NASEEM BANO Vs. L I C OF INDIA

JUDGEMENT

(1.) This appeal by the plaintiffs is against the judgment and decree dated 29.10.1993 passed by the V Additional District Judge, Indore in Civil Suit No. 142B of 1986. By the impugned judgment and decree, the suit preferred by the plaintiffs was dismissed and it was held that the plaintiffs are not entitled to recover any amount either from respondent No.1 or from respondent Nos. 2 and 3.

(2.) Facts necessary for the disposal of this appeal lie in a narrow compass. One Abdul Gaffar, an employee of respondent Nos. 2 and 3, took out an insurance policy on 28.3.1984 under the 'Salary Savings Scheme' floated by L.I.C. respondent No. 1. He was allotted policy No. S/57622245 and the monthly premium was fixed at Rs. 59.10. The first two premiums were paid by Abdul Gaffar. Under the insurance policy, the amount of premium was to be deducted by the M.P.S.R.T.C. from the monthly salary of Abdul Gaffar and remitted by it to L.I.C. under the authorisation issued by Abdul Gaffar in favour of the Depot Manager of the M.P.S.R.T.C. Abdul Gaffar died on 2.8.1984. Appellant No. 1 Naseem Bano, the widow of Abdul Gaffar and nominee under the policy, informed L.I.C. of the death of her husband and requested for the payment of amount due under the policy. L.I.C. disclaimed any liability for payment under the policy as the instalments of the premium from May, 1984 were not received by it. L.I.C., therefore, repudiated the claim of Naseem Bano. L.I.C. claimed that since the default has been committed for payment of premium, the policy taken out by Abdul Gaffar had lapsed. Similarly, respondent Nos. 2 and 3 disowned any liability, which compelled the plaintiffs, who are the legal representatives of deceased Abdul Gaffar, to institute the suit for recovery of the sum assured under the policy together with interests as mentioned hereinabove.

(3.) Plaintiff's claim was resisted by the respondents herein. L.I.C., respondent No. 1, in its written statement admitted that Abdul Gaffar had taken out a life insurance policy on 28.3.1984 under the 'Salary Savings Scheme'. It was also not disputed by L.I.C. that Abdul Gaffar paid the initial premium amount and also had issued the authorisation in favour of Depot Manager to deduct the monthly instalment of premium from his monthly salary. Nomination of appellant No. 1 to receive the sum assured under the policy was also not disputed. It was further not disputed that Abdul Gaffar died on 2.8.1984 and intimation in writing in this regard was given to by appellant No. 1 on 7.8.1984 while demanding the payment of the sum assured. L.I.C. repudiated the claim on the ground that as respondent Nos. 2 and 3 failed to deduct and remit to it the monthly instalments from the salary of May to June 1984, therefore, policy had lapsed. It was alleged that no efforts were made by late Abdul Gaffar to ensure the remittance of premium by his employer therefore he alone was responsible for the consequences ensuing from such default. It was obligatory on the part of Abdul Gaffar to pay the instalments therefore also L.I.C. is discharged from its liability to make any payment. Respondent Nos. 2 and 3 in their written statement denied any liability to pay the amount inasmuch as they specifically denied that Abdul Gaffar had taken out any insurance policy. They also denied that any authorisation was given by Abdul Gaffar to the Depot Manager for deducting the monthly premium from the salary. With these pleadings the parties went to trial. The following issues were struck by the trial court: