Oral Judgment:
Bharati Dangre, J.
1. In availing the benefit of Group Health Insurance, the Petitioner placed his claim before his employer i.e. Export Import Bank of India through his communication dated 24/05/2022.
The four claims for distinct period on behalf of the Petitioner himself and in respect of his spouse, aggregated to Rs.1,13,487.49/-.The communication also requested processing by the TPA/Insurance Company. Since this claim is turned down by United India Insurance Co. Ltd., by relying upon the time-lines set out in the insurance policy, the Petitioner is before us, seeking the relief of quashing and setting aside of the decision of the Insurance Company, rejecting the claim of the Petitioner on the ground that it is time barred.
2. By consent of the parties, we issue Rule, which is made returnable forthwith.
The Petitioner purchased a Group Health Policy from United India Insurance Co. Ltd. for a period covering from 01/04/2021 and ending in the midnight of 31/03/2022. The insurance policy, with the type ‘family floater basis’, stipulated the terms and conditions and the policy stipulated various expenses to be covered, by setting out the eligibility criteria as well as the claim procedure.
Clause 7.2 of the said policy under the caption, ‘procedure for reimbursement of claims’, made it imperative for the insured person to submit necessary documents to TPA/the company within the prescribed time-limit as specified thereunder and the relevant portion of the said policy reads thus :-
| Sr.No. | Type of Claim | Prescribed time limit |
| 1. | Reimbursement of hospitalisation, day care and pre-hospitalisation expenses | Within thirty days of date of discharge from hospital |
| 2. | Reimbursement of post-hospitalisation expenses | Within fifteen days from completion of post-hospitalisation treatment. |
“(iii) Any delay in notification or submission may be condoned on merit where delay is proved to be for reasons beyond the control of the Insured Person”.
Similarly, in clause 8 of the policy, under caption “General terms and conditions”, clause 8.2 clearly stipulated thus :-
“The terms and conditions of the policy must be fulfilled by the Insured Person for the Company to make any payment for claim (s) arising under the policy.”
4. The claim set out by the insured on 24/05/2022 is summarized below :-
| Sr.No. | Insured person on whose behalf claim is made | Period of claim | Amount of claim (Rs.) |
| 1. | C.P.Ravindranath Menon | 08-04-2021 | 6,711.00 |
| 2. | C.P.Ravindranath Menon | 01-09-2021 to 24-04-2022 | 18,417.11 |
| 3. | Ms.Sindhu Ravindranath Menon | 08-04-2021 to 19-12-2021 | 61,611.38 |
| 4. | Ms.Sindhu Ravindranath Menon | 01-01-2022 to 19-04-2022 | 26,748.00 |
| Total | 1,13,487.49 | ||
6. When the Insurance Company communicated with the Petitioner/insured, that the claim was beyond the prescribed period as set out in the policy, the Petitioner relied upon the decision of the Apex Court in the case of The Oriental Insurance Company Ltd. Vs. Sanjesh & Anr.(2022 SCC Online SC 806), where the imposition of a condition of time-line in lodging of a claim in a policy was held to be contrary to Section 28(b) of the Indian Contract Act, 1872 and was declared to be void.
However, the Insurance Company, by submitting that the decision of the Apex Court was based on factual aspect and the case being of a contract entered between the parties, stuck up to its stand by asserting that the time-line is specified for submission of the claim and since the insurance policy clearly contemplated that bills more than 90 days old will not be paid/reimbursed, refused to entertain the claim of the Petitioner.
7. Ms.Chavan, the learned counsel representing the Insurance Company, would invite our attention to the policy which the Petitioner had availed and she would submit that since it is a contract between the parties and the Petitioner agreed to all the stipulations therein, which clearly contemplated that bill more than 90 days will not be paid/reimbursed, he is bound by the same and since the reimbursement is claimed beyond the said period, the Insurance Company has rightly refused the claim.
8. The learned counsel for the Petitioner has placed heavy reliance upon the decision of the Apex Court in the case of Sanjesh (supra) and we have perused the said decision, which is placed before us.
On 11/03/2022, the Apex Court, considered the same argument advanced on behalf of the Insurance Company and in the said case, by the Oriental Insurance Company Limited, that the claim was not filed within a period of one month or extending condonable period of one month. Dealing with the said submission, the Apex Court observed thus :-
“We do not find any merit in the said arguments in view of Section 28 of the Indian Contract Act, 1872 (for short, ‘the Act’) which reads as under:-
“28. Agreements in restraint of legal proceedings, void.- [Every agreement,-
(a) by which any party thereto is restricted absolutely from enforcing his rights under or in respect of any contract, by the usual legal proceedings in the ordinary tribunals, or which limits the time within which he may thus enforce his rights;
or
(b) which extinguishes the rights of any party thereto, or discharges any party thereto, from any liability, under or in respect of any contract on the expiry of a specified period so as to restrict any party from enforcing his rights, is void to the extent.
In view of the aforesaid section, the condition of lodging claim within a period of one month, extendable by another one month is contrary to Section 28 of the Act and thus void.
In view of the said fact, we do not find any ground to interfere with the order passed by the High Court.”
By relying upon sub-clause (b) of Section 28, the Apex Court thus ruled that the condition of lodging claim within a period of one month, extendable by another one month is contrary to Section 28 and this condition was held to be void.
9. In the wake of the aforesaid authoritative pronouncement, when we perused the insurance policy, which the Petitioner had availed the benefit of, with a specific stipulation to the effect that no claim shall be entertained after more than 90 days and when the policy provide that for the claim of reimbursement in respect of hospitalisation, day care and pre-hospitalisation expenses, the time-limit prescribed was within 30 days from discharge from the hospital and in case of reimbursement of post-hospitalisation expenses, the time-limit for setting up the claim was within 15 days from completion of post-hospitalisation treatment, with a specific clause that no claim shall be entertained beyond 90 days, we find that the said clause imposing a limitation on invocation of right under the policy only on the ground that it was beyond the specified period, therefore, clearly attract clause (b) of Section 28 of the Indian Contract Act.
Section 28 of the Indian Contract Act prescribe that any agreement, which extinguishes the rights of any party thereto, or discharges any party thereto, from any liability, under or in respect of any contract on the ground of expiry of a specified period, so as to restrict any party from enforcing his right, is void to that extent, and in our view, such an inhibition in insurance policy restricting the period of availing the benefit under the policy, which the insured is otherwise entitled to avail, cannot be sustained and has to be declared as void and non-est in the wake of the decision of the Apex Court.
10. The learned counsel for the Insurance Company, has placed reliance on the decision of the Apex Court in the case of United India Insurance Co. Ltd. Vs. Harchand Rai Chandan Lal((2004) 8 SCC 644), in support of her submission that, the insurance policy is a contract between the parties, where the insurer undertakes to compensate the loss suffered by the insured on account of risk covered by the insurance policy, and therefore, the terms of the agreement have to be strictly construed to determine the extent of the liability of the insurance and the insured cannot claim anything more than what is covered by the insurance policy.
We have no difficulty in accepting the said proposition in law, and definitely the insurance policy is a contract and, therefore, strictly governed by the Indian Contract Act and if there is an embargo, which is created under Section 28, in the form of any restraint being imposed on any agreement, and the one which is specified in clauses (a) and (b) of Section 28, the policy being a contract, will strictly be enforceable.
She would also rely upon the the proposition laid down in the said decision that the terms of contract have to be strictly read and natural meaning be given to it and no outside aid should be sought. The argument is reproduced only to be rejected, since the contracts are governed by the Indian Contract Act and if Section 28 is the facet of this contract, then it must come into operation with full force.
11. The Writ Petition is, therefore, allowed in terms of prayer clauses (a) and (b).
Respondent No.1-Insurance Company shall reimburse the amount under the policy within a period of eight (8) weeks from today, with interest at the rate of 6% p.a, when it become due and payable.