Read Order: RAM NATH v. THE STATE OF UTTAR PRADESH & ORS[SC-CRIMINAL APPEAL NO. 472 OF 2012]
Tulip Kanth
New Delhi, February 23, 2024:While observing that there are very exhaustive substantive and procedural provisions in the Food Safety and Standards Act, 2006for dealing with offences concerning unsafe food, the Supreme Court has held that section 59 will override the provisions of Sections 272 and 273 of the IPC.
The appellant had filed a petition under Section 482 of the Code of Criminal Procedure, 1973 (CrPC) seeking quashing of the prosecution for the offences punishable under Sections 272 and 273 of the IPC. The State of Uttar Pradesh issued an order granting power to the authorities to initiate prosecutions under Sections 272 and 273 of the IPC as well as under the Prevention of Food Adulteration Act, 1954. Thereafter, an FIRwas lodged by a food inspector against the petitioner alleging that though the appellant did not possess a licence to sell the commodity of mustard oil, he continued to carry on the business of sale. Another allegation was that the petitioner had adulterated the mustard oil, edible oil and rice brine oil.
The petitioner approached the High Court to quash the FIR on various grounds. The appellant relied on Allahabad High Court's decision in the case of M/s. Pepsico India Holdings (Pvt) Ltd. &Anr v. State of Uttar Pradesh &Orswhereby it was observed that from 29th July 2010, when the FSSA came into force, the provisions thereof would have an overriding effect over the foodrelated laws, including Sections 272 and 273.
Further, it was held that the police have no authority or jurisdiction to investigate a case under the FSSA. A criminal appeal was filed before the Top Court challenging the judgment of the High Court declining to quash offence u/s 272 and 273. The controversy in the present matter was whether the view taken in the case of PepsicoIndia(Supra)was correct.
It was the case of the State that there is no bar to the trial of an offender under two different enactments, but the bar is only to the punishment of the offender twice for the same offence. It was submitted that where an act or omission constitutes an offence under two enactments, the offender may be prosecuted under either one of the two enactments or both enactments but shall not be liable to be punished twice for the same offence.
The Counsel appearing for the accused submitted that the FSSA is very exhaustive legislation dealing with all aspects of food, including adulteration, unsafe food, etc. The submission was that in view of Section 5, any special law will remain unaffected by the provisions of the IPC.
Noting that the concept of unsafe food is more comprehensive than the concept of adulterated food, the Division Bench of Justice Abhay S. Oka and Justice Sanjay Karol noticed that substandard food cannot be unsafe food. Referring to subclause (v) of Clause (zz) of Section 3, the Bench opined that presence of any harmful substance in the article of food makes it unsafe food and if any adulterant is added to an article of food, which renders the article of food injurious to health, the food article becomes unsafe food. It was also observed that section 78 explicitly gives an overriding effect over the provision of subSection 3 of Section 319 of CrPC.
The Bench also made it clear that if adulteration of an article of food is made which makes such articles noxious as food or drink, the person who adulterates is guilty of an offence punishable under Section 272 of the IPC.Section 273 of the IPC applies when a person sells or, offers or exposes for sale any article of food or drink which has been rendered noxious or has become unfit for food or drink.
“Section 59 of the FSSA does not require the presence of intention as contemplated by Section 272 of the IPC. Under Section 59 of the FSSA, a person commits an offence who, whether by himself or by any person on his behalf, manufactures for sale or stores or sells or distributes any article of food for human consumption which is unsafe. So, the offence under Section 59 of the FSSA is made out even if there is an absence of intention as provided in Section 272 of the IPC. However, knowledge is an essential ingredient in subSection 1 of Section 48, and therefore, it will be a part of Section 59 of the FSSA”, the Bench said.
As per the Top Court, the maximum punishment for the offence under Section 272 of the IPC is imprisonment for a term which may extend to six months or with a fine. The substantive sentence for the offence punishable under Section 273 is the same, whereas, under Section 59, the punishment is of simple imprisonment extending from three months to a life sentence with a fine of rupees three lakh up to 10 lakhs. A limitation of one year is provided for the offence under Section 59, which is extendable up to three years as provided in Section 77 of the FSSA. By virtue of Section 468 of CrPC, the limitation for taking cognizance of the offence punishable under Sections 272 and 273 is one year. There is a power to extend time under Section 473 of CrPC. The power is not limited to three years, it added.
The Bench observed that section 89 indicates that the intention is to give an overriding effect to the FSSA over all ‘food related laws’. The main Section clearly gives overriding effect to the provisions of the FSSA over any other law in so far as the law applies to the aspects of food in the field covered by the FSSA. “When the offences under Section 272 and 273 of the IPC are made out, even the offence under Section 59 of the FSSA will be attracted. In fact, the offence under Section 59 of the FSSA is more stringent”, it added.
Reference was made to the judgment inState of Maharashtra [LQ/SC/2018/1200]wherein while dealingwith simultaneous prosecutions, the Top Court concluded that there could be simultaneous prosecutions, but conviction and sentence can be only in one. “We have no manner of doubt that by virtue of Section 89 of the FSSA, Section 59 will override the provisions of Sections 272 and 273 of the IPC. Therefore, there will not be any question of simultaneous prosecution under both the statutes”, the Bench said.
Thus, allowing the criminal appeals and setting aside the impugned orders, the Bench quashed the offences and also granted liberty to the authorities to initiate appropriate proceedings in accordance with the law if not already initiated.
Read Order: ANUN DHAWAN& ORS v. UNION OF INDIA & ORS [SC-WRIT PETITION (CIVIL) NO.1103 OF 2019]
Tulip Kanth
New Delhi, February 23, 2024:While observing that the National Food Security Act, 2013and other welfare schemes are in force to ensure access to adequate quantity of quality food at affordable prices, the Supreme Court has refused to direct the States/UTs to implement the concept of Community Kitchens.
The Division Bench of Justice Bela M. Trivedi and Justice Pankaj Mithalwas considering a petition filed by the petitioners claiming to be the social activists, seeking various directions against the States and Union Territories to formulate a scheme to implement the concept of Community Kitchens to combat hunger, malnutrition and starvation and the deaths resulting thereof. The petitioners had also sought direction against the National Legal Services Authority to formulate a scheme in order to further the provisions of Article 50(1)A of the Constitution, as also against the Central Government to create a National Food Grid beyond the scope of the Public Distribution Scheme.
By an earlier order, the Top Court had directed the Union of India to interact with the concerned stakeholders for consideration of the Community Kitchens Scheme or any other similar schemes relating to Community Kitchens which are already in operation in different states. Various orders were also passed by the Court directing the States to attend the meetings managed by the Union of India for exploring the possibility of framing up of the Community Kitchens Scheme.
The States/Union Territories had filed their counter affidavits/ responses stating in detail about the schemes adopted and enforced in their respective states like Poshan Abhiyan, Take Home Ration, Pradhan Mantri Garib Kalyan Anna Yojana, Mid-Day Meal, Open Market Sales Scheme, One Nation One Ration Card Scheme, Annapurna Scheme, Antyodaya Anna Yojana etc. also stating that some of the schemes are monitored by the Integrated Child Development Services and Integrated Tribal Development Program.
The Union of India had also submitted that the Government is committed to focus on combating hunger and malnutrition by implementing various schemes through the State Governments to enhance the food security. As per the submission, the Pradhan Mantri Garib Kalyan Anna Yojana was launched to address economic disruptions and is extended to free grain provision to Antyodaya Anna Yojana and Priority Households to alleviate poverty burdens; Atma Nirbhar Bharat Package allocated additional food grain for migrants during the Covid-19 crisis; Pradhan Mantri Poshan Shakti Nirman Scheme aims to improve nutrition among school students and accordingly allocates food grains; Scheme for Adolescent Girls focuses to improve the health and nutrition of adolescent girls aged 11 to 18 years; Annapurna Scheme provides indigent senior citizens with free food grains.
It was the case of the petitioners that the Union of India and the States had taken the steps to combat hunger, malnutrition and starvation by implementing various Central and State Government Schemes, however according to them even if the hunger, malnutrition or starvation may not necessarily result in death, the Centre and States have the constitutional duty to ensure basic sustainability of human life.
ASG R. Bala submitted that this being not an adversarial litigation, the details of schemes, programmes, policies and other measures taken by the Central Government and the State Governments had been submitted to satisfy the conscience of the court that they had successfully implemented the schemes for protecting the fundamental rights of the citizens.
“It is significant to note that though the Constitution of India does not explicitly provide for Right to food, the fundamental Right to life enshrined in Article 21 of the Constitution does include Right to live with human dignity and right to food and other basic necessities. The Article 47 of the Constitution also provides that the State shall regard the raising of level of nutrition and the standard of living of its people and the improvement of public health as among its primary duties”, the Bench said.
The Top Court noticed that keeping in view the goal of eradicating extreme poverty and hunger as one of the goals of United Nations, and keeping in view the constitutional guarantees for ensuring food security of the people as also for improving the nutritional status of the population, especially of women and children, the Parliament has enacted the National Food Security Act, 2013 (NFSA). The said Act has been implemented in all States/ UTs. One of the guiding principles of the Act is its “life cycle approach, wherein special provisions have been made for pregnant women and lactating mothers and children in the age group of 6 months to 14 years, by entitling them to receive nutritious meals free of cost, through a widespread network of Integrated Child Development Services (ICDS) centers, called Anganwadi centers under the ICDS schemes, and also through the schools under Mid-day Meal (MDM) scheme.
Noting that there is a systematic legal framework provided under the NFSA for the implementation of the schemes and programmes like Targeted Public Distribution System, Mid-day Meal Scheme, Integrated Child Development Services and Maternity Cash Entitlement along with a Monitoring Mechanism and a Grievance Redressal Mechanism, and the States/UTs having also implemented various other schemes and programmes under the said Act, the Bench was not inclinedto propose to direct the States/UTs to implement the concept of Community Kitchens as prayed for by the petitioners in the instant petition.
Referring to the judgment in Directorate of Film Festivals and Others vs. Gaurav Ashwin Jain and Others) [LQ/SC/2007/485],the Bench opined that legality of the policy, and not the wisdom or soundness of the policy, would be the subject of judicial review.
“As elaborated earlier, when the NFSA with a ‘right based approach’ for providing food and nutritional security, is in force and when other welfare schemes under the said Act have also been framed and implemented by the Union of India and the States, to ensure access to adequate quantity of quality food at affordable prices to people to live a life with dignity, we do not propose to give any further direction in that regard”, the Bench held.
Having not examined whether the concept of Community Kitchens is a better or wiser alternative available to the States to achieve the object of NFSA, the Bench left this matter open forthe States/UTs to explore alternative welfare schemes as may be permissible under the NFSA. With such observations, the petition was disposed of.
Read Order: LUCKNOW NAGAR NIGAM & OTHERS v. KOHLI BROTHERS COLOUR LAB. PVT. LTD. & OTHERS
Tulip Kanth
New Delhi, February 23, 2024: The Supreme Court has emphasized that Custodian for Enemy Property in India, in whom the enemy properties vest including the subject property, does not acquire ownership of the said properties. The enemy properties vest in the Custodian as a trustee only for the management and administration of such properties.
The subject property was an Enemy Property within the meaning of the Enemy Property Act, 1968 located on Mahatma Gandhi Marg, Lucknow, owned by the Raja of Mahmudabad, who migrated to Pakistan in the year 1947. A portion of the property has been currently occupied and utilized for profit-generating purposes by the respondent-assessee. In the fiscal year 1998-1999, it came to the Municipal Corporation’s attention that the assessee was operating a commercial establishment within the premises. Consequently, the appellant-Municipal Corporation issued a notice to the assessee regarding the assessed Annual Value.
The respondent No.2, Office of the Custodian of Enemy Property for India under the Ministry of Commerce, Government of India, issued a Certificate stating that the subject property is Enemy Property vested with the Custodian. The Certificate also explicitly stated that the Custodian was obligated to pay house tax and other local taxes on behalf of this property. The assessee, along with other tenants, contested the assessment orders. Due to outstanding dues of Rs.1,621,987.00 under the head of House Tax concerning the Enemy Property the Municipal Corporation notified of its intention to proceed with attachment and sealing of the said premises under Sections 506-509 of the UP Municipal Corporation Adhiniyam, 1959.
Raja Mohammed Amir Mohammad Khan, the son of the Raja of Mahmudabad, who remained in India as an Indian citizen, contended that these properties should no longer be vested with the Custodian after his father's demise as they were now vested in him. While the Government had agreed to release 25% of these properties, it had not yet acted upon this commitment. In response, Raja Mohammed Amir Mohammad Khan approached the Bombay High Court and the High Court ruled in his favor.
Being aggrieved with this decision, the Union of India approached the Court by way of filing SLP but the UOI was directed to get the buildings (residence or offices) vacated from such officers and handover the possession to Raja Mohammed Amir Mohammad Khan. Proceedings were initiated by various tenants, including respondent No.1. Following these events, on 28.05.2011, the appellant No.3, issued a notice to the assessee, demanding payment of Rs. 7,57,239.00. Aggrieved by this action, the assessee approached the Allahabad High Court. By virtue of the impugned judgment, the recovery notice dated 28.05.2011 was quashed on the ground that this case pertained exclusively to taxes, namely House Tax and Water Tax, which were not applicable to the respondent No.1 since the property in question was an enemy property. Hence, the appellants preferred this civil appeal.
Expounding on the law relating to Enemy property, the Division Bench of Justice B.V. Nagarathna & Justice Ujjal Bhuyan opined that the general aim of the administration of enemy property is to eliminate enemy influence from the national economy. Enemy property can be disposed of by various means including custodianship, liquidation, expropriation, confiscation or nationalization. The whole raison d’etre of a statutory regime that seeks to administer enemy property through a custodianship is to preserve and protect the properties until the war is over. After all, the law of settlement of enemy property is governed not only by considerations of diplomatic strategy but also by fundamental principles of fair governance.
One aspect which was made clear by the Bench was that since the year 1968, there have been lakhs of Indians who have settled overseas without giving up their Indian citizenship. They have acquired several movable and immovable properties in India. If, in an unforeseen eventuality, any of the countries in which such Indians are settled, is declared to be an enemy country then all such Indians who are settled abroad would possibly become enemy subjects, enemy firms and enemy companies within the definition of the Act. “In such an event, the Custodian will have to take possession of such properties. Vesting of such enemy properties in the Custodian is thus only for the purpose of administration and management of such properties”, it said.
“It is reiterated that the Custodian who is appointed under the provisions of the Act by the Central Government discharges his duties and carries out his functions under the provisions of the Act in terms of the directions of the Central Government. This is because the Act is a piece of Parliamentary legislation and in order to achieve a uniform policy vis-à-vis management and administration of enemy properties throughout the length and breadth of the country. It, therefore, cannot be held that the properties vest with the Union within the meaning of Article 285 of the Constitution. In our view, the said Article has no application to enemy properties”, the Bench held.
On the facts of the case, the Top Court opined that the respondent herein who was born in India and his Indian citizenship not being in question could not by any stretch of imagination be held to be enemy or enemy subject under Section 2(b). Similarly, under Section 2(c) the property belonging to enemy could not be termed as an enemy property. The Bench further held that whatever amount have already been deposited by the respondent herein, the same shall not be refunded to them. But, if no other demand has been made till date, such demand shall not be made. However, from the current fiscal year onwards (2024-2025), the appellant shall be entitled to levy and collect the property tax as well as water tax and sewerage charges and any other local taxes in accordance with law.
The Bench was of the view that that the Custodian for Enemy Property in India, in whom the enemy properties vest including the subject property, does not acquire ownership of the said properties. The enemy properties vest in the Custodian as a trustee only for the management and administration of such properties. “…the Central Government may, on a reference or complaint or on its own motion initiate a process of divestment of enemy property vested in the Custodian to the owner thereof or to such other person vide Rule 15 of the Rules. Hence, the vesting of the enemy property in the Custodian is only as a temporary measure and he acts as a trustee of the said properties”, the Bench clarified.
The Bench, thus came to the conclusion that Union of India cannot assume ownership of the enemy properties once the said property is vested in the Custodian as there is no transfer of ownership from the owner of the enemy property to the Custodian. Consequently, the Bench held that no ownership rights would be transferred to the Union of India. Therefore, the enemy properties which vest in the Custodian are not Union properties.
“As the enemy properties are not Union properties, clause (1) of Article 285 does not apply to enemy properties. Clause (2) of Article 285 is an exception to clause (1) and would apply only if the enemy properties are Union properties and not otherwise”, the Bench held while observing that the High Court was not right in holding that the respondent as occupier of the subject property, was not liable to pay any property tax or other local taxes to the appellant.
Thus, setting aside the impugned judgment of the High Court and allowing the appeal, the Bench ordered, “Consequently, any demand for payment of taxes under the Act of 1959 made and thereby paid by the respondent to the appellant-authority shall not be refunded. However, if no demand notices have been issued till date, the same shall not be issued but from the current fiscal year onwards (2024-2025), the appellant shall be entitled to levy and collect the property tax as well as water tax and sewerage charges and any other local taxes in accordance with law.”
Read Order: SMT. VIDYA K. & ORS v. STATE OF KARNATAKA & ORS [SC- CIVIL APPEAL Nos. 2899-2907 OF 2024]
LE Correspondent
New Delhi, February 23, 2024: The Supreme Court has clarified that service jurisprudence must begin and end with rules that govern the process of qualification, recruitment, selection, appointment and conditions of service. Appointments to these posts are in the nature of ‘status’ and the service as well as its conditions can be unilaterally changed by the amendment of the Rules.
The Karnataka Public Service Commission issued a notification on 24.12.2007 for filling up approximately 2500 posts of lecturers in the Government First Grade Colleges. Following the advertisement, the appellants in the lead matter and two other connected matters, having the required qualification, were selected to the post of Home Science lecturer on 23.09.2008.
The issue before the Division Bench of Justice Pamidighantam Sri Narasimha and Justice Aravind Kumar was whether a notification for filling up 18 posts of lecturers of Home Science in First Grade College run by State of Karnataka is liable to be quashed for not providing the breakup of the ‘subjects’ within Home Science. The Karnataka Administrative Tribunal quashed the notification on the ground that specifying the subject categories is necessary for advertising the vacant posts. Writ Petitions filed by the Karnataka Public Service Commission as well as the successful candidates were dismissed by the High Court confirming the order of the Tribunal. Thus, the present appeal was filed before the Top Court.
The Bench was concerned with the Karnataka Education Department Service (Department of Collegiate Education) (Recruitment) Rules, 1964, and the Karnataka Education Department Service (Department of Collegiate Education) (Special Recruitment) Rules, 1993.
The Top Court took note of the admitted fact that the recruitment was to the post of a lecturer in an undergraduate program in Government First Grade Colleges. The post in question being a lecturer post, was also evident from the pay scale of Rs. 8000-13500 that it carried.
The Bench placed reliance upon Rule 3 of the 1993 Rules which provides qualifications which concerns appointment to the post of lecturers in undergraduate programs. This is indicative of the fact that these lecturers, upon appointment, would be teaching undergraduate students in the Home Science department. “The qualification is therefore, confined to, a post- graduation degree in Home Science. As long as a candidate holds a master’s degree in Home Science, he/she will be qualified for applying to the post. It does not matter in which speciality within Home Science the master’s degree is obtained”, the Bench said.
The Top Court also referred to a statement made by the University Grants Commission that there was no separate subject wise provision for the post of lecturers Home Science.
The Bench further clarified, “Service jurisprudence must begin and end with rules that govern the process of qualification, recruitment, selection, appointment and conditions of service. Appointments to these posts are in the nature of ‘status’, which means that the service and its conditions can be unilaterally changed by the amendment of the Rules. The first duty of the Tribunal is to verify and examine the claims made by a party in the context of the Rule that governs the field. If the Rule does not prescribe a subject-wise speciality, there is no justification for the Tribunal or the High Court to examine the propriety, or for that matter, the beneficial effect of the rule.”
Finding error in the judgment of the High Court, the Bench opined that an undergraduate student would be required to choose a specialisation when he takes up a PG program has no bearing on the qualification of the lecturer teaching the undergraduate students. Further, the assumption of the High Court that Home Science is not a subject, instead it is a stream, or a genesis had no application to the recruitment of lecturers for an undergraduate program. For under-graduation, Home Science in itself is the subject.
Noting that UGC also considers Home Science as a subject, with subject code no. 12, as per the latest information bulletin issued by it towards National Eligibility Test conducted in December, 2023, the Bench added, “To teach undergraduates, the qualification prescribed is simply a post- graduation degree in the subject of Home Science. We repeat, it does not matter in which subject of Home Science that the post-graduation is obtained.”
It was also noticed that lecturers of Home Science in undergraduate program run by the Government First Grade Colleges have been treated as one cadre and recruitment to the posts were advertised as such. As per the Bench, if one has to follow the logic adopted by the High Court, then the entire notification will collapse as the subjects of History, Economics, Political Science, Sociology etc. are also mentioned without the so-called specialisations and they must be set aside by the same logic.
“We conclude by holding that the High Court committed an error in not focussing on what the Rule provides for and whether the advertisement is in consonance with the Rule. If the High Court had confined itself to the basic features of judicial review, it would have avoided committing the error that it did”, the Bench held while allowing the appeals.
Read Order: RAM SINGH v. THE STATE OF U.P [SC- CRIMINAL APPEAL NO. 206 OF 2024]
LE Correspondent
New Delhi, February 23, 2024: The Supreme Court has acquitted a murder convict in a case where material witnesses had not been examined, evidence of eyewitness was not credible, weapon of offence wasn’t recovered and ballistic opinion was not obtained.
The facts, as emanated from the prosecution case, were such that PW-1 Shri Radhey Lal lodged a first information in the year 1982 stating that he, his brother Desh Raj, his mother Dulli and his neighbours Lala Ram i.e. PW-3 and Man Singh i.e. PW-2 were sitting in the open space of their house and were chatting. The appellant Ram Singh accompanied by one Lala Ram came to his residence in late evening. Lala Ram had instigated Ram Singh by loudly saying that these people were creating disturbances and they had to be killed. Ram Singh fired on the informant but he slipped below the cot. The bullet hit his mother Dulli who died immediately. Informant stated that the incident was seen by his brother Desh Raj and by his neighbours Lala Ram and Man Singh in the light of the lantern. The informant further stated that about one and a half months back, there was a scuffle between his son Baan Singh and the appellant Ram Singh which matter was duly reported to the local police station. Lala Ram and Ram Singh belonged to the same party. Because of this, they came to the door of his residence when on the instigation of Lala Ram, Ram Singh fired a shot due to which his mother Dulli died.
Police investigated the crime and on completion of the investigation submitted chargesheet charging appellant Ram Singh of having committed offence under Sections 301 and 302 of the IPC as well as under Section 307/34 IPC. On the other hand, the co-accused Lala Ram was charged of having committed offence under Section 307/34 IPC.
The Sessions Court convicted the appellant under Section 301 read with Section 302 IPC and also under Section 307 IPC. However, the other accused Lala Ram was given the benefit of doubt and accordingly was acquitted. The trial court convicted the appellant under the aforesaid provisions of IPC and sentenced him accordingly. The co-accused Lala Ram, son of Dhanna Ram Yadav, was acquitted. The appeal filed by the appellant before the High Court was dismissed. Consequently, his conviction and sentence were confirmed. Therefore, the appellant approached the Top Court.
The Division Bench of Justice Abhay S. Oka & Justice Ujjal Bhuyan noted that neither Desh Raj, brother of PW-1 and son of the deceased, who was very much present at the place and time of occurrence was examined by the police nor the other brother Sunder Lal, the scribe, who had written the first information, was examined by the police. Omission to examine Desh Raj by the prosecution was most crucial as according to the prosecution version he was very much present when the incident occurred.
Finding the behaviour of Sunder Lal to be very unusual as he did not accompany PW-1 to the police station, the Bench noted that there was also no evidence that he had rushed to the place of occurrence where his mother was killed. An adverse inference was drawn against the prosecution for not examining material witnesses. Moreover, it was only PW-1 and PW-2 who had stated that Ram Singh had fired from a country made pistol at PW-1 but the bullet had hit mother of PW-1, who died of the bullet wound. On the other hand, PW-3 categorically stated that he did not see accused Ram Singh carrying any country made pistol. Further, it had come on record that there was previous enmity between PW-1 and the accused relating to election of village Pradhan because of which there were cross cases between them.
It was also brough to light that the country made pistol used by the accused in the offence, could not be recovered by the police and therefore not exhibited. Thus, the main material evidence i.e., the weapon of offence was not exhibited. Also, as per the version of PW-4, the blood stained clothes of the deceased which were seized were sent to the chemical examiner but the report from the chemical examiner was not received till the date and time of his deposition.
“From the above, it is evident that there are glaring inconsistencies in the prosecution version which have been magnified by the absence of the testimony of the material witnesses and the ballistic report coupled with the non-recovery of the weapon of crime”, the Bench held.
Reference was also made to the judgments in Gurucharan Singh Vs. State of Punjab, [LQ/SC/1962/266]; Sukhwant Singh Vs. State of Punjab, [LQ/SC/1995/440]; State of Punjab Vs. Jugraj Singh [LQ/SC/2002/228]; Gulab Vs. State of U.P; Pritinder Singh Vs. State of Punjab, [LQ/SC/2023/733].
The Bench further asserted, “Thus, what can be deduced from the above is that by itself non-recovery of the weapon of crime would not be fatal to the prosecution case. When there is such non-recovery, there would be no question of linking the empty cartridges and pellets seized during investigation with the weapon allegedly used in the crime. Obtaining of ballistic report and examination of the ballistic expert is again not an inflexible rule. It is not that in each and every case where the death of the victim is due to gunshot injury that opinion of the ballistic expert should be obtained and the expert be examined. When there is direct eye witness account which is found to be credible, omission to obtain ballistic report and nonexamination of ballistic expert may not be fatal to the prosecution case but if the evidence tendered including that of eyewitnesses do not inspire confidence or suffer from glaring inconsistencies coupled with omission to examine material witnesses, the omission to seek ballistic opinion and examination of the ballistic expert may be fatal to the prosecution case.”
Considering the factual and legal aspects, the Bench opined that the evidence tendered by the eyewitnesses suffered from serious lacunae and their evidence couldn’t be said to be credible. That apart, material witnesses had not been examined. As per the Bench, the evidence tendered on behalf of the prosecution couldn’t be said to be full proof so much so that non-recovery of the weapon of offence, non-obtaining of ballistic opinion and nonexamination of ballistic expert would be immaterial.
“In such circumstances, it cannot be said that the prosecution could prove the accusation against the appellant beyond all reasonable doubt. As a matter of fact, on the same set of evidence, the trial court gave the benefit of doubt to the other accused Lala Ram primarily on the ground that there was a grudge between the accused and PW-1”, it added.
The Top Court was of the view that the appellant should be given the benefit of doubt as the prosecution could not prove his guilt beyond all reasonable doubt. Any lingering doubt about the involvement of an accused in the crime he is accused of committing, must weigh on the mind of the court and in such a situation, the benefit of doubt must be given to the accused. This is more so when the co-accused is acquitted by the trial court on the same set of evidence, the Bench said.
Thus, the Apex Court set aside the conviction and sentence of the accused and directed him to be released from jail forthwith.
Read Order: THE TEHSILDAR, URBAN IMPROVEMENT TRUST AND ANR v. GANGA BAI MENARIYA (DEAD) THROUGH LRS. AND OTHERS [SC- CIVIL APPEAL NO. 722 OF 2012]
LE Correspondent
New Delhi, February 22, 2024: Highlighting the total casualness on the part of the litigants in not placing on record correct copies of the judgments of the Trial Court as well as the First Appellate Court when five different suits were filed by different persons, the Supreme Court has asked the parties to be more careful while filing the pleadings.
The respondents filed the suit on 10.05.1999 for permanent injunction against the appellants and also claimed ownership and possession of the suit land on which a room had been constructed. It was claimed that the suit land was purchased by the respondents-plaintiffs from Panchayat Titardi in 1959 and a boundary wall was constructed in the year 1960. The suit was filed as a notice was issued by the appellants under Section 92A of the 1959 Act (Rajasthan Urban Improvement Act, 1959).
The stand taken by the appellants was that the land in question was a Government land (Bilanam Sarkar) earmarked for grazing cattles (gochar land) and the Gram Panchayat was not competent to grant lease in respect to the aforesaid land, especially when it was ear-marked for grazing cattles. Notice was issued on receiving information that the respondents-plaintiffs had encroached upon the land. It was also pleaded that Gram Panchayat, Titardi was a necessary party but had not been impleaded. In the revenue record, the land was still shown to be owned by the Government. In case the claim of respondents-plaintiffs was that it was given on lease to them, there was no mutation entered on the basis thereof.
The Trial Court dismissed the suit, however, First Appellate Court (Additional District Judge, Udaipur) accepted the appeal and decreed the suit restraining the defendants from interfering in the possession of the plaintiffs in the suit land. The appeal preferred before the Rajasthan High Court by the present appellants was dismissed. It was this judgment which was impugned before the Top Court.
To prove the lease in their favour, the respondents-plaintiffs had produced in evidence a document claiming to be lease deed executed by the Gram Panchayat in favour of late Ganga Bai widow of Jai Shankar Menaria. In the stand taken by the appellants, the land being reserved for grazing cattles could not possibly be leased out by the Gram Panchayat.
The plea sought to be taken by the respondents was that the document being more than 30 years old, there was presumption of truth in terms of Section 90 of the 1872 Act. The Division Bench of Justice Vikram Nath & Justice Rajesh Bindal noted that this section provides that if the document is more than 30 years old and is being produced from proper custody, a presumption is available to the effect that signatures and every other part of such document, which purports to be in the handwriting of any particular person, is in that person’s handwriting and in case a document is executed or attested, the same was executed and attested by the persons by whom it purports to be executed and attested. This does not lead to a presumption that recitals therein are correct. Reference was made to the judgment in Union of India v. Brahim Uddin and another [LQ/SC/2012/578] .
It was also noticed that nothing was referred to by the respondents from the record to show the reasons for producing copy of the document in Court and not summoning the record from the Gram Panchayat to prove execution of the alleged lease in their favour. Effort was made to prove the document by producing two witnesses. (PW4 and PW5 stated that the lease was granted in favour of the respondents). It was signed by the Sarpanch. However, there was no material on record to show that, except the oral statements of aforesaid two witnesses that at the relevant time, namely, in the year 1959, they were members of the Gram Panchayat otherwise the lease deed placed on record by the respondents-plaintiffs as such did not contain their signatures. “If the respondents-plaintiffs wished to prove the contents of the document in question, they could very well summon the record from the Gram Panchayat when a specific plea taken by the appellants was that the document was forged and the Gram Panchayat did not have competence to lease out the land”, the Bench added.
As the respondents-plaintiffs while filing the civil suit did not implead the Gram Panchayat as party, so in such circumstances, the respondents-plaintiffs were required to prove the document as the competence of the Gram Panchayat to lease out the land itself was in question. “…it was incumbent on the respondents to have proved their title on the land, which they failed to establish”, the Bench said.
Placing reliance upon the judgment in Anathula Sudhakar v. P. Buchi Reddy (Dead) by Lrs. and ors. [LQ/SC/2008/747], the Top Court held, “Further a suit simpliciter for injunction may not be maintainable as the title of the property of the plaintiff/respondent was disputed by the appellants/defendants. In such a situation it was required for the respondent/plaintiff to prove the title of the property while praying for injunction.”
Thus, setting aside the judgment and decree of the First Appellate Court as well as the High Court, the Bench dismissed the suit filed by the respondents.
In another set of appeals, the Radheshyam son of Bhagwati Prasad and his family members filed five civil suits praying for permanent injunction. Civil Suits were filed claiming that the land in question was leased out to the plaintiffs on 27.08.1985. However, in the annexed documents, the transaction was shown to be sale. The suit for permanent injunction was dismissed by the Trial Court. The judgment and decree in all the suits were challenged by filing appeals. The appeal was accepted and decree of permanent injunction was passed by the First Appellate Court against which the appeals were filed by the present appellants before the High Court. The same was disposed of in terms of the impugned judgment.
The Top Court found merit in these appeals as nothing was produced on record to show that the due process required for leasing out/sale of the land in favour of the respondents/plaintiffs by private negotiation was followed. Gram Panchayat from whom the land was taken was not impleaded as party to admit or deny the allegations made by the respondents/plaintiffs in the plaint.
Before parting with the order, the Bench highlighted the total casualness on the part of the appellants as in the bunch of five appeals, challenge was to the order passed by the High Court in five different second appeals. As per the Bench, when five different suits were filed by different persons while filing the documents with the paper book filed in this Court, it was incumbent upon the appellants to place on record correct copies of the judgments of the Trial Court as well as the First Appellate Court for each of the case. However, it was evident that in all the appeals the Trial Court judgment placed on record was passed in a Case titled as Smt. Sumitra Devi w/o Radheshyam Tripathi dated 30.04.2003 and the judgment of the First Appellate Court placed on record in all the appeals was a case titled as Radheshyam son of Bhagwati Prasad Tripathi dated 19.04.2004.
“The related judgments of the individual cases before the Trial Court and the lower Appellate Court have not been placed on record in the respective appeals. With great deal of effort to join the loose ends, we could find out the details from the title of the impugned judgment of the High Court as the same mentioned the civil suit number as well as the appeal number in the First Appellate Court which was different in all five cases”, the Bench opined while also adding, “We can only observe that the parties need to be more careful while filing the pleadings in this Court and so the Registry of this Court as any error therein may be disastrous for any of the parties.”
Read Order: MAHTAB TYAGI v. THE STATE GOVT. OF NCT OF DELHI [DEL HC- BAIL APPLN. 3030/2022]
LE Correspondent
New Delhi, February 22, 2024: Instead of granting bail to a man booked under the NDPS Act, the Delhi High Court has asked the Trial Court to conclude the trial within 6 months. The High Court has also clarified that the applicant would be at liberty to renew the prayer for being released on bail if there is delay in conclusion of the trial.
It was the case of the prosecution that on 06.02.2021, information was received by the police that a truck carrying Ganja was travelling from Kalindi Kunj to Sarita Vihar. The Police Officials along-with the truck, caught its driver/the applicant herein and another person, namely Ashwani Yadav, who was sitting with him in the truck. Upon preliminary search of the truck, 104 packets of Ganja were found, which weighed 525 kgs in total. Upon interrogation, the applicant disclosed that he is the owner of the truck and one Sonu Pathan had told him that two persons, namely Pramod and Ashwani, are involved in the business of illegal transportation of Ganja from Andhra Pradesh to Delhi.
He was alleged to have stated that Sonu Pathan convinced the applicant that if he uses his vehicle for transportation of Ganja, he would earn a good amount of money. He disclosed that he along with Ashwani loaded the Ganja in the truck from Sambalkot, Andhra Pradesh, and the co-accused Ashwani accompanied him during transportation. It was while being en-route that they were intercepted and apprehended by the police.
The Counsel for the applicant submitted that the accused was arrested on 07.02.2021 and has been in custody for over 3 years. It was also submitted that the applicant had been falsely implicated in this case and the police had prepared a false arrest memo.
The State Counsel contended that the applicant had, in active connivance with the co-accused persons, transported Ganja in his own vehicle from Andhra Pradesh to Delhi. Ganja weighing 525 kgs has been recovered from his possession, which was way over the commercial quantity. Even the FSL report confirmed the recovered substance to be Ganja.
The Single-Judge Bench of Justice Navin Chawla noticed that though the applicant had been in custody since 07.02.2021 and the charge-sheet had been filed on 21.09.2021, some of the co-accused were yet to be apprehended. The stage of the trial had not been stated by the parties. It was also noticed that the applicant was stated to have been found with 525 Kgs of Ganja, which is commercial quantity.
Referring to the judgment in Rabi Prakash v. State of Odisha, the Bench said, “Though in Rabi Prakash (Supra), the Supreme Court has held that the prolonged incarceration generally militates against the most precious fundamental right guaranteed under Article 21 of the Constitution of India and that the conditional liberty must override the statutory embargo created under Section 37(1)(b)(ii) of the NDPS Act, each case has to be considered on its own facts. Mere delay in conclusion of the trial may not be sufficient to release the accused on bail.”
The High Court took notice of the fact that the applicant was alleged to have been apprehended while carrying Ganja in his truck from Andhra Pradesh to Delhi. The quantity alleged to have been recovered was commercial.
The Bench, thus, observed that instead of releasing the applicant on bail, ends of justice would be met by requesting the Trial Court to expedite the trial and make an endeavour to conclude the same within a period of 6 months. “In case there is delay in conclusion of the trial, the applicant shall be at liberty to renew this prayer for being released on bail, in accordance with law”, the Bench added.
Read Order: VIJAY DAHIYA v. STATE OF NCT OF DELHI [DEL HC- W.P.(CRL) 340/2024]
Tulip Kanth
New Delhi, February 22, 2024: Taking note of the fact that the petitioner-convict demonstrated a commitment to his parental responsibilities, the Delhi High Court has granted him parole for a month so that he could take his son to the Board examination centre.
The Single-Judge Bench of Justice Swarana Kanta Sharma was considering an application filed under Section 482 of the Code of Criminal Procedure, 1973 on behalf of petitioner seeking directions against the respondent. By way of the writ petition filed under Article 226 of the Constitution of India the petitioner had sought issuance of writ in the nature of mandamus directing respondent to release the petitioner on parole for a period of one month.
The petitioner has been confined in Tihar Jail, New Delhi. By virtue of a judgment, the petitioner was convicted under Sections 302/120B/34 of Indian Penal Code, 1860 and was sentenced to undergo imprisonment for life by the Trial Court. His appeal against conviction was also dismissed.
It was the petitioner’s case that despite there being two orders directing the respondents to treat this petition as a representation and decide it on merits, the respondent had yet not decided the parole application of the petitioner. It was argued that petitioner is required to take his child to the examination center, since his child has to appear for his board examinations starting from 21.02.2024 to 13.03.2024. It was submitted that considering the urgency of the matter, the present petition be decided and parole be granted to the petitioner for a period of one month, as prayed for.
The State Counsel submitted that the application filed by the petitioner was pending before the competent authority. It was stated that his application for parole was being treated with priority, however, considering the urgency in this case, this Court may pass an appropriate order disposing of this petition.
Vide an order dated 31.01.2024, the High Court had directed the competent authority to decide the application for grant of parole to the petitioner within a period of one week. Thereafter, again vide another order, direction was issued to the respondent to decide the application filed by the petitioner within a period of 3 days. However, till date, the petitioner's application for parole, preferred before the respondent/competent authority had not been decided.
The Bench took note of the fact that petitioner's son has to appear for his CBSE Board Examinations and the petitioner’s wife has another minor child to look after and she would not be in a position to travel each time for dropping their son for the examination purpose.
“This Court, after careful consideration of the facts and circumstances, is of the opinion that presence of the petitioner to accompany his son for his Board examinations is both reasonable and in the best interest of the child's welfare. Considering the importance of parental involvement in a child's education, it is important to facilitate such opportunities, particularly in circumstances where the father demonstrates a commitment to his parental responsibilities, and where the other parent i.e. the petitioner's wife may not be in a position to accompany the son to examination centre”, the Bench held.
The Bench further opined that while dealing with the issues such as present one, this Court must balance the competing interests of State as well as the inherent responsibility of parents towards their children as well as their academic pursuits.
Considering such circumstances and also the fact that the petitioner has been granted interim bail and furlough previously and that he had never misused the liberty granted to him, the Court granted parole to the petitioner for a period of one month from the date of his release on few conditions.
Read Order: STATE THROUGH INSPECTOR OF POLICE CBI CHENNAI v. NARESH PRASAD AGARWAL & ANR [SC- CRIMINAL APPEAL NOS. 829-830 OF 2024]
Tulip Kanth
New Delhi, February 22, 2024: The Supreme Court has clarified that retaining file of a case for a period of five months after demitting the office is an act of gross impropriety on the part of a Judge. The Top Court highlighted Lord Hewart’s saying that “justice must not only be done, but must also be seen to be done.”
The Division Bench of Justice Abhay S. Oka and Justice Ujjal Bhuyan was considering a matter wherein the Single Judge of the Madras High Court decided two proceedings by the impugned judgment. The first was a petition under Section 482 of the Code of Criminal Procedure, 1973 for quashing the charge sheet in a complaint case pending on the file of the Special Judge, CBI cases, Chennai. The second was a Criminal Revision Application challenging the order by which an application for discharge made by the respondents in the same case was rejected by the impugned judgment. The Judge had quashed the charge sheet, insofar as the first respondent was concerned and passed an order of discharge as regards another accused.
It was argued before the Apex Court that on April 17, 2017, the Single Judge pronounced only one line order declaring the operative part and demitted office on May 26, 2017. The detailed judgment was made available only on October 23, 2017, nearly 5 months after the Judge demitted the office.
The Bench noticed that the operative part was pronounced on April 17, 2017 and there were five weeks available for the Judge to release the reasoned judgment till the date on which he demitted office. However, the detailed judgment running into more than 250 pages had come out after a lapse of 5 months from the date on which the Judge demitted the office. “Thus, it is obvious that even after the learned Judge demitted the office, he assigned reasons and made the judgment ready. According to us, retaining file of a case for a period of 5 months after demitting the office is an act of gross impropriety on the part of the learned Judge. We cannot countenance what has been done in this case”, the Bench observed.
Referring to Lord Hewart’s saying that "justice must not only be done, but must also be seen to be done", the Bench asserted, “What has been done in this case is contrary to what Lord Hewart said. We cannot support such acts of impropriety and, therefore, in our view, the only option for this Court is to set aside the impugned judgment and remit the cases to the High Court for a fresh decision.
Therefore, setting aside the impugned judgment, the Bench restored both the matters to the file of the Madras High Court.
Read Order: Babasaheb Dhondiba Kute v. Radhu Vithoba Barde [SC- CIVIL APPEAL NO. 2458 OF 2024]
Tulip Kanth
New Delhi, February 22, 2024: While grating the relief of specific performance of the agreement to sell to the plaintiff, the Supreme Court has stated that section 36A of the Maharashtra Land Revenue Code requires the non-tribal to make an application for a previous sanction before a conveyance could be made by a tribal in favour of non-tribal before the State Government.
The facts of this case were such that the appellant-plaintiff and the respondent-defendant entered into an agreement to sell under which, the defendant agreed to sell his land to the plaintiff for a total consideration of Rs 2,25,000. An advance amount of Rs.1,55,000 was paid by the plaintiff to the defendant on the said date. Thereafter possession was stated to have been given in the year 2003 by the defendant to the plaintiff. On 10.01.2003, the plaintiff paid an additional consideration of Rs 65,000 and thus out of a total consideration of Rs.2,25,000/-, an amount of Rs 2,20,000 was paid.
Since the defendant did not perform his part of the contract to execute the sale deed, the plaintiff filed a Special Civil Suit before the concerned trial Court seeking the decree for specific performance of the agreement to sell. The trial court framed the issues for its consideration and ultimately refused the decree of specific performance and granted the alternative relief of refund of Rs.2,20,000with interest 6% p.a.
Being aggrieved by the denial of the decree for specific performance of the agreement to sell, the plaintiff preferred his appeal before the First Appellate Court. The First Appellate Court (Ad-hoc District Judge) affirmed the judgment of the trial Court but increased the rate of interest from 6% to 14% from the date of the decree. He also directed the plaintiff to hand over possession to the defendant. Against this decision, the plaintiff preferred the second appeal, before the High Court. The High Court considered Section 36A of the Maharashtra Land Revenue Code, 1966 and observed that such a decree for specific performance could not be granted and thereby, dismissed the second appeal. Hence, the appellant approached the Top Court.
The Division Bench of Justice B.V. Nagarathna and Justice Augustine George Masih noted that the High Court had focused itself only on the aspect regarding Section 36A of the Land Revenue Code to deny relief to the appellant-plaintiff. The trial Court, the First Appellate Court as well as the High Court had concurrently held that there was indeed an agreement to sell between the parties and the plaintiff had paid a sum of Rs.2,20,000/- out of a total consideration of Rs.2,25,000/- to the defendant-respondent herein, who had also handed over possession of the subject land to the plaintiff.
Referring to Section 36A, the Bench opined that there is only a restriction on the transfer to be made by a tribal in favour of the non-tribal by way of sale, gift, exchange, mortgage, lease or otherwise. Such a restriction is in the context of requiring the non-tribal to make an application for a previous sanction before such a conveyance could be made by a tribal (defendant/ respondent) in favour of non-tribal (plaintiff/appellant) before the State Government so as to seek previous approval of the State Government only after a previous approval of the State Government could such a sale take place.
It was also made clear by the Bench that the conveyance by way of sale would take place only at the time of registration of a sale deed in accordance with Section 17 of the Registration Act, 2008. Till then, there is no conveyance. “Therefore, there is no bar for a tribal to enter into an agreement to sell and seeking advance sale consideration. However, before conveying the land by the tribal in favour of a non-tribal, the requisites of Section 36A must be complied with by the non-tribal before the State Government in terms of Section 36A of the Land Revenue Code”, the Bench noted.
Further observing that this stage had not yet arisen in the instant case, for the reason that the defendant failed to perform his part of the agreement inasmuch as he did not come forward to execute the sale deed, the Bench added that if the defendant had come forward to execute the sale deed in favour of the plaintiff, then it would have been the duty of the appellant to have proceeded under Section 36A of the Land Revenue Code and seek the requisite permission or previous sanction from the Collector.
In view of the defendant not performing his part of the agreement to sell, the plaintiff was constrained to file suit for specific performance. When all the courts have held that the plaintiff has performed his part of the agreement inasmuch as he had tendered a sum of Rs.2,20,000 out of a total consideration of Rs.2,25,000 and he was ready and willing to perform the rest of the obligation under the contract, it was only in the context of non-performance by the defendant that the plaintiff was constrained to file the suit for specific performance. Therefore, the Bench held that on the basis of Section 36A, the trial Court, the first appellate court as well as the High Court could not have declined to grant the decree for specific performance to the plaintiff inasmuch as the considerations under the provisions of the Specific Relief Act, 1963 only had to be made for the purpose of adjudicating the suit between the parties.
“Since there was no reason to decline the grant of a decree under the provisions of the said Act, the trial Court, the First Appellate Court as well as the High Court ought to have granted the said decree rather than granting an alternative relief”, the Bench added.
In such circumstances, the Bench decreed the suit filed by the plaintiff by holding that the plaintiff would be entitled to the relief specific performance of the agreement to sell. It was also made clear by the Top Court that he appellant-plaintiff shall proceed under Section 36A before seeking conveyance of the subject land in his favour in case the defendant is a tribal.
Read Order: MOHD ABAAD ALI & ANR v. DIRECTORATE OF REVENUE PROSECUTION INTELLIGENCE [SC- CRIMINAL APPEAL NO. 1056 OF 2024]
Tulip Kanth
New Delhi, February 22, 2024: Expounding on the law relating to limitation, the Supreme Court has clarified that Section 5 of the old Limitation Act, 1908 will not apply when the period of limitation is given in special Acts whereas the 1963 Act makes Section 5 applicable even in the special laws when a period of limitation is prescribed, unless it is expressly excluded by such special law.
The present appellant, before the Top Court, was one of the four accused in a case instituted under Section 135(1)(b) of Customs Act, 1962. He faced trial where he was ultimately acquitted by the Additional Sessions Judge, North, Delhi vide an order passed in 2012.
Against the order of acquittal, the Directorate of Revenue Intelligence filed an appeal before the High Court under Section 378 of CrPC and the same was accompanied by a delay condonation application, since the appeal was belated by 72 days. The delay condonation application was allowed by the Delhi High Court.
An application was then moved by the present appellant before the High Court under Section 482 of CrPC for recalling of the said order on grounds that Section 5 of the Limitation Act would not apply in case of an appeal against acquittal since the period of filing an appeal against acquittal, had been prescribed u/s 378(5) of CrPC itself, where there is no provision for condonation of delay. By an order of 2017, the Delhi High Court dismissed the application for recall filed by the appellant, although no reasons were assigned while dismissing the application under Section 482.
This order was challenged before the Supreme Court the grounds that the High Court committed a patent error in allowing the belated appeal against acquittal filed by public servant as the High Court has no powers to condone the delay since the provisions of the Limitation Act would not be applicable. It was stated that Section 378 is a self-contained Code as far as limitation is concerned since there is no period prescribed in the Limitation Act for filing an appeal against acquittal. In support of the arguments, the appellant relied upon the judgment in Kaushalya Rani v. Gopal Singh [LQ/SC/1963/222].
Referring to Section 29(2) of the old Limitation Act, the Division Bench of Justice Sudhanshu Dhulia and Justice Prasanna Bhalachandra Varale opined that where there is a special or local law prescribing the period of limitation in any suit, appeal or application which is different from the period of limitation prescribed in the first schedule of the Limitation Act, the applicability of the Limitation Act will be only as regarding Section 4 and Sections 9 to 18 & 22 of the Limitation Act. Section 5 of the old Act was expressly excluded in cases where special law or local law provides for a period of limitation.
The Bench took note of the fact that subsequent to the decision of this Court in Kaushalya Rani (supra), this Court in Mangu Ram v. Municipal Corporation of Delhi, [LQ/SC/1975/412] while dealing with a similar problem of limitation (in an appeal against acquittal), distinguished Kaushalya Rani as Kaushalya Rani was dealing with the old Criminal Procedure Code,1898 and the old Limitation Act, 1908, where provisions were differently worded. Under Section 378 of the new CrPC read with Section 29(2) of the Limitation Act, 1963 though a limitation is prescribed, yet Section 29(2) of 1963 Act, does not exclude the application of Section 5, it added.
In both the Limitation Acts, i.e. Limitation Act of 1908 and the present Limitation Act of 1963, the provision of extension of time of limitation is given in Section 5 of the two Acts. Whereas 1908 Act specifically states that Section 5 will not apply when the period of limitation is given in special Acts, the 1963 Act makes Section 5 applicable even in the special laws when a period of limitation is prescribed, unless it is expressly excluded by such special law.
“There can be no quarrel with the argument that where a special law prescribes a period of limitation, Section 5 of the Limitation Act would have no application, subject only to the language used in the special statute. The language prescribing a period of limitation is an important factor as well”, the Bench noted.
The Top Court also referred to Gopal Sardar v. Karuna Sardar [LQ/SC/2004/317] wherein it was opined that though Section 5 of the Limitation Act would apply in the case of appeal but it will not apply in a case when the proceedings itself had to be initiated in form of suit under
Section 8 of the Act which had to be done within a period of 4 months. According to the Bench, Neither Hukumdev Narain Yadav v. Lalit Narain Mishra nor Gopal Sardar(Supra) would help the case of the appellant as both these cases deal with special laws which prescribed a period of limitation and the expression of the language contained in the law is very clear that under no circumstances can such a limitation be condoned.
The Bench concluded the matter by further observing, “In the present case, there is no such exclusionary provision under Section 378 of CrPC, or at any other place in the Code. The benefit of Section 5 read with Sections 2 and 3 of the Limitation Act, 1963 can therefore be availed in an appeal against acquittal. There is no force in the contentions raised by the appellants as regards the non-application of Section 5 of the Limitation Act in the present case and the appeal is therefore dismissed.”
Thus, vacating the interim order, the Bench directed the Registry to apprise these proceedings to the Delhi High Court so that the matter may continue.
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.
Top of FormS
Subsequently, N.N. Global initiated legal proceedings against the cashing of the Bank Guarantee in a Commercial Court. In response thereto, Indo Unique moved an application under Section 8 of the A&C Act, requesting that the Parties to the dispute be referred for arbitration. The Commercial Court dismissed the Section 8 application, citing the unstamped status of the Work Order as one of the grounds. Dissatisfied with the Commercial Court's decision on 18 January 2018, Indo Unique filed a Writ Petition before the High Court of Bombay seeking that the Order passed by the Commercial Court be quashed or set aside. The Hon’ble Bombay High Court on 30 September 2020 allowed the Writ Petition filed by Indo Unique, aggrieved by which, N.N. Global filed a Special Leave Petition before the Supreme Court of India.
N. N. Global Mercantile Pvt. Ltd. v. Indo Unique Flame Ltd. – I
The issue in the matter of M/s N.N. Global Mercantile Pvt. Ltd. v. M/s Indo Unqiue Flame Ltd. & Ors. came up before a three-bench of the Supreme Court of India i.e. in a situation when an underlying contract is not stamped or is insufficiently stamped, as required under the Indian Stamp Act 1899, would that also render the arbitration clause as non-existent and/or unenforceable (‘N.N. Global Mercantile Pvt. Ltd. v. Indo Flame Ltd. – I’).
The Hon’ble Supreme Court of India whilst emphasizing the 'Doctrine of Separability' of an arbitration agreement held that the non-payment of stamp duty on the commercial contract would not invalidate, vitiate, or render the arbitration clause as unenforceable, because the arbitration agreement is considered an independent contract from the main contract, and the existence and/or validity of an arbitration clause is not conditional on the stamping of a contract. The Hon’ble Supreme Court further held that deficiency in stamp duty of a contract is a curable defect and that the deficiency in stamp duty on the work order, would not affect the validity and/or enforceability of the arbitration clause, thus applying the Doctrine of Separability. The arbitration agreement remains valid and enforceable even if the main contract, within which it is embedded, is not admissible in evidence owing to lack of stamping.
The Hon’ble Apex Court, however, considered it appropriate to refer the issue i.e. whether unstamped instrument/document, would also render an arbitration clause as non-existent, unenforceable, to a constitutional bench of five-bench of the Supreme Court.
N. N. Global Mercantile (P) Ltd. v. Indo Unique Flame Ltd. – II
On 25 April 2023, a five-judge bench of the Hon’ble Supreme Court of India in the matter of N. N. Mercantile Private Limited v. Indo Unique Flame Ltd. & Ors. held that (1) An unstamped instrument containing an arbitration agreement cannot be said to be a contract which is enforceable in law within the meaning of Section 2(h) of the Indian Contract Act 1872 and would be void under Section 2(g) of the Indian Contract Act 1872, (2) an unstamped instrument which is not a contract nor enforceable cannot be acted upon unless it is duly stamped, and would not otherwise exist in the eyes of the law, (3) the certified copy of the arbitration agreement produced before a Court, must clearly indicate the stamp duty paid on the instrument, (4) the Court exercising its power in appointing an arbitration under Section 11 of the A&C Act, is required to act in terms of Section 33 and Section 35 of the Indian Stamp Act 1899 (N. N. Global Mercantile (P) Ltd. v. Indo Unique Flame Ltd. – II).
N. N. Global Mercantile (P) Ltd. v. Indo Unique Flame Ltd. – III
A seven-judge bench of the Supreme Court of India on 13 December 2023 in its recent judgment in re: Interplay between arbitration agreements under the Arbitration & Conciliation Act 1996 and the Indian Stamp Act 1899, (1) Agreements lacking proper stamping or inadequately stamped are deemed inadmissible as evidence under Section 35 of the Stamp Act. However, such agreements are not automatically rendered void or unenforceable ab initio; (2) non-stamping or insufficient stamping of a contract is a curable defect, (2) the issue of stamping is not subject to determination under Sections 8 or 11 of the A&C Act by a Court. The concerned Court is only required to assess the prima facie existence of the arbitration agreement, separate from concerns related to stamping, and (3) any objections pertaining to the stamping of the agreement would fall within the jurisdiction of the arbitral tribunal. Accordingly, the decision in N. N. Global Mercantile (P) Ltd. v. Indo Unique Flame Ltd. – II and SMS Tea (supra) was overruled, by the seven-judge bench of the Supreme Court of India.
Kunal is a qualified lawyer with more than nine years of experience and has completed his LL.M. in Dispute Resolution (specialisation in International Commercial Arbitration) from Straus Institute for Dispute Resolution, Pepperdine University, California.
Kunal currently has his own independent practice and specializes in commercial/construction arbitration as well as civil litigation. He has handled several matters relating to Civil Law and arbitrations (both domestic and international) and has appeared before the Supreme Court of India, High Court of Delhi, District Courts of Delhi and various other tribunals.
No Safe Harbour For Google On Trademark Infringement
By Mayank Grover & Pratibha Vyas
October 9, 2023
Innovation, patience, dedication and uniqueness culminate in establishing a distinct identity. A trademark aids in identifying the source and quality, shaping perceptions about the identity's essence. When values accompany a product or service's trademark, safeguarding against misuse and infringement becomes crucial. A recent pronouncement of a Division Bench of the Delhi High Court dated August 10, 2023 in Google LLC v. DRS Logistics (P) Ltd. & Ors. and Google India Private Limited v. DRS Logistics (P) Ltd. & Ors. directed that Google’s use of trademarks as keywords for its Google Ads Programme does amount to ‘use’ in advertising under the Trademarks Act and the benefit of safe harbour would not be available to Google if such keywords infringe on the concerned trademark.
Factual Background
Google LLC manages and operates the Google Search Engine and Ads Programme, while, Google India Private Limited is a subsidiary of Google that has been appointed as a non-exclusive reseller of the Ads Programme in India. The Respondents, DRS Logistics and Agarwal Packers and Movers Pvt. Ltd. are leading packaging, moving and logistics service providers in India.
On 22.12.2011, DRS filed a suit against Google and Just Dial Ltd. under provisions of the Trademarks Act, 1999 (‘TM Act’) inter alia seeking a permanent injunction against Google from permitting third parties from infringing, passing off etc. the relevant trademarks of DRS. The core of the dispute revolved around Google’s Ads Programme. DRS claimed that its trade name 'AGARWAL PACKERS AND MOVERS' is widely recognized and a 'well-known' trademark. Use of DRS’s trademark as a keyword diverts internet traffic from its website to that of its competitors and they were entitled to seek restraint against Google for permitting third parties who are not authorized to use the said trademark. DRS further argued that Google benefits from these trademark infringements. This practice involved charging a higher amount for displaying these ads, constituting an infringement of their trademarks. Whereas, Google contended that the use of the keyword in the Ads Programme does not amount to ‘use’ under the TM Act notwithstanding that the keyword is/or similar to a trademark. Thus, the use of a term as a keyword cannot be construed as an infringement of a trademark under the TM Act, and being an intermediary, it claimed a safe harbour under Section 79 of the Information Technology Act, 2000. (‘IT Act’).
In essence, the dispute between the parties was rooted in DRS’s grievance concerning the Ads Programme. The Learned Single Judge vide judgment dated 30.10.2021interpreted relevant provisions of the TM Act and drew on multiple legal precedents to arrive at the decision that DRS can seek protection of its trademarks which were registered under Section 28 of the TM Act and issued directions to investigate complaints alleging the use of trademark and/or to ascertain whether a sponsored result has an effect of infringing a trademark or passing off.
Being aggrieved, Google LLC and Google Pvt. Ltd. filed appeals before the Division Bench. Google LLC argued that the Single Judge’s findings were erroneous and the directions issued were liable to be set aside. Google India claimed that it doesn’t control and operate the Search Engine and the Ads Programme making it unable to comply with the directions passed in the impugned judgment.
Analysis & Decision of Court
The Division Bench found Single Judge’s rationale for assessing trademark infringement through keywords and meta-tags valid. Meta-tags are a list of words/code in a website, not readily visible to the naked eye. It serves as a tool for indexing the website by a search engine. If a trademark of a third party is used as a meta-tag, the same would serve as identifying the website as relevant to the search query that includes the trademark as a search term. The use of keywords in the Ads Programme also serves similar purpose. The Division Bench was unable to accept that using a trademark as a keyword, even if not visible, would not be considered trademark use under the TM Act.
Google placed heavy reliance on the decisions rendered by Courts across jurisdictions of United Kingdom, United States of America, European Union, Australia, New Zealand, Russia, South Africa, Canada, Spain, Italy, Japan and China; in the cases of Google France SARL and Google Inc. v. Louis Vitton SA & Ors.[1], Interflora Inc. v. Marks & Spencer Plc.[2], and L’Oreal SA v. eBay International AG[3] in support of the contention that the use of trade marks is by the advertiser and not by Google. However, the Division Bench rejected Google’s passive role; highlighting its active involvement in recommending and promoting trademark keywords for higher clicks in its Ads Programme. Division Bench referred to a few judicial decisions rendered in the United States of America that captured the essence of the controversy for perspective, concluding that Google actively promotes and encourages trademarks associated with major goods and services, rather than having a passive role.
It was held that the contention that the use of trademarks as keywords, per se constitutes an infringement of the trademark is unmerited; the assumption that an internet user is merely searching the address of the proprietor of the trademark when he feeds in a search query that may contain a trademark, is erroneous.
The Doctrine of 'Initial Interest Confusion' addresses trademark infringement based on pre-purchase confusion. The doctrine is applied when meta-tags, keywords, or domain names cause initial confusion similar to a registered trademark. If users are misled to access unrelated websites, trademark use in internet advertising may be actionable and reliance was placed on US precedents. Referring to Section 29 of the TM Act, it was directed that Section 29 does not specify the duration for which the confusion lasts but, even if the confusion is for a short duration and an internet user is able to recover from the same, the trade mark would be infringed and would offend Section 29(2) of the TM Act.
It was held that the Ads Programme is a platform for displaying advertisements. Google, being an architect and operator of its own programme makes it an active participant in the use of trademarks and determining the advertisements displayed on search pages. Their use of proprietary software makes them utilize trademarks and control the distribution of information related to potentially infringing links, ultimately leading to revenue maximization. Hence, a substantial link exists between Google LLC and Google India, rendering it impossible for Google India to deny its role in operating the Ads Programme. It was further held that Google sells trademarks as keywords to advertisers and encourages users to use trademarks as keywords for ads. It is contradictory for Google to encourage trademark use while claiming data belongs to third parties for exemption. After 2004, Google changed policies to boost revenue and subsequently, introduced a tool that searches effective terms, including trademarks. Google's active involvement in its advertising business and online nature does not necessarily qualify it for benefits under Section 79 of the IT Act. The Division Bench agreed with the view of the Single Judge that Google would not be eligible for protection of safe harbour under Section 79(1) of the IT Act, if its alleged activities infringe trademarks.
Conclusion
This is a seminal decision governing (and rather, restricting) the operations of intermediaries and redefining the jurisprudence of safe harbour under the IT Act. The decision is well-reasoned and establishes a significant precedent for safeguarding trademarks by uniquely holding Google accountable under its Ads Programme. The same will prevent usage of tradenames as a third-party trademark in keyword search or metatags by advertisers on Google’s search engine. While keywords and meta-tags have different levels of visibility, their purpose is similar i.e. advertising and attracting internet traffic. The use of trademarks as meta-tags by a person who is neither a proprietor of the trademark nor permitted to use the same leads to confusion amongst public at large due to the automated processes of search engines and consequently, constitutes trademark infringement.
About the Authors: Mayank Grover is a Partner and Pratibha Vyas is an Associate at Seraphic Advisors, Advocates & Solicitors
[1] C-236/08 to C-238/08 (2010) [2011] All ER (EC) 41
[2] [2014] EWCA Civ 1403
[3] 2C- 324/09 (2010)
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