2022 SCC Vol. 2 Part 2

Arbitration and Conciliation Act, 1996 — Ss. 31(7)(a), 28 and 34 — Award of interest: Arbitrator cannot award interest contrary to the terms of the agreement/contract between the parties. Bar under specific clause of the contract/agreement that no interest would be payable upon earnest money or security deposit or amounts payable to contractor under contract. In such a case, Arbitral Tribunal independently of the contract and on equitable grounds and/or to do justice, cannot award interest pendente lite or future interest. [Union of India v. Manraj Enterprises, (2022) 2 SCC 331]

Arbitration and Conciliation Act, 1996 — Ss. 34 and 28(3) — Setting aside of award on ground of patent illegality — What constitutes “patent illegality” — Explained: When arbitrator fails to decide matter in accordance with terms of contract governing parties, it will attract “patent illegality ground” as it amounts to gross contravention of S. 28(3). [State of Chhattisgarh v. SAL Udyog (P) Ltd., (2022) 2 SCC 275]

Civil Procedure Code, 1908 — Or. 21 R. 16 Expln. and Ss. 47 and 146: Transferee of rights in the property, which is the subject-matter of the suit, held, can obtain execution of a decree without separate assignment of decree. The objective is to avoid multifarious proceedings to determine the issue of assignment. Thus, the issue of assignment can be determined in the execution proceedings itself. [Vaishno Devi Construction v. Union of India, (2022) 2 SCC 290]

Civil Procedure Code, 1908 — S. 25 — Transfer of cases — Matrimonial dispute — Multiple proceedings between same parties — Transfer and consolidation of all proceedings before one court — When warranted: In this case petitioner wife was resident of Bengaluru and respondent husband, resident of Chennai. Petitioner wife filed two cases before the Family Court at Bengaluru i.e.: (1) petition under Guardians and Wards Act, 1890 for permanent custody of child, and (2) for restitution of conjugal rights. Respondent husband filed petition for divorce before Family Court at Chennai. All these petitions were pending for adjudication. It was held that it is in interest of justice that all these matters be heard by the same court. Hence, petition filed by respondent husband for divorce before Family Court at Chennai transferred to Family Court at Bengaluru. Principal Judge, Family Court at Bengaluru directed to assign these matters to the same court. [D. Raja Rajeswari v. R. Sathish Kumar, (2022) 2 SCC 329]

Coal Mines Pension Scheme, 1998 — Para 15(1)(b) r/w Para 15(2) — Nature of the Scheme and entitlement to benefit of: In this case, appellant’s husband opted to receive 90% pension during his lifetime as provided under Para 15(1)(b), consequent to which on his death on 12-1-2011, his widow was entitled to receive lump sum amount equal to 100 times his full monthly pension in addition to family pension. However, her application for payment of lump sum amount in terms thereof rejected vide order dt. 22-1-2013 on ground that Para 15(1)(b) was abolished on 21-2-2011 and 10% surrendered amount was refunded to all pensioners with interest on 30-1-2012. High Court by impugned judgment dismissed her petition challenging order dt. 22-1-2013, on ground of lack of territorial jurisdiction. 1988 Scheme was framed as measure of social security for ensuring socio-economic justice for employees in coal sector. Moreover, pension being deferred portion of compensation for rendering long years of service, a hard-earned benefit accruing to employee which is in nature of property, held, sum due to employee directed to be disbursed to appellant within stipulated time after adjusting amount refunded earlier. [Veena Pandey v. Union of India, (2022) 2 SCC 379]

Contract and Specific Relief — Performance of Contract — Time of Performance — Time of the Essence — Time whether of the essence of the contract — Determination of: Whether time is of the essence in a contract, has to be culled out from the reading of the entire contract as well as the surrounding circumstances and merely having an explicit clause may not be sufficient to make time of the essence of the contract. [Welspun Specialty Solutions Ltd. v. ONGC, (2022) 2 SCC 382]

Criminal Law — Public Accountability, Vigilance and Prevention of Corruption — Erring Official(s)/Dereliction of duty/Misfeasance or Malfeasance in office/Tort of Breach of Statutory Duty/Compensation/Relief/Costs/Probe/Punishment — Delay/laches in filing appeal: If more than Rs 5 crores is at stake, authorities, held, must recover it from the officer(s) concerned. [CCE v. Design Dialogues (India) (P) Ltd., (2022) 2 SCC 327]

Criminal Law — Public Accountability, Vigilance and Prevention of Corruption — Constitutional Authorities/Functionaries/High Public Offices — Security of Prime Minister (PM) of India: Judicial inquiry into breach and lapses as the convoy of PM was stuck on a flyover for around 20 minutes, ordered. Directions also issued for seizure, preservation and safe custody of all records relating to PM’s scheduled tour of State concerned on 5-1-2022. [Lawyers Voice v. State of Punjab, (2022) 2 SCC 399]

Environment Law — Mining and Industries — Mining lease — Grant of — Preparation of District Survey Report (DSRs) through private consultants for identification of potential sites for mining — Whether necessary: In view of provision for constitution of Sub-Divisional Committees comprising of officers of State Government from various Departments for identification of potential sites for mining in the Enforcement and Monitoring Guidelines for Sand Mining, 2020, and notification issued by MoEF and CC of 2016, held, there was no necessity of DSRs being prepared through private consultants. It would also unnecessarily burden public exchequer. [State of Bihar v. Pawan Kumar, (2022) 2 SCC 348]

Insolvency and Bankruptcy Code, 2016 — Ss. 238-A and 61: Non-supply of free copy of impugned order does not affect, and thus, shall not extend the limitation period for filing an appeal under S. 61 IBC. Scheme laid down in S. 421(3) of the Companies Act and S. 61(2) IBC, distinguished. [V. Nagarajan v. SKS Ispat & Power Ltd., (2022) 2 SCC 244]

Insolvency and Bankruptcy Code, 2016 — Ss. 30, 31 and 60(5) r/w S. 12-A: Withdrawal/Modification of resolution plan by successful resolution applicant, after its submission by Resolution Professional to adjudicating authority but before its approval by adjudicating authority is not permissible. [Ebix Singapore (P) Ltd. v. Educomp Solutions Ltd. (CoC), (2022) 2 SCC 401]

Insurance — Repudiation/Rescission of Insurance Policy — Repudiation of claim by insurer on ground of non-disclosure of relevant information/data — Tenability of: In this case there was non-disclosure of previous hydrology data of one year before obtaining policy by insured as said data was not available and the same was made known to the insurer. It was held that the Insurer was aware of earlier insurance policy obtained by respondent. Moreover, insurer did not ask for such hydrology data of previous year, even though the insured had informed it that it did not have the data for the said year. Thus, held, it cannot be said that there was suppression or non-disclosure of hydrology data or any fraud from side of respondent. Hence held, repudiation of claim on ground of non-disclosure/suppression of material information, not justified in this case. [Oriental Insurance Co. Ltd. v. Malana Power Co. Ltd., (2022) 2 SCC 365]

Land Acquisition Act, 1894 — Ss. 23, 18 and 4 — Determination of market value of land: When there are no material changes for period between two Notifications under S. 4, market value has to be determined for both notifications at the same rate. [Anil Kumar Soti v. State of U.P., (2022) 2 SCC 268]

Negotiable Instruments Act, 1881 — Ss. 138 and 142(a) — Complaint on behalf of company — Manner and form in which to be filed: Complaint filed by Managing Director on behalf of Company, held, cannot be dismissed only on ground that name of Managing Director is mentioned first followed by post held in company. There could be a format where Company’s name is described first, suing through Managing Director but merely because name of Managing Director is stated first followed by post held in Company, held, would not amount to a fundamental defect warranting dismissal of the complaint at the threshold. [Bhupesh Rathod v. Dayashankar Prasad Chaurasia, (2022) 2 SCC 355]

Negotiable Instruments Act, 1881 — Ss. 138/141 — Quashment of proceedings against corporate debtor under S. 138 NI Act after issuance of moratorium under S. 14 IBC: Ss. 138/141 of the NI Act proceeding against corporate debtor is covered by S. 14 (1)(a) IBC. Hence, corporate debtor cannot be proceeded against under S. 138 of the NI Act. [Nag Leathers (P) Ltd. v. Dynamic Mktg. Partnership, (2022) 2 SCC 271]

Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 — S. 13(3-A) r/w Ss. 13(2) and 13(4) — Challenging of auction-sale/SARFAESI action taken by Bank, on the premise of violation/non-compliance with S. 13(3-A) i.e. on account of alleged non-consideration of borrower’s representation post Bank’s notice: When there is disingenuous conduct on part of the borrower to gain indulgence, unfulfilled assurances and promises, and their unwillingness to pay, borrower had waived and was estopped from challenging the violation of S. 13(3-A) of SARFAESI Act. [Arce Polymers (P) Ltd. v. Alphine Pharmaceuticals (P) Ltd., (2022) 2 SCC 221]

Service Law — Appointment — Invalid appointment/Wrong appointment/Illegal appointment: In this case, appellants who had participated in selection process for post of English Stenographers appointed on leave vacancies for period of one month against posts of Hindi Stenographers, in terms of select list dt. 14-7-1987, since there were no vacancies for post of English Stenographers. Their appointment letters specifically stated that their appointments would be terminated once regular employees resume duties. Pursuant to fresh examination conducted for posts of  Stenographers — Appellants failing typing/speed test conducted for post of Hindi Stenographers. Despite that services of R-1 to R-3 terminated and appellants appointed on 5-6-1990 against posts held by them. The Supreme Court held,  that appointment of appellants and termination of services of R-1 to R-3 were rightly quashed by High Court since: (i) No appointment could be made in the year 1990 on basis of select list dt. 14-7-1987 whose validity was only for one year; (ii) Appellants had failed speed test for post of Hindi Stenographers; and (iii) Appellants were never appointed pursuant to due selection procedure as against respondents who were appointed after following due selection procedure. Further held, continuation of services of appellants pursuant to interim order passed by High Court were untenable and their services liable to be terminated. [Wahab Uddin v. Meenakshi Gahlot, (2022) 2 SCC 372]

Service Law — Departmental Enquiry — Employee’s right of representation — Choice of representation — Scope of: Right of representation by a counsel of one’s choice is not an essential element of natural justice and its denial does not invalidate enquiry. Representation is often restricted by law as also by Certified Standing Orders. Right to be legally represented depends on applicable rules governing such representation and where rules are silent, there is no absolute right to be legally represented. However, entitlement to fair hearing is not dispensed with and what fairness requires depend on nature of investigation and consequences it may have on persons affected by it. Where charge is of severe and complex nature, request to be represented through counsel should be considered, which is facet of fair hearing, applicable to judicial as well as quasi-judicial decisions. [SBI v. M.J. James, (2022) 2 SCC 301]

Succession Act, 1925 — S. 63 — Genuineness of will — Determination of: Evidence of meeting of the requirements of S. 63 r/w S. 68 of the Evidence Act, held, must inspire confidence and be credible. Requirements of S. 63 cannot be fulfilled merely upon showing of mechanical or technical compliance with the stipulations specified therein. [State of Haryana v. Harnam Singh, (2022) 2 SCC 238]

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