Judgment :- This Writ Petition is for a Writ of Certiorarified Mandamus to call for the records relating to the impugned order of the respondent dated 1.3.2007, to quash the same and to consequently direct the respondent to renew the Hospitalisation and Domiciliary Hospitalisation Benefit Policy (Individual Medi-claim Policy) No.720300/48/05/76191 dated 24.02.2006 from 00.00 hours on 25.02.2007 to midnight of 24.02.2008. 2. The third petitioner herein is the son of petitioners-I and 2. The third petitioner is the proposer in the Hospitalisation and Domiciliary Hospitalisation Benefit Policy (Individual Medi-claim Policy) issued by the respondent herein. The third petitioner had renewed his policy periodically without any break right from 2003 to 2006. The said policy expired on 23.02.2007. The third petitioner sent cheque in the name of the respondent seeking the renewal of the policy by payment loading 40% more than the previous year on account of the claim factor as well as the age of the parents. The said cover containing the cheque for renewal premium was returned back on 23.02.2007. Thereafter, the third petitioner once again presented the same on 24.02.2007 to the respondent through its Divisional Manager by registered post within the permissible grace period. The respondent, however, replied by letter dated 23.02.2007 that the third petitioner had been advised to make alternative arrangements for renewal of Medi-claim Policy. On 01.03.2007, a reply was sent by the respondent enclosing the cheque therein that the third petitioner had made a harsh selection against the respondent by preferring to insure the petitioners-1 and 2 who are the aged parents, with the respondent company and insuring the less age group family members and the staff with another insurer. Under the circumstances, the respondent has ex-pressed its inability to accept the remittance and returned the same to the third petitioner. The third petitioner challenges the letter of the respondent dated 01.03.2007 contending that the respondents action is arbitrary and totally against the scheme of the policy. The third petitioner states that the attitude on the part of the respondent in the matter of refusing to insure the aged parents is arbitrary and is totally discriminatory. 3. Learned counsel appearing for the petitioners submitted that the respondent being a Nationalised Insurance Company under Article 12 of the Constitution of India, ought to have acted in a responsible manner in accepting this renewal. 3. Learned counsel appearing for the petitioners submitted that the respondent being a Nationalised Insurance Company under Article 12 of the Constitution of India, ought to have acted in a responsible manner in accepting this renewal. Learned counsel further submitted that there is total lack of fairness and reasonableness in dealing with this matter of acceptance of renewal and the respondent cannot insist on the continuance of policy as regards the other family members. Learned counsel further submitted that the mere fact that they are having their insurance done with some other company cannot be a ground for the respondent re-fusing to accept the renewal giving 40% additional loading of premium. 4. In support of his contention, learned counsel pointed out that as per Clause 5.9 of the Mediclaim Insurance Policy, the respondent company is bound to accept the renewal for the simple reason that Clause 5.9 states that the respondent company is not bound to give notice when the policy is due for renewal. By this, there is a standing offer by the respondent company. The moment the in- surer remits the premium, there is an automatic acceptance disclosed. In the circumstances, unless there is a specific reason as in the case of the original grant of the policy, the respondent company is bound to grant the renewal. 5. In support of his argument, learned counsel for the petitioners placed reliance on the decision in the case of United India Insurance Company Ltd. and another Vs. Mohanlal Aggarwal reported in AIR 2004 Gujarat 191. In particular, he placed emphasis on paragraph 34.4 as well as the scheme of the policy laying stress on the status of the Insurance Company. Learned counsel pointed out that there is total arbitrariness in its refusal of the renewal plea made by the petitioner herein. 6. Learned counsel appearing for the Insurance Company submitted that a renewal, even going by Clause 5.9, is only on mutual acceptance of the terms and that Clause 5.9, by itself, cannot be a ground for the respondent. Apart from that, learned counsel for the respondent pointed out that the third petitioner has to state the reasons in choosing to retain petitioners-1 and 2, who are aged mem-bers with the respondent Insurance Company and insuring the less age group of other family members and staff with an-other insurer. Apart from that, learned counsel for the respondent pointed out that the third petitioner has to state the reasons in choosing to retain petitioners-1 and 2, who are aged mem-bers with the respondent Insurance Company and insuring the less age group of other family members and staff with an-other insurer. Under the circumstances, considering the nature of business carried on, the conditions of policy necessarily have to be read in for the purpose of finding out whether the renewal could be treated as an automatic one or rest on mutual consent by both the parties. In this connection, learned counsel pointed out that the decision of the Gujarat High Court has no bearing on the present case in view of Clause 11 of the prospectus. Considering the fact that the refusal is subject to the renewal of the policy and so long as there is no arbitrary exercise, given the reasons for rejection, the order passed by the respondent may not be faulted with. Learned counsel further submitted that the third petitioner has chosen to shift his policy with somebody else except his parents, it stands to reason that he should have taken these persons too along with the other policies also. There was no reason at all for going out from the respondent company, especially when the aged parents alone have been retained with the respondent company. He submitted that the conditions for renewal cannot be different in its terms from the one for original policies in terms of Clause 11 of the prospectus. Under the circumstances, the decision of the Gujarat High Court cannot be fairly placed for reliance. Quite apart from this, learned counsel pointed out that Clause 11 extracted in the judgment of the Gujarat High Court is not correctly extracted as given in the prospectus available. Considering the same, the learned counsel pleaded that the acceptance of the order impugned is correct and justified in the circumstances of the case. 7. At the outset, it may be noted that even as per Clause 5.9 of the Mediclaim Insurance Policy, the respondent has retained the standing offer for renewal only subject to the insurer paying the renewal fee. A perusal of Clause 5.9 shows that the insured may, at any time, cancel this policy, and in such event, the company shall allow refund of premium at the companys short period. A perusal of Clause 5.9 shows that the insured may, at any time, cancel this policy, and in such event, the company shall allow refund of premium at the companys short period. The relevant portion of 5.9 reads as follows:- "5.9. The policy may be renewed by mutual consent. The company shall not how-ever be bound to give notice that it is due for renewal and the company may at any time cancel this policy by sending the insured 30 days notice by registered letter at the insureds last known address and in such event the company shall refund to the insured a pro-rate premium for unexpired period of insurance. The company shall however, remain liable for any claim which arose prior to the date of cancellation. The insured may at any time cancel this policy and in such event the company shall allow refund of premium at companys short period rate only (table given here below) provided no claim has oc-curred upto the date of cancellation. Period on risk Rate of premium to be charged upto one month 1/4 of the annual rate upto three months 1/2 of the annual rate upto six months 3/4 of the annual rate Exceeding six months Full annual rate 8. As regards the renewal of policy, Clause 11 of the prospectus reads as follows :- "This insurance policy is issued for a period of one year and subject to review, continuation of insurance cover will be available if the renewal premium is paid in time. On continuation of insurance cover and timely remittance of premium insured becomes eligible for the following benefits from first day after renewal. a) Cumulative bonus if accrued (Ref item 9) b) Cost of health check-up if due (Ref item 10) c) Payment of hospitalisation cost for diseases/illness/injury sustained even during first 30 days of renewal (Refer Exclusion 4.2 and 4.3) Renewal of insurance cover: A further period of 7 days from the date of expiry will be permissible in exceptional cases subject to health Certificate from Medical Practitioner. (N.B: Any diseases contracted during the period of 7 days extension will be excluded from the date of renewal in addition to other diseases excluded in the expiring policy, whereas other benefits mentioned above in item 11 (a) (b) (c) will be permissible." The cumulative effect of these conditions is that the conditions which prevail for rejection of a policy is the same as the one for renewal. If the policy sought for the first time is acceptable, in absence of any other extraneous circumstances (it stands to reason that with a clause for renewal) the insurance company cannot re-fuse the same on any other ground. 9. Touching on the clause 11 and clause 5.9 in the policy, the Gujarat High Court, in the case of United India Insurance Company Ltd. and another Vs. Mohanlal Aggarwal reported in AIR 2004 Gujarat 191, in paragraph 34.4, held as follows:- "34.4. In the contract of insurance, the term "renewal" is used to denote both extension of the original period of cover by the exercise of a right given to the insured by the contract to extend the period of cover without the assent of the other, and the making of a new contract through the agreement of both. It is important to distinguish the two types of renewal, since only in the former case, will vitiating elements in the original contract, such as, failure to make full disclosure affect the extension, and conversely only in the later case will a duty arise to make full disclosure, at the time of renewal. Where the insurance (e.g. life insurance) gives the assured the right to renew automatically on the payment of a further premium at the end of the first period, such renewal does not constitute a new contract" 10. Touching on Clause 5(1) of the prospectus, in paragraph 24 of its judgment, the Gujarat High Court held that when there is a standing offer from the Insurance Company, the moment the renewal fee is paid, there is an automatic acceptance from the insurer to offer the service and the continuance of the policy will be available to the insured. Learned counsel, however, submitted that given the competition in this field and the concept governing the issuance of the policy, the offer read in the policy cannot be taken as an offer without any reservation. 11. Learned counsel, however, submitted that given the competition in this field and the concept governing the issuance of the policy, the offer read in the policy cannot be taken as an offer without any reservation. 11. I do not find any justification in the submissions made by the learned counsel for the respondent. As to the claim that Clause 11 has not been properly extracted, except for the comma there is no serious difference in the extracted portion in Clause 11 of the Judgment of the Gujarat High Court. In any event, that does not call for any different view in this matter. 12. It may be noted that given the status of a nationalised Insurance Company, it goes without saying that it should act with fairness, keeping in mind the very object of this policy and the welfare of the insurer. In the above circumstances, the contention put forth by the respondent to reject the renewal on the ground that retaining the aged parents of the third petitioner with the respondent company would be detrimental to the interest of the respondent herein, does not carry any merit for acceptance. 13. The order dated 01.03.2007 is nothing but an arbitrary exercise of its discretion and hence, deserves to be quashed. Except for the reasons as stated above, there are no negative facts for the Insurance company to reject the request of the petitioner. 14. The attitude of the respondent company in rejecting the plea only on the sole ground that the third petitioner had shifted some of his policies with some-body else would certainly amount to arbitrary exercise of its statutory applications rested with the respondent. When the conditions available for rejection are not there, the letter dated 01.03.2007 merits to be set aside by this Court. In the circumstances, I have no hesitation in setting aside the order dated 01.03.2007. Consequently, the Writ Petition is allowed with a direction to the respondent herein to issue the renewal of the policy, considering the fact that the renewal fee had been remitted well in time in accordance with the policy terms. With the above direction, the Writ Petition is allowed. There will, however, be no order as to costs. Consequently, connected M.Ps are closed.