Hot Off The PressNews

Delhi High Court issues guidelines/directions to be followed upon resumption of Physical Court from 15-03-2021.

Following guidelines/directions need to be followed with effect from 15-03-2021:­

(a) All the gates including the entry and exit gates of underground car parking shall be opened and operated as it was being done pre-pandemic period;

(b) Declaration form as required till now from the Lawyers and Litigants dispensed with;

(c) Facilitation Counter/Pass Counter will function as it was pre-pandemic period;

(d) Entry of Litigants will be regulated, as it was pre-pandemic period; and

(e) All the visitors including Lawyers shall maintain social distancing as per norms/protocol issued by the Government of India/GNCTD and/or this Court.


Delhi High Court

[Public Notice dt. 02-03-2021]

Case BriefsHigh Courts

Calcutta High Court: Sabyasachi Bhattacharyya, J., dismissed a writ petition which, inter alia, sought to challenge the shifting of Sheoraphuli Market following the containment strategy of spreading COVID-19.

Petitioner 1 namely Sheoraphuli Kancha Sabzee Basayee Samity is a registered society whose members had been running a wholesale business of vegetables situated for quite a long time.

Petitioner 2 is the secretary of petitioner 1 – Society.

Respondent 5 vide a memo intimated the Assistant Commission of Police that as per the direction of the competent authority, the Sheoraphuli market would be shifted to Sheoraphuli Regulated Market, following containment strategy of spreading COVID-19.

Further, by another Memo, respondent 5 requested the Secretary, Hooghly Zilla R.M.C to take necessary action for the facilitation of the trader concerned/commission agents regarding clearing of due taxes as per existing law in force, regarding renewal of R.M.C licence operation of the Sheoraphuli ‘Haat’ (market).

The above-stated memoranda have been challenged in the instant petition.

Analysis, Law and Decision

Bench noted that vide Gazette Notification No. 1366-AM/P/5A-17/2013 dated October 17, 2014, the entire market area under the Sheoraphuli Regulated Market Committee (including the site of the Sheoraphuli ‘Hat’) ceased to be a market area and the Market Committee stood dissolved, thus denuding the business, run by the members of the petitioner 1 at the said location, of legal sanction under the West Bengal Agricultural Produce Marketing (Regulation) Act, 1972.

Since the whole Hooghly District had been declared vide a notification to be a market area, there was no legal bar for the authorities concerned to re-locate the Sheoraphuli ‘Hat’ to some other area after it ceased to be a market area. But when the said notifications was read in conjunction with the above notification it excluded the Sheoraphuli market and certain other specific locations from the designated ‘market area’.

Even from the materials on record, it could be seen that a new location is far superior to the previous site.

Further, the Bench observed that the act of purchasing plots of land in the Sheoraphuli area and investing therein by some individual vendors does not ipso facto validate the running of the wholesale vegetable business from there.

As per the scheme of the 1972 Act, “market” includes private market yards, thus subjecting such yards to the provisions of the Act as well. Hence, to trade in wholesale agricultural produce, vendors of private markets must also hold licences under Section 13 of the 1972 Act.

In the present case, members of petitioner 1 had been carrying on wholesale business in agricultural produce, thus coming with the purview of the 1972 Act.

In the decision of Prabhat v. Barkatulla University it was clearly laid down that, unless the members of the suing association are clearly determinate and identifiable, the result of the litigation does not bind all members of the association. The said decision has much persuasive value in the present matter.

Bench held that in the present case, petitioners have no locus standi to represent the interest of other traders/agents, who are not the members of petitioner 1 but still hold, or are eligible to get, valid licenses to carry on such business at the new location of the market.

Hence, the petitioners cannot be said to represent the interest of the entire trading community which is eligible to run business at the shifted site of the market.

With regard to the renewal of licence, the right of such renewal is subject to compliance with Section 13 (4) of the 1972 Act. Such renewal is not a blanket right but circumscribed by discretion of the respondent- authorities, to be exercised in accordance with law.

Lastly, Bench directed the respondents shall, however, ensure that the pending applications for renewal of licence under Section 13(4) of the West Bengal Agricultural Produce Marketing (Regulation) Act, 1972, if any, made by the members of the petitioner 1-society, are decided in accordance with law as expeditiously as possible. [Sheoraphuli Kancha Sabzee Babsayee Samity v. State of W.B., 2021 SCC OnLine Cal 420, decided on 19-02-2021]

COVID 19

Due to the outbreak of COVID-19, various countries introduced a package of social and labour market measures to support workers and their families. This brief discusses the paid sick leave introduced by various countries.

Country

Name of the Law Description

Comments

United Kingdom Statutory Sick Pay (SSP) Employees are entitled to SSP for upto 28 weeks and SSP is 95.85 pounds per week and workers earning less than £120 per week do not receive anything. Lowest mandatory sick pay for COVID-19 sufferers amongst OECD countries.
Australia[1] Fair Work Act An Employee has to provide reasonable evidence of sickness/ unexpected emergency for the sick leave, to the employer. Following leaves are available during covid-19:

(i) JobKeeper scheme – Subsidy for businesses affected due to Covid-19. Scheme is valid till 29th March, 2021.

(ii) Annual leave- Employees can take annual leave at half pay to manage the impact of Covid-19.

(iii) Sick and carer’s leave- Employees can avail paid sick/ carer’s leave, if available, else unpaid leaves. Government has introduced financial support if employee is unable to work.

(iv) Other paid leave- An employee gets long service leave after working for the same employer for a long time. All employees (other than casuals) are entitled to 2 days of paid compassionate leave per occasion. An employer can give extra paid leave to their employees if they choose to.

(v) Unpaid leave- some employees can avail 2 weeks unpaid pandemic leave, if they are employed under an affected award.

  Pandemic Leave Disaster Payment

(Federal)

The payment is available to workers in all six states, who:

(i) don’t have paid sick leave and can’t earn an income because they have to self-isolate or quarantine due to a positive coronavirus case; or

(ii) are caring for someone with coronavirus.

Singapore[2] Employment Act

 

5-day paid sick leaves are granted to the employees who have Covid-19 symptoms and could be extended by the employer.

 

  Work Injury Compensation Act (WICA) Employees are covered under WICA wherever they work, including from home. It covers employees affected by Covid-19, if arising from and in the course of work.
UAE MINISTERIAL DECREE NO. (279) OF 2020[3] Employer and Non-National Worker – by agreement with the non-national worker, either of the following:

(i) implementing the remote working system.

(ii) Give the worker a paid leave.

(iii) Give the worker an unpaid leave.

(iv) Reduce the worker’s wage on a temporary basis during the said period.

(v) Reduce the worker’s wage permanently.

 

  UAE Labour Law Employees based onshore, who are subject to the UAE Labour Law only have a statutory entitlement to sick leave once they have passed any probation period (which can be up to 6 months) and completed an additional 3 months’ continuous service. They are then entitled to a minimum of 90 calendar days’ statutory sick leave per year, at the following rates:

(i) full pay for the first 15 calendar days of absence;

(ii) half pay for the next 30 calendar days; and

(iii) no pay for the remaining 45 calendar days.

India Ministry of Labour and Employment, 20.03.2020

 

 

 

Employers advised not to terminate the employment of their employees or reduction in salaries during the pandemic. Advised for paid sick leaves.[4]

 

Advisory

 

  Government of Karnataka vide notification No 170 dated 05.03.2020 Karnataka was the first state who had explicitly set out that all employers are required to provide infected employees, covered under ESI Act, 28 days’ mandatory paid sick leave.[5]

If the establishment do not fall under the realm of the ESI Act, an infected employee can still claim 28 days of paid leave under Section 15 (3) of the Shops and Commercial Establishments Act.

 

1st State in India to implement 28 days paid leave for sufferers
  Rule by Government of Rajasthan Special 30-day Quarantine leave may be sanctioned to the Health Care Workers in Rajasthan.[6]
South Africa

 

 

 

Section 22 , Basic Conditions of Employment Act 75 of 1997 (BCEA) The employee must be provided paid sick leave under S. 22 of the Basic Conditions of Employment Act 75 of 1997. As per Section 23 of the Act, the employer is not required to pay the employee if the employee is absent from work for more than two consecutive days unless the employee provides a medical certificate stating that the employee was unfit for work on those days.
  Compensation for Occupational Injuries and Diseases Act 130 of 1993 A special paid leave granted to the employees who have ‘Occupationally acquired COVID-19’, for self-quarantine recommended by a registered medical practitioner.
USA Families First Coronavirus Response Act (FFCRA)

(expired 31.12.2020)

The FFCRA law provided two types of paid leave for COVID-19 reasons: Emergency Paid Sick Leave (EPSL) and Expanded Family Medical Leave (EFML).

 

  Consolidated Appropriations Act, 2021 The Act came in force on 27.12.2020 and did not extend the FFCRA obligations.

Section 286 of Act – Extension of Credits for Paid Sick and Family Leave – It amends the FFCRA to allow employers to claim payroll tax credit for providing FFCRA leave for employees until March 31, 2021. Therefore, employers may voluntarily elect to provide FFCRA leave from January 1, 2021 to March 31, 2021 and if they do so, they can apply for a payroll tax credit for the amount of the FFCRA benefits paid during this extended time period.

 

USA California

California Paid Sick Leave Program[7]

The accumulated leaves of the employee or the provided by the employer under the Paid Sick Leave law. This may be 1 hour accrued for every 30 hours worked or 3 days/24 hours provided per year; employer may cap accrual at 48 hours and use at 3 days or 24 hours, whichever is greater, within a 12-month period.

Paid to the employee at their regular rate of pay or an average based on the past 90 days.

USA Arizona

Notification[8] of Need for Leave for COVID-19 Related Reasons (01.01.2021 onwards)

Employees who may be absent from work for reasons related to COVID-19 on or after January 1, 2021 should use the Notification and work with their employers regarding which type of leave is appropriate for their situation.
USA New Jersey

1.Paid Sick Leave

2. Federal Unemployment benefits (federal) (ends on March 13, 2021)

1.     Employers of all sizes must provide full-time, part-time, and temporary employees with up to 40 hours of earned sick leave per year.

2.     Anyone currently collecting unemployment in any amount is also receiving the $300 FPUC supplemental benefit.

 

USA New York

COVID-19 Sick Leave Law[9]

Paid sick leave is available to an employee for a maximum of three orders of quarantine or isolation, provided positive report of Covid-19 is submitted to the employer under the NY COVID-19 Sick Leave Law. The three-order maximum will only come into play in the following situations:

(i) When an employee is absent for a period of mandatory quarantine or isolation, returns to work, and then, at some later time (no specific time limitation established), tests positive for COVID-19; or

(ii) When an employee who was subject to an order or quarantine or isolation continues to test positive after the initial quarantine or isolation period ends.

USA[10] Virginia

Public Health Emergency Leave Policy (PHEL)

 

The paid leave hours provided in the Public Health Emergency Leave Policy (PHEL) will return to a maximum of 80 hours per leave year from 10th January, 2021. The exception approved in March that expanded paid time off to 160 hours will expire. The following exceptions related to PHEL eligibility/usage will continue:

(i)    Caring for family members diagnosed with COVID-19.

(ii)   Reasonable time to make Child/Dependent Care arrangements if related to COVID-19 business closings.

Reasonable time to make/adjust to Virtual or Hybrid Learning arrangements.

Virginia is the first state in the nation to enact a permanent workplace safety standard for COVID-19.
USA Pennsylvania

Temporary COVID-19 Paid Sick Leave Ordinance, passed on 8th December, 2020[11]

  1. Covered employees who work 40 hours or more per week are entitled to a minimum of 80 hours of COVID-19 Sick Time.
  2. Covered employees who work fewer than 40 hours per week are entitled to a prorated amount of COVID-19 Sick Time equal to the amount of time the employee is otherwise scheduled to work or works on average in a 14-day period, whichever is greater.
  3. Covered employees whose schedules vary from week to week, the amount of COVID-19 Sick Time available is based on the number of hours the employee was scheduled to work over the past 90 days (including hours for which the employee took leave of any type).
  4. Covered employees who are exempt from the federal Fair Labor Standards Act are assumed to work 40 hours per week, unless their normal work week is less than 40 hours, in which case the amount of COVID-19 Sick Time available is based on the normal work week.[12]

 

USA Washington, USA

 

Employers may provide more generous paid sick leave than that required by the paid sick leave laws. An employee can use the accrued leaves as part of paid sick leaves too.[13] Flexible

 

 

*Tanvi Singh, Editorial Assistant has put this story together

[1] https://coronavirus.fairwork.gov.au/coronavirus-and-australian-workplace-laws/pay-and-leave-during-coronavirus

[2] https://www.mom.gov.sg/covid-19

[3] https://www.mohre.gov.ae/en/media-center/corona-virus-covid19-procedures.aspx

[4] https://labour.gov.in/sites/default/files/Central_Government_Update.pdf ; DO No. M-11011/08/2020-Media dated 20 March 2020, Ministry of Labour and Employment.

[5] https://www.nishithdesai.com/information/news-storage/news-details/article/covid-19-leave-for-employees-in-bengaluru.html

[6] GOVERNMENT OF RAJASTHAN FINANCE DEPARTMENT RULES DIVISION No.F.I(l) FD/Rules/2012

[7] https://www.labor.ca.gov/coronavirus2019/

[8] https://hr.az.gov/sites/default/files/Notification%20of%20Need%20for%20Leave%20for%20COVID-19%20Reasons%20-%2001.21.2021.pdf

[9] https://coronavirus.health.ny.gov/system/files/documents/2021/01/guidanceonuseofcovid-19sickleave_0.pdf

[10] https://www.dhrm.virginia.gov/docs/default-source/covid-19/phel-update-120220.pdf?sfvrsn=be14a2f1_0

[11] https://pittsburgh.legistar.com/LegislationDetail.aspx?ID=4701797&GUID=2D2C3863-DF9E-4127-A514-976420C4A7FD&Options=ID%7cText%7c&Search&FullText=1

[12] The provisions of this Chapter shall expire upon expiration of either the COVID-19 emergency disaster Declaration of the Commonwealth of Pennsylvania or the COVID-19 emergency disaster Declaration of the City of Pittsburgh; whichever is sooner. S.2, Temporary COVID-19 Paid Sick Leave Ordinance, passed on 8th December, 2020

[13] https://lni.wa.gov/

COVID 19

On January 29, 2021, in response to the President Biden Executive Order directing the Occupational Safety and Health Administration (OSHA) to update safety recommendations for businesses, the Occupational Safety and Health Administration issued updated Guidance on Protecting Workers: Guidance on Mitigating and Preventing the Spread of COVID-19 in the workplace.

This guidance is intended to inform employers and workers in most workplace settings outside of healthcare to help them identify risks of being exposed to and/or contracting COVID-19 at work and to help them determine appropriate control measures to implement. It contains recommendations as well as descriptions of existing mandatory safety and health standards.

Some of the Recommendations are discussed below:

  1. Assignment of a workplace coordinator who will be responsible for COVID-19 issues on the employer’s behalf.
  2. Identification of where and how workers might be exposed to COVID-19 at work.
  3. Identification of a combination of measures that will limit the spread of COVID-19 in the workplace, in line with the principles of the hierarchy of controls.
  4. Consideration of protections for workers at higher risk for severe illness through supportive policies and practices.
  5. Establishment of a system for communicating effectively with workers and in a language they understand.
  6. Educate and train workers on your COVID-19 policies and procedures using accessible formats and in a language they understand.
  7. Instruct workers who are infected or potentially infected to stay home and isolate or quarantine to prevent or reduce the risk of transmission of COVID-19.
  8. Minimize the negative impact of quarantine and isolation on workers.
  9. Isolating workers who show symptoms at work.
  10. Performing enhanced cleaning and disinfection after people with suspected or confirmed COVID-19 have been in the facility.
  11. Providing guidance on screening and testing.
  12. Recording and reporting COVID-19 infections and deaths.
  13. Implementing protections from retaliation and setting up an anonymous process for workers to voice concerns about COVID-19-related hazards.
  14. Making a COVID-19 vaccine or vaccination series available at no cost to all eligible employees.
  15. Not distinguishing between workers who are vaccinated and those who are not.

Read the complete Guidance HERE

Case BriefsSupreme Court

Supreme Court: In a major win for Private Schools in the State of Rajasthan, the bench of AM Khanwilkar and Dinesh Maheshwari, JJ has directed the School Managements to collect fees for the academic year 2019-2020 as well as 2020-2021 from the students, equivalent to fees amount notified for the academic year 2019- 2020, in six monthly installments commencing from 5th March, 2021 and ending on 5th August, 2021.

Noticing that the hearing in the matter is likely to take some more time, the Court passed ‘interim directions which will address the concerns of all parties in some measure’.

In the order that came as a big blow to the parents as most of the classes in the year 2020 have been conducted online due to the outbreak of COVID-19 pandemic, the Court, in order to balance the interest of the Schools and the parents, further passed the following interim directions:

  1. The Management shall not debar any student from attending either online classes or physical classes on account of non-payment of fees, arrears/outstanding fees including the installments, referred to above, and shall not withhold the results of the examinations of any student on that account.
  2. Where the parents have difficulty in remitting the fee in terms of this interim order, it will be open to those parents to approach the school concerned by an individual representation and the management of the school will consider such representation on a case-to-case basis sympathetically.
  3. The above arrangement will not affect collection of fees for the academic year 2021-2022, which would be payable by the students as and when it becomes due and payable, and as notified by the management/school.
  4. In respect of the ensuing Board examinations for classes X and XII (to be conducted in 2021) the school management shall not withhold the name of any student/candidate on the ground of non-payment of the fee/arrears, if any, on obtaining undertaking of the concerned parent/student.

The Court, however, clarified that the above arrangements would be subject to the outcome of the matters pending before the Court including the final directions to be given to the parties and without prejudice to the rights and contentions of the parties in these proceedings.

The Court also directed the State of Rajasthan to ensure that all government outstanding dues towards unit cost payable to respective unaided schools are settled within one month from the today and, in any case, before 31st March, 2021.

The matter will now be taken up for hearing on February 15, 2021.

[Gandhi Sewa Sadan Rajsamand v. State of Rajasthan, 2021 SCC OnLine SC 70, order dated 08.02.2021]

COVID 19Hot Off The PressNews

Standard Operating Procedure on preventive measures to contain the spread of COVID-19 for cinema halls and theatres released.

The SOP states that no Exhibition of Film shall be allowed in containment zones and that States/UTs may consider proposing additional measures as per their field assessment. The SOP states that hundred per cent seating capacity is allowed inside cinema halls.

The SOP clarifies that all COVID related safety measures must be adhered to inside the premises. The General Guidelines specify that respiratory etiquettes must be followed including usage of face masks, adequate social distancing of at least 6 feet to be followed outside the auditoriums, common areas and waiting areas at all times, spitting will be prohibited and usage of Aarogya Setu app will be encouraged.

Thermal screening of visitors would be carried out at entry and exit should be done in a staggered row-wise manner to avoid crowding. e. Sufficient time interval between successive screenings on a single screen as well as on various screens in a multiplex shall be provided to ensure row-wise staggered entry and exit of the audience. Staggered show timings shall be followed for multiple screens to avoid crowding.

The SOP promotes usage of contactless digital transactions for payments for tickets, food, and beverages etc. Sufficient number of box office counters shall be opened and purchase of tickets at the box office shall be open throughout the day and advance booking shall be allowed to avoid crowding at the sale counters.

Stressing on the sanitisation of the entire premises, the SOP calls for frequent sanitization of the entire premises, common facilities, and all points which come into human contact, e.g. handles, railings, etc. shall be ensured and auditorium shall be sanitized after every screening.

The SOP has laid down specific measures for creation of public awareness against COVID by display of Do’s and Don’ts throughout the premises by way of announcements, standees, posters etc.

The detailed SOP can be read the link below:

https://mib.gov.in/sites/default/files/FINAL%20SOP%20for%20Exhibition%20of%20Films%20%281%29.pdf


Ministry of Information & Broadcasting

[Press Release dt. 31-01-2021]

[Source: PIB]

Case BriefsHigh Courts

Delhi High Court: Prathiba M. Singh, J., while considering the re-opening of spas in GNCTD expressed that:

“While the spread of Covid-19 is the main factor to be considered, it has to be also balanced with the interest of reopening of businesses and establishments to bring back a semblance of normalcy.”

Petitioner an association of wellness Ayurveda and Spa providers in NCT Delhi is aggrieved by the delay by GNCTD and the Ministry of Home Affairs in issuing guidelines for re-opening of spas sought quashing of order dated 03-08-2020 issued by the Ministry of Health and Family Welfare (MoHFW).

After the lockdown in March, 2020, though various other establishments were permitted to reopen and commerce businesses, spas have still been forced to remain closed.

Petitioners relied on MOHFW’s office memorandum dated 18-11-2020 permitting the reopening of spas subject to conditions.

Despite the above, GNCTD did not permit the reopening of spas.

Senior Counsel, Mr Datta submitted that salons and other similar places have been opened but not giving permission for reopening of spas is discriminatory.

This Court vide order dated 04-12-2020 came to a prima facie conclusion that the distinction sought to be made between the salons and spas would be discriminatory.

GNCTD’s affidavit had the only reason for not giving permission on re-opening of spas which was the longer duration of proximity with the client.

Decision

Bench expressed that several developments have taken place including the reduction in the number of COVID-19 cases as also the introduction of a vaccine.

“…the question of reopening any particular class of establishments is a delicate one to be taken after due consideration of the relative merits and demerits.”

As of June, 2020, i.e., almost 6 months ago, salons which offer similar services have already been opened in Delhi, subject to such establishments observing standard operating procedure prescribed by the MoHFW.

High Court opined that the slight difference in the nature of services and a slightly higher percentage of risk due to the proximity of the client and the service provider can be obviated by prescribing stricter measures and safeguards rather than continuing to keep such establishments closed. 

Difference between salons and spas

Court observed that it cannot also be lost sight of that several salons also provide services akin to those provided in spas. The difference between the services provided in Salons and Spas is very minimal. The said services require service providers and service takers to remain in close proximity for sufficient duration.

Hence,

“…while allowing the opening of salons, continuing the embargo on spas would be violative of the rights of these establishments and their employees.”

High Court is conscious of the importance of prescribing strict safeguards that ought to be taken by establishments providing spa services as also the clients who visit the establishments, the continuation of the embargo on reopening of spas is unjustified.

Therefore, in light of the above, Court permitted the reopening of spas, wellness clinic and similar establishments, in the GNCTD, subject to the following conditions:

  • There shall be strict compliance of the conditions specified in the office memorandum of 18-11-2020 prescribed by the MoHFW in respect of spas. The 6 feet distance shall be in general maintained between clients and employees. Insofar as the service providers i.e., therapists etc., are concerned, they shall maintain all standards of hygiene, masking etc., as set out below;
  • In addition, considering the nature of services provided in spas, all employees in such establishments shall undergo fortnightly RTPCR tests, especially the therapists who are likely to come in close contact with the clients.
  • All therapists and other employees, as also the visitors, shall be subjected to thermal temperature checks and if anyone shows any symptoms, they would not be permitted entry in the establishment.
  • All service providers shall wear face shields and masks while providing therapy. For treatments which are longer than thirty minutes, a PPE kit should also be worn in addition.
  • Clients should preferably wear masks to the extent possible, considering the nature of services which are availed of.
  • All visitors/clients shall sign a declaration form to the effect that they have not contracted Covid-19 and if they have, they have tested negative. The establishments are permitted to take a written consent form accepting the risks that may be involved for clients/visitors.
  • Tools including clothing, other apparel, towels etc., used for clients, shall be sanitised after each and every treatment.
  • It shall be ensured that hygienic conditions are maintained in the spas and any other safeguards in force for salons shall also be adhered to by the spas.

Bench permitted to open spas, wellness clinics and similar establishments in light of the above conditions.[Sukaita v. GNCTD,    2021 SCC OnLine Del 61, decided 14-01-2021]


Advocates who appeared for the parties:
Petitioner: Sachin Dutta, Senior Advocate with Lal Singh and Sudhir Tewatia, Advocates. Randhir Kr. Lal, Advocate.
Respondents: Anupam Srivastava, ASC for GNCTD Advocate for R-1.

Shalini Nair, Anjana Gosain & Aditi Amitabh, Advocates. for R-2

Case BriefsSupreme Court

Supreme Court: The three-judge bench comprising Ashok Bhushan*, R. Subhash Reddy and M.R. Shah, JJ., addressed the instant petition questioning the closure of the Anganwadi Centres across the country. The Bench said, “Government has a constitutional obligation to preserve human life.”

Background

 Through Anganwadi Centres, supplementary nutrition to pregnant women, lactating mothers, adolescent girls and children up to the age of 6 years were being provided which fulfilled the State objective of holistic development of children under 6 years and to provide food and nutrition to the beneficiaries as mandated by Article 47 of the Constitution. After spread of Covid-19, Anganwadi Centres were closed throughout the country in March, 2020. Distribution of special nutrition and other benefits, being essential services were permitted to be conducted by Anganwadi staff by resorting to Take Home Ration. The Supplementary Nutrition Programme supplied under ICDS Scheme was of two types for different beneficiaries’ i.e.

(a)Take Home Ration for pregnant women & lactating mothers and children in the age group of 6 months to 3years; and

(b) Morning Snacks and Hot Cooked Meal for children in the age group of 3-6 years.

Lockdown was lifted by the competent authority in phased manner and gradually specified activities were permitted to be opened but even during the post-lockdown period; beneficiaries, children pregnant women and lactating mothers continued to suffer due to non-opening of Anganwadi in various States. Counsel for the petitioner, Colin Gonsalves contended that pandemic has caused severe strain on the employment and means of livelihood of a large section of society especially marginal sections, therefore, they require immediate extension of all benefits as envisaged in the Scheme. National Human Rights Commission had also made recommendations on 28-09-2020 and 29-09-2020 after impact assessment, issued advisory to reopen Anganwadi Centres immediately. The petitioner further submitted that due to non-providing of hot cooked meals to children up to the age of six years and children who were affected of malnutrition they were suffering which needed immediate attention and remedial action.

Observations

 Considering above mentioned facts, the Bench expressed, “Inadequate supply of nutritious food to the citizens, more particularly to children and women would affect their health. Therefore, the same shall be in violation of their fundamental right to health/right to live with dignity guaranteed under Article 21 of the Constitution.”

 Government had launched an Integrated Child Development Services Scheme in the year 1975; which was designed as an early childhood development programme aimed to address health, nutrition and development needs of young children, pregnant and nursing mothers. Later, another Act, National Food Security Act, 2013 (“the Act, 2013”) was enacted to provide for food and nutritional security by ensuring access to adequate quantity of quality food at affordable prices to people to live a life with dignity and for matters connected therewith. The Act, 2013 by Section 4 creates a statutory right of every pregnant woman and lactating mother of free meals during pregnancy and six months after the child birth. Section 5 provides for free of charge nutritional support to children, in case of children in the age group of six months to six years, age appropriate meal through the local Anganwadi so as to meet the nutritional standards. Anganwadi Centres had been given statutory recognition under the Act, 2013 and Section 7 had created an obligation on the State Governments to implement schemes covering entitlements.

On observing that ready to eat nutritional traditional sweet was provided by some States in lieu of hot cooked meals to 3 to 6 years’ children, the Court stated that the State ought to include certain cereals in Take Home Ration instead of providing only ready to eat substitutes. The nutritional standard as provided in Schedule II of Act, 2013 was mandatory to be complied with by the States.

The Court said, “Children are the next generation and therefore unless and until the children and the women have the nutritious food; it will affect the next generation and ultimately the country as a whole.” Article 47 of the Constitution had also provided that one of the primary duties of the State is to raise the level of nutrition and the standard of living of the people.

Noticing that some States were under the impression that the order issued by the Ministry of Home Affairs dated 25-11-2020, provided for not opening of the Centres, the Court discussed Para 16 of the said order;

“16. Persons above 65 years of age, persons with co-morbidities, pregnant women, and children below the age of 10 years are advised to stay at home, except for essential and health purposes.”

 The Bench explained that, paragraph 16 did not in any manner create any prohibition in opening of Anganwadi Centres as the services provided by Anganwadi Centres were essential services.

 Decision

 The Court held that the State had to provide an appropriate mechanism for supervision and check. Child development officers and other district level officers who were entrusted to monitor the functioning of Anganwadi Centres had to be extra vigilant so that no beneficiary is denied its dues.

In view of the above observations, the Court disposed of the petition with following directions:

  1. All States/Union Territories which had not yet opened Anganwadi Centres should open the same on or before 31-01-2021 situated outside the containment zone.
  2. Decision for not opening Anganwadi Centres should be taken only after the State Disaster Management Authority direct for not opening of Anganwadi Centres in particular area of the State situated outside containment zone.
  3. Anganwadi Centres situated in the containment zone shall not be opened till the containment continues.
  4. All States/Union Territories should ensure that nutritional standards as provided in Schedule II of National Food Security Act, 2013, is fulfilled by providing nutritional support to pregnant women, lactating mothers, nutritional support to children who suffer from malnutrition.
  5. All the States/Union Territories should issue necessary orders regarding monitoring and supervision of Anganwadi Centres to ensure that benefit reaches to the beneficiaries and a Complaint Redressal Mechanism should be put in place in each district.

[Dipika Jagatram Sahani v. Union of India, 2021 SCC OnLine SC 22, decided on 13-01-2021]


*Justice Ashok Bhushan has penned the judgment

COVID 19Op EdsOP. ED.

In the era of globalisation, when multinational enterprises (MNEs) have branches, divisions, subsidiaries and offices operating across the globe; it is common for them to transact goods and services from one jurisdiction to an associated enterprise in another tax jurisdiction.[1]

  1. The story so far­

The topic that is dominating conversations worldwide is the COVID-19 pandemic. In addition to the serious health impact of the virus, it is also affecting vital components of the global economy, such as production, the supply chain, consumption and financial markets.

The restrictions on economic activity have led to the disruption of supply chains. Businesses are facing a drop in demand as income levels are declining. Manufacturing and distribution functions that require transportation, physical labour, logistics and movement of people have been hit the hardest. Industrial sectors such as airlines, hospitality and tourism, and luxury retail have seen deeper declines compared to others. Many companies have moved towards digital means of delivering products and services and implemented work-from-home measures as they adapt to operate in a COVID world. Some operating costs, such as travel costs within organisations, are declining and could help preserve margins in the face of reduced revenue. Companies are focused on conserving cash and ensuring liquidity in their operations.

At a time like this, the transfer pricing policies (price paid by the parent company or foreign arm to a local subsidiary for transactions between them[2]) that guarantee the entities within the group — contract manufacturers, limited risk distributors, suppliers captive services — a guaranteed minimum profit, are becoming very difficult to implement. At the same time, risk-taking entities, such as licensed manufacturers and regional distributors, do not make enough profit from local operations to pay committed intra-group royalties or distribution rights payments. As a result, the financial results of the group and, in particular, of the parent company are under pressure.

  1. Covid-19’s business impact

The impact of the coronavirus (COVID-19) is being felt by all companies in the world. It has changed the way the world functioned, just like the Great Depression and the 2008 financial crisis, did in the past.[3] But everyone’s main concern is “will things get back to normal?” The reality is that many companies are struggling and some have even ended. But seeing the economic adversities of the past, there is renewed hope for recovery with the emergence of new industries. Consequently, things will return to normal, but the “new normal”!

Various businesses have been impacted due to COVID-19. The impacts include:

  • Reduction of profits or losses due to significant reductions in third-party income.
  • Interruptions in the supply chain that cause difficulties in the delivery of goods and services to group companies.
  • Increase in the cost of debt, due to the increase in the credit quality of an individual group or group entities.
  • Guarantees for third-party financing at the request of external funders, in response to breaches of debt agreements or requests for additional debt.
  1. impact on Transfer Pricing

COVID-19 has radically changed the businesses on an unprecedented scale, with an impact that varies between different businesses. This triggers the need to review and potentially amend transfer pricing policies to reflect new economic conditions and ensure appropriate allocation of gains or losses, as transfer pricing is often designed assuming the overall earnings of the group and thus therefore, the impact of these economic changes can result in distortions, in the allocation of profits and losses between group companies.[4]

Some common transfer pricing issues that businesses are addressing during this outage period are: financial transactions, business-to-business contracts, disruption management, intangibles, remote work, operational transfer pricing, fees, dispute resolution, and APAs. Other issues include:

Pressure on Existing Transfer Pricing Policies

Existing transfer pricing policies are already under pressure with the ongoing economic downturn. One element of this is that negatively affected companies will be asked in the future to explain low operating profit or loss to tax authorities for both the current and upcoming years. It may be prudent to model the impact of COVID-19 on operating results, to help demonstrate in the future the business justification for changes in transfer pricing and other planning decisions, and ultimately show that low profits or losses were not the result of non-arm’s length transfer pricing policies.

Need to Adjust Transfer Pricing Models

There may be a need to adjust transfer pricing models so that they are in line with any commercially driven changes made to the global supply chain,[5] and to ensure they reflect any reallocation of roles, assets and risks across the group. Businesses will have to review whether actual conditions experienced are synonymous with past transfer pricing policies, and as a result legal arrangements become critical (and may need to change) to show the actual versus economic allocation of functions, assets, and risks.

Potential Breach of Advance Pricing Agreements (APA)

  • What is APA?

APAs made with the tax authorities are an effective risk management tool to minimise disputes over the transfer pricing agreements adopted. The taxpayer’s proposed arm’s length price/range uses past transactions to forecast future business earnings and make so-called “critical assumptions.” These critical assumptions generally do not consider a change in the economic conditions or the FAR of the counterparty involved in the transactions, or fundamental changes in the conditions of a particular industry. Taxpayers who have agreed to an APA with the Department of Revenue should review critical assumptions and assess whether the COVID-19 pandemic could trigger the need to consult with tax authorities, renegotiate the agreed approach, or review or cancel the APA.

  • Potential Breach

All existing APAs should be re-examined and new ones should be reconsidered due to the impact of COVID-19 on the group. Certainty is provided by APA about the agreed transfer price or profit margin over several years, provided they are met with critical assumptions. Taxpayers and tax administrations agree on critical assumptions that, if not met, allow them to reconsider the APA. The APA would be cancelled if, due to COVID-19 or otherwise, the agreed critical assumptions are no longer met. As an alternative, there might be renegotiation of APA by the taxpayers and tax administrations.

Non-compliance with the APA could include: proceeding with business as usual, renegotiating the APA during the time period of demonstrable impact, and suspending the APA modification for a specified period.[6]

  1. Suggested Transfer Pricing Method

Profit/Loss Splits

Current transfer pricing analyses primarily focus on an operating profit-based comparison between a tested party and comparable companies using the transactional net margin method[7] (TNMM). However, in a world under recession, the transactions between companies and the behaviour of the companies of a multinational group may change, requiring a change in the most appropriate transfer pricing method to be applied to test compliance with the principle of arm’s length. For example, some group companies may begin to perform greater functions and take greater risks in a recessionary phase. Practical limitations on the availability of adequate and reliable data for comparable companies could be another factor driving change when examining the most appropriate transfer pricing method to administer during an economic downturn.

Applying a profit and loss split method to determine arm’s length considerations in such cases may be more appropriate than using historically administered TNMM-based methodologies. In all of these instances, the search must carefully consider the new data and apply a transfer pricing methodology that autonomous third parties would have agreed to under similar facts and circumstances.

  1. Industry Outlook and Analysis

Although it is an incipient situation, the global epidemic of COVID-19 is already, possibly the most socially disruptive global event of our lives. As the pandemic persists, it is clear that the economic impact of the crisis will worsen. Businesses will suffer and industries can transform in unforeseen ways. From a transfer pricing perspective, it is crucial to understand the implications of this pandemic. Through careful consideration of transfer pricing and economic theory, evaluation of heuristic approaches, and collaboration with tax advisers and operational staff, businesses can chart a course as the world comes up from this unprecedented event.

Moreover, this challenging situation has brought with it a series of uncertainties that could lay the foundation for innovative solutions from multinational companies and business consultants to address the critical situation at hand. Governments are promoting different ways to reduce the economic situation in various countries, by introducing tax relief and risk mitigation measures to help multinational companies support their business positions. MNEs need to map their way to align the transfer pricing considerations that arise from this exceptional situation.

A correct saying during these challenging times –

‘It is not the strongest or the most intelligent who will survive from the crisis, but those who can take actions to best manage the change.’[8]

Hence, action should be taken to best manage the transfer pricing policies in order to mitigate loss.


*4th year student, BA LLB (Hons.), National University of Study and Research in Law, Ranchi. Author can be reached at singhalankrita2@gmail.com

[1] Transfer Pricing, The Institute of Companies Secretaries of India, May 2018

[2] Sachin Dave, COVID-19 impact: Transfer pricing issues may crop up at MNCs, The Economic Times (April 13, 2020)

[3]Gita Gopinath, The Great Lockdown: Worst Economic Downturn Since the Great Depression, IMFBlog (April 14, 2020)

[4] Steve D. Felgran & Steven C. Wrappe, INSIGHT: It’s Different This Time – Pandemic- Induced Recession Drives Transfer Pricing Changes, Bloomberg Tax, June 26, 2020.

[5] Patrick van Leeuwen, Potential impact of COVID-19 on your current transfer pricing model: Is action required?, Bakertilly (May 8, 2020)

[6] Tax impact of COVID-19 on intragroup arrangements, Allens-Linklaters (April 17, 2020)

[7] Jose Rafael Monsalve, Application of the Transactional Net Margin Method in transfer pricing analysis, CIAT (July, 15, 2019)

[8]  Leon C. Meggison

Case BriefsHigh Courts

Kerala High Court: A Division Bench of C.T. Ravikumar and K. Haripal, JJ., allowed various petitions in connection with Sabrimala pilgrimage and heard them jointly.

The petitioners sought direction to enhance the permissible number of pilgrims to 10000 on the grounds that earlier, during Makaravilakku season more than 1,00,000 devotees used to come for darshan on certain days and that a huge infrastructure was available at Sannidhanam for pilgrims. Additional prayers were made by the petitioner of W.P.(C) No.23885 to direct the respondents to allow all the devotees who hold the Covid-19 negative certificates to undertake Sabarimala pilgrimage and not to insist for production of any other certificate for the sacred journey. It was also requested to direct Travancore Devaswom Board (TDB) to take steps to avert extinction of the burning fire lit up near the banyan tree as part of customary ceremony (Aazhi) and to intensify it besides to permit pilgrims to offer the coconut filled with ghee called “Ney Thenga”.

A decision was taken by the Government to permit pilgrimage at Sabrimala in a restrictive manner during Mandala-Makaravilakku season, taking into account the Covid-19 pandemic situation. The state had constituted a High Level Committee (“the Committee”) for formulating measures for crowd management in Sabarimala and other locations in the State in connection with the Sabarimala pilgrimage. The Committee had taken following decisions:

a) The number of devotees permitted to visit may be fixed as 1000 on weekdays and 2000 on weekends. Maximum devotees on Mandalapooja and Makaravilakku days may be fixed as 5000.

b) For effectively carrying out pilgrim’s digital queue, virtual queue management system would be implemented by the Police department.

c) All devotees should provide Covid negative certificate from an authorized lab.

Later on, the Committee, by its decision dated 15-10-2020 enhanced the number of pilgrims on weekdays, on weekends and on special pooja day respectively as to 2000, 3000 and 5000 based on inflow of the registered pilgrims at Sabarimala during the initial 10 days of the pilgrimage and the fact that about 40% of pilgrims who had register might not undertake the pilgrimage during current situation of the pandemic. Also, due to inconclusiveness of the Antigen test results, only those pilgrims who would reach Nilakkal with a certificate obtained from any NABL accredited, ICMR approved Laboratories after conducting RT-PCR test done within 48 hours of their reaching Nilakkal were permitted to conduct pilgrimage.

It was submitted by TDB that, when pilgrimage was possible only for persons who got registered in the virtual queue management system it would be possible to fix the time for registrants in such a manner to avoid crowding in Sannidhanam. It was further submitted that with strict adherence to Covid-19 protocol it would be possible to permit 10000 people to undertake pilgrimage.

The Court held that in view of the surge of Covid-19 positive cases, number of pilgrims was rightly decided to be limited and that it could be safely fixed as 5000. On grievance regarding the extinction of burning fire near the sannidhanam called “Aazhi”, the Court observed that were already taken to avert such a situation and to maintain “Aazhi”. The Court after taking into account the fact that the antigen test could not be considered as a conclusive test regarding the covid positivity upheld the decision of the Committee to insist that Covid-19 Negative certificate should be one obtained after conducting RTPCR test within 48 hours of reaching Nilakkal, from NABL accredited ICMR approved laboratories. In view of the above, the instant petitions were dismissed as infructuous. [Travancore Devaswom Board Employees Front v. State of Kerala, WP(C) No. 23869 of  2020(G), decided on 18-12-2020]

Op EdsOP. ED.

Vide an Ordinance dated 05.06.2020[1], the Government of India suspended the operation of Sections 7, 9 and 10 of the Insolvency and Bankruptcy Code, 2016 (‘IBC, 2016’) with a view to shield corporates from fresh insolvency actions, citing economic slowdown on account of the COVID-19 pandemic (‘the Ordinance’). The move ensured that corporates in India could not be dragged to insolvency courts for any default in re-payment of debt which occurred after 25.03.2020. The suspension of fresh insolvency actions for defaults which occurred after 25.03.2020 was initially for a period of six months (with effect from 25.03.2020), and has been extended for another three months with effect from 25.09.2020 vide  Notification dated 24.09.2020.

Introduced as a tool to help small businesses survive during the COVID-19 pandemic, the Ordinance dated 05.06.2020 attributed reasons such as:

(i) uncertainty and stress for business for reasons beyond their control;

(ii)difficulty to find adequate number of resolution applicants to rescue the corporate person who may default in discharge of their debt obligations;

(iii)expediency to exclude the defaults arising on account of unprecedented situation for the purposes of insolvency proceeding under this Code etc. for its immediate promulgation.

What is conspicuous by its absence, though, is a similar suspension of relevant provisions of Part III of IBC, 2016 dealing with individual/personal insolvency, including personal guarantors to corporates. It is fair to assume that the economic slowdown as a result of COVID-19 would affect the corporates as well as individual guarantors equally, at least insofar as their ability to repay the debts is concerned. This has led to a peculiar situation wherein the creditors now have the option of proceeding against the personal guarantors even during COVID-19 pandemic, but are statutorily barred from proceeding against the corporates/principal debtors for the same debt.

The same goes against the very objective of IBC, 2016 – which was enacted to restructure and resolve bad debts by way of a Corporate Insolvency Resolution Process. The limited suspension of provisions of IBC, 2016 on account of COVID-19 has the effect of converting the said legislation into a mere money recovery tool. While there is no quarrel with the position of law that liability of a guarantor and a principal is co-extensive, and the creditor has the option of proceeding against either of them for recovery of its debt. However, allowing a creditor to proceed against the personal guarantor of a corporate debtor, without any attempts at restructuring/resolution of debt militates against the core objectives of IBC, 2016.

It will also be seen that the provisions of Part III of IBC, 2016 have only recently been notified by the Government of India vide a Notification dated 15.11.2019. A prima facie examination of the legislative scheme envisaged under Part III of IBC, 2016 reveals that the same are unfairly prejudicial to the interests of personal guarantors.

Firstly, under the current regime of IBC, 2016, a creditor has the option of simultaneously proceeding against the Corporate Debtor and a personal guarantor of a corporate debtor for the same debt. This may lead to a situation where the creditor despite having filed and recovered part of its debt before a Resolution Professional in the Insolvency Resolution Process of the corporate, proceeds to file its claims for the complete debt in the Insolvency Resolution Process of the personal guarantor. The Insolvency Law Committee Report, 2020 (published by the Ministry of Corporate Affairs, India) recognises this anomaly and suggests that upon recovery of any portion of claim by a creditor in one proceeding, there should be a corresponding revision in the claim filed in another proceeding. This is to prevent the creditors from unjustly enriching itself and realising more amounts than what is actually due to it.

Secondly, Section 96 of the IBC, 2016 imposes an ‘interim moratorium’ in relation to ‘all the debts’ of the guarantor as soon as an application under Sections 94/95 of IBC, 2016 seeking to initiate Insolvency Resolution of the personal guarantor is ‘filed’. During the subsistence of such interim moratorium, all legal proceedings initiated against the personal guarantor in respect of any debt shall be deemed to be stayed. The same is in the teeth of established principles which require the adjudicating authorities under the IBC, 2016 (the Tribunals) to observe principles of natural justice, inasmuch as the ‘interim moratorium’ will be imposed on the date of filing of an application under Part III without any adjudication by any judicial forum and without an opportunity of hearing being afforded to the personal guarantors.

Thirdly, there appears to be no express provision under Part III of IBC, 2016 allowing a personal guarantor to appeal against the order passed by the adjudicating authority. The only provision which entitles an aggrieved party to file an appeal before the appellate authority is Section 61. However, Section 61 only allows an aggrieved a party to prefer an appeal against the orders passed by the Adjudicating Authority under Part II of IBC. Since an order of interim moratorium under Section 96 or a moratorium under Section 101 by the adjudicating authority is an order passed under Part III of IBC, 2016, the remedy to an aggrieved guarantor may not lie under Section 61.

Fourthly, there appears to be no intelligible differentia in enforcing the provisions under Part III of IBC, 2016 only qua ‘Personal Guarantors to Corporate Debtors’ vide the Notification dated 15.11.2019, and not qua other individuals and partnership firms as referred to in Part III. While the statute itself makes no sub-classification/categories of guarantors, individuals and partnership firms, the Notification dated 15.11.2019 appears to enforce the provisions of Part III only qua personal guarantors to corporate debtors.

Fifthly, as stated above, there appears to be no justification or rationale as to why suspension of initiation of insolvency resolution process of guarantors during the COVID-19 pandemic ought not to include suspension of initiation of insolvency process against personal guarantors.

The time is ripe for the legislature to take immediate steps in order to secure the interests of personal guarantors, especially during the COVID-19 pandemic.


*The author is a practising Advocate in New Delhi, and can be contacted at vipul.rmlnlu@gmail.com.

[1] Insolvency and Bankruptcy Code (Amendment) Ordinance, 2020

Case BriefsHigh Courts

Patna High Court: Rajeev Ranjan Prasad, J., addressed petitions filed jointly by foreign nationals from Bangladesh, Malaysia and Australia on the ground that they had been unlawfully framed in controversial Tablighi incident.

Factual Matrix

 In CR. WJC No. 367 of 2020, petitioners 1 to 9 were foreign nationals from Bangladesh who came to India on tourist visa and were charged with the offence of spreading religious ideologies under Sections 14 and 14(C) of the Foreigners Act, 1946, and petitioners 10 and 11 were Indian nationals, who were allegedly assisting the foreigners in the said offence, whereas, in Cr.W.J.C. No. 369 of 2020, petitioner 1, an Indian national, was the secretary of Jama Masjid, Bihar while petitioners 2 to 10 were foreign nationals from Malaysia and Australia. It was alleged that these petitioners visited ‘Nizamuddin Markaz’, Delhi prior to Tablighi Conglomeration, thereafter they reached Araria, Bihar on 11-03-2020 and were residing in ‘Rawahi Markaz’ since 15-03-2020 and Mosque since 21-03-2020 respectively.

On 24-03-2020 a nation-wide lockdown for 21 days was declared with an aim and object to check the spread of Covid-19. Consequently, the petitioners were screened by the administration and then they remained quarantined for the mandatory period as per the government’s Standard Operating Procedures (SOPs). Pursuant to the directions as contained in letter No. 91 dated 09-04-2020 issued by the Ministry of Home Affair, Government of India, Bihar Police registered the present F.I.R. against these petitioners. Later on, Chief Judicial Magistrate, Araria had also taken cognizance and summons had been issued to these petitioners.

The charges against these petitioners were of,

  • Non-furnishing of information about their visits to the police and
  • Getting involved in the spread of religious ideologies by a foreign national who is visiting India on a tourist visa,

offences under Sections 14 and 14(C) of the Foreigners Act, 1946

Submission on behalf of Petitioners

The counsel for the petitioners, P.K. Shahi, submitted that on perusal of FIR, it may be held that no offence at all was made out against these petitioners. It was submitted that the order taking cognizance and issuance of summons had been passed in a routine and mechanical manner and the same were liable to be set aside.

The counsel while relying on Anand Kumar Mohatta v. State (Govt. of NCT of Delhi, (2019) 11 SCC 706, submitted that, submission of charge-sheets and order taking cognizance is no bar in quashing of the F.I.R. It was submitted by the petitioners that neither at the time of registration of the FIR were they found involved in any act of preaching religious ideologies nor in course of investigation the Police had collected any material in any form to show that they had addressed any gathering or had indulged in preaching their ideologies. It was further argued that a mere bald allegation without there being any material to show that they were involved in preaching religious ideologies would not attract the application of Sections 14 and 14-C of the Act. Reliance was also placed on Konan Kodio Ganstone v. State of Maharashtra, 2020 SCC OnLine Bom 869, in which Bombay HC had quashed FIR in respect of foreign nationals who had been arrested from Masjids during nationwide lockdown holding that, a foreign national may visit Masjid and can go there to observe a religious practice or to offer Namaz, there was also no material on the record to show that the Indians were prevented from accommodating persons in the Masjid including the foreigners.

 As per the relevant provisions of Registration of Foreigner Rules, 1992, it was hotel and those places which are covered under the definition of “Hotel” under Rule 14 (7) where the foreign nationals had stayed were required to furnish information regarding the stay to the local police and there was no personal liability on foreigners to inform the local police about the same, also the counsel for the petitioners submitted that a ‘Mosque’ or ‘Markaz’ was not covered under the definition of “Hotel” under  Rules, 1992.

Stand of the Government

Additional Solicitor General, Dr K. N. Singh submitted that the Government of India had a consistent policy that a foreign national visiting India on tourist visa could not indulge in preaching religious ideologies unless so permitted by the Government. It was further submitted that in case the management of ‘Markaz’ or ‘Masjid’ had been providing lodging facility to a foreign national or a team of foreign nationals on regular basis the facilities so provided to a traveller would be covered within the meaning of the word ‘a boarding house; or ‘a rest-house’.

Observations

The Court after considering various guidelines issued by Union Home Ministry, Government of India observed that the purpose behind those guidelines was to ensure that the foreign nationals who were visiting India on Tourist Visa did not indulge in Tabligh work. The guidelines gave them permission to attend Tabligh Jamaat (congregation) and such act of mere attending the Tabligh Jamaat did not amount to Tabligh work prohibited under those instructions. In course of investigation also police had not collected any material in any form to take a prima-facie view that these foreign nationals were indulged in religious/tabligh work. The allegation of preaching religious ideologies was thus not supported by any material. In absence of any material, it appeared to this Court that the Chief Judicial Magistrate, Araria had taken cognizance and decided to issue a summons in a routine and mechanical manner.

On the contention as to whether Markaz or Mosque were required to inform about the stay of foreign nationals to the local police the Court observed that there was no ban or restriction on the stay in these places but it could not be said that the Management were not required to report the stay of foreign nationals on Tourist Visa in the premises of the ‘Mosque’ or ‘Markaz’.  The Court held that “Markaz” or “Mosque” would fall within the ambit of “rest house” or “boarding house” under para 16 (7) of the Foreigners (Amendment) Rules 2016 where these premises were found to be used as a ‘boarding house’ or a ‘rest house’ for foreigners and then by virtue of their use the keepers of such premises should be made responsible to comply with the requirements of reporting it to the local authorities.

Decision

 In the light of the above considerations, the Court held that the prosecution of foreign nationals for the offences alleged under Sections 14 and 14-C of the Act had no basis to proceed. Accordingly, the order taking cognizance and issuance of summons and also the entire criminal prosecution against them was quashed. However, it was further held that since the foreign nationals were staying in the ‘Markaz’ and the ‘Mosque’ respectively but the same was not reported to the authority competent by the management, a prima-facie case had been found to issue summons to petitioner 10 and 11 in Cr.W.J.C. No. 367 of 2020 and to petitioner 1 in Cr.W.J.C. No. 369 of 2020. Hence, the Court would not interfere with the impugned orders in so far as it relates to them.

The petition was disposed of with further directions to the State to deport these foreign nationals to their respective countries. [Enamul Hasan v. Union of India,    2020 SCC OnLine Pat 2708, decided on 22-12-2020]

Case BriefsSupreme Court Roundups

2020 has been a year of COVID-19, challenges, and changes. Of many things that this year has taught us, one of the biggest lessons has been our ability to work from home alone – but together! Like most of us, the Courts too took the cue and started functioning via video conferencing when the pandemic hit the World. At first, the Supreme Court restricted it’s functioning to avoid mass gatherings in Courts and directed that only urgent matters will be heard, however, soon all the in-person hearings were completely banned and the Court directed that it would hear “extremely urgent” matters via video conferencing.

Ultimately, faced with the unprecedented and extraordinary outbreak of a pandemic, Supreme Court issued guidelines on functioning of courts through video conferencing. It said that it was necessary that Courts at all levels respond to the call of social distancing and ensure that court premises do not contribute to the spread of virus.

Also read:

When the video conference hearings first began, the Courts and the public at large were skeptical about it’s success, however, the Supreme Court, in October, said that the “the system of Video Conferencing has been extremely successful in providing access to justice.” 

Read: SC says “system of Video Conferencing has been extremely successful”; alters only one guideline from April 6 order

Here are a few unmissable facts and stories from the highest Court of the country:

  • Even though most of the Court functioning took place online and through video conferencing, 696 judgments were delivered in the year 2020 .
  • All the Constitution bench verdicts were unanimous with no dissenting opinion. [Read more]
  • In a first, Single-Judge bench started hearing cases. [Read more]
  • A new dress code was notified for advocates in light of the COVID-19 pandemic. [Read more]
  • 228 advocates registered as Advocates-on-Record of the Supreme Court. [Read more]
  • 2 judges, Justice R. Banumathi and Justice Arun Mishra retired

Read:

Read: “Justice Ramana’s proximity with Mr. Chandrababu Naidu is too well-known”; Read what Andhra Pradesh CM Jagan Mohan Reddy wrote in his letter to CJI

Here’s a quick roundup of all the important Supreme Court judgments:

11 Constitution bench judgments 

  • All the Constitution bench verdicts were unanimous with no dissenting opinion.
  • 9 out of 11 Constitution bench judgments were delivered by benches consisting of Justices Arun Mishra, Indira Banerjee, Vineet Saran and M.R. Shah, followed by Justices Aniruddha Bose and S. Ravindra Bhat who were part of Constitution benches in 5 and 4 cases, respectively.

Read more…


Maintenance in matrimonial disputes| Extensive guidelines framed; Issue of overlapping jurisdiction under different Laws resolved

The bench ofIndu Malhotra and R. Subhash Reddy, JJ framed guidelines on overlapping jurisdiction under different enactments for payment of maintenance, payment of Interim Maintenance, the criteria for determining the quantum of maintenance, the date from which maintenance is to be awarded, and enforcement of orders of maintenance.

Read more…

Also read: Guidelines

[ Rajnesh v. Neha,  2020 SCC OnLine SC 903 ]


Appointments and functioning of Tribunals

A 3-judge bench issued extensive directions in relating to selection, appointment, tenure, conditions of service, etc. relating to various tribunals, 19 in number, thereby calling for certain modifications to the Tribunal, Appellate Tribunal and other Authorities [Qualification, Experience and Other Conditions of Service of Members] Rules, 2020.

“Dispensation of justice by the Tribunals can be effective only when they function independent of any executive control: this renders them credible and generates public confidence.”

Read more…

Also read: ‘It’s high time we put an end to the disturbing trend of Govt ignoring our directions.’ Read why Supreme Court directed constitution of National Tribunals Commission

[Madras Bar Association v. Union of India2020 SCC OnLine SC 962 ]


Constitutionality of imposition of GST on lotteries, betting and gambling

Lottery, betting and gambling are well known concepts and have been in practice in this country since before independence and were regulated and taxed by different legislations. When Act, 2017 defined the goods to include actionable claims and included only three categories of actionable claims, i.e., lottery, betting and gambling for purposes of levy of GST, it cannot be said that there was no rationale for including these three actionable claims for tax purposes.

Read more…

[Skill Lotto Solutions v. Union of India, 2020 SCC OnLine SC 990 ]


Homebuyer can choose between seeking remedy under the RERA Act or the Consumer Protection Act

The bench of UU Lalit and Vineet Saran, JJ held that the Real Estate (Regulation and Development) Act, 2016 (RERA Act) does not bar the initiation of proceedings by allottees against the builders under the Consumer Protection Act, 1986.

Read more… 

[Imperia Structures v. Anil Patni,  2020 SCC OnLine SC 894 ]


Domestic Violence| Wife’s right to residence in shared household belonging to not just husband but also to his relatives

“The domestic violence in this country is rampant and several women encounter violence in some form or the other or almost every day, however, it is the least reported form of cruel behavior. A woman resigns her fate to the never-ending cycle of enduring violence and discrimination as a daughter, a sister, a wife, a mother, a partner or a single woman in her lifetime.” 

Read more…

[Satish Chander Ahuja v. Sneha Ahuja, 2020 SCC OnLine SC 841 ]


Daughters’ coparcenary rights

The 3-judge bench of Arun Mishra, SA Nazeer and MR Shah, JJheld that daughters have right in coparcenary by birth and that it is not necessary that the father coparcener should be living when the Hindu Succession (Amendment) Act, 2005 came into force.

“The conferral of right is by birth, and the rights are given in the same manner with incidents of coparcenary as that of a son and she is treated as a coparcener in the same manner with the same rights as if she had been a son at the time of birth.”

Read more…

[ Vineeta Sharma v. Rakesh Sharma, (2020) 9 SCC 1 ]


Permanent commission to all women Army officers

The bench of Dr. DY Chandrachud and Ajay Rastogi, JJ has ordered that the permanent commission will apply to all women officers in the Indian Army in service, irrespective of their years of service.

“Underlying the statement that it is a “greater challenge” for women officers to meet the hazards of service “owing to their prolonged absence during pregnancy, motherhood and domestic obligations towards their children and families” is a strong stereotype which assumes that domestic obligations rest solely on women.”

Read more… 

[Ministry of Defence v. Babita Puniya, (2020) 7 SCC 469]


RBI’s ban on Cryptocurrency trading quashed

The 3-judge bench of Rohinton Fali Nariman, S Ravindra Bhat and V Ramasubramania, JJ has struck down the curb on trading in virtual currency, cryptocurrency and bitcoins in India.

In the 180 pages long verdict penned by Justice Ramasubramania, it was held,

“When the consistent stand of RBI is that they have not banned Virtual currencies (VCs) and when the Government of India is unable to take a call despite several committees coming up with several proposals including two draft bills, both of which advocated exactly opposite positions, it is not possible for us to hold that the impugned measure is proportionate.”

Read more…

[Internet & Mobile Assn. of India v. Reserve Bank of India, (2020) 10 SCC 274 ]


Installation of CCTV Cameras in all Police Station

The 3-judge bench of RF Nariman*, KM Joseph and Anirudhha Bose, JJ directed all the States and UTs to install CCTV cameras in all Police Stations and file compliance affidavits within 6 weeks. The Court said that the directions are in furtherance of the fundamental rights of each citizen of India guaranteed under Article 21 of the Constitution of India, and hence, the Executive/Administrative/police authorities are to implement this Order both in letter and in spirit as soon as possible.

Read more… 

[Paramvir Singh Saini v. Baljit Singh, 2020 SCC OnLine SC 983 ]


Automatic expiration of stay 

“Whatever stay has been granted by any court including the High Court automatically expires within a period of six months, and unless extension is granted for good reason, within the next six months, the trial Court is, on the expiry of the first period of six months, to set a date for the trial and go ahead with the same.” 

Read more…

[Also read detailed report on the 2018 verdict in Asian Resurfacing of Road Agency Pvt. Ltd. v. Central Bureau of Investigation, 2018 SCC OnLine SC 310,  here.]


Political parties to publish criminal antecedents of candidates & give reasons for their selection

A bench of RF Nariman and S. Ravindra Bhat, JJ directed all political parties to upload on their website details of pending criminal cases against candidates contesting polls, noting that there has been an alarming increase in criminalisation of politics. The Court said political parties will also have to upload reasons for selecting candidates with pending criminal cases on their website.

Read more… 

[Rambabu Singh Thakur v. Sunil Arora, (2020) 3 SCC 733 ]


SC/ST (Prevention of Atrocities) Amendment Act, 2018 constitutionally valid

 A 3-judge bench of Arun Mishra, Vineet Saran and S. Ravindra Bhat, JJ has upheld the constitutional validity of the SC/ST (Prevention of Atrocities) Amendment Act, 2018, and said that a court can grant anticipatory bail only in cases where a prima facie case is not made out. In the unanimous verdict, Justice Mishra penned the opinion for himself and Justice Saran whereas Justice Bhat wrote a separate but concurring opinion.

Read more… 

[Prathvi Raj Chauhan v. Union of India, (2020) 4 SCC 727 ]


Test for determining non-arbitrability of disputes

The 3-judge bench of NV Ramana*Sanjiv Khanna** and Krishna Murari, JJ overruled the ratio in Himangni Enterprises v. Kamaljeet Singh Ahluwalia, (2017) 10 SCC 706 wherein it was held that landlord-tenant disputes governed by the provisions of the Transfer of Property Act, 1882, are not arbitrable as this would be contrary to public policy.

Read more…

[Vidya Drolia v. Durga Trading Corporation, 2020 SCC OnLine SC 1018 ]


Admissibility of electronic evidence without certificate under Section 65B of Evidence Act, 1872

In a reference dealing with the interpretation of Section 65B of the Evidence Act, 1872 that deals with admissibility of electronic records, the 3-judge bench of RF Nariman, S. Ravindra Bhat and V. Ramasubramanian, JJ held that the certificate required under Section 65B(4) is a condition precedent to the admissibility of evidence by way of electronic record, as correctly held in by the 3-judge bench in Anvar P.V. v. P.K. Basheer, (2014) 10 SCC 473, and incorrectly “clarified” by a division bench in Shafhi Mohammad v. State of Himachal Pradesh, (2018) 2 SCC 801. The Court further clarified that the required certificate under Section 65B(4) is unnecessary if the original document itself is produced.

Read more…

[Arjun Panditrao Khotkar v. Kailash Kushanrao Gorantyal, (2020) 7 SCC 1 ]


Advance tax ruling system

The bench of SK Kaul and Indu Malhotra, JJ has recommended the Central Government to consider the efficacy of the advance tax ruling system and make it more comprehensive as a tool for settlement of disputes rather than battling it through different tiers, whether private or public sectors are involved. It suggested that a council for Advance Tax Ruling based on the Swedish model and the New Zealand system may be a possible way forward.

Writing two postscripts, the Court said that it was forced to do so on account of the backbreaking dockets which are ever increasing and as a move towards a trust between the Tax Department and the assessee.

Read more… 

[National Co-operative Development Corporation v. Commissioner of Income Tax, 2020 SCC OnLine SC 733 ]


Telecos get 10 years to pay AGR dues

Asking Telecom Operators to make the payment of 10% of the total AGR dues as by 31.3.2021, the 3-judge bench of Arun Mishra, SA Nazeer and MR Shah, JJ gave 10 years to the Telecom Service Providers (TSPs) to complete the payment of their AGR dues.

Read more…

[Union of India v. Assn. of Unified Telecom Service Providers of India, (2020) 9 SCC 748 ]


All petitions challenging the IBC provisions relating to personal guarantors transferred to Supreme Court

The Insolvency and Bankruptcy Code is at a nascent stage and it is better that the interpretation of the provisions of the Code is taken up by the Supreme Court to avoid any confusion.

Read more…

[Insolvency and Bankruptcy Board of India v. Lalit Kumar Jain,  2020 SCC OnLine SC 884 ]


The final order that sealed the fate for the Nirbhaya convicts

Putting the last nail in the coffin for the Nirbhaya death row convicts, the 3-judge bench of R. Banumathi, Ashok Bhushan and AS Bopanna, JJ dismissed the plea file by Pawan Kumar Gupta challenging the rejection of his mercy petition by the President on the ground that his plea of juvenility had not been finally determined and this aspect was not kept in view by the President of India while rejecting his mercy plea.

The hearing took place late at night at 2:30 AM.

Read more…

Also read:

[Pawan Kumar Gupta v. State of NCT of Delhi, 2020 SCC OnLine SC 340 ]


Shaheen Bagh Protests

“Democracy and dissent go hand in hand, but then the demonstrations expressing dissent have to be in designated places alone. The present case was not even one of protests taking place in an undesignated area, but was a blockage of a public way which caused grave inconvenience to commuters. We cannot accept the plea of the applicants that an indeterminable number of people can assemble whenever they choose to protest.” 

The 3-judge bench of SK Kaul, Aniruddha Bose and Krishna Murari, JJ has, in the Shaheen Bagh protests matter, held that while there exists the right to peaceful protest against a legislation, public ways and public spaces cannot be occupied in such a manner and that too indefinitely.

Read more…

[Amit Sahni v. Commissioner of Police, 2020 SCC OnLine SC 808 ]


Farmers’ protest

“Indeed the right to protest is part of a fundamental right and can as a matter of fact, be exercised subject to public order.”

Refusing to interfere with the ongoing Farmers’ protest, the 3-judge bench of SA Bobde, CJ and AS Bopanna and V. Ramasubramanian, JJ said that the farmers’ protest should be allowed to continue without impediment and without any breach of peace either by the protesters or the police.

Read more…

[Rakesh Vaishnav v. Union of India, 2020 SCC OnLine SC 1032 ]


Sushant Singh Rajput Death Case

When truth meets sunshine, justice will not prevail on the living alone but after Life’s fitful fever, now the departed will also sleep well. Satyameva Jayate.”

A single judge bench of Hrishikesh Roy, J has held the ongoing investigation by the CBI to be lawful and further directed that if any other case is registered on the death of the actor Sushant Singh Rajput and the surrounding circumstances of his unnatural death, the CBI is directed to investigate the new case as well.

Read more… 

[Rhea Chakraborty v. State of Bihar, 2020 SCC OnLine SC 654 ]


Scandalous allegations against Supreme Court judges

After finding advocates Vijay Kurle, Nilesh Ojha and Rashid Khan Pathan guilty of levelling scandalous allegations against Justice RF Nariman and Justice Vineet Saran, the bench of Deepak Gupta and Aniruddha Bose, JJ has sentenced all 3 to undergo simple imprisonment for a period of 3 months each with a fine of Rs. 2000/-. It further said that in default of payment of fine, each of the defaulting contemnors shall undergo further simple imprisonment for a period of 15 days.

Read: 

[Vijay Kurle, In re, 2020 SCC OnLine SC 407  and Rashid Khan Pathan v. Vijay Kurle, 2020 SCC OnLine SC 711]


Vikas Dubey Encounter

After Vikas Dubey, a history-sheeter and gangster-turned-politician, was killed in a police encounter on July 10, 2020, the Supreme Court gave a go ahead to Inquiry Committee headed by Former SC judge Justice B S Chauhan.

Later,  a 3-judge bench of SA Bobde, CJ and AS Bopanna and V. Ramasubramanian, JJ refused to scrap the Judicial Committee constituted to look into the killing of Vikas Dubey and said that the allegations of bias made against the members of the Commission merely on the basis of newspaper reports and nothing more, are liable to be rejected outright.

“ … the Chairman and a Member of the Commission had held high Constitutional positions and while making allegations the petitioner has based his claim only on the newspaper report and the manner in which the averments are made in the application is unacceptable.”

Read: 

[Ghanshyam Upadhyay v. State of Uttar Pradesh2020 SCC OnLine SC 587 and 2020 SCC OnLine SC 658 ]


Prashant Bhushan Contempt proceedings

Twitter row

The 3-judge bench of Arun Mishra, BR Gavai and Krishna Murari, JJ has, in a 108-pages long verdict, held advocate Prashant Bhushan guilty of criminal contempt in the suo motu contempt petition initiated against him after he criticised the Supreme Court and the sitting and former CJIs in a couple of tweets. It held,

The tweets which are based on the distorted facts, in our considered view, amount to committing of ‘criminal contempt’. 

The Court, however, sentenced Bhushan with a fine of Rupee 1 for his contemptuous tweets and said

“If we do not take cognizance of such conduct it will give a wrong message to the lawyers and litigants throughout the country. However, by showing magnanimity, instead of imposing any severe punishment, we are sentencing the contemnor with a nominal fine of  Re.1/­ (Rupee one).”

Read:

[Prashant Bhushan, In re, 2020 SCC OnLine SC 646 and  2020 SCC OnLine SC 698 ]

Tehelka contempt

In another contempt proceeding against Bhushan, after refusing to accept the explanation of advocate Prashant Bhushan in the 2009 contempt petition against Advocate Prashant Bhushan and former Tehelka Tarun Tejpal, the 3-judge bench of Arun Mishra, BR Gavai and MR Shah, JJ framed larger questions in the matter that will have far-reaching ramifications.

Read more… 

[Amicus Curiae v. Prashant Bhushan, 2020 SCC OnLine SC 651 ]


Kunal Kamra and Rachita Taneja contempt cases 

The 3-judge bench of Ashok Bhushan, R. Subhash Reddy and MR Shah, JJ issued notice to cartoonist Rachita Taneja and comedian Kunal Kamra in two separate cases relating contemptuous social media posts.

Read more…

[Shrirang Katneshwarkar v. Kunal Kamra2020 SCC OnLine SC 1041 and Aditya Kashyap v. Rachita Taneja, 2020 SCC OnLine SC 1042 ]


Here’s the list of some of the important COVID-19 Orders/Direction issued by the Supreme Court:

“Even if one survives from COVID-19, many times financially and economically he is finished.”

“To a worker who has faced the brunt of the pandemic and is currently laboring in a workplace without the luxury of physical distancing, economic dignity based on the rights available under the statute is the least that this Court can ensure them.” 


Also read:

2020 Roundup: 11 Constitution bench judgments, 17 judges, Zero dissent

 

High Courts

Delhi High Court: On 21st December, 2020, the Government of NCT of Delhi submitted in Court that elections of the School Management Committee (SMC) will be held within 2 months of school reopening. On 1st July, the Delhi Government had issued a circular by which SMCs were to be reconstituted through a draw of lots instead of elections right in the middle of the pandemic which was challenged by the petitioners as being opposed to the Right To Education Act. After the first hearing of this case, the Government issued a new circular (dated 16.07.20) adding information regarding tenure of  SMCs constituted by the draw of lots method. This information was missing from the impugned circular dated 01.07.20.  The new circular added that the SMCs constituted by the draw of lots method was only a ‘stop gap’ arrangement and elections to reconstitute SMCs would be held ‘after normalcy returns’. However, what ‘normalcy’ meant remained ambiguous.

Ms. Garima Sharma, the counsel appearing for the petitioners, pressed that the respondents commit to reconstitute the SMCs via elections within a fixed timeframe after school reopening. After seeking instructions from the Department of Education, the Government of NCT of Delhi, represented by Advocate Gautma Narayan, submitted that they will conduct elections to reconstitute SMCs within 2 months of school reopening. The same has been recorded in the order. The petitioners were satisfied with the submission made.  The bench of Navin Chawla, J. binding the respondents to the statement made disposed of the petition.

A SMC Meeting In Progress

This comes as a big relief to the petitioners who feared that the constitution of SMCs, by an opaque, exclusionary method such as draw of lots, if went unchallenged could become the norm and could take away the opportunity for parents to participate in choosing who will represent them in SMCs. SMCs are an important platform for parents to effect change inside a government school as they constitute 75% of the committee and SMCs have significant oversight and administrative roles and responsibilities.

[Indra v. Government of NCT of Delhi, Writ Petition (C) No. 4076 of 2020, dated 21-12-2020]

Click to access Note-On-The-Gaps-In-Current-SMC-Constitution-Ciricular_1-1.pdf


Nilufer Bhateja, Associate Editor has put this story together 

Also read: Delhi HC| Reconstitution of Delhi School Management Committees postponed till next hearing

Case BriefsCOVID 19Supreme Court

Supreme Court: Concerned with the COVID-19 pandemic spreading like a wild fire despite Guidelines and SOPs in place, the 3-judge bench of Ashok Bhushan, R. Subhash Reddy and MR Shah, JJ has said that a strict and stern action should be taken against those who are violating the Guidelines and SOPs, whoever he may be and whatever position the violator is occupying.

On 27.11.2020, the Court took suo motu cognizance of the incident which happened in Rajkot, Gujarat on 26.11.2020 resulting in death of COVID patients in the COVIDHospital. The Court also took notice of earlier incidents of fire in Covid Hospitals.

Stressing upon the right to health being a fundamental right guaranteed under Article 21 of the Constitution of India which includes affordable treatment, the Court said that either more provisions are to be made by the State Government and the local administration or there shall be cap on the fees charged by the private hospitals, which can be in exercise of the powers under the Disaster Management Act.

“It cannot be disputed that for whatever reasons the treatment has become costlier and costlier and it is not affordable to the common people at all. Even if one survives from COVID-19, many times financially and economically he is finished.”

Asking States to rise to the occasion, the Court said that every State must act vigilantly and to work with the Centre harmoniously.

Further, people should understand their duty and follow rules very strictly. It is the duty of every citizen to perform their fundamental duties as guaranteed under the Constitution of India.

“By not following the Guidelines/SOPs issued by the State from time to time, such as, not wearing the masks, not keeping social distances, to participate in the gatherings and the celebrations without maintaining social distances, they are ultimately not damaging themselves but they cause damage to the others also. They cannot be permitted to play with the lives of the others and they cannot be permitted to infringe the rights of other citizens, like right to health guaranteed under Article 21 of the Constitution of India.”

Calling for strict implementation of the SOPs and the guidelines issued from time to time, the Court reiterated the following measures:

i) More and more police personnel shall be deployed at the places where there is likelihood of gathering by the people, such as, Food Courts, Eateries, Vegetable Markets (Wholesale or Retail), sabzi Mandies, bus stations, railway stations, street vendors, etc.

ii) As far as possible, unless must, no permission shall be granted by the local administration or the Collector/DSP for celebration/gathering even during the day hours and wherever the permissions are granted, the local administration/DSP/Collector/Police In-charge of the local police station shall ensure the strict 7 compliance of the Guidelines/SOPs. There should be a mechanism to check the number of people attending such function/gathering, such as, the particulars with respect to how many persons are going to attend the celebration/gathering, timings during which the celebration/gathering is to take place etc.

iii) There shall be more and more testing and to declare the correct facts and figures. One must be transparent in number of testing and declaring the facts and figures of the persons who are Corona Positive. Otherwise, the people will be misled and they will be under impression that everything is all right and they will become negligent.

iv) Whenever directions are issued under the Disaster Management Act directing the corporate hospitals/private hospitals to keep 50% or any other percentage free municipal beds, it must be strictly complied with and there shall be constant vigilance and supervision.

v) There shall be free helpline numbers to redress the grievances of common man, when there is noncompliance of the directions by the private hospitals/corporate hospitals.

vi) Curfew on weekends/night be considered by States where it is not in place.

vii) In a micro containment zone or in an area where number of cases are on higher side, to cut the chain, they should be sealed and there should be complete lockdown so far as such areas are concerned. Such containment areas need to be sealed for few days except essential services. The same is required to break the chain of virus spread.

viii) Any decision to impose curfew and/or lockdown must be announced long in advance so that the people may know and make provisions for their livelihood, like ration etc.

ix) Another issue is a fatigue of front row health care officers, such as, Doctors, Nurses as well as workers. They are already exhausted physically and mentally due to tireless work for eight months. Some mechanism may be required to give them intermittent rest.

On the issue relating to gatherings organised by Political parties in light on upcoming elections in various States, the Court directed all the States / Union Territories to issue necessary directions to ensure compliance of guidelines for conduct of General Elections/Bye-Elections during Covid-19

The Court said that guidelines although were issued by General Election/Bye Election, can be implemented by different States with suitable modifications with reference to Elections of other organisations to ensure safety of people in general from Covid-19.

[IN RE: THE PROPER TREATMENT OF COVID 19 PATIENTS AND DIGNIFIED HANDLING OF DEAD BODIES IN THE HOSPITALS ETC., 2020 SCC OnLine SC 1036, order dated 18.12.2020]

Case BriefsCOVID 19Supreme Court

Supreme Court: The 3-judge bench of Ashok Bhushan, R. Subhash Reddy and MR Shah, JJ has directed that no State or Union Territory is required to paste posters outside the residence of COVID-19 positive persons, as of now. The State Governments and Union Territories can do so only when any direction is issued by the competent authority under the Disaster Management Act, 2005.

The direction came after a PIL was filed before the Court seeking an end to the practice of authorities affixing posters outside residences of Covid-19 positive persons who are under home isolation. The Petition further prayed that directions be issued to stop publishing the names of COVID-19 positive persons by the official of the Health Department in the States and Union Territories and also to stop freely circulating their names in welfare associations of colony and apartment complex which are serious violation of fundamental rights, right to privacy and right to live with dignity.

However, Solicitor General Tushar Mehta brought the Court’s attention to the guidelines dated 02.07.2020 and submitted that in the said guidelines which have been issued by the Government, Ministry of Health and Family Welfare for home isolation, there are no guidelines for pasting of posters outside the residence of COVID-19 positive persons. The letter issued by the Department of Family Welfare dated 19.11.2020 to Additional Chief Secretaries/Principal Secretaries/ Secretaries(Health) All States/UTs that the Government of India, Department of Health and Family Welfare, Ministry of Health and Family Welfare Guidelines also does not contain any instruction or guidance regarding affixing posters or other signage outside the residences of those found COVID-19 Positive.

“… neither any such direction has been issued by the Government of India nor it is obligatory to any State or Union Territory to paste the posters outside the residences of COVID-19 positive persons.”

[Kush Kalra v. Union of India, 2020 SCC OnLine SC 1017, decided on 09.12.2020]


*Justice Ashok Bhushan has penned this judgment

For petitioner: Advocate Chinmoy Pradip Sharma

For Respondent: Solicitor General Tushar Mehta

For NCT OF Delhi: Advocate Chirag M. Shroff

Case BriefsCOVID 19Supreme Court

Supreme Court: The 3-judge bench of L. Nageswara Rao, Hemant Gupta and Ajay Rastogi, JJ has issued directions to ensure education of children in Child Care Institutions which has suffered due to the COVID-19 pandemic.

Amicus Curiae Gaurav Agrawal suggested the Court that infrastructure available in the Child Care Institutions for providing education to children needs to be assessed. On the basis of the assessment of the infrastructure, Child Welfare Committees and the Juvenile Justice Boards through the District Child Protection Units shall inform the State Governments about the deficiencies in the infrastructure, stationary/books etc. It is necessary to ensure that extra classes should be held for children residing in Child Care institutions to make them holistically prepared to take the examinations in March-April, 2021.

Amicus Curiae also highlighted that State of Telangana is providing extra classes for children in Child Care Institutions. The other states should also follow the lead of the State of Telangana and ensure that such extra classes be provided for students/ the children restored to the families due to coronavirus pandemic.

“2,27,518 children were in the Child Care Institutions before the pandemic and 1,48,788 children have been restored to their families/guardians and other foster care homes, as a result of the pandemic. Educational needs of those children who have been handed over to their parents or guardians should be assessed. They might not have attended schools due to various reasons including the financial distress of the parents.”

Further, State of Tripura is following a practice of providing financial aid of Rs.2160 per month to the parents or guardians of the children who have been restored from the Child Care Institutions.

Taking note of the aforementioned submissions of the amicus curiae, the Court issued the following directions

  1. State governments to provide the necessary infrastructure, stationary, books, printers along with the other equipment that is necessary for children to quantitatively attend online classes on the basis of the recommendation made by the District Child Protection Units, within 30 days from the date of the order.
  2. State Government shall also ensure that the required number of tutors are made available for teaching the children in various Child Care Institutions. Extra classes, if necessary, should also be taken for the children to help them in preparing for the final examinations to be held next year.
  3. District Child Protection Units shall inform the District Legal Service Authorities about the progress made in the infrastructure being provided to the Child Care Institutions and the functioning of online classes periodically i.e. once in a month.
  4. District Child Protection Units to make an assessment of the children who are restored to their families or guardians or foster homes during the lockdown by taking the assistance of other statutory bodies like the Child Welfare Committees and Juvenile Justice Boards.
  5. District Child Protection Units to enquire about the financial position of the parents or guardians of the children. If it is found that the children are not being sent to school in view of the financial disability of their parents or guardians, the District Child Protection Units are directed to recommend to State governments to grant financial aid to the parents or guardians concerned. On such recommendation being made by the District Child Protection Units, the concerned authorities of the State governments are directed to release an amount of Rs.2000/- per month for each child, to the parents or guardians of the children in distress, which shall be used for the purpose of the education of the children.
  6. District Care Protection Units to ascertain the number of children who are restored to their families due to lockdown in a particular geographical locality and organize a guide or a teacher for each group of 25 children.

The Court will now hear the matter in February, 2021.

[IN RE: CONTAGION OF COVID 19 VIRUS IN CHILDREN PROTECTION HOMES, 2020 SCC OnLine SC 1026, order dated 15.12.2020]

Case BriefsCOVID 19Supreme Court

Supreme Court: The 3-judge bench of Ashok Bhushan*, R. Subhash Reddy and MR Shah, JJ has held that while the Homeopathic practitioners can prescribe medicines for COVID-19, neither them nor any other medical practitioner can claim that they can cure COVID-19.

The Court was hearing an appeal against the directions issued by the Kerala High Court to take actions against Homeopathic doctors, who prescribe any drug as a cure for COVID-19 disease should be proceeded with under the provisions of Disaster Management Act, 2005. The Court had held that Homeopathic doctors can only prescribe medicines as immunity booster.

The Supreme Court, however, took note of the advisory dated 06.03.2020 and the specific stand taken by the Ministry of AYUSH that Homeopathic medical practitioners are not confined to prescribe Homeopathic medicines only as immunity booster. It noticed that the Ministry of AYUSH specifically permits use of Homeopathy for following three ways:-

(i) Preventive and prophylactic;

(ii) Symptom management of COVID-19 like illness;

(iii) Add on interventions to the conventional care.

The Court further said that the Guidelines refer to Homeopathy medicines as medicines for prophylaxis, Amelioration and mitigation. The guidelines, however, specifically provides that “the prescription has to be given only by institutionally qualified practitioners”.

“When statutory regulations itself prohibit advertisement, there is no occasion for Homeopathic medical practitioners to advertise that they are competent to cure COVID-19 disease. When the Scientists of entire world are engaged in research to find out proper medicine/vaccine for COVID-19, there is no occasion for making any observation as contained in paragraph 14 with regard to Homeopathic medical practitioners. The homeopathy does not cure the disease, but it cures the patients.”

It, hence, held that the High Court in its impugned judgment has not fully comprehended the guidelines dated 06.03.2020 and taking a restricted view of the guidelines and have made observations for taking appropriate actions against the Homeopathic medical practitioners, which cannot be approved.

It was, however, noticed that the High Court was right in its observation that no medical practitioner can claim that it can cure COVID-19.

“There is no such claim in other therapy including allopathy. The High Court is right in observing that no claim for cure can be made in Homeopathy. The Homeopathy is contemplated to be used in preventing and mitigating COVID-19 as is reflected by the advisory and guidelines issued by the Ministry of AYUSH as noticed above.”

[Dr. AKB Sadbhavana Mission School of Homeo Pharmacy v. Secretary, Ministry of AYUSH, 2020 SCC OnLine SC 1022, decided on 15.12.2020]


*Justice Ashok Bhushan has penned this judgment.

For Appellant: Advocate Venkita Subramoniam,

For Respondent: Solicitor General of India Tushar Mehta

COVID 19Op EdsOP. ED.

1. INTRODUCTION

The on-going global Coronavirus disease (“COVID-19”) has affected a countless number of people around the world, businesses and the global economies alike. On March 11, 2020, the World Health Organisation declared COVID-19 a pandemic. In India too, the government has also termed COVID-19 as a pandemic. In testing times like these, India is slowly coming out of an unprecedented nationwide lockdown; which incidentally has been termed to be as one of the biggest lockdown in the world and has resulted in a temporary or partial shutdown of many businesses in India.

The Ministry of Home Affairs (“MHA“) along with various other relevant Indian governmental authorities to safeguard the interests of employees — ­particularly the inter-State migrant workers have come out with a series of notifications, advisories, circulars and orders (collectively referred to as  “the COVID Circulars”), many of which have cast onus on the ’employers’ and companies – whether they be in the industry or shops and commercial establishments,which (broadly) include but are not limited to the following:

(i) making payment of wages to their workers at their workplace, on the due date, without any deduction, for the period their establishments are or previously have been under closure during the lockdown (“MHA Circular”)[1]; and

(ii) ensuring fixed working hours and adequate safety of their employees[2], for the safety measures announced by the relevant governmental authorities, in light of the COVID-19 pandemic. ­

This article seeks to discuss in light of the COVID Circulars and keeping in view the ever-increasing popularity of the appointment of non-executive directors (“NED”) in Indian companies, whether such NEDs can be held liable for non-compliance of the obligations which the COVID Circulars have cast upon companies and employers.

2. ROLE OF NON-EXECUTIVE DIRECTORS WITH REGARD TO COVID CIRCULARS AND APPLICABLE INDIAN LEGISLATIONS  

2.1  Due to the ever-growing participation of private equity and venture capital investments by investors in Indian companies, as a recently evolving trend, such investors in return for their investments have been demanding a board seat of an authorised individual representative of their choice, usually by way of appointing a NED.

2.2 Obligations of Employers with Regard to the COVID Circulars

 As indicated above, several COVID Circulars have cast obligations on ’employers’, especially, when it comes to payment of wages to their workers employed at their workplace, during the period of lockdown. For instance, Labour Departments of States such as Maharashtra and Telangana had even prior to the MHA Circular, directed that during the lockdown period (which was announced by the said States before the nationwide lockdown was announced on March 24, 2020), the employees/workers were to be paid salary and allowances in full, as a paid holiday during such period. As on date, however, there is no clarification from the relevant governmental authorities as to whether a NED will constitute as an ’employer’ and hence, there remains ambiguity regarding whether a NED can be held accountable for any act of non-compliance by a company, in light of the COVID Circulars.

With no ‘explicit’ clarity on the issue of liability of a NED, with regard to COVID Circulars, as a stop-gap measure, guidance on the role and responsibilities, and general actions from the definitions, and cases which have dealt with the said issue in the past, interpretation can be drawn, in terms of the relevant Indian statutes, which include but are not limited to: (i) the  Companies Act, 2013[3] (“the Act”); and (ii) applicable provisions of the Indian labour legislations, which have been analysed (in brief) below.

2.3 Definition and analysis of a NED in line with the Act and the allied Rules made thereunder

 NEDs in India are viewed as a custodian of the company[4]. Under the Act, the liability in case of a default is cast upon the “officer who is in default”[5]. The question which has been repeatedly tested and challenged in the competent court(s) of law is whether a NED in a company can be equated on the same footing as an “officer who is in default”[6]. The extant law, provides a way out for the directors of a company including the NEDs, who can prove that any breach or non-compliance was not intentionaland neither was it an intentional breach by him/her, however, the burden to establish innocence would always lie on the NED. Additionally, the Act provides that a NED should be held liable only in respect of any contravention of any provisions of the Act which had taken place with his knowledge (attributable through board processes) and where he has not acted diligently, or with his consent or connivance[7], a fact which has been reiterated by the MCA, on numerous occasions[8].

To clear the ambiguity around the issue of liability of a NED, the Ministry of Corporate Affairs (“MCA”) had issued a circular[9] (“the Circular”), wherein it clarified that the liability of a NED (not being a promoter or KMP) under the Act, is only for the acts of omission or commission by a company which had occurred with his knowledge, attributable through the ‘board’ process, and with his connivance or where he had not acted diligently (“the Criteria”). The Circular further states that unless the Criteria is met, a NED (who is not a promoter or KMP), should not be arrayed in any criminal or civil proceedings under the Act. The Circular also discusses the need to examine the Criteria, before serving notices to the NED of a company, for a potential non-compliance and default by him/her.

The MCA, through the said Circular, has also prescribed SOPs (standard operating procedures) for the Registrars, before initiating proceedings against the ‘officers in default’, for offences which include but are not limited to ascertaining the nature of default and officer in default. The MCA has further clarified that in case of any doubts pertaining to the liability of any director for proceedings to be initiated, guidance may be sought from the office of the Director General of Corporate Affairs, MCA, and consequently, such proceedings must only be initiated after receiving due sanction from the MCA. Also note, only where lapse(s) are attributable to the decisions which are taken by the board or its committees which include the NED, adequate care and responsibility must be taken to ensure that unnecessary proceedings are not initiated against such NEDs unless there is evidence to the contrary.

2.4 Definition of ‘Employer’: Guidance from various Indian labour statutes

In light of the COVID-19 Circulars, it appears that most of the advisories seem to be directed towards “employers”, and the roles and responsibilities which would need to be followed during the lockdown. For instance, in light of the hardships faced by the inter-State migrant workers, the MHA Circular called upon all “employers”– whether in industry or in shops and commercial establishments, to make payment of wages of their workers at their workplace on the due date without any deduction in the wages during the lockdown period. On similar lines, relevant State Government authorities of various States, such as (i) Maharashtra; (ii) Uttar Pradesh; (iii) Haryana; and (iv) Karnataka, had issued advisories/orders on similar lines refraining employers from terminating their employees and workers, and/ or to reduce their wages.

As indicated at Point 2.2. above, since the COVID Circulars are silent on who an “employer” is, nor have the relevant governmental authoritiesas on date clarified on who would fall under the definition and ambit of an “employer”, in the interim reliance can be placed on the relevant provisions of the applicable Indian labour laws, where an “Employer” has been defined under various statutes.

For instance, Section 2(7) of the Bombay Shops and Establishment Act, 1948[10], defines an “employer” as a person who owns or has ultimate control over the affairs of an establishment, whereas Section 2(g) of the Industrial Disputes Act, 1947, defines an “employer” to be: ‘(i) in relation to an industry carried on by, or under the authority of any department of the Central Government or a State Government, the authority prescribed in this behalf, or where no authority is prescribed, the head of the department; (ii) in relation to an industry carried on, by or on behalf of a local authority, the chief executive officer of that authority’. Additionally, Section 2(l) of the Code on Wages, 2019, defines an “employer” as: “a person who employs, whether directly or through any person, one or more employees in his establishment”.

Hence, who would fall under the definition of an “employer” would depend on factors such as:

(i) the nature of the business;

(ii) the type of workers employed; and

(iii) the place of operations of a business or an establishment.

3. JUDICIAL PRECEDENTS AND SUBSEQUENT RELAXATIONS BY RELEVANT GOVERNMENTAL AUTHORITIES

3.1 Judicial Precedents

3.1.1 The question of liability of the NEDs has been challenged and discussed upon in the court of law, time and again. Listed below is a brief analysis of the important judicial precedents on this issue, in the recent past:

  • In Chaitan M. Maniar v. State of Maharashtra[11], the Bombay High Court observed that for the acts of a few dishonest people, the NEDs, who were not concerned with the day-to-day functioning of the company will not be held responsible, unless there is valid evidence backed by proof, to prove the active participation of the NEDs in question.
  • In Poonam Garg v. Securities and Exchange Board of India[12],  the appellant (i.e. Poonam Garg) acted in the capacity of a NED in the company and her husband was the promoter, managing director and the compliance officer in the company. The Securities Appellate Tribunal, Mumbai Bench after examining the merits of the case held that: (i) as the appellant’s (i.e. Poonam Garg) husband, was also a promoter/Managing Director/Compliance Officer of the company, the same was sufficient to hold that the appellant (i.e. Poonam Garg) was an ‘insider’ ; (ii) it could be deduced that she was reasonably privy to the PSI or ‘Price Sensitive Information’; (iii) it was not open to the appellant (i.e. Poonam Garg) to feign ignorance of the Prohibition of Insider Trade Regulations; and (iv) take shelter under the violations committed by her husband.
  • For cases pertaining to liability under the Negotiable Instruments Act, 1881, the Supreme Court of India in Pooja Ravinder Devidasani v. State of Maharashtra[13] held that: “a non-executive director is no doubt a custodian of the governance of the company but is not involved in day-to-day affairs of the running of its business and only monitors the executive activity”.

As can be seen from the cases cited above the courts usually examine the liability of a NED, individually on a case-to-case basis, and as such, there is no ‘one size fits all’ formula of the judicial tests, which the judicial courts, examine and has been laid down, to determine the liability of a NED.

3.1.2 Further, as discussed above, several COVID Circulars have imposed various obligations on the “employers” until a few relaxations by the relevant governmental authorities were announced[14]. Additionally, many COVID Circulars, such as the MHA Circular has been challenged by numerous aggrieved parties, before various courts having judicial jurisdiction, primarily on account of the inability of companies to pay wages during the period of lockdown. Listed below is a brief analysis of a few of such cases:

  • The Supreme Court of India in the matter of Hand Tools Manufacturers Association v. Union Of India[15], in its order stated that no coercive action was to be taken against an association of 52 (fifty-two) companies from Punjab for failing to comply with the MHA Circular, wherein the employers were compelled to pay wages to workers during the period of lockdown on account of COVID-19. The Hand Tools Manufacturers Association had challenged the constitutional validity of the Notification dated March 20, 2020, issued by the Secretary (Labour & Employment) and select portion of Clause III of the MHA Circular, both of which compelled payment of full wages to workers and employees during the period of lockdown.
  • The MHA Circular was also  challenged in  Ficus Pax Pvt.    v. Union of India[16], in the Supreme Court of India, wherein the appellant (Ficus Pax Pvt. Ltd. ) approached the Court to quash the MHA Circular directing payment of full wages to workers and employees during the lockdown as  “arbitrary, illegal, irrational, unreasonable and contrary to the provisions of law including Article 14 and Article 19(1)(g) of the Constitution of India.”

3.2  Subsequent relaxations by the relevant governmental authorities at the Central level

 There have been a few relaxations announced by the relevant governmental authorities with regard to the liabilities which the COVID Circulars have placed on the ’employers’.  For instance, the relevant governmental authority on the issue of ‘payment of wages’ to temporary/casual/daily wage workers in light of the lockdown, has clarified that the lockdown period is part of the moral/humanitarian/contractual obligations of all companies irrespective of whether they have any legal obligation for CSR contribution under Section 135 of the Companies Act, 2013, and hence, payment of wages to temporary or casual or daily wage workers during the lockdown period will not count towards CSR expenditure[17].

Additionally, the MHA has by way of issuing an order[18] dated May 17, 2020 (“New Order”) announced various relaxations, wherein the previously issued SOPs, including the MHA Circular, has now been replaced with new guidelines. This would mean that the restrictions which had been imposed by the MCA Circular pertaining to mandatory payment of wages, during the period of lockdown would with effect from May 18, 2020, no longer be applicable and as a result of this move, any termination measures or reduction in wages by an employer would be governed by applicable provisions of the Indian labour statutes.

As on date, however, there appears to be ambiguity regarding the New Order i.e. whether it would apply to establishments which were not operational previously during the period of lockdown, and unless the courts decide otherwise, companies including the employers would be bound by guidelines issued by the MHA Circular from its enforcement (i.e. March 29, 2020), until the day of enforcement of New Order (i.e. May 18, 2020). Additional relaxations in the form of the previously issued standard operating protocol (“SOP”) have been now replaced with the new lockdown guidelines, for instance, it is no longer mandatory for the employer to ensure that its employees have installed the ‘Arogya Setu’ app but the same is to be done by the employer on a ‘best effort basis’ only.

3.3. Subsequent Relaxations by Various State Governments

In light of the COVID-19 pandemic, many State Governments have also provided a few relaxations in the compliance requirement for a few of the applicable labour laws, as a result of which the onus on the part of the employers or the “officer in charge” which may include NEDs by virtue of the role played by them in the company has significantly been reduced. For instance, the State of Uttar Pradesh provided relaxations to the “employers”, by way of issuing an Ordinance[19], in complying with certain requirements of the applicable legislation, such as exemptions from complying with the provisions of the Industrial Disputes Act, 1947 (“IDA”) and the Factories Act, 1948 for 3 (three) years, starting from the date of the said Ordinance.

4. CONCLUSION

4.1 To conclude and to answer whether a NED can be held liable for any non-compliance in light of the  COVID Circulars, the following points provide an overview of the issue:

(i) As discussed above, as on the date of this article, there is no explicit clarity from the relevant governmental authorities, regarding whether a NED would fall under the definition of an “employer”. Hence, the liability of a NED, would need to be determined individually and on a case to case basis, till the time further clarity by a relevant governmental authority is provided.

(ii) In the interim, guidance can be drawn to applicable provisions of the Indian legislations, as discussed in line at Points 2.3 and 2.4 of this article (i.e. the definition of NED and definition of an ’employer’).

(iii) Several petitions challenging the legality of the COVID Circulars, have been filed by affected parties, many of which are still pending to be adjudicated upon by the courts, and are likely to be answered in the coming few days.

4.2 In the interim, in light of the COVID Circulars, to better protect the interest of the NEDs, the following measures should ideally be adopted by the companies:

(i) Obtaining a D&O (director and officer) insurance to better protect the interests of NEDs in a company;

(ii) Indemnification rights as part of the definitive agreements to protect the rights of the NED should be sought by the investors wanting to appoint a NED (i.e. in the form of their representative on the board of a company);

(iii) Clear demarcation of the roles and responsibilities of a NED in the company should be ideally defined and documented; and

(iv) As a stop-gap arrangement, companies may choose to nominate an individual/group of individuals (which may also include NEDs), to oversee the compliance requirements, including the requirements stemming from the COVID Circulars. This may however not be a fool-proof method to safeguard the interest of NEDs, as different courts, may take a different view on this.

4.3 In continuation to recommendations discussed at Point 4.2 above, NEDs may also make a recommendation to the KMPs or the members of the board of directors (as the case may be) and ensure that the employees are paid their wages on time – in line with the advisories issued by the relevant governmental authorities from time-to-time, and further, written consent of employees stating that the company is complying with the norms laid down by the relevant governmental agencies can be obtained, to protect the interests of the NEDs in a company.


*Lawyer from New Delhi/Mumbai, India. Author can be reached at ‘aseem.sahni@outlook.com’.

[Disclaimer: The content of this article is intended to provide a general guide to the subject. Specialist advice should be sought about your specific circumstances.]

[1] Refer to Order issued by the Ministry of Home Affairs – No. 40-3/ 2020- DM-I (A), dated March 29, 2020.

[2]MHA in its directive issued on May 1, 2020 had made installation of ‘AarogyaSetu’ App mandatory for both private and public sector employees and had called upon the head of the respective organisations to ensure 100 per cent coverage of the app among the employees.

[3] The Companies Act, 2013

[4] Chintalapati Srinivasa Raju  v. Securities and Exchange Board of India, (2018) 7 SCC  443, dated May 14, 2018.

[5] Section 2(60) of the Act defines an “Officer who is in default” and provides a list of officers of a company, who will be held accountable in case of default by the company, which include but are not limited to: (i) whole-time director; (ii) key managerial personnel; or (iii) any person in accordance with whose advice, directions or instructions, the board of directors of the company is accustomed to act, other than a person who gives advice to the board of directors in a professional capacity.

[6]Please refer to Point 3.1 of this article, for a discussion on an overview of the judicial interpretation.

[7]Section 149(12) of the Companies Act, 2013.

[8]Refer to ‘Report of Expert Committee’, available at:http://www.mca.gov.in/Ministry/reportonexpertcommitte/chapter4.html (last visited on May 24, 2020).

[9]Refer to General Circular No. 1 / 2020 (F.No. 16/1/2020-Legal) dated March 2, 2020.

[10]Also referred to as the Maharashtra Shops and Establishment Act, 1948.

[11]2004 SCC OnLine Bom 139

[12]  2018 SCC Online SAT 99.

[13] (2014) 16 SCC  1 

[14]Brief analysis of the relaxations announced by the various relevant governmental authorities in light of the COVID Circulars has been discussed at Point(s) 3.2 and 3.3 of this article.

[15]Writ Petition (Civil) Diary No. 11193/2020, order dated 15-5-2020.

[16] (2020) 4 SCC 810

[17]Ministry of Corporate Affairs  General Circular No. 15/2020 (F. No. CSR-01/4/2020-CSR-MCA), ‘COVID-19 related Frequently Asked Questions (FAQ No. 6) on Corporate Social Responsibility (CSR)’ dated April 10, 2020.

[18]Refer to order issued by the Ministry of Home Affairs – No. 40-3/2020-DM-I(A) – dated May 17, 2020, available at https://www.mha.gov.in/sites/default/files/MHAOrderextension_1752020_0.pdf

[19]Refer to Ordinance entitled “Uttar Pradesh Temporary Exemption from Certain Labour Laws Ordinance, 2020”, dated May 08, 2020. It has since been withdrawn.

COVID 19Hot Off The PressNews

Justice G.R. Udhwani

Justice G.R. Udhwani of Gujarat High Court passed away while undergoing treatment for Coronavirus (COVID-19).

[Source: PTI]

BACKGROUND

Born on 25-11-1961 at Ahmedabad in the family of a businessman. Graduated in B.Com from Navgujarat Mahavidhyalaya, Ahmedabad in 1983. Obtained Law Degree from Sir L.A. Shah Law College, Ahmedabad in the year 1986. Was enrolled as an Advocate with Bar Council of Gujarat on 30-06-1987.

Joined the legal profession in 1987 in the High Court of Gujarat. Practised in the High Court of Gujarat in all fields of law i.e. Company Matters, Labour Matters, Industrial Matters, Service Matters, Constitutional Matters, Civil and Criminal Matters. Appointed as Judge in City Civil Court at Ahmedabad on 12-02-1997. Was appointed as Additional Judge, Special Court (POTA) on 18-10-2003. Was appointed as Law Officer on 22-07-2004, which was redesignated as Registrar (Legal) on 01-11-2004 in the High Court of Gujarat. Was repatriated to the State Judiciary as Judge, City Civil Court, Ahmedabad on 13-07-2007. Was appointed as Registrar (Infrastructure & Information Technology) on 18-05-2010 in the High Court of Gujarat. Worked as Incharge Registrar General, High Court of Gujarat from 17-02-2011 to 19-06-2011. Was appointed as Registrar General, High Court of Gujarat from 20-06-2011 to 11-11-2012.

His Lordship was elevated as an Additional Judge, High Court of Gujarat on 12-11-2012 and confirmed as Permanent Judge on 10-07-2014.