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The Supreme Court of India ruled on the appeal by Oriental Insurance Company Ltd. against a decision by the National Consumer Disputes Redressal Commission, which ordered the company to pay Rs. 5 lakhs to Munimahesh Patel for a claim related to his wife's accidental death. The Court found that the Commission improperly adjudicated a complex factual dispute regarding the insured's occupation, which should have been resolved in a proper court. Consequently, the Supreme Court allowed the appeal, reinstating the State Commission's dismissal of the complaint.

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22 views2 pages

Supreme Court of India Page 1 of 2

The Supreme Court of India ruled on the appeal by Oriental Insurance Company Ltd. against a decision by the National Consumer Disputes Redressal Commission, which ordered the company to pay Rs. 5 lakhs to Munimahesh Patel for a claim related to his wife's accidental death. The Court found that the Commission improperly adjudicated a complex factual dispute regarding the insured's occupation, which should have been resolved in a proper court. Consequently, the Supreme Court allowed the appeal, reinstating the State Commission's dismissal of the complaint.

Uploaded by

akshay
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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http://JUDIS.NIC.

IN SUPREME COURT OF INDIA Page 1 of 2

CASE NO.:
Appeal (civil) 4091 of 2006

PETITIONER:
Oriental Insurance Company Ltd.

RESPONDENT:
Munimahesh Patel

DATE OF JUDGMENT: 12/09/2006

BENCH:
ARIJIT PASAYAT & LOKESHWAR SINGH PANTA

JUDGMENT:
J U D G M E N T
(Arising out of SLP (C) No. 19538 of 2004)

ARIJIT PASAYAT, J.

Leave granted.

Appellant calls in question legality of the judgment


rendered by the National Consumer Disputes Redressal
Commission, New Delhi (in short the ’Commission’). The
Commission upset the order of the State Commission and held
that the appellant was liable to pay to the respondent
(hereinafter referred to as the ’complainant’) a sum of Rs.5
lakhs together with interest @ 6% p.a. from the date of the
complaint.

Factual position in a nutshell is essentially as follows:

Smt. Lalitha Devi Patel wife of the complainant had


obtained a Janata Personal Accident Policy for a sum of Rs.5
lakh in August, 1998, for which a premium was paid and
accepted and the policy was issued. The insured died on
account of an accident by way of falling into a well and
drowning. FIR was lodged, autopsy was performed and
appellant was informed. Various documents were also
furnished claiming payment in spite of the policy. When the
appellant\026Company did not settle the claim, a complaint came
to be filed before the Madhya Pradesh State Consumer
Redressal Commission, Bhopal (in short ’the State
Commission’) alleging deficiency in service on the part of the
appellant. State Commission after hearing the parties
dismissed the complaint leaving the complainant to take
appropriate proceeding for establishing his claim and for
seeking the reliefs in the court of competent jurisdiction.
Aggrieved by this order, appeal was filed before the
Commission.

After hearing the parties, the Commission passed order


dated 2.5.2002 allowing the complaint and setting aside the
order of the State Commission. Since this order had been
passed ex-parte against respondent, on an application moved
by the respondent the earlier order was recalled and both the
parties were given opportunity to present their case. It
directed payment of the amount as noted above.

The Commission accepted that there was no dispute


regarding genuineness of the policy. But it noted that there
was dispute about disclosure made in the proposal form and
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 2 of 2
the information given. It accepted that she was not employed
as stated in the proposal form. Commission did not consider
it necessary to go into that question and held that though
there may have been some information given which has no
relation with the actual state of affairs, yet the factum of the
accident resulting in death and policy was not in dispute and,
therefore, the claim of the complainant was to be allowed.

In support of the appeal, learned counsel for the


appellant submitted that the principle of good faith which is
inherent in insurance was not there. The complainant was
guilty of making false statement in the proposal form.

Learned counsel for the appellant has brought on record


a copy of the proposal form in which it is mentioned that the
respondent’s wife i.e. the insured was a teacher. This is at
variance with the actual copy of another form has also been
produced and shows that the respondent accepted that she
was a house wife. The State Commission, therefore, dismissed
the appeal in view of the disputed factual position and directed
the complainant-respondent to seek remedy, if any, available
in any other appropriate forum. Learned counsel for the
appellant further submitted that when there is suppression of
material fact which is relevant to the coverage of policy, the
respondent was not entitled to any relief and the Commission
had accepted that she was not a teacher. He, therefore,
contended that the respondent was not entitled to any relief.

Learned counsel for the respondent on the other hand


submitted that no interference is called with the decision of
the Commission. He also stated that no such proposal form as
claimed by the appellant was submitted.

The Commission noted that the specific stand of the


appellant was that there was mis-declaration in the proposal
form and the false claim that the respondent’s wife was a
teacher which as now appears is not the correct position. It
also accepted that she was really not a teacher.

Proceedings before the Commission are essentially


summary in nature and adjudication of issues which involve
disputed factual questions should not be adjudicated. It is to
be noted that Commission accepted that insured was not a
teacher. Complainant raised dispute about genuineness of the
documents (i.e. proposal forms) produced by the appellant.

The Commission having accepted that there was wrong


declaration of the nature of occupation of the person insured,
should not have granted the relief in the manner done.

The nature of the proceedings before the Commission as


noted above, are essentially in summary nature. The factual
position was required to be established by documents.
Commission was required to examine whether in view of the
disputed facts it would exercise the jurisdiction. The State
Commission was right in its view that the complex factual
position requires that the matter should be examined by an
appropriate Court of Law and not by the Commission.

Above being the position, the Commission was not


justified to deal with the matter in the manner as was done.
In our view, the directions of the State Commission were more
appropriate keeping in line with the nature of dispute.
Accordingly, the appeal is allowed but with no order as to
costs.

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