Case BriefsHigh Courts

Telangana High Court: P. Naveen Rao J., while dismissing the present petition, reiterated that the scope of interference under Article 226 is restricted and cannot be put to action where an alternate remedy is available under the concerned statute.

The present writ petition was filed alleging that even though a cognizable crime was reported on 03-11-2020, no crime was registered by the concerned police authority.

Court reiterating the position in such cases, said, “If the petitioner had grievance against non-registration of crime, he has an effective and efficacious remedy under the Criminal Procedure Code. Therefore, petitioner has to avail the remedy as available in law before invoking the jurisdiction of this Court.”

 Reliance was placed on, Sakiri Vasu v. State of U.P., (2008) 2 SCC 409, where the Supreme Court said, “In our opinion Section 156(3) CrPC is wide enough to include all such powers in a Magistrate which are necessary for ensuring a proper investigation, and it includes the power to order registration of an FIR and of ordering a proper investigation if the Magistrate is satisfied that a proper investigation has not been done, or is not being done by the police. Section 156(3) CrPC, though briefly worded, in our opinion, is very wide and it will include all such incidental powers as are necessary for ensuring a proper investigation”

 Following the above law, present petition stood dismissed granting liberty to the petitioner to work out his remedies as available in law on the issue of non-registration of crime stated to have been reported on 03-11-2020.[Masuna Satheesh Kumar v. State of Telangana, WP No. 174 of 2021, decided on 06-01-2021]


Sakshi Shukla, Editorial Assistant has put this story together

Case BriefsHigh Courts

Bombay High Court: The Division Bench of Dipankar Datta, CJ and G.S. Kulkarni, J., while addressing the several questions on reporting by electronic media, expressed that:

“The duty of the press/media to have news items printed/telecast based on true and correct version relating to incidents worth reporting accurately and without any distortion/embellishment as well as without taking sides, cannot, therefore, be overemphasized.”

Genesis of the Several Public Interest Litigations

In the instant matter, several PIL’s cropped from the unnatural death of the actor Sushant Singh Rajput on June 14, 2020.

Insensitive and Disparaging Comments by News Channels

On June 20, 2020, a complaint was lodged against one of the prominent news channels before the Secretary, Ministry of Information and Broadcasting seeking action for insensitive and disparaging comments against the Indian Army and the coverage of the death of the actor, stated to be in defiance with the Programme Code.

Further, it was said that no action against the media channel was taken in regard to the complaint made.

Media Trials

Since the time of death of the actor, several prominent media channels have been literally conducting ‘media trials’ and ‘parallel investigation’ by conducting and broadcasting debates, rendering opinions, exposing the material witnesses, examining and cross-examining the witnesses, chasing the officials of CBI who were investigating the case.

Petitioners added that the above-stated telecast and broadcast are available in the public domain.

Sensationalization and Scandalize the death of the Actor

It is said that the prominent news channels in their attempt to sensationalize the issues have gone as far as displaying the CDR records which is a vital piece of evidence, thereby resulting in the several threat calls and messages sent to the alleged accused.

The petitioners say that to scandalize and sensationalize the death of the actor, irresponsible reporting to implicate one of the prominent ministers of the State of Maharashtra and have been making derogatory, false and distasteful remarks against several ministers.

Further, it was also pointed that the news anchors and reporters were examining and cross-examining all the proposed witnesses exposing the probable evidence to the public which could be examined only by the investigating agency or by the competent courts during the course of the trial.

Press Council of India

PCI had also issued a statement wherein it was stated that the coverage of the alleged suicide of the actor by many media outlets was in contravention of the norms of journalistic conduct.

Undermining the concept of free and fair trial

Petitioners submitted that the freedom of the media, especially of the TV channels, cannot be allowed to super stretch to a point where, by outpouring reprobate information, begins to clog and cloud the pellucid comprehension of ‘facts/news’ in the people’s minds and impinges upon free and fair investigation.

Fundamental Question

Whether the media under the garb of reporting news, can serve their own opinions as facts/news?

Petitioner observed that media works to create or induce opinions by narrating and reporting opinionated and tailored facts as news, which is beyond the scope, power and privilege accorded to the proverbial fourth pillar and a blatant abuse and misuse thereof.

Petitioners assert that media is plagued with the affliction of disproportionate reporting, which may be seen from the undue coverage given to inconsequential and mindless matters, unrelated to the greater good of the people of the country, as opposed to issues of national and international importance which the people are grappling with such as the COVID 19 crisis, mass joblessness, economic downfall, starvation, medical and healthcare structural problems, farmers issues, domestic violence, etc.

Adding to the above, petitioners stated that it is not the media’s domain to prove someone guilty a definitely no question of calling out someone guilty or innocent until the investigation and trial is complete.

Petitioners referred to the Supreme Court decision in Manu Sharma v. State (NCT of Delhi), (2010) 6 SCC 1, wherein the Supreme Court has commented on the danger of serious risk of prejudice if the media exercises unrestricted and unregulated freedom, and stated that people at the helm of affairs should ensure that trial by media does not hamper fair investigation by the investigating agency and more importantly does not prejudice the right of defence of the accused in any manner whatsoever.

Petitioners refer to the decision of the Supreme Court in R.K. Anand v. Delhi High Court, reported in (2009) 8 SCC 106, where the Supreme Court observed that it would be a sad day for the court to employ the media for setting its own house in order and the media too would not relish the role of being the snoopers of the court.

Observation

Contention that media houses have crossed the ‘Lakshman Rekha’

Bench opined that the petitions filed aimed at redressal of genuine public harm or public injury and involve substantial public interest.

Hence, the Court overruled the objections of the media houses to the maintainability of the writ petitions.

Important Legal Questions before the Court

  1. What does the expression “administration of justice in any other manner” in Section 2(c)(iii) of the Contempt of Courts Act, 1971 connote, and whether trial by media/pre-judgment while a police investigation is in progress could lead to interference with/obstruction to “administration of justice”, thereby constituting criminal contempt under the aforesaid section?
  2. Is it necessary to construe “judicial proceedings” in Section 3 of the Contempt of Courts Act, 1971 to have commenced with the registration of an FIR? Also, is it at all necessary to read Section 3 of the Contempt of Courts Act, 1971 in the manner the petitioner in PIL (St.) 2339 of 2020 urges us to read?
  3. Whether media trial in respect of matters pending investigation of a criminal complaint, fall within the restrictions as contained in the Programme Code as postulated under Section 5 of the Cable Television Networks (Regulation) Act, 1995 and the rules framed thereunder?
  4. Whether the regime of self-regulation adopted by the news channels would have any sanctity within the statutory framework?
  5. While emphasizing on the need to strike the right balance between freedom of speech and expression and fair investigation/right to fair trial, to what extent, if at all, should press/media reporting be regulated if the same interferes with or tends to interfere with, or obstructs or tends to obstruct, “administration of justice”?

Further, the Court also proposes to address the following incidental questions:

  1. Are the guidelines for reporting cases of deaths by suicide sufficient? If insufficient, should further guidelines be laid down for reporting cases of deaths by suicide?
  2. Has the media coverage complained of in these writ petitions interfered with/obstructed and/or tends to interfere with/obstruct “administration of justice”, and thus amounts to criminal contempt within the meaning of section 2(c)(iii) of the Contempt of Courts Act, 1971? and whether criticism of Mumbai Police by the electronic media is fair?
  3. Is the accusation that the Ministry of Information and Broadcasting, Government of India, being the Nodal Ministry, has abdicated its statutory functions [under the Cable Television Networks (Regulation) Act and the rules framed thereunder read with the Policy Guidelines of 2011 and the license executed with the broadcaster] of deciding complaints received in respect of offending programmes, by forwarding the same to private bodies like the News Broadcasting Authority (NBA) and the News Broadcasters Federation (NBF), justified?
  4. Should an order be made, on facts and in the circumstances, postponing reporting of events by the media in respect of investigation by the CBI into the FIR registered by it pursuant to the complaint of the actor’s father? Also, is it necessary for the Court to suggest measures for regulating media coverage of incidents such as the one under consideration to address the concerns expressed in these writ petitions?

Analysis

  • Investigative Journalism

The controversy in the instant matter raises questions of contemporary importance touching upon the right of the press/media to express views freely, the right of the deceased to be treated with respect and dignity after death, the need to ensure investigation of the crime to proceed on the right track without being unduly prejudiced by media reports based on “investigative journalism”, and the right of the accused to a free and fair trial as well as the right to not be prejudged by the media.

“Right guaranteed by Article 19(1)(a) of the Constitution is not merely a right of speech and expression but a right to freedom of speech and expression.”

 In Supreme Court’s decision of Indian Express Newspapers (Bombay) (P) Ltd. v. Union of India, (1985) 1 SCC 641 the need to protect the ‘Freedom of Press’ was highlighted, which is the heart of social and political intercourse.

Further, the Court referred to in LIC v. Manubhai D. Shah (Prof.), (1992) 3 SCC 637, wherein the flavour of the right to freedom of free speech and expression was brought out by the Supreme Court.

 “What resonates in our ears now is whether the right guaranteed under Article 19(1)(a) is the most abused right in recent times?”

 To the above stated, Court answered in negative and expressed that “it is a reminder of what has at times been the unsavoury past of the press/media in India crossing the proverbial ‘Lakshman Rekha’.”

Rule of Law

There can be no two opinions that in a society governed by the rule of law, no price is too high to maintain the purity of administration of justice; and, as a Constitutional court, we have the power, nay the duty, to protect not only the Fundamental Rights of the citizens as well as the press/media in the judicious exercise of our jurisdiction under Article 226 of the Constitution but also to secure that the stream of administration of justice flows unsullied and unpolluted, uninfluenced by extraneous considerations.

 Supreme Court’s decision in Harijai Singh, In Re., (1996) 6 SCC 466 held that:

“10. But it has to be remembered that this freedom of press is not absolute, unlimited and unfettered at all times and in all circumstances as giving unrestricted freedom of speech and expression would amount to an uncontrolled licence. If it were wholly free even from reasonable restraints it would lead to disorder and anarchy. The freedom is not to be misunderstood as to be a press free to disregard its duty to be responsible. In fact, the element of responsibility must be present in the conscience of the journalists.”

PCI Guidelines

Electronic media should also be guided by the contents of the guidelines of the PCI on reporting of death cases by suicide for two reasons: first, the said guidelines have a statutory flavour and similar such binding guidelines on reporting cases of death by suicide are non-existent for the electronic media; and secondly, the absence of such guidelines could lead to the dignity of the dead being breached with impunity.

The death of the actor was followed by such crude, indecent and distasteful news reporting by a few of the TV channels that we do not consider it worthy of being referred to here and be a part of this judgment.

Court’s Ruling

“No report/discussion/debate/ interview should be presented by the press/media which could harm the interests of the accused being investigated or a witness in the case or any such person who may be relevant for any investigation, with a view to satiate the thirst of stealing a march over competitors in the field of reporting.”

High Court opined that the press/media ought to avoid/regulate certain reports/discussions/debates/interviews in respect of and/or touching upon any on-going inquiry/investigation into a criminal offence.

Hence, Bench directed the press/ media to exercise restraint and refrain from printing/displaying any news item and/or initiating any discussion/debate/interview of nature, as indicated hereunder:

  1. In relation to death by suicide, depicting the deceased as one having a weak character or intruding in any manner on the privacy of the deceased;
  2. That causes prejudice to an ongoing inquiry/investigation by:

(i)  Referring to the character of the accused/victim and creating an atmosphere of prejudice for both;

(ii)  Holding interviews with the victim, the witnesses and/or any of their family members and displaying it on screen;

(iii)  Analyzing versions of witnesses, whose evidence could be vital at the stage of trial;

(iv)  Publishing a confession allegedly made to a police officer by an accused and trying to make the public believe that the same is a piece of evidence which is admissible before a Court and there is no reason for the Court not to act upon it, without letting the public know the nitty-gritty of the Evidence Act, 1872;

(v)  Printing photographs of an accused and thereby facilitating his identification;

(vi)  Criticizing the investigative agency based on half-baked information without proper research;

(vii)  Pronouncing on the merits of the case, including pre-judging the guilt or innocence qua an accused or an individual not yet wanted in a case, as the case may be;

(viii)  Recreating/reconstructing a crime scene and depicting how the accused committed the crime;

(ix)  Predicting the proposed/future course of action including steps that ought to be taken in a particular direction to complete the investigation; and

(x)  Leaking sensitive and confidential information from materials collected by the investigating agency;

  1. Acting in any manner so as to violate the provisions of the Programme Code as prescribed under section 5 of the CTVN Act read with rule 6 of the CTVN Rules and thereby inviting contempt of court; and
  2. Indulging in character assassination of any individual and thereby mar his reputation.

Role of Media Houses

Bench advised media houses to inform, guide and advise the guest speakers to refrain from making public utterances which are likely to interfere with and/or obstruct the administration of justice and thereby attract contempt.

The role of the anchor, in such cases, is also important. It is for him/her to apply his/her mind and avoid the programme from drifting beyond the permissible limits. Muting the speaker if he flies off or shows the tendency of flying off at a tangent could be one of several ways to avoid embarrassment as well as contempt.

Investigative Agencies

Court also reminded the investigative agencies that they are entitled to maintain secrecy in the course of the investigation and are under no obligation to divulge materials thus collected.

Further, the Court added that:

If indeed there is leakage or disclosure of materials, which has the potential of stifling a proper investigation, it could pave the way for such information being laid before the competent court having powers to punish for cri6minal contempt under Section 2(c) of the CoC Act and in an appropriate case, for being dealt with in accordance with law.

Appointment of an Officer as a Link between the Investigator and Media Houses

Agreeing with Mr Datar’s suggestion Court observed that:

Mumbai Police, as well as the other investigating agencies, may consider the desirability of appointing an officer who could be the link between the investigator and the media houses for holding periodic briefings in sensitive cases or incidents that are likely to affect the public at large and to provide credible information to the extent such officer considers fit and proper to disclose and answer queries as received from the journalists/reporters but he must, at all times, take care to ensure that secret and confidential information/material collected during the investigation, the disclosure whereof could affect the administration of justice, is not divulged.

In case an officer as stated above would be appointed, he would be expected to bear in mind the Supreme Court’s decision in Rajendran Chingaraveluv. R.K. Mishra, (2010) 1 SCC 457.

“Every journalist/reporter has an overriding duty to the society of educating the masses with fair, accurate, trustworthy and responsible reports relating to reportable events/incidents and above all to the standards of his/her profession. Thus, the temptation to sensationalize should be resisted.”

Therefore, in light of the above discussions, the Court disposed of the PIL’s filed.[Nilesh Navalakha v. Union of India, PIL (ST) No. 92252 of 2020, decided on 18-01-2021]


Advocates for the Parties:

Mr. Devadatt Kamat, Senior Advocate a/w Mr. Rajesh Inamdar with Mr.Shashwat Anand, Mr. Pankaj Kandhari, Ms. Smita Pandey, Mr.Amit Pai, Mr. Vishal Jagwani, Kevin Gala, Siddharth Naik, Pinky Chainani, Mr. Ankur Azad, Mr. Sarveshwari Prasad, Mr. Rahat Bansal, Mr. Faiz Ahmad. i/b Mr. Pankaj Kandhari for Petitioners.

Mr. Anil Singh, Additional Solicitor General a/w Mr. Sandesh Patil, Mr.Aditya Thakkar, Mr.Amogh Singh, Ms. Apurva Gute, Mr. Chintan, Mr. Mayur Prashant Rane, Mr. Sumedh Sahakari, Mr. D. P. Singh, Ms.Reshma Ravapati, Mr. Saurabh Prabhulkar and Medvita Trivedi for respondent Nos.1, 4, 12 and 13.

Mr. Arvind Datar, Senior Advocate i/by Mr. Bharat Manghani for respondent 3 (NBA)

Mr. P. P. Kakade, Govt. Pleader with Mrs. R. A. Salunkhe, AGP for respondent 5 -State.

Mr. Rajeev Pandey with Mr. Madhur Rai i/by PRS Legal for respondent No.6(The India Today Group).

Mr. Kunal Tandon a/w Ms. Prachi Pandya i/by Corporate Attorneys for respondent No.7 (Times Now).

Ms. Malvika Trivdei a/w Mr. Saket Shukla, Mr. Vasanth Rajshekharan, Mr. Mrinal Ojha, Mr. Debashri Datta, Mr.Rajat Pradhan, Ms. Madhavi Joshi and Mr. Siddhant Kumar i/by Phoenix Legal for respondent 8 (Republic TV).

Mr. Angad Dugal, Mr. Govind Singh Grewal, Shiva Kumar, Tanya Vershney, Raj Surana a/w Rishi Murarka for respondent 9 (NDTV Ltd.).

None for respondent  10 (News 18).

Mr. Ankit Lohiya a/w Mr. Hetal Thakore, Mr. Kunal Parekh, Ms. Bhavika Tiwari i/by Dua Associates AOR Mumbai for respondent 11 (Zee News).

Ms. Hetal Jobhanputra for respondent No. 14 (ABP News).

Mr. Jayant Mehta a/w Mr. Alankar Kirpekar a/w Mr. Tejveer Bhatia, Mr. Rohan Swarop, Mr. Shekhar Bhagat i/by MAG Legal for respondent 15 (India TV).

Mr. Siddhesh Bhole, Mr. Rishabh Dhanuka i/by Alba Law Offices for respondent No. 16 (News Nation).

Mr. Siddharth Bhatnagar, Senior Advocate a/w Mr. Pralhad Paranjape for respondent No. 17 (NBF).

Case BriefsHigh Courts

Sikkim High Court: Meenakshi Madan Rai, J., while allowing the application made for the amendment of pleadings, held “The proposed amendment, in my considered opinion, in no manner causes any prejudice to the answering Respondent neither does it change the nature and character of the Petition or the reliefs sought.”

Counsel for the petitioner submitted that the amendment sought in the present application is necessary for the purpose of determining the real question in controversy and further placed reliance on the case of Estralla Rubber v. Dass Estate (P) Ltd, (2001) 8 SCC 97. Objecting the same, Advocate General submitted that after the repatriation order was issued by the Government the Petitioner has joined his original Department, that is, Education Department, and consequently nothing further remains for adjudication in the matter. However, if this Court be inclined to allow the amendment it should not prejudice the rights of the Respondent to take up the grounds of waiver and acquiescence at the hearing. To substantiate his submission, Advocate General relied on P.S. Gopinathan v. State of Kerala, (2008) 7 SCC 70.

Taking into consideration the due submissions, the Court allowed the application seeking amendment, reiterating that unless the amendment sought affects the right vested with the opposite party, the same shall be allowed provided there was no opportunity of raising it at an earlier stage.[Santosh Dong v. State of Sikkim, WP (C) No. 20 of 2019, decided on 10-12-2020]


Sakshi Shukla, Editorial Assistant has put this story together

Case BriefsHigh Courts

Punjab and Haryana High Court: In an interesting case regarding regular bail, Jaishree Thakur, J., held that WhatsApp messages do not have any evidentiary value in the absence of certificate under Section 65B of Evidence Act, 1872.

On receipt of secret information that two consignments contained contraband, the Narcotics Bureau, Headquarters, Chandigarh arrived at the Regional Office of DTDC Courier Agency and called one Paramjit Kaur (consignor of the parcels), who confirmed that she had booked the parcels herself, on being asked by the petitioner to do so. The consignments contained contraband of Tramadol Hydrochloride 100 mg (Trade Name Clovidol-100 SR), 57,000 tablets which were of commercial quantity. Counsel for the petitioner, R.S. Rai submitted that Narcotics Bureau was relying upon the statement given by a co-accused implicating the petitioner. It was contended that the said disclosure statement could not be relied upon nor can any statement made by him in the judicial custody be relied upon as incriminating evidence against him. Reliance was placed by the petitioner on Tofan Singh v. State of Tamil Nadu, (2013) 16 SCC 31, wherein the Supreme Court dealt with the question,

Whether an officer “empowered under Section 42 of the NDPS Act” and/or “the officer empowered under Section 53 of the NDPS Act” are “Police Officers” and therefore, statements recorded by such officers would be hit by Section 25 of the Evidence Act? The supreme Court, while answering the abovementioned question had held, “a confessional statement made before an officer designated under Section 42 or Section 53 can be the basis to convict a person under the NDPS Act, without any non obstante clause doing away with Section 25 of the Evidence Act, and without any safeguards, would be a direct infringement of the constitutional guarantees contained in Articles 14, 20 (3) and 21 of the Constitution of India.’’

 The respondent submitted that there were screen shots of Whatsapp messages available with it, which would connect the petitioner with the said contraband, as there was a message available showing transfer of an amount by the petitioner into the account of Harjinder Singh, husband of Paramjit Kaur.

The Court stated that complicity of the petitioner would have to be determined by the quality of evidence led during trial. The Narcotics Bureau was relying not only upon the statement given by a co-accused implicating the petitioner but also upon some screenshots of whatsapp messages. It was observed that ratio, as laid down in Tofan Singh’s case, would come to the aid of the petitioner to allow him the benefit of regular bail. The Court, while relying on Arjun Panditrao Khotkar v. Kailash Kushanrao Gorantyal, (2020) 7 SCC 1, held, a certificate Section 65B of the Indian Evidence Act is required when reliance is being placed upon electronic record. Therefore, the said message would be of no evidentiary value as on date.”  Hence, the petitioner was granted bail on execution of adequate personal/surety bond of an amount of Rs.10 Lakhs. [Rakesh Kumar Singla v. Union of India, CRM-M No.23220 of 2020 (O&M), decided on 14-01-2021]

Cases ReportedSupreme Court Cases

Income Tax — Income — Income arising within or earned in India — Income derived from business operation in India — Taxability of — Exemption under applicable Double Taxation Avoidance Agreement (DTAA): In this case, Art. 5(3) of the DTAA predicated that notwithstanding the preceding provisions of the Article concerned, which would mean Arts. 5(1) and 5(2), the establishment in question would still not be a PE, if any of the clauses in Art. 5(3) are applicable. It was held by the Supreme Court that the nature of activities carried on by respondent through its liaison office in India, as permitted by RBI, are in the nature of “preparatory or auxiliary character”. Hence, they are covered by Art. 5(3)(e) of the DTAA between India and UAE, and fixed place used by respondent as liaison office in India, would not qualify as PE in terms of Arts. 5(1) and 5(2) of the said DTAA on account of non obstante and deeming clause in Art. 5(3) of the DTAA. Hence, the said activity of the respondent is not amenable to tax liability in terms of Art. 7 of the DTAA. [Union of India v. UAE Exchange Centre, (2020) 9 SCC 329]

Maharashtra Regional and Town Planning Act, 1966 (37 of 1966) — S. 88 and Ch. VII (Ss. 126 to 129) — Cohesive and harmonious construal of S. 88: S. 88 cannot be read in isolation and has to be read along with provisions under Ch. VII (Ss. 126 to 129). Thus, held, mere declaration of Town Planning Scheme does not result in vesting of the land in question in the authority concerned, unless the land has been acquired properly in accordance with law. [Hari Krishna Mandir Trust v. State of Maharashtra, (2020) 9 SCC 356]

Civil Procedure Code, 1908 — S. 11 — Res judicata: Issue only collaterally or incidentally decided in earlier proceedings, held, would not operate as res judicata in proceedings where the issue is directly and substantially involved. Test to be applied to ascertain whether the matter was directly and substantially in issue, explained. The test is whether the issue was necessary to be decided for adjudicating on the principal issue and was decided: if it is clear that the earlier judgment was in fact based upon that decision, then it would be res judicata in a latter case, but not otherwise. Such determination is to be made on the facts of each case. Examination of pleadings, issues framed and judgment of the earlier proceedings is required. [Nand Ram v. Jagdish Prasad, (2020) 9 SCC 393]

Aviation Law — General Principles re Liability/Expected Service Standards for Carriage of Goods and Persons/Deficiency in service: Departure of flight without passenger who had been issued boarding pass does not amount to deficiency of service, when such passenger fails to reach the boarding gate in time. [Indigo Airlines v. Kalpana Rani Debbarma, (2020) 9 SCC 424]

 Arbitration and Conciliation Act, 1996 — S. 34: Limitation period for challenging arbitral award: Maximum outer limit of three months plus 30 days is mandatory. Where challenge to award was filed when award was at execution stage, it was well beyond the above maximum limitation period. [BBM Enterprises v. State of W.B., (2020) 9 SCC 448]

Constitution of India — Art. 217 — Appointment of High Court Judges — Inordinate delays in making recommendation to fill vacancies by High Court Collegiums: High Court Collegiums must make endeavour to recommend names against vacancies as early as possible even if they are not made at one go. Some Courts do not recommend fresh names without earlier list being cleared. It was held that there is no such impediment and it should be a continuing process of recommending names without waiting for result of earlier recommendations till all recommendations are made. Otherwise, time period to process names is such that by time appointments take place, another set of vacancies arise which brings problem of vacancies to square one. Detailed report regarding existing and expected vacancies called for from all High Courts, explaining as to what is the time period within which recommendations can be expected to be made. [PLR Projects (P) Ltd. v. Mahanadi Coalfields Ltd., (2020) 9 SCC 452]

Environment Law — Environmental Clearance/NOC/Environment Impact Assessment (EIA) — Grant of/Quashment of/Irregularity in/Judicial review: In this case there were issues whether entire material including report of Joint Committee which was relevant to consider case of parties herein was available before NGT and whether NGT was justified in proceeding with matter in manner as it has presently done. Hence, the matter was remanded to NGT for consideration afresh after taking into account the relevant report which had now become available and additional relevant material if sought to be adduced by the parties. [Wonder Projects Development (P) Ltd. v. Union of India, (2020) 9 SCC 454]

Ancient and Protected Monuments, Archaeology, Art and Antiquities — Administration, Conservation, Maintenance, Refurbishment, Alteration, etc. of Monuments — Mahakaleshwar Temple, Ujjain: Direction issued regarding steps to be taken to prevent deterioration of Shivalinga and steps to be taken to preserve temple structure, including Chandranageshwar Temple. [Sarika v. Mahakaleshwar Mandir Committee, (2020) 9 SCC 460]

Criminal Procedure Code, 1973 — S. 438 — Anticipatory bail cases — Posting of: It is the duty of the Registry of court to post such cases with due diligence. In this case, order in anticipatory bail case made returnable in four weeks, but not listed for almost a year. Registry directed to furnish an explanation on the administrative side as to why the matter was not listed as directed after four weeks, more so, in the nature of matter being of anticipatory bail. [Mahtab Alam v. State of Bihar, (2020) 9 SCC 466]

Commercial Courts Act, 2015/Commercial Courts, Commercial Division and Commercial Appellate Division of High Courts Act, 2015 — S. 12-A — Time prescribed under for completing process of compulsory pre-litigation mediation and settlement: Said time shall stand extended from time when COVID-19 Lockdown is lifted plus 45 days thereafter. However, if period of Lockdown plus 45 days has expired, no further period shall be liable to be excluded. [Cognizance For Extension of Limitation, In re, (2020) 9 SCC 468]

Service Law — Departmental Enquiry — Judicial review/Validity — Scope: Power of judicial review is distinct from appellate power exercised by departmental appellate authority. Further held, judicial review is evaluation of decision-making process and not merits of decision itself which is to ensure fairness in treatment and not fairness of conclusion. Judicial review ought to be used to correct manifest errors of law or procedure which might result in significant injustice or violation of principles of natural justice. Moreover, where appellate or reviewing authority comes to a different conclusion, ordinarily decision under appeal ought not to be disturbed insofar as it is plausible and not perverse. [Pravin Kumar v. Union of India, (2020) 9 SCC 471]

Trusts and Trustees — Religious and Charitable Endowments and Trusts — Nanded Sikh Gurudwara Sachkhand Shri Hazur Apchalnagar Sahib Act, 1956 (37 of 1956) — Ss. 6(1)(viii), 6(2), 6(3), 2(e) & 2(c) and Ch. II r/w R. 6 of the 1958 Rules: Nomination of four members under S. 6(1)(viii) by State Government to the statutory Gurudwara Board, not permissible. S. 6(3) does not apply to the nomination to be made under S. 6(1)(viii) and the exclusive statutory authority for making the nomination of four members under S. 6(1)(viii) is vested in the Diwan. Expression “Diwan” under 1956 Act is an institution and not an individual person. [Bahginder Singh v. Manjieeth Singh, (2020) 9 SCC 484]

Civil Procedure Code, 1908 — Ss. 96, 100 and Or. 1 R. 10 — Appeal from original decree — Maintainability — Locus standi — “Person aggrieved” — Rejection of leave to appeal — Legality: In this case, judgment and decree not being a judgment in rem, holding that certain transactions, in no way concerning the interest of the applicant appellants, were time-barred and granting injunctive relief in respect of only the parties to the suits concerned. Appellants could in no way establish how their interests were affected in any way by decree in question. Thus, held, appellants failed to demonstrate that they were prejudicially or adversely affected by decree in question or that any of their legal rights were jeopardised so as to bring them within ambit of expression “person aggrieved”. [V.N. Krishna Murthy v. Ravikumar, (2020) 9 SCC 501]

Stamp Act, 1899 — S. 40(1)(b) — Imposition of extreme penalty i.e. ten times the amount of the proper duty or deficient portion thereof — Exercise of discretion in respect of: The amount of penalty not exceeding ten times is not an amount to be imposed as a matter of course. Neither is imposition of penalty of ten times under S. 40(1)(b) automatic nor can it be mechanically imposed. Imposition of the extreme penalty i.e. ten times of the duty or deficient portion thereof cannot be based on the mere factum of evasion of duty. Reasons such as fraud or deceit in order to deprive the Revenue or undue enrichment are relevant factors to arrive at a decision as to what should be the extent of penalty under S. 40(1)(b). [H.C. Dhanda Trust v. State of M.P.,(2020) 9 SCC 510]

Penal Code, 1860 — S. 302 or S. 304 Pt. II [S. 300 Exception 4]: In this case, there was assault by accused on head of deceased with lathi, leading to his death in hospital the next day. It was held that circumstances, manner of assault, nature and number of injuries, all have to be considered cumulatively, to decipher intention or knowledge, as the case may be. Assault was not premeditated but took place in heat of passion due to land dispute. The act was done with knowledge that it was likely to cause death, but without any intention to cause death. Hence, conviction altered from S. 302 to S. 304 Pt. II IPC. As accused had already undergone maximum period of sentence prescribed therein, therefore, he was directed to be set at liberty forthwith. [Jugut Ram v. State of Chhattisgarh, (2020) 9 SCC 520]

Penal Code, 1860 — S. 302 or S. 304: Where death was due to single injury caused by accused, legal position summarised whether S. 302 would be attracted or not. [Stalin v. State, (2020) 9 SCC 524]

T.N. Urban Land (Ceiling and Regulation) Act, 1976 (24 of 1978) — Ss. 20 and 21 — Exemption granted under the Act — Non-compliance with conditions of — Measures that may be taken by competent authority — Scope of: There must be strict compliance with statutory regime. Imposition of sanctions beyond what is expressly permitted by statute is not permissible. Further held, any undertaking given by the party concerned cannot expand the statutory jurisdiction of the authority concerned. Competent authority is only permitted by the 1976 Act to withdraw the order of exemption or to declare such land to be excess land under S. 21, with its attendant consequences as provided under the 1976 Act. [Shridhar C. Shetty v. Collector, (2020) 9 SCC 537]

Constitution of India — Art. 254 — Repugnancy under Art. 254 — Meaning of: Preconditions for question of repugnancy under Art. 254, when can be considered. Principles summarised regarding tests for whether laws are repugnant to each other. Doctrine of repugnancy not attracted if laws partially or incidentally cover the same area in a different context and to achieve a different purpose. In case of repugnancy, Central law prevails over State law. [West U.P. Sugar Mills Assn. v. State of U.P., (2020) 9 SCC 548]

Wealth Tax Act, 1957 — Ss. 3 and 21-AA — Incidence of wealth tax: Law explained regarding persons to be assessed under wealth tax. Social club such as appellant Bangalore Club, held, not covered under S. 3(1) if looked at in isolation without considering S. 21-AA. [Bangalore Club v. CWT, (2020) 9 SCC 599]

Insolvency and Bankruptcy Code, 2016 — S. 7 — Acknowledgement of debt by corporate debtor in earlier insolvency proceedings — Relevance of: Counter-affidavit of corporate debtor in earlier petition, held, was not a pleading of the insolvency applicant in the earlier insolvency proceedings. Rather, it was an admission of the outstanding debt by the corporate debtor and was admissible qua debt acknowledgement in later insolvency proceedings. [Shri Equipment Finance Ltd. v. Rajeev Anand, (2020) 9 SCC 623]

Narcotic Drugs and Psychotropic Substances Act, 1985 — Ss. 42, 55 and 20(b)(ii)(B): In this case of seizure of ganja there was official witnesses and support from independent witnesses was absent. Testimony of police officials was found reliable and trustworthy. No enmity was found between the police witnesses and the accused. No such defence was taken in the statement under S. 313 CrPC.  It was held that legally, testimony of the official witnesses cannot be rejected on the ground of non-corroboration by independent witness. Resultantly, absence of independent support to the official witnesses, held, not fatal. Compliance with Ss. 42 and 55 was fully proved on the record. Sample seized and sealed was also proved to be sent to the FSL. Hence, conviction was affirmed. [Rizwan Khan v. State of Chhattisgarh, (2020) 9 SCC 627]

Criminal Procedure Code, 1973 — S. 197 — Sanction for prosecution — When not to be accorded: In this case, there was exoneration on merits by CVC, where allegation found to be not sustainable at all and accused held innocent. Criminal prosecution on same set of facts and circumstances, cannot be allowed to continue, on underlying principle of higher standard of proof in criminal cases. No sanction ought to be accorded and no offence under IPC made out. Judgment of courts below, set aside, and accused discharged from offences under IPC. [Ashoo Surendranath Tewari v. CBI, (2020) 9 SCC 636]

Motor Vehicles Act, 1988 — Ss. 166 and 173 — Fatal accident — Compensation — Consortium — What is and when may be awarded: Expression “consortium” includes spousal consortium, parental consortium as well as filial consortium. It is certainly not the law that consortium is only payable as a spousal consortium and consortium is not payable to children and parents. Apart from spousal consortium, parental and filial consortium, held, are payable in fatal accident claim. [New India Assurance Co. Ltd. v. Somwati, (2020) 9 SCC 644]

Case BriefsHigh Courts

Allahabad High Court: The Division Bench of Pankaj Naqvi and Piyush Agrawal, JJ., issued a general mandamus to Competent Authorities under U.P. Apartment Act, 2010 and U.P. Industrial Area Development Act, 1976 or any other cognate enactment to decide the grievances of home buyers within 3 months from the date the grievance is brought to their knowledge.

State of U.P. taking cognizance of the rise in population and demand for space especially for residential purposes enacted U.P. Apartment (Promotion of Construction Ownership and Maintenance) Act, 2010.

It has been stated that the object of the Act is to give primacy to the interest of the owners of the apartments and protection of their rights against arbitrary and profit-oriented actions of the promoters/builders in which a role of an arbiter has been assigned to the competent authority in the Development Authority as held in Designarch Infrastructure Pvt. Ltd. vs. Vice Chairman, Ghaziabad Development Authority, 2013 (9) ADJ 594.

Genesis of the instant petition

Bench has taken judicial notice that a large number of cases have been coming before the Court on behalf of the home-buyers who after having spent their hard-earned life savings, buy an apartment, only to face hostile and arbitrary actions from the promoters/builders/Development Authorities and instead of resolving such disputes, they become mute spectators.

Irregularities highlighted by Home-Buyers

Petitioner by the instant petition has highlighted several irregularities in violation of their agreements on the part of the respondent 3 being the developer co-promoter of the residential project “Shipra Shritsti” which despite several representations to respondent 2 have gone unattended.

High Court deemed it appropriate to issue a general mandamus to the competent authorities to dispose of the grievance of home-buyers within a stipulated period so as to obviate an individual home-buyer or a registered association, as the case may be, from approaching this Court time and again.

Further, the Court added that the benefit of this order shall also be extended to the competent authority envisaged under the U.P. Industrial Area Development Act, 1976 and other cognate enactments.

Court issues directions

Following were the directions issued by the High Court in light of the above discussion:

(i) A general mandamus is issued to the Competent Authorities under U.P. Apartment Act, 2010 & U.P. Industrial Area Development Act, 1976 or any other cognate enactment to decide the grievance of the home- buyers or their associations, positively within 3 months from the date the grievance is brought to their knowledge, by reasoned and speaking order under intimation to the aggrieved persons.

(ii) The Competent Authority shall ensure that before any decision is taken, a right of audience is given to the parties concerned.

(iii) The Competent Authority shall ensure that an officer not below the rank of a Gazetted Officer shall periodically visit the apartment/building at least once in 6 months at a prior notice to the registered association which shall be obliged to circulate it amongst its member so as to give them an opportunity to ventilate their grievance if any. Any reported violation shall be immediately brought to the notice of the Authority concerned which shall immediately take remedial steps.

(iv) Any inaction on the part of Competent Authority shall be construed as a serious dereliction of duty, warranting interference from the State Government.

[Shipra Sristhi Apartment v. State of U.P., Writ-C No. 13298 of 2020, decided on 05-01-2021]


Advocate for the Parties:

Counsel for Petitioner: Abhinav Gaur, Anoop Trivedi (Senior Adv.), Vibhu Rai

Counsel for Respondent: C.S.C., Ravi Prakash Pandey, Rohan Gupta, Tarun Agrawal

Case BriefsTribunals/Commissions/Regulatory Bodies

Customs, Excise and Services Tax Appellate Tribunal (CESTAT): Ashok Jindal (Judicial Member) allowed an appeal which was filed against the impugned order wherein credit had been denied on the premise as per Notification No.02/14-CE (N.T.) dt. 20-01-2014, the appellant was not entitled to credit prior to the Notification No.01/10-CE dt. 6-02-2010.

The appellant was located in the State of Jammu & Kashmir and was availing the benefit of exemption Notification No.01/10-CE dt.6-02-2010. The appellant procured certain inputs and availed credit of duty paid on these inputs. The Revenue stated that an assessee is not entitled to avail credit against the inputs issued by the units, who were availing exemption under Notification No.01/10-CE dt. 6-02-2010 and after the introduction of Notification No.02/14-CE (N.T.) dt. 20-01-2014, the notification No.01/10-CE dt. 6-02-2010 was amended thereafter the credit was available to the assessee. After adjudication, the credit availed by the appellant was denied. Counsel for the appellant also submitted that the period involved in this case was 01-08-2012 to 19-01-2014 whereas the show cause notice had been issued on 31-08-2017 by invoking the extended period of limitation.

The Tribunal observed that similarly placed assessee was allowed the credit although against those orders, the appeals had been filed by the Revenue before the Commissioner (Appeals), in that circumstance, when the Revenue was having divergent views on the issue, the extended period of limitation was not applicable.

The Tribunal allowed the appeal stating that the denial of credit was barred by limitation as the show cause notice was issued by invoking the extended period of limitation.[Pioneer Pesticides (P) Ltd. v. Commr. Of CGST, Appeal No.E/60162 of 2020, decided on 12-01-2021]


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Case BriefsHigh Courts

Himachal Pradesh High Court: Tarlok Singh Chauhan, J., while dismissing the present petition on lack of merits, said, “… election process has already begun and final voter list has also been published, therefore, entertaining this petition at this stage would amount to obstructing the election process, which is not permissible.”

Petitioner in the present case, are aggrieved by non-inclusion of their names in the voter list and have moved the present petition seeking relief for (i) revision of electoral roll of the gram panchayat (ii) impugned order to be set aside.

With respect to interference by the Court under Article 226, Court said, “It is a well-settled proposition of law that inclusion or exclusion of name in the voter list cannot be termed as an extraordinary circumstance warranting interference of the High Court in exercise of the jurisdiction under Article 226 of the Constitution. However, it is always open to a person whose name is not included in the voter list to avail the benefit by filing election petition as the authorities constituted have wide powers to cancel, confirm and amend the election and it can also direct to hold fresh election, in case, the election is eventually set aside.”

Court further observed that only in extraordinary and exceptional circumstances, the High Court can entertain writ petition under Article 226 of the Constitution where the order is ultra vires or nullity and/or ex facie without jurisdiction. Reliance was placed on Rule 14 and 24 of the Himachal Pradesh Panchayati Raj (Election) Rules, 1994 in addition to the case of Union of India v. Dudh Nath Prasad, (2000) 2 SCC 20 and Bhagwan Dass v. Kamal Abrol, (2005) 11 SCC 66.

Dismissing the petition, Court noted, “The present petition filed after commencement of the election process, that too, with a view to stall election, therefore, cannot be entertained, when the petitioner has an alternate efficacious remedy of filing an election petition under Rules.”[Akhtar Hussain v. HP State Commission, CWP No. 6427 of 2020, decided on 02-01-2021]


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Case BriefsTribunals/Commissions/Regulatory Bodies

Central Information Commission (CIC): Saroj Punhani, J., directed the CPIO of CBI to provide a cogent and descriptive justification for denying information to the appellant seeking certain information relating to lookout notice, detention notice, etc. issued against Vijay Mallya.

In the instant matter, appellant has sought information through eight points pertaining to lookout notice/detention notice/circular (LoC) issued on October 2015 relating to Vijay Mallya:

  • Furnish a copy of Lookout notice/detention notice /Lookout Circular (LoC) issued on October 12, 2015, and /or October 16, 2015, and or Lookout notice/detention notice / Lookout Circular (LoC) in October 2015 relating to Vijay Mallya.
  • Furnish a Copy of Lookout circular (LoC) inform notice/Lookout on arrival Circular (LoC) etc. issued on 24 November, 2015, or last week in November 2015 relating to Vijay Mallya.
  • Provide the Name and Designation of Officer who authorized to change/ alter /from Lookout notice /Lookout circular (LoC) detention notice issued on October 12, 2015, or October 16, 2015, to Lookout Circular (LoC) inform notice/Lookout on arrival Circular (LoC) etc issued in last week of November, 2015 or November 24, 2015, relating to Vijay Mallya.
  • Provide a Copy of Act, Guidelines, Circulars, Notifications, office Memorandum Rules and Regulations, Copy of Act etc relating to Lookout notice/ detention notice /Lookout Circular (LoC) was issued on October 12, 2015 / Lookout circular (Loc) in October 2015 relating to Vijay Mallya.
  • Furnish a Copy of Act, Guidelines, Circulars, Notifications, Office Memorandum Rules and Regulations, Copy of Act etc relating to Lookout Circular (LoC) inform notice etc issued in last week of November 2015, or November 24, 2015, relating to Vijay Mallya.
  • Telephone Number and Email Id of central public Information officer and Appellate Authority as per official Memorandum of Dept of personnel and training available on www.rti.qov.in > Circulars.
  •  Exact web link of the above information on your official web site in compliance to Dept of Personnel &_ Training, circulars guidelines e.g.No.1/1/2013-IR/2014 uploading of RTI replies etc. issued from time to time.

On being dissatisfied with CPIO’s information, the appellant had filed a first appeal dated 10-11-2018, later FAA’s order upheld the CPIO’s reply.

Appellant stated that the square denial of the information sought for under Section 8(1)(h) of the RTI Act by the CPIO & the FAA is not appropriate as the case pertains to tenable allegations of corruption against Vijay Mallya for defaulting a loan of over Rs 9000 crore which is effectively public money and therefore the said information was crucial for the citizens.

CPIO submitted that primarily the appellant’s queries do not seem to be very clear in terms of the guidelines he referred to. Further, it was stated that at the time of the RTI application’s reply, the extradition case of Vijay Mallya was pending before the Court of Law in London and as on date two cases against him are pending investigation, in one of these cases the Chargesheet had been filed, while in the other case, the investigation is underway.

In view of the above-stated reasons, the information sought for was denied to the appellant under Section 8(1)(h) of the RTI Act.

Decision

The commission observed that neither the CPIO’s reply nor the FAA’s order conveyed the proper reasons for invoking Section 8(1)(h) of the RTI Act.

Bench directed the CPIO to provide a reply to the appellant incorporating a cogent and descriptive justification for denying the information sought for under Section 8(1)(h) of the RTI Act.

Appeal was disposed of in view of the above-stated. [Vihar Durve v. CPIO, CBI; CIC/CBRUI/A/2019/100528; decided on 12-01-2021]

Case BriefsHigh Courts

Tripura High Court: A Division Bench of Akil Kureshi, CJ and S.G. Chattopadhyay J., while allowing the present petition, held, “One department of the Government cannot cite the reason of another department not acting promptly enough to deny the benefit declared by the Government under any scheme.”

The petitioner herein challenged a communication dated 25-06-2020 and further prayed for grant of subsidy in terms of Tripura Industrial Investment Promotion Incentive Scheme, 2012 (hereinafter to be referred to as the Incentive Scheme). Petitioner is a private limited company and is engaged in manufacturing different types of UPVC pipe and fittings, HDE coil pipes, etc. for which the petitioner had established a manufacturing unit at Agartala in the year 2013. The State of Tripura had framed the said scheme which envisaged grant of certain incentives in the form of subsidy to the specified industries set up on or after 01-04-2012. Such rebate would be equal to the net amount of Tripura Value Added Tax and Central Sales Tax and other taxes paid by the industry to the State Government on sale of finished goods subject to certain conditions. The petitioner was one of the eligible units and in the past had also claimed and was granted subsidy as per the terms of the said scheme. The issue for determination in the instant case is, a refund of the VAT etc. under the said scheme for the period between 01-01-2016 to 31-12-2016 and thereafter from 01-01-2017 to 30-06-2017. The petitioner first applied under two separate applications for such refund to the District Industries Centre on 23-06-2020 along with all necessary documents. These applications of the petitioner were rejected by the District Industries Centre by two separate orders both dated 25-06-2020. The sole ground cited for rejection of the petitioner’s applications was that the claim was submitted after expiry of two years from the period to which the claim related.

Court observed, “It is not in dispute that a petitioner is otherwise an eligible unit entitled to the refund of the value-added tax under the said scheme, of course subject to fulfillment of the conditions contained therein. The scheme also envisages time limit for making application for refund. However, if the VAT department of the Government had delayed issuing necessary certificates of payment of tax to the petitioner, the application of the petitioner for refund cannot be rejected only on the ground of delay in making the same.”

While issuing necessary directions, Court held, “The District Industrial Centre shall consider the petitioner’s further representations both dated 13-07-2020 and the contents thereof. If it is found that the petitioner is correct in contending that the refund applications were delayed on account of non-issuance of certificate of payment of tax by the VAT authorities, its applications for refund shall be entertained and examined on merits and refund to the extent payable be released. If, on the other hand, the authority comes to the conclusion that delay in making the applications could not be attributed to the delay in issuance of the VAT payment certificates by the concerned authority, a speaking order shall be passed and communicated to the petitioner. Entire exercise shall be completed within four months from today.”  [Agartala Plastic Private Ltd. v. State of Tripura, WP(C) No. 598 of 2020, decided on 12-01-2021]


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Case BriefsHigh Courts

Chhattisgarh High Court: Sanjay K Agrawal J., allowed the appeal and condoned the delay while setting aside the impugned order.

The facts of the case are that the plaintiffs filed a civil suit for declaration of title and for permanent injunction in respect of the land. The Trial Court dismissed the suit of the plaintiffs, against which the plaintiffs preferred an appeal under Section 96 of the Civil Procedure Code i.e. CPC before the first appellate court which was barred by limitation, an application under Section 5 of the Limitation Act was also filed stating that the plaintiffs preferred an application under Order 43 Rule 1(U) of the CPC before the High Court that has been dismissed. Thereafter appeal was preferred before the first appellate court which was rejected being devoid of merits. Aggrieved by this second appeal was filed under Section 100 of CPC.

Counsel for the appellants submitted that first appellate Court is absolutely unjustified in not condoning the delay of 72 days as the plaintiffs are entitled to the benefit of Section 14 of the Limitation Act, as such, the application for condonation of delay ought to have been allowed by the first appellate Court.

The Court relied on judgment N. Balakrishnan v. M. Krishnamurthy, (1998) 7 SCC 123 wherein it was held

“11. Rule of limitation are not meant to destroy the right of parties. They are meant to see that parties do not resort to dilatory tactics, but seek their remedy promptly. the object of providing a legal remedy is to repair the damage caused by reason of legal injury. Law of limitation fixes a life-span for such legal remedy for the redress of the legal injury so suffered. Time is precious and the wasted time would never revisit. During efflux of time newer causes would sprout up necessitating newer persons to seek legal remedy by approaching the courts. So a life span must be fixed for each remedy. Unending period for launching the remedy may lead to unending uncertainty and consequential anarchy. Law of limitation is thus founded on public policy. It is enshrined in the maxim interest reipublicae up sit finis litium (it is for the general welfare that a period be putt to litigation). Rules of limitation are not meant to destroy the right of the parties. They are meant to see that parties do not resort to dilatory tactics but seek their remedy promptly. The idea is that every legal remedy must be kept alive for a legislatively fixed period of time.

  1. A court knows that refusal to condone delay would result foreclosing a suitor from putting forth his cause. There is no presumptions that delay in approaching the court is always deliberate. This Court has held that the words “sufficient cause” under Section 5 of the Limitation Act should receive a liberal construction so as to advance substantial justice

The Court thus observed that the meaning of “sufficient cause” under Section 5 of the Limitation Act, 1963 held that the Courts should adopt a liberal and justice-oriented approach and condoned the delay of four days in filing appeal, under Section 5 of the Limitation Act, 1963.

The Court thus held that “it is quite vivid that plaintiffs’ suit for declaration of title and for permanent injunction was dismissed against which plaintiffs filed an appeal along with an application for condonation of delay for condoning the delay of 72 days in filing the appeal offering an explanation that they filed MA before this Court which was dismissed as withdrawn on 08.5.2008. It is not disputed that against the judgment and decree of the trial Court, an appeal under Section 96 of CPC before the first appellate Court would lie and appeal under Order 43 Rule 1(U) of CPC would not lie, therefore, the appellants/plaintiffs were entitled for the benefit of Section 14 of the Limitation Actas such, in the considered opinion of this Court, sufficient cause has been shown by the plaintiffs for the delay of 72 days in filing the appeal.”

In view of the above, impugned order was set aside and appeal allowed.[Ramvriksha Gond v. Babulal Gond, Second Appeal No. 244 of 2010, decided on 14-01-2021]


Arunima Bose, Editorial Assistant has put this story together

Op EdsOP. ED.

The Vodafone case is termed as saga due to its unending character and a progression of measures taken by both the parties. A new step has been initiated by the Government of India, which is to challenge the Vodafone arbitration award ruling given in 2020 in Singapore. This is a matter of high political substance as the determination of this ruling will impact the pending matters against India. While it is quintessential to note here that there is no rule of precedence in the matters of international arbitration, however, we must rightly note here that tribunals do provide heavyweight to earlier rulings as observed from awards of various proceedings.

In this article, we would cover the grounds on which the appeal can be made against the award and critically analyse the same.

Brief Background

The beginning of this saga was initiated in the year 2007, followed by the judicial pronouncement which led to the retrospective tax legislation in 2012. The clash between Vodafone and India has been on the point of violation of the fair and equitable treatment (FET) clause present in the India-Netherlands bilateral trade agreement[1]. While assessing the validity of the arguments, the Tribunal, herein the Permanent Court of Arbitration (PCA) passed an award in favour of Vodafone. Now, India has appealed in the Singapore Court as being its last recourse some may say, the validity of arguments would again be based on the FET clause. It would be interesting to note the analysis and the viability of argument in the next section.

Violation of the FET Clause

The first and foremost contention raised is the violation of the fair and equitable clause by retrospectively amending the tax legislation. The decision was granted in favour of Vodafone. However, there remains various substantial contentions to be made that we must address.

Article 4(1) of the India-Netherlands Bilateral Investment Treaty (BIT) embodies the FET clause as follows:

 “Investments of investors of each contracting party shall at all times be accorded fair and equitable treatment and shall enjoy full protection and security in the territory of the other contracting party.”[2]

While a valid argument is made by Vodafone that retrospectively applying tax in this case is a violation of fair and equitable trade provision, we differ from this position.

Here, we must refer to Article 12 of the BIT agreement in order to proceed further:

Prohibitions and Restrictions.— The provisions of this agreement shall not in any way limit the right of either contracting party to apply prohibitions or restrictions or take action in accordance with its laws applied in good faith, on a non-discriminatory basis, and to the extent necessary for the protection of its essential security interests, or for the prevention of diseases and pests in animals or plants.”[3]

The retrospective application of tax law’s legality cannot and will not be discussed on an international forum as it is a sovereign function. The area that would be discussed is whether this action by the Government was unfair or discriminatory in any manner. Every sovereign has a right to enact amendments in its own jurisdiction, what we must see here is the object of the amendment made.

In order to determine the object of the Government of India we here refer to the Finance Bill, 20124:

“The legislative intent of this clause is to widen the application as it covers incomes, which are accruing or arising directly or indirectly. The section codifies source rule of taxation wherein the State where the actual economic nexus of income is situated has a right to tax the income irrespective of the place of residence of the entity deriving the income. Where corporate structure is created to route funds, the actual gain or income arises only in consequence of the investment made in the  activity  to  which such  gains  are attributable  and  not  the  mode  through  which  such  gains  are  realised.  Internationally  this principle is recognised by several countries, which provide that the source country has taxation right on the gains derived from offshore transactions where  the  value  is  attributable  to  the  underlying  assets.

 Certain judicial pronouncements have created doubts about the scope and purpose of Sections 9 and 195. Further, there are  certain  issues  in  respect  of  income  deemed  to  accrue  or  arise  where  there  are  conflicting  decisions  of  various  judicial authorities.”

 The above is provided as clarification to the object and scope of the Act. In short, it is necessary to draw a boundary between the genuine mistreatment of foreign investments that should be outlawed by the FET  standard  and  measures  of  sovereign  States  taken  in  pursuance  of  legitimate  policies  that  cannot  be  held  in  breach  of  the  standard,  even  where  such  measures  harm  foreign  investments.5

The above clause is an unqualified FET clause, and in these clauses lies a large amount of discretion as to the interpretation of these clauses. The question is whether international customary law or even minimum standard would be linked to it or not. These  factors  may  have  influenced  many  Arbitral  Tribunals  that  interpreted  the  unqualified  FET  standard  as  delinked  from  customary international law and focused on the plain meaning of the terms “fair” and “equitable”.6 So now the only ground remains are “just” and “fair”. A  number  of  tribunals  have  held  that  a  violation  by  the  host  State of an investment contract or of its own domestic law does not necessarily amount to a breach of the FET standard.7 Moreover, the threshold of violating the FET clause in cases of unqualified FET clause is one in which there is a high threshold as confirmed by the cases Eastern Sugar BV v. Czech Republic8 and AES v. Hungary9. Now, the object of the Indian Government was not to violate the fair and equitable clause or be unfair in any manner to any of its investors. It was to clarify the object and scope of Section 9 of the Finance Act, 2012. It is a sovereign function exercised that must not give rise to being unfair in any manner possible. The substantive argument one would make here is of legitimate expectation while investing and it is discussed in the next part.

Legitimate Expectations

The test for legitimate expectations lies in three elements as provided in Tecmed v. Mexico10 : consistency, transparency and unambiguous nature. Further in Saluka Investments B.V. v. Czech Republic11, the Permanent Court of Arbitration stated that the violation of legitimate expectations can be seen only in the case of discriminatory or unreasonable modifications.

We must here refer to the Report of the Damodaran Committee:

“Retrospective taxation has the undesirable effect of creating major uncertainties in the business environment and constituting a significant disincentive for persons wishing to do business in India. While the legal powers of a Government extend to giving retrospective effect to taxation proposals, it might not pass the test of certainty and continuity.”12

India’s position is clear that it is the sovereign exercise of power and that legislative power shall and must not be ceased at the whims of investors. It would undermine the sovereignty and exercise of its power. So according to this view and argument, India takes the defence that it has not breached the concept of legitimate expectations since it is exercising its sovereign power.

The principle of legitimate expectation is an autonomous standard. It is independent of the clauses mentioned with regards to FET. Even as per the Organisation for Economic Co-operation and Development (OECD) Report,13 the FET principle is an absolute standard of treatment.

Now the substantive question here is whether retrospectively amending the tax legislation would lead to a violation as to the legitimate expectation of an investor.

The first view that we can take is the one that was taken in three notable cases, Enron14, CMS15 and Occidental16. In these cases the substantive finding was that there could be no change in the legislation in a specific manner as to affect the very core of legitimate expectation. By this view, it can be said that India has not passed the test under legitimate expectation.

However, there is a second emerging view that must be referred to here. In Parkerings17 and Saluka18 investments the first view was not upheld. In this case it was said that it would be not right to freeze the law and it gave regard to the principle of sovereign power. Further, the Tribunal in the final findings concluded that to tackle uncertainty stabilisation clauses can be used and unless the legislation changed is unreasonable a claim under FET clause cannot succeed.

Conclusion

India has recently suffered a blow in Vodafone case and now Cairn Energy case19 in the matter of retrospective legislation. However, the saga is far from over. The two views still hold equitable water and India is banking on the fact that the second view present in the arguments would lead to a victory in the appeal proceedings in Singapore. In case, the matter is decided in favour of Vodafone, that may lead India to drastically change its policies and look at matters with a fresh perspective.


Managing Editor (UPES).

†† 4th year, UPES law student.

[1] Agreement between the Republic of India and the Kingdom of the Netherlands for the Promotion and Protection of Investments <https://www.italaw.com/sites/default/files/laws/italaw6147.pdf>.

[2] Agreement between the Republic of India and the Kingdom of the Netherlands for the Promotion and Protection of Investments, Art. 4(1) of the BIT <http://www.scconline.com/DocumentLink/deYAfbIF>.

[3] Agreement between the Republic of India and the Kingdom of the Netherlands for the Promotion and Protection of Investments, Art. 12 of the BIT <http://www.scconline.com/DocumentLink/deYAfbIF>.

4 Finance Bill, 2012 (Memorandum)

5 OECD document.

6 OECD, p. 22 <https://unctad.org/system/files/official-document/unctaddiaeia2011d5_en.pdf>.

7 P. 67, OECD.

8 SCC Case No. 088/2004, Partial Award dated 27-3-2007.

9 AES  v.  Hungary, ICSID Case No. ARB/07/22.

10 ICSID Case No. ARB/AF/00/2.

11 2006 SCC OnLine PCA 2.

12 Report of the Committee for Reforming the Regulatory Environment for Doing Business in India, p. 77.

13 OECD (2004), Fair and Equitable Treatment Standard in International Investment Law, OECD Working Papers on International Investment, 2004/03, OECD Publishing

14 Enron Corpn. and Ponderosa Assets, LP v. The Argentine Republic, ICSID Case No. ARB/01/3 (also known as Enron Creditors Recovery Corpn. and Ponderosa Assets, LP v. The Argentine Republic).

15 CMS Gas Transmission Co. v. Republic of Argentina, ICSID Case No. ARB/01/8.

16 Occidental Petroleum Corpn. and Occidental Exploration and Production Co. v. Republic of Ecuador, ICSID Case No. ARB/06/11.

17 Parkerings-Compagniet AS v. Republic of Lithuania, ICSID Case No. ARB/05/8.

18 Saluka Investments BV v. Czech Republic, 2006 SCC OnLine PCA 2.   <http://www.scconline.com/DocumentLink/D3Qc08Za>.

19 Cairn Energy PLC and Cairn UK Holdings Ltd.  v. Govt. of India, PCA Case No. 2016-7.

Legislation UpdatesNotifications

The term of office of Justice (Retd.) Bansi Lal Bhat, Member (Judicial) as officiating Chairperson, National Company Law Appellate Tribunal (NCLAT) extended for a period of three months w.e.f. 01-01-2021 or till the appointment of regular Chairperson in NCLAT or until further orders, whichever is the earliest.

NOTIFICATION


Ministry of Corporate Affairs

[Notification dt. 15-01-2021]

Case BriefsHigh Courts

Patna High Court: The question before Prabhat Kumar Singh J., for contemplation, was “Whether the candidate has violated the instructions in the OMR sheet and whether his result was right annulled by the Controller of Examination ?”

Petitioner sought quashing of the decision delivered by Controller of Examination declaring the result invalid for Physical Education and Health Instructor Ability Test, 2019, due to alleged usage of eraser and whitener in the OMR sheet.

Ritika Rani, counsel for the petitioner, challenged the said decision on the basis that it was arbitrary and irrational. It was vehemently argued that it was a mere mistake committed by the petitioner and the punishment was inadequate considering the nature of the mistake. It was further argued that the Board has not expressly informed about the said instructions.

On the contrary the counsel for respondents, Girijinsh Kumar and Pramod Kumar Singh, categorically stated the issue was already settled by a Coordinate Bench in Brajesh Kumar v. State of Bihar, CWJC No. 16359 of 2017, where the Court has dismissed the petition and held that “since the use of whitener, etc. was specifically prohibited under the instructions, no direction can be issued for publishing the result of those candidates.” It was further submitted that clear instruction was given to all the candidates including writ petitioner, not to use pen, eraser, or whitener on the OMR Sheets while attempting questions, otherwise the result will be declared invalid.

The court on perusal of records was of the opinion that petitioners violated the instructions given by the Board while answering the questions in OMR Sheets. It was held that “Such infringement of instruction during examination amounts to misconduct, hence such candidates are liable not to be selected.” Petition was dismissed as there was no irregularity in the order of the Controller.[Om Prakash Paswan v. State of Bihar, Civil Writ Jurisdiction Case No. 6890 of 2020, decided on 13-01-2021]


Aastha Sharma, Editorial Assistant has put this story together

Case BriefsHigh Courts

Delhi High Court: Vibhu Bakhru, J. held that an order of the arbitrators terminating the arbitral proceedings under Section 32(2)(c) of the Arbitration and Conciliation Act, 1996 (“A&C Act”) is NOT an “award”; and therefore a challenge to such order under Section 14(1)(a) is maintainable.

Facts and Issue

The petitioner, a Joint Venture constituted by Progressive Construction Ltd. and SUNCON Construction Berhard, Malaysia,  filed the present petition, inter alia, impugning an order passed by the two arbitrators terminating the arbitral proceedings under Section 32(2)(c) of the Arbitration and Conciliation Act, 1996. The present application was filed under Section 14(1)(a) read with Section 15 of the Act.

The arbitral proceedings were terminated because the arbitrator nominated by the petitioner had resigned and the petitioner had not taken steps to nominate another arbitrator in his place. Consequently, the arbitral proceedings could not proceed and the remaining two arbitrators constituting the Arbitral Tribunal concluded that it was impossible to continue the proceedings and, accordingly, terminated the same. The petitioner claimed that there was a communication gap and the petitioner was not aware that the arbitrator appointed by it had resigned. The Arbitral Tribunal had not issued any notice to the petitioner in this regard prior to terminating the arbitral proceedings.

The respondent, National Highways Authority of India (“NHAI”), contests the maintainability of the present petition as well as contends that the impugned order cannot be faulted.

Analysis

The foremost question addressed by the High Court was: Whether the impugned order constitutes an award?

The contention of the NHAI that the present petition was not maintainable and the only recourse available to the petitioner was to file an application under Section 34 of the A&C Act was founded on the assumption that the impugned order is an award. Notably, recourse to a Court against an award is available only under Section 34 of the A&C Act.

The High Court analysed that the term “award” is defined under clause (c) of sub-section (1) of Section 2 of the A&C Act and noted that”

It is now well settled that an award constitutes a final determination of a particular issue or a claim in arbitration.

It was also noted that Section 32 of the A&C Act also draws a clear distinction between a final arbitral award and orders passed by an Arbitral Tribunal. In terms of Sub-section (1) of Section 32 of the A&C Act, arbitral proceedings stand terminated by a final award or by such orders as are specified under Sub-section (2) of the said A&C Act.

The Court made reference to its earlier decision in Rhiti Sports Management (P) Ltd. v. Power Play Sports & Events Ltd, 2018 SCC OnLine Del 8678 wherein the Court had noted various decisions on the question as to what constitutes an award.

Relying on the Supreme Court decision in IFFCO Ltd. v. Bhadra Products, (2018) 2 SCC 534, the High Court noted that in order for a decision of the Arbitral Tribunal to qualify as an award, the same must finally decide a point at which the parties are at issue. In cases where the same is dispositive of the entire dispute referred to the Arbitral Tribunal, the said award would be a final award, which would result in termination of the arbitral proceedings.

Viewed in this context, the Court concluded:

“It is clear that an order, which terminates the arbitral proceedings as the Arbitral Tribunal finds it impossible or unnecessary to continue the arbitral proceedings, would not be an award. This is so because it does not answer any issue in dispute in arbitration between the parties; but is an expression of the decision of the Arbitral Tribunal not to proceed with the proceedings.”

The Court also stated that an order terminating the proceedings on failure of the claimant to file its Statement of Claims within the stipulated time, is also in the nature of an order under Sub-section (2) of Section 32 of the A&C Act and not an arbitral award because such an order does not decide any of the points on which the parties are in issue in the arbitration.

Decision

In the present case, the impugned order passed by the arbitrators expressly stated that the arbitral proceedings were terminated under Section 32(2)(c) as in their view, it had become impossible to continue the said proceedings. Indisputably, an order terminating the proceedings under Section 32(2)(c) can be impugned under Section 14(2) of the A&C Act.

It was contended on behalf of NHAI that even though an application under Section 14(2) may be filed, the present application which was under Section 14(1)(a) and Section 15 was not maintainable. This contention, according to the High Court, was unpersuasive:

“A plain reading of sub-section (2) of Section 14 of the A&C Act indicates that unless otherwise agreed by parties, a party could apply to a Court to decide on the question of termination of the mandate if a controversy remains concerning any of the grounds referred to in Sub-section 14(1)(a) of the A&C Act.”

It was also noted that the impugned order was an expression of the view of the arbitrators that they were unable to continue with the proceedings on account of the default on the part of the petitioner to fill the vacancy caused by the resignation of their arbitrator. Even though NHAI had preferred certain counterclaims, it too did not take any steps to ensure that the said vacancy was filled. It was also open for NHAI to apply to the Court for the appointment of an arbitrator, however, NHAI also chose not to do so.

Further, although the arbitrators had passed the impugned order, it was not disputed that a notice that they were contemplating the termination of the proceedings was not issued to the petitioner, prior to passing of the impugned order.

However, said the Court that, it could not be denied that the petitioner was responsible for the delay in the proceedings as it had inordinately delayed the appointment of an arbitrator. Whilst the Court was of the view that the petitioner ought not be rendered remediless to urge its claims, NHAI‘s contention that the petitioner must be visited with costs was merited.

Accordingly, the High Court set aside the impugned order, albeit, subject to payment of costs of Rs 25000 by the petitioner.

Further, now the petitioner had already nominated an arbitrator. It was directed that the Arbitral Tribunal will resume the arbitration proceedings at the stage obtaining on the date on which the arbitral proceedings were terminated. [PCL Suncon v. NHAI, OMP (T) (Comm) 80 of 2020, dated 12-1-2020]

Case BriefsHigh Courts

“[Sexual harassment] can be perpetrated by the members of any gender, even inter se.”

Calcutta High Court: Sabyasachi Bhattacharyya, J. held that a complaint under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 [“POSH Act”], is maintainable even against “a person” belonging to the same gender as that of the complainant. In other words, a complaint under the POSH Act is maintainable against women.

Issue

In the present petition, the petitioner contended that the respondent authorities acted without jurisdiction in entertaining a complaint on alleged sexual harassment against her, despite the fact that both, the petitioner and the complainant, are of the same gender.

Arguments

Petitioner

The petitioner stressed that the allegations of the complainant revolved around alleged vilifying and defaming in public. It was submitted that the act as alleged, could not fall within the purview of “sexual harassment” as contemplated in the POSH Act. She placed particular reliance on the definition of “sexual harassment” in Section 2(n) of the POSH Act and sought to impress upon the Court that the acts contemplated therein have no nexus with the present complaint.

It was next submitted that, as per Section 19(h) of the POSH Act, an employer shall cause to initiate action under IPC or any other law for the time being in force, against the perpetrator. It was argued that such an action, as envisaged under IPC, only pertains to a man being involved in the offence, which ingredient has to be factored in while appreciating the connotation of “sexual harassment” under the POSH Act.

It was submitted that since the Vishakha judgment [Vishakha  v. State of Rajasthan, (1997) 6 SCC 241] was the genesis of the POSH Act, the concept of the POSH Act has to be read and interpreted in the light of the said judgment. It was argued that the question of gender equality acquires primacy in deciding whether a complaint falls within the periphery of the POSH Act. In the present case, since the gender of the complainant and the respondent (petitioner herein) is the same, the question of the POSH Act being invoked does not arise.

Complainant

The complainant made reference to the University Grants Commission (Prevention, Prohibition and Redressal of Sexual Harassment of Women Employees and Students in Higher Educational Institutions) Regulations, 2015 and submitted that the said Regulations are broad enough to encompass respondents of all genders, implicitly meaning that the gender of the complainant and the respondents can very well be the same in order to attract the rigours of the Regulations, which govern the present parties as well. By placing particular reliance on Regulation 8(2), it was argued that the expression “the respondents shall file his/her reply” has been used therein, thereby bringing within its purview respondents of both genders. This, read with the definition of “respondent” in Section 2(m) of the POSH Act, which contemplates “a person” as a respondent, indicates clearly that same gender allegations can also be entertained under the POSH Act.

Analysis

The High Court, stated at the outset, that a cursory glance at Section 2(m) of the POSH Act shows that the term “respondent” brings within its fold “a person”, thereby including persons of all genders.

The Court was of the opinion that although there was substance in the submission of the petitioner that the said expression has to be read in conjunction with the rest of the statue as a whole, there is nothing in Section 9 of the POSH Act [which has been referred to in Section 2(m)] to preclude a same-gender complaint under the POSH Act.

“Although it might seem a bit odd at the first blush that people of the same gender complain of sexual harassment against each other, it is not improbable, particularly in the context of the dynamic mode which the Indian society is adopting currently, even debating the issue as to whether same-gender marriages may be legalized.”

It was also held that the definition of “sexual harassment” in Section 2(n) cannot be a static concept but has to be interpreted against the backdrop of the social perspective. Sexual harassment, as contemplated in the POSH Act, thus, has to pertain to the dignity of a person, which relates to her/his gender and sexuality; which does not mean that any person of the same gender cannot hurt the modesty or dignity as envisaged by the POSH Act.

“A person of any gender may feel threatened and sexually harassed when her/his modesty or dignity as a member of the said gender is offended by any of the acts, as contemplated in Section 2(n), irrespective of the sexuality and gender of the perpetrator of the act.”

The Court further held that if sub-section (2) of Section 3 [Prevention of Sexual Harassment] is looked into, it is seen that the acts contemplated therein can be perpetrated by the members of any gender, even inter se.

Decision

In such view of the matter, the High Court held that the act alleged by the complainant to have been perpetrated by the petitioner, as evident from her complaint was maintainable under the POSH Act. Hence, the complaint cannot be turned down at the outset.

It was however clarified that the merits of the allegations levelled by complainant against the petitioner have not been gone into in any manner by the court. And it will be open to the appropriate authorities to decide the matter independently, on its own merits. [Malabika Bhattacharjee v. Vivekananda College, WPA 9141 of 2020, dated 27-11-2020]

Case BriefsSupreme Court

Supreme Court: In a case relating to Prevention of Corruption Act, the 3-judge bench of Ashok Bhushan, R. Subhash Reddy and M.R. Shah*, JJ has partly allowed the appeal regarding quantum of sentence, while concurrent order of conviction by the Courts below was confirmed.

The appellant was convicted for offences under Sections 7, 13(2) read with 13(1) (d) of the Prevention of Corruption Act, 1988 whereby the Special Judge had sentenced him to undergo rigorous imprisonment for a period of two years with fine of Rs 5,000; which was confirmed by the High Court of judicature at Madras.

Aggrieved and dissatisfied, the appellant contended that he was a senior citizen aged about 69/70 years and had been already dismissed from service on being convicted for the offences under the Prevention of Corruption Act. Therefore, it was prayed to reduce the sentence imposed to the sentence already undergone.

Considering the fact that, out of two years sentence imposed by the Special Court, confirmed by the High Court, the appellant had already undergone approximately one year and one month and that the appellant was a senior citizen aged about 70 years who had been already dismissed from service, the Court stated,

“The ends of justice would be met if the sentence of two years rigorous imprisonment as imposed by the learned Special Court, confirmed by the High Court, is reduced to that of one year and one month rigorous imprisonment.”[S. Sundara Kumar v. State, CRIMINAL APPEAL No. 0039 of 2021, decided on 13-01-2021]


*Justice M.R. Shah has penned this judgment

Legislation UpdatesRules & Regulations

Insolvency and Bankruptcy Board of India (Model Bye-Laws and Governing Board of Insolvency Professional Agencies) (Amendment) Regulations, 2021

2. In the Insolvency and Bankruptcy Board of India (Model Bye-Laws and Governing Board of Insolvency Professional Agencies) Regulations, 2016 (hereinafter referred to as the principal regulations), in regulation 5,—

(i) after sub-regulation (4), the following sub-regulation shall be inserted, namely:—

“(4A) A shareholder director shall be an individual, who satisfies the eligibility norms, including experience and qualification, as decided by the Governing Board.”;

(ii) in sub-regulation (6), for clause (b), the following clause shall be substituted, namely:—

“(b) who has expertise in the field of finance, law, economics, accountancy, valuation, management or insolvency;”;

(iii) after sub-regulation (13), the following sub-regulations shall be inserted, namely:—

“(14) A director shall disclose any order of any authority that affects his character or reputation, to the insolvency professional agency, within one week of issue of such order:

Provided that a copy of the order shall be placed forthwith on the website of the insolvency professional agency;

Provided further that such director shall forthwith cease to be a director of the insolvency professional agency where the order disqualifies him to be a director of a company.”.

3. In the principal regulations, after regulation 5B, the following regulations shall be inserted, namely:-

6. Self-evaluation.

(1) The Governing Board shall evaluate its performance in a financial year within three months of the closure of the year, in the manner decided by it.

(2) The insolvency professional agency shall publish a report on self-evaluation referred to in sub-regulation (1) on its website.

Compliance Officer.

(1) An insolvency professional agency shall designate or appoint a compliance officer who shall be responsible for ensuring compliance with the provisions of the Code and regulations, circulars, guidelines, and directions issued thereunder.

(2) The compliance officer shall, immediately and independently, report to the Board any non-compliance of the provisions referred to in sub-regulation (1).

(3) The compliance officer shall submit a compliance certificate to the Board annually, verifying that the insolvency professional agency has complied with the provisions referred to in sub-regulation (1):

Provided that the annual compliance certificate shall also be signed by the managing director of the insolvency professional agency.

The Governing Board shall appoint or remove the compliance officer only by means of a resolution passed in its meeting”


Insolvency and Bankruptcy Board of India

[Notification dt. 14-01-2021]

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, WP (C) No.1039 of 2020, decided on 13-01-2021]


*Justice Ashok Bhushan has penned the judgment

Case BriefsTribunals/Commissions/Regulatory Bodies

Customs, Excise and Services Tax Appellate Tribunal (CESTAT): Ashok Jindal (Judicial Member) allowed an appeal which was filed against the rejection of a refund claim.

Initially, the proceedings were initiated against the appellant for non-payment of service tax under reverse charge mechanism for a commission paid to the foreign-based commission agent and during the course of audit, the objection was raised, the appellant paid the entire amount of service tax along with interest and prayed that the proceedings against the appellant was to be closed but the department issued a show-cause notice by invoking the extended period of limitation. The demands of service tax along with interest paid by the appellant were appropriated and the penalties were also imposed.

The appellant filed an appeal against the said order and prayed that in this case, the extended period of limitation was not invokable as whatever service tax was to be paid by them; they were entitled to take credit of the same. Therefore, it was a case of revenue neutrality. The Tribunal had concluded with the same and that appeal was allowed. In consequence, to the order the appellant had filed a refund claim of service tax paid for the extended period of limitation and interest. The adjudicating authority had rejected the same and on appeal before the Commissioner (Appeals), it was concluded that the appellant had already paid service tax along with interest in terms of Section 73 (3) of the Finance Act, 1994, the proceedings stood concluded, therefore, the refund of the amount claimed by the appellant was not admissible. Thus, the instant appeal was filed.

The Tribunal observed that both the parties had admitted the fact that in the earlier round of litigation, this Tribunal had passed the order and dropping the demand of service tax for an extended period of limitation along with interest and in that circumstance the refund claim filed consequent that order was admissible in the eyes of law. The Tribunal allowed the appeal while setting aside the impugned order.[Spray Engineering Devices Ltd. v. CCE & ST, Appeal No. ST/60418 of 2020, decided on 11-01-2021]


Suchita Shukla, Editorial Assistant has put this story together