Case BriefsTribunals/Commissions/Regulatory Bodies

Income Tax Appellate Tribunal (ITAT), Mumbai: A two-Member Bench of Pramod Kumar (Vice President) and Ravish Sood (Judicial Member) allowed the Board of Control for Cricket in India (“BCCI”) to continue with its registration under Section 12-A of the Income Tax Act, 1961 making it eligible for income tax exemption benefits. The main controversy arose regarding the commercial nature of the Indian Premier League (“IPL”) organised by BCCI, however, there is significant discussion on substantive law in the decision of the Appellate Tribunal.

Factual Matrix

BBCI challenged correctness of the order passed by the Principal Commissioner of Income Tax, Mumbai (“CIT”), rejecting its application for registration under Section 12-A(1)(ab) read with Section 12-AA of the Income Tax Act, 1961.

Notably, BCCI was duly granted registration under Section 12-A in 1996, which is yet to be cancelled or withdrawn. However, BCCI applied for fresh registration in wake of the amendment in its ‘memorandum of association, and rules and regulations’, to implement the recommendations of Justice R.M. Lodha Committee.

While rejecting BCCI’s application, the CIT took note of the amended Memorandum of Association (“MoA”) and inter alia noted that a specific clause was inserted for conducting Indian Premier League (“IPL”) matches, and concluded that “it can be easily concluded that activities of the applicant specially in relation to the IPL are in the nature of trade, commerce or business, and therefore, the applicant is squarely covered by proviso to Section 2(15) and hence applicant’s claim of being covered by the last limb, i.e. advancement of any other object of general public utility cannot be held to be charitable purpose”.

BCCI on the other hand contented that its activities are wholly charitable and genuine, and the element of profit in organising the IPL event does not vitiate its predominant character.  It was submitted that BCCI was in fact under no obligation to approach the CIT for fresh registration as the amendments did not even remotely affect its basic objects for which the registration was earlier granted; nevertheless it approached the CIT in deference  to the observations made by another Bench of the Appellate Tribunal to the effect that “the assessee society should approach the registering authority with the changes and amendments so that the authorities could examine as to whether the amendments in question meet the requirement of law”.

Law, Analysis and Decision

Application of S. 12-A(1)(ab)

Referring first to Section 12-A(1)(ab), the Appellate Tribunal noted that the true trigger for an application under that section has to be the modification of objects “which do not conform to the conditions of the registration”. Therefore, unless such modifications are demonstrated, there is no occasion for CIT to assume jurisdiction. The registration granted to BCCI in 1996 was on the basis of MoA, 1940. Unless, therefore, there were significant amendments in that Memorandum of Association, the provisions of Section 12-A(1)(ab) will not come into play inasmuch these provisions come into play only when the assessee “has adopted or undertaken modifications of the objects which do not conform to the conditions of registration”.

The Appellate Tribunal then compared MoA, 1940 and the amended MoA, 2018, and found that the amended MoA does not show any change which is contrary to the corresponding clause in the earlier MoA. It was noted that there was nothing in the impugned order to even indicate that the modifications in the objects of the amended deed do not conform to the objects in the memorandum of association based on which the registration was granted. The Appellate Tribunal observed:

“It is also important to bear in mind the fact that Section 12-A(1)(ab) specifically refers to ‘objects’ of the assessee trust or institution, and, it cannot, therefore, be open to the Principal Commissioner to go beyond the ‘objects’ so far as jurisdiction under this Section 12-A(1)(ab) is concerned. It is only when there is such a modification in the object clause that it does not conform to the conditions of registration, i.e. objects clause in the documents based on which registration was granted – only the memorandum of association in this case, that Section 12-A(1)(ab) can come into play.”

It was also noted that any changes to bring out reforms in the functioning of BCCI and specifically approved by the Supreme Court to be for that purpose (by its order dated 9-8-2018), cannot be termed to be the changes that dilute the fundamental objective of promoting the game of cricket, or said to be “not in conformity” with the objects of promoting the game of cricket all along espoused by BCCI and as set out in the pre-amendment MoA. In this view of the matter also, the condition precedent for invoking Section 12-A(1)(ab), was not fulfilled.

Referring to the view of another Bench that the assessee society should approach the registering authority with the changes and amendments so that the authorities could examine as to whether the amendments in question meet the requirement of law, the Appellate Tribunal observed:

“[T]his requirement, in our humble understanding, does not necessarily extend to the filing of the fresh application of registration under Section 12-A(1)(ab) unless the amendments are such as not in conformity with the documents based on which registration was originally granted. There is a difference in these two situations, i.e. between keeping the registration authority [informed] about the changes in the memorandum of association etc., and between making an application for fresh registration which comes into play only when the amendments in question do not conform to the objectives in respect of which registration was granted or obtained. Unless that condition is satisfied, Section 12-A(1)(ab) [does not] come into play.”

It was observed that there is a vital distinction between “object” and “power”. It could not even be in dispute that the object of BCCI is the promotion of cricket game, and, at best, it has powers to hold IPL for achieving this object. Whether this power of conducting IPL is exercised with predominantly pecuniary gains in mind or not is a different aspect, but then this is a “power” not an “object”. The Appellate Tribunal was of the opinion that:

“So far as the provisions of Section 12-A(1)(ab) are concerned, the Principal Commissioner was only required to examine the objects of the institution and not to extend her considerations to the powers vested in the institution. Unless the bridge of finding variations in objects of pre-amendment or post-amendment objects is crossed, there is no occasion to examine anything else. “

Application of proviso to S. 2(15)

Next, it was noted that the entire basis of declining registration by CIT was invoking the proviso to Section 2(15) on the ground that IPL activities are in the nature of commercial activities and cross the threshold limit specified in exceptions to the proviso to Section 2(15). On this point, the Appellate Tribunal observed:

“It is, however, well-settled in law that so far as registration under section 12-AA is concerned, Section 2(15) has no application in the matter.”

Relying on its earlier decision in Kapurthala Improvement Trust v. CIT, 2015 SCC OnLine ITAT 8111, the Appellate Tribunal concluded that the remedy to the proviso to Section 2(15) coming into play is not denial of registration under section 12-A or 12-AA but denial of benefits of exemption under Section 11, under Section 13(8). That is the reason that along with the insertion of proviso to Section 2(15), effective from the same date, sub-section 13(8) was also inserted and these two provisions are thus clearly complementary in nature.

Indian Premier League

Interestingly, as to the question whether IPL can indeed be said to be commercial in nature in the sense that the entire orientation of these matches is aimed at making money in the garb of promotion of cricket, the Appellate Tribunal was of the view that it was not necessary to go into that aspect in the instant case. It however added:

“[O]n the face of it merely because a sports tournament is structured in such a manner so as to make it more popular, resulting in more paying sponsorships and greater mobilisation of resources, the basic character of the activity of popularising cricket is not lost. It is indeed possible that the predominant object remains the promotion of cricket but that activity is done in a more effective and financially optimal manner, and that there is no conflict in the cricket becoming more popular and the cricket becoming more entertaining. It results in providing significant economic opportunities to those associated with the holding of the IPL tournament and, in the process, enriching the resources of the assessee trust. As long as the object of promoting cricket remains intact, and that continues to be the predominant object, the assessee cannot be said to be not following the object of promoting cricket, just because the operational model of a cricket tournament, whether IPL or any other tournament, is more entertaining, more economically viable, provides greater economic opportunities to all those associated with that tournament, and mobilises greater financial resources for popularising cricket. The purpose for which all the funds at the disposal of the assessee trust, including the additional funds generated by holding the IPL tournament, are employed is certainly for promoting cricket, and that is what really matters. Improvising the rules of the game, adding entertainment value to it and making it economically attractive, may be a purist’s nightmare but the same factors can also be viewed as radical and innovative ideas to popularise a game –  the very raison d’être of an institution like this assessee, and that is how we view it.”

In such view of the matter, the Appellate Tribunal held that BCCI was entitled to continuance of its registration under Section 12-A dated 12-2-1996. Accordingly, the impugned order passed by the CIT was quashed. [BCCI v. CIT, ITA No. 3301/Mum/2019, dated 2-11-2021]

Case BriefsHigh Courts

Uttaranchal High Court: The Division Bench of Raghvendra Singh Chauhan, CJ. and Narayan Singh Dhanik, J. decided on a petition which was filed challenging the validity of the order passed by the Single Judge whereby the respondent-writ petitioner, M/s Kohli Enterprises, was not only blacklisted, but even its registration was cancelled by the appellants.

Counsel for the appellants, submitted that the impugned order passed by the Single Judge was a non-speaking order, as it does not spell out the three factors, which were required for grant of a stay order. Therefore, the impugned order passed deserved to be set aside by this Court.

Counsel for the respondent-writ petitioner, submitted that since the petitioner had challenged the jurisdiction of the Regional Manager to pass the impugned order dated 21-10-2021, and since no power of canceling a registration was granted either to the Regional Manager, or to the Managing Director, both the blacklisting, and the cancellation of the registration is patently illegal.

The Court after perusal of the impugned order noted that the Single Judge had merely observed that “having regard to the facts and circumstances of the case and also the reasons indicated in the impugned order, this Court is prima facie satisfied that petitioner has made out a case of grant of interim order”.

The Court found the reasoning given by the Single Judge cryptic as he neither discussed the existence of a prima facie case in favour of the respondent-writ petitioner, nor discussed the balance of convenience, nor discussed the irreparable loss that would be caused to the respondent-writ petitioner in case the stay were not granted by the Court.

The need for passing a reasoned order need not be emphasized. For, it is well known that a judicial order necessarily has to be a reasoned one, where the mind of the learned Court needs to be revealed, and cogent and convincing reasons need to be stated even while granting a stay order.

The Court set aside the impugned order and remanded the case back to Single Judge requesting to decide the Interim Stay Application within a period of two weeks.[Uttarakhand State Warehousing Corporation v. Kohli Enterprises, 2021 SCC OnLine Utt 1313, decided on 22-11-2021]


Suchita Shukla, Editorial Assistant has reported this brief.


Counsel for the appellants. : Mr D.S. Patni, Senior Counsel assisted by Mr Parikshit Saini

Counsel for the respondent. : Mr Anil Kumar Joshi

Case BriefsHigh Courts

Kerala High Court: P.B.Suresh Kumar, J., held that the requirement for Medical students who had studied abroad to undergo CRRI for obtaining permanent registration under State Medical Register was inconsistent with prevailing provisions.

Background

The petitioner, an Indian citizen enrolled for obtaining medical qualification without obtaining Eligibility Certificate insisted in terms of Section 13(4B) of the Indian Medical Council Act, 1956, which she obtained later on in 2017. She graduated in 2019, thereupon, she underwent one year internship in the various teaching hospitals under the Dubai Health Authority.

The petitioner cleared the Screening Test in terms of Section 13(4A) of the IMC Act in order to become eligible to be enrolled in a State Medical Register in India as well and applied for permanent registration under State Medical Register. Her application for registration was rejected by the State Medical Council, the Council insisted on requirement of Compulsory Rotatory Residential Internship (CRRI) in any one of the medical institutions approved by the Medical Council of India for foreign medical graduates before granting permanent registration to them in terms of Ext.P21 decision taken by the State Medical Council on 20-10-2017 in order to ensure that they learn and gain clinical experience and exposure about the epidemiological and clinical profile of local community.

Analysis and Findings of the Court

In the backdrop of above, the Court was to address following questions:

  1. Whether a person who has not undertaken internship as part of the medical course undertaken by him/her abroad is eligible to appear in the Screening Test provided for under Section 13(4A) of the IMC Act?

Regulation 11 of Screening Test Regulations, 2002 provides that candidates who qualify the Screening Test may apply to any State Medical Council for provisional or permanent registration and the State Medical Councils shall issue provisional registration to such candidates, who are yet to undergo one year internship in an approved institution and issue permanent registration to such eligible candidates who have already undergone one year internship. Therefore, internship is not insisted for appearing in the Screening Test and the only requirement for appearing in the Screening Test is that the candidates should possess a primary medical qualification.

Noticing that the State Medical Council did not have a case that the petitioner did not possess a primary medical qualification as defined in the Regulations at the time when she applied for and cleared the Screening Test, the Bench held that the stand of the State Medical Council that only students who had completed internship as part of the medical course undertaken by them in the medical institution abroad were entitled to appear for the Screening Test was unsustainable.

  1. Whether a person who obtains Eligibility Certificate after taking admission in a medical institution abroad, be denied enrolment on a State Medical Register, if he/she satisfies all other eligibility criteria for the same?

On the issue that the petitioner had obtained Eligibility Certificate only after taking admission in the medical institution abroad, the Bench observed that the Council had no case that the petitioner would not have been issued Eligibility Certificate, had she applied for the same before taking admission for the medical course in the medical institution abroad.

Section 13(4B) of the IMC Act itself provides that in case any person obtains any medical qualification without obtaining Eligibility Certificate, he shall not be eligible to appear for the Screening Test concerned. Noticing the fact that the petitioner was permitted by the competent authority i.e. Indian Medical Council to appear for Screening Test and the fact that she had cleared the Screening Test were not disputed by the State Medical Council,  the Bench remarked,

“True, the State Medical Council, while considering applications for registration, both provisional and permanent, has the power to verify whether the candidate has obtained Eligibility Certificate, but that does not mean that the State Medical Council is empowered to adjudicate the right of a person to obtain Eligibility Certificate and to appear for the Screening Test, ignoring the decisions taken by the Medical Council of India in this regard.”

Accordingly, the stand of the Council that the qualification obtained by the petitioner could not be regarded as one in accordance with the provisions of the IMC Act as she had not obtained Eligibility Certificate before taking admission, so as to become eligible to be enrolled as a medical practitioner in the State Medical Register was held to be unsustainable.

  1. Whether a person who obtains a medical qualification from a medical institution abroad and undertakes one year internship thereafter in the country of education and satisfies all other eligibility criteria for enrolment on a State Medical Register be insisted to undergo CRRI for the said purpose?

As per the IMC Act and Regulation 11 a person who obtains medical qualification granted by medical institutions outside India recognised for enrolment as medical practitioner in that country and who clears the Screening Test in terms of Section 13(4A) of the IMC Act, is entitled to be enrolled as a medical practitioner on any State Medical Register, if he has already undergone one year internship.

Since the fact that the petitioner had obtained a medical qualification granted by a medical institution in a country outside India recognised for enrolment as medical practitioner in that country and the fact that she had cleared the Screening Test were not in dispute, including the fact that the petitioner had completed one year internship after acquiring the primary medical qualification, the Bench held that the State Medical Council was obliged to grant permanent registration to the petitioner and they could not insist that the petitioner should undergo CRRI for the said purpose.

  1. Whether the State Medical Council is empowered to take decisions in the nature of Ext.P21?

Opining that a person who is entitled to registration in a State Medical Register in terms of the provisions of the IMC Act could not be denied registration by the State Medical Council, and the medical qualifications of foreign medical graduates who satisfy the requirements in the said provision are deemed to be recognised medical qualifications for the purpose of the IMC Act, the Bench was of the view that the requirement in terms of Ext.P21 that such medical graduates should undergo CRRI for claiming permanent registration was inconsistent with the requirement in terms of the IMC Act and also the Regulations.

“The IMC Act is one relatable to Entry 66 of List I of the Seventh Schedule to the Constitution and the TCMP Act is one relatable to Entries 25 and 26 of List III of the Seventh Schedule.   In other words, Ext.P21 decision of the State Medical Council being inconsistent with the provisions contained in the IMC Act, the same is invalid and unenforceable.”  

Conclusion

In the result, the writ petitions were disposed of directing the State Medical Council to permit the petitioner to apply for the permanent registration, and if applied, grant permanent registration to the petitioner without insisting her to undergo CRRI. [Sadhiya Siyad v. State of Kerala, 2021 SCC OnLine Ker 3954, decided on 20-10-2021]


Kamini Sharma, Editorial Assistant has reported this brief.


Appearance by:

Counsel for the Petitioner: Santhosh Mathew, Arun Thomas, Jennis Stephen, Vijay V. Paul, Karthika Maria, Veena Raveendran, Anil Sebastian Pulickel and Divya Sara George

Counsel for the State: Titus Mani and N.Raghuraj, SC, TCMC & KNMC

Case BriefsSupreme Court

Supreme Court: The Division Bench of K.M Joseph* and S. Ravindra Bhat, JJ., held that an unregistered family settlement document is admissible to be placed “in” evidence if it does not by itself affect the transaction though the same cannot be allowed “as” evidence. The Bench expressed,

“Merely admitting the Khararunama containing record of the alleged past transaction, is not to be understood as meaning that if those past transactions require registration, then, the mere admission, in evidence of the Khararunama and the receipt would produce any legal effect on the immovable properties in question.”

The Court was dealing with the impugned order of the Telangana High Court, whereby the High Court had set aside the order passed by the Trial Court by holding that the unregistered and unstamped family settlement “Khararunama” and receipt of Rs. 2,00,000 by the respondent were not admissible in evidence.

Factual Contours

The respondent, younger brother of the appellants had instituted a suit seeking declaration of title over the plaint schedule property and for eviction of the appellants and consequential perpetual injunction was also sought against the appellants. Evidently, there was a partition between the appellants, the respondent and their other siblings. Pursuant to some disputes between the parties a Khararunama dated 15-04-1986 was executed recording the facts.

It was contended by the respondent that the Khararunama required registration under section 17(1)(b) of the Registration Act, 1908 and under the said settlement, appellants ought to pay certain sum to the respondent. The document would come into force after the receipt of the consideration.

Statutory Requirements

Undoubtedly, Section 17(1)(b) makes ‘other non-testamentary instruments’, which purport or operate to create, assign, limit or extinguish whether in present or in future any right or interest whether vested or contingent of the value of Rs.100/- and upwards in an immovable property compulsorily registrable. Section 17(1)(c) reads as follows:

“17(1)(c) non-testamentary instruments which acknowledge the receipt or payment of any consideration on account of the creation, declaration, assignment, limitation or extinction of any such right, title or interest; and”

Section 49(c) of Registration Act prohibits the admitting of compulsorily registrable documents which are unregistered as evidence of any transaction affecting immovable property unless it has been registered.

Opinion and Analysis

Opining that unregistered document can be used as evidence of any collateral transaction, the Bench stated, however, the said collateral transaction should not itself be one which must be affected by a registered document. In K. Panchapagesa Ayyar v. K. Kalyanasundaram Ayyar, 1956 SCC OnLine Mad 141, the Madras High Court was of the view:

“To sum up it is well settled in a long series of decisions which have since received statutory recognition by the Amending Act of 1929 (vide the concluding words of the new proviso to Section 49 of the Registration Act) that a compulsorily registrable but an unregistered document is admissible in evidence for a collateral purpose that is to say, for any purpose other than that of creating, declaring, assigning, limiting or extinguishing a right to immovable property”.

Whether the Khararunama by itself affected rights in the immovable properties in question?

The next question before the Bench was whether the Khararunama by itself ‘affects’, i.e., by itself creates, declares, limits or extinguishes rights in the immovable properties in question or whether it merely refers to what the appellants alleged were past transactions which had been entered into by the parties, the Bench answered, going by the words used in the document, they indicate that the words were intended to refer to the arrangements allegedly which the parties made in the past and the document did not purport to by itself create, declare, assign, extinguish or limit right in properties.

Evidentiary Value of Khararunama

As per Section 49(1) (a), a compulsorily registrable document, which is not registered, cannot produce any effect on the rights in immovable property by way of creation, declaration, assignment, limiting or extinguishment. Thus, observing that Section 49(1) prevents an unregistered document being used ‘as’ evidence of the transaction, which affects immovable property, the Bench stated,

“If the Khararunama by itself, does not ‘affect’ immovable property, being a record of the alleged past transaction, though relating to immovable property, there would be no breach of Section 49(1)(c), as it is not being used as evidence of a transaction effecting such property.”

The Bench held that being let in evidence is different from being used as evidence of the transaction; thus, the transaction or the past transactions could not be proved by using the Khararunama as evidence of the transaction. In other words, the Bench held, “merely admitting the Khararunama containing record of the alleged past transaction, is not to be, understood as meaning that if those past transactions require registration, then, the mere admission, in evidence of the Khararunama and the receipt would produce any legal effect on the immovable properties in question.”

In Muruga Mudallar v. Subba Reddiar, 1950 SCC OnLine Mad 136, the Madras High Court had held that, “the consequence of non-registration is to prohibit the document from being received not “in” evidence, but “as” evidence of any transaction affecting such property.”

As far as stamp duty was concerned, the Bench was of the view that since the Khararunama was a mere record of past transaction it did not require to be stamped.

Verdict

Lastly, the Bench held, when there had been a partition, there may be no scope for invoking the concept of antecedent right as such, therefore since the appellants and the respondents had partitioned their joint family properties, the properties mentioned in the Khararunama would be separate properties of the respondent.

Resultantly, the Appeal was allowed. The impugned Judgment was set aside and the Khararunama was held to be admissible in evidence but not as evidence.

[Korukonda Chalapathi v. Korukonda Annapurna Sampath Kumar, 2021 SCC OnLine SC 847, decided on 01-10-2021]

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Kamini Sharma, Editorial Assistant has put this report together
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Appearance by:

For the Appellants: Advocate M. Vijay Bhaskar

For the Respondent: Advocate Venkateshwar Rao


*Judgment by: Justice K.M Joseph

Know Thy Judge| Justice K.M. Joseph

Legislation UpdatesRules & Regulations

The Government of Goa has notified the Goa Co-operative Societies (Amendment) Rules, 2021 on 23rd September 2021. The Goa Co-operative Societies (Amendment) Rules, 2021 permit the electronic means for sending application for registering a society.

 

Rule 4 of the Goa Co-operative Societies Rules, 2003, which deals with the application for registration, has been modified by the amendment to include that the application for registration shall be sent to the Registrar by registered post or delivery by hand or through electronic means.

 


*Tanvi Singh, Editorial Assistant has reported this brief.

Legislation UpdatesRules & Regulations

The Delhi Labour Department has notified the Delhi Shops and Establishments (Amendment) Rules, 2021 on September 24, 2021 to further amend the Delhi Shops and Establishments Rules, 1954.

The Rules make the following amendment under the Act:

 

  • Rule 3, substituted, deals with form for submitting statement and other particulars relating to name of the employer, the category of the establishment etc. The Rule provides that the occupier of the establishment, within 90 days of the commencement of work of his establishment shall apply for the registration under the Act, online on the Shop and Establishment Portal of Labour Department.
  • Rule 4, substituted, states that on submission of application online on the Shop & Establishment portal of Labour Department, Government of NCT of Delhi, the registration certificate shall be generated online in Form C.
  • Rule 6, substituted, the occupier shall notify any change in respect of any information under section 5(1) of the Act within 30 days after such change has taken place, online, on the Shop & Establishment Portal of Labour Department, Government of National Capital Territory of Delhi.

 


*Tanvi Singh, Editorial Assistant has reported this brief.

Legislation UpdatesStatutes/Bills/Ordinances

On September 17, 2021, the Rajasthan Assembly passed the Compulsory Registration of Marriages (Amendment) Bill, 2021 in order to amend the Rajasthan Compulsory Registration of Marriages Act, 2009.

Key Amendments:

  • Section 8 relating the duty to submit memorandum has been modified. It has been substituted with the following : 

(1) The parties to the marriage, or in case the  bridegroom has not completed the age of twenty one years and/or bride has not completed the age of eighteen years, the parents or, as the case may be, guardian of the parties shall be responsible to submit the memorandum, in such manner, as may be prescribed, within a period of thirty days from the date of solemnization of the marriage to the Registrar within whose jurisdiction the marriage is solemnized, or the parties to the marriage or either of them are residing for at least thirty days before the date of submission of the memorandum.
(1A) If, at any time, death of either of the parties  to the marriage or of both occurs, the surviving party, parents, adult child or, as the case may be, guardian of the parties may submit the memorandum, in such manner, as may be prescribed, to the Registrar within whose jurisdiction the marriage is solemnized, or the surviving party, parents, adult child or, as the case may be, guardian of the parties is residing for at least thirty days before the date of submission of the memorandum.

  • Section 2 clause (f) of the Rajasthan Compulsory Registration of Marriages Act, 2009  substituted with the following:

(f) “District Marriage Registration Officer, Additional District Marriage Registration Officer and Block Marriage Registration Officer” mean the District Marriage Registration Officer, Additional District Marriage Registration Officer and Block Marriage Registration Officer respectively appointed under section 5;

Legislation UpdatesRules & Regulations

The Ministry of Civil Aviation has passed the Drone Rules, 2021 vide gazette notification dated August 25, 2021. The Unmanned Aircraft System Rules, 2021 stand repealed.

 

Key highlights of the Rules are:

  • Application: The Rules shall apply to all persons – (a) owning or possessing, or engaged in leasing, operating, transferring or maintaining an unmanned aircraft system in India; (b) all unmanned aircraft systems that are registered in India; and (c) all unmanned aircraft systems that are being operated, in or over India. These rules shall not apply to an unmanned aircraft system belonging to, or used by, the naval, military or air forces of the Union of India. The Rules shall apply to an unmanned aircraft system with all-up-weight of less than 500 kg.
  • Certification: The Director General may issue a type certificate for any particular type of unmanned aircraft system. No security clearance is required before any registration or license issuance for drones. The requisite fees for permissions have also been reduced to nominal levels. Several approvals have been abolished, including the unique authorisation number, the unique prototype identification number, the certificate of conformance, the certificate of maintenance, the operator permits, the authorisation of the R&D organisation, and remote pilot instructor authorisation, among others.
  • Penalties: The Rules prescribe the maximum penalty for violating rules shall be ₹1 lakh.
  • Unmanned Aircraft Systems Promotion Council: An Unmanned Aircraft Systems Promotion Council is to be set up to facilitate a business-friendly regulatory regime.
  • Import: The import of drones will be regulated by the Directorate General of Foreign Trade (DGFT). Drone corridors will also be developed for cargo deliveries, the new rules dictate.
  • Airspace Map: Interactive airspace map with green, yellow, and red zones will be displayed on the digital sky platform. The yellow zone has been reduced from 45km to 12km from the airport perimeter. No permission is required for operating a drone in the green zone and up to 200 feet in the area between 8km-12km from the airport perimeter.
  • Zone Registration: Online registration of all zones shall occur through the Digital Sky platform, with an easy process prescribed for the transfer and deregistration of drones.
  • Drone School: The new drone policy aims to provide for the regularisation of the existing drones in India. All drone training and examination will be carried out by an authorised drone school. The DGCA shall prescribe training requirements, oversee drone schools, and provide pilot licenses online.
  • Safety and Compliances: Safety features like ‘No permission – no take-off (NPNT)’ real-time tracking beacon, geo-fencing, and the like shall be notified in the future, the policy notes. A minimum six-month lead time will be provided for compliance.

*Tanvi Singh, Editorial Assistant has reported this brief.

Legislation UpdatesStatutes/Bills/Ordinances

The Inland Vessels Act, 2021 was assented by the President on August 12, 2021. It replaces the Inland Vessels Act, 1917.  The Act regulates inland vessel navigation by states including the registration of vessels, and safe carriage of goods and passengers. The Act seeks to introduce a uniform regulatory framework for inland vessel navigation across the country promoting economical and safe transportation and trade through inland waters.

Key highlights of the Act are:

  • Mechanically propelled inland vessels: The Act defines such vessels any inland vessel in the inland waters which is propelled by mechanical means of propulsion such as ships, boats, sailing vessels, container vessels, and ferries.
  • Inland water area into zones: The State Government shall declare by notification any inland water area to be a “Zone” depending on the maximum significant wave eight criteria.
  • Registration: For operating in inland waters, all such vessels must have a certificate of survey, and a certificate of registration.  Vessels with Indian ownership must be registered with the Registrar of Inland Vessels (appointed by the state government).  The registration certificate will be valid across the country and will indicate the inland water zones (areas of operation to be demarcated by states) for such vessels.
  • Safety in navigation: Inland vessels shall be required to follow certain specifications for signals and equipment to ensure navigation safety, as specified by the central government.  In case of a navigation hazard, the master of a vessel must immediately send a distress signal to other vessels in proximity and to the concerned state government.
  • Accidents: Accidents in any case must be reported to the head officer of the nearest police station, as well as to a state government appointed authority.  The state may require the District Magistrate to question into these matters and submit a report recommending actions to be taken.
  • Contravention of provisions: The central government will prescribe the minimum number of people that vessels must have, for various roles. Contravention of any provisions will attract a penalty of up to Rs 10,000 for the first offence, and Rs 25,000 for subsequent offences. The central government will prescribe the standards for qualification, training, examination and grant of certificate of competency, which indicate the fitness of the recipients to serve in the specified roles.  State governments will grant these certificates.
  • Prevention of pollution: The central government will release a list of chemicals, any ingredients or substance carried as bunker or as cargo, or any substance in any form discharged from any mechanically propelled inland vessel, as pollutants. Vessels will discharge or dispose sewage, as per the standards specified by the central government. The State governments will grant vessels a certificate of prevention of pollution, in a form as prescribed by the central government.
  • Database on inland vessels: An electronic centralised record of data on inland vessels to be maintained by the central government. These will include information with respect to the(i) registration of vessels, (ii) crew and manning, and (iii) certificates issued.
  • Development fund: A Development Fund to be established under the Act for the following purposes: (i) emergency preparedness, (ii) containment of pollution, and (iii) boosting inland water navigation. Each state will constitute such a development fund. Sources of contribution to the fund include: (i) schemes of state governments, (ii) stakeholders, and (iii)collections from sale of wreck or cargo.
  • Non-mechanically propelled inland vessels: The Act delegates the power to State Government to make rules to regulate non-mechanically propelled inland vessels.

 


*Tanvi Singh, Editorial Assistant has reported this brief.

Case BriefsSupreme Court

Supreme Court: The bench of Ashok Bhushan* and R. Subhash Reddy, JJ has held that consent decree recognising pre-existing rights created by oral family settlement does not require registration under section 17 of  Registration Act, 1908.

Background

In the present case, Shri Sher Singh, husband of Jagno had half share in the agricultural land situate in village Garhi Bajidpur, which was suit property. Sher Singh died in 1953. Jagno after enforcement of the Hindu Succession Act, 1956 by virtue of Section 14 became the absolute owner of the half share of the suit property.

She had succeeded to half share in the agricultural land and she was the absolute owner when she entered into family settlement with her nephews i.e. sons of her brother.

On 19.08.1991, the trial court passed the consent decree in favour of the plaintiffs declaring the plaintiffs owners in possession of the half share in the land.

The descendants of brother of husband of Jagno filed a Civil Suit praying for declaration that the decree dated 19.08.1991 is illegal, invalid and without legal necessity. They also claimed decree of declaration in their favour declaring them owners in possession of land in question.

Analysis 

The Court took note of the judgment in Som Dev v. Rati Ram, (2006) 10 SCC 788 wherein decree was based on an admission recognising pre-existing rights under family arrangement. It was held that the decree did not require registration under Section 17(1)(b).

In in K. Raghunandan v. Ali Hussain Sabir, (2008) 13 SCC 102, the Court interpreted Section 17 and held,

“… a property which is not the subject-matter of the suit or a proceeding would come within the purview of exception contained in clause (vi) of sub-section (2) of Section 17 of the Act. If a compromise is entered into in respect of an immovable property, comprising other than that which was the subject-matter of the suit or the proceeding, the same would require registration.”

The recent judgment in in Mohammade Yusuf v. Rajkumar, (2020) 10 SCC 264 was also taken note of wherein it was held that if decree which was sought to be exhibited was with regard to the property which was subject matter of suit, hence, was not covered by exclusionary clause of Section 17(2) (vi) and decree did not require registration. (Justice Ashok Bhushan, the author of the present judgment had also penned the said judgment.)

Hence, in the present case, the Court held that in view of the fact that the consent decree dated 19.08.1991 relate to the subject matter of the suit, hence it was not required to be registered under Section 17(2) (vi) and was covered by exclusionary clause.

[Khushi Ram v. Nawal Singh, 2021 SCC OnLine SC 128, decided on 22.02.2021]


*Judgment by: Justice Ashok Bhushan 

Appearances before the Court by:

For appellant – Advocate Ranbir Singh Yadav

For respondent – Senior Advocate Manoj Swarup

ALSO READ 

Married woman’s heirs on paternal side are not strangers; she can enter in family settlement with such heirs: Supreme Court

Law School NewsLSAT India

To ensure fairness for students who have registered for the Central Board of Secondary Education (CBSE) Class XII examinations in May, the Law School Admission Council (LSAC) announced today that it will reschedule the 2021 LSAT—India, originally scheduled to begin 10 May 2021, to 14 June 2021. By allotting more time between tests, students will be able to adequately prepare for both examinations.

Due to the ongoing pandemic, the LSAT—India will be administered through an online test delivery system utilizing artificial intelligence-assisted remote proctoring to secure the integrity and validity of the test. The LSAT—India will be delivered over several days and time slots in the week starting 14 June 2021 in order to accommodate the large number of anticipated test takers. The deadline for registration has also been extended to 4 June 2021.

For students who wish to take the LSAT—India before the CBSE, LSAT—India will open an administration on 25 March 2021. Registration for that session opens from 3 Feb and close on 17 May 2021.

Aspirants who choose this option can take the test in March – well before the scheduled board exams – and use these scores for their law college application. An aspirant can also re-test in June and have their best score reported for their preferred college for admissions.

Students can register for the LSAT—India 2021 by visiting discoverlaw.in/register-for-the-test.

Students who register prior to 12 February 2021 will be eligible for the special early-bird price of INR 3499 per test for the March or June test administration. Students who register after 12 February 2021 will pay the standard price of INR 3799 for either administration. Students who register after 12 February but wish to sit for both tests, will be able to pay a discounted fee of INR 7300.

After the closure of registration period, candidates will receive scheduling details and instructions on how to take the online test to facilitate a seamless experience. LSAC will provide additional information about the online LSAT—India in the weeks ahead.

The LSAT—India is being used by many top law colleges in India as the entrance exam for securing admission to their law programmes. The LSAT—India allows students to take a single test to apply to many top law schools, making it a great choice for students who want to maximize their opportunities and save time, stress, and money.  The list of colleges accepting LSAT—India as one of their key admission criteria can be accessed HERE

Applicants can prepare for the exam using the material that is free to download from the Discover Law website (discoverlaw.in/prepare-for-the-test).

For more detailed information, please visit www.discoverlaw.in 

About LSAT—India

LSAT—India is a standardised test adopted as an admission criterion by multiple law colleges across India. It measures skills that are considered essential for success in law school. LSAT—India is specially created for admission to law schools in India by the Law School Admission Council, USA (LSAC). The LSAC has been helping law schools in various countries evaluate the critical thinking skills of their applicants for more than 70 years.

COVID 19Legislation UpdatesNotifications

In view of the unprecedented humanitarian and economic crisis, the CBDT has decided that the implementation of new procedure for approval/ registration/notification of certain entities shall be deferred to 1st October, 2020.

Accordingly, the entities approved/ registered/ notified under Sections 10(23C), 12AA, 35 and 80G of the Income-tax Act, 1961 (the Act) would be required to file intimation within three months from 1st October, 2020, i.e, by 31st December, 2020. Further, the amended procedure for approval/ registration/ notification of new entities shall also apply from 1st  October, 2020.

The necessary legislative amendments in this regard shall be proposed in due course.

Various representations were received in the finance ministry expressing concerns over the implementation of the new procedure from 1st June, 2020 due to the outbreak of novel corona virus (COVID-19) and consequent lockdown. There have been a number of requests to defer the applicability of the new procedure.

It may be noted that The Finance Act, 2020 rationalized the procedure relating to approval/ registration/ notification of certain entities referred to in sections 10(23C), 12AA, 35 and 80G of the Act, with effect from 1st June, 2020. As per the new procedure, the entities already approved/ registered/ notified under these sections would be required to file intimation within three months, i.e, by 31st August, 2020.

Further, the procedure for approval/ registration/ notification of new entities has also been rationalized with effect from 1st June, 2020.


Ministry of Finance

[Press Release dt. 09-05-2020]

[Source: PIB]

Hot Off The PressNews

It has been brought to the notice of the Food Safety and Standards Authority of India (FSSAI) that a number of websites are operating with the domain name comprising the word ‘FSSAI’ along with suffix or affix ‘registration’, ‘license’, etc. Some of such websites also use the logo of FSSAI.

FSSAI is a statutory body constituted under the Food Safety and Standards Authority of India Act, 2006. FSSAI has not authorized any entity to register its website with the domain name comprising the word ‘FSSAI’ or to use its name and logo or represent FSSAI as such. In the event anyone intends to avail the services of any such online website for registration/ license as food business operator, it is advisable that background check of such a third party should be carried out with regard to the authenticity or reliability of its services. FSSAI shall not be responsible for loss or damage suffered by the FBO on account of deficiency of services by such party.

Public is informed that applications for FSSAI license or registration by the Food Business Operators (FBOs) can only be made at the online Food Licensing and Registration portal of FSSAI by using the link https://foodlicensing.fssai.gov.in/index/aspx.


Food Safety and Standards Authority of India

[Press Release dt. 09-01-2020]

Hot Off The PressNews

Registration of political parties is governed by the provisions of Section 29A of the Representation of the People Act, 1951. An association seeking registration under the said Section has to submit an application to the Commission within a period of 30 days following the date of its formation, as per the guidelines prescribed by the Commission in exercise of the powers conferred by Article 324 of the Constitution of India and Section 29A of the Representation of the People Act, 1951.

In order to enable applicants to track the status of the application, the Commission has launched a “Political Parties Registration Tracking Management System (PPRTMS)”.

The salient feature in the PPRTMS is that the applicant, who is applying for party registration from 1-01-2020 will be able to track the progress of his/her application and will get the status update through SMS and e-mail.  The status can be tracked through the Commission’s portal at the link https://pprtms.eci.gov.in/. The Commission in the month of December, 2019,  has amended the guidelines and issued a Press Note dated 02.12.2019 regarding registration of political party for the information of the general public.  The new guidelines have been put to effect from 01-01-2020.


Election Commission

[Press Release dt. 01-01-2020]

[Source: PIB]

Case BriefsHigh Courts

Delhi High Court: Vibhu Bhakru, J. though conscious of the fact that the petitioners would face hardship, held that the petitioners who hold the degree of Medical Degree (Clinical) in General Internal Medicine from the University of Buckingham were not qualified to register and practice as specialists in India.

The batch of writ petitions was filed by doctors whose registration for the said degree under Section 26(1) of the Indian Medical Council Act, 1956 as additional qualification was entered in the Indian Medical Register. However, subsequently, the registration was cancelled by the Medical Council of India on the ground that the said degree was not recognised.

The High Court observed: “It is clear from the plain language of Section 26(1) of the IMC Act that only ‘a recognised medical qualification’ can be entered in the Indian Medical Register against the name of the medical practitioner. Clearly, a qualification which is not a recognised medical qualification cannot be entered in the Indian Medical Register.” In such circumstances, it was held that the decision of the MCI could not be faulted with.

Furthermore, petitioners’ contention that MCI was not estopped from revoking the registration already granted from denying the registration of an additional qualification was found unmerited. it was held that there is no estoppel against a statute and an error committed by MCI could not be allowed to be perpetrated.

Observing that the petitioners ought to have been aware that the said degree did not entitle a medical practitioner to practice as a specialist in that field in the UK and therefore, would not entitle them to practice as such in India, the High Court dismissed the writ petitions.[Ojasvi Sharma v. Union of India, 2019 SCC OnLine Del 9372, decided on 23-07-2019]

Cabinet DecisionsLegislation Updates

The Union Cabinet chaired by Prime Minister Narendra Modi has approved the introduction of Registration of Marriage of Non-Resident Indian (NRI) Bill, 2019, for creating more accountability and offering more protection against exploitation of Indian citizens, mostly women by their NRI spouses.

Details:

The Bill provides for amendment of the legal framework to act as a deterrent to the erring NRI spouses and creating more accountability and offer protection against exploitation of Indian Citizens married to NRIs.

Once the Bill is passed, marriages performed by NRIs would be registered in India or Indian Missions & Posts abroad, and necessary changes would be carried out in the:

  1. Passports Act, 1967; and
  2. Code of Criminal Procedure 1973 by insertion of Section 86A.

Major Impact:

Serving Judicial summons for Court proceedings in India is a major problem, which would be taken care of by this Bill by amending the Code of Criminal Procedure, 1973. Thus, the Bill would offer great protection to Indian citizens married to NRIs and serve as a deterrent to NRIs against harassment of their spouses. This Bill would benefit Indian women married to NRIs worldwide.

[Source: PIB]

Cabinet

Case BriefsHigh Courts

Delhi High Court: A Single Judge Bench comprising of Vibhu Bhakru, J., dismissed a writ petition filed by a doctor against the decision of Delhi Medical Council denying him a renewal of registration.

The petitioner practiced medicine for the last 30 years in India and outside. From 2004 to 2011, he was practicing in State of Georgia, USA. Thereafter, he moved to India and had been practicing in Delhi. He was registered with Delhi Medical Council. In May 2017, a news article appeared in The Indian Express alleging that the petitioner had been charged and indicted on various counts of sexual misconduct in State of Georgia. Delhi Medical Council declined to renew his registration for concealing the fact of his having been guilty in a court of law. Before the Superior Court of Fulton County, he pleaded guilty for sexual battery and unwarranted medical examination on women patients. He struck a plea bargain and his 12-month sentence was suspended on special conditions which inter alia included that he would not practice medicine in any form within the USA or in any other country. Taking note of the same, renewal of registration was denied and disciplinary proceedings were also commenced by Medical Council of India. Aggrieved by the same same, the petitioner filed the instant petition.

The High Court noted that the declaration made by the petitioner before Delhi Medical Council was false in as much as he concealed the fact of being subject to an inquiry in the State of Georgia. Reference was made to Regulations 7.4 and 7.5 of Medical Council (Professional Conduct, Etiquette, and Ethics) Regulations, 2002. In the facts of the case, the Court was convinced that the petitioner was guilty of acts of sexual misconduct and was convicted for an offence involving moral turpitude. Medical Council of India had erased his name from the Medical Register which was found justified. Therefore, the Court found no reason to interfere with the impugned order. Hence, the petition was dismissed. [N.K. Gupta v. Medical Council of India,2018 SCC OnLine Del 10132, dated 23-07-2018]

Case BriefsHigh Courts

Uttaranchal High Court: The Division Bench of V.K. Bist and Alok Singh, JJ. has ordered in a Public Interest Litigation to shift all stray dogs with the State to shelter houses within six months.

The question before the Court was whether the life of a citizen is important than the stray dogs and whether the State authorities are duty bound/responsible for protecting/saving the life of the public of the State from the dog biting of stray dogs. Petitioner submitted that during last five years, more than eleven thousand cases of dog biting have come into light in which several persons have died also.

Though counsel for the State submitted that the work in this regard is to be done by the respective municipal bodies but considering the importance of the matter, the Court directed the Chief Secretary of the State to issue necessary directions to all concerned for taking appropriate steps in this regard. It was also made clear that the direction issued by the Chief Secretary of the State will be binding on all the authorities and non-compliance of the same would be treated as contempt of Court.

First of all, the authority concerned will have to determine the number of stray dogs in every town, city, and village. Necessary arrangements will have to be made for the construction of shelter house in every place. Court also suggested that the State Government may consider for making a law regarding the killing of dangerous stray dogs. The municipal and local authorities will also have to verify from each and every house whether their dogs are registered with the municipal board and if they found that the dogs are not registered they would ensure the registration as per law. [Girish Chandra Kholia v. State Of Uttarakhand,2018 SCC OnLine Utt 556, order dated 14-06-2018]

Business NewsNews

With an objective to familiarise the eligible and desirous individuals and entities with the process of registration as a valuer with the Insolvency and Bankruptcy Board (IBBI) , the IBBI today released the process required. The process of registration as registered valuer with the IBBI is as under:

A. For Individuals

Step 1: Satisfy yourself that you meet the eligibility requirements prescribed in Rule 3 and qualification and experience prescribed in Rule 4 of the Rules.

Step 2: Thereafter, seek enrolment as a valuer member of a RVO recognized by the IBBI.

Step 3: As a member of a RVO, complete the educational course recognised by the IBBI.

Step 4: Register and pass the computer based Valuation Examination of the relevant Asset Class conducted by the IBBI. Details of the Valuation Examination are available at IBBI website (www.ibbi.gov.in).

Step 5Within three years of passing the valuation examination, submit Form A appended to the Rules, duly filled in along with a payment of Rs. 5900 (Fee of Rs.5000 + 18% GST) in favour of the Insolvency and Bankruptcy Board of India and supporting documents, to your RVO. Quote GST number, if required by you. The Form A is to be submitted, documents to be uploaded and payment is to be made online. Please visit the IBBI web site www.ibbi.gov.in for this purpose.

Step 6: Thereafter, RVO shall verify Form A and other requirements and then submit the Form A along with its recommendation for registration as a valuer to the IBBI. The Form is to be submitted by the RVO online.

Step 7: On receipt of Form A along with recommendation of the RVO, the fee and other documents, the IBBI shall process the application for registration in accordance with the Rules.

B. For Entities (Partnership Firms, LLP and Companies)

Step 1: Satisfy yourself that you meet the eligibility requirements prescribed in rule 3 and qualification and experience prescribed in Rule 4 of the Rules.

Step 2: Submit Form B appended to the Rules, duly filled in along with a payment of Rs.11,800 (Fee of Rs.10,000 + 18% GST) in favour of the Insolvency and Bankruptcy Board of India and supporting documents, to your RVO. Quote GST number, if required by you. The Form B is to be submitted, documents to be uploaded and payment is to be made online. Please visit the IBBI web site www.ibbi.gov.in for this purpose.

Step 3: Thereafter, RVO shall verify Form B and other requirements and then submit the Form B along with its recommendation for registration as a valuer to the IBBI. The Form is to be submitted by the RVO online.

Step 4: On receipt of Form B along with recommendation of the RVO, the fee and other documents, the IBBI shall process the application for registration in accordance with the Rules.

BACKGROUND

Earlier, the Central Government had notified the commencement of Section 247 (relating to valuers) of the Companies Act, 2013 with effect from 18th October, 2017 and also notified the Companies (Registered Valuers and Valuation) Rules, 2017 (hereafter, “Rules”) on the same day. Vide notification dated 23rd October, 2017, the Central Government issued the Companies (Removal of Difficulties) Second Order, 2017 to provide that valuations required under the Companies Act, 2013 shall be undertaken by a person who, having the necessary qualifications and experience, and being a valuer member of a recognised valuer organisation (RVO), is registered as a valuer with the Authority. Vide another notification on the same date, the Central Government delegated its powers and functions under Section 247 of the Companies Act, 2013 to the Insolvency and Bankruptcy Board of India (IBBI) and specified the IBBI as the Authority under the Rules.

Subject to meeting other requirements, an individual is eligible to be a registered valuer, if he (i) is a fit and proper person, (ii) has the necessary qualification and experience, (iii) is a valuer member of a RVO, (iv) has completed a recognised educational course as member of a RVO, and (v) has passed the valuation examination conducted by the IBBI, and (vi) is recommended by the RVO for registration as a valuer. A partnership entity or a company is also eligible for registration subject to meeting the requirements.

Ministry of Corporate Affairs

Business NewsNews

In order to encourage farmers to register more crop varieties, the Union Ministry for Agriculture and Farmers’ Welfare has announced cash incentives to farmers. An office of PPV and FRA would be opened to cater to the needs of the farmers in the State. The more crop varieties registered under the Protection of Plant Varieties and Farmers’ Rights Authority (PPV and FRA), the more cash incentives for farmers. About Rs 10 lakh will be given to the community for propagating the awareness on farmers rights in a particular area, while a cash incentive of Rs 1.5 lakh will be given to individual farmers for clocking higher registrations of varieties which they have developed in their fields.

[Source: The Hindu BusinessLine]