MUMBAI, MAY 22: A three-judge division bench of the Calcutta high court has granted a partial stay on the directive of justice Satyabrata Sinha on third-party motor premium and on the reconstitution of the Tariff Advisory Committee (TAC).

The interim order of the division bench has restrained the committee from revising its premium till a final verdict is delivered. It has also said that the committee could continue in its present form.

Earlier, on May 15, the single-judge bench presided by justice Sinha had struck down the notification of the committee by which subsidiaries of General Insurance Corporation sought to increase the premium on third-party insurance for vehicles from May 1.

Justice Sinha had also ruled that the committee needs to be reconstituted by appointing the controller of the insurance as the chairman of the statutory body.

The judgement followed a petition by the Mini Bus Operators' Association of Calcutta and Howrah challenging the order to revise the premium rates. The association had also called for changes in the constitution of the committee.

The association had said that the chairman of the GIC should not be allowed to officiate as the chairman of the committee as he was a part of the industry.

The committee, however, appealed to the division bench for the stay of justice Sinha's ruling on May 16.

According to committee officials, though the judgement has restricted the statutory body from revising the rates, it could continue renegotiations with the operators to arrive at a consensus about the rate of hike.

``Though we will wait till the jury delivers the final verdict, we will continue with the negotiation with a different set of operators in different cities,'' a top official of the committee said. The committee had earlier set a deadline of July 1 for implementing the revision.

Justice Sinha had ruled that the notification effecting the revision was ultra vires and therefore bad in law and unenforceable.

Copyright © 1997 Indian Express Newspapers (Bombay) Ltd.