- (1.) HEARD counsel for the petitioner. The order dated 16.4.2007 passed by the Permanent Lok Adalat, East Singhbhum, Jamshedpur in PLA Case No.24 of 2007 has been challenged by the petitioner whereunder the learned court has awarded a sum off Rs.73,000/ to the claimant sole respondent to be paid within two months, failing which the Insurance Company i.e. the petitioner would be liable to pay interest @ 12% per annum. The said amount has been awarded in lieu of two LIC Policies. It is submitted on behalf of petitioner that the insured died on 23.6.2005 when the policies were not in force, however premium in respect of the above two policies were deposited on 28th June,2005 concealing the factum of death of said Budhan Singh. These facts were detected during the settlement of the claim application of the claimant/sole respondent. It is submitted that the claimant, however, preferred pre litigation case before the Permanent Lok Adalat i.e. Case No.24/2007 for settlement of dues arising out of two policies. The Insurance Company as well as agent were issued notice. The Insurance Company filed a written statement and contested the claim raising the aforesaid fact that the policies had lost their force before the death of the insured and by concealing the factum of his death a premium was deposited on 28th June,2005. It is submitted that the learned PLA Court proceeded to decide the dispute on merit without following the procedure and provisions as laid down under Sections 22(c)(4) to (7) of LSA Act,1987. It is also submitted that no efforts for compromise or settlement were made by the Permanent Lok Adalat before passing the impugned award on merit.
(2.) LEARNED counsel for the petitioner has, therefore, assailed the impugned award on the aforesaid ground stating that it is wholly without jurisdiction having failed to follow the procedure established under the law and upheld by this Court in several judgments. Further the claim of the sole respondent was untenable on the facts as the policies had expired on account of non -deposit of premium by 28th April,2005 and the insured having died on 23rd June,2005. He, therefore, submits that the impugned award requires to be set aside . The respondent was issued notice, who entered appearance through her counsel but neither any counter affidavit has been filed nor any one appeared on her behalf today to contest the case. The matter was adjourned earlier on number of occasions. Therefore, it is being heard and decided today after hearing the counsel for the petitioner. The facts, which have been indicated hereinabove and are borne from the records including the written statement of the petitioner Insurance Company as also the impugned order show that the two insurance policies have been taken by late Budhan Singh from the petitioner Insurance company for Rs.30,000/ and Rs.40,000/ on 28.1.2004 with conditions for making payments by premium as fixed thereunder by 28th January, 28th April, 28th July and 28th October every year. The premium fell due on 28th April,2005 was not paid in one month grace period till 28May,2005 and the policies lost force. The insured died on 23.6.2005 and thereafter the premium was deposited in respect of two policies on 28th June, 2005 concealing the factum of death of the insured.
(3.) IN sum and substance, in the PLA Case No.24/2007, the petitioner -Insurance company appeared on notice and contested the claimant 'sapplication on merit. The Permanent Lok Adalat has statutory obligation to make all efforts to enable parties to come to a compromise and settle the dispute and only on failure to do so, the Permanent Lok Adalat should decide the issue on merit under Section 22(c)(8) of the Act,1987. On perusal of the impugned award, it appears that no such procedure was followed before deciding the claim on merit, which was seriously contested by the petitioner Insurance company. It further appears that policies have lost their force because of non deposit of timely premium and thereafter the premium was deposited after the death of the insured on 23.6.2005, which was also suppressed. The learned Tribunal has, therefore, committed serious error of law in deciding the dispute on merit in a claim, which was seriously contested by the petitioner Insurance company. Accordingly, keeping into regard the settled principle of law as rendered by the judgment of Single Bench of this Court in the case of State Bank of India, Dhanbad Vs. State of Jharkhand & another, passed in W.P.(C) No.1449 of 2008 vide judgment and order dated 9.4.2009 and a Division Bench judgment of this Court in the case of Oriental Insurance Company Ltd., Kutchery Road, Ranchi Vs. Bodya Oraon and another, Passed in WP(C) No.1975 of 2007 vide judgment and oder dated 30.4.2012, the impugned award requires to be interfered with in exercise of power under Articles 226 and 227 of the Constitution of India.;