Radheshyam Bhagchand Taori vs New India Assurance Company Ltd. ...
2016 Latest Caselaw 6101 Bom

                                                        1                                    judg. wp 2904.09.odt 

               IN THE HIGH COURT OF JUDICATURE AT BOMBAY,
                         NAGPUR BENCH, NAGPUR.




                                                                                                        
                                WRIT PETITION No.2904/2009




                                                                              
    Radheshyam Bhagchand Taori,
    Aged 54 years, Occ.-Retired,
    R/o.-Plot No.132, Laxmi Nagar, Nagpur.                           PETITIONER




                                                                             
                                                 .....VERSUS.....


    1]       New India Assurance Company Ltd.,




                                                             
             through its Chairman and Managing Director, 
             87, MG Road, Fort, Mumbai.
    2]       New India Assurance Company Ltd., 
             through its Chief Regional Manager, 
                                      
             Dr. Ambedkar Bhawan, 4th Floor, High Land Rise, 
             Seminary Hills, Nagpur.

    3]       The Government of India,
             Ministry of Finance (Department of Financial Services), 
           


             Insurance Division, New Delhi.                               R
                                                                             ESPONDENTS
                                                                                       
        



                           Shri B.G. Kulkarni, Advocate for the petitioner.
                     Shri A.J. Pophaly, Advocate for the respondent nos.1 and 2.





                                                     Coram : Smt. Vasanti  A  Naik  & 
                                                                   Kum. Indira Jain, JJ.

Dated : 17 October, 2016.

th

ORAL JUDGMENT (Per Smt. Vasanti A Naik, J.)

By this Writ Petition the petitioner has sought a direction against the

respondent-Insurance Company to grant the benefit of revision of pay scale to

the petitioner. The petitioner has challenged the action on the part of the

respondents of recovering certain amount from the petitioner towards the

commission recovery, audit recovery and interest.

2 judg. wp 2904.09.odt

Shri Kulkarni, the learned Counsel for the petitioner fairly states that

the first prayer made by the petitioner in regard to the revision of pay scale

needs to be rejected as the Hon'ble Supreme Court has rejected a similar

prayer made by similarly situated employees of the respondent-Insurance

Company. It is stated that the Writ Petition would survive in respect of the

prayers for the recovery made in pursuance of audit recovery, commission

recovery and towards interest.

It is stated that the petitioner was working as a Development Officer

with the respondent-Insurance Company when the petitioner stood

voluntarily retired from service in the year 2006 in pursuance of the Special

Voluntary Retirement Scheme. It is stated that after the petitioner stood

retired from service, the respondent-Insurance Company has recovered certain

amount from the petitioner towards commission recovery and audit recovery.

It is stated that the issue whether the respondent-Insurance Company could

have made the commission recovery from the retiral benefits of the

Development Officer came up for consideration in Writ Petition Nos. 2393 of

2009 and 2410 of 2009 and this Court has held, by the judgment dated

17-10-2016 that the commission recovery could not have been effected

without granting an opportunity to the petitioners in the said Writ Petitions. It

is stated that a similar view is taken by this Court in respect of the orders of

audit recovery in the case of the petitioners in Writ Petition Nos.2907 of 2009

and 2908 of 2009 that are decided on 17-10-2016. It is stated that the

petitioner has secured a loan from the respondent-Insurance Company for

construction of the house. The loan amount was recovered from the retiral

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benefits of the petitioner at the time of his retirement in the year 2009, that is,

prematurely before the expiry of the stipulated date on which the amount was

lastly due and payable. It is stated that certain amount is recovered from the

petitioner towards interest by deducting the said amount from his retiral dues.

It is stated that the respondent-Insurance Company could not have deducted

the amount of interest from the petitioner's retiral benefits without hearing the

petitioner.

Shri Pophaly, the learned Counsel for the respondent nos.1 and 2 does

not dispute the statements made on behalf of the petitioner. It is however

stated that the recovery of interest cannot be said to be bad in law as the loan

was repayable till the year 2013 and the installments were fixed accordingly.

It is stated that since the amount is recovered in the year 2009 the Insurance

Company has suffered loss towards interest and that amount was recovered

from the petitioner. It is stated that in this background, till the matter in

respect of the liability of the petitioner to pay interest is decided by the

respondents, they may not be directed to refund the amount recovered from

the petitioner towards interest.

Since the petitioner was admittedly not granted an opportunity before

the amounts were recovered from the pensionary benefits of the petitioner

towards commission recovery and audit recovery, the action on the part of the

respondent-Insurance Company in that regard is liable to be set aside and it

would be necessary to direct the respondent-Insurance Company to repay the

amount to the petitioner in respect of the commission recovery and audit

4 judg. wp 2904.09.odt

recovery within four weeks from the date of submission of an undertaking by

the petitioner that the petitioner would immediately pay the amount to the

respondent-Insurance Company if the order of commission recovery and audit

recovery is upheld. It would also be necessary to direct the respondents to

grant an opportunity to the petitioner in the matter of recovery of interest.

Hence, for the reasons aforesaid the Writ Petition is partly allowed. The

orders of audit recovery, commission recovery and interest recovery are hereby

quashed and set aside. In the circumstances of the case, the respondents are

free to take appropriate action against the petitioner after granting an

opportunity to him. The respondents are directed to refund the amount

recovered from the petitioner towards audit recovery and commission recovery

within four weeks from the date of submission of the undertaking by the

petitioner within three weeks that the petitioner would repay the said amount

to the respondents if the petitioner ultimately fails in satisfying the

respondents against the recoveries. If the respondents take a decision that

interest was not recoverable from the petitioner, after granting an opportunity

to the petitioner, the respondents should repay the amount recovered from

the petitioner towards interest on the loan amount, at the earliest.

Rule is made absolute in the aforesaid terms with no order as to costs.

                                   JUDGE                                               JUD
                                                                                          GE
                                                                                             




    Deshmukh