A Division Bench of Justices Shashi Kant Gupta and Pankaj Bhatia of Allahabad High Court on Wednesday held that the period of limitation of 75 days for filing a claim petition under Government insurance policies , particularly the Mukhyamantri Kisan Avam Sarvahit Bima Scheme is unreasonable and arbitrary.
The Court noted that such a short period of limitation militates against the ‘socio-beneficial’ object of the Scheme and is therefore liable to be set aside.
The Bench ordered that for filing claim petition, a period of three years from the date of the death of the deceased, or from the date when the claim is partly or wholly denied, as also given under the Insurance Act and the Limitation Act, shall be available to the beneficiaries under the impugned scheme.
“The ‘law of the land’ which is binding on all insurance contracts by virtue of Section 46 providing three years’ of limitation in the event of a suit being filed has to be accepted as a reasonable period within which a claim for insurance and a claim against the wrongful rejection of the insurance can be preferred.
We take a ‘que’ from the schedule appended to the Limitation Act to hold that the limitation of three years from the date of the death or the date of rejection of the claim, partly or wholly, would be a reasonable time for filing a claim under the Mukhyamantri Kisan Avam Sarvahit Bima Scheme and the similar schemes which were in force prior thereto on behalf of beneficiaries of the Scheme,” the Court held.
The observation was made in a writ petition filed by one Gautam Yadav, seeking insurance amount under the impugned scheme after the demise of his father. As per facts of the case, the Petitioner’s father died in an accident on 3.7.2018 and being a farmer having agricultural holdings was entitled to the grant of compensation under the impugned scheme. The Petitioner claimed to have applied for grant of compensation on 20.10.2018 (immediately after he obtained his father’s death certificate from the authorities) but his claim was denied as time barred.
It was stated that the Petitioner did not prefer the claim within the limitation (45 days (extendable up to maximum 75 days by the DM)) prescribed in the Scheme.
The Court observed that the death had occurred on 03.07.2018, the period of insurance policy expired on 12.9.2018 and as such claim could be made by 11.10.2018 with a further condonable limit upto 11.11.2018. Thus, even as per the scheme, the Petitioner was well within the limitation and the condonable limit prescribed in the scheme. It thus held,
“The impugned order is clearly wrong on that count and thus liable to be set aside holding that the application for compensation filed was well within the prescribed condonable period of limitation as provided in the Scheme.“
Coming to the question of reasonableness of the limitation period so prescribed, the Court said that it cannot oversee the ground reality that often, there is a long waiting period for issuance of death certificates in the State of UP, and keeping that in mind, the period of 75 days to file a claim petition is insufficient. It held,
“The Court cannot also ignore the social facts in the State of Uttar Pradesh, wherein the post death rituals extend for a reasonably long time and collection of documents required to be filed with claim (detailed in the scheme) take a long time and to expect the family of the bereaved, that too illiterate to file a claim within a period of 45 days (maximum upto 75 days) as prescribed under the new Scheme and three months in the erstwhile 12 schemes prima facie is wholly arbitrary and has the potential of frustrating the entire purpose of the Scheme which is to benefit the poor farmers.“
The Bench also explained the applicability of the Insurance Act to the present scheme, in the following words:
“A plain reading of the mandate of Section 46 makes it clear that the statutory right as contained in Section 46 to sue for relief in respect of the policy in a court and the questions of law in connection with any such policy are to be determined in accordance with the law in force in India. Thus, the term ‘law in force’ has been made specifically applicable to all the policies irrespective of the terms of the policy or Agreement.”
Read the order here: