Back
1994 Supreme(SC) 981
SUPREME COURT OF INDIA
S. MOHAN AND G.N. RAY, JJ.
Life Insurance Corporation of India, Appellant
Versus
Vishwanath Verma and others, Respondents.
Civil Appeal No. 6493 of 1994 (arising out of SLP (C) No. 14522 of 1984)
Decided on 30-9-1994.
A.RANGANADHAM CHETTY, A.V.RANGAM, B.Y.Kulkarni, D.N.MUKHERJI, HARISH N.SLAVE, S.K.AGNIHOTRI, S.K.Gambhir
Headnote:
Delhi Municipal Corporation Act, 1957 - Section 283 - Indian Electricity Act, 1910 – Section 21(2) - Constitution of India – Article 14 - Arbitration Act,1940 - Calculation Of The Tariff Amount - Respondent is a consumer of electricity - He had applied for Mixed Load (HT) Connection for non-industrial purposes - Dispute between parties is with respect to calculation of the tariff amount / consumption charges payable by respondent each month - In short, dispute pertains to interpretations of relevant tariff condition in Tariffs notified under (DESU) - Arbitration Act and referring dispute between parties to arbitration - Learned single Judge directed further that pending arbitration proceedings before Arbitrator, consumer shall not be made to deposit disputed amount - It was, however, observed that in case it is ultimately held that consumer is liable to pay said disputed amount, he shall pay same with interest @ 12% p.a. - Held, From decisions of Delhi High Court that its earlier decision was mainly because of said words of " ceiling", when ceiling was removed, it was held that in addition to demand charges energy charges are also payable – Court may reiterate in case of tariff condition applicable to Mixed Load HT, with which we are concerned in these appeals, there are no words of ceiling – Court must, however, hasten to add that we must not be understood as holding or affirming that said words of ceiling to mean that only highest of the two charges (demand charges and energy charges) alone is payable - Reference to arbitration by Delhi High Court in these and other connected matters pertains precisely to interpretation of tariff condition occurring in clauses (c) and (d) applicable to under "Mixed Load HT" category – Since court have answered question on merits, reference to arbitration must be deemed to have become unnecessary and infructuous - Restraint order /stay order passed by High Court pending disposal of arbitration proceedings also falls to ground and is vacated - Learned single Judge and Division Bench of Delhi High Court affirming it which are subject matter of these appeals are set aside - Appellant shall be entitled to their costs - Appellants costs assessed at Rupees 20,000/- consolidated - Appeal Allowed.
JUDGMENT
MOHAN, J.:- Leave granted.
2. Life Insurance Corporation of India is the appellant.
3. The Jabalpur Municipal Corporation formulated a scheme for the benefit of its employees known as Nagar Nigam Karamchari Parivarik Kalyan Yojna. That scheme provided, in the event of death of an employee while in service, a sum of Rs. 10,000/- or Rs. 5,000/- payable to the dependents, depending upon the rate of monthly contribution. If the monthly contribution was Rs. 10/- the amount payable was Rs. 10,000/- and where the monthly contribution was Rs. 5/- the amount payable was Rs. 5,000/-. The scheme was also known as Family Benefit Fund Scheme. It was implemented with effect from 1-6-75 by effecting appropriate monthly deductions from the salaries of the employees. The payment of specified amount in terms of the scheme was also made to the retiring employees as also to the dependents of the employees who died while in service.
4. While the scheme was in operation the question arose as to the validity of the scheme. The Government of Madhya Pradesh examined that question from the perspective whether the said scheme was violative of the provisions of the Life Insurance Corporation Act, 1956 (hereinafter referred to as the Act) or the Insurance Act, 1938. By its order dated 31-3-77 the Government of Madhya Pradesh directed the suspension of the scheme as administered by the Jabalpur Municipal Corporation. However, by order dated 15-2-78 the Government directed till further orders appropriate deductions may be continued from the employees salary. By a Resolution dated 18-8-80 the Municipal Corporation, Jabalpur in order to provide higher benefits to the employees increased the contribution from Rs. 5/-to Rs. 10/- and from Rs. 10/- to Rs. 20/- . The matter was considered in detail. By order dated 16-12-80 the Government of Madhya Pradesh directed the Jabalpur Municipal Corporation to stop the scheme forthwith. The Municipal Corporation was also advised that on receipt of confirmation of withdrawal of scheme opinion could be obtained from the Central Government. Thereafter the matter was considered by the Controller of Insurance who by his letter dated 23rd March, 1981 advised the Secretary, Local Govt. Department, Government of Madhya Pradesh to the following effect:
"No. 81(1)-Ins.11/81
Government of India,
Ministry of Finance,
Department of Economic Affairs,
Insurance Division,
Nirvachan Sadan, Ashok Road.
New Delhi, the 23rd March, 1981.
To,
The Secretary,
Local Govt. Department,
Govt. of Madhya Pradesh.
Subject :-Municipal Corporation Employees Family Benefit Scheme.
Sir,
I am directed to refer to this Ministrys letter of even number dated 3rd March, 1981 on the above subject in response to your letter No. 684/XVIII/ 1/80 dated 7th February, 1981 and to say that in terms of Section 30 of the Life Insurance Corporation Act, 1968, the Life Insurance Corporation of India has the exclusive privilege of carrying on life insurance business except to the extent otherwise expressly provided in the Act. An exception is made in the case of compulsory life insurance schemes for employees of Government, vide Section 44 (f) of the Act reproduced below:-
"44. Nothing contained in this Act shall apply in relation to-
(f) any scheme in existence on the appointed day or say scheme framed after the appointed day with the approval of the Central Government whereby, in consideration of certain compulsory deductions made by Government from the salaries of its employees as part of the conditions of service, the payment of money is assured by Government on the death of the employee concerned or on the happening of any contingency dependent on his life".
This exception is not available to other employers such as local bodies.
Yours faithfully,
Sd/-
For Controller of Insurance."
5. The said order was challenged by an employee of the Municipal Corporation, Jabalpur (the first respondent) and the Jabalpur Corporation Karamchari Sangh (the second Respondent) in Misc. Petition No.
