THE ORIENTAL INSURANCE CO. LTD. V. DICITEX FURNISHING LTD.

SC-Dismissing the appeal against the order of the Bombay HC,the Hon’ble SC opined that an application under Section 11(6) of the Arbitration and Conciliation Act, 1996 is in the form of a pleading which merely seeks an order of the court, for appointment of an arbitrator. It cannot be conclusive of the pleas or contentions that the claimant or the concerned party can take, in the arbitral proceedings. The court which is required to ensure that an arbitrable dispute exists, has to be prima facie convinced about the genuineness or credibility of the plea of coercion; it cannot be too particular about the nature of the plea, which necessarily has to be made and established in the substantive (arbitration) proceeding.-Hon'ble Justices Arun Mishra and S. Ravindra Bhat[13-11-2019]

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MANOHARAN V. STATE BY INSPECTOR OF POLICE, VARIETY HALL POLICE STATION, COIMBATORE

SC-Dismissing the review petition and upholding the conviction and death penalty, the Hon’ble SC observed that the two accused misused societal trust to hold as captive two innocent school-going children, one of whom was brutally raped and sodomised, and thereupon administered poison and finally, drowned by throwing them into a canal and this was indeed craftily planned and executed. The present offences are so grave as to shock the conscience of this Court and of society and would without doubt amount to rarest of the rare. It is no longer res integra that there can be no hard rule of not awarding death in cases based on circumstantial evidence owing to recent developments in medical science and the possibility of abuse by seasoned criminals.-Hon'ble Justices Rohinton Fali Nariman,Surya Kant and Sanjiv Khanna[07-11-2019]

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EBHA ARJUN JADEJA V. THE STATE OF GUJARAT

EBHA ARJUN JADEJA V. THE STATE OF GUJARAT

SC-Setting aside the order of the TADA Court,the Hon’ble SC held that non-compliance of Section 20-A(1) of  Terrorist and Disruptive Activities (Prevention) Act, 1987 is fatal and so the appellants have been discharged in so far as the offence under TADA Act is concerned. Where the information basically discloses an offence under TADA Act and the other offence is more in the nature of an ancillary offence then the information cannot be recorded without complying with the provisions of Section 20-A(1) of TADA Act. The language of Section 20-A is mandatory in nature and forbids the recording of information about the commission of offence under TADA Act by the police without prior approval of the District Superintendent of Police. -Hon'ble Justices Deepak Gupta and Aniruddha Bose[16-10-2019]

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UNION OF INDIA V. GAUTAM KHAITAN

UNION OF INDIA V. GAUTAM KHAITAN

SC-Directing the Delhi HC to decide the writ petition on its own merits, the Hon’ble SC observed that the penal provisions under Sections 50 and 51 of the Black Money Act would come into play only when an assessee has failed to take benefit of Sec. 59 and neither disclosed assets covered by the Black Money Act nor paid the tax and penalty thereon. The HC was not right in holding that, by the notification/order impugned before it, the penal provisions were made retrospectively applicable. Sub-sec. (3) of Sec. 1 of the Act, itself provides that save as otherwise provided in this Act, it shall come into force on 1st day of July, 2015.The assessment year in consideration was 2019-2020 and the previous year relevant to the assessment year was the year ending on 31.03.2019.-Hon'ble Justices Arun Mishra,M.R. Shah and B.R.Gavai[15-10-2019]
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R.SRINIVAS KUMAR V. R.SHAMETHA

R.SRINIVAS KUMAR V. R.SHAMETHA

SC-Allowing the application for divorce filed by the appellant-husband,the Hon’ble SC observed that the appellant-husband and the respondent-wife have been living separately for more than 22 years and it was not possible for the parties to live together.While protecting the interest of the respondent-wife to compensate her by way of lump sum permanent alimony, this is a fit case to exercise the powers under Article 142 of the Constitution of India and to dissolve the marriage between the parties. It reiterated that inherent powers under Article 142 has been exercised for dissolution of a marriage where the Court finds that the marriage is totally unworkable, emotionally dead, beyond salvage and has broken down irretrievably, even if the facts of the case do not provide a ground in law on which the divorce could be granted. -Hon'ble Justices Sanjay Kishan Kaul and M.R. Shah[04-10-2019]
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AMBALAL SARABHAI ENTERPRISES LTD. V. K.S. INFRASPACE LLP

AMBALAL SARABHAI ENTERPRISES LTD. V. K.S. INFRASPACE LLP

SC-Dismissing the appeal against the Gujarat HC,the Hon’ble SC observed that that in order to fall within Section 2(1)(c)(vii) of the Commercial Courts Act,2015 the immovable property must be “used exclusively” or “being used exclusively” in trade or commerce. There has been nothing on record to show that at the time when agreement to sell came to be executed in 2012, the property was being exclusively used in trade and commerce so as to bring the dispute within the ambit of sub-clause (vii) of Section 2(1)(c) of the Act. Merely because, the property is likely to be used in relation to trade and commerce, the same cannot be the ground to attract the jurisdiction of the Commercial Court.-Hon'ble Justices A.S.Bopanna and R.Banumthi [04-10-2019]
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DUNCANS INDUSTRIES LTD. V. A.J. AGROCHEM

DUNCANS INDUSTRIES LTD. V. A.J. AGROCHEM

SC-Confirming the order of the NCLAT which held that the insolvency petition under Sec. 9 of the Insolvency and Bankruptcy Code, 2016 initiated by the respondent-operation creditor shall be maintainable, the Hon’ble SC observed that the entire “corporate insolvency resolution process” as such cannot be equated with “winding up proceedings”. The provisions of the IBC would have an over-riding effect over the Tea Act, 1953 and that no prior consent of the Central Government before initiation of the proceedings under Sec. 7 or Sec. 9 of the IBC would be required and even without such consent of the Central Government, the insolvency proceedings under Sec. 7 or Sec. 9 of the IBC initiated by the operational creditor shall be maintainable.-Hon'ble Justices Arun Mishra,M.R. Shah and B.R. Gavai[04-10-2019]
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KERALA STATE BEVERAGES (M AND M) CORP LTD. V. P P SURESH AND ORS. ETC. ETC.

KERALA STATE BEVERAGES (M AND M) CORP LTD. V. P P SURESH AND ORS. ETC. ETC.

SC- The Hon’ble SC while allowing the appeal against the Kerala HC judgment, held that the decision taken by the Govt. in overriding public interest was a measure to strike a balance between the competing interest of the displaced Abkari workers and unemployed youth in the State of Kerala. The impairment of the fundamental rights of the Respondents due to the change in policy was not excessive and it cannot be said that the change in policy regarding re-employment of displaced abkari workers is disproportionate. If an announcement is made by the Govt. of a policy conferring benefit on a large number of people, but subsequently, due to overriding public interest, the benefits announced earlier are withdrawn, it is not expedient to provide individual opportunities to such innominate number of persons.-Hon'ble Justices L. Nageswara Rao and Hemant Gupta [04-10-2019]
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PUNJAB URBAN PLANNING AND DEVELOPMENT AUTHORITY (NOW GLADA) V. VIDYA CHETAL

SC-The Hon’ble SC overruled the case of HUDA vs. Sunita, (2005) 2 SCC 479,with the finding that it was rendered without considering any of the previous judgments of this Court and the objects of the Consumer Protection Act, 1986.It opined that the determination of the dispute concerning the validity of the imposition of a statutory due arising out of a “deficiency in service”, can be undertaken by the consumer fora as per the provisions of the Act. Not all statutory dues/exactions are amenable to the jurisdiction of the Consumer Forum, rather only those exactions which are exacted for a service rendered, would be amenable to the jurisdiction of the Consumer Forum.-Hon'ble Justices N.V.Ramana, Mohan M. Shantanagoudar and Ajay Rastogi[16-09-2019]
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JANARDAN DAGDU KHOMANE V. EKNATH BHIKU YADAV .

*SC*-Affirming the decision of the *Bombay HC*, the Hon’ble SC opined that the Trust, being a *public trust*,was rightly registered on 8.8.1984 and so *cannot be questioned*. The respondents became *deemed purchasers* and the right under *Section 32 of the Bombay Tenancy and Agricultural Lands Act, 1948* accrued to them on Tillers’ Day, that is, 1.4.1957. The respondents *cannot be divested of such right upon subsequent registration of the Trust*.A Trust for a religious purpose has the *right to own and acquire property, however, such property may be taken away by authority of law*.-Hon'ble Justices  R.Banumathi and Indira Banerjee[18-09-2019]
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MUNICIPAL COUNCIL NEEMUCH V. MAHADEO REAL ESTATE

SC-Setting aside the Madhya Pradesh HC order,the Hon’ble SC held that the HC while exercising its powers of judicial review of administrative action, could not have interfered with the decision unless it suffers from the vice of illegality, irrationality or procedural impropriety. The Commissioner, instead of blindly accepting the directions contained in the communication, acted in larger public interest so that the Municipal Council earns a higher revenue by enlarging the scope of the competition and the State Government has re-examined and reconsidered the issue and authorised the Commissioner to pass appropriate orders directing initiation of fresh tender process and so such orders were not illegal, improper or irrational.-Hon'ble Justices Arun Mishra,M.R. Shah and B.R. Gavai [17-09-2019]
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THE BIHAR STATE HOUSING BOARD V. RADHA BALLABH HEALTH CARE AND RESEARCH INSTITUTE (P) LTD

SC-Setting aside the order of the Patna HC,the Hon’ble SC held that the appellant as a State is required to act fairly in fixation of price for allotment of a plot. The order of the HC to direct the appellant to charge the price proportionate to the price advertised earlier has no legal basis and is a commercial decision taken by the appellant fixing the price of the plot. In the matter of fixation of price, the Board has a right to fix such price, more so, when such price was accepted by the respondent on three different occasions.The action of the respondent to dispute the allotment price after accepting the price is neither fair nor reasonable and so, cannot be accepted.-Hon'ble Justices L. Nageswara Rao and Hemant Gupta [13-09-2019]
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UNION OF INDIA V. SANDEEP KUMAR

SC-Finding that the Tribunal exceeded its jurisdiction while setting aside the order of conviction passed by the DCM,the Hon’ble SC held that Section 15 of the Armed Forces Tribunal Act, 2007 confers wide power on the Tribunal so as to allow an appeal against conviction by a Court Martial where the finding of the Court Martial is legally not sustainable due to any reason; the finding involves wrong decision on a question of law or there was a material irregularity in the course of the trial resulting in miscarriage of justice but such wide powers do not confer jurisdiction to the Tribunal to reverse the findings merely because it finds that different view is possible.-Hon'ble Justices L. Nageswara Rao and Hemant Gupta[13-09-2019]
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BAJARANG SHYAMSUNDER AGARWAL V. CENTRAL BANK OF INDIA

BAJARANG SHYAMSUNDER AGARWAL V. CENTRAL BANK OF INDIA

SC- Ordering that the appellant-tenant shall hand over the possession of the secured asset within 12 weeks of this order to the Assistant Registrar, who in turn shall deliver the same to the respondent no.1-bank,the Hon’ble SC dismissed the Appeal. The bank has produced multiple records to substantiate that this tenancy was created just to defeat the proceedings initiated under the SARFAESI Act and the appellant has failed to produce any evidence to substantiate his claim over the secured asset. So,the appellant cannot claim protection under the garb of the interim protection granted to him, ex parte, by solely relying upon the xerox of the rent receipts .Hence,the rejection of the stay application by the Chief Metropolitan Magistrate cannot be held to be erroneous.-Hon'ble Justices N.V.Ramana, Mohan M. Shantanagoudar and Indira Banerjee [11-09-2019]
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COMMISSIONER OF CUSTOMS, BANGALORE I V. M/S MOTOROLA INDIA LTD.

SC-Remitting the matter back to the HC,the Hon’ble SC held that the Karnataka HC was not justified in holding that the appeals are not maintainable under Section 130 of the Customs Act but are tenable before this Court under Section 130E of the Customs Act. The only question is as to whether the assessee has breached the conditions which are imposed by the notification for getting exemption from payment of the customs duty or not. The appeals do not involve any question of law of general public importance which would be applicable to a class or category of assessees as a whole. The question is purely inter-se between the parties and is required to be adjudicated upon the facts available.-Hon'ble Justices Arun Mishra,M.R. Shah and B.R. Gavai [05-09-2019]
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P. CHIDAMBARAM V. DIRECTORATE OF ENFORCEMENT

SC-While dismissing the appeal against the Delhi HC order, the Hon’ble SC opined that the grant of anticipatory bail to the appellant will hamper the investigation and it is not a fit case for exercise of discretion to grant anticipatory bail.Having regard to the nature of allegations and the stage of the investigation,the investigating agency has to be given sufficient freedom in the process of investigation and such Grant at the stage of investigation may frustrate the  agency in interrogating the accused and in collecting the useful information and also the materials which might have been concealed. Grant of anticipatory bail, particularly in economic offences would definitely hamper the effective investigation.-Hon'ble Justices R. Banumathi and A.S. Bopanna[05-09-2019]
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NCLT – Understanding National Company Law Tribunal and its power

National Company Law Tribunal is the outcome of the Eradi Committee. NCLT was intended to be introduced in the Indian legal system in 2002 under the framework of Companies Act, 1956 however, due to the litigation with respect to the constitutional validity of NCLT which went for over 10 years, therefore, it was notified under the Companies Act, 2013. It is a quasi-judicial authority incorporated for dealing with corporate disputes that are of civil nature arising under the Companies Act. However, a difference could be witnessed in the powers and functions of NCLT under the previous Companies Act and the 2013 Act. The constitutional validity of the NCLT and specified allied provisions contained in the Act were re-challenged. Supreme Court had preserved the constitutional validity of the NCLT, however, specific provisions were rendered as a violation of the constitutional principles.

NCLT works on the lines of a normal Court of law in the country and is obliged to fairly and without any biases determine the facts of each case and decide with matters in accordance with principles of natural justice and in the continuance of such decisions, offer conclusions from decisions in the form of orders. The orders so formed by NCLT could assist in resolving a situation, rectifying a wrong done by any corporate or levying penalties and costs and might alter the rights, obligations, duties or privileges of the concerned parties. The Tribunal isn’t required to adhere to the severe rules with respect to appreciation of any evidence or procedural law.

Major Functions of NCLT

Registration of Companies

The new Companies Act, 2013 has enabled questioning the legitimacy of companies because of specific procedural errors during incorporation and registration. NCLT has been empowered in taking several steps, from cancelling the registration of a company to dissolving any company. The Tribunal could even render the liability or charge of members to unlimited. With this approach, NCLT can de-register any company in specific situations when the registration certificate has been obtained by wrongful manner or illegal means under section 7(7) of the Companies Act, 2013.

Transfer of shares

NCLT is also empowered to hear grievances of rejection of companies in transferring shares and securities and under section 58- 59 of the Act which were at the outset were under the purview of the Company Law Board. Going back to Companies Act, 1956 the solution available for rejection of transmission or transfer were limited only to the shares and debentures of a company but as of now the prospect has been raised under the Companies Act, 2013 and the now covers all the securities which are issued by any company. 

Deposits

The Chapter V of the Act deals with deposits and was notified several times in 2014 and Company Law Board was the prime authority for taking up the cases under said chapter. Now, such powers under the chapter V of the Act have been vested with NCLT. The provisions with respect to the deposits under the Companies Act, 2013 were notified prior to the inception of the NCLT. Unhappy depositors now have a remedy of class actions suits for seeking remedy for the omissions and acts on part of the company that impacts their rights as depositors.

Power to investigate

As per the provision of the Companies Act, 2013 investigation about the affairs of the company could be ordered with the help of an application of 100 members whereas previously the application of 200 members was needed for the same. Moreover, if a person who isn’t related to a company and is able to persuade NCLT about the presence of conditions for ordering an investigation then NCLT has the power for ordering an investigation. An investigation which is ordered by the NCLT could be conducted within India or anywhere in the world. The provisions are drafted for offering and seeking help from the courts and investigation agencies and of foreign countries.

Freezing assets of a company

The NCLT isn’t just empowered to freezing the assets of a company for using them at a later stage when such company comes under investigation or scrutiny, such investigation could also be ordered on the request of others in specific conditions.

Converting a public limited company into a private limited company

Sections 13-18 of the Companies Act, 2013 read with rules control the conversion of a Public limited company into the Private limited company, such conversion needs an erstwhile confirmation from the NCLT. NCLT has the power under section 459 of the Act, for imposing specific conditions or restrictions and might subject granting approvals to such conditions.

source: https://cleartax.in/s/national-company-law-tribunal

M/S GEO MILLER & CO.PVT.LTD. V. CHAIRMAN, RAJASTHAN VIDYUT UTPADAN NIGAM LTD

SC-The Hon’ble SC affirmed the view of the Rajasthan HC that the entire dispute seems concocted so as to pursue a monetary claim against the respondents, taking advantage of the provisions of the Arbitration and Conciliation Act, 1996. The appellant’s own default in sleeping over his right for 14 years will not constitute a case of ‘undue hardship’ justifying extension of time under Section 43(3) of the 1996 Act or show ‘sufficient cause’ for condonation of delay under Section 5 of the Limitation Act. The appellant should have approached the Court for appointment of an arbitrator under Section 8(2) of the Indian Arbitration Act, 1940 within the appropriate limitation period.-Hon'ble Justices N.V. Ramana,Mohan M. Shantanagoudar and Ajay Rastogi [03-09-2019]
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M.J.THULSIRAMAN V. COMMR.

SC- The Hon’ble SC while dismissing the Appeal against the Madras HC held that the “Bakers Choultry”, and the rock inscription therein, constitute a “specific endowment” as defined under the Tamil Nadu Hindu Religious and Charitable Endowments Act, 1959, and the same is not the private property of the appellants. The contents of the rock inscription are sufficient to hold that there has been a valid divestment of the right to receive a certain part of the income, with the inscription also stipulating a bar on the right of the Manager to transfer the choultry.- Hon'ble Justices N.V. Ramana,Mohan M. Shantanagoudar and Ajay Rastogi [03-09-2019]
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SEP. SATGUR SINGH V. UNION OF INDIA

SC-Without finding any error in the order of discharge of the Appellant and dismissing the Appeal, the Hon’ble SC opined that the parameters laid down in para 5(a) of the Army Instructions dated December 28, 1988 stand satisfied. The appellant has not given any explanation of his absence from duty on seven occasions. The Commanding Officer has recorded that the appellant is a habitual offender. As the absence of duty was on several different occasions for which he was imposed punishment of imprisonment, hence, the order of discharge cannot be said to be unjustified.-Hon'ble Justices L.Nageswara Rao and Hemant Gupta [02-09-2019]
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SYED ZAINUL ABEDEEN V. RAJASTHAN BOARD OF MUSLIM WAQF.

SC-Dismissing the appeal and without finding any manifest error with the observation of the Courts that the suit filed by the appellant/plaintiff under Sec. 6 of the Wakf Act, 1954 was barred by limitation ,the Hon’ble SC held that once the property after the survey has been registered in the list of wakfs as Wakf-Al-Allah on the basis of the finding recorded by the Survey Commissioner in its report dated 2nd January, 1965, the dispute regarding the nature of wakfs registered is open to be examined only within the four corners of Sec. 6 of Act, 1954.The plea of the appellant that Sec. 6 has been erroneously referred to and the limitation has to be guided by Sec. 113 of the Limitation Act, is without substance and deserves rejection.-Hon'ble Justices N.V. Ramana and Ajay Rastogi [30-08-2019]
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EX.SEPOY (WASHERMAN) RAM KHILAWAN V. UNION OF INDIA

SC-The Hon’ble SC allowed the Appeal in a case challenging the orders passed by the Armed Forces Tribunal regarding the discharge of the Appellant from service. It held that the discharge is covered by clause (iii) of Rule 13(3)(III) of the Army Rules, 1954, as the discharge of the appellant was only on the ground of his medical unfitness for further service, therefore, he could not be invalidated out of service without the recommendation of the Invalidating Board. Such discharge which was not under the residual clause (v) but under clause (iii) of Rule 13(3)(III) of the Rules and which was made without reference to Invalidating Medical Board, is not legally sustainable.-Hon'ble Justices L.Nageswara Rao and Hemant Gupta [02-09-2019]
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M/S N RAMACHANDRA REDDY V. THE STATE OF TELANGANA

SC- Allowing the appeal in a case relating to invitation of bids for award of work of construction of BT Road in Mahabubabad District of Telangana State, the Hon’ble SC observed that the act of the Chief Engineer to call for a report from Superintending Engineer, Karimnagar was fair and not arbitrary. As the issue does not relate to strict construction of territorial jurisdiction, it is always open for the decision-making authority, to have a report from the independent authority, to arrive at the just decision.-Hon'ble Justices S. Abdul Nazeer and R.Subhash Reddy [28-08-2019]
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CHANDRAKANT BABAN MOTKARI . V. GOTIRAM LAXMAN MOTKARI(D) BY LRS.

SC-In a case relating to a property matter, the Hon’ble SC while dismissing the Appeal opined that the Kabuliyatnama was never in the name of the elder brother and the certificate under Sec. 32M of the Bombay Tenancy and Agricultural Lands Act, 1948 was granted in favour of the younger brother. The Agreement to Sell never matured into a sale deed and this was not a case where a suit was required to be stayed and the question of tenancy remitted to the Mamlatdar. The long drawn out proceedings initiated by the grandsons of Laxman were proceedings by “side wind”, which have dragged on for the last 16 years.-Hon'ble Justices Sanjay Kishan Kaul and K.M. Joseph[27-08-2019]
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NATIONAL HIGHWAYS AUTHORITY OF INDIA V. SAYEDABAD TEA CO. LTD. AND ORS

SC-Setting aside the Calcutta HC orders, in as case relating to appointment of an Arbitrator by the Central Government with respect to Sec. 3G(5) of the National Highways Act, 1956,the Hon’ble SC held that in view of the power being vested exclusively with the Central Government to appoint an Arbitrator under Sec. 3G(5) of the Act 1956, being a special enactment, the application filed under Sec. 11(6) of the Arbitration and Conciliation Act 1996 for appointment of an Arbitrator was not maintainable and provisions of the Act, 1996 could not be invoked for the purpose.-Hon'ble Justices N.V. Ramana,Mohan M. Shantanagoudar and Ajay Rastogi[27-08-2019]
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RAMESHWAR . V. THE STATE OF MADHYA PRADESH

SC-Affirming the conviction of appellant No.2-Balaram under Sec. 302 IPC read with Sec. 34 IPC and the sentence of life imprisonment imposed upon him, the Hon’ble SC opined that the presence of appellant No.2 has been established by consistent evidence of the eye-witnesses and he was armed with rifle and thus shared the common intention acting in concert with accused Rameshwar and has been proved to have acted in furtherance of the common intention. To invoke Section 34 IPC, it must be established that the criminal act was done by more than one person in furtherance of common intention of all. -Hon'ble Justices R.Banumathi and A.S. Bopanna[21-08-2019]
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M/S KUT ENERGY PVT.LTD V. THE AUTHORIZED OFFICER PUNJAB NATIONAL BANK

SC- Setting aside the order of the Himachal Pradesh HC and directing  that the amount deposited by the appellants in terms of the order dated 11.10.2017 be returned to them, the Hon’ble SC held that the deposit of Rs.40 crores in terms of the HC order made by the appellant was only to show the bona fides of the appellants when a revised offer was made by them. It was not towards satisfaction of the debt in question and that is precisely why the HC directed the deposit would be treated to be a deposit in the Registry of the HC. It reiterated the law laid down in Axis Bank that the ‘secured creditor’ would be entitled to proceed only against the ‘secured assets’ mentioned in the notice under Section 13(2) of the SARFAESI Act.-Hon'ble Justices Uday Umesh Lalit and Vineet Saran[20-08-2019]
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SALEEM AHMED V. STATE

SC-Allowing the petition filed under Sec. 482 of the CrPC and quashing the FIR,the Hon’ble SC opined that once the dispute in relation to recovery of outstanding amount was finally settled between the appellant and BSES amicably in Lok Adalat resulting in passing of the award in full and final satisfaction of the entire claim, there was neither any occasion and nor any basis to file FIR by the BSES against the appellant in respect of the cause which was subject matter of an award. The filing of FIR after passing of the award by the Lok Adalat was wholly unjust and not legally sustainable.-Hon'ble Justices Abhay Manohar Sapre and R. Subhash Reddy[19-08-2019]
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STATE OF RAJASTHAN V. SHIV DAYAL

SC- Allowing the appeal and remanding the case to the HC,the Hon’ble SC reiterated that if the Appellate Court affirms the finding, it is called “concurrent finding of fact” whereas if the finding is reversed, it is called "reversing finding". When any concurrent finding of fact is assailed in second appeal, the appellant is entitled to point out that it is bad in law because it was recorded de hors the pleadings or it was based on no evidence or it was based on misreading of material documentary evidence or it was recorded against any provision of law and lastly, the decision is one which no Judge acting judicially could reasonably have reached.-Hon'ble Justices Abhay Manohar Sapre and R. Subhash Reddy[14-08-2019]
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THE PRINCIPAL COMMISSIONER OF INCOME TAX 4 MUMBAI V. M/S S.G. ASIA HOLDINGS (INDIA) PVT. LTD

SC- In a case relating to assessment proceedings wherein the respondent was directed to furnish details about the parent company and the rate of brokerage, the Hon’ble SC affirmed the view of the tribunal that the transfer pricing adjustment made by the Assessing Officer was contrary to the mandatory instructions issued by the Central Board of Direct Taxes in its Instruction No.3/2003 dated 20.05.2003 and by not making reference to the TPO, the AO had breached the mandatory instructions issued by the CBDT. It would therefore be upto the authorities and the Commissioner concerned to consider the matter in terms of Sub-Sec. (1) of Sec. 92CA of Income Tax Act, 1961.-Hon'ble Justices Uday Umesh Lalit and Vineet Saran[13-08-2019]
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VINOD KUMAR V. ASHOK KUMAR GANDHI

SC-The Hon’ble SC did not find any good ground to refer the judgment of this Court in Satyawati Sharma (Dead) by LRs. Vs. UOI for reconsideration by a larger Bench. It observed that the case of Satyawati  Sharma which held that sec. 14(1)(e) of the Delhi Rent Control Act,1958  is violative of the doctrine of equality embodied in Article 14 of the Constitution insofar as it discriminates between the premises let for residential and non-residential purposes when the same are required bona fide by the landlord for occupation for himself or for any member of his family dependent on him and restricts the latter's right to seek eviction of the tenant from the premises let for residential purposes only, cannot be held to be per incuriam.-Hon'ble Justices Ashok Bhushan and K.M. Joseph[05-08-2019]
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ASST. PROVIDENT FUND COMMISSIONER EPFO, BAREILLY V. M/S U P STATE WAREHOUSING CORP

SC-The Hon’ble SC remanding the matter to the Allahabad HC for deciding the Corporation's writ petition afresh on merits keeping in view the definition of "employee'' as defined under Sec. 2(f) of the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952, held that the definition of "employee" under the Industrial Disputes Act, 1947 Act is not identical to the one defined under Sec. 2(f) of the Act in question and secondly, the object of these acts is not the same. The issue was to be decided independently and de hors the proceedings decided under the ID Act.-Hon'ble Justices Abhay Manohar Sapre and R. Subhash Reddy[14-08-2019]
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KANWALJIT SINGH V. NATIONAL INSURANCE COMPANY LTD.

SC-In a case relating to the extent of the liability of the Insurance Company with regard to individual claim under Family Mediclaim Policy, the Hon’ble SC affirmed that the maximum claim which could be payable in the present case would be 50% of the sum insured under the Policy for the medical treatment of one member of the family, which was Master Jasnoor Singh. The claim could not have been repudiated by the Insurance Company as there was no pre-existing disease when the initial individual Mediclaim Policy was taken in the year 2007-2008 and it was regularly renewed up to the year 2014-2015.-Hon'ble Justices Uday Umesh Lalit and Vineet Saran[14-08-2019]
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WAINGANGA BAHUDDESHIYA VIKAS SANSTHA THR. PRESIDENT B.B. KARANJEKAR V. KU. JAYA

SC-Setting aside the Bombay HC order,the Hon’ble SC observed that the appointment of respondent no. 1 is categorically on ad-hoc basis till such time full time Lecturer is appointed. The appointment of respondent No. 1 was not on probation but, it was purely ad-hoc appointment and the Management has kept right to terminate the services during ad-hoc period on account of unsatisfactory work.- Hon'ble Justices L. Nageswara Rao and Hemant Gupta [09-08-2019]
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THE DIRECTOR OF HORTICULTURE V. PRAVAT KUMAR DASH

SC-In a case relating to appointment to the post of gardeners, the Hon’ble SC stated that selection of the candidates for training as Gardeners was not by way of transparent procedure nor there was any commitment to appoint candidates who have completed training, therefore, even if a candidate has completed training, he cannot seek right of employment unless such posts are advertised and filled up by giving opportunity to all similarly situated candidates .The order of the Tribunal and the HC, directing the State to appoint the applicants as Gardeners is beyond their jurisdiction vested in the HC as there cannot be any direction for making appointment to the public post in such a manner.- Hon'ble Justices L. Nageswara Rao and Hemant Gupta [09-08-2019]
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CHANDIGARH ADMINISTRATION V. HARI RAM

SC-Setting aside the order of the Punjab and Haryana HC, in an appeal filed by the Chandigarh Administration, the Hon’ble SC observed that the slump in the business cannot be the reason for default in payment of the lease rent and the ground rent. It directed that the Administration shall confirm the allotment if the amount ordered is paid within six months but failure to do so will entitle the Administration to proceed with eviction in accordance with law.- Hon'ble Justices R.Banumathi and A.S. Bopanna [06-08-2019]
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R.JAYAPAL V. THE STATE OF TAMIL NADU

SC-Altering the conviction of the appellant under Section 302 IPC to the one under Part-I of Sec. 304 IPC, the Hon’ble SC held that the act of the appellant leading to the death was with the intention of causing such bodily injury as is likely to cause death. It extended the benefit of Exception 4 of Sec. 300 IPC to the appellant as the incident in question took place without any premeditation, in a sudden fight in the heat of passion upon a sudden quarrel, when the deceased attempted entry into his house; and the appellant did neither take any undue advantage nor acted in a cruel or unusual manner.-Hon'ble Justices Abhay Manohar Sapre and Dinesh Maheshwari [09-08-2019]
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M/S SHAHI AND ASSOCIATES V. STATE OF U.P.

SC-Restoring the interest awarded by the Arbitrator in accordance with Sec. 31(7)(b) of the Arbitration and Conciliation Act,1996, the Hon’ble SC held that though the agreement was earlier to the date of coming into force of the Act of 1996, the proceedings admittedly commenced in the year 1999 and were conducted in accordance with the Act of 1996. If that be so, para 7-A of Sec. 24 of the U.P. Amendment Act has no application to the case at hand and so both the HC and the District Judge were not justified in reducing the rate of interest by following the U.P. Amendment Act.-Hon'ble Justices Arun Mishra, S. Abdul Nazeer and M.R. Shah[08-08-2019]
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MALLIKARJUN V. STATE OF KARNATAKA

SC-The Hon’ble SC while confirming the conviction of the accused No.1 and 2,observed  that there was no inordinate delay in the receipt of FIR in the court and the findings of the trial court and HC that the delay in lodging the complaint and receipt of FIR in the court have been properly explained, do not suffer from infirmity. It stated that the conviction is based upon proper appreciation of evidence and the reasonings are well balanced.-Hon'ble Justices R.Banumathi and A.S. Bopanna [08-08-2019]
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MAHESH KUMAR V. STATE OF HARYANA

SC-While setting aside the conviction of the appellant in an appeal against the Punjab & Haraya HC decision, the Hon’ble SC observed that the prosecution failed to prove either the demand of dowry or that any such demand was raised soon before the death of the deceased. Hence, the essential ingredients of offence under Sec. 304-B of IPC were not proved by the prosecution. It even failed to prove the initial presumption under Sec. 113-B of the Evidence Act and the allegations levelled against the appellant beyond reasonable doubt.-Hon'ble Justices L.Nageswara Rao and Hemant Gupta [07-08-2019]
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KATHI DAVID RAJU V. THE STATE OF ANDHRA PRADESH & ANR.

SC-While allowing the appeal in a case with regard to obtaining false caste certificate, the Hon’ble SC opined that it was too early to request for conduct of DNA test without carrying out substantial investigation by the police authorities. The Additional Junior Civil Judge also failed to notice that in the investigation conducted by the Investigating Authority no such materials have been brought on the basis of which it could have been opined that conducting DNA test is necessary for the appellant on his mother and two brothers.-Hon'ble Justices Ashok Bhushan and Navin Sinha[05-08-2019]
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DR. SRIDIP CHATTERJEE V. DR. GOPA CHAKRABORTY

SC-In a case relating to selection and appointment of appellant to the post of Assistant Professor in Yoga Therapy of the Jadavpur University, the Hon’ble SC reinstated the appellant in service  and observed that both the Selection and Equivalence Committee has found the appellant’s  Diploma as the one satisfying the requirement of the advertisement. Once the Experts have taken a decision that the appellant meets the eligibility conditions of the advertisement, the Court could not have interfered with and set aside the appointment of the appellant.-Hon'ble Justices L.Nageswara Rao and Hemant Gupta [06-08-2019]
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SHASHI BHUSAN PRASAD V. INSPECTOR GENERAL CENTRAL INDUSTRIAL SECURITY FORCE & ORS.

The Hon’ble SC without interfering with the decision of the Orissa HC observed that Criminal and Departmental Proceedings are entirely different. In criminal law, burden of proof is on the prosecution and unless the prosecution is able to prove the guilt of the accused beyond reasonable doubt, he cannot be convicted by a Court of law whereas in the departmental enquiry, penalty can be imposed on the delinquent on a finding recorded on the basis of ‘preponderance of probability’.- Hon'ble Justices N.V. Ramana,Mohan M. Shantanagoudar and Ajay Rastogi [01-08-2019]
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CHILAKAMARTHI VENKATESWARLU & ANR. V. STATE OF ANDHRA PRADESH & ANR.

SC- Affirming the decision of the Hyderabad HC which had refused to quash the criminal complaint, the Hon’ble SC observed that the power to quash the proceedings under Sec.482 of the CrPC can be done only in rare cases and is to be generally exercised when there is no material to proceed against the Petitioners even if the allegations in the complaint are prima facie accepted as true. This power should not be exercised to stifle legitimate prosecution. -Hon'ble Justices Dr. Dhananjaya Y. Chandrachud and Indira Banerjee [31-07-2019]
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VIJAY PANDEY V. STATE OF UTTAR PRADESH

SC-In a case relating to the Narcotic Drugs and Psychotropic Substances Act,the Hon’ble SC while acquitting the appellant opined that the mere production of a laboratory report that the sample tested was narcotics cannot be conclusive proof by itself. The sample seized and that tested have to be co-related. The failure of the prosecution in the present case to relate the seized sample with that seized from the appellant makes the case no different from failure to produce the seized sample itself.-Hon'ble Justices Ashok Bhushan and Navin Sinha[30-07-2019]
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ZENITH DRUGS & ALLIED AGENCIES PVT. LTD. REPRESENTED BY ITS MANAGING DIRECTOR, SHRI UDAY KRISHNA PAUL V. M/S. NICHOLAS PIRAMAL INDIA LTD.

SC-Setting aside the Guwahati HC order,the Hon’ble SC held that the parties can be referred to arbitration in an application filed under Sec.8 of the Arbitration and Conciliation Act only if the subject matter of the action before the judicial authority relates to dispute which is the subject of the arbitration agreement. Since the respondent has raised the plea that the compromise decree is vitiated by fraud, the merits of such a plea could be decided only by the Civil Court and the parties cannot be referred to arbitration. Hon'ble Justices  R. Banumathi and A.S. Bopanna [30-07-2019]
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Mauji Ram V. State of Uttar Pradesh & Anr.

SC-The appeal against the Allahabad HC order has been allowed with the observation that the HC committed jurisdictional error in passing the impugned order because while passing it the HC did not assign any reason as to on what grounds, even though of a prima facie nature, it considered just and proper to grant bail to the respondents. It must appear from a perusal of the order that the Court has applied its mind to the relevant facts in the light of the material filed by the prosecution at the time of consideration of bail application.-Hon'ble Justices Abhay Manohar Sapre and Indu Malhotra[29-07-2019]
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STATE BANK OF INDIA & ORS. V. ATINDRA NATH BHATTACHARYYA & ANR.

SC-The opportunity of hearing granted to the respondent, which was the subject matter of appeal, has been set aside and the appeal has been allowed with the observation that once the respondent has failed to avail of opportunity of hearing granted, the Bank cannot be directed to give another opportunity for the sake of justice. The respondent avoided availing the said opportunity when offered. Once opportunity has been granted to the respondent, he is not entitled to another on the ground of compassion. The delaying tactics cannot be rewarded in such a manner.-Hon'ble Justices L. Nageswara Rao and Hemant Gupta [25-07-2019]
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BRAHMANI RIVER PELLETS LIMITED V. KAMACHI INDUSTRIES LIMITED

While setting aside the Madras HC order,the Hon’ble SC observed that when the parties have agreed to have the “venue” of arbitration at Bhubaneswar, the Madras HC erred in assuming the jurisdiction under Sec.11(6) of the Arbitration and Conciliation Act, 1996.Where the contract specifies the jurisdiction of the court at a particular place, only such court will have the jurisdiction to deal with the matter and parties intended to exclude all other courts.Non-use of words like “exclusive jurisdiction”, “only”, “exclusive”, “alone” is not decisive and does not make any material difference.- Hon'ble Justices  R.Banumathi and A.S.Bopanna [25-07-2019]
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Sri A.M.C.S. Swamy, ADE/DPE/Hyd (Central) V. Mehdi Agah Karbalai & Anr.

SC-Setting aside the Hyderabad HC order, the Hon’ble SC observed that when there is express provision in the Special Act empowering the Special Court to take cognizance of an offence without the accused being committed, it cannot be said that taking cognizance of offence by Special Court is in violation of Sec. 193 of the CrPC,1973. The Govt. had already issued notification notifying the 1st Additional District Judge’s Court as a Special Court and under Sec. 151 of the Electricity Act, 2003, the Special Court is empowered to take cognizance without there being an order of committal as contemplated under Sec. 193 of the CrPC.-Hon'ble Justices R. Banumathi and R. Subhash Reddy [23-07-2019]
Read the full judgment with iDRAF (Issue,Decision,Reasoning,Arguments,Facts)-https://www.legitquest.com/sri-amcs-swamy,-adedpehyd-(central)-vs-mehdi-agah-karbalai-and-anr

Vinod Bhaiyalal Jain & Ors. V. Wadhwani Parmeshwari Cold Storage Pvt. Ltd.Through its Director & Anr.

SC-The Hon’ble SC observed that the award passed by the Arbitrator was not sustainable and the learned District Judge was justified in entertaining the petition under Sec. 34 of the Arbitration and Conciliation Act, 1996 to set aside the award. There was a reasonable basis for the appellants to make a claim that the Arbitrator would not be fair to them even if not biased and propriety demanded that the Arbitrator should have recused in the present facts; but failed to do so.-Hon'ble Justices R. Banumathi and A.S.Bopanna [24-07-2019]
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Section 138 NI Act: Delay In Filing The Complaint Can Be Condoned If Sufficient Cause Is Shown In The Complaint [Read Judgment]

Section 138 NI Act: Delay In Filing The Complaint Can Be Condoned If Sufficient Cause Is Shown In The Complaint [Read Judgment]: The Supreme Court has observed that cognizance of a complaint filed under Section 138 of the Negotiable Instrument Act can be taken by the court even after the prescribed period, if the...

GST Evaders Can Be Arrested: SC Upholds Telangana HC Judgment

Supreme Court has dismissed a plea challenging Telangana High Court judgment that held that a person can be arrested by the competent authority in cases of Goods and Service Tax (GST) evasion. 

The vacation bench of Chief Justice of India Ranjan Gogoi and Justice Aniruddha Bose, dismissing the Special Leave Petition, said that it is not inclined to interfere. 

The Division bench of the Telangana High Court, in April, comprising of V. Ramasubramanian and Justice P. Keshava Rao had dismissed a batch of writ petitions seeking protection from arrest for alleged tax evasion. The challenge was against the summons issued by Superintendent (Anti-Evasion) of the Hyderabad GST Commissionerate under the Central Goods and Services Tax Act, 2017. The bench observed that sub Section (1) of Section 69 of the Act empowers the Commissioner to order the arrest of a person, when such a person is believed to have committed a cognizable and non bailable offence. 

It had said: "If reasons to believe are recorded in the files, we do not think it is necessary to record those reasons in the authorization for arrest under Section 69(1) of the CGST Act. Since Section 69(1) of the CGST Act, 2017 specifically uses the words “reasons to believe”, in contrast to the words “reasons to be recorded” appearing in Section 41A(3) of Cr.P.C., we think that it is enough if the reasons are found in the file, though not disclosed in the order authorizing the arrest." 

The state had submitted before the High Court that the petitioners before it were allegedly involved in incorporating several partnership firms and had claimed input tax credit on the basis of certain invoices, without there being any actual physical receipt of goods. It had alleged that the fraudulent input tax credit claimed by them was to the tune of Rs 224.05 crore. 

The High court had also rejected the contention that here cannot be an arrest even before adjudication or assessment. 

It had said: "To say that a prosecution can be launched only after the completion of the assessment, goes contrary to Section 132 of the CGST Act, 2017. The list of offences included in sub Section (1) of Section 132 of CGST Act, 2017 have no co relation to assessment. Issue of invoices or bills without supply of goods and the availing of ITC by using such invoices or bills, are made offences under clauses (b) and (c) of sub Section (1) of Section 132 of the CGST Act. The prosecutions for these offences do not depend upon the completion of assessment." 

The bench also did not favour the argument raised by the petitioners that since all the offences under the Act are compoundable under sub Section (1) of Section 138 of the CGST Act, 2017, subject to the restrictions contained in the proviso thereto and that therefore, there is no necessity to arrest a person for the alleged commission of an offence which is compoundable. The court also had observed that the furthering of enquiry/ investigation is not the only object of arrest.

https://www.livelaw.in/top-stories/gst-evaders-can-be-arrested-14530

Whether Section 143-A Of The Negotiable Instruments Act, 1881 Has Retrospective Application Or Not ?

Preface: 

The party who commits default in payment can be sued by a payee in the civil court by filing suit for recovery of money. However, the special provision of Section 138 under the Negotiable Instruments Act, 1881 (hereinafter referred to as the NIA) was inserted with effect from 01.04.1989 vide the Banking Public Financial Institutions and Negotiable Instruments Laws (Amendment) Act, 1988. The object of the NIA is to enhance the acceptability of the cheques in settlement of liabilities by making the drawer liable for penalties in case of bouncing of cheques due to insufficiency of funds in the accounts.

That by virtue of the Amendment Act No. 20 of 2018 in the NIA, the legislature introduced Section 143-A and Section 148providing for "Power to direct interim compensation" and "Power of Appellate Court to order payment pending appeal against conviction" respectively.

Key Aspects- Section 143-A of the NIA:

i.                 Section 143-A of the NIA deals with order of payment of interim compensation; the upper limit is maximum 20% of the cheque amount.

ii.                The order as regards payment of interim compensation is made directly in favour of the complainant.

iii.               If the order of payment is made, the accused is to pay interim compensation within a period of 60 days from the date of the order and for special reason, further 30 days can be given, hence, within a total of 90 days from the date of the order.

iv.               Stage at which application under Section 143-A of the NIA can be filed: (a) In summary trials or summons case, where the accused pleads not guilty to the accusation made in the complaint, and, (b)In any other case,upon framing of charge.

v.                Sub-section (3) of Section 143-A of the NIA states that the interim compensation shall be paid within 60 days from the date of the order passed under Sub-section (1) of Section 143-A of the NIA. However, Sub-section (1) of Section 143-A of the NIA states that the court may order the drawer to pay interim compensation. So, it leaves discretion with the trial court to pass such order of interim compensation and if such interim compensation is directed to be paid, then the ceiling limit under Sub-section (2) of Section 143-A of the NIA is 20% of the cheque amount.

vi.               Sub-section (4) of Section 143-A of the NIA states about recovery of money with interest from the complainant in case of acquittal of the accused within a period of 60 days or maximum 90 days from the date of order of acquittal of the accused.

vii.             Sub-section (5) of Section 143-A of the NIA states that interim compensation payable by the accused can be recovered by the complainant as if it were a fine under Section 421 of the Criminal Procedure Code, 1973.

Key Aspects- Section 148 of the NIA:

i.                 Section 148 of the NIA states that in an appeal by the drawer/accused against conviction under Section 138 of the NIA, the Appellate Court may order the appellant/drawer to deposit such sum which shall be a minimum of 20% of the fine or compensation awarded by the trial court.

ii.                 The Appellate Court may direct the release of the amount which is deposited by the appellant/drawerin the Appellate Court to the complainant/respondent, at any time during the pendency of the appeal.

iii.               If the order of payment is made, the appellant/drawer is to deposit such sum (minimum of 20% of the fine or compensation awarded by the trial court) within a period of 60 days from the date of the order and for special reason, further 30 days can be given, hence, within 90 days from the date of the order.

iv.               The order directing the deposit of money in the Appellate Court can be passed at any time during the pendency of the appeal.

v.                As per the proviso to Section 148 of the NIA, if the appellant/drawer is acquitted, the Appellate Court shall direct the complainant/respondent to repay to the appellant/drawer the amount so released, with interest (at the bank rate as published by the Reserve Bank of India, prevalent at the beginning of the relevant financial year) within 60 days from the date of the order, or within such further period not exceeding 30 days as may be directed by the Appellate Court on sufficient cause being shown by the complainant/respondent.

Comparing Section 143-A and Section 148 of the NIA:

In the matter of: Ajay Vinodchandra Shah V/s State of Maharashtra, Criminal Writ Petition No. 258 of 2019, High Court of Bombay, Date of Decision: 14.03.2019, Coram: MridulaBhatkar, J., in Para 13 and Para 14 it was held as follows:

"13. On comparison of the language used in sections 143A and 148, one finds a difference. U/s 143A, the accused is yet to face a trial. Under sub-section (2) thereof, the interim compensation under sub-section (1) shall not exceed twenty percent of the amount of cheque. However, under section 148, it is stated that the Court may order the appellant to deposit such sum which shall be a minimum of twenty percent of the fine. These clauses in these two sections reflect the intention of the Legislature that a person at the stage of trial is always considered innocent till he is found guilty and, therefore, the ceiling of 20% compensation is mentioned. However, in the appeal, when the first Court holds the accused guilty and thus, once he is convicted, then, the appellate Court is given the power to pass order directing the accused to deposit the amount which shall be a minimum of 20% of the fine or compensation awarded by the trial Court. It is further stated in section 148 that the amount payable under this sub-section (sic) shall be in addition to any interim compensation paid by the appellant under section 143A. 14. The Legislature has also taken care of the accused if at all he is not held guilty and acquitted either at the trial or in the appeal. The sub-section (4) of section 143A and the proviso to section 148 state about the repayment of the amount by the complainant to the accused. In the event of acquittal, the said amount also to be paid within 60 days from the date of the order…"

Section 143-A of the NIA operates retrospectively?

In the matter of: Punjab Tin Supply Co. V/s Central Government, (1984) 1 SCC 206, it was observed that, all laws which affect substantive rights generally operate prospectively and there is a presumption against their retrospectivity if they affect vested rights and obligations unless the legislative intent is clear and compulsive; such retrospective effect may be given where there are express words giving retrospective effect or where the language used necessarily implies that such retrospective operation is intended. Hence, the question whether a statutory provision has retrospective effect or not depends primarily on the language in which it is couched. If the language is clear and unambiguous, effect will have to be given to the provision in question in accordance with its tenor; however, if the language is not clear then the court has to decide whether in the light of the surrounding circumstances retrospective effect should be given to the statutory provision or not.

According to Section 5 of the General Clauses Act, 1897, any Act of Parliament comes into operation on the day on which it receives the assent of the President. Unless it is expressed to become operational on any other date and unless a contrary intention is expressed, the Act of Parliament comes into effect qua all cases on the day of its commencement.

View Taken by the Hon'ble High Court of Bombay: In the matter of Ajay Vinodchandra Shah (Supra), the Hon'ble High Court of Bombay observed that (Para 12 of the report):

"… It is incorrect to accept that it is to be made not (sic)applicable to the cases which are filed only after 01.09.2018 and not applicable to the cases pending earlier in the trial as well as appellate Court. Huge number of cases under section 138 of the Act are pending in the Courts. In these cases, if the plea is recorded or charge is not framed, then the trial Court can invoke its powers under Section 143-A after 1.9.2018 and can impose interim compensation which shall not exceed 20% of the amount of cheque. Same is the case in appeals. If the appeals are pending, the Court can pass interim orders under section 148…"

Thus, according to the view taken by the Hon'ble High Court of Bombay, Section 143-A and Section 148 of the NIA do not operate prospectively.

View Taken by the Hon'ble High Court of Punjab & Haryana:

In the matter of: Ginni Garments & Anr V/s Sethi Garments, CRR No. 9872-2018 (O&M), High Court of Punjab & Haryana, Date of Decision: 04.04.2019, Coram: Rajbir Sehrawat, J., it was held that:

i.                 Whether Section 143-A and Section 148 of the NIA have prospective or retrospective operation depends upon the determination whether these provisions are substantive in nature or are merely procedural. If these provisions are substantive in nature then these provisions cannot be applied retrospectively to the pending cases, however, if these provisions are procedural in nature then they have to be applied to all the cases, including the ones pending before the court on the date, the amendment was enforced.

ii.                A bare perusal of Section 143-A of the NIA shows that Section 143-A of the NIA has given power to the trial court to order the drawer of the cheque to pay interim compensation (maximum of 20% of the cheque amount) to the complainant, where the accused has not pleaded guilty of the accusation made against him. Moreover, as per Section 143-A of the NIA if interim compensation is not paid within 60 days (or maximum of 90 days) from the order of the court granting interim compensation, then the interim compensation can be recovered by the complainant from the drawer/accused under Section 421 of the Criminal Procedure Code, 1973, as if it were a 'fine' imposed upon the drawer/accused.Section 143-A of the NIA casts a substantive obligation upon the drawer/accused.

iii.               Section 143-A of the NIA is not a procedural provision as it intends to create a 'stand-alone liability' for the drawer/accused towards the complainant which has to be discharged by the drawer/accused when the matter is still pending for adjudication before the trial court.

iv.               Although the provision of Section 143-A of the NIA cannot be applied to the pending trials, however, the situation regarding Section 148 of the NIA is drastically different. Section 148 of the NIA does not, in any way, affects the substantive right of the accused, to defend himself or to prosecute his appeal. Section 148 of the NIA categorically provides that in case the appellant/drawer is acquitted by the Appellate Court, then, the amount awarded by the Appellate Court as interim compensation shall be returned to him, by the complainant along with interest.

v.                 When the case reaches before the Appellate Court, the appellant/drawer has already acquired a status of 'convict', who has already been found guilty of his conduct and sentenced by the trial court. In case the trial court imposes a fine then making the appellant/drawer pay that amount does not affect his substantive right, rather it is a matter of procedure only. Moreover, in case the trial court imposes a fine, which can be up to twice the amount of the cheque and which can be treated as compensation to be paid to the complainant, in that situation, liability of the appellant/drawer has already been determined by the trial court and the liability to pay the amount to the complainant already exists at the time when the appellant/drawer comes before the Appellate Court.

vi.               Section 148 of the NIA is to govern all the appeals pending on the date on which it was enforced and/or appeals filed thereafter.

View Taken by the Hon'ble High Court of Allahabad:

In the matter of: Vivek Kumar Negi V/s State of U.P. &Anr., Application under Section 482 of the Cr.P.C. No. 11055 of 2019, High Court of Allahabad, Date of Decision: 11.04.2019, Coram: Arvind Kumar Mishra, J., the question that came for adjudication before the Hon'ble Court was this:

"… whether the amendment brought and incorporated under Section 143 (A) (1) of the Negotiable Instruments Act, 1881 (hereinafter referred to as 'the Act') is applicable retrospectively nor (sic) not?"

Answering the question framed above, the Hon'ble Court observed as follows:

"… In so far as amendment is concerned, the amendment is of procedural nature and not of substantive nature. Moreover, in matters of applicability of the amendment [under Section 143 (A)] proceedings launched in the matters pending prior to the incorporation of the amendment there is no express bar in the Act. It being so, the amendment will be applicable even to the proceeding pending prior to the date of incorporation of the amendment as Section 143 (A) in the matters involving provisions of the Negotiable Instruments Act, 1881…"

Thus, according to the view taken by the Hon'ble High Court of Allahabad, Section 143-A of the NIA is to operate retrospectively.

View Taken by the Hon'ble High Court of Karnataka:

In the matter of: Sri V. Narasimha Murthy V/s Sri Santhosh,

 I.A. No. 3 of 2018 in Criminal Revision Petition No. 425 of 2018, High Court of Karnataka, Date of Decision: 18.02.2019,

Coram: B.A. Patil, J.,

it was held that:

i.                 According to Section 148 of the NIA, the Appellate Court may order the accused to deposit a minimum of 20% of the fine amount or the compensation awarded by the trial court and if the said amount is deposited within 60 days from the date of such order, the Appellate Court may direct the release of the amount so deposited by the accused in favour of the complainant during the pendency of the appeal. The proviso to Section 148 of the NIA states that while releasing the amount so deposited, the complainant has to be directed to repay the said amount in the event of acquittal of the accused with interest at bank rate which was prevailing during the said period.

ii.                It is a cardinal principle of construction that every statute is prima facie prospective in nature, unless it is expressly or by necessary implication made to have retrospective operation.

iii.               Section 148 of the NIA has been enacted to protect the interest of the complainant and to provide relief to the complainant. Further, Section 148 of the NIA has been enacted to discourage filing of frivolous appeals. Thus, Section 148 of the NIA has to be given wider interpretation and not a restricted/pedantic interpretation.

iv.               Section 148 of the NIA has to be given retrospective effect.Section 148 of the NIA is to govern all the appeals pending on the date on which it was enforced and/or appeals filed thereafter.

Afternote:

In the matter of: G.J. Raja V/s Tejraj Surana,

Petition for Special Leave to Appeal (Crl.) No. 3342/2019, the Hon'ble Supreme Court of India, formulated the following question of law for adjudication:

"… whether Section 143-A introduced by the Amendment Act No. 20 of 2018 in the Negotiable Instruments Act, 1881 has retrospective application or not?"

The aforenoted matter is still pending adjudication before the Hon'ble Supreme Court of India with the next date of hearing being: 01.07.2019.

Source: https://www.livelaw.in/columns/whether-section-143-a-in-the-negotiable-instruments-act-14507

Bar Council of Delhi directs Deloitte, EY, KPMG and PwC not to offer legal services

In a double-whammy of sorts for the Big Four audit-cum-consultancy firms – Deloitte, EY, KPMG and PwC – the Bar Council of Delhi on Friday directed the four firms to refrain from providing legal services to clients till further notice.

The move comes after a complaint was filed by the Society of Indian Law Firms (SILF), representing around 100 Indian law firms. SILF said in its complaint that the Big Four were actually accounting firms, but are engaged in "doing law practice". SILF had filed a similar complaint to the Bar Council in 2015 alleging that the Big Four were resorting to "unauthorised practice of law" in violation of the Advocates Act.

The Bar Council order asked the four firms to provide a list of advocates on their rolls. The order copy said that while Deloitte and KPMG had filed their response to the complaint, PwC and EY had asked for more time to submit their response. The Council has deferred the matter for further hearing to July 12. It has asked the four firms to refrain from the practice until further orders.

The development comes at a time when the Big Four firms are under the scanner for audit-related practices. The recent meltdown at ILFS group has put the spotlight on statutory auditors.

Many in the chartered accountant fraternity were of the view that there were grey areas over jurisdiction of non-litigation related legal services. In their earlier response in 2015, one of the Big Four firms had said that they were not "engaged in the practice of law". A source in one of the Big Four firms reiterated the same stand that they do not represent any legal firm. "We do not practice in any area that only advocates are supposed to practice," he added.

There has been growing angst in the legal fraternity that multinational audit-cum-consultancy firms have over the years hired lawyers in large numbers to offer legal advice to clients. “It is a turf battle between lawyers and chartered accountants,” noted a senior advocate and chartered accountant. There are many lawyers – registered with the Bar Council – who offer tax advice to clients.

Meanwhile, the Institute of Chartered Accountants refused to get drawn into this fight and did not offer any official comment to Bar Council’s order.



Source: https://www.business-standard.com/article/companies/bar-council-of-delhi-directs-big-four-not-to-offer-legal-services-119050301212_1.htm

Amrapali Group Committed First Degree Crime by Cheating Home Buyers: Supreme Court

Amrapali Group has committed a "first-degree crime" by cheating thousands of home buyers and no matter how powerful the people behind this mess they will be booked and prosecuted, the Supreme Court said Tuesday.

"Fate is written on the wall" for the group and its directors, the top court said while declining to hear their claims of no wrongdoing.

The embattled real estate firm "cheated everybody including home buyers, banks and authorities and indulged in cartelization to prevent the Debt Recovery Tribunal from auctioning its unencumbered properties", it said. "The limit of your fraud touched the sky."

A bench of Justices Arun Mishra and U U Lalit said it cannot believe the justification given by Amrapali for alleged diversion of funds of over Rs 3,500 crore, looking at its dubious conduct.

"You have committed a first-degree crime by cheating thousands of home buyers. We should have cancelled the licences of statutory auditors of Amrapali for indulging in fraudulent practise long back and sent them to jail.

"We are saying in open court that there are powerful people behind this mess but no matter how powerful they are, we will book them and prosecute them. We are not going to spare anybody," the bench said.

The hard-hitting remarks of the bench came after advocates appearing for the group, said there was no wrongdoing done on their part and there was no diversion of Rs 3,500 crore as claimed by the court-appointed forensic auditors.

Luthra said forensic auditors have erred on various aspects in their report like they had claimed that not a single penny was invested by directors of Amrapali but in reality, Rs 60 to Rs 70 crore was put in by them.

"We have to believe the forensic auditors and their report looking at your dubious conduct. We believe them. You (Amrapali) have yourself admitted in your earlier affidavit that Rs 2,990 crore of home buyers money was diverted and now you are claiming that there was no diversion. You have made a peon as your director and he purchases shares worth crores of rupees for Amrapali. Is this not correct," the bench said.

Luthra said the group acted in a bona fide manner and in the interest of home buyers but the problems started after the company ran into litigation.

Amrapali Group claimed that they had received Rs 11,057 crore from the home buyers and they have constructed five projects in Indirapuram of Delhi-NCR and gave their possession to home buyers.

"Your (Amrapali Group and its directors) fate is written on the wall. We are not inclined to hear your bona fide claims looking at your dubious conduct," the bench said.

At the outset, the bench also pulled up Bank of Baroda and other lenders, who have given hefty loans to Amrapali Group for failing to monitor and control the diversion and usage of funds by the realty firms.

The day-long hearing remained inconclusive and would continue tomorrow.

Two forensic auditors -- Pawan Agrawal and Ravi Bhatia -- in their fresh report said yesterday that Amrapali has diverted over Rs 3,500 crore of home buyers money to different projects.

The top court had allowed the I-T department and the EOW to access the report of forensic auditors in their probe but restrained them from summoning them.

Forensic auditors in their fresh supplementary report pointed out that promoters of Amrapali did not invest a single penny in real estate firm and home buyers money was used for the construction of high rise buildings.