IN THE HIGH COURT OF JUDICATURE AT PATNA CWJC No.9580 of 2004 LALITA DEVI & ANR Versus THE STATE OF BIHAR & ORS ----------- 21 30.03.2010 Mr. Chakradhari Sharan Singh for the petitioners, Mr. Jai Shankar Barnwal for the Magadh University, Mr. Sarvadeo Singh for the respondent no. 6 and Mr. Amod Kumar, learned junior counsel to Mr. Rajeev Ranjan Prasad, representing the Life Insurance Corporation of India are present. This writ petition for all practicable purposes was decided under the order dated 23.3.2010. In so far as the liability of the University towards payment of post retiral dues and other admissible dues of the petitioners who are daughters of late Mahendra Manjhi, a Class-III employee is concerned, the only issue which remained for adjudication was whether the deceased employee and his heirs would be entitled to the insurance amount under the Group Savings Linked Insurance claim prevalent in the University, of which admittedly late Mahendra Manjhi was a member. The only objection raised by the learned counsel appearing on behalf of the Corporation is that on the date on which Mahendra Manjhi expired i.e. 7.3.2000, the premium for the month of February, 2000 had not been deposited by the University rather was deposited only on 16.3.2000, hence the policy in so far as late Mahendra Manjhi is concerned, was in a lapsed condition and thus in terms of the provisions of the Scheme, late Mahendra Manjhi was not entitled for the insurance amount rather he - 2 - was simply entitled to the payments of the premiums deposited together with interest accruing thereon and which had since been paid to him vide letter dated 16.8.2001 placed at Annexure-16 to the writ petition. He further, with reference to paragraph 5 and 6 of the counter affidavit, submits that the monthly premium under the Scheme was to the tune of Rs. 5850/-. The premium due on 28.1.2000 was paid on 17.2.2000 but in so far as the premium of February, 2000 is concerned, an amount of Rs. 5750/- was deposited on 16.3.2000 which was a hundred rupee less than the amount paid in the February, 2000. It is contended that the said hundred rupee was the premium payable for the deceased employee and thus in absence of deposit of the said premium, the risk portion of the deceased employee stood lapsed and he was not entitled to the death claim of Rs. One lac. Learned counsel for the Corporation in support of his contention relies upon a Bench decision of this Court reported in 2000(2) P.L.J.R. 486 (Chameli Khatoon Vs. The State of Bihar). He submits that though there was no onus on the part of the employee concerned to deposit the premium which was required to be deposited by the employer but even if the claim of the insured is found justified, the payment would be made by the employer for his lapses and the Corporation cannot be saddled with the liability for the reason that admittedly the policy was in a lapsed condition on the date of death of the deceased employee. He submits that even in the case of Chameli Khatoon the Court even while finding the claim admissible, directed the employer to pay the same and not the Corporation. - 3 - Learned counsel appearing on behalf of the petitioner submits that the monthly premium was required to be deposited by the concerned college and if the college did not remit the premium for the month of February then the beneficiary cannot suffer nor can be held responsible as there was no responsibility imposed on the insured to ensure that the premiums are deposited in time. He, in support of his contention, relied upon a Supreme Court judgment reported in 1999(8) SCC 229 (Delhi Electric Supply Undertaking Vs. Basanti Devi & Anr). That was a case arising under the Salary Savings Scheme. The employer i.e. Delhi Electric Supply Undertaking, in similar circumstances did not deposit the premium of the insured with the L.I.C. within the prescribed period and on 9.8.1987 the insured employee met with an accident and died. The premium was deposited only the following date on 10.8.1987. The claim was repudiated by the L.I.C. on the grounds that the policy had lapsed by reason of non- payment of the premium. The Supreme Court examining the Scheme of Insurance under the Salary Savings Scheme held the employer to be acting as the agent, in the matter of taking of premium and deposit thereof with the respondent Corporation. It was held that as the insured had no volition to ensure the deposit of the premium, he did not even have the responsibility to look into the same and that for the fault of the employer the insured could not have suffered. In the circumstances, the L.I.C. was directed to pay the insured amount together with an interest at the rate of 15 per cent. Learned counsel relied upon another Bench decision of this - 4 - Court reported in 2005(1) P.L.J.R. 415 (Dheeraj Kumar Verma Vs. the State of Bihar). Learned counsel submits that the said judgment has taken into consideration not only the judgment rendered by the Supreme Court but also the judgment relied upon by the Life Insurance Corporation in the case of Chameli Khatoon (supra). He submits that the said judgment was dealing with the case arising from Group Savings Linked Scheme. A similar objection had been raised by learned counsel appearing on behalf of the Corporation in the said case submitting that the two Schemes i.e. the Salary Savings Schemes and Group Savings Linked Scheme were operating in two different spheres and were not similar. It was thus stated that the judgment rendered by the Supreme Court was in context with the Salary Savings Scheme and did not apply to cases of Group Savings Linked Schemes. By the judgment passed in the case of Dheeraj Kumar Verma (supra), it was held that there was no difference between the two Schemes and under both the Schemes the employer acted as an agent of the Corporation in collecting the premium and deposit thereof with the Corporation. It was further held that for the fault of the employer who did not deposit the premium in time, the insured could not be penalized for such failure of discharge of liability by the employer. In such situation, the Court directed the payment of the insured amount together with interest calculated from the date of death until the date of payment. In the present case also I find that by letter dated 15.3.2001 the Principal of G.J. College, Rambagh, Bihta had requested the - 5 - Manager, Group Savings Linked Division, Patna to release the payment of he death insurance claim of late Mahendra Manjhi. The date of deposit of the premium was also mentioned therein and which showed that the premium for the month of February was admittedly deposited on 16.3.2000. The relevant policy has been enclosed by the respondent Corporation and is placed at Annexure-A. Part II of the policy provides that no grace period would be allowed for payment of premium. It also provides that if the premium was not paid in a particular month, the policy would be discontinued as a whole and that the Corporation reserves the right to terminate the policy. It is indisputed that the policy was neither discontinued nor was terminated. What the learned counsel for the Corporation has tried to advance is that the policy in so far as late Mahendra Manjhi is concerned, stood lapsed. This is certainly not any of the conditions/stipulations of the Scheme. Under the Scheme either the policy should have lapsed or should have discontinued. The moment the Corporation chose to continue the Scheme, all the claims arising therefrom stood revived. In view of the judgment passed by the Supreme Court and noted by this Court in the case of Dheeraj Kumar Verma (supra), the deceased employee is not to be blamed for non- payment of premium, if any. Though the position has been clarified by the letter dated 15.3.2001 (Annexure-15) demonstrating that the payments in relation to the deceased employee stood deposited albeit with slight delay, the policy never came to be discontinued nor terminated. The claim of the insured could not have lapsed nor could - 6 - he be denied the benefit for any reason not attributable to him. In that view of the matter, I hold that the heirs of the deceased employee would be entitled to the insurance claim consequent upon his death on 7.3.2000 and which amount should be paid to them together with interest at the rate of 8 per percent from the date of death until the payments are made which I expect should be made preferably within a period of three months. The claim, in so far as the University is concerned, stands adjudicated by this Court’s earlier order dated 23.3.2010. The said order would form a part of the present order. The admissible dues of the petitioner payable by the University and taken note of by this Court in the order dated 23.3.2010 and have not yet been paid, should be paid by the University within a period of three months from today. The writ petition stands disposed of. S.Sb/- (Jyoti Saran, J.)