MAHADASA BRAMMAMMA Vs. KANDULA VENKATARAMANA RAO

JUDGEMENT

(1.) This appeal raises a question relating to the interpretation of 5ection 39 of the Indian Insurance Act. The facts leading up to this may be briefly narrated : One Atcbutaramayya executed a promissory note in favour of the appellant on 4th December, 1950. On the foot of this document, a decree was obtained by the appellant on 28th November, 1952, against the 1st and 2nd respondents, i.e., the widow and the son of the debtor who died some time during the pendency of the suit. In execution of the decree the appellant sought to attach a policy taken by Atchutaramayya on his own life in the United India Life Assurance Company. The widow raised an objection that she having been nominated under section 39 of the Insurance Act was entitled to the proceeds thereof and the creditor of her husband has no right to proceed against it. This objection weighed with the Courts below and the execution petition was dismissed. Being aggrieved by this decision, the decree-holder has come up to this Court in second appeal.

(2.) The contention urged by Mr. Choudhry in support of the appeal is that the Life Insurance Policy remained an asset of Atchutaramayya in the hands of his legal representatives which can be proceeded against in execution of a decree obtained against his estate. The point involved in this appeal has to be answered with reference to the provisions of section 39 of the Insurance Act, the relevant portion of which is extracted below :-

(3.) A reading of the relevant provisions of the section can only lead to a conclusion that the holder of the policy continues to have interest in the policy notwithstanding the nomination effected in regard to the policy. It d.oes not divest him of the rights in the policy and. he retains disposing power over it. Under sub-section 2 and sub-section 4 it is competent for the holder of the policy to bequeath to somebody or make an assignment of it and this automatically cancels the nomination which implies that a nominee has no vested right in the document. In fact, under sub-section 5, if the policy-holder survives the nominee, the money was payable to the holder himself and not to the heirs or the legal representatives of the nominee which would not be the case if the nominee had acquired any vested interest in the policy. Therefore, the title does not pass to the nominee by reason of the nomination. Consequently, the nominee gets the property in the policy subject to all the liabilities of the policy-holder. The Courts below thought that by virtue of section 6 of the Married Women's Property Act the widow of the policy-holder was entitled to get the benefit cf the nomination and consequently receive the amount from the Insurance Company. Section 6 of the Married Women's Property Act recites :