1 2026:CGHC:20024 Order Reserved on : 15/01/2026 Order Delivered on : 29/04/2026 Order (full) uploaded on: 29/04/2026 NAFR HIGH COURT OF CHHATTISGARH AT BILASPUR WPC No. 4259 of 2019 1 - General Manager/chief Executive Officer (C.E.O.) Bajaj Allianz Life Insurance Company Limited, G.E. Plaza, Airport Road, Yerwada, Pune, Maharashtra-411006. Represented Through Authorized Representative Mr. Balram Kumar Patwa, S/o Dudheshwar Prasad, Aged About 28 Years, Posted As Zonal Manager Legal And Compliance Of Bajaj Allianz Life Insurance Company Limited Branch Office At Rama Magneto Mall Office No. 414, 4th Floor, Srikant Verma Marg, Deen Dayal Upadhyay Chowk, Bilaspur, Chhattigarh. 495001 2 - Branch Manager Bajaj Allianz Life Insurance Company Limited, First Floor, Subhash Chandra Chowk, Kumhar Para, Kewaramund Ward Jagdalpur, District Bastar, Chhattisgarh. Represented Through Authorized Representative Mr. Balram Kumar Patwa, S/o Dudheshwar Prasad, Aged About 28 Years, Posted As Zonal Manager Legal And Compliance Of Bajaj Allianz Life Insurance Company Limited Branch Office At Rama Magneto Mall Office No. 414, 4th Floor, Srikant Verma Marg, Deen Dayal Upadhyay Chowk, Bilaspur, Chhattigarh. 495001 ... Petitioner(s) versus 2 1 - Ahmed Hussain (Died) Through Legal Heir As Per Hon’ble Court Order Dated 27-11-2024. 1.1 - Smt. Apsara Qureshi W/o Mohd. Alim Qureshi Aged About 42 Years R/o H-9, Sector-1, Awanti Vihar, Police Station- Telibandha, Ravigram, Raipur, District Raipur, Chhattisgarh ... Respondent(s) For Petitioner(s) : Shri Ravi Bhagat, Advocate For Respondent(s) : Shri G.M.Hasan and Shri Galib Dwivedi, Advocates ({Hon’ble Shri Justice Sachin Singh Rajput}) C A V Order 1. This petition has been filed by the petitioners assailing legality, correctness and judicial propriety of the award dated 29/09/2018 passed in case No.83/2014 by the Permanent Lok Adalat (Public Utility Services) Jagdalpur, District- Bastar (CG) [for short ‘PLA’]. 2. By the impugned award, learned PLA ordered to pay Rs.4,16,226/- with interest @ 8% from 13/12/2013 till recovery in favour of the respondent and against the petitioner. The writ petition was filed against original respondent namely Ahmed Hussain who was the applicant before the PLA. During pendency of this writ petition, he passed away and his legal representative is substituted on record. An application under Section 22 (1) of Legal Services Authorities Act, 1987 (for short ‘the Act of 1987’) was filed by the 3 original respondent – Ahmed Hussain against the petitioners before the learned PLA. 3. Facts which emerges from the record are that Late Smt. Ayesha Hussain was the wife of the deceased-original respondent Ahmed Hussain. An insurance policy bearing No.0187786346 was issued in favour of Lt. Ayesha Hussain by the petitioners. It is further pleaded that the wife of original respondent was allured by the agent of the petitioners that she would be paid Rs.55 lakhs after completion of tenure of the policy or after her death. Rs.50,000/- as premium was paid by Smt. Ayesha Hussain and original respondent was the nominee in the said policy. Smt. Ayesha Hussain died on 26/03/2012 in Maharani Hospital, Jagdalpur. After her death, in order to receive the insurance amount, deceased respondent contacted the petitioners and submitted different documents in the office. However, the same was not paid to him, for which he had to visit Jagdalpur on many occasions as he was residing at Bhawanipatnam, Orissa after the death of his wife. Though the deceased respondent was entitled to Rs.5 lakhs, only Rs.83,774/- was deposited in his bank account and thus claimed Rs.5 lakhs insurance amount and Rs.2 lakhs towards mental agony and Rs.50,000/- towards other expenses. 4. The application was resisted by the petitioners herein inter alia denying averments of the application. It has been specifically pleaded that Smt. Ayesha Hussain died of Carcinoma Ovary (a type of Cancer). Before purchase of the insurance policy, in 4 paragraph 14 of the proposal form, this fact was suppressed by her. It has been further pleaded that on investigation, it is revealed that she was suffering from Cancer and by suppressing about the serious and life threatening disease, the policy was purchased. Thus, respondent No.1 was not entitled for any relief as claimed. 5. On the basis of above broad pleadings, learned PLA framed 3 issues which are quoted herein below - 1. Whether the applicant is entitled to receive the insurance money along with interest from the non-applicant / insurance company after the death of his wife Smt. Ayesha Hussain? 2. Whether the applicant is entitled to receive Rs.2,00,000/- towards mental agony and Rs.50,000/- as other expenses from the non-applicant/insurance company? 3. Assistance and litigation expenses? 6. Respective parties led their evidence and proved their pleadings. By the impugned award, issue no.1 was held to be proved. Issue No.2 was held to be not proved and learned PLA ordered that the amount which is mentioned in the 1st paragraph of the order. 7. Learned counsel for the petitioners vehemently argued that the deceased Smt. Ayesha Hussain in whose name the insurance policy was issued was suffering from Carcinoma Ovary (a type of Cancer) before the policy was issued in her name. He submits that in the proposal form, particularly in column 14, wherein it has been mentioned as to whether the person is suffering from Cancer or any other disease, she made a deliberate assertion that she is 5 not suffering from any disease. Reading from the proposal form, he submits that all the averments made in the proposal form is believed to be true by the proposer i.e. Smt. Ayesha Hussain and as such, serious and life threatening disease which the proposer was suffering has been suppressed in order to obtain policy. He further submits that in column No.24 of the proposal form, the petitioner company had acted with utmost good faith on the verification and confirmation of the proposal and issued the insurance policy. As false declaration was given by the proposer Ayesha Hussain, the repudiation of claim of original petitioner on account of death of his wife Smt. Ayesha Hussain cannot be said to be illegal. He further submits that the case in hand falls within 3 years limitation as prescribed under Section 45 of the Insurance Act, 1939 and as such the repudiation is well founded. He further submits that the insurance policy issued to the deceased Smt. Ayesha Hussain was market claimed policy and thus the current value of Rs.83774/- was deposited in the account of the deceased-Ayesha Hussain on 13/12/2014. To buttress his submissions, he placed reliance on the judgment of Hon’ble Supreme Court in the case of Manmohan Nanda v. United India Assurance Co. Ltd., (2022) (4) SCC 582 (para 55 ), Satwant Kumar Sandhu v. New India Assurance Co. Ltd., (2009) 8 SCC 316. Thus, he submits that the learned PLA has committed gross illegality and irregularity in passing the impugned award in favour 6 of the deceased respondent which deserves to be set aside by allowing this writ petition. 8. On the other hand, Shri Hassan and Shri Dwivedi, learned counsel for the respondent vehemently opposes the submission made by learned counsel for the petitioners. They submit that the deceased -Ayesha Hussain was aged about 54-55 years at the time of issuance of insurance policy and it was incumbent upon the petitioner company to get a medical test of her before issuance of such insurance policy. They submit that the deceased Ayesha Hussain was not suffering from any serious life threatening disease and it was discovered only after issuance of the policy. The deceased Ayesha Hussain while filling up the proposal form did not suppress material facts. They submit that if the plea of suppression of material facts is taken by the petitioners in order to repudiate the claim of insurance policy, it was incumbent upon them to prove the same by cogent and prudent evidence before the learned PLA. In the case in hand, the petitioner company was unable to discharge its burden to prove the same before the learned PLA. Learned PLA, on assessment of material available on record, came to a conclusion that there is no suppression of material fact and thus awarded the abovestated amount. They next submitted that apart from Rs.50,000/- as premium, further amount of Rs.25,000/- has also been paid by the deceased Ayesha Hussain. 9. Heard learned counsel for the parties and perused the record. 7 10. The life insurance policy in the case in hand was issued by the petitioner on the basis of a proposal form filled up by the deceased Ayesha Hussain on 20.10.2016. Certain questionnaire is made in the proposal form in respect of the health condition of the insured. One of the query which is mentioned in the proposal form reads as under:- “Any cancer, tumor, cyst or any other unusual growth?” The insured has to put a tick mark in box as no. It appears that claim of the respondent was repudiated by the petitioner as the insured was suffering rom Carcinoma Ovary (a type of cancer) a terminal disease before purchase of insurance policy. The insured has suppressed this material fact while filling the proposal for and obtained the insured policy by playing fraud with the petitioner. It is a further case of the petitioner that from the report of its surveyor/investigator and document annexed with it this fact came to light. It is also the case of the petitioner that the insured was treated for the disease thus repudiation of the claim of insurance of respondent is well found. The crux of the case of the petitioner is suppression of material fact thus it is prayed that the writ petition may be allowed and impugned award of the PLA be set aside. 11. On the contrary, the case of the respondent before the PLA that despite the insurance policy taken the insured value of Rs. 5,00,000/- was not paid to him. Thus, the application was filed before the PLA. 8 12. The core point needs determination by this Court as to mater the life insurance policy was obtained by the insured by suppressing material fact with regard to his health by suppressing material fact with regard to his health thus it is obtained by playing brand with the petitioner. 13. A contract of insurance is one of the utmost good faith. A proposer who seeks to obtain a policy of life insurance is duty- bound to disclose all material facts bearing upon the issue as to whether the insurer would consider it appropriate to assume the risk which is proposed as held by the Hon’ble Supreme Court in the case of Branch Manager, Bajaj Allianz Life Insurance Company Limited and Others vs. Dalbir Kaur reported in (2021) 13 SCC 553. In paragraph 7 it has been held as under: 7. A contract of insurance is one of utmost good faith. A proposer who seeks to obtain a policy of life insurance is duty-bound to disclose all material facts bearing upon the issue as to whether the insurer would consider it appropriate to assume the risk which is proposed. It is with this principle in view that the proposal form requires a specific disclosure of pre-existing ailments, so as to enable the insurer to arrive at a considered decision based on actuarial risk. In the present case, as we have indicated, the proposer failed to disclose the vomiting of blood which had taken place barely a month prior to the issuance of the policy of insurance and of the hospitalization which had been occasioned as a consequence. The investigation by the insurer indicated that the assured was suffering from a pre-existing ailment, consequent upon alcohol abuse and that the facts which were in the knowledge of the proposer had not been disclosed. This brings the ground for repudiation squarely within the principles which 9 have been formulated by this Court in the decisions to which a reference has been made earlier. 14. In case of Satwant Kaur Sandhu vs. New India Assurance Company Limited reported in (2009) 8 SCC 316 it has been held in paragraph 18 as under: 18. A mediclaim policy is a non-life insurance policy meant to assure the policy-holder in respect of certain expenses pertaining to injury, accidents or hospitalisations. Nonetheless, it is a contract insurance failing in the category of contract uberrimae fidei, meaning a contract of utmost good faith on the part of the assured. Thus, it needs little emphasis that when an information on a specific aspect is asked for in the proposal form, an assured is under a solemn obligation to make a true and full disclosure of the information on the subject which is within his knowledge. It is not for the proposer to determine whether the information sought for is material for the purpose of the policy or not. Of course, the obligation to disclose extends only to facts which are known to the applicant and not to what he ought to have known. The obligation to disclose necessarily depends upon the knowledge one possesses. His opinion of the materiality of that knowledge is of no moment. 15. In case of Manmohan Nanda vs. United India Insurance Company Limited reported in (2022) 4 SCC 582 in paragraph 55 has held as under: 55. On a consideration of the aforesaid judgments, the following principles would emerge: 55.1. There is a duty or obligation of disclosure by the insured regarding any material fact at the time of making the proposal. What constitutes a material fact would depend upon the nature of the insurance policy to be taken, the risk to be 10 covered, as well as the queries that are raised in the proposal form. 55.2. What may be a material fact in a case would also depend upon the health and medical condition of the proposer. 55.3. If specific queries are made in a proposal form then it is expected that specific answers are given by the insured who is bound by the duty to disclose all material facts. 55.4. If any query or column in a proposal form is left blank then the Insurance Company must ask the insured to fill it up. If in spite of any column being left blank, the Insurance Company accepts the premium and issues a policy, it cannot at a later stage, when a claim is made under the policy, say that there was a suppression or non-disclosure of a material fact, and seek to repudiate the claim. 55.5. The Insurance Company has the right to seek details regarding medical condition, if any, of the proposer by getting the proposer examined by one of the empanelled doctors. If, on the consideration of the medical report, the Insurance Company is satisfied about the medical condition of the proposer and that there is no risk of pre-existing illness, and on such satisfaction it has issued the policy, it cannot thereafter, contend that there was a possible pre-existing illness or sickness which has led to the claim being made by the insured and for that reason repudiate the claim. 55.6. The insurer must be able to assess the likely risks that may arise from the status of health and existing disease, if any, disclosed by the insured in the proposal form before issuing the insurance policy. Once the policy has been issued after assessing the medical condition of the insured, the insurer cannot repudiate the claim by citing an existing medical condition which was disclosed by the insured in the proposal form, which condition has led to a particular risk in respect of which the claim has been made by the insured. 11 55.7. In other words, a prudent insurer has to gauge the possible risk that the policy would have to cover and accordingly decide to either accept the proposal form and issue a policy or decline to do so. Such an exercise is dependent on the queries made in the proposal form and the answer to the said queries given by the proposer. 16. Thus, right of the above law laid down by the Hon’ble Supreme Court, the facts of the case in hand is examined. 17. In order to prove the suppression of material fact the petitioners examined two witnesses, Ratendra Dixit (N.A.W.-1) deposed in the line of the reply. According to this witness the insured was suffering from Carcinoma Ovary (a type of cancer) before purchase of insurance policy. He further deposed that the insurance policy was purchased by the insured by suppressing the material facts and terminal decease by playing brand with the petitioners. He further deposed that Rs. 83,774/- one year value of the insurance policy has been deposited. In sum and substance this witnesses states that the insured was suffering from terminal decease before purchase of the insurance policy and material facts have been suppressed in the proposal form and policy was purchased by playing fraud with the petitioners. 18. Dr. Yusuf Memon (N.A.W.-2) has deposed that insured came to his hospital for treatment on 31.05.2011 with a referral letter of Tata Memorial Hospital, Bombay. Two chemotherapy cycle was done in his hospital. As per referral letter one chemotherapy cycle of the insured was done in Tata Memorial Hospital, Bombay. He 12 has exhibited discharge summary (Ex. D/2). According to which insured underwent an operation in February 2010 and after that three cycle of chemotherapy was done at Ram Krishna Hospital. From perusal of the statement it is quite evident that the insured was suffering from cancer and also underwent an operation. 19. Original respondent Ahmed Hussain (AW-1) has deposed that his wife Ayesha Hussain (insured) has purchased the life insurance policy from the petitioners. After her death the insured amount was not paid to him. According to him, his wife contacted cancer in the year 2011-2012. He denied that on the date of purchase of policy, i.e. 21.10.2010 insured was suffering from cancer. He denied that from 01.01.2009 till death her wife being was being treated sometimes in Ramkrishna Hospital, Sanjivani Cancer Hospital, Raipur and Tata Memorial Hospital. He admits that his wife took medical leave on 01.01.2009. He says that his wife had tumor and for going to Ramkrishna Hospital leave was taken. He admits the signature of his wife. He also admits that after reading the conditions of the proposal form his wife has put her signature. 20. As stated in earlier paragraphs that contract of insurance including contract of life assurance are contracts of Uberrima Fides (a contract of utmost good faith). All material facts which may contain the insurance company to assure the risk must be disclosed. In the case in hand, proposed form was filled on 20.10.2010 and policy was issued on 21.10.2010. The insured 13 died on 26.03.2012 thus the petitioners in light of provisions contained in Section 45 of Insurance Act, 1938 the petitioners has right to repudiate the claim of the respondent. 21. The learned PLA has allowed the application as if the respondent holding that the petitioner could not prove that before the insurance of insurance policy the insured has suppressed the factum of disease of insured and after deducting Rs. 83,774/- directed the petitioners to pay Rs. 4,16,226/- with 8% annual interest from 13.12.2013 till its realization. 22. Burden to prove that insured was suffering from cancer and material facts have been suppressed before purchase of policy is upon the petitioners. In this context it is expedient to have a look to Ex. D/2, i.e., Discharge Summary of insured proved by Dr. Yusuf Memon (NAW-2). It discloses that patient (insured) is a known case of Carcinoma Ovary operated in February, 2010. Three cycle of chemotherapy at Ramkrishna Hospital. According to it, patient (insured) was admitted on 02.06.2011. It also reflects that 2nd cycle chemotherapy was given. Ex. D/3C is a referral letter of Tata Memorial Hospital. According to it, patient (insured) 1st cycle of chemotherapy on 04.05.2011, 05.05.2011, 12.05.2011 and 19.11.2011. from the evidence available on record it is aptly clear that the insured was suffering from cancer of ovary and was operated in February, 2010 and also given 3 cycle of chemotherapy at Ramkrishna Hospital thereafter. 14 23. It is not the case of the respondent that the proposed form was filled without understanding the implication. The insured filled the form after reading it and understanding the implication of it. Further in declaration column no. 24 petitioner has given the declaration also. That the answer in proposal form is full, complete and true. Initially the original petitioner denies that the insured was treated in different hospitals however the evidence on record suggest otherwise. There is no strong ground to disbelieve the statement of Dr. Yusuf Menon (NAW-2) that as per discharge suffering (Ex. D/2) the insured was a known case of Carcinoma Ovary and operated in February, 2010. That is much prior to issuance of insurance policy. Thus, in light of the evidence available on record the petitioners were able to prove that the insured was suffering from terminal disease before issuance of insurance policy. The insurance policy was purchased by suppressing material facts were suppressed with regard to ailment of the insured. 24. Thus, in the opinion of this Court learned PLA has passed the impugned order with material irregularity. Placing reliance on the judgments cited above, this court is of the firm view that impugned order cannot sustain and is liable to be set aside. 25. As a consequence the writ petition is allowed and the impugned order passed by the learned PLA is hereby set-aside leaving parties to bear their own cost. Sd/- (Sachin Singh Rajput}) JUDGE Deepti