IRDAI Top Official Aided, Abetted Corruption, Says SAT
SAT has ordered Irdai for fresh hearing in the matter of illegal diversion of reinsurance business to broking firm.
The Securities Appellate Tribunal has set aside an order passed by the Insurance Regulatory and Development Authority of India (IRDAI), in a case filed by U.K.-based Atkins Special Risks, an insurance broker, and said the insurance regulator’s member P J Joseph “aided and abetted” corruption.
The Tribunal, in an order issued on Friday, has asked the insurance regulator to issue fresh order in the case by another adjudicating officer.
The case dates back to 2015, when U.K.-based reinsurance firm had filed a case with the insurance regulator alleging that Jagson International Ltd. Chairman Jagdish Gupta, had unlawfully diverted their reinsurance business to another broking firm, Marsh India Insurance Brokers.
According to Atkins, Gupta had written emails to the firm demanding a cut from their earned commission which they declined. After this, their reinsurance business was diverted to Marsh, which as alleged by Atkins had offered a kick-back worth $4,00,000 to Gupta for securing the business.
The case was dismissed by PJ Joseph, member (non-life), via an order passed Jan. 9 on grounds of lack of documentary evidence to support Atkin’s plea. SAT, however, has called this order a ‘gross abuse of the process of law and dereliction of duty.’
Without passing an order in the matter, SAT has re-directed the matter to IRDAI for a fresh hearing. It has also observed that considering there was an email trail between Gupta and Atkins that was left unverified, “the impugned order passed by Mr. P. J. Joseph (non-life) virtually amounts to aiding and abetting corruption in the insurance business by the regulator which cannot be tolerated.”