Hidayatullah, J. - (1.) This appeal arises out of two orders of the Life Insurance Corporation Tribunal, Nagpur dated December 30 1959 and May 17, 1960. The National Insurance to. Ltd. is the appellant and the Life Insurance Corporation Of India the respondent.
(2.) The Life Insurance Corporation Act, 1956 (31 of 1956) was passed to provide for the nationalisation of life insurance business in India by a transferring all such business to a Corporation to be established for the purpose and to provide for regulation and control of the business of that Corporation and for matters conceded therewith or incidental thereto. The Life Insurance Corporation is that Corporation. It took over the life insurance business of the National Insurance Co. Ltd., among other companies, and the two broad questions on which the present dispute has arisen are:what part of the business of the appellant Company vest in the Corporation and what are the assets of that business
(3.) The Life insurance (corporation Act provided that the Corporation would be established with effect from such date as the Central Government by a notification in the Official Gazette might appoint. 1st September, I956 was notified that date. The Act defined the expression "appointed day' as the date on which the Corporation was to be established and the 1st of September, 1956, also became the "appointed day" for the purposes of the Act. Section 7(1) of the Act then enjoined that on the appointed day there shall be transferred to and vested in the Corporation all the assets and liabilities appertaining to the '"controlled business" of all insurers. Prior to the Act an Ordinance was Passed by the President (Ordinance No.1 of 1956 and a Custodian appointed thereunder had already taken over management of such business of the insurers as was to vest later in he Corporation as the "Controlled business'. Under sub-section (2) of S.7 the assets of the controlled business included all rights and powers and all property, whether movable or unmovable, including in particular cash balances reserve funds, investments, deposit and all interests and rights in and arising out of such properties as may be in the possession of the insurer and all books of accounts and documents relating to the controlled business of the insurer. Similarly liabilities were deemed to include all debts liabilities and obligations of whatever kind then existing and appertaining to the controlled business of the insurer. An Explanation to S. 7 reads: "Explanation-The expression "assets appertaining to the controlled business of an insurer" - (a) in relation to a composite insurer, includes that part of the paid-up capital of the Insurer or assets representing such part which has or have been allocated to the controlled business of the insurer in accordance with the rules made in this behalf; (b)********** " The expression Rs. 'composite insurer" was defined to mean "An insurer carrying on in addition to controlled business other-kind of insurance business." "Controlled business", in so far as relevant to our purpose, was defined as follows: "2(3) "Controlled business" means - (i) in the case of any insurer specified in sub-clause (a) (ii) or sub-clause(b) or Clause (9) of section 2 of the insurance Act and carrying on life Insurance business- (a) all his business, if he carries on no other class of insurance business; (b) all the business appertaining to his life insurance business, if he carries on any other class of insurance business also; ********** Explanation-An insurer as said to carry on no class Of insurance business other than life insurance business if, in addition to life insurance business, he carries on only capital redemption business or annuity certain business or both; and the expression "business appertaining to his life insurance business" in sub-clauses (i) and (ii) shall be construed accordingly; ********** " ;