A company incorporated under the Companies Act is not a statutory body and is not created by the statute.

S.S.SANDHAWALIA, J.

1. Whether the National Insurance Company Limited is "a State" for the purposes of Art.12, or a statutory Corporation amenable to the writ jurisdiction under Article 226 of the Constitution of India, is the somewhat significant question which arises on the very threshold in this writ petition.

2. The issue being pristinely legal, the facts pale into relative insignificance. Suffice it to mention that the petitioner, who is the Branch Manager of the National Insurance Company Limited, claims to be aggrieved by his alleged supersession by officers junior to him and, therefore, invokes Art.16 of the Constitution in his aid. Further a grievance is made about a marginal reduction in his basic salary, which has been labeled as reduction in rank, for which the remedy is sought for in the writ jurisdiction under Art.226 of the Constitution of India.

3. Apart from the merits, a significant preliminary objection to the very maintainability of the writ petition has been raised and strenuously pressed before us. It is claimed that on the admitted facts the National Insurance Company Limited, respondent No. 2, against whom alone, in essence, the relief is claimed, is not amenable to the writ jurisdiction at all. It is the categoric stand that respondent No. 2 neither falls within the ambit of the extended definition of the State under Article 12, nor is it a statutory body or a statutory Corporation against which a writ of the nature claimed on behalf of the petitioner could lie.

4. The matrix of facts on which the preliminary objection is sought to be raised is not in dispute and falls within a narrow compass. The National Insurance Company Limited was incorporated way-back in 1906 and carried on the business of general insurance. Undoubtedly it came within the ambit of a company registered under and governed by the Indian Companies Act, 1956, prior to the enactment of the General Insurance Business (Nationalisation) Act, 1972 , (hereinafter referred to as the 1972 Act ). Therefore, for the purpose of the said Act, the National Insurance Company Limited was an Indian Insurance Company as defined in S.3(i) thereof.

5. Now the core of the argument on behalf of the respondents is this. Admittedly the National Insurance Company Limited prior to 1972 was a Company registered under and governed by the Indian Companies Act, 1956 and despite the enforcement of the 1972 Act, in essence, the same corporate existence and the essentiality of it being a Company under that statute continues unimpaired. It being settled law that an ordinary Company registered under the Companies Act is neither A State nor a statutory corporation for the purposes of Art.226, an identical status is claimed on behalf of respondent No. 2 and the inevitable legal consequence is that no writ would lie against it either.

6. In order to appreciate the aforesaid contention a reference to the legislative history relevant thereto becomes inevitable. It is necessary to recall that the Life Insurance business within the country was nationalised much earlier and in its wake came the Life Insurance Act of the year 1956. However, at that stage the general insurance business was allowed to continue in Private hands, though it is also manifest that the Life Insurance Corporation itself also carried on a substantial general insurance business as well. On a policy decision having been taken by the Government to nationalise the general insurance business also, the General Insurance (Emergency Provisions) Ordinance, 1971 was enacted. This was later followed by an Act of Parliament being the General Insurance (Emergency Provisions) Act, 1971, which was passed with the avowed object of protecting the interests of the policy holders, pending the nationalisation of the general insurance business and to be expedient in public interest. Then followed the primary statute, which falls for consideration, namely the General Insurance Business (Nationalisation) Act of 1972.