Judgment:
Oral Order: (Per Honble Justice D. Appa Rao, President)
1) This is an appeal preferred by the opposite party insurance company against the order of the Dist. Forum directing it pay Rs. 6 lakhs covered under the policy with interest @ 9% p.a., from the date of complaint till the date of realization together with compensation of Rs. 10,000/- towards mental agony and Rs. 1,000/- towards costs.
2) The case of the complainant in brief is that his wife Smt. Arifunnissa Begum a government teacher had taken personal accident policy with the appellant for a sum of Rs. 6 lakhs covering the period from 14.7.2000 to 13.7.2001. While so, she unfortunately met with accident on 6.8.2000 when a tempo dashed her while she was crossing the road at Annaram village and was admitted in Osmania General Hospital, and the police registered it as a case in Crime No. 83/2000 u/s 337 of IPC. Later on false information of the family members the police altered it from Section 304A to 302, 201 IPC, and a case was registered against him on the file of IIIrd Addl. Dist. and Sessions Judge, Medak u/s 301 and 201 of IPC wherein he was acquitted by judgement dt. 29.10.2004. Against the said judgement the government preferred appeal, and the Honble High Court dismissed it on 13.6.2008. When intimation was given about the incident as early as on 24.8.2008 it was repudiated on the ground that there was abnormal delay of 9 years. Therefore after issuing notice he filed the complaint for recovery of the amount covered under the policy with interest @ 36% p.a., together with compensation of Rs. 1,50,000/- towards mental agony and Rs. 5,000/- costs.
3) The appellant insurance company resisted the case. While admitting issuance of policy it averred that it was not aware that a case u/s 302 read with 201 IPC was registered against him on the false complaint made by the family members of his wife. The complainant is a retired Circle Inspector of Police. On enquiry it came to learn that the deceased was his second wife and they were divorced. She was residing separately from 1982 and that he married another woman Yavarunnisa Begum. On the fateful day the deceased was called by the complainant, and the police registered a criminal case against him u/s 302 and 201 IPC. The complainant himself has taken several policies from all the insurance companies including that of his wife for a total sum of Rs. 1 crore 20 lakhs. Except two policies all the policies were taken in the year 2000. The following are the particulars of the policies.
| S.No. | Policy Number | Period | Sum insured | Issuing Office |
| National Insurance Company Ltd. | ||||
| 1 | 9600058/00 | 08/12/199 to 07/12/2K | 500000 | DO3, Hyd. |
| 2 | 9600291/99 | 12/01/2K to 11/01/01 | 100000 | BO, Ameerpet, Hyd |
| 3 | 8100109/99 | 15/01/2K to 14/01/01 | 200000 | BO, Ameerpet, Hyd |
| 4 | 8100084/00 | 07/07/2K to 06/07/01 | 600000 | BO-I, , Secbad |
| 5 | 8100047/00 | 10/07/2K - | 500000 | BO-II, Secbad |
| 6 | 8100054/00 | 14/07/2K to 13/07/01 | 600000 | BO, Patancheru |
| 7 | 8100027/00 | 26/07/2K to 25/07/01 | 700000 | DO-I, Hyd |
| 8 | 8100087/99 | 26/02/2K to 21/02/01 | 500000 | DO-II, Hyd |
| 9 | 8100043/00 | 700000 | BO, Chikadpally | |
| Total | 4400000 | |||
| United India Insurance Company Ltd. | ||||
| 10 | 41246 | 12/11/98 to 11/11/08 | 500000 | DAB, Hyd |
| 11 | 42/42020 | 07/07/00 to 06/07/01 | 1000000 | DO-II, Hyd |
| 12 | 42/02026 | 10/07/2K to 09/07/01 | 600000 | BO, Sanga Reddy |
| 13 | 42/42076 | 23/02/2K to 23/02/01 | 600000 | BO-State, Secbad |
| 14 | 42/44005 | 28/07/2K to 27/07/01 | 700000 | BO, Mahbubnagar |
| 15 | 42/00125 | 28/07/2K to 27/07/01 | 650000 | BO, Koti, Hyd. |
| Total | 4050000 | |||
| New India Assurance Company Ltd. | ||||
| 16 | 42/1598 | 28/01/2K to 27/01/01 | 1200000 | DO, Parishrambhavan |
| 17 | 42/52 | 07/07/2K to 06/07/01 | 750000 | DO-I, Secbad |
| 18 | 42/202 | 25/07/2K to 24/07/01 | 300000 | Org. DO, Liberty |
| 19 | 42/6 | 28/07/2K to 27/07/01 | 500000 | BO, Mahbubnagar |
| 20 | 42/14 | 28/07/2K to 27/07/01 | 500000 | DO, Mahbubnagar |
| Total | 3250000 | |||
| Oriental Insurance Company Ltd. | ||||
| 21 | 42/11/219 | 11/01/2K to 10/01/01 | 100000 | DO-I, Hyd |
| 22 | 42/70/004 | 06/07/2K to 05/07/01 | 200000 | DO, Nanded |
| Total | 300000 | |||
| Grand Total | 12000000 | |||
âBefore conclusion this court would like to record its opinion and observations that the result of this case shall have no impact, influence, reference and bearing on other cases, if any, pending against the accused in connection with insurance policies in any court or courts.â
The complainant did not make any claim even after disposal of the sessions case by 29.10.2004. The deceased was a government teacher, could not have taken policies for a huge sum of Rs. 120 lakhs. Therefore the Dist. Forum has no territorial as well as pecuniary jurisdiction, and therefore prayed for dismissal of the complaint with costs.
4) The complainant in proof of his case filed his affidavit evidence and got Exs. A1 to A12 marked while the insurance company filed Exs. B1 to B6.
5) The Dist. Forum after considering the evidence placed on record opined that the appellant ought to have paid the amount when he was acquitted in the sessions case, and in not settling the claim even after acquittal would amount to deficiency in service, and therefore directed the insurance company to pay Rs. 6 lakhs covered under the policy with interest @ 9% p.a., from the date of complaint till the date of realization together with compensation of Rs. 10,000/- towards mental agony and Rs. 1,000/- towards costs.
6) Aggrieved by the said decision, the insurance company preferred the appeal contending that the Dist. Forum did not appreciate either facts or law in correct perspective. It ought to have seen that the very Sessions Judge while acquitting the accused had categorically opined that the result of the sessions case would not enable the complainant to make claim under the insurance policies. There was suppression of material fact in regard to various policies taken. It is contrary to the terms of the policy. The suppression of earlier other policies would entail rejection of claim. The claim was barred by limitation. For the death that took place on 6.8.2000 he filed the complaint in the year 2010. He himself forged the signatures of his wife, and subsequently killed her and got the sessions case acquitted, and therefore he was not entitled to any amount as per Section 45 of the Insurance Act. The Dist. Forum had neither territorial jurisdiction or pecuniary jurisdiction, and therefore prayed that the complaint be dismissed.
7) During the course of hearing the appellant insurance company filed an application to receive certain documents by way of additional evidence viz., report from Truth Labs, investigation report submitted by M.S. Prasad and copy of judgement in C.C. No. 924/2002 on the file of XI Additional Chief Metropolitan Magistrate, Hyderabad where the complainant was sentenced to undergo imprisonment for having forged the signatures of his wife. They are assigned as Exs. B7 to B9 respectively.
8) The points that arise for consideration are:
I. Whether the assured had taken various policies and the said fact was suppressed at the time when the policy in question was taken?
II. Whether the complainant is entitled to the amount covered under the policy?
III. To what relief?
9) It is an undisputed fact that policy Ex. A1 issued for a sum of Rs. 6 lakhs covering the period from 14.7.2000 to 13.7.2001 stood in the name of Smt. Arifunnisa Begum. Undisputably, the deceased the wife of the complainant/respondent herein a government school teacher drawing a salary of Rs. 10,746/- subscribed a policy for Rs. 6 lakhs She had taken about eight polices apart from policy in question from National Insurance Company amounting to Rs. 44 lakhs within one year viz., from 8/12/1999 to 26/2/2000. She had also taken six policies from United India Insurance Company for an amount of Rs. 40,50,000/- covering the period from 12/11/1998 to 28/7/2000. It may be stated herein that she had also taken five more policies from the New India Assurance Company for an amount of Rs. 32,50,000/- covering the period from 28/1/2000 to 28/7/2000. Evidently when she had taken the policies she did not mention the earlier policies taken by her. She could not have paid the premia over the said policies from out of her salary. In all these policies the complainant her husband is the nominee. She died in suspicious circumstances on 6.8.2000. In fact the complainant has faced murder charge on the death of the assured his wife in S.C. No. 178/2002. The learned Sessions Judge mentioned:
 â in the investigation it was disclosed that the accused was a retired inspector of police and the deceased was working as a school teacher in Govt. Girls High School, Narayanpet of Mahaboobnagar Dist. The accused who is not happy with the deceased married 3rd wife namely Smt. Yavarunnisa Begum in 1982. The deceased was regularly sending an amount of Rs. 3,500/- from her salary to her husband/accused for maintenance, and expenditure of her daughter who was staying with him at Hyderabad. On 10.7.2000 the accused got personal accident policy for Rs. 6 lakhs from the United India Insurance Company Ltd., Sanga Reddy in the name of the deceased by submitting proposal form without knowledge of the deceased. He informed the deceased over phone on 5.8.2000 to come to Hyderabad from Narayanapet immediately. The deceased submitted leave application to the Head Master and left the school to go to Hyderabad on 6.8.2000 and reached the house of the accused at 11.00 a.m. On the same day i.e., on 6.8.2000 at about 19.30 hours the accused brought the deceased to the spot situated in the limits of Annaram village on his scooter bearing No. AP 28-H-400 on the pretext to go to Naraspur fro getting treatment for joint pains of the deceased. When they reached in between Annaram and Domadugu villages which is lonely place on Narsapur-Hyderabad road, the accused stopped his scooter and informed the deceased that they would go back to Hyderabad as the scooter is giving trouble and the deceased was returning back towards Annaram by walk. The accused also returning behind her with scooter. The accused suddenly started his scooter and dashed her from rear side, due to which she fell down on the road and sustained injuries. Then the accused picked up stones from the nearby place and attacked the deceased with stones to kill her with malafide intention to claim insurance amount of Rs. 1.8 crores from various personal accident policies of the deceased from different insurance companies. As a result the deceased sustained grievous injuries and died on 12.8.2000. Thus the accused committed offences punishable u/s 302 and 201 IPC.â
No doubt the accused was ultimately acquitted by the Sessions Judge. He was in two minds whether the death was accident or accused allegedly murdered for insurance amounts. The prosecution failed to establish or substantiate that the accused allegedly murdered with cogent and corroborating evidence. In view of the fact that he was acquitted, however he could not resist except stating:
âBefore conclusion this court would like to record its opinion and observations that the result of this case shall have no impact, influence, reference and bearing on other cases, if any, pending against the accused in connection with insurance policies in any court or courts.â
Obviously during the pendency of the complaint on the claim made by the complainant in regard to the policy issued by Oriental Insurance Company Ltd., it had appointed an investigator Mr. M. S. Prasad who after enquiry submitted his report Ex. B1 dt. 10.6.2010. He found that the complainant/husband of the deceased by contacting different insurance companies obtained nearly 23 policies from four subsidiary companies getting her insured for an amount of Rs. 1.21 crores. The Officers of the United India Insurance Company seems to have given a report to the police alleging that he forged the signatures of his wife, cheated the officers and got those policies basing on which cases were registered as Crime No. 9/2001, 22/2001, 19/2001 etc. He was convicted for a period of three years imprisonment and penalty of Rs. 10,000/-. It was opined that the signatures on the proposal forms do not belong to the assured his wife, they were all forged. Though copies of judgement were not filed before the Dist. Forum, during the course of hearing of the appeal, the appellant insurance company filed a copy of the judgement Ex. B9 in C.C. 942/2002. The learned XI Addl. Chief Metropolitan Magistrate, Secunderabad observed that âit is beyond the capacity of the deceased to obtain policies worth of Rs. 1.21 crores within a span of six months, who has got only very limited income as a teacher and even who could not place her Rs. 75,000/- savings with the accused during her life time and who saved the same and kept with her mother itself goes to show that the accused is the instrumental, and made diabolic plan, prepared evil designs, forged documents, used such forged documents for the purpose of cheating the insurance companies, knowingly and made false representation before various authorities for unlawful gain.â
10) The complainant contended that the observations in a criminal case are not binding and the Tribunals or the courts have to independently come to a conclusion basing on the record. Result of the case could only be taken into cognizance and not reasons for coming to such a conclusion. At the outset, we may state that rules of evidence of the Evidence Act or the procedure contemplated under Cr.P.C. have no application while dealing the cases under the Consumer Protection Act. The principles applicable are principles of natural justice, equity and good conscience etc. Be that as it may, when the assured admittedly did not inform the earlier policies that she had taken with the appellant insurance company or with other four insurance companies, a material suppression of the fact. The insurance company will collect the premium basing on the various factors viz., income, age, health condition, and other particulars of the assured. When the assured did not disclose the other policies, we reiterate that it amounts to suppression of material fact.
11) The National Insurance Company appellant sent five proposal submitted by the assured wife of the complainant to Truth Labs for comparing the signatures of the deceased with that of admitted signatures. Truth Labs after comparing the signatures opined that the signatures were fabricated, and also appointed an investigator subsequent to the order of the Dist. Forum and the surveyor submitted his report Ex. B8 dt. 15.1.2011. Since they are subsequent to the enquiry, and no opportunity was given to the complainant to traverse the said opinion and report of hand-writing expert being opinionated, we do not take into cognizance of those reports.
i) The Honble Supreme Court in Mithoolal Nayak Vs. LIC of India â AIR 1962 SC 814 has held that an insurance policy is an agreement in utmost good faith between the insurer and insured and any breach of this agreement by suppressing material facts on the part of insured would result in repudiation of the claim by the insurer
ii) The Honble Apex Court in the case Life Insurance Corporation of Inida and Another, Vs. Asha Goel (Smt) and another reported in (2001) 2 SCC page 160 has held that:Â Â Â âThe duty to disclose material fact continues right up to the conclusion of the contract and also implies any material alteration in the character of the risk which may take place between the proposal and its acceptance. If there are any mis-statements or suppression of material facts, the policy can be called into question. For determination of the question whether there has been suppression of any material fact it may be necessary to also examine whether the suppression relates to a fact which is in the exclusive knowledge of the person intending to take the policy and it could not be ascertained by reasonable enquiry by a prudent person (para 12).
When the material particulars disclosed by the assured were found to be suppressed, the insurance companies are within their right to repudiate the claims.
iii) Â In Satwant Kaur Sandhu Vs. New India Assurance Company Limited [(2009) 8 SCC 316], the Honble Apex Court has held that insurance is a contract based on complete good faith and any suppression of material fact would be a breach of such contract and the insurer would be justified in repudiating the claim once such suppression is established.
12) To sum up the assured, wife of the complainant had suppressed the various policies taken by her. It amounts to suppression of material fact. The policies worth Rs. 1.21 crores stood in the name of the deceased for which the complainant is the beneficiary. She is a government school teacher hardly drawing a salary of Rs. 10,000/- per month. In the light of the above, we are of the opinion that the complainant is not entitled to the amount covered under the policy.
13) In the result the appeal is allowed setting aside the order of the Dist. Forum. Consequently the complaint is dismissed with costs computed at Rs. 2,000/-. Time for compliance four weeks.