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TMI Blog2012 (5) TMI 875X X X X Extracts X X X X X X X X Extracts X X X X ..... urance; the said Resolution was passed with the object of rendering medical aid to foreign citizens temporarily in the territory of Ukraine; (ii) Ukrinmedstrakh, a Ukrainian company was granted exclusive licence by the Government of Ukraine for providing such obligatory medical insurance for foreigners temporarily staying in the territory of Ukraine; (iii) The said Ukrinmedstrakh entered into an Agreement dated 20.09.1997 with the appellant whereunder it authorized the appellant to sell the obligatory medical insurance policy of Ukrinmedstrakh to Indians intending to visit and / or travelling to Ukraine; (iv) the appellant in or about the year 1998 obtained the requisite clearance from the Reserve Bank of India for collecting insurance premium from the intending visitors to Ukraine and to remit the same to Ukrinmedstrakh / Government of Ukraine; (v) similarly, the Government of Belarus also vide Resolution dated 26.06.2000 made it mandatory for all visitors to the Republic of Belarus to purchase the medi-claim insurance policy prior to applying for the VISA at the Embassy of Belarus at New Delhi. An Agreement dated 12.07.2001 was executed between the appellant and the Belarusian St ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... company, the respondent No.1 IRDA in exercise of powers under Section 14(1) of the IRDA Act directed the appellant to stop issuing, marketing or selling insurance policies, collecting money towards insurance premium or carrying on any activity related to and connected with the business of insurance; for violation, the appellant was threatened with proceedings under the Insurance Act and the IRDA Act and Regulations framed thereunder. 4. It was the case of the appellant in the writ petition that the Certificate of medi-claim being issued by the appellant had no effect on the territory of India and was active only in the territory of Ukraine or Belarus; that the provisions of IRDA Act were not applicable to the foreign insurance companies and that the activity undertaken by the appellant was not governed by the IRDA Act. 5. The learned Single Judge dismissed the writ petition finding/ observing / holding: (i) that the collection of premium and the delivery of Certificate in India by the appellant amounted to carrying on the business of insurance in India; (ii) that the appellant was thus carrying on insurance business in India on behalf of foreign insurance companies; (iii) the appe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ese proceedings more by way of public interest, for the facility of the intending visitors to the said countries. He has also argued that the appellant is not desirous of violating any law and would be happy to register with the respondent No.1 IRDA also, as it has obtained permission under the Foreign Exchange Regulation Act, 1973 and Foreign Exchange Management Act, 1999 but even that course of action is not possible. He argues that without the said foreign insurance companies being registered in India with the respondent No.1 IRDA and which they have not chosen to do and are not interested in doing, the appellant cannot be registered with the respondent No.1 IRDA as the agent of the said foreign insurance companies. He thus argues that a piquant situation has arisen where neither is there any provision in the existing laws for registration of the appellant as the agent of the foreign insurance companies nor is the appellant being permitted to carry on the said business / activity. 9. The counsels for the respondents also do not controvert that without the foreign insurance companies being registered, the appellant cannot be registered as their agent. 10. The counsel for the resp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... amble to the Insurance Act describes the same as An Act to consolidate and amend the law relating to the business of insurance as distinct from the business of insurance in India‟, though the applicability of the Act under Section 1(2) is pan India. Section 2C and Section 3 of the Insurance Act, referred to by the IRDA in the impugned order prohibit any person from beginning to carry on any class of insurance business in India‟ save in the manner prescribed therein and without obtaining registration thereunder. The question which next arises is as to what is insurance business‟. 15. Section 2(6A), Section 2(11) and Section 2(13A) define fire insurance business, life insurance business and marine insurance business respectively (but with which we are not concerned). Section 2(13B) defines miscellaneous insurance business as meaning the business of effecting contracts of insurance which are not of fire insurance, life insurance or marine insurance. A contract of insurance is a contract to compensate the loss suffered by the insured on account of risks covered by the insurance policy, in consideration of premium received. 16. Though Section 2(8) of Insurance Act whil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng abroad, to obtain such insurance. We are also unable to find any prohibition in the Insurance Act or the IRDA Act prohibiting Indians from dealing with foreign insurance companies. However, the Foreign Exchange Management (Insurance) Regulations, 2000 prohibit residents of India from taking general or life insurance policy issued by an insurer outside India. The said prohibition also does not extend to medical / accident insurance during the period of travel / stay abroad. The said Regulations also have been amended w.e.f. 5th June, 2003; now residents in India are permitted to hold general as also life insurance policies issued by an insurer outside India, provided the policy is held under a general or specific permission of RBI; no such permission even is required for continuing to hold such policy, if such policy was acquired while such person was resident outside India. The only restriction on such policy holder when premium due is paid by remittance from India, is to repatriate the maturity proceeds or claim amount under the policy, to India. The said Regulations clearly establish that there is no prohibition on the Indians, when abroad, dealing with foreign insurers. 18. W ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... surer can be sued in India. The key words again are insurance business transacted in India‟. Moreover, the objects and reasons of the Amending Act of the Year 1944 by which proviso aforesaid was added to Section 46 show that the proviso was added to remove the defect in the said provision which was seriously interfering with the normal business of marine insurers in as much as marine insurance contracts were international in scope and affected mostly for the benefit of consignees abroad who have option of stipulating place where contracts are intended to be carried out. What applies to marine insurance equally applies to insurance policy which we are concerned with. 21. Even otherwise in exercise of our powers under Article 226 of the Constitution of India, we deem it our duty to address the inconvenience caused to the citizens of India or to other persons who travel to Ukraine and Belarus from India, by depriving them of the facility of obtaining VISA and buying the mandatory insurance policy, from India and in compelling them to travel to the said countries without VISA and which is riddled with inherent uncertainties, and to acquire VISA and Insurance on landing, at three ..... X X X X Extracts X X X X X X X X Extracts X X X X
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