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CS Professional · Banking and Insurance - Laws and Practice · Inspection, Investigation, Penalty and Appellate Procedure

After inspecting Ganga General Insurance Ltd., the Investigating Officer submits a report to IRDAI, which is minded to cancel the insurer's registration. Ganga has not yet been heard. Which sequence matches section 33 of the Insurance Act, 1938?

IRDAI may cancel registration by written order only after giving the insurer a reasonable opportunity to make a representation on the report. The aggrieved insurer can then appeal to the Securities Appellate Tribunal under section 33 of the Insurance Act, 1938.

  1. AIRDAI may cancel registration at once, since the inspection report was already supplied to the insurer
  2. BIRDAI may cancel registration only after the insurer first appeals to the Securities Appellate Tribunal
  3. CIRDAI must first obtain a court order, then cancel registration
  4. DIRDAI may cancel registration by written order after giving the insurer such reasonable opportunity to make a representation as it considers fit; the insurer may then appeal to the Securities Appellate TribunalCorrect

Explanation

Section 33(6) permits IRDAI, on receiving the report and after giving a reasonable opportunity for representation, to order in writing the cancellation of registration. Section 33(8) lets the aggrieved insurer appeal to the Securities Appellate Tribunal against the order. Appeal comes after the order, not before, and no court order is needed.

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