Madras High Court
P.Soundara Rajan vs The Union Of India
W.P.(MD)No.10110 of 2015
BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT
DATED: 2 5 . 0 2 . 2 0 2 0
CORAM:
T H E HO N O U R A B L E MR. J U S T I C E A. P. S A HI, C HI E F J U S T I C E
A ND
T H E HO N O U R A B L E MR. J U S T I C E S U B R AMO NIUM P R A S A D
W. P.(MD)N o. 1 0 1 1 0 o f 2 0 1 5
and
M. P.(MD)N o s . 2 t o 4 o f 2 0 1 5
1.P.Soundara Rajan
2.T.M.Renganathan
3.B.Suresh Kumaran
4.S.Mohammed Meerasha
5.A.Sahaya Stephen
6.A.Rakesh
7.R.Monikandanathan
8.J.John Arul
: Petitioners
Vs.
1.The Union of India,
Rep. by its Secretary,
Ministry of Finance,
Department of Financial Services,
3rd Floor Jeevandeep Building,
Sansad Marg, New Delhi 110 001.
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W.P.(MD)No.10110 of 2015
2.The Insurance Regulatory and
Development Authority,
Represented by its Chairman,
Parishram Bhavan,
3rd Floor, Basheer Bagh,
Hyderabad 500 004.
3.The Deputy Director,
The Insurance Regulatory and
Development Authority,
Parishram Bhavan,
3rd Floor, Basheer Bagh,
Hyderabad 500 004. : Respondents
P R AY E R : Writ Petition filed under Article 226 of the Constitution of India, to
issue a writ of declaration declaring Section 64 UM of the Insurance Act, 1938,
as amended by Section 82 of the Insurance Laws (Amendment) Act, 2015, (Act. 5
of 2015) to be ultra vires the Constitution of India and therefore void.
For petitioners : Mr.M.Ajmal Khan
Senior Counsel
for
M/s.Ajmal Associates
For R-1 : Mr.S.Jeyasingh
For R-2 and R-3 : Mr.Anwar Sameem
for
Mr.T.Antony Arul Raj
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W.P.(MD)No.10110 of 2015
O R DE R
**************
[Judgment of the Court was delivered by
S U B R A M O N IU M P R A S A D , J . ]
This writ petition seeks to challenge the vires of Section 64 UM of the
Insurance Act, 1938, as introduced by the Insurance Laws (Amendment) Act,
2015 (Act No.5 of 2015) to be ultra vires the Constitution of India and therefore
void.
2.The writ petitioner is a loss Assessor. The Insurance Act, 1938, was
amended by Act 5 of 2015 whereby Section 64 UM of the Act was introduced
which prescribes that no person shall act as a Surveyor or Loss Assessor in
respect of General Insurance business unless he possess such academic
qualifications as may be specified by the Regulations to be made under the
Insurance Act, 1938. The said Section also prescribes that apart from having the
educational qualification, the Loss Assessor / Surveyor should also be a member
of a professional body of surveyors and Loss Assessors, namely the Indian
Institute of Insurance Surveyors and Loss Assessors.
3.The challenge in this Section is primarily on the ground that it gives
unbridled and uncanalized power to the authorities to frame Regulations
regarding the academic qualification. The submission therefore is that in the
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W.P.(MD)No.10110 of 2015
absence of any guidelines prescribed under the Section 64 UM which gives
unbridled power to the Government to frame Regulation laying down
qualification suffers from the vice of excessive delegation. Apart from that, it
also takes away the rights of existing Surveyors and Loss Assessors who would
not be able to continue to function after the framing of the Regulation unless
they possess the requisite qualification. At this juncture, it is pertinent to
mention that when the writ petition was filed, the Regulations stipulating the
educational qualifications had not yet come into force.
4.By a notification dated 30.10.2015 the Insurance Regulatory and
Development Authority of India (Insurance Surveyors and Loss Assessors)
Regulations came into force. The said Regulations laid down the educational
qualifications which a Surveyor or Loss Assessor had to possess to performing
the work of a Surveyor or Loss Assessor. The said notification also laid down
that all those Surveyors and Loss Assessors who are not complaint with the
requirements stipulated in Section 64 UM of the Act, have to become complaint
within a period of three years from the date of notification of the Regulations
failing which, their licence shall cease to be valid automatically. These
Regulations have not been challenged.
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W.P.(MD)No.10110 of 2015
5.Heard the learned counsel for the parties.
6.The purpose of bringing the Insurance Laws (Amendment) Act, 2015,
was to remove archaic and redundant provisions in the legislations and to
incorporate provisions to provide Insurance Regulatory and Development
Authority of India (IRDAI) with the flexibility to discharge its functions more
effectively and efficiently. The Act was also brought in to regulate the functions,
code of conduct, etc., of surveyors and loss assessors. To achieve the above
mentioned object, which is to regulate the functions and Code of conduct of
Surveyor and Loss Assessors, Section 64 UM of the Act, was brought which
gives power to the Insurance Company to lay down the qualifications of
Surveyors and Loss Assessors. The importance of Surveyors and Loss Assessor in
the field of Insurance to assess the loss suffered by the insured which is the
foundation of a claim cannot be ignored. The legislature was therefore, well
within its rights to prescribe the qualifications which a Surveyor or Loss Assessor
must possess. So that there is uniformity in the performance and nature of work
done by the Surveyors and Loss Assessors. It is well settled that legislature can
prescribe qualifications which must be possessed by Surveyor or Loss Assessor
before granting a licence to a person to perform the work of a Surveyor or Loss
Assessor. It is this power to lay down the prescription, which has been exercised
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W.P.(MD)No.10110 of 2015
by the Parliament for fixing the Educational qualifications for discharging the
role of a Surveyor or Loss Assessor in any Insurance Company. The relevant
provisions of Section 64 UM of the Insurance Act,1928, and the Regulation,
which are necessary for adjudication of the present dispute read as under:-
“64 U M . Li c e n si n g o f s u r v e y o r s a n d lo s s a s s e s s o r s.—
(1) (A ) S a v e a s ot h e r wi s e p r o vi d e d in thi s s e c ti o n , n o
p e r s o n s h all a ct a s a s u r v e y o r o r lo s s a s s e s s o r in r e s p e c t o f
g e n e r al in s u r a n c e b u si n e s s aft e r th e e x piry o f a p e ri o d o f o n e y e a r
fr o m th e c o m m e n c e m e nt o f th e In s u r a n c e ( A m e n d m e nt) A c t , 1968 ,
u nl e s s h e h ol d s a v alid lic e n c e i s s u e d t o hi m b y th e 1[ A ut h ority].
( B ) E v e ry p e r s o n w h o int e n d s t o a ct a s a s u r v e y o r, o r
lo s s a s s e s s o r aft e r th e e x piry o f a p e ri o d o f o n e y e a r fr o m th e
c o m m e n c e m e nt o f th e In s u r a n c e ( A m e n d m e nt) A c t , 1968 2[ b ut
b e f o r e th e c o m m e n c e m e nt o f th e In s u r a n c e R e g ul at or y a n d
D e v el o p m e nt A ut h ority A c t , 1999], s h all m a k e a n a p pli c ati o n t o th e
1[ A ut h ority] within s u c h ti m e , in s u c h f or m , in s u c h m a n n e r a n d o n
p a y m e nt o f s u c h f e e , n ot e x c e e di n g r u p e e s t w o h u n d r e d a n d fifty,
a s m a y b e p r e s c ri b e d . 2[( B A ) E v e r y p e r s o n w h o int e n d s t o a ct a s a
s u r v e y o r o r lo s s a s s e s s o r aft e r th e e x piry o f a p e ri o d o f o n e y e a r
fr o m th e c o m m e n c e m e nt o f th e In s u r a n c e R e g ul at or y a n d
D e v el o p m e nt A ut h ority A c t , 1999 , s h all m a k e a n a p pli c ati o n t o th e
A ut h ority within s u c h ti m e , in s u c h m a n n e r a n d o n p a y m e nt o f s u c h
f e e a s m a y b e d e t e r mi n e d b y th e r e g ul ati o n s m a d e b y th e
A ut h ority: P r o vi d e d th at a n y lic e n c e i s s u e d i m m e di at ely b e f o r e th e
c o m m e n c e m e nt o f th e In s u r a n c e R e g ul at or y a n d D e v el o p m e nt
A ut h ority A c t , 1999 s h all b e d e e m e d t o h a v e b e e n i s s u e d in
a c c o r d a n c e wit h th e r e g ul ati o n s p r o vi din g f or s u c h lic e n c e .]
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W.P.(MD)No.10110 of 2015
( C ) E v e r y lic e n c e i s s u e d u n d e r thi s s e c ti o n s h all r e m ai n
in f or c e , u nl e s s c a n c e ll e d e a rli er, f or a p e ri o d o f fiv e y e a r s fr o m th e
d at e o f i s s u e th e r e o f, a n d m a y b e r e n e w e d f or a p e ri o d o f fiv e
y e a r s at a ti m e , o n p a y m e nt o f s u c h f e e , n ot e x c e e di n g r u p e e s t w o
h u n d r e d , 3[a s m a y b e d e t e r mi n e d b y th e r e g ul ati o n s].
( D) N o lic e n c e t o a ct a s a s u r v e y o r o r lo s s a s s e s s o r s h all
b e i s s u e d u nl e s s —
(i) th e a p pli c a nt, w h e r e h e i s a n in divid u al, s ati sfi e s th e
4[ A ut h ority] th at h e— 5[( a) h a s b e e n in p r a cti c e a s a s u r v e y o r o r
lo s s a s s e s s o r o n th e d at e o f c o m m e n c e m e nt o f th e In s u r a n c e
R e g ul at or y a n d D e v e l o p m e nt A ut h ority A c t , 1999 , o r]
( b) h ol d s a d e g r e e o f a r e c o g niz e d U ni v e r sity in a n y
b r a n c h o f e n gi n e e rin g , o r
( c) i s a f ell o w o r a s s o ci at e m e m b e r o f th e In stitut e o f
C h art e r e d A c c o u nt a nt s o f In di a o r th e In stitut e o f C o s t a n d W o r k s
A c c o u nt a nt s o f In dia , o r
( d) p o s s e s s e s a ct u arial q u alific ati o n s o r h ol d s a d e g r e e
o r di pl o m a o f a n y r e c o g niz e d U ni v e r sity o r in stitut e in r el ati o n t o
in s u r a n c e , o r
( e ) h o ld s a di pl o m a in in s u r a n c e g r a nt e d o r r e c o g niz e d
b y th e G o v e r n m e nt , o r
(f) p o s s e s s e s s u c h ot h e r t e c h ni c al q u alifi c ati o n s a s m a y
b e 6[ s p e cifi e d b y th e r e g ul ati o n s m a d e b y th e A ut h ority], a n d
( g ) d o e s n ot s u ff e r fr o m a n y o f th e di s q u alific ati o n s
m e nti o n e d in s u b- s e c ti o n (4) o f s e c ti o n 42;
(ii) the a p pli c a nt , w h e r e h e i s a c o m p a n y o r fir m , s ati sfi e s
th e 3[ A ut h ority] th at all hi s dir e ct or s o r p art n e r s , a s th e c a s e m a y
b e , p o s s e s s o n e o r m o r e o f th e q u alific ati o n s s p e cifi e d in cl a u s e (i)
a n d n o n e o f s u c h dir e ct or s o r p art n e r s s u ff e r fr o m a n y o f th e
di s q u alifi c ati o n s m e nti o n e d in s u b - s e c ti o n (4) o f s e c ti o n 42.
( E ) E v e r y a p pli c ati o n f or th e r e n e w al o f th e lic e n c e s h all
b e m a d e at l e a s t thirty d a y s b e f o r e th e e x piry o f th e p e ri o d o f
v alidity th e r e o f.
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W.P.(MD)No.10110 of 2015
( F ) T h e 3[ A ut h ority] m a y, if h e i s s ati sfi e d th at a n y lic e n c e
i s s u e d o r r e n e w e d u n d e r thi s s e c ti o n h a s b e e n lo st o r d e s tr o y e d ,
i s s u e a d u pli c at e lic e n c e o n p a y m e nt o f a f e e o f r u p e e s fiv e a n d
th e d u pli c at e lic e n c e s o i s s u e d s h all r e m ai n in f or c e f or th e
r e m ai n d e r o f th e p e ri o d o f v alidity o f th e lic e n c e in li e u o f w hi c h it i s
i s s u e d.
( G ) W it h o ut p r ej u di c e to th e p ow er s c o nf err e d by
s u b - s e c ti o n (7), th e 3[ A ut h ority], if s a ti sfi e d th at th e h ol d e r o f a n y
lic e n c e h a s m a d e a s t at e m e nt w hi c h i s fal s e in m a t e ri al p arti c ul ar s
with r e g a r d t o hi s e li gi bility f or o bt ainin g s u c h lic e n c e o r h a s , aft e r
th e i s s u e o r r e n e w al o f s u c h lic e n c e , a c q uir e d a n y o f th e
di s q u alifi c ati o n s m e nti o n e d in s u b - s e c ti o n (4) o f s e c ti o n 42 , m a y,
aft e r gi vin g a r e a s o n a bl e o p p ort u nity t o th e h ol d e r o f s u c h lic e n c e
o f b e i n g h e a r d , b y o r d e r c a n c e l s u c h lic e n c e a n d n otify s u c h
c a n c ell ati o n in th e O ffi ci al G a z e tt e . 7[(1 A ) E v e r y s u r v e y o r a n d lo s s
a s s e s s o r s h all c o m ply wit h th e c o d e o f c o n d u ct in r e s p e c t o f th eir
d uti e s , r e s p o n si biliti e s a n d o t h e r p r of e s s i o n al r e q uir e m e nt s a s m a y
b e s p e cifi e d b y th e r e g ul ati o n s m a d e b y th e A ut h ority.]
(2) N o cl ai m in r e s p e c t o f a lo s s w hi c h h a s o c c urr e d in
In di a a n d r e q uirin g t o b e p ai d o r s e ttl e d in In di a e q u al t o o r
e x c e e di n g t w e nt y th o u s a n d r u p e e s in v al u e o n a n y p oli c y o f
in s u r a n c e , ari sin g o r inti m at e d t o a n in s u r e r at a n y ti m e aft e r th e
e x piry o f a p e ri o d o f o n e y e a r fr o m th e c o m m e n c e m e nt o f th e
In s u r a n c e ( A m e n d m e nt) A ct , 1968 , s h all, u nl e s s o t h e r wi s e dir e ct e d
b y th e 8[ A ut h ority], b e a d mitt e d f or p a y m e nt o r s e ttl e d b y th e
in s u r e r u nl e s s h e h a s o bt ain e d a r e p ort, o n th e lo s s th at h a s
o c c ur r e d , fr o m a p e r s o n w h o h ol d s a lic e n c e i s s u e d u n d e r thi s
s e c ti o n t o a ct a s a s u r v e y o r o r lo s s a s s e s s o r ( h e r e aft e r r e f e r r e d t o
a s “ a p pr o v e d s u r v e y o r o r lo s s a s s e s s o r”) : P r o vi d e d th at n ot hin g in
thi s s u b - s e c ti o n s h all b e d e e m e d t o ta k e a w a y o r a brid g e th e rig ht
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W.P.(MD)No.10110 of 2015
o f th e in s u r e r t o p a y o r s e ttl e a n y cl ai m at a n y a m o u nt diff e r e nt
fr o m th e a m o u nt a s s e s s e d b y th e a p p r o v e d s u r v e y o r o r lo s s
a s s e s s o r.
(3) T h e 8[ A ut h ority] m a y, at a n y ti m e , in r e s p e c t o f a n y
cl ai m o f th e n at ur e r e f e r r e d t o in s u b - s e c ti o n (2), c all f or a n
in d e p e n d e nt r e p ort fr o m a n y ot h e r a p p r o v e d s u r v e y o r o r lo s s
a s s e s s o r s p e cifi e d b y 9[it] a n d s u c h s u r v e y o r o r lo s s a s s e s s o r s h all
fur ni s h s u c h r e p ort t o th e 8[ A ut h ority] within s u c h ti m e a s m a y b e
s p e cifi e d b y th e 8[ A ut h ority] o r if n o ti m e li mit h a s b e e n s p e cifi e d
b y 9[it] wit hin a r e a s o n a bl e ti m e a n d th e c o s t o f, o r in ci d e nt al t o
s u c h r e p ort s h all b e b o r n e b y th e in s ur e r.
(4) T h e 8[ A ut h ority] m a y, o n r e c e i pt o f a r e p ort r e f e rr e d t o
in s u b - s e c ti o n (3) , i s s u e s u c h dir e cti o n s a s it m a y c o n s i d e r
n e c e s s a r y with r e g a r d t o th e s e ttl e m e nt o f th e cl ai m in clu din g a n y
dir e cti o n t o s e ttl e a cl ai m at a fig ur e l e s s th a n , o r m o r e th a n , th at at
w hi c h it i s p r o p o s e d t o s e ttl e it o r it w a s s e ttl e d a n d th e in s u r e r
s h all b e b o u n d t o c o m ply with s u c h dir e cti o n s : P r o vi d e d th at w h e r e
th e 8[ A ut h ority] i s s u e s a dir e cti o n f or s e ttlin g a cl ai m at a fig ur e
lo w e r th a n th at at w hi c h it h a s alr e a d y b e e n s e ttl e d , th e in s ur e r
s h all b e d e e m e d t o c o m ply with s u c h dir e cti o n if h e s a ti sfi e s th e
8[ A ut h ority] th at all r e a s o n a bl e s t e p s , with d u e r e g a r d t o th e
q u e s ti o n w h e t h e r th e e x p e n ditur e inv ol v e d i s n ot di s p r o p orti o n at e
t o th e a m o u nt r e q uir e d t o b e r e c o v e r e d , h a v e b e e n ta k e n wit h d u e
d e s p at c h b y hi m : P r o vi d e d furth e r th at n o dir e cti o n f or th e p a y m e nt
o f a l e s s e r s u m s h all b e m a d e w h e r e th e a m o u nt o f th e cl ai m h a s
alr e a d y b e e n p ai d a n d th e 8[ A ut h ority] i s o f o pi ni o n th at th e
r e c o v e r y o f th e a m o u nt p ai d in e x c e s s w o ul d c a u s e u n d u e
h ar d s hi p t o th e in s ur e d : P r o vi d e d al s o th at n ot hin g in thi s s e c ti o n
s h all r eli e v e th e in s u r e r fr o m a n y lia bility, ci vil o r c ri min al, t o w hi c h
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h e w o ul d h a v e b e e n s u bj e ct b ut f or th e p r o vi si o n s o f thi s
s u b - s e c ti o n.
(5) N o in s u r e r s h all, aft e r th e e x piry o f a p e ri o d o f o n e
y e a r fr o m th e c o m m e n c e m e nt o f th e In s u r a n c e ( A m e n d m e nt) A ct ,
1968 , p a y t o a n y p e r s o n a n y f e e o r r e m u n e r ati o n f or s u r v e yi n g ,
v e rifyin g o r r e p ortin g o n a cl ai m o f lo s s u n d e r a p oli c y o f in s u r a n c e
u nl e s s th e p e r s o n m a ki n g s u c h s u r v e y, v e rifi c ati o n o r r e p ort i s a n
a p p r o v e d s u r v e y o r o r lo s s a s s e s s o r.
(6) W h e r e , in th e c a s e o f a cl ai m o f l e s s th a n t w e nt y
th o u s a n d r u p e e s in v al u e o n a n y p oli c y o f in s u r a n c e it i s n ot
p r a cti c a bl e f or a n in s u r e r t o e m pl o y a n a p p r o v e d s u r v e y o r o r lo s s
a s s e s s o r with o ut in c urrin g e x p e n s e s di s p r o p orti o n at e t o th e
a m o u nt o f th e cl ai m , th e in s ur e r m a y e m pl o y a n y o t h e r p e r s o n ( n ot
b e i n g a p e r s o n di s q u alifi e d f or th e ti m e b e i n g f or b e i n g e m pl o y e d
a s a s u r v e y o r o r lo s s a s s e s s o r ) f or s u r v e yi n g s u c h lo s s a n d m a y
p a y s u c h r e a s o n a bl e f e e o r r e m u n e r ati o n t o th e p e r s o n s o
e m pl o y e d a s h e m a y thin k fit.
(7) If th e 10[ A ut h ority] i s s ati sfi e d th at a n a p p r o v e d
s u r v e y o r o r lo s s a s s e s s o r h a s b e e n g uilty o f wilfully m a ki n g a fal s e
s t at e m e nt k n o wi n g it t o b e fal s e o r o f b e i n g k n o wi n gly a p arty t o
th e s e ttl e m e nt o f a cl ai m in a fra u d ul e nt m a n n e r, h e m a y, aft e r
gi vin g s u c h s u r v e y o r o r lo s s a s s e s s o r a n o p p ort u nity o f b e i n g
h e a r d , c a n c e l th e lic e n c e i s s u e d t o hi m with e ff e ct fr o m s u c h d at e
a s m a y b e s p e cifi e d b y hi m a n d s h all n otify s u c h c a n c e ll ati o n in th e
O ffi ci al G a z e tt e.
(8) A n y s u r v e y o r o r lo s s a s s e s s o r w h o s e lic e n c e h a s
b e e n c a n c e ll e d s h all n ot b e e li gi bl e f or h a vi n g a lic e n c e t o a ct a s a
s u r v e y o r o r lo s s a s s e s s o r f or a p e ri o d o f thr e e y e a r s fr o m th e d at e
o n w hi c h th e c a n c ell ati o n i s n otifi e d in th e O ffi ci al G a z e tt e.
(9) T h e 10[ A ut h ority] m a y, in r e s p e c t o f a n y cl ai m o f
v al u e o f l e s s th a n t w e nt y th o u s a n d ru p e e s o n a n in s u r a n c e p oli c y,
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if th e cl ai m h a s n ot b e e n o r i s n ot p r o p o s e d t o b e r e p ort e d u p o n b y
a s u r v e y o r o r lo s s a s s e s s o r, dir e ct th at s u c h cl ai m s h all b e
r e p ort e d u p o n b y a n a p p r o v e d s u r v e y o r o r lo s s a s s e s s o r a n d
w h e r e th e 10[ A ut h ority] m a k e s s u c h dir e cti o n , th e p r o vi si o n s o f
s u b - s e c ti o n s (3) a n d (4) s h all a p ply in r e s p e c t o f s u c h cl ai m.
(10) W h e r e , in r el ati o n t o a n y cl a s s o f cl ai m s , th e
11[ A ut h ority] i s s ati sfi e d th at it i s c u s t o m a r y t o e ntr u st th e w o r k o f
s u r v e y o r lo s s a s s e s s m e nt t o a n y p e r s o n ot h e r th a n a lic e n s e d
s u r v e y o r o r lo s s a s s e s s o r, o r it i s n ot p r a cti c a bl e t o m a k e a n y
s u r v e y o r lo s s a s s e s s m e n t , it m a y, b y a n o r d e r p u bli s h e d in th e
O ffi ci al G a z e tt e , e x e m p t s u c h cl a s s o f cl ai m s fr o m th e o p e r ati o n o f
thi s s e c ti o n.]”
7.Regulation 3 (2) (a) reads as under:-
3. Application for, and matters relating to, grant of license to
individual Surveyors and Loss Assessors.-
(1)........
(2) Eligi bility C rit eria
( a) Q u alifi c ati o n s :
(i) a c a d e mic / t e c h ni c al/ p r of e s s i o n al/In s u r a n c e
Q u alific ati o n s gi v e n in S c h e d ul e I A n n e x ur e–1 of th e s e
R e g ul ati o n s.
(ii) O t h e r q u alifi c ati o n s a s m a y b e s p e cifi e d b y th e
A ut h ority fr o m ti m e t o ti m e .
(iii) S h all b e a “ M e m b e r ” o f th e In stitut e .”
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W.P.(MD)No.10110 of 2015
8.Annexure I to Schedule I which relies on the Educational
qualification which needs to be possessed before a person is appointed as a
Surveyor is extracted for ready reference:-
IRDAI (Insurance Surveyors and Loss Assessors) Regulations, 2015
Qualification Criteria for Enrolment and Licensing of Surveyors and Loss Assessors
(Regulation 3)
S.No. Department Academic/technical/Professional/Insurance Qualifications
1. Fire B.E./ B. Tech./ B.Sc. (Engg.)/ A.I.M.I.E. or its equivalent, C.A./
I.C.W.A., A.I.I.I./ F.I.I.I./Post Graduate Diploma in Insurance from
IIRM
2. Marine Cargo B.E./ B.Tech./ B.Sc. (Engg.)/ A.I.M.I.E. or its equivalent thereof
(Marine Engineering/ Naval Architecture),/ certificate of
competency as Master of Ship or as First Class Marine Engineer
issued by a recognized authority, Degree or diploma in Naval
Architecture of a recognized University or Institute./ A.I.I.I./ F.I.I.I./
Post Graduate Diploma in Insurance from IIRM
3. Marine Hull B.E./ B.Tech./ B.Sc. (Engg.)/ A.I.M.I.E. or its equivalent thereof
(Marine Engineering/ Naval Architecture)/ certificate of competency
as Master of Ship or as First Class Marine Engineer issued by a
recognized authority,
4. Engg. B.E./ B.Tech./ B.Sc. (Engg.)/ A.I.M.I.E. or its equivalent , Diploma
of 3 years duration from a recognised institution or its equivalent
thereof
5. Motor B.E./ B.Tech./ B.Sc. (Engg.)/ A.I.M.I.E. or its equivalent thereof
(Mechanical/ Automobile); Diploma in Mechanical Engineering/
Automobile Engineering of 3 years duration from a recognised
institution or its equivalent thereof
6. Miscellaneous B.E./ B.Tech./ B.Sc. (Engg.)/ A.I.M.I.E. or its equivalent; Diploma
of 3 years duration from a recognised institution or its equivalent;
C.A./ I.C.W.A.; A.I.I.I./ F.I.I.I./ Post Graduate Diploma in Insurance
from IIRM;
7. LOP C.A./ I.C.W.A; A.I.I.I./ F.I.I.I
8. Crop Insurance B. Sc. in Agricultural Science from a recognised University.
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W.P.(MD)No.10110 of 2015
9.Regulation 27 prescribes that a Surveyor or Loss Assessor who is not
complaint that the requirement schedule of Section 64 UM of the Act, within a
period of three years from the date of the qualification of this requirements,
cannot perform the rule of a Surveyor. Regulation 27 of IRDAI, reads as under:-
“27.Tr a n sit or y P r o vi si o n s A lic e n s e i s s u e d b e f o r e th e
c o m m e n c e m e nt o f th e s e R e g ul ati o n s , b y th e A ut h ority s h all b e
deemed to h a v e been is s u e d in a c c o r d a n c e wit h th e s e
R e g ul ati o n s . P r o vi d e d th at all th o s e S urv e y or s an d L o s s
A s s e s s or s who ar e n ot c o m plia nt with th e r e q uir e m e nt s
s ti p ul at e d in cl a u s e ( a) a n d ( b) o f s u b- s e c ti o n 1 o f S e c ti o n 64 U M
o f th e A c t s h all b e c o m e c o m plia nt wit hin a p e ri o d o f thr e e y e a r s
fr o m th e d at e o f n otific ati o n o f th e s e R e g ul ati o n s failin g w hi c h
th eir lic e n s e s h all c e a s e t o b e v alid a ut o m ati c ally.”
10.A reading of all the provisions would show that it was never the
intention of the legislature to debar persons, who were working as a Surveyors
or Loss Assessors to cease work immediately. A window period has been given to
the existing Surveyors and Loss Assessors to acquire the educational
qualifications so that they can continue to perform their role as a Surveyor or a
Loss Assessor. The provision which gives three years window period to the
existing Surveyors to become complaint with the Regulations cannot be said to
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W.P.(MD)No.10110 of 2015
be arbitrary. The inability of a person to acquire such qualifications cannot
become a ground to seek for a declaration that the Regulations are ultra vires
of the Constitution of India. Prescribing qualifications cannot be said to be
violative of Article 19(g) of the Constitution of India. The Sections and
Regulations actually prescribes an uniform qualification that should be possessed
by of the Surveyor / Loss Assessors so as to maintain uniformity in the standard
in the nature of work to be performed by them in all the Insurance Companies.
The object of bringing out the amendment, therefore, cannot in any way be said
to be manifestly arbitrary or violation of Article 14 of the Constitution of India.
11.As stated above, the discremination on the account of inability to
acquire a qualification can never be pleaded and accepted by Courts. It is well
settled that a provision can be struck down only if the legislature bringing out
the enactment is not competent to bring out the same or the enactment is
contrary to any of the provisions of the Constitution or the Section or Rule or
Regulation sought to be brought in, is contrary to the parent Act or the
provision is manifestly arbitrary. It is now well settled that manifest arbitrariness,
must be something done by the legislature capriciously, irrationally and/or
without adequate determining principle. Also, when something is done which is
excessive and disproportionate, such legislation would be manifestly arbitrary.
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W.P.(MD)No.10110 of 2015
Nothing has been brought out by the petitioner to demonstrate that Section 64
UM of the Act, which is under challenge in the instant writ petition suffers from
the vice of manifest arbitrariness.
12.Reliance is placed on a Judgment rendered by Five Judges of the
Hon'ble Supreme Court in H A M D A R D D A W A D H A N A v . UNI O N O F
I N D I A , reported in A I R 1 9 6 0 S C 5 5 4 , and more particularly, paragraph
Nos.34 and 35, wherein the Hon'ble Supreme Court has struck down the
amendment on the ground that the parliament has established no criteria, no
standars and has not prescribed any principle on which a particular disease or
condition is to be specified in the Schedule. The said judgment has no
application to the facts of this case.
13.No doubt, a legislature cannot delegate essential legislative
function which consists in the determination or choosing of the legislative policy
and of formally enacting that policy into a binding rule of contempt. The object
of introducing Section 64 UM of the Act is, was to provide for a code of conduct
for Surveyors and loss Assessors. Section 64 UM of the Act only lays down that a
Surveyor or a Loss Assessor must possess the requisite educational qualification.
The educational qualifications have been laid down in the Insurance Regulatory
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W.P.(MD)No.10110 of 2015
and Development Authority of India (Insurance Surveyors and Loss Assessors)
Regulation 2015. The qualifications have been extracted above. The regulations
which prescribes educational qualification have not been challenged. The
contention of the counsel for the petitioner that the Section ought to have laid
down the guidelines prescribing the educational qualifications cannot be
accepted for the only reason that the legislature had not delegated any policy
function which is prohibited. The argument of the learned counsel for the writ
petitioner that uncanalized and unbridled power has been given to the Rule
making authority to prescribe qualifications cannot be accepted.
14.The Writ Petition, therefore, fails and accordingly dismissed. No
costs. Consequently, connected Miscellaneous Petitions are also dismissed.
[A. P. S . , C J. ,] [ S . P., J.]
2 5.0 2.2 0 2 0
Index : Yes/No
Internet : Yes /No
rj2
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W.P.(MD)No.10110 of 2015
To
1.The Secretary, Union of India,
Ministry of Finance,
Department of Financial Services,
3rd Floor Jeevandeep Building,
Sansad Marg, New Delhi 110 001.
2.The Insurance Regulatory and
Development Authority,
Represented by its Chairman,
Parishram Bhavan,
3rd Floor, Basheer Bagh,
Hyderabad 500 004.
3.The Deputy Director,
The Insurance Regulatory and
Development Authority,
Parishram Bhavan,
3rd Floor, Basheer Bagh,
Hyderabad 500 004.
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W.P.(MD)No.10110 of 2015
T H E HO N' B L E C HI E F J U S T I C E
A ND
S U B R AMO NIUM P R A S A D, J .
rj2 O RD E R MAD E IN W. P.(MD)N o. 1 0 1 1 0 o f 2 0 1 5 and M. P.(MD)N o s . 2 t o 4 o f 2 0 1 5 2 5.0 2.2 0 2 0 http://www.judis.nic.in 18/18