' Mamoor Khan son of Haji Akbar Khan, Proprietor Mamoor and Company Mewa Mandi Inside Bajori Gate, Peshawar City, plaintiff/respondent herein instituted suit on 10-4-1969 in the Court of Senior Civil Judge, Peshawar against New Jubilee Insurance Co.Ltd, defendant/petitioner herein, for grant of a decree of Rs,40,000, the insured sum of money, along profit, bonus and interest whatever may be found in Insurance Policy No, 27298 dated 28-1-1966 in the name of his deceased real uncle Shahbaz Khan son of Khan Said. Later on another plaint was filed on 18-5-1973 wherein State Life Insurance Corporation was substituted as defendant instead of aforementioned defendant. The learned Judge of the trial Court by a judgment and decree dated 10-12-1983 decreed the suit of the plaintiff/respondent as prayed for in the plaint. The learned District Judge of the District Court, Peshawar by a judgment and decree dated 26-11-1984 dismissed the appeal of the defendant/petitioner and maintained the judgment and decree of the learned Judge of the trial Court with costs throughout. State Life Insurance Corporation defendant/petitioner herein has filed this petition for revision of the judgments and decrees of the Courts below.
2. In the plaint the plaintiff/respondent has stated that his real uncle Shahbaz Khan deceased during his life time on 28-1-1966 obtained Life, Insurance Policy of Rs,40,000 and the proposal was accepted by the defendant/petitioner and Insurance Policy No,27298 dated 28-1-1966 was issued and premium of the policy was received by the defendant/petitioner. Shahbaz Khan died on 8-5- 1967 and the plaintiff/respondent is the nominee in the policy of the deceased policy holder and, therefore, is entitled for the insured sum of money along bonus and interest which is payable on the said policy from the defendant/petitioner and in spite of repeated requests and reminders the defendant/petitioner is not paying the same. Hence this plaint.
3. The defendant/petitioner filed written statement and admitted that the policy of Insurance was issued and premium has been received and Shahbaz Khan died on 8-5-1967 but stated that in the proposal and declaration the deceased Shahbaz Khan has bound himself to the effect that in case of untrue averments the contract of assurance would be absolutely null and void and all money paid by the deceased would be forfeited. Shahbaz Khan died of cancer or lympho sarcoma and the death of Shahbaz Khan within less than a year and a half from the date of Insurance Policy aroused suspicions and investigations were conducted through registered insurance surveyors which revealed that the deceased had made proposal and declaration to the Medical Examiner by a false statement, mis-representation or suppression and concealment of material facts. The following two material issues were framed:- "Whether the deceased Shahbaz Khan obtained the policy in question through deliberate and fraudulent concealment of facts and false inducement?
' Whether the contract of policy is not binding on the defendant in case of proof of the above issues?"
' The plaintiff/respondent produced P.W. 1 Dr. SA. Wahid Shah and P.W.2 Dr. Jan Muhammad and thereafter, without recording his own statement, closed his evidence. The defendant/petitioner produced D.W. 1 Noor Muhammad Bhamani, Deputy General Manager of the petitioner, D.W. 2 Shah Nawaz Khan Assistant General Manager of the petitioner and D.W.3 Rashid Ahmad Malik, Surveyor and brought on record of the case the necessary and relevant documents and thereafter closed their evidence. The learned Judge of the trial Court gave his findings on the above mentioned issues in favour of the plaintiff/respondent by referring to the statement of P.W.1 who was petitioner's authorised Medical Officer and held that Shahbaz Khan deceased did not obtain the life insurance policy through fraud or concealment of any facts. The learned Judge of the appellate Court relied on the statement of same P.W.1 and held that even if the deceased had died due to cancer then that disease could be developed after 28-1-1966 and the petitioner Company has not proved that on that particular day (28-1-1966) the deceased had any disease when life policy was obtained. Both the Courts below did not discuss the other evidence and documents produced in the case.
4. The learned counsel for the petitioner submitted that contract of insurance policy is governed by bona fides and the insured person is to disclose all informations/facts likely to pursuade or dissuade insurance company for accepting or not accepting the risk involved in the contract and referred to section 45 of the Insurance Act, 1938 and sections 3, 18 and 31 of the Contract Act, 1872 and relied on the judgments reports (PLD 1967 Karachi 204), (1979 SCMR 295), (1981 CLC 1722) and (PLD 1970 Karachi 462). The learned counsel for the petitioner contended that the Courts below have not read or referred to the documents Exh.D.W.1/1 to Exh.D.W.1/12 and Ex.D.W.2/1 to Ex.D.W.2/6 and specially Exh.D.W.1/10 which is the report of the Surveyors RA. Malik & Co. In the case early death investigation. The learned counsel for the plaintiff/respondent submitted that nothing was concealed from the petitioners and the nominated Medical Officer of the petitioner had examined the deceased and had found the deceased in good health without any disease and on their opinion the proposal and the premium was accepted by the petitioner, the contract is complete and, therefore, the petitioners are liable to pay whatever has been decreed against them by the Courts below.
5. The plaintiff or his authorised agent has not appeared in the case, neither has recorded his statement nor has been subjected to the cross-examination of the defendant on certain issues of facts and, therefore, the plaint itself cannot be relied on issues of fact between the parties and will not be a substantive evidence in the case. In the judgments Reports (PLD 1977 Supreme Court 109) and (PLD 1972 Supreme Court 25), it is laid down that a written statement (and for that matter a plaint) cannot be treated as a substantive evidence if the defendant (or the plaintiff) did not appear as witness at the trial. In absence of this material evidence, the evidence i,e, written statement, witnesses and documents produced by the defendant/petitioner are to be relied and scrutinised for the purpose of eliciting the facts of the case and the law applicable in the case.
Because of, as on behalf of plaintiff only P.W. 1 Dr. SA.Wahid Shah had appeared and has stated that entries of medical examiner report on the proposal form Exh.P.W.1/1 are based merely upon the answers of the examinee, whom he did not know personally, none identified him and he did not himself examine the proposed insured person. P.W.2 Dr. Jan Muhammad a private medical practitioner simply stated that the deceased was his patient and did not detect any disease and forgets about anything else including the year and cause of death of the insured deceased.
6. The defendant/petitioner besides other oral and documentary evidence has produced in the witness-box D.W.3 Rashid Ahmad Malik who has stated that he is approved surveyor of the Government of Pakistan under the Insurance Act and certified by a Controller of Insurances. This witness investigated into the death claim of the deceased Shahbaz Khan and the report was exhibited as Exh.D.W.1/10 without any objection by the plaintiff/respondent. This report Exh.D.W.1/10 dated 13-6-1968 is very exhaustive, elaborate and detailed in respect of facts, circumstances, ailment and death of the deceased. The report mentions that during the inquiry it was revealed that by some special arrangements the patient's relatives had taken away all the charts, X-Ray results, prescriptions etc. When the deceased Shahbaz Khan was discharged from the Lady Reading Hospital on 20-4-1967 which fact is corroborated by the inquiry from Dr. Nasirud Din Azam Khan visiting physician of Lady Reading. Hospital who stated that the patient was suffering from lympo, sarcoma or lung cancer and according to his view the patient's disease was of an advance nature and his history could not be less than two yeaRs, Similarly inquiries have been made from many other persons and the report is concluded that the deceased died in Wahid Nursing Home, Rawalpindi and the deceased's illness was sufficiently pointed out by Dr. Nasirud Din Azam of the Lady Reading Hospital, Peshawar. D.W.1 Noor Muhammad Bhamani, officiating Deputy General Manager of the petitioner appeared as a witness and produced the documents Exh.D.W.1/1 to Exh.D.W.1/13 and supported the written statement filed by the defendant/petitioner. D.W.2 Shah Nawaz Khan, General Manager of the petitioner appeared in the case as a witness and produced the original record of the deceased insured Shahbaz Khan. The plaintiff/respondent failed to prove his case and the defendant/petitioner has produced sufficient evidence and documents in support of their case.
7. The Insurance Policy No,27298 was effective from 28-1-1966, the insurer received the first instalment premium of Rs,3,434.35 and issued receipt dated 3-2-1966. The policy-holder died on 8- 5-1967. The policy of insurance or agreement/contract accordingly is effective from 28-1-1966 and the insurer is bound by the terms and conditions of the insurance policy and is liable to pay the insured sum of money on the death of the policy-holder on 8-5-1967. The rights of insurer to question the policy of life insurance effected as against the suppressed facts by the policy-holder in the proposal for insurance is protected under section 45 of the Insurance Act, 1938. The insurer can call in question the proposal of insurance within two years from the effective date of the commencement of the policy of life insurance on the ground that the policy holder suppressed facts, which it was material to disclose, when the proposal was made and accepted and the policy became effective as agreed upon by the parties. The insurer has the legal rights to repudiate all liabilities under the policy of insurance if it is found by the insurer that the policy-holder had suppressed the material facts at the time of proposal of insurance. The policy of insurance is a contract of utmost good faith between the parties. Deliberate concealment of information in proposal form is a ground for avoiding contract of insurance as held by judgment report of Supreme Court of Pakistan (1979 SCMR 295). It is held so in the judgments reports in PLD 1967 Karachi 204 and PLD 1970 Karachi 462.
8. The policy-holder concealed the facts that he was suffering from lympho, sarcoma or cancer of the lungs as is evident from the aforementioned evidence produced by the defendant/petitioner in the case. It is also in the evidence that American Life Insurance Company rejected the proposal of the deceased for policy of life insurance on the same ground at or about for the same period and time. The defendant/petitioner has successfully repudiated the policy of life insurance within two years and its date of commencement as provided under section 45 of the Insurance Act, 1938.
9. On acceptance of this petition for revision, the judgment and decree dated 10-12-1983 of the learned Judge of the trial Court and the judgment and decree dated 26-11-1984 of the learned Judge of the Appellate Court are set aside and the suit of the plaintiff/respondent is dismissed with costs throughout.