Read Order: Prakash Nishad @ Kewat Zinak Nishad v State of Maharashtra
Simran Singh
New Delhi, May 20, 2023: In a criminal appeal, the Supreme Court has set aside the impugned judgement convicting the appellant under Sections 376, 377, 302 and 201 of the Indian Penal Code, 1860 which had sentenced him to death for the murder of a six-year-old, after committing which he had thrown her body in a drain in an attempt to destroy evidence, and life sentence for sexual assault on the child.
“The charges mentioned above, although serious and grievous in nature, could not be said to have been met against the present appellant. The factum of the commission of the crime against the six-year-old innocent child is not in dispute and cannot be deprecated enough even in the most severe terms. However, the circumstances forming the chain of commission of this crime could not and do not point conclusively to the appellant in a manner that he may be punished for the same much less, with the sentence of being put to death.”
In the matter at hand, a child of the tender age of six was assaulted brutally and killed. The appellant was arrested on suspicion of having committed the crime. Pursuant to the First Information Report dated 12-06-2010 registered in Thane, Mumbai, the appellant was charged for having committed an offence punishable under Sections 376, 377, 302 and 201 of the Indian Penal Code, 1860 . The Trial Court vide judgment dated 27-11-2014, convicted the accused in connection with all the offences and imposed capital punishment for the charge under Section 302 of IPC and sentence of imprisonment for other offences. Such findings of fact and conviction, including that of the death sentence imposed were affirmed by the Bombay High Court, hence the present appeal.
The Top Court questioned the fact as to why was Section 53A of Code of Criminal Procedure, 1973 was not complied with? In view of the Court, this was a glaring lapse in the investigation of the crime, for a six- year-old child who was sexually assaulted, on both of the private parts of her body and the timely medical examination of the appellant would have resulted into ascertainment of such assault.
The Court observed that there was no clarity of who took the samples of the appellant and the record revealed that one set of sample taken on 14-06-2010 was sent for chemical analysis on 16-06-2010 and the second sample taken, a month later on 20-07-2010 was sent the very same day. The Court questioned why these differing degrees of promptitude in respect of similar, if not the same- natured scientific evidence existed which remained unexplained. The delay in sending the samples was unexplained and therefore, the possibility of contamination and the concomitant prospect of diminishment in value could not be ruled out.
Further, the Bench stated that the chain of custody should have been maintained, which implied that right from the time of taking of the sample, to the time its role in the investigation and processes subsequent, was complete, each person handling said piece of evidence must duly be acknowledged in the documentation, so as to ensure that the integrity was un-compromised. It was recommended that a document be duly maintained cataloguing the custody.
The Bench stated that ‘without any delay’ and ‘chain of custody’ aspects which were indispensable to the vitality of such evidence, were not complied with thus, the Court could not hold the DNA Report to be dependable so as to send someone to the gallows on this basis.
“Even though the DNA evidence by way of a report was present, its reliability was not infallible, especially not so in light of the fact that the un compromised nature of such evidence could not be established was absent almost in its entirety.”
The Bench was of the view that the Courts below unfortunately did not go into all the necessary aspects and presumptuously assumed the guilt of the appellant and held him to have committed the crime.
The Bench perused the material on record and stated that the appellant did not know how to read and write in Marathi which highlighted the importance of the appellant being able to understand the case of the prosecution against him. Inability to do so, by virtue of a language barrier causes prejudice to the case of the appellant.
The Bench noted that it was on the basis of the post-mortem and, ‘the clinching medical evidence’ and ‘clinching DNA report that the Courts, without recording any findings with regard to the circumstances being unrefuted, convicted the appellant despite there being contradictions, material in nature, belying the prosecution case and the veracity of the statement of witnesses, so also impeaching their credibility. Further, what weighed with the Courts below was more so evident from the findings returned by the High Court, i.e., nature of the alleged crime being indeed one of the heart-breaking, horrific and most depraved kind, prompting the confirmation of the death sentence awarded by the Trial Court, considering the case to be the rarest of rare.
“It is true that the unfortunate incident did take place, and the prosecutrix sustained multiple injuries on her body and surely must have suffered great pain, agony, and trauma. At the tender age of 6, a life for which much was in store in the future was terrifyingly destroyed and extinguished. The parents of the prosecutrix suffered an unfathomable loss; a wound for which there is no remedy.”
The Court was of the view that despite such painful relies being part of this case, it could not hold within law, the prosecution to have undergone all necessary lengths and efforts to take the steps necessary for driving home the guilt of the appellant and that of none else in the crime.
“There are, in fact, yawning gaps in the chain of circumstances rendering it far from being established- pointing to the guilt of the appellant.”
The Bench was of the view that there were several irregularities and illegalities on the part of the agencies examining the case with numerous lapses blotting the entire map with the larger picture emerging therefrom being that the person, whomsoever they may have been, remains unpunished to this day.
The Court stated that both the crimes committed against the innocent six-year-old child, were unquestionably, malum in se i.e., evil and wrong on their own, without the prohibition of law making it so. This fact, coupled with the duty upon the investigating authorities not only to protect the citizens of the country, but also ensure fair and proper investigations into crimes affecting the society, as in the present case, casts upon such authorities, in the considered view of this Court, not only legal, but also a moral duty to take all possible steps within the letter of the law to bring the doers of such acts to the book.
The Bench was surprised to note as to why the investigation officers were changed time and again which remained unexplained. Further, there was no reason for having to decide why there was no need to comply with the provision of Section 53A of CrPC; there was unexplained delay in sending the samples collected for analysis; a premise already searched was searched again, the reason for which was not borne from record; lock panchnama was not prepared; no samples of blood and semen of the appellant could be said to have been drawn by any medical or para medical staff; allegedly an additional sample was taken from the appellant more than a month after the arrest; alleged disclosure statement of the appellant was never read over and explained to the appellant in his vernacular language; the appellant was not residing alone at the place alleged to be his residence; and what was the basis of appellant being a suspect at the first instance, remains a mystery, such multitudinous lapses have compromised the quest to punish the doer of such a barbaric act in absolute peril.
The Court referred to the case of Maghavendra Pratap Singh @Pankaj Singh v. State of Chattisgarh and emphasised the role and responsibilities of the investigating authorities by referring to various judgments of this Court. Such principles, which were essential to successful investigations, were not adhered to. “Needless to state, such responsibilities would be all the more heightened in cases of crimes involving severe punishments such as imprisonment for life or the sentence of death. Considering the nature of the case, the police ought to have, even more than usual, taken steps, precautions, and decisions to safeguard the fact- finding and investigation exercise.”
In the view thereof, it was held that the charges levied on the appellant stand not proved and the appeal was allowed. Accordingly the impugned judgement, convicting the appellant under Sections 302, 376, 377 and 201 IPC and sentencing him to death and life imprisonment was quashed and set aside.
Read Order: Sidda Venkata Surya Prakasa Rao v. Asst. Commissioner of Income Tax
Chahat Varma
New Delhi, May 20, 2023: The Hyderabad bench of the Income Tax Appellate Tribunal has declared an order dated 23.03.2020 as invalid due to the absence of the Document Identification Number (DIN).
In the present case, the appeal challenged the legal validity of the order dated 23.03.2020, passed by the learned Principal Commissioner of Income Tax (PCIT) under section 263 of the Income Tax Act. The Revenue argued that the impugned order had a document number, indicating that there was no violation of the Circular No. 19/2019, dated 14.08.2019. The Revenue further contended that even if there was a discrepancy in the DIN, a meritorious case cannot be thrown out without delving into the merits of the same.
The Tribunal noted that there was no denial of the fact that nowhere in the order dated 23.03.2020, there was any whisper about the generation or non-generation of DIN nor was there any reference to the reasons for not generating any computer-based DIN at the time of passing of such order. It was only by way of subsequent communication, that it was communicated to the assessee that the order dated 23.03.2020 was having a DIN number.
The Tribunal noted that as per the CBDT Circular, all communication, including orders, issued from 01.10.2019 onwards should contain the computer-generated DIN. In the absence of the DIN, as stated in paragraph 4 of the Circular, the communication was deemed to have never been issued. The Tribunal acknowledged that paragraph 3 of the Circular provided exceptions in five specific circumstances.
Reliance was also placed on CIT vs. Brandix Mauritius Holdings Ltd. [LQ/DelHC/2023/2729], wherein the Delhi High Court has concluded that any communication related to assessments, appeals, orders, etc., as mentioned in paragraph 2 of the 2019 circular, without the DIN, would have no legal standing considering the provisions of paragraph 4 of the 2019 circular.
The Tribunal observed that in the order passed under section 263 of the Income Tax Act, neither the reasons nor the statement in the prescribed format were found, specifying the particular category of exception that prevented the allotment of the DIN on that day. This was considered as another violation of the provisions by the Tribunal.
Read Judgment:ARTI DIXIT & ANR Vs. SUSHIL KUMAR MISHRA & ORS
Tulip Kanth
New Delhi, May 20, 2023: The Supreme Court has clarified that when an ex-parte Decree is passed under the proviso to Section 17 of the Provincial Small Cause Courts Act, an applicant filing the Application to set aside the Decree has to deposit due amount or give security for performance of Decree ‘on a previous Application’ made by him in this behalf.
“The appellants had filed an Application under Order IX Rule 13 of the CPC and Section 17 of the Act, on the same day. If the Application under Section 17 was accompanied with a cash deposit, then, the Application under Order IX Rule 13 would have been, indeed, maintainable”, the Division Bench of Justice K.M. Joseph and Justice Hrishikesh Roy asserted.
In this case, the respondents obtained an ex-parte decree for ejectment and recovery of arrears of rent, taxes, damages against the appellants. The appellants filed an application under Order IX Rule 13 read with Section 151 of the Code of Civil Procedure on May 6, 2014 claiming knowledge of the Decree on execution proceeding It was numbered as 4C and on the very same day, an application was filed under Section 17 of the Provincial Small Cause Courts Act 1887.
The applicants prayed in this application to grant the permission for depositing/ paying the balance amount and furnish the surety of a sum of Rs 50,000.This Application came to be numbered as 8C. Subsequently, an Application was filed with a prayer that the security in the form of a rental shop owned by the Nagar Nigam may be taken on record and the same was allowed.
This was the Application numbered as 14C. Later, the Trial Court dismissed Application 8C filed under Section 17. This Order was challenged by the appellants by filing a Revision and the High Court ordered an expeditious disposal of the case.
The Trial Court rejected the application under Section 17 as well as the surety provided by the appellants. This order was confirmed by the ADJ in revision filed by the appellants. The appellant’s plea before the High Court was also rejected.
It was the case of the appellants, before the Top Court, that they had moved the Application under Order IX Rule 13 of the CPC as well as the Application under Section 17 on the same day and this was validly filed in terms of the Judgment of the Apex Court in Kedarnath v. Mohan Lal Kesarwari and others.
In Kedarnath Case (Supra) it was held that the obligation of the applicant is to move a previous application for dispensation. It is then for the court to make a prompt order. The delay on the part of the court in passing an appropriate order would not be held against the applicant because none can be made to suffer for the fault of the court.
The Bench clarified, “When a Decree is passed by a Court of Small Causes ex-parte, inter alia, under the proviso to Section 17 of the Act, the applicant, who files an Application to set aside the ex-parte Decree is bound to do the following:
a. He must deposit in the Court, the amount due under the Decree;
b. In the alternative, he should give security for the performance of the Decree ‘on a previous Application’ made by him in this behalf;”
Noting that in view of the Judgment in Kedarnath (supra), the words ‘on a previous application’ in proviso to Section 17, have been understood to be an application, which may be made along with the application under Order IX Rule 13 of the CPC, the Bench observed that if the Application under Section 17 was accompanied with a cash deposit, then, the Application under Order IX Rule 13 would have been, indeed, maintainable.
It was noticed that the applicant didnot furnish any security and thus did not seek for dispensing with deposit as such.Therefore, the appellant had not in the said sense complied with the mandatory requirement of Section 17.
“We must observe that what Section 17 of the Act contemplates in the proviso is that the applicant seeking to set aside an ex-parte decree inter alia must either make a deposit of the amount in question or give security”,the Bench said while adding,“What this Court in Kedarnath (Supra) laid down was that the provision as to deposit can be dispensed with by the Court. The applicant can, in other words, seek a dispensing with of the deposit and seek leave for furnishing such security as the Court may direct. Therefore, the High Court was not correct in proceeding on the basis that appellants did not make any application for dispensing with surety.”
The Bench was of the view that the security furnished by the appellants in the form of the rented shop belonging to a third party cannot be accepted as security in law. It is a patent. “If security is given, which is later found to be unacceptable even if it is within 30 days within the meaning of Article 123 of the Limitation Act, then it would not be complying with Section 17”, the Bench said while referring to the judgment in Ram Bharose v. Ganga Singh AIR 1931 Allahabad 727.
Considering the fact that no order was passed by the Court on May 6, 2014, the Bench noticed that the security was clearly unacceptable in law.The appellants also did not challenge the order of the Additional District Judge and the trial Judge was bound by the same.
“The fact that the appellants, after participating in the remanded proceedings mounted a challenge in a writ to the order dated 01.08.2017 appears to us as not advancing the case of the appellants. This is both for the reason of the belated challenge as also the nature of the earlier order involved”, the Top Court held while dismissing the appeal.
Read Order: ITO v. Maharashtra State Board of Technical Education
LE Correspondent
Mumbai, May 20, 2023: The Mumbai bench of the Income Tax Appellate Tribunal has held that the Maharashtra State Board of Technical Education (MSBTE) qualifies as a ‘State’ within the meaning of Article 12 of the Constitution of India, and as a result, is entitled to the benefit of immunity from taxation on its income under the provisions of the Income Tax Act.
The brief facts of the case were that the MSBTE (assessee) was constituted by Maharashtra State Government and was an authority for regulating technical matters pertaining to diploma level education. The Revenue contended that the payments received by the assessee were not related to imparting education and therefore did not fall within the objectives of the Board. The Revenue also claimed that the surplus amount generated by the assessee was a result of commercial activity. Additionally, the Revenue contended that the assessee should be classified as a ‘Body Corporate’ rather than a ‘State’ and should be considered an artificial juridical person.
The two-member bench of Prashant Maharishi (Accountant) and Kavitha Rajagopal (Judicial) noted that all the issues raised by the Revenue in its appeal had already been addressed and decided in favor of the assessee in a previous order, wherein it has been held that the assessee was not rendering any services in the nature of trade, commerce or business for a fees or any other consideration, rather, the assessee was engaged in regulation of educational activities as per the statutory obligation conferred on the assessee. Even otherwise, every activity of the assessee was subject to superintendence, instruction and control of the State Government. Therefore, the assessee was completely controlled financially as well as administratively by the Government, thus, falls under the definition of ‘State’. Additionally, CBDT vide its notification date 29.03.2016 has granted exemption of taxation to the assessee.
The bench concluded that the objectives of the assessee indicated its categorization as a 'State' under Article 12 of the Constitution of India. The Tribunal referred to the criteria established by the Hon'ble Supreme Court, observing that when an entity is completely controlled by either the Central or State Government, it becomes an instrumentality of the Government, and in such cases, it falls within the definition of 'State.'
Read Order: Pushpak Steel Industries Private Limited, v. ACIT
Chahat Varma
New Delhi, May 20, 2023: The Pune bench of the Income Tax Appellate Tribunal has ruled that a company is a separate legal entity, distinct from its directors or employees, therefore, there can be no disallowance of depreciation or other expenses on maintenance of the vehicles used by the directors/employees by treating it as personal user or non-business user of the company. Consequently, the disallowance of expenses incurred on the vehicles was ordered to be deleted.
Briefly stated facts of the case were that Pushpak Steel Industries Private Limited (assessee) had two vehicles listed in its balance sheet, which were used by the directors for business purposes. The assessee claimed deductions for depreciation, interest, and maintenance expenses for these vehicles. However, since the assessee failed to provide logbooks as evidence, the Assessing Officer made a disallowance of 15% of the total expenses. The Commissioner of Income Tax (Appeals) upheld the disallowance.
The Tribunal placed reliance on the judgments of Gujarat High Court in Sayaji Iron and Engineering Company vs. CIT [LQ/GujHC/2001/493], wherein it has been held that once the directors of the assessee company are entitled to use the vehicles of the company for personal use as per the terms and conditions of their appointment, it cannot be said that there was a personal use of cars. The High Court further held that such user of vehicles by the employees of the company cannot even be considered as ‘non-business user’.
Read Order: KULDIP SINGH & OTHERS v. STATE OF PUNJAB & ANOTHER
Tulip Kanth
New Delhi, May 20, 2023: In a case where the allegations pertained to the illegal encroachment/construction upon a street purportedly in the use of the complainant, the Punjab and Haryana High Court has allowed the plea of the petitioners to quash the summoning orders after finding no proof of illegal construction.
“In fact, on an identical cause of action, a civil suit was instituted by the wife of respondent No.2- complainant which came to be withdrawn vide order dated 16.12.2016 (Annexure P-7). On the other hand, the institution of the present criminal proceedings on account of a pending civil dispute between the parties in which the petitioner side had succeeded cannot be ruled”, the Bench said.
The factual background of this case was that the second respondent got an FIR registered under Sections 447/427/506/148/149 IPC with the allegations that he along with the petitioners had purchased a plot and with a mutual understanding a 10 ft. wide street was left in the middle of the plot.
He had gone out for some work and when he returned, he saw that a wall had been raised in the common street. His son told him that the armed petitioners along with certain other persons had started to demolish the gutter of sewerage and had begun to raise a wall in the street. On being stopped, he (complainant’s son) was threatened & legal action was sought.
Pursuant to the registration of the FIR, an investigation was conducted which led to the filing of a cancellation report and it was a finding that as per the record of the Department of Revenue and in the sale deed, there was no mention of any street and therefore, the accused party had not raised any illegal construction upon any land/street of the complainant and there had been no demolition of any kind.
Aggrieved with the filing of the cancellation report, the complainant filed a protest petition and the Court of the Judicial Magistrate, 1st Class, Batala summoned the petitioners. Thereafter, pursuant to the re-construction of the misplaced file/record of the criminal complaint, a fresh summoning order and the petitioners were summoned once again. The aforementioned Criminal Complaint & the first as well as second summoning orders and all subsequent proceedings arising therefrom were impugned in the petition before the High Court.
The Bench noted the fact that the allegations pertained to the illegal encroachment/construction upon a street purportedly in the use of the complainant. Allegations had also been levelled regarding the demolition of a gutter of sewerage.
After a perusal of the cancellation report and the order passed in proceedings under Section 133 Cr.P.C., the Bench opined that it was established that there was no such 10 ft. area/street in existence at the spot upon which the petitioners allegedly carried out any illegal construction. Further, there was absolutely nothing to suggest that the demolition of any gutter of sewerage had taken place.
As regards the maintainability of the present petition, it would be relevant to mention here that pursuant to the issuance of the first summoning order, the record was lost necessitating the passing of the second summoning order. The petitioners had challenged the said summoning order which came to be withdrawn with liberty to file a fresh petition challenging the first summoning order as well. Therefore, the Bench held that no fault could be found with the conduct of the petitioners.
In light of such aspects, the Bench quashed the criminal complaint, first & second summoning orders and all subsequent proceedings emanating therefrom.
Read Order: Siemens Limited v. The State of Maharashtra and Ors
Chahat Varma
New Delhi, May 20, 2023: The Bombay High Court has quashed a notice dated 24.09.2019 that was issued to Siemens Limited (petitioner), as the Commissioner had failed to complete the assessment within ten years of issuing the initial notice in Form-H.
Briefly stated issue involved was that the petitioner, was a registered dealer in Maharashtra and was liable to pay cess on bringing goods within the limits of Navi Mumbai Municipal Corporation. The Commissioner was not satisfied with the returns filed by the petitioner, leading to the issuance of notices in Form-H for each relevant year under Rule 25(3) of the Maharashtra Municipal Corporation (Cess on Entry of Goods) Rules, 1996 (Rules of 1996). According to the Local Body Tax Officer, the petitioner failed to produce relevant documents in support of the returns filed. After the last notice issued on 30.10.2014, a Form-H reminder was issued on 24.09.2019 for all the relevant years. The petitioner argued that the Municipal Corporation was not entitled to proceed further in the matter as they had not completed the assessment process for almost eight to ten years. The petitioner challenged the belated issuance of the Form-H reminder, seeking a declaration that it was contrary to the provisions of the Maharashtra Municipal Corporations Act, 1949, and the Rules of 1996.
The two-judge bench of Justice A.S. Chandurkar and Justice M.W. Chandwani said that it was clear from Rule 25(3) of the Rules of 1996 that the Commissioner should complete the assessment expeditiously. Once a dealer was given sufficient opportunity to produce the evidence on which they rely, the assessment should be completed based on the evidence provided by the dealer. If the dealer fails to produce such evidence, the assessment should be made to the best judgment of the Commissioner.
The bench noticed that there was no justification indicated by the Municipal Corporation for the failure on the part of the Commissioner to assess the amount of cess due from the petitioner to the best of the Commissioners judgment at least from 21.08.2013 till the reminder in Form-H was issued on 24.09.2019.
Observing that the Municipal Corporation was not obligated to wait endlessly till the terms of notice issued under rule 25(3) of the Rules of 1996 are complied with, the bench held that the Commissioner was empowered to take action under Rule 25(4) of the Rules if the dealer fails to submit further documents. The bench found that the failure of the petitioner to submit relevant documents cannot be a justification for the Commissioner to delay the completion of the assessment.
The bench placed reliance on Bharat Steel Tubes Limited and Another v. State of Haryana and Another [LQ/SC/1988/276] and held that the assessment proceedings are required to be completed within a reasonable time keeping in view the spirit of Rule 25 of the Rules of 1996 when read as a whole.
“We thus hold that failure to complete the process of assessment under Rule 25(3) and (4) of the Rules of 1996 for a period of more than ten years from the date of issuance of the initial notice in Form-H would render the process of assessment liable to be quashed on the ground of unreasonableness and failure to complete the assessment for no justifiable reason,” held the bench.
Read Order: Ramesh Chandra Vaishya v. The State Of Uttar Pradesh
Simran Singh
New Delhi, May 20, 2023: In a criminal appeal, the Supreme Court set aside the case pertaining to offences under sections 323 and 504, Indian Penal Code, 1860 (‘IPC’) and 3(1)(x), the Scheduled Castes and the Scheduled Tribes (Prevention of Atrocities) Act, 1989 (‘SC/ST Act’), stating that it would be an abuse of the process of law to allow continuation of the present criminal case.
In the matter at hand, the appellant challenged the order passed by the Allahabad High Court which had dismissed an application under Section 482 of the Code of Criminal Procedure, 1973 (‘CrPC’) instituted by the appellant seeking quashing of the charge-sheet as well as the pending criminal proceedings.
The prosecution’s case was that on 14-01-2016, the appellant was engaged in an altercation with the second respondent (‘complainant’) over the issue of drainage of water. It was alleged that during this altercation, the appellant verbally hurled caste related abuses towards the complainant and his family members, and subsequently physically assaulted the complainant causing him multiple injuries.
Consequently, on 20-01-2016, a First Information Report (‘FIR’) was registered against the appellant under sections 323 and 504, Indian Penal Code, 1860 and 3(1)(x), the Scheduled Castes and the Scheduled Tribes (Prevention of Atrocities) Act, 1989.
The Investigating Officer (‘IO’) reached to the conclusion, after a day’s investigation, that there were materials against the appellant to send him up for trial and consequently, a charge-sheet dated 21-01-2016 under sections 323, 504, IPC and 3(1)(x), SC/ST Act was filed against the appellant to which the court took cognisance of the offence on 03-05-2016.
The appellant, however, intended to lodge an F.I.R. arising out of the same incident as he had alleged that he was badly beaten up by the complainant and his son with canes and lathis, as a result of which he too sustained injuries. He contended that upon his allegation, the police refused to register the FIR, instead, the appellant was challaned and kept under detention by the inspector-in-charge under sections 151, 107, and 116, Cr. PC, though he was subsequently released upon furnishing a bail bond.
A second FIR was registered for the offences under sections 323, 325, 392, 452, 504, 506, IPC against the complainant. Previously the appellant had also instituted a suit before the civil court seeking permanent injunction against the complainant’s continued encroachment upon the appellant’s land which was pending consideration.
Aggrieved by the aforesaid charge-sheet, the appellant invoked the jurisdiction of the High Court under section 482, Cr. PC seeking quashing thereof as well as the criminal proceedings against him on the grounds that the said charge sheet disclosed no offence and the present prosecution had been instituted with mala fide intention for the purposes of harassment. The same was dismissed vide the impugned judgment and order.
The Bench noted that the first F.I.R., registered at the instance of the complainant, was silent about the place of occurrence and who, being a member of the public, was present when the appellant was alleged to have hurled caste related abuses at the complainant. However, on a reading of the second F.I.R. registered at the behest of the appellant, it appears that the incident took place at the house of the appellant.
The Bench navigates through the first question that called for an answer that whether it was at a place within public view that the appellant hurled caste related abuses at the complainant with an intent to insult or intimidate or humiliate him. From the charge-sheet dated 21-01-2016 filed by the IO, it appeared that the prosecution would seek to rely on the evidence of 3 witnesses to drive home the charge against the appellant of committing the aforesaid offences. These 3 witnesses were the family members of the complainant. It was noted t hat neither the first F.I.R. nor the charge-sheet referred to the presence of a fifth individual (a member of the public) at the place of occurrence.
The Bench stated that since the utterances made by the appellant were not ‘in any place within public view’, the basic ingredient for attracting section 3(1)(x) of the SC/ST Act was missing. It was therefore, held that at the relevant point of time of the incident, no member of the public was present. It was held that “assuming arguendo that the appellant had hurled caste related abuses at the complainant with a view to insult or humiliate him, the same does not advance the case of the complainant any further to bring it within the ambit of section 3(1)(x) of the SC/ST Act.”
“The legislative intent seems to be clear that every insult or intimidation for humiliation to a person would not amount to an offence under section 3(1)(x) of the SC/ST Act unless, of course, such insult or intimidation is targeted at the victim because of he being a member of a particular Scheduled Caste or Tribe. If one calls another an idiot (bewaqoof) or a fool (murkh) or a thief (chor) in any place within public view, this would obviously constitute an act intended to insult or humiliate by user of abusive or offensive language.”observed the Court.
The Bench stated that even if the same was directed generally to a person, who happened to be a SC or ST, per se, it would not be sufficient to attract section 3(1)(x) unless such words were laced with casteist remarks. “Since section 18 of the SC/ST Act bars invocation of the court’s jurisdiction under section 438, Cr.PC and having regard to the overriding effect of the SC/ST Act over other laws, it was desirable that before an accused wss subjected to a trial for alleged commission of offence under section 3(1)(x), the utterances made by him in any place within public view were outlined, if not in the F.I.R., but at least in the charge-sheet so as to enable the Court to ascertain whether the charge sheet makes out a case of an offence under the SC/ST Act having been committed for forming a proper opinion in the conspectus of the situation before it, prior to taking cognisance of the offence.”
The Court was of the view that even for the limited test that haD to be applied in a case of the present nature, the charge-sheet dated 21-01-2016 did not make out any case of an offence having been committed by the appellant under section 3(1)(x) warranting him to stand a trial.
The second question that the Court navigated through was whether the criminal proceedings against the appellant should be allowed to be taken further in view of the appellant facing accusation of offences punishable under sections 323 and 504 of IPC.
It was noted that the allegation in the first F.I.R. was that the appellant had beaten up the complainant for which he sustained multiple injuries. Although the complainant alleged that such incident was witnessed by many persons and that he sustained injuries on his hand, the charge-sheet does neither refer to any eye-witness other than the complainant’s wife and son nor to any medical report. The nature of hurt suffered by the complainant in the process is neither reflected from the first F.I.R. nor the charge-sheet. On the contrary, the appellant had the injuries suffered by him treated immediately after the incident.
“If indeed the complainant’s version were to be believed, the I.O. ought to have asked for a medical report to support the same. Completion of investigation within a day in a given case could be appreciated but in the present case it has resulted in more disservice than service to the cause of justice. ”
The Court stated that the situation became all the more glaring when in course of this proceeding the parties, including the first respondent were unable to apprise the Court the outcome of the second F.I.R. thus it did not find any ring of truth in the prosecution case to allow the proceedings to continue vis-à-vis section 323 of IPC.
The Bench hesitated in holding that even though the appellant might have abused the complainant but such abuse by itself and without anything more does not warrant subjecting the appellant to face a trial, particularly in the clear absence of the ingredient of intentional insult of such a degree that it could provoke a person to break public peace or commit any other offence.
The bench was of the view that the High Court misdirected itself in failing to appreciate the challenge to the criminal proceedings including the charge-sheet in the proper perspective and occasioned a grave failure of justice in rejecting such challenge. Accordingly, while setting aside the criminal case, stated that it would be an abuse of the process of law to allow continuation of Criminal Case
Read Order: MTR Corporation Ltd v. DCIT
Chahat Varma
New Delhi, May 19, 2023: Ruling that MTR Corporation Ltd.(assessee) did not have a Permanent Establishment (PE) in India, the Delhi bench of the Income Tax Appellate Tribunal has held that the provisions of section 44DA of the Income Tax Act would not be applicable and the income offered by the assessee under section 115A read with section 9(1)(vii) of the Income Tax Act should be accepted.
Factual matrix of the case was that the assessee was a non-resident corporate entity based in Hong Kong and was a tax resident of Hong Kong. Delhi Airport Metro Express Pvt. Ltd. (DAMEPL) issued a global tender for engineering and project management consultancy services for the airport line of Delhi Metro. The assessee participated in the tender and was awarded the contract on 19.05.2008. In the year under consideration, assessee received a sum of Rs. 28,51,54,304/- from DAMEPL. The assessee considered this amount as Fee for Technical Services (FTS) as defined under section 9(1)(vii) of the Income Tax Act. In the income tax return filed, the assessee included the amount in the taxable income on a gross basis, applying the tax rate of 10% as per section 115A of the Act. However, after examining the terms of the contract and the information provided by the assessee, the Assessing Officer (AO) discovered that a total of 24 employees had visited India during the relevant year. Among them, 21 employees had stayed in India for more than 183 days. Based on these findings, the AO concluded that the assessee had a PE or business connection in India. As a result, the AO determined that the receipt of Rs. 28,51,54,300/- from DAMEPL should be assessed as income from business and profession under section 44DA of the Income Tax Act.
The Tribunal observed that the facts presented in the case did not establish that the space and facilities provided to the assessee by DAMEPL could be regarded as a fixed place of business where the assessee conducted its business wholly or partially. The Tribunal referred to the case of Assistant Director of Income Tax v. M/s E-funds IT Solution Inc [LQ/SC/2017/1542], where the Supreme Court emphasized that the control over the physically located premises is a crucial factor in determining the existence of a fixed place of business.
The Tribunal held that it was DAMEPL that had control over the premises and the assessee had only been granted access and provided with certain space and facilities. Observing that no supporting evidence had been provided to demonstrate that the assessee conducted its business in India wholly or partly through a fixed place of business, the Tribunal concluded that the assessee did not have a PE in India.
Read Order: All India Judges Association v Union of India
Simran Singh
New Delhi, May 19, 2023: In a civil writ petition, the Supreme Court today directed the Center and the States to have a timeline to pay retired judicial officers' pension as per the enhanced pay scale in accordance with the recommendations made by the Second National Judicial Pay Commission.
In the case at hand, the Second Nations Judicial Pay Commission was constituted by the Supreme Court in 2017 for reviewing the pay scale and other conditions of Judicial Officers belonging to the subordinate judiciary all over the country. The Bench comprising of Justice J. Chelameswar and Abdul Nazeer had appointed former Supreme Court Judge, Justice P.V. Reddy as Commission Chairman and former Kerala High Court Judge and Senior Supreme Court advocate R. Basant as its member.
As per the recommendation by the Second National Judicial Pay Commission, the full bench of the then Chief Justice N.V. Ramana, Justice Krishna Murari and Justice Hima Kohli had order implementing enhanced pay scale with effect from 01-01-2016. The Center and the States were also directed to pay the arrears to the judicial officers in 3 instalments i.e. 25% in 3 months, 25% in the next 3 months and the balance amount by 20-06-2023.
The Bench vide order dated 27-07-2022, while emphasising on the need to revise the pay structure for the judicial officers, ordered for implementation of the enhanced pay scale as recommended by the Second National Judicial Pay Commission with effect from 01-01-2016. Vide its order dated 18-01-2023, the Supreme Court directed the States and Union Territories which had not yet made payment, to do the needful in instalments.
The Court had stated that they had accepted a large number of recomendation of the Second National Judicial Pay Commission. Apart from that, they had also collated the principles on the basis of which the earlier judgements were given, accepting the recommendations with respect to the District Judiciary. They related to uniformity in designation and service conditions, separation of powers, independence of the District Judiciary as part of the basic structure and judicial independence. Primarily, the Court dealt with recommendations on pay and thereafter considered pension, gratuity, etc.
The Bench also accepted various recommendations made by the Commission regarding pay and service conditions of judges and directed the High Courts to amend their service rules to give effect to them.
The Court added that ultimately the effect of acceptance of the recommendations of this Court was that necessary amendments must be carried out in Service Rules of the Judicial Officers across all jurisdictions. It was thus directed that the High Courts and the competent authorities, wherever applicable, bring the rules in conformity with the recommendations accepted by this Court within a period of 3 months. Compliance affidavits were to be placed on record by the High Courts, the States and the Union within 4 months. It was further directed that compliance affidavits must be filed by all the States and Union Territories by 30-07-2023 stating that the arrears of pay have been positively credited into the accounts of the concerned officers.
Read Order: Neville Dadi Master @ Neville Master v. The State of West Bengal & Anr
LE Correspondent
New Delhi, May 19, 2023: The Supreme Court today discharged a man who had pretended to be a practicing advocate and unlawfully entered the chamber of a civil judge, and also took photographs of case records from his mobile phone, after the accused met the complainant in person on the court’s directions and tendered unqualified apology which was to the satisfaction of the erstwhile civil judge.
The Apex Court, however, sounded a note of caution for the appellant to be careful in future to avoid recurrence of similar incident, as well as appreciated the complainant judge for not precipitating the matter further.
“After all, ‘to err is human but forgiving is divine’,” said a bench of Justice S Ravindra Bhat and Justice Dipankar Datta.
The senior counsel appearing for the offender fervently urged the Court to allow the appellant to meet the second respondent (complainant-judge) and tender his unqualified apology for the conduct complained of in the aforesaid complaint. The prayer of a was granted. The appellant was directed to meet the second respondent in person and tender unqualified apology.
The second respondent (complainant judge), in a report placed before the Registry of the Calcutta High Court, expressed that he was “satisfied with such tender”.
The senior counsel submitted that it was an act of indiscretion on the part of the appellant. However, having realized that he has committed a grave mistake for which no one else is to be faulted, he was now genuinely regretful and undertook not to repeat such conduct in future. He, accordingly, prayed that the Top Court may direct closure of the proceedings upon setting aside the orders of the Special Court and the Calcutta High Court.
The senior counsel appearing for the first respondent left the matter to the discretion of the Court.
“In the light of the aforesaid statement made by Mr. Luthra, which is treated as an undertaking of the appellant to this Court, and bearing in mind that offences under sections 447 and 419 of the Cr. P.C. are compoundable coupled with the satisfaction reported by the second respondent, this Court is of the considered view that no useful purpose would be served in subjecting the appellant to stand trial,” the Bench noted.
“Having regard to the special facts and circumstances of this particular case and to give a quietus to the matter, closure of G.R. Case No. 2199 of 2017 which the ACJM is presently seized of against the appellant is warranted upon setting aside of the orders dated 19th September, 2022 and 2nd January, 2023. It is ordered accordingly. The appellant is discharged of the bail bond.”
Case Background:
The petitioner-accused in the case is a law graduate and is enrolled under the Bar Council of Goa. He, however, does not practice as an advocate and works as Manager for a private company.
The erstwhile Civil Judge (Junior Division), 1st Court at Sealdah lodged a report on 9th August, 2017 stating that when he was working in his official chamber at around 1:20 PM, the petitioner entered his chamber and asked if he could talk with respect to some case. The Judge asked him as to why he entered his chamber without any permission. At this the petitioner stated that he wanted to know about an order passed on the previous day. The Judge immediately asked him to leave his chamber and also told him that if he wanted to know about any case, he should enquire in the office of the concerned Court.
Subsequently the Sherestedar attached to his Court came to the chamber with the said person and informed the Judge that the said person was taking photographs from his mobile phone for some orders directly from a case record. The Officer immediately seized the mobile phone and handed over the same to the police officer with the complaint.
On the basis of a written complaint submitted by the erstwhile Civil Judge, FIR under Sections 419/353/447/120B of the Indian Penal Code read with Section 12 of the Prevention of Corruption Act was registered against the petitioner. On completion of investigation, police submitted charge-sheet against the petitioner under the above-mentioned penal provisions.
Since the offence under Section 12 of the Prevention of Corruption Act is exclusively triable by the learned Special Judge, the case was committed to the learned Special Judge, 1st Special Court at Alipore.
The petitioner preferred an application praying for discharging him. The learned Judge upon hearing the learned Advocate for the parties and considering the materials on record held that there was no ground for framing charge against the petitioner under Sections 120B/353 of the Indian Penal code and Section 12 of the Prevention of Corruption Act. The learned Judge further held that there is prima facie material against the petitioner to frame charge under Sections 447/419 of the Indian Penal Code. Accordingly, the learned Special Judge transmitted the case record to the Court of the learned Additional Chief Judicial Magistrate (ACJM) at Sealdah to proceed with the case against the petitioner for offence punishable under Sections 447/419 of the Indian Penal code.
This order of the Special Court was challenged by the appellant in an application under section 482 of the Cr. P.C. before the Calcutta High Court. The Calcutta High Court, in its order dated 2nd January, 2023, dismissed the application. The petitioner-accused, via this civil appeal, challenged the Calcutta High Court order before the Top Court.
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.
**
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.
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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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