Read Order: NARA CHANDRABABU NAIDU v. THE STATE OF ANDHRA PRADESH (In CRIMINAL APPEAL NO. 279 OF 2024 - SC)
Tulip Kanth
New Delhi, January 17, 2024: The Supreme Court has dismissed an appeal of former Andhra Pradesh Chief Minister N Chandrababu Naidu challenging the order rejecting his plea for quashing of FIR registered against him for his involvement in Rs 370 crore Andhra Pradesh Skill Development scam case. However, the Division Bench, comprising Justice Bela M. Trivedi and Justice Aniruddha Bose, expressed divergent views on interpretation of section 17(A) of Prevention Of Corruption Act which postulates prior approval from the appointing authority in relation to any enquiry or investigation.
The appellant was aggrieved by initiation of a criminal proceeding against him and his detention in connection with the same by the respondent State through its CID. Allegations were made against him for commission of offences under Sections 166, 167, 418, 420, 465, 468, 471, 409, 209 and 109 read with Sections 120-B, 34 and 37 of the Indian Penal Code, 1860 and Section 12 and 13(2) read with Sections 13(1)(c) and (d) of the Prevention of Corruption Act, 1988. The said offences are alleged to have been committed between the years 2015 and 2019, during which period he was the Chief Minister of the State of Andhra Pradesh. The offences primarily related to siphoning of public funds
The appellant was arrested and was remanded to judicial custody by the Special Judge. The appellant applied before the High Court for quashing the F.I.R. implicating him. The legality of the remand order was also challenged in the same petition before the High Court. The appellant’s plea was rejected and his petition was dismissed by a Single Judge. The present appeal before the Top Court was against this judgment of dismissal of the said petition.
The primarily allegation against the appellant was facilitating diversion of public money in the approximate range of Rs 370 crores, which was to be used for setting up of six clusters of skill development centres in Andhra Pradesh. The total project cost was conceived to be Rs 3281,05,13,448/- with each of the six clusters costing Rs.546,84,18,908/-. Government contribution was limited to 10 percent of the cost, with SIEMENS and Design Tech providing grant-in-aid of 90% . It was the State’s case that requirement of contribution of the two corporate entities was ignored and the final memorandum of agreement only entailed outflow of Rs.330 crores from the State to Design Tech.
The main complaint against the appellant was that he had fast tracked the project and approved the cost estimation with criminal intent and by pursuing the government officials, he had ensured release of Rs 370 crore. The project was allotted to Design Tech and SIEMENS on nomination basis, without following any tender process. Misappropriation of government funds through corrupt and illegal methods had been alleged and abuse of official position had been attributed to the appellant.
It was noticed by the Bench that the original FIR was registered on 09.12.2021 and the appellant was implicated in the aforesaid offences on 08.09.2023. There was no evidence of any substantive enquiry, inquiry, or investigation made against him prior to coming into operation of the Section 17A of the 1988 Act. On behalf of the appellant, the main argument revolved around the non- compliance of Section 17A in implicating the appellant under Sections 12, 13(2) read with 13(1) (c) and (d) of the 1988 Act and proceeding against him inter-alia, under the aforesaid provisions.
Section 17A states that no police officer shall conduct any enquiry or inquiry or investigation into any offence alleged to have been committed by a public servant under this Act, where the alleged offence is relatable to any recommendation made or decision taken by such public servant in discharge of his official functions or duties, without the previous approval of the Governement or the sanctioning Authority.
Justice Bose was of the view that the point of time Section 17A of 1988 Act would become applicable is the starting point of enquiry, inquiry, or investigation and not the time of commission of the alleged offence. In the event any of the three acts on the part of the prosecution is triggered off post 26.07.2018, the mandate of Section 17A would be applicable. It was observed that if the process of enquiry commences at a time attracting specific provisions of the 1988 Act which stand deleted by the Amendment Act of 2018, the restrictive protection in form of Section 17A ought to be granted.
“The said section, however, as I have already narrated, had become operational when the enquiry started. Thus, proceeding on the basis that the said provision is prospective in its operation, the material point of time for determining its prospectivity would be the starting point of enquiry or inquiry and investigation”, Justice Bose asserted.
It was observed that the offences against the appellant related to the same or similar set of transactions in relation to which the Special Judge was proceeding with the case initiated by the F.I.R. against the other accused persons. Justice Bose opined that the alleged commission of IPC offences were not mere ancillary to the 1988 Act offences and if commission of offences by the appellant under the IPC provisions is proved, could form the basis of conviction independent of the offences under the 1988 Act.
Justice Bose thus held that if an enquiry, inquiry or investigation is intended in respect of a public servant on the allegation of commission of offence under the 1988 Act after Section 17A thereof becomes operational, which is relatable to any recommendation made or decision taken, at least prima facie, in discharge of his official duty, previous approval of the authority postulated in sub-section (a) or (b) or (c) of Section 17A of the 1988 Act shall have to be obtained. In absence of such previous approval, the action initiated under the 1988 Act shall be held illegal.
It was also observed that the appellant cannot be proceeded against for offences under the Prevention of Corruption Act, 1988 as no previous approval of the appropriate authority has been obtained. It was opined that the Special Judge had the jurisdiction to pass an order even if the offences under the 1988 Act could not be invoked at that stage. Lack of approval in terms of Section 17A would not have rendered the entire order of remand non-est, Justice Bose held while also adding that the appellant could be proceeded against before the Special Judge for allegations of commission of offences under the Indian Penal Code.
Justice Trivedi noted that Section 17A bars the police officer from conducting any enquiry or inquiry or investigation of offences relatable to recommendations made or decision taken by public servant in discharge of official functions or duties, without the previous approval of the concerned authorities mentioned therein.
“Section 17A having been introduced as a part of larger legislative scheme, and the other offences under the PC Act having been redefined or newly inserted by way of Amendment Act, 2018, Section 17A is required to be treated as a substantive and not merely a procedural in nature. Such a substantive amendment could not be made applicable retrospectively to the offences like Section 13(1)(c) and 13(1)(d), which have been deleted under the Amendment Act, 2018”, she further held.
Justice Trivedi also noticed that the intention of the legislature was to make Section 17A applicable only to the new offences as amended by Amendment Act, 2018 and not to the offences which existed prior to the coming into force of the Amendment Act 2018.
“Even otherwise, absence of an approval as contemplated in Section 17A for conducting enquiry, inquiry or investigation of the offences alleged to have been committed by a public servant in purported exercise of his official functions or duties, would neither vitiate the proceedings nor would be a ground to quash the proceedings or the FIR registered against such public servant”, Justice Trivedi stated.
Thus, dismissing the appeal, she observed that the Appellant having been implicated for the other offences under IPC also, the Special Court was completely within its jurisdiction to pass the remand order in view of the powers conferred upon it under Section 4 and 5 of the PC Act.
However, considering the fact that both the Judges had expressed different views on the interpretation of Section 17A of the Prevention of Corruption Act, 1988 as also its applicability to the appellant in the subject-case, the Bench referred the matter to the Chief Justice of India.
“The Registry to place the papers before the Hon’ble the Chief Justice of India so that appropriate decision can be taken for the constitution of a Larger Bench in this case for adjudication on the point on which contrary opinions have been expressed by us”, the Top Court ordered.
Read Order: Amit Aggarwal v. Directorate Of Enforcement(In BAIL APPLN. 2073/2023-DEL HC)
Tulip Kanth
New Delhi, January 17, 2024: The Delhi High Court has granted conditional bail to a man who was allegedly instrumental in outward remittance of a huge amount of money in the account of foreign entities on the basis of forged Form 15CB Certificates. The High Court found force in the petitioner’s argument that the unauthorized outward remittance did not amount to 'proceeds of crime' being generated from the scheduled offence of fabrication of such certificates.
The factual background of the case was that an FIR was registered under sections 420/467/468/471/120B of the Indian Penal Code, 1860 (IPC) at Economic Offences Wing (EOW) on the basis of complaint made by Vikash Mohpal in respect of cheating, fraud, forgery stated to be committed by M/s Kinzal Freight Forwarding (OPC) Private Limited, M/s Shree Shyam International, M/s Wentorz Logistics Private Limited, M/s Balaji International, M/s Mizta Tradex Private Limited, Ravi Mehra and other unknown parties.
The complainant, a practicing Chartered Accountant, stated that he received an email from ICICI Bank, Nehru Place Branch informing that CA firm M/s Mohpal & Associates had issued 15CB certificates to M/s Shree Shyam International. The complainant was also summoned by ED and was informed that 15CA/CB certificates issued by using credentials of the complainant had been submitted to banks by the aforementioned companies for effecting outward remittances of approximate Rs 300 crore towards freight payment from the respective bank accounts maintained with ICICI Bank.
The complainant realized that those certificates had been forged with mala fide intention to remit the funds abroad by using forged and fabricated documents and by making wrong declaration regarding the purpose of remittance. The respondent/ED on the basis of information/documents submitted by the complainant found that a prima facie case for an offence of money laundering as per section 3 of PMLA punishable under section 4 of PMLA had been made out. The ED found force in the allegation that the companies remitted crores of rupees using complainant's credentials in edited 15CB certificate and forged Form 15CA with mala fide intention to remit funds abroad which otherwise could not have been possible.
During investigation in this matter, one Chitra Pandey @ Rashmi disclosed/deposed about the role of Amit Aggarwal (petitioner) in the commission of offences and stated that the petitioner used to meet people by the nickname 'Ravi Mehra' and had incorporated bogus/shell companies for effecting fraudulent remittances. The employees were made Directors of the bogus/shell entities used for foreign outward remittances. The petitioner and Rahul Kumar incorporated and operated the companies by using forged IDs for illegal transfer of forex to Hong Kong and Singapore.
The respondent/ED issued various summons to the petitioner to join investigation but the petitioner evaded the same. The petitioner was found to be the main accused for the offence of money laundering under investigation and had failed to cooperate in the investigation. The bail application before the Delhi High Court was filed under section 438 of the Code of Criminal Procedure, 1973 on behalf of the petitioner Amit Aggarwal for grant of anticipatory bail in the case registered under sections 3 and 4 of the PMLA.
In the present case main allegation of the respondent/ED against the petitioner was that he was instrumental in outward remittance of huge amount in the account of foreign entities on the basis of forged Form 15CB Certificates. However, the Single-Judge Bench of Justice Sudhir Kumar Jain opined that there was no property which was derived or obtained directly or indirectly as a result of criminal activity concerning the scheduled offence which could be regarded as 'proceeds of crime'.
“There is legal force in the arguments advanced by the counsel for the petitioner that the unauthorized outward remittance by forged Form 15CB Certificates does not amount to 'proceeds of crime' being generated from the scheduled offence i.e. fabrication of Form 15CB Certificates”, the Bench said.
The CGSC had argued that statements of witnesses/accused recorded under section 50 of PMLA are admissible evidence and can be relied on against the petitioner. Referring to the judgments in Vijay Agrawal through Parokar V Directorate of Enforcement & Basant Bansal V State (Govt. of NCT of Delhi) and Others, the Bench said,“…legal position which is emerging from above referred decision is that statements of witnesses/accused recorded under section 50 of PMLA are admissible in evidence and can make formidable case against the accused regarding his involvement in commission of offence of money laundering but their exact evidentiary value has to be tested at the end of trial and not at the stage of bail.”
While noting that the medical records/documents submitted by the petitioner reflected that the petitioner was suffering from various ailments including renal problem which required constant medical treatment, the Bench referred to Kewal Krishan Kumar V Enforcement Directorate, where the High Court had granted bail on ground of sickness and infirmity of the accused.
It was also opined that the petitioner joined investigation on 03.01.2023 and 04.01.2023 and gave reasons for not joining investigation. According to the High Court, the petitioner neither appeared to be a flight risk, nor he was likely to influence any witness and tamper with the evidence. In view of such discussions and after considering all facts, including incriminating material against the petitioner which were the statements made by co-accused/witness under section 50 of PMLA, the Bench opined that their evidentiary value could be tested at the stage of trial.
Moreover, noticing the fact that there was no generation of 'proceeds of crime' from criminal activity and the petitioner is a sick and infirm person, the Bench allowed the anticipatory bail application. “The petitioner, in case of arrest, shall be released on bail on furnishing personal bond in the sum of Rs 1,00,000 lakh”, the Bench held while also imposing additional conditions.
Read Order: KINADHAN CHAKMA v. UNION OF INDIA & ORS(In W.P.(CRL) 1950/2023-DEL HC)
Tulip Kanth
New Delhi, January 17, 2023: In a case where a Bangladeshi citizen was allegedly found travelling on the basis of an Indian passport which he had fraudulently procured, the Delhi High Court has dismissed the petition of Habeas Corpus with the finding that his liberty hadn’t been curtailed in an illegal manner.
The Division Bench of Justice Suresh Kumar Kait and Justice Manoj Jain was considering a writ petition filed under Article 226 of the Constitution of India read with Section 482 Code of Criminal Procedure, 1973 with a prayer to issue appropriate order for producing Shri Azal Chakma by invoking the Writ of Habeas Corpus.
The admitted facts as put forth by the petitioner was Azal Chakma was born in and brought up in India by his mother, who had earlier solemnized marriage in India with Uttam Kumar who had come to India from Bangladesh in 1986. According to petitioner, Azal Chakma had acquired Indian citizenship by birth and he had his initial education also in Gomati, Tripura and later on in Shilong, Meghalaya. It was averred that he lived in India all his life except for a very brief period and he is holding Indian Passport, AADHAR Card, PAN Card, driving licence issued by Indian authorities and has been running business at Kolkata.
The Bench noticed that Azal Chakma had been detained as he was allegedly found travelling on the basis of Indian Passport which he had, as alleged, fraudulently procured. “As noted, such passport has already been revoked. Documents collected by the respondents clearly indicate that he was holding Bangladeshi Passport and had come to India multiple times on the basis of such passport. When he had applied for visa, he claimed himself to be a Bangladeshi national by birth and also claimed that his parents were also Bangladeshi citizens”, the Bench further noted.
The Petitioner had also not given any response to the aforesaid documents and the passport issued to him by the Bangladeshi authorities. He had also failed to apprise as to how and when he entered India after he had gone to Dhaka on the basis of Bangladeshi passport.
Referring to the Citizenship Act, 1955 as well as the Foreigners Order, 1948, the High Court stated that there was nothing on record which indicated that detention was illegal or without any authority. The Bench also took into consideration the decision of the Magistrate dismissing application under Section 97 Cr.P.C. and observing that alleged confinement of Azal Chakma did not amount to any offence .
“We have already noted above that passport issued to him by Indian authorities has already been revoked as he was suspected Bangladeshi national who had obtained Indian Passport in a fraudulent manner”, the Bench said while adding, “We may also note that foreign national cannot claim that he has right to reside and settle in India in terms of Article 19 (1) (e) of Constitution of India.”
The Bench also referred to Hans Muller of Nurenburg Vs. Superintendent, Presidency Jail, Calcutta [LQ/SC/1955/15] wherein it has been observed that the power of the Government of India to expel foreigners is absolute and unlimited and there is no provision in the Constitution fettering such discretion. Fundamental Right of any such foreigner or suspected foreigner is limited to the one declared under Article 21 of Constitution of India i.e. Fundamental Right for life and liberty and there was nothing which would suggest that his liberty had been curtailed in an illegal or unlawful manner.
It was also highlighted by the Bench that this was not a case of preventive detention as his movements had been restricted in accordance with law so that he could be deported back.
On the contention that the petitioner couldn’t be deported unless his Indian Citizenship was terminated, the Bench stated, “…we hold that even such contention is without any substance. As per his own admission made before the Bangladeshi authorities when he had applied for visa for India way back in the year 2010 and 2011, he claimed himself to be a Bangladeshi national by birth and in such a situation, there is no question of termination of his alleged Indian citizenship which he never seemed to have acquired.”
Thus, without finding any substance in the petition, the Bench dismissed the same.
Read Order: ASMA LATEEF & ANR v. SHABBIR AHMAD & ORS
Tulip Kanth
New Delhi, January 16, 2024: The Supreme Court has clarified that all Civil Courts in the country have to regulate their judicial work in accordance with the terms of provisions of the Civil Procedure Code(CPC). Any egregious breach or violation of such provisionswould be ultra vires.
The facts of the case were that the appellants claimed that their great-grandmother had orally gifted them a certain property (suitproperty) whereafter a memorandum recording the same was also executed before the relevant tehsildar and they were in peaceful possession of the same continuously.Appellants, as plaintiffs, through their power of attorney holder, instituted a civil suit before the Trial Court under section 38 of the Specific Relief Act, 1963 against three defendants - a son of Khatoon Jannat Bibi named Asad Ullah Kazmi [defendant no. 1], Kazmi’s son Samiullah [defendant no. 2] and one purported caretaker [defendant no. 3]. Appellants prayed for a permanent injunction against the three defendants from interfering with the appellants’ peaceful possession of the suit property.
The Trial Court directed Kazmi and Samiullah not to interfere with the appellants’ peaceful possession. Upon the appellants moving an application under Rules 5 and 10 of Order VIII, CPC for pronouncement of judgment against Samiullah, the same was allowed by the Trial Court. Kazmi passed away in 1995, after which his sons transferred the suit property to the respondents 1 to 3 (Purchasers) vide a sale deed. The Suit against Kazmi was finally dismissed as abated.
Appellants, as purported decree holders, filed an execution application. The Executing Court restrained the Purchasers from interfering in any manner with the suit property.Respondents 1 to 3 had filed an objection under section 47 of the Code of Civil Procedure, 1908 (CPC) in an execution application filed by the appellants and the same was allowed resulting in dismissal of the execution application.
A revision was carried by the appellants and the Revisional Court directed the Executing Court to proceed with the execution of the decree whilst treating such objection as non-maintainable.The revisional order was challenged by the respondents and the High Court relegated the parties to the remedy of having their rights adjudicated by the appropriate forum.This is how the appellants reached the Top Court challenging the said judgment and order of the High Court.
The appellants contended that the High Court fell into error by not appreciating the fact that the Executing Court exceeded its jurisdiction by going behind the order dated 5th August, 1991 and the decree that was drawn up in terms thereof, returning a finding that the same was not executable. It was submitted that the reliance placed by the High Court on Balraj Taneja v. Sunilwas misplaced.
The 3-judge Bench of Justice B.R. Gavai, Justice Dipankar Datta & Justice Aravind Kumar noted that the Trial Court was presumed to be aware of the fact that the written statement of Kazmi was on record or else it would not have fixed the next date for settling issues. The Bench opined that the High Court rightly observed that even on pronouncement of judgment against Samiullah, the lis remained alive as against Kazmi and decision on the objection as to maintainability could have resulted in a contrary decision.
“No tribunal, far less a civil court, in exercise of judicial power ought to play ducks and drakes with the rights of the parties”, the Bench said while observing, “We are constrained to observe that it is to avoid such a situation of contradictory/inconsistent decrees that power under Rule 10 of Order VIII ought to be invoked with care, caution, and circumspection, only when none of several defendants file their written statements and upon the taking of evidence from the side of the plaintiff, if deemed necessary, the entire suit could be decided.”
One of the main issues before the Bench was whether the decree drawn up on the basis of the order dated 5th August, 1991 and put to execution by the appellants could have been objected to by the respondents 1 to 3 as inexecutable under section 47, CPC.
Section 47, CPCmandates that an executing court shall determine all questions arising between the parties to the suit or their representatives in relation to the execution, discharge, or satisfaction of the decree and that such questions may not be adjudicated in a separate suit.It was observed by the Top Court that the legality of the order of the High Court, together with the order of the Executing Court that the former went on to uphold, had to be tested bearing in mind that the powers of an executing court, though narrower than an appellate or revisional court, can be exercised to dismiss an execution application if the decree put to execution is unmistakably found to suffer from an inherent lack of jurisdiction of the court that made the same rendering it a nullity in the eye of law.
The Bench proposed to hold that the Executing Court and the High Court were right in holding that the objection raised by the respondents 1 to 3 to the executability of the decree was well-founded. Further, referring to Order VII &Order XIV, CPC, the Bench observed, “It must be remembered that a plaint in a suit is not akin to a writ petition where not only the facts are to be pleaded but also the evidence in support of the pleaded facts is to be annexed, whereafter, upon exchange of affidavits, such petition can be decided on affidavit evidence. Since facts are required to be pleaded in a plaint and not the evidence, which can be adduced in course of examination of witnesses, mere failure or neglect of a defendant to file a written statement controverting the pleaded facts in the plaint, in all cases, may not entitle him to a judgment in his favour unless by adducing evidence he proves his case/claim.
The Top Court also clarified that a decision rendered by a court on the merits of a controversy in favour of the plaintiff without first adjudicating on its competence to decide such controversy would amount to a decision being rendered on an illegal and erroneous assumption of jurisdiction and, thus, be assailable as lacking in inherent jurisdiction and be treated as a nullity in the eye of law. As a logical corollary, it was held that the order dated 5th August, 1991 was ab initio void and the decree drawn up based thereon was inexecutable.
Referring to Balraj Taneja(Supra), the Bench concurred with the observation that a judgment, as envisaged in section 2(9), CPC, should contain the process of reasoning by which the court arrived at its conclusion to resolve the controversy and consequently to decree the suit.
As per the Bench, the examination of the order dated 5th August, 1991 did not reveal any adjudication leading to determination of the rights of the parties in relation to any of the matters in controversy in the suit and, therefore, the decree since drawn up was not a formal expression of an adjudication/determination since there had been no adjudication/determination so as to conform to the requirements of a decree within the meaning of section 2(2). Thus, the Bench expressedits concurrence with both the High Court and the Executing Court that there was no decree at all in the eye of law.
“We, therefore, hold that a decree that follows a judgment or an order (of the present nature) would be inexecutable in the eyes of law and execution thereof, if sought for, would be open to objection in an application under section 47CPC.”, it held while also adding that the Trial Court had no authority to decree the suit against Samiullah in exercise of its power under Rule 10 of Order VIII, CPC.
Thus, upholding the judgment of the High Court, the Bench asked that the determination of the title to the suit property, adjudication on the validity of the sale deed in favour of the Purchasers, or decision on any other contentious issue would be left open for a forum of competent jurisdiction to embark upon, if approached by any of the parties.
Read Order: VIPUL JAIN v. STATE THROUGH GOVT OF (NCT) OF DELHI & ANR
LE Correspondent
New Delhi, January 16, 2023: The Delhi High Court has refused to accept the plea of anticipatory bail of a man, allegedly working in a Finance Company, for producing forged document before the Police and demanding the possession of a car which the complainant had taken on loan.
The Single-Judge Bench of Justice Navin Chawla was considering an application filed under Section 438 of the Code of Criminal Procedure, 1973 seeking anticipatory bail in a case registered under Sections 420/467/468/471/506/34 of the Indian Penal Code (IPC).
The FIR, in question, was registered on a complaint filed by one Sh.Yogesh Sharma, who had stated that he had taken a loan from Kogta Finance Bank (Finance Company) for purchasing a Maruti Suzuki Eeco. He admitted that the loan was to be repaid in 24 instalments, however, he had paid only 4 of the said instalments. He alleged that he had stopped making payments of further instalments as proper receipt of payment made was not being issued to him.
The complainant stated that on 11.09.2023, three unknown persons from the Finance Company, one of whom the prosecution alleged was the petitioner herein, came along with a female and a male Police Officer, and started quarreling with the complainant and snatching the keys of the car from him. They were asked to produce the authority on the basis of which they were demanding the possession of the car, however, they did not have any order from any Court.
It was later discovered that they had produced a fabricated and forged paper purporting itself to be an order passed by an Arbitrator in an arbitration proceeding authorizing them to take the possession of the car.
The applicant contended that the allegations of misbehavior were made only against the two Police Officers and not against the applicant. It was further submitted that the complaint itself recorded that the persons who had visited the complainant were not in the possession of any Court order.It was the applicant’s case that instead of taking action against the erring Police Officers, he was being falsely involved in the present case.
On the contrary, the State Counsel submitted that it was the applicant who produced the alleged forged arbitration order to the Police, and an entry in this regard was also made in the diary. It was on that basis that the Police Officers were made to accompany the applicant to recover the car from the complainant.
The Bench opined that the complainant himself may have been guilty of not having paid the instalments in accordance with the Loan Agreement with the Finance Company, however, the recovery of the vehicle could only be made in accordance with the law.
“Forging an order, may be of an alleged arbitrator, is a serious offence”, the Bench said while further noting that the allegation against the applicant was that he had produced before the Police, a forged and fabricated Order purportedly passed in an arbitration proceeding.
Though the applicant denied this allegation, the Bench observed that it would require a detailed investigation by the police. “Even otherwise, as to who fabricated this purported order, needs to be investigated and ascertained. The presence of the applicant at the spot would also require investigation. This may require the applicant to be confronted with other witnesses”, the Bench said.
“Merely because no action has been taken against the erring Police Officers, in my view, the same cannot be a reason for granting anticipatory bail to the applicant at this stage of the investigation”, the Bench concluded while dismissing the petition.
Read Order: LEISHANGTHEM I LOYANGAMBA v. STATE
Tulip Kanth
New Delhi, January 16, 2024: While observing that no general directions have been given to the Courts to release the accused persons on default bail if the chargesheet is filed without an FSL report, the Delhi High Court has rejected the bail plea of a man booked under the NDPS Act.
The facts of the case were that a secret information was received by the Special Cell that in next 4-5 days, two people from Imphal, Manipur would be carrying drugs from Manipur for supplying them in areas of Delhi NCR and Punjab. On 17.02.2023, the Special Cell had received information that at around 3-4 PM, two residents of Imphal i.e. Ranbir Singh and Loyangamba (applicant), who are involved in business of heroin, will come through loop road from MB road towards Sarita Vihar, Delhi in white coloured Maruti Brezza Car. Thereafter, a raiding team was formed and at around 03:25 PM, the said car had reached the spot and had stopped on the side of road. Accused Ranbir Singh i.e. the driver of the car had then got down from the car and stood on the footpath carrying a bag on his shoulder. Immediately thereafter, the raiding team apprehended the accused, and then the present applicant who was sitting in the car, with a black coloured bag with HP logo, had also started running, but he was captured by the raiding team.
After complying with statutory provisions, the raiding team had conducted search of the car and the bags being carried by the accused persons, and 10kg of opium each was recovered from the bags being carried by the accused persons and 30kg of opium was recovered from the car. Accordingly, the present FIR was registered, accused persons were arrested, and were sent to police remand.
It was the case of the accused-appellant that the chargesheet in this case was filed without an FSL Report, which was considered as main focal point of prosecution in a case under NDPS Act. It was stated that since FSL report was not filed along with the chargesheet, the chargesheet in such a case would be considered as 'incomplete' and thus, the applicant would be entitled to default bail.
It was also submitted that the Apex Court in several recent decisions, including in Mohd Arbaz & Ors. v. State of NCT of Delhi, has granted bail to accused persons in cases where FSL report was not filed alongwith main chargesheet within a period of 180 days.
Referring to the abovementioned judgment, the Sate Counsel stated that till the issue in question i.e. whether a charge-sheet filed without FSL report is complete or incomplete for the purpose of default bail is decided by the Apex Court, the prevailing law would cover the present case and the petitioner would not be entitled to grant of default bail.
The application in question had been filed seeking default bail on the ground of non-filing of FSL report alongwith the chargesheet, and the main grievance of applicant was that the Special Judge had erroneously declined the relief of default bail to him.
The single-judge Bench of Justice Swarana Kanta Sharma placed reliance upon its judgment in Arif Khan v. State (NCT of Delhi) whereby it has been held by that non-filing of FSL report alongwith the chargesheet does not fall within the ambit of Section 173(2) of Cr.P.C. so as to consider it as incomplete chargesheet and accordingly, no right of default bail is accrued in favour of the accused.
The Bench observed that though in case of Mohd Arbaz (supra), as well as in other subsequent cases filed assailing the orders of refusal of grant default bail, the accused persons have been enlarged on bail by the Apex Court, however the said relief however has been granted to the accused persons on the ground of pendency of larger issue i.e. whether chargesheet filed without an FSL report is incomplete chargesheet, before the Apex Court in batch of petitions.
“However, neither the decisions challenged before the Hon'ble Apex Court have been stayed, nor any general directions have been given to the Courts to release the accused persons on default bail if the chargesheet is filed without an FSL report”, the Bench held while dismissing the application.
Read Order: ANJUM ARA v. THE STATE OF BIHAR AND OTHERS
LE Correspondent
New Delhi, January 16, 2024: While reinstating the appellant to the post of Anganwari Sevika, the Supreme Court has held that the appellant was not required to challenge the validity of Clause 4.9 of the Anganwari Sevika Guidelines, 2011 when they have already been struck down by the Patna High Court.
The Division Bench of Justice B.R. Gavai and Justice Sandeep Mehta was considering an appeal challenging the judgment passed by the Division Bench of the Patna High Court in Letters Patent Appeal thereby dismissing the appeal filed by the present appellant.
The facts of the case which led to the filing of the appeal was that in the year 2012, District Programme Officer, Katihar published a notice for selection of Anganwari Workers/Sevika. Pursuant to the said notice, the present appellant as well as respondent No. 8 applied for the said post .The appellant was appointed to the post of Anganwari Sevika in 2013.
Being aggrieved and dissatisfied with the order of appointment issued in favour of the appellant, respondent No.8 submitted a representation before the District Programme Officer praying for cancellation of the order of appointment issued in favour of the appellant. She also prayed for a direction to issue an order of appointment in her favour. The same came to be rejected by the District Programme Officer. The Appellate Authority – Court of Joint Commissioner-cum-Secretary, Regional Transport Authority, Purnea allowed the appeal while setting aside the order of appointment issued in appellant’s favour.
Being aggrieved thereby, the appellant filed a writ petition before the High Court of Judicature at Patna. The Single Judge dismissed the said writ petition. Being aggrieved thereby, the appellant filed LPA before the Division Bench of the High Court. The same was also dismissed vide the impugned order. Hence, the appeal was filed before the Top Court.
It was the appellant’s case that the only ground on which the appellant was held to be disqualified was that her father was a Panchayat Teacher and he was drawing a salary of Rs 6,000 per month. It was submitted that Clause 4.9 of Anganwari Sevika Guidelines, 2011 which imposed certain restrictions, was found to be in violation of Articles 14 and 16 of the Constitution of India by the High Court vide an order passed in CWJC No. 13210 of 2014. It was submitted that, however, this had been ignored by the learned Division Bench.
The Apex Court was of the opinion that both the Single Judge and the Division Bench had grossly erred in dismissing the writ petition as well as LPA filed by the appellant.
Clause 4.9 of the 2011 Guidelines imposed a restriction on such persons whose family member or members had secured appointment with the State Government or any organization of the State. The said Clause came to be challenged before the High Court and the same was struck down.
“The only ground on which the appellant has been nonsuited was that the appellant had not challenged the said Clause 4.9 of the 2011 Guidelines before the High Court. We find that the reasoning as adopted by the learned Division Bench is totally unsustainable”, the Bench said.
The Apex Court was of the view that when the said Clause was struck down by the High Court, it ceased to exist. As such, it was not necessary for the appellant to challenge the validity of the same inasmuch as the same was already held to be invalid by the very same High Court.
Thus, holding that the judgments and orders passed by the Single Judge as well as the Division Bench were not sustainable in law.
Read Order: SURESH GARODIA v. THE STATE OF ASSAM AND ANOTHER
Tulip Kanth
New Delhi, January 16, 2024: The Supreme Court has quashed an FIR registered under section 376 of IPC after noting that the relationship between the accused and the victim was consensual and no explanation was given regarding the late filing of the FIR. The Top Court also observed that the child, who was born out of the said relationship, had been treated by the accused as his own son and all the facilities had been provided to him.
The appellant had approached the Top Court being aggrieved by the order passed by the Single Judge of the Gauhati High Court, dismissing the application filed by the appellant under Section 482 of the Criminal Procedure Code, 1973 for quashing of criminal proceedings under Sections 376/506 of the Indian Penal Code, 1860 (IPC) & for quashing of the order of the Magistrate for taking cognizance under Section 376/506 of IPC.
The factual background of this case was that the prosecutrix lodged a First Information Report alleging that when she was fifteen years of age, the appellant committed rape on her and as a result of which she gave birth to a child. After a final report came to be filed, the Magistrate directed that the cognizance be taken on the basis of the police report. Being aggrieved thereby, the appellant filed a petition under Section 482 Cr.P.C. before the High Court, which was rejected vide the impugned order.
It was the appellant’s case that the FIR was filed after 34 years only in order to blackmail the appellant and therefore, the order passed by the Magistrate dated for taking cognizance was not sustainable in law.
The complainant submitted that prima facie the statement of the prosecutrix had to be taken on face value. It was submitted that since the de facto complainant stated in the FIR that she was a minor at the time of the commission of offence, even if it is said to be consensual, the offence under Section 376 IPC would be made out.
After a perusal of the records, the Division Bench of Justice B.R. Gavai and Justice Sandeep Mehta observed that the son of the prosecutrix admitted that the appellant herein was providing cash money and other facilities to him as his son. The final report stated that only on account of greed for property of the appellant Suresh Garodia, the prosecutrix, in connivance with her son, had filed the FIR after a period of 34 years. The I.O. also opined that the case was of a civil nature and therefore the appellant herein should be discharged from the said case.
“No doubt that the learned Magistrate, while exercising his powers under Section 190 Cr.P.C., is not bound to accept the final report of the I.O. However, if the learned Magistrate disagrees with the finding of the I.O., the least that is expected of him is to give reasons as to why he disagrees with such a report and as to why he finds it necessary to take cognizance despite the negative report submitted by the I.O. Nothing of that sort has been done by the learned Magistrate in his order dated 4th July 2017”, the Bench stated.
“We find that lodging a case after 34 years and that too on the basis of a bald statement that the prosecutrix was a minor at the time of commission of offence, could itself be a ground to quash the proceedings. No explanation whatsoever is given in the FIR as to why the prosecutrix was keeping silent for a long period of 34 years. The material on record shows that the relationship was consensual, inasmuch as the son who is born out of the said relationship has been treated by the appellant as his son and all the facilities, including cash money, have been provided to him”, the Bench opined.
The Top Court also held that the finding of the I.O. that the case was filed only for the greed for the property of the appellant herein couldnot be said to be erroneous.
“We find that the continuation of the proceedings would lead to nothing else but an abuse of process of law”, the Bench held while setting aside the orders and allowing the appeal.
Read Order: RAVI KAPOOR v. STATE-NCT OF DELHI
LE Correspondent
New Delhi, January 16, 2023: The Delhi High Court has rejected the parole request of a murder convict after considering the fact that 41 major punishments had been imposed on him and no document or material had been placed on record in order to substantiate the claim of undergoing a knee surgery.
The Single-Judge Bench of Justice Swarana Kanta Sharma was considering a plea of Ravi Kapoor, who has currently been serving his life sentence, seeking parole for a period of four weeks since he continued to remain in jail for more than 14 years. The petitioner sought parole on the ground of maintaining social ties with his family and for undergoing a knee surgery.
The facts of the case suggested that the petitioner has been currently confined in Central Jail, Mandoli, Delhi, in a case arising out of an FIR in which he was sentenced to death for offence under Section 302 of Indian Penal Code, 1860 (IPC), rigorous imprisonment for life for offence under Section 364 and 394 of IPC, simple imprisonment for seven years for offence under Sections 201 and 468 of IPC, two years of simple imprisonment for offence under Section 471 of IPC, and one year of simple imprisonment for offence under Section 25 of Arms Act. In 2018, the High Court had commuted the death sentence awarded to the petitioner under Section 302 of IPC to life imprisonment.
A writ petition was filed in October, 2023, raising a grievance that the application seeking parole filed by the petitioner before the competent authority in July, 2023 had not been decided, despite lapse of more than two months and in view thereof, he had to first approach the High Court by way of an earlier petition which was disposed of on the submissions made on behalf of State that the application filed by the petitioner before the competent authority would be decided within a period of two weeks. However, it was the case of petitioner that since the competent authority had again failed to decide the application filed by the petitioner seeking parole, he was then compelled to approach this Court through the present writ petition.
It was noticed by the Bench that though the nominal role reflected that the jail conduct of the petitioner since the year 2017 had remained satisfactory, however, between the period 2010 to 2017, the petitioner had been awarded 41 major punishments in respect of different categories of offences committed by the petitioner within the jail premises.
The petitioner had been involved in 20 other criminal cases including cases pertaining to commission of offences of murder robbery, theft as well as offences under Arms Act, etc. The Bench noticed that the petitioner herein, as on date, stood convicted in two cases involving offence under Section 302 of IPC, for which he had been awarded rigorous imprisonment for life. The most recent conviction was the one under 302 of IPC as well as MCOCA wherein it was alleged that the petitioner along with co-accused persons had shot and killed a journalist, in September, 2008, with the motive of committing robbery. The conviction of the petitioner in one of the cases also related to an FIR in which he along with co-accused persons had abducted one woman in a car and thereafter, they had robbed her off her belongings. Allegedly, they had smothered her to death and then dumped her body in bushes near Surajkund, Faridabad.
Considering the fact that the parole had not been sought on grounds of any exigency in the family of petitioner but for the purpose of maintaining social and family ties, the Bench noted that neither any document or material in support of undergoing a knee surgery had been placed on record.
“When this Court examines the factual matrix of the present case, on the touchstone of the aforesaid principles laid down and observations made by the Hon’ble Apex Court, this Court notes that the petitioner herein is a habitual offender, who has been involved in about 20 criminal cases between the period 2002 to 2010, and has been convicted in two cases involving commission of offences such as murder and robbery, and the most recent conviction being in October, 2023. Though his conduct inside jail remains satisfactory for last few years, the overall jail conduct has been unsatisfactory owing to as many as 41 major punishments being awarded to him”, the Bench said.
Thus, dismissing the petition, the Bench rejected the plea of grant of parole.
Read Order: THE STATE OF HIMACHAL PRADESH AND OTHERS v. YOGENDERA MOHAN SENGUPTA AND ANOTHER
Tulip Kanth
New Delhi, January 16, 2024: The Supreme Court has given a go ahead to the Himachal Pradesh Government to implement the Development Plan, 2041. The Top Court observed that there are sufficient safeguards to balance the need for development while taking care of and addressing the environmental and ecological concerns.
The facts of the case suggested that a draft development plan for 22,450 hectares of Shimla Planning Area (SPA) which was finalized vide a notification dated 16th April 2022, came to be stayed by the NGT, vide an interim order dated 12th May 2022. By the said order, it restrained the appellants herein from taking any further steps in pursuance of the draft development plan of the SPA.
The State of Himachal Pradesh and its instrumentalities-appellants herein preferred Civil Writ Petition. Despite the pendency of the said writ petition, the NGT, vide its final order dated 14th October 2022 (second order of NGT) held that the draft development plan, being in conflict with the first order of NGT, was illegal and cannot be given effect to.
Thereafter by an amendment in the petition, the second order of NGT also came to be challenged before the High Court of Himachal Pradesh. Thereafter, an order was passed to transfer the said case from the High Court of Himachal Pradesh to the Top Court. The State approached the Top Court challenging the first order of NGT and the order passed by the NGT in Review Application.
At the outset, the Division Bench of Justice B.R. Gavai and Justice Aravind Kumar clarified that Chapter-IV of the Himachal Pradesh Town & Country Planning Act, 1977 is a complete code, providing for preparation of draft development plan, publication of draft development plan with a publication of its notice, inviting objections and suggestions, giving reasonable opportunity to all persons affected of being heard, making modifications in the draft development plan as may be considered necessary by the Director and thereafter submitting it to the State Government.
It was also opined that the powers vested with the Director and the State Government are for enacting a piece of delegated legislation. Reiterating that that the exercise of power for the preparation, finalization and approval of development plan is a power exercised by the delegatee for enacting a subordinate piece of legislation, the Bench opined that the TCP Act provides for exercise of power by a delegatee to enact a piece of subordinate legislation.
The Bench was of the opinion that the first order of NGT was liable to be set aside on the short ground that it had transgressed its limitations and attempted to encroach upon the field reserved for the delegatee to enact a piece of delegated legislation. “We are of the considered view that when the TCP Act empowers the State Government and the Director to exercise the powers to enact a piece of delegated legislation, the NGT could not have imposed fetters on such powers and directed it to exercise its powers in a particular manner”, it said.
Moreover, the Top Court made it clear that the continuation of the proceedings by the NGT during the pendency of the writ petitions before the High Court was not in conformity with the principles of judicial propriety. Despite pendency of the proceedings before the High Court including the one challenging the interim order passed by NGT, the NGT went ahead with the passing of the second order impugned herein.
“It is thus clear that while ensuring the developmental activities so as to meet the demands of growing population, it is also necessary that the issues with regard to environmental and ecological protection are addressed too”, it said.
The Top Court further opined that there are sufficient safeguards to balance the need for development while taking care of and addressing the environmental and ecological concerns. It was also considered by the Bench that the development plan has been finalized after various experts from various fields including those concerned with urban planning, environment etc., were taken on board. It was finalized undergoing the rigorous process including that of inviting objections and suggestions at two stages, giving the hearing to such objectors and suggesters and after considering the same.
“If any of the citizen has any grievance that any provision is detrimental to the environment or ecology, it is always open to raise a challenge to such an independent provision before the appropriate forum. Such a challenge can be considered in accordance with law. But, in our view, the development plan, which has been finalized after taking recourse to the statutory provisions and undergoing the rigors thereto, cannot be stalled in entirety thereby putting the entire developmental activities to a standstill”, the Bench highlighted.
Thus, setting aside the orders of the NGT, the Bench held, “The appellant-State of Himachal Pradesh and its instrumentalities are permitted to proceed with the implementation of the development plan as published on 20th June 2023 subject to what has been observed by us hereinabove.”
Read Order: BIRLA CORPORATION LIMITED THROUGH ITS MANAGING DIRECTOR v. BHANWAR SINGH AND OTHERS
Tulip Kanth
New Delhi, January 15, 2024: While observing that Rajasthan’s Chittorgarh Fort, a heritage monument, must be maintained and preserved under all the circumstances, the Top Court has held that a radius of five kilometres from the compound wall of the Fort shall not be subjected to mining by blasting or use of explosives for mining of any minerals.
The matter, before the Division Bench of Justice Sanjiv Khanna and Justice S.V.N. Bhatti, revolved around the Chittorgarh Fort which is a notified monument and also a notified UNESCO World Heritage Site. The State Government granted prospective mining leases of small, medium and large areas in and around the hillock and the surrounding areas of the Chittorgarh Fort to individuals/industrial houses.
One Shri Thakur Umed Singh Rathore filed a PIL before the High Court of Rajasthan, questioning the blasting operations undertaken for limestone extraction resulting in possible damage to the existing structures of the Chittorgarh Fort. The gist of the complaint was that continuous/frequent exposure of the ancient structures in the Chittorgarh Fort to the peak particle velocity (PPV) generated by the explosives used in mineral extraction would damage the heritage monument, and this negligence of the present generation would leave only the remnants of the Chittorgarh Fort to the succeeding generations.
After this petition was disposed of, the other Respondents also filed a PIL before the High Court of Rajasthan against the Union of India through Archaeological Survey of India (ASI)/Respondent No. 7 and others with the prayer to protect the Fort & stop blasting within a radius of ten kilometres from the Fort.
Disposing of this PIL, the Court had directed that no mining activities and blasting would take place within 10 kms from the fort wall. The mining leases granted within 10 kms from fort wall were cancelled. The Birla Cement as well as other mine holders were directed to make payment of compensation to the tune of Rs 5 crore out of which, 90% was to be paid by Birla Cement and the remaining amount had to be paid by other mine holders involved in blasting.
Hence, Petitioner-Birla Cement filed a SLP. The petitioner Company, possessing a mining lease for 598.98 hectares at a distance of about 4.5 kilometres from the boundary of the Chittorgarh Fort, challenged the directions issued by the High Court whereby the Court permitted the study of cumulative impacts of vibrations and peak particle velocity (PPV) on the structures in the Fort from the blasting operations and simultaneously prohibited blasting for any purpose, including the proposed study, within the radius of one kilometre from the boundary of the Chittorgarh Fort.
The Court had also directed the Central Building Research Institute, Roorkee (CBRI), to undertake a comprehensive study of the environmental impact on the subject monument from the mining and blasting activities by the lessees of the mining lease within a radius of ten kilometres.
It was the case of the petitioner that the mining operations undertaken by the it are safe and do not cause a debilitating effect on the structures in the Chittorgarh Fort. It was submitted that the impugned judgement imposed a ban on safe and technical ways of mineral extraction from the mines situated at Jai-Surjana and Block-B (Bherda).
The Bench, at the outset, observed, “Therefore, this Court is of the firm view that the Chittorgarh Fort, a heritage monument, must be maintained and preserved under all the circumstances. The common thread running through the argument of all the Counsel in the steps needed to preserve the Fort are implemented and if need be, this Court issues continuous mandamus from time to time to the authorities.”
The Bench was of the view that the safe minimum distance for blasting operations from the Chittorgarh Fort suggested in the Report of the CSIR- CBRI, Roorkee in all material particulars was not in line with the Report of the Ministry of Coal and Mines, Indian Bureau of Mines, Mining Research Cell.
Despite reports suggesting that blasting operations can be undertaken beyond the safe distance as suggested by the experts would ought not to be given effect unless examined in a detailed study undertaken by exploring the latest techniques and technologies, the Bench held while also adding that the scientific/technological advancements can only be ignored if their efficacy as wanting is established in a study undertaken by a committee constituted by this Court.
“This Court at this stage of consideration ought not to accept the electronic blasting system technique suggested by the Petitioner can be a safe solution to allow mining operations by blasting without a prohibitory radius. By choice, we prefer a third-party institution and experts in this branch of engineering/science to undertake the study independently and file a report before this Court on the aspects discussed above”, the Bench further held.
The Top Court noticed other contributory circumstances viz. negligence causing deterioration to the structures in Chittorgarh Fort. Monkey menace, human/tourist footfall, unwanted vegetation growth, and the defacing of statues have been a few factors recorded in the report that have contributed to the deterioration of the Fort. “The extent of damage to the monument is a serious question. So, the prevention of damage from any such collateral activities must be simultaneously addressed by the State Government of Rajasthan and the ASI”, the Bench said.
In light of such discussions and observations, the Bench issued the following directions-
- The recommendations in the Report dated 30.09.2014 which are directed against ASI and the State of Rajasthan are implemented within two months from the receipt of this Order. For the said purpose, we direct the Union of India, through the Director General, ASI, to file a compliance report on the deficiencies noted in the monument’s maintenance, steps initiated and progress made by the next date of hearing.
- Respondent No. 8 is directed to ensure strict implementation of the Solid Waste Management Rules, 2016. Respondents Nos. 8 and 12 are directed to issue orders within four weeks from today. A report on periodic monitoring and the progress made is filed by Respondent No. 12 for and on behalf of Respondent No. 8.
- The manual/mechanical mining operations permitted within a radius of five kilometres are allowed to be continued, subject to the lessees possessing a valid lease in accordance with law.
- To undertake the study of environmental pollution and impact on all the structures in the Chittorgarh Fort from the blasting operations beyond a five-kilometre radius, the Chairman, Indian Institute of Technology (Indian School of Mines), Dhanbad, Jharkhand [IIT (ISM)- Dhanbad] constitutes an Expert Committee of multi-disciplinary experts.
The Bench concluded the matter by accepting the statement of the Petitioner that in the proposed study, the Petitioner uses an electronic blasting system, and the explosives used for delay shall not exceed the quantity suggested in the Report of Ministry of Coal and Mines, Indian Bureau of Mines, Mining Research Cell.
Time for judiciary to introspect and see what can be done to restore people’s faith – Justice Lokur
Justice Madan B Lokur, was a Supreme Court judge from June 2012 to December 2018. He is now a judge of the non-resident panel of the Supreme Court of Fiji. He spoke to LegitQuest on January 25, 2020.
Q: You were a Supreme Court judge for more than 6 years. Do SC judges have their own ups and downs, in the sense that do you have any frustrations about cases, things not working out, the kind of issues that come to you?
A: There are no ups and downs in that sense but sometimes you do get a little upset at the pace of justice delivery. I felt that there were occasions when justice could have been delivered much faster, a case could have been decided much faster than it actually was. (When there is) resistance in that regard normally from the state, from the establishment, then you kind of feel what’s happening, what can I do about it.
Q: So you have had the feeling that the establishment is trying to interfere in the matters?
A: No, not interfering in matters but not giving the necessary importance to some cases. So if something has to be done in four weeks, for example if reply has to be filed within four weeks and they don’t file it in four weeks just because they feel that it doesn’t matter, and it’s ok if we file it within six weeks how does it make a difference. But it does make a difference.
Q: Do you think this attitude is merely a lax attitude or is it an infrastructure related problem?
A: I don’t know. Sometimes on some issues the government or the establishment takes it easy. They don’t realise the urgency. So that’s one. Sometimes there are systemic issues, for example, you may have a case that takes much longer than anticipated and therefore you can’t take up some other case. Then that necessarily has to be adjourned. So these things have to be planned very carefully.
Q: Are there any cases that you have special memories of in terms of your personal experiences while dealing with the case? It might have moved you or it may have made you feel that this case is really important though it may not be considered important by the government or may have escaped the media glare?
A: All the cases that I did with regard to social justice, cases which concern social justice and which concern the environment, I think all of them were important. They gave me some satisfaction, some frustration also, in the sense of time, but I would certainly remember all these cases.
Q: Even though you were at the Supreme Court as a jurist, were there any learning experiences for you that may have surprised you?
A: There were learning experiences, yes. And plenty of them. Every case is a learning experience because you tend to look at the same case with two different perspectives. So every case is a great learning experience. You know how society functions, how the state functions, what is going on in the minds of the people, what is it that has prompted them to come the court. There is a great learning, not only in terms of people and institutions but also in terms of law.
Q: You are a Judge of the Supreme Court of Fiji, though a Non-Resident Judge. How different is it in comparison to being a Judge in India?
A: There are some procedural distinctions. For example, there is a great reliance in Fiji on written submissions and for the oral submissions they give 45 minutes to a side. So the case is over within 1 1/2 hours maximum. That’s not the situation here in India. The number of cases in Fiji are very few. Yes, it’s a small country, with a small number of cases. Cases are very few so it’s only when they have an adequate number of cases that they will have a session and as far as I am aware they do not have more than two or three sessions in a year and the session lasts for maybe about three weeks. So it’s not that the court sits every day or that I have to shift to Fiji. When it is necessary and there are a good number of cases then they will have a session, unlike here. It is then that I am required to go to Fiji for three weeks. The other difference is that in every case that comes to the (Fiji) Supreme Court, even if special leave is not granted, you have to give a detailed judgement which is not the practice here.
Q: There is a lot of backlog in the lower courts in India which creates a problem for the justice delivery system. One reason is definitely shortage of judges. What are the other reasons as to why there is so much backlog of cases in the trial courts?
A: I think case management is absolutely necessary and unless we introduce case management and alternative methods of dispute resolution, we will not be able to solve the problem. I will give you a very recent example about the Muzaffarpur children’s home case (in Bihar) where about 34 girls were systematically raped. There were about 17 or 18 accused persons but the entire trial finished within six months. Now that was only because of the management and the efforts of the trial judge and I think that needs to be studied how he could do it. If he could do such a complex case with so many eyewitnesses and so many accused persons in a short frame of time, I don’t see why other cases cannot be decided within a specified time frame. That’s case management. The second thing is so far as other methods of disposal of cases are concerned, we have had a very good experience in trial courts in Delhi where more than one lakh cases have been disposed of through mediation. So, mediation must be encouraged at the trial level because if you can dispose so many cases you can reduce the workload. For criminal cases, you have Plea Bargaining that has been introduced in 2009 but not put into practice. We did make an attempt in the Tis Hazari Courts. It worked to some extent but after that it fell into disuse. So, plea bargaining can take care of a lot of cases. And there will be certain categories of cases which we need to look at carefully. For example, you have cases of compoundable offences, you have cases where fine is the punishment and not necessarily imprisonment, or maybe it’s imprisonment say one month or two month’s imprisonment. Do we need to actually go through a regular trial for these kind of cases? Can they not be resolved or adjudicated through Plea Bargaining? This will help the system, it will help in Prison Reforms, (prevent) overcrowding in prisons. So there are a lot of avenues available for reducing the backlog. But I think an effort has to be made to resolve all that.
Q: Do you think there are any systemic flaws in the country’s justice system, or the way trial courts work?
A: I don’t think there are any major systemic flaws. It’s just that case management has not been given importance. If case management is given importance, then whatever systematic flaws are existing, they will certainly come down.
Q; And what about technology. Do you think technology can play a role in improving the functioning of the justice delivery system?
I think technology is very important. You are aware of the e-courts project. Now I have been told by many judges and many judicial academies that the e-courts project has brought about sort of a revolution in the trial courts. There is a lot of information that is available for the litigants, judges, lawyers and researchers and if it is put to optimum use or even semi optimum use, it can make a huge difference. Today there are many judges who are using technology and particularly the benefits of the e-courts project is an adjunct to their work. Some studies on how technology can be used or the e-courts project can be used to improve the system will make a huge difference.
Q: What kind of technology would you recommend that courts should have?
A: The work that was assigned to the e-committee I think has been taken care of, if not fully, then largely to the maximum possible extent. Now having done the work you have to try and take advantage of the work that’s been done, find out all the flaws and see how you can rectify it or remove those flaws. For example, we came across a case where 94 adjournments were given in a criminal case. Now why were 94 adjournments given? Somebody needs to study that, so that information is available. And unless you process that information, things will just continue, you will just be collecting information. So as far as I am concerned, the task of collecting information is over. We now need to improve information collection and process available information and that is something I think should be done.
Q: There is a debate going on about the rights of death row convicts. CJI Justice Bobde recently objected to death row convicts filing lot of petitions, making use of every legal remedy available to them. He said the rights of the victim should be given more importance over the rights of the accused. But a lot of legal experts have said that these remedies are available to correct the anomalies, if any, in the justice delivery. Even the Centre has urged the court to adopt a more victim-centric approach. What is your opinion on that?
You see so far as procedures are concerned, when a person knows that s/he is going to die in a few days or a few months, s/he will do everything possible to live. Now you can’t tell a person who has got terminal cancer that there is no point in undergoing chemotherapy because you are going to die anyway. A person is going to fight for her/his life to the maximum extent. So if a person is on death row s/he will do everything possible to survive. You have very exceptional people like Bhagat Singh who are ready to face (the gallows) but that’s why they are exceptional. So an ordinary person will do everything possible (to survive). So if the law permits them to do all this, they will do it.
Q: Do you think law should permit this to death row convicts?
A: That is for the Parliament to decide. The law is there, the Constitution is there. Now if the Parliament chooses not to enact a law which takes into consideration the rights of the victims and the people who are on death row, what can anyone do? You can’t tell a person on death row that listen, if you don’t file a review petition within one week, I will hang you. If you do not file a curative petition within three days, then I will hang you. You also have to look at the frame of mind of a person facing death. Victims certainly, but also the convict.
Q: From the point of jurisprudence, do you think death row convicts’ rights are essential? Or can their rights be done away with?
A: I don’t know you can take away the right of a person fighting for his life but you have to strike a balance somewhere. To say that you must file a review or curative or mercy petition in one week, it’s very difficult. You tell somebody else who is not on a death row that you can file a review petition within 30 days but a person who is on death row you tell him that I will give you only one week, it doesn’t make any sense to me. In fact it should probably be the other way round.
Q: What about capital punishment as a means of punishment itself?
A: There has been a lot of debate and discussion about capital punishment but I think that world over it has now been accepted, more or less, that death penalty has not served the purpose for which it was intended. So, there are very few countries that are executing people. The United States, Saudi Arabia, China, Pakistan also, but it hasn’t brought down the crime rate. And India has been very conservative in imposing the death penalty. I think the last 3-4 executions have happened for the persons who were terrorists. And apart from that there was one from Calcutta who was hanged for rape and murder. But the fact that he was hanged for rape and murder has not deterred people (from committing rape and murder). So the accepted view is that death penalty has not served the purpose. We certainly need to rethink the continuance of capital punishment. On the other hand, if capital punishment is abolished, there might be fake encounter killings or extra judicial killings.
Q: These days there is the psyche among people of ‘instant justice’, like we saw in the case of the Hyderabad vet who was raped and murdered. The four accused in the case were killed in an encounter and the public at large and even politicians hailed it as justice being delivery. Do you think this ‘lynch mob mentality’ reflects people’s lack of faith in the justice system?
A: I think in this particular case about what happened in Telangana, investigation was still going on. About what actually happened there, an enquiry is going on. So no definite conclusions have come out. According to the police these people tried to snatch weapons so they had to be shot. Now it is very difficult to believe, as far as I am concerned, that 10 armed policeman could not overpower four unarmed accused persons. This is very difficult to believe. And assuming one of them happened to have snatched a (cop’s) weapon, maybe he could have been incapacitated but why the other three? So there are a lot of questions that are unanswered. So far as the celebrations are concerned, the people who are celebrating, do they know for certain that they (those killed in the encounter) were the ones who did the crime? How can they be so sure about it? They were not eye witnesses. Even witnesses sometimes make mistakes. This is really not a cause for celebration. Certainly not.
Q: It seems some people are losing their faith in the country’s justice delivery system. How to repose people’s faith in the legal process?
A: You see we again come back to case management and speedy justice. Suppose the Nirbhaya case would have been decided within two or three years, would this (Telangana) incident have happened? One can’t say. The attack on Parliament case was decided in two or three years but that has not wiped out terrorism. There are a lot of factors that go into all this, so there is a need to find ways of improving justice delivery so that you don’t have any extremes – where a case takes 10 years or another extreme where there is instant justice. There has to be something in between, some balance has to be drawn. Now you have that case where Phoolan Devi was gangraped followed by the Behmai massacre. Now this is a case of 1981, it has been 40 years and the trial court has still not delivered a judgement. It’s due any day now, (but) whose fault is that. You have another case in Maharashtra that has been transferred to National Investigating Agency two years after the incident, the Bhima-Koregaon case. Investigation is supposedly not complete after two years also. Whose fault is that? So you have to look at the entire system in a holistic manner. There are many players – the investigation agency is one player, the prosecution is one player, the defence is one player, the justice delivery system is one player. So unless all of them are in a position to coordinate… you cannot blame only the justice delivery system. If the Telangana police was so sure that the persons they have caught are guilty, why did they not file the charge sheet immediately? If they were so sure the charge sheet should have been filed within one day. Why didn’t they do it?
Q: At the trial level, there are many instances of flaws in evidence collection. Do you think the police or whoever the investigators are, do they lack training?
A: Yes they do! The police lacks training. I think there is a recent report that has come out last week which says very few people (in the police) have been trained (to collect evidence).
Q: You think giving proper training to police to prepare a case will make a difference?
A: Yes, it will make a difference.
Q: You have a keen interest in juvenile justice. Unfortunately, a lot of heinous crimes are committed by juveniles. How can we correct that?
A: You see it depends upon what perspective we are looking at. Now these heinous crimes are committed by juveniles. Heinous crimes are committed by adults also, so why pick upon juveniles alone and say something should be done because juveniles are committing heinous crimes. Why is it that people are not saying that something should be done when adults are committing heinous crimes? That’s one perspective. There are a lot of heinous crimes that are committed against juveniles. The number of crimes committed against juveniles or children are much more than the crimes committed by juveniles. How come nobody is talking about that? And the people committing heinous crimes against children are adults. So is it okay to say that the State has imposed death penalty for an offence against the child? So that’s good enough, nothing more needs to be done? I don’t think that’s a valid answer. The establishment must keep in mind the fact that the number of heinous crimes against children are much more than those committed by juveniles. We must shift focus.
Q: Coming to NRC and CAA. Protests have been happening since December last year, the SC is waiting for the Centre’s reply, the Delhi HC has refused to directly intervene. Neither the protesters nor the government is budging. How do we achieve a breakthrough?
A: It is for the government to decide what they want to do. If the government says it is not going to budge, and the people say they are not going to budge, the stalemate could continue forever.
Q: Do you think the CAA and the NRC will have an impact on civil liberties, personal liberties and people’s rights?
A: Yes, and that is one of the reasons why there is protest all over the country. And people have realised that it is going to happen, it is going to have an impact on their lives, on their rights and that’s why they are protesting. So the answer to your question is yes.
Q: Across the world and in India, we are seeing an erosion of the value system upholding rights and liberties. How important is it for the healthy functioning of a country that social justice, people’s liberties, people’s rights are maintained?
A: I think social justice issues, fundamental rights are of prime importance in our country, in any democracy, and the preamble to our Constitution makes it absolutely clear and the judgement of the Supreme Court in Kesavananda Bharati and many other subsequent judgments also make it clear that you cannot change the basic structure of the Constitution. If you cannot do that then obviously you cannot take away some basic democratic rights like freedom of assembly, freedom of movement, you cannot take them away. So if you have to live in a democracy, we have to accept the fact that these rights cannot be taken away. Otherwise there are many countries where there is no democracy. I don’t know whether those people are happy or not happy.
Q: What will happen if in a democracy these rights are controlled by hook or by crook?
A: It depends upon how much they are controlled. If the control is excessive then that is wrong. The Constitution says there must be a reasonable restriction. So reasonable restriction by law is very important.
Q: The way in which the sexual harassment case against Justice Gogoi was handled was pretty controversial. The woman has now been reinstated in the Supreme Court as a staffer. Does this action of the Supreme Court sort of vindicate her?
A: I find this very confusing you know. There is an old joke among lawyers: Lawyer for the petitioner argued before the judge and the judge said you are right; then the lawyer for the respondent argued before the judge and the judge said you’re right; then a third person sitting over there says how can both of them be right and the judge says you’re also right. So this is what has happened in this case. It was found (by the SC committee) that what she said had no substance. And therefore, she was wrong and the accused was right. Now she has been reinstated with back wages and all. I don’t know, I find it very confusing.
Q: Do you think the retirement age of Supreme Court Judges should be raised to 70 years and there should be a fixed tenure?
A: I haven’t thought about it as yet. There are some advantages, there are some disadvantages. (When) You have extended age or life tenure as in the United States, and the Supreme Court has a particular point of view, it will continue for a long time. So in the United States you have liberal judges and conservative judges, so if the number of conservative judges is high then the court will always be conservative. If the number of liberal judges is high, the court will always be liberal. There is this disadvantage but there is also an advantage that if it’s a liberal court and if it is a liberal democracy then it will work for the benefit of the people. But I have not given any serious thought onthis.
Q: Is there any other thing you would like to say?
A: I think the time has come for the judiciary to sit down, introspect and see what can be done, because people have faith in the judiciary. A lot of that faith has been eroded in the last couple of years. So one has to restore that faith and then increase that faith. I think the judiciary definitely needs to introspect.
‘A major issue for startups, especially during fund raising, is their compliance with extant RBI foreign exchange regulations, pricing guidelines, and the Companies Act 2013.’- Aakash Parihar
Aakash Parihar is Partner at Triumvir Law, a firm specializing in M&A, PE/VC, startup advisory, international commercial arbitration, and corporate disputes. He is an alumnus of the National Law School of India University, Bangalore.
How did you come across law as a career? Tell us about what made you decide law as an option.
Growing up in a small town in Madhya Pradesh, wedid not have many options.There you either study to become a doctor or an engineer. As the sheep follows the herd, I too jumped into 11th grade with PCM (Physics, Chemistry and Mathematics).However, shortly after, I came across the Common Law Admission Test (CLAT) and the prospect of law as a career. Being a law aspirant without any background of legal field, I hardly knew anything about the legal profession leave alone the niche areas of corporate lawor dispute resolution. Thereafter, I interacted with students from various law schools in India to understand law as a career and I opted to sit for CLAT. Fortunately, my hard work paid off and I made it to the hallowed National Law School of India University, Bangalore (NSLIU). Joining NLSIU and moving to Bangalorewas an overwhelming experience. However, after a few months, I settled in and became accustomed to the rigorous academic curriculum. Needless to mention that it was an absolute pleasure to study with and from someof the brightest minds in legal academia. NLSIU, Bangalore broadened my perspective about law and provided me with a new set of lenses to comprehend the world around me. Through this newly acquired perspective and a great amount of hard work (which is of course irreplaceable), I was able to procure a job in my fourth year at law school and thus began my journey.
As a lawyer carving a niche for himself, tell us about your professional journey so far. What are the challenges that new lawyers face while starting out in the legal field?
I started my professional journey as an Associate at Samvad Partners, Bangalore, where I primarily worked in the corporate team. Prior to Samvad Partners, through my internship, I had developed an interest towards corporate law,especially the PE/VC and M&A practice area. In the initial years as an associate at Samvad Partners and later at AZB & Partners, Mumbai, I had the opportunity to work on various aspects of corporate law, i.e., from PE/VC and M&A with respect to listed as well as unlisted companies. My work experience at these firms equipped and provided me the know-how to deal with cutting edge transactional lawyering. At this point, it is important to mention that I always had aspirations to join and develop a boutique firm. While I was working at AZB, sometime around March 2019, I got a call from Anubhab, Founder of Triumvir Law, who told me about the great work Triumvir Law was doing in the start-up and emerging companies’ ecosystem in Bangalore. The ambition of the firm aligned with mine,so I took a leap of faith to move to Bangalore to join Triumvir Law.
Anyone who is a first-generation lawyer in the legal industry will agree with my statement that it is never easy to build a firm, that too so early in your career. However, that is precisely the notion that Triumvir Law wanted to disrupt. To provide quality corporate and dispute resolution advisory to clients across India and abroad at an affordable price point.
Once you start your professional journey, you need to apply everything that you learnt in law schoolwith a practical perspective. Therefore, in my opinion, in addition to learning the practical aspects of law, a young lawyer needs to be accustomed with various practices of law before choosing one specific field to practice.
India has been doing reallywell in the field of M&A and PE/VC. Since you specialize in M&A and PE/VC dealmaking, what according to you has been working well for the country in this sphere? What does the future look like?
India is a developing economy, andM&A and PE/VC transactions form the backbone of the same. Since liberalization, there has been an influx of foreign investment in India, and we have seen an exponential rise in PC/VA and M&A deals. Indian investment market growth especially M&A and PE/VC aspects can be attributed to the advent of startup culture in India. The increase in M&A and PE/VC deals require corporate lawyersto handle the legal aspects of these deals.
As a corporate lawyer working in M&A and PE/VC space, my work ranges from drafting term-sheets to the transaction documents (SPA, SSA, SHA, BTA, etc.). TheM&A and PE/VC deal space experienced a slump during the first few months of the pandemic, but since June 2021, there has been a significant growth in M&A and PE/VC deal space in India. The growth and consistence of the M&A and PE/VC deal space in India can be attributed to several factors such as foreign investment, uncapped demands in the Indian market and exceptional performance of Indian startups.
During the pandemic many businesses were shut down but surprisingly many new businesses started, which adapted to the challenges imposed by the pandemic. Since we are in the recovery mode, I think the M&A and PE/VC deal space will reach bigger heights in the comingyears. We as a firm look forward to being part of this recovery mode by being part of the more M&A and PE/VC deals in future.
You also advice start-ups. What are the legal issues or challenges that the start-ups usually face specifically in India? Do these issues/challenges have long-term consequences?
We do a considerable amount of work with startupswhich range from day-to-day legal advisory to transaction documentation during a funding round. In India, we have noticed that a sizeable amount of clientele approach counsels only when there is a default or breach, more often than not in a state of panic. The same principle applies to startups in India, they normally approach us at a stage when they are about to receive investment or are undergoing due diligence. At that point of time, we need to understand their legal issues as well as manage the demands of the investor’s legal team. The majornon-compliances by startups usually involve not maintaining proper agreements, delaying regulatory filings and secretarial compliances, and not focusing on proper corporate governance.
Another major issue for startups, especially during fund raising, is their compliance with extant RBI foreign exchange regulations, pricing guidelines, and the Companies Act 2013. Keeping up with these requirements can be time-consuming for even seasoned lawyers, and we can only imagine how difficult it would be for startups. Startups spend their initial years focusing on fund-raising, marketing, minimum viable products, and scaling their businesses. Legal advice does not usually factor in as a necessity. Our firm aims to help startups even before they get off the ground, and through their initial years of growth. We wanted to be the ones bringing in that change in the legal sector, and we hope to help many more such startups in the future.
In your opinion, are there any specific India-related problems that corporate/ commercial firms face as far as the company laws are concerned? Is there scope for improvement on this front?
The Indian legal system which corporate/commercial firms deal with is a living breathing organism, evolving each year. Due to this evolving nature, we lawyers are always on our toes.From a minor amendment to the Companies Act to the overhaul of the foreign exchange regime by the Reserve Bank of India, each of these changes affect the compliance and regulatory regime of corporates. For instance, when India changed the investment route for countries sharing land border with India,whereby any country sharing land border with India including Hong Kong cannot invest in India without approval of the RBI in consultation with the central government,it impacted a lot of ongoing transactions and we as lawyers had to be the first ones to inform our clients about such a change in the country’s foreign investment policy. In my opinion, there is huge scope of improvement in legal regime in India, I think a stable regulatory and tax regime is the need for the hour so far as the Indian system is concerned. The biggest example of such a market with stable regulatory and tax regime is Singapore, and we must work towards emulating the same.
Your boutique law firm has offices in three different cities — Delhi NCR, Mumbai and Bangalore. Have the Covid-induced restrictions such as WFH affected your firm’s operations? How has your firm adapted to the professional challenges imposed by the pandemic-related lifestyle changes?
We have offices in New Delhi NCR and Mumbai, and our main office is in Bangalore. Before the pandemic, our work schedule involved a fair bit of travelling across these cities. But post the lockdowns we shifted to a hybrid model, and unless absolutely necessary, we usually work from home.
In relation to the professional challenges during the pandemic, I think it was a difficult time for most young professionals. We do acknowledge the fact that our firm survived the pandemic. Our work as lawyers/ law firms also involves client outreach and getting new clients, which was difficult during the lockdowns. We expanded our client outreach through digital means and by conducting webinars, including one with King’s College London on International Treaty Arbitration. Further, we also focused on client outreach and knowledge management during the pandemic to educate and create legal awareness among our clients.
‘It’s a myth that good legal advice comes at prohibitive costs. A lot of heartburn can be avoided if documents are entered into with proper legal advice and with due negotiations.’ – Archana Balasubramanian
Archana Balasubramanian is the founding partner of Agama Law Associates, a Mumbai-based corporate law firm which she started in 2014. She specialises in general corporate commercial transaction and advisory as well as deep sectoral expertise across manufacturing, logistics, media, pharmaceuticals, financial services, shipping, real estate, technology, engineering, infrastructure and health.
August 13, 2021:
Lawyers see companies ill-prepared for conflict, often, in India. When large corporates take a remedial instead of mitigative approach to legal issues – an approach utterly incoherent to both their size and the compliance ecosystem in their sector – it is there where the concept of costs on legal becomes problematic. Pre-dispute management strategy is much more rationalized on the business’ pocket than the costs of going in the red on conflict and compliances.
Corporates often focus on business and let go of backend maintenance of paperwork, raising issues as and when they arise and resolving conflicts / client queries in a manner that will promote dispute avoidance.
Corporate risk and compliance management is yet another elephant in India, which in addition to commercial disputes can be a drain on a company’s resources. It can be clubbed under four major heads – labour, industrial, financial and corporate laws. There are around 20 Central Acts and then specific state-laws by which corporates are governed under these four categories.
Risk and compliance management is also significantly dependent on the sector, size, scale and nature of the business and the activities being carried out.
The woes of a large number of promoters from the ecommerce ecosystem are to do with streamlining systems to navigate legal. India has certain heavily regulated sectors and, like I mentioned earlier, an intricate web of corporate risk and compliance legislation that can result in prohibitive costs in the remedial phase. To tackle the web in the preventive or mitigative phase, start-ups end up lacking the arsenal due to sheer intimidation from legal. Promoters face sectoral risks in sectors which are heavily regulated, risks of heavy penalties and fines under company law or foreign exchange laws, if fund raise is not done in a compliant manner.
It is a myth that good legal advice comes at prohibitive costs. Promoters are quick to sign on the dotted line and approach lawyers with a tick the box approach. A lot of heartburn can be avoided if documents are entered into with proper legal advice and with due negotiations.
Investment contracts, large celebrity endorsement contracts and CXO contracts are some key areas where legal advice should be obtained. Online contracts is also emerging as an important area of concern.
When we talk of scope, arbitration is pretty much a default mechanism at this stage for adjudicating commercial disputes in India, especially given the fixation of timelines for closure of arbitration proceedings in India. The autonomy it allows the parties in dispute to pick a neutral and flexible forum for resolution is substantial. Lower courts being what they are in India, arbitration emerges as the only viable mode of dispute resolution in the Indian commercial context.
The arbitrability of disputes has evolved significantly in the last 10 years. The courts are essentially pro-arbitration when it comes to judging the arbitrability of subject matter and sending matters to arbitration quickly.
The Supreme Court’s ruling in the Vidya Drolia case has significantly clarified the position in respect of tenancy disputes, frauds and consumer disputes. It reflects upon the progressive approach of the court and aims to enable an efficient, autonomous and effective arbitration environment in India.
Law firms stand for ensuring that the law works for business and not against it. Whatever the scope of our mandate, the bottom line is to ensure a risk-free, conflict-free, compliant and prepared enterprise for our client, in a manner that does not intimidate the client or bog them down, regardless of the intricacy of the legal and regulatory web it takes to navigate to get to that end result. Lawyers need to dissect the business of law from the work.
This really involves meticulous, detail-oriented, sheer hard work on the facts, figures, dates and all other countless coordinates of each mandate, repetitively and even to a, so-called, “dull” routine rhythm – with consistent single-mindedness and unflinching resolve.
As a firm, multiply that effort into volumes, most of it against-the-clock given the compliance heavy ecosystem often riddled with uncertainties in a number of jurisdictions. So the same meticulous streamlining of mandate deliverables has to be extrapolated by the management of the firm to the junior most staff.
Further, the process of streamlining itself has to be more dynamic than ever now given the pace at which the new economy, tech-ecosystem, business climate as well as business development processes turn a new leaf.
Finally, but above all, we need to find a way to feel happy, positive and energized together as a team while chasing all of the aforesaid dreams. The competitive timelines and volumes at which a law firm works, this too is a real challenge. But we are happy to face it and evolve as we grow.
We always as a firm operated on the work from anywhere principle. We believed in it and inculcated this through document management processes to the last trainee. This helped us shut shop one day and continue from wherever we are operating.
The team has been regularly meeting online (at least once a day). We have been able to channel the time spent in travelling to and attending meetings in developing our internal knowledge banks further, streamline our processes, and work on integrating various tech to make the practice more cost-effective for our clients.
Right to Disclosure – Importance & Challenges in Criminal Justice System – By Manu Sharma
Personal liberty is the most cherished value of human life which thrives on the anvil of Articles 14 and 21 of the Constitution of India (“the Constitution”). Once a person is named an accused, he faces the spectre of deprivation of his personal liberty and criminal trial. This threat is balanced by Constitutional safeguards which mandate adherence to the rule of law by the investigating agencies as well as the Court. Thus, any procedure which seeks to impinge on personal liberty must also be fair and reasonable. The right to life and personal liberty enshrined under article 21 of the Constitution, expanded in scope post Maneka Gandhi[1], yields the right to a fair trial and fair investigation. Fairness demands disclosure of anything relevant that may be of benefit to an accused. Further, the all-pervading principles of natural justice envisage the right to a fair hearing, which entails the right to a full defence. The right to a fair defence stems from full disclosure. Therefore, the right of an accused to disclosure emanates from this Constitutional philosophy embellished by the principles of natural justice and is codified under the Code of Criminal Procedure, 1973 (“Code”).
Under English jurisprudence, the duty of disclosure is delineated in the Criminal Procedure and Investigations Act, 1996, which provides that the prosecutor must disclose to the accused any prosecution material which has not previously been disclosed to the accused and which might reasonably be considered capable of undermining the case for the prosecution against the accused or of assisting the case for the accused, except if such disclosure undermines public interest.[2] Fairness ordinarily requires that any material held by the prosecution which weakens its case or strengthens that of the defendant, if not relied on as part of its formal case against the defendant, should be disclosed to the defence.[3] The duty of disclosure under common law contemplates disclosure of anything which might assist the defence[4], even if such material was not to be used as evidence[5]. Under Indian criminal jurisprudence, which has borrowed liberally from common law, the duty of disclosure is embodied in sections 170(2), 173, 207 and 208 of the Code, which entail the forwarding of material to the Court and supply of copies thereof to the accused, subject to statutory exceptions.
II. Challenges in Enforcement
The right to disclosure is a salient feature of criminal justice, but its provenance and significance appear to be lost on the Indian criminal justice system. The woes of investigative bias and prosecutorial misconduct threaten to render this right otiose. That is not to say that the right of an accused to disclosure is indefeasible, as certain exceptions are cast in the Code itself, chief among them being public interest immunity under section 173(6). However, it is the mischief of the concept of ‘relied upon’ emerging from section 173(5) of the Code, which is wreaking havoc on the right to disclosure and is the central focus of this article. The rampant misuse of the words “on which the prosecution proposes to rely’ appearing in section 173(5) of the Code, to suppress material favourable to the accused or unfavourable to the prosecution in the garb of ‘un-relied documents’ has clogged criminal courts with avoidable litigation at the very nascent stage of supply of copies of documents under section 207 of the Code. The erosion of the right of an accused to disclosure through such subterfuge is exacerbated by the limited and restrictive validation of this right by criminal Courts. The dominant issues highlighted in the article, which stifle the right to disclosure are; tainted investigation, unscrupulous withholding of material beneficial to the accused by the prosecution, narrow interpretation by Courts of section 207 of the Code, and denial of the right to an accused to bring material on record in the pre-charge stage.
A. Tainted Investigation
Fair investigation is concomitant to the preservation of the right to fair disclosure and fair trial. It envisages collection of all material, irrespective of its inculpatory or exculpatory nature. However, investigation is often vitiated by the tendencies of overzealous investigating officers who detract from the ultimate objective of unearthing truth, with the aim of establishing guilt. Such proclivities result in collecting only incriminating material during investigation or ignoring the material favourable to the accused. This leads to suppression of material and scuttles the right of the accused to disclosure at the very inception. A tainted investigation leads to miscarriage of justice. Fortunately, the Courts are not bereft of power to supervise investigation and ensure that the right of an accused to fair disclosure remains protected. The Magistrate is conferred with wide amplitude of powers under section 156(3) of the Code to monitor investigation, and inheres all such powers which are incidental or implied to ensure proper investigation. This power can be exercised suo moto by the Magistrate at all stages of a criminal proceeding prior to the commencement of trial, so that an innocent person is not wrongly arraigned or a prima facie guilty person is not left out.[6]
B. Suppression of Material
Indian courts commonly witness that the prosecution is partisan while conducting the trial and is invariably driven by the lust for concluding in conviction. Such predisposition impels the prosecution to take advantage by selectively picking up words from the Code and excluding material favouring the accused or negating the prosecution case, with the aid of the concept of ‘relied upon’ within section 173(5) of the Code. However, the power of the prosecution to withhold material is not unbridled as the Constitutional mandate and statutory rights given to an accused place an implied obligation on the prosecution to make fair disclosure.[7] If the prosecution withholds vital evidence from the Court, it is liable to adverse inference flowing from section 114 of the Indian Evidence Act, 1872 (“Evidence Act). The prosecutor is expected to be guided by the Bar Council of India Rules which prescribe that an advocate appearing for the prosecution of a criminal trial shall so conduct the prosecution that it does not lead to conviction of the innocent. The suppression of material capable of establishment of the innocence of the accused shall be scrupulously avoided. [8]
C. Scope of S. 207
The scope of disclosure under section 207 has been the subject of fierce challenge in Indian Courts on account of the prosecution selectively supplying documents under the garb of ‘relied upon’ documents, to the prejudice of the defence of an accused. The earlier judicial trend had been to limit the supply of documents under section 207 of the Code to only those documents which were proposed to be relied upon by the prosecution. This view acquiesced the exclusion of documents which were seized during investigation, but not filed before the Court along with the charge sheet, rendering the right to disclosure a farce. This restrictive sweep fails to reconcile with the objective of a fair trial viz. discovery of truth. The scheme of the code discloses that Courts have been vested with extensive powers inter alia under sections 91, 156(3) and 311 to elicit the truth. Towards the same end, Courts are also empowered under Section 165 of the Evidence Act. Thus, the principle of harmonious construction warrants a more purposive interpretation of section 207 of the code. The Hon’ble Supreme Court expounded on the scope of Section 207 of the Code in the case of Manu Sharma[9] and held that documents submitted to the Magistrate under section 173(5) would deem to include the documents which have to be sent to the magistrate during the course of investigation under section 170(2). A document which has been obtained bona fide and has a bearing on the case of the prosecution should be disclosed to the accused and furnished to him to enable him to prepare a fair defence, particularly when non production or disclosure would affect administration of justice or prejudice the defence of the accused. It is not for the prosecution or the court to comprehend the prejudice that is likely to be caused to the accused. The perception of prejudice is for the accused to develop on reasonable basis.[10] Manu Sharma’s [supra] case has been relied upon in Sasikala [11] wherein it was held that the Court must concede a right to the accused to have access to the documents which were forwarded to the Court but not exhibited by the prosecution as they favoured the accused. These judgments seem more in consonance with the true spirit of fair disclosure and fair trial. However, despite such clear statements of law, courts are grappling with the judicial propensity of deviating from this expansive interpretation and regressing to the concept of relied upon. The same is evident from a recent pronouncement of the Delhi High Court where the ratios laid down in Manu Sharma & Sasikala [supra] were not followed by erroneously distinguishing from those cases.[12] Such “per incuriam” aberrations by High Court not only undermine the supremacy of the Apex Court, but also adversely impact the functioning of the district courts over which they exercise supervisory jurisdiction. Hopefully in future Judges shall be more circumspect and strictly follow the law declared by the Apex Court.
D. Pre-Charge Embargo
Another obstacle encountered in the enforcement of the right to disclosure is the earlier judicial approach to stave off production or consideration of any additional documents not filed alongwith the charge sheet at the pre-charge stage, as the right to file such material was available to the accused only upon the commencement of trial after framing of charge.[13] At the pre-charge stage, Court could not direct the prosecution to furnish copies of other documents[14] It was for the accused to do so during trial or at the time of entering his defence. However, the evolution of law has seen that at the stage of framing charge, Courts can rely upon the material which has been withheld by the prosecutor, even if such material is not part of the charge sheet, but is of such sterling quality demolishing the case of the prosecution.[15] Courts are not handicapped to consider relevant material at the stage of framing charge, which is not relied upon by the prosecution. It is no argument that the accused can ask for the documents withheld at the time of entering his defence.[16] The framing of charge is a serious matter in a criminal trial as it ordains an accused to face a long and arduous trial affecting his liberty. Therefore, the Court must have all relevant material before the stage of framing charge to ascertain if grave suspicion is made out or not. Full disclosure at the stage of section 207 of the code, which immediately precedes discharging or charging an accused, enables an accused to seek a discharge, if the documents, including those not relied upon by the prosecution, create an equally possible view in favour of the accused.[17] On the other hand, delaying the reception of documents postpones the vindication of the accused in an unworthy trial and causes injustice by subjecting him to the trauma of trial. There is no gainsaying that justice delayed is justice denied, therefore, such an approach ought not to receive judicial consent. A timely discharge also travels a long way in saving precious time of the judiciary, which is already overburdened by the burgeoning pendency of cases. Thus, delayed or piecemeal disclosure not only prejudices the defence of the accused, but also protracts the trial and occasions travesty of justice.
III. Duties of the stakeholders in criminal justice system
The foregoing analysis reveals that participation of the investigating agency, the prosecution and the Court is inextricably linked to the enforcement of the right to disclosure. The duties cast on these three stakeholders in the criminal justice system, are critical to the protection of this right. It is incumbent upon the investigating agencies to investigate cases fairly and to place on record all the material irrespective of its implication on the case of prosecution case. Investigation must be carried out with equal alacrity and fairness irrespective of status of accused or complainant.[18] An onerous duty is cast on the prosecution as an independent statutory officer, to conduct the trial with the objective of determination of truth and to ensure that material favourable to the defence is supplied to the accused. Ultimately, it is the overarching duty of the Court to ensure a fair trial towards the administration of justice for all parties. The principles of fair trial require the Court to strike a delicate balance between competing interests in a system of adversarial advocacy. Therefore, the court ought to exercise its power under section 156(3) of the Code to monitor investigation and ensure that all material, including that which enures to the benefit of the accused, is brought on record. Even at the stage of supply of copies of police report and documents under section 207 of the Code, it is the duty of the Court to give effect to the law laid down by the Hon’ble Supreme Court in Manu Sharma (supra) and Sasikala (supra), and ensure that all such material is supplied to the accused irrespective of whether it is “relied upon” by the prosecution or not.
IV. Alternate Remedy
The conundrum of supply of copies under section 207 of the code abounds criminal trials. Fairness is an evolving concept. There is no doubt that disclosure of all material which goes to establish the innocence of an accused is the sine qua non of a fair trial.[19] Effort is evidently underway to expand the concept in alignment with English jurisprudence. In the meanwhile, does the right of an accused to disclosure have another limb to stand on? Section 91 of the Code comes to the rescue of an accused, which confers wide discretionary powers on the Court, independent of section 173 of the Code, to summon the production of things or documents, relevant for the just adjudication of the case. In case the Court is of the opinion that the prosecution has withheld vital, relevant and admissible evidence from the Court, it can legitimately use its power under section 91 of the Code to discover the truth and to do complete justice to the accused.[20]
V. Conclusion
A society’s progress and advancement are judged on many parameters, an important one among them being the manner in which it administers criminal justice. Conversely, the ironic sacrilege of the core virtues of criminal jurisprudence in the temples of justice evinces social decadence. The Indian legislature of the twenty first century has given birth to several draconian statutes which place iron shackles on personal liberty, evoking widespread fear of police abuses and malicious prosecution. These statutes not only entail presumptions which reverse the burden of proof, but also include impediments to the grant of bail. Thus, a very heavy burden to dislodge the prosecution case is imposed on the accused, rendering the right to disclosure of paramount importance. It is the duty of the Court to keep vigil over this Constitutional and statutory right conferred on an accused by repudiating any procedure which prejudices his defence. Notable advancement has been made by the Apex Court in interpreting section 207 of the Code in conformity with the Constitutional mandate, including the right to disclosure. Strict adherence to the afore-noted principles will go a long way in ensuring real and substantial justice. Any departure will not only lead to judicial anarchy, but also further diminish the already dwindling faith of the public in the justice delivery system.
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Advocate Manu Sharma has been practising at the bar for over sixteen years. He specialises in Criminal Defence. Some of the high profile cases he has represented are – the 2G scam case for former Union minister A Raja; the Religare/Fortis case for Malvinder Singh; Peter Mukerjee in the P Chidambaram/ INX Media case; Devas Multimedia in ISRO corruption act case; Om Prakash Chautala in PMLA case; Aditya Talwar in the aviation scam case; Dilip Ray, former Coal Minister in one of the coal scam cases; Suhaib Illyasi case.
**
Disclaimer: The views or opinions expressed are solely of the author.
[1] Maneka Gandhi and Another v. Union of India, (1978) 1 SCC 248
[2] S. 3 of the Criminal Procedure and Investigations Act, 1996
[3] R v. H and R v. C, 2004 (1) ALL ER 1269
[4] R v. Ward (Judith), (1993) 1 WLR 619 : (1993) 2 ALL ER 577 (CA)
[5] R v. Preston, (1994) 2 AC 130 : (1993) 3 WLR 891 : (1993) 4 ALL ER 638 (HL), R v. Stinchcome,
(1991), 68 C.C.C. (3d) 1 (S.C.C.)
[6] Vinubhai Haribhai Malaviya and Others v. State of Gujarat and Another, 2019 SCC Online SC 1346
[7] Sidhartha Vashishth alias Manu Sharma v. State (NCT of Delhi), (2010) 6 SCC 1
[8] R. 16, part II, Ch. VI of the Bar Council of India Rules
[9] Manu Sharma, (2010) 6 SCC 1
[10] V.K. Sasikala v. State, (2012) 9 SCC 771 : AIR 2013 SC 613
[11] Sasikala, (2012) 9 SCC 771 : AIR 2013 SC 613
[12] Sala Gupta and Another v. Directorate of Enforcement, (2019) 262 DLT 661
[13] State of Orissa v. Debendra Nath Padhi¸(2005) 1 SCC 568
[14] Dharambir v. Central Bureau of Investigation, ILR (2008) 2 Del 842 : (2008) 148 DLT 289
[15] Nitya Dharmananda alias K. Lenin and Another v. Gopal Sheelum Reddy, (2018) 2 SCC 93
[16] Neelesh Jain v. State of Rajasthan, 2006 Cri LJ 2151
[17] Dilwar Balu Kurane v. State of Maharashtra, (2002) 2 SCC 135, Yogesh alias Sachin Jagdish Joshi v. State of Maharashtra, (2008) 10 SCC 394
[18] Karan Singh v. State of Haryana, (2013) 12 SCC 529
[19] Kanwar Jagat Singh v. Directorate of Enforcement & Anr, (2007) 142 DLT 49
[20] Neelesh, 2006 Cri LJ 2151
Disclaimer: The views or opinions expressed are solely of the author.
Validity & Existence of an Arbitration Clause in an Unstamped Agreement
By Kunal Kumar
January 8, 2024
In a recent ruling, a seven-judge bench of the Supreme Court of India in its judgment in re: Interplay between arbitration agreements under the Arbitration & Conciliation Act 1996 and the Indian Stamp Act 1899, overruled the constitutional bench decision of the Supreme Court of India in N. N. Mercantile Private Limited v. Indo Unique Flame Ltd. & Ors. and has settled the issue concerning the validity and existence of an arbitration clause in an unstamped agreement. (‘N. N. Global Mercantile (P) Ltd. v. Indo Unique Flame Ltd. – III’)
Background to N. N. Global Mercantile (P) Ltd. v. Indo Unique Flame Ltd. – III
One of the first instances concerning the issue of the validity of an unstamped agreement arose in the case of SMS Tea Estate Pvt. Ltd. v. Chandmari Tea Company Pvt. Ltd. In this case, the Hon’ble Apex Court held that if an instrument/document lacks proper stamping, the exercising Court must preclude itself from acting upon it, including the arbitration clause. It further emphasized that it is imperative for the Court to impound such documents/instruments and must accordingly adhere to the prescribed procedure outlined in the Indian Stamp Act 1899.
With the introduction of the 2015 Amendment, Section 11(6A) was inserted in the Arbitration & Conciliation Act 1996 (A&C Act) which stated whilst appointing an arbitrator under the A&C Act, the Court must confine itself to the examination of the existence of an arbitration agreement.
In the case of M/s Duro Felguera S.A. v. M/s Gangavaram Port Limited, the Supreme Court of India made a noteworthy observation, affirming that the legislative intent behind the 2015 Amendment to the A&C Act was necessitated to minimise the Court's involvement during the stage of appointing an arbitrator and that the purpose embodied in Section 11(6A) of A&C Act, deserves due acknowledgement & respect.
In the case of Garware Wall Ropes Ltd. v. Cosatal Marine Constructions & Engineering Ltd., a divisional bench of the Apex Court reaffirmed its previous decision held in SMS Tea Estates (supra) and concluded that the inclusion of an arbitration clause in a contract assumes significance, emphasizing that the agreement transforms into a contract only when it holds legal enforceability. The Apex Court observed that an agreement fails to attain the status of a contract and would not be legally enforceable unless it bears the requisite stamp as mandated under the Indian Stamp Act 1899. Accordingly, the Court concluded that Section 11(6A) read in conjunction with Section 7(2) of the A&C Act and Section 2(h) of the Indian Contract Act 1872, clarified that the existence of an arbitration clause within an agreement is contingent on its legal enforceability and that the 2015 Amendment of the A&C Act to Section 11(6A) had not altered the principles laid out in SMS Tea Estates (supra).
Brief Factual Matrix – N. N. Global Mercantile (P) Ltd. v. Indo Unique Flame Ltd.
Indo Unique Flame Ltd. (‘Indo Unique’) was awarded a contract for a coal beneficiation/washing project with Karnataka Power Corporation Ltd. (‘KPCL’). In the course of the project, Indo Unique entered into a subcontract in the form of a Work Order with N.N. Global Mercantile Pvt. Ltd. (‘N.N. Global’) for coal transportation, coal handling and loading. Subsequently, certain disputes arose with KPCL, leading to KPCL invoking Bank Guarantees of Indo Unique under the main contract, after which Indo Unique invoked the Bank Guarantee of N. N. Global as supplied under the Work Order.
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Subsequently, N.N. Global initiated legal proceedings against the cashing of the Bank Guarantee in a Commercial Court. In response thereto, Indo Unique moved an application under Section 8 of the A&C Act, requesting that the Parties to the dispute be referred for arbitration. The Commercial Court dismissed the Section 8 application, citing the unstamped status of the Work Order as one of the grounds. Dissatisfied with the Commercial Court's decision on 18 January 2018, Indo Unique filed a Writ Petition before the High Court of Bombay seeking that the Order passed by the Commercial Court be quashed or set aside. The Hon’ble Bombay High Court on 30 September 2020 allowed the Writ Petition filed by Indo Unique, aggrieved by which, N.N. Global filed a Special Leave Petition before the Supreme Court of India.
N. N. Global Mercantile Pvt. Ltd. v. Indo Unique Flame Ltd. – I
The issue in the matter of M/s N.N. Global Mercantile Pvt. Ltd. v. M/s Indo Unqiue Flame Ltd. & Ors. came up before a three-bench of the Supreme Court of India i.e. in a situation when an underlying contract is not stamped or is insufficiently stamped, as required under the Indian Stamp Act 1899, would that also render the arbitration clause as non-existent and/or unenforceable (‘N.N. Global Mercantile Pvt. Ltd. v. Indo Flame Ltd. – I’).
The Hon’ble Supreme Court of India whilst emphasizing the 'Doctrine of Separability' of an arbitration agreement held that the non-payment of stamp duty on the commercial contract would not invalidate, vitiate, or render the arbitration clause as unenforceable, because the arbitration agreement is considered an independent contract from the main contract, and the existence and/or validity of an arbitration clause is not conditional on the stamping of a contract. The Hon’ble Supreme Court further held that deficiency in stamp duty of a contract is a curable defect and that the deficiency in stamp duty on the work order, would not affect the validity and/or enforceability of the arbitration clause, thus applying the Doctrine of Separability. The arbitration agreement remains valid and enforceable even if the main contract, within which it is embedded, is not admissible in evidence owing to lack of stamping.
The Hon’ble Apex Court, however, considered it appropriate to refer the issue i.e. whether unstamped instrument/document, would also render an arbitration clause as non-existent, unenforceable, to a constitutional bench of five-bench of the Supreme Court.
N. N. Global Mercantile (P) Ltd. v. Indo Unique Flame Ltd. – II
On 25 April 2023, a five-judge bench of the Hon’ble Supreme Court of India in the matter of N. N. Mercantile Private Limited v. Indo Unique Flame Ltd. & Ors. held that (1) An unstamped instrument containing an arbitration agreement cannot be said to be a contract which is enforceable in law within the meaning of Section 2(h) of the Indian Contract Act 1872 and would be void under Section 2(g) of the Indian Contract Act 1872, (2) an unstamped instrument which is not a contract nor enforceable cannot be acted upon unless it is duly stamped, and would not otherwise exist in the eyes of the law, (3) the certified copy of the arbitration agreement produced before a Court, must clearly indicate the stamp duty paid on the instrument, (4) the Court exercising its power in appointing an arbitration under Section 11 of the A&C Act, is required to act in terms of Section 33 and Section 35 of the Indian Stamp Act 1899 (N. N. Global Mercantile (P) Ltd. v. Indo Unique Flame Ltd. – II).
N. N. Global Mercantile (P) Ltd. v. Indo Unique Flame Ltd. – III
A seven-judge bench of the Supreme Court of India on 13 December 2023 in its recent judgment in re: Interplay between arbitration agreements under the Arbitration & Conciliation Act 1996 and the Indian Stamp Act 1899, (1) Agreements lacking proper stamping or inadequately stamped are deemed inadmissible as evidence under Section 35 of the Stamp Act. However, such agreements are not automatically rendered void or unenforceable ab initio; (2) non-stamping or insufficient stamping of a contract is a curable defect, (2) the issue of stamping is not subject to determination under Sections 8 or 11 of the A&C Act by a Court. The concerned Court is only required to assess the prima facie existence of the arbitration agreement, separate from concerns related to stamping, and (3) any objections pertaining to the stamping of the agreement would fall within the jurisdiction of the arbitral tribunal. Accordingly, the decision in N. N. Global Mercantile (P) Ltd. v. Indo Unique Flame Ltd. – II and SMS Tea (supra) was overruled, by the seven-judge bench of the Supreme Court of India.
Kunal is a qualified lawyer with more than nine years of experience and has completed his LL.M. in Dispute Resolution (specialisation in International Commercial Arbitration) from Straus Institute for Dispute Resolution, Pepperdine University, California.
Kunal currently has his own independent practice and specializes in commercial/construction arbitration as well as civil litigation. He has handled several matters relating to Civil Law and arbitrations (both domestic and international) and has appeared before the Supreme Court of India, High Court of Delhi, District Courts of Delhi and various other tribunals.
No Safe Harbour For Google On Trademark Infringement
By Mayank Grover & Pratibha Vyas
October 9, 2023
Innovation, patience, dedication and uniqueness culminate in establishing a distinct identity. A trademark aids in identifying the source and quality, shaping perceptions about the identity's essence. When values accompany a product or service's trademark, safeguarding against misuse and infringement becomes crucial. A recent pronouncement of a Division Bench of the Delhi High Court dated August 10, 2023 in Google LLC v. DRS Logistics (P) Ltd. & Ors. and Google India Private Limited v. DRS Logistics (P) Ltd. & Ors. directed that Google’s use of trademarks as keywords for its Google Ads Programme does amount to ‘use’ in advertising under the Trademarks Act and the benefit of safe harbour would not be available to Google if such keywords infringe on the concerned trademark.
Factual Background
Google LLC manages and operates the Google Search Engine and Ads Programme, while, Google India Private Limited is a subsidiary of Google that has been appointed as a non-exclusive reseller of the Ads Programme in India. The Respondents, DRS Logistics and Agarwal Packers and Movers Pvt. Ltd. are leading packaging, moving and logistics service providers in India.
On 22.12.2011, DRS filed a suit against Google and Just Dial Ltd. under provisions of the Trademarks Act, 1999 (‘TM Act’) inter alia seeking a permanent injunction against Google from permitting third parties from infringing, passing off etc. the relevant trademarks of DRS. The core of the dispute revolved around Google’s Ads Programme. DRS claimed that its trade name 'AGARWAL PACKERS AND MOVERS' is widely recognized and a 'well-known' trademark. Use of DRS’s trademark as a keyword diverts internet traffic from its website to that of its competitors and they were entitled to seek restraint against Google for permitting third parties who are not authorized to use the said trademark. DRS further argued that Google benefits from these trademark infringements. This practice involved charging a higher amount for displaying these ads, constituting an infringement of their trademarks. Whereas, Google contended that the use of the keyword in the Ads Programme does not amount to ‘use’ under the TM Act notwithstanding that the keyword is/or similar to a trademark. Thus, the use of a term as a keyword cannot be construed as an infringement of a trademark under the TM Act, and being an intermediary, it claimed a safe harbour under Section 79 of the Information Technology Act, 2000. (‘IT Act’).
In essence, the dispute between the parties was rooted in DRS’s grievance concerning the Ads Programme. The Learned Single Judge vide judgment dated 30.10.2021interpreted relevant provisions of the TM Act and drew on multiple legal precedents to arrive at the decision that DRS can seek protection of its trademarks which were registered under Section 28 of the TM Act and issued directions to investigate complaints alleging the use of trademark and/or to ascertain whether a sponsored result has an effect of infringing a trademark or passing off.
Being aggrieved, Google LLC and Google Pvt. Ltd. filed appeals before the Division Bench. Google LLC argued that the Single Judge’s findings were erroneous and the directions issued were liable to be set aside. Google India claimed that it doesn’t control and operate the Search Engine and the Ads Programme making it unable to comply with the directions passed in the impugned judgment.
Analysis & Decision of Court
The Division Bench found Single Judge’s rationale for assessing trademark infringement through keywords and meta-tags valid. Meta-tags are a list of words/code in a website, not readily visible to the naked eye. It serves as a tool for indexing the website by a search engine. If a trademark of a third party is used as a meta-tag, the same would serve as identifying the website as relevant to the search query that includes the trademark as a search term. The use of keywords in the Ads Programme also serves similar purpose. The Division Bench was unable to accept that using a trademark as a keyword, even if not visible, would not be considered trademark use under the TM Act.
Google placed heavy reliance on the decisions rendered by Courts across jurisdictions of United Kingdom, United States of America, European Union, Australia, New Zealand, Russia, South Africa, Canada, Spain, Italy, Japan and China; in the cases of Google France SARL and Google Inc. v. Louis Vitton SA & Ors.[1], Interflora Inc. v. Marks & Spencer Plc.[2], and L’Oreal SA v. eBay International AG[3] in support of the contention that the use of trade marks is by the advertiser and not by Google. However, the Division Bench rejected Google’s passive role; highlighting its active involvement in recommending and promoting trademark keywords for higher clicks in its Ads Programme. Division Bench referred to a few judicial decisions rendered in the United States of America that captured the essence of the controversy for perspective, concluding that Google actively promotes and encourages trademarks associated with major goods and services, rather than having a passive role.
It was held that the contention that the use of trademarks as keywords, per se constitutes an infringement of the trademark is unmerited; the assumption that an internet user is merely searching the address of the proprietor of the trademark when he feeds in a search query that may contain a trademark, is erroneous.
The Doctrine of 'Initial Interest Confusion' addresses trademark infringement based on pre-purchase confusion. The doctrine is applied when meta-tags, keywords, or domain names cause initial confusion similar to a registered trademark. If users are misled to access unrelated websites, trademark use in internet advertising may be actionable and reliance was placed on US precedents. Referring to Section 29 of the TM Act, it was directed that Section 29 does not specify the duration for which the confusion lasts but, even if the confusion is for a short duration and an internet user is able to recover from the same, the trade mark would be infringed and would offend Section 29(2) of the TM Act.
It was held that the Ads Programme is a platform for displaying advertisements. Google, being an architect and operator of its own programme makes it an active participant in the use of trademarks and determining the advertisements displayed on search pages. Their use of proprietary software makes them utilize trademarks and control the distribution of information related to potentially infringing links, ultimately leading to revenue maximization. Hence, a substantial link exists between Google LLC and Google India, rendering it impossible for Google India to deny its role in operating the Ads Programme. It was further held that Google sells trademarks as keywords to advertisers and encourages users to use trademarks as keywords for ads. It is contradictory for Google to encourage trademark use while claiming data belongs to third parties for exemption. After 2004, Google changed policies to boost revenue and subsequently, introduced a tool that searches effective terms, including trademarks. Google's active involvement in its advertising business and online nature does not necessarily qualify it for benefits under Section 79 of the IT Act. The Division Bench agreed with the view of the Single Judge that Google would not be eligible for protection of safe harbour under Section 79(1) of the IT Act, if its alleged activities infringe trademarks.
Conclusion
This is a seminal decision governing (and rather, restricting) the operations of intermediaries and redefining the jurisprudence of safe harbour under the IT Act. The decision is well-reasoned and establishes a significant precedent for safeguarding trademarks by uniquely holding Google accountable under its Ads Programme. The same will prevent usage of tradenames as a third-party trademark in keyword search or metatags by advertisers on Google’s search engine. While keywords and meta-tags have different levels of visibility, their purpose is similar i.e. advertising and attracting internet traffic. The use of trademarks as meta-tags by a person who is neither a proprietor of the trademark nor permitted to use the same leads to confusion amongst public at large due to the automated processes of search engines and consequently, constitutes trademark infringement.
About the Authors: Mayank Grover is a Partner and Pratibha Vyas is an Associate at Seraphic Advisors, Advocates & Solicitors
[1] C-236/08 to C-238/08 (2010) [2011] All ER (EC) 41
[2] [2014] EWCA Civ 1403
[3] 2C- 324/09 (2010)
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