Case: Amar Krishna Ghose Vs. Life Insurance Corporation Of India &amp; Anr

December 1955, a liability, which the Custodian and later on the Corporation were liable to satisfy, the former as a result of the management having vested in him under the Ordinance, and the latter as a result of its having succeeded to the assets and liabilities of the insurer. He also contended that the question as to whether the appellants contract of service with respondent 2 stood terminated on January 19, 1956 under cl. 3 (2) of the Ordinance would also not fall under R. 12A. The Addl. Solicitor-General, on the other hand, disputed such a construction of R. 12A and contended that the tribunal had under Rule the exclusive jurisdiction to determine both the questions, and the High Court could not by reason of S. 41 of the Act entertain or adjudge either of the two questions. 8. The reliefs prayed for by the appellant in his plaint pertained to two periods; (1) Rs. 5436.0.0 being the arrears of salary and other dues for the months of November and December 1955, and (2) Rs. one lac and odd being the salary from January 1, 1956 to December 1958. Under R. 12A, a question either of liability or of any nature whatsoever in relation to the assets or liabilities pertaining to the controlled business of the insurer transferred to and vested in the Corporation falls within the jurisdiction of the tribunal and cannot be entertained and adjudicated by a civil Court under S. 41 of the Act. In respect of the claim for arrears of salary for November and December 1955, the question really would be one of liability in regard to or pertaining to the controlled business of the insurer which became transferred to and vested in the Corporation. That question, therefore, fell fairly and squarely within the jurisdiction of the tribunal. The expression "controlled business of the insurer" in R. 12A means the life insurance business carried on by an insurer before its management became vested in a Custodian under the Ordinance and whose assets and liabilities became transferred to and vested in the Corporation under the Act. R. 12A clearly deals with questions arising out of and pertaining to such controlled business. Under R. 12A, jurisdiction to try questions in respect of the liability pertaining to such business has been vested in the tribunal. The question of the liability of the Corporation in regard to the arrears of salary for November and December 1955 clearly related to the controlled business then carried on by respondent 2. The Corporation was sought to be made liable to pay those arrears on the ground that that liability was transferred to and vested in the Corporation. Clearly R. 12A applied to such a question and the jurisdiction to try such a question was in the tribunal and not the High Court. Any question, therefore, as to the liability pertaining to the business which was the controlled business as defined by the Act would have to be tried by the tribunal. 9. As regards the second claim of the appellant, that claim involved the question as to whether his contract of service with respondent 2 stood terminated on January 19, 1956 by virtue of cl. 3 (2) of the Ordinance. If it did, he would not be a person who was employed by the insurer wholly or mainly in connection with his controlled business immediately before the appointed day (which is September 1, 1956 under the Act) as required by Section 11 (1) of the Act, and therefore, he could not claim to be one who became and continued to be an employee of the Corporation as envisaged by that sub-section. Under sub-sec. (3) of Section 11, the question whether an employee was employed wholly or mainly in connection with the controlled business of an insurer immediately before the appointed day under the Act (i.e., September 1, 1956) is determinable by the Central Government and not by a civil Court. That question, however, would depend upon the question whether the appellants contract of service stood terminated by reason of cl. 3 (2) of the Ordinance on September 1, 1956. Has the tribunal the exclusive jurisdiction to decide that question ?The High Court though so, and in our view rightly because R. 12A confers on the tribunal the jurisdiction to try "any question.......of any nature whatsoever in relation to.............liabilities pertaining to the controlled business of the insurer transferred to and vested in the Corporation". These are very wide words which would include the question whether the appellant as the principal officer of respondent 2 continued to be such officer after January 19, 1956 in relation to the controlled business which on and after January 19, 1956 was to be managed in terms of the Ordinance by a custodian appointed thereunder and whose assets and liabilities on the passing of the Act were transferred to and vested in the Corporation. The question whether his contract of employment as the principal officer of the business, defined as the controlled business both under the Ordinance and the Act, continued or not after January 19, 1956 would be a question in relation to the liability pertaining to such controlled business and was therefore within the scope of R. 12A. But the question as to whether he became an employee of the Corporation under S. 11 (1) on and from January 1, 1956, though dependent on the answer as to whether his contract stood terminated under cl. 3 (2) of the Ordinance, would not fall within R. 12A and was not therefore triable by the Tribunal. The High Court, therefore, was right in splitting the appellants claim into two, one triable by the tribunal and the other not, and retaining with it that part of the suit which did not fall within the scope of R. 12A with liberty to the parties to raise later on the question whether that part was triable by the Court or by the Central Government under S. 11 (3) of the Act.

Decision (1 = appeal accepted, 0 = rejected): 0

Explanation:
0[ds]8. The reliefs prayed for by the appellant in his plaint pertained to two periods; (1) Rs. 5436.0.0 being the arrears of salary and other dues for the months of November and December 1955, and (2) Rs. one lac and odd being the salary from January 1, 1956 to December 1958. Under R. 12A, a question either of liability or of any nature whatsoever in relation to the assets or liabilities pertaining to the controlled business of the insurer transferred to and vested in the Corporation falls within the jurisdiction of the tribunal and cannot be entertained and adjudicated by a civil Court under S. 41 of the Act. In respect of the claim for arrears of salary for November and December 1955, the question really would be one of liability in regard to or pertaining to the controlled business of the insurer which became transferred to and vested in the Corporation. That question, therefore, fell fairly and squarely within the jurisdiction of the tribunal. The expression "controlled business of the insurer" in R. 12A means the life insurance business carried on by an insurer before its management became vested in a Custodian under the Ordinance and whose assets and liabilities became transferred to and vested in the Corporation under the Act. R. 12A clearly deals with questions arising out of and pertaining to such controlled business. Under R. 12A, jurisdiction to try questions in respect of the liability pertaining to such business has been vested in the tribunal. The question of the liability of the Corporation in regard to the arrears of salary for November and December 1955 clearly related to the controlled business then carried on by respondent 2. The Corporation was sought to be made liable to pay those arrears on the ground that that liability was transferred to and vested in the Corporation. Clearly R. 12A applied to such a question and the jurisdiction to try such a question was in the tribunal and not the High Court. Any question, therefore, as to the liability pertaining to the business which was the controlled business as defined by the Act would have to be tried by the tribunal9. As regards the second claim of the appellant, that claim involved the question as towhether his contract of service with respondent 2 stood terminated on January 19, 1956 by virtue of cl. 3 (2) of theOrdinance.If it did, he would not be a person who was employed by the insurer wholly or mainly in connection with his controlled business immediately before the appointed day (which is September 1, 1956 under the Act) as required by Section 11 (1) of the Act, and therefore, he could not claim to be one who became and continued to be an employee of the Corporation as envisaged by that sub-section. Under sub-sec. (3) of Section 11, the question whether an employee was employed wholly or mainly in connection with the controlled business of an insurer immediately before the appointed day under the Act (i.e., September 1, 1956) is determinable by the Central Government and not by a civil Court. That question, however, would depend upon the question whether the appellants contract of service stood terminated by reason of cl. 3 (2) of the Ordinance on September 1, 1956. Has the tribunal the exclusive jurisdiction to decide that question ?The High Court though so, and in our view rightly because R. 12A confers on the tribunal the jurisdiction to try "any question.......of any nature whatsoever in relation to.............liabilities pertaining to the controlled business of the insurer transferred to and vested in the Corporation". These are very wide words which would include the question whether the appellant as the principal officer of respondent 2 continued to be such officer after January 19, 1956 in relation to the controlled business which on and after January 19, 1956 was to be managed in terms of the Ordinance by a custodian appointed thereunder and whose assets and liabilities on the passing of the Act were transferred to and vested in the Corporation. The question whether his contract of employment as the principal officer of the business, defined as the controlled business both under the Ordinance and the Act, continued or not after January 19, 1956 would be a question in relation to the liability pertaining to such controlled business and was therefore within the scope of R. 12A. But the question as to whether he became an employee of the Corporation under S. 11 (1) on and from January 1, 1956, though dependent on the answer as to whether his contract stood terminated under cl. 3 (2) of the Ordinance, would not fall within R. 12A and was not therefore triable by the Tribunal. The High Court, therefore, was right in splitting the appellants claim into two, one triable by the tribunal and the other not, and retaining with it that part of the suit which did not fall within the scope of R. 12A with liberty to the parties to raise later on the question whether that part was triable by the Court or by the Central Government under S. 11 (3) of the Act.