JUDGMENT : Jayant Patel, J. The present appeal arises against the order dated 21.9.2001 passed by the learned Single Judge of this Court in Special Civil Application No.541 of 2001, whereby the decision of the respondent Corporation of termination of the agency and forfeiture of all the commissions has not been interfered with. 2. The relevant facts are that the petitioner was appointed as the agent on 8.2.1993 of Life Insurance Corporation of India. There is no dispute by the other side that the petitioner continued to satisfactorily worked as the agent until the incident in question, which arose in the year 1997. To say other words, the petitioner worked satisfactorily as the agent of the LIC of India for about 14 years. As per the petitioner, during the period of last 12 years of agency, the petitioner had procured business of more than Rs. 5 crore in as many as 683 policies with the total premium of Rs. 19.63 lac. However, it appears that for the policies, which were taken in the year 1995, in respect of about 15 policies, it was found that there were suppression of material facts and as per LIC of India, a fraud was placed by the original petitioner - appellant in connivance with the staff of the LIC of India. When it was disclosed, a show-cause notice was issued on 11.11.1997. Thereafter, the petitioner replied to the show-cause notice and ultimately vide order dated 19.12.1997, the final order came to be passed by the Senior Divisional Manager (Disciplinary Authority), whereby in exercise of power under Regulation 16(1)(a),(b) and (d) of (Agents) Regulations, 1972, the agency is terminated and all commission payable to the original petitioner - appellant as per Regulation No.19(1) of (Agents) Regulations, 1972 was ordered to be forfeited. The petitioner - appellant carried the matter in appeal, which failed. The petitioner - appellant further carried the matter by way of a memorial to the Chairman, which also failed. Thereafter, the petitioner preferred petition before this Court and the learned Single Judge, for the reasons recorded in the order, dismissed the petition. It is under these circumstances, the present appeal before us. 3. We have heard Mr. Parikh, learned Counsel appearing for the appellant - original petitioner and Mr. Clerk, learned Counsel appearing for the respondent Corporation. 4. Thereafter, the petitioner preferred petition before this Court and the learned Single Judge, for the reasons recorded in the order, dismissed the petition. It is under these circumstances, the present appeal before us. 3. We have heard Mr. Parikh, learned Counsel appearing for the appellant - original petitioner and Mr. Clerk, learned Counsel appearing for the respondent Corporation. 4. As such, it appears from the record and more particularly, the reply filed by the petitioner to the show-cause notice and recital stated in the order that the involvement of the petitioner for the alleged fraud was established and, therefore, if on that basis the Corporation had taken decision that it was a case of fraud, wherein the petitioner and one of the employees of the Corporation, Purani had conspired for the said 15 policies resulting into the fraud, the decision for termination of the agency, in our view, does not call for interference when upon the examination of the facts, three authorities have concurrently found that the fraud was established. Therefore, we are not inclined to accept the submissions of the learned Counsel for the appellant - original petitioner for assailing the decision of the LIC of India for termination of the agency on the ground of fraud. 5. However, the contention of the learned Counsel for the appellant - original petitioner that even if the it was a case of fraud, LIC of India could forfeit the commission qua the 15 policies only and it could not forfeit the commission of the policies, for which there was no dispute or there was no complaint and the work of such policies was satisfactorily, deserves consideration. 6. It was submitted by the learned Counsel Mr. Clerk for the respondent that the Regulation 19 provides that in a case where the fraud is found, all commissions in respect of all policies irrespective of the fact that whether the fraud pertains to the said policy or not can be forfeited. 7. Whereas, the contention of the learned Counsel for the original petitioner - appellant is that it would apply to the policy in question and such power cannot be read. 7. Whereas, the contention of the learned Counsel for the original petitioner - appellant is that it would apply to the policy in question and such power cannot be read. It was alternatively submitted that even if such powers are read under Regulation 19, it would be too harsh and, therefore, it would be required for the authority to exercise the power in proportionate to the gravity of the fraud and thereafter only the decision could be taken for forfeiture of all commissions or for forfeiture of the commission pertaining to the policy, for which the alleged fraud was found. 8. In order to consider the submission, we may refer to certain provisions of the Regulations. The (Agents) Regulations, 1972 (hereinafter referred to as the 'Regulations') are the Regulations, which govern the terms and conditions of an agent with LIC of India. Regulation 2 of the Regulations provides for application of the Regulations to all the agents appointed by the Corporation in respect of life insurance business. Regulation 3 (1)(b) provides that `agent' means a person who has been appointed under regulation 4 of these Regulations and includes an absorbed agent. `Agency' has been defined by regulation 3(1)(c), which provides for the different span of agency and as specifically provided therein, the first year of the appointment, the period shall from beginning of the month till end of the month, in which, he completes 12 months as an agent. Regulation 4 provides that the agent should be appointed in any place for the purpose of soliciting or procuring life insurance business for the Corporation. It also provides for the qualification of the agents as per Regulation 5. Regulation 8 provides for functions of agents, which, inter alia, includes that every agent shall solicit and procure new life insurance business which shall not be less than the minimum prescribed in these Regulations and shall endeavour to conserve the business already secured. The other relevant provision of Regulation 8 is that in procuring life insurance business, an agent shall make all the reasonable inquiries in regard to the lives be insured before recommending proposals for acceptance, and bring to the notice of the Corporation any circumstances which may adversely affect the risk to be underwritten. Regulation 9 provides for minimum amount of business to be secured by agents. Regulation 10 provides for payment of commission to agents. Regulation 9 provides for minimum amount of business to be secured by agents. Regulation 10 provides for payment of commission to agents. For ready reference, regulation 10 can be read as under:- Regulation 10 : Payment of commission to agents: (1) As compensation and remuneration for the discharge of all his functions under these regulations, an agent shall be paid commission at the rates set out in Schedule II on the first year premiums and renewal premiums received during the continuance of his agency in respect of the completed business under his agency. (2) An agent shall, in addition to the commission payable under sub-regulation (1), be entitled to bonus commission on first year premiums as provided in Schedule III. (3) (a) Notwithstanding anything contained in sub-regulation (1) and sub-regulation (2), an agent who has been confirmed may, at any time during the continuance of his agency, opt to receive commission as provided in Schedule IV. (b) Where an option under clause (a) is exercised, the commission and bonus commission payable to the agent shall be at the rates set out in Schedule IV and Schedule V respectively in respect of the business which may be completed in his agency from the commencement of the agency year following the date on which he exercises the option, but in respect of the business completed in his agency upto the end of the agency year in which he exercises the option, the commission or bonus commission payable to him shall be as provided in Schedule II and Schedule III respectively. (c) The option once exercised under clause (a) shall be final and irrevocable. (c) The option once exercised under clause (a) shall be final and irrevocable. (4) Save as hereinafter provided, no agent shall be paid any commission or remuneration in respect of any policy not effected through him: Provided that where a policy of life insurance has lapsed and it cannot under the terms and conditions applicable to it be revived without further medical examination of the person whose life was insured thereby and where notice has been given in writing to the agent through whom the policy was effected (if such agent continues to be an agent of the Corporation), to effect the revival of the policy within a specified period of not less than one month from the date of receipt by him of the notice and the policy is not so revived, the Corporation may pay to another agent who effects the revival of the policy an amount calculated at a rate not exceeding half of the rate of commission at which the agent through whom the policy was effected would have been paid had the policy not lapsed, on the sum payable on revival of the policy on account of arrear premiums (excluding any interest on such arrear premiums) and also on the subsequent renewal premiums payable on the policy. (5) Notwithstanding anything contained in sub-regulation(1), sub-regulation (2) and sub-regulation (3), an agent who is on probation shall be entitled to the commission payable on the first year premium received in respect of the business completed during the continuance of his agency and not to the bonus commission or commission on renewal premiums in respect of such business: Provided that the agent shall, on his confirmation, be entitled to the bonus commission or commission on renewal premiums in respect of such business. (6) Save as provided by regulation 19, no commission shall be payable to an agent after he has ceased to be such agent. The aforesaid regulation shows that as a compensation and remuneration, for discharge of all the functions under its regulation, the agent shall be paid commission at the rate set out in the schedule II on the first year premiums and renewal premiums received during the continuance of his agency in respect of the completed business under his agency. Sub-regulation( 2) of regulation 10 provides for additional payment of the bonus. Sub-regulation( 2) of regulation 10 provides for additional payment of the bonus. Regulation 10(4) provides that no agent shall be paid any commission or remuneration in respect of any policy not effected through him. The pertinent aspect is that the entitlement of the commission or remuneration by the agent would be relatable to the policy, which is effected through him and he has no right to receive any commission or remuneration to the policy not effected through him. Regulation 10(6) provides that save as provided by regulation 19, no commission shall be payable to an agent after he has ceased to be such agent. The pertinent aspect is that regulation 19 is saved for the purpose of entitlement of the commission. 9. Regulation 16, which was pressed in service by the respondent Corporation, reads as under: "Regulation 16: Termination of agency for certain lapses: (1)The competent authority may, by order, determine the appointment of an agent. (a) if he has failed to discharge his functions, as set out in regulation 8, to the satisfaction of the competent authority; (b) if he acts in a manner prejudicial to the interests of the Corporation or to the interests of its policyholders; (c) if evidence comes to its knowledge to show that he has been allowing or offering to allow rebate of the whole or any part of the commission payable to him; (d) if it is found that any averment contained in his agency application or in any report furnished by him as an agent in respect of any proposal is not true; (e) if he becomes physically or mentally incapacitated for carrying out his functions as an agent; (f) if he being an absorbed agent, on being called upon to do so, fails to undergo the specified training or to pass the specified tests, within three years from the date on which he is so called upon; Provided that the agent shall be given a reasonable opportunity to show cause against such termination. (2) Every order of termination made under sub-regulation (1) shall be in writing and communicated to the agent concerned. (3) Where the competent authority proposes to take action under Sub-regulation (1) it may direct the agent not to solicit or procure new life insurance business until he is permitted by the competent authority to do so. (2) Every order of termination made under sub-regulation (1) shall be in writing and communicated to the agent concerned. (3) Where the competent authority proposes to take action under Sub-regulation (1) it may direct the agent not to solicit or procure new life insurance business until he is permitted by the competent authority to do so. The aforesaid regulation speaks for the termination of the agency for certain lapses and it also speaks for giving an opportunity to the person concerned to show cause before termination. 10. Regulation 19, which is of the prime consideration, reads as under: "Regulation 19 Payment of commission on discontinuance of agency: (1) In the event of termination of the appointment of an agent, except for fraud, the commission on the premiums received in respect of the business secured by him shall be paid to him if such agent : (a) has continually worked for at least 5 years since his appointment and policies assuring a total sum of not less than Rs. 2 lakhs effected through him were in full force on a date one year before his ceasing to act as such agent; or (b) has continually worked as an agent for at least 10 years since his appointment; or (c) Being an agent whose appointment has been terminated under clause (e) of sub-regulation (1) of regulation 16 has continually worked as an agent for at least two years from the date of his appointment and policies assuring a total sum of not less than Rs. 1 lakh effected through him were in full force on the date immediately prior to such termination; Provided that in respect of an absorbed agent the provisions of clause (a) shall apply as if for the letters, figures and word "Rs.2 lakhs", the letters and figures "Rs.50,000" had been substituted. (2) Any commission payable to an agent under sub-regulation (1) shall, notwithstanding his death, be payable to his nominee or nominees or, if no nomination is made or is subsisting, to his heirs, so long as such commission would have been payable had the agent been alive. (2) Any commission payable to an agent under sub-regulation (1) shall, notwithstanding his death, be payable to his nominee or nominees or, if no nomination is made or is subsisting, to his heirs, so long as such commission would have been payable had the agent been alive. (3) In the event of the death of the agent while his agency subsists, any commission payable to him had he been alive shall be paid to his nominee, or, if no nomination is made or is subsisting, to his heirs, so long such commission would have been payable had the agent been alive, provided he had continually worked as an agent for not less than 2 years from the date of his appointment and policies assuring a total sum of not less than Rs. 1 lakh effected through him were in full force on the date immediately prior to his death. (4) If the renewal commission payable under sub-regulation (1) or sub-regulation (2) or sub-regulation (3) falls below Rs. 100/- in any financial year (hereinafter referred to as the said financial year), the competent authority may, notwithstanding anything contained in the said sub-regulation, commute all commission payable in subsequent financial year for a lump sum which shall be three times the amount of renewal commission paid in the said financial year, and on the payment of such lump sum to the agent or his nominees or heirs, as the case may be, no commission on the business effected through the agent shall be payable in the financial year subsequent to the said financial year." On reading sub-regulation (1) of regulation 19, it appears that in the event of termination of the appointment of an agent, except for fraud, the commission on the premiums received in respect of the business secured by him shall be paid to him if he has continually worked for at least 5 years since his appointment and policies assuring a total sum of not less than Rs. 2 lakhs effected through him or he has worked as an agent for at least 10 years since his appointment. In the present case, it is an admitted position that original petitioner has worked as an agent for a period exceeding 10 years. 2 lakhs effected through him or he has worked as an agent for at least 10 years since his appointment. In the present case, it is an admitted position that original petitioner has worked as an agent for a period exceeding 10 years. Sub-regulation (2) of regulation 19 provides that the commission payable to an agent under sub-regulation (1) shall be paid notwithstanding the death of the agent concerned to his nominee or nominees or legal heirs. The aforesaid Regulation shows that commission payable is subject to the compliance of entitlement of the commission, if he has worked for a period of 10 years as an agent or more, as per regulation 19(1)(c) the commission shall be payable even after the termination of agency, if one satisfies other conditions. Therefore, the agent is entitled to receive the commission after termination. Even after the death of the person concerned, the commission is payable to the legal heirs or the nominees of the agent. The aforesaid shows that there is substantive right to receive the commission by the person concerned. The controlling circumstance are narrated by way of clause (a) or (b) or (c) of Regulation 19(a). It is true that Regulation 19 speaks for the word `except for fraud'. Therefore, in case of a fraud, one might contend that the entitlement of the commission would not flow, but on over all reading of regulation 19 read with scheme of the regulation, it does appear that it is a substantive right of an agent to receive the commission if he satisfies the minimum requirement. If case of fraud is to be considered as an exception to the entitlement of the commission, it can be read in two ways; one reading would be that in case of a fraud, one would not be entitled for commission in respect of the policy for which the fraud is found; the another way would be to read that in case of a fraud, the agent would not be at all entitled for payment of commission, even in respect of the policies for which, there is no alleged fraud. Taking the exercise of the power on latter part of the interpretation, even if considered, the resultant effect would be that in case of fraud, the Corporation has a right to forfeit the commission of the agent in respect of the policies for which there is no alleged fraud, then also, it is by now well settled that when there is a power vested with the authority for forfeiture of commission, the principle of proportionality of the punishment will have a role to play. Merely because alleged fraud is found or established, it cannot be said that substantive right to receive commission would automatically cease in all cases. It would depend upon the gravity of the fraud and would also depend upon the aspect to be considered by the authority for quantum of resultant forfeiture or the entitlement of the commission in respect of the policy for which there is no allegation of fraud whatsoever. 11. The aspect for application of the principle of proportionality of punishment is by now well settled. We may profitably refer to the decision of the Apex Court in case of N. Nagendra Rao and Co. v. State of Andhra Pradesh, reported in AIR 1994 SC p-2663. The said case was under the Essential Commodities Act, wherein the Collector has power to forfeit the goods and articles seized. It was observed by the Apex Court at para-5, the relevant of which reads as under : "..... The exercise of power was obviously mechanical. This is being mentioned only to demonstrate the nature of power and how it is expected to be exercised. Nothing turns on it so far this appeal is concerned. But what needs to be mentioned is that since the power is very wide as a person violating the Control Orders is to be visited with serious consequences leading not only to the confiscation of the seized goods, packages or vessel or vehicle in which such essential commodity is found or is conveyed or carried, but is liable to be prosecuted and penalized under Section 7 of the Act, it is inherent in it that those who are entrusted with responsibility to implement it should act with reasonableness, fairness and to promote the purpose and objective of the Act. Further, it should not be lost sight of that the goods seized are liable to be confiscated only if the Collector is satisfied about violation of the Control Orders. The language of the section and its setting indicate that every contravention cannot entail confiscation. That is why the section uses the word 'may'. A trader indulging in black marketing or selling adulterated goods etc should not, in absence of any violation, be treated at par with technical violation, such as failure to put up the price list etc. or even discrepancies in stock." The aforesaid decision has been followed by this Court in number of cases, and one of which can be referred as in case of M/s. Navjivan Roller Flour & Pulse Mills Ltd. v. State of Gujarat, reported in 2001 (2) GLR p.1467, wherein, this Court based on the principles of proportionality of punishment has reduced the confiscation of the goods for alleged technical contravention. 12. We may also record that even if it is to be read that the principle of proportionality of punishment are to be taken into consideration by the authority for forfeiture of commission of an agent, then also, one might contend that when disciplinary authority is clothed with power to impose penalty, normally this Court in a judicial review under Article 226 of the Constitution, would not interfere unless the punishment is shockingly disproportionate to the gravity of the alleged irregularity or the fraud in the present case. We may record that it is not a case of the respondent Corporation that petitioner has been involved into fraud in so many policies since so many years. It is true that the incident in question is of the year 1995 for 15 proposals of the policies in question which were during the period from May 30, 1995 to 17.6.1995. Therefore, in respect of those 15 policies for which proposals were given the alleged fraud is found to be played. It is true that the incident in question is of the year 1995 for 15 proposals of the policies in question which were during the period from May 30, 1995 to 17.6.1995. Therefore, in respect of those 15 policies for which proposals were given the alleged fraud is found to be played. As observed earlier, if the strict and narrow interpretation is given, one might say that the power of forfeiture of the commission would be available or the right to receive commission would cease, in respect of the policies for which, the fraud was played and upon the wider interpretation, one might say that it may extend to the cessation of the right to receive commission even in respect of the policy in which, there was no fraud. The said aspect is required to be examined in light of sub-clause (a), (b) and (c) of regulation 19 for entitlement of the commission by the person concerned in a case where there is no fraud. Even if a person has worked for a period of one year also and has given the business of not less than Rs. 2 lakhs, he would be entitled to commission from the premium of such policies of that period and such right would flow not only upon him but to his legal heirs. In the present case, original petitioner has worked as an agent satisfactorily for a period of about 14 years and as stated by him, he has provided business of about more than 5 crore of 583 policies of life insurance and the premium of such policies is Rs. 19.63 lakhs every year. It is not a matter where, in respect of those policies, any complaint has been received nor it is a case that Life Insurance Corporation has not received premium of such policies procured by the petitioner in capacity as an agent for those period of 14 years. On the contrary, irrespective of the termination and the alleged fraud for 15 policies of the year 1995, those policies for which the business was undertaken by the petitioner for a period of about 14 years satisfactorily, LIC has continued to get benefit of the premium based on the same. On the contrary, irrespective of the termination and the alleged fraud for 15 policies of the year 1995, those policies for which the business was undertaken by the petitioner for a period of about 14 years satisfactorily, LIC has continued to get benefit of the premium based on the same. It deserves to be noted that it is not a matter of relationship of a person as that of employer or employee governed by service jurisprudence or governed by the code of conduct specifically imposed for such purpose and entailing the dismissal from service with further punitive powers for forfeiture but is a matter where the business is being procured by the life insurance under the contract of agency of course governed by the provisions of regulation. Had it been the case of contract of agency, independently without there being any regulation, even if the principal has to recover any damage, appropriate proceedings would be required to be undertaken. Further the contract of agency, if considered, for each policy separately, the same would be an independent contract. If an agent has failed in one of the contract of agency, may be for one reason or other or even if it is an alleged fraud in respect of one contract of agency, performed by the agency, it cannot be connected with the another contract in respect of altogether a different transaction performed by the agent, so as to read the power of the principal to forfeit commission earned by the agent in respect of altogether a different contract. 13. If the resultant effect of cessation of the right for commission or forfeiture of the commission is imposed by the authority of LIC, is considered, in light of the aforesaid, it can be said that the punishment so imposed has resulted into loss of the commission which is shockingly disproportionate to the alleged fraud. Ultimately, it will be for the competent authority of the Corporation to decide the aspect of proportionality of the punishment and to arrive at a decision as to entitlement of the commission by the petitioner, if to be curtailed or forfeited to what extent, keeping in view the facts and circumstances of the case. 14. Ultimately, it will be for the competent authority of the Corporation to decide the aspect of proportionality of the punishment and to arrive at a decision as to entitlement of the commission by the petitioner, if to be curtailed or forfeited to what extent, keeping in view the facts and circumstances of the case. 14. The examination of the impugned decision passed by the competent authority of LIC and further orders in Appeal, show that there is absolutely no application of mind by any of the authority on the said aspect of the proportionality of the punishment nor the authorities have taken into consideration the aspects as observed herein above and which are germane to the exercise of power, even if it is read that they have power to forfeit the right for entitlement of the commission of an agent. Therefore, the matter deserves to be remanded back to the authority i.e. first authority for reconsideration of the matter on the said aspect. 15. Mr. Clerk, learned counsel appearing for the respondent Corporation relied upon the decision of this Court in case of Life Insurance Corporation of India v. Insu., Agent Code No. 14739835 decided on 26.6.2003 and contended that in a case of fraud, the contract would be vitiated and no right would remain for entitlement of the commission even in respect of the policy for which there is no complaint. Whereas, Mr. Parikh, learned counsel appearing for the appellant, relied upon another decision in case of Sr. Divisional Manager, IIC of India v. Ajitsinh Amirsinh Raj Insurance Agency, of the very Division Bench of this Court in Letters Patent Appeal No. 1686 of 2006 decided on 26.6.2009, wherein, the Court has made observation on the aspect of harsh and disproportionate punishment to the gravity of the alleged irregularity, which was a case of other than fraud and it was submitted that therefore, this aspect may be considered. 16. We find that in neither of the case, the aspect of interpretation of regulation 19 read with aspect of proportion of the punishment had come for consideration before this Court in the aforesaid decision. Therefore, said decisions are of no help to the learned counsel. 17. 16. We find that in neither of the case, the aspect of interpretation of regulation 19 read with aspect of proportion of the punishment had come for consideration before this Court in the aforesaid decision. Therefore, said decisions are of no help to the learned counsel. 17. In view of the aforesaid observations and discussions, the impugned order passed by the authority for termination of the agency and forfeiture of the commission in respect of the policy for which the alleged fraud was found, is not interfered with. However, the decision for forfeiture of the commission in respect of the policy for which there is no fraud found, or there was no allegation of fraud, deserves to be quashed and set aside. It is further observed and directed that the concerned authority of the respondent Corporation shall reconsider the matter afresh on the aspect of proportionality of the punishment keeping in view the observations made hereinabove and after giving an opportunity to the petitioner and shall pass appropriate orders as early as possible, preferably within a period of three months from the receipt of this order. Consequently, the appeal is partly allowed to the aforesaid extent. No order as to costs. S.R. Brahmbhatt - (Concurring) The above said conclusion should also be supported on the following supplementary reasons which I may enlist herein below: The Agent of Life Insurance Corporation of India ("LIC" for short) is not to be equated with the employee of LIC. The LIC Agents are governed by separate set of Rules called the "Life Insurance Corporation Of India (Agents) Regulations, 1972". These Regulations have been framed in exercise of power conferred under Section 49 of the Life Insurance corporation Act, 1956. Regulation 10 of the Regulations governs payment of commission to agents. Section 10 (6) provides that Save as provided by regulation 19, no commission shall be payable to an agent after he has ceased to be such agent. Regulation 19 provides Payment of commission on discontinuance of agency. It is very important to note at this stage that no appeal is provided from the order passed under Regulation 19. Section 10 (6) provides that Save as provided by regulation 19, no commission shall be payable to an agent after he has ceased to be such agent. Regulation 19 provides Payment of commission on discontinuance of agency. It is very important to note at this stage that no appeal is provided from the order passed under Regulation 19. The Regulation 19(1) read as under:- "19 (1) - In the event of termination of the appointment of an agent, except for fraud, the commission on the premiums received in respect of the business secured by him shall be paid to him if such agent: (a) has continually worked for at least 5 years since his appointment and policies assuring a total sum of not less than Rs. 2 lakhs effected through him were in full force on a date one year before his ceasing to act as such agent;or (b) has continually worked as an agent for at least 10 years since his appointment; or (c) being an agent whose appointment has been terminated under clause (e) of sub-regulation (1) of regulation 16 has continually worked as an agent for at least two years from the date of his appointment and policies assuring a total sum of not less than Rs. 1 lakh effected through him were in full force on the date immediately prior to such termination: Provided that in respect of an absorbed agent the provisions of clause (a) shall apply as if for the letters, figures and word "Rs.2 lakhs", the letters and figures "Rs.50,000" had been substituted." 2. Thus in the event of termination of the appointment of an agent, "except for fraud" (emphasis supplied), the commission on the premium received in respect of the business secured by the agent shall be paid to said agent as prescribed under Regulation 19. Thus Regulation 19 prescribes that 'except in case of fraud', how after discontinuance of agency the agent is required to pay the commission on the premium received in respect of the business secured by him in past. The LIC is a State as held by the Apex Court and, therefore, it is expected of adhering to the standards of fair play and principle of natural justice. The agent is when not treated to be an employee but is required to be treated as a contracting party. The LIC is a State as held by the Apex Court and, therefore, it is expected of adhering to the standards of fair play and principle of natural justice. The agent is when not treated to be an employee but is required to be treated as a contracting party. Meaning thereby, the contract of agency is between the LIC and its agent which would govern the relationship of parties. In addition to the terms of contract which naturally have to be in accordance with law, the relationship is also governed by the agents on regulation framed under Section 49 of the LIC Act. Some of the Regulations therefore are required to be set out in order to appreciate the fine distinction drawn between the employee of LIC and the Agent of LIC, and how they are being treated. Regulation 15 is important to be set out as under: "15. Termination of agency on account of certain disqualifications: If an agent: (a) is found to be of unsound mind by a court of competent jurisdiction; (b) is found to be guilty of criminal misappropriation or criminal breach of trust or cheating or forgery or an abetment of or attempt to commit any such offence by a court of competent jurisdiction; (c) in any judicial proceedings, has been found to have knowingly participated in or connived at any fraud, dishonesty or misrepresentation against the Corporation or any of its subsidiaries or against any person having official dealings with the Corporation or any of its subsidiaries, his appointment shall be liable to be terminated without notice and the competent authority shall forthwith terminate his appointment." Regulation 16 is also required to be set out as under. "16. "16. Termination of agency for certain lapses: (1) The competent authority may, by order, determine the appointment of an agent, (a) if he has failed to discharge his functions, as set out in regulation 8, to the satisfaction of the competent authority; (b) if he acts in a manner prejudicial to the interests of the Corporation or to the interests of its policyholders; (c) if evidence comes to its knowledge to show that he has been allowing or offering to allow rebate of the whole or any part of the commission payable to him; (d) if it is found that any averment contained in his agency application or in any report furnished by him as an agent in respect of any proposal is not true; (e) if he becomes physically or mentally incapacitated for carrying out his functions as an agent; (f) if he being an absorbed agent, on being called upon to do so, fails to undergo the specified training or to pass the specified tests, within three years from the date on which he is so called upon: (2) Every order of termination made under sub-regulation (1) shall be in writing and communicated to the agent concerned. (3) Where the competent authority proposes to take action under Sub-regulation (1) it may direct the agent not to solicit or procure new life insurance business until he is permitted by the competent authority to do so." A bare perusal of Regulation-15 shows that the termination of agency is to be brought about in case of certain disqualifications and those disqualifications are enumerated in sub clause (a), (b) and (c) of Regulation 15. Sub clause (c) of Regulation-15 clearly points out that "in any judicial proceeding, the agent has been found to have knowingly participated in or connived at any fraud, dishonesty or misrepresentation against the Corporation or any of its subsidiaries or against any person having official dealings with the corporation or any of its subsidiaries" then, in such a situation his appointment is made liable to be terminated as an agent without notice. As against this, and reading in juxtaposition with this position of Regulation 15 with provision of Regulation 16 it would be seen that Regulation 16 emphasize the competent authority of LIC to bring about termination of agency for certain lapses. The lapses enumerated under Regulation 16 nowhere refers in explicit term "fraud". As against this, and reading in juxtaposition with this position of Regulation 15 with provision of Regulation 16 it would be seen that Regulation 16 emphasize the competent authority of LIC to bring about termination of agency for certain lapses. The lapses enumerated under Regulation 16 nowhere refers in explicit term "fraud". Though it does refer to some lapses on the part of the agent which might be equated with incorrect statement made by an agent or false information given by the agent. It is required to be noted at this stage that for bringing about termination of agency on account of lapses enumerated in Regulation 16 on the part of the agent, then a reasonable opportunity is required to be given to the agent, much less to holding appropriate inquiry in an appropriate manner. It is required to be noted at this stage that, appeal is provided from order made under Regulations 15, 16, 17 and 18, but no appeal is provided for any order or against any order passed under Regulation 19. Meaning thereby Regulation 19 cannot be construed to clothe the LIC with any substantive power. It is more of a mechanical objection resulting in exercise of the determination of agency brought about either under Regulation 15 or under 16. Regulation 15 in terms refer to 'fraud' on the part of the agent. I reiterate at the cost of repetition that Regulation 15 refers to disqualifications on the part of the agent and on agent's suffering from any one of those disqualifications; namely from Regulation 15 (a), (b) and (c). The termination of agency cannot be qualified to be termination on account of invocation of Regulation 15. 3. In the instant case, as could be seen from the impugned show cause notice which came to be issued on 19/12/1997 as well as the order of terminating agency dated 24/9/1999, it can well be said that the authority has proceeded under Regulation 16 only. Regulation-15 which is disqualifications have neither been invoked nor been attributed or alleged against the petitioner herein above. Thus when the authorities have made out a case only based upon the lapses enumerated under Regulation 16, then, question arises as to whether 19(1) could be invoked, where under the commission is forfeited on account of fraud or disqualification involving fraud is attracted by the agent. Thus when the authorities have made out a case only based upon the lapses enumerated under Regulation 16, then, question arises as to whether 19(1) could be invoked, where under the commission is forfeited on account of fraud or disqualification involving fraud is attracted by the agent. In other words in case if any action is taken under Regulation 15 against the agent then Regulation 19 (1) cannot be invoked when only action against agent is invoked on account of lapses enumerated under Regulation 16, i.e. from Regulation 16 (1) (a) to (f), (2) and (3). The Legislature and Rule Framing Authority could not have clothed the one contracting party to forfeit the commission for the work already done by the agent and procuring clients and on their payment of premium, as one contracting party could not have legitimately decided about other party's fraud taking up on its own task of terming him to be fraudulent so as to deprive the agent of all the benefits of his past work. In fact, therefore, as could be seen from the language employed in Regulation 15, it is a disqualification which the agent incurs on account of he being found to be unsound mind by a court of competent jurisdiction being adequate guilty of criminal misappropriation by court of competent jurisdiction or being found fraudulent in any judicial proceedings. Therefore, in my view, for visiting the agent with dire consequences of forfeiture of his entitlement to receive commission on the past contracts or policies which he procured the requirement of Regulation 15 are to be fully satisfied. In the instant case, as could be seen from the record, the authorities have not invoked Regulation 15 at all against the present petitioner, and therefore, in my view there is no question of visiting him with forfeiture in his entitlement of receiving commission in future. 4. The fraud cannot be calibrated. Fraud remains fraud and therefore, agents being found to be fraudulent by competent court, will straightway amount to disqualification to be continued as agent and in such a case such an agent would be liable to be visited with consequence of his right to earn and receive commission by invoking 19(1) of the Regulations. In any other case LIC also being party to the contract, forfeiture cannot be ordered. In any other case LIC also being party to the contract, forfeiture cannot be ordered. Regulation 16 which is invoked in the present case would not justify against of the LIC in forfeiting the right of the petitioner in receiving the commission as it is admissible under Regulation 19 (a), (b) and (c) as applicable to this case. Under these circumstances, I agree with the ultimate conclusion and direction given at para 17 of the present order. Appeal partly allowed.