2018 SCC Vol. 6 July 28, 2018 Part 3

Arbitration and Conciliation Act, 1996 — Ss. 7, 8 and 11(6) — Arbitration clause — Interpretation of: The parties are bound by the clauses enumerated in the policy and the court does not transplant any equity to the same by rewriting a clause. Further, an arbitration clause is required to be strictly construed and if a clause stipulates that under certain circumstances there can be no arbitration, and the circumstances are demonstrably clear then the controversy pertaining to the appointment of arbitrator has to be put to rest. [Oriental Insurance Co. Ltd. v. Narbheram Power and Steel (P) Ltd.,  (2018) 6 SCC 534]

Civil Procedure Code, 1908 — Or. 6 R. 17 proviso (as amended by Act 22 of 2002) — Amendment of plaint after commencement of trial — Relevant Considerations: Appellants in this case filed present suit for setting aside ex parte decree passed against their predecessor-in-interest in Civil Suit No. 195 of 1968. Record of suit in which ex parte decree was passed was not traceable in record room. In such circumstances, there could possibly be some inability in obtaining correct particulars well in time on part of appellants. Further: (i) at the time when application for amendment was preferred, only two official witnesses were examined, and (ii) proposed amendment neither changing the nature of suit nor introducing any fresh groun. On these facts, held, the proposed amendment ought to have been allowed, more so when it could not have caused any prejudice to defendants. [Gurbakhsh Singh v. Buta Singh, (2018) 6 SCC 567]

Civil Procedure Code, 1908 — Or. 7 R. 11(d) — Application for rejection of plaint: The plaint is required to be read as a whole. The defence available to the defendants or the plea taken by them in the written statement or any application filed by them, cannot be the basis to decide the application under Order 7 Rule 11(d). Only the averments in the plaint are germane. [Chhotanben v. Kiritbhai Jalkrushnabhai Thakkar, (2018) 6 SCC 422]

Competition Act, 2002 — Ss. 5, 6, 43-A and 64(3) — Combination — Regn. 9(4) of Regulations framed under S. 64(3) — Compliance with — Nature of transaction: Substance of transactions to be seen in circumstances of the case. Structuring of transactions should not be to avoid mandatory provisions of the Act. Having regard to facts and circumstances, it was held, transaction in question not independent one but part of a single, composite combination, interconnected and interdependent with other transactions. Hence non-notification of the transaction which formed part of combination amounted to violation of S. 6 and would entail penalty under S. 43-A. [CCI v. Thomas Cook (India) Ltd., (2018) 6 SCC 549]

Constitution of India — Arts. 21, 14, 32 and 136 — Misuse of provisions of Scheduled Castes and Scheduled Tribes (Prevention of Atrocities) Act, 1989 in last three decades: Issue of safeguards against arrest and false implications under provisions of Scheduled Castes and Scheduled Tribes (Prevention of Atrocities) Act, 1989, laid down to operate prospectively. It was also directed that balance must be maintained between need to check crimes against SCs and STs and there is need to protect innocent persons from abuse of process. There must be preliminary inquiry prior to FIR. To avoid false implication of innocent under Atrocities Act, preliminary inquiry must be made by Deputy Superintendent of Police (DSP) concerned prior to registration of an FIR to find out whether it comes within Atrocities Act and not frivolous or motivated. It should be time bound inquiry not exceeding seven days. Even if case has been registered after preliminary inquiry, arrest is not mandatory. There must be written permission prior to arrest. Further, in such cases, no arrest without written permission from appointing authority (in case of public servants) and Senior Superintendent of Police of District (in case of non-public servants) should be made and such permission must record reasons. Magistrate must also apply mind to see if such reasons are justified prior to taking further action. These directions are prospective in nature. [Subhash Kashinath Mahajan v. State of Maharashtra, (2018) 6 SCC 454]

Constitution of India — Arts. 226 and 227: In writ petition against Decree in eviction proceedings under Rent Act for possession and mesne profits, there was delay in complying with High Court directions to tenant to deposit rent and mesne profits. Rejection of tenant’s applications for extension of time and condonation of delay in making said payments without consideration of relevant facts, not proper. [Nonihal Singh v. Maya Devi, (2018) 6 SCC 396]

Criminal Procedure Code, 1973 — S. 438 — Remand — Dismissal of: As the anticipatory bail application was dismissed by High Court, without assigning any reasons, matter remanded back to High Court for deciding bail application filed under S. 438 CrPC, afresh on merits. [Prem Giri v. State of Rajasthan, (2018) 6 SCC 571]

Criminal Trial — Circumstantial Evidence — Generally — To sustain conviction on basis of circumstantial evidence — Requirements of: All links in the chain of circumstances must be complete leading to only hypothesis for guilt of accused. If there are any missing link in the chain of circumstances and possibility of innocence cannot be ruled out, benefit of doubt must be given by acquittal. [Satpal v. State of Haryana, (2018) 6 SCC 610]

Customs Act, 1962 — S. 130-A (prior to its repeal by Act 49 of 2005): On the matter of necessity of calling for a statement from the Tribunal before deciding application seeking reference under S. 130-A, in view of the ruling rendered in Central Mfg. Tech. Institute, (2018) 13 SCC 812 and considering question of law involved, matter referred to larger Bench. [CCE v. Adani Exports Ltd., (2018) 6 SCC 514]

Customs Act, 1962 — S. 135 — Charge under — Bail — Grant of: In the light of period of custody suffered by the appellant-accused and the fact that the co-accused has also been granted bail, the appellant is directed to be released on bail. [Munawwar Ali v. Union of India, (2018) 6 SCC 583]

Education Law — Employment and Service Matters re Educational Institutions — Promotion — Criteria/Eligibility: Cl. 1.1.1, UGC (Minimum Qualifications for Appointment of Teachers and other Academic Staff in Universities and Colleges and other Measures for the Maintenance of Standards in Higher Education) Regulations, 2010 provided that for teachers in Faculty of Medicine, norms/regulations of Ministry of Health and Family Welfare, GoI would apply for promotion to post of Professor in Medical College affiliated to Aligarh Muslim University (Central University). Cl. 12(19), Ch. IV, Aligarh Muslim University Ordinances (Executive) for Promotion under the Career Advancement Scheme stipulated that teachers in Faculty of Medicine should possess qualifications as prescribed by MCI. MCI Regulations provided MD/MS as the minimum qualification for appointment to post of Professor in Medical College. Hence held, finding of High Court that since appellants and R-6 & R-7 did not possess PhD they were not entitled for appointment to post of Professor erroneous and set aside. Matter remitted to High Court for consideration afresh since other issues raised by R-1 were not adjudicated. [Shadab Ahmed Khan v. Mujahid Beg, (2018) 6 SCC 385]

Family Courts Act, 1984 — S. 9: Under S. 9, Family Court has a duty to make endeavour to assist and persuade parties in arriving at settlement. Unlike many other legislations, legislature cast a duty on Family Court in this regard. Jurisdiction is not just to decide dispute but on contrary Family Court also has to involve itself in process of conciliation/mediation between parties for assisting them not only to settle disputes but also secure speedy settlement of disputes. Such timely intervention of Family Court will not only resolve disputes and settle the parties peacefully but also prevent sporadic litigation between the parties. [Anu Bhandari v. Pradip Bhandari, (2018) 6 SCC 389]

Income Tax — Deductions — Deduction of lease equalisation charges from lease rental income — Permissibility of: In this case, Respondent filed return of income for Assessment Year 1999-2000 claiming an amount of Rs 1,65,12,077 as deduction for lease equalization charges while Revenue contended that the respondent could not be allowed to claim such deduction in the absence of an express provision regarding it in the IT Act. It was held that the method of accounting followed, as derived from the ICAI’s Guidance Note, was a valid method of capturing real income based on the substance of finance lease transaction. Further, the difference between capital recovery and interest or finance income was essential for accounting for such a transaction with reference to its substance and if the same was not carried out, the respondent would be assessed for income tax not merely on revenue receipts but also on non-revenue items which was completely contrary to the principles of the IT Act and to its scheme and spirit. Further, the bifurcation of the lease rental was not an artificial calculation and, therefore, lease equalisation was an essential step in the accounting process to ensure that real income from the transaction in the form of revenue receipts only is captured for the purposes of income tax. In this case, held, the respondent/assessee was entitled for bifurcation of lease rental as per the accounting standards prescribed by the ICAI and also there was no express bar in the IT Act regarding the application of such accounting standards. [CIT v. Virtual Soft Systems Ltd., (2018) 6 SCC 584]

Income Tax Act, 1961 — S. 5 r/w Sikkim State Income Tax Rules, 1948 — Income by way of prize money from Sikkim State Lottery, prior to 31-3-1989 i.e. the date from which IT Act became applicable in the State of Sikkim — Taxability of: Prior to 26-4-1975, Sikkim was not considered to be a part of India and IT Act was made applicable only by Notification made in 1989. Appellant assessee a resident of Jaipur, Rajasthan, having income from business and property, won Rs 20 lakhs from Sikkim State Lottery and received Rs 16,20,912, after deduction of agent’s/seller’s commission and Rs 1,79,088 being income tax under the Sikkim State Income Tax Rules. It was held that the income accruing and arising in foreign countries can be brought to tax provided the assessee is resident and ordinarily resident and further the income accrued or received in any territory which is considered to be a part of India is within the net of the IT Act. Thus, appellant, being a resident of Rajasthan, the said received income for AY 1986-87 was liable to be included in the hands of the assessee as resident of India. However, since the amount had been earned by the appellant assessee in the State of Sikkim and the amount of lottery prize was sent by the Government of Sikkim to Jaipur on the request made by the appellant, S. 5 of the IT Act would not be applicable. Therefore, income tax would be payable, under the Sikkim State Income Tax Rules and not under the IT Act. Further, in the absence of a specific provision by the legislature for including such an income, the assessee could not be subjected to double taxation. [Mahaveer Kumar Jain v. CIT, (2018) 6 SCC 527]

Income Tax Act, 1961 — S. 80-HHC: Matter regarding entitlement to deduction of export incentives under S. 80-HHC to supporting manufacturer who receives export incentives in the form of duty drawback (DDB), duty entitlement pass book (DEPB), etc., referred to larger Bench. [CIT v. Carpet India, (2018) 6 SCC 620]

Penal Code, 1860 — S. 302 r/w Ss. 149 & 506 and Ss. 147, 148, 458 r/w S. 149 — Circumstantial evidence: In this case, chain of events unequivocally pointing towards guilt of accused, thus, not established. It is the duty of court to separate chaff from husk and to dredge truth from pandemonium of statements. There are no compelling reasons and substantial grounds for High Court to interfere with order of acquittal passed by trial court. Hence, acquittal of accused, restored. [Bhaskarrao v. State of Maharashtra, (2018) 6 SCC 591]

Penal Code, 1860 — Ss. 302/201/149 — Murder trial: In this case of brutal murder of a person with a view to prohibit such person from deposing before court in a case against his assailant, dead body of deceased was cut into two pieces, and thrown at two different places, in order to destroy evidence. There was involvement of 7 accused (including 5 appellant-accused herein, 2 accused since dead). Evidence of 3 eyewitnesses (PWs 6, 11 and 14) was found consistent, cogent and reliable regarding prime appellant-accused K. However, evidence against remaining accused was not as reliable. Hence, conviction of K alone, confirmed. Remaining accused given benefit of doubt and acquitted. [Kameshwar Singh v. State of Bihar, (2018) 6 SCC 433]

Penal Code, 1860 — Ss. 307/34, 323/34, 324/34 and 504: Four accused (appellant-accused) attacked one person T with axe and caused injuries to him on his body. Injuries were abrasion, contusion, and one lacerated wound. Acquittal of all accused reversed by High Court, thereby convicting them under Ss. 307/34, 323/34, 324/34 and 504 and sentencing them accordingly. Interference by Supreme Court with the order of High Court, by modifying respective jail sentences of three accused to that already undergone, while enhancing fine amount awarded by High Court, and also, acquitting the fourth. Reasons for reduction in sentences being: (i) instant litigation is pending in various courts for the past 20 yrs; (ii) seven injuries noticed on body of injured T were not very serious in nature; (iii) T survived leaving no disability much less permanent on his body due to causing of injuries and lived for 20 yrs after the date of alleged incident and died recently; (iv) all appellants underwent almost 1 yr of jail sentence including remission out of total jail sentence awarded by High Court except A-2, who underwent around three months; (v) all appellants were first offender and were not found involved in any criminal activity in the last 20 yrs, though remained on bail throughout; and (vi) Appellants 2 and 3 are reported to be in government service. However, so far as involvement of Appellants 1, 3 and 4, in commission of offence is concerned, from findings of High Court qua each, no case for interference on such findings of fact is called for herein. Hence, finding of conviction of Appellants 1, 3, and 4, is confirmed. For all aforementioned reasons, interference only in quantum of jail sentence awarded by High Court is required and, therefore, their jail sentence is reduced to the sentence already undergone. However, it is just and proper to enhance fine amount imposed by High Court on Appellants 1, 3 and 4 from Rs 7000 to Rs 75,000 for each. [Naresh v. State of Uttarakhand, (2018) 6 SCC 404]

Procedure Code, 1908 — Ss. 152, 151, 33 & 2(2) and Or. 20 — Amendment of decree in order to make it executable: In partition suit, decree was passed by trial court holding plaintiff and defendants to be entitled to 3/5th share and 2/5th share respectively in suit property. There was no dispute as to share allotted in favour of parties concerned but, in order to make that decree executable, defendants moving an application before trial court for amendment of decree seeking direction that sketch map submitted by plaintiff on 6-2-2001 be marked as an exhibit and a part of judgment and decree by effecting necessary corrections in that regard. It was held that since partition decree could not be given effect to without a sketch map of suit schedule property, at the time of passing decree, trial court should have made the sketch map submitted by plaintiff on 6-2-2001 a part of decree. In absence thereof, no party should suffer for the error of court. Consequently, trial court rightly allowed amendment of decree by making the sketch map submitted by plaintiff a part of decree for effecting partition. High Court erred in setting aside that order. [Subhash Chandra Sen v. Nabin Sain, (2018) 6 SCC 443]

Scheduled Castes and Scheduled Tribes (Prevention of Atrocities) Act, 1989 — S. 18: Review sought of order dt.20-3-2018, Subhash Kashinath Mahajan, (2018) 6 SCC 454. It was clarified that order sought to be reviewed does not bar compensation or other immediate relief being given to victim member of SC/ST as per law. [Union of India v. State of Maharashtra, (2018) 6 SCC 450]

Service Law — Appointment — Judicial Review/Validity of appointment — Exclusion of Judicial Review — Policy/Policy decision/Policy matter — Interference with Equivalence/Marking Systems devised by Appointing Authority — Scope of: Eligibility prescribed for appointment to post of Social Education Organiser was Bachelor’s degree in Sociology from recognised university. K challenged appointment of appellant on ground that appellant did not possess requisite qualifications since she had degree in Malayalam and Sociology (Double Main). High Court by impugned judgment set aside appointment of appellant interfering with marking system. It was held that High Court erred in doing so since only grievance of K was regarding eligibility of appellant. Further held, in such matters it is always advisable to leave award of marks, weightage to be given, etc. to competent authorities. Any interference by court would amount to trenching on wisdom and expertise of selecting authority leading to avoidable litigation and uncertainty of employment unless there is some ex facie perversity or illegality in process. Moreover, University on considering equivalence issue had concluded that degree in Malayalam and Sociology (Double Main) was equivalent to degree in Sociology (Single Main). Appellant, thus, was eligible for appointment. [Thahira P. v. State (UT of Lakshadweep), (2018) 6 SCC 446]

Service Law — Recruitment Process — Irregularities/Malpractice/Illegalities: If selection is found to be tainted in any manner, it is always open to authority concerned to annul such selection to maintain purity of selection process since it is not necessary to segregate tainted and untainted candidates when process itself is tainted. Further held, at pre-appointment stage, decision to cancel selection process can be interfered only if it is patently arbitrary, mala fide or illegal. [Avinash C. v. State of Karnataka, (2018) 6 SCC 614]

Service Law — Recruitment Process — Irregularities/Malpractice/Illegalities: To maintain purity of selection to public posts directed that as far as possible selection process conducted by selection bodies especially State Public Service Commissions and State Selection Boards be videographed by installing CCTV cameras at examination as well as interview centres to extent viable, footage whereof may be seen by independent committee of three members and report of such committee placed on website concerned. [State of Meghalaya v. Phikirbha Khariah, (2018) 6 SCC 618]

Service Law — Recruitment Process — Test/Written examination — Evaluation of answer scripts — Re-verification: As the Committee appointed by High Court found irregularity, High Court directed re-verification of scripts of all 1068 candidates, which was affirmed and not interfered with. Submission that re-verification should be limited only to those filing writ petition, rejected. [Tongbram Bimolchand Singh v. Yumlembam Surjit Singh, (2018) 6 SCC 564]

Specific Relief Act, 1963 — Ss. 34, 35, 37 and 38: In a case where claim of ownership of property is subsequent to its acquisition, where acquisition proceedings attained finality, declaratory remedy of ownership cannot be granted. Suit of such nature cannot be filed. [Y.P. Sudhanva Reddy v. Karnataka Milk Federation, (2018) 6 SCC 574]

Tenancy and Land Laws — Ceiling on Land — Exemption from land ceiling: It is the duty of landowner to show which portion of land is exempted from land ceiling proceedings. [Vishwasrao Satwarao Naik v. State of Maharashtra, (2018) 6 SCC 580]

Transfer of Property Act, 1882 — Ss. 54, 55, 11 and 31 — Supersession of allotment letter by sale deed: Conditions imposed in allotment letter/contract for sale are not binding if not contained in agreement of sale/sale deed. [A.P. Industrial Infrastructure Corpn. Ltd. v. S.N. Raj Kumar, (2018) 6 SCC 410]

U.P. Sugar Undertakings (Acquisition) Act, 1971 (23 of 1971) — Ss. 3 and 2(h)(vi) — Land leased to an undertaking engaged in the manufacture or production of Sugar: The word “held” connotes a wide meaning and all lands held or occupied lawfully and used for the purposes of the factory stood vested in the Government on the appointed day. Further, the word “held” in S. 2(h)(vi) cannot be interpreted as limited only to a holding as an owner of the property and legal possession was sufficient for the lands to vest in the Government by forming part of the scheduled undertaking. Also, the word “including” in S. 2(h)(vi) indicated that the lands held by way of lease were also part of a scheduled undertaking. Further, rejecting the contention that vesting under the 1971 Act was only in respect of the leasehold rights, held, the words “including any leasehold interest therein” in S. 2(h)(vi) could not be understood to have a limiting effect and result in the acquisition of only the leasehold interest in the land. [Gaurav Aseem Avtej v. U.P. State Sugar Corpn. Ltd., (2018) 6 SCC 518]

Join the discussion

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.