Paragraph numbers below are the court’s original numbering, recovered from the source text.
39. All mediclaim insurance policies, a proforma whereof has been brought to our notice, contain almost identica! clauses, some of which are:- c 4.0 The Company shall not be liable to make any payment under this policy in respect of any expenses whatsoever incurred by any Insured Person in connection with or in respect of : 4.1 All diseases/injuries which are pre-existing when the ~ ~' cover incepts for the first time. 4.2 Any disease other than those stated in clause 4.3, contracted by the Insured person during the first 30 days from the commencement date of the policy. This exclusion shall not, however, apply if in the opinion of Panel of Medical Practioners constituted by the Company for the purpose, the insured person could not have known of the existence of the Disease of any symptoms or complaints thereof at the time of making the proposal for insurance to the Company. This condition 4.2 shall not however apply in case, of the insured person having been covered under this scheme or group insurance scheme with any of the Indian Insurance companies for a continuous period of preceding 12 months without any break. 4.3 During the first year of the operation of the policy, the expenses on treatment of diseases such as Cataract, Benign Prostatic Hypertrophy, Hysterectomy for Menorrhagia or, Fibromyoma, Fistula anus, Piles, Sinusitis and related disorders are not payable. If ~ .. th~se diseases are Pre-existing at the time of proposal they will not be covered during subsequent period of renewal too. 5.7 The Company shall not be liable to make any pay- ment under the policy in respect of any claim if such claim be in any manner fraudulent or supported by any fraudulent means or device whether by the In- sured Person or by any other person acting on his be.half. c 5.9 The policy may be renewed by mutual consent. The Company shall not however be bound to give notice that its due for renewal and the Company may at any time cancel this. Policy by sending the Insured 30 days notice by registered letter at the insured last known address and in such event the Company shall refund to the Insured a pro-rata premium – for unex- pired Period of Insurance. The Company shall, how- ever, remain liable for any claim which arose prior to the date of cancellation. The Insured may at any time cancel this Policy and in such event the Cpmpany shall allow refund of premium at Company's short period rate only (table given here below) provided no claim has occurred up to the date of cancellation. Period of Risk Rate of Premium to be charged Up to one month Y.. of the annual rate Up to three months 1h of the annual rate Exceeding six months Full annual rate 7. CUMULATIVE BONUS " Sum insured under the policy shall be progressively …. increased by 5% in respect of each claim free year of insurance subject to maximum accumulation of 10 claim free years of insurance. UNITED INDIA INSURANCE CO. LTD. v. MANUBHAI 807 DHARMASINHABHAI GAJERA & ORS. [S.B. SINHA, J.] . .. 7.1 In case of a claim under the policy in respect of A insured person who has earned the cumulative bonus the increased percentage will be reduced by 10% of sum insured at the next renewal. However basic sum insured will be maintained and will not be reduced." CONSTRUCTION OF THE CONTRACT OF INSUR- ANGE:
40. We may, for this purpose, notice a few precedents operating in the field. In New Indian Assurance Co. Ltd. v. Harshadbhai Amrutbhai Modhiya & Anr [(2006) 5 SCC 192], c this Court opined that even in respect of a contract of insur- ance, contracting out may be permissible. In his separate Judg- ment, P.K. Balasubramanian, J. opined: "A contract of insurance is to be construed in the first place from the terms used in it, which terms are themselves D ….. to be understood in their primary, natural, ordinary and popular sense. (See Co/invaux's Law of Insurance, 1h Edn., para 2-01). A policy of insurance has therefore, to be construed like any other contract. On a construction of the contract in question it is clear that the insurer had not E undertaken the liability for interest and penalty, but had undertaken to indemnify the employer only to reimburse the compensation the employer was liable to pay among other things under the Workmen's Compensation Act. Unless one is in a position to void the exclusion clause concerning liability for interest and penalty imposed on the insured on account of his failure to comply with the requirements of the Workmen's Compensation Act of 1923, the insurer cannot be made liable to the insured for those amounts."
41. One important facet of the matter which must also be ,,. ~ taken note of is duty on the part of a State to act fairly. Such a fair dealing is expected at the hands of a State within the mean- ing of Article 12 of the Constitution of India. Strong reliance has been placed by Mr. Parekh on the decision of this Court in Mahabir Auto Stores & Ors. v. Indian Oil Corporation & Ors. …. . [(1990) 3 SCC 752] and Kumari Shrilekha Vidyar1hi & Ors. v State ofU.P & Ors. [(1991) 1SCC212]. There cannot be any doubt whatsoever that Article 14 of the Constitution of India which encompasses within its fold, obligations on the part of the State B to act fairly which operates also in the contractual field but the . said principle would be applicable more in a case where bar- gaining power is unequal or where the contract is not a negoti- ated one and/or is based on the standard form contracts be- tween unequals. Some of these decisions, however, had been c taken into consideration in Asstt. Excise Commissioner. v. Issac Peter [(1994 (4) SCC 104] whereupon strong reliance has been placed by the learned Solicitor General. Therein, inter alia, it was held: "26. Learned Counsel for Respondents then submitted that doctrine of fairness and reasonableness must be read into contracts to which State is a party. It is submitted that the State cannot act unreasonably or unfairly even while acting under a contract involving State power. Now, let us see, what is the purpose for which this argument is addressed and what is the implication? The purpose, as we can see, is that though the contract says that supply of additional quota is discretionary, it must be read as obligatory – at least to the extent of previous year's supplies – by applying the said doctrine. It is submitted that if this is not done, the licencees would suffer monetarily. The other purpose is to say that if the State is not able to so supply, it would be unreasonable on its part to demand the full amount due to it under the contract. In short, the duty to act fairly is sought to be imported into the contract to modify and alter its terms and to create an obligation upon the State which is not there in the contract. We must confess, we are not aware of any such doctrine of fairness or …. reasonableness. Nor could the learned Counsel bring to our notice any decision laying down such a proposition. Doctrine of fairness of the duty to act fairly and reasonably UNITED INDIA INSURANCE CO. LTD. v. MANUBHAI 809 DHARMASINHABHAI GAJERA & ORS. [S.B. SINHA, J.] … ~ is a doctrine developed in the administrative law field to ensure the Rule of Law and to prevent failure of justice where the action is administrative in nature. Just as principles of natural justice ensure fair decision where the function is quasi-judicial, the doctrine of fairness is evolved to ensure fair action where the function is administrative. .._ But it can certainly not be invoked to amend, alter or vary the express terms of the contract between the parties. This is so, even if the contract is governed by statutory provisions, i.e., where it is a statutory contract – or rather more so. It is one thing to say that a contract – every contract c – must be construed re~sonably having regard to its language. But this is not wha! the licencees say. They seek to create an obligation on the other party to the contract, just because it happens to be the State. They are not prepared to apply the very same rule in a converse D – -t case, i.e., where the State has abundant supplies and wants the licencees to lift all that stocks. The licencees will undertake no obligation to lift all those stocks even if the State suffers- loss. This one-sided obligation, in modification of express terms of the contract, in the name of duty to act fairly, is what we are unable to appreciate."
42. A bare perusal of the said decision would show that the same was rendered in the context of contracts entered into between the State and its citizens pursuant to public auction of tenders or by negotiation. Respondents therein sought to get F new term incorporated in the Contract on the specious plea of fairness. The said place was rightly rejected. The fact, however, remains that the ratio in Issac is not applicable to the fact of the present case not because the duty to act fairly on the part of a State has no application in the field of a contract but the same G would not apply for the purpose of alterations or modifications .A~ of a term of contract.
43. Existence of the jurisdiction of the Superior Court of India upon invoking Article 14 of the Constitution as also Sec- lion 23 of the Indian Contract Act to strike down a clause in the (2008] 9, S.C.R. A contract which the court feels to be unconscionable having re- gard to the equal bargaining power of the parties is not in ques- tion but the said provisions would have no application for the purpose of modifications, alterations or additions of a term in the contract. There cannot furthermore be any doubt whatso- B ever that each case must be considered on its own facts which would obviously lead to the conclusion that by reason thereof the Court shall not read into the contract an automatic renewal clause in a contract of insurance if there does not exist any. c
44. This brings us to the question of reading the prospec- tus into the contract of insurance. We do not find that the pro- spectus and contract c.f insurance speak on different terms. T_hey seek to attain the same object. Clause 11 and 13 of the pro- spectus and clauses 5, 9 and other clauses lead to one conclu- sion that the policy is subject to renewal which is dependent D upon the mutual consent of the parties. It is also evident that both the parties have the rights to cancel the insurance policy. If … – it is to be held otherwise, logical corollary would be that even the insured would not be at liberty not to discontinue the insur- ance policy. But herein we are not concerned with such a ques- E tion.
45. Let us, at this stage, consider some of the decisions relating to contracts of insurance. In Pradeep Kumar Jain v. Citi Bank [(1999) 6 SCC 361], this Court distinguished a case of general insurance from that of lifejnsurance, stating : "6. In the case of life insurance policy certain sum agreed to be paid by the insurance company in the event of the death of the insured or a contingency arising as indicated in the policy. The obligation is then on the insured to pay the premiums periodically. There is no other obligation upon him. In the case of a motor vehicle, the risk to be covered is not only in respect of a vehicle but also towards -1"' the injury to others or damage caused to the property arising out of an accident. In such an event, when the policy is renewed or a fresh policy is applied for, an UNITED lNDIA INSURANCE CO. LTD. v. MANUBHAI DHARMASINHABHAI GAJERA & ORS. [S.B. SINHA, J] ' .. ~ application has to be given and it is to be indicated whether A any claim had been made in the previous year or not and to furnish appropriate material as regards the valuation of the vehicle. It can also be made clear as to the nature and extent of the risk covered whether it is only third party or comprehensive or otherwise. The obligation under the Act is only at least to cover third party risk. Thus mere payment of premium could not result in an automatic renewal of the policy. In the circumstances, we find that the appellant also had certain duties to discharge in the matter of obtaining insurance policy and cannot merely put the blame c on the first respondent."
46. As a proposition of law, where a renewal is based on mutual consent, there may be no automatic renewal as has also been held by this Court in Depot Supdt., H.P Corporation Ltd. v. Kolhapur Agricultural Market Committee [(2007) 6 SCC 159] D ~-t but as would be discussed hereinafter, a mediclaim policy where a senior citizen is involved would stand somewhat on a differ- ent footing. It will depend upon the contract entered into between the parties and the statutes operating in the field as also consti- tutional scheme. We do not agree with the submission of the learned Solicitor General that wherever renewal is subject to mutual consent to the parties, a State may at its whims and ca- price refuse to renew.
47. We may, at this juncture, notice a decision of the Su- . preme Court of Ireland whereupon strong reliance has been placed by learned Solicitor General in Gama Foods Ltd. v. Eagle Star Insurance Company [1997 (2) ILRM 193] wherein it was held: 'The plaintiffs say that one must imply a term into the G policies of insurance issued by the defendant to the …. ,.. plaintiffs in this case to the effect that if a policy is cancelled or its renewal is declined the defendant must give their reasons for so doing. Apart from cases where the law implies some terms into certain kinds of contract, whether by statute or by common law (for example sale of goods, hire purchase, landlord and tenant, sale of lands etc.) one can imply a term into a contract only when the implied term gives effect to the true intentions of all the parties to the contract who might be affected by such implied term. The learned trial judge in his judgment in this case which is now reported at [1995] 1 IR 526 at p.532 quoted from the well known dictum of MacKinnon LJ. In Shirlaw v. Southern Foundries (1926) Ltd. (1939] 2 K.B. 206 and I also quote that dictum here:- "Prima facie that which in any contract is left to be implied and need not be expressed is something so obvious that it goes without saying; so that, if, while the parties were making their bargain, an officious bystander were to suggest some express provision for it in their agreement, they would testily suppress D him with a common 'Oh of course!'." Here the evidence before the learned trial judge is quite clearly to the effect that if such a term were sought to be included in the insurance policies at the time when the plaintiffs were seeking insurance the defendant would not have contracted with the plaintiffs at all. If the officious bystander had interrupted in relation to condition 13 of the policies and had asked the defendant "If you do cancel, will you give your reasons for canceling". The defendant's answer would have been an emphatic "No" whereas to imply such a term into the policies the answer would have to be by both parties "Yes, of course" expressed rather testily to discourage the officious bystander from further interrupting. It is also helpful to quote what Pearson LJ. Said in 1973 in Trollope and Coils Ltd. v. North West Metropolitan Regional Hospital Board [1973] 1 OPP 601 at p.609 : "An unexpressed term can be implied if and only if the court finds that the parties must have intended that term to form part of their contract: it is not enough UNITED INDIA INSURANCE CO. LTD. v. MANUBHAI 813 DHARMASINHABHAI GAJERA & ORS. [S.B. SINHA, J.] ,. ~ for the court to find that such a term would have been A adopted by the parties as reasonable men if it had been suggested to them" it must have been a term that went without saying, a term necessary to give business efficacy to the contract, a term which, though tacit, formed part of the contract which the parties made for themselves." …. These basic principles of law preclude the implication of a term into the policies to the effect that in the event of a declinature or cancellation the defendant must state its reasons therefore." c
48. The said decision, therefore, does not rule out the ef- feet of an implied contract. We must, however, place on record that the United Kingdom and Ireland do not have a written con- ~titution. Doctrine of fairness would not be radiant in a contract D in those courts. Decisions rendered in other jurisdictions merely ~ -t have a persuasive and not a binding nature. A foreign law should not be applied when the constitutionalism operating in the coun- tries are different. We have to apply the law keeping in view the equality clause contained in Article 14 of the Constitution of In- dia. It is a heart and soul of our Constitution. -1
49. Even doctrine of equality had not ordinarily been ap- plied in the field of administrative law in England. Keeping in ~:-.." view the advent of human right regime doctrine of equality is now being applied even in administrative law in UK. It is a re- cent trend of the English courts as would appear from the judg- ment of the House of Lords wherein the court refused to draw a distinction in the matter of 'indefinite detention' of a British Citi- zen and a Non-citizen. [See A (FC) & Ors. (FC) v. Secetary of State for the Home Department [2004 UKHL 56]
50. It was furthermore contended that the writ court would >. ~ ordinarily not grant specific performance of a contract even if it is found that there exists a renewal clause or there has been a breach of contract on the part of the appellant. Ordinarily, it is so .. A writ of mandamus shall not issue in case of a breach of H contract. The court shall also not ordinarily issue a writ of man- damus directing a party to perform a specific performance of the contract in exercise of its writ jurisdiction. We. however. would notice that this is the ordinary law as has been held in Hardesh Ores (P) Ltd. v Hede & Co. ((2007) B 5 SCC 614 and Divisional Forest Officer v. Bishwanath Tea Co. Ltd. [(1981) 3 SCC 246]. In Bishwanath Tea Co., this Court had used the word ordinarily. Hardesh was a case arising out of a civil suit. The question which arose therein was as to whether exercise of option by company was for renewal itself sufficient C where the execution of a fresh document is necessary. Section 24A, introduced in 1972 Act, has invited a com- ment by learned Solicitor General that the situation has com- pletely changed. The High Court might have made broad state- D ment that by reason thereof. a State within the meaning Article 12 of the Constitution of India, does not cease to be one but. in our opinion. that is not the point. The point is what would be the effect. Would it mean that two concepts. namely, Article 12 of the Constitution and Section 24A of the 1972 Act are different? If they are not. in a given case. it may be possible to hold that E even while the State shall have more liberty to enter into a con- tract or fix the terms and conditions thereof having regard to the field of competition opened by reason of taking away of its the monopoly status, but there exists a distinction between the acts of a private player and the State.
51. We, however. do not mean to say that even in the field of contract qua contract, the State is not free to negotiate its terms; what we mean to say is that its action cannot be arbi- trary. Role of both are different. A private player, as the law stands G now, may not be bound to comply with the constitutional require- ments of the equality clause, the appellants are.
52. There exists a distinction between a private player in -1- • the field and a public sector insurance company. Whereas a private player in the field is only bound by the statutory regula- ¥1 H lions operating in the field. the public sector insurance compa- UNITED INDIA INSURANCE CO. LTD. v. MANUBHAI 815 DHARMASINHABHAI GAJERA & ORS. [S.S. SINHA, J.] …….. nies are also bound by the directions issued by the General A Insurance Corporation as also the Central Government. They cannot be ignored. The said directions are not said to be in derogation of the statutory provisions. Their validity is not under challenge.
53. We may also notice that the Universal Declaration of B Human Rights states that : "Everyone has right to a standard of living adequate for the health and well-being of himself and his family, including food, clothing, housing and medical care, and necessary c social services, and the right to security in the vent of unemployment, sickness, disability, widowhood, old age, or other lack of livelihood in circumstances beyond his control."
54. The declaration also demands that the member na- 4 i' tions secure the recognition and observance of the said rights. The authority would do well in issuing appropriate direction keep- ing in view the aforementioned human rights and particularly in view of the fact that the Government of India does not provide for any social security by way of compulsory insurance. Unlike the provisions of the Motor Vehicles Act, 1988 such compul- sory insurance does not find a place in any statute book. We, in the aforementioned situation, have strived to strike a balance between the tiuman rights as contained in the Uni- ,.;,.. versa! Declaration of Human. Rights as also the right of a State and others who perform public utility provisions like insurance companies. It is also useful to note that although ordinarily a contract of insurance services would not come within the pur- view of the public utility services, the Legal Services Act, 1987, as amended in 2002, says so in terms of Section 22(b) or 22(c) thereof.
55. We are referring to the aforementioned provisions only with a view to show that whereas attempts are being made to strengthen the control over the insurance sector by creating new [2008) 9 S.C.R. forums which would easily be accessible to the service recipi- ……. ent, the insurance companies having regard to the new policy of the Central Government, in general and under Section 24A of the 1972 Act in particular should not be allowed to make all attempts to frustrate the same. Whereas on the one hand we B cannot forget the new market economy and the Foreign Direct Investment, we also cannot shut our eyes to the ground reali- ties. There is a huge gap between the high sounded wants of the Government and the realities on the ground. It is essential that while on the one hand, the insurance companies are not c put to undue burden keeping in view the changes in the statute as also the policy decisions of the Central Government, they cannot also be permitted to act wholly arbitrarily and unreason- ably. They cannot be permitted to create a social condition which would negate all human rights. We although would not place D medicare and old age being the facets of human rights with abject poverty, but then the gap between the object on the stat- "'" … utes and the action on the part of the players on the field must be taken care of. JUDICIAL REVIEW
56. The action was brought by private individuals. The writ petition, however, had wider ramification. They not only would affect the writ petitions, but also others who would be similarly situated. Such cases may not be dealt with as individual cases. In appropriate case, such litigation may be regarded as public interest litigation. Even if it not so regarded, the High Court may consider G the same to be 'Public Law Litigation' While determining a lis having public law domain, the courts would be entitled to take a broader view. It would not consider to be case involving contract-qua-contract question only. Even cases involving contracts may be determined by the UNITED INDIA INSURANCE CO. LTD. v. MANUBHAI 817 DHARMASINHABHAI GAJERA & ORS. [S.B. SINHA, J.] High Court in exercise of its jurisdiction under Article 226 of the A Constitution of India. (see LIC of India & Anr v. Consumer Edu- cation & Research Centre & Ors. [(1995) 5 SCC 482], Sanjana M. Wig (Ms) v. Hindustan Petroleum Corpn. Ltd. [(2005) 8 SCC 242], ABL International Ltd & Anr v. Export Credit Guarantee Corporation of India Ltd & Ors. [(2004) 3 SCC 553], The D.F 0, South Kheri & ors. v. Ram Sanehi Singh [(1971) 3 SCC 864, Noble Resources Ltd. v. State of Orissa & Anr [(2006) 10 SCC 236]. We, however, do not think that facts involved in each case and the law laid down therein need not be discussed as there does not exist any basic principles therefor. These cases do c not involve serious disputed question of fact. Basic facts are admitted. The High Court was concerned with the interpretation of statute and interpretation of the con- tract. Judicial Review of the impugned action on the part of the D i appellant was, therefore, permissible. APPLICATION OF LAW
57. Keeping in view the aforementioned legal principles, we may notice the fact of each case.
58. The insurer in SLP (C) No.9877entered into a con- tract of mediclaim insurance in 1990 for a sum of Rs.90,0001- from 1992 to 2002. He had been making payments of the pre- miums regularly. His policy had been renewed every year. It was also renewed for the period 4.10.2001 to 3.10.2002. The insured's wife, son and daughter-in-law have also entered into such policy since 1992. Their policies had also been renewed from time to time without any change in terms.
59. On or about 9.9.2002, Respondent No.1 handed over G a cheque for a sum of Rs.6,377/- by way of renewal of insur- ance policy. As no action thereon was taken, a reminder was sent. A legal notice was also issued. The legal notice was re- fused to be accepted by the Divisional Manager. In response thereto, only on 30.9.2002, the appellant stated that the policy H [2d08] 9 S.C.R. would be renewed by loading of 300% premium. A sum of …… Rs.18,982 was deposited. A receipt ~cknowledging the sum of Rs.6,377/- was also issued. Despite issuance of the said sum, the policy was not renewed. Strangely enough, only on October 3, 2002, the appellant stated that the said policy could be re- newed subject to exclusion of the diseases specified therein. It was in the aforementioned situation, the writ petition was filed. …..
60. In SLP (C) No.10205 of 2004, the second respondent, who is a practicing consultant neurologist and physician since 1961, had taken mediclaim insurance for himself his v.'ife and c his family members since 1992-1993. He was diagnosed with Hypogamglobulinemias in August-September 1999. Despite the same, the policy was renewed. By a letter dated 26.7.2002, appellant informed him that his mediclaim policy which was to expire on 13.8.2002 would be renewed subject to the exclusion D of the disease Septicemia with Hypogamglobulinemias and was advised that the next premium will be accepted after load- …. .,. ing of 100% with 5% excess for each and every claim. It is at that juncture, the writ petition was filed.
61. Respondent No.3 in SLP (C) No.10205 of 2004 had taken a mediclaim policy and accident insurance policy in 1988. By a letter dated 15.1.2002, the mediclaim policy for the year 2002-2003 was refused to be renewed and he was asked to renew his policy in another company. The policy was cancelled.
62. We have noticed the judgment of the Gujarat High Court …… in each of these cases.
63. First Respondent in SLP (C) No.1534 of 2006 ap- preached the Delhi High Court when the joint mediclaim policy was refused to be renewed. His claim of Rs. 2, 19,660/- which G he had incurred for undergoing a bye-pass surgery in January 2003 was refused to be paid. He had obtained mediclaim policy in April, 1995. The same had been renewed. He had unde1- gone Angioplasty in July 1998 and again in June 2001. He had undergone a bye-pass surgery in December 2002. Respon- H dent No.1 tendered premium for renewal of the policy in April, .::__ UNITED INDIA INSURANCE CO. LTD. v. MANUBHAI 819 DHARMASINHABHAI GAJERA & ORS. [S.B. SINHA, J.] … _,. 2003 which was declined on the ground of 'high claim ratio in the last three years'.
64. Each of the aforementioned cases clearly shows that the action on the part of the authorities of the appellant was highly arbitrary. Respondents though were not entitled to auto- matic renewal, but indisputably, they were entitled to be treated fairly. We have noticed hereinbefore some of the clauses con- tained in the prospectus as also the insurance policy. When a policy is cancelled, the conditions precedents therefor must be fulfilled. Some reasons therefor must be assigned. When an exclusion clause is resorted to, the terms thereof must be given c effect to. What was necessary is a pre-existing disease when the cover was inspected for the first time. Only because the in- sured had started suffering from a disease, the same would not mean that the said disease shall be excluded. If the insured had made some claim in each year, the insurance company should D -#' … not refuse to renew insurance policies only for that reason. The words 'incepts for the first time' as contained in clause 4.1 as also the words 'continuous and without break' if the renewal pre- mium is paid in time, must be kept in mind as also the reasons for cancellation as contained in clause 7(1 ){n) thereof.
65. Renewal of a medi-claim policy subject to just excep- lions should ordinarily be made. But the same does not mean that the renewal is automatic. Keeping in view the terms and conditions of the prospectus and the insurance policy, the par- ties are not required to go into all the formalities. The very fact that the policy contemplates terms for renewal, subject of course to payment of requisite premium, the same cannot be placed at par with a case of first contract.
66. Having regard to the fact situation obtaining in each G case, we are not inclined to exercise our discretionary jurisdic- t tion under Article 136 of the Constitution of India. Before part- ing with this case, however, we would like to observe that keep- ing in view the role played by the insurance companies, it is essential that the Regulatory Authority must lay down clear guide~· A lines by way of regulations or otherwise.-No doubt, the regula- …_ … tions would be applicable to all the players in the field. The du- ties and functions of the Regulatory Authority, however, are to see that the service provider must render their services keep- ing in view the nature thereof. It will be appropriate if the Central B Government or the General Insurance Companies also issue requisite circulars.
67. Appellants before us being subsidiaries to General Insurance Corporation cannot ignore the statutory provisions. They are bound by the directions issued by the Central Govern- C ment.
68. We would request the IRDA to consider the matter in depth and undertake a scrutiny of such claims so that in the event it is found that the insurance companies are taking re- D course to arbitrary methodologies in the matter of entering into contracts of insurance or renewal thereof, appropriate steps in that behalf may be taken. 68. These appeals are dismissed with costs. Counsel's fee assessed at Rs.25,000/- (Rupees twenty five thousand only) in each case. B.B.B. Appeals dismissed