No 224 of 1959
Appeal from the judgment and decree dated August 28 1956 of the Madhya Pradesh High Court in FA No 90 of 1949
A V Viswanatha Sastri section N Andley Rameshwar Nath and PL Vohra for the appellant
section T Desai R Ganapathy Iyer and K L Hathi for the respondent
January 15 The Judgment of the Court was delivered by section K DAS J
This is an appeal on a certificate granted by the High Court of Madhya Pradesh under article 133 1 a of the Constitution The appellant is Mithoolal Nayak who took an assignment on october 18 1945 of a life insurance policy on the life of one Mahajan Deolal for a sum of Rs 25000 in circumstances which we shall presently state
Mahajan Deolal died on November 12 1946 573 Thereafter the appellant made a demand against the respondent company for a sum of Rs 26000 and odd on the basis of the life insurance policy which had been assigned to him
This claim or demand of the appellant was repudiated by the respondent company by a letter dated October 10 1947 which in substance stated that the insured Mahajan Deolal had been guilty of deliberate mis statements and fraudulent suppression of material information in answers to questions in the proposal form and the personal statement which formed the basis of the contract between the insurer and the insured
On the repudiation of his claim the appellant brought the suit out of which this appeal has arisen
The suit was originally instituted against the oriental Government Security Life Assurance co Ltd Bombay which issued the policy in favour of Mahajan Deolal on March 13 1945
Latter on the passing of the life Insurance corporation Act 1956 there was a statutory transfer of the assets and liabilities of the controlled life business of all insurance companies and insurers operating in India to a Corporation known as the Life Insurance Corporation of India
By an order of this Court made on February 16 1960 the said Corporation was substituted in place of the original respondent
For brevity as convenience we shall ignore the distinction between the original respondent and the said Corporation and refer to the respondent in this judgment as the respondent company
The Suit was decreed by the learned Additional District Judgment of Jabalpur by his judgment dated May 7 1949
The respondent company then preferred an appeal to the High Court of Madhya Pradesh
This appeal was heard by a Division Bench of the said High Court and by a judgment dated August 28 1956 the appeal was allowed and the suit was dismissed with costs
It is from 574 that appellate judgment and decree that the present appeal has been brought to this Court
We now proceed to state some of the relevant facts relating to the appeal and the contentions urged on behalf of the appellant
Mahajan Deolal was a resident of
village Singhpur Tehsil Narsinghpur
It appears that he was a small landholder and possessed several acres of land
Sometime in December 1942 Mahajan Deolal submitted a proposal through one Rahatullah Khan an agent of the respondent company at Narsingpur for the insurance of his life with the respondent company for a sum of Rs 10000 only
Mahajan Deolal s age at that time was about 45 as stated by him
In the proposal form which was submitted to the respondent company Mahajan Deolal mentioned the name of one Motilal Nayak by profession a doctor as a personal friend who best knew the state of the health and habits etc
of the insured
This Motilal Nayak be it noted is a brother of the appellant the evidence in the record showing that the two brothers lived together in the same house
When the proposal for insurance of his life was made by Mahajan Deolal in December 1942 he was examined by a doctor named Dr D D Desai
This doctor submitted two reports about Mahajan Deolal one report it appears was admitted with the proposal form through the agent of the respondent company another report was sent in a confidential cover along with a letter from the doctor
In this letter exhibit D 22 the doctor explained why he was submitting two medical reports
In substance he said that the report submitted with the proposal form at the instance of the agent Rahatullah Khan was not a correct report and the correct report was the one which he enclosed in the confidential cover
In that report Dr Desai said that Mahajan Deolal 575 was anaemic looked about 55 years old had a dilated heart and his right lung showed indications of an old attack of pneumonia or pleurisy
The doctor further said that the general health of Mahajan Deolal was very much run down and he was a total physical wreck
The doctor opined that Mahajan Deolal  life was an uninsurable life
It appears that nothing came out of the proposal made by Mahajan Deolal for the insurance of his life in December 1942
The evidence of the Inspector of the respondent company shows that on receipt of Dr Desai s reports the respondent company directed that Mahajan Deolal should be further examined by the Civil Surgeon Hoshangabad and District Medical officer Railways at Jabalpur
Mahajan Deolal could not however be examined by the two doctors aforesaid and according to the rules of the respondent company the proposal lapsed on the expiry of six months for want of completion of the medical examination as required by the respondent company
Then on July 16 1944 a second proposal was made through the same agent of the respondent company for the insurance of the life of Mahajan Deolal this time for a sum of Rs 25000 
The Inspector of the respondent company said in his evidence that this second proposal was made at the instance of the same agent Rahatullah Khan inasmuch as the proposal of 1942 had not been rejected but had only lapsed
It appears that at the time of the first proposal in 1942 Mahajan Deolal had paid a sum of Rs 571 and odd towards the first premium due in case the proposal was accepted
In the personal statement accompanying the second proposal of July 16 1944 it was stated that an earlier proposal for insuring the life of Mahajan Deolal was pending with the respondent company
Now in the proposal form exhibit D 11 there was a question question No 13 to the following effect 576 Have you within the past five years consulted any medical man for any ailment not necessarily confining you to your house If so give details and state names and addresses of medical man consulted
 The answer given to the question was No
This answer according to the case of the respondent was false and deliberately false
because according to the evidence of one Dr PN Lakshmanan Consulting Physician at Jabalpur Mahajan Deolal was examined and treated by the said doctor between the dates September 7 1943 and October 6 1943 when the doctor found that Mahajan Deolal was suffering from anaemia oedema of the feet diarrhoea and panting on exertion
We shall advert in greater detail to the evidence of Dr Lakshmanan at a later stage
In his personal statement accompanying the second proposal Mahajan Deolal answered in the negative question 12b the question being as to when he was last under medical treatment and for what ailment and how long
In the same personal statement with regard to questions for example question nos
5a 5b etc as to whether he suffered from shortness of breath anaemia asthma etc Mahajan Deolal gave negative answers
The contention on behalf of the respondent company was that these answers in the personal statement were also deliberately false and constituted a fraudulent suppression of material particulars relating to the health of the insured
With regard to the second proposal and the personal statement accompanying it Dr Motilal Nayak brother of the appellant gave a friend s report in which he said that Mahajan Deolal health was good and that he had never heard that Mohajan Deolal suffered from any illness
It is worthy of note here that Dr Motilal Nayak himself took Mahajan Deolal to Dr Lakshmanan for treatment at Jabalpur in September October 1943
On receipt 577 of the second proposal in July 1944 Mahajan Deolal was examined by Dr Kapadia who was the District Medical officer of the Railways at Jabalpur
Dr Kapadia reported that Mahajan Deolal was a healthy man and looked about 52 to 54 years old
He recommended that Mahajan Deolal might be given a policy of fourteen years
In his report Dr Kapadia noted that Mahajan Deolal had stated that he had suffered from pneurnonia four or five years ago and that he had also cholera some years ago
No mention however was made of anaemia asthma shortness of breath etc
On December 29 1944 Mahajan Deolal made a further declaration of his good health and so also on February 12 1945
On March 13 1945 the policy was issued by the respondent company
It contained the usual terms of such life insurance policies one of which was that in case it would appear that any untrue or incorrect averment had been made in the proposal form or personal statement the policy would be void
The first premium due on the policy was taken from the amount which was already in deposit with the respondent company in connection with the proposal made in 1942
Then on May 22 1945 Mahajan Deolal wrote a letter to the respondent company in which he said that his financial condition had become suddenly worse and that he would not be able to pay the premium for the policy
He requested that the policy be cancelled
In the meantime the premium for 1945 not having been paid the policy lapsed
Then on October 28 1945 Mahajan Deolal made a request for revival of the policy but a few days before that namely on October 18 1945 the policy was assigned in favour of the appellant by an endorsement made on the policy itself
This assignment was duly registered by the respondent company by means of its letter dated November 1 1945 in which the respondent company said that it accepted the assignment without expressing any opinion as to its validity or 578 effect
The respondent company also made an enquiry from the appellant as to whether the latter had any insurable interest in the life of the insured and what consideration had passed from him to the insured
To this the appellant replied that he had no insurable interest in the life of Mahajan Deolal except that the latter was a friend and he the appellant had purchased the policy for a sum of Rs 42712 nP being the premium paid by him so far because Mahajan Deolal did not with to continue the policy
On his request for a revival of the policy Mahajan Deolal was again medically examined this time by one Dr Belapurkar
Later on February 25 1946 he was examined by Dr Clarke
The policy was then revived on payment of all arrears of premium these arrears having been paid by the present appellant
On receipt of the revival fee the policy appears to have been revived some time in July 1946
We have already stated that Mahajan Deolal died in November 1946
The certificate of Dr Clarke who was the medical attendant at the time when Mahajan Deolal died showed that the primary cause of death of Mahajan Deolal was malaria followed by severe type of diarrhoea the secondary cause was anaemia chronic bronchitis and enlargement of liver
In the certificate which Dr Clarke gave there was mention of certain other medical practitioners who had attended Mahajan Deolal at the time of his death
One of such medical practitioners mentioned in the certificate was Dr Lakshmanan
On receipt of this certificate the respondent company got into touch with Dr Lakshmanan and discovered from him that Mahajan Deolal had been treated in September October 1943 by Dr Lakshmanan for ailments which according to the doctor were of a serious nature
Several issues were tried between the parties in the trial court
But the four questions which 579 were argued in the High Court and on which the fate of the appeal depends were these 1 Whether the policy was vitiated by fraudulent suppression of material facts by Mahajan Deolal  2 Whether the present appellant had no insurable interest in the life of the insured and if so can he sue on the policy  3 Whether the respondent company had issued the policy with full knowledge of the facts relating to the health of the insured and if so is it estopped from contesting the validity of the policy  and 4 Whether in any event the appellant is entitled to refund of the money he had paid to the respondent company  These are the four questions which have been agitated before us and we shall deal with such of them as are necessary for deciding this appeal
So far as the first question is concerned the learned trial Judge found that though Mahajan
Deolal had given a negative answer to question no 13 in the proposal form and to questions nos
5a 5b 5 f and 12b in the personal statement these answers though not strictly accurate furnished no grounds for repudiating the claim of the appellant by the respondent company in as much as s45 of the 4 of 1938 applied and the answers did not amount to a fraudulent suppression of material facts by the policy holder within the meaning of that section
The learned trial Judge found that the ailments for which Dr Lakshmanan treated Mahajan Deolal in September October 1943 were of a causal or trivial nature and the failure of the policy holder to disclose those ailments did not attract the second part of 580 section 45 of the 
The High Court came to a contrary conclusion and held that even applying section 45 of the  the policy holder was guilty of a fraudulent suppression of material facts relating to his health within the meaning of that section and the respondent company was entitled to avoid the contract on that ground
On behalf of the appellant it has been argued before us that the finding of the learned trial Judge on this question was the correct finding and that the High Court was wrong in arriving at a contrary finding on this question in view of the evidence given in the case
The judgment of the High Court is a judgment in reversal and the appellant has a right of appeal under article 1331a of the Constitution in as much as the value of the subject matter of the dispute in the court of first instance and still in dispute is more than Rs 20000 
We have therefore allowed learned counsel for the parties to take us through the evidence in the case
On a consideration of that evidence we have come to the conclusion that the finding of the High Court is the correct finding
We shall presently consider the evidence but it may be advantageous to read first section 45 of the  as it stood at the relevant time
The section so far as it is relevant for our purpose is in these terms No policy of life insurance effected before the commencement of this Act shall after the expiry of two years from the date of commencement of this Act and no policy of life insurance effected after the coming into force of this Act shall after the expiry of two years from the date on which it was effected be called in question by an insurer on the ground that a statement made in the proposal for insurance or in any report of a medical officer or referee or friend of the insured or in any other document leading to 581 the issue of the policy was inaccurate or false unless the insurer shows that such statement was on a material matter or suppressed facts which it was material to disclose and that it was fraudulently made by the policy holder and that the policy holder knew at the time of making it that the statement was false or that it suppressed facts which it was material to disclose
x x x x x x It would be noticed that the operating part of section 45 states in effect so far as is relevant for our purpose that no policy of life insurance effected after the coming into force of the Act shall after the expiry of two years from the date on which it was effected be called in question by an insurer on the ground that a statement made in the proposal for insurance or in any report of a medical officer or referee or friend of the insured or in any other document leading to the issue of the policy was inaccurate or false the second part of the section is in the nature of a proviso which creates an exception
It says in effect that if the insurer shows that such statement was on a material matter or suppressed facts which it was material to disclose and that it was fraudulently made by the policyholder and that the policy holder knew at the time of making it that the statement was false or that it suppressed facts which it was material to disclose then the insurer can call in question the policy effected as a result of such inaccurate or false statement
In the case before us the policy was issued on March 13 1945 and it was to come into effect from January 15 1945
The amount insured was payable after January 15 1968 or at the death of the insured if earlier
The respondent company repudiated the claim by its letter dated October 10 1947
Obviously therefore two years had expired from the date on which the policy was effected
We are clearly of the opinion that section 45 of the applies in the present case in 582 view of the clear terms in which the section is worded though learned counsel for the respondent company sought at one stage to argue that the revival of the policy some time in July 1946 constituted in law a new contract between the parties and if two years were to be counted from July 1946 then the period of two years had not expired from the date of the revival
Whether the revival of a lapsed policy constitutes a new contract or not for other purposes it is clear from the wording of the operative part of section 45 that the period of two years for the purpose of the section has to be calculated from the date on which the policy was originally effected in the present case this can only mean the date on which the policy exhibit P 2 was effected
From that date a period of two years had clearly expired when the respondent company repudiated the claim
As we think that section 45 of the applies in the present case we are relieved of the task of examining the legal position that would follow as a result of inaccurate statements made by the insured in the proposal form or the personal statement etc
in a case where section 45 does not apply and where the averments made in the proposal form and in the personal statement are made the basis of the contract
The three conditions for the application of the second part of section 45 are a the statement must be on a material matter or must suppress facts which it was material to disclose b the suppression must be fraudulently made by the policy holder and c the policy holder must have known at the time of making the statement that it was false or that it suppressed facts which it was material to disclose
The crucial question before us is whether these three conditions were fulfilled in the present 583 case
We think that they were
We are unable to agree with the learned trial Judge that the ailments for which Mahajan Deohal was treated by Dr Lakshmanan in September October 1943 were trivial or casual ailments
Nor do we think that Mahajan Deolal was likely to forget in July 1944 that he had been treated by Dr Lakshmanan for certain serious ailments only a few months before that date
This brings us to a consideration of the evidence of Dr Lakshmanan
That evidence is clear and unequivocal
Dr Lakshmanan says that Dr Motilal Nayak brought the patient to him at Jabalpur
We have already referred to the fact that Dr Motilal Nayak had himself made a false statement in his friend s report dated July 17 1944 when he said that he had never heard that the insured had suffered from any illness
It is impossible to believe that Dr Motilal Nayak would not remember that he had himself taken the insured to Jabalpur for treatment by Dr Lakshmanan who was an experienced consulting physician
Dr Lakshmanan said that when he first examined Mahajan Deolal on September 7 1943 he found that his condition was serious as a result of the impoverished condition of his blood and that Mahajan Deolal was suffering from anaemia oedema of the feet diarrhoea and panting on exertion
The doctor asked for an examination of the blood
The pathological report supported the diagnosis that Mahajan Deolal was suffering from secondary anaemia meaning thereby that anaemia was due to lack of iron and malnutrition
Dr Lakshmanan further found that from the symptoms disclosed the disease was a major one
Mahajan Deolal had also cardiac asthma which was a symptom of anaemia and due to dilatation of heart
Dr Lakshmanan saw the patient again on September 9 1943 and then again on September 16 1943
On October 6 1943 Mahajan Deolal himself went to Dr Lakshmana
On that date Dr Lakshmanan found that 584 anaemia had very greatly disappeared
In cross examination Dr Lakshmanan admitted that the anaemia dilatation of heart and cardiac asthma from which Mahajan Deolal was suffering continued a passing phase which might disappear by treatment
He further admitted that he did not mention cardiac asthma in his letter addressed to the respondent company
We have given our very earnest consideration to the evidence of Dr Lakshmanan and we are unable to hold that the ailments from which Mahajan Deolal was then suffering were either trivial or casual in nature
The ailments were serious though amenable to treatment
Mahajan Deolal s son gave evidence in the case and he said in his evidence that though Dr Lakshmanan prescribed some medicine his father did not take it
He further said that his father was a strict vegetarian
This evidence was given by the son with regard to what the doctor had said that he prescribed fresh liver juice made at home according to his directions three times a day
He also prescribed iron sulphate in tablet from with plenty of water
The son further said that during his stay at Jabalpur his father felt weakness though he used to move about freely and was never confined to bed
The son tried to make it appear in his evidence that his father was suffering from nothing serious
Dr Lakshmanan said in his evidence that his fees for visiting a patient at Jabalpur were Rs 16 per visit
We agree with the High Court that if Mahajan Deolal was not suffering from any serious ailment he would not have been taken by his physician Dr Motilal Nayak from his village to Jabalpur nor would he have consulted Dr Lakshmanan a consulting physician of repute for so many days on payment of Rs 16 per visit
No doubt Mahajan Deolal s son now tries to make light of the illness of his father but Dr Lakshmanan s evidence shows elearly enough that in September October 1943
Mahajan 585 Deolal was suffering from a serious type of anaemia for which he was treated by Dr Lakshmanan
Mahajan Deolal could not have forgotten in July 1944 that he was so treated only a few months earlier and furthermore Mahajan Deolal must have known that it was material to disclose this fact to the respondent company
In his answer to the questions put to him he not only failed to disclose what it was material for him to disclose but he made a false statement to the effect that he had not been treated by any doctor for any such serious ailment as anaemia or shortness of breath or asthma
In other words there was a deliberate suppression fraudulently made by Mahajan Deolal
Fraud according to section 17 of the IX of 1872 means and includes Inter alia any of the following acts committed by a party to a contract with intent to deceive another party or to induce him to enter into a contract 1 the suggestion as to a fact of that which is not true by one who does not believe it to be true and 2 the active concealment of a fact by one having knowledge or belief of the fact
Judged by the standard laid down in section 17 Mahajan Deolal was clearly guilty of a fraudulent suppression of material facts when he made his statements on July 16 1944 statements which he must have known were deliberately false
Therefore we are in agreement with the High Court in answering the first question against the appellant
We may here dispose of the third question
Learned counsel for the appellant has argued before us that Mahajan Deolal was examined under the direction of the respondent company by as many as four doctors namely Dr Desai Dr Kapadia Dr Belapurkar and Dr Clarke
It is further pointed out that Mahajan Deolal had correctly 586 disclosed that he had suffered previously from malaria pneumonia and cholera
Dr Kapadia it is pointed out was specifically asked to examine Mahajan Deolal in view of the conflicting reports which Dr Desai had earlier submitted
On these facts the argument has been that the respondent company had full knowledge of all facts relevant to the state of health of Mahajan Deolal and having knowledge of the full facts it was not open to the respondent company to call the policy in question on the basis of the answers given by Mahajan Deolal in the proposal form and the personal statement even though those answers were inaccurate
Learned counsel for the appellant has referred us to the Explanation to section 19 of the in support of his argument
We are unable to accept this argument as correct
It is indeed true that Mahajan Deolal was examined by as many as four doctors
It is also true that the respondent company had before it the conflicting reports of Dr Desai and it specially asked Dr Kapadia to examine Mahajan Deolal in view of the reports submitted by Dr Desai
Yet it must be pointed out that the respondent company had no means of knowing that Mahajan Deolal had been treated for the serious ailment of secondary anaemia followed by dilatation of heart etc
in September October 1943 by Dr Lakshmanan
Nor can it be said that if the respondent company had knowledge of those facts they would not have made any difference
The principle underlying the Explanation to section 19 of the Contract Act is that a false representation whether fraudulent or innocent is irrelevant if it has not induced the party to whom it is made to act upon it by entering into a contract
We do not think that principle applies in the present case
The terms of the policy make it clear that the averments made as to the state of health of the insured in the proposal form and the personal statement were the basis of the contract between the 587 parties and the circumstance that Mahajan Deolal had taken paint to falsify or conceal that he had been treated for a serious ailment by Dr Lakshmanan only a few months before the policy was taken shows that the falsification or concealment had an important bearing in obtaining the other party s consent
A man who has so acted cannot after wards turn round and say It could have made no difference if you had known the truth
 In our opinion no question of waiver arises in the circumstances of this case nor can the appellant take advantage of the Explanation to section 19 of the 
Our finding on the first question makes it unnecessary for us to decide the second question namely whether the present appellant merely gambled on the life of Mahajan Deolal when he took the assignment on October 18 1945
The contention of the respondent company was that appellant had no insurable interest in the life of Mahajan Deolal and when he took the assignment of the policy on October 18 1945 he was merely indulging in a gamble on Mahajan Deolal s life the contract was therefore void by reason of section 30 of the 
On behalf of the appellant however the contention was that section 38 of the insurance Act provided a complete code for assignment and transfer of insurance policies and the assignment made in favour of the appellant by Mahajan Deolal was a valid assignment in accordance with the provisions of section 38 aforesaid
The High Court it appears proceeded on the footing that from the very inception the policy was taken for the benefit of the appellant on the basis of a gamble on the life of Mahajan Deolal it said that the appellant and his brother Dr Motilal Nayak knew very well that Mahajan Deolal was not likely to live very long and when the policy was taken out in 1944 it was really for the benefit of the present appellant who soon after took an assignment 588 on payment of the premium already paid by Mahajan Deolal and such arrears of premium as were then outstanding
It is unnecessary for us to give our decision on these contentions because if Mahajan Deolal was himself guilty of a fraudulent suppression of material facts on which the respondent company was discharged from performing its part of the contract the appellant who holds an assignment of the policy cannot stand on a better footing than Mahajan Deolal himself
It was argued before us that is the policy was valid in its inception that is to say if it was in fact effected for the use and benefit of Mahajan Deolal who undoubtedly had an insurable interest in his own life it could not afterwards be invalidated by assignment to a person who had no interest but who merely took it as a speculation
Our attention was drawn to several decisions on this question American and English noticed in para 502 of MacGillivray on Insurance law fourth Edition
We consider it unnecessary to examine those decisions or to go into the question posed therein
That question must be left to be determined in a case where it properly arises
As we have stated earlier on our conclusion on the first question the appellant is clearly out of Court and can not claim the benefit of a contract which had been entered into as a result of a fraudulent suppression of material facts by Mahajan Deolal
This brings us to the last question namely whether the appellant is entitled to a refund of the money he had paid to the respondent company
Here again one of the terms of the policy was that all moneys that had been paid in consequence of the policy would belong to the company if the policy was vitiated by reason of a fraudulent suppression of material facts by the insured
We agree with the High Court that where the contract is bad on the ground of fraud the party who has been guilty of fraud or a person who claims under him can not 589 ask for a refund of the money paid
It is a well established principal that courts will not entertain an action for money had and received where in order to succeed the plaintiff has to prove his own fraud
We are further in agreement with the High Court that in cases in which there is stipulation that by reason of a breach of warranty by one of the parties to the contract the other party shall be discharged from the performance of his part of the contract neither section 65 nor section 64 of the has any application
For the reasons given above we have come to the conclusion that there in no merit in the appeal
The appeal is accordingly dismissed with costs
Appeal dismissed


Summary:
In 1942 one M sent a proposal for the insurance of his life
He was examined by Dr D who submitted two reports one with the proposal form and one confidential
The confidential report showed that M was anaemic had a dilated heart and his right lung showed indications of an old attack of pneumonia or pleurisy and that he was a total physical wreck
Nothing came out of this proposal and it lapsed
In 1943 M consulted and was treated by one Dr L for anaemia oedema of the feet diarrhoea and panting on exertion
In 1944 M made a second proposal for insurance of his life
Against the question in the proposal form whether he had consulted any medical man for any ailment within the last five years he gave the answer Nor 
He also did not disclose any of his ailments
After medical examination by one Dr K the proposal was accepted and a policy for Rs 25000 was issued on March 13 1945
The policy lapsed for non payment of premium but was revived in July 1946
In November 1946 M died
His assignee the appellant made a demand for Rs 26000 but the Company on October 10 1947 repudiated it on the ground that the policy had been obtained by deliberate mis statement and fraudulent suppression of material facts
Thereupon the appellant filed a suit to recover the amount of the policy contending that section 45 Insurance Act barred the company from calling in question the policy after two years on the ground that any statement made in the proposal was inaccurate or false  Held that the policy holder was guilty of fraudulent suppression of material facts relating to his health and the Company was entitled to avoid the contract
Section 45 Insurance Act applied to the case as two years had lapsed since the policy was effected in view of the language of s45 the two years could not be counted from the date of the revival of the policy
The second part of section 45 entitled the company to repudiate the contract even after the expiry 572 of two years if three conditions were fulfilled viz a the statement was on a material matter or there was suppression of facts which it was material to disclose b the suppression was fraudulently made by the policy holder and c the policy holder must have known at the time of the making of the statement that it was false or that it suppressed facts which it was material to disclose
When M was treated in 1943 by Dr L he was suffering from serious ailments
He must have known that it was material to disclose this but made a false statement that he had not been treated by any doctor for any serious ailment
There was deliberate suppression fraudulently made by M Even though the Company had got M examined by four doctors before issuing the policy it was not estopped from questioning the policy
It had no means of knowing that M had been treated by Dr L for serious ailments
Held further that the appellant was not entitled even to a refund of the money paid as premium as one of the terms of the policy was that all monies paid belonged to the company if the policy was vitiated by fraudulent suppression of material facts
To such a contract neither section 65 nor section 64 of the Indian Contract had any application