2009 PLP 1326 (CLD)

MUHAMMAD KHALID ALVI, J.

Brief facts of the case are that husband of appellant namely Subedar (R) Iqbal Hussain was a Sales Manager with respondent Insurance Company and had a licence in his name and its validity expired on 22-2-200.1, which was renewable within a period of one year i.e. till 22-2-2002 under section 42-A of the Insurance Act, 1938 read with Rule 22 of Insurance Rules, 1958 but in the meanwhile, on 27-11-2001, before the date of termination of licence, he passed away and a claim for Group Insurance was filed by the present appellant before respondents, which was turned down and consequently an application was brought before learned Tribunal, which was resisted by respondents on the ground that since licence of deceased had expired on 22-2-2001 and it was not renewed, therefore, same shall be treated to have been terminated and with the termination, claim of insurance automatically vanishes. After recording evidence of parties learned Tribunal vide order dated 21-2-2008 dismissed the application, same is being assailed through instant appeal.

2. Learned counsel for appellant submits that after repeal of Insurance Act, 1938 through Insurance Ordinance, 2000 on 19-8-2000 the office of Controller of Insurance was abolished and there was no system of issuance or renewal of licence, therefore, as a matter of interim arrangement a Memorandum was issued by the competent authority on 11-12-2001 i.e. after death of insured, whereby interim arrangement was made for the issuance and renewal of licence etc. It is further submitted that' according to' Para.2.5 of "field matters" issued by respondents, a licence or a certificate which is renewable remains in field till its grace period expires. Learned counsel has also referred to Clause "G" of the Memorandum of Understanding between respondents and employees to contend that failure to apply for renewal of lapsed licence within the prescribed time will not be treated as termination of licence. It is thus concluded that on the basis of above referred legal position appellant was entitled to claim of Group Insurance of her deceased husband.

3. On the other hand, learned counsel for respondents contends that before approaching the Tribunal, appellant availed remedy before the Federal Ombudsman and President of Pakistan as well, which was also declined. Learned counsel for respondents, however, has not disputed the documents referred by learned counsel for appellant, however, prays for dismissal of appeal.

4. We have considered arguments advanced by learned counsel for the parties.

5. Memorandum of Understanding between the respondents and employees as amended up to date clearly postulates that "failure to apply for the renewal of lapsed licence within prescribed time will not be treated as termination of licence". Admittedly, licence of deceased lapsed on 22-2-2001 and time for its renewal was till 22-2-2002, during this time he passed away on 27-11-2001 when still three months' time was available for him to have got his licence renewed, therefore, same cannot be treated to have been terminated. Apart from this, with the repeal of old Insurance Law and by introduction of new Insurance Ordinance, 2000 w.e.f. 19-8-2000 the Office of Controller of Insurance had ceased to exist, therefore, process of licensing and renewal also stopped, for which an interim arrangement had to be made through a Memorandum issued on 11-12-2001, which is also after the death of deceased husband of the appellant, therefore, there was no occasion for deceased to have got his licence renewed. This Memorandum had to be issued by respondents in order, to bridge the gap existing in the law at that time and also to provide remedies to affected persons.

6. For all what has been stated above, this appeal is allowed. Resultantly, application filed by the applicant is also allowed along with liquidated damages because no fault on the part of appellant could be pointed out by learned counsel for respondents. No order as to costs. H.B.T./M-393/L Appeal allowed.