Legal News & Views

The nettlesome problem of provident fund for casual construction workers returned to the Delhi High Court with the Builders Association of India and several construction firms alleging that they should not be compelled to pay their contribution because the workers change places and could not be traced. The court had in the past asked the government to put in place a workable scheme to benefit the labourers who change employers and work place very often. Since this has not been done satisfactorily, the employers should not be compelled to contribute to the fund, they argued. The high court dismissed their petitions stating that the problem of logistics in finding the workers and paying them is different from the liability of the employers. The argument that unless the provident fund authorities and the government could show that they had a "mechanism as per which the workmen whose job was portable could avail the benefit of the money lying to their credit all over India, no liabili...

The Supreme Court has quashed the Delhi High Court order and upheld the cancellation of the tender by South Delhi Municipal Corporation for civil works stating that the corporation, "being the custodian of public finance, took its decision objectively with bona fide intention to serve the best interest of the public in general. It has not committed any wrong in cancelling its earlier tender notice and ordering e-tender afresh." Two contractors bid the lowest in the first tender, but it was cancelled for "administrative reasons" and to fetch better price. The high court ruled that the cancellation was illegal and arbitrary. The Supreme Court stated that the corporation has the power to do so and there was no favouritism. Article referred: http://www.business-standard.com/article/opinion/iprs-acquired-get-tax-benefit-sc-115102500743_1.html

Disciplinary proceedings against a manager can be continued even if the bank in which he was working amalgamated with another, the Supreme Court stated in its judgment last week in the appeal, Jagdish Lal vs Punjab National Bank (PNB). This assistant general manager was working in the Hindustan Commercial Bank Ltd. It was merged with Punjab National Bank. During his tenure in the earlier bank, the manager was facing disciplinary proceedings for flouting lending norms. In spite of that PNB absorbed him because the Supreme Court had passed an order that transferee banks are obliged to take in managers of merged banks. PNB, however, revived the charge-sheet against the manager. He challenged it on several grounds. Primarily he argued that the proceedings against him cannot be revived merely because he is under a new employer. He also contended that he was holding a higher rank in the old bank, while a lower ranking manager issued the fresh charge-sheet. The court rejected all such argumen...

The Supreme Court stated last week that a company cannot claim the right to a trade mark if it registers the name but does not use it for a long time. It would be assumed that the company, by its lethargic conduct, had abandoned its right. In this case, Neon Laboratories Ltd vs Medical Technologies Ltd, two pharma companies were disputing over the trade mark of similar sounding brand names. Medical Technologies argued that its product named Profol for the compound Propofol was being confused with that of Neon’s Rofol. Therefore it filed a suit alleging ‘passing off’. The trial court and the Gujarat High Court passed injunctions in its favour. Therefore, Neon approached Supreme Court. It dismissed the appeal stating that Neon had registered the name in 1992 but started marketing its brand only in 2004, much after the rival company launched its product in the market. The judgment stated that “t he Trade Marks Act does not permit the hoarding of or appropriation without utilisation of a t...

In a setback to Adel Landmarks Limited, a real estate enterprise, the SEBI directed the company and its directors to refund the money collected from the public under its ‘pre-booking of plots’ scheme. Adel, without registration and approval under SEBI’s Collective Investment Schemes (CIS) Regulations, collected the money from the public for purchase /acquisition of future land for development of residential colonies. Adel contended that it collected the money for pre-booking of plots being developed on the land already owned by it either directly or through subsidiaries. The SEBI through its whole time member, on the other hand, examining the agreements by Adel with perspective buyers and other materials on record found that Adel was pooling money to purchase future land which amounts to scheme/arrangement under S. 11AA(2)(i) of the SEBI Act, 1992. He observed that the Company has solicited investments with a promise of refund of investment amount along with return in the nature of c...

Talking about the considerations to be kept in mind while determining the nature of a purchase transaction of immovable property by a husband in the name of his wife, the bench of Ranjan Gogoi and N.V. Ramana, JJ said that purchase of property by a husband in the name of his wife is a specie of Benami purchase that had been prevalent in India since ancient times on account of the position of Hindu women to succession until the enactment of the Hindu Succession Act, 1956 and the amendments made thereto from time to time. Noticing that such practice has been recognised recognition in the explanation clause to Section 3 of the Benami Transactions (Prohibition) Act, 1988, the Court said that such purchase was made by the husband in order to provide the wife with a secured life in the event of the death of the husband as a Hindu widow had a limited right to the estate of the deceased husband under the Hindu Women’s Right to Property Act, 1937. The Court held that this feature needs to be k...

The Supreme Court has held that no copyright exists on the "title" of a literary work while quashing a criminal case against the producer of a Bollywood movie. A bench comprising justices MB Lokur and SA Bobde passed the order on an appeal filed by Krishika Lulla and others against an order of the Bombay high court which had refused to quash a complaint filed by writer Shyam Vithalrao Devkatta. "No copyright subsists in the title of a literary work and a plaintiff or a complainant is not entitled to relief on such basis except in an action for passing off or in respect of a registered trademark comprising such titles. Article referred: http://timesofindia.indiatimes.com/india/No-copyright-exists-on-title-of-literary-work-Supreme-Court/articleshow/49482533.cms?

The Gujarat high court has held that a stepmother or stepfather is not liable to maintain a stepchild because the provisions of Section 125 of the CrPC make it obligatory for kin to maintain only blood relations. Justice J B Pardiwala acknowledged that there is no provision in law to make it incumbent on a person to maintain a stepchild born to his spouse from another partner. He said there was need for a law to look after such helpless children in the absence of biological parents. The HC perused numerous orders of other high courts and the Supreme Court — these had relied largely on Hindu Maintenance Act, Sections 125 and 488 of the CrPC and even Hindu scriptures like the Laws of Manu — to find support for a child getting maintenance from step-parents. Section 125 of the CrPC has a provision for maintenance of a legitimate or illegitimate child but not for a child of others. Article referred: http://timesofindia.indiatimes.com/india/Step-parent-not-liable-to-maintain-chil...

A woman doesn't have a claim to her partner's home over that of his wife, the Delhi high court has said in an important ruling on legal rights in a live-in relationship. Justice Najmi Waziri on Tuesday came to the rescue of a 78-year-old widow, a US citizen, by restoring to her possession of a Greater Kailash property owned by her husband. The senior citizen, who now lives in the US, married an Indian businessman in 1963 and was forced to move court when she was ousted from her matrimonial home following her husband's death last year. "A live-in or mistress or survivor in a bigamous relationship does not enjoy the status of marriage, hence she does not get the protection of law for maintenance," Justice Waziri said referring to Supreme Court rulings. The court made it clear that the US citizen, being the legally wedded wife of the businessman, had a better claim to his property over that of the live in partner. Dealing with the other woman's claim to the ho...

While upholding the repudiation of the claim of the complainant by LIC on the ground of suppression of material facts, as proper, NCDRC observed that a contract between the parties falls in the category of contract uberrimae fidei, meaning a contract of utmost good faith on the part of the assured. When information on a specific aspect is asked for in the proposal form, an assured is under a solemn obligation to make a true and full disclosure of the information on the subject which is within his knowledge. It is not for the proposer to determine whether the information sought for, is material for the purpose of the policy or not. Earlier the deceased obtained LIC policy of Rs.1,00,000/- which commenced from July 9, 1994. He passed away due to cerebro-vascular accident in the hospital on 14.11.1994. The parents of the deceased filed the claim before LIC, which repudiated the claim stating that the assured was suffering from infective hepatitis and was hospitalized for treatment prior t...

While deciding on a question whether the amendment carried out in Negotiable Instruments Act, 1881 on 15.06.2015 would have a retrospective operation or would be prospective in nature and if such amendment has a retrospective effect whether the complaint filed by the petitioner could have been saved, the bench of Goutum Bhaduri J, observed that the said amendment is of procedural law and not substantive law, therefore it will have a retrospective effect dealing with procedure. The Court relied on T. Kaliamurthi v. Five Gori Thaikkal Wakf, (2008) 9 SCC 306 wherein it was held that “it is well settled that no statute shall be construed to have retrospective operation until its language is such that would require such conclusion. The Exception to this rule is enactments dealing with procedure”. Article referred: http://sccblog.azurewebsites.net/post/2015/09/07/amendment-of-section-142-of-n-i-act-is-in-realm-of-procedural-law-therefore-has-a-retrospective-effect/

While deciding the constitutionality of the new Rule 27A and condition 9A under the head Conditions in Forms FL 3 introduced via amendment of the Kerala Foreign Liquor Rules dated 9-12-2013 which prohibits women from being employed “in any capacity for serving liquor on the licensed premises’, a bench of D.S. Naidu J held that Rule 27A of Kerala Foreign Liquor Rules as well as condition 9 A under the head Conditions in Forms FL 3 fall foul of the Constitutional scheme of gender equality as has been spelt out in Articles 14, 15 (1); & (2) and 16 (1); & (2) of the Constitution of India, and hence is unconstitutional. In the matter of constitutionality of the new Rule introduced via amendment of the Kerala Foreign Liquor Rules dated 9-12-2013, 2015 SCC OnLine Ker 19753, decided on 17.08.2015

In a significant judgment, a bench comprising of G.S. Patel, J dismissed an application for injunction in a defamation action brought by the National Stock Exchange of India (NSE) for an article published in a financial news website. The article in question was based on a letter written by an anonymous whistleblower which alleged that that insiders at the stock exchange had given unfair advantage to certain high-frequency traders. The Court noted that the journalist who wrote the article, had made repeated attempts to contact the NSE chairman and other NSE members before publishing the article but she had received no response. Instead the journalist and editor of the website were slapped with a 100 crore defamation suit and an injunction seeking removal of the articles. Dismissing the injunction plea , the Court observed that defamation law is not to be used to gag, to silence, to suppress and to subjugate. The Court went on to say that  “the freedom of speech and expression is a...

While dismissing the revision petition filed by Godrej and Boyce Manufacturing Co. Ltd. challenging the orders of District Forum and State Commission, which were passed in favour of the complainant, NCDRC imposed punitive costs in the sum of Rs one lakh on Godrej and Boyce Manufacturing Co. Ltd. for charging more amount than the maximum retail price (MRP) from the consumer. Godrej and Boyce Manufacturing Co. Ltd. v. Anagha Vilas Kulkarni, , decided on August 21, 2015

The Central Information Commission has directed the Home Ministry to ask the authorities of the country's jails to prepare lists of undertrial prisoners, who have completed half of the maximum period of imprisonment prescribed for their alleged crime and supposed to be released, and inform them about their date of release. The CIC order has come on the plea of an RTI applicant who had sought information from Tihar Jail authorities whether Undertrial Review Committee (URC), which is set up to decide on release of such undertrial inmates, have been constituted but did not get complete information. Article referred: http://articles.economictimes.indiatimes.com/2015-09-01/news/66108006_1_undertrial-prisoners-information-commissioner-sridhar-acharyulu-cic-order

The security market regulator imposed penalty of Rs. 4,50,000 on M/s. Khatau Exim Limited (the company) for non compliance with Takeover Regulation, 1997 and Sec. 15A(b) of the SEBI Act, 1992. The company was found guilty for not to make annual filing to the stock Exchanges where the company’s shares were listed in respect of the holdings of the promoters or person(s) having control over the company. The adjudicating officer of SEBI while considering the quantum of penalty relied on the decisions of the Supreme Court in SEBI v.  Shri Ram Mutual Fund in which it was ruled that, “penalty is attracted as soon as the contravention of the statutory obligation as contemplated by the Act and the Regulations is established and hence the intention of the parties committing such violation becomes wholly irrelevant…”. Adjudication Order in the matter of M/s. Khatau Exim Limited, ORDER NO.AK/AO-74/2015, decided on 22.10.2015

NCDRC has upheld the repudiation of claim by the insurance company in a case of theft of vehicle on the ground that respondent was not having valid driving licence at the time of incident and he had also not taken ignition keys of the car when he went for urination, hence violating the terms of policy. National Insurance Co. Ltd. v. Ram Singh Gurjar, 2015 SCC OnLine NCDRC 2291, decided on 18-9-2015

Dealing with an important question that whether continuance of criminal proceedings in case of loans taken from banks on the basis of forged documents would be an unnecessary load on the criminal justice dispensation system once the parties have entered into a settlement, the bench of Dipak Misra and P.C. Pantt, JJ held that a grave criminal offence or serious economic offence or for that matter the offence that has the potentiality to create a dent in the financial health of the institutions, is not to be quashed on the ground that there is delay in trial or the principle that when the matter has been settled it should be quashed to avoid the load on the system.

An unchaste wife is not entitled for permanent alimony, ruled the Bombay High Court while setting aside an order of a family court granting Rs1,500 as permanent alimony to the wife to be paid by the husband while granting him divorce. A division bench of justices Vasanti Naik and AS I Cheema — of the Nagpur bench of the High Court — while setting aside the family court order said: "It is apparent on reading of the provisions for maintenance under various enactments that an unchaste wife or a wife living in adultery would not be entitled to permanent alimony." Article referred: http://www.dnaindia.com/mumbai/report-unchaste-wife-not-entitled-for-permanent-alimony-bombay-high-court-2130433