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The Lawyer's Digest: Supreme Court Judgments passed in March 2020

A summary of Judgments passed by the Supreme Court in March, 2020.

The Lawyer's Digest is a collection of concise summaries of all the judgments passed by the Supreme Court of India over the course of a month.

Topics have been sub-divided into areas of law including arbitration, criminal law, consumer law, service and administrative law, etc. for ease of reading.

Here are the summaries of judgments passed in March 2020.

Arbitration

In Bank of Baroda v. Kotak Mahindra Bank Ltd., the Court had to determine the limitation for filing an application for execution of a foreign decree of a reciprocating country (“United Kingdom”) in India. Noting that the Limitation Act 1963 was a self-contained code, the Bench observed that the concept of “cause of action” was not applicable to execution petitions but only to civil suit. It was held as follows:

  1. A decree becomes enforceable the day it is passed and thus Section 44A does not create a fresh limitation period as it was only an enabling provision, allowing the District Court to execute the decree as if the decree had been passed by the self-same Indian District Court.

  2. As per private international law and commentators such as Dicey, procedural laws would be governed by the forum country (India) and the substantive laws would be governed by the cause country (UK). Further noting that limitation was increasingly being treated as substantive law, the Bench concluded that the limitation law of the cause country (UK) should be applied in the forum country (India). If the law of the forum country was silent with regard to the limitation period prescribed for execution of a foreign decree, then, naturally, the limitation of the cause country would apply.

  3. Article 136 was applicable to judgments by Indian courts only and not foreign courts. Article 137 was applicable for execution of foreign decrees. Limitation period starts running in the following scenarios:

a) In a situation where the decree holder does not take any steps for execution of the decree in the cause country during the period of limitation prescribed in the cause country, the decree holder cannot be allowed to execute the decree in a forum country. This is in line with treating limitation as an issue of substantive law, governed by the cause country.

b) Another situation would be where the decree holder takes “steps-in-aid” to execute the decree in the cause country but the proceedings go on for a while and the decree is partially satisfied for want of the sufficiency of the judgment debtor’s assets in the cause country. In such a situation Section 44A would accrue after the execution proceedings in the cause country are finalised and the “application under Section 44A of the CPC can be filed within 3 years of the finalisation of the execution proceedings in the cause country as prescribed by Article 137 of the Act.”

[Key words: Sections 13, 44A, 47 CPC and Order 21 CPC, execution of foreign decree] [Coram: Deepak Gupta, J., Aniruddha Bose, J.]

In Hindustan Construction Company Ltd. vs. NHPC Ltd, the Court relied on its recent judgment in BGS SGS Soma JV vs. NHPC Ltd. 2019 SCC OnLine SC 1585 to reiterate that for the application of Section 42 of Arbitration & Conciliation Act, 1996, the first application must be to a court which has jurisdiction to decide such application. Thus where a seat is designated in an agreement, the courts of the seat alone have jurisdiction, would require that all applications under Part I be made only in the court where the seat is located, and that court alone then has jurisdiction over the arbitral proceedings and all subsequent applications arising out of the arbitral agreement. [Key Words: Section 42, Seat of arbitration] [Coram: R.F. Narinman J., S. Ravindra Bhat J., V. Ramsubramanian J.]

Criminal Law

In Bhagwan Singh v. State of Uttarakhand while relying on Kunwar Pal v. State of Uttarakhand (2014) 12 SCC 434 the Court held that the appellant while firing in celebration at the roof with a licensed gun at his son’s wedding did not take reasonable precautions to avoid likely consequence of causing fatal injuries to the persons present in close circuit. Resultantly the Court held that the appellant has the requisite knowledge essential for constituting the offence of culpable homicide under Section 299 IPC and punishable under Section 304 Part 2. [Key Words: Culpable homicide] [Coram: S.A. Bobde CJI, B.R. Gavai J., Surya Kant J.]

In Ankit Ashok Jalan vs. Union of India, the petitioner being detained under Section 3(1) of the Conservation of Foreign Exchange and Prevention of Smuggling Activities Act 1974 (“COFEPOSA Act”), challenged the decision of the Detaining Authority stating that his representation would be considered only after the receipt of the opinion of the Central Advisory Board. The two-judge majority of the three-judge bench relied on the Kamleshkumar Ishwardas Patel vs. Union of India and others (1995) 4 SCC 51 to state that where the detention order is made inter alia under Section 3 of the COFEPOSA Act by an officer specially empowered for that purpose either by the Central Government or the State Government, the person detained has a right to make a representation to the said officer (in addition to the right to make the representation to the State Government and the Central Government) and the said officer is obliged to consider the said representation; and the failure on his part to do so would result in denial of the right conferred on the person detained to make a representation. The Court distinguished K.M. Abdulla Kunhi and B.L.Abdul Khader v. Union of India and others (1991) 1 SCC 476, noting that it the case was decided when Sushila Mafatlal Shah (1988) 4 SCC 490 still held the field wherein the role of a specially empowered officer who passed the detaining order was limited and any representation to her could only be considered by the appropriate Government. However, the position of the law has been clarified in Kamleskumar, which set out the power of the specially empowered officer to independently revoke her order of detention. The two-judge majority also considered Section 8 (e) of COFEPOSA Act mandating the proceedings of the Advisory Board, save its opinion, shall be confidential, to note a specially empowered officer is by statutory intent not privy to the report of the Advisory Board. Thus, the two-judge majority held that the Detaining Authority ought to have considered the representation independently and without waiting for the report of the Advisory Board. Justice Hemant Gupta, in his minority opinion, stated that the consideration for revocation of a detention order is limited to examining whether the order conforms with the provisions of law whereas the recommendation of the Advisory Board is on the sufficiency of material for detention, which alone is either confirmed or not accepted by the appropriate Government.[Key Words: Article 22 (5), COFEPOSA Act 1974, preventive detention, delay in consideration of representation] [Coram: U. U. Lalit. J., Indu Malhotra J., Hemant Gupta, J]

In M/s New Era Fabrics Ltd. vs Bhanumati Keshrichand Jhaveri & Ors, the applicant filed an application under Section 340 r/w Section 195 of the CrPC seeking institution of criminal proceedings against the Petitioner for giving false evidence before the Court. The Court examined the auditor’s report as filed as evidence before the trial court and the same document with purportedly with interpolations before the Court in the SLP, observed that there was a prima facie case made out for initiation of proceedings for perjury, The Court cited In Re: Suo Motu Proceedings against R. Karuppan, Advocate (2001) 5 SCC 289 and directed the Secretary General of the Court to take requite action for prosecution against the Petitioner company and the deponent. [Key Words: Perjury, Section 193, Section 199 IPC] [Coram: Mohan M. Shantanagoudar, J., R. Subash Reddy, J.]

In K.Virupaksha & Anr. Vs The State of Karnataka & Anr, the Appellants assailed the order of the High Court dismissing the Appellants’ petition under Section 482 CrPC seeking the quashing of the order of the Judicial Magistrate directing the registration of an FIR against the Appellants. The Court noted that the complainant had filed the complaint alleging collusion of the bank officer/Appellants with the auction-purchaser in the auction of his secured asset in terms of Section 13 and Section 14 of the SARFAESI Act. The Court reiterated Authorised Officer Indian Overseas Bank & Anr. Vs. Ashok SawMill (2009) 8 SCC 366 to state that the SARFAESI Act being a complete code, contained checks and balances in Section 17 to prevent misuse of the provisions of the said Act. The Court noted the Complainant had approached the High Court under Article 226 of the Constitution assailing the auction notice. Suffering dismissal, the Complainant preferred an intra-court appeal to the Division Bench, where also he suffered dismissal and it was only then that the Complainant filed an application under Section 17 of the SARAFESI Act along with an application seeking condonation of delay. It is after this application was dismissed that the Complainant filed the subject complaint, where he also alleged reduced disbursal of the loan amount for the first time. The Court concluded that the complaint appears to be an intimidatory tactic and an abuse of process of law and directed the setting aside of the order of the High Court and also quashed the complaint and the FIR with respect to the Appellants. [Key Words: Section 482 CrPC, SARFAESI Act, Abuse of process] [Coram: R. Banumathi J., S. Abdul Nazeer J., A.S. Bopanna J.]

In Shri Satish Kumar & Anr. Vs State of Himachal Pradesh & Anr, the Appellants challenged the judgement of the High Court overturning the acquittal and convicting them under Section 302 r/w 34 of the IPC as well as Section 25 and 27 of the Arms Act. The Court allowed the appeal, relying on Chandrappa and others v. State of Karnataka (2007) 4 SCC 415 to state that while exercising jurisdiction under Section 389 of the CrPC, when a trial court has recorded a finding of not proving guilt, the appellate court should interfere only if the findings are perverse and not possible by any reasonable person. The Court held that the High Court had erred in interfering with the findings of the trial court even though those were a possible conclusion on the basis of the evidence of record. Noting that the disclosure statements were not proved and in the absence of evidence as to who fired the fatal shot, the accused were rightly granted the benefit of doubt by the trial court. [Key Words: Section 387 CrPC, Interference in acquittal, Sec. 302 IPC] [Coram: U. U. Lalit, J., Indu Malhotra, J., Hemant Gupta, J.]

In Dilip Shaw @ Sanatan & Anr. Vs The State of West Bengal, deciding an appeal from conviction by the High Court overturning the acquittal by the trial court, under Section 149 and Section 304, Part I of the IPC, the Court noted that where the same group of assailants had attacked the victims a short time before the secondary attack by hurling bombs at the victim, small deviation in the statements of the witness as to the exact place of the attack would not separate the accused who hurled bombs from the rest of the assailants who were all assembled with weapons of assault and participated in the assault which was the same chain of events and could be said to have a common object. The court however modified the conviction under Section 304 Part I to Section 304 Part II after noting that the bombs were thrown at the members of the victims family from the rear without targeting anyone in specific and consequently modified the sentence from 10 years of rigours imprisonment to 5 years of rigorous imprisonment while also enhancing the fine from Rs.5000 to Rs. 50,0000 which was directed to be paid to the legal representatives of the deceased victim. [Key Words: Section 149, Section 304, Part I of the IPC] [Coram: Deepak Gupta, J., Aniruddha Bose J.]

In Parvat Singh & Ors vs State of Madhya Pradesh, the Court set aside the conviction of the appellants under Section 302 r/w Section 149 of the IPC, wherein the appellants were originally Accused no. 2-5. The Court noted that the High Court had erred in upholding the conviction relying on the statement of the sole eyewitness despite improvements and contradiction in her statements. The Court observed that it being a moonless night at the time of the incident and the eye-witness claims to have seen the appellants under torchlight, although no torch is recovered from the scene. The Court also observed that the witness had stated that the appellants had held lathis only in her statement under Section 161 of the CrPC where as the same was not recorded in her statement before the court. The Court also noted that her statements as to where the assailants fled to after the incident were contradictory and seen together, the appellants were deserving of benefit of doubt. The Court noted that the conviction of the original accused no. 1 being confirmed by this Court could not be held against the appellants since the evidence against the accused no.1 did not suffer similar contradictions and improvements. [Key Words: Section 302 r/w Section 149 IPC] [Coram: Ashok Bhushan J., M.R.Shah J.]

In Than Kunwar Vs State of Haryana, the Court relied on State of Punjab v. Baljinder Singh (2019) 10 SCC 473, to reiterate that where no recovery is made from the person of the accused, compliance of Section 50 of the Narcotics Drugs and Psychotropic Substances Act 1985 (‘NDPS Act’) is not required. The Court distinguished the present case from Jitendra (2004) 10 SCC 562 noting that the non-production of the seized material in Jitendra assumed significance only in light of other circumstances such as the Punch witnesses turning hostile, and had no application in the present case. The Court referred Mohinder Singh v. State of Punjab (2018) 18 SCC 540 to state that the relevance of production of seized material is to satisfy the court as to the quantity of the material i.e. for determination if it was a commercial quantity or otherwise. The Court noted that the appellant had neither disputed the quantity nor the objected to non-production of the seized material before the trial court. The Court dismissed the appeal. [Key Words: Section 50 NDPS Act, non-production of seized material] [Coram: Ashok Bhushan, J., K.M. Joseph, J.]

In Samta Naidu & Anr. Vs State of Madhya Pradesh, the Court reiterated Pramatha Nath Taluqdar vs. Saroj Sarkar AIR 1962 SC 876, Jatinder Singh (2001) 2 SCC 570 and Poonam Chand Jain (2010) 2 SCC 631 stating that although there is no bar to the entertainment of a second complaint after an order of dismissal of the first complaint is passed under Section 203 CrPC, a second complaint shall be entertained only in exceptional circumstances where the previous complaint was dismissed on incomplete record, on a misunderstanding of the nature of the complaint, it was manifestly absurd or where new facts which could not have been brought on record with reasonable diligence, have been adduced. The Court noted that in the present case, the first complaint itself being filed an year after the incident and none of the material relied upon in the second complaint are such that they could not be procured earlier, the High Court erred in holding the second complaint to be maintainable and thus allowed the appeals. [Key Words: Maintainability of second complaint, Section 203 CrPC] [Coram: U.U. Lalit J., Vineet Saran J.]

In Satishkumar Nyalchand Shah Vs State of Gujrat & Ors., the Court relied on Dinubhai Baghabhai Solanki v. State of Gujarat (2014) 4 SCC 626, Narender G.Goel v. State of Maharasthra (2009) 6 SCC 65 to state that since nothing in Section 173(8) CrPC to suggest the court is obliged to hear the accused before any direction for further investigation is made, a proposed accused against whom further investigation is sought is also not required to be heard. The Court held the that the High Court is justified in rejecting the application for impleadment of the appellant who was already charge-sheeted and against whom no relief was sought. The Court also stated that Rule 51 of Gujarat High Court Rules, which requires all all parties to any proceeding against which an appeal is sought shall be made parties in such appeal, shall not be applicable in the present case as an application under Section 178 (8) CrPC cannot be equated with an appeal or application against an order passed in a criminal case. [Key Words: Section 178(3) CrPC, Impleadment in an appeal] [Coram: Ashok Bhushan, J., M.R. Shah, J.]

In Jeetendra v. State of Madhya Pradesh the Court held that where closure report was filed twice, the High Court ought not to have declined bail only because the trial court was yet to accept the said report. Considering the nature of allegations (Sections 420, 177, 181, 193, 200 and 120B IPC) attributed to the appellant and the period already spent in custody by him the Court enlarged him on bail. [Key Words: Closure Report, Bail] [Coram: S.A. Bobde CJI, B.R. Gavai J., Surya Kant J.]

In Pawan Kumar Gupta v. State of NCT of Delhi, the petitioner challenged rejection of mercy petition by the President of India inter alia on various grounds that settled principles of consideration of mercy petition were not followed. The Court held that the plea of juvenility raised by the petitioner was duly considered and rejected by the Courts up to the Supreme Court. Applying the principles laid down in Epuru Sudhakar (2006) 8 SCC 161 and Satrughan Chauhan (2014) 3 SCC 1 the Court held that the exercise of power of judicial review of the decision taken by the President in mercy petition was very limited. The Court while dismissing the writ held that when the power was vested in the very high constitutional authority, it must be presumed that the said authority had acted carefully after considering all the aspects of the matter. It could not be said that the President did not consider the mercy petition with open mind filed by the petitioner. [Key words: Judicial review, Mercy Petition] [Coram: R. Banumathi J., Ashok Bhushan J., A.S. Bopanna J.]

Family Law

In M. Vanaja v. M. Sarla Devi (Dead), the Court upheld the judgment of the trial court and the High Court stating the conditions set out in Sections 7 and 11 of the Hindu Adoptions and Maintenance Act, 1956 (the “Act”) are mandatory and both the consent of the wife to the adoption and the ceremony of adoption need to be proved to treat an adoption as valid. The Court relied on its Judgment in Ghisalal v. Dhapubhai (Dead) by Lrs & Ors. (2011) 2 SCC 298 to state that the consent of the wide is mandatory for proving adoption. The Court distinguished its decision in L. Debi Prasad (Dead) By Lrs. v. Smt. Tribeni Devi & Ors. (1970) 1 SCC 677 by noting that the same dealt with adoption that took place in 1892, i.e. prior to the coming into force of the Act in 1956. [Key Words: proof of adoption, Sections 7 and 11 of the Hindu Adoptions and Maintenance Act 1956] [Coram: L. Nageshwara Rao, J., Deepak Gupta J.]

In Mangayakarasi vs. M. Yuvraj, the Court set aside the judgment by the High Court in second appeal under Section 100 CPC, by which it had dissolved the marriage between the parties under Section 13 of the Hindu Marriage Act (“HM Act”) and dismissed the Appellant’s petition for restitution of conjugal rights under Section 9 of HM Act. The Respondent had filed the petition seeking dissolution of marriage alleging that the Appellant was quarrelsome and had insulted him at his place of work, causing him to suffer mental cruelty. The trial court after appreciation of evidence concluded that the Respondent had failed to prove the allegations and also allowed the Appellants plea for restoration for restoration of conjugal rights. The Appellant in the meanwhile had initiated criminal proceedings against the Respondent alleging harassment on account of dowry and the Respondent, after facing trial came to be acquitted. The District Court affirmed the decision of the trial court in the first appeal. The Court noting the limited scope for reappreciation of evidence in second appeal under section 100 CPC stated that the High Court had erred in framing a question as to whether mental cruelty was made out by false prosecution by the Appellant since the Respondent had been acquitted in the criminal case for dowry harassment. The Court noted that the question rather than dealing with any substantial question of law, provided scope for reappreciation of evidence. Furthermore, the Respondent’s allegations regarding mental cruelty in the trial court were entirely different and the evidence was examined with regard to the same. The Court also stated that treating acquittal of one of the parties in a criminal proceeding initiated by the other as a ground for automatic ground for dissolution of marriage would be against the statutory provision. [Key Words: Section 13 Hindu Marriage Act, Section 100 CPC, Effect of criminal proceedings in dissolution of marriage] [Coram: R. Banumathi J., S. Abdul Nazeer J., A.S. Bopanna J.]

Service Law and Administrative Law

In Council of Architecture v. Mr. Mukesh Goyal, the question before the Court was whether Section 37 of the Architects Act 1972 permitted individuals not registered with the Council of Architecture to practice as architects. The Bench held that unlike in the case of doctors and advocates, a less stringent measure was adopted by the legislature for architects inasmuch as unregistered individuals were only prohibited from using the “title and style” of architect because of a pragmatic reason being that architecture included a wide array of activities. If “the legislature were to impose an absolute prohibition against unregistered individuals from ‘practicing architecture‘ there would be considerable confusion as to what activities formed the practice of architecture and what did not” and this would be resulted in a number of legitimate processionals “being barred from engaging in the design, supervision and construction of buildings merely because they were not registered under the Architects Act.”

The Recruitment and Promotion Policy 2005 was struck down in this as, being a delegated legislation, it was in conflict with the Central statute being the Architects Act inasmuch as it allowed unregistered individual to hold the title of “architect”.

[Key words: Uttar Pradesh Industrial Area Development Act 1976, Service Regulations 1981, NOIDA, Sections 2, 3, 14, 15, 17, 23, 29, 35, 37 of the Architects Act 1972, Section 15 of the Indian Medical Council Act, Section 29 of the Advocates Act] [Coram: D.Y. Chandrachud, J., Ajay Rastogi, J.]

In N. C. Santosh v. State of Karnataka & Ors., the appointment of Appellants, being beneficiaries of compassionate appointment, was terminated for being de hors the amended Rule 5 of the Karnataka Civil Service (Appointment of Compassionate Grounds) Rules 1996 (“Rules”). The Appellants applications before the Karnataka Administrative Tribunal came to be dismissed and the subsequent writ petitions were also dismissed leading the present appeals. The amended Rule 5 stipulated an outer limit of one year from the date of death of a government employee for the dependant to make an application for compassionate appointment and the dependent was also to have attained majority as on the date of application, whereas the unamended provision permitted a minor dependant to make an application within one year of attaining majority. The Court noticed the conflicting views expressed the Court, while in SBI v. Raj Kumar (2010) 11 SCC 661 & MCB Gramin Bank v. Chakrawarti Singh (2014) 13 SCC 583 held that the scheme in force when the application for compassionate appointment will be applicable and in Canara Bank & Anr. V. Mahesh Kumar (2015) 7 SCC 412, it was held that the scheme prevalent on the death of the employee should be considered. The Court noted that conflicting views have been referred to a larger bench by a two-judge bench in State Bank of India & Ors. v. Sheo Shankar Tewari (2019) 5 SCC 600. The Court relied on State Himachal Pradesh & Anr. V. Shashi Kumar (2019) 3 SCC 653 to reiterate that compassionate appointment to a public post is an exception to the general rule. Dependants of deceased government employees must fulfil the norms laid down by the State’s policy. The Court held that in the absence of any vested right accruing on the death of a government employee, the dependant can only demand the consideration of her application and as such the norms prevailing on the date of such application ought to be applicable. The Court found the Appellants were ineligible on the date of consideration of their applications and dismissed the appeals. [Key Words: Compassionate Appointments, Karnataka Civil Service (Appointment of Compassionate Grounds) Rules, 1996] [Coram: R. Banumathi J., A.S. Bopanna J., Hrishikesh Roy J.]

In Tulsa Devi Nirola and Others v. Radha Nirola and Others, the Appellants being the first wife and children of the deceased, were aggrieved by the denial of succession certificate under Section 372 of the Indian Succession Acts 1925 and the consequent denial of family pension, which was granted to the Respondents being the second wife and family. The Court noted that Rule 38 of the Sikkim Services (Pension) Rules 1990 (“the Pension Rules”) provided for nomination by the government person conferring one or more persons the right receive death cum gratuity. The Court observed that since the deceased had nominated only the Respondent no.1, Rule 40 of the Pension Rules providing for equal share among widows of the deceased, being conditional would have not application. The Court relied on Vidhyadhari & Ors. vs. Sukhrana Bai & Ors. (2008) 2 SCC 238 to reiterate that nomination of one wife to the exclusion of the other was valid. The Court further noted that the Appellant No.1 having entered into a settlement with regard to the movable and immovable assets of the deceased during his lifetime, could not be permitted to renege out of it. [Key Words: Family Pension, Sikkim Services (Pension) Rules 1990] [Coram: Ashok Bhusan J., Navin Sinha J.]

In C. Jayachandran vs. State of Kerala, The appellant, in the first round of litigation, challenged the grant of moderation marks in the selection process for direct recruitment for 6 vacant posts of district judges and consequently his non-selection by a writ petition. The Appellant succeeded before the Division Bench of the High Court, which also directed that the selection list be recast and the Appellant came to be appointed as District Judge. Meanwhile, Respondent judicial officers had been promoted to the post of district judges on an ad-hoc basis, without prejudice to the claim of direct recruits. The Appellant submitted a representation to the High Court claiming notional seniority from the date of the original appointments pursuant to the selection process instead of his actual appointment. The Administrative Committee of the High Court relied on P.K. Haneefa v. State of Kerala 2012 (4) KLJ 673 (FB) to hold that the transfer promotes appointed in excess of the quota were entitled to seniority from the date the such candidates were adjusted against the available vacancies within their quota and consequently, Appellant was assigned seniority from the date of the original appointments pursuant to the selection process by office memorandum. Aggrieved, the transfer promotes impugned the same by writ petitions, which was dismissed. In appeal, the Division Bench allowed the writ petitions holding that the Administrative Committee has faulted in applying Haneefa and furthermore that the Administrative Committee was not empowered to decide seniority dispute under the minutes of judges meeting held on 12 June 1986 and that the Appellant had waived his right to notional seniority by sleeping on his rights. In the appeal to this Court, the Court relied on Section 6 (2) of the Kerala State Higher Judicial Services Special Rules 1961, Sanjay Dhar v. J& K. Public Service Commission & Anr (2000) 8 SCC 182 and Lakshman Rao Yadavalli & Anr. v. State of Andhra Pradesh & Ors. (2014) 13 SCC 393 to hold that the Appellant The appellant was wrongfully excluded from the process of appointment on account of an illegal and arbitrary grant of moderation of marks. Thus, the High Court was correct to have revised his seniority considering the date he ought to have been appointed. The Court allowed the appeal holding that the transfer-promotions being subject to the rights of the direct recruits, they cannot claim any legal or equitable right. [Key Words: notional seniority, date of appointment, Kerala State Higher Judicial Services Special Rules 1961] [Coram: U. U. Lalit J., Hemant Gupta J.]

In Assistant General Manager, State Bank of India & Ors. Vs Radhey Shyam Pandery, the Court examining the eligibility of employees who had opted for the VRS scheme (‘scheme’) in 2000 with 15 years of service, relied on O.P.Swarnakar & Ors (2003) 2 SCC 721 to hold that the scheme was contractual in nature. The Court also noted that the Bank having presented the VRS Scheme as suggested by the Indian Bankers Association and having received the approval of the Central Government to the scheme under Section 50 of the Banking Companies Act, 1970, could not have unilaterally modified the scheme without seeking approval of the Central Government. Thus, having invited applications on the scheme, the Bank could not wriggle out of its obligations on the pretext of having failed to amend its Pension Rules. [Key Words: Pension Rules, Voluntary Retirement Scheme, Banking Companies Act, 1970] [Coram: Arun Mishra J., M.R. Shar J., B.R. Gavai J.]

In Ramesh Singh vs The State of Uttar Pradesh & Anr, the appellant, A Basic Education Officer, assailed the judgment of the High Court quashing the order of dismissal against him to the the limited extent that the order directed the disciplinary authority to hold enquiry against the appellant afresh during the pendency of which, he shall remain suspended and receive subsistence allowance as per Rules. The appellant was accused of making appointments to 521 posts of Assistant Teachers in a span of 3 months in violation of the Uttar Pradesh Basic Education (Teachers) Service Rules 1981. The Court dismissed the appeal noting that the serious allegations of corruption and the appellants defence of pressure from higher authorities would require determination in a full-fledged enquiry and that the appellant would remain under suspension during the period. [Key Words: Uttar Pradesh Basic Education (Teachers) Service Rules 1981] [Coram: S. Abdul Nazeer J., Indu Malhotra J.]

In Rajasthan High Court v. Ved Priya, the Court while setting aside the impugned order and confirming the order of discharge of Respondent held that the discharge order was based upon overall assessment of the performance of Respondent during the probation period, which was not found satisfactory. Such an inference which could be a valid foundation to dispense with services of a probationer did not warrant holding of an enquiry in terms of Article 311 of the Constitution. It held that even otherwise, just because there existed on record some allegations of extraneous considerations that the High Court was not precluded from terminating the services of Respondent simplicitor while he was on probation. The Court held that if the genesis of the order of termination of service lied in a specific act of misconduct, regardless of overall satisfactory performance of duties during the probation period, the Court would be well within its reach to unmask the hidden cause and held that the simplicitor order of termination, in fact, intended to punish the probationer without establishing the charge(s) by way of an enquiry. However, when the employer did not pick up a specific instance and formed his opinion on the basis of overall performance during the period of probation, the theory of action being punitive in nature, will not be attracted. Onus would thus lie on the probationer to prove that the action taken against him was of punitive characteristics. [Key Words: Discharge from service; probation period] [Coram: S.A. Bobde CJI, B.R. Gavai J., Surya Kant J.]

In State of Uttar Pradesh v. Vijay Shankar Dubey, while setting aside the impugned judgment the Court held that the cut-off date, 01.04.2001 for amendment of pay scale of the post of Joint Director, Prosecution on the basis of the recommendation of the Committee of the Chief Secretary was a conscious decision and the amendment in the pay scale was made following the analogy in the CBI organisation of the Center. When a benefit for the first time was extended to a category of employees, the State could always fix a rational cut-off date and it was not obligatory for the State to extend the benefit of analogy of the CBI organisation of the Center with effect from 01.01.1996 which was the date of the recommendations of the Fifth Pay Commission. It held that the respondent being not covered by the Government order dated 02.02.2007 was rightly informed that he was not entitled for the benefit of amendment in the pay scale as he got retired on 31.01.1997. [Key Words: Fixation of cut-off date; Revised Pay Scale; Fifth Pay Commission] [Coram: Ashok Bhushan J., Mohan M. Shantanagoudar J.]

In Union of India & Ors. V. Lt. Cdr. Annie Nagaraja & Ors., the Supreme Court invoked Part III of the Constitution, the doctrine of legitimate expectation and followed its own judgment in Babita Puniya (2020) 3 SCALE 712 to strike out Police Letter dated 26.9.2008 and Implementation Guidelines dated 3.12.2008 insofar as they were discriminatory against female Short Service Commission officers seeking permanent commission. The Court, passing a slew of directions, directed the Navy to induct female SSC officers on permanent commission, and pointedly used the Latin maxim ex turpi causa non oritur actio while characterising Navy’s arguments and stance wherein it had sought to contend that Navy service was fundamentally different from the Army and Air Force.

For a more extensive Bar and Bench summary, please visit:

https://www.barandbench.com/news/litigation/there-cannot-be-gender-discrimination-in-granting-permanent-commission-to-women-in-navy-supreme-court

[Key words: Sections 9, 184, 185 of the Navy Act 1957, Regulation 122, 124, 126, 202, 203 of the 1963 Regulations, Permanent Commission, Short Service Commission, Babita Puniya (2020) 3 SCALE 712, Sections 30 and 31 of AFT Act 2007, Article 33 of the Constitution of India, legitimate expectation, Notifications dated 9.10.1991 and 6.11.1998, Policy letter dated 25.2.1999, Policy dated 26.9.2008] [Coram: D.Y. Chandrachud, J., Ajay Rastogi, J.]

In Bharat Petroleum Corporation Limited and Others v. Anil Padegaonkar, the Employer was aggrieved as the High Court judgment set aside the order of the punishment on the ground that the disciplinary authority did not issue the charge sheet, and the Employee was aggrieved as the Employer was granted the liberty of issuing a fresh charge sheet and the judgment denied back wages while granting reinstatement. The Bench held that the High Court erred in assuming that the Employee was dismissed when he was actually discharged. It noted that though the word ‘discharge’ did not find reference under the Rules, nonetheless in service jurisprudence, removal and/or discharge were synonymous leading to a termination or end of service but without the punitive consequences of dismissal entailing loss of past services, affecting future employment and debarring retiral benefits. Consequently, on facts, the competent authority which issued the charge sheet was competent to discharge the Employee. [Key words: discharge, dismissal, charge sheet, jurisdiction, disciplinary authority, competent authority] [Coram: Ashok Bhushan, J., Navin Sinha, J.]

In Union of India and others and M.V. Mohanan Nair, the Court dealt with a batch of appeals assailing the orders of various High Courts upholding the decisions of Central Administrative Tribunal (“CAT”) granting financial upgradation of grade pay in the next promotional hierarchy relying on Union of India and others v. Raj Pal and another CWP. No. 19387 of 2011. The Court noted that Raj Pal was decided on peculiar set of facts by CAT and the challenge to the decision was dismissed by the High Court. The SLP against the order of the High Court was dismissed by the Supreme Court, in limine, on the ground of delay and such an order of dismissal would not constitute a binding precedent as envisaged under Article 141 of the Constitution as held in Supreme Court Employees Welfare Association v. Union of India and others (1989) 4 SCC 187 and therefore Rajpal could not have been relied on as a precedent by the High Courts.

The Court noted that the Respondents had not challenged clauses of the Modified Assured Career Progression Scheme (“MACP”)including the clause providing for financial upgradation in the next Grade Pay. The words used in the Scheme are “placement in the immediate next higher Grade Pay in the hierarchy of the recommended revised pay bands”. The contention of the Respondents that the benefit of MACP Scheme is referable to the promotional post is de hors the MACP Scheme. The Court held that the Respondents could not cherry-pick beneficial features from the erstwhile ACP Scheme and take advantage of beneficial features in the MACP Scheme. The Court observed that the MACP Scheme was based on the opinion of an expert body-the Sixth Central Pay Commission which took into consideration of all issues including representations and inter-departmental disparities caused under the ACP Scheme. The Court relied on Union of India and another v. P.V. Hariharan and another (1997) 3 SCC 568 to state that fixing of pay is the function of the Government, which normally acts on the recommendations of the Pay Commission and on State of U.P. and Others v. U.P. Sales Tax Officers Grade II Association (2003) 6 SCC 250 to state that the decision of expert bodies like the Pay Commission is not ordinarily subject to judicial review. The Court also cited Haryana Civil Secretariat Personal Staff Association (2002) 6 SCC 72, to state that the Court should interfere only when the Court is satisfied that the decision of the Government is arbitrary. The Court allowed the appeal noting that the MACP Scheme itself was not under challenge, nor were grounds made out that granting financial upgradation in the next grade pay would be arbitrary or unjust, so as to warrant interference. [Key Words: financial upgradation to next pay grade, MACP, 6th Pay Commission] [Coram: R. Banumathi J., A.S. Bopanna J., Hrishisikesh Roy J.]

In Sadhna Chaudhary vs. State of U.P & Anr., the Appellant, a judicial officer was aggrieved by the High Court’s dismissal of her writ petition against her dismissal from service on the recommendation of the Full Court of the High Court. The three-judge bench of the Court, referred to the Judicial Officer’s Protection Act 1850 to note the principle that judges cannot be held responsible for the end result or the effect of their decisions. The Court also noted that one of the alleged erroneous orders passed by the Appellant had in fact been affirmed by the Apex Court, which had also enhanced the compensation further, while the challenge to the other order too had been turned down by the High Court. The Court also took into note that the charges framed against the Appellant neither mention any specific extraneous consideration being actually received by the Appellant nor any unbecoming conduct. The finding of the misbehaviour was based on the apparently shocking judgement itself giving rise to suspicion as to the integrity and honesty of the Appellant. The Court held that mere suspicion cannot constitute ‘misconduct’. Any ‘probability’ of misconduct needs to be supported with oral or documentary material, even if the standard of proof would not be on par with that of a criminal trial and hence allowed the appeal, restoring the Appellant’s appointment and consequential benefits. [Key Words: Judicial Officers Protection Act, 1850, enquiry against judicial officer, misconduct] [Coram: S A Bobde, CJI., B.R. Gavai J., Surya Kant J.]

In Subodh-Kumar & Ors. vs. Commissioner of Police & Ors., the Appellants challenged the employment notification on behalf of Delhi Police along with the notification amending Rule 7 and Rule 27A of the Delhi Police (Appointment & Recruitment) Rules 1980 before the Central Administrative Tribunal, which came to be rejected. The challenge to the Ld. Tribunal’s order too was dismissed by the High Court, and the same was challenged before the Supreme Court. The Court. The Court noted that the amendment under challenge envisages giving due opportunity to the in-service candidates for participating against 10% out of the 50% quota reserved for direct recruitment to compete in the same selection process on the same standards and while reducing the upper age-limit may reduce the number of in-service personnel competing in the open selection, that cannot be regarded as unconstitutional or arbitrary. Dismissing the appeal, the Court further observed that it is settled law that a candidate has a right to be considered under the existing rules, which implies the ‘rule in force’ on the date the consideration took place and not the rule in force when the vacancy arose and prescribing of any age limit for a given post, as also deciding the extent to which any relaxation can be given if an age limit is prescribed, are essentially the matters of policy to be decided by the Government. [Key Words: Rule 7 and Rule 27A of the Delhi Police [Key Words: Appointment & Recruitment) Rules, 1980, eligibility criteria] [Coram: D. Y. Chandrachud J., Ajay Rastogi J.]

Constitutional Law

In Bharat Coking Coal Ltd. v. AMR Dev Prabha, the Court while relying on Jagdish Mandal (2007) 14 SCC 517 held that in tender matters writs are impermissible when the allegation was solely with regard to violation of a contractual right or duty. It held that in addition to arbitrariness, illegality or discrimination under Article 14 or encroachment of freedom under Article 19(1)(g), public interest too needed to be demonstrated before remedy was sought. It further held that although the threshold for demonstration of public interest was not required to be high, but it was nevertheless essential to prevent bypassing of civil courts and use of constitutional avenues for enforcement of contractual obligations. [Key Words: Maintainability of writs; tender] [Coram: S.A. Bobde CJI, B.R. Gavai J., Surya Kant J.]

In Internet and Mobile Association of India vs. Reserve Bank of India, the Petitioners, including Virtual Currency (“VC”) traders, exchanges challenged under the Court’s writ jurisdiction, a statement and circular issued by RBI, in exercise of the powers conferred by Section 35A read with Section 36(1)(a) and Section 56 of the Banking Regulation Act 1949 and Section 45JA and 45L of the Reserve Bank of India Act, 1934 (“RBI Act, 1934”) and Section 10(2) read with Section 18 of the Payment and Settlement Systems Act 2007, directing the entities regulated by RBI (i) not to deal in virtual currencies nor to provide services for facilitating any person or entity in dealing with or settling virtual currencies and (ii) to exit the relationship with such persons or entities, if they were already providing such services to them. The Court sought to test the impugned circular and statements against the tests laid out in Md. Faruk v. State of Madhya Pradesh & Ors. (1969) 1 SCC 853.The Court first observed that despite the fact that the users and traders of virtual currencies are also prevented by the impugned Circular from accessing the banking services, the impugned Circular has not paralyzed many of the other ways in which crypto currencies can still find their way to or through the market, but persons running VC exchanges have suffered a deadly blow by the operation of the impugned circular. The Court distinguished the present case from previous cases of challenge under Article 19 (1) (g) by noting that the restricted/prohibited trade activity in previous cases did not potentially destabilize the existing system and where RBI has acted on a conspectus of various factors perceive the trend as the growth of a parallel economy the same cannot lightly nullified as offending Article 19 (1) (g).

The Court noted that such a measure must still pass the four-pronged test of proportionality as laid out by the majority in Modern Dental College and Research Centre v. State of Madhya Pradesh (2016) 7 SCC 353, i.e. (i) that the measure is designated for a proper purpose (ii) that the measures are rationally connected to the fulfillment of the purpose (iii) that there are no alternative less invasive measures and (iv) that there is a proper relation between the importance of achieving the aim and the importance of limiting the right. The Court noted that although RBI had not considered availability of alternative before issuing the impugned circular, RBI had subsequently given detailed responses after considering Petitioners representations and suggestions of alternate measures. The Court stated that it may not scan the responses in greater detail in exercise of the power of judicial review.

The Court noted that RBI has not found any instance of VC (including exchanges) activities adversely impacting entities under its governance in the over 5 years of their activities and RBI itself having consistently stated that there is no prohibition of VCs. The Court relied on State of Maharashtra v. Indian Hotel and Restaurants Association (2013) 8 SCC 519 to state that there must have been at least some empirical data about the degree of harm suffered by the regulated entities (after establishing that they were harmed). Noting that RBI has failed to show even a semblance of damage suffered by its regulated entities and when VCs themselves have not been banned either by RBI or by statute, the Court held that the impugned measure cannot be said to be proportionate and set it aside. [Key Words: Virtual Currencies, Bitcoin, Section 35A, Section 36(1)(a) and Section 56 of the Banking Regulation Act 1949 , Section 45JA and 45L of the Reserve Bank of India Act 1934 and Section 10(2) read with Section 18 of the Payment and Settlement Systems Act 2007, Ultra Vires, Application of Mind, Colourable exercise of power, malice in law, Test of Proportionality, Prohibition, Regulation, Article 19 (1)(g)] [Coram: Rohinton Fali Nariman J., Aniruddha Bose J., V. Ramasubramanian, J.]

In Dr.Shah Faesal and Ors. Vs. Union of India and Anr, the constitutional bench of the Court examined the limited preliminary issue of whether the matter ought to be referred to a larger bench in light of the purported conflict between Prem Nath Kaul AIR 1959 SC 749 and Sampat Prakash AIR 1970 SC 1118. The Court traced the rule of per incuriam by referring to Ex Parte Brisbane Tramways C. Ltd. (No.1) [1914] 18 C.L.R. 54 , the principles of which were reiterated in Pranay Sethi (2017) 16 SCC 680.and Punjab Land development and Reclamation Corpn. Ltd. (1990) 3 SCC 682. The Court noted that the context of each case ought to be considered. That firstly, Prem Nath dealt with the competence of an enactment in the interregnum period after the coming into force of the Constitution of India, but before formulation of the Constitution of State of Jammu and Kashmir. Secondly, the views expressed in Prem Nath regarding the finality of Constituent Assembly’s decision has to be read as limited to decisions taken by the State Government prior to the convening of the Constituent Assembly, in line with Article 370 (2). Thirdly, Prem Nath does not discuss the continuation or cessation of Article 370, whereas the contention was directly made in Sampat Kumar. The Court reiterated that the rule of per incuriam is only applicable to the ratio of the judgment. The Court held that no cause was made out to refer the matter to a larger bench. [Key Words: Rule of Per Incuriam, Conflict between Judgments of Coordinate Benches, Reference to Larger Bench] [Coram: N.V. Ramana, J. Sanjay Kishan Kaul, J., R.Subhash Reddy, J., B.R. Gavai, J., Surya Kant, J.]

In B.K. Pavitra v. Union of India while relying on the principle laid down in Gurdip Singh, (2000) 7 SCC 296 the Court held that courts might scrutinise applications to assess whether they, in substance, sought a relief that might not be granted in those applications. It held that where the court was of the opinion that the nature of the application differed from its nomenclature and there was a method prescribed in law for grant of the reliefs sought, it might held that the application before it was not maintainable. The Court observed that the judgment in B K Pavitra II, (2019) 16 SCC 129 concerned the constitutional validity of the Reservation Act 2018 and not actions taken thereunder or in pursuance of its implementation. It held that applications filed were in effect a substantive challenge to the actions of the state government which were taken subsequent to the judgment passed in B.K. Pavitra II and therefore were not maintainable. [Key Words: Maintainability of an application in a passed judgment] [Coram: U.U. Lalit J., D.Y. Chandrachud J.]

In Bendict Denis Kinny v. Tulip Brian Miranda, while upholding the impugned order of the High Court the Court held that Section 5B of the Mumbai Municipal Corporation Act 1888 did not oust the jurisdiction of High Court under Article 226 of the Constitution. It further held that the High Court in exercise of jurisdiction under Article 226 of the Constitution could pass an order interdicting the legal fiction as contemplated under second proviso to Section 5B, provided the legal fiction had not come into operation. It held that there was no fetter in the jurisdiction of the High Court in granting an interim order in a case where caste claim by respondents was illegally rejected before the expiry of period of six months and the High Court granted the interim order before the expiry of period of six months. In the present case, the deeming fiction of retrospective termination of the election could not come in operation due to the interim order passed by the High Court, hence deeming fiction under Section 5B second proviso never came into existence to retrospectively terminate the election of the respondent. The Court held that an interim order could always be passed by a High Court in exercise of writ jurisdiction to maintain the status quo so that at the time of final decision of the writ petition, the relief might not become infructuous. It held that the power of the High Court to grant an interim relief in appropriate case could not be held to be limited only for period of one year, which was period envisaged in Section 5B for submission of the Caste Validity Certificate. No such fetter on the power of the High Court could be read by virtue of provision of Section 5B. [Key Words: Jurisdiction under Art.226, interim order] [Coram: Ashok Bhushan J., Navin Sinha J.]

In Food Corporation of India v. Brihanmumbai Mahanagar Palika while setting aside the impugned judgment the Court held that for the applicability of clause (2) of Article 285, the property owned by the Central Government on which tax was sought to be proposed ought to had been subject to property tax before the commencement of the Constitution. Since, object of the Article 285(2) of the Constitution was to continue the levy of the such tax which local authority was enjoying prior to the commencement of the Constitution so as to maintain the status quo regarding the financial resources of Municipal Corporation to avoid the complete exemption from property of Central Government as provided under Article 285(1). The Court held that in the present case the constructions on which the property tax was sought to be imposed by Municipal Corporation came into existence only after 1964 of which the appellant was only an occupier and were not subject to property tax prior to the commencement of the Constitution, hence condition for applicability of Article 285(2) was not satisfied and, therefore the Municipal Corporation was not competent to impose property tax denying the exemption under Article 285(1).[Key Words: Property Tax; Applicability of Art.285(2)] [Coram: Ashok Bhushan J., M.R. Shah J.]

In Ram Chandra Prasad Singh v. Sharad Yadav, the Court found that by an application for additional evidence what was sought to be taken on record by the appellant in the pending writ petition before the High Court challenging the order of the Chairman of Rajya Sabha, whereby the respondent incurred disqualification for being member of House under paragraph 2(1)(a) of the Tenth Schedule of the Constitution, was a subsequent event in which a new political party was formed/launched. It found that the foundation of disqualification of respondent was already laid down in the application which was filed by the appellant before the Chairman of Rajya Sabha. The order passed by the Chairman was based on the aforesaid application as well as the material and evidence, which was brought on record before the Chairman. The Court held that the additional evidence was not the basis for seeking disqualification of the respondent and hence, the impugned order rightly dismissed the application for additional evidence. However, the Court observed that there could be an exception to the general rule that any event subsequent to the passing of the disqualification order could not be considered by the High Court under Article 226 to test the legality of the said order. [Key Words: Additional evidence; subsequent event; Anti Defection; Disqualification][Coram: Ashok Bhushan J., M.R. Shah J.]

In Indore Development Authority v. Manoharlal & Ors etc., the constitution bench of the Supreme Court unanimously held as follows vide an elaborate 319-page judgment:

  1. Under the provisions of Section 24(1)(a) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act 2013, in case the award is not made as on 1.1.2014 i.e. the date of commencement of Act of 2013, there is no lapse of proceedings. Compensation has to be determined under the provisions of Act of 2013.

  2. In case the award has been passed within the window period of five years excluding the period covered by an interim order of the court, then proceedings shall continue as provided under Section 24(1)(b) of the Act of 2013 under the Act of 1894 as if it has not been repealed.

  3. The word ‘or’ used in Section 24(2) between possession and compensation has to be read as ‘nor’ or as ‘and’. The deemed lapse of land acquisition proceedings under Section 24(2) of the Act of 2013 takes place where due to inaction of authorities for five years or more prior to commencement of the said Act, the possession of land has not been taken nor compensation has been paid. In other words, in case possession has been taken, compensation has not been paid then there is no lapse. Similarly, if compensation has been paid, possession has not been taken then there is no lapse.

  4. The expression 'paid' in the main part of Section 24(2) of the Act of 2013 does not include a deposit of compensation in court. The consequence of non-deposit is provided in proviso to Section 24(2) in case it has not been deposited with respect to majority of land holdings then all beneficiaries (landowners) as on the date of notification for land acquisition under Section 4 of the Act of 1894 shall be entitled to compensation in accordance with the provisions of the Act of 2013. In case the obligation under Section 31 of the Land Acquisition Act of 1894 has not been fulfilled, interest under Section 34 of the said Act can be granted. Non-deposit of compensation (in court) does not result in the lapse of land acquisition proceedings. In case of non-deposit with respect to the majority of holdings for five years or more, compensation under the Act of 2013 has to be paid to the "landowners" as on the date of notification for land acquisition under Section 4 of the Act of 1894.

  5. In case a person has been tendered the compensation as provided under Section 31(1) of the Act of 1894, it is not open to him to claim that acquisition has lapsed under Section 24(2) due to non-payment or non-deposit of compensation in court. The obligation to pay is complete by tendering the amount under Section 31(1). Land owners who had refused to accept compensation or who sought reference for higher compensation, cannot claim that the acquisition proceedings had lapsed under Section 24(2) of the Act of 2013.

  6. The proviso to Section 24(2) of the Act of 2013 is to be treated as partof Section 24(2) not part of Section 24(1)(b).

  7. The mode of taking possession under the Act of 1894 and as contemplated under Section 24(2) is by drawing of inquest report/ memorandum. Once award has been passedon taking possession under Section 16 of the Act of 1894, the land vests in State there is no divesting provided under Section 24(2) of the Act of 2013, as once possession has been taken there is no lapse under Section 24(2).

  8. The provisions of Section 24(2) providing for a deemed lapse of proceedings are applicable in case authorities have failed due to their inaction to take possession and pay compensation for five years or more before the Act of 2013 came into force, in a proceeding for land acquisition pending with concerned authority ason 1.1.2014. The period of subsistence of interim orders passed by court has to be excluded in the computation of five years.

  9. Section 24(2) of the Act of 2013 does not give rise to new cause of action to question the legality of concluded proceedings of land acquisition. Section 24 applies to a proceeding pending on the date of enforcement of the Act of 2013, i.e., 1.1.2014. It does not revive stale and time-barred claims and does not reopen concluded proceedings nor allow landowners to question the legality of mode of taking possession to reopen proceedings or mode of deposit of compensation in the treasury instead of court to invalidate acquisition.

For a more elaborate summary, please see:

https://www.barandbench.com/news/litigation/breaking-what-a-constitution-bench-of-the-supreme-court-held-on-section-24-of-the-land-acquisition-act

[Key words: “and”, “or”, “paid”, “deposited”, tender, retrospective applicability, interpretation of a proviso, vesting and divesting, lapsing, legislative intent, literal interpretation, purposive interpretation, harmonious interpretation, non-obstante, conjunctive or disjunctive, actus curiae neminem gravabit, nemo tenetur ad impossible, lex non cogit ad impossibilia, principle of restitution, bright line approach, Article 300A, casus omissus, punctuation mark, comma, colon, full stop, custodia legis, Section 6 of the General Clauses Act, Legal fiction, Interpretation of positive and negative conditions, interpretation of repeal and saving clauses, mandatory and directory, Article 283, animus possidendi, ex abundanti cautela, interim orders, commodum ex-injuria sua nemo habere debet, expressio unius est exclusio alterius, impotentia excusat legem, Common law principles, doctrine of laches, “or” is to be read as 'and' or as 'nor', commodum ex injuria sua nemo habere debet, unfair advantage of an interim order] [Coram: Arun Mishra, J., Indira Banerji, J., Vineet Saran, J., M.R. Shah, J., S. Ravindra Bhat, J.]

Education

In The Pharmacy Council of India vs. Dr. S.K. Toshniwal Educational Trusts Vidarbha Institute of Pharmacy and Ors. Etc., the three-judge bench deciding several writ petitions transferred from various high courts, dealt with the common issue of whether the Pharmacy Council of India (“PCI”) or whether All India Council for Technical Education (“AICTE”) shall govern the field of pharmacy education. The Court examined the provisions of the Pharmacy Act, 1948, noting particularly that Section 10 empowers PCI to frame regulations prescribing the minimum standard of education required as a pharmacist. Similarly, Section 13 empowers PCI to withdraw its approval accorded to “course of study” for failure to comply with prescribed norms. The Court also noted that PCI has framed a number of regulations for prescribing minimum standards of education including Education Regulations 1991, Pharma D Regulations 2008 etc. The Court noted that the Pharmacy Act exclusively covers all areas inclusive of approval of courses, laying down course content, eligibility conditions for students as well as teachers, evaluation standards of examination, grant of registration, entry of higher qualifications in the same discipline, etc. and can be said to be special legislation dealing with the subject of pharmacy. The Court considered the scheme of All India Council for Technical Education Act, 1987, to note that it was a general law with respect to technical education. The Court relying on UPSEB v. Hari Shanker Jain (1978) 4 SCC 16, LIC of India v. D.J. Bahadur (1981) 1 SCC 315 and Yakub Abdul Razak Memon v. State of Maharashtra (2013) 13 SCC 1 and the maxim “Generalia specialibus non derogant”, the Court held that when there is conflict, a later general law does not indirectly, or impliedly repeal the earlier special law on a subject and the such special law shall prevail over the later general law. The Court also noted that PCI was composed of experts in the field of pharmacy, whereas AICTE consisted of only one expert in the field of pharmacy, that too a representative of PCI. The Court expressed its approval of AICTE v. Shri Prince Shivaji Maratha Boarding House’s College of Architecture (2019) SCC Online SC 1445 wherein a similar of controversy with respect to the role of Council of Architecture was decided. The Court noted subsequent Shri Prince Shivaji, the Union of India too had proposed deletion of the word ‘Pharmacy’ from Section 2(g) of the AICTE Act. The Court also noted that it was disputes between two statutory regulators were unhealthy for the education sector and that PCI, being a body of experts, alone should hold the power to regulate the field of pharmacy. [Key Words: Generalia specialibus non derogant, Pharmacy Council of India, AICTE, special legislation] [ Coram: Arun Mishra J., Vineet Saran J., M.R. Shah J.]

Specific Performance, Contract, Code of Civil Procedure, Transfer of Property, and Partnership

In Jose Vs Johnson, the Court noted that although possession would the prime consideration in a suit for bare injunction, each case will have to examined on merits and the pleadings of the parties put forth before the trial court. Therefore, where a plaintiff has prayed for permanent prohibitory injunction from questioning the plaintiff’s right to the property and has further failed to raise objections under Order 14 Rule 5 CPC to the issues framed by the trial court pertaining to the identity and ownership of the property, the High Court erred in holding that the title of the property was not a relevant consideration. [Key Words: suit for bare injunction, relevance of possession] [Coram: Indira Banerjee, J., A.S.Bopanna, J.]

In Ashok Kumar Gupta & Anr. Vs. M/s Sitalaxmi Sahuwala Medical Trust and Others,[AH1] the Appellant/trustee filed a suit against the Respondents inter alia seeking the framing of scheme of administration for the trust (running a hospital), removal of other trustees and the appointment of suitable trustees including the Appellant along with an application seeking leave of the court under Section 92 of CPC. In the Civil Revision Petition against the leave granted by the trial court, the High Court allowing the petition, held that the suit was framed to vindicate the private rights of the appellants and as such leave ought not to have been granted under Section 92. The Court relied on Chairman Madappa vs. M.N. Mahanthadevaru and others (1966) 2 SCR 151 and Bishwant (1967) 2 SCR 618 to reiterate 3 conditions to be satisfied for invocation of Section 92, namely (i) the trust is created for public purposes of a charitable or religious nature. (ii) there was breach of trust or a direction of court is necessary in the administration of such a trust. (iii) the relief claimed is one or other of the relied enumerated therein. The Court relied extensively on Suguru Bibi vs. Hazi Kummu Mia (1969) 3 SCR 83 to state that although the suit prayed for removal of Respondent-trustees and the appointment of suitable trustees including the appellant, such prayer has to be viewed in the context that the appellant himself was a medical professional and had been associated with the trust since its inception. Such a prayer could not be said to for vindication of private rights and the suit had been filed in a representative capacity. The Court restored the leave granted by the trial court and set-aside the judgment of the High Court. [Key Words: Section 92 CPC, leave to sue, public trust, vindication of private rights] [Coram:U. U. Lalit, J., Vineet Saran, J.]

In Sajan Sethi vs Rajan Sethi, the Court dismissed the appeals against the judgement and decree in a partition suit and a review petition in the first appeal against the judgement, noting that the High Court was correct to observe that although the plaintiff had not pleaded for the partition of the common areas on ground floor of the subject property, the trial court had framed the issue regarding the same based on the dispute raised by the Appellant-Defendant in his Written Statement. Having invited findings on common areas, it was not open for the Appellant-Defendant to plead that the trial court had exceeded the scope of the suit. [Key Words: Framing of Issues, Scope of Plaint] [Coram: M.M. Shantanagoudar J., R. Subash Reddy J.]

In State of Goa v. Narayan v. Gaonkar & Ors, the Appellant challenged the dismissal of the First Appeal against the judgment of the trial court dismissing the Appellant’s counterclaim in the special suit filed by the Respondents. The Respondents filed the special suit seeking deletion of Forest Department as a co-occupant from the revenue records and for declaration of title over the suit property. The trial court dismissed the Respondents claim of title and also the Appellants prayer in counterclaim for deletion of the Respondents’ names as co-occupants of suit property. The Court after examining the additional documents filed by the State observed that a public notice was issued under the Goa, Daman, Diu (Record of Rights and Register of Cultivators) Rules 1969, under which the suit property was recorded in the name of Forest Department only. Vishnu Gaonkar, ancestor of the Respondents had filed objection to the same, however had withdrawn his objection as recorded in record of proceedings. Despite the withdrawal, the names of ancestors of the Respondents was added to the revenue record in red ink. The Court held that such addition was illegal and without jurisdiction and therefore, allowed the appeal. The Court also observed that the Respondents had failed to disclose these relevant facts in the suit. The Court also took note of Fabricia da Igreja de N.s. de Milagres vs. Union of India and others (1995) 1 Bom Cr 588, while stating that a matriz document, which was sought to be relied on by the Respondents is not a document of title. [Key Words: The Goa, Daman, Diu (Record of Rights and Register of Cultivators) Rules 1969, Alteration of revenue records] [Coram: Ashok Bhusan J., Navin Sinha J.]

In Union Bank of India vs Rajat Infrastructure Pvt. Ltd. & Ors., where the Appellant assailed the order of the High Court relegating the matter back to the Debt Recovery Appellate Tribunal, permitting the Guarantor-Respondent to avail the statutory remedy without depositing 50% of the debt amount as determined by the Debt Recovery Tribunal as mandated under Section 18 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act 2002. The Court set aside the order of the High Court after relying on Narayan Chandra Ghosh vs UCO Bank (2011) 4 SCC 548 to reiterate that there was an absolute bar on entertaining an appeal under Section 18, unless the stipulated preconditions are met. The Court reiterated that a guarantor stands on the same footing as the borrower and has to comply with the terms of Section 18. [Key Words: Section 18, SARFAESI Act 2002, Guarantor] [Coram: Deepak Gupta J., Aniruddha Bose J.]

In Aviation Travels Pvt. Ltd. vs Bhavesha Suresh Goradia and others, the Appellant challenged the orders of the High Court declining to set aside the ex-parte judgment and decree dated 07.10.2003 against the appellants in a suit for damages and also the order of dismissal of the Appellant’s review petition. The Appellants contended that summons in the original suit were never served upon the Appellant at its registered address or any of its place of business. The Court noting the High Court’s observations regarding the filing of a Vakalatnama on behalf of the Appellant and also a power of attorney, which are being disputed by the Appellant, stated that there was no reason to believe that the Appellant would have benefited from deliberately not contesting the suit. The Court, after considering the nature of the claim, and also the bona fides of the Appellant in depositing part of the decretal amount, opined that the Appellant should be afforded an opportunity to contest the suit, in the interest of justice. The Court set aside the impugned orders and also restored the original suit. [Key Words: ex-parte decree] [Coram: R.Banumathi J., A.S. Bopanna J.]

In West Bengal Small Industries Development Corp. Ltd. v. M/s Sona Promoters Pvt. Ltd., while holding that the appellant-Corporation was a government undertaking within the meaning of Section 2(b) of the West Bengal Government Premises (Tenancy Regulation) Act 1976 as it was under the administrative control of the State Government, almost all the shares of the Corporation were held by the State and it owed its status as a body corporate to the Companies Act, the Court held that the premises in question did not satisfy the requirements of definition of “Government premises” within the meaning of Section 2(a) read with Section 2(c) of the Act since the bare land was let out by the Corporation and it continued to be a bare land as on the date of initiation of eviction proceedings and therefore, the incidence of such tenancy could not be governed by the provisions of the Act and such a tenant could not be evicted by taking aid of the provisions of the Act.[Key Words: Government Premises; Eviction] [Coram: Abdul Nazeer J., Deepak Gupta J.]

In Nand Ram (D) v. Jagdish Prasad (D) the Court while setting aside the impugned judgment held that the finding returned in the award of the Reference Court that the lease stood determined on account of non-payment of rent was a finding made by the Reference Court for a limited purpose i.e. not to accept the defendant’s claim for compensation. Such finding could not be binding on the parties in a suit for possession based on title neither it could operate as res judicata on this subsequent suit. It further held that even if the lessee had not paid rent, the status of the lessee would not change during the continuation of the period of lease under the agreement. The lessor had a right to seek possession in terms of clause of the lease deed. The mere fact that the lessor had not chosen to exercise that right would not foreclose the rights of the lessor as owner of the property leased. The Court held that after the expiry of lease period, and in the absence of payment of rent by the lessee, the status of the lessee would be that of tenant at sufferance and not a tenant holding over. [Key Words: Tenancy, land acquisition, determination of lease, res judicata, apportionment of compensation, tenant at sufferance] [Coram: L. Nageshwar Rao J, Hemant Gupta J.]

In Aarifaben Yunusbhai Patel & Ors v. Mukul Thakorebhai Amin & Ors, the Court allowed the a delay in filing objections under Order 21 Rule 90 could not be condoned under Section 5 of the Limitation Act 1963 and the only recourse was under Section 14 of the 1963 Act. However, the benefit under Section 14 was available to a person if it can prove that it is claiming exclusion of time of that period for which it had been prosecuting another remedy with due diligence and in good faith. In the present, it was held that the Respondent could not have been said to have filed the writ in good faith or due diligence as it prosecuted its writ petition despite making statements before the Executing Court as well as Supreme Court that it intended to file objections to the execution petition. [Key words: Order 21 Rule 90 CPC, Sections 5 and 14 of Limitation Act 1963, Article 127 of Third Division, Part1 of the Limitation Act 1963, bona fide, good faith, due diligence] [Coram: L. Nageswara Rao, J., Deepak Gupta, J.]

Practice and Procedure

In Dhanpat v. Sheo Ram (Deceased) the Court while setting aside the impugned judgment held that there was no requirement that an application was required to be filed in terms of Section 65(c) of the Evidence Act before the secondary evidence was led. A party to the lis might choose to file an application which was required to be considered by the trial court but if any party to the suit had laid foundation of leading of secondary evidence, either in the plaint or in evidence, the secondary evidence could not be ousted for consideration only because an application for permission to lead secondary evidence was not filed.[Key Words: Secondary evidence] [Coram: L. Nageshwar Rao J., Hemant Gupta J.]

Company Law

In Suborno Bose vs. Enforcement Directorate & Anr., the Appellant-Managing Director and the Company were each imposed a penalty of Rs. 10,00,000/- by the Adjudicating Authority upon a finding of violation of Section 10 (6) read with Section 46 and 47 of the Foreign Exchange Management Act,1999. The penalty was confirmed by the Appellate Authority and the High Court. The Supreme Court had dismissed the SLP filed by the Company while issuing notice in the Appellant-Managing Director’s SLP. The Court stated that a contravention of Section 10 (6) of the Act is a continuing offence and the penalty provided is on the account of the civil obligation. The Court noticed with approval, the High Court’s reliance on Chairman, SEBI vs. Shriram Mutual Fund & Anr. (2006) 5 SCC 361 to state that although the Appellant took over the management of the Company after the default committed by the Company, he failed to take corrective steps in earnest and was therefore liable for the contravention of the Act. [Key Words: Section 10 (6) read with Section 46 and 47 of the Foreign Exchange Management Act 1999, Penalty, Civil Obligation, personal liability of Director] [Coram: A.M. Khanwilkar J., Dinesh Maheshwari J.]

Taxation

In Rajasthan State Electricity Board v. Dy. Commissioner of Income Tax (Assessment), the Court found that even after disallowing 25% of the depreciation, the assessee in the return remained in loss and the 100% depreciation was claimed by the assessee in the return due to a bona fide mistake. It was further found that under Taxation Laws (Amendment) Act 1991, the depreciation in the case of Company was restricted to 75% which due to oversight was missed by the assessee while filing the return. The Court while relying on the judgment of Sati Oil Udyog Limited, (2015) 7 SCC 304 set aside the impugned judgment to held that the burden of proving that the assessee had attempted to evade tax was on the Revenue which might be discharged by the Revenue by establishing facts and circumstances from which a reasonable inference could be drawn but in the present case there was nothing to show that the claim of 100% depreciation by the assessee, 25% of which was disallowed, was with intend to evade tax and, therefore the provisions of Section 143 (1-A) was not applicable. [Key Words: Additional Tax, Depreciation, Evasion of Tax] [Coram: Ashok Bhushan J., Mohan M. Shantanagoudar J.]

In Commissioner of Income Tax, Udaipur v. M/s. Chetak Enterprises Pvt. Ltd., the Bench held that for the purpose of complying with Clause (a) of Section 80IA(4)(i) of the Income Tax Act 1961, the assesee “must be an enterprise carrying on business of (i) developing, (ii) maintaining and operating or (iii) developing, maintaining and operating any infrastructure facility, which enterprise is owned by a company registered in India.” The Bench held that insofar as Clause (b) of Section 80IA(4)(i), the requirement was that “the assessee must have entered into an agreement with the Central Government or a State Government or a local authority or any other statutory body for (i) developing, (ii) maintaining and operating or (iii) developing, maintaining and operating a new infrastructure facility.” [Key words: Part IX and Section 575 of the Companies Act 1956] [Coram: A.M. Khanwilkar, J., Dinesh Maheshwari, J.]

In M/s Super Malls Private Limited v. Principal Commissioner of Income Tax 8, New Delhi, the Bench held that in case where the Assessing Officer of the searched person and the other person were the same, it was sufficient for the Assessing Officer to note in the Satisfaction Note that the documents sized from the searched person belonged to the other person, thus fulfilling the requirement under Section 153C of the Income Tax Act 1961. Further, it was held that in case where the Assessing Officer of the searched person was the same, there could only be one satisfaction note, though the Officer must be “conscious and satisfied that the documents seized/recovered from the searched person belonged to the other person” and that the note would be “qua the other person”. The second requirement of transmitting the seized documents from the searched person to the other person would not logically arise and the same was for administrative convenience anyhow. [Key words: Section 153C of the Income Tax Act 1961, search and seizure, satisfaction note] [Coram: Ashok Bhushan, J., M.R. Shah, J.]

In Commissioner of Central Excise, Nagpur v. M/s Universal Ferro & Allied Chemicals Ltd. & Anr, it was held that the terms “sale” and “purchase” would draw their meaning from Section 2(h) of the Central Excise Act 1944 and not the Sale of Goods Act for the purpose of seeing if the transactions fall under EXIM Policy 1997-2002 as it was a “settled principle in excise classification that the definition of one statute having a different object, purpose and scheme cannot be applied mechanically to another statute.” It was held that on a reading of paragraph 9.9(b) of the EXIM Policy, Board circulars and other documents, the Assessee was entitled to carry out job work on behalf of TISCO on payment of duty under Exemption Notification 1997. The Bench relied upon Section 5A of the 1944 Act while disagreeing with the Revenue’s argument that Section (1) of the 1944 Act stipulated that an Export Oriented Unit is liable to duty on the goods brought to a Domestic Tariff Area, as if the goods were produced and manufactured outside India and were imported into India as per the provisions of the Customs Act 1962. Further, the Bench found no repugnancy between the amended Section 5A(1)(ii) and the Exemption Notification.

[Key words: plain and literal interpretation, export oriented unit, doctrine of repugnancy, raw materials, customs, excuse, exemption, “allowed to be sold in India”, “brought to any other place in India”] [Coram: S.A. Bobde, CJI., B.R. Gavai, J., Surya Kant, J.]

Labour Law

In The Joint Labour Commissioner and Registering Officer and Anr v. Kesar Lal, the question before the Court was whether “a construction worker who is registered under the Building and Other Construction Workers’ (Regulation of Employment and Conditions of Service) Act, 1996 and is a beneficiary of the Scheme made under the Rules framed pursuant to the enactment, is a ‘consumer’ within the meaning of Section 2(d) of the Consumer Protection Act 1986”?

On a reading of various provisions of the BOCW Act 1996 and adopting purposive interpretation, the Bench held that the true test for determining whether one was a consumer or not was not to examine whether the amount which has been contributed by the beneficiary was adequate to defray the entire cost of the expenditure envisaged under the scheme but to investigate whether the service which has been rendered is not rendered free of charge. The Bench held that any deficiency of service is amenable to the fora for redressal constituted under the Consumer Protection Act 1986 and the 1986 Act did not require an enquiry into whether the cost of providing the service is entirely defrayed from the price which is paid for availing of the service. This was because the definition of consumer not only included a person who had hired or availed of service but even a beneficiary of a service. [Key words: sovereign function, quid pro quo, beneficiary, consumer, labour law, contractual workers] [Coram: D.Y. Chandrachud, J., Ajay Rastogi, J.]

In Poonam Devi and others v. Oriental Insurance Co. Ltd., where the appellant, a dependant of the deceased workman, had sought compensation under the Workmen’s Compensation Act, 1923 (now Employee’s Compensation Act, 1923) after the workman drowned in a canal while drawing water in the course of his journey driving the employer’s truck. The Court set aside the judgment of the High Court and restored the order of the Workmen’s Compensation Commissioner granting the compensation, relying on the principle of notional extension as set out in BEST Undertaking vs. Agnes AIR 1964 SC 193 and Daya Kishan Joshi & Anr. vs. Dynemech Systems Pvt. Ltd. (2018) 11 SCC 642. The Court noted the Employee’s Compensation Act being a beneficial legislation, will have to be interpreted to advance the purpose of the legislation. The Court took note that workman who was driving the employer’s truck from Ambala to Meerut during the monsoon heat in June in an non-air-conditioned cabin would be under compulsion to stay fresh and alert to carry out his work as a driver safely. Thus, his act of fetching water from the canal and to refresh himself by a bath, was incidental to his employment under the notional employment theory. [Key Words: Employee’s Compensation Act, 1923, notional extension of employment] [Coram: Ashok Bhushan J., Navin Sinha J.]

Wills

In M.S. Bhavani and Anr v. M.S. Raghu Nandan, the Court held that the intention of the testator had to be primarily gathered from its language, reading the entire document as a whole, “without indulging in any conjecture or speculation as to what the testator would have done had he been better informed or better advised.” The Courts might look into the nature and grammatical circumstances such as the relationships prevailing in the family. The Court reiterated that there was no need to invoke the “last intention rule” where there was no contradictory statements in the will. In the present case, the Court distinguished the portion of the will which used the terms “shall” from “It is my desire that…” to hold that the deceased testator did not fetter his wife’s rights in disposing off the suit property.

[Key words: interpretation of will] [Coram: Mohan M. Shantanagoudar, J., R. Subhash Reddy, J.]

Land Ceiling, Land Acquisition, Town Planning, Rent Control and Tenancy

In Sajan vs State of Maharashtra and others, the Court partly allowing the appeal against the judgment of the High Court inter-alia reducing the compensation for land acquired under the Land Acquisition Act, 1894 by giving 40% deduction towards development cost. The Court relied on Major General Kapil Mehra and Others vs. Union of India and Another (2015) 2 SCC 262 and Lal Chand vs. Union of India and Another (2009) 15 SCC 769, the Court noted that the deduction for development cost may vary from 20% to 75% depending upon the purpose of acquisition of the land. The Court observed that the purpose for acquisition in the present case was for the construction of a Dam and would not require much development as in the case of a housing colony and therefore a deduction of 20% for development cost would be reasonable. [Key Words: deduction towards development cost, Land Acquisition Act 1894] [Coram: R.Banumathi J., A.S. Bopanna J.]

In Patram vs. Gram Panchayat Katwar & Ors, the Appellant was aggrieved in the change in the ownership column in the revenue records where ‘Shamlat Patti Dhera & Khubi’ were replaced by the entry ‘Panchayat Deh’ in terms of the Punjab Village Common Lands (Regulation) Act, 1961 (as amended and applicable to Haryana). The Appellant lost his challenge before the Collector and eventually before the Commissioner. The Appellant filed a writ petition, which too came to rejected. The Court traced the meaning of the words Shamilat (land held in joint possession and undivided lands which are part and parcel of a village), Shamilat deh (lands held commonly by a village proprietary body) and the words Taraf’, ‘patti’, ‘panna’ and ‘thola’(historically land of a group of villagers based on clan, caste, sect, area, etc. Since constitutional abolition of caste system, it refers to land of different hamlets/clusters where villagers reside in groups irrespective of their caste.) The Court further noted that a patti can normally be created out of the shamilat land only when a group of people enjoy some portion of the land out of the bigger common shareholding that is a patti.

In interpreting subclause (v) of clause (5) of Section 2(g) which provided lands described as “shamilat taraf, pattis, pannas and thola and not used according to revenue records for the benefit of the village community or a part thereof or for common purposes” would not fall under Shamilat deh, the Court compared the same with clause (3) which provided that land described as ‘shamilat’, ‘tarafs’, ‘patties’ ‘pannas’ and ‘tholas’, are to be treated as ‘shamilat deh’ land only if they are used for the common purpose of the village. The Court concluded that the absence of the comma after shamilat in subclause (v) of clause (5) of Section 2(g) was an error than rather than a deliberate non-use of the comma. A land can be ‘shamilat deh’ only if it is ‘shamilat taraf’, ‘shamilat patti’ etc. The Court noting that land has always been in possession of the Appellant and his ancestors and never shown to be for the benefit of the village or a community therein, allowed the appeal and directed the appellant’s name be entered as owner in the revenue records. [Key Words: Punjab Village Common Lands (Regulation) Act1961, meaning of Shamilat, Patti, tarafs] [Coram: L. Nageshwara Rao J., Deepak Gupta J.]

In Madhya Pradesh Housing And Infrastructure Development Board And Another vs. Vijay Bodana and Others, the Appellant was aggrieved by the order of the High Court, under its writ jurisdiction, setting aside the orders of Commissioner and Deputy Director, Town and Country Planning permitting the modification of the approved layout plan, under the Madhya Pradesh Nagar Tatha Gram Nivesh Adhiniyam 1973 (“the Adhiniyam”). The Court relied on Chairman, Vikas Pradhikaran v. Pure Industrial Coke & Chemicals Ltd. (2007) 8 SCC 705 and Rajendra Shankar Shukla and Others v. State of Chhattisgarh and Others (2015) 10 SCC 400, to reiterate scheme, object and distinction between development plan, zonal plan and town plan. Noting that modification of the approved layout plan is complaint with the law and the procedure followed itself was not challenged, the Court held that the High Court had erred in relying upon the principle of promissory estoppel to hold that once a layout plan is approved, the same cannot be modified. The Court also observed that the Respondents had filed the writ petition after 7 years of the modification and should not have been entertained in view of delay and laches, during which time about 42 persons had purchased plots in the modified layout area and some were living in it. [Key Words: modification of layout plan, the Madhya Pradesh Nagar Tatha Gram Nivesh Adhiniyam 1973] [Coram: Sharad A. Bobde CJI., S. Abdul Nazeer J., Sanjiv Khanna J.]

In Additional Commissioner Revenue and Others v. Akhalaq Hussain and Another, the Appellants challenged the order of the High Court setting aside an order under Section 167 of the U.P. Zamindari Abolition and land Reforms Act 1950 (“UP ZA & LR Act”), declaring the exchange of land between the Respondents and Mangal Singh (a member of a Scheduled Tribe) to be void and vesting the land with the State Government. The Court examined the language of the UP ZA & LR Act, noting that while transfer of land by exchange maybe permitted between two members of Scheduled Caste under Section 157-A, the words “or otherwise” in Section 157-B prohibits the transfer in any manner whatsoever. The Court also noted that even if Section 161 were applicable, admittedly, the Respondents did not seek permission from the Assistant Collector as mandated. The Assistant Commissioner was bound to refuse permission since the difference in rental values of the land exchanged calculated as hereditary rates was over 10%. The Court also noted that while land stood mutated in favour of the Respondents, the exchanged land was not mutated in favour of Mangal Singh, The Court relied on Samatha v. State of A.P (1997) 8 SCC 191 to emphasis the role of agriculture and land ownership in economic empowerment and stated that the UP ZA & LR Act being a beneficial legislation, the provisions ought to interpreted so as to achieve the objective of the legislation. The Court held that the limitation prescribed under Appendix-III of the UP ZA & LR Act was not applicable in the present case since it relates to suits for ejectment of sirdars/asamis and not to void transfers, which are also void ab initio.The Court set aside the judgement of the High Court noting that the High Court had erred in holding that Section 167 and 157-B of the UP ZA & LR Act where a person of Scheduled Tribe was getting land in exchange for her land. [Key Words: U.P. Zamindari Abolition and land Reforms Act, 1950, transfer by exchange, Section 157-B, Section 167] [Coram: R. Banumathi J., S Abdul Nazeer J. A.S.Boppanna, J.]

In D.B.Basnett (D) Through LRs vs The Collector, East District, Gangtok, the Appellant filed a title suit in 2002 seeking possession of about 7 acres against the Government of Sikkim, whereas the Gov’t claimed to have acquired the land from the Appellant’s father under the Sikkim (Requisition and Acquisition) Act 1977 (‘Land Acquisition Act’) in 1980 and had paid a compensation of Rs. 62,645 although neither the notice under section 4 of the Land Acquisition Act nor the actual receipt of the payment was available while the Appellant had continuously paid land revenue on the subject land. The trial court saw fit to dismiss the suit both on the substantial merits and on the issue of limitation. The High Court dismissed the appeal, save on the issue of limitation noting that neither had the Government claimed adverse possession nor would it be tenable since the Government also continued to collect revenue on the land. The Supreme Court in appeal stated that a letter of consent by the Appellant’s father for the acquisition of the land would not obviate the State’s burden to prove the due process under Sections 3(1), 4 (2), 5(1) and 7 (2) of the Land Acquisition Act were followed. The Court relied on its recent judgement in Vidya Devi vs State of Himachal Pradesh in Civil Appeal No. 6061 of 2020 to state that the State had failed to establish that it had acquired the land in accordance with law. The Court also relied on LAO v. M Ramakrishna Reddy (2011) 11 SCC 648 to award damages for wrongful use and possession of land. [Key Words: Land acquisition, burden of proof, right to land] [Coram: Sanjay Kishan Kaul, J., K.M.Joseph, J.]

REGISTRATION ACT

In Gurcharan Singh v. Angrez Kaur, the Court while setting aside the impugned order held that the pleading in the suit and in the written statement clearly lead to the conclusion that suit was filed on the basis of pre-existing right in favour of appellants, which was basis of the suit. Pre-existing right of the appellants was admitted by the sole defendant and decree was passed therein. It held that the decree was passed only with regard to suit property. The decree was, thus, expressly covered by expression “any decree or order of a Court”. The Court held that when legislature had specifically excluded applicability of clause (b) and (C) with regard to any decree or order of a Court, applicability of Section 17(1)(b) of the Registration Act 1908 could not be imported in Section 17(2)(v) by any indirect method and therefore, the decree did not require registration and was fully covered by Section 17(2)(vi), which contained exclusion from registration as required in Section 17(1).[Key Words: Registration; decree] [Coram: Ashok Bhushan J., Navin Sinha J.]

In Food Corporation of India and Others v. M/s V.K. Traders and Others, the Corporation argued that the Respondent rill mill owners were nothing but the proxies for the rice mill owners who were earlier blacklisted by the FCI for adulteration. While the premises of the blacklisted mill owners were shown as having been transferred to the present Respondents, the FCI termed them as sham transactions undertaken by the original mill owners (backlisted) to escape the FCI’s monetary penalties. The Bench agreed with the Appellant/FCI and stated that no reliance could be placed upon the lease deeds allegedly executed between the defaulting rice millers and the Respondents, as they did not satisfy the statutory requirements of Section 17(1)(d) of the Registration Act 1908. Ergo, the lease deeds could not be accepted as evidence of valid transfer of possessory rights. It further noted that even in a case where a proprietorship/partnership firm has been in existence for long and took over a mill-in-default only on-word basis, no right to seek allocation of paddy can be claimed by it unless the liabilities arising out of the previous bilateral agreement are satisfied. [Key words: black listing, sham transactions, compulsory registration, lease deed] [Coram: S.A. Bobde, CJI., B.R. Gavai, J., Surya Kant, J.]

Environment Law

In Bengaluru Development Authority v. Mr Sudhakar Hegde & Ors, the Court was asked to examine the validity of the NGT’s order quashing the Environmental Clearance granted to the Authority for the development of an eight-lane Peripheral Ring Road connecting Tumkur Road to Hosur Road. The Court noted that while the adversarial system was naturally rights based, it was common to postulate a winning side and a losing side. However, in matters of environment and development, there could not be any trade-off between the two. It urged that the efforts of conservation should be less based on lawsuits and more on robust institutional frameworks.

The Court passed a slew of directions under Article 142 to expedite the infrastructure project while observing the following:

  1. There was a failure of due process commencing from issuance of the Terms of Reference and leading to the grant of the Environmental Clearance for the ERR Project.

  2. The Authority relied upon an expired ToR and proceeded on the basis of outdated primary data.

  3. The process leading to the grant of the EC was contradictory on the existence of the forest land to be diverted for the project and number of trees to be felled.

  4. The State Expert Appraisal Committee abdicated its role and function by relying solely on the responses submitted to it by the appellant and failing to comply with its obligations under the Office Memorandums issued by the MoEFCC from time to time. Thus, there was no application of mind.

[Key words: sustainable development, EIA Notification 2006, accreditation of EIA consultant, forest land, environmental clearance] [Coram: D.Y. Chandrachud, J., Hemant Gupta, J.]

LAW OF CONTEMPT

In Shyam Sahni v. Arjun Prakash, the Court held that since repeated undertakings were filed and the same were not complied with, the Single Judge directed the respondent to surrender his passport. The said order was passed to ensure the presence of the respondent and compliance of the order of the Court. It held that it could not be said that the Single Judge exceeded the jurisdiction or committed an error in ordering surrender of the passport. In order to ensure the presence of the parties in the contempt proceedings, the Court was empowered to pass appropriate orders including the surrender of passport. [Key Words: Contempt proceedings; appropriate orders; surrender of passport to ensure presence of parties] [Coram: R. Banumathi J., A.S. Bopanna J.]

RIGHT TO INFORMATION

In Chief Information Commissioner vs High Court of Gujarat and Anr, the Court examined the pertinent issue of right of a third party to apply for information pertaining to case records under the Right to Information Act, 2005, without resorting to the Rules framed by the Gujarat High Court under Article 225 of the Constitution. The Court noted that the Rule 151 of the Gujarat High Court Rules 1993, does not deny access to information to third parties but only requires them to state via application/affidavit the reasons for which such information is required, so as to satisfy the court that the information is sought for bona fide reasons and to effectuate public interest. The Court distinguished between information held in its judicial side and administrative side, to further observe that on the judicial side the information is held by the High Court as a trustee for litigants in order to adjudicate upon the matter and administer justice. The information held by the High Court on the judicial side constitutes personal information of the litigants like title cases and family courts, and Income Tax Return. The Court relied on Institute of Chartered Accountants of India v. Shaunak H. Satya and Others (2011) 8 SCC 781 and endorsed the Delhi High Court’s ruling in The Registrar Supreme Court of India v. R S Mishra (2017) 244 DLT 179 to state that when the High Court Rules provide for a mechanism to obtain information, then the provisions of RTI Act are not to be resorted to. The Court relied on R.S. Raghunath v, State of Karnataka (1992) 1 SCC 334 to state that a later general enactment cannot override a special enactment unless there is clear inconsistency between the two legislations and as such since the Gujarat High Court Rules do not prohibit the dissemination of information but only stipulate filing of an application/affidavit, there is no inconsistency with the RTI Act and hence Section 22 of the RTI Act will not over-ride the Gujarat High Court Rules.[Right to Information Act, 2005, Access to Judicial Records, Privacy of Litigants, Gujarat High Court Rules, 1993] [R. Banumathi J., A. S. Bopanna J., Hrishikesh Roy J.]

CONSUMER LAW

In New India Assurance Co. Ltd. vs. Hilli Mulitpurpose Cold Storage Pvt. Ltd., the constitution bench of the Court sought to resolve the conflict between Topline Shoes Limited vs. Corporation Bank (2002) 6 SCC 480 and J.J. Merchant & Ors. vs. Shrinath Chaturvedi (2002) 6 SCC 635 on whether Section 13 (2) (a) of the Consumer Protection Act 1986 was mandatory or directory in nature. The constitution bench noted that subsection 2(b)(ii) of Section 13 particularly provides for a consequence for failure to file a response by the respondent to a complaint, i.e. the Consumer Forum may decide the complaint ex-parte. The Court also notices that the legislature has inserted subsection 3A of Section 13 providing for a speedy disposal of cases within 3 months from the receipt of notice by the opposite party. The Court stated that the phrase “endeavour shall be made” makes the intention of the legislature evident that the time limit under the provision is directory and that the District Forum can decide the cases beyond the said period, after recording reasons for the same, whereas the language of sub-section (2)(a) of Section 13 does not provide for similar discretion to the District Forum. The Court noting that the intention of the legislature is further evident by sub-section (3) of Section 13 which states that proceedings complying with sub-section (1) & (2) of Section 13 shall no be invalid on the principles of natural justice. The Court also noticed that the time provided for filing of appeals under the Act under Section 15, Section 19 and complaint under Section 24A provide for discretion to entertain the appeals and complaint beyond the proscribed limitation, as opposed to Section 13 of the Act. The Court referred to its decisions in Lachmi Narain vs. Union of India (1976) 2 SCC 953 to state that the use of peremptory language in a negative form is per se indicative of the interest that the provision is to be mandatory. The Court also referred to Bhikraj Jaipurai vs. Union of India AIR 1962 SC 113, amongst other cases to state that hardship cannot be a ground to enlarge time where a specific time is provided for in the statute. The Court also referred to India House vs Kishan N. Lalwani (2003) 9 SCC 393, among other cases to state that a statutorily prescribed period of limitation cannot be relaxed by equitable considerations. The Court also distinguished Section 13 (2) from Order VIII Rule 1 of the CPC noting that non-filing of written statement under Order VIII Rule 1 of the Code is not followed by any consequence. The Court also held that the requirements of Sub-Section (2)(a) and (2)(b) of Section 13 that the copy of the complaint which is to given to the opposite party directing him to give his version of the case within a period of 30 days or such extended period, not exceeding 15 days read with Regulation 10 (5) of the Consumer Protection Regulation specifying that the along the notice copies of the complaint, memorandum of grounds of appeal, petitions as the case may be and other documents filed shall be served upon the opposite party(ies)/respondent(s) make it clear that the period of limitation for filing a response to a complaint shall commence only upon the receipt of the notice and a copy of the complaint. [Key Words: Section 13 (2) Consumer Protection Act 1986, limitation for filing a response to a complaint] [Coram: Arun Mishra J., Indira Banerjee J., Vineet Saran J., M.R. Shah J., S. Ravindra Bhat J.]

In Nirmal Kothari v. United India Insurance Co. Ltd., the Court relied on United India Insurance Co. Ltd vs. Lehru & Ors. (2003) 3 SCC 338 and Pepsu RTC vs. National Insurance Co. (2013) 10 SCC 217 to state that an owner of a vehicle has to satisfy that the driver of the vehicle is carrying a valid driving license and be satisfied of the driver’s competence to drive, but cannot be expected to verify the validity of the driving licence from the concerned authority. An insurance company taking up the defence under Section 149(2)(a) (ii) of the Motor Vehicles Act 1988, the license of the driver of the car was invalid or fake, shall bear the onus to prove that the insured did not take adequate care to verify the genuineness of the license or was guilty of wilful breach of conditions. [Key Words: Section 149(2)(a) (ii) Motor Vehicles Act, 1988, Valid Driving License, Liability of Insurer] [Coram: Navin Sinha J., Krishna Murari J.]

Abhinav Hansaraman, Vikramaditya, Subhro Prokas Mukherjee
, Samith, Sahil Tagotra
Abhinav Hansaraman, Vikramaditya, Subhro Prokas Mukherjee
, Samith, Sahil Tagotra