ANJU KALSI versus HDFC ERGO GENERAL INSURANCE COMPANY LIMITED AND OTHERS

Citation: [2022] 2 S.C.R. 287 · Decided: 21-02-2022 · Supreme Court of India · Bench: D.Y. CHANDRACHUD · Disposal: Appeal(s) allowed

Judgment (excerpt)

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[2022] 2 S.C.R. 287
287
ANJU KALSI
v.
HDFC ERGO GENERAL INSURANCE COMPANY LIMITED
AND OTHERS
(Civil Appeal Nos. 1544-1545 of 2022)
FEBRUARY 21, 2022
[DR. DHANANJAYA Y CHANDRACHUD AND
SURYA KANT, JJ.]
Consumer Protection – Insurance Policy – Special conditions
of the policy – Notice of the special conditions under policy to the
account holder – The bank-second respondent, obtained an
insurance cover from first respondent-insurer – Under the insurance
policy, all debit card holders were the beneficiary of the insurance
cover – The appellant’s son was an account holder with the bank
and had also availed debit card from the bank – Appellant’s son
died in an accident – Appellant as mother of the deceased and
nominee made a claim under the insurance cover – District Forum
allowed consumer complaint and awarded Rs. 5 lakhs with interest
– The SCDRC held that the deceased had failed to use the debit
card with a non-ATM transaction during the period of three months
immediately prior to the date of the accident and hence, the condition
precedent for a claim under the insurance policy was not fulfilled –
The order of the SCDRC was affirmed by the NCDRC – The
contention of the appellant was that save and except for the covering
letter which indicated that an insurance cover against personal
accident was being provided to the account holder, neither the
insurer nor the bank had ever furnished the insurance policy, its
terms and conditions or any document related to the insurance cover
to the account holder – Before the Supreme Court, the genesis of
the dispute lies in whether the Special Conditions of the policy which
was issued by the bank to the insurer were drawn to the notice of
the account holder – Held: The terms of the insurance cover had to
be specifically communicated to the account holder – The account
holder had to be put on notice that the insurance cover would become
available only after a transaction took place of the nature spelt out
in the special conditions of the insurance policy – Insistence on
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SUPREME COURT REPORTS
[2022] 2 S.C.R.
communication to the account holder is necessary because the policy
was issued to the bank by the insurer – The account holders are
beneficiaries of the policy – In the present case, the bank did not
choose to defend the proceedings – Insurer belongs to the same
group as of the bank, it could have summoned for production of
documents as to as to whether the debit card usage guide was made
available to the account holder – In absence of such exercise, the
case of the appellant as set out in the complaint remained
uncontroverted – Respondents were not able to establish on a cogent
basis that special conditions of the policy were drawn to the notice
of the account holder – Accordingly, the judgment of the NCDRC
set aside and the judgment of the District Forum restored.
Allowing the appeals, the Court
HELD: 1. The insurance cover was governed by a policy
between the first and the second respondents. The terms of the
insurance cover had to be specifically communicated to the
account holder. The account holder had to be put on notice that
the insurance cover would become available only after a
transaction took place of the nature spelt out in the special
conditions of the insurance policy. Insistence on communication
to the account holder is necessary because the policy was issued
to the bank by the insurer. The account holders are beneficiaries
of the policy. In the present case, the bank did not choose to
defend the proceedings at all. The insurer who also belongs to
the HDFC group could well have applied for a summons to be
issued to the bank for production of its records in the course of
the evidence which would establish as to whether the debit card
usage guide had been made available to the account holder. In
this backdrop, and in the absence of such a course of action being
adopted, the case of the appellant as set out in the complaint
remained uncontroverted. Consequently, unless the respondents
were able to establish on a cogent basis that the special conditions
of the policy which was issued by the first respondent to the second
respondent were drawn to the notice of the account holder for
whose benefit the insurance cover extended, the claim ought not
to have been rejected. [Para 12][292-H; 293-A-D]
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CIVIL APPELLATE JURISDICTION: Civil Appeal Nos. 1544-
1545 of 2022.
From the Judgment and Order dated 24.03.2017 of the Na

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