AMAR KRISHNA GHOSE versus LIFE INSURANCE CORPORATION OF INDIA & ANR.

Citation: [1973] 2 S.C.R. 998 · Decided: 14-11-1972 · Supreme Court of India · Bench: J.M. SHELAT · Disposal: Dismissed

Judgment (excerpt)

998 
AMAR KRISHNA GROSE 
v. 
LIFE INSURANCE CORPORATION OF INDIA & ANR. 
November 14; 1972 
[J. M. SHELAT AND Y. v. CHANDRACHUD. JJ.] 
Life Insurance (Emergency Provisions) Ordinance, 1 of 1956-C/. 3(2) 
'Jeemed' termination of service-Ute frisurance Corporation Act, 31 of 
1956, Sec. 11(1) &: 11(3). 
Life Insurance Corporation Rules, 1956 Rule 12-A-Exc/usiv. ;uris-
1 diction of the Life lnsurilnce Tribunal-Whether word "liablUty of th• 
controll. d business of insurer" cover questions of arrears of pay and 
deemed :ermirtation of erstwhile employees. 
,l\.ppellant, an employee rlf an erstwhile Life Insurance Company filed 
a suit against the L.I.C. in the Calcutta High Court inter alia, claiming 
that the purported termination of his service was void and for 11 declara· 
tion that he continued to be in service of the Corporation after the vesting 
of the business in the Life Insurance Corporation. 
He further claimed 
Ute atrcars of rent and other dues accrued before the vesting and salary 
for the subsequent period. The Calcutta High Court split the two set of 
reliefs and held that under Rule 12-A-the Life Insurance Tribunal had 
the exclusive jurisdiction to decide whether the Cory<?ration was liable as 
a successor to the said companies for the earlier ltabilities er not. 
The 
High Court 'further held that the question as to whether the employment 
of the appellant stood terminated by virtue of sec. 3 (2) of the Ordinance 
was also within the exclusive jurisdiction of the Tribunal. Since the relief 
for declaration of the continuation of service ·. and subsequent salary 
depended upon the question of termination of service under sec. 3(2) 
of the Ordinance, the High Cotirt ordered that that part of the claim may 
sta.nd over and considered after the TribunaI's decision on the first set o( 
issues. 
The court gave liberty to the Corporation to agitate (at such an 
adjourned hearing) that the Central Government has the exclusive juris-
diction under sec. 11 (1) & 11 ( 3) of Act to adjudicate the question of 
continuation rlf employment. 
On appeal the Court, 
HEID : ( 1) The expressiou "controlled business of the insurer" in 
Rule 12A means the life insurance busineis carried on by an insurer 
before its management became vested in a custodian under the ordinance 
and then in the Corporation. The appellant was not right in .contending 
that the past liabilities do not relate to "controlled business". Therefore the 
Tribunal was. the proper authority to decide question of arrears of pay 
and other dues. [1003 BJ 
(2) Rule 12-A confers on the Tribunal the jurisdiction to try "any 
question ••. of any nature whatsoever in relation to .... liabilities pertain-
ing to controlled business." The question, whether the services of the 
appellant stood terminated by cl. 3 ( 2) of the Ordinance is related to the 
'liability' of the "controlled business" and is covered by the wide wording 
of Rule 12-A. The Tribunal alone had the jurisdiction to decide the 
said question. [1005 DJ 
(3) The High Court was right in splitting the appellants' claim into 
two, one triable by the Tribunal and the other not, and retainina with it 
A 
B 
c 
D 
E 
F 
G 
H 
A. K. GHOSE v. L.I.C. (Shelat, J.) 
9 99 
A 
that part of the suit which. did not fall within the scope of R. 12-A with 
lib•'~"· 1" ,-"~ parties to nuse later on the questlon whether that part was 
tri•u•c oy the court or by the Central Government under S. 11 (3) of tlle 
Act. [1005 GJ 
B 
Appeal dismissed. 
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 1331 of 
1967. 
Appeal by certificate from the judgment and 
order dated 
February 28, 1966 of the Calcutta High Court in Appeal from 
Order No. 88 of 1965. 
M. C. Setalvad and Ram Prosanna Bagchi and Sukumar 
C 
Ghose for the appellant. 
D 
E 
F 
G 
H 
F. S. Narima11, Additional Solicitor General of India, K. L . 
. Hathi and P. C. Kapur for the respondent No. 1. 
The Judgment of the Court was delivered by 
SHELAT, J, 
This appeal, founded on the certificate granted 
by the High Court of Calcutta, raises questions of interpretation 
of sec. 3(2) of the Life Insurance (Emergency Provisions) Ordi· 
nance, 1 of 1956, sec. 11 of the Life Insurance Corporation Act, 
31 of 1956 and R. 12A of the Life Insurance Corporation Rules, 
1956 made under s. 48 of the said Act. 
These questions arise in the following circumstances : 
Prior to January 1, 1956 the appellant was employed as the 
Pdncipal Officer of .the Bengal Insurance and Seal P

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