LIFE INSURANCE CORPORATION OF INDIA Vs. SANTOSH

JUDGEMENT

(1.) Life Insurance Corporation of India has come up in appeal against the order dated 22nd July, 1998 passed by the learned District Forum, Panchkula, whereby complaint of Mrs. Santosh wd/o of late Shri Lal Chand alleging deficiency in service on the part of L. I. C. in realising the policy amount of Rs.50,000/- pertaining to her late husband, has been allowed by issuing the following directions: "for the reasons recorded above, this complaint is hereby accepted with the following directions: (a) that the opposite party will pay the insured amount to the complainant together with statutory bonus; (b) that the opposite party will pay interest at the rate of 15% per annum on the insured amount to the complainant w. e. f 1.2.1993 till payment of insured amount; (c) that the opposite party will pay Rs.1,000/- towards costs of proceedings. The aforesaid amount of compensation would be paid by the opposite parties to the complainant within one month from the date of communication of this order. "

(2.) According to the undisputed facts of the case, late Shri Lal Chand had taken out the insurance policy on 10th July, 1989 in the sum of Rs.50,000/- by paying initial premium of Rs.5,766/- and also two premiums for the subsequent two years. However, when he died on 28th October, 1992 i. e. after more than 3 years due to "cardio-Respiratory Arrest" i. e. heart-attack, L. I. C. did not release the amount on the ground that at the time of taking out the insurance policy late Shri Lal Chand did not disclose that he had been suffering from diabetes. The learned District Forum after examining the evidence produced by the parties allowed the complaint by directing the L. I. C. to release the requisite payment.

(3.) In the appeal before us, learned Counsel for the L. I. C. has vehemently contended that had the L. I. C. been told at the time of insurance that the complainant was suffering from diabetes then probably the L. I. C. would not have insured him. On the other hand, Mr. Davinder Kumar, learned Counsel for the complainant has vigorously pleaded that the diabetes was not such an ailment, patient whereof stood disqualified from being insured. He has placed firm reliance on the earlier decision of this Commission in First Appeal No.840 of 1996, decided on 14th March, 1997 (HSCDRC), L. I. C. V/s. Smt. Rampati, which also happened to be the case of repudiation of the claim by the L. I. C. on the same ground i. e. insured suffering from diabetes. In that case also, this Commission held that the repudiation of the claim was wholly untenable in law. In order to strengthen his argument that the insured survived more than 3 years after the date of insurance, the learned Counsel for the complainant-respondent further placed reliance on another decision of this Commission in the case of L. I. C. V/s. Smt. Bala Devi,1997 1 CPC 25, in which case, also the repudiation of the claim by the L. I. C. was found arbitrary as the insured had survived more than 3 years after the date of insurance.