NATIONAL INSURANCE CO LTD Vs. THEEGALA LAXMI

JUDGEMENT

(1.) The National Insurance Co. Ltd. (Petitioner herein) has filed the present revision petition against the order of the State Consumer Disputes Redressal Commission, Andhra Pradesh (hereinafter referred to as the 'State Commission') in Appeal No. 1002/2003 where in Theegala Laxmi and Others were Respondents. In her complaint before the District Forum, Respondent/complainant had contended that her late husband (here in after referred to as the 'insuree') during his life time had joined the Chakra Deposit Scheme of the Petitioner/Insurance Company and had paid a sum of Rs. 5,000 as well as 4 instalments under the said Scheme. As per the conditions of the above Scheme, if the deposit holder (insuree) dies an accidental death, Petitioner/Insurance Company would be liable to pay accidental benefit of Rs. 1 lakh. The insuree died on 4.6.1996 in an encounter which was an accidental death. Respondent, therefore, approached Petitioner/ Insurance Company to pay her the amount of Rs. 1 lakh due under the Chakra Deposit Scheme but despite legal notice, there was no response from Petitioner/Insurance Company. Aggrieved by this, Respondent filed a complaint before the District Forum and requested that Petitioner/Insurance Company be directed to pay her Rs. 1 lakh as admissible under the Scheme, Rs. 10,000 for mental agony and Rs. 1,000 as litigation cost with interest @ 18% per annum from the date of filing of the complaint.

(2.) The Petitioner/Insurance Company while admitting that the Respondent's husband had joined the Chakra Deposit Scheme stated that the claim was rightly repudiated because the death of the insuree was not accidental in nature since he did not die due to accidental firing by the police party. As per the crime records, the insuree was a member of an organization (CPI ML PWG) which is acting against the State Government and Government of India by indulging in violent unlawful activities and the insuree was killed in an encounter in exchange of fire between him and the police. Since the insuree participated in the said unlawful act which knowingly endangered his life, as such the claim is not covered under the insurance policy which states that the Company shall not be liable under this policy for any claim "arising or resulting from the insured person committing any breach of law with criminal intent".

(3.) The District Forum after hearing both parties allowed the complaint by inter alia observing that no credible evidence had been filed except some police records to show that the deceased was an extremist indulging in illegal activities and that he was consequently killed by the police in an encounter and his death was thus not an accidental death. Petitioner/Insurance Company has also not denied that insuree was a member of the Chakra Deposit Scheme nor was it their contention that insuree had not paid the premium amount towards the said Scheme. The District Forum, therefore, directed the Petitioner/Insurance Company to pay the Respondent Rs. 1 lakh on account of accidental death of her husband with interest @ 9% per annum from the date of filing of the complaint till realization along with litigation cost of Rs. 1,000 within one month from the date of receipt of the order.