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IN

NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION

NEW DELHI

REVISION PETITION NO. 3858 OF 2017

(Against the Order dated 08/09/2017 in Appeal No. 949/2016 of the State Commission
Maharashtra)
1. ICICI PRUDENTIAL LIFE INSURANCE CO. LTD.
UPPER BASEMENT UNIT NO. 1A, GR FLOOR, UNIT
2A, RAHEJA TIPCO PLAZA, RANI SATI MARG,
MALAD EAST
MUMBAI-400097
MAHARAHSTRA ...........Petitioner(s)
Versus
1. DATTATREY BHIVSAN GUJAR
R/O. A-5 SAGAR HOUSING SOCIETY OPP. MEGNA
THEATRE, P.O. TAL ALIBAUG,
DISTRICT-RAIGARD
MAHARAHSTRA ...........Respondent(s)

BEFORE:
HON'BLE MR. DR. S.M. KANTIKAR,PRESIDING MEMBER
HON'BLE MR. DINESH SINGH,MEMBER

For the Petitioner : Mr. B.S. Banthia , Advocate

For the Respondent : Mr. Akash Gupta , Advocate

Dated : 14 Jun 2019

ORDER

DR. S. M. KANTIKAR, PRESIDING MEMBER

1. Heard the learned counsel for both the parties and perused the material on record.

2. The dispute relates to repudiation of the complainant’s insurance claim, made under the
insurance contract entered into between the Insurance Co. and the complainant.

3. The District Forum had heard both sides, appraised the evidence, and, vide its Order dated
31.10.2015, partially admitted the complaint:

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RATIONALE

5- Issue Nos. 1 to 3 – The Opposite Party has raised objection to the jurisdiction of the
Forum and given the reference of Hon. Supreme Court in case of Ravneet Singh Bagga v/s
KLM Royal Dutch Airlines [(2000) 1 SCC 66] has propounded upon the issue of
deficiency in service and has said that only on intentionally providing deficient service the
issue of deficient service is proved. In the present complaint the Opposite Party has not,
while providing service to the Complainant, intentionally provided deficient service to the
Complainant and therefore the present complaint should not be heard in this Forum. Also
they have referenced that the Hon. National Forum has propounded the legal principle in
the case of Kishore Chandrakant Rathod v/s ICICI Prudential Life Insurance Co. Ltd. and
Others (review petition no. 3390/2013) that the Complainant is an educated person and has
fully read the terms and conditions of the contract and then taken insurance cover, and for
any breach of these conditions resulting in the Opposite Party rejecting the insurance claim
the complaint cannot be conducted in front of the Forum. The Opposite Party has said that
therefore the Forum has no jurisdiction to conduct the hearing on this complaint. It is
proved that after the insurance contract between the Opposite Party and the Complainant,
the complainant has not given in writing to the Opposite Party within 15 days of the
contract any intimation to cancel the said policy. After the documents submitted by the
Complainant to the opposite Party were scrutinized by the specialists appointed by the
Opposite Party it was diagnosed that the Complainant had diabetes and the Opposite Party
came to know that treatment for the same had been taken and it was verified from the
documents submitted by the Complainant but it was established that the Complainant had
not disclosed this information to the Opposite Party voluntarily. Therefore it was proved
that the complainant had intentionally not given this information to the Opposite Party - - -
therefore the Opposite Party has repudiated the Complainant’s insurance claim under
section 45 of the Insurance Act 1938, as also under the terms mentioned in condition 5 B
(i) of the contract. Therefore the Opposite Party have sent a letter to the Complainant dated
21/12/2012 informing him about the insurance claim being rejected. Since the complainant
has breached the terms and conditions of the insurance contract, the Opposite Party has
repudiated his claim justly and informed him about it and therefore the Forum does not
have jurisdiction to conduct a hearing on the present complaint. Also the Complainant had
deliberately withheld from the Opposite Party the information about the Complainant
having been diagnosed with diabetes , thus the Opposite Party has no legal obligation to
fulfill the insurance claim submitted by the Complainant and so the Opposite Party has
committed no deficiency in service to the Complainant and therefore the present complaint
should be rejected with expenses under section 26 of the Consumer Protection Act based
on the available documents. After stating this, as held by Hon. Supreme Court in the
judgments in the cases of United India Insurance Co. Ltd. v/s harchand Rai Chand Rai
Chandalal I (2003) CPJ 393 and Vikram Greentech (I) Ltd. & Another v/s New India
Assurance Co. Ltd. , II (2009) CPJ 34 and also Export Credit Guarantee Corporation of
India Ltd. v/s Garg Sons International [2013 (I) Scale 410 ) ] it was held that breach of
terms and conditions of the insurance contract is sufficient reason to repudiate the
insurance claim and similarly in the present complaint also the Opposite Party has
repudiated the insurance claim on valid reasons.

The Opposite Party has repudiated the Complainant’s claim based mainly on the breach of
terms and conditions of the insurance contract. On reading the terms and conditions of the
insurance contract, it is clear that the said insurance contract has been executed relative to

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the personal information provided by the Complainant and verification thereof by the
Opposite Party with the Complainant before the contract was executed. In the opinion of
the Opposite Party, the Complainant deliberately withheld information about his diabetes
and its continuing treatment, thereby not following the terms and conditions of the
insurance contract, especially condition no. 5 B (I) and therefore the insurance contract is
rendered invalid from the date of its inception. Therefore according to the Indian Contracts
Act at the time of taking the insurance cover the Complainant has agreed to certain terms
and conditions and then breached them by not disclosing the information about his pre-
existing illness thereby hindering the basic validity of the insurance contract. The Opposite
Party have stated that they have repudiated the insurance claim on the basis of the
deliberate withholding of information by the Complainant which is a just reason
invalidating the insurance contract and therefore the Opposite Party have not provided
deficient service to the Complainant by repudiating the insurance claim. On going through
the insurance claim submitted by the Complainant to the opposite Party, the information
about the Complainant having been diagnosed with diabetes is not entered. Also before
taking the insurance cover the Complainant has undergone complete medical check – up
by the specialists of the Opposite Party and after this the insurance contract has come into
existence. It is proved by the Complainant’s statements that in the tests done by the
Opposite Party’s specialists it was found that the Complainant had no illnesses. Nearly 4
years after the insurance coverage was provided by the Opposite Party to the Complainant
he felt the stomach pain for the first time. He has taken the treatment and then duly filed
the claim with the Opposite Party. As per the Insurance Act 1938, section 45 it is clearly
provided that after expiry of two years after the insurance contract commences the
insurance services providing insurance company cannot question the untrue statements
related to the insurance contract ; or cannot deny the stated services and also because the
Complainant is an elderly person and as such has no reason to withhold any information,
therefore it is stated that the insurance claim submitted by the Complainant with the
Opposite Party is a valid claim. On a close scrutiny of the Complainant’s insurance claim,
it can be seen that as per the terms and conditions only the documents related to the
Complainant having taken treatment for diabetes have been submitted by the Opposite
Party along with the evidential affidavit. That this was not disclosed by the Complainant in
the insurance contract with the Opposite Party is proved by the arguments presented in the
opposite Party’s evidential affidavit. An insurance contract is entered into on the basis of
true information being given by both the parties. Although it has been proved that all the
various terms and conditions of the Opposite Party were not adhered to in the present
complaint, the Hon. Supreme Court has stated in the judgment of the case of Amlendu
Sahu v/s Oriental Insurance Co. Ltd., 11 (2010) CPJ 9 (SC) that it is just for the Opposite
Party to pay to the Complainant 75 % of the insurance claim amount while repudiating an
insurance claim for technical reasons. According to this judicial principle and also the
Complainant having undergone medical tests by the specialists of the Opposite Party and
still the information about the complainant’s diabetes not being disclosed in those tests ,
the Forum is of the opinion that it is just and fair for the Opposite Party to pay to the
Complainant 75 % of the insurance claim amount. It is the opinion of this Forum that by
repudiating the claim for some mere technical reasons as also by raising objections to the
jurisdiction of this Forum and by stating in their written statement that the Complainant
had deliberately withheld information about his diabetes and therefore paying the claim is
not just and fair and repudiating the claim, the Opposite Party have provided deficient
services to the Complainant. The fact that the Opposite Party has caused financial loss to
the Complainant by repudiating his insurance claim is clear from the date of repudiation of
the claim and also the date of Final Order in this Complaint.

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The Complainant has demanded Rs. 2,00,000/- in total from the Opposite Party for
compensation for financial loss , mental hardship, physical and financial hardship and
expenses for the complaint. Also the expenses for hospitalization and medicines and
treatment of Rs. 5,53,375/- totaling Rs. 7,53,375/- is demanded from the Opposite Party .
But in the opinion of the Forum, the Opposite Party needs to pay to the Complainant Rs.
1,00,000/- towards financial loss etc. Also as per the judicial principle propounded by the
Hon. Supreme Court in the case of Amlendu Sahu v/s Oriental Insurance Co. Ltd., 11
(2010) CPJ 9 (SC) even though the Opposite Party has repudiated the Complainant’s
insurance claim for technical reasons , it is the opinion of this Forum that in the interest of
equity and justice 75 % of the insurance claim amount Rs. 5,53,375 /- i.e. Rs. 4,15,030 /-
must be paid by the Opposite Party to the Complainant. Even though the Opposite Party
has requested that this complaint should be rejected with expenses under section 26 of the
Consumer Protection Act, they have not provided to the Forum any evidence in support of
this objection. Therefore this objection of the Opposite Party is not valid. Therefore, the
answer to Issue nos. 1 to 3 is in the affirmative.

6- From the above conclusions the following order is being passed.

FINAL ORDER

1. The complaint no. 982/2014 is partially admitted.

2. It is declared that the Opposite Party has provided deficient services to the Complainant by
repudiating the Complainant’s insurance reimbursement claim.

3. The Opposite Party is ordered to pay to the Complainant within 60 days of receiving this
order 75 % of the insurance reimbursement claim amount i.e Rs. 4,15,030 /- (Rupees Four
Lakh Fifteen Thousand Thirty Only) as described in the conclusion above.

4. If the opposite Party does not comply with paragraph 3 above within the time frame
mentioned , then the Opposite Party must pay 12 % p.a interest on the insurance claim
amount Rs. 4,15,030 /- (Rupees Four Lakh Fifteen Thousand Thirty Only) from 21/12/2012
till the payment of the complete amount to the Complainant.

5. The Opposite Party must pay to the Complainant a total of Rs. 1,00,000/- towards expenses
, mental hardship , financial and physical hardship within 60 days of the receipt of this
order.

6. True copies of the judgement should be sent to both the parties.

(paras 5 and 6 the District Forum’s Order)

(as per translated copy furnished by the revision petitioner)

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4. The opposite party Insurance Co. appealed in the State Commission. The State
Commission had heard both sides, appraised the evidence, and, vide its Order dated 8.9.2017,
dismissed the appeal:

[12] On perusal of order passed by the Ld. District Forum it appears that the Ld. District
Forum has considered that the claim of complainant cannot be rejected on technical
grounds and allowed 75 % claim of complainant on non- standard basis, on the basis of
ruling relied on by the complainant. We are of the opinion that when there is no evidence
on record that the complainant had deliberately concealed facts about medical health at the
time of obtaining policy from the opposite party, Complainant is entitled to get the
hospital charges from the opposite party. We are also of opinion that the view taken by the
Ld. District Forum that the claim of complainant cannot be rejected on the technical
ground and granted 75 % claim of complainant on non standard basis along with
compensation, appears to be legal and correct. Under such circumstances, we are of the
opinion that the appeal is liable to be dismissed and order passed by the Ld. District Forum
is to be confirmed. Hence, we proceed to pass the following order-

ORDER

1] Appeal is hereby dismissed with costs.

2] Impugned Order dated 31/10/2015 passed by the Ld. Raigad District Consumer
Disputes Redressal Forum ,Alibaug in consumer complaint No. 982 of 2014 is hereby
confirmed.

3] Appellant is directed to pay costs of appeal in the sum of Rs. 2,000/- [Rupees Two
Thousand only] to the Respondent/ complainant.

(para12 of the State Commission’s Order)

5. The opposite party Insurance Co. has filed the instant revision petition under section 21 (b)
of the Act 1986 against the said Order dated 8.9.2017 of the State Commission.

6. We find the Order dated 8.9.2017 of the State Commission to be well-appraised and
well-reasoned. The State Commission concurred with the District Forum in its findings of
deficiency in service. Within the meaning and scope of section 21(b), we find no grave error in
appreciating the evidence by the two fora below, as may cause to require re-appreciation of the
evidence in revision. And, on the face of it, we find no jurisdictional error, or a legal principle
ignored, or miscarriage of justice.

7. We uphold and affirm the award made by the two fora below in their concurrent findings
of deficiency in service. The award of the District Forum shall be made good by the opposite
party Insurance Co. within four weeks of the pronouncement of this Order.

8. In addition, however, we further note that it is an admitted fact that the opposite party
Insurance Co. had issued “ICICI-Pru Hospital Care Policy” in 2008 and the complainant was
paying the premium regularly. The complainant had no illness during 2008 to August 2012, but,
due to abdominal pain, he got admitted in Bombay Hospital on 18.09.2012, wherein he was

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diagnosed as suffering from renal (kidney) ailments. He underwent dialysis, and subsequently
kidney transplant was performed. The opposite party Insurance Co. repudiated the insurance claim
for hospitalization expenses of Rs. 5,53,375/-. It was repudiated on the ground of non-disclosure
of pre-existing medical condition by the complainant at the time of filling the proposal form. The
proposal form was filled in the year 2008 (on 29.07.2008). The insured incurred hospitalization
charges in the year 2012, and filed his insurance reimbursement claim with the opposite party
Insurance Co. However, the opposite party Insurance Co. repudiated the claim by relying
principally on one certificate (ext. P-2) issued by one Dr. Rajendra G. Chandorkar which states
that Mr. Dattatrey (the insured) was a known patient of diabetes and hypertension for the last 10
years. The verbatim of the certificate is reproduced as under:

“This is to certify that Mr. Dattatray B. Gurjar is a regular pt. of mine and regularly comes
for follow up regarding minor illness like cold / cough and fever. He is a known pt. of
Diabetes & Hypertension, since last 10 years.”

9. The opposite party Insurance Co. relied principally on this one certificate issued by this
one Dr. Chandorkar (as mentioned in para 8). It is pertinent to note that the said Dr. Chandorkar is
a pediatrician. He is neither a physician, nor an endocrinologist, to certify a person as a ‘diabetic
and hypertensive for past 10 years’. Moreover, nothing is on record that the said Dr. Chandorkar
has either examined or treated the complainant for diabetes or hypertension in the past 10 years.
Ex facie , a suspicious medical certificate was issued. It is not viewed favourably. It prima facie
amounts to professional misconduct under the Code of Medical Ethics Regulation, 2002 of the
Medical Council of India.

The medical record of Bombay Hospital does not , explicitly and categorically , confirm that the
complainant was diabetic and hypertensive prior to 2008. Logically, and medically, time or onset
of diabetes and / or hypertension cannot be accurately predicted. The complainant could possibly
have started suffering from diabetes and / or hypertension subsequent to the year 2008, and it
cannot be anyhow averred, on the basis of an ex facie suspicious certificate, that he was suffering
from the same prior to 2018.

10. We would not like to turn a blind eye on the issuance of the ex facie suspicious medical
certificate by the said Dr. Rajendra G. Chandorkar to unduly help the opposite party Insurance Co.
in taking its principal ground for repudiation of the insurance claim. Issuance of such medical
certificate is unethical and amounts to professional misconduct, which needs suitable action from
the concerned professional regulatory body. To check such unethical medical practices we, thus,
direct the Registrar of this Commission to refer this matter to the Maharashtra Medical Council,
Mumbai, for the appropriate necessary action against Dr. Rajendra G. Chandorkar, as per the
Council’s rules and wisdom.

11. Further, we note that the act of the opposite party Insurance Co. in obtaining (by whatever
means and in whichever manner) such suspicious certificate in such facts and circumstances and
principally using such certificate to repudiate the insurance claim is an unfair and deceptive act
and amounts to unfair trade practice within the meaning of section 2(1)(r) of the Act 1986. For
this, in addition to the award made by the two fora below in respect of deficiency in service
(which has been upheld and affirmed by us), the opposite party Insurance Co. is put to stern
advice of caution in respect of unfair trade practice through imposition of cost of Rs. 5 lakh to be
deposited in the Consumer Legal Aid Account of the District Forum, within four weeks of the
pronouncement of this Order.

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12. The revision petition of the opposite party Insurance Co. is dismissed, with directions as
above (paras 7, 10 and 11).

13. Needless to add that the District Forum shall undertake execution as per the law.

14. A copy each of this Order be sent to the District Forum and to the complainant within ten
days by the Registry.

A copy each of this order be sent to the Maharashtra Medical Council, Mumbai and be placed
before the Registrar of this Commission within ten days by the Registry.

......................
DR. S.M. KANTIKAR
PRESIDING MEMBER
......................
DINESH SINGH
MEMBER

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