Investing in tobacco firms not banned, LIC tells Bombay HC
Mumbai city news: LIC was replying to a public interest litigation objecting to public sector insurance companies investing in firms manufacturing tobacco productsmumbai Updated: Jun 24, 2017 22:30 IST
Investing in tobacco companies indirectly is neither prohibited nor banned by any authority, the Life Insurance Corporation of India (LIC) said in an affidavit filed in the Bombay high court.
LIC was replying to a public interest litigation objecting to public sector insurance companies investing in firms manufacturing tobacco products.
“Secondary investment in tobacco companies is neither prohibited nor banned by any authority,” says the affidavit filed by Vikas Chaturvedi, assistant secretary (investment operations) of LIC. “LIC is a corporate body and must function on business principles as far as possible. Ninety-five per cent of its surplus goes to policy vendors,” added the affidavit.
It added that the investment was in accordance with the provisions of the LIC Act, the Insurance Act and guidelines laid down by the Insurance Regulatory and Development Authority, and other prevailing rules and regulations. “LIC looked at several companies with a good track record for investment options,” said the affidavit, adding, “ITC is one such company.”
The affidavit was filed in response to a PIL by anti-tobacco activist Sumitra Pednekar and doctors attached to Tata Memorial Hospital. Meanwhile, the court allowed Karnataka state branch of Indian Medical Association to assist it by listing the ill-effects of tobacco.