National Insurance Company Limited and Ors. Vs. Sujit Kumar Banerjee - Court Judgment

In The High Court At Calcutta In Appeal from its Constitutional Writ Jurisdiction Original Side APO523of 2014 WP304of 2009 National Insurance Company Limited & ORS.-vs.Sujit Kumar Banerjee With APO521of 2014 WP999of 2009 National Insurance Company Limited & ORS.-vs.Sujit Kumar Banerjee Before Chellur : The Hon’ble The Chief Justice Dr.

Manjula & The Hon’ble Justice Mr.Arijit Banerjee For the appellants : Mr.Ajay Krishna Chatterjee, Sr.Adv.Mr.Abhijit Gangopadhyay, Adv.Mr.Supriya Dubey, Adv.Ms.Shilpi Ganguly, Adv.For the respondents : Mr.Sabyasachi Chowdhury, Adv.Mr.Soumen Datta, Adv.Ms.Soma Kar Ghosh, Adv.Mr.Dhruv Goren, Adv.Heard On : 15.03.2016, 05.04.2016 & 17.05.2016 Judgment On : 09.08.2016 Arijit Banerjee:(1) The abovementioned appeals arise out of two separate judgments and ordeRs.both dated 2 December, 2014, passed by the Learned Single Judge in WP No.304 of 2009 and WP No.999 of 2009.

However, since the said two writ petitions arise out of the same set of facts, the two appeals have been taken up together for hearing and disposal by this common Judgment.

Re: APO523of 2014 (Arising out of 304 of 2009) (2) The respondent is admittedly an agent of the appellant National Insurance Co.LTD.(in short ‘NICL’).The respondent claimed agency commission from NICL for procuring insurance business for the Company.

Admittedly, the respondent acted as a liaison in the capacity of an agent in respect of two insurance policies taken by the Kolkata Police from NICL.

The policies are the Group Personal MediClaim Policy (in short ‘Mediclaim Policy’) and the Group Personal Accident Policy (in short ‘Accident Policy’).The policies are for the benefit of the persons in the employment of the Kolkata Police.

The claim of the respondent is on account of agency commission in connection with the mediclaim policy.

On the refusal of NICL to pay the claimed amount, the respondent filed WP304of 2009 praying for, inter alia, the following reliefs:“(a) A writ of and/or in the nature of Mandamus do issue commanding the respondents to forthwith make payment of commission on all the premium collected under the agency code of the petitioner, being 90000310 till date within such time as this Hon’ble Court may deem fit and proper; (b) A writ of and/or in the nature of Mandamus do issue commanding the respondents to forthwith make payment of commission of the said sum of Rs.1,63,32,947/- as enumerated in annexure ‘P-1’ hereto;” (3) The learned Judge allowed the writ petition.

Hence, this appeal.

Contention of the appellants:(4) Appearing on behalf of the appellants Mr.Ajay Krishna Chatterjee, Learned Sr.Advocate submitted that commission for the accident policy was payable to the respondent and the same was paid in full.

There is no dispute on that account.

However, in respect of mediclaim policy no commission was payable or ever paid to the respondent.

In respect of mediclaim policy, only once in August, 2006, agency commission was erroneously shown for payment to the respondent due to erroneous computer entry but in the very next month the error was rectified by way of correction.

The respondent accepted such correction of error and never objected to it prior to filing of the writ petition in March, 2009.

(5) The mediclaim policy in question is a ‘Tailor Made Policy’ and it is not a medical insurance policy which is normally found in the insurance market.

The terms and conditions, coverage, premium etc of such a policy are separately framed and formulated according to the need and requirement of the policy taker.

It is a group policy and by a single insurance policy a large number of individuals employed by any particular authority are covered.

(6) Learned Senior Counsel submitted that in respect of the mediclaim policy in question, pursuant to the discussion between the Kolkata Police Authority and Officers of NICL, a memorandum of understanding dated 22 July, 2005 was entered into by and between Kolkata Police and NICL recording therein the coverage and conditions of the Policy and the premium payable therefor.

The respondent, as an agent had absolutely no role to play in framing or formulating the terms and conditions and premium of the mediclaim policy.

The mediclaim policy issued by NICL was in the nature of undertaking social responsibilities by a body corporate being a public sector insurance company and a wing of the Union of India.

(7) The premium per police personnel per month was fixed at Rs.37/- for a coverage of Rs.1,00,000/-.

The coverage was, in addition to the employee, also for three additional family members as per his/her choice.

Since the role of the respondent was only liaisoning, it was known and understood by all concerned that in respect of the mediclaim policy no agency commission would be payable.

The policy was a net rate policy and agency commission was not loaded in the premium.

The respondent waived his agency commission in respect of the mediclaim policy and accepted his agency commission against accident policy.

(8) The respondent was fully aware that for the accident policy, he would earn huge agency commission which would enhance his status as an agent and under the same MOU he would not get any agency commission for the mediclaim policy.

The respondent voluntarily waived his right to receive agency commission in connection with the mediclaim policy.

Subsequently, he cannot make a volta facie after four years and claim agency commission in respect of the mediclaim policy.

(9) Mr.Chatterjee then submitted that the conduct of the respondent would show that his claim made in the writ petition is an afterthought.

As per the respondent’s claim, a sum of Rs.3,13,586/- was accumulating as alleged agency commission per month in his favour starting from August, 2005.

However, he made only two representations dated 18 January, 2006 and 29 March, 2006 and, thereafter, kept silent till 21 January, 2009 when he sent an Advocate’s letter to the company claiming agency commission in the sum of Rs.1,63,32,947/- in respect of the mediclaim policy.

Had he been really entitled to receive such agency commission, surely he would not have kept silent and would not have waited for almost four years before filing the present proceedings.

It is unbelievable that if, indeed, the respondent was entitled to receive such huge agency commission in respect of the mediclaim policy, he would keep quiet and only make sporadic demands after lapse of time.

The present application is not a bona fide one.

(10) Learned Counsel submitted that after the writ petition was filed, the Learned Judge gave an opportunity to NICL to respond to the representation of the respondent/his Advocate dated 21 January, 2009 which NICL did by its letter dated 18 May, 2009 denying the entire claim of the respondent.

NICL has always disputed the money claim put forward by the respondent and any adjudication thereof requires proof of a number of factual questions which cannot be conveniently done in a writ application.

(11) It was next submitted that the two insurance policies i.e.the mediclaim policy and the accident policy were issued pursuant to MOU entered into by and between NICL and Kolkata Police.

In the year 2009, at the time of renewal of the policies, NICL proposed to enhance the rate of premium to Rs.1669/- per year per person in respect of the mediclaim policy.

In response, the Kolkata Police by its letter dated 26 June, 2009 requested NICL to reconsider the proposal of enhancement of premium and make it Rs.125/- per month per employee inclusive of all taxes.

In the said letter, the Kolkata Police clearly stated that in respect of the mediclaim policy no agency commission was being incurred by NICL.

As regards the Kolkata Police enjoying the factum of non-addition of agency commission in the premium for the mediclaim policy, the source of such information could only be the respondent.

Under the Insurance Regulatory and Development Authority (Licencing of Insurance Agent) Regulation, 2000 and in particular Regulation 8(1)(i)(d).an insurance agent shall have to disclose the scales of commission in respect of the insurance product offered for sale if asked by the prospecting client.

In this case, the insurance product was the mediclaim policy.

The prospect was the Kolkata Police who took the policy and the letter of the Kolkata Police dated 26 June, 2009 clearly shows that Kolkata Police knew that there was no agency commission in respect of the mediclaim policy.

The respondent must have disclosed to Kolkata Police at some point of time that there was no agency commission involved in the case of mediclaim policy.

Truth in this regard can only come to light by taking evidence of all concerned which cannot be done conveniently in the writ jurisdiction.

(12) Mr.Chatterjee submitted that there are serious disputed questions of fact involved in the present case.

While the respondent claims agency commission in respect of the mediclaim policy, the appellants contend that no such commission was payable to the respondent since the premium payable in respect of the mediclaim policy was structured in a manner so as to give huge coverage without any commission being included in it.

The mediclaim policy was clearly a ‘Net Rate Policy’ and the respondent while receiving huge agency commission in respect of the accident policy voluntarily waived his claim to receive agency commission in respect of the mediclaim policy.

The rival contentions of the parties require evidence to be led by the parties for proper adjudication which can only be done in a regular suit.

(13) Learned Counsel finally submitted that the writ petition has been filed for enforcing a money claim simpliciter.

There is no other prayer in the writ petition excepting the prayer for a mandamus directing the appellants to pay the agency commission claimed by the respondent.

A writ petition to enforce a pure and simple money claim is not maintainable.

In this connection, Learned Counsel relied on a decision of the Hon’ble Supreme Court in the case of Suganmal-vs.-State of Madhya Pradesh, AIR1965SC1740 In particular, reliance was placed on the following observations of the Hon’ble Apex Court:“…………We are of opinion that though the High Courts have power to pass an appropriate order in the exercise of the powers conferred under Art.

226 of the Constitution, such a petition solely praying for the issue of a writ of mandamus directing the State to refund the money is not ordinarily maintainable for the simple reason that a claim for such a refund can always be made in a suit against the authority which had illegally collected the money as a tax.

(para

6) ………………..We therefore hold that normally petitions solely praying for the refund of money against the State by a writ of mandamus are not to be entertained.

The aggrieved party has the right of going to the Civil Court for claiming the amount and it is open to the State to raise all possible defences to the claim, defences which cannot, in most cases, be appropriately raised and considered in the exercise of writ jurisdiction.” (14) Relying upon the above submissions, learned Counsel for the appellants prayed that the appeal be allowed and the judgment and order impugned be set aside.

Contention of the respondent:(15) Appearing on behalf of the respondent Mr.Sabyasachi Chowdhury, Learned Counsel submitted that the respondent is an insurance agent within the meaning of Sec.

2(1) of the Insurance Act, and licensed under Sec.

42 of the said Act.

As such the respondent is entitled to receive payment by way of commission or other remuneration in consideration of his soliciting and procuring business for the Insurance Company.

He is also a registered licence holder under the Insurance Regulatory and Development Authority Act, 1999.

(16) In the year 2005, the respondent brought business from Kolkata Police for the appellant company in respect of two policies, namely the Group Mediclaim Policy and Personal Accident Insurance Policy, both of which became effective from 1 July, 2005.

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