Legislation UpdatesRules & Regulations

The Ministry of Commerce and Industry has issued the Static and Mobile Pressure Vessels (Unfired) (Amendment) Rules, 2021 on August 31, 2021. These Rules amend the Static and Mobile Pressure Vessels (Unfired) Rules, 2016 in the following manner:

  • New definitions of the following have been inserted:
    1. “Competent Person” would mean a person recognised by the Chief Controller, for carrying out tests, examinations, certification for installations and transport vehicles as stipulated in these rules provided the person possess the qualifications and experience and other requirements as set out in Appendix IIA to these rules and the recognition is granted as per procedure laid down in Rule 12. The Chief Controller has the power to relax the requirements of qualifications in respect of a competent person if such person is exceptionally experienced and knowledgeable.
    2. “ISO Tank Container”, means as a tank container which includes two basic elements, the vessel and the framework, suitable for the carriage of compressed gas for conveyance by road, rail and sea, including interchange between these forms of transport and complies with requirements of ISO 1496.
    3. “Third Party Inspection Agency”, defined as a professional organisation recognised by Chief Controller to carry out inspection, certifications, testing including safety audit of major accident hazards premises as defined under the Manufacture, Storage and Import of Hazardous Chemicals Rules, 1989.
  • A new sub rule has been inserted under Rule 47(7) which states that the district authority will grant no objection certificate or convey his refusal for granting no objection certificate with reasons in writing to the applicants within two months.
  • Rule 61 has been substituted and states that when a licence granted under these rules is lost or accidentally destroyed, system generated copy may be downloaded by the licensee from online portal of Petroleum and Explosive Safety Organization.


*Tanvi Singh, Editorial Assistant has reported this brief.

Case BriefsSupreme Court

Supreme Court: Explaining the scope of Section 92 Proviso (6) of the Evidence Act, 1872, the 3-judge bench of NV Ramana, CJ* and Surya Kant and Aniruddha Bose, JJ has held that the said proviso can be resorted to only in cases where the terms of the document leave the question in doubt.

“But when a document is a straightforward one and presents no difficulty in construing it, the proviso does not apply. In this regard, we may state that Section 95 only builds on the proviso 6 of Section 92.”

The Court was of the opinion that if the contrary view is adopted as correct it would render Section 92 of the Evidence Act, otiose and also enlarge the ambit of proviso 6 beyond the main Section itself.

Background

Initially Appellant’s husband was running a business of stationary in the name of “Karandikar Brothers” before his untimely demise in the year 1962. After his demise, she continued the business for some time but later decided to let the Respondent run the same for some time.

The terms of the agreement were:

“The stationary shop by name “Karandikar Brothers” belonging to you of the stationary materials which is situated in the premises described in Para 1 (a) above and in which the furniture etc. as described in Para l(b) above belonging to you is existing is being taken by me for conducting by an agreement for a period of two  years beginning from 1st February 1963 to 31st January 1965.

The rent of the shop described in Para 1 (a) above is to be given by you only to the owner and I am not responsible therefor. I am to pay a royalty amount of Rs. 90 /-(Rupees Ninety only) for taking the said shop for conducting, for every month which is to be paid before the 5th day of every month.”

Time after time, the contract was duly extended. In 1980s, desiring to start her husband’s business again, appellant herein issued a notice requesting the Respondent to vacate the suit premises, However, the Respondent replied to the notice claiming that the sale of business was incidental rather the contract was a rent agreement stricto sensu.

The Trial Court while negating the contention of the Respondent, that the shop premises was given to him on license basis.

The Bombay High Court, however, held that:

“Thus, considering the entirety of the case, in my view, both   the   Courts   below   have   incorrectly   interpreted   the document and the surrounding circumstances which, in my view, indicate that the parties had in fact agreed that the premises were transferred to the appellant on a leave and license basis.”

Analysis

Section 95. Evidence as to document unmeaning in reference to existing facts.—

When language used in a document is plain in itself, but is unmeaning in reference to existing facts, evidence may be given to show that it was used in a peculiar sense.  Illustration A sells to B, by deed, “my house in Calcutta”. A had no house in Calcutta, but it appears that he had a house at Howrah, of which B had been in possession since the execution of the deed. These facts may be proved to show that the deed related to the house of Howrah.

Section 92. Exclusion of evidence of oral agreement.—

When the terms of any such contract, grant or other disposition of property, or any matter required by law to be reduced to the form of a document, have been proved according to the last section, no evidence of any oral agreement or statement shall be admitted, as between the parties to any such instrument or their representatives in interest, for the purpose of contradicting, varying, adding to, or subtracting from, its terms:…

Proviso (6).—Any fact may be proved which shows in what manner the language of a document is related to existing facts.

The Court explained that Section 92 specifically prohibits evidence of any oral agreement or statement which would contradict, vary, add to or subtract from its terms. If oral evidence could be received to show that the terms of the document were really different from those expressed therein, it would amount to according permission to give evidence to contradict or vary those terms and as such it comes within the inhibitions of Section 92. It could not be postulated that the legislature intended to nullify the object of Section 92 by enacting exceptions to that section.

Considering the facts and materials placed before it, the Court was of the opinion that the contract mandated continuation of the business in the name of ‘Karandikar Brothers’ by paying royalties of Rs. 90 per month.

“Once the parties have accepted the recitals and the contract, the respondent could not have adduced contrary extrinsic parole evidence, unless he portrayed ambiguity in the language. It may not be out of context to note that the extension of the contract was on same conditions.”

The Court, hence, held that the High Court erred in appreciating the ambit of Section 95, which led to consideration of evidence which only indicates breach rather than ambiguity in the language of contract. The evidence also points that the license was created for continuation of existing   business, rather than license/lease of shop premises.

The Court was, hence, of the opinion that if the meaning provided by the High Court is accepted, then it would amount to Courts substituting the bargain by the parties.

“Such interpretation, provided by the High Court violates basic tenants of legal interpretation.”

[Mangala Waman Karandikar v. Prakash Damodar Ranade, 2021 SCC OnLine SC 371 , decided on 07.05.2021]


*Judgment by: CJI NV Ramana

Know Thy Judge| Justice N.V. Ramana

Case BriefsHigh Courts

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

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

Petitioner 2 is the secretary of petitioner 1 – Society.

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

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

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

Analysis, Law and Decision

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

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

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

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

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

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

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

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

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

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

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

Case BriefsTribunals/Commissions/Regulatory Bodies

Customs, Excise and Service Tax Tribunal (CESTAT): Justice P. Dinesha (Judicial Member) allowed the appeal filed by a shipping company against the Commissioner of Customs. He further decided that the impugned penalties stand set aside.

The authorities filed allegations against the appellant under Sections 112(d) and 114AA of the Customs Act, 1962. A show-cause notice was issued against the appellant herein under Sections 28 and 124 of the Customs Act stating that he did not inform the Revenue that the importer did not possess licence for import of Chlorodifluoromethane (R-22 Gas); he did not present the imported goods for examination; and thus he was liable for penalty under Section 112(a) of the Act for abetting smuggling of R-22 gas, for non-compliance of Regulations 11(d) and 11(n) of the Customs Broker Licensing Regulations, 2013 (CBLR).

Issue: Whether the Revenue was justified in imposing a penalty under Sections 112 (d) and 114AA of the Customs Act, 1962 on the appellant who was only a Customs Broker and not the importer.

J.V. Niranjan, Advocate for the appellant, contended that the Revenue had not established mens rea for levying penalty and that the authorities did not conduct any investigation, filed an appeal against the above allegations. L. Nandakumar, Advocate for the Respondent, prayed for sustaining the penalty contending that the Bill-of-Entry did not contain sufficient details of the goods sought to be imported and the appellant did not bother to ascertain whether the importer had the required licence, constituting a serious lapse covered under Regulations 11(d) and 11(n) of the CBLR.

The Tribunal opined that the Revenue was not able to clearly establish either active or passive role or any deliberate or mala fide act; and the appellant had advised the importer as to the requirement of import licence, being sufficient compliance insofar as Regulation 11(d) is concerned. It was further held that the allegations were not sufficient to fasten with the penalty of the nature impugned as it was not established that appellant handled the work of clearance with mala fide motive and Sections 112(a) and 114AA of the Customs Act include an intentional or deliberate act or omission and even the motive is attributable to the act of abetment to do any act or omit to do any act.

The appeal was allowed stating that Section 114AA could be invoked only on the establishment of the fact that the declaration, statement or document submitted in the transaction of any business for the purpose of the act is false or incorrect. The penalties and impugned order confirming the penalties questioned herein was set aside. [Sea Queen Shipping Services (P) Ltd. v. Commr. of Customs, 2019 SCC OnLine CESTAT 1483, decided on 05-12-2019]

Case BriefsForeign Courts

High Court of South Africa, Western Cape Division:  This appeal was filed before a 2-Judge Bench comprising of J I Cloete and M K Parker, JJ., against the order of Magistrate where appellant was convicted and sentenced without following the relevant provision.

Facts of the case were that the appellant was charged for contravening Section 65(2) (a) read with Section 89 (1) and (2) of the NRTA for drinking and driving. It is pertinent to note that appellant was convicted in 2010 for similar offence but under Section 65(1) (a). Court then ordered the suspension of the order of imprisonment of 4 months till 4 years during which he ought not to be found guilty of the same offence. In terms of the agreement, the appellant pleaded guilty of the charges against him. Appellant had submitted mitigating factors such as his fixed job, sole breadwinner of the family, under debt and had been convicted for a similar offence. Magistrate enquired under Section 35 of the National Road Traffic Act, 1996 as a consequence of which his driving licence was suspended.

The issue before the Court was to see if an agreement formed according to Section 105-A of the Criminal Procedure Act, 1977 regarding the suspension of accused driving licence for a period of time without any enquiry by Court under Section 35 was required to be dispensed with.

Appellant contended that the magistrate was misdirected when he unilaterally altered the terms of plea and sentence agreement related to the period of suspension without informing the parties of proceedings of his intention to do the same based on the finding in the case of  State v. DJ, 2016 (1) SACR 377 (SCA).  The above contention led to the question of whether the magistrate could have done so.

High Court agreed with the findings of the case of S v. Lourens, 2016 (2) SACR 624 (WCC) and accordingly observed that enquiry under Section 35 was an important part so as to determine the sentence. Magistrate erred in concluding above provision as a post-sentence procedure and he should have followed Section 105-A (9). Therefore, appellant’s conviction and sentence ought to be set aside and the matter was remitted back to District Court Mitchells Plain for trial de novo before another magistrate. [Micheal Muller v. State, 2018 SCC OnLine ZAWCHC 2, dated 16-11-2018]

 

Case BriefsForeign Courts

Supreme Court of Democratic Republic of Sri Lanka: A Bench comprising of S. Eva Wanasundera PCJ, H.N.J. Perera and Murdu Fernando, JJ., set aside the judgment of the lower courts, and granted the relief sought by the plaintiffs in the present case.

The pertinent facts of the case are that the defendant had come into the ownership of two small allotments of land by means of a title deed, which was duly attested by the notary public. She had transferred the same to a third party named Premlatha for a purchase price of Rs. 500,000, as stated by the notary public. Premlatha, by means of another deed, transferred the said property to the plaintiff. On the very same day on which this transfer took place, the plaintiff entered into a lease agreement in favour of the defendant, which was for a period of two years and the lease amount was Rs. 12000 per year, which the defendant agreed to pay in installments of Rs. 500 every month. After the expiry of the lease period, the defendant had refused to move out, as a result of which the plaintiffs filed an action for ejection against the defendant. In the trial, the defendant had presented evidence, but had not been present for cross examination. In spite of the same, the district court had reserved the case for judgment, and further dismissed the plaint but did not grant the relief prayed for by the defendant. The High Court had upheld the decision of the District Judge. The contention of the defendant was that the transfer of the property to Premlatha was in the nature of a transaction of security, for which the defendant was paying interest, and as she had failed to ‘pay the loan’, she was unable to get the property retransferred to herself. The transaction between the defendant and Premlatha was in the nature of a trust, as the defendant never intended to pass the title of the property. The defendant was a witness to the deed which was signed between Premlatha and the plaintiff, and thus it is evident that there was no intention on the part of the defendant to retain her status as owner of the property, as the deed was for the sale of the property, for a consideration of Rs. 6 lakhs. The contention that the plaintiff was holding the property in trust for the defendant was also rejected by the court, which stated that ‘holding in trust’ is a concept which cannot pass or be transferred from one person to another.

The court placed reliance on the case of Dr. Rasiah Jeyarajah v. Yogambihai Thambirajahnee-Renganathan Pillei, 2015 SCC OnLine SL SC 8, to state that the plaintiff was entitled to evict the defendants from the property upon the conclusion of the lease agreement, and that there was no need to prove title over the premises. The plaintiff was not obligated under law to provide notice of termination of lease and license, contrary to what was held by the High Court.

Accordingly the appeal was allowed with costs and the judgment of the District Court and the Civil Appellate High Court set aside. [Hallewa Mangalika Jayasinghe v. Udeni Bandara Jayasinghe, SC Appeal 183/2016, order dated 28.09.2018]

Legislation UpdatesRules & Regulations

G.S.R. 644(E).—In exercise of the powers conferred by Section 44 of the Arms Act, 1959 (54 of 1959), the Central Government hereby makes the following rules further to amend the Arms Rules, 2016, namely:

1.These rules may be called the Arms (Second Amendment) Rules, 2018.

2. In the Arms Rules, 2016,-

(a) for sub-rule (2), the following sub-rule shall be substituted, namely:

“(2) Every licensing authority and the renewing authority shall also enter such data in the NDAL system which shall generate a unique identification number (UIN) and with effect from the 1st day of April, 2019, any arms license without UIN shall be considered invalid.”;

(b) for sub-rule (4), the following sub-rule shall be substituted, namely:

“(4) Any existing licensee holding multiple licenses in Form III shall on or before the 1st day of April, 2019, make an application for grant of a single license in respect of all the firearms held by him under his UIN, to the concerned licensing authority:

Provided  that  where  the  applicant  applying  a  license  for  restricted  category  of  arms  or ammunition specified in Schedule I is also a holder of a licence for permissible category of arms or ammunition specified in the said Schedule; or where the applicant, applying for permissible category of arms or ammunition is also a holder of a licence for restricted category or arms or ammunition specified in the said Schedule, the licensing authority concerned shall issue a new licence for such restricted or permissible category of arms or ammunition, as may be applicable, under the existing UIN of the licensee;

Provided further that separate licence books shall be generated in case of each licence in Form II, Form  III  and  Form  IV  and  in  case  of  a licence  in  Form  III,  separately  for  restricted  and permissible categories of arms and ammunition specified in Schedule I, with an over all ceiling of three firearms under a single UIN”.

[F. No. V-11026/133/2017-Arms]

Note: Principal rules were published in the Gazette of India, Extraordinary, Part II, Section 3, sub-section (i) dated the 15th July, 2016 vide G.S.R. 701(E), dated the 15th July, 2016 and subsequently amended vide G.S.R. 1468(E), dated the 28th November, 2017 and G.S.R. 624(E), dated 11th July, 2018.

Ministry of Home Affairs

 

 

Case BriefsHigh Courts

Calcutta High Court: A Division Bench has ruled that in cases of granting a license to run liquor shops, the licensing authority must work in accordance with the rules in force at the given time and not those which may have been in force when the application for such license was first made to the said authority.

The appellant had made an application under the Bengal Excise Act to run a liquor shop from rented premises in March 2004. The respondent, a co-owner of the shop filed objections to the shop being run from its premises but the same was ignored and the license was granted in 2004. The appeal of the present respondents was rejected and so was a revisionary application.

Writ was then filed before a Single Judge Bench where it was submitted that under the West Bengal Excise (Selection of New Sites and Grant of Licence for Retail Sale of Liquor and Certain Other Intoxicants) Rules, 2003, operation of liquor shops in the vicinity of schools etc. was prohibited, vicinity is defined as 300 feet. This distance, however, was increased to 1000 feet vide an amendment in April 2004.

Hence the issue for consideration was that was the license granted to the appellant under the old rules (300 feet) tenable for the sole reason that the application for the license was made when the old rules were in force, even though the order actually granting the license was passed when the new rules (1000 feet) were in force.

The Single Judge held that it was settled law that where a license was to be granted, the authority concerned must do so in light of the existing rules, hence the decision of the revisional authority was overturned. This order of the Single Judge came to be challenged in this appeal before the division bench.

Jyotirmay Bhattacharya, CJ, referred to the case of State of Kerala v. Six Holiday Resorts Private Limited, (2010) 5 SCC 186 where the Supreme Court held that whether the issue was an amendment to existing rules or a change in policy, license for running liquor shops shall be granted only under rules in force when the application is being considered. The applicant has no right to claim that his application is considered under the rules in force when such application was made. Same was also held in Somdev Kapoor v. State of West Bengal, (2014) 14 SCC 486.

It was claimed by the appellant that the Single-Judge Bench had directed the licensing authority to grant the appellant the license, but the Court held that the Single Judge’s order was not a mandatory direction to actually grant the license under the unamended rules but a general direction to consider the grant of license. The appellant also relied upon a notification issued by the Excise Commissioner of West Bengal directing licensing authorities to not reject applications received before the publication of the amendment notification merely because they did not comply with the new norms. However, the Court rejected this contention, stating that the appellant was actually granted a license before the notification by the Excise Commissioner and hence the same could not be relied upon. Hence the Revisional Authority was directed to consider the application for a license in light of the amended rules and the application was disposed of. [Sumita Dutta v. Principal Secretary of Excise, 2018 SCC OnLine Cal 2381, decided on 16-05-2018]

Case BriefsHigh Courts

Madhya Pradesh High Court: The Court entertained a writ petition under Article 226 despite the availability of alternate remedies. The case before the Court was that license of the Petitioners, a kerosene dealership, was suspended without granting an opportunity to them. The petitioners claimed violation of natural justice as they had not been afforded the opportunity to put forward their side.

The Court accepted this petition despite the availability of alternate remedies on the ground that principles of natural justice had been violated, which fact had been admitted by both parties. The impugned order was set aside as ‘due process’ had not been followed while passing it. However, the respondents were given the liberty to proceed against the petitioner in accordance with law and the principles of natural justice. [M/s R.K. Dwivedi v. The State of Madhya Pradesh, 2017 SCC OnLine MP 1189, decided on 11.09.2017]

 

Case BriefsSupreme Court

Supreme Court: The Court, while deciding the question as to whether the Event Management Company/Event Organizer is required to seek licence from the lyricist and the musician for subsequently playing the song in public even after it has paid for the broadcasting of the song to the Sound Recording Company, held that though each of the seven sub-clauses of clause (a) of Section 14 of the Copyright Act, 1957 relating to literary, dramatic or musical work, are independent of one another, but reading these sub-clauses independently cannot be interpreted to mean that the right of producer of sound recording, who also comes under definition of author under Section 2(d)(v), and has a right to communicate his work to the public under Section 14(e)(iii) of the Act, is lost.  It was also held that in the assignment, normally, ownership of the copyright of the work is transferred but in the case of licence another person is allowed to use the work by the author.

Argument advanced on behalf of the appellants was that the permission granted to defendant was sans the right to communicate the sound recording to the public, was rejected by P.C. Pant, J and Ranjan Gogoi, JJ, on the ground that there appeared no such term and condition between the parties depriving the defendant from communicating his work of making song to the public. The Court made it clear that with effect from 21.06.2012, in view of sub-section (10) of Section 19 of the Act, the assignment of the copyright in the work to make sound recording which does not form part of any cinematograph film, shall not affect the right of the author of the work to claim an equal share of royalties or/and consideration payable for utilization of such work in any form by the plaintiff/respondent.

Considering the fact that sub-section (10) of Section 19 was inserted with effect from 21.06.2012 vide Act No. 27 of 2012, which did not exist on the day the plaint was filed before trial court in the year 2006, the Court agreed with the decision of the Delhi High Court where it was held that the defendants do not have to secure a license from the appellants, as such rights as exist w.e.f. 21.06.2012 were not the same prior to it.

The High Court had held that in case the defendants wish to perform the sound recording in public, i.e. play them, a license from Phonographic Performing Rights Society (PPRS) is essential; in case the musical works are to be communicated or performed in the public, independently, through an artiste, the license of Indian Performing Rights Society (IPRS) is essential. In case the defendant wishes to hold an event involving performances or communication of works of both kinds to the public, the license or authorization of both IPRS and PPRS are necessary. The High Court, hence, restrained the defendant from communicating any of such works to the public, or performing them, in the public, without such appropriate authorization, or licensing pending adjudication of the suit [International Confederation of Societies of Authors and Composers v. Aditya Pandey, 2016 SCC Online 967, decided on 20.09.2016]