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IN THE HIGH COURT OF JUDICATURE AT CALCUTTA
Dr. Manjula Chellur & Mr. Arijit Banerjee, JJ.
National Insurance Company Limited & Ors. - Appellants
Vs.
Sujit Kumar Banerjee - Respondents
APO 523 of 2014 WP 304 of 2009 With APO 521 of 2014 WP 999 of 2009
Decided On : 09-08-2016
INSURANCE - AGENCY COMMISSION - MEDICLAIM POLICY - CLAIM FOR AGENCY COMMISSION ON MEDICLAIM POLICY - VALIDITY OF IRDA CIRCULAR - MAINTAINABILITY OF WRIT PETITION - JURISDICTION OF WRIT COURT TO ENTERTAIN DISPUTED QUESTIONS OF FACT - WAIVER OF RIGHT TO COMMISSION.
Fact of the Case:
The respondent, an insurance agent, claimed agency commission from the appellant insurance company for procuring insurance business for the company. The claim was in respect of two insurance policies taken by the Kolkata Police from the appellant company, namely, the Group Personal Medi-Claim Policy (Mediclaim Policy) and the Group Personal Accident Policy (Accident Policy). The appellant company denied the respondent's claim for commission on the Mediclaim Policy, contending that no commission was payable or ever paid to the respondent in respect of the said policy. The respondent filed a writ petition challenging the appellant's refusal to pay the claimed commission.
Finding of the Court:
The court held that the respondent was entitled to receive commission in respect of the Mediclaim Policy. The court found that the Mediclaim Policy was routed through the respondent and that the policy mentioned the agency code of the respondent on the face of it. The court also noted that there was no endorsement on the policy indicating that the insured was getting benefit of special discount in lieu of agency commission, as required by Clause 3(b) of the IRDA Circular dated 22 February, 2005. The court further held that the appellant company's reliance on the said Circular was misplaced as the same was not applicable to the kind of Mediclaim Policy involved in the case.
Issues: 1. Whether the respondent was entitled to receive commission in respect of the Mediclaim Policy? 2. Whether the IRDA Circular dated 22 February, 2005 was applicable to the Mediclaim Policy in question? 3. Whether the writ petition was maintainable?
Ratio Decidendi: 1. The respondent was entitled to receive commission in respect of the Mediclaim Policy as the policy was routed through the respondent and the policy mentioned the agency code of the respondent on the face of it. 2. The IRDA Circular dated 22 February, 2005 was not applicable to the Mediclaim Policy in question as the policy was a non-tariff business and there was no endorsement on the policy indicating that the insured was getting benefit of special discount in lieu of agency commission. 3. The writ petition was maintainable as the appellant company had absolutely no defence to the respondent's claim and the facts of the case warranted interference of the writ court for doing complete justice.
Final Decision: The appeals filed by the appellant insurance company were dismissed with costs.
Arijit Banerjee, J.
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: APO 523 of 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 Medi-Claim 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 WP 304 of 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
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