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W.A.No.461/2013 &

2.Essentially, the bone of contention in these matters is regarding the entitlement of a former agent of LIC to get renewal commission viz., commission on the renewal premium on the policies effected through him. Evidently, the said question of entitlement came up for consideration in W.P.(C)No.26791 of 2008 when the petitioner therein, a former LIC agent, was deprived of his renewal commission on the ground that after the termination of agency of the LIC, he became an agent of another competitor insurance company in the private sector. Virtually, the renewal commission was denied to him, on the aforesaid ground, in the light of Section 44(c) of the Act which is applicable to the LIC. The learned Single Judge upheld the action of the LIC and consequently, dismissed the writ petition which led to the filing of W.A.No.2712 of 2009. The Division Bench as per judgment dated 31.7.2012 held that clause (c) of the proviso to Section 44(1) of the Act which is applicable to LIC carries an embargo in its second limb which essentially is a condition for eligibility for entitlement to renewal commission, as aforesaid, and it applies to all the clauses under the proviso to Section 44(1) of the Act. In fact, the Division Bench held that the last part of proviso (c) to Section 44(1) of the Act is a condition for eligibility for renewal commission for a person who ceased to be an LIC Agent and going by the same, if he wants to get renewal commission for the business canvassed during his service as an Agent with the LIC, he should not join with a competitor W.A.No.461/2013 & and procure insurance business for them. In that view of the matter, the said appeal was dismissed. As noticed hereinbefore, the review petition is filed seeking review of the said judgment. W.A.No.461 of 2013 has been filed against the judgment in W.P.(C). No.30018 of 2009 which was dismissed repelling the contentions of the petitioner therein in support of his claim for renewal commission and referring to the decision in W.A.No.2712 of 2009. Evidently, the Division Bench doubted the correctness of the decision in W.A.No.2712 of 2009 and thereafter holding that an important question of law, as mentioned above, is involved, referred the matters.

5. The appellant in W.A.No.461 of 2013 and the deceased Baby John who originally filed W.A.No.2712 of 2009, which is now sought to be pursued by his widow, were former LIC agents and both of them had more than the prescribed length of service as LIC agents to earn eligibility for renewal commission under clause (c) of the proviso to W.A.No.461/2013 & section 44 of the Act. It is pursuant to the interpretation of Section 44 of the Act applicable to LIC in terms of the notification of Government of India viz., GSR 262(E) dated 24.7.1972 that it was discontinued in the case of the appellant in the above writ appeal. In the case of the review petitioner's husband who resigned from the agency he was informed of his ineligibility for renewal commission, based on the very same clause, when he raised a claim for the same besides being asked to pay back the advance received. The common contention raised on behalf of the appellant and the review petitioner, in regard to the aforesaid question of law is that the embargo under clause (c) of the proviso to section 44 of the Act in respect of persons who cease to act as LIC agents to the effect that they shall not directly or indirectly solicit or procure insurance business for any other person, is confined only to the category of former LIC agents falling under clause (c) and it is absolutely inapplicable to persons eligible for renewal commission under clauses (a), (b), (bb) and (bbb) of the proviso to Section 44(1). It is contended that all such clauses which prescribe eligibility for getting renewal commission are mutually exclusive and are given as alternative eligibilities. Per contra, the learned Counsel appearing for the LIC contended that the said contentions are bereft of any basis and merit and such contentions, if accepted, would defeat the very soul of the proviso to Section 44 of the Act. It is their contention that clauses (a) to (bbb) and the first limb of clause (c) of the proviso to W.A.No.461/2013 & Section 44(1) of the Act are all carry eligiblity criteria or, in otherwords, they are the five eligibility conditions for getting renewal commission on cessation of being an agent of the LIC and the condition under the second limb of clause (c) to the aforesaid proviso, which is correctly contrued as an embargo by the Division Bench in the judgment in W.A.No.2712 of 2009, applies to all persons falling under clauses (a) to (bbb) and the first limb of clause (c), of Section 44(1) of the Act.

(a) to (bbb) and clause (c), of Section 44(1) of the Act, as extracted above, would leave no room for any doubt regarding the position that they carry different eligiblity criteria for renewal commission on cessation of being an LIC agent. A bare perusal of Section 44(1) and (2) of the Act would reveal that clauses (a) to (c) of the proviso to sub-section (1) deal with renewal commission. In fact, section 44 deals with prohibition of cessation of payments of commission. An W.A.No.461/2013 & analytical approach would undoubtedly reveal that the second limb of clause (c) is a condition partaking the character of an embargo on the entitlement to receive renewal commission. Obviously, the conjunction 'and' joins its first limb with the second limb. But, what is more relevant and crucial for the purpose of deciding the issue is that each of the earlier clauses viz., (a) to (bbb) ends up with semicolon. It is to be noted that semicolon (;) is a punctuation mark indicating a greater degree of separation than the 'comma' and it is being used to separate parts of a sentence. It is also worthy to note that in addition to semicolon, the conjunction 'or' is also used immediately after semicolon. Thus, the very syntax of the proviso to Rule 44(1) of the Act carrying different clauses would reveal that the punctuation 'semicolon' and the conjunction 'or' are used in between the clauses carrying different eligibility criteria for renewal commission, not without any purpose. In fact, they would indicate that in troth, they form a single sentence carrying different clauses and in the end such clauses carrying eligibility criteria is connected to its last part with the conjunction 'and'. There can be no doubt that no sentence can end with a semicolon and above all it is to be noted that only at the end of clause (c) of the said proviso the punctuation mark 'full stop' (.) is given. Indisputably, the punctuation 'full stop' (.) is used only at the end of a sentence that is not a question or an exclamation. In fact, it can only be taken that such unusual approach was made with a W.A.No.461/2013 & purpose to ensure that the prohibition on cessation of payments of renewal commission to those former LIC agents who are made eligible for and entitled to renewal commission for the policies effected through them, even after cessation of such agency under all the clauses, would and should satisfy the condition enjoined under the second limb of clause (c) of the proviso, to avoid cessation of payment of such commission. In strict sense, in such circumstances, it cannot be said that it is purely a part of clause (c) alone having applicablity in the cases of persons falling under the first limb prohibiting payment to them if they directly or indirectly solicited or procured insurance business for any other person. The purpose revealed from the second limb of clause (c) of the proviso to Section 44(1) of the Act applicable to LIC, cannot brook any construction other than that the said condition is intended to act as an embargo applicable to all the clauses carrying eligibility criteria for renewal commission on cessation of agency and that it is one which would disqualify the contravenors who directly or indirectly solicit or procure insurance business for any other person, from receiving renewal commission. If clause (c) as such is taken as independant clause and the embargo lies in the second limb as one applicable only to those former LIC agents falling under its first limb it would be an arbitrary, hostile discrimination against those former agents who toiled and moiled for LIC much more years than those who fall under the other clauses viz., (a) to (bbb). At the same W.A.No.461/2013 & time, if it is taken as an embargo applicable to all former LIC agents otherwise eligible for renewal commission in terms of the clauses to the proviso to section 44 (1) of the Act, it would act as a condition applicable to all similar persons under similar circumstances, embracing the salutory principles of equality before law and equal protection of law. Yet another danger is hidden in the contra contention and that cannot go unnoticed while constructing the said provision. If clause (c) is treated as an independant clause, former LIC agents who satisfy all the eligibility criteria under the first limb of clause (c) and became disqualified solely due to the embargo under the second limb, could shed their disquaification if they could successfully contend that despite such disqualification they are still eligible to get renewal commission on satisfying the eligibility criteria under any other clause. Certainly, that cannot be the intention of the legislature. If such a contention is accepted, it would undoubtedly make clause (c) meaningless and inoperative as persons who may be ineligible to get renewal commission may still claim the same raising the contention that they satisfy the criteria under one or other of the remaining clauses. It is only befitting to keep reminded of the maxim 'Semper inobscuris quod minimum est sequimur' which means 'In obscure contructions were always adopt that which is least obscure' even if it is taken that some obscurity lies in the proviso. Even in such circumstances, the one which would eliminate hostile W.A.No.461/2013 & discrimination has to be adopted. At any rate, a purposive construction of the proviso to Section 44(1) of the Act applicable to LIC on the question of applicabilty of the second limb of clause (c), would always acknowledge and accept the construction that it applies to all categories of former LIC agents falling under clauses (a) to first limb of Clause (c) of the proviso to Section 44(1) of the Act as applicable to LIC. In the light of the discussions as above, we are inclined to answer the referred question in the affirmative. In otherwords, according to us, the second limb of clause (c) of the proviso to Section 44(1) of the Act is one which would apply to the other different clauses thereunder applicable to LIC viz., clauses (a), (b), (bb) and (bbb) introduced to that proviso so as to import the said embargo even in respect of persons falling under clauses (a) to (bbb).

11.In the appeal, the appellant has taken up certain contentions which were not specifically raised in the writ petition. The contention W.A.No.461/2013 & that the five conditions stipulated virtually as eligibility to get renewal commission in the proviso to section 44(1) of the Act are alternative conditions and they are independent of each other, was not specifically raised in the writ petition. That apart, it is the contention of the appellant that the second part of clause (c) of the proviso applies only to its first part and at any rate, it is not applicable to the other clauses to the proviso. We have already considered the said contentions of the appellant while considering the referred question. In the light of the answer which we made to the referred question, those contentions cannot be sustained. In such circumstances, what survives for consideration in the appeal is the alternative contention taken up by the appellant that since he being a person who secured Rs.225 crores worth insurance business under 595 policies as on December, 2007, he would satisfy the requirements under clause (bb) of proviso to section 44(1) of the Act and therefore eligible for commission for renewal premium in respect of the policies secured by him. It is also contended that the finding of the learned Single Judge that restriction imposed on clause (c) is only a reasonable restriction and could not be termed as illegal is not sustainable in law. From the pleadings of the appellant taken up in the writ petition as also in the appeal it is evident that he is actually the former LIC agent whose case falls under clause(c) of the proviso to section 44(1) of the Act. He was having more than ten years service continually and exclusively under W.A.No.461/2013 & the first respondent LIC. It is a fact that he had actually resigned from the agency by submitting Ext.P2 which was accepted as per Ext.P3 letter by the third respondent. Termination of his agency and his joining as Unit Manager in State Bank of India Insurance Company is not disputed, as already mentioned. It is in the said circumstances that citing the embargo under clause (c), he was denied renewal commission. The contention of the appellant is that in the light of the main provision under section 44(1), a former LIC agent would become ineligible for grant of renewal commission on termination of his agency only on the ground of fraud. The said contention is bereft of any basis. A bare perusal of section 44(1) and its proviso carrying different clauses would reveal that the entitlement to renewal commission depends upon the satisfaction of the eligibility criteria under each clause thereunder. Since in the light of the answer which we gave to the referred question, the contentions that all the five alternative conditions carrying the eligibility are independent of each other and the second limb of clause (c) is inapplicable to all the other clauses under the proviso to section 44(1) are devoid of merit. When by virtue of the position that the case of the appellant falls under clause (c) and owing to his violation of the second limb of clause (c), by joining in a competitor insurance company, he became ineligible to get renewal commission the contention of the appellant to get over the same is that even if by virtue of the said W.A.No.461/2013 & provision he is ineligible to get renewal commission as he satisfies the eligibility criteria under clause (bb) of the proviso, he is entitled to get renewal commission. We are afraid the said contention cannot be countenanced. Being a person who falls squarely under clause (c) but disentitled to get renewal commission by virtue of violation of second limb of clause (c) carrying the embargo which is applicable to all other clauses the appellant cannot be heard to contend that the said embargo and the consequential violation of it, would not disentitle him to get renewal commission under clause (bb) or under any other head. True that the appellant has also sought an alternative relief to declare section 44(1)(c) of the Insurance Act to the extent it prohibits an agent from soliciting or procuring insurance business directly or indirectly for any other person, as unconstitutional, illegal and void. The learned Single Judge held that the restriction imposed by the statute by virtue of proviso (c) is only reasonable and it could not be termed as illegal. Despite the rejection of the prayer for such a declaration, the appellant has not specifically raised any ground to challenge the same in the appeal. We have carefully gone through the pleadings in the appeal and also in the writ petition. A careful scanning of the pleadings in writ petition would reveal that the appellant sought to challenge the embargo under the second limb of clause (c) of the proviso to Rule 44(1) of the Act as one that violates Article 14 of the Constitution of India. According to the appellant, if W.A.No.461/2013 & section 44(1)(c) is construed to mean that all former LIC agents who got more than ten years of service are prohibited from taking up service under another insurer it would lead to an anomalous situation where an agent with lesser service could take up employment under another insurer and continue to get commission payable on renewal premium, but persons with the aforesaid prescribed length of service would alone be disentitled to get it. In the light of our answer to the referred question, such a situation would not arise. Apart from the said contention, the appellant has not taken up any other contention to challenge the embargo contained under the proviso (c) to section 44(1) of the Act. It is well settled in law that he, who assails constitutional validity of a statutory provision or rule, has to specifically assert the grounds for such challenge. (See decisions: