Bhopal, Mar 13 (UNI) The Madhya Pradesh government today admitted in the Assembly that the Reliance General Insurance Company had served a notice to the state Warehousing and Logistics Corporation for cancelling an insurance policy in the middle of its tenure.

Replying to a call attention notice moved by Mr Rajendra Kumar Singh (Congress), Civil Supplies Minister Gopal Bhargava said that the Corporation paid Rs 58.76 lakh as premium on four policies granting cover to godowns, by the Reliance company that was the lowest bidder in competitive bidding for 2006-07.

''Reliance served a cancellation notice within six months. The corporation took prompt action and succeeded in impressing upon Reliance its commitment to stick to the Memorandum of Understanding and continue to provide cover till March 30, 2007. The company also settled a claim case,'' he said.

Mr Bhargava rejected the demand for departmental inquiry against Corporation officials and added that the officials avoided wasteful expenditure.

Mr Singh, in his notice, sought that a criminal case be registered against Reliance Insurance for breach of MoU by demanding additional premium of Rs 1.08 crore in September, 2006. He also alleged complicity of corporation and insurance officials and sought a high-level probe.

UNI