Case Title: Insurance Regulatory And Development Authority Of India V. Sahara India Life Insurance Company Limited, Civil Appeal No(s). 4074/2023
Summary
The Securities Appellate Tribunal (SAT) overturned an IRDAI order directing the transfer of Sahara India Life Insurance policies to SBI Life Insurance Company Limited. Sahara India Life Insurance Company Limited appealed the IRDAI’s June 2, 2023 order, which mandated the transfer of Sahara’s bank accounts, books of accounts, and records to SBI Life Insurance. The Supreme Court halted the implementation of the IRDAI’s June 2, 2023 order, stating there was no pressing need to move the Sahara policies to SBI. The Tribunal was instructed to consider the stay request again.
About the Case
The Securities Appellate Tribunal (SAT) order that had suspended an order from the Insurance Regulatory and Development Authority of India (IRDAI) ordering the transfer of policies from Sahara India Life Insurance Company Limited to SBI Life Insurance Company Limited was recently overturned by the Supreme Court.In an appeal filed by the IRDAI, a division bench consisting of Justices Abhay S. Oka and Sanjay Karol delayed the SAT order, referring to it as a “drastic order.”
Sahara India Life Insurance Company Limited filed an appeal with the SAT regarding the ruling issued by the IRDAI on June 2, 2023, directing the transfer of Sahara India Life Insurance policies to SBI Life Insurance Company Limited. It was also mandated that Sahara India Life Insurance’s bank accounts, books of accounts, and other records be moved to SBI Life Insurance. The order of June 2, 2023 was issued by IRDAI ex parte, citing Sahara Life Insurance’s noncompliance with the decision dated December 30, 2020.
The IRDAI issued an order on December 30, 2020, declaring that Sahara Life Insurance was no longer a “fit and proper” promoter and directing that its shareholdings be transferred to another “fit and proper” promoter within a six-month period. It also instructed Sahara Life Insurance to pursue Sahara India for the value of Rs. 78 crore.
There was no pressing need to move the Sahara policies to SBI, according to SAT’s order of June 13, 2023, which halted the implementation of the IRDAI’s June 2, 2023 order.
While restraining the SAT’s order, the Apex Court made it apparent that the Tribunal might continue to hear the appeal on its merits. The Tribunal was instructed by the Supreme Court to consider the stay request again.
