Read Order: State of Himachal Pradesh v. Raghubir Singh & Ors [SC- CRIMINAL APPEAL NO. 2567 OF 2024]
Tulip Kanth
New Delhi, May 20, 2024: While upholding the conviction in a 35-year-old rape case, the Supreme Court has dismissed the appeal preferred by the State of Himachal Pradesh seeking enhancement of the sentence. The Top Court also took note of the doctor’s opinion that it is not necessary that in a case of forcible sexual intercourse, an injury should be there on the body of the victim.
The alleged incident is of July 8, 1989. The prosecutrix (PW-5) stated that on the afternoon of the date of the incident, she had visited a video parlour in Manali, where she watched a movie. Accused Vijay was sitting next to her. She stated that the accused Vijay suggested her to go to a particular place for taking bath. She declined to do so. Accused Vijay told her that he was interested in getting married to her. Both came out of the video parlour, and she was taken to a bridge in Manali, where she was made to wait.
A Gypsy vehicle was brought, driven by accused Ravi and one Munna (absconding accused). The prosecutrix was told to sit in the vehicle and was taken to Solang Nullah. She alleged that at that place, accused Vijay had forcible sexual intercourse with her.Thereafter, Sunil, Nanu (absconding accused), and Munna (absconding accused) committed forcible sexual intercourse with her. After that, accused Sunil threatened the prosecutrix and told her to keep mum. When the prosecutrix approached the accused Raghu, accused Hari and Chunni Pradhan she was told to go home. She stated that she was lifted and put in the Gypsy vehicle. Thereafter, these 3 accused allegedly committed sexual intercourse against her wish. She was left on the road, and the accused fled by the gypsy vehicle. The prosecutrix took a lift and reached her home.
Initially, the accused were prosecuted for the offences punishable under Section 376, read with Section 34 of the IPC. Six accused were tried before the Sessions Court, namely, Raghubir Singh (Raghubir), Vijay Kumar (Vijay), Ravi Prakash (Ravi), Anil Kumar alias Bittu (Anil), Hari Ram (Hari) and Sunil Kumar (Sunil). The Trial Court acquitted the accused on the ground that in the absence of any corroborating evidence of any struggle on the part of the prosecutrix or any corroborating injury on the person of the accused, the defence of the accused that the sexual intercourse was with the consent, couldn’t be ruled out.
The State of Himachal Pradesh approached the Top Court being aggrieved by that part of the impugned judgment, by which the accused were let off on the sentence of imprisonment for three years which is less than the minimum sentence of ten years as provided under Section 376(2), which was applicable on the date on which the alleged act of offence was committed. The accused Vijay had also filed an appeal challenging his conviction.
Going through the judgment of the Sessions Court, the Bench noticed that three out of five accused had come out with a case that they had sexual intercourse with the consent of the prosecutrix. They went to the extent of alleging that they used to pay her consideration.
The Court referred to Sub-section (4) of Section 313 of the Cr.PC which provides that the answers given by the accused in his examination under sub-section (1) of Section 313 of the Cr.PC may be taken into consideration in the trial. Reference was also made to the judgment in Manu Sao v. State of Bihar [LQ/SC/2010/709]
The Bench asserted, “...the conviction cannot be based solely on the statements made by an accused under sub-section (1) of Section 313 of the Cr. PC. The statements of the accused cannot be considered in isolation but in conjunction with the evidence adduced by the prosecution. The statements may have more relevance when under a statute, an accused has burden of discharge. When the law requires an accused to discharge the burden, the accused can always do so by a preponderance of probability. But, while considering whether the accused has discharged the burden, the court can certainly consider his statement recorded under Section 313.”
In this case, the accused had no burden to discharge. In the present case, while appreciating the evidence adduced by the prosecution, the statements of the three accused that they maintained a physical relationship with the prosecutrix by paying her money was to be considered. The doctor, who had examined the victim, noted inflammation in the private parts of the victim. In the cross-examination, the doctor opined that it was not necessary that in a case of forcible sexual intercourse, an injury should be there on the body of the victim. “Absence of injuries on the person of the prosecutrix is by itself no ground to infer consent on the part of the prosecutrix”, the Bench said.
The High Court had given a finding that the age of the prosecutrix was not less than sixteen years. Both Sections 375 and 376 of the IPC were subsequently substituted by Act No.13 of 2013, effective from February 3, 2013. Therefore, in the present case, Sections 375 and 376 of the IPC was to be made applicable as substituted with effect from December 25, 1983. Considering sixthly in Section 375, at the relevant time, sexual intercourse with a woman who was not less than sixteen years with consent did not constitute an offence of rape.
It was noticed by the Bench that there was no suggestion given by the accused that the sexual intercourse with the prosecutrix was with her consent. The evidence of the prosecutrix in her examination-in-chief that the accused committed sexual intercourse with her had not been shaken. The case of accused that he was in a relationship with the victim for one year and was paying money to the victim for maintaining a sexual relationship, had not been put to the prosecutrix. It was observed that the manner in which the prosecutrix was taken initially near the Nullah and after that to another place established the case of the prosecutrix of forcible sexual intercourse.
As per the Bench, the High Court’s conclusion was the only possible conclusion based on the evidence on record and there was no merit in the appeal preferred by the accused Vijay. The Bench opined that, at the relevant time, the Court had the power, for adequate reasons mentioned in the judgment, to impose a sentence of imprisonment of either description for a term of less than ten years.
The Top Court was of the view that the Judges of the High Court noticed that they were dealing with an incident that had taken place twenty-eight years back, and, in the meantime, the accused and their families had moved ahead in life. Therefore, the High Court was of the view that there were adequate reasons which warranted the exercise of powers under the proviso. In the facts of the case, enhancement in sentence was not justified nearly 35 years after the incident.
Thus, finding no merit in the appeal filed by the State and dismissing the same, the Bench granted one month time to the accused Vijay to surrender before the Trial Court to undergo the remaining sentence in terms of the impugned judgment of the High Court.
Read Order: RAJENDRA S/O RAMDAS KOLHE v. STATE OF MAHARASHTRA [SC- CRIMINAL APPEAL NO. 2281 OF 2011]
Tulip Kanth
New Delhi, May 17, 2024: In a case where a woman was burnt alive by her husband who was serving in the army and her brother-in-law, the Supreme Court has asked the husband to surrender within 2 weeks as he is on bail since the year 2016. The Top Court based the conviction on the dying declaration of the deceased after finding no grounds to doubt its correctness.
The prosecution case in brief was that the wife of the appellant Rekha was a police constable and lived in the police colony. Her husband i.e. the appellant who was serving in the army had come home on leave.
The incident is of the year 2002 when Rekha sustained burn injuries in the quarter where she was residing. According to the prosecution, she was subjected to cruelty by her husband Rajendra and brother-in-law Suresh. She was also subjected to sustained cruelty at the hands of her other in-laws. On the fateful day, Rekha was beaten by her husband and brother-in-law. They tied her hands and feet, gagged her face, poured the kerosene on her person and lit the matchstick. In the process, she got completely burnt. She was taken to the hospital by the neighbours where her dying declaration was recorded on the basis of which FIR was registered under Sections 307, 498A, 342, 323 and 504 read with Section 34 IPC.
The appeal before the Top Court was directed against the judgment of the Bombay High Court dismissing Criminal Appeal thereby confirming the order of the Trial Court convicting the appellant for committing an offence punishable under Section 302 read with Section 34 of the Indian Penal Code, 1860 (IPC) and sentenced to suffer life imprisonment and to pay a fine of Rs. 25,000. However, in the year 2016, the Top Court noted that appellant had already undergone about nine years of sentence. Therefore, the sentence was suspended and bail was granted to the appellant.
The Division Bench of Justice Abhay S. Oka & Justice Ujjal Bhuyan opined that Rekha’s dying declaration clearly stated about the role played by the husband (appellant) and the brother-in-law in the incident which led to her burn injuries. The contents of the dying declaration had been proved. The incident had occurred on 22.07.2002 with the dying declaration recorded on the same day within a couple of hours whereas the evidence was tendered in court by the witnesses after 5 years. So inconsistencies were bound to be there. Identical statements by the material witnesses may create doubt in the mind of the court about the credibility of such evidence, as being tutored. That being the position, the Bench was inclined to accept the dying declaration of the deceased as a valid piece of evidence.
Expounding on the law relating to dying declaration, the Bench said, “Once a dying declaration is found to be authentic inspiring confidence of the court, then the same can be relied upon and can be the sole basis for conviction without any corroboration. However, before accepting such a dying declaration, court must be satisfied that it was rendered voluntarily, it is consistent and credible and that it is devoid of any tutoring. Once such a conclusion is reached, a great deal of sanctity is attached to a dying declaration and as said earlier, it can form the sole basis for conviction.”
Reference was also made to Section 32 of the Evidence Act, 1872 which says that statements made by a person who is dead or who cannot be found etc., be it in written form or oral, are themselves relevant facts. As per the first situation, when the relevant facts relate to the cause of death, such a statement would be relevant whether the person who made it was or was not at the time of making the statement under expectation of death. Such a statement would be relevant whatever may be the nature of the proceedings in which the cause of his death comes into question. The relevancy is not confined to the cause of his death but also to the circumstances of the transaction which resulted in his death.
Reliance was also placed uponthe judgments in Sher Singh vs. State of Punjab [LQ/SC/2008/372]; Sudhakar vs. State of Madhya Pradesh [LQ/SC/2012/601] and Amol Singh vs. State of Madhya Pradesh [LQ/SC/2008/1239].
The Bench found no reason to doubt the correctness of the dying declaration of the deceased which had been proved in evidence. Attending doctor had certified that the deceased was capable of narrating her statement. The substance of the dying declaration was also borne out by the medical history of the patient recorded by the doctor which has also been proved in evidence. Though there were inconsistencies and improvements in the version of the prosecution witnesses, there was however convergence with the core of the narration of the deceased made in the dying declaration and the medical history recorded by the doctor. That being the position, the evidence on record, clearly established the guilt of the appellant beyond all reasonable doubt.
Noting that the appellant is on bail since the year 2016, the Bench dismissed the appeal and directed the appellant to surrender before the trial court within two weeks to carry out his sentence.
Read Order: S. NITHEEN & ORS v. STATE OF KERALA & ANR [SC- CRIMINAL APPEAL NO(S). 2585 OF 2024]
LE Correspondent
New Delhi, May 17, 2024: The Supreme Court has clarified that in order to bring home the charge u/s 494 IPC, the complainant would be required to prima facie prove not only the presence of the accused persons, but the overt act or omission of the accused persons in the second marriage ceremony and also establish that such accused were aware about the subsisting marriage.
The complainant- Reynar Lopez(respondent No.2) married Lumina(A-1) as per the Christian ceremonies in a church in Kerala on April 16, 2007. It was alleged that on August 13, 2010, Lumina(A-1) contracted marriage with Saneesh(A-2) under the Special Marriage Act, 1954. The appellants herein(A- 3, A-4, A-5, A-6 and A-7) are relatives and friends of Saneesh(A-2) and Lumina(A-1) and thus they too are responsible for the offence of bigamy committed by Lumina(A-1) as they had the common intention to commit such offence.
The appeals before the Top Court preferred on behalf of the appellants challenged the final judgment of the Kerala High Court whereby, the petition preferred by the appellants seeking quashing of the proceedings for the offences punishable under Section 494 read with Section 34 of the Indian Penal Code, 1860 was rejected.
Referring to the judgment in Gopal Lal v. State of Rajasthan [LQ/SC/1979/75], the Bench explained that the essential ingredients of offence under Section 494 IPC arethat the accused spouse must have contracted the first marriage, while the first marriage was subsisting the spouse concerned must have contracted a second marriage, and both the marriages must have been valid in the sense that the necessary ceremonies required by the personal law governing the parties had been duly performed.
It was opined that the order framing charge is erroneous on the face of the record because no person other than the spouse to the second marriage could have been charged for the offence punishable under Section 494 IPC simplicitor. However, the Bench held that this is a curable defect, and the charge can be altered at any stage as per the provisions of Section 216 CrPC.
The present case was a peculiar case as the complainant has not sought prosecution of the appellants for the charge of abetting the second marriage by Lumina(A-1) under Section 109 IPC. The appellants were being roped in by virtue of Section 34 IPC with the allegation that they had the common intention to commit the offence under Section 494 IPC.
“In order to bring home the said charge, the complainant would be required to prima facie prove not only the presence of the accused persons, but the overt act or omission of the accused persons in the second marriage ceremony and also establish that such accused were aware about the subsisting marriage of Lumina(A-1) with the complainant”, it added.
One Flory Lopez(A-3) and Vimal Jacob(A- 4) were not even alleged to be present at the time of such marriage. Hence, the involvement of these accused for the charge of having a common intention to commit the offence under Section 494 IPC was not established by an iota of evidence.
So far as S. Nitheen(A-5), P.R. Sreejith(A-6) and H. Gireesh(A- 7) were concerned, they were alleged to be the friends of Lumina(A-1) and Saneesh(A-2) and they witnessed the alleged bigamous marriage.
The complainant who testified as CW-1 had alleged in his deposition that accused S. Nitheen(A-5), P.R. Sreejith(A-6) and H. Gireesh(A-7) were the witnesses to the second marriage. However, there was not even a shred of allegation by the complainant that these accused acted as witnesses to the second marriage having knowledge that Lumina(A-1) was already married to the complainant.
“In absence of such allegation, the prosecution of the S. Nitheen(A-5), P.R. Sreejith(A-6) and H. Gireesh(A-7), for the charge of having a common intention to commit the offence under Section 494 IPC is totally unwarranted in the eyes of law”, the Bench held.
Placing reliance upon Chand Dhawan(Smt) v. Jawahar Lal and Others [LQ/SC/1992/359] where the Top Court had upheld the order passed by the High Court quashing the criminal proceedings under Section 494 IPC against the accused therein, the Bench held that the order framing charge as well as the order rejecting the revision petition and criminal miscellaneous petition preferred by the accused appellants do not stand to scrutiny.
Allowing the appeals, the Bench quashed all the subsequent proceedings sought to be taken against the appellants. However, the trial of Lumina(A- 1) and Saneesh(A-2) has been ordered to be continued.
Read Order: C. SUBBIAH @ KADAMBUR JAYARAJ AND OTHERS v. THE SUPERINTENDENT OF POLICE AND OTHERS [ SC- CRIMINAL APPEAL NO(S). 2582 OF 2024]
Tulip Kanth
New Delhi, May 17, 2024: In a criminal proceeding involving benami land deals instituted at the instance of a Government teacher, the Supreme Court has set aside a Madras High Court order dismissing the application preferred by the appellants seeking quashing of proceedings under Sections 420, 120B,294(b), 506(ii) of the IPC. The Top Court opined that a dispute which is purely civil in nature has been given a colour of criminal prosecution alleging fraud and criminal breach of trust by misusing the tool of criminal law.
The complainant, before being appointed as a Government teacher, was doing real estate business for earning his livelihood for the past 16 years.He claimed that taking undue advantage of the trusting nature of the complainant, the accused persons induced him to join their real estate business claiming that they had strong political connections. The complainant was not allowed to get the purchased properties registered in his name despite making the investments. He was given assurances that the plots bought under the names of different persons would be sold for huge profit in a very short duration and he would be given his share.
The complainant invested a sum of Rs. 1,01,47,800/- towards this transaction whereas, the accused invested proportionately much lesser amounts in the said land deal. A-1, A-3, A-4, and A-6 along with the complainant, purchased the said parcel of land from A. Sairam for a total consideration of Rs. 3,08,33,600/-. However, as per the complainant, the accused never gave him the plots equivalent to the investment made by him and thereby, committed fraud and breach of trust.
When the complainant was not given his share of properties, a Panchayat meeting was held whereby it was agreed that 52 plots admeasuring 256.51 cents would be handed over by A-1 and A-2 to the complainant towards the investment made by him.However, the accused committed breach of trust By not giving the complainant his share. The sale deeds were also not executed in favour of persons who were nominated by the complainant. It was further alleged that A-1 further induced the complainant to pay a sum of Rs. 41,00,000 in 2011 hereafter, the sale deed for one of the properties forming a part of the settlement memorandum was executed. The accused hadalso fraudulently transferred some lands in favour of unknown investors. Being aggrieved of these continued criminal activities of the accused, the complainant submitted a complaint at the Kovilpatti West Police Station.
The appeal by special leave before the Top Court was filed challenging the judgment of the Single Judge of the Madras High Court dismissing the application preferred by the appellants herein seeking quashing of proceedings of pending in the Court of Judicial Magistrate for offences punishable under Sections 420 read with Section 120B, Section 294(b), Section 506(ii) read with Section 114 of the Indian Penal Code, 1860( IPC).
Considering the fact that the complainant is a Public servant, the Division Bench of Justice B.R. Gavai & Justice Sandeep Mehta had put up a query to the Counsel regarding the applicability of Section 13(1)(b) and Section 13(2) of the Prevention of Corruption Act, 1988. It was submitted that
whatever money the complainant invested in the disputed land deals entered into with the accused, were genuine investments made by using his valid and declared sources of income and savings. Being satisfied with the explanation, the Bench didnot find any justifiable cause so as to direct an enquiry against the complainant for the offences under the PC Act.
It was noticed that the property deals allegedly made in the names of other persons by using the funds partially provided by the complainant were benami transactions. Referring to the Benami Transactions (Prohibition), Act 1988, the Bench opined that by virtue of the provisions contained in Sections 4(1) and 4(2) of the Benami Act, the complainant is prohibited from suing the accused for a civil wrong, in relation to these benami transactions, as a corollary, allowing criminal prosecution of the accused in relation to the self-same cause of action would be impermissible in law.
“It is, thus, clear that the complainant in spite of having made investments in the land deals which were evidently benami transactions, could not have instituted any civil proceedings for recovery against the person(s) in whose name, the properties were held which would be the accused appellants herein”, the Bench said.
The Bench deciphered from the complaint that there was no such allegation therein which could persuade the Court to hold that the intention of the accused appellants was to defraud the complainant right from the inception of the transactions.
Noting that the allegations can give a cause to the complainant to sue the accused appellants in a civil Court but such remedy is barred by Section 4 of the Benami Act, the Bench said, “Thus, we are of the firm view that the necessary ingredients of the offences punishable under Section 406 and Section 420 IPC are not made out against the accused appellants from the admitted allegations set out in the complaint and the charge sheet. It cannot be doubted that a dispute which is purely civil in nature has been given a colour of criminal prosecution alleging fraud and criminal breach of trust by misusing the tool of criminal law.”
It was observed that in view of the clear bar contained in Section 4 of the Benami Act, the complainant could not have sued the accused appellants for the same set of facts and allegations which are made the foundation of the criminal proceedings.
Moreover, apart from a bald allegation made by the complainant that A-1 abused him and intimidated him on July 28, 2010, there was no material to show that the accused indulged in criminal intimidation of the complainant so as to justify invocation of the offence punishable under Section 506(ii) IPC.
“Thus, we are persuaded to accept the contention of learned counsel for the accused appellants to hold that the criminal prosecution instituted against the accused appellants in pursuance of the totally frivolous FIR tantamounts to sheer abuse of the process of law”, the Bench held.
Allowing the appeal, the Bench quashed all the proceedings sought to be taken against the appellants in pursuance of the charge sheet.
Read Order: COL. RAMNEESH PAL SINGH v. SUGANDHI AGGARWAL [SC- CIVIL APPEAL NO(S). 6137 OF 2024]
LE Correspondent
New Delhi, May 17, 2024: While observing that the Indian Armed Forces provide a robust support system to the kin of its officers,the Supreme Court has upheld the order of a Family Court granting custody of minor children to the father, serving as a Colonel in the Armed Forces, and providing visitation rights to the mother.The Apex Court also opined that Parental Alienation Syndrome (PAS) is a thoroughly convoluted and intricate phenomenon that requires serious deliberation.
The marriage between the Appellant, serving as a Colonel in the Indian Armed Forces and the Respondent, who is employed as a teacher in Delhi Public School, was solemnized in the year 2002.They have two minor children, a 15 year-old daughter (SSU) and a 12-year-old son (SSH).
In December 2013, the Appellant, having been promoted to the rank of Colonel in the Indian Armed Forces, was posted to serve in Jammu and Kashmir. Accordingly, it was decided that the Respondent together with the minor children would reside in New Delhi. The relationship between the parties deteriorated significantly and thereafter took a turn for the worst in the year 2015, forcing the Respondent to leave the matrimonial home along with the minor children.
Subsequently, the Respondent learnt that the minor children along with the Appellant were residing in Gulmarg, Jammu and Kashmir and were scheduled to move to Bikaner, Rajasthan in furtherance of the nature of the Appellant’s service. Aggrieved, the Respondent filed a petition under Section 7, 9 and 25 of the Guardian and Wards Act, 1890 before the Family Court seeking custody of the minor children.The Family Court had granted permanent custody of minor children to the Appellant and provided visitation rights to the Respondent.
The appeal preferred by the Appellant sought to assail the correctness of an order passed by a Division Bench of the Delhi High Court whereby the appeal preferred by the Respondent challenging the Family Court's order was partly allowed. Vide the impugned order, the High Court granted the parties shared custody of the minor children.
Referring to the judgment in V. Ravi Chandran (Dr.) (2) v. Union of India) [LQ/SC/2009/2029],the Division Bench of Justices Vikram Nath & Satish Chandra Sharma said, “It is well settled that the principal consideration of the Court whilst deciding an application for guardianship under the Act in exercise of its parens patriae jurisdiction would be the ‘welfare’ of the minor children.”
The Bench took note of the fact that the minor children i.e., SSU and SSH had interacted with the Family Court expressing their preference to reside with the Appellant. Additionally, it was observed that the minor children were doing well in the pursuit of their education and co-curricular activities whilst residing with the Appellant.
The Division Bench observed that the minor children expressed their clear desire to reside with the Appellant.The Top Court also on an earlier occasion had interacted with the minor children and they categorically stated that they were happy and wished to reside with their father only i.e., the Appellant.
The natural and consequential deduction from the aforesaid interactions between the minor children and various Courts over a period spanning over four years, was the unwavering and strong desire of the children to continue to reside with the Appellant.
Next, the Bench dealt with the contentions in relation to the nature of employment of the Appellant posing a challenge in the upbringing and welfare of the Minor Children.The Bench was unable to subscribe to the aforesaid view in light of the fact that the Indian Armed Forces provides a robust support system to the kin of its officers so as to ensure minimal disruption in the lives of the civilian members of an officer’s family.
According to the Bench, the High Court had failed to appreciate the intricacies and complexities of the relationship between the parties and accordingly, proceeded to entertain allegations of PAS on an unsubstantiated basis. PAS is a thoroughly convoluted and intricate phenomenon that requires serious consideration and deliberation. Referring to the judgment in Vivek Singh v. Romani Singh [LQ/SC/2017/223], the Bench said, “Courts must endeavour to identify individual instances of ‘alienating behaviour’ in order to invoke the principle of parental alienation so as to overcome the preference indicated by the minor children.”
Further, referring to the earlier orders, the Bench concluded that the minor children did not foster unbridled and prejudiced emotions towards the Respondent and the appellant could not have been said to have engaged or propagated ‘alienating behaviour’ as alleged by the Respondent.
The High Court failed to appreciate the aforesaid nuance and proceeded on an unsubstantiated assumption i.e., that allegations of parental alienation could not be ruled out, despite the stark absence of any instances of 'alienating behaviour' having been identified by any Court.
Thus, allowing the appeal and setting aside the impugned order, the Bench held, “In view of the aforesaid discussion, we consider it just and appropriate that the custody of the Minor Children is retained by the Appellant, subject to the visitation rights of the Respondent as granted by the Family Court vide the Underlying Order i.e., the final order dated 22.08.2020.”
Read Order: M/S. EMBIO LIMITED v. DIRECTOR GENERAL OF FOREIGN TRADE & ORS [SC- CIVIL APPEAL NO. 6394 OF 2024[
Tulip Kanth
New Delhi, May 17, 2024: While setting aside an order imposing a penalty of over Rs 23 lakh on Karnataka Biotics,the Supreme Court has clarified that Section 11(2) of the Foreign Trade (Development and Regulation) Act, 1992 is a penal provision which must be strictly construed.
Karnataka Malladi Biotics Limited (Karnataka Biotics) obtained an Export Promotion Capital Goods Licence (licence), which enabled it to import certain capital equipment at a concessional rate of customs duty. Under the licence, Karnataka Biotics was permitted to import capital goods worth Rs 23,38,882 equivalent to US$ 64,987 CIF value, subject to the condition of the appellant exporting the finished goods worth US$ 2,59,948 and earning an equivalent amount in a freely convertible foreign currency within five years from the date of the licence.
Karnataka Biotics imported goods as permitted under the licence and commenced commercial production. However, the Board for Industrial Finance and Reconstruction (BIFR) declared Karnataka Biotics as a sick unit under Section 3(1)(o) of the Sick Industrial Companies (Special Provisions) Act, 1985 (SICA). The said company submitted a rehabilitation proposal to the operating agency. As Karnataka Biotics had enjoyed the benefit of concessional duty, a demand notice was issued by the Commissioner of Customs, making a demand for the differential duty of Rs. 5,38,525/- from Karnataka Biotics. As the said company could not pay the demanded amount, a sum of Rs. 4,86,800/- was recovered by enforcing the bank guarantee furnished by the said company.
The BIFR sanctioned Karnataka Biotic's rehabilitation scheme under Section 18 of SICA. The third respondent passed an Order-in-Original imposing a penalty of Rs. 23,38,882 on Karnataka Biotics for non-fulfilment of export obligation under the licence.
The appellant was formerly known as Emmellen Biotech Pharmaceuticals Limited, which amalgamated with Karnataka Malladi Biotics Limited in 2009. The appellant filed a Writ Petition under Article 226 of the Constitution of India before the Karnataka High Court, challenging the order imposing a penalty of Rs. 23,38,882 which was dismissed. By the impugned judgment, a Writ Appeal against the order of the Single Judge was dismissed.Hence, appeal was filed before the Top Court.
The Division Bench of Justice Abhay S. Oka and Justice Ujjal Bhuyan noted that in the present case, there was no allegation made by the respondents against the appellant's predecessor of making or attempting to make any export or import in contravention of the FT Act, any Rules or orders made thereunder, or the foreign trade policy.
Under the license granted to the appellant’s predecessor, there was an obligation to export finished goods by earning foreign exchange equivalent to USD 2,59,948 within a period of five years. The allegation was of the failure to abide by the obligation to export the finished goods within a period of five years. Thus, there was no allegation of attempting to make an export or import, which is covered by Section 11 (2).
“There is no allegation against the appellant or its predecessor of making an export or import in contravention of the export and import policy. Section 11 (2) is a penal provision. It must be strictly construed. Thus, the demand for penalty cannot be sustained. Hence, we set aside the impugned judgments and orders of the learned Single Judge and Division Bench”, the Bench held.
Thus, allowing the appeal, the Bench set aside the Order In-Original by which the impugned penalty was imposed.
Read Order: DASARI SRIKANTH v. STATE OF TELANGANA [SC- CRIMINAL APPEAL NO(S). 2580 OF 2024]
LE Correspondent
New Delhi, May 17,2024: Taking note of the fact that the appellant-accused and the complainant-woman had married each other during the pendency of the appeal, the Supreme Court has acquitted the accused in a case of criminal intimidation and stalking.
The Division Bench of Justice B.R. Gavai & Justice Sandeep Mehta was considering an appeal preferred by the appellant for assailing the judgment passed by the Telangana High Court upholding his conviction for offences under Sections 354D and 506-Part I of the Indian Penal Code, 1860(IPC), but reducing the sentence of imprisonment for both the offences to three months.
The accused appellant was tried by the Special Fast Track Court, Suryapet(trial Court). The trial Court acquitted the accused appellant for the offences under Section 11 read with Section 12 of the Protection of Children from Sexual Offences Act, 2012(POCSO Act) but at the same time, convicted and sentenced him for offences under Sections 354D and 506-Part I IPC. He was sentenced to undergo rigorous imprisonment for 2 years u/s 354 and simple Imprisonment for 6 months u/s 506.
The High Court reduced the sentences awarded to the accused appellant to three months on both counts.
It was pleaded before the Top Court that the appellant and the complainant(victim) had married each other on August 6, 2023 as per the Hindu rites and customs. The marriage had also been registered in the Office of Registrar of Hindu Marriages and Sub Registrar.
The State Counsel had filed a compliance affidavit sworn by the Sub-Inspector of the police station concerned who verified the fact that the appellant and the complainant had solemnized marriage with each other and the marriage was registered as per the Hindu Marriage Act, 1955.The Top Court noted that the Trial Court did not find the offences under the POCSO Act proved and acquitted the accused appellant from the said charges.
The Division Bench opined that the offences under Section 354D IPC and Section 506 IPC are personal to the complainant and the accused appellant. “The fact that the appellant and the complainant have married each other during the pendency of this appeal gives rise to a reasonable belief that both were involved in some kind of relationship even when the offences alleged were said to have been committed”, the Bench said.
The Top Court was of the view that since, the appellant and the complainant have married each other, the affirmation of the judgment rendered by the High Court would have the disastrous consequence on the accused appellant being sent to jail which in turn could put his matrimonial relationship with the complainant in danger.
Thus, setting aside the impugned judgments, the Top Court exercised its powers under Article 142 of the Constitution of India for quashing the conviction of the accused appellant as recorded by the trial Court and modified by the High Court. The Bench concluded the matter by observing, “The appellant is acquitted of the charges.”
Read Order: SHIVENDRA PRATAP SINGH THAKUR @ BANTI v. STATE OF CHHATTISGARH AND ORS [SC- CRIMINAL APPEAL NO(S). 2588 OF 2024]
Tulip Kanth
New Delhi, May 17, 2024: While observing that the allegation levelled by the complainant that the accused demolished the boundary wall was not substantiated and there was an imminent possibility of enmity between the parties, the Supreme Court has quashed an FIR registered under Sections 447, 427, 294, 506 read with Section 34 of the Indian Penal Code, 1860.
It was alleged in the FIR that respondent No. 5-Barkat Ali i.e. the complainant, had purchased the land in Bilaspur from one Geeta Rai, for a consideration of Rs. 25,00,000. A registered sale deed was executed and the complainant came into possession of the said land. The adjacent plot was purchased by one Sushma Kashyap, wife of Rajkumar Kashyap from the land owner Geeta Rai in the year 2016. The complainant and Sushma Kashyap were allegedly in possession of their respective plots and had raised construction of houses thereupon.
The complainant alleged that he had built a boundary wall for the protection of his plot with a gate and grill and that he had stored cement, rods and other construction materials on the plot. It was alleged that accused Saurabh Pratap Singh Thakur and appellantShivendra Pratap Singh Thakur @ Banti, in furtherance of their common intention trespassed into the land in possession of the complainant and demolished the under construction house of Sushma Kashyap and the boundary wall of the complainant-Barkat Ali. The accused also stole raw materials kept at the complainant's land thereby, causing loss of Rs.4 lakhs and Rs. 6 lakhs to Sushma Kashyap and the complainant, respectively.
The complainant confronted the accused about their criminal acts but the accused threatened the complainant of dire consequences in presence of witnesses Uma, Shankar Sahu, Vishnu Sahu and other labourers.
The appellant approached the Top Court with an appeal by special leave for assailing the order of the Single Judge of the Chhattisgarh High Court dismissing his Petition seeking quashment of FIR registered under Sections 447, 427, 294, 506 read with Section 34 of the Indian Penal Code, 1860 and the charge sheet filed as a consequence of investigation of the said FIR.
The 3-Judge Bench of Justice B.R. Gavai, Justice Satish Chandra Sharma and Justice Sandeep Mehta opined that the FIR was lodged by complainant-Barkat Ali on June 29, 2019 with the allegation that the offences alleged were committed by the appellant and co-accused some time prior to May 20, 2019. Thus, the complainant was not even sure of the date on which the alleged offences were committed. No reason whatsoever had been given in the FIR for the huge delay of more than 39 days in approaching the police.
The site plan prepared by the Investigating Officer revealed that so far as the plot of Purnima Begum, wife of Barkat Ali was concerned, it is fully encumbered by a boundary wall and no damage was shown to this structure. The site plan indicated that there was some damage to the under-construction house of Sushma Kashyap. In the FIR, the damage suffered by the complainant was quantified at Rs. 6 lakhs whereas the damage suffered by Sushma Kashyap was quantified as Rs. 4 lakhs owing to the demolition of her under construction house. The Bench noted that surprisingly, Sushma did not lodge any complaint to the police.
On going through the contents of the FIR, the Bench didnot find any material therein which could justify invocation of the offence punishable under Section 294 IPC. “Except for the offence under Section 447 IPC, all the remaining offences are non-cognizable whereas the offence under Section 294 IPC is ex facie not made out from the allegations set out in the FIR and the charge sheet. The allegation levelled by the complainant that the accused demolished the boundary wall constructed on the land in his possession has not been found to be substantiated during spot inspection”, the Bench said.
It was thus, apparent that there was an imminent possibility of animus between the complainant and the accused persons on this count. As per the Bench, the FIR which was lodged after 39 days of the incident, did not indicate the date or time, when the accused trespassed into the house of the complainant and caused damage to his property and committed the other offences for which the FIR came to be registered.
“Therefore, we are of the view that the impugned FIR seems to be nothing but a tool to wreak vengeance against the appellant herein”, the Bench held while allowing the appeal and quashing the FIR as well as subsequent proceedings arising therefrom.
Read Order: BHIKCHAND S/O DHONDIRAM MUTHA (DECEASED) THROUGH LRS v. SHAMABAI DHANRAJ GUGALE (DECEASED) THROUGH LRS[SC- CIVIL APPEAL NO. 5026 OF 2023]
Tulip Kanth
New Delhi, May 17, 2024: The Supreme Court has observed that the execution of a decree by sale of the entire immovable property of the judgment debtor is not to penalize him but the same is provided to grant relief to the decree holder and to confer him the fruits of litigation. However, the right of a decree holder should never be construed to have bestowed upon him a bonanza only because he had obtained a decree for realization of a certain amount.
The facts of the case were such that Dhanraj, the husband of the original plaintiff - Shamabai Dhanraj Gugale advanced a loan of Rs. 8,000 to the original defendant – appellant/judgment debtor in the year 1969. Upon his failure to repay the debt, the original plaintiff instituted a Special Civil Suit for recovery of Rs. 10,880/ and for other ancillary reliefs and costs. The Joint Civil Judge partly decreed the suit. The plaintiff-decree holder preferred an execution application which came to be transferred to the court of Civil Judge because the property belonging to the judgment debtor against which the decretal amount was to be recovered fell within the jurisdiction of Ahmednagar court.
The civil appeal preferred by the original plaintiff came to be dismissed by the district court and at the same time the defendants cross objections were allowed to the extent of interest and cost. The total decretal amount of Rs.27694/- thus stood reduced to Rs. 17120/-. Before the decision rendered by the appellate court, the plaintiff/decree holder executed the decree and the properties of the defendant/judgment debtor were put to auction and were purchased by the original plaintiffs/decree holders themselves for a sum of Rs. 34000/- in the auction which was confirmed by the Executing Court.
The present appellant/judgment debtor moved an application for restitution under Section 144 CPC on the ground that the original decree having been varied, substantially, the execution sale deserved to be set aside and reversed by way of restitution. The Courts below had concurrently rejected the appellant/judgment debtors application for restitution basing the reasoning that he had not deposited any amount in court, when the suit was originally decreed and the decree was put in execution, and not even a part of the amount which was finally decreed by the appeal court was deposited, hence, the principle of restitution was not invokable.Aggrieved thereby, the appellant approached the Top Court.
The Division Bench of Justice Hrishikesh Roy and Justice Prashant Kumar Mishra reiterated the settled principle of law that courts power to auction any property or part thereof is not just a discretion but an obligation imposed on the Court and the sale held without examining this aspect and not in conformity with this mandatory requirement would be illegal and without jurisdiction.
The Top Court explained that the object of attachment of immovable property in the course of execution of decree is for realisation of the decretal amount by way of the sale of the attached property under Order XXI Rule 66 CPC.
It was made clear by the Bench that sub-rule (2) of Rule 66 of Order XXI CPC mandates that the sale proclamation should mention the estimated value of the property and such estimated value can also be given under Rule 54 Order XXI CPC. Reference was also made to Rule 54(1) Order XXI read with Rule 66 of Order XXI CPC wherein it is provided that either whole of the attached property or such portion thereof as may seem necessary to satisfy the decree shall be sold in auction.
The assessed value of all the attached properties, in this case, is Rs. 1,05,700/- whereas the original decretal sum was Rs. 27,694/- which is about 26.2% of the total value of the property. Therefore, the Bench opined that when only one of the attached properties was sufficient to satisfy the decree there was no requirement for effecting the sale of the entire attached properties.
In the case at hand, the Executing Court did not discharge its duty to ascertain whether the sale of a part of the attached property would be sufficient to satisfy the decree. “When the valuation of three attached properties is mentioned in the attachment Panchanama, it was the duty of the Court to have satisfied itself on this aspect and having failed to do so the Court has caused great injustice to the judgment debtor by auctioning his entire attached properties causing huge loss to the judgment debtor and undue benefit to the auction purchaser”, it added.
The fact that the properties were sold for a sum of Rs. 34,000 would further demonstrate that the decree holder who himself is the auction purchaser had calculatedly offered a bid at Rs. 34,000 despite being aware that the value of the attached properties is Rs. 1,05,700.
“A decree for realisation of a sum in favour of the plaintiff should not amount to exploitation of the judgment debtor by selling his entire property”, the Bench held while allowing the application under Section 144 CPC and setting aside the sale of the attached properties belonging to the judgment debtor.
The Top Court also ordered that the parties be restored back to the position where the execution was positioned before the attachment of the immovable properties of the judgment debtor. The execution of the modified decree, if not already satisfied, has been asked to proceed in accordance with law.
Read Order: The Divisional Forest Officer, Munnar, Kerala, and another v. P.J. Antony, etc [SC- CIVIL APPEAL NOS. 9751-9752 OF 2011]
Tulip Kanth
New Delhi, May 17, 2024: While dismissing an appeal filed by the Divisional Forest Officer against a Kerala High Court judgment setting aside the order of confiscation of sandalwood, the Supreme Court has remarked that it was very surprising that the Forest Department in the State of Kerala had not maintained a record of the sandalwood trees growing in reserved forest lands and also private patta lands in the year 2001.
In this case, respondents- P.J. Antony claimed ownership and possession over 4.70 hectares of land in a plot of land situated in Marayoor Village while Cheriyan Kuruvila claimed title and possession over an extent of 1.09 hectares in the adjacent plot. P.J. Antony submitted an application to the Tahsildar, Devikulam, for issuance of a certificate for handing over the dried and fallen sandalwood trees in his land to the Forest Department. A similar application was also filed by Cheriyan Kuruvila. These applications were made in accordance with the scheme envisaged under G.O (MS) No. 126/773/AD, Agriculture (Forest) Department, dated 03.04.1973, which empowered the Forest Department to auction sandalwood trees grown on private lands and pay 70% of the sale proceeds to the landowners leaving the remaining 30% with the Department.
In 2001, Certificate was issued by the Village Officer.Thereafter, the Range Officer seized the sandalwood trees on getting secret information that sandalwood trees had been illegally uprooted and kept in the house of P.J. Antony. On inspection, 77 sandalwood trees, 41 pieces of sandalwood, 7 sandalwood stumps and 56 small roots were found illegally kept in the backside of the courtyard of House of Marayoor Panchayat. A confiscation order was passed but the same was set aside by the Conservator of Forest, High Range Circle, Kottayam, In consequence, the Divisional Forest Officer,reconsidered the case but again confirmed the seizure. Antony and Kuruvila approached the District Judge but their appeal was dismissed. This led to their filing writ petitions before the High Court of Kerala, which resulted in the passing of the impugned judgment.
The Division Bench of Justice A.S. Bopanna & Justice Sanjay Kumar took note of the admitted fact that earlier, during the year 1995, sandalwood trees had grown in the lands of P.J. Antony were sold in consultation with the Forest Department as per the Government's scheme. This fact was sufficient to indicate that sandalwood trees did grow in these lands. The documentation of the trees found in these lands in the year 2001, certified by the Revenue officials, was not liable to be rejected or eschewed as the Forest Department was unable to elicit anything to the contrary in the cross-examination of these officials.
It was further opined that the admissions of the Range Officer were sufficiently damaging in themselves. Those admissions were more than enough to decimate the case sought to be put forth by the Forest Department that a forest offence was committed by P.J. Antony and Cheriyan Kuruvila.
Reliance was placed upon Sections 52 and 61A of the Forest Act, dealing with seizure and confiscation of sandalwood etc., which require the officer concerned to come to the conclusion that there was a reason to believe that a forest offence had been committed. Section 2(e) of the Forest Act defines a forest offence to mean an offence punishable under the Forest Act or any Rule made thereunder. However, it was an admitted fact that the offence, if any, committed by P.J. Antony and Cheriyan Kuruvila in relation to the movement of the fallen and dried sandalwood, so as to stack it at one place, would be relatable to the KPT Act and would not constitute an offence under the Forest Act. Moreover, there was no answer forthcoming from the Forest Department as to how a forest offence was made out in the case on hand.
The Bench refused to agree with the claim of the Forest Department that a presumption would arise under Section 69 of the Forest Act, whereby commission of a forest offence could be inferred, but we are not persuaded to agree. Section 69 merely states that, when a question arises as to whether any forest produce is the property of the Central or State Governments, such produce shall be presumed to be the property of the Central Government or State Government, as the case may be, until the contrary is proved.
“It is indeed surprising, if not shocking, that the Forest Department in the State of Kerala had not maintained a record of the sandalwood trees growing in reserved forest lands and also private patta lands. There was no marking of such trees to identify them for the purpose of such record”, the Bench said.
Thus, the Bench opined that the High Court of Kerala was fully justified in setting aside the confiscation order. Dismissing the appeals, the Bench ordered the Forest Department to proceed in accordance with the Government’s scheme and conclude the same expeditiously and, in any event, not later than three months.
Read Order: PRABIR PURKAYASTHA v. STATE (NCT OF DELHI) [SC- CRIMINAL APPEAL NO(S). 2577 OF 2024]
Tulip Kanth
New Delhi, May 16, 2024: Taking note of the fact that the arrest memo did not indicate the grounds of arrest and a copy of the remand application was not provided to the accused-appellant or his counsel, the Supreme Court has set aside the arrest of Prabir Purkayastha, the Founder and Editor-in-chief of online news portal NewsClick in a case pertaining to the Unlawful Activities(Prevention) Act, 1967.
The factual background of this case was that the officers of the Special Cell had carried out extensive raids at the residential and official premises of the appellant and the company, namely, M/s. PPK Newsclick Studio Pvt. Ltd. of which the appellant is the Director in connection with an FIR registered under Sections 13, 16, 17, 18, 22C of the Unlawful Activities(Prevention) Act, 1967(UAPA) read with Section 153A, 120B of the Indian Penal Code, 1860(IPC). During the course of the search and seizure proceedings, numerous documents and digital devices belonging to the appellant, the company and other employees of the company were seized. The appellant was arrested in connection with the said FIR on October 3, 2023 vide arrest memo which was in a computerized format and did not contain any column regarding the grounds of arrest of the appellant. This very issue was primarily the bone of contention between the parties to the appeal.
The appeal before the Top Court was filed against a Delhi High Court order dismissing the appellant’s plea to declare his arrest as illegal and in gross violation of his fundamental rights under Article 21 and 22 of the Constitution. The appellant's request to set aside the remand order was also declined.
The ASG had advanced a fervent contention regarding application of ratio of Pankaj Bansal v. Union of India and Others by urging that there was an inherent difference between the provisions contained in Section 19 of the PMLA and Section 43A and 43B of the UAPA.
On a perusal of the provisions, the Division Bench of Justice B.R. Gavai and Justice Sandeep Mehta opined that there was no significant difference in the language employed in Section 19(1) of the PMLA and Section 43B(1) of the UAPA which could persuade one to take a view that that the interpretation of the phrase inform him of the grounds for such arrest made by this Court in the case of Pankaj Bansal(supra) should not be applied to an accused arrested under the provisions of the UAPA.
“We find that the provision regarding the communication of the grounds of arrest to a person arrested contained in Section 43B(1) of the UAPA is verbatim the same as that in Section 19(1) of the PMLA”, the Bench said while also adding, “...the interpretation of statutory mandate laid down by this Court in the case of Pankaj Bansal(supra) on the aspect of informing the arrested person the grounds of arrest in writing has to be applied pari passu to a person arrested in a case registered under the provisions of the UAPA.”
According to the Apex Court, any person arrested for allegation of commission of offences under the provisions of UAPA or for that matter any other offence(s) has a fundamental and a statutory right to be informed about the grounds of arrest in writing and a copy of such written grounds of arrest have to be furnished to the arrested person as a matter of course and without exception at the earliest.
“The right to be informed about the grounds of arrest flows from Article 22(1) of the Constitution of India and any infringement of this fundamental right would vitiate the process of arrest and remand. Mere fact that a charge sheet has been filed in the matter, would not validate the illegality and the unconstitutionality committed at the time of arresting the accused and the grant of initial police custody remand to the accused”, the Bench held.
From a holistic reading of various judgments pertaining to the law of preventive detention the Bench highlighted the consistent view of this Court that the grounds on which the liberty of a citizen is curtailed, must be communicated in writing so as to enable him to seek remedial measures against the deprivation of liberty. Thus, it was held that the submission of ASG that in a case of preventive detention, the grounds of detention need not be provided to a detenue in writing, was facie untenable in eyes of law.
Having no hesitation in reiterating that the requirement to communicate the grounds of arrest or the grounds of detention in writing to a person arrested in connection with an offence or a person placed under preventive detention as provided under Articles 22(1) and 22(5) of the Constitution of India is sacrosanct and cannot be breached under any situation, the Bench held that further non- compliance of this constitutional requirement and statutory mandate would lead to the detention being rendered illegal, as the case may be. It was asserted by the Bench that the provisions of Article 22(1) have already been interpreted by this Court in Pankaj Bansal(supra) laying down beyond the pale of doubt that the grounds of arrest must be communicated in writing to the person arrested of an offence at the earliest.
As per the Bench, the interpretation given by the Single Judge that the grounds of arrest were conveyed to the accused in writing vide the arrest memo was unacceptable as the arrest memo did not indicate the grounds of arrest being incorporated in the said document.
The Bench also asserted, “We are of the firm opinion that once this Court has interpreted the provisions of the statute in context to the constitutional scheme and has laid down that the grounds of arrest have to be conveyed to the accused in writing expeditiously, the said ratio becomes the law of the land binding on all the Courts in the country by virtue of Article 141 of the Constitution of India.”
Moreover, it was also observed that the copy of the remand application in the purported exercise of communication of the grounds of arrest in writing was not provided to the accused appellant or his counsel before passing of the order of remand dated October 4, 2023 which vitiates the arrest and subsequent remand of the appellant.
Thus, allowing the appeal, the Bench declared the arrest of the appellant followed by the remand order and HC's order to be invalid in the eyes of law.
Time for judiciary to introspect and see what can be done to restore people’s faith – Justice Lokur
Justice Madan B Lokur, was a Supreme Court judge from June 2012 to December 2018. He is now a judge of the non-resident panel of the Supreme Court of Fiji. He spoke to LegitQuest on January 25, 2020.
Q: You were a Supreme Court judge for more than 6 years. Do SC judges have their own ups and downs, in the sense that do you have any frustrations about cases, things not working out, the kind of issues that come to you?
A: There are no ups and downs in that sense but sometimes you do get a little upset at the pace of justice delivery. I felt that there were occasions when justice could have been delivered much faster, a case could have been decided much faster than it actually was. (When there is) resistance in that regard normally from the state, from the establishment, then you kind of feel what’s happening, what can I do about it.
Q: So you have had the feeling that the establishment is trying to interfere in the matters?
A: No, not interfering in matters but not giving the necessary importance to some cases. So if something has to be done in four weeks, for example if reply has to be filed within four weeks and they don’t file it in four weeks just because they feel that it doesn’t matter, and it’s ok if we file it within six weeks how does it make a difference. But it does make a difference.
Q: Do you think this attitude is merely a lax attitude or is it an infrastructure related problem?
A: I don’t know. Sometimes on some issues the government or the establishment takes it easy. They don’t realise the urgency. So that’s one. Sometimes there are systemic issues, for example, you may have a case that takes much longer than anticipated and therefore you can’t take up some other case. Then that necessarily has to be adjourned. So these things have to be planned very carefully.
Q: Are there any cases that you have special memories of in terms of your personal experiences while dealing with the case? It might have moved you or it may have made you feel that this case is really important though it may not be considered important by the government or may have escaped the media glare?
A: All the cases that I did with regard to social justice, cases which concern social justice and which concern the environment, I think all of them were important. They gave me some satisfaction, some frustration also, in the sense of time, but I would certainly remember all these cases.
Q: Even though you were at the Supreme Court as a jurist, were there any learning experiences for you that may have surprised you?
A: There were learning experiences, yes. And plenty of them. Every case is a learning experience because you tend to look at the same case with two different perspectives. So every case is a great learning experience. You know how society functions, how the state functions, what is going on in the minds of the people, what is it that has prompted them to come the court. There is a great learning, not only in terms of people and institutions but also in terms of law.
Q: You are a Judge of the Supreme Court of Fiji, though a Non-Resident Judge. How different is it in comparison to being a Judge in India?
A: There are some procedural distinctions. For example, there is a great reliance in Fiji on written submissions and for the oral submissions they give 45 minutes to a side. So the case is over within 1 1/2 hours maximum. That’s not the situation here in India. The number of cases in Fiji are very few. Yes, it’s a small country, with a small number of cases. Cases are very few so it’s only when they have an adequate number of cases that they will have a session and as far as I am aware they do not have more than two or three sessions in a year and the session lasts for maybe about three weeks. So it’s not that the court sits every day or that I have to shift to Fiji. When it is necessary and there are a good number of cases then they will have a session, unlike here. It is then that I am required to go to Fiji for three weeks. The other difference is that in every case that comes to the (Fiji) Supreme Court, even if special leave is not granted, you have to give a detailed judgement which is not the practice here.
Q: There is a lot of backlog in the lower courts in India which creates a problem for the justice delivery system. One reason is definitely shortage of judges. What are the other reasons as to why there is so much backlog of cases in the trial courts?
A: I think case management is absolutely necessary and unless we introduce case management and alternative methods of dispute resolution, we will not be able to solve the problem. I will give you a very recent example about the Muzaffarpur children’s home case (in Bihar) where about 34 girls were systematically raped. There were about 17 or 18 accused persons but the entire trial finished within six months. Now that was only because of the management and the efforts of the trial judge and I think that needs to be studied how he could do it. If he could do such a complex case with so many eyewitnesses and so many accused persons in a short frame of time, I don’t see why other cases cannot be decided within a specified time frame. That’s case management. The second thing is so far as other methods of disposal of cases are concerned, we have had a very good experience in trial courts in Delhi where more than one lakh cases have been disposed of through mediation. So, mediation must be encouraged at the trial level because if you can dispose so many cases you can reduce the workload. For criminal cases, you have Plea Bargaining that has been introduced in 2009 but not put into practice. We did make an attempt in the Tis Hazari Courts. It worked to some extent but after that it fell into disuse. So, plea bargaining can take care of a lot of cases. And there will be certain categories of cases which we need to look at carefully. For example, you have cases of compoundable offences, you have cases where fine is the punishment and not necessarily imprisonment, or maybe it’s imprisonment say one month or two month’s imprisonment. Do we need to actually go through a regular trial for these kind of cases? Can they not be resolved or adjudicated through Plea Bargaining? This will help the system, it will help in Prison Reforms, (prevent) overcrowding in prisons. So there are a lot of avenues available for reducing the backlog. But I think an effort has to be made to resolve all that.
Q: Do you think there are any systemic flaws in the country’s justice system, or the way trial courts work?
A: I don’t think there are any major systemic flaws. It’s just that case management has not been given importance. If case management is given importance, then whatever systematic flaws are existing, they will certainly come down.
Q; And what about technology. Do you think technology can play a role in improving the functioning of the justice delivery system?
I think technology is very important. You are aware of the e-courts project. Now I have been told by many judges and many judicial academies that the e-courts project has brought about sort of a revolution in the trial courts. There is a lot of information that is available for the litigants, judges, lawyers and researchers and if it is put to optimum use or even semi optimum use, it can make a huge difference. Today there are many judges who are using technology and particularly the benefits of the e-courts project is an adjunct to their work. Some studies on how technology can be used or the e-courts project can be used to improve the system will make a huge difference.
Q: What kind of technology would you recommend that courts should have?
A: The work that was assigned to the e-committee I think has been taken care of, if not fully, then largely to the maximum possible extent. Now having done the work you have to try and take advantage of the work that’s been done, find out all the flaws and see how you can rectify it or remove those flaws. For example, we came across a case where 94 adjournments were given in a criminal case. Now why were 94 adjournments given? Somebody needs to study that, so that information is available. And unless you process that information, things will just continue, you will just be collecting information. So as far as I am concerned, the task of collecting information is over. We now need to improve information collection and process available information and that is something I think should be done.
Q: There is a debate going on about the rights of death row convicts. CJI Justice Bobde recently objected to death row convicts filing lot of petitions, making use of every legal remedy available to them. He said the rights of the victim should be given more importance over the rights of the accused. But a lot of legal experts have said that these remedies are available to correct the anomalies, if any, in the justice delivery. Even the Centre has urged the court to adopt a more victim-centric approach. What is your opinion on that?
You see so far as procedures are concerned, when a person knows that s/he is going to die in a few days or a few months, s/he will do everything possible to live. Now you can’t tell a person who has got terminal cancer that there is no point in undergoing chemotherapy because you are going to die anyway. A person is going to fight for her/his life to the maximum extent. So if a person is on death row s/he will do everything possible to survive. You have very exceptional people like Bhagat Singh who are ready to face (the gallows) but that’s why they are exceptional. So an ordinary person will do everything possible (to survive). So if the law permits them to do all this, they will do it.
Q: Do you think law should permit this to death row convicts?
A: That is for the Parliament to decide. The law is there, the Constitution is there. Now if the Parliament chooses not to enact a law which takes into consideration the rights of the victims and the people who are on death row, what can anyone do? You can’t tell a person on death row that listen, if you don’t file a review petition within one week, I will hang you. If you do not file a curative petition within three days, then I will hang you. You also have to look at the frame of mind of a person facing death. Victims certainly, but also the convict.
Q: From the point of jurisprudence, do you think death row convicts’ rights are essential? Or can their rights be done away with?
A: I don’t know you can take away the right of a person fighting for his life but you have to strike a balance somewhere. To say that you must file a review or curative or mercy petition in one week, it’s very difficult. You tell somebody else who is not on a death row that you can file a review petition within 30 days but a person who is on death row you tell him that I will give you only one week, it doesn’t make any sense to me. In fact it should probably be the other way round.
Q: What about capital punishment as a means of punishment itself?
A: There has been a lot of debate and discussion about capital punishment but I think that world over it has now been accepted, more or less, that death penalty has not served the purpose for which it was intended. So, there are very few countries that are executing people. The United States, Saudi Arabia, China, Pakistan also, but it hasn’t brought down the crime rate. And India has been very conservative in imposing the death penalty. I think the last 3-4 executions have happened for the persons who were terrorists. And apart from that there was one from Calcutta who was hanged for rape and murder. But the fact that he was hanged for rape and murder has not deterred people (from committing rape and murder). So the accepted view is that death penalty has not served the purpose. We certainly need to rethink the continuance of capital punishment. On the other hand, if capital punishment is abolished, there might be fake encounter killings or extra judicial killings.
Q: These days there is the psyche among people of ‘instant justice’, like we saw in the case of the Hyderabad vet who was raped and murdered. The four accused in the case were killed in an encounter and the public at large and even politicians hailed it as justice being delivery. Do you think this ‘lynch mob mentality’ reflects people’s lack of faith in the justice system?
A: I think in this particular case about what happened in Telangana, investigation was still going on. About what actually happened there, an enquiry is going on. So no definite conclusions have come out. According to the police these people tried to snatch weapons so they had to be shot. Now it is very difficult to believe, as far as I am concerned, that 10 armed policeman could not overpower four unarmed accused persons. This is very difficult to believe. And assuming one of them happened to have snatched a (cop’s) weapon, maybe he could have been incapacitated but why the other three? So there are a lot of questions that are unanswered. So far as the celebrations are concerned, the people who are celebrating, do they know for certain that they (those killed in the encounter) were the ones who did the crime? How can they be so sure about it? They were not eye witnesses. Even witnesses sometimes make mistakes. This is really not a cause for celebration. Certainly not.
Q: It seems some people are losing their faith in the country’s justice delivery system. How to repose people’s faith in the legal process?
A: You see we again come back to case management and speedy justice. Suppose the Nirbhaya case would have been decided within two or three years, would this (Telangana) incident have happened? One can’t say. The attack on Parliament case was decided in two or three years but that has not wiped out terrorism. There are a lot of factors that go into all this, so there is a need to find ways of improving justice delivery so that you don’t have any extremes – where a case takes 10 years or another extreme where there is instant justice. There has to be something in between, some balance has to be drawn. Now you have that case where Phoolan Devi was gangraped followed by the Behmai massacre. Now this is a case of 1981, it has been 40 years and the trial court has still not delivered a judgement. It’s due any day now, (but) whose fault is that. You have another case in Maharashtra that has been transferred to National Investigating Agency two years after the incident, the Bhima-Koregaon case. Investigation is supposedly not complete after two years also. Whose fault is that? So you have to look at the entire system in a holistic manner. There are many players – the investigation agency is one player, the prosecution is one player, the defence is one player, the justice delivery system is one player. So unless all of them are in a position to coordinate… you cannot blame only the justice delivery system. If the Telangana police was so sure that the persons they have caught are guilty, why did they not file the charge sheet immediately? If they were so sure the charge sheet should have been filed within one day. Why didn’t they do it?
Q: At the trial level, there are many instances of flaws in evidence collection. Do you think the police or whoever the investigators are, do they lack training?
A: Yes they do! The police lacks training. I think there is a recent report that has come out last week which says very few people (in the police) have been trained (to collect evidence).
Q: You think giving proper training to police to prepare a case will make a difference?
A: Yes, it will make a difference.
Q: You have a keen interest in juvenile justice. Unfortunately, a lot of heinous crimes are committed by juveniles. How can we correct that?
A: You see it depends upon what perspective we are looking at. Now these heinous crimes are committed by juveniles. Heinous crimes are committed by adults also, so why pick upon juveniles alone and say something should be done because juveniles are committing heinous crimes. Why is it that people are not saying that something should be done when adults are committing heinous crimes? That’s one perspective. There are a lot of heinous crimes that are committed against juveniles. The number of crimes committed against juveniles or children are much more than the crimes committed by juveniles. How come nobody is talking about that? And the people committing heinous crimes against children are adults. So is it okay to say that the State has imposed death penalty for an offence against the child? So that’s good enough, nothing more needs to be done? I don’t think that’s a valid answer. The establishment must keep in mind the fact that the number of heinous crimes against children are much more than those committed by juveniles. We must shift focus.
Q: Coming to NRC and CAA. Protests have been happening since December last year, the SC is waiting for the Centre’s reply, the Delhi HC has refused to directly intervene. Neither the protesters nor the government is budging. How do we achieve a breakthrough?
A: It is for the government to decide what they want to do. If the government says it is not going to budge, and the people say they are not going to budge, the stalemate could continue forever.
Q: Do you think the CAA and the NRC will have an impact on civil liberties, personal liberties and people’s rights?
A: Yes, and that is one of the reasons why there is protest all over the country. And people have realised that it is going to happen, it is going to have an impact on their lives, on their rights and that’s why they are protesting. So the answer to your question is yes.
Q: Across the world and in India, we are seeing an erosion of the value system upholding rights and liberties. How important is it for the healthy functioning of a country that social justice, people’s liberties, people’s rights are maintained?
A: I think social justice issues, fundamental rights are of prime importance in our country, in any democracy, and the preamble to our Constitution makes it absolutely clear and the judgement of the Supreme Court in Kesavananda Bharati and many other subsequent judgments also make it clear that you cannot change the basic structure of the Constitution. If you cannot do that then obviously you cannot take away some basic democratic rights like freedom of assembly, freedom of movement, you cannot take them away. So if you have to live in a democracy, we have to accept the fact that these rights cannot be taken away. Otherwise there are many countries where there is no democracy. I don’t know whether those people are happy or not happy.
Q: What will happen if in a democracy these rights are controlled by hook or by crook?
A: It depends upon how much they are controlled. If the control is excessive then that is wrong. The Constitution says there must be a reasonable restriction. So reasonable restriction by law is very important.
Q: The way in which the sexual harassment case against Justice Gogoi was handled was pretty controversial. The woman has now been reinstated in the Supreme Court as a staffer. Does this action of the Supreme Court sort of vindicate her?
A: I find this very confusing you know. There is an old joke among lawyers: Lawyer for the petitioner argued before the judge and the judge said you are right; then the lawyer for the respondent argued before the judge and the judge said you’re right; then a third person sitting over there says how can both of them be right and the judge says you’re also right. So this is what has happened in this case. It was found (by the SC committee) that what she said had no substance. And therefore, she was wrong and the accused was right. Now she has been reinstated with back wages and all. I don’t know, I find it very confusing.
Q: Do you think the retirement age of Supreme Court Judges should be raised to 70 years and there should be a fixed tenure?
A: I haven’t thought about it as yet. There are some advantages, there are some disadvantages. (When) You have extended age or life tenure as in the United States, and the Supreme Court has a particular point of view, it will continue for a long time. So in the United States you have liberal judges and conservative judges, so if the number of conservative judges is high then the court will always be conservative. If the number of liberal judges is high, the court will always be liberal. There is this disadvantage but there is also an advantage that if it’s a liberal court and if it is a liberal democracy then it will work for the benefit of the people. But I have not given any serious thought onthis.
Q: Is there any other thing you would like to say?
A: I think the time has come for the judiciary to sit down, introspect and see what can be done, because people have faith in the judiciary. A lot of that faith has been eroded in the last couple of years. So one has to restore that faith and then increase that faith. I think the judiciary definitely needs to introspect.
‘A major issue for startups, especially during fund raising, is their compliance with extant RBI foreign exchange regulations, pricing guidelines, and the Companies Act 2013.’- Aakash Parihar
Aakash Parihar is Partner at Triumvir Law, a firm specializing in M&A, PE/VC, startup advisory, international commercial arbitration, and corporate disputes. He is an alumnus of the National Law School of India University, Bangalore.
How did you come across law as a career? Tell us about what made you decide law as an option.
Growing up in a small town in Madhya Pradesh, wedid not have many options.There you either study to become a doctor or an engineer. As the sheep follows the herd, I too jumped into 11th grade with PCM (Physics, Chemistry and Mathematics).However, shortly after, I came across the Common Law Admission Test (CLAT) and the prospect of law as a career. Being a law aspirant without any background of legal field, I hardly knew anything about the legal profession leave alone the niche areas of corporate lawor dispute resolution. Thereafter, I interacted with students from various law schools in India to understand law as a career and I opted to sit for CLAT. Fortunately, my hard work paid off and I made it to the hallowed National Law School of India University, Bangalore (NSLIU). Joining NLSIU and moving to Bangalorewas an overwhelming experience. However, after a few months, I settled in and became accustomed to the rigorous academic curriculum. Needless to mention that it was an absolute pleasure to study with and from someof the brightest minds in legal academia. NLSIU, Bangalore broadened my perspective about law and provided me with a new set of lenses to comprehend the world around me. Through this newly acquired perspective and a great amount of hard work (which is of course irreplaceable), I was able to procure a job in my fourth year at law school and thus began my journey.
As a lawyer carving a niche for himself, tell us about your professional journey so far. What are the challenges that new lawyers face while starting out in the legal field?
I started my professional journey as an Associate at Samvad Partners, Bangalore, where I primarily worked in the corporate team. Prior to Samvad Partners, through my internship, I had developed an interest towards corporate law,especially the PE/VC and M&A practice area. In the initial years as an associate at Samvad Partners and later at AZB & Partners, Mumbai, I had the opportunity to work on various aspects of corporate law, i.e., from PE/VC and M&A with respect to listed as well as unlisted companies. My work experience at these firms equipped and provided me the know-how to deal with cutting edge transactional lawyering. At this point, it is important to mention that I always had aspirations to join and develop a boutique firm. While I was working at AZB, sometime around March 2019, I got a call from Anubhab, Founder of Triumvir Law, who told me about the great work Triumvir Law was doing in the start-up and emerging companies’ ecosystem in Bangalore. The ambition of the firm aligned with mine,so I took a leap of faith to move to Bangalore to join Triumvir Law.
Anyone who is a first-generation lawyer in the legal industry will agree with my statement that it is never easy to build a firm, that too so early in your career. However, that is precisely the notion that Triumvir Law wanted to disrupt. To provide quality corporate and dispute resolution advisory to clients across India and abroad at an affordable price point.
Once you start your professional journey, you need to apply everything that you learnt in law schoolwith a practical perspective. Therefore, in my opinion, in addition to learning the practical aspects of law, a young lawyer needs to be accustomed with various practices of law before choosing one specific field to practice.
India has been doing reallywell in the field of M&A and PE/VC. Since you specialize in M&A and PE/VC dealmaking, what according to you has been working well for the country in this sphere? What does the future look like?
India is a developing economy, andM&A and PE/VC transactions form the backbone of the same. Since liberalization, there has been an influx of foreign investment in India, and we have seen an exponential rise in PC/VA and M&A deals. Indian investment market growth especially M&A and PE/VC aspects can be attributed to the advent of startup culture in India. The increase in M&A and PE/VC deals require corporate lawyersto handle the legal aspects of these deals.
As a corporate lawyer working in M&A and PE/VC space, my work ranges from drafting term-sheets to the transaction documents (SPA, SSA, SHA, BTA, etc.). TheM&A and PE/VC deal space experienced a slump during the first few months of the pandemic, but since June 2021, there has been a significant growth in M&A and PE/VC deal space in India. The growth and consistence of the M&A and PE/VC deal space in India can be attributed to several factors such as foreign investment, uncapped demands in the Indian market and exceptional performance of Indian startups.
During the pandemic many businesses were shut down but surprisingly many new businesses started, which adapted to the challenges imposed by the pandemic. Since we are in the recovery mode, I think the M&A and PE/VC deal space will reach bigger heights in the comingyears. We as a firm look forward to being part of this recovery mode by being part of the more M&A and PE/VC deals in future.
You also advice start-ups. What are the legal issues or challenges that the start-ups usually face specifically in India? Do these issues/challenges have long-term consequences?
We do a considerable amount of work with startupswhich range from day-to-day legal advisory to transaction documentation during a funding round. In India, we have noticed that a sizeable amount of clientele approach counsels only when there is a default or breach, more often than not in a state of panic. The same principle applies to startups in India, they normally approach us at a stage when they are about to receive investment or are undergoing due diligence. At that point of time, we need to understand their legal issues as well as manage the demands of the investor’s legal team. The majornon-compliances by startups usually involve not maintaining proper agreements, delaying regulatory filings and secretarial compliances, and not focusing on proper corporate governance.
Another major issue for startups, especially during fund raising, is their compliance with extant RBI foreign exchange regulations, pricing guidelines, and the Companies Act 2013. Keeping up with these requirements can be time-consuming for even seasoned lawyers, and we can only imagine how difficult it would be for startups. Startups spend their initial years focusing on fund-raising, marketing, minimum viable products, and scaling their businesses. Legal advice does not usually factor in as a necessity. Our firm aims to help startups even before they get off the ground, and through their initial years of growth. We wanted to be the ones bringing in that change in the legal sector, and we hope to help many more such startups in the future.
In your opinion, are there any specific India-related problems that corporate/ commercial firms face as far as the company laws are concerned? Is there scope for improvement on this front?
The Indian legal system which corporate/commercial firms deal with is a living breathing organism, evolving each year. Due to this evolving nature, we lawyers are always on our toes.From a minor amendment to the Companies Act to the overhaul of the foreign exchange regime by the Reserve Bank of India, each of these changes affect the compliance and regulatory regime of corporates. For instance, when India changed the investment route for countries sharing land border with India,whereby any country sharing land border with India including Hong Kong cannot invest in India without approval of the RBI in consultation with the central government,it impacted a lot of ongoing transactions and we as lawyers had to be the first ones to inform our clients about such a change in the country’s foreign investment policy. In my opinion, there is huge scope of improvement in legal regime in India, I think a stable regulatory and tax regime is the need for the hour so far as the Indian system is concerned. The biggest example of such a market with stable regulatory and tax regime is Singapore, and we must work towards emulating the same.
Your boutique law firm has offices in three different cities — Delhi NCR, Mumbai and Bangalore. Have the Covid-induced restrictions such as WFH affected your firm’s operations? How has your firm adapted to the professional challenges imposed by the pandemic-related lifestyle changes?
We have offices in New Delhi NCR and Mumbai, and our main office is in Bangalore. Before the pandemic, our work schedule involved a fair bit of travelling across these cities. But post the lockdowns we shifted to a hybrid model, and unless absolutely necessary, we usually work from home.
In relation to the professional challenges during the pandemic, I think it was a difficult time for most young professionals. We do acknowledge the fact that our firm survived the pandemic. Our work as lawyers/ law firms also involves client outreach and getting new clients, which was difficult during the lockdowns. We expanded our client outreach through digital means and by conducting webinars, including one with King’s College London on International Treaty Arbitration. Further, we also focused on client outreach and knowledge management during the pandemic to educate and create legal awareness among our clients.
‘It’s a myth that good legal advice comes at prohibitive costs. A lot of heartburn can be avoided if documents are entered into with proper legal advice and with due negotiations.’ – Archana Balasubramanian
Archana Balasubramanian is the founding partner of Agama Law Associates, a Mumbai-based corporate law firm which she started in 2014. She specialises in general corporate commercial transaction and advisory as well as deep sectoral expertise across manufacturing, logistics, media, pharmaceuticals, financial services, shipping, real estate, technology, engineering, infrastructure and health.
August 13, 2021:
Lawyers see companies ill-prepared for conflict, often, in India. When large corporates take a remedial instead of mitigative approach to legal issues – an approach utterly incoherent to both their size and the compliance ecosystem in their sector – it is there where the concept of costs on legal becomes problematic. Pre-dispute management strategy is much more rationalized on the business’ pocket than the costs of going in the red on conflict and compliances.
Corporates often focus on business and let go of backend maintenance of paperwork, raising issues as and when they arise and resolving conflicts / client queries in a manner that will promote dispute avoidance.
Corporate risk and compliance management is yet another elephant in India, which in addition to commercial disputes can be a drain on a company’s resources. It can be clubbed under four major heads – labour, industrial, financial and corporate laws. There are around 20 Central Acts and then specific state-laws by which corporates are governed under these four categories.
Risk and compliance management is also significantly dependent on the sector, size, scale and nature of the business and the activities being carried out.
The woes of a large number of promoters from the ecommerce ecosystem are to do with streamlining systems to navigate legal. India has certain heavily regulated sectors and, like I mentioned earlier, an intricate web of corporate risk and compliance legislation that can result in prohibitive costs in the remedial phase. To tackle the web in the preventive or mitigative phase, start-ups end up lacking the arsenal due to sheer intimidation from legal. Promoters face sectoral risks in sectors which are heavily regulated, risks of heavy penalties and fines under company law or foreign exchange laws, if fund raise is not done in a compliant manner.
It is a myth that good legal advice comes at prohibitive costs. Promoters are quick to sign on the dotted line and approach lawyers with a tick the box approach. A lot of heartburn can be avoided if documents are entered into with proper legal advice and with due negotiations.
Investment contracts, large celebrity endorsement contracts and CXO contracts are some key areas where legal advice should be obtained. Online contracts is also emerging as an important area of concern.
When we talk of scope, arbitration is pretty much a default mechanism at this stage for adjudicating commercial disputes in India, especially given the fixation of timelines for closure of arbitration proceedings in India. The autonomy it allows the parties in dispute to pick a neutral and flexible forum for resolution is substantial. Lower courts being what they are in India, arbitration emerges as the only viable mode of dispute resolution in the Indian commercial context.
The arbitrability of disputes has evolved significantly in the last 10 years. The courts are essentially pro-arbitration when it comes to judging the arbitrability of subject matter and sending matters to arbitration quickly.
The Supreme Court’s ruling in the Vidya Drolia case has significantly clarified the position in respect of tenancy disputes, frauds and consumer disputes. It reflects upon the progressive approach of the court and aims to enable an efficient, autonomous and effective arbitration environment in India.
Law firms stand for ensuring that the law works for business and not against it. Whatever the scope of our mandate, the bottom line is to ensure a risk-free, conflict-free, compliant and prepared enterprise for our client, in a manner that does not intimidate the client or bog them down, regardless of the intricacy of the legal and regulatory web it takes to navigate to get to that end result. Lawyers need to dissect the business of law from the work.
This really involves meticulous, detail-oriented, sheer hard work on the facts, figures, dates and all other countless coordinates of each mandate, repetitively and even to a, so-called, “dull” routine rhythm – with consistent single-mindedness and unflinching resolve.
As a firm, multiply that effort into volumes, most of it against-the-clock given the compliance heavy ecosystem often riddled with uncertainties in a number of jurisdictions. So the same meticulous streamlining of mandate deliverables has to be extrapolated by the management of the firm to the junior most staff.
Further, the process of streamlining itself has to be more dynamic than ever now given the pace at which the new economy, tech-ecosystem, business climate as well as business development processes turn a new leaf.
Finally, but above all, we need to find a way to feel happy, positive and energized together as a team while chasing all of the aforesaid dreams. The competitive timelines and volumes at which a law firm works, this too is a real challenge. But we are happy to face it and evolve as we grow.
We always as a firm operated on the work from anywhere principle. We believed in it and inculcated this through document management processes to the last trainee. This helped us shut shop one day and continue from wherever we are operating.
The team has been regularly meeting online (at least once a day). We have been able to channel the time spent in travelling to and attending meetings in developing our internal knowledge banks further, streamline our processes, and work on integrating various tech to make the practice more cost-effective for our clients.
Right to Disclosure – Importance & Challenges in Criminal Justice System – By Manu Sharma
Personal liberty is the most cherished value of human life which thrives on the anvil of Articles 14 and 21 of the Constitution of India (“the Constitution”). Once a person is named an accused, he faces the spectre of deprivation of his personal liberty and criminal trial. This threat is balanced by Constitutional safeguards which mandate adherence to the rule of law by the investigating agencies as well as the Court. Thus, any procedure which seeks to impinge on personal liberty must also be fair and reasonable. The right to life and personal liberty enshrined under article 21 of the Constitution, expanded in scope post Maneka Gandhi[1], yields the right to a fair trial and fair investigation. Fairness demands disclosure of anything relevant that may be of benefit to an accused. Further, the all-pervading principles of natural justice envisage the right to a fair hearing, which entails the right to a full defence. The right to a fair defence stems from full disclosure. Therefore, the right of an accused to disclosure emanates from this Constitutional philosophy embellished by the principles of natural justice and is codified under the Code of Criminal Procedure, 1973 (“Code”).
Under English jurisprudence, the duty of disclosure is delineated in the Criminal Procedure and Investigations Act, 1996, which provides that the prosecutor must disclose to the accused any prosecution material which has not previously been disclosed to the accused and which might reasonably be considered capable of undermining the case for the prosecution against the accused or of assisting the case for the accused, except if such disclosure undermines public interest.[2] Fairness ordinarily requires that any material held by the prosecution which weakens its case or strengthens that of the defendant, if not relied on as part of its formal case against the defendant, should be disclosed to the defence.[3] The duty of disclosure under common law contemplates disclosure of anything which might assist the defence[4], even if such material was not to be used as evidence[5]. Under Indian criminal jurisprudence, which has borrowed liberally from common law, the duty of disclosure is embodied in sections 170(2), 173, 207 and 208 of the Code, which entail the forwarding of material to the Court and supply of copies thereof to the accused, subject to statutory exceptions.
II. Challenges in Enforcement
The right to disclosure is a salient feature of criminal justice, but its provenance and significance appear to be lost on the Indian criminal justice system. The woes of investigative bias and prosecutorial misconduct threaten to render this right otiose. That is not to say that the right of an accused to disclosure is indefeasible, as certain exceptions are cast in the Code itself, chief among them being public interest immunity under section 173(6). However, it is the mischief of the concept of ‘relied upon’ emerging from section 173(5) of the Code, which is wreaking havoc on the right to disclosure and is the central focus of this article. The rampant misuse of the words “on which the prosecution proposes to rely’ appearing in section 173(5) of the Code, to suppress material favourable to the accused or unfavourable to the prosecution in the garb of ‘un-relied documents’ has clogged criminal courts with avoidable litigation at the very nascent stage of supply of copies of documents under section 207 of the Code. The erosion of the right of an accused to disclosure through such subterfuge is exacerbated by the limited and restrictive validation of this right by criminal Courts. The dominant issues highlighted in the article, which stifle the right to disclosure are; tainted investigation, unscrupulous withholding of material beneficial to the accused by the prosecution, narrow interpretation by Courts of section 207 of the Code, and denial of the right to an accused to bring material on record in the pre-charge stage.
A. Tainted Investigation
Fair investigation is concomitant to the preservation of the right to fair disclosure and fair trial. It envisages collection of all material, irrespective of its inculpatory or exculpatory nature. However, investigation is often vitiated by the tendencies of overzealous investigating officers who detract from the ultimate objective of unearthing truth, with the aim of establishing guilt. Such proclivities result in collecting only incriminating material during investigation or ignoring the material favourable to the accused. This leads to suppression of material and scuttles the right of the accused to disclosure at the very inception. A tainted investigation leads to miscarriage of justice. Fortunately, the Courts are not bereft of power to supervise investigation and ensure that the right of an accused to fair disclosure remains protected. The Magistrate is conferred with wide amplitude of powers under section 156(3) of the Code to monitor investigation, and inheres all such powers which are incidental or implied to ensure proper investigation. This power can be exercised suo moto by the Magistrate at all stages of a criminal proceeding prior to the commencement of trial, so that an innocent person is not wrongly arraigned or a prima facie guilty person is not left out.[6]
B. Suppression of Material
Indian courts commonly witness that the prosecution is partisan while conducting the trial and is invariably driven by the lust for concluding in conviction. Such predisposition impels the prosecution to take advantage by selectively picking up words from the Code and excluding material favouring the accused or negating the prosecution case, with the aid of the concept of ‘relied upon’ within section 173(5) of the Code. However, the power of the prosecution to withhold material is not unbridled as the Constitutional mandate and statutory rights given to an accused place an implied obligation on the prosecution to make fair disclosure.[7] If the prosecution withholds vital evidence from the Court, it is liable to adverse inference flowing from section 114 of the Indian Evidence Act, 1872 (“Evidence Act). The prosecutor is expected to be guided by the Bar Council of India Rules which prescribe that an advocate appearing for the prosecution of a criminal trial shall so conduct the prosecution that it does not lead to conviction of the innocent. The suppression of material capable of establishment of the innocence of the accused shall be scrupulously avoided. [8]
C. Scope of S. 207
The scope of disclosure under section 207 has been the subject of fierce challenge in Indian Courts on account of the prosecution selectively supplying documents under the garb of ‘relied upon’ documents, to the prejudice of the defence of an accused. The earlier judicial trend had been to limit the supply of documents under section 207 of the Code to only those documents which were proposed to be relied upon by the prosecution. This view acquiesced the exclusion of documents which were seized during investigation, but not filed before the Court along with the charge sheet, rendering the right to disclosure a farce. This restrictive sweep fails to reconcile with the objective of a fair trial viz. discovery of truth. The scheme of the code discloses that Courts have been vested with extensive powers inter alia under sections 91, 156(3) and 311 to elicit the truth. Towards the same end, Courts are also empowered under Section 165 of the Evidence Act. Thus, the principle of harmonious construction warrants a more purposive interpretation of section 207 of the code. The Hon’ble Supreme Court expounded on the scope of Section 207 of the Code in the case of Manu Sharma[9] and held that documents submitted to the Magistrate under section 173(5) would deem to include the documents which have to be sent to the magistrate during the course of investigation under section 170(2). A document which has been obtained bona fide and has a bearing on the case of the prosecution should be disclosed to the accused and furnished to him to enable him to prepare a fair defence, particularly when non production or disclosure would affect administration of justice or prejudice the defence of the accused. It is not for the prosecution or the court to comprehend the prejudice that is likely to be caused to the accused. The perception of prejudice is for the accused to develop on reasonable basis.[10] Manu Sharma’s [supra] case has been relied upon in Sasikala [11] wherein it was held that the Court must concede a right to the accused to have access to the documents which were forwarded to the Court but not exhibited by the prosecution as they favoured the accused. These judgments seem more in consonance with the true spirit of fair disclosure and fair trial. However, despite such clear statements of law, courts are grappling with the judicial propensity of deviating from this expansive interpretation and regressing to the concept of relied upon. The same is evident from a recent pronouncement of the Delhi High Court where the ratios laid down in Manu Sharma & Sasikala [supra] were not followed by erroneously distinguishing from those cases.[12] Such “per incuriam” aberrations by High Court not only undermine the supremacy of the Apex Court, but also adversely impact the functioning of the district courts over which they exercise supervisory jurisdiction. Hopefully in future Judges shall be more circumspect and strictly follow the law declared by the Apex Court.
D. Pre-Charge Embargo
Another obstacle encountered in the enforcement of the right to disclosure is the earlier judicial approach to stave off production or consideration of any additional documents not filed alongwith the charge sheet at the pre-charge stage, as the right to file such material was available to the accused only upon the commencement of trial after framing of charge.[13] At the pre-charge stage, Court could not direct the prosecution to furnish copies of other documents[14] It was for the accused to do so during trial or at the time of entering his defence. However, the evolution of law has seen that at the stage of framing charge, Courts can rely upon the material which has been withheld by the prosecutor, even if such material is not part of the charge sheet, but is of such sterling quality demolishing the case of the prosecution.[15] Courts are not handicapped to consider relevant material at the stage of framing charge, which is not relied upon by the prosecution. It is no argument that the accused can ask for the documents withheld at the time of entering his defence.[16] The framing of charge is a serious matter in a criminal trial as it ordains an accused to face a long and arduous trial affecting his liberty. Therefore, the Court must have all relevant material before the stage of framing charge to ascertain if grave suspicion is made out or not. Full disclosure at the stage of section 207 of the code, which immediately precedes discharging or charging an accused, enables an accused to seek a discharge, if the documents, including those not relied upon by the prosecution, create an equally possible view in favour of the accused.[17] On the other hand, delaying the reception of documents postpones the vindication of the accused in an unworthy trial and causes injustice by subjecting him to the trauma of trial. There is no gainsaying that justice delayed is justice denied, therefore, such an approach ought not to receive judicial consent. A timely discharge also travels a long way in saving precious time of the judiciary, which is already overburdened by the burgeoning pendency of cases. Thus, delayed or piecemeal disclosure not only prejudices the defence of the accused, but also protracts the trial and occasions travesty of justice.
III. Duties of the stakeholders in criminal justice system
The foregoing analysis reveals that participation of the investigating agency, the prosecution and the Court is inextricably linked to the enforcement of the right to disclosure. The duties cast on these three stakeholders in the criminal justice system, are critical to the protection of this right. It is incumbent upon the investigating agencies to investigate cases fairly and to place on record all the material irrespective of its implication on the case of prosecution case. Investigation must be carried out with equal alacrity and fairness irrespective of status of accused or complainant.[18] An onerous duty is cast on the prosecution as an independent statutory officer, to conduct the trial with the objective of determination of truth and to ensure that material favourable to the defence is supplied to the accused. Ultimately, it is the overarching duty of the Court to ensure a fair trial towards the administration of justice for all parties. The principles of fair trial require the Court to strike a delicate balance between competing interests in a system of adversarial advocacy. Therefore, the court ought to exercise its power under section 156(3) of the Code to monitor investigation and ensure that all material, including that which enures to the benefit of the accused, is brought on record. Even at the stage of supply of copies of police report and documents under section 207 of the Code, it is the duty of the Court to give effect to the law laid down by the Hon’ble Supreme Court in Manu Sharma (supra) and Sasikala (supra), and ensure that all such material is supplied to the accused irrespective of whether it is “relied upon” by the prosecution or not.
IV. Alternate Remedy
The conundrum of supply of copies under section 207 of the code abounds criminal trials. Fairness is an evolving concept. There is no doubt that disclosure of all material which goes to establish the innocence of an accused is the sine qua non of a fair trial.[19] Effort is evidently underway to expand the concept in alignment with English jurisprudence. In the meanwhile, does the right of an accused to disclosure have another limb to stand on? Section 91 of the Code comes to the rescue of an accused, which confers wide discretionary powers on the Court, independent of section 173 of the Code, to summon the production of things or documents, relevant for the just adjudication of the case. In case the Court is of the opinion that the prosecution has withheld vital, relevant and admissible evidence from the Court, it can legitimately use its power under section 91 of the Code to discover the truth and to do complete justice to the accused.[20]
V. Conclusion
A society’s progress and advancement are judged on many parameters, an important one among them being the manner in which it administers criminal justice. Conversely, the ironic sacrilege of the core virtues of criminal jurisprudence in the temples of justice evinces social decadence. The Indian legislature of the twenty first century has given birth to several draconian statutes which place iron shackles on personal liberty, evoking widespread fear of police abuses and malicious prosecution. These statutes not only entail presumptions which reverse the burden of proof, but also include impediments to the grant of bail. Thus, a very heavy burden to dislodge the prosecution case is imposed on the accused, rendering the right to disclosure of paramount importance. It is the duty of the Court to keep vigil over this Constitutional and statutory right conferred on an accused by repudiating any procedure which prejudices his defence. Notable advancement has been made by the Apex Court in interpreting section 207 of the Code in conformity with the Constitutional mandate, including the right to disclosure. Strict adherence to the afore-noted principles will go a long way in ensuring real and substantial justice. Any departure will not only lead to judicial anarchy, but also further diminish the already dwindling faith of the public in the justice delivery system.
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Advocate Manu Sharma has been practising at the bar for over sixteen years. He specialises in Criminal Defence. Some of the high profile cases he has represented are – the 2G scam case for former Union minister A Raja; the Religare/Fortis case for Malvinder Singh; Peter Mukerjee in the P Chidambaram/ INX Media case; Devas Multimedia in ISRO corruption act case; Om Prakash Chautala in PMLA case; Aditya Talwar in the aviation scam case; Dilip Ray, former Coal Minister in one of the coal scam cases; Suhaib Illyasi case.
**
Disclaimer: The views or opinions expressed are solely of the author.
[1] Maneka Gandhi and Another v. Union of India, (1978) 1 SCC 248
[2] S. 3 of the Criminal Procedure and Investigations Act, 1996
[3] R v. H and R v. C, 2004 (1) ALL ER 1269
[4] R v. Ward (Judith), (1993) 1 WLR 619 : (1993) 2 ALL ER 577 (CA)
[5] R v. Preston, (1994) 2 AC 130 : (1993) 3 WLR 891 : (1993) 4 ALL ER 638 (HL), R v. Stinchcome,
(1991), 68 C.C.C. (3d) 1 (S.C.C.)
[6] Vinubhai Haribhai Malaviya and Others v. State of Gujarat and Another, 2019 SCC Online SC 1346
[7] Sidhartha Vashishth alias Manu Sharma v. State (NCT of Delhi), (2010) 6 SCC 1
[8] R. 16, part II, Ch. VI of the Bar Council of India Rules
[9] Manu Sharma, (2010) 6 SCC 1
[10] V.K. Sasikala v. State, (2012) 9 SCC 771 : AIR 2013 SC 613
[11] Sasikala, (2012) 9 SCC 771 : AIR 2013 SC 613
[12] Sala Gupta and Another v. Directorate of Enforcement, (2019) 262 DLT 661
[13] State of Orissa v. Debendra Nath Padhi¸(2005) 1 SCC 568
[14] Dharambir v. Central Bureau of Investigation, ILR (2008) 2 Del 842 : (2008) 148 DLT 289
[15] Nitya Dharmananda alias K. Lenin and Another v. Gopal Sheelum Reddy, (2018) 2 SCC 93
[16] Neelesh Jain v. State of Rajasthan, 2006 Cri LJ 2151
[17] Dilwar Balu Kurane v. State of Maharashtra, (2002) 2 SCC 135, Yogesh alias Sachin Jagdish Joshi v. State of Maharashtra, (2008) 10 SCC 394
[18] Karan Singh v. State of Haryana, (2013) 12 SCC 529
[19] Kanwar Jagat Singh v. Directorate of Enforcement & Anr, (2007) 142 DLT 49
[20] Neelesh, 2006 Cri LJ 2151
Disclaimer: The views or opinions expressed are solely of the author.
Validity & Existence of an Arbitration Clause in an Unstamped Agreement
By Kunal Kumar
January 8, 2024
In a recent ruling, a seven-judge bench of the Supreme Court of India in its judgment in re: Interplay between arbitration agreements under the Arbitration & Conciliation Act 1996 and the Indian Stamp Act 1899, overruled the constitutional bench decision of the Supreme Court of India in N. N. Mercantile Private Limited v. Indo Unique Flame Ltd. & Ors. and has settled the issue concerning the validity and existence of an arbitration clause in an unstamped agreement. (‘N. N. Global Mercantile (P) Ltd. v. Indo Unique Flame Ltd. – III’)
Background to N. N. Global Mercantile (P) Ltd. v. Indo Unique Flame Ltd. – III
One of the first instances concerning the issue of the validity of an unstamped agreement arose in the case of SMS Tea Estate Pvt. Ltd. v. Chandmari Tea Company Pvt. Ltd. In this case, the Hon’ble Apex Court held that if an instrument/document lacks proper stamping, the exercising Court must preclude itself from acting upon it, including the arbitration clause. It further emphasized that it is imperative for the Court to impound such documents/instruments and must accordingly adhere to the prescribed procedure outlined in the Indian Stamp Act 1899.
With the introduction of the 2015 Amendment, Section 11(6A) was inserted in the Arbitration & Conciliation Act 1996 (A&C Act) which stated whilst appointing an arbitrator under the A&C Act, the Court must confine itself to the examination of the existence of an arbitration agreement.
In the case of M/s Duro Felguera S.A. v. M/s Gangavaram Port Limited, the Supreme Court of India made a noteworthy observation, affirming that the legislative intent behind the 2015 Amendment to the A&C Act was necessitated to minimise the Court's involvement during the stage of appointing an arbitrator and that the purpose embodied in Section 11(6A) of A&C Act, deserves due acknowledgement & respect.
In the case of Garware Wall Ropes Ltd. v. Cosatal Marine Constructions & Engineering Ltd., a divisional bench of the Apex Court reaffirmed its previous decision held in SMS Tea Estates (supra) and concluded that the inclusion of an arbitration clause in a contract assumes significance, emphasizing that the agreement transforms into a contract only when it holds legal enforceability. The Apex Court observed that an agreement fails to attain the status of a contract and would not be legally enforceable unless it bears the requisite stamp as mandated under the Indian Stamp Act 1899. Accordingly, the Court concluded that Section 11(6A) read in conjunction with Section 7(2) of the A&C Act and Section 2(h) of the Indian Contract Act 1872, clarified that the existence of an arbitration clause within an agreement is contingent on its legal enforceability and that the 2015 Amendment of the A&C Act to Section 11(6A) had not altered the principles laid out in SMS Tea Estates (supra).
Brief Factual Matrix – N. N. Global Mercantile (P) Ltd. v. Indo Unique Flame Ltd.
Indo Unique Flame Ltd. (‘Indo Unique’) was awarded a contract for a coal beneficiation/washing project with Karnataka Power Corporation Ltd. (‘KPCL’). In the course of the project, Indo Unique entered into a subcontract in the form of a Work Order with N.N. Global Mercantile Pvt. Ltd. (‘N.N. Global’) for coal transportation, coal handling and loading. Subsequently, certain disputes arose with KPCL, leading to KPCL invoking Bank Guarantees of Indo Unique under the main contract, after which Indo Unique invoked the Bank Guarantee of N. N. Global as supplied under the Work Order.
Top of FormS
Subsequently, N.N. Global initiated legal proceedings against the cashing of the Bank Guarantee in a Commercial Court. In response thereto, Indo Unique moved an application under Section 8 of the A&C Act, requesting that the Parties to the dispute be referred for arbitration. The Commercial Court dismissed the Section 8 application, citing the unstamped status of the Work Order as one of the grounds. Dissatisfied with the Commercial Court's decision on 18 January 2018, Indo Unique filed a Writ Petition before the High Court of Bombay seeking that the Order passed by the Commercial Court be quashed or set aside. The Hon’ble Bombay High Court on 30 September 2020 allowed the Writ Petition filed by Indo Unique, aggrieved by which, N.N. Global filed a Special Leave Petition before the Supreme Court of India.
N. N. Global Mercantile Pvt. Ltd. v. Indo Unique Flame Ltd. – I
The issue in the matter of M/s N.N. Global Mercantile Pvt. Ltd. v. M/s Indo Unqiue Flame Ltd. & Ors. came up before a three-bench of the Supreme Court of India i.e. in a situation when an underlying contract is not stamped or is insufficiently stamped, as required under the Indian Stamp Act 1899, would that also render the arbitration clause as non-existent and/or unenforceable (‘N.N. Global Mercantile Pvt. Ltd. v. Indo Flame Ltd. – I’).
The Hon’ble Supreme Court of India whilst emphasizing the 'Doctrine of Separability' of an arbitration agreement held that the non-payment of stamp duty on the commercial contract would not invalidate, vitiate, or render the arbitration clause as unenforceable, because the arbitration agreement is considered an independent contract from the main contract, and the existence and/or validity of an arbitration clause is not conditional on the stamping of a contract. The Hon’ble Supreme Court further held that deficiency in stamp duty of a contract is a curable defect and that the deficiency in stamp duty on the work order, would not affect the validity and/or enforceability of the arbitration clause, thus applying the Doctrine of Separability. The arbitration agreement remains valid and enforceable even if the main contract, within which it is embedded, is not admissible in evidence owing to lack of stamping.
The Hon’ble Apex Court, however, considered it appropriate to refer the issue i.e. whether unstamped instrument/document, would also render an arbitration clause as non-existent, unenforceable, to a constitutional bench of five-bench of the Supreme Court.
N. N. Global Mercantile (P) Ltd. v. Indo Unique Flame Ltd. – II
On 25 April 2023, a five-judge bench of the Hon’ble Supreme Court of India in the matter of N. N. Mercantile Private Limited v. Indo Unique Flame Ltd. & Ors. held that (1) An unstamped instrument containing an arbitration agreement cannot be said to be a contract which is enforceable in law within the meaning of Section 2(h) of the Indian Contract Act 1872 and would be void under Section 2(g) of the Indian Contract Act 1872, (2) an unstamped instrument which is not a contract nor enforceable cannot be acted upon unless it is duly stamped, and would not otherwise exist in the eyes of the law, (3) the certified copy of the arbitration agreement produced before a Court, must clearly indicate the stamp duty paid on the instrument, (4) the Court exercising its power in appointing an arbitration under Section 11 of the A&C Act, is required to act in terms of Section 33 and Section 35 of the Indian Stamp Act 1899 (N. N. Global Mercantile (P) Ltd. v. Indo Unique Flame Ltd. – II).
N. N. Global Mercantile (P) Ltd. v. Indo Unique Flame Ltd. – III
A seven-judge bench of the Supreme Court of India on 13 December 2023 in its recent judgment in re: Interplay between arbitration agreements under the Arbitration & Conciliation Act 1996 and the Indian Stamp Act 1899, (1) Agreements lacking proper stamping or inadequately stamped are deemed inadmissible as evidence under Section 35 of the Stamp Act. However, such agreements are not automatically rendered void or unenforceable ab initio; (2) non-stamping or insufficient stamping of a contract is a curable defect, (2) the issue of stamping is not subject to determination under Sections 8 or 11 of the A&C Act by a Court. The concerned Court is only required to assess the prima facie existence of the arbitration agreement, separate from concerns related to stamping, and (3) any objections pertaining to the stamping of the agreement would fall within the jurisdiction of the arbitral tribunal. Accordingly, the decision in N. N. Global Mercantile (P) Ltd. v. Indo Unique Flame Ltd. – II and SMS Tea (supra) was overruled, by the seven-judge bench of the Supreme Court of India.
Kunal is a qualified lawyer with more than nine years of experience and has completed his LL.M. in Dispute Resolution (specialisation in International Commercial Arbitration) from Straus Institute for Dispute Resolution, Pepperdine University, California.
Kunal currently has his own independent practice and specializes in commercial/construction arbitration as well as civil litigation. He has handled several matters relating to Civil Law and arbitrations (both domestic and international) and has appeared before the Supreme Court of India, High Court of Delhi, District Courts of Delhi and various other tribunals.
No Safe Harbour For Google On Trademark Infringement
By Mayank Grover & Pratibha Vyas
October 9, 2023
Innovation, patience, dedication and uniqueness culminate in establishing a distinct identity. A trademark aids in identifying the source and quality, shaping perceptions about the identity's essence. When values accompany a product or service's trademark, safeguarding against misuse and infringement becomes crucial. A recent pronouncement of a Division Bench of the Delhi High Court dated August 10, 2023 in Google LLC v. DRS Logistics (P) Ltd. & Ors. and Google India Private Limited v. DRS Logistics (P) Ltd. & Ors. directed that Google’s use of trademarks as keywords for its Google Ads Programme does amount to ‘use’ in advertising under the Trademarks Act and the benefit of safe harbour would not be available to Google if such keywords infringe on the concerned trademark.
Factual Background
Google LLC manages and operates the Google Search Engine and Ads Programme, while, Google India Private Limited is a subsidiary of Google that has been appointed as a non-exclusive reseller of the Ads Programme in India. The Respondents, DRS Logistics and Agarwal Packers and Movers Pvt. Ltd. are leading packaging, moving and logistics service providers in India.
On 22.12.2011, DRS filed a suit against Google and Just Dial Ltd. under provisions of the Trademarks Act, 1999 (‘TM Act’) inter alia seeking a permanent injunction against Google from permitting third parties from infringing, passing off etc. the relevant trademarks of DRS. The core of the dispute revolved around Google’s Ads Programme. DRS claimed that its trade name 'AGARWAL PACKERS AND MOVERS' is widely recognized and a 'well-known' trademark. Use of DRS’s trademark as a keyword diverts internet traffic from its website to that of its competitors and they were entitled to seek restraint against Google for permitting third parties who are not authorized to use the said trademark. DRS further argued that Google benefits from these trademark infringements. This practice involved charging a higher amount for displaying these ads, constituting an infringement of their trademarks. Whereas, Google contended that the use of the keyword in the Ads Programme does not amount to ‘use’ under the TM Act notwithstanding that the keyword is/or similar to a trademark. Thus, the use of a term as a keyword cannot be construed as an infringement of a trademark under the TM Act, and being an intermediary, it claimed a safe harbour under Section 79 of the Information Technology Act, 2000. (‘IT Act’).
In essence, the dispute between the parties was rooted in DRS’s grievance concerning the Ads Programme. The Learned Single Judge vide judgment dated 30.10.2021interpreted relevant provisions of the TM Act and drew on multiple legal precedents to arrive at the decision that DRS can seek protection of its trademarks which were registered under Section 28 of the TM Act and issued directions to investigate complaints alleging the use of trademark and/or to ascertain whether a sponsored result has an effect of infringing a trademark or passing off.
Being aggrieved, Google LLC and Google Pvt. Ltd. filed appeals before the Division Bench. Google LLC argued that the Single Judge’s findings were erroneous and the directions issued were liable to be set aside. Google India claimed that it doesn’t control and operate the Search Engine and the Ads Programme making it unable to comply with the directions passed in the impugned judgment.
Analysis & Decision of Court
The Division Bench found Single Judge’s rationale for assessing trademark infringement through keywords and meta-tags valid. Meta-tags are a list of words/code in a website, not readily visible to the naked eye. It serves as a tool for indexing the website by a search engine. If a trademark of a third party is used as a meta-tag, the same would serve as identifying the website as relevant to the search query that includes the trademark as a search term. The use of keywords in the Ads Programme also serves similar purpose. The Division Bench was unable to accept that using a trademark as a keyword, even if not visible, would not be considered trademark use under the TM Act.
Google placed heavy reliance on the decisions rendered by Courts across jurisdictions of United Kingdom, United States of America, European Union, Australia, New Zealand, Russia, South Africa, Canada, Spain, Italy, Japan and China; in the cases of Google France SARL and Google Inc. v. Louis Vitton SA & Ors.[1], Interflora Inc. v. Marks & Spencer Plc.[2], and L’Oreal SA v. eBay International AG[3] in support of the contention that the use of trade marks is by the advertiser and not by Google. However, the Division Bench rejected Google’s passive role; highlighting its active involvement in recommending and promoting trademark keywords for higher clicks in its Ads Programme. Division Bench referred to a few judicial decisions rendered in the United States of America that captured the essence of the controversy for perspective, concluding that Google actively promotes and encourages trademarks associated with major goods and services, rather than having a passive role.
It was held that the contention that the use of trademarks as keywords, per se constitutes an infringement of the trademark is unmerited; the assumption that an internet user is merely searching the address of the proprietor of the trademark when he feeds in a search query that may contain a trademark, is erroneous.
The Doctrine of 'Initial Interest Confusion' addresses trademark infringement based on pre-purchase confusion. The doctrine is applied when meta-tags, keywords, or domain names cause initial confusion similar to a registered trademark. If users are misled to access unrelated websites, trademark use in internet advertising may be actionable and reliance was placed on US precedents. Referring to Section 29 of the TM Act, it was directed that Section 29 does not specify the duration for which the confusion lasts but, even if the confusion is for a short duration and an internet user is able to recover from the same, the trade mark would be infringed and would offend Section 29(2) of the TM Act.
It was held that the Ads Programme is a platform for displaying advertisements. Google, being an architect and operator of its own programme makes it an active participant in the use of trademarks and determining the advertisements displayed on search pages. Their use of proprietary software makes them utilize trademarks and control the distribution of information related to potentially infringing links, ultimately leading to revenue maximization. Hence, a substantial link exists between Google LLC and Google India, rendering it impossible for Google India to deny its role in operating the Ads Programme. It was further held that Google sells trademarks as keywords to advertisers and encourages users to use trademarks as keywords for ads. It is contradictory for Google to encourage trademark use while claiming data belongs to third parties for exemption. After 2004, Google changed policies to boost revenue and subsequently, introduced a tool that searches effective terms, including trademarks. Google's active involvement in its advertising business and online nature does not necessarily qualify it for benefits under Section 79 of the IT Act. The Division Bench agreed with the view of the Single Judge that Google would not be eligible for protection of safe harbour under Section 79(1) of the IT Act, if its alleged activities infringe trademarks.
Conclusion
This is a seminal decision governing (and rather, restricting) the operations of intermediaries and redefining the jurisprudence of safe harbour under the IT Act. The decision is well-reasoned and establishes a significant precedent for safeguarding trademarks by uniquely holding Google accountable under its Ads Programme. The same will prevent usage of tradenames as a third-party trademark in keyword search or metatags by advertisers on Google’s search engine. While keywords and meta-tags have different levels of visibility, their purpose is similar i.e. advertising and attracting internet traffic. The use of trademarks as meta-tags by a person who is neither a proprietor of the trademark nor permitted to use the same leads to confusion amongst public at large due to the automated processes of search engines and consequently, constitutes trademark infringement.
About the Authors: Mayank Grover is a Partner and Pratibha Vyas is an Associate at Seraphic Advisors, Advocates & Solicitors
[1] C-236/08 to C-238/08 (2010) [2011] All ER (EC) 41
[2] [2014] EWCA Civ 1403
[3] 2C- 324/09 (2010)
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