Shriram Life Insurance Company Limited represented v. Md. Idu

CORAM: HON'BLE MR. JUSTICE SHREE CHANDRASHEKHAR HON'BLE MRS. JUSTICE ANUBHA RAWAT CHOUDHARY For the Appellant For the Resp. No. 1 : Mr. Ajay Kumar Pathak, Advocate : Mr. N. N. Mishra, Advocate : Mr. Manisha Srivastava, Advocate : Mr. Manish Kumar, Advocate : Mr. Shivam Kumar, Advocate : Mr. Vijay Shankar Jha, Advocate : Mr. Raj Dular Sah, Advocate --------------- Order No. 09/ Dated: 01st August 2023 For the Resp. No. 2 I.A. No. 1210 of 2023 This application has been filed seeking condonation of delay of 77 days in filing the present Letters Patent Appeal. 2. stated as under: In this interlocutory application the insurance company has “4. That by way of the instant interlocutory application the appellant prays for condoning the delay in filing of the instant appeal which has been filed on 23-11-2022 after a delay of about 77 days whereas the limitation expired on 7-9-22.

5. That on receipt of the certified copy of the impugned order, the counsel conducting the case of the appellant gave his opinion to the concerned Branch for filing of the appeal before this Hon’ble Court on the grounds set forth in the memorandum of appeal. 2

6. That the appellant – company is under the administrative control of Hyderabad office and for filing of any appeal, sanction from the competent authority is required as per the procedural norms of the company.

7. That the appellant states and submits that the entire file relating to the records of the case were sent to Hyderabad Officer which is the immediate controlling office under whose jurisdiction the case is being monitored and conducted before this Hon’ble Court.

8. That the Hyderabad Office sends the file for obtaining legal opinion from one of its penal counsel with regard to prepare an appeal before this Hon’ble Court and after obtaining opinion, the Hyderabad Office got sanction in the matter of preferring this appeal.

9. That it is stated and submitted that the case record was sent to the Counsel at Ranchi for filing the present appeal, thereafter he drafted and prepared the memo of appeal and immediately thereafter the same has been filed before this Hon’ble Court on 23- 11-2022 without any delay.

10. That in all these exercises considerable time was consumed in preferring the appeal before this Hon’ble Court. Though the prescribed time for filing the appeal was 30 days, but it could not be presented in time for the reasons as stated hereinabove and there has been a delay of about 77 days in filing the appeal application.”

3. Opposing I.A. No. 1210 of 2023, the respondent no.1 (hereinafter referred to as the claimant) has taken a stand that the aforesaid statements made in paragraph nos. 5 to 9 are not substantiated by any corroborative documentary evidence. The claimant has referred to the judgments in “Esha Bhattacharjee v. Managing Committee of Raghunathpur Nafar Academy and Ors.” (2013) 12 SCC 649 and “State of Uttar Pradesh v. Amar Nath Yadav” (2014) 2 SCC 422 to submit that the proforma plea of movement of files from one department to another cannot be a ground for condoning the delay. 4. Mr. Manish Kumar, the learned counsel for the claimant has referred to paragraph no. 21.5 in Esha Bhattacharjee to submit that the present interlocutory application lacks bonafide. 5. No doubt there cannot be a distinction between the institutional litigants and a private party in the matters of condonation of delay and generally the applicant should provide a plausible explanation to the delay caused in filing the petition/appeal. However while entertaining the application under section 5 of the Limitation Act the Courts are only required to ascertain that the stand put forth by the applicant is acceptable or not. At the same time, the Courts may look at a probable loss caused to the applicant if delay in filing the petition/appeal is not 3 condoned. 6. As we gather from the materials on record, the insurance company has all along taken a ground of suppression of material facts to deny the claim and to repudiate the insurance policy. The claimant has also referred to a judgment of the High Court of Rajasthan at Jaipur Bench to support the writ Court’s order directing reimbursement of the death claim. 7. Having regard to the contentious issue raised by the parties in the present proceeding, we deem it necessary to condone the delay of 77 days in filing the present Letters Patent Appeal and accordingly, I.A. No. 1210 of 2023 is allowed. LPA No. 585 of 2022

8. The insurance company has challenged the order passed by the writ Court in W.P.(C) No. 1884 of 2019 by which the decision of the Ombudsman awarding claim of Rs. 3,00,000/- has been affirmed. 9. The facts disclosed by the parties would indicate that a life claim policy dated 8th January 2015 for wife of the claimant was accepted on 8th January 2015 for Rs. 3,00,000/- . Mrs. Bibi Rumiyan who is the wife of the claimant unfortunately died on 01st September 2015 and, therefore, the insurance claim was raised by him. After an enquiry in the matter, at the instance of the insurance company by Maddox Investigation Services Private Limited, it was found that the wife of the claimant was taking treatment for kidney ailment and in connection thereof she had gone to Kolkata at Sambhunath Pandit Hospital. There she had undergone medical tests on 29th October 2014 and 30th October 2014 and was diagnosed kidney problem for which she was advised dialysis. Based on the aforesaid investigation report, the insurance policy was repudiated on 31st July 2017. However the claimant was advised to approach Internal Claims Review Committee which also rejected the claim but with an advice to the claimant to approach the Insurance Ombudsman. 10. following stand: Before the Ombudsman, the insurance company has taken the “6. It is submitted that on perusal of the Investigation report it reveals that the deceased Life Assured Mrs. Bibi Rumiyan was suffering from kidney ailments and was taking treatment for the same at Sambhu 4 Nath Pandit Hospital, Kolkata and at Sadar Hospital, Sahibganj, Jaharkhand. As per the Medical Record, the deceased life assured was treated at Sambhu Nath Pandit Hospital Kolkata on 24.10.2014 wherein in the Clinical Diagnosis it is stated as CKD (Chronic Kidney Disease) the same being prior to signing of the proposal form for insurance dated 31.12.2014. Further, the deceased life assured belongs to BPL family, whereas in the proposal form she had mentioned her income to be Rs.1,20,000/- p.a. from business. The Diagnosis Report reveal that the deceased life assured was suffering from the kidney related ailments which is prior to the proposal date. She was treated in the said hospital as 'Non- paying' patient which further authenticates that she belonged to BPL family. 7. It is submitted that at the time of proposal the deceased Life Assured late Bibi Rumiyan had mentioned herself to be in good state of health and earning Rs.1,20,000/- p.a. Based on her declarations, the said policy was issued covering the life of the deceased policy holder in all good faith. 8. It is submitted that Life insurance policies are Contracts governed by the principle of "Uberrima Fidei", wherein the policy holder is supposed to disclose all the material facts regarding his/her health condition, habits, family history, personal medical history, income etc of the life proposed for insurance by giving correct answers to the questions in the proposal form. But, the Life Assured claimed that she was in good health by suppressing the actual facts relating to her health and income in the proposal form by giving the following answers to the questions mentioned below: Question No.9 Personal Medical History of the Life to be assured: Answer the following as Yes/No C. Are you at present in good health? Answer: "Yes"

3. Have you ever suffered from any of the following disease? (ii) Kidney dysfunction (viii) Any other health ailment Answer: "No" 9. It is submitted that had deceased Bibi Rumiyan given correct information regarding her health and income then this would have influenced the decision of underwriters of the Company in issuance of the policy. It is further submitted that, the Life Assured Bibi Rumiyan was well aware of the said ailments and financial status before submitting the Proposal Form and inspite of it she willfully did not disclose her illness/or the treatments undergone and actual income, at the time of applying for the policy, which is a deliberate concealment of material facts with fraudulent intentions. The copies of the Medical Records are filed herewith for kind perusal of this Hon'ble Ombudsman. 10. It is submitted that, upon relying on the veracity of the information contained in the Proposal Form, the Company had issued the subject Policy providing a life cover of Rs.3,00,000/- along with Accidental Riders such as (AR) and Family Income Benefit Rider (F.I.B) to the Life Assured. Further, the above mentioned facts clearly indicate that the Life Assured had apprehensions about her life and it is because of this apprehension, she had obtained the insurance policy for covering risk on her life for a sum assured amount of Rs.3,00,000/- from the company by deliberately making false as well as information regarding her illness and income in the Proposal Form. 11. It is pertinent to mention here that, any fact which would influence the mind of a prudent insurer in deciding whether to accept or not to accept the risk is a "material fact". If the proposer/Life Assured has knowledge of such fact, he/she is obliged to disclose it particularly while answering questions in the proposal form. Needless to emphasise that any inaccurate answer will entitle the insurer to repudiate its liability because there is clear presumption that any information sought for in the Proposal Form is material for the purpose of entering into a Contract of Life Insurance. 12. In view of the above mentioned facts and circumstances the claim was repudiated on 31.07.2017, which was based on sound principles of law.” incorrect statements and withholding material 5

11. The learned Ombudsman having regard to the materials placed before him has held that repudiation of the insurance policy was not justified. The reason assigned by the learned Ombudsman is that Mrs. Bibi Rumiyan was suffering from malaria which caused her death, and this fact has been confirmed by the Sadar Hospital, Sahibganj. 12. The learned Ombudsman has held as under: “22) Result of hearing with both parties (Observations & Conclusion):- The Deceased Life Assured had taken a policy from the Respondent Insurer on 08.01.2015. The Deceased died of malaria on 01.09.2015. The Claim filed by the Complainant was however repudiated by the Respondent as the Deceased had kidney problem prior to taking the Policy and the same was not disclosed in the proposal form. From the Documents submitted it is observed that the deceased had kidney problem however the deceased life assured had died not due to kidney problem but due to malaria as confirmed by the Sadar Hospital. In view of the above facts and circumstances denial of the claim by the Respondent is not justified and their decision is hereby set aside. AWARD Taking into account the facts & circumstances of the case and the submissions made by both the parties during the course of hearing, the Respondent is ordered to pay the death claim of Rs. 300000/- to Md. Idu. Hence, the Complaint is accordingly disposed off.”

13. The writ Court has approved the order passed by the Ombudsman taking note of the fact that Mrs. Bibi Rumiyan has died due to malaria. 14. Now in the aforesaid fact-situation, this Court exercising powers under Clause 10 of the Letters Patent shall be reluctant to enter into the facts of the case. There is a concurrent finding of fact by the Ombudsman and the writ Court that Mrs. Bibi Rumiyan has died due to malaria. However, at no stage, the insurance company seems to have controverted this fact certified by Sadar Hospital at Sahibganj. 15. There is another reason why this Court should not interfere in this matter. As it is appearing from the pleadings of the parties, the insurance company has taken a stand of suppression of “material facts”. According to the insurance company, Mrs. Bibi Rumiyan was suffering from serious kidney ailment before 8th August 2015 but this fact was not disclosed in the insurance policy. 16. In “Arunima Baruah v. Union of India” (2007) 6 SCC 120 the 6 Hon’ble Supreme Court has observed as under: “12. It is trite law that so as to enable the court to refuse to exercise its discretionary jurisdiction suppression must be of material fact. What would be a material fact, suppression whereof would disentitle the appellant to obtain a discretionary relief, would depend upon the facts and circumstances of each case. Material fact would mean material for the purpose of determination of the lis, the logical corollary whereof would be that whether the same was material for grant or denial of the relief. If the fact suppressed is not material for determination of the lis between the parties, the court may not refuse to exercise its discretionary jurisdiction. It is also trite that a person invoking the discretionary jurisdiction of the court cannot be allowed to approach it with a pair of dirty hands. But even if the said dirt is removed and the hands become clean, whether the relief would still be denied is the question.”

17. Now as understood in the legal parlance, the suppression of material facts has to be examined in the context of the facts of the case. In this context therefore it shall be required to examine whether by such suppression the person has obtained some benefit. As the cause of the death of Mrs. Bibi Rumiyan is malaria, and not any kidney ailment, suppression of this fact that she was suffering from kidney ailment shall not have any material effect on the insurance claim raised on account of the death of Mrs. Bibi Rumiyan. 18. reason to interfere with the writ Court’s order dated 08th August 2022 With the following discussions in our mind, we do not find a and, accordingly, LPA No.585 of 2022 is dismissed. (Shree Chandrashekhar, J.) (Anubha Rawat Choudhary, J.) Saurav/Pankaj-