Insurable interest.

68. Repealed by the Insurance (Amendment) Act, 1950

Dividing business

69. (1) No provident society shall carry on any business upon the dividing principle, that is to say, on the principle that the benefit secured by a policy is not fixed but depends either wholly or partly on the results of a distribution of certain sums amongst policies becoming claims within certain time limits, or on the principle that the premiums payable by a policy holder depend wholly or partly on the number of policies becoming claims within certain time limits.

(2) The Authority shall, as so on as possible, take steps to have any provident society which carries on business on dividing principle wound up:

Provided that, where any such provident society in existence at the commencement of this Act applies within three months of such commencement to the Authority for permission to continue carrying on its business with a view meanwhile to reorganise its business in accordance with the provisions of this Act, the Authority may at his discretion, with due regard to the past history of the society, permit the society to continue business for a period not exceeding two years from the date of receipt of such permission, so however that no new business on the dividing principle is undertaken by the society.

(3) Where after the commencement of the Insurance (Amendment) Act, 1941 (13 of 1941), a provident society is to be wound up in pursuance of this section, or where, whether before or after the commencement of that Act, a provident society ceases to carry on business on the dividing principle the provisions of sub sections (2) and (3) of Section 52 shall, so far as may be apply in like manner as they apply to an insurer ceasing to carry on business on the dividing principle.

Registration

70. (1) No provident society except a provident society registered under the provisions of the Provident Insurance Societies Act, 1912 (5 of 1912), shall receive any premium or contribution until it has, obtained from the Authority, before the date of commencement of the Insurance Regulatory and Development Authority Act, 1999, a certificate of registration.

(2) Every application for registration shall be accompanied by:

(a) a certified copy of the rules of the society, and when the society is a company incorporated under the Indian Companies Act, 1913 (7 of 1913) or under the Indian Companies Act, 1882 (6 of 1882), or under the Indian Companies Act, 1866 (10 of 1866), or under any Act repealed thereby,] a certified copy of the memorandum and articles of association or where the society is not such a company a certified copy of the deed of constitution of the society;
(b) the names and addresses of the proprietors or directors, and the managers of the society, the full address of the registered office of the society, the full address of the principal office of the society in India the name of the manager at such office, and the name and address of some one or more persons resident in India authorised to accept any notice required to be served on the society;
(c) a certificate from the Reserve Bank of India that the initial deposit referred to in Section 73 has been made;
(d) a declaration verified by an affidavit made by the principal officer of the society authorised in that behalf that the minimum working capital required by Section 72 is available; and
(e) the receipt showing payment in the prescribed manner of the prescribed fee for registration being not more than two hundred rupees.

(3) The Authority may refuse to issue a certificate of registration until he is satisfied that the rules of the society comply with the provisions of this Act and that the society complies with the provisions of Sections 65 A, 67, 71, 72, 73 and 73 A, but if he is so satisfied he shall register the society and its rules.

(4) The Authority may, after giving previous notice in writing in such manner as he thinks fit specifying the grounds for the proposed cancellation, and allowing the society concerned an opportunity of being heard, apply to the Court and obtain sanction for cancellation of the registration made under this section or made under the provisions of the Provident Insurance Societies Act, 1912 (5 of 1912).—

(a) if he is satisfied from the returns furnished under the provisions of this Act or as the result of an inquiry made under Section 87 - ¬

I. that the society is insolvent or is likely to become so, or

II. that the business of the society is conducted fraudulently or not in accordance with the rules thereof, or that it is in the interests of the policy holders that the society should cease to carry on business, or

(b) if the society, having failed to comply with any requirement or having contravened any provision of this Act, has continued such failure or contravention for a period of one month after notice of such failure or contravention has been conveyed to the society by the Authority:

Provided that the Authority may, if he thinks fit, instead of applying for cancellation of the registration under sub clause (i) of C1ause (a) of this sub¬section make a recommendation to the Court that the contracts of the society should be reduced in such manner and subject to such conditions as he may indicate:

Provided further that the Authority may, without previous notice and without application to the Court for sanction,—

(a) cancel the registration of a provident society which has failed to have its registration renewed, or

(aa) cancel the registration of a provident society if any deposit required by Sec. 73 has not been made, or

(b) cancel' on such terms and conditions as he thinks fit, the registration of any provident society which applies to him for such cancellation if he it satisfied that the society has ceased to carry on insurance business and the all its liabilities in respect of insurance policies are either satisfied or otherwise provided for, or

(c) cancel the registration of a provident society if he has reason to believe that any claim upon the society arising in India under any policy of insurance remains unpaid for three months after final judgment in regular course of law.

(5) When a registration is cancelled the provident society shall not, after the cancellation has taken effect, enter into any new contracts of insurance, but all rights and liabilities in respect of contracts of insurance entered into by it before such cancellation takes effect shall, subject to the provisions of Section 88, continue as if the cancellation had not taken place.

(6) Where a registration is cancelled under Clause b of sub section (4), or C1ause (c) of the second proviso to that sub section, or because the society has failed to have its registration renewed, the Authority may at his discretion revise the registration of the provident society, within six months from the date on which the cancellation took effect, makes the deposits required by Section 73 or satisfies the Authority that no claim upon it such as is referred to in the said C1ause © remains unpaid, or has had an application under sub section (3) of Sec. 70A accepted, as the case may be, and complies with any directions which may be given to it by the Authority.

(7) The Authority may, on payment of the prescribed fee which shall not exceed five rupees, issue a duplicate certificate of registration to replace a certificate lost, destroyed or mutilated, or in any other case where he is of opinion that the issue of a duplicate certificate is necessary.