Deoki Nandan, J. - (1.) This is a plaintiff's second appeal in a suit for recovery of Rs. 13,300/- on the foot of an Insurance Policy on the life of one Nana Lal Jagjeewan Sanghavi deceased. The plaintiff was his widow and having died in the course of the appeal in this Court, she is now represented by her heirs and legal representatives.
(2.) The proposal for insurance is dated 30th March. 1964 and was accepted vide letter/receipt issued by the defendant Life Insurance Corporation of India, Ext. 8. The insured appears to have been aged about 56 years at the time of the proposal for insurance and died of "Heart Failure" on 29th October, 1965. The plaintiff, being the nominee appointed by the insured, claimed the amount of insurance, but her claim having been repudiated by the defendant Life Insurance Corporation of India, she filed the suit giving rise to this second appeal. The suit has been dismissed by both the courts below on the ground that the deceased had suffered from carbuncle and diabetes; that he suppressed this fact in the personal statement made by him along with his proposal for the insurance: and that the contract of insurance was void on account of the said misrepresentation.
(3.) I have heard learned counsel for the parties. It is common ground that the deceased having died within two years of taking the insurance policy; Section 45 of the Insurance Act, 1938, is out of the way, and the matter is governed by Section 19 of the Contract Act which runs as under: "When consent to an agreement is caused by coercion, fraud, or misrepresentation, the agreement is a contract voidable at the option of the party whose consent was so caused. A party to a contract, whose consent was caused by fraud or misrepresentation, may, if he thinks fit, insist that the contract shall be performed, and that he shall be put in the position in which he would have been if the representation made had been true. Exception:-- If such consent was caused by misrepresentation or by silence, fraudulent within the meaning of Section 17, the contract, nevertheless, is not voidable, if the party whose consent was so caused had the means of discovering the truth with ordinary diligence. Explanation:-- A fraud or misrepresentation which did not cause the consent to a contract of the party on whom such fraud was practised, or to whom such misrepresentation was made, does not render a contract voidable." Misrepresentation is defined as under by Section 18: "18. Misrepresentation means and includes: (1) the positive assertion in a manner not warranted by the information of the person making it, of that which is not true, though he believes it to be true; (2) any breach of duty which, without an intent to deceive, gains an advantage to the person committing it, or anyone claiming under him, by misleading another to his prejudice or to the prejudice of any one claiming under him; (3) causing, however innocently, a party to an agreement, to make a mistake as to the substance of the thing which is the subject of the agreement." Although it has been suggested in paragraph 20 of the written statement that the misstatements and suppression were fraudulently made, but it does not appear that the defendant Corporation relied on any fraud having been practised by the deceased, within the meaning of Section 17 of the Contract Act. The following were the pleas taken by the defendant Corporation for avoiding all liability on the policy in question : "13. That a proposal for being assured for a sum of Rs. 10,000/- was made by Nandlal Jagjiwan Lal Sanghvi on 30th March, 1964. In the said proposal Sri Sanghavi made a declaration that the statements and answers contained in the proposal form were true in every particular and further agreed and declared that those statements and declarations along with further statements made before the Medical Examiner shall be the basis of contract of insurance between him and the defendant and if any untrue averment be contained therein, the contract shall be absolutely null and void and all moneys which shall have been paid in respect thereof, shall stand forfeited to the defendant. "14. That in the Personal Statement dated 30th March 1964 made by the assured he declared that the answers given therein had been so given after fully understanding the questions and that the same were true in every particular and that he had not withheld any information. He futher agreed that the declarations together with the proposal form of insurance shall be the basis of contract between him and the defendant. "15. That the personal Statement inter alia contained the following questions the replies to which were false to the knowledge of the assured : 4 (d) Have you consulted a Medical practitioner within the last five years ? 6. Have you suffered from any of the following ailments ? (e) Any skin eruption ? (g) (i) Any affection of kidney or bladder ? (k) (iii) Any other illness within the last five years requiring treatment for more than a week ? "16. That he was also put in the same statement the following questions: (7) Have you ever passed blood, pus, albumen or sugar in the urine ? (8) Did you have any operation ? "17. That the answer to all the aforesaid questions was in the negative. "18. That on a claim being made so shortly after the date of assurance, the Corporation made investigations and it appeared therefrom that the assured had inter alia suffered from carbuncle and diabetes prior to his making proposal for the insurance and he had consulted and taken treatment from Medical Practitioner in regard to the same. "19, That the averments in the plaint that the assured never suffered from any carbuncle or diabetes or did not consult any medical practitioner for the same is incorrect and has been made for the purposes of this suit. "20. That on account of the misstatements made by the assured which were in respect of material matters and because the assured suppressed facts which it was material to disclose, the policy, is void, the misstatements and suppression being false to the knowledge of the policyholder and material to be disclosed. The misstatements and suppression were fraudulently made. "21. That because of inaccurate and false answers given in the proposal and the personal statement, in terms of agreement between the parties as contained in the proposal, the personal statement and the policy, the policy became void and the claim, was therefore, rightly repudiated by the defendant. "22. That both carbuncle and diabetes are such diseases which could not have been detected at the time of the Medical Examination. In any event because of the express stipulations and agreement between the parties, the mis-statements and Suppression aforesaid render the policy void and the assertion that the medical doctor could not detect the aforesaid diseases at the time of medical examination cannot help the plaintiff. "23. That the acceptance of the proposal was recommended by the doctor and the agent because of the misstatements and suppressions made by the assured. The suggestion that the doctor verified by means other than the answers given by the assured that the assured had never suffered from carbuncle or diabetes is wholly incorrect. The plaintiff is put to strict proof thereof. "24. That the report of the doctor or the agent is not binding on the Corporation more so when it is due to misstatement and suppression of material facts by the assured. The Corporation cannot be estopped from repudiating the claim on that gDround.";