The General Insurance Business (Nationalisation) Act, 1972

This Act may be called the General Insurance Business (Nationalisation) Act, 1972.

It is hereby declared that this Act is for giving effect tothe policy of the State towards securing the principles specified in clause (c) of article 39 of theConstitution. Explanation.-- In this section, "State" has the same meaning as in article 12 of the Constitution.

In this Act, unless the context otherwise requires, (a) acquiring company means any Indian insurance company and, where a scheme has beenframed involving the merger of one Indian insurance company in another or the amalgamation of twoor more such companies, means the Indian insurance company in which any other company has beenmerged or the company which has been formed as a result of the amalgamation; (b) appointed day means such day not being a day later than the 2nd day of January, 1973, asthe Central Government may, by notification, appoint; 1[(ba) “board of directors” or “board”, in relation to a specified insurer, shall have the same meaning as assigned to it in clause (10) of section 2 of the Companies Act, 2013 (18 of 2013);] (c) Companies Act means 2[the Companies Act, 2013 (18 of 2013)]; (d) Corporation means the General Insurance Corporation of India formed under section 9; (e) existing insurer means every insurer the management of whose undertaking has vested inthe Central Government under section 3 of the General Insurance (Emergency Provisions) Act, 1971(17 of 1971), and includes the undertaking of the Life Insurance Corporation in so far as it relates tothe general insurance business carried on by it; (f) foreign insurer means an existing insurer incorporated under the law of any country outsideIndia; 3[(g) “general insurance business shall have the same meaning as assigned to it in the Insurance Act, 1938 (4 of 1938);] (h) Government company means a Government company as defined in 4[ clause (45) of section 2] of theCompanies Act; (i) Indian insurance company means an existing insurer having a share capital who is acompany within the meaning of the Companies Act; (j) Insurance Act means the Insurance Act, 1938 (4 of 1938); (k) Life Insurance Corporation means the Life Insurance Corporation of India established underthe Life Insurance Corporation Act, 1956 (31 of 1956); (l) notification means a notification published in the Official Gazette; (m) prescribed means prescribed by rules made under this Act; (n) Schedule means the Schedule to this Act; (o) scheme means the scheme framed under section 16 5[and also includes a scheme framedunder section 17A;] 6[(oa) “specified insurer” means the Corporation as defined in clause (d) or any of the insurance companies specified in section 10A;] (p) words and expressions used in this Act but not defined herein and defined in the InsuranceAct, shall have the meanings respectively assigned to them in that Act; (q) words and expressions used in this Act but not defined herein or in the Insurance Act anddefined in the Companies Act, shall have the meanings respectively assigned to them in theCompanies Act.

(1) On the appointed day, all the shares inthe capital of every Indian insurance company shall, by virtue of this Act, stand transferred to and vestedin the Central Government free of all trusts, liabilities and encumbrances affecting them. (2) Out of the shares so transferred and vested, the Central Government shall, immediately thereafter,by notification, provide for the transfer of not less than ten shares of every such company to such personsas may be specified in the notification to enable the Indian insurance company to function as aGovernment company. (3) Every notification made under sub-section (2) shall specify the names and description of thepersons to whom the shares are transferred and the particulars of the shares which are transferred to eachsuch person. (4) A copy of every notification made under sub-section (2) shall, as soon as may be after it is made,be sent by the Central Government to the concerned Indian insurance company, who shall, on receipt ofsuch copy, and notwithstanding anything contained in the Companies Act or in its articles of association,forthwith rectify its register of members by including therein the persons mentioned in the notification asthe holders of the shares specified therein. (5) For the removal of doubts it is hereby declared that the transfer and vesting of shares effectedunder sub-section (1) shall not be deemed to affect any right of the Indian insurance company subsistingimmediately before the appointed day against any shareholder to recover from him any sum of money onthe ground that that shareholder has not paid or credited to the insurer the whole or any part of the valueof the shares held by him or on any other ground whatsoever.

(1) On the appointed day, the undertakingof every existing insurer who is not an Indian insurance company shall stand transferred to and vested inthe Central Government and the Central Government shall immediately thereafter provide, bynotification, for the transfer to and vesting in such Indian insurance company, as it may specify in thenotification, of that undertaking. (2) Any notification made under sub-section (1) may provide that any of the undertakings aforesaidmay be transferred to and vested in more than one Indian insurance company in such manner and subjectto such conditions as may be specified in the notification.