The main legal point established in the judgment is the primacy of the Regulations framed under the Life Insurance Corporation of India Act, 1956 in governing the relationship between the Corporation and its agents, and the entitlement of the agent to receive commission after discontinuance of agency, subject to certain conditions.

S.K.Katriar, J.

1. This appeal under Clause 10 of the Letters Patent of the High Court of Judicature at Patna raises a grievance with respect to the order dated 6.5.2004, passed by a learned Single Judge of this Court in C.W.J.C. No. 7736 of 2003 (Manoj Kumar Mannu vs. The Life Insurance Corporation of India and Others), whereby the writ petition has been allowed, and the Life Insurance Corporation of India (the appellant herein) has been directed to make payment of the renewal commission to the writ petitioner (the respondent herein), as per the established procedure. We shall go by the description of the parties occurring in the writ proceedings.

2. A brief statement of facts essential for the disposal of the appeal may be indicated. The writ petitioner was appointed as an agent on probation. with effect from 7.11.1988, by the Branch Manager, Muzaffarpur Branch Office-1, by order dated 30.11.1988 (Annexure-1 series). He was allotted Agency Code No. 04042531. He was in due course confirmed as an agent in terms of Regulation 7(2) of the Life Insurance Corporation of India (Agents) Regulations, 1972 (hereinafter referred to as "the Regulations). After having served for about thirteen years, the petitioner sub- mitted his letter of resignation dated 15.12.2001 (Annexure-A), to the Branch Manager which was really submitted on 20.12.2001. It is relevant to state here that ten days prior to the submission of resignation letter, the petitioner had obtained an advance sum of Rs. 65,000/- from the same Branch for the ostensible purpose of purchase of a motorcycle. The Corporation promptly issued letter dated 28.1.2002 (Annexure-3), to the petitioner, conveying therein that the letter of resignation was pending consideration, and his agents commission in the meanwhile has been stopped. The petitioner was communicated with the impugned order dated 20.2.2003 (Annexure-4/1), whereby it was conveyed to him that his letter of resignation h ad been accepted, and his agents commission was forfeited in terms of sub-section (c) of Section 44 of the Insurance Act, 1938 (hereinafter referred to as the Act). This letter curiously does not mention as to the date with effect from which the letter of resignation was accepted. The aforesaid advance sum of Rs. 65,000/- was adjusted against the dues of the writ petitioner as agents commission. The petitioner, therefore, preferred the present writ petition challenging the order dated 20.2.2003 (Annexure-4/1), whereby he has been deprived of the agents commission. The same has been allowed by the learned Single Judge, wherein it has inter alia been held that the petitioners case is covered by Regulation 19(1)(b) of the Regulations, and not Section 44(1)(c) of the Act.

3. Learned counsel for the Corporation submits that the learned Single Judge has erred in holding that the petitioners case is covered by Regulation 19 of the Regulations, and not Section 44 of the Act. He next submits that the petitioner is guilty of fraud who had mislead the Corporation by taking an advance sum of Rs. 65,000/- in a situation where he had sub- mitted his resignation letter dated 15.12.2001 (which was really handed over on 20.12.2001). He was fully aware that he was going to submit his letter for cessation of his agency notwithstanding which he had withdrawn the money. He relies on the observations of a Division Bench of this Court in the case of Sukhamoy Maitra vs. Emperor, reported in A.I.R. 1938 Patna 165 (at page 169, left hand column).

4. Learned counsel for the petitioner has supported the order of the learned Single Judge.

5. We have perused the materials on record and considered the submissions of learned counsel for the parties. The Insurance Act, 1938 (4 of 1938) was brought on the statute book on 26.2.1938, and was enforced with effect from 1.7.1939 in terms of Section 1(3) of the Act to consolidate and amend the law relating to the business of insurance. The Act governed the entire range of business of i