Case BriefsTribunals/Commissions/Regulatory Bodies

Customs, Excise and Services Tax Appellate Tribunal (CESTAT): Ashok Jindal (Judicial Member) dismissed the application filed by the Revenue (CCE & ST, Panchkula) for ratification of mistake in a final order by the Tribunal which was noticed by the Applicant. The Tribunal dealt with two issues (a) whether to ratify previous order & (b) to deal with the jurisdiction.

The Department’s contention was that while deciding in the instant matters has wrongly relied upon the case of M/s. Sandvik Asia Ltd. v. CIT Pune as in this case the Apex Court was dealing with Section 214 and 244(1A) of the Income tax Act 1961 whereas nothing has been provided in the Central Excise Act, 1944/ Service Tax Act, 1994 at the relevant time. Authorized Representative while presenting this contention relied on a SC case where the Court had held that even there is mistake of law which however should be apparent on the face of record which does not need long drawn process of reasoning and can be subject matter of rectification of mistake.

For this the Tribunal held that it found no mistake apparent on the face of record after examining the definition of the phrase “error apparent on face of records”. Further, it held that “the applicant is seeking to challenge the merits of the order dated 07-01-2020 to recall the same which is not permissible in law as the same shall amounts to review of its own order.”

The Revenue also filed miscellaneous application for modification in order by this Tribunal to implead the Commissioner, CGST, Rohtak as the respondent in the final order dated 7-1-2020, the appellant had wrongly impleaded the Commissioner, CGST, CE & ST, Panchkula, as the correct respondent should have been the Commissioner of CGST & CE, Rohtak and asked that the order be recalled. The Respondents submitted that the Tribunal doesn’t have the power to hear at this stage- the issue of jurisdiction. It was further submitted that the jurisdiction of the appellant/respondent to the application lies with CGST, Panchkula Commissionerate.

The Tribunal held that “the jurisdiction for the purpose of every claim of refund, every proceeding of appeal, review or reference before this Tribunal shall be dealt under the provision Central Excise law and not by the provision of CGST law.” The jurisdiction of the appellant falls under the jurisdiction of DC Range Panipat and the DC Range, Panipat is under the jurisdiction of the Commissioner of CGST, Panchkula. The Tribunal found no merit in the application and it was subsequently dismissed.[Riba Textiles v. CCE & ST, Panchkula, 2021 SCC OnLine CESTAT 2635, decided on 30-12-2021]


Suchita Shukla, Editorial Assistant has reported this brief.


Present for the Appellant: Shri Dinesh Verma

Present for the Respondent: Shri H.S. Brar

Case BriefsHigh Courts

Delhi High Court: Stating that, Rape is an act against society, Rajnish Bhatnagar, J., held that simply entering into a compromise allegation of rape will not lose its gravity.

The instant petition was filed by the petitioner under Article 226 of the Constitution of India read with Section 482 of the Code of Criminal Procedure, 1973 for quashing and cancelling the FIR under Sections 376, 323 and 506 of Penal Code, 1860.

Information was received from PCR wherein it was reported that Complainant was not telling anything about the complaint but was asking for urgent police assistance and on reaching the place of the incident she said that she had a scuffle with her male friend (petitioner herein) who tried to assault her.

Complainant later disclosed the act of sexual assault having been committed upon her by the accused (petitioner herein) in his ICD Patparganj Office when she had gone to talk to him regarding their marriage.

Petitioner was a customs officer and met the complainant through the website Jeevansathi.com. He concealed the fact regarding his first love marriage and that his first wife committed suicide for which case was going on this Court.

After a few meetings and conversations, the complainant asked him to proceed with marriage talks, he called her to Faridabad and took the complainant to Vivanta by Taj Hotel and that night petitioner/accused raped her against her will.

Petitioner/accused also told the complainant that he would marry her in Arya Samaj Mandir, but later on, he made excuses that the mandir was closed and also told her to return to Ayodhaya. Later, he stopped picking her phone calls.

In March 2021, petitioner/accused reached Bhopal and put vermilion on the complainant and said that now they were husband and wife, but he did not let her meet his family. Further, in April, petitioner/accused raped her in a car. Complainant again lodged a complaint against petitioner/accused in NCW which finally reached Mahila Thana, Faridabad. In June, petitioner/accused came to that police station and again he made a promise to marry the complainant and accordingly she withdrew her complaint.

Again after a few days, the petitioner/accused molested the complainant and started fingering inside her private parts forcible after which the complainant lodged a PCR call but the petitioner/accused gave threats of dire consequences and ran away from the spot.

In view of the above, FIR was registered, and an investigation went underway.

Analysis, Law and Decision

High Court noted that the petitioner was a Government Servant, working as Superintendent with Customs & CGST Department, Govt. of India, holding a Gazetted post. Being a Government Servant was expected to maintain high moral rectitude and a decent standard of conduct in his personal/private life and not bring discredit to his service by his misdemeanours.

The charges of rape are of grave concern and cannot be treated in a casual manner.

The Bench observed that whether the High Courts, while exercising its jurisdiction under Section 482 CrPC should quash an offence under Section 376 IPC came for consideration before the Supreme Court in a number of cases.

Supreme Court has, time and again, directed that the High Court should not exercise its jurisdiction under Section 482 Cr.P.C to quash an offence of rape on the ground that the parties have entered a compromise.

 Catena of decisions were referred, such as:

In the present matter, the parties compromised amicably and respondent 2 filed an affidavit stating that she and the petitioner married each other and that she had no objection if the present FIR was quashed as she did not wish to pursue any proceedings.

“…by simply entering into a compromise, charges cannot be said to have been mitigated or that the allegations leveled by the respondent 2 regarding the alleged offence lost its gravity by any means. Act of rape is not an act against individual, but this is an offence against the society.”

In view of the legal position enumerated in Gian Singh v. State of Punjab, (2012) 10 SCC 303 along with other cases referred above, the criminal proceedings from FIR registered with allegations of rape cannot be quashed in exercise of powers vested in this Court under Section 482 CrPC on the basis of settlement and subsequent marriage as it would not waive off the offence alleged by the complainant.

Therefore, petition was dismissed. [Swatantara Kumar Jaysawal v. State, 2022 SCC OnLine Del 30, decided on 3-1-2022]


Advocates before the Court:

For the Petitioner:

Mr. Manoj Chaudhary and Mr. Sachin Anand, Adv.

Petitioner in person.

For the Respondents:

Mr Rajesh Mahajan, ASC with Ms Jyoti Babbar, Adv.

Mr Lalit Valecha, Adv. for R-2

R-2 in person.

Case BriefsHigh Courts

Delhi High Court: Subramonium Prasad, J., while explaining the facets of cancellation of bail and rejection of an application for bail, made an observation that,

Personal liberty is one of the cherished constitutional freedoms. Once granted to an accused pending completion of the Trial, it must only be retracted in the face of grave and exacerbating circumstances.

An application was filed under Section 439(2) of Criminal Procedure Code, 1973 read with Section 482 CrPC for cancellation of the anticipatory bail granted to respondents 2 to 5 passed by the Patiala House Court for the offence under Sections 354, 354A, 354B, 406, 498A, 506, 509, 34 of the Penal Code, 1860.

Complainant had given a complaint against her husband, mother-in-law and brother-in-law for offences under Sections 354, 354A, 354B, 406, 498A, 506, 509, 34 IPC.

Apprehending arrest, respondents filed an application under Section 438 CrPC seeking a grant of anticipatory bail.

Additional Sessions Judge found that the grievance of the complainant, that the matter had not been investigated fairly or that the investigating agencies acted in connivance with the accused could be addressed by moving the Metropolitan Magistrate and it is for the Metropolitan Magistrate to order further investigation under Section 173(8) CrPC.

The above-said order had been assailed by the complainant.

Trial Court granted anticipatory bail to the accused after considering the statements of the accused. Status Report noted that the respondents had joined the investigation and were cooperative, both before and after being granted protection from arrest by the Trial Court.

Difference between: Rejection of application for Bail v. Cancellation of Bail

Rejection of application for Bail

Cancellation of Bail

An order rejecting a plea for bail in non-bailable offences is in the discretionary domain of the Court and such a case can be decided without delving into details, it can be rejected simpliciter on the gravity of the offence and the perception that liberty, if granted, will be abused by the accused.

In the case of cancellation, the Court is called upon to extinguish the liberty that has been formerly granted.

When can a Court seize the liberty of an accused undertrial?

Stating that a Court must tread with the utmost circumspection, and only after an in-depth examination of the situation and new emergent facts and on finding supervening circumstances and overwhelming evidence that the accused has been abusing the liberty granted to him by the Court, Bench explained when a Court can exercise its jurisdiction in seizing the liberty of an accused undertrial.

Supreme Court in the decisions of Delhi Admn. V. Sanjay Gandhi, (1978) 2 SCC 411 and Dolat Ram v. State of Haryana, (1995) 1 SCC 349, expounded the position in law vis a vis cancellation of bail.

The power conferred under Section 439(2) CrPC has to be exercised in a discreet fashion, without dwelling on the merits of whether bail should have been granted or not and only upon viewing the subsequent conduct of an accused. The power is coupled with the reserve and caution, akin to the usage of the High Court’s inherent powers given under Section 482 CrPC.

Application for Cancellation of Bail and Grant of bail are different from each other, Bench added that High Court will not exercise its jurisdiction to interfere with an order of bail granted by Special Judge if there is no serious infirmity in it.

In the present matter, Court found the order of the ASJ to be well reasoned requiring no interference.

Lastly, the Court dismissed the petition noting that Court has not made any observation on the nature/manner of investigation, and if an application challenging the nature/manner of investigation is filed by the complainant, the Trial Court is requested to consider the same. [Charu Soneja v. State (NCT of Delhi), 2022 SCC OnLine Del 5, decided on 3-1-2022]


Advocates before the Court:

For the Petitioner: Mr K. K. Manan, Senior Advocate with Ms Uditi Bali and Ms Komal Vashist, Advocates

For the Respondent:  Ms Kusum Dhalla, APP for the State with SI Ravinder Kumar, PS Naraina Ms Kamlesh Mahajan, Advocate for R-2 to R-5

Case BriefsHigh Courts

Allahabad High Court: Dr Y.K. Srivastava, J., while examining the ambit and scope of Section 319 of the Code of Criminal Procedure, 1973 explained that,

“…broad principles which have been laid down for exercise of powers under Section 319 of the Code underline the object of the enactment that the real perpetrator of the offence should not get away unpunished and in a situation where the investigating agency for any reason does not array any culprit as an accused the court would not be powerless in calling the accused to face trial.”

Instant criminal revision had been filed seeking to set aside the decision passed by Additional Sessions Judge under Sections 307, 504 of Penal Code 1860 arising out of a case on the application of OP 2 filed under Section 319 of the Code of Criminal Procedure, 1973.

Ambit and Scope of Magistrates’ powers

Scope and the ambit of the powers of the Magistrate under Section 319 of the Code were considered in the Constitution Bench judgment of the Supreme Court in Hardeep Singh v. State of Punjab, (2014) 3 SCC 92. Referring to the object of the provision it was held that the object of the provision was that the real culprit should not get away unpunished and in a situation where the investigating agency for any reason does not array one of the real culprits as an accused, the court is not powerless in calling the said accused to face trial.

Further, with regard to the degree of satisfaction required for invoking the powers under Section 319 of the Code, it was held that the test that has to be applied is one which is more than prima facie case as exercised at the time of framing of charge, but short of satisfaction to an extent that the evidence, is goes unrebutted, would lead to conviction.

The question as to what situations power under the Section 319 of the Code of Criminal Procedure, 1973 can be exercised in respect of persons not named in the FIR or named in FIR, but not charge-sheeted or discharged was also considered, and it was held that a person whose name does not appear even in the FIR or the charge-sheet or whose name appears on the FIR and not in the charge sheet, can still be summoned by the Court provided the conditions under the said Section stand fulfilled.

Elaborating further, power to proceed against persons named in FIR with specific allegations against them, but not charge-sheeted, was reiterated in Rajesh v. State of Haryana, (2019) 6 SCC 368 and it was held that persons named in the FIR but not implicated in charge- sheet can be summoned to face trial, provided during the trial some evidence surfaces against the proposed accused.

The court below had taken note of the fact that the revisionist was not only named in the F.I.R. but was also assigned a role in the incident.

Upon considering the settled legal position with regard to exercise of powers under Section 319, the court below passed the order summoning the revisionist.

Moving further, the Bench expressed that Section 319 (1) of the Code envisages that where, in the course of any inquiry into, or trial of, an offence, it appears from the evidence that any person not being the accused has committed any offence for which such person could be tried together with the accused, the Court may proceed against such person for the offence which he appears to have committed.

High Court held that power under Section 319 of the Code to summon even those persons who are not named in the charge-sheet to appear and face trial, being unquestionable and the object of the provision being not to allow a person who deserves to be tried to go scot-free by being not arraigned in the trial inspite of possibility of his complicity which can be gathered from the evidence during the course of trial, the order passed under Section 319 of the Code summoning the revisionist does not contain any material error so as to warrant inference.

Applicant’s counsel stated that it would not dispute the aforementioned legal position with regard to the exercise of powers under Section 319 of the Code and stated that the applicant would submit to the jurisdiction of the court below and seek bail.

In view of the above discussion, the revision stood dismissed. [Mishri Lal v. State of U.P., 2021 SCC OnLine All 839, decided on 4-12-2021]


Advocates before the Court:

Counsel for Revisionist: Kamal Dev Rai

Counsel for Opposite Party: G.A.

Case BriefsHigh Courts

Delhi High Court: Chandra Dhari Singh, J., while addressed an issue with regard to maintenance and stated that,

There may be alternative jurisdictions available to the person seeking execution of order of maintenance and it is upon the meeting of the requirements of the provisions that the person “may” approach the concerned court in the appropriate jurisdiction.

Instant petition was filed to set aside the order passed by the Family Court.

Petitioner 1 and respondent were wife and husband while petitioners 2 and 3 were the daughter and son respectively.

Factual Background

Petitioner had filed maintenance petition under Section 125 CrPC vide an order whereby the respondent was directed to pay Rs 1000 to the petitioner 1 and Rs 500 per month to petitioner 2, 3 and the third daughter.

Further, the petitioner moved the Court for the execution of the Order which withdrawn on account of the settlement between the parties before the Mediation Centre, Dwarka Courts. However, the respondent did not comply with the terms laid down in the settlement agreement and hence the petitioner filed another execution petition before the Family Court, Dwarka for the execution of the maintenance order.

Respondent in compliance with the maintenance order was paying a certain amount in pursuance of which the petitioners sought liberty from the trial court to amend/withdraw and refiled the petition with the prayer of payment of arrears of maintenance amount and warrants of attachment in case of failure on part of the respondent.

Trial Court passed the impugned order whereby it noted that Memo of Parties in the Execution Petition indicated that the respondent resided at Bharti Nagar, District Shaharsa, Bihar and that the petitioner can seek execution of the maintenance order before the Courts in Shaharsa, Bihar. Hence, the trial court directed that a transfer certificate may be issued for execution against the respondent.

Petitioner through the present petition has sought to set aside the said order of the trial court.

Analysis, Law and Decision

High Court expressed that from a bare reading of Section 126 read with Section 128 of the CrPC, it is apparent that a person may file for maintenance and have the proceedings initiated under Section 125 of the CrPC before the Magistrate concerned in any district where the husband is, where he or the wife resides or where they have last resided.

The Code gives ample prerogative with respect to the jurisdiction where the person seeking maintenance may file for the same and its subsequent execution.

The words used are, ‘where the person against whom it is made may be’ and not where he is residing or where his permanent property is. The material fact, hence, would be the presence of the person at the preferred jurisdiction at the time of the application for maintenance.

Section 125(3) CrPC, empowers the Magistrate to issue a warrant for levying the amount due in the manner provided for levying fines, where there is default of payment in contravention of the orders of maintenance by the Magistrate. The same is guided by the provisions under Section 421 and 422 of the CrPC., which authorize the Court concerned to sell or attach a property even outside its jurisdiction.

In the present matter, it is evident that, if required, a property situated in Bihar, may be attached for the purposes of obtaining maintenance upon the order passed by the Courts in Delhi.

The Bench stated that as per the provisions under the CrPC and the findings of the Courts clear on the issue of jurisdiction in cases of maintenance under Section 125 of the CrPC.

Court makes available the option to the wife to proceed before a Court for maintenance and its execution where either the husband is, or where either of the parties resides as well as the place where they used to reside.

Supreme Court had even ruled that a judicial process may be enforced against a person even when he is in abroad.

In the present matter, while the Petitioner-wife may have approached the Courts concerned in Bihar, where the Respondent was alleged to have his permanent residence and the immovable property, simultaneously, her right to approach a Court in New Delhi also subsisted.

The rights of the Petitioners were in consonance with the provisions of the law, since the respondent used to reside in Delhi at the time of application. Moreover, the Petitioners had the opportunity to execute within the jurisdiction of the Court where the order of maintenance was passed.

Further, the Bench stated that the order of maintenance was passed in the year 2005 and now the trial court had after 16 years of the order and 4 years into the matter of execution taken up the issue of maintainability, despite the clear mandate of the CrPC.

Examining further, the Court added that it is unfortunate that a woman and her children have to run pillar to post to avail their rights to which they are entitled under the law of the country.

In view of the above discussion, the petition was allowed.

Trial Court erred while giving its finding as the petitioner was well within her right under the law for having the maintenance order executed in her favour within the jurisdiction of Delhi.

The matter has been remanded back to the family court with direction for fresh adjudication of the execution petition. [Asha Devi v. Muneshwar Singh, 2021 SCC OnLine Del 5452, decided on 17-12-2021]


Advocates before the Court:

For the Petitioners: Mallika Parmar, Advocate (DHCLSC)

Fort Respondent: Kunal Malhotra and Ravinder Gaur, Advocates

Case BriefsHigh Courts

Allahabad High Court: Dr Yogendra Kumar Srivastava, J., while examining the scope of the writ of habeas corpus, expressed that,

The power of the High Court, in granting a writ, in child custody matters, may be invoked only in cases where the detention of a minor is by a person who is not entitled to his/her legal custody.

Petitioner 1 asserted himself to be the father of the petitioner 2 corpus and filed the present habeas corpus petition alleging that the corpus was under illegal custody of his mother-respondent 4.

Writ of Habeas Corpus

Writ of habeas corpus is a prerogative writ and an extraordinary remedy, it is writ of right and not a writ of course and may be granted only on reasonable ground or probable cause being shown, as held in Mohammad Ikram Hussain v. State of U.P., AIR 1964 SC 1625 and Kanu Sanyal v. District Magistrate Darjeeling, (1973) 2 SCC 674.

The object and scope of a writ of habeas corpus in the context of a claim relating to custody of a minor child fell for consideration in Sayed Saleemuddin v. Dr Rukhsana, (2001) 5 SCC 247, and it was held that in a habeas corpus petition seeking transfer of custody of a child from one parent to the other, the principal consideration for the Court would be to ascertain whether the custody of the child can be said to be unlawful or illegal and whether the welfare of the child requires that the present custody should be changed.

Maintainability of Habeas Corpus Petition

The question of maintainability of habeas corpus petition under Article 226 of the Constitution of India for custody of a minor was examined in Tejaswini Gaud v. Shekhar Jagdish Prasad Tewari, (2019) 7 SCC 42 and it was held that the petition would be maintainable where detention by parents or others is found to be illegal and without any authority of law and the extraordinary remedy of a prerogative writ of habeas corpus can be availed in exceptional cases where ordinary remedy provided by the law is either unavailable or ineffective.

High Court stated that the exercise of extraordinary jurisdiction for issuance of a writ of habeas corpus would, therefore, be seen to be dependent on the jurisdiction fact where the applicant establishes a prima facie case that the detention is unlawful.

Only where the above-mentioned jurisdictional fact is established the applicant would become entitled to the writ as of right.

Further, the Bench added that the role of the High Court in examining cases of custody of a minor, in a petition for a writ of habeas corpus, would have to be on the touchstone of the principle of parens patriae jurisdiction and the paramount consideration to be the welfare of the child.

In the present matter, petitioner 2 was of the age of 6 years and under the exclusive care and custody of his mother since the time he was an infant of about 2 years of age.

Custody with Mother: Lawful or Unlawful?

High Court stated that, the private respondent was none other than the biological mother of the minor child. This being the fact, it may be presumed that the custody of the child with his mother is not unlawful.

It would only be in an exceptional situation that the custody of a minor may be directed to be taken away from the mother for being given to any other person-including father of the child, in exercise of writ jurisdiction.

 In view of the above discussion, Court did not exercise its extraordinary jurisdiction to entertain the petition seeking a writ of habeas corpus. [Sushil Kumar Tiwari v. State of I.P., 2021 SCC OnLine All 882, decided on 6-12-2021]


Advocates before the Court:

Counsel for Petitioner:- Maqsood Ahmad Beg, Naiyar Masroof Siddiqui

Counsel for Respondent :- G.A.

Case BriefsHigh Courts

Delhi High Court: Subramonium Prasad, J., expressed that,

“…it is unfortunate that institutions that are supposed to protect the life and liberty of common citizens are quick to shirk their responsibilities.”

Background

Petitioner filed an FIR disclosing an allegation of sexual assault against her that has taken place from 2008 to 2019 at various places.

In view of the above, the petitioner registered a complaint regarding the crime of fraud, forgery and conspiracy towards forging marriage certificates, committing rape, getting an abortion done by the accused who forced the petitioner to ingest poisonous products and attempted murder.

When the petitioner used to live with her parents, one of the accused forcefully initiated a physical relationship with her, initially on account of their familiar relationship, the petitioner did not take any legal action against him. However, despite knowing that the petitioner was his sister, the accused tortured her physically, mentally and ruined her entire career.

Accused even raped the petitioner when the mother of the accused went to live at the petitioner’s Kanpur residence.

It is stated that when the Petitioner insisted on registering a police complaint against the accused and his family, then accused, and brother of accused, with the help of their sister, poured kerosene on the Petitioner and set her on fire. However, on realizing that the said act could lead to the petitioner’s death, they put off the fire.

Further, it was stated accused persons threatened the Petitioner and told her that she would have to remain as mistress/wife of the accused forever and would have to satisfy his lust.

In view of the above circumstances, the petitioner was unable to register a complaint. Later in the year 2011, when petitioner started living alone, accused started telling people that she was his wife. Further, he consistently raped the petitioner and threatened her with a revolver and a knife. On petitioner becoming pregnant, she was forcible made to ingest abortion pills and her foetus was aborted.

Accused took the petitioner to Arya Samaj Mandir and forged documents to showcase that he and the petitioner were married.

He used to keep the petitioner as a hostage at their rented house to satisfy his lust. In the year 2013, the petitioner again got pregnant, and Ajay forcefully made the petitioner abort the child by giving her medicines.

In the year 2013, when the petitioner father came to know of the above-stated, he died of shock and during that time, Ajay with the help of his wife took the petitioner to Kanpur and raped her while his wife made a video of the same.

Petitioner believed that her life is in complete danger and which is why she approached the Police Station GTB Enclave for registration of an FIR under the appropriate provisions of the Penal Code, 1860 against the four accused.

Since the Police denied registering the complaint, she moved to the Court of Metropolitan Magistrate by way of an application under Section 156 (3) CrPC.

Metropolitan Magistrate directed the SHO to file an action report as a result of which petitioner was taken for a medical examination. After this, an FIR under Sections 354, 376, 506 IPC was registered.

The case was registered vide ‘Zero FIR’ and the investigation had been transferred to Police Station Indrapuram, Ghaziabad, Uttar Pradesh.

Despite the admission that one incidence had occurred within the jurisdiction of GTB Enclave, Respondents 2 and 3 transferred the case to Respondents 4 and 5. It was stated that subsequently, the Petitioner moved an application before the Metropolitan Magistrate concerned on 12-09-2019 referring to the applicability of Section 178(d) CrPC seeking action for intentional non-registration of FIR and also calling for an explanation for unlawful transfer of the investigation despite having jurisdiction over the matter.

Further, despite another application preferred by the petitioner seeking preservation of evidence and recording of the statement of the prosecutrix, Police Station GTB did not make any endeavour to collect the evidence, preserve it or take the statement of the petitioner, and rather chose to transfer the matter to respondents 2 and 5.

Metropolitan Magistrate vide Order dated 12-09-2019 called for the report from DCP Shahdara seeking an explanation for the transfer of the investigation despite admission that one incident had taken place within the jurisdiction of Police Station GTB Enclave. Further, t was submitted by DCP Shahdara that during the medical examination, the Petitioner had disclosed that the sexual intercourse had taken place in Indrapuram, Ghaziabad, U.P., and that an FIR had already been registered at Police Station Indrapuram on 12.09.2019 under Sections 354, 376, 506 IPC.

Petitioner approached this court since her grievance have remained unsolved and she has been subjected to a lot of threats from the accused.

Analysis, Law and Decision

What constitutes ‘Zero FIR’?

As per Section 154 CrPC, if any information relating to the commission of any cognizable offence is received by a Police Station, the police is duty-bound to register the FIR.

However, if the crime does not occur within the jurisdiction of the said police station, then the registration of the ‘Zero FIR’, same has to be transferred to the Police Station concerned where the offence has indeed been committed.

Hence, the place of crime and jurisdiction of the police station becomes irrelevant when a cognizable offence is disclosed, and the police station is obligated to instantly transfer the pertinent documents over to the police station vested with the jurisdiction which numbers the FIR and begins the investigation.

Difference between FIR and Zero FIR

The bench noted that the only difference between FIR and Zero FIR is that an FIR is registered where the incident had occurred within the jurisdiction of a particular Police Station, and a Zero FIR can be lodged at any Police Station irrespective of where the incident has taken place.

Motive of Zero FIR is to provide quick redressal to the victim so that timely action can be taken after registration of the FIR.

In the present matter, one of the incidents of forceful sexual assaults had taken place in the GTB Enclave area.

The Police Station GTB Enclave was obligated to register an FIR and not a “Zero FIR”, and not delve into whether the Petitioner resided in the city or what was the specific time, date and place of the alleged incident.

High Court remarked that,

By embarking on the journey of trying to get the investigation transferred to Ghaziabad, U.P., Police Station GTB Enclave has displayed a failure in dispensation of their obligation to take into account the seriousness and gravity of the offence that has been disclosed by the Petitioner in the complaint.

“…mere disclosure that one of the incidents had taken place within the vicinity of Police Station GTB Enclave was sufficient for an FIR to be registered at that Police Station, and not a Zero FIR as was done in the instance case.”

Under Section 482 CrPC, the High Court has inherent power to take the necessary action as sought for in the present petition and direct for the registration of the FIR at PS GTB Enclave.

High Court directed respondents to register a regular FIR instead of a zero FIR and conduct an investigation. [X v. State, 2021 SCC OnLine Del 5158, decided on 30-11-2021]


Advocates before the Court:

For the Petitioner: Mr R.N. Dubey, Mr Vinay Sharma, Advocates

For the Respondents: Ms Richa Kapoor, ASC for the State with Ms Shivani Sharma and Ms Surabhi Katyal, Advocates Inspector Arun Kumar, SHO/P.S. GTB Enclave.

Case BriefsSupreme Court

Supreme Court: Explaining the scope of jurisdiction of ITAT, the bench of MR Shah* and BV Nagarathna, JJ has held that the powers under Section 254(2) of the Income Tax Act are only to correct and/or rectify the mistake apparent from the record and not beyond that.

In the present case, a detailed order was passed by the ITAT when it passed an order on 06.09.2013, by which the ITAT held in favour of the Revenue. The said order was then recalled on 18.11.2016. It is pertinent to note that the order was recalled while exercising the power under Section 254(2) of the Act as the Assessee had filed miscellaneous application for rectification under Section 254(2) of the Act. While allowing the application under Section 254(2) of the Act and recalling its earlier order dated 06.09.2013, the ITAT had re-heard the entire appeal on merits as if the ITAT was deciding the appeal against the order passed by the C.I.T.

It was argued before the Court that the Revenue itself had in detail gone into merits of the case before the ITAT and the parties filed detailed submissions based on which the ITAT passed its order recalling its earlier order. The Court, however, rejected the said contention and held that,

“Merely because the Revenue might have in detail gone into the merits of the case before the ITAT and merely because the parties might have filed detailed submissions, it does not confer jurisdiction upon the ITAT to pass the order de hors Section 254(2) of the Act.”

In exercise of powers under Section 254(2) of the Act, the Appellate Tribunal may amend any order passed by it under sub-section (1) of Section 254 of the Act with a view to rectifying any mistake apparent from the record only. Therefore, the powers under Section 254(2) of the Act are akin to Order XLVII Rule 1 CPC. While considering the application under Section 254(2) of the Act, the Appellate Tribunal is not required to re-visit its earlier order and to go into detail on merits.

Further, if the Assessee was of the opinion that the order passed by the ITAT was erroneous, either on facts or in law, in that case, the only remedy available to the Assessee was to prefer the appeal before the High Court.

Therefore, it was held that the order passed by the ITAT recalling its earlier order dated 06.09.2013 which has been passed in exercise of powers under Section 254(2) of the Act is beyond the scope and ambit of the powers of the Appellate Tribunal conferred under Section 254 (2) of the Act.

[Commissioner of Income Tax v. Reliance Telecom Ltd., 2021 SCC OnLine SC 1170, decided on 03.12.2021]


Counsels

For Revenue: Additional Solicitor General Balbir Singh

For Respondent: Advocate Anuj Berry


*Judgment by: Justice MR Shah

Know Thy Judge | Justice M. R. Shah

Case BriefsHigh Courts

Bombay High Court: Sandeep K. Shinde, J., held that an aggrieved person cannot choose to file a petition under Section 12 of the Domestic Violence Act at any and every place, even if she was a mere casual visitor to that place.

Instant petition assailed the order by which the Metropolitan Magistrate refused to entertain an application under Section 12 of the Domestic Violence Act, 2005 for want of jurisdiction envisaged under Section 27 of the said Act and in consequence, directed to return the application to the petitioner.

Analysis, Law and Decision

High Court stated that every statute has to be interpreted keeping in mind the purpose for which it has been enacted and the interpretation must be such, so as to advance the purpose of the act and should not be such as to defeat, the intention of the legislature.

In the case on hand, since after applicant’s marriage, she was continuously residing in Hyderabad. It appeared that she was subjected to domestic violence at Hyderabad, whereupon she had filed a complaint.

Later, she came to Mumbai and resided in a hotel situated within the local limits of Metropolitan Magistrate, Bandra. Soon thereafter, she filed two non-cognizable complaints and reported that she was forced to flee to Mumbai, to protect herself and she believed and apprehended being under constant surveillance at the instance of her husband and son in their attempt to keep a watch on her actions, whereby she was frightened and harassed by them.

Whereafter, she filed an application under Section 12 of the D.V. Act, which was within 23 days, after her arrival in Mumbai from Hyderabad.

Court noted from the complaint, and argument that Respondents being highly influential persons in Hyderabad and although applicant ventured to lodge a complaint against them, she won’t be able to secure any relief from police or such other agency under the D.V. Act. From 1993 till 2021 she was subjected to domestic violence, she did not take any measure to protect her life, property or to prevent the respondents from causing or inflicting domestic violence to her.

Question for Consideration

 Whether application under Section 12 filed by the Petitioner discloses or implies her intention to reside at a place in Mumbai or was it just casual or flying visit to acquire jurisdiction?

In Court’s opinion looking at the applicant’s background it was difficult to accept her contention that she could not seek a protection order at Hyderabad.

“…application in no way suggest or implies that she was forced to leave the Hyderabad and or she was intending to reside in Mumbai.”

In view of the chronology of the events, applicant engineered the cause of action with an intention to file a case and confer jurisdiction upon the Magistrate.

Thus, Court held that the applicant was not “temporarily” residing within the jurisdiction of the Court of Magistrate and no cause of action arose in Mumbai. The facts of the case suggest that the applicant’s visit to Mumbai was ‘casual visit’ and did not imply a definite intention to stay at a particular place. Therefore, Magistrate’s order cannot be faulted with, either for wrong or non-exercise of jurisdiction.

“…if liberal construction is placed upon the provision, made under Section 27 of the Act, as sought by the Applicants, it may lead to abuse of legal process of law, as aggrieved person may choose, any place, where she may be a casual visitor.”

Hence, impugned order declining to entertain, petitioner’s application under Section 12 for want of jurisdiction could not be faulted with.  [Afia Rasheed Khan v. Dr Mazharuddin Ali Khan, 2021 SCC OnLine Bom 4605, decided on 3-12-2021]


Advocates before the Court:

Mr. Rizwan Merchant a/w Ms. Z. Abdi i/by Mr. Rizwan Merchant and Associates, Advocate for Petitioner.

Mr. K. Krishna Shrawan i/by Mr. Ajay Khaire, Advocate for 1 and 2.

Ms. M.R. Tidke, APP for State/ Respondent 3.

Case BriefsSupreme Court

Supreme Court: The Division Bench of Ajay Rastogi* and Abhay S. Oka, JJ.,    set aside the judgment of the Delhi High Court wherein it had substituted the penalty of removal from service with confinement of respondent from 1.00 p.m. to 10.00 p.m. in quarter guard jail without noticing the mandate of the nature of punishments indicated under Section 11(1) of the Central Reserve Police Force Act, 1949 (CRPF). The Bench expressed,

“The scope of judicial review on the quantum of punishment is available but with a limited scope. It is only when the penalty imposed appears to be shockingly disproportionate to the nature of misconduct that the Courts would frown upon.”

Factual Matrix

In 2003, the wife of respondent was under treatment of Dr. Nazir, Gynaecologist (complainant). The case against the respondent was that he along with his wife had forcibly entered into the chamber of the complainant and asked him to attest the reimbursement of medical claims and upon his refusal, the respondent verbally abused and physically struck the Complainant, resulting in injuries. The respondent not only misbehaved and abused the complainant while on duty but to conceal his misconduct, he made a false allegation of sexual harassment on his wife against the complainant.

A departmental inquiry was conducted by the disciplinary authority and after affording an opportunity of hearing, the disciplinary authority found both the charges proved against the respondent. Therefore, taking note of the gravity of the charges and all other factors into consideration, the authorities concerned punished the respondent with the penalty of removal from service.

Observation and Analysis

The scheme of Section 11 of the Act 1949 mandates that the competent authority may, subject to rules made thereunder, award in lieu of, or in addition to, suspension or dismissal any one or more punishment if found guilty of misconduct in his capacity as member of the force. The use of words ‘in lieu of, or in addition to, suspension or dismissal’, appearing in Section 11(1) clearly indicates that the authorities mentioned therein are empowered to award punishment of suspension or dismissal to member of the force who is found guilty and in addition to, or in lieu thereof, the punishment mentioned in clause (a) to (e) may also be awarded.

Considering the Statutory provisions, the Bench opined that Section 11 of the Act 1949 had been completely overlooked by the High Court while examining as to whether the punishment of removal from service could be inflicted in lieu of or in addition to dismissal from service to member of the force, if the misconduct stands proved in the course of disciplinary inquiry. Stating out the difference between dismissal and removal from service, the Bench said,

“The only difference between the two is that in the case of dismissal, it precludes the employee from seeking future employment in the Government while in the case of removal, he is not disqualified from any future employment.”

Opining that the nature of allegations against the respondent was grave in nature, the Bench termed the same as unpardonable once proved. The Bench observed that if the authority had considered it appropriate to punish the respondent with penalty of removal from service, it would leave no place for sympathy for retention in service and that too in a discipline force like CRPF.

Scope of judicial discretion

“The well ingrained principle of law is that it is the disciplinary authority, or the appellate authority in appeal, which is to decide the nature of punishment to be given to the delinquent employee.”

Opining that it is not open for the Courts to assume and usurp the function of the disciplinary authority, the Bench stated that even in cases where the punishment imposed by the disciplinary authority is found to be shocking to the conscience of the Court, normally the disciplinary authority or the appellate authority should be directed to reconsider the question of imposition of penalty. The Bench clarified, it is only in rare and exceptional cases where the court might to shorten the litigation may think of substituting its own view as to the quantum of punishment in place of punishment awarded by the competent authority that too after assigning cogent reasons.

Conclusion

Consequently, the Bench opined that the High Court had fell in error in interfering with the punishment, which could lawfully be imposed by the departmental authorities for his proven misconduct and the High Court should not have substituted its own discretion for that of the authority; as what punishment was required to be imposed, was a matter which fell exclusively within the jurisdiction of the competent authority.

Accordingly, the Bench observed that the scheme of the Act 1949 of which reference had been made was completely overlooked by the High Court and interference had been made in the quantum of punishment which may not apply to member of the discipline force. Consequently, the appeal was allowed and the impugned judgment was set aside.

[Union of India v. Ex. Constable Ram Karan, 2021 SCC OnLine SC 1041, decided on 11-11-2021]


Kamini Sharma, Editorial Assistant has put this report together


Appearance by:

For Union of India: Madhavi Divan, ASG

For the Respondent: Ashok Agrwaal, Advocate


*Judgment by: Justice Ajay Rastogi

Know Thy Judge | Justice Ajay Rastogi

Case BriefsTribunals/Commissions/Regulatory Bodies

National Consumer Disputes Redressal Commission (NCDRC):  Expressing its opinion of ‘Condonation of Delay’, Coram of C. Viswanath (Presiding Member) and Justice Ram Surat Ram Maurya (Member) dismissed the present appeal calling it an abuse of process of law.

Instant appeal was filed against the decision of the State Consumer Disputes Redressal Commission. Further, along with the appeal, an application for condonation of delay of 13 years was also filed by the appellant.

Section 14 of the Limitation Act 

“14 Exclusion of time of proceeding bona fide in court without jurisdiction. —

(1) In computing the period of limitation for any suit the time during which the plaintiff has been prosecuting with due diligence another civil proceeding, whether in a court of first instance or of appeal or revision, against the defendant shall be excluded, where the proceeding relates to the same matter in issue and is prosecuted in good faith in a court which, from defect of jurisdiction or other cause of a like nature, is unable to entertain it.

(2) In computing the period of limitation for any application, the time during which the applicant has been prosecuting with due diligence another civil proceeding, whether in a court of first instance or of appeal or revision, against the same party for the same relief shall be excluded, where such proceeding is prosecuted in good faith in a court which, from defect of jurisdiction or other cause of a like nature, is unable to entertain it.

(3) Notwithstanding anything contained in rule 2 of Order XXIII of the Code of Civil Procedure, 1908 (5 of 1908), the provisions of sub-section (1) shall apply in relation to a fresh suit instituted on permission granted by the court under rule 1 of that Order where such permission is granted on the ground that the first suit must fail by reason of a defect in the jurisdiction of the court or other cause of a like nature. Explanation.— For the purposes of this section,—

(a) in excluding the time during which a former civil proceeding was pending, the day on which that proceeding was instituted and the day on which it ended shall both be counted; 

(b) a plaintiff or an applicant resisting an appeal shall be deemed to be prosecuting a proceeding; 

(c) misjoinder of parties or of causes of action shall be deemed to be a cause of a like nature with defect of jurisdiction.”

 It was noted that the Opening sentence of Section 14 of the Limitation Act says “exclusion of time of proceeding bona fide in court without jurisdiction.”

In the present matter, Opposite Party (OP) tried to take undue benefit of Section 14 of the Act and not act bonafidely. Appellant had malafide intention to evade implementation of the order passed by the State Commission.

Further, Supreme Court has held that a party who has not acted diligently or remains inactive is not entitled to condonation of delay

Elaborating further on condonation of delay, Court observed that Condonation of delay is not a matter of right and the applicant has to set out the case showing sufficient reasons which prevented them to come to the Court/Commission within the stipulated period of limitation.

Supreme Court in the matter of Ram Lal v. Rewa Coalfields Ltd., AIR 1962 Supreme Court 361 has held as under:

“It is, however, necessary to emphasize that even after sufficient cause has been shown a party is not entitled to the condonation of delay in question as a matter of right. The proof of a sufficient cause is a condition precedent for the exercise of the discretionary jurisdiction vested in the Court by Section 5. If sufficient cause is not proved nothing further has to be done; the application for condoning delay has to be dismissed on that ground alone. If sufficient cause is shown then the Court has to enquire whether in its discretion it should condone the delay. This aspect of the matter naturally introduces the consideration of all relevant facts and it is at this stage that diligence of the party or its bona fides may fall for consideration; but the scope of the enquiry while exercising the discretionary power after sufficient cause is shown would naturally be limited only to such facts as the Court may regard as relevant.” 

Burden of showing delay is on whom?

Coram stated that the burden is on the applicant to show that there was sufficient cause for the delay.

In the Supreme Court decision of Anshul Aggarwal v. NOIDA, (2011) 14 SCC 578, Supreme Court warned the Commissions to keep in mind while dealing with such applications the special nature of the Consumer Protection Act.

In a recent judgment the Supreme Court observed that condonation of delay would depend on the background of each and every case, and routine explanation would not be enough.

Hence, in the present matter, appellant’s submission that he got the knowledge of the impugned order on 31-01-2017 was nothing but an attempt to mislead the Court.

Therefore, the present first appeal was just an abuse of process of law. [Suranjan Biswas v. Ashoke Kumar Nath, FA No. 1005 of 2019, decided on 15-11-2021]


Advocates before the Commission:

For the Appellant: Ramdulal Manna, Advocate

Case BriefsSupreme Court

Supreme Court: In a case where the Punjab and Haryana High Court not only set aside the judgment of the District Judge rejecting the petition under Section 34 of the Arbitration and Conciliation Act 1996, but also awarded the claim of the respondents, together with interest, the bench of Dr. DY Chandrachud* and AS Bopanna, JJ set aide the said judgment after holding that the High Court seems to have proceeded as if it was exercising jurisdiction in a regular first appeal from a decree in a civil suit.

It explained,

“The jurisdiction in a first appeal arising out of a decree in a civil suit is distinct from the jurisdiction of the High Court under Section 37 of the 1996 Act arising from the disposal of a petition challenging an arbitral award under Section 34 of the 1996 Act.”

The judgment of the District Judge, rejecting the petition under Section 34 of the 1996 Act, was challenged before the High Court under Section 37 of the 1996 Act. The High Court allowed the appeal, inter alia, on the ground that the award lacked reasons and the reasons which were assigned were arbitrary and erroneous. Having held that the award was liable to be set aside, the High Court decreed the claim of the respondents for the supply of 22,389 wooden batons, together with the security deposit of Rs 1,00,000 and awarded interest at the rate of 12% from the date from which the amount became due.

In the present case, the High Court was required to determine as to whether the District Judge had acted contrary to the provisions of Section 34 of the 1996 Act in rejecting the challenge to the arbitral award. The arbitrator was entitled to draw relevant findings of fact on the basis of the evidence which was adduced by the parties. This was exactly what was done in the arbitral award. The award of the arbitrator was challenged unsuccessfully by the respondents under Section 34 of the 1996 Act.

“While considering a petition under Section 34 of the 1996 Act, it is well-settled that the court does not act as an appellate forum. The grounds on which interference with an arbitral award is contemplated are structured by the provisions of Section 34.”

The Court noticed that the District Judge had correctly come to the conclusion that there was no warrant for interference with the arbitral award under Section 34. Hence, apart from its failure to do so, the High Court went one step further while reversing the judgment of the District Judge in decreeing the claim in its entirety. This exercise was clearly impermissible.

It was, hence, held that there was no legal basis for the High Court to interfere with the judgment of the District Judge and, as we have noted earlier, to even go a step further by decreeing the claim.

[Punjab State Civil Supplies Corporation Ltd. v. Ramesh Kumar and Company, 2021 SCC OnLine SC 1056, decided on 13. 11.2021]

*Judgment by: Justice Dr. DY Chandrachud

Case BriefsHigh Courts

Uttaranchal High Court: Emphasizing on the purpose and object of Section 9 of the Arbitration and Conciliation Act, 1996, Division bench of Raghvendra Singh Chauhan, CJ and Alok Kumar Verma, J., held that,

A person not a party to an arbitration agreement cannot invoke jurisdiction of the Court for interim relief under Section 9 of the Act, 1996.

Instant appeal was filed under Section 37 of the Arbitration and Conciliation Act, 1996 against the decision of Additional District Judge, whereby the application under Section 9 of the Act, 1996 filed by the appellants was dismissed on the ground that the appellants neither made out a prima facie case nor was the balance of convenience in their favour nor they would suffer any irreparable loss in the event of being denied injunction because the appellants were not “partners” in the light of the arbitration clause.

Question for Consideration:

Whether the appellants have a right to claim the said reliefs under Section 9 of the Act, 1996?

Analysis, Law and Decision

High Court expressed that a partnership business is run in accordance with the terms of the contract of partners.

Whether a retired partner has right to affect the business of the partnership?

The relation between the partners is quasi fiduciary and is expressed in the maxim in societatis contractibus fides exuberet. The relation of the partners is based on mutual confidence, and it is the duty of the partners to one another and carry on the business of the firm to the greatest common advantage, to be just and faithful to each other and to render true accounts and full information of all things affecting the firm to any partner or his legal representative. Therefore, a retired partner has no right to affect the business of the partnership.

Further, the Bench did not accept the appellant’s contention that the “Partnership Deed-Retirement cum Admission Deed” is a void document and the said void document causes harm to the appellants, therefore, the appellants wanted to refer the matter, as a party to the said Deed, to the arbitration and for the interim measure, the appellants had filed the application under Section 9 of the Act, 1996.

Court gave the reasoning for the above that on one hand the said Deed was being called void by the appellants and on the other hand Clause 22 of the same Deed was being relied upon by them.

In Clause 22 of the said Deed, there was no provision to the effect that the retiring partners can invoke the said provision for the purpose of arbitration and, secondly, Section 31 of the Specific Relief Act, 1963 provides that only “court” has jurisdiction to cancel any void or voidable document.

Section 9 of the Act

Adding to the above analysis Court expressed that Section 9 of the Act, 1996 enables the parties to arbitral proceedings to obtain interim relief from a Court.

Section 9 entitles ‘any party’ to obtain interim relief from the court at three stages i.e.

(i) before the commencement of arbitral proceedings,

(ii) during the course of the arbitral proceedings, and

(iii) after the arbitral award is made but prior to its enforcement.

Further, the Court added that Section 9 of the Act, 1996 was enacted with the intention of preserving and protecting the subject matter of the arbitral proceedings, hence for invoking the jurisdiction of the Court under Section 9 of the Act, 1996 the person should be a party to an arbitration agreement.

Therefore, a person not a party to arbitration agreement cannot invoke jurisdiction of the Court for interim relief under Section 9 of the Act, 1996.

In the matter at present appellants were not “Partners” under the “Partnership Deed-Retirement cum Admission Deed”.

Hence the appellants were not parties to the arbitration agreement to invoke the arbitration clause leading to no prima facie case.

In view of the above, present appeal was dismissed. [Mohd Yusuf v. Ashish Aggarwal, 2021 SCC OnLine Utt 1274, decided on 10-11-2021]


Advocates before the Court:

For the Appellants:

Mr Arvind Vashisth, Senior Advocate assisted by Mr Kartikey Hari Gupta, learned counsel.

For respondent 1:

Mr Rakesh Thapliyal, Senior Advocate assisted by Mr Rajat Mittal, learned counsel.

Case BriefsTribunals/Commissions/Regulatory Bodies

National Consumer Disputes Redressal Commission (NCDRC): Coram of Justice R.K. Agrawal (President) and Dr S.M. Kantikar (Member)reiterated that the presence of an arbitration clause in the agreement does not bar the jurisdiction of consumer fora.

Grievance of the Buyer

Complainants alleged that the Project in which they had booked their flat has not been completed till date even after about 8 years from the date of the booking. OP developer indulged in unfair trade practices by utilizing the money collected from the complainants, for its personal gains on benefits and further diverted the funds collected from the complainants to its other projects.

Complainants noting that the project has not even reached the 50% completion stage, clearly showed that the OP had no intention of developing/completing the project.

It was also alleged that even after 8 years, the construction of the project is not even close to completion, there are no laying of roads, utility supplies, access/service roads, facilities, clubs, no sign of rail over bridge etc. It was further alleged that the unexpected, unreasonable and inordinate delay in developing and constructing the project, and facilities and also the delay in handing over possession of the flat, clearly amounts to deficiency in services.

Builder’s Contention

OP contended that the present Complaint is not maintainable in light of Clause 33 of the Agreement executed between the Parties, according to which, all or any disputes arising out of or touching upon or in relation to the terms of the Agreement including its interpretation and validity and the respective rights and obligations of the parties have to be settled amicably by mutual discussion failing which the disputes have to be settled through arbitration. The Opposite Party has further submitted that Complainant 1 has no privity of contract with the Opposite Party and no relief can be granted to the said Buyer’s Association.

Analysis, Law and Decision

Coram while analysing the matter and noting the contention with respect to the arbitration clause relied on the Supreme Court decision of Emaar MGF Land Ltd. v. Aftab Singh – I, (2015) CPJ 5 (SC), in which it was laid down that an Arbitration clause on the agreement does not bar the jurisdiction of the Consumer Fora to entertain the complaint.

Hence, the objection raised by the Counsel for the OP that the clause of the Arbitration bars this commission from entertaining the complaint was unsustainable.

Counsel’s contention for the Developer that the Complainants are not ‘Consumers’ and that the subject Flats were booked for investment purpose was completely unsustainable in the light of the judgement of this Commission in Kavita Ahuja v. Shipra Estates I (2016) CPJ 31, in which the principle laid down is that the onus of establishing that the Complainants were dealing in real estate i.e. in the purchase and sale of plots/ flats in his normal course of business to earn profits, shifts to the OP Developer, which in the instant case the Opposite Party Developer had failed to discharge.

Further, as per Clause 4.5 of the Agreement of the Flat Buyer Agreement, in case of failure to deliver possession, the OP developer was liable to refund the amounts paid by the allottees with simple interest 10% pa for the period such amounts were laying with the Developer/SPV and to pay not other compensation whatsoever, whereas, in terms of Clause 1.19 in case of late payment, the Complainant/Buyer is liable to pay interest @18% p.a.

The above-stated terms depicted that they were wholly one-sided and unfair, therefore the complainant cannot be made bound to the terms of the agreement.

Elaborating further, Commission stated that it was not in dispute that the Complainants were allotted the Flats in the year 2009 and till date the construction of the flat has not been completed.

Coram opined that buyer cannot be made to wait indefinitely for the delivery of possession and the act of OP with regard to relying on Farmers’ agitation while retaining the amounts deposited by the complainants was not only an act of deficiency of service but also amounted to Unfair Trade Practice.

Direction

Complainants are entitled to refund of the principal amount with a reasonable interest of @9% p.a. from the date of the respective date of deposit till the date of actual refund. [Ansal API Megapolis Buyer’s Assn. v. Ansal Hi-Tech Townships Ltd., 2021 SCC OnLine NCDRC 330, decided on 8-11-2021]


Advocates before the Commission:

For the Complainants: Mr Saurabh Jain, Advocate

For the Opposite Party: Mr Rakesh Kumar, Advocate Mr Rupesh Kumar Sinha, Advocate

Case BriefsHigh Courts

Andhra Pradesh High Court: M. Satyanarayana Murthy, J., expressed that,

“If a party to the document wants to annul the document, he has to file a suit under Section 31 of the Specific Relief Act before the competent Civil Court and if, third party wants to annul the document, he has to approach the competent Civil Court and seek relief under Section 34 of the Specific Relief Act.”

Murthy and Sodemma were husband and wife with no children. Murthy was the absolute owner of agricultural land and a house, he had alienated his entire property to his wife during his lifetime.

Sodemma who was the maternal aunt of the petitioner, bequeathed the said property to him as he had taken care of their welfare at the old age. Therefore, petitioner became the absolute owner and possessor of the said property as per the registered Will deed executed by Sodemma.

Respondent 15, son of younger brother of Murthy with a mala fide intention to become the owner of Murthy’s property hatched a plan and fabricated an adoption deed to claim that Murthy and Sodemma adopted respondent 14 and got the signature of Murthy and Sodemma on the said fabricated deed by fraud and misrepresentation.

Later, in the year 2002, respondent 15 fabricated unregistered agreement of sale on the blank stamp papers signed by Murthy having believed him.

Respondent 14 filed for partition of the above-mentioned property by claiming that he is adopted son of Murthy and Sodemma.

Respondent 15 also filed for specific performance of unregistered sale agreement alleged to have been executed by Murthy after lapse of more than 17 years from the date of alleged execution of the said unregistered agreement. Murthy and Sodemma contested both the suits and denied the execution of both the fabricated adoption deed dated 24.05.1993 and alleged unregistered agreement of sale.

Further, it was submitted that during the pendency of both the said suits, respondent 17, the then Minister for Animal Husbandry alleged to have purchased the property, which is the subject matter of those two suits, and started construction of palatial building in the subject property and he by abusing his power as the Minister for Animal Husbandry made the authorities concerned to issue antedated permissions in contravention of Rules.

This Court had directed that there shall not be any construction on the subject property.

Crux of the Matter

Alleged playing of fraud on Sub-Registrar in mutating the name of respondents 14 and 15,  registration of property in the name of respondent 16 allegedly at the instance of respondent 17.

Petitioners claim was that when the decree was passed, appeal were pending against both the decrees and common judgment, execution of sale deed by respondents 14 and 15 in favour of respondent 16 allegedly at the instance of respondent 17 deviating the decree was serious illegality and it amounted to ‘fraud’.

Tahsildar, respondent 8 was not supposed to mutate the names of respondents 14 and 15 and only due to influence of respondent 17.

Petitioner claimed that the very mutation of the name of respondents 14 and 15 in the revenue record, now mutated the name of respondent 16 after completion of sale transaction, registered document was tainted by ‘fraud’.

Analysis, Law and decision

To constitute fraud, there must be a suggestion, as a fact, of that which is not true, by one who does not believe it to be true; the active concealment of a fact by one having knowledge or belief of the fact; a promise made without any intention of performing it; any other act fitted to deceive; any such act or omission as the law specially declares to be fraudulent. 

In the present matter, Court stated that,

In the absence of any interim direction, registration of a document when presented for registration satisfying the requirements under the Stamp Act and Registration Act is justified.

 Court added that Registrar is bound to register the document presented for registration unless there is prohibition from registration of such document pertaining to the land covered by Section 22A, 35 (3) and Section 71 of the Registration Act. But no such ground was raised in the present matter.

In Court’s opinion, execution of registered sale deed by respondent 14 and 15 in favour of respondent 16 by playing fraud was purely a mixed question of fact and law, such a question cannot be decided in writ petition while exercising power under Article 226 of the Constitution of India.

Supreme Court in Satya Pal Anand v. State of M.P., AIR 2016 SC 4995, held that “a party aggrieved by registration of a document is free to challenge its validity before a competent Civil Court.”

High Court held that while exercising jurisdiction under Article 226, this Court cannot annul document on the ground of ‘fraud’ and ‘misrepresentation’ since they are both mixed questions of fact and law, such roving enquiry cannot be conducted by the Constitutional Court to issue a writ of Mandamus as it is an extraordinary and discretionary relief.

When the documents are presented for registration before the Sub-Registrar, his duty is to register the same subject to any bar contained in any law and satisfying the requirements under the provisions of the Stamps and Registration laws. Such registration of document is nothing but discharging public duty.

Therefore, registration of document while discharging public duty by public officer cannot be said to be fraudulent act and such act will not attract the definition of fraud under Section 17 of the Indian Contract Act.

When can a document be cancelled?

It is settled law that the document can be cancelled only by filing suit before the Civil Court under Section 31 of the Specific Relief Act by a person, who is a party to the document.

If a third party intended to annul the document, he has to file a suit to declare the suit document as illegal and not binding on the plaintiff.

Due to lack of merits, no relief was granted and petition was dismissed.[Mangipudi Nagaraju v. State of Andhra Pradesh, 2021 SCC OnLine AP 3148, decided on 8-10-2021]

Case BriefsSupreme Court

Supreme Court: The bench of Hemant Gupta and V. Ramasubramanian, JJ has explained the scope of a “very strange provision” under Section 85A of the Maharashtra Tenancy and Agricultural Lands Act, 1948 and has held that

“Though Section 85(2) mandates that no order of the  Mamlatdar, the Tribunal, the Collector or the State Government passed under the Act shall be questioned in any Civil or Criminal Court, the bar contained therein stands diluted to some extent under Section 85-A.”

The Court said that such a provision is not found in many other statutes which contain provisions barring the jurisdiction of Civil Courts.

Relevant provisions

Section 85.  Bar of jurisdiction

(1)  No Civil Court shall have jurisdiction to settle, decide or deal with any question [(including a question, whether a person is or was at any time in the past a tenant and whether any such tenant is or should be deemed to have purchased from his landlord the land held by him)] which is by or under this Act required to be settled, decided or dealt with by the Mamlatdar or Tribunal, a Manager, the Collector or the [Maharashtra Revenue Tribunal] in appeal or revision or the [Maharashtra Revenue Tribunal] in appeal or revision or the [State] Government in exercise of their powers of control.

(2) No order of the Mamlatdar, the Tribunal, the Collector or the [Maharashtra Revenue Tribunal] or the [State] Government made under this Act shall be questioned in any Civil or Criminal Court.

Explanation–– For the purposes of this section a Civil Court shall include a Mamlatdar’s Court constituted under the Mamlatdar’s Courts Act, 1906.

Section 85A. Suits involving issues required to be decided under this Act

(1)  If any suit instituted in any Civil Court involves any issues which are required to be settled, decided or dealt with by any authority competent to settle, decide or deal with such issues under this Act (hereinafter referred to as the “competent authority”), the Civil Court shall stay the suit and refer such issues to such competent authority for determination.

(2) On receipt of such reference from the Civil Court, the competent authority shall deal with and decide such issues in accordance with the provisions of this Act and shall communicate its decision to the Civil   Court and such Court shall thereupon dispose of the suit in accordance with the procedure applicable thereto.

Explanation–– For the purpose of this section a Civil Court shall include a Mamlatdar’s Court constituted under the Mamlatdar’s Courts Act, 1906.

How does Section 85-A dilute the bar contained under Section 85?

The Court explained that Section 85A, inserted by Bombay Act 13 of 1956, prescribes a two-stage procedure for the Civil Court to follow, whenever a suit is instituted, despite the bar contained in Section 85.

  • In the first stage, the Civil Court should stay the suit and refer the issues to the competent authority under the Act for determination.
  • In the second stage, the Civil Court should dispose of the suit in accordance with the procedure applicable thereto, after receipt of the decision of the competent authority, to whom the issues were referred for a decision under the Act.

Hence, if the bar under Section 85(2) was absolute, the Civil Court would have no option except to dismiss the suit. If the bar of jurisdiction is absolute, the question of the Civil Court staying further proceedings in the suit, referring the issues for the adjudication of the competent authority under the Act and disposing of the suit after receipt of a decision from the competent authority, would not arise.

[Salim D. Agboatwala v. Shamalji Oddhavji Thakkar, 2021 SCC OnLine SC 735, decided on 17.09.2021]

_________________________________________________________________________________________

Counsels:

For appellants” Senior Advocate Kevic Setalvad

For Respondents: Senior Advocate Shekhar Naphade and advocate Aniruddha Joshi


*Judgment by: Justice V. Ramasubramanian

Know Thy Judge | Justice V. Ramasubramanian

Advani LawExperts Corner


Introduction


 

The Arbitration and Conciliation Act, 1996 (the A&C Act) is based on the 1985 UNCITRAL Model Law on International Commercial Arbitration, the enactment of the A&C Act signified the inception of the effort being made by the Indian legislature to bring India closer to the modern and pro-arbitral renaissance that was being spearheaded by the western world. Section 16 of the A&C Act embodies the sacrosanct doctrine of kompetenz-kompetenz which gives primacy to the Arbitral Tribunal to rule on its own jurisdiction including objections pertaining to the existence or validity of the arbitration agreement.

Although, Section 16 gives the express power to the Arbitral Tribunal to decide all issues pertaining to its own jurisdiction comprising an array of preliminary issues, it is silent as to what these preliminary issues include. The pertinent question that has warranted tremendous scholarly discourse by prominent practitioners in the global arbitral fraternity is whether the issue of limitation is one of jurisdiction or an adjudication on merits of the claim and whether this decision could be made by the Arbitral Tribunal under Section 16 of the A&C Act.

 

The present article will analyse two recent decisions of the Supreme Court of India where the Court has delivered conflicting opinions as to whether limitation constitutes a jurisdictional issue. The authors will conclude by suggesting a way forward until the controversy is conclusively settled by the judgment of a larger Bench of the Supreme Court.

 


The Controversy


The pertinent question of whether the decision of an Arbitral Tribunal on whether the claim of the claimant is barred under the law of limitation is an interim order or an interim award came up before the Division Bench of the Supreme Court comprising Nariman and Sinha, JJ. in Indian Farmers Fertilizer Coop. Ltd. v. Bhadra Products[1] (Indian Farmers). The Court was confronted with a case where the respondent had invoked arbitration and the Tribunal considered it appropriate to decide whether the claimant’s claim was barred by the law of limitation at first as a preliminary issue before traversing into the merits of the dispute. The arbitrator held that the claimant’s claim was not barred by the law of limitation. Aggrieved by the aforesaid interim decision of the arbitrator, the petitioner preferred an application filed under Section 34 of the A&C Act before the trial court styling it as the “first partial award”. The trial Judge held that the arbitrator’s decision did not constitute an award and dismissed the petition. Aggrieved by this judgment, the petitioner preferred an appeal to the High Court of Orissa wherein the High Court concurred with the findings of the trial court thereby dismissing the appeal proceedings. When the matter reached the Supreme Court, the Court at the outset had to decide whether the petition filed under Section 34 was maintainable. The Court realised that this could be determined by ascertaining whether the decision of the arbitrator on the issue of limitation constituted an interim award under Section 2(1)(c) r/w Section 31(6) and therefore assailable before the Court under Section 34 or whether the issue of limitation was one of jurisdiction and fell within the ambit of Sections 16(2) and (3) and therefore assailable before the Court only under the recourse envisaged under Section 37(2)(a) of the A&C Act. In the light of the aforesaid conundrum, the Court in Indian Farmers[2] framed the following issues:

 

(i) Whether an award on the issue of limitation can first be said to be an interim award?

(ii) Whether a decision on a point of limitation would go to jurisdiction and therefore be covered by Section 16?

 

The Court in Indian Farmers[3] began its reasoning with a conjoint reading of Sections 2(1)(c) and 31(6) observing that an arbitral award includes an interim award while noting that the A&C Act does not define an interim award. The Court was then constrained to rely on the wordings of Section 31(6) wherein it observed that the legislature had given the express power to the Arbitral Tribunal to make an interim award with respect to any matter on which it may make a final arbitral award. The Court relied on Section 32(1) to hold that there can be more than one interim award prior to the final award which could conclusively determine some issues between the parties.

 

The Court in Indian Farmers[4] relied on the wordings embodied in Section 47 of the English Arbitration Act, 1996 (English Arbitration Act) as it throws some light on what constitutes an interim award under English law. Relying on Section 47 of the English Arbitration Act, it was observed that a preliminary issue that affected the whole claim would expressly be the subject-matter of an interim award under the English Arbitration Act. It is pertinent to note that the Court stressed on the fact that the English Arbitration Act advisedly does not use the expression interim or partial so as to make it clear that the award covered by Section 47 of the English Arbitration Act would be a final determination of the particular issue arising from the dispute between the parties.

 

The Court in Indian Farmers[5] in order to augment its ratio went on to rely on an earlier decision of the Supreme Court that laid emphasis on what characteristics were required to constitute an interim award under the Indian arbitral regime. The Court relied on the decision in Satwant Singh Sodhi v. State of Punjab[6] (Satwant Singh) wherein an interim award in respect of one particular item was made by the arbitrator and the Court was confronted with whether such an award could be made a rule of the court. In Satwant Singh[7] it was held that an interim award which finally determines the rights of the parties with respect a certain claim and one which could not be readjudicated again could validly be made a rule of the court. Applying the dictum in Satwant Singh[8], the Court in Indian Farmers[9] held that as the issue of limitation was a final determination with respect to a part of the claim and was one which could not be readjudicated again it therefore validly constituted an interim award under Section 31(6) of the A&C Act. The Court in Indian Farmers[10] also relied on the dictum of the Supreme Court in the famous case of McDermott International Inc. v. Burn Standard Co. Ltd.[11] (McDermott International) wherein the Court has held that a partial award or an interim award is a final award on matters covered therein made at an intermediate stage of the arbitral proceedings. Relying on the above authorities, the Court in Indian Farmers[12] has held that a final decision of the arbitrator on the issue of limitation is an interim award within meaning of Section 2(1)(c) r/w with Section 31(6) and by virtue of being an award, it was capable of being challenged under Section 34 of the A&C Act.

 

Moving on to the second issue, as to whether the issue of limitation would fall within the ambit of Section 16 warranted a lengthy consideration by the Court. While answering this question in the negative, the Court after discussing the rationale of the doctrine of kompetenz-kompetenz relied on the corresponding provisions in Sections 30 and 31 of the English Arbitration Act. After carefully examining the wordings of the said provisions, it held that the doctrine of kompetenz-kompetenz connoted that the term “jurisdiction” under Section 16 only encompassed reference to three particular determinations:

(i) As to whether there is the existence of a valid arbitration agreement.

(ii) Whether the Arbitral Tribunal is properly constituted.

(iii) Matters submitted to arbitration should be in accordance with the arbitration agreement.

To further inquire whether limitation converged with jurisdiction, the Court relied on the decision of the Constitution Bench in Ittyavira Mathai v. Varkey Varkey[13] (Varkey Varkey) where the Constitution Bench interpreted the connotation jurisdiction wherein it laid down that a court has jurisdiction over the subject-matter pertaining to the case and the parties. It further held that it is true that courts are bound to rule while correctly applying the law, it is true that courts have been susceptible to making errors. The Court in Varkey Varkey[14] concluded that in spite of the fact that a court might have erred in coming to its conclusion it does not tantamount that the court has acted outside its jurisdiction.

 

More importantly, the Court in Indian Farmers[15] vehemently concurred with the findings of the Supreme Court in NTPC Ltd. v. Siemens Atkeingesellchaft[16] (NTPC) wherein it was held that when no question of jurisdiction has been addressed by the arbitrator in its findings, a party cannot disguise it to be one of jurisdiction falling within the ambit of Sections 16(2) and (3) so as to enable it to file an appeal under the recourse contemplated by Section 37(2). The Court in NTPC[17] observed that the appropriate recourse is for the aggrieved to prefer an application under Section 34 against the partial award and thereafter it could prefer an appeal under Section 37. Supplementing the opinion of the Court delivered at first by Mathur, J. in NTPC[18], Balasubramanyan, J. when discussing the ambit of jurisdiction under Section 16 laid down that when an Arbitral Tribunal finds that the claim was not maintainable for other valid reasons or that the claim was barred by the law of limitation it tantamounted to an adjudication by the Arbitral Tribunal on the merits of the claim and therefore would be assailable under Section 34 of the A&C Act.

 

Ultimately, the Court in Indian Farmers[19] relying on the above authorities held that the award passed by the arbitrator was an interim award, which being an arbitral award could be challenged by preferring an application under Section 34 and not Section 37. The Court held that the issue of limitation does not fall within the ambit of the Arbitral Tribunal’s jurisdiction under Section 16 and therefore the drill of Sections 16(5) and (6) need not be followed.

 

At this juncture it is important to study the controversy that has arisen in contemporary arbitral jurisprudence with regard to whether the issue of limitation falls within the Arbitral Tribunal’s power to rule on its own jurisdiction. A Coordinate Bench of the Supreme Court comprising Malhotra and Rastogi, JJ. in Uttarakhand Purv Sainik Kalyan Nigam Ltd. v. Northern Coal Field Ltd.[20] (Uttarakhand Purv Sainik) had to consider the ambit and scope of the newly inserted Section 11(6-A) in the light of the 2015 Amendment of the A&C Act. The Court in Uttarakhand Purv Sainik[21] observed that insertion of Section 11(6-A) marked a significant departure from the opinion of the 7-Judge Constitution Bench in SBP & Co. v. Patel Engg. Ltd.[22] (SBP & Co.) where many threshold issues could be decided by the Court. The Court observed that in view of the non obstante clause in Section 11(6-A), the decision in SBP & Co.[23] stood legislatively overruled on that point. Moreover, the Court in Uttarakhand Purv Sainik[24] laid down its opinion on the scope and ambit of Section 16 as to what constitutes an issue of jurisdiction wherein it relied on the decision in ITW Signode (India) Ltd. v. CCE[25] (ITW Signode). In ITW Signode[26] a Bench of three Judges held that the issue of whether a claim was time barred under law of limitation is a jurisdictional issue.

 

It is interesting to note what the Court in Uttarakhand Purv Sainik[27] has discerned from the dictums in Indian Farmers[28] and NTPC[29], as the Court relied on the same in coming to the conclusion that the issue of limitation is one of jurisdiction and falls within the ambit of the doctrine of kompetenz-kompetenz under Section 16. It is needless to say that Court has wrongly imported and applied the dictums in Indian Farmers[30] and NTPC[31] to the question that had arisen before it under Section 11(6-A) and has arrived at such an anomalous outcome.

 

Adding to the controversy, in a recent judgment of the Bombay High Court in C. Shamsuddin v. Now Realty Ventures LLP[32] (C. Shamsuddin), G.S. Patel, J. was confronted with opining on the scope of jurisdiction of the Court at the pre-reference stage in an application filed under Section 11. The Bombay High Court in C. Shamsuddin[33] considered the interplay between Sections 11 and 16 and while relying on the decisions of the Supreme Court in Indian Farmers[34] and Uttarakhand Purv Sainik[35] held that the issue of limitation should be decided by the Arbitral Tribunal under Section 16. It is our opinion that the Court in C. Shamsuddin[36] appears to have been left astray by following the ruling in Uttarakhand Purv Sainik[37] which erred in applying the decision in Indian Farmers[38].


Conclusion


It is evident that the decisions in Uttarakhand Purv Sainik[39] and C. Shamsuddin[40] suffer from the infirmity of incorrectly construing and applying the decision in Indian Farmers[41]. It is our opinion that the decision in Indian Farmers[42] was cogent, succinct and in consonance with contemporary pro-arbitral jurisprudence. It is also without doubt that the clarity brought about by the decision in Indian Farmers[43] was long awaited by the arbitral fraternity. The decision also gave sufficient clarity to litigants that the appropriate remedy is to file an application under Section 34 before the appropriate court in the event that one of them is aggrieved by the decision of the arbitrator on the issue of limitation. It is our opinion that the laudable effort of Nariman, J. in Indian Farmers[44] to settle ambiguity has been obscured by the ruling in Uttarakhand Purv Sainik[45] and has left the scope and ambit of the doctrine of kompetenz-kompetenz in dubiety. It is in our opinion that the present conundrum warrants cognizance by a larger Bench of the Supreme Court at the earliest possible opportunity, in order to prevent another series of conflicting judgments and also to bring about consonance between decisions of the leading High Courts.

 

It is a settled canon of law in India that where there are conflicting decisions of concurrent Benches of the Supreme Court, it is for the subordinate courts to follow the judgments which appears to have laid down the law more emphatically and accurately in the correct scenario having regard to the issue being dealt with by the court together with proper consideration of the factual matrix. In light of the above, it is our opinion that the decision in Indian Farmers[46] appears to have accurately and with adequate reasoning answered the questions with respect to the issues framed and is in the context of Section 16 rather than the decision in Uttarakhand Purv Sainik[47] that appears to have wrongly imported the decision in Indian Farmers[48] to the context of Section 11.

 

The decision in Uttarakhand Purv Sainik[49] has evidently obscured the essence of the underlying rationale in Indian Farmers[50] whilst erring by disregarding the nuanced difference between limitation and jurisdiction. It is our opinion that decision in Indian Farmers[51] correctly distinguished limitation as being a defect pertaining to the claim or right of a party to approach the court for reliefs whereas jurisdiction is a defect pertaining the power of the adjudicating authority to take cognizance of a claim based on other statutory considerations. Therefore, we suggest that the decision in Indian Farmers[52] be considered as the correct position of law in this regard. It is also recommended that the High Courts follow the decision in Indian Farmers[53] rather than Uttarakhand Purv Sainik[54] in order to prevent another series of conflicting decisions and to provide certainty to the arbitral fraternity thereby fostering the landscape for arbitration in India.

 


† Hiroo Advani, Senior Managing Partner at Advani & Co.

†† Manav Nagpal, Associate at Advani & Co.

[1] (2018) 2 SCC 534.

[2] (2018) 2 SCC 534.

[3] (2018) 2 SCC 534.

[4] (2018) 2 SCC 534.

[5] (2018) 2 SCC 534.

[6] (1999) 3 SCC 487.

[7] (1999) 3 SCC 487.

[8] (1999) 3 SCC 487.

[9] (2018) 2 SCC 534.

[10] (2018) 2 SCC 534.

[11] (2006) 11 SCC 181.

[12] (2018) 2 SCC 534.

[13] (1964) 1 SCR 495 : AIR 1964 SC 907.

[14] (1964) 1 SCR 495 : AIR 1964 SC 907.

[15] (2018) 2 SCC 534.

[16] (2007) 4 SCC 451.

[17] (2007) 4 SCC 451.

[18] (2007) 4 SCC 451.

[19] (2018) 2 SCC 534.

[20] (2020) 2 SCC 455.

[21] (2020) 2 SCC 455.

[22] (2005) 8 SCC 618.

[23] (2005) 8 SCC 618.

[24] (2020) 2 SCC 455.

[25] (2004) 3 SCC 48.

[26] (2004) 3 SCC 48.

[27] (2020) 2 SCC 455.

[28] (2018) 2 SCC 534.

[29] (2007) 4 SCC 451.

[30] (2018) 2 SCC 534.

[31] (2007) 4 SCC 451.

[32] 2020 SCC OnLine Bom 100 : (2020) 6 Mah LJ 108.

[33] 2020 SCC OnLine Bom 100 : (2020) 6 Mah LJ 108.

[34] (2018) 2 SCC 534.

[35] (2020) 2 SCC 455.

[36] 2020 SCC OnLine Bom 100 : (2020) 6 Mah LJ 108.

[37] (2020) 2 SCC 455.

[38] (2018) 2 SCC 534.

[39] (2020) 2 SCC 455.

[40] 2020 SCC OnLine Bom 100 : (2020) 6 Mah LJ 108.

[41] (2018) 2 SCC 534.

[42] (2018) 2 SCC 534.

[43] (2018) 2 SCC 534.

[44] (2018) 2 SCC 534.

[45] (2020) 2 SCC 455.

[46] (2018) 2 SCC 534.

[47] (2020) 2 SCC 455.

[48] (2018) 2 SCC 534.

[49] (2020) 2 SCC 455.

[50] (2018) 2 SCC 534.

[51] (2018) 2 SCC 534.

[52] (2018) 2 SCC 534.

[53] (2018) 2 SCC 534.

[54] (2020) 2 SCC 455.

Case BriefsSupreme Court

Supreme Court: The Division Bench comprising of Dhananjaya Y Chandrachud* and B. V. Nagarathna, JJ., had set aside the impugned interim order of Madras High Court holding it to be an attempt to re-write Rule 29(4) of the Copyright Rules 2013. The Bench remarked,

“The interim order converts the second proviso into a “routine procedure” instead of an exception (as the High Court has described its direction). This exercise by the High Court amounts to re-writing. Such an exercise of judicial redrafting of legislation or delegated legislation cannot be carried out.”

A few broadcasters had approached the Madras High Court to challenge the validity of Rule 29(4) of the Copyright Rules 2013 on the ground that it (i) violates Article 19(1)(a) of the Constitution; and (ii) is ultra vires Section 31D of the Act. The High Court, by its interim order had held that the duty which is cast on broadcasters in the notice to broadcast under Rule 29(1) is “apparently onerous”. Consequently, it directed that the petitioners before it may be permitted to resort to the second proviso to Rule 29(4) as a “routine procedure”, instead of an exception, subject to the duration of the ex post facto reporting being enlarged to fifteen days.

It was in the above backdrop that the instant appeal was initiated in the Supreme Court on the ground that the impugned interim order had the effect of re-writing Rule 29(4) of the Rules framed in pursuance of the provisions of Section 31D and Section 78(2)(cD) of the Copyright Act 1957.

Statutory Mandate

By the Copyright Amendment Act 2012, Parliament incorporated the provisions of Section 31D. Under sub-section (1) of Section 31D, a broadcasting organization which is desirous of communicating to the public by way of a broadcast or performance of a literary or musical work and sound recording which has already been published, may do so subject to compliance with the provisions of Section 31D. Section 31D(2) incorporates five requirements, namely:

  • a prior notice;
  • in the manner prescribed;
  • of the intention to broadcast the work;
  • stating the duration and territorial coverage of the broadcast; and
  • payment to the owner of rights in each work royalties in the manner and at the rate fixed by the Appellate Board.

Rule 29. Notice to owner for communication to the public of literary and musical works and sound recordings.—“(1) Any broadcasting organisation desirous of communicating to the public by way of broadcast or by way of performance of a published literary or musical work and sound recording under sub-section (1) of Section 31-D shall give a notice of its intention to the owner of the copyright and to the Registrar of Copyrights before a period of five days in advance of such communication to the public and shall pay to the owner of the copyright, in the literary or musical work or sound recording or any combination thereof, the amount of royalties due at the rate fixed by the Board in this regard:

Provided further that in case of communication to the public by way of broadcast or by way of performance of any published literary or musical work and sound recording or any combination thereof, in unforeseen circumstances, the notice shall, be given within twenty-four hours of such communication to the public:”

Contentions Raised

The appellants had challenged the interim order on the following grounds:

  1. By the interim order, the High Court re-wrote Rule 29(4), which is impermissible, in any event at the interim stage;
  2. The validity of Rule 29(4) was yet to be adjudicated upon and a presumption would attach to the constitutionality of both – the Rules and the Statute;
  3. There was no challenge to the validity of Section 31D in terms of which Rule 29 had been framed;
  4. The High Court had, in the course of its interim order, extended it only to the petitioners before it and to the broadcasters who had been impleaded as parties, as a result of which the pan-India operation of the Rule was left in the realm of uncertainty.

Observation and Analysis

Observing that the High Court had substituted the provisions of Rule 29(4) with a regime of its own, which was made applicable to the broadcasters and the petitioners before it, the Bench referred to the decision of the Constitution Bench in In Re: Expeditious Trial of Cases Under Section 13 138 of NI Act 188, wherein the Court had emphasized that, “the judiciary cannot transgress into the domain of policy making by re-writing a statute, however strong the temptations maybe.”

Reiterating that the court in the exercise of judicial review cannot supplant the terms of the provision through judicial interpretation by re-writing statutory language, the Bench expressed,

“Draftsmanship is a function entrusted to the legislature. Craftsmanship on the judicial side cannot transgress into the legislative domain by re-writing the words of a statute. For then, the judicial craft enters the forbidden domain of a legislative draft.”

Therefore, the Bench held that the High Court had entered the forbidden domain of legislative draft as it had held the broadcasters down to the requirement of prior notice, it had even modified the operation of Rule 29 by stipulating that the particulars which were to be furnished in the notice may be furnished within a period of fifteen days after the broadcast.

Hence, the Bench was of the view that an exercise of judicial re-drafting of Rule 29(4) was unwarranted, particularly at the interlocutory stage proceedings. The High Court was also of the view that the second proviso may be resorted to as a matter of routine, instead of as an exception and that the ex post facto reporting should be enlarged to a period of fifteen days (instead of a period of twenty four hours). Holding such exercise impermissible, the Bench expressed caution that it would substitute a statutory rule made in exercise of the power of delegated legislation with a new regime and provision which the High Court considers more practicable.

Accordingly, the appeals were allowed and the impugned interim order was set aside.

[Saregama India Ltd. v. Next Radio Ltd., 2021 SCC OnLine SC 817, decided on 27-09-2021]

____________________________________________________________________________________________

Report by: Kamini Sharma, Editorial Assistant, EBC Publishing Pvt. Ltd. 

____________________________________________________________________________________________

Counsels:

For the Appellants: Sr. Advocate Mukul Rohatgi and Sr. Advocate Akhil Sibal,

For the Respondents: Sr. Advocate Navroz Seervai and Sr. Advocate Neeraj Kishan Kaul


*Judgment by: Justice Dr. Dhananjaya Y Chandrachud

Know Thy Judge| Justice Dr. DY Chandrachud

Case BriefsHigh Courts

Bombay High Court: Reiterating the well-settled position that, contractual employees are not the employees of the principal employer, N.B. Suryawanshi, J., held that,

Contractual employees are engaged through contractors, their service conditions are governed by the contracts between them, hence in case of any grievance, they shall approach the contractor and not a principal employer.

Two Primary Questions:

  • Whether a complaint of contractual employees seeking to exercise their rights, as provided under the Maharashtra Industrial Relations Act, 1946 and Bombay Industrial Relations Rules, 1947, is maintainable under the Maharashtra Recognition of Trade Unions and Prevention of Unfair Labour Practices Act, 1971?
  • Whether contractual employees can file a complaint under the Maharashtra Recognition of Trade Unions and Prevention of Unfair Labour Practices Act, 1971 for challenging the impugned order, which is not passed by the Principal Employer?

Factual Matrix

Petitioner-Original Respondent Company had 806 permanent employees working. Petitioner outsourced its peripheral activities to several contractors and for that purpose registered itself as the principal employer under Section 7 of the Contract Labour (Regulation and Abolition) Act, 1970.

Contracts of the petitioner have obtained license under Section 13 of the Act of 1970, there was no registered Trade Union in the local area of the petitioner establishment.

Respondent 16 – Government Labour Officer declared the election programme for conducting elections under Section 28 of the MR Act, for electing 5 representatives of the employees. 301 contractual workers submitted a representation stating to add their names to the voter’s list and to give them a right to vote.

For the above-stated representation, Management informed the contractual workers that the decision in the said regard cannot be taken by the Management and they may approach the Government Labour Officer or the Labour Commissioner. Some contractual workers submitted their representation to the Labour Commissioner seeking inclusion of their names to which the Commissioner rejected while citing the decision in Sunflag Iron & Steel Co. Ltd. v. State of Maharashtra, 2008 III CLR 983 contractual workers are not directly employed by the principal employer, and therefore, their names cannot be included in the voter’s list.

Respondents approached the Industrial Court and stated that the Labour Commissioner has committed unfair labour practice within the meaning of Item 9 o Schedule IV of the Maharashtra Recognition of Trade Unions and Prevention of Unfair Labour Practices Act, 1971.

Petitioner opposed the complaint stating the there was no employer and employee relationship between the complainants and the petitioner.

Industrial Court rejected the application but prima facie held that complaint is maintainable and it has jurisdiction to entertain it.

Petitioner submitted that Industrial Court has no power of superintendence over respondent 2 and therefore, the complaint is not maintainable and the same is liable to be rejected summarily.

Analysis, Law and Decision

Settled Legal Position

Contractual Employees are not employees of the principal employer.

In the decision of Supreme Court, Vividh Kamgar Sabha v. Kalyani Steel Ltd., (2001) 2 SCC 381, it was held that “the provisions of MRTU and PULP Act can only be enforced by persons who admittedly are workmen. If there is dispute as to whether the employees are employees of the Company, then that dispute must be first be gotten resolved by raising a dispute before the appropriate forum. It is only after the status as a workmen is established in an appropriate Forum that a complaint could be made under the provisions of MRTU and PULP Act”

In Central Labour Union (Red Flag) Bombay v. Ahemdabad Mfg. and Calico Printing Co. Ltd., 1995 Supp (1) SCC 175, the Supreme Court held that “where the workmen have not been accepted by the Company to be its employees, then no complaint would lie under the MRTU and PULP Act.”

High Court opined that for a complaint to be maintainable under the MRTU and PULP Act, admitted employer and employee relationship is a pre-condition. The provisions of the MRTP and PULP Act can be enforced only after the status of a workman is established before an appropriate forum.

In the present scenario, the contractual employees are the employees of the contractor and not of the petitioner. Hence they are not entitled to file a complaint against the petitioner claiming commission of unfair labour practice.

Therefore, the complaint filed under MRTU and PULP Act by the respondents/contractual employees, is not maintainable.

Under MIR Act, jurisdiction is conferred with the Labour Court and the Industrial Court are conferred with the power to decide the disputes on reference. For enforcing the rights under the MIR Act, forum is provided.

Bench opined that for enforcing the rights available under the MIR Act, a complaint cannot be filed under the MRTU and PULP Act.

Contractual employees are engaged through contractors, their service conditions are governed by the contracts between them. The appointment orders to the contractual employees are not given by the principal employer, but are given by the contractor. They work with the principal employer through contractor, only during the contract period. After the contract period is over, their contractor may enter into a contract with another establishment and shift them to work there. From that view of the matter also, they cannot be treated like permanent employees of the principal employer, and therefore, they cannot claim voting rights at par with the permanent employees.

Since the contractual employees are governed by the contract between contractors, their service conditions, wages, etc. are also governed by the same, hence in case of any grievance they shall approach the contractor and not the principal employer.

Misread and Misconstrued

Industrial Court had ignored the settled legal position that the complaint of unfair labour practice was maintainable only if there was admitted employer and employee relationship between the parties. The contractual employee, being the employee of the contractor and not of the principal employer, cannot file a complaint under the MRTU and PULP Act.

Therefore, Industrial Court’s decision was unsustainable.

While allowing the petition, Court concluded stating that complaint filed under the MRTU and PULP Act by the contractual employees for exercising their rights under the MIR Act is not maintainable and the Industrial Court has no jurisdiction to entertain it. [Mahindra and Mahindra Ltd v. Satish, 2021 SCC OnLine Bom 3003, decided on 20-09-2021]


Advocates before the Court

Shri. R. B. Puranik, Advocate for the Petitioner

Shri. S. B. Dhande, Advocate for the Respondent Nos.2 to 11 and 13 to 15

Ms. T. H. Khan, Asst. G. P. for the Respondent Nos. 16 to 17.

Case BriefsTribunals/Commissions/Regulatory Bodies

Delhi State Consumer Disputes Redressal Commission (DSCDRC): Coram of Dr Justice Sangita Dhingra Sehgal (President) and Anil Srivastava (Member)ordered the builder to refund the money deposited by the complainant, as a consequence of not being able to deliver the possession of flat on time. However, it was held that the builder was not liable to refund the EMI amount paid by the complainant towards loan sanctioned in favour of the complainant.

 Present consumer complaint was filed under Section 17 of the Consumer Protection Act, 1986 against OP 1 and OP 2.

Complainant had applied for booking of a flat in the OP 1’s project and was allotted a flat for the total sale consideration which was agreed at Rs 44,99,387.

Complainant and OP 1 entered into a Flat Buyers Agreement. It was stated in the agreement that the possession of the flat was to be delivered within 18 months from execution of the agreement along with a grace period of 6 months. Though, OP 1 failed to adhere to the stipulated time for delivery of possession and hence the complainant had to withdraw from the project.

Further, OP 1 informed the complainant regarding the deduction. Adding to this, it was submitted that the service tax paid on the entire transaction would also be forfeited.

Complainant got served a legal notice dated 03-10-2015, upon the OP 1 and sought refund of the amount deducted along with compensation for mental agony and harassment.

Alleging deficiency of service and unfair trade practice on the part of OP 1, the complainant approached this commission.

Analysis, Law and Decision

Territorial and Pecuniary Jurisdiction

Whether this commission has the jurisdiction to adjudicate the present complaint?

Coram on perusal of Section 17 of the Consumer Protection Act lead the Commission to the conclusion that it shall have the pecuniary jurisdiction in cases where the total claim including the compensation is more than twenty lakhs and less than One Crore. Moreover, clause 17(2) of the Act provides the extent of territorial jurisdiction, wherein it has been provided that the state commission shall have the jurisdiction to entertain cases where OP 1 at the time of the institution of the complaint, actually and voluntarily resides or carries on business or has a branch office or personally works for gain or the cause of action arose.

Hence, the commission has pecuniary jurisdiction in the present matter.

To strengthen the above finding, Coram relied on the Rohit Srivastava v. Paramount Villas (P) Ltd., 2017 SCC OnLine NCDRC 1198.

Further, the Coram stated that relying on the above case, this Commission has both territorial and pecuniary jurisdiction.

Deficiency of Service 

The stated expression of Deficiency of Service was dealt with by the Supreme Court in Arifur Rahman Khan v. DLF Southern Homes (P) Ltd., (2020) 16 SCC 512.

In Commission’s opinion, OP 1 was deficient in providing its services to the complainant since it had failed to handover the possession of the flat within the stipulated time period and the complainant was entitled to the refund of the money deposited to OP1.

OP 1’s deduction was not justified as the complainant had sought cancellation of the booking of the flat on account of deficient services provided by OP 1, hence the complainant was entitled to refund of the amount forfeited.

However, the Complainant was not entitled to receive an amount of Rs 6,33,289/- since this amount was paid as EMIs towards the loan sanctioned in favour of the Complainant. The OP 1 has no obligation to pay the EMI amount, since there exists no express agreement pertaining to the payment of EMIs to be done by the OP 1. [Kapila Narula v. Logix City Developers (P) Ltd., Complaint No. 149 of 2016, decided on 16-08-2021]


Advocates before the Court:

Ms. Suchita Sharma, Counsel for the Complainant.

Ms. Arushi Pathak, Counsel for the Opposite Party.