MUHAMMAD SAJID MEHMOOD SETHI, J.: This consolidated judgment shall dispose of instant writ petition along with following connected writ petitions as common questions of law and facts are involved in these cases: W. P. No.8816 of 2014.
State Life Insurance Corporation of Pakistan v. The Additional District Judge-1, Lahore & another.
W. P. No.8919 of 2014.
State Life Insurance Corporation of Pakistan v. The Additional District Judge-1, Lahore & another.
W. P. No.13458 of 2014.
State Life Insurance Corporation of Pakistan v. The Additional District Judge-1, Lahore & another.
W. P. No.30906 of 2014.
State Life Insurance Corporation of Pakistan v. The Additional District Judge-1, Lahore etc. W. P. No.31511 of 2014.
State Life Insurance Corporation of Pakistan v. The Additional District Judge-1, Lahore etc. W. P. No.31512 of 2014.
State Life Insurance Corporation of Pakistan v. The Additional District Judge-1, Lahore etc.
2. Brief facts for disposal of this writ petition are that the deceased wife of respondent No. 2, namely, Jameela Kausar, purchased two life insurance policies from petitioner. Respondent No.2 has been named as her nominee. The policy-holder died on 25.06.2009. Respondent No.2 lodged a death claim thereafter, being nominee in the insurance policy, which claim has been repudiated by petitioner. Respondent No.2 assailed this repudiation of insurance claim, before respondent No.1, which is still pending adjudication. Petitioner filed an application under Section 162 (2) of the Insurance Ordinance, 2000 ("Ordinance"), read with Order 7 Rule 11 CPC for rejection of the insurance application being not maintainable, as having been filed without previous sanction of the Securities & Exchange Commission of Pakistan ("SECP"), in terms of Section 162 of the Ordinance. Petitioner's application has been dismissed by respondent No.1 vide order dated 28.01.2014. Through the instant petition, petitioner has assailed the aforesaid order, with the following prayer:- "a) The impugned Order dated 28.01.2014 passed by the respondent No.1 while exercising powers of Insurance Tribunal Punjab may please be declared illegal, arbitrary and ultra vires of the provision of Insurance Ordinance 2000 being passed without lawful authority and consequently of no legal effect. b) The writ petitioner's application filed under Section 162 (2) of the Insurance Ordinance 2000 read with Order 7 rule 11 CPC for rejection of insurance application filed by the respondent No.2 may please be accepted. c) Any other relief, which this Hon'ble Court may deem fit and appropriate, may also be awarded to the writ petitioner against the respondents to meet the ends of justice."
3. Learned counsel for petitioner submits that prior permission / sanction of the SECP is mandatory before initiating any proceedings before the Insurance Tribunal against an insurer, in terms of Section 162 of the Ordinance. In this regard, learned counsel for petitioner has relied upon Muhammad Huzafa v. American Life Insurance Company (Pakistan) Ltd. (ALICO) through Chairman / General Manager / Managing Director and another (2013 CLD 1470). He further submits that impugned order has been passed in violation of Section 162 of the Ordinance and case law referred above. In support of his contention, learned counsel for petitioner has further relied upon Syed Saghir Ahmad Naqvi v. Province of Sindh through Chief Secretary, S & GAD, Karachi and another (1996 SCM R 1165) and UBL Insurers Limited v. Ashiq Hussain and another (2014 CLD 1155).
4. On the other hand, learned counsel for respondent No.2 submits that Section 162 of the Ordinance falls in Part XIX (Offences and Penalties) of the Ordinance. This part starts from Section 156 and the last Section of this part is 163. He further submits that only in criminal prosecution, prior permission / sanction of SECP is required, and it is not required for filing insurance claims in the Insurance Tribunal. Learned counsel for respondent No.2 has relied upon Ismail Ebrahim Alloo and others v. The State (PLD 1959 (W,P.) Karachi 440), State Life Insurance Corporation of Pakistan & 04 others v. Mst. Sartaj Begum (R.F.A. No.43 of 2009), Muhammad Huzafa v. American Life Insurance Company (Pakistan) Ltd. (ALICO) through Chairman / General Manager / Managing Director and another (2013 CLD 1470) (referred above), Surendra Nath Sarkar and others v. Kali Pada Das (AIR 1940 Calcutta 232), Jaswa ntray Manilal Akhaney v. State of Bombay (AIR 1955 Bombay 259), and National Insurance Company Ltd. v. Narendra Kumar Jhanjhri (1990 Cri LJ 773).
5. Arguments have been heard and record perused.
6. It is evident from bare reading of the scheme of Insurance Ordinance, 2000, that the Insurance Tribunal and its jurisdiction for entertaining insurance claim is dealt in Part XV of the Ordinance, starting from Section 121 to 124. Section 121 deals with constitution of the Tribunal, Section 122 relates to power of Tribunal, Section 123 lays down procedure of Tribunal for trial of an application and Section 124 provides right of appeal to the aggrieved person against decision of Tribunal before High Court. Provision of Section 122 clearly lays down that the tribunal shall, in its exercise of civil jurisdiction, in respect of a claim filed by a policy-holder against an insurance company, in respect of or arising out of a policy of insurance, all the powers vested in a Civil Court under the Code of Civil Procedure, 1908 ("CPC"). Provision of Section 122 (3) says that no Court other than a Tribunal shall have or exercise any jurisdiction with respect to any matter to which the jurisdiction of a Tribunal extends under this Ordinance, including a decision as to the territorial limits and the execution of a decree, order or judgment passed by a Tribunal. The Tribunal, for the purpose of trial of an application, follow such procedure as may be prescribed and have the same powers as are vested in a Civil Court trying a suit under the CPC, in respect to summoning and enforcing the attendance of any person examining him on oath, requiring the discovery and production of documents and material object, receiving evidence on affidavits, and issuing commission for the examination of witnesses or documents.
7. The concept of prior sanction is basically linked with a criminal prosecution. Provisions which govern the criminal offences and penalties are in Part XIX of the Ordinance. It starts from the provision of Section 156 to Section 163 of the Ordinance. Section 156 deals with penalty for default in complying with, or acting in contravention of this Ordinance, Section 157 provides penalty for transacting insurance business in contravention of Sections 5, 6 and 29, Section 158 lays down penalty for false statement in document, Section 159 states wrongfully obtaining or withholding property, Section 160 stipulates power of Tribunal to order restoration of property of insurer or compensation in certain cases, Section 161 relates to notice to Commission and hearing. Section 162 deals with prior sanction of commission for institution of proceedings and Section 163 deals with power of Court to grant relief. Provision of Section 162 of the Ordinance is reproduced as under:- "162. Previous sanction of Commission for institution of proceedings.---
(1) Except where proceedings are instituted by the Commission no proceedings under this Ordinance against an insurer or any director, manager or other officer of an insurer shall be instituted by any person unless he has previous thereto obtained the sanction of the Commission (which shall not unreasonably be withheld) to the institution of such proceedings.
(2) Where the proceedings are not initiated by the Commission or the Commission have not been made a party, the Tribunal shall before proceeding further in the matter give notice to the Commission and shall not proceed to hear and decide the matter without giving the Commission the opportunity of participating in the proceedings and being heard".
Reading the Section 162 in juxtaposition with other provisions, starting from Section 156 to Section 163 of the Ordinance, makes it clear that prior sanction is confined to criminal prosecution against insurance companies or its employees, as mentioned therein. It is not for the purpose of filing insurance claims. Had it been so, it could have been clearly mentioned in the relevant provisions dealing with the insurance claims. The object of the legislature seems to be very clear that prior sanction is required for initiating criminal proceedings under Chapter XIX of the Ordinance, which governs the criminal offences and penalties.
8. Perusal of impugned order also indicates that learned Insurance Tribunal has specifically noted that in Part XIX of the Ordinance, the concept became very clear as these provisions relate to other proceedings / disputes against insurance company or its Directors or officers, whereas the provisions relating to the claims of insurance are neither subservient to the provisions of Section 162 of the Insurance Ordinance, 2000, but independent, nor any prior permission from SECP is necessary, for filing of the insurance claims in the Insurance Tribunals.
9. The established principle of interpretation of statutes is that no provision of law, contained in a statute, is to be considered in isolation, until and unless any Section / provision is a complete code in itself and any scheme contained in statute is to be considered in totality of the scheme. Thus, adhering to this principle, the Court has to consider all the relevant provisions of Insurance Ordinance, 2000. One provision of the Section is not to be considered ignoring its other provisions.
Provisions of Section 162 which mandates prior sanction are not to be applied in isolation but simultaneously in juxtaposition to other Sections starting from Section 156 to 163. Statute is to be interpreted by making it consistent with the scheme of the Ordinance. It has to be read as a whole and not in bits and pieces. Law is to be interpreted and applied rationally, fairly and not arbitrarily.
10. It is settled law that where literal construction or plain meaning causes hardship, futility, absurdity or uncertainty, the purposive or contextual construction is preferred to arrive at a more just, reasonable and sensible result. Every law is designed to further the ends of justice and not to frustrate it on mere technicalities. Though the function of the Court is only to interpret the law and not to legislate, nonetheless the legislature cannot be asked to sit to resolve the difficulties in the implementation of its intention and the spirit of the law. In such circumstances, it is the duty of the Court to mould or creatively interpret the legislation by liberally interpreting the statute. The statutes must be interpreted to advance the cause of statute and not to defeat it. There is consensus that a remedial enactment is intended to provide relief which was not already provided for. The remedy is to obviate a defect, anomaly or hardship, and is designed to bring the existing law in line with the intention of the legislature. It is the duty of Court to interpret the various provisions of statute harmoniously in order to advance the remedy. It has to construe the law beneficial for the said purpose.
11. Any other interpretation of provision of Section 162 of the Ordinance leads to suppression of remedy that does not seem to be in conformity with the provisions of Articles 2-A, 3, 4, 5, 9, 18 & 23 of the Constitution of the Islamic Republic of Pakistan, 1973, and that will give undue advantage and edge to the Insurance Company over the bone fide claimant.
12. Learned counsel for petitioner has placed reliance upon the case of Muhammad Huzafa supra, to contend that no proceedings can be conducted without prior sanction of the commission under Section 162 of the Ordinance. The operative part of the said judgment reads as under:- "4. The contention of learned counsel for petitioner has got no force because the provisions of section 162 of the Insurance Ordinance are very much clear and unambiguous and no proceedings can be conducted without the sanction of the Commission. The provision of section 162 is reproduced as under:- "Except where proceedings are instituted by the Commission no proceedings under this Ordinance against an insurer or any Director, Manager or other Officer of an insurer shall be instituted by any person unless he has previous thereto obtained the sanction of the Commission (which shall not unreasonably be withheld) to the institution of such proceedings."
5. So, it is obvious from the above mentioned provision of section 162 of the Insurance Ordinance, 2002 that no proceedings shall be lodged by any person without previous sanction of the Commission (i.e. SECP). Thus, we hold that the impugned order of learned insurance Tribunal is perfectly in accordance with law and legal provision, hence, warrants no interference by this Court in exercise of Constitutional jurisdiction."
I have carefully gone through the said judgment. Learned counsel for respondents has brought to my notice another judgment passed by learned Division Bench of Hon'ble Peshawar High Court, Peshawar, in R.F.A. No.43 of 2009, titled State Life Insurance Corporation of Pakistan & 04 others v.
Mst. Sartaj Begum, vide dated 31.01.2012, the operative part of which reads as under: "So far as the second objection is concerned that permission was not obtained from the Commission, that is based on misconception because that relates to the other disputes against Insurance Company or its Directors or Officers and does not speak about such claims of Insurance and this was also rightly discarded by the Tribunal."
14. It appears that the above judgment passed by learned Division Bench of Hon'ble Peshawar High Court, Peshawar, has not been brought to the notice of another learned Division Bench of the same Court in the case of Muhammad Huzafa supra.
15. In my humble opinion, the earlier view of learned Division Bench of Hon'ble Peshawar High Court, Peshawar, given in the case of State Life Insurance Corporation of Pakistan (supra), seems to be more in conformity with the provisions of Section 162 read with all other enabling provisions of the Insurance Ordinance, 2000.
16. Resultantly, the instant writ petition along with connected petitions have no merits and the same are hereby dismissed with no order as to cost.