Haryana bans ICICI Prudential Life Insurance

By Haryananewswire

CHANDIGARH, APRIL 17

The Haryana Government has debarred the M/s ICICI Prudential Life Insurance Company Limited for a period of three years from doing any further business with the Government of Haryana or any of its Departments, Public Sector Undertakings or autonomous bodies for intentionally delaying the entire process of distribution of annuity to the land owners and failure to carry out its commitments.

While stating this here today, a spokesman of the Finance Department said that M/s ICICI Prudential Life Insurance Company Limited needed to be blacklisted. He said that the noticee can however opt to pay compounding fee in lieu of entire or a part of the black listing period within one month from the date of this order by paying penal interest at a rate of one per cent for every six months or part thereof of the blacklisting period proposed to be compounded by making a request to the Government in this regard. 

He said that such enhanced rate of interest would be payable on the amount advanced to noticee for the period from date of receipt of advance till the date of repayment of advance and interest at SBI base rate to the Department. Necessary orders for allowing compounding of the black listing period will be passed after receipt of the requisite compounding fee.

He said that since the Government was inclined to honour its commitment under the Rehabilitation and Resettlement (R and R) Policy without any delay and without adverting to the extreme step of cancelling the process, it introduced a via media in the Service Level Agreement (SLA) to the affect that Government of Haryana shall constitute and notify separately a Sub Committee under the Chairmanship of Principal Secretary, Finance, Haryana to consider any operational impediment encountered by the Service Provider while performing their roles and responsibilities to fulfill their obligations hereof. The said Clause 2.3.4 was inserted to enable the Service Provider to proceed to comply with their obligations including collection and validation of data while the Sub Committee so constituted would look after operational impediment. However, even then the noticee failed to execute the SLA.

It may be recalled that an Expression of Interest was issued in February 2011 inviting bids from Insurance Companies and Banks for the purpose of providing services for disbursement of annuity to the land owners under the R and R Policy of Haryana Government. The bid-cum-tender document were submitted by M/s ICICI Prudential Life Insurance Company Limited on March 31, 2011. Thereafter, several rounds of discussions were held between the noticee and the State Government with respect to various stipulations and condition stated in the draft Services Level Agreement including the obligation of the noticee as the Service Provider with respect to collection and validation of data of the beneficiaries under the scheme of annuity. Decision was thus taken on July 25 and August 11, 2011 by the Government for making payment of annuity under R and R Policy by allocation of work amongst the selected insurance companies and letter of intent was issued to noticee vide letter dated September 6, 2011.

In furtherance of the agreed and accepted condition of the letter of intent, the Government vide letter dated January 4, 2012 forwarded the SLA duly approved by it and called upon the noticee to sign the same with its concerned departments. However, despite repeated reminders for execution of the SLA, the noticee failed to execute the same inter-alia again for the same frivolous reasons of non deletion of the clause relating to the collection and validation of data. These objections of the noticee were never accepted by the Government as the same were considered to be primary task given to the bidder or Service Provider and of which the noticee was duly informed too. Thereafter, the noticee M/s ICICI Prudential Life Insurance Company Limited has shown its inability to sign the SLA vide letter dated May 2, 2012.

The M/s ICICI Prudential Life Insurance Company Limited was advised in a meeting on July 20, 2012 to collect the data from the concerned departments. Thereafter too, nobody from M/s ICICI Prudential Life Insurance Company Limited approached the departments to collect the data. Further, vide letter dated September 7, 2012, the bidder, the M/s ICICI Prudential Life Insurance Company Limited again expressed their unwillingness to provide the desired services.

He said that the conduct of the noticee of refusing to execute the SLA defeated a very laudable policy of the Government undertaken to realise the pious Constitutional aim of public good. Therefore, the Government after much deliberations withdrew and cancelled the bid awarded to the noticee in terms of order dated September 6, 2011. He said that on November 22, 2012, the noticee was called upon to show cause as to why stringent actions including but not limited to debarring M/s ICICI Prudential Life Insurance Company Limited from doing any further business with Haryana Government or any other Department be taken for delaying the entire process of distribution of annuity to the land owners and such other action available with the Government of Haryana under applicable law be initiated. The Government received the reply from the noticee on December 21, 2012. In its reply, the noticee denied any wrongful act or failure on its part. Personal hearing was also given to the bidder on January 31, 2013, but the reply given by the noticee was totally unsatisfactory and did not carry any merit.