Case BriefsSupreme Court

Supreme Court: The 3-judge bench of SA Bobde, CJ and AS Bopanna and V. Ramasubramanian, JJ has stayed the Allahabad High Court judgment issuing directions for “lockdown” in the State of Uttar Pradesh but has directed that the State Government to “immediately” report to the High Court about the steps it has taken and proposes to take in the immediate future within a period of one week in view of the current pandemic.

The Court has appointed Senior Advocate P.S. Narasimha as Amicus Curiae and has listed the matter after 2 weeks.

Solicitor General Tushar Mehta, appearing for the State had argued before the Court that the State Government has issued several directions to contain the spread of Corona Virus and are taking adequate precautions at their own and that the directions issued by the High Court vide the impugned order are as rigorous as a lockdown though the High Court has observed that “they are nowhere close to a complete lockdown”.

Yesterday, the Allahabad High Court had said that it was their constitutional duty to save innocent people from the pandemic and in order to break the chain of COVID-19 pandemic, people are to be restrained from going outside their homes for a week.

It said that,

“Those in the helm of affairs of governance are to be blamed for the present chaotic health problems and more so when there is a democracy which means a government of the people, by the people and for the people. It is a shame that while the Government knew of the magnitude of the second wave it never planned things in advance.”

While the High Court said that the directions issued by it were “nowhere close to a complete lockdown”, it remarked,

In this order if we have not imposed a lockdown it does not mean that we do not believe in it. We are still of the view that if we want to break the chain a lockdown for a duration of at least two weeks is a must.”

[State of Uttar Pradesh v. High Court of Judicature at Allahabad, 2021 SCC OnLine SC 336, order dated 20.04.2021]


For Petitioner(s): SG Tushar Mehta, AAG Garima Prashad, Adv. Rajat Nair and AOR Abhinav Agrawal

For Respondent(s): AOR Talha Abdul Rahman

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“Govt. is to blame for chaos; Harsh steps necessary before pandemic spirals to engulf entire population”: All HC orders closing of all establishments (exceptions listed) till 26th April in select districts, asks Govt. to consider complete lockdown for entire State

Case BriefsCOVID 19High Courts

Delhi High Court: The Division Bench of Vipin Sanghi and Rekha Palli, JJ., while addressing the present petition expressed that:

COVID-19 pandemic is presently raging with much greater intensity than prevalent at the time when this petition was initiated in the year 2020.

It has been noted that the number of COVID-19 positive patients, as reported on a daily basis has exceeded 25,000 in the NCT of Delhi.

Court observed that the test positivity rates (TPR) are rising continually, with around 1/3rd of all districts in the country having a positivity rate of more than 10%. The TPR was more than 13% as on 15.04.2021. According to medical estimates, around 15 to 20% of these patients could require hospital admissions, with a quarter of them requiring specialized ICU care.

Above position translates to a requirement of roughly 50,000 beds daily in the country, which has already pushed the limited health care system beyond its limits.

It is evident that the health care infrastructure is on the verge of an imminent and complete collapse.

It was stated that GNCTD is being unreasonable and unmindful of the limitations of men, infrastructure and equipment available to deal with the massive surge in COVID-19 positive cases.

Bench observed that because of the large numbers of samples, labs that have been entrusted with the job of collecting and analyzing samples of COVID-19 through RT PCR Tests are already hard pressed. Court stated that it does not serve the interest of any such lab to delay the reports deliberately or negligently.

Hence, Court added that it hopes and expects:

  • all the labs to continue to work efficiently and diligently in order to prepare and provide the reports of the tests conducted by them at the earliest humanly possible.
  • None of the accredited labs would refuse to take samples on account of the rush, if they are otherwise in a position to collect the samples.

Another issue before the Court was with respect to the shortage of supply of medical oxygen which is a critical requirement for treatment of serious patients of COVID-19. Mr Mehra pointed that the Central Government had already issued orders that, except to meet the needs of a few industries, the supply of oxygen manufactured in the country should be provided for medical use in the country.

He further added that:

“…shortage of oxygen may result in steep rise in loss of lives.” 

Bench stated that let Central Government look into the above matter on an urgent basis.

It was submitted that M/s INOX, which has existing contracts with hospitals in Delhi, is diverting the oxygen produced by it to other states.

To the above issue, High Court directed INOX to honour its contracts with the GNCTD and hospitals in Delhi and restore the supply of 140 MT of oxygen immediately – which shall, in turn, be distributed to the needy hospitals of Delhi.

Central Government should examine the availability of oxygen in different states in the country in the context of the spread of the pandemic so that oxygen could be made available to the areas where it is most required, looking at the surge in covid cases.

 High Court directed Centre and GNCTD to file affidavits disclosing – in respect of hospitals manages by them, hospital-wise, the number of COVID beds reserved, further how many ICU Beds with or without ventilator and with or without oxygen supply.

Affidavits should also state as to how many COVID beds have been allocated by the Central Government to GNCTD in ICU/non-ICU and with/ without ventilators, and with, or without, oxygen.

Another aspect which the Court highlighted was the plight of daily wagers and migrant labour force as was seen in the year 2020 on imposition of lockdown. It has been noted that a lot of them have started going back to their origin states with the surge in COVID cases in the GNCTD.

“…daily wagers – who are hand to mouth, and earn their bread everyday to feed themselves and their families, are once again faced with the grim reality of facing shortage of even basic necessities such as food, clothing and medication, due to the curfew imposed till 26th April, 2021.”

Bench remarked that:

GNCTD failed to utilize thousands of crores of rupees they are sitting on, which is available with the Board constituted under the Building and Other Construction Workers (Regulation of Employment and Conditions of Service) Act, 1996, and which has been collected as Building cess for construction workers. The registration of lakhs of building workers – which had lapsed on account of non-renewal, were not provided any ex gratia payment.

GNCTD to ensure that the above stated Board shall utilize the monies lying with it, inter alia, to provide food, medicines and other necessities to the needy construction workers at their respective work sites.

Provision of Food

Lastly, the Court held that for the purpose of providing food, the GNCTD should utilise the contractors engaged for providing mid-day meals to school children in Government and MCD Schools, since the schools are not operational currently, and that facility could still be utilized for the aforesaid purpose. The Chief Secretary, Delhi shall ensure the implementation of this direction without any delay.

Matter shall be taken up today post-lunch session. [Rakesh Malhotra v. GNCTD, 2021 SCC OnLine Del 1800, decided on 19-04-2021]


Advocates before the Court:

For the Respondents:

Mr Satyakam, ASC, for the GNCTD/ respondent Nos. 1 & 2.

Mr Rahul Mehra, Standing Counsel (Crl.) for GNCTD.

Ms Monica Arora, Adv. for Mr Chetan Sharma, ASG

COVID 19Hot Off The PressNews

District Collector, Bilaspur vide an Order dayed 18-04-2021 extended the lockdown in Bilaspur District where the High Court is situated, till 26-04-2021.

In light of the aforesaid order dated 18-04-2021 of the District Collector, Bilaspur and in compliance of Order No. 73(Mis)/II-14-1/2021, dated 12.04.2021 of this Registry, the limited functioning of the High Court of Chhattisgarh shall stand extended till 26-04-2021.

In view of the above, the cases already listed in the cause list for 22.04.2021 shall be taken up on 27.04.2021.

The cases which are extremely urgent in nature may be mentioned before the Registrar (Judicial)/ Additional Registrar (Judicial) as per the practice prevalent in the High Court during holidays.

Link to the NOTIFICATION.


Chhattisgarh High Court

Notification dt. 19-04-2021

Case BriefsCOVID 19High Courts

Allahabad High Court: The Division Bench of Ajit Kumar and Siddhartha Varma, JJ.,  while holding that its’ their constitutional duty to save innocent people from the pandemic and in order to break the chain of COVID-19 pandemic, people are to be restrained from going outside their homes for a week, expressed that:

Those in the helm of affairs of governance are to be blamed for the present chaotic health problems and more so when there is a democracy which means a government of the people, by the people and for the people.

It is a shame that while the Government knew of the magnitude of the second wave it never planned things in advance.

Recent surge in the COVID-19 pandemic has virtually incapacitated the medical infrastructure in the State of U.P. and especially in cities like Prayagraj, Lucknow, Varanasi, Kanpur and Gorakhpur.

“…pandemic is teasing the system in a situation where patients have outnumbered the hospital beds and people are just running from pillar to post and in this process attendants of patients are not only getting infected but others in public are also getting infected and a complete chain has got formed.”

Court stated that before the pandemic spirals to engulf in it the entire population of these badly hit districts, it is necessary to take some harsh steps in larger public interest.

Further, the Bench remarked that it understands the limitation of the government in creating infrastructure to meet the challenge of COVID-19 and at the moment efforts are afoot to create the same but before all the efforts are translated into action much water would have flown under the bridge to the utter dismay of a large population of have nots.

“…in a democracy there are legitimate expectations from the government to adopt measures to meet public health issues like all other issues of public interest. Public interest expects judiciary to remain vigilant to all the issues which if not addressed to in time, will result in the failure of the system which is meant to safeguard public interest.”

Adding to the above, High Court stated that if people die of pandemic in a large number due to paucity of sufficient medical aid it would be the governments to blame that failed to counter the pandemic even after one long year of experience and learning. One would only laugh at us that we have enough to spend on elections and very little to spend on public health.

Calling early testing scheme or plan a farce, Court elaborated stating that the reports are neither updated before 72 hours nor, samples are taken care of, owing to the shortage of manpower. Only VVIPs have been getting the reports within 6-12 hours.

Economy, economy and economy is the only tune that the government is all the time harping upon, but bread and butter if you take to a person who needs oxygen and medication, it will be of no use to him.

Pomp show of Development

Calling out the Government, Bench expressed that if hospitals’ staff and medicos go ill for the relentless services to cure people in the pandemic, people would start losing their lives and all pomp and show of development would be of no avail.

Looking at the present situation, Court stated that night curfew in the name of Corona Curfew and Weekend Curfew are nothing else but a mere eyewash.

Not being satisfied with the Government efforts, Court stated that people are largely not following the Court’s Order for putting masks on their faces nor, the police could ensure 100% masking till date.

Due to the elections being conducted, police was virtually shifted to polling places giving priority to election above public health.

No Social Distancing

High Court stated that on many occasions in various political rallies masks were never worn by people. In our considered view action is liable to be taken against the organisers who did not anticipate such eventualities under the Uttar Pradesh Public Health Epidemic Diseases Act, 2020 and/ or any other relevant Act in force.

Admission of patients to ICUs have been largely done on the recommendations of VIPs. Even supply of life saving anti-viral drug namely Remdesivir is being provided only on the recommendation of VIPs. VIPs and VVIPs are getting their RT-PCR report within 12 hours, whereas, ordinary citizen is kept waiting for such reports for two to three days and thus, spreading further infection to other members of his/her family.

If popular government has its own political compulsions in not checking public movements during this pandemic, we cannot remain mere passive spectators.

We can’t shirk away from our constitutional duty to save innocent people from the pandemic which is spreading due to the negligence of a few.

Direction passed by the Court:

  • All establishments be it government or private, except financial institutions and financial departments, medical and health services, industrial and scientific establishments, essential services including municipal functions, and public transport, shall remain closed till 26th April, 2021. The judiciary will, however, function on its own discretion;
  • All shopping complexes and malls shall remain closed till 26th April, 2021;
  • All grocery shops and other commercial shops excluding medical shops, with more than three workers, shall remain closed till 26th April, 2021;
  • All hotels, restaurants and even the small eating points on thelas etc. shall remain closed till 26th April, 2021;
  • All institutions like educational institutions and other institutions relating to other disciplines and activities be it government, semi-government or private shall remain closed including for their teachers and instructors and other staff till 26th April, 2021 (this direction is for the whole of Uttar Pradesh);
  • No social functions and gatherings including marriage functions shall be permitted till 26th April, 2021. However, in case of already fixed marriages a necessary further permission would have to be taken from the District Magistrate of the concerned district. Gatherings would be limited to 25 persons and the district magistrate concerned shall take a decision after giving due consideration to the prevailing situation of the impact of Covid 19 including notification of containment zones in the area where such marriage has to take place;
  • All religious activities in public of any kind is directed to remain suspended till 26th April, 2021;
  • All religious establishments of any kind are directed to remain closed till 26th April, 2021;
  • All hawkers including fruits and vegetable vendors, milk vendors and bread vendors, shall go off the road by 11 AM every day till 26th April, 2021;
  • Containment zones shall be notified every day in two leading Hindi and English newspapers having wide circulation in the districts of Prayagraj, Lucknow, Varanasi, Kanpur Nagar/ Dehat and Gorakhpur.
  • All public movements on roads would remain restricted completely, subject to above directions. Movements would be only allowed in case of medical help and emergencies.
  • In addition to the above directions, we direct the State Government to go robust for implementing the current vaccination programme.

Court directed for the order to be sent to Chief Secretary, Government of Uttar Pradesh today to enforce the above directions from the night of 19-04-2021 till 26-04-2021 in the cities of Prayagraj, Lucknow, Varanasi, Kanpur Nagar, and Gorakhpur.

Our above directions are nowhere close to a complete lockdown. 

While concluding the High Court remarked that:

In this order if we have not imposed a lockdown it does not mean that we do not believe in it. We are still of the view that if we want to break the chain a lockdown for a duration of at least two weeks is a must.

 Government shall consider the imposition of a complete lockdown in the entire state.

Matter to be put up again on 26-04-2021. [In-Re Inhuman Condition At Quarantine Centres And For Providing Better Treatment To Corona Positive v. State of U.P., 2021 SCC OnLine All 273, decided on 19-04-2021]

COVID 19Hot Off The PressNews

COVID-19 Surge

  • In view of the upsurge in the COVID-19 Cases, Chhattisgarh High Court has suspended the normal functioning of the High Court with minimum support staff to be deputed on a rotational basis to deal with extremely urgent cases as to be decided either by the Chief Justice or the Judge nominated by the Chief Justice.
  • No Filing of fresh cases will be allowed.
  • The above period will not be counted for the working out limitation period.
  • Officer/Officials of the High Court shall work from home during the above period.
  • Registrar General shall call for the staff as may be required for the skeletal functioning of the High Court.
  • The Offices/Officials will not leave the Headquarter and will report to duty without any lapse.
  • If Collector and District Magistrate extends lockdown in Bilaspur District beyond the aforesaid period then the present arrangements regarding the functioning of High Court will be continued.

Link to the notice.


 

Case BriefsHigh Courts

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

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

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

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

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

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

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

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

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

Decision

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

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

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

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

Difference between salons and spas

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

Hence,

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

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

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

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

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


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

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

Case BriefsSupreme Court

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

Background

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

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

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

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

Observations

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

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

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

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

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

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

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

 Decision

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

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

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

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


*Justice Ashok Bhushan has penned the judgment

COVID 19Op EdsOP. ED.

1. INTRODUCTION

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

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

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

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

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

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

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

2.2 Obligations of Employers with Regard to the COVID Circulars

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

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

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

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

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

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

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

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

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

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

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

(i) the nature of the business;

(ii) the type of workers employed; and

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

3. JUDICIAL PRECEDENTS AND SUBSEQUENT RELAXATIONS BY RELEVANT GOVERNMENTAL AUTHORITIES

3.1 Judicial Precedents

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

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

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

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

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

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

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

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

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

3.3. Subsequent Relaxations by Various State Governments

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

4. CONCLUSION

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

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

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

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

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

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

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

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

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

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


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

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

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

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

[3] The Companies Act, 2013

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

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

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

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

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

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

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

[11]2004 SCC OnLine Bom 139

[12]  2018 SCC Online SAT 99.

[13] (2014) 16 SCC  1 

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

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

[16] (2020) 4 SCC 810

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

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

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

COVID 19Hot Off The PressNews

The University Grants Commission framed and issued Guidelines for the universities and colleges for reopening their campuses.

These Guidelines have been vetted by the Ministry of Health & Family Welfare and approved by the Ministry of Home Affairs and the Ministry of Education. The Guidelines may be adopted by the institutions as per the local conditions and directives of the Government authorities.

The Universities and Colleges outside the containment zones may be opened in a graded manner after consultations with concerned State/UT Governments and subject to adherence to the guidelines/SOP for safety and health protocol prepared by UGC, as under:

  1. For Centrally Funded Higher Education Institutions, the Head of the Institution should satisfy herself/himself regarding the feasibility of the opening of physical classes and decide accordingly.
  2. For all other Higher Educational Institutions, e.g., State Universities, Private Universities, Colleges etc., opening of physical classes to be done as per the decision of the respective State/UT Governments.
  3. Universities and colleges may plan opening the campuses in phases, with such activities where they can easily adhere to social distancing, use of face masks and other protective measures This may include administrative offices, research laboratories and libraries etc.
  4. Thereafter, students of all research programmes and post-graduate students in science & technology programmes may join as the number of such students is comparatively less and norms of physical distancing and preventive measures can be easily enforced.
  5. Further, final year students may also be allowed to join for academic and placement purposes, as per the decision of the head of the institution.

However, for (iii), (iv) and (v) above, it should be ensured that not more than 50% of the total students should be present at any point of time and necessary guidelines/protocols to prevent the spread of COVID-19 are in place.

  1. For the programmes, other than those mentioned in paras (iv) and (v) above, online/distance learning shall continue to be the preferred mode of teaching and shall be encouraged.
  2. However, if required, students may visit their respective departments in a small number for consultation with the faculty members, after seeking prior appointments to avoid crowding, while maintaining physical distancing norms and other safety protocols.
  3. Some students may opt not to attend classes and prefer to study online while staying at home. Institutions may provide online study material and access to e-resources to such students for teaching-learning.
  4. Institutions should have a plan ready for such international students who could not join the programme due to international travel restrictions or visa-related issues. Online teaching-learning arrangements should also be made for them.
  5. Hostels may be opened only in such cases where it is necessary while strictly observing the safety and health preventive measures. However, the sharing of rooms may not be allowed in hostels. Symptomatic students should not be permitted to stay in the hostels under any circumstances.
  6. Before the reopening of any campus, the Central or concerned State Government must have declared the area safe for opening of educational institutions. The directions, instructions, guidelines and orders issued by the Central and concerned State Government regarding safety and health in view of COVID-19 must be fully abided by the higher education institutions.

These Guidelines provide in detail the measures to be taken by Higher Educational Institutions before re-opening of campuses. It also describes the safety measures to be taken by HEIs at Entry/Exit Point(s), in the classrooms and other learning sites, inside the campus and in the Hostels. Guidance for counselling and mental health is also provided in this document.

Earlier, the University Grants Commission issued “Guidelines on Examinations and Academic Calendar for the Universities in View of COVID-I9 Pandemic and Subsequent Lockdown” on 29th April, 2020 and then, on 6th July, 2020. These Guidelines covered important dimensions related to examinations, academic calendar, admissions, online teaching-learning, and provided flexibility for adoption by the universities.

Later, “UGC Guidelines on Academic Calendar for the First Year of Under-Graduate and Post-Graduate Students of the Universities for the Session 2020-21 in View of COVID-19 Pandemic” were issued on 24th September, 2020.

Click here for the detailed UGC guidelines for Re-opening the Universities and Colleges Post Lockdown

Click here for the salient features of UGC guidelines for Re-opening the Universities and Colleges Post Lockdown


Ministry of Education

[Press Release dt. 05-11-2020]

[Source: PIB]

Case BriefsHigh Courts

Himachal Pradesh High Court: Anoop Chitkara J., considering the peculiar facts of the present case, allows anticipatory bail to a proclaimed offender, imposing several conditions.

 Brief Facts

On the allegations made by a girl, aged 15 years, against the petitioner of having coitus with her at the end of May 2013, by entering her home and also committing rape on her in the forest on 30-06-2013, when she was returning from school, the police registered FIR dated 19-07-2013, under Sections 376, 506 of the Penal Code, 1860, and Section 4 of Protection of Children from Sexual Offences Act, 2012, disclosing cognizable and non-bailable offences.

The police conducted the investigation, took the victim for her medical examination, got her statement recorded under S. 164 CrPC, but failed to nab the accused. Subsequently, the police filed a charge sheet without arresting the accused. After taking cognizance of the offence, the Court issued Non-bailable Warrants (NBW) and upon its non-execution, allowed the application of the prosecution and proceeded against the accused under Section 82 CrPC, declaring the petitioner as a proclaimed offender. It is to be noted that the contents of the bail petition and the status report do not reveal any criminal history.

Counsel for the petitioner

Abhilasha Kaundal, Counsel for the petitioner contends that incarceration before the proof of guilt would cause grave injustice to the petitioner and family. Further, the conduct of the accused applicant must be taken into account as much as, being declared a proclaimed offender, the petitioner voluntarily approached this Court by filing a petition for anticipatory bail. Accused explains that he and the victim were in love, and to make out an exceptional case, further states that on noticing that the girl had an affair with one Jyoti Prakash, he became melancholic and left for a distant place, far away from her. Accused further contends that due to the Lockdown of the COVID-19 pandemic, he was forced to return home and got information that an FIR was lodged against him, and that he is a proclaimed offender.

Counsel for the respondent

While opposing the bail, Nand Lal Thakur, Additional Advocate General contended that an absconder whom the Court has declared as a proclaimed offender has no legal rights to file an application under Section 438 CrPC.

Opinion of the Amicus

Ashok Tyagi, Amicus Curiae carved out a distinction in the pronouncements of Supreme Court and states that this Court has the jurisdiction to grant anticipatory bail, in peculiar facts, even to a proclaimed offender.

 Observations

The Court, in addition to its decision, cited the following cases;

  • Lavesh v. State (NCT of Delhi), (2012) 8 SCC 730, on the position of anticipatory bail against a proclaimed offender; “Para 10. (…)Normally, when the accused is ‘absconding’ and declared as a ‘proclaimed offender’, there is no question of granting anticipatory bail. We reiterate that when a person against whom a warrant had been issued and is absconding or concealing himself in order to avoid execution of warrant and declared as a proclaimed offender in terms of Section 82 of the Code is not entitled the relief of anticipatory bail.”
  • State of Madhya Pradesh v. Pradeep Sharma, (2014) 2 SCC 171, reiterated the rationale of the aforementioned case.
  • Kalyan Chandra Sarkar v. Rajesh Ranjan, (2005) 2 SCC 42, A three-member bench of Supreme Court held that the persons accused of non-bailable offences are entitled to bail, if the Court concerned concludes that the prosecution has failed to establish a prima facie case against him, or despite the existence of a prima facie case, the Court records reasons for its satisfaction for the need to release such persons on bail, in the given fact situations. The rejection of bail does not preclude filing a subsequent application, and the Courts can release on bail, provided the circumstances then prevailing requires a change in fact or situation. 
  • Dataram Singh v. State of U.P., (2018) 3 SCC 22, “…grant or refusal of bail is entirely within the discretion of the judge hearing the matter and though that discretion is unfettered, it must be exercised judiciously and in a humane manner and compassionately. Also, conditions for the grant of bail ought not to be so strict as to be incapable of compliance, thereby making the grant of bail illusory. The possibility of the accused influencing the course of the investigation, tampering with evidence, intimidating witnesses, and the likelihood of fleeing justice, can be taken care of by imposing elaborative conditions and stringent conditions.”
  • Sushila Aggarwal v. State (NCT of Delhi), (2020) 5 SCC 1, A Constitutional Bench held that unusually, subject to the evidence produced, the Courts can impose restrictive conditions on the grant of bail.

Decision

In the light of the precedent cited and the facts of the case, the Court allowed the bail application remarking, “Pre-trial incarceration needs justification depending upon the offense’s heinous nature, terms of the sentence prescribed in the statute for such a crime, probability of the accused fleeing from justice, hampering the investigation, criminal history of the accused, and doing away with the victim(s) and witnesses. The Court is under an obligation to maintain a balance between all stakeholders and safeguard the interests of the victim, accused, society, and State. However, while deciding bail applications, the Courts should discuss evidence relevant only for determining bail. The difference in the order of bail and final judgment is similar to a sketch and a painting. However, some sketches are in detail and paintings with a few strokes.” Moreover, the Court enumerated a list of conditions that the applicant must abide by, during the course of bail.[Mahender Kumar v. State of Himachal Pradesh, 2020 SCC OnLine HP 2119, decided on 26-10-2020]


Sakshi Shukla, Editorial Assistant has put this story together

COVID 19Hot Off The PressNews

Ministry of Home Affairs (MHA) issued an Order today to extend the Guidelines for Re-opening, issued on 30-09-2020, to remain in force upto 30-11-2020

Re-opening of activities outside the Containment Zones

    • Since the issuance of the first Order on lockdown measures by MHA on 24th March 2020, almost all activities have been gradually opened up in areas outside the Containment Zones. While most of the activities have been permitted, some activities involving large number of people, have been allowed with some restrictions and subject to SOPs being followed regarding health and safety precautions. These activities include – metro rail; shopping malls; hotel, restaurants and hospitality services; religious places; yoga and training institutes; gymnasiums; cinemas; entertainment park etc.
    • In respect of certain activities, having relatively higher degree of risk of COVID infection, State/ UT Governments have been permitted to take decisions for their re-opening, based on the assessment of the situation and subject to SOPs. These activities include – schools and coaching institutes; State and private universities for research scholars; allowing gatherings above the limit of 100 etc.
    • After the last guidelines issued by MHA on 30.09.2020, the following activities are also permitted but with certain restrictions:
  1. International air travel of passengers as permitted by MHA.
  2. Swimming pools being used for training of sportspersons.
  3. Exhibitions halls for Business to Business (B2B) purposes.
  4. Cinemas/ theatres/ multiplexes upto 50% of their seating capacity.
  5. Social/ academic/ sports/ entertainment/ cultural/ religious/ political functions and other congregations, in closed spaces with a maximum of 50% of the hall capacity and subject to a ceiling of 200 persons.

The further decision regarding the above activities will be taken based on the assessment of the situation

COVID-Appropriate behavior

    • The essence behind graded re-opening and progressive resumption of activities is to move ahead. However, it does not mean the end of the pandemic. There is a need to exercise abundant caution by adopting COVID-19 appropriate behavior by every citizen in their daily routine. A ‘Jan Andolan’ was launched by the Prime Minister, Shri Narendra Modi on 8th October 2020 on COVID-19 appropriate behavior to follow three mantras, namely:
  1. wear your mask properly;
  2. wash your hands frequently; and
  3. maintain a safe distance of 6 feet.
    • There is an urgent need to instil a sense of discipline and ownership amongst citizens in order that the resumption of activities is successful and gains made in the management of the pandemic are not diluted.
    • MHA has already advised Chief Secretaries/ Administrators of all States/ UTs that they should endeavour to promote COVID-19 appropriate behavior extensively at the grass root level and take measures to enforce the wearing of masks, hand hygiene and social distancing.

National Directives for COVID-19 management

  • National Directives for COVID-19 management shall continue to be followed throughout the country, so as to enforce COVID-19 appropriate behavior.

Strict enforcement of lockdown in Containment Zones till 30th November 2020

  • Lockdown shall continue to be implemented strictly in the Containment Zones till 30th November, 2020.
  • Containment Zones shall be demarcated by the District authorities at micro-level after taking into consideration the guidelines of MoHFW with the objective of effectively breaking the chain of transmission. Strict containment measures will be enforced in these containment zones and only essential activities will be allowed.
  • Within the containment zones, strict perimeter control shall be maintained and only essential activities allowed.
  • These Containment Zones will be notified on the websites of the respective District Collectors and by the States/ UTs and information will also be shared with MOHFW.

States not to impose any local lockdown outside Containment Zones

  • State/ UT Governments shall not impose any local lockdown (State/ District/ sub-division/City/ village level), outside the containment zones, without prior consultation with the Central Government.

No restriction on Inter-State and intra-State movement

  • There shall be no restriction on inter-State and intra-State movement of persons and goods.No separate permission/ approval/ e-permit will be required for such movements.

Protection for vulnerable persons

  • Vulnerable persons, i.e., 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 meeting essential requirements and for health purposes.

Use of AarogyaSetu

  • The use of AarogyaSetu mobile application will continue to be encouraged.

Ministry of Home Affairs

[Source: PIB]


Also Read:

[UNLOCK-5] MHA issues new Guidelines for Re-opening; Flexibility to States UTs for opening of schools

Case BriefsHigh Courts

Madras High Court: G.R. Swaminathan, J., directed the confiscated goods to be released on a provisional basis noting the delay on the part of Authorities in the adjudication of the matter.

Petitioner a dealer registered under the Goods and Services Tax Act who imports toys from China. It also purchases goods from Delhi-based dealers.

Dealer’s Stand

Dealer’s state that the returns till March 2020 have been filed and there are no arrears. Due to the lockdown restrictions amidst the pandemic, the business was shut down since April, 2020.

Following the partial lifting of restrictions, the petitioner reopened the business. Superintendent, CGST conducted a search at the petitioner’s place of business.

After the search operation, mahazar was drawn which was followed by a seizure order.

The said orders of seizure and prohibition issued by respondent 3 have been put to a challenge.

Analysis & Decision

Bench while addressing and analysing the issue, stated that,

Lord Atkin in his celebrated dissent in Liversidge v. Anderson, (1942) AC 206, proclaimed that laws speak the same language in war as in peace and that the words have only one meaning.

Likewise, laws speak the same language during normal as well as in pandemic times.

“…contemporary imperatives demand that courts, whenever possible, ought to adopt that approach which will kick- start the economy.”

Court also referred to Section 67 (1) and (2) of the Central Goods and Services Tax Act, 2017 which talks about the Power of inspection, search and seizure.

Supreme Court in ITO v. Lakhmani Mewal Das, (1976) 3 SCC 757, held that 

“…the existence of the belief can be challenged by the assessee but not the sufficiency of reasons for the belief. The expression “reason to believe” does not mean a purely subjective satisfaction on the part of the officer. It must be held in good faith. It cannot be merely a pretence. It is open to the Court to examine whether the reasons for the formation of the belief have a rational connection with or a relevant bearing on the formation of the belief and are not extraneous or irrelevant for the purpose of the section.”

Evading GST

In the present matter, the impugned proceedings were initiated based on the intelligence developed by CGST (HPU), Madurai that the petitioner is evading GST by mis-declaring the goods while importing.

It has been shown that the stock register was not maintained at the petitioner’s place of business, hence the Court doesn’t want to quash the seizure order, through the order of prohibition has to be necessarily interfered with.

No show-cause notice to date after the lapse of 40 days was issued.

In view of the above, Court stated that the respondent may not be in a hurry, they can afford to wait. Officials who get their salaries in the first week of every month may not be conscious of the cost of delays in such cases.

Further, the Court added that Adjudication proceedings may go on for months. That is why the statute provides for the provisional release of the detained goods.

Therefore, the Court directed the respondents to release the goods on a provisional basis and on taking a personal bond with a payment of Rs 2 lakhs.

While parting with its decision, Bench stated in regard to the Chinese products that,

“…general market is flooded with Chinese goods. The public must make a conscious choice to encourage swadeshi products.”

“The Indian entrepreneur must rise to the occasion. He must ask himself as to why the chinese products are preferred and he must come out with alternatives. There must be no compromise in quality. At the same time, the price factor should also be borne in mind.”

Petition was partly allowed in the above terms. [Tvl.Rising International Co. v. Commr. of Central GST and Central Excise,  2020 SCC OnLine Mad 2951, decided on 06-10-2020]

COVID 19Hot Off The PressNews

The National Human Rights Commission (NHRC), viewing the unprecedented situation across the country and being deeply concerned about the rights of the vulnerable and marginalised sections of the society affected by the COVID-19 pandemic and the resultant lockdowns, constituted a ‘Committee of Experts on Impact of Covid-19 Pandemic on Human Rights and Future Response’.

The Committee, included representatives from the civil society organizations, independent domain experts, and the representatives from the concerned ministries/ departments, and was tasked to assess the impact of the pandemic on realization of the rights of the people, especially the marginalised / vulnerable sections of the population which have been disproportionately impacted.

After due consideration of the impact assessment and recommendations made by the Committee of Experts, the Commission has now issued the ‘Advisory on Rights of Women in the context of COVID-19’, available on https://nhrc.nic.in/activities/reports-and-recommandations

The Commission has also requested to concerned Union Ministries and all States/UTs for implementation of the recommendations contained in the advisory and compliance the action taken report to the Commission.


National Human Rights Commission

Press Release dt. 08-10-2020

Case BriefsHigh Courts

Rajasthan High Court: Arun Bhansali, J., rejected a stay application that was filed aggrieved by the order of the Director, Mines demanding penalty, revoking sanction and passing debarring order against the petitioner.

It was submitted that the petitioner pursuant to the e-auction notification for collection of excess royalty and DMFT amount on masonry stone participated, being a petitioner was granted the contract and was required to fulfill the requirements as indicated successful bidder, However, on account of lockdown imposed due to COVID-19 pandemic, needful could not be done by the petitioner and he requested the respondents to grant time for fulfilling the requirements of the office wherein, he was required to do the needful within 15 days. Thus, the petitioner had sent a communication seeking extension of date for signing the agreement ‘without penalty’ which was responded to by the mining engineer who had asked to do the needful in 3 days along with the penalty. The petitioner again had asked for the waiver of penalty consequently the matter was forwarded to the Director, Mines for taking action under the provisions of Rule 45 of the Rajasthan Minor Mineral Concession Rules, 2017 (‘the Rules, 2017’). In the order passed by the Director the bid security amount was forfeited, the sanction was revoked and the petitioner was debarred from participating in the forthcoming auction.

The Court while rejecting the stay application explained that in the over all circumstances of the case where the formalities had to be completed in 15 days taking into consideration the effect of lockdown, and the prayer made by the petitioner seeking exemption from payment of amount of penalty was declined he was required to do the needful including payment of amount of penalty, the submission that as the communication was a recommendation only, the petitioner had no cause at that stage cannot be accepted inasmuch as insofar as the prayer made regarding exemption from payment of the amount of penalty is concerned stood rejected, which had provided cause to the petitioner. The Court added that the petitioner was not vigilant enough to seek his remedy in relation to the grievance as raised in the writ petition.[Bhaniyana Construction v. State of Rajasthan, 2020 SCC OnLine Raj 1386, decided on 30-09-2020]


Suchita Shukla, Editorial Assistant has put this story together

Case BriefsCOVID 19Supreme Court

Supreme Court: The 3-judge bench of Ashik Bhushan, R. Subhash Reddy, JJ has directed full refund of air tickets booked during lockdown period i.e. from 25th March, 2020 to 24th May, 2020 for travel during lockdown period. The order of the Court came after accepted Directorate General of Civil Aviation’s (DGCA) proposal of

To contain the pandemic situation of COVID¬19, lockdown was imposed by the Government of India, from 25th March 2020 to 14th April 2020 which was later extended upto 03rd May 2020.  A ban was also imposed on operation of all domestic and international flights. There was an issue of refund of air fare during the lockdown period, when domestic and international flights’ operation was suspended. The Ministry of Civil Aviation (MoCA), while acknowledging the unusual situation that has arisen due to the lockdown imposed, to contain further spread of COVID¬19 and its consequential effect on the air passengers and airlines, by examining the grievances received from various quarters, issued an advisory to all stake holders in civil aviation sector in the shape of Office Memorandum dated 16th April 2020.

The present writ petition was filed to declare the action on the part of the respondent-airlines, operating domestic as well as international flights in India, in not refunding the full amount collected for the tickets, due to the cancellation of flights in the wake of restrictions imposed by the Government of India to contain COVID-19 as arbitrary and in violation of Civil Aviation Requirements, issued by the Directorate General of Civil Aviation. A consequential relief was sought to direct the respondents to refund the full amount upon such cancellations.

The Court noticed that in ordinary course modalities and timelines for refund on cancellation of tickets are governed by, the Civil Aviation Requirements, i.e. CAR dated 22nd May 2008; 06th August 2010 as revised on 27th February 2019, and the said Requirements are issued by the competent authority in exercise of powers under the provisions of Aircrafts Act, 1934 and the Rules made thereunder.

It, however, said that

“… we cannot lose sight of the present situation prevailing in the country and across the globe, i.e. the effect of pandemic COVID-19.  It cannot be disputed that the civil aviation sector, which is one of the important sectors, is seriously affected in view of the ban imposed for operating flights. Added to the same, air passenger traffic has come down heavily and which is gradually being restored.  At this moment any strict enforcement action of the CARs would further restrict/reduce their operations and such enforcement action may further jeopardise the possibilities of generation of cash by airlines which can further adversely affect/delay the refund cycle. “

Strict enforcement of Civil Aviation Requirements at this moment may not yield any meaningful result for any stake holder.  Hence, in view of the suggestions and formulations arrived at in the meetings held by Union of India and DGCA, which are acceptable to the majority of stake holders, the Court directed that the same have to be implemented in letter and spirit since such formulations are workable solutions in these peculiar circumstances which are prevailing in the country.

DIRECTIONS ISSUED

  1. If a passenger has booked a ticket during the lockdown period (from 25th March, 2020 to 24th May, 2020) for travel during lockdown period and the airline has received payment for booking of air ticket for travel during the same period, for both domestic and international air travel and the refund is sought by the passenger against that booking being cancelled, the airline shall refund the full amount collected without any cancellation charges. The refund shall be made within a period of three weeks from the date of cancellation.
  2. If the tickets have been booked during the lockdown period through a travel agent for a travel within the lockdown period, in all such cases full refund shall be given by the airlines immediately. On such refund, the amount shall be passed on immediately by the agent to the passengers.
  3. Passengers who booked tickets at any period of time but for travel after 24th May, 2020 – refund of fares to the passengers covered under this category shall be governed by the provisions of Civil Aviation Requirements (CAR).
  4. Even for international travel, when the tickets have been booked on an Indian carrier and the booking is ex¬India, if the tickets have been booked during the lockdown period for travel within the lockdown period, immediate refund shall be made.
  5. If the tickets are booked for international travel on a foreign carrier and the booking is ex¬India during the lockdown period for travel within the lockdown period, full refund shall be given by the airlines and said amount shall be passed on immediately by the agent to the passengers, wherever such tickets are booked through agents. In all other cases airline shall refund the collected amount to the passenger within a period of three weeks.
  6.  In all other cases, the airlines shall make all endeavours to refund the collected amount to the passenger within 15 days from today. If on account of financial distress, any airline / airlines are not able to do so, they shall provide credit shell, equal to the amount   of   fare   collected,   in   the   name   of passenger when the booking is done either directly by the passenger or through travel agent so as to consume the same on or before 31st March, 2021.  It is open to the passenger either to utilize such credit etc. shell upto 31st  March, 2021 on any route of his choice or the passenger can transfer the credit shell to any person including the travel agent through whom he/she has booked the ticket and the airlines shall honour such a transfer.

The credit shell issued in the name of the passenger shall be transferable which can be utilize upto 31st  March, 2021 and the concerned airline shall honour such a transfer by devising a mechanism to facilitate such a transfer. It is also made clear that such credit shell can be utilized by the concerned agent through whom the ticket is booked, for third party use. It is also made clear that even in cases where credit shell is transferred to third party, same is to be utilized only through the agent who has booked the ticket at the first instance.

  1. In cases where passengers have purchased the ticket through an agent, and credit shell is issued in the name of passenger, such credit shell is to be utilized only through the agent who has booked the ticket. In cases where tickets are booked through agent, credit shell as issued in the name of the passenger which is not utilized by 31st March, 2021, refund of the fare collected shall be made to the same account from which account amount was received by the airline.
  2. In all cases where credit shell is issued there shall be an incentive to compensate the passenger from the date of cancellation upto 30th June, 2020 in which event the credit shell shall be enhanced by 0.5% of the face value (the amount of fare collected) for every month or part thereof between the date of cancellation and 30th June, 2020. Thereafter the value of the credit shell shall be enhanced by 0.75% of the face value per month upto 31st March, 2021.

[Pravasi Legal Cell v. Union of India, 2020 SCC OnLine SC 799, decided on 01.10.2020]

Case BriefsTribunals/Commissions/Regulatory Bodies

National Human Rights Commission India has taken suo motu cognizance of a media report that a 5-year-old girl has allegedly died due to starvation and ill health as the family was not able to get food and medicinal care for her in Agra district of Uttar Pradesh.

The Commission has issued a notice to the Chief Secretary of Government of Uttar Pradesh calling for a detailed report within 4 weeks including the relief and rehabilitation provided to the family by the administration and the action taken against the delinquent officials. The Chief Secretary is also expected to issue instructions to all the district authorities to ensure that such incidents of cruelty and negligence should not recur in future.

The Commission has observed that a five-year-old innocent girl has apparently died due to starvation and illness while a number of social welfare schemes run by the Central and the State Government do exist. During the period of lockdown, the government agencies have specifically introduced number of schemes for the poor, migrant labourers and other vulnerable sections of the society. The State Government has made several statements that they are committed to ensure Right to Food, Shelter and Livelihood for the poor people and have been working on issues relating to labourers and labour laws but this heart-wrenching incident shows a different picture.

The Commission has further observed that it is not understandable what is the benefit of announcement of number of schemes when they do not reach the beneficiaries. A poor girl has lost her life, the breadwinner of the family is suffering from tuberculosis and is bedridden. The family is not only financially poor but also belongs to the Scheduled Caste for which special schemes have been announced by the Central and the State governments.

This is a serious issue of violation of human rights due to gross negligence by the local administration. It is for the local public servants to honestly implement the schemes, so that the poor and needy can avail the benefits which , apparently was not done in this case. Had the authorities been sincere and vigilant, loss of a precious human life could have been averted. The State cannot escape its liability and there is a need to fix the responsibility of the public servants who have not acted in accordance with the law to help the aggrieved family.

Reportedly, the girl was living with her parents and sister at Nagla Vidhichand village in Agra’s Baroli Ahir block. The family was without any work for about a month and in recent weeks the family went without food. Many families in the localities like them do not have a ration card. The five-year-old girl Sonia had become weak and had fever for three days. She could not bear the pain and succumbed to illness and hunger on Friday night.

The local authorities reportedly did nothing to help the family-like securing food in the lockdown-induced crisis. The District Administration has said it will find out where things went wrong and they have taken cognizance of the matter and an investigation has been ordered into the child’s death. Further, the District Administration said that the family has buried the body, which they should not have done as a postmortem would have ascertained the cause of death.

Reportedly, the District Magistrate has agreed that the families are suffering and he will ensure that all possible help is provided to the family.


National Human Rights Commission

Press Release dt. 23-08-2020

COVID 19Legislation UpdatesNotifications

The Ministry of Home Affairs (MHA) has issued new guidelines today for opening up of more activities in areas outside the Containment Zones. In Unlock 4, which will come into effect from September 1, 2020, the process of phased re-opening of activities has been extended further. The new guidelines, issued today, are based on feedback received from States and UTs, and extensive consultations held with related Central Ministries and Departments.

Salient features of the new guidelines

  • Metro rail will be allowed to operate with effect from 7th September 2020 in a graded manner, by the Ministry of Housing and Urban Affairs (MOHUA)/ Ministry of Railways (MOR), in consultation with MHA. In this regard, Standard Operating Procedure (SOP) will be issued by MOHUA.
  • Social/ academic/ sports/ entertainment/ cultural/ religious/ political functions and other congregations will be permitted with a ceiling of 100 persons, with effect from 21st September 2020. However, such limited gatherings can be held with mandatory wearing of face masks, social distancing, provision for thermal scanning and hand wash or sanitizer.
  • Open air theatres will be permitted to open with effect from 21st September 2020.
  • After extensive consultation with States and UTs, it has been decided that Schools, colleges, educational and coaching institutions will continue to remain closed for students and regular class activity up to 30th September 2020. Online/distance learning shall continue to be permitted and shall be encouraged. However, following will be permitted, in areas outside the Containment Zones only, with effect from 21st September 2020 for which, SOP will be issued by the Ministry of Health & Family Welfare (MoHFW):
    1. States/ UTs may permit upto 50% of teaching and non-teaching staff to be called to the schools at a time for online teaching/ tele- counselling and related work.
    2. Students of classes 9 to 12 may be permitted to visit their schools, in areas outside the Containment Zones only, on voluntary basis, for taking guidance from their teachers. This will be subject to written consent of their parents/ guardians.
    3. Skill or Entrepreneurship training will be permitted in National Skill Training Institutes, Industrial Training Institutes (ITIs), Short term training centres registered with National Skill Development Corporation or State Skill Development Missions or other Ministries of Government of India or State Governments.

National Institute for Entrepreneurship and Small Business Development (NIESBUD), Indian Institute of Entrepreneurship (IIE) and their training providers will also be permitted.

  • Higher Education Institutions only for research scholars (Ph.D.) and post-graduate students of technical and professional programmes requiring laboratory/ experimental works. These will be permitted by the Department of Higher Education (DHE) in consultation with MHA, based on the assessment of the situation, and keeping in view incidence of COVID-19 in the States/ UTs.
  • All activities, except the following, shall be permitted outside containment zones:
  1. Cinema halls, swimming pools, entertainment parks, theatres (excluding open air theatre) and similar places.
  2. International air travel of passengers, except as permitted by MHA.
  • Lockdown shall continue to be implemented strictly in the Containment Zones till 30th September, 2020.
  • Containment Zones shall be demarcated by the District authorities at micro level after taking into consideration the guidelines of MoHFW with the objective of effectively breaking the chain of transmission. Strict containment measures will be enforced in these containment zones and only essential activities will be allowed.
  • Within the containment zones, strict perimeter control shall be maintained and only essential activities allowed.
  • These Containment Zones will be notified on the websites of the respective District Collectors and by the States/ UTs and information will also be shared with MOHFW.

States not to impose any local lockdown outside Containment Zones

State/ UT Governments shall not impose any local lockdown (State/ District/ sub-division/City/ village level), outside the containment zones, without prior consultation with the Central Government.

No restriction on Inter-State and intra-State movement

  • There shall be no restriction on inter-State and intra-State movement of persons and goods. No separate permission/ approval/ e-permit will be required for such movements.

National Directives for COVID-19 management

  • National Directives for COVID-19 management shall continue to be followed throughout the country, with a view to ensure social distancing.  Shops will need to maintain adequate physical distancing among customers. MHA will monitor the effective implementation of National Directives.

Protection for vulnerable persons

  • Vulnerable persons, i.e., 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 meeting essential requirements and for health purposes.

Use of Aarogya Setu

  • The use of Aarogya Setu mobile application will continue to be encouraged.

Click here to see MHA Guidelines

Click here to see D.O Letter

Read the guidelines here: UNLOCK-4 GUIDELINES


Ministry of Home Affairs

[Press Release dt. 29-08-2020]

COVID 19Hot Off The PressNews

The Centre has asked the States that there should be no restrictions imposed on the inter-State and intra-State movement of persons and goods and services during the present prevailing Unlock-3 guidelines.

In a communication to Chief Secretaries of all States, the Union Ministry of Home Affairs (MHA) has stated that it has been reported that local level restrictions on movement are being imposed by various districts/States.  Such restrictions are creating problems in the inter-State movement of goods and services and are impacting the supply chain, resulting in disruption of economic activities and employment, besides affecting the supply of goods and services.

The MHA has said such restrictions at the local level imposed by District Administrations or by States, amount to a violation of the guidelines issued by the MHA under the provisions of the Disaster Management Act, 2005.

Drawing attention to the MHA’s Order dated July 29, 2020, specifying Guidelines for Unlock-3, the communication reiterates that there shall be no restriction on inter-State and Intra-State movement of persons and goods. No separate permission/ approval/ e-permit will be required for such movements.

This includes the movement of persons and goods for cross land border trade under Treaties with neighbouring countries.


Ministry of Home Affairs

[Press Release dt. 22-08-2020]

[Source: PIB]

COVID 19Hot Off The PressNews

In view of the prevailing situation of the spread of coronavirus (2019-nCOV) pandemic in the NCT of Delhi, the Administrative and General Supervision Committee of the Delhi High Court extends the suspension of the functioning of the Court (except for the Court of Registrars/Joint Registrars) till 31-08-2020.

All the Benches of the Delhi High Court would continue to take up and hear all the urgent matters through videoconferencing.

The Courts of Registrars and Joint Registrars of this Court shall take up the matters through videoconferencing, where the files are already scanned. The evidence be recorded in ex-parte and uncontested matters where the same is required to be tendered by way of affidavit.

It has also been ordered that the Courts of Registrars and Joint Registrars of this Court shall not pass any adverse order in non-urgent/routine matters where the concerned advocate/litigant is unable to join the proceedings through video conferencing, till the time the physical functioning of the courts is resumed.

It has further been directed that subject to complete availability of public transport and subject to the situation in Delhi remaining stable, a plan be evolved for the gradual opening of physical courts from 1st September, 2020 onwards.

Read the detailed order here: High Court Lockdown upto 31.8.2020

PublicNotice_HU6IY8U125P


Delhi High Court

[Office Order dt. 15-08-2020]

Case BriefsCOVID 19District Court

District Court, Saket, Delhi: Raj Kumar Chauhan, J., directed “Miniso” to pay the rent arrears for the lockdown and post lockdown period stating that the company has no dearth of money as the company has been operating almost 10 similar premises on rent in Delhi successfully.

Lease

Allegations placed by the petitioners are that they had leased their property to respondent i.e. Miniso Life Style Private Limited.

Monthly Rent

Monthly rent of the leased out property was Rs 9,75,000/- plus GST per month and the same was to be paid in equal proportions to lessor 1, 2 and 3 as per the agreement signed between the parties.

Head of Business Development of Miniso i.e. respondent asked the petitioner to consider the waiver of rent for the time period of lockdown — April, 2020 to May, 2020.

Further, the petitioner informed the respondent that as per clause 12 of the agreement i.e. Force Majeure Clause was not applicable to the existing circumstances and respondent cannot take unjust and wrongful benefit of said clause.

Though the petitioners agreed to waive the penal interest on the delayed payment @18% p.a. but the respondent continued to threaten for creating third party interest in the demised premises.

Petitioners were represented by Counsels Gaganmeet Singh Sachdeva, Sumit Thakur and Counsel for the respondent was Akash Tyagi.

Legal Notice

Petitioners had to in view of the above circumstances send a legal notice for recovery of rent and arrears on 23-05-2020.

Later the respondent sent a proposal of paying 70% of the arrears of rent for the month of April and 90% of the rent for June and July, 2020.

Petitioners in good­faith and trust sent the invoices of the rent for the above stated months and requested the respondent to pay the payment after deducting 15% rebate for arrears of rent for April, May, alongwith rent of June and July.

Despite sharing the invoice the respondent did not clear the arrears of rent and stopped taking calls from the petitioners.

In view of the above circumstances, the present petition was filed.

Respondents contention was with regard to the maintainability of the petitions stating that Clause 12 of the Lease Deed provides eventualities wherein in case the demised Premises is, whether fully or partially, destroyed or damaged by any Act of God, such as by flood, earthquake, storm etc. save and except fire, becomes unfit for occupation or use, the rent payable by the respondent shall be suspended till such time as the Demised Premises is once again rendered fit for use and occupation by the respondent.

Counsel for the Petitioners relied upon the decision in, Sona Corporation India (P) Ltd. v. Ingram Micro India (P) Ltd., O.M.P (COMM.) 249/2018 and Ramanand v. Dr Girish Soni, R. C. Rev. No. 447 of 2017.

The above two cases were cited with respect to the contentions that Court under Section 9 of the Arbitration Act can direct the payment of rent due as well as future rent in the same manner as the Court can grant in a civil suit under Order 39 Rule 10 CPC.

Adding to the above, the latter case was relied upon to rebut the respondent’s claim for waiver of rent.

Decision

Bench on perusal of the referred provisions and sections of Arbitration Act and CPC held that the respondents are directed to pay admitted rent to the petitioner for the period which has not been paid for the leased premises alongwith future payment also be paid as per the lease deed.

Further, adding to its analysis of the facts, Court stated that on perusal of the force majeure clause in the agreement, it can be stated that the lessee is entitled to suspension of the rent only if the property has been damaged or destroyed by any force Majeure event.

Admittedly, the property in question has not been damaged/destroyed in force majeure event.

Hence, in view of the law laid down by Delhi High Court in the decision of Sona Corporation India (P) Ltd. v. Ingram Micro India (P) Ltd., O.M.P(COMM.) 249/2018 and Ramanand v. Dr Girish Soni, R. C. Rev. No. 447 of 2017, Court concluded its decision stating that,

“mere temporary non-use of the tenanted premises by the respondent and yet being in power and possession of the premises in view of the temporary lockdown due to the COVID-19 Pandemic, the said event cannot be covered under the force Majeure clause of the lease agreement.”

Therefore, the respondent cannot claim waiver of rent.

Hence the Court is empowered under Section 9 of the Arbitration Act to order payment of arrears of rent for the lockdown period and also post lockdown period.

In view of the above terms, petitions were disposed off. [Uma Sharma v. Miniso Life Style (P) Ltd., 2020 SCC OnLine Del 979, decided on 06-08-2020]