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2011 Supreme(Ori) 345

2012 (I) OLR - 343
HIGH COURT OF ORISSA
V. GOPALA GOWDA, C.J. AND B.N. MAHAPATRA, J.
Srikanta Mohapatra - Petitioner
Versus
Life Insurance Corporation of India and two others - Opp. Parties
W.P. (C) No.9307 of 2008
Decided on: 14.11.2011

Headnote:LIC OF INDIA (AGENTS) REGULATIONS, 1972 - Reg. 19(1)(b) - Insurance Act - Sec. 44(1)(c) - Release of renewal commission of the premium received in respect of the business secured as a agent of the corporation - Petitioner was working as an agent of the Corporation from the year 1988 till around February, 2005 He terminated his agency with the Corporation - Held, stand taken by the Insurance Company that the petitioner is not entitled for the commission amount for the period he has claimed under Sec. 44(1)(c) and Reg. 19(1)(b) is not correct - Petitioner has made out a case as he is entitled to get monetary benefits with interest - Rule nisi issued - Direction that amount due towards commission the petitioner is entitled, the same shall be calculated and paid with interest @ 6% - Further direction issued. (Paras - 5 to 7)

ORDER

1. The petitioner who was a Commission Agent of opposite party No.1 at Balasore branch is before this Court seeking for issuance of a writ of mandamus to the opposite parties directing them to release the renewal commission of the premium received in respect of the business secured by him as a agent of the Corporation as per the LIC of India (Agents) Regulations, 1972 urging various facts and legal contentions.

2. The relevant facts stated by the petitioner reads thus:-

The petitioner joined as a Commissioner Agent in LIC of India in its Balasore Branch under Cuttack Division in the month of December, 1988 and was allotted Agency Code No.3113-596 and Insurance License No.1498639 granted by the Insurance Regulatory Development Authority. However, after having worked tirelessly for more than 17 years, the petitioner found himself physically and mentally weakened and unable to effectively work as before for which he decided to quit the agency and accordingly, he resigned from his agency around February, 2005. Further case of the petitioner is that at the time of termination of his agency, the petitioner has rendered service to the Corporation for nearly 17 years and had procured business worth Rs.35,40,000/- out of which policies having sum assured to the tune of Rs.25,00,000/- were still in force. As such, as per Regulation 19(1)(b) of the LIC of India (Agents) Regulations, 1972, the petitioner is entitled to commission on the premiums received in respect of business secured by him. In view of the aforementioned Regulation, the petitioner is entitled to receive an amount of approximately Rs.3,00,000/- towards renewal commission from the Corporation for the period from February, 2005 to February, 2008. It is stated that the petitioner has submitted a representation to the opposite party No.1 on 8.8.2007 praying for passing necessary orders for release of the renewal commission and while doing so, the petitioner highlighted his difficulties in detail for consideration of opposite party No.1. The petitioner also submitted a representation addressed to opposite party No.3 with prayer for issuing necessary direction to the opposite party No.1 with regard to payment of Commission amount. The petitioner in his representation had categorically stated the hardship faced by him due to non-release of renewal commission. Since opposite party Nos.1 to 3 did not respond to the representation despite it was brought to the notice of the opposite parties that petitioner is facing severe financial hardship, he was constrained to serve a lawyer's notice on opposite party No.2 on 12.12.2008 calling upon him to release the outstanding agent's commission within seven days failing which he would seek appropriate legal remedy for redressal of his grievance. Pursuant to the lawyer's notice under Annexure-2 having been received by opposite party No.2 on 14.2.2008, the petitioner received a reply dated 16.2.2008 addressed to his lawyer intimating him that as the petitioner had left the Corporation for procuring life insurance business for Bajaj Allianz Life Insurance Company, therefore, release of his renewal commission had been stopped in accordance with Section 44(1) (c) of the Insurance Act, 1938 since the termination of his contract with the LIC of India is at the instance of the petitioner and at the time of termination the petitioner has served the insurer continuously and exclusively for at least ten years as commission agent. Section 44(1) (c) of the Insurance Act, 1938 enables the petitioner to get premium commission during the period for which he has got secured policy to the Insurance Company towards his business. He has also placed strong reliance upon the Regulation 19(1)(b) of the LIC of India (Agents) Regulations, 1972 which provides the payment of commission on discontinuance of agency. Regulation 19(1)(b) of the Regulation specifically provides for payment of the commission if the agent has continually worked as an agent for at least


















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