 216 of 2002 decided on July, 2009, reported in (2009) 8 Supreme Court Cases 316. It was ruled by the Hon'ble Apex Court that obligation of the life insured to disclose material facts extends only to facts which are known to the life insured and not to what he ought to have known and whether the information sought for is material for the purpose of policy is a matter to be determined by the proposer i.e. life insured. Non-disclosure of facts as to his illness by insured in the proposal form though he was suffering from certain diseases at the relevant time tantamount to suppression of material facts enabling the insurer to repudiate its liability under the policy.

In this Consumer complaint the proposal form was duly filled in by the insured on 17/05/2010 and submitted to opponent. The question did not arise to disclose diabetes mellitus which was diagnosed only on 11/09/2010 by the treating doctor at P.D. Hinduja Hospital and Research Centre. Diabetes mellitus was not well within his knowledge till it was