Legal News & Views

The issue came up before the Hon'ble Bombay High Court in Supreme Industries Ltd. V/s. The Additional Commissioner of Income­Tax & Others. In this matter, the petitioner while while seeking to rectify an order made a mistake by referring to incorrect orders before relevant authority. The said authority passed an order referring to the orders (incorrect) asked for. However,  when the petitioners realised their mistake filed an application for rectification/correction of the order, the Tribunal rejected the application stating that the proceeding under Section 254(2) of the Act are meant only for rectifying mistakes apparent from the record committed by the Tribunal and not  the mistake of the parties concerned. The petitioners appealed against the said order. Held by the High Court: (i) It is a settled position in law that every authority exercising quasi judicial powers has inherent/ incidental power in discharging of its functions to ensure that justice is ...

A statutory order, even if a nullity, continues to be effective unless set aside by a competent authority. Such orders cannot be nullified by an administrative order The principal controversy in R.K. JAIN vs CHAIRMAN, INCOME TAX SETTLEMENT COMMISSION & ORS., was whether the Chairman, Income Tax Settlement Commission could void an order passed by Central Public Information Officer & Administrative Officer, Income Tax Settlement Commission. Background: The petitioner had filed an RTI application seeking information, inter alia, with respect to disposal and pendency of matters before the Income Tax Settlement Commission. In response to this application, respondent no.2 (CPIO and Joint Commissioner of Income Tax, Income Tax Settlement Commission) passed an order dated 26.09.2013 furnishing certain information to the petitioner. However, by the said order certain other information as sought for was denied. The petitioner preferred an appeal before respondent no 4, wh...

The above judgment was given by the Hon'ble High Court of Andhra Pradesh in the matter of  Commissioner of Income Tax-II (Hyderabad) vs M/s Janapriya Engineers Syndicate. In the above matter, the question before the Ld. court was "Whether the learned Tribunal was justified in law on the facts and circumstances of this case in passing order of remand for re-decision ignoring the Special Bench decision of the Tribunal on the issue though the appeal against the same is pending adjudication before the Hon’ble Court ?” The Hon'ble judges opined "We are of the view that until and unless the decision of the Special Bench is upset by this Court, it binds smaller Bench and coordinate Bench of the Tribunal. Under the circumstances, it is not open to the Tribunal to remand on the ground of pendency on the same issue before this Court, overlooking and overruling, by necessary implication, the decision of the Special Bench. We simply say that it is not permissible under quasi...

 In one of the most significant verdicts delivered in 2014 on an issue that reveals a society in transition, the Bombay high court has ruled that every breach of promise to marry is not rape and pre-marital sex between couples is no longer shocking in India's big cities. The observations came earlier this year during the hearing of an anticipatory bail application filed by a Nashik resident, Rahul Patil, who was booked on charges of cheating and rape following a complaint filed by his former girlfriend Seema Deshmukh. Seema, who claimed she was pregnant with Rahul's child, said despite promising to marry her, he had married another girl. Rahul claimed the relationship was consensual, and they could not marry as they belonged to different religions. Rahul and Seema, both lawyers, knew each other since 1999 and had a physical relationship since 2006. Seema claimed he had promised to marry her. In 2009, when he said he could not, she had tried to commit suicide. They continue...

RBI/2014-15/362 DBR.No.CID.BC.54/20.16.064/2014-15 December 22, 2014 All Scheduled Commercial Banks (Excluding RRBs) All-India Term-Lending and Refinancing Institutions (Exim Bank, NABARD, NHB and SIDBI) Dear Sir / Madam Non-Cooperative Borrowers Please refer to our  circular DBOD.BP.BC.No.97/21.04.132/2013-14 dated February 26, 2014  on ‘Framework for Revitalising Distressed Assets in the Economy - Guidelines on Joint Lenders' Forum (JLF) and Corrective Action Plan (CAP)’ which inter-alia, provides for specific prudential measures and reporting requirements in respect of Non-Cooperative Borrowers. The definition of a Non-Cooperative Borrower as contained therein is hereby modified to read as under: A non-cooperative borrower is one who does not engage constructively with his lender by defaulting in timely repayment of dues while having ability to pay, thwarting lenders’ efforts for recovery of their dues by not providing necessary information sought, denyi...

In a significant judgment benefitting landowners, the Punjab and Haryana High Court has held that the period of stay granted by the courts has to be counted while computing five-year period prescribed under the Rehabilitation and Resettlement Act of 2013 for release of land. The ruling is important as the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013, says proceedings shall deemed to have lapsed if the award is passed more than five years ago, but possession of the land has not been taken or compensation has not been paid. It now means that the stay period will be taken into consideration. In case of inability of the state to take possession of land due to stay by the courts for five years or more, the proceedings shall be deemed to have lapsed. The matter was placed before the High Court Bench comprising Justices Hemant Gupta, GS Sandhawalia and Kuldeep Singh. Justices Hemant Gupta and GS Sandhawalia ruled: "We h...

1. Delhi High Court ruling on currency conversion and interest when enforcing a foreign award We have previously reported on the case of Shri Lal Mahal Limited v Progetto Grano S.P.A where the Supreme Court refused to entertain a challenge to the enforcement of a foreign arbitral award on public policy grounds. More recently, in the subsequent enforcement proceedings, the Delhi High Court has clarified two important issues in the enforcement of foreign arbitral awards1. Firstly, it held that the relevant date for determining the rate of exchange for the calculation of the rupee equivalent to the awarded amount is the date when the award is deemed to be an executable decree under section 49 of the Arbitration and Conciliation Act 1996 (the "Act"). It also held that the Act does not give power to executing and enforcing courts to grant interest, over and above what has been provided for in the award itself. Read more here. 2. Bombay High Court holds that arbitration agre...

In an order that will benefit hundreds of senior citizens, the Bombay high court has ruled that New India Assurance was wrong in charging premium from existing policy holders as of August 2007 on the basis of running age and not completed age. Hearing a public interest litigation filed by Mumbai resident Dr Babulal Shah, a division bench of Justice Abhay Oka and Justice Girish Kulkarni order NIA to refund the excess amount charged from the petitioner and similarly placed senior citizens along with six per cent interest. The judges also directed the insurance company to shell out Rs 10,000 which will be paid as litigation costs to Shah. ''In case of senior citizens who were holding mediclaim policies as of August 2007, NIA could not have charged premium on the basis of running age while renewing the policy,'' said the judges. The HC pointed out that the Insurance Regulatory and Development Authority (Irda) had not given its approval to NIA to charge on the basis of ru...

A simple directive issued by the Kerala high court has brought into effect the right of owners to register their apartments individually, thereby tremendously enhancing sale ability of apartments. The directive, issued by Justice A Muhamed Mustaque on a petition by J K Pearl Apartment Owners Association at Pulleppady, also enables setting up a basic framework of rules regarding right of apartment owners on common facilities and maintenance. In a petition filed through advocate P B Sahasranaman, the association secretary P Krishna Das questioned the registration department's denial of registration of apartments individually as per Kerala Apartment Ownership Act of 1983. The Act provides for ownership of individual apartment in a building and make such apartment heritable and transferable property. The practice now is to register apartments under the Registration Act, which often leads to a situation where the exact rights of an individual apartment owner are not clearly sp...

Even as bankers struggle to recover dues from errant borrowers, grappling with an inefficient legal system, the Reserve Bank of India (RBI) on Monday put out a set of revised guidelines on how lenders should deal with ‘non-cooperative’ borrowers. The modified definition of non-cooperative borrower, it would appear, is a lot similar to that of a ‘wilful defaulter’.The RBI has characterised a non-cooperative borrower as one “who does not engage constructively with his lender by defaulting in timely repayment of dues while having ability to pay, thwarting lenders’ efforts for recovery of their dues by not providing necessary information sought, denying access to assets financed and collateral securities, obstructing sale of securities”. “In effect, a non-cooperative is a defaulter who deliberately stonewalls the efforts of lenders to recover their dues,” the central bank said on Monday, asking lenders to put in place a transparent mechanism for classifying borrowers as such. The ...

In a significant judgement, the Allahabad high court has ruled that the religious conversion of girls "without their faith and belief in Islam" and "solely for the purpose of marriage" to Muslim boys could not be held valid. Justice Surya Prakash Kesarwani passed the order while dismissing a batch of petitions filed by five couples, hailing from different districts of Uttar Pradesh, who had sought "protection as married couple". In each case, the boys were Muslim while the girls were Hindus who got converted to Islam for solemnising " nikah". Article referred: http://timesofindia.indiatimes.com/india/Conversion-to-Islam-solely-for-marriage-not-valid-Allahabad-HC/articleshow/45576404.cms

"Every day is a matter of learning," said the Supreme Court realizing and learning from a male advocate's remark that he found it 'delightful' to be repeatedly interrupted during his arguments by a woman lawyer. This realization dawned on the court during the hearing of a petition filed by a former Gwalior additional district Judge, who had challenged the in-house inquiry committee set by the Madhya Pradesh high court Chief Justice to probe her sexual harassment complaint against a sitting HC Judge. The sequence of events unfolded like this. When the counsel for the HC was advancing his arguments, the counsel for the petitioner interjected repeatedly to express her views. When the bench told the HC counsel to go on with his arguments unmindful of the repeated interjections, the counsel in a lighter vein remarked: "The interjections by the senior counsel for the petitioner are always delightful."  The petitioner's counsel immediately to...

The Debt Recovery Tribunal of Mumbai has ordered the promoters of Varun Industries to submit their passports and not leave the country without its permission. "The counsel appearing for the applicants (consortium of banks led by Indian Bank) submitted that defendants (promoters of Varun Industries) are making attempts to leave the country to avoid arrest and legal consequences of several cases and proceedings initiated by the creditors," said the tribunal's presiding officer, HV Subba Rao, in his order. The lenders had approached the tribunal to recover over Rs 1,900 crore in dues from the Mumbai-based steel maker. The banks had extended money to the company between 2007 and 2011 under various credit facilities, financial assistance and loans, which were payable till August 31, 2013. In its order on Friday, the tribunal directed Varun Industries' CMD Kiran Mehta, MD Kailash Agarwal and other key people in the company to submit their passports to the regi...

The Bombay high court has directed the Insurance Regulatory and Development Authority (IRDA) to consider issuing appropriate instructions to all insurance companies to inform policyholders about remedies available to them in case of rejection or part-settlement of their claims. A division bench of Chief Justice Mohit Shah and Justice BP Colabawalla directed the regulators also to consider asking risk firms to let policyholders know the reasons for its action on the claims. The directions were given on Tuesday during the hearing of a public interest litigation filed by activist Gaurang Damani. The PIL seeks directions to bring clarity in medical insurance documentation so that the end consumer knows exactly what amount to expect from the insurance company in case of a claim. During the hearing, Damani pointed out that a policyholder can approach the Grievance Redressal Cell of the insurance company concerned and thereafter file an appeal before an independent Ombudsman, bu...

The Hyderabad High Court has held that a person travelling in a goods transport vehicle as owner of the goods will be eligible to claim compensation from the insurance company. Justice U. Durga Prasad Rao was upholding an award passed by the chairman of Motor Vehicle Accidents Claim Tribunal of Ananthpur in directing United India Insurance Company Ltd to pay Rs 2 lakh to the family of Tammineni Mallikarjuna, who died in an accident. The father of the deceased submitted before the tribunal that his son, besides doing cloth business, was a paddy harvester and during October, 2000, he took his harvest to Nizamabad district for the paddy harvesting season. He told the tribunal that on October 26, 2000, his son engaged a van to transport the harvest from Nizamabad to Kesepalli in Ananthpur district and on the way driver of the van drove in a rash manner and failed to see an electric wire hanging across the road. The live wires on the outskirts of Kesepalli, touched the goods and his so...

The Madurai bench of the Madras high court on Friday upheld an order of a Motor Accidents Claim Tribunal, Trichy, awarding Rs 20.76 lakh to the family of a government school headmistress who died in an accident in 2006. While upholding the tribunal's order, the division bench of justices V Dhanapalan and V M Velumani dismissed an appeal filed by the Tamil Nadu State Transport Corporation (TNSTC), Pudukottai. The case pertains to the death of Lukkas Mary, who was working as headmistress at a panchayat middle school at Konnayampatti in Ponnamaravathi union in Pudukottai district. Mary died on November 13, 2006 while riding pillion on a two-wheeler with her friend Irudayraj Leo on Pudukottai-Manaparai Road. She was on her way to a bank when a TNSTC bus coming in the opposite direction dashed against the two-wheeler. Though Leo escaped with minor injuries, Mary fell on the road and was crushed by the rear wheels of the bus. Mary died on the spot. Claiming Rs 25 lakh as compens...

A housing society does not have to pay any capital gains tax when it sells additional floor space index (FSI) to a builder, according to a recent Bombay high court decision. Development Control Regulations (DCR), 1991, provide for grant of additional FSI if an existing building is redeveloped. The society can utilize it either for extension of the existing building, construction of a new building or even sell it to a builder. When the additional FSI was sold to a builder, it typically resulted in an endless bout of tax litigation, which will be put to rest with the Bombay high court order. This favourable order will bring cheer to many old housing societies that have entered into redevelopment agreements or plan to do so. Lower Parel's Sambhaji Nagar Coop Housing Society, owing to reconstruction of its old buildings, generated an additional FSI (as per DCR), which it sold to a builder for Rs 2.2 crore. Authorities sought to tax the sale proceeds as capital gains. The society...

Massage parlours, spas, therapeutic treatment, beauty parlours, wellness centres, unisex salons and health clubs - call them by any name, but police and other authorities cannot interfere in their functioning without first making a law either to permit or regulate such entities, the Madras high court ruled on Wednesday.  Justice V Ramasubramanian, coming to the rescue of a batch of petitions from those who promote this business in Chennai, said: "It is quite unfortunate that the very word 'massage' has come to be looked down upon due to the abuse of these centres by a few individuals. Therefore, it may be necessary for the government to regulate, by law, the industry and provide certain basic parameters."  He then said the authorities shall not, as a matter of routine and without any basis, conduct any raids and interfere with the business carried on by the petitioners.  He passed the orders after massage parlour and spa owners complained that they were being s...

In a landmark judgment the Supreme Court has sought to correct the trend of simultaneous assailment of a patent in different forums. The Hon'bleCourt held that simultaneous remedies to assail the same patent are not available under the Indian Patents Act and under Section 10 of the Code of Civil Procedure (CPC), 1908 read with Section 151 of the CPC. To give a short background, a dispute over certain Licensing agreements led to a long drawn legal struggle between Dr. Aloys Wobben and Enercon India Limited being fought in multiple forums. This long standing dispute between Dr. Aloys Wobben (Appellant) versus Yogesh Mehra (Respondent) came to the Supreme Court for resolving (2014 Indlaw SC 370). The appellant had filed 19 infringement suits, and the respondents had filed 23 revocation petitions. The respondents had also filed counter-claims to the patent infringement suits filed by the appellant. The main contentions that the Court dealt with were concerned with the issue of a p...

Public services like railways cannot be penalized if some equipments relating to comforts of passengers malfunction during journey, a consumer forum here has said while dismissing a senior citizen's plea against the Northern Railway. New Delhi District Consumer Disputes Redressal Forum, presided by C K Chaturvedi, dismissed the plea of one M Lalla against the Northern Railway, while noting that the fans were in working condition at the time of departure of the train. "The investigation report indicates that fans were in working condition at time of departure but became inoperative en route the journey. "Public services like railways cannot be penalized if some equipments relating to the comforts of passengers malfunction during journey," the forum said. In its order, the forum also noted that Lalla was helped by railway official, i.e. TTE in trying to repair defective fan though he was unsuccessful in his efforts. "If equipments were in an operative s...

Deciding a case of domestic violence, where the decree of divorce had been obtained subsequently, the Court held that an act of domestic violence once committed, subsequent decree of divorce will not absolve the liability of the respondent from the offence committed or to deny the benefit to which the aggrieved person is entitled under the Protection of Women from Domestic Violence Act, 2005 (DV Act) including monetary relief under Section 20, Child Custody under Section 21, Compensation under Section 22 and interim or ex parte order under Section 23 of the DV Act. In the present case, the appellant obtained an ex parte ‘Khula’ from Mufti under the Muslim Personal Law on 09.05.2008 and filed a petition under Section 12 of the DV Act on 29.09.2009 alleging that the respondent was not providing maintenance to her and her child under Sections 8 to 23 of the DV Act. The bench of Sudhansu Jyoti Mukhopadhaya and S.A. Bobde, JJ, considering the fact that the respondent had challenged the e...

Allowing the plea of the petitioner (minor appearing through her guardian) wanting to medically terminate her pregnancy that resulted due to rape being committed upon her, the Court directed the District Medical Officer, Hisar to constitute a committee of 2 doctors to examine her and get her pregnancy terminated if she is in the right state of health. The Court referring an earlier case on this point reiterated the directions stating that in case where a rape victim irrespective of the fact that whether she is major or minor, if found pregnant and does not want to retain the foetus, then such pregnancy must be treated as involving grave mental injury and medical assistance shall be provided and the feasibility of terminating such pregnancy shall be considered. In the instant case the victim’s request to medically terminate her pregnancy was rejected by the Court of JMIC, Hisar on the grounds that there is no legal provision to entertain such application. The petitioner was represent...

A consumer forum cannot decide whether there is negligence or deficiency in service on the part of public information officers (PIO) or other authorities under the Right to Information (RTI) Act, said the Tamil Nadu State Consumer Disputes Redressal Commission. In an order last month, a bench comprising commission president Justice (retd) R Regupathi, judicial member J Jayaram and member P Bakiyavathi said the Supreme Court had said the Consumer Protection Act was in addition to the provisions of other law "unless there was a clear bar." Whereas, the RTI Act had a provision which specifically said it was beyond the jurisdiction of courts. The matter relates to a petition filed by S Jeyaram who said that under the RTI Act, he had sought some information regarding Apollo Hospitals from the public information officer and deputy/under secretary of the health and family welfare department. As the PIO failed to furnish the details, he moved north Chennai district consumer disp...

The Supreme Court on Wednesday ruled that a mobile phone battery charger is an accessory to a phone and not a part of the cellphone, thereby subjecting it to a different tax rate. A bench of justices S.J. Mukhopadhaya and Madan B. Lokur held that a “battery charger cannot be held to be a composite part of the cellphone but is an independent product which can be sold separately, without selling the cell phone.” The judgment came in a dispute involving Nokia India Pvt. Ltd where the assessing authority held that the battery charger was an accessory chargeable to tax at the rate of 12.5%, and after including interest and penalty, demanded an additional Rs.2.16 crore from Nokia for the assessment year 2005-06 and Rs.3.1 crore for the assessment year 2006-07. While a concessional rate of tax at 4% applies to cellphones and parts, accessories are a separate item liable to be taxed at the general rate of 12.5% and not at the concessional rate applicable to the cell phones. Nokia argu...

A party to the arbitration proceedings cannot raise objections regarding jurisdiction of the tribunal midway, the Supreme Court stated in the judgment, M/s MSP Infrastructure Ltd vs M P Road Development Corporation Ltd. The disputes in this case were referred to arbitration and the tribunal partly allowed the claim of the contractor. The corporation appealed against it under the Arbitration and Conciliation Act before the district judge. He dismissed it as the appeal was filed two years late, calling the action absolutely unjust and unfair. However, the Madhya Pradesh high court allowed the corporation's appeal. The firm appealed to the Supreme Court, which quashed the high court order. Article referred: http://www.business-standard.com/article/printer-friendly-version?article_id=114121400629_1

If a motor vehicle is hypothecated to a finance company and the borrower does not insure it, the claim for compensation must be paid by the latter, and not the financier, the Supreme Court has held in the judgment, HDFC Bank Ltd vs Kumari Reshma. It set aside the Madhya Pradesh High Court view that it was the lender who was liable to pay compensation if the borrower does not insure the vehicle and meets with a road accident, raising claims by the victim. The high court relied on the term in the loan agreement that the bank was required to get the vehicle insured if the borrower failed, to or neglected to, get the vehicle insured. Overruling that view, the Supreme Court asserted that "the person in possession of the vehicle under the hypothecation agreement is the owner", according to the provisions of the Motor Vehicles Act. Though the bank was the registered owner of the vehicle along with the borrower, the latter was "in control and possession of the vehicle". If...