In the first of its kind action, the Institute of Actuaries of India (IAI) sent out four members of its Managing Council ahead of its annual general meeting (AGM) and in the process, reduced the Council's size less than the statutory requirement, said senior actuaries including a former President of the body.
The IAI is a statutory body created by an Act of Parliament to govern the actuarial profession.
They said on the orders of IAI President Subhendu Kumar Bal through the Executive Director Mohan Bhatia, the four Council Members - Abhay Tewari, K. Subrahmanyam, Pravir Chandra, and Richard Holloway - were informed over a terse email on September 3 that they would retire from September 4.
"By this act the number of elected members of the IAI's Managing Council has come down to eight while the statutory requirement under Section 12 (2) (a) of The Actuaries Act 2006 is nine. As a result, the IAI has become dysfunctional," IAI past President and consulting actuary G.N. Agarwal told IANS.
"If the Council does not meet the requirement of Section 12(2)(a) of The Actuaries Act, it cannot do any function assigned to it under Section 13 - calling of the AGM - and other sections, as it stands dissolved," removed Managing Council member Subrahmanyam, a retired Executive Director (Actuary), Insurance Regulatory and Development Authority of India (IRDAI), told IANS.
"The order of the President to retire the selected four members on September 4 is unconstitutional and illegal, as he caused the dissolution of the Council. Representatives of the nodal ministry for the IAI, that is, the Department of Financial Services are fully aware of this and have not acted so far to remove the constitutional crisis," he added.
"Under such circumstances, the decisions, if any, taken by the President/Officer bearers on after September 4 would become illegal. Council stood dissolved as per law with effect from September 4, in view of 12(2)(a)," Subrahmanyam argued.
Agarwal, on his part, said: "The only way, to my mind, is that either the President take his order of September 3 back and reinstate the Council to function and if the President doesn't do so then the Government of India has to intervene and declare the order of the President null and void."
Curiously, the IAI has called its AGM on September 17 mainly to adopt the result of the 2022 election of the Council and also to condole the passing away of five actuaries.
"I am told the IAI Managing Council meeting was held on September 10 with eight members - the statutory requirement is nine members - and the decision to call for the AGM was taken," Subrahmanyam said.
Subrahmanyam and Agarwal said it is customary for the retiring members to continue till the AGM when the new members take charge.
"This is also the first time when the AGM will not adopt the audited accounts of IAI. Several questions needs to be answered on the accounts," Subrahmanyam said.
According to him, the IAI owes the Insurance Information Bureau (IIB) about Rs 1.2 lakh and details as to the kind of services offered by the latter is not known.
"Similarly, no breakup is available or provided as to the IAI's FY21 outstanding liability of Rs 1.79 crore," Subrahmanyam added.
Contacted for response, IAI President Bal promised to revert but didn't do so.
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