Case BriefsHigh Courts

Patna High Court: A Full Bench of Hemant Kumar Srivastava, Aditya Kumar Trivedi and Ashutosh Kumar, JJ. refrained from adjudicating on the validity of Section 76(2) of the Bihar Prohibition and Excise Act, 2016.

In the present case, the question for consideration was whether the provisions of Section 438 Code of Criminal Procedure, 1973 continue to apply in spite of the bar created under Section 76(2) of the Bihar Prohibition and Excise Act, 2016 and as to whether such an application under Section 438 CrPC for anticipatory bail was maintainable. A Single Judge Bench had ruled that anticipatory bail applications cannot be entertained for offences under the purview of the Act. However, another Single Judge Bench in Manish Kumar v. State of Bihar,  Cr. Misc. No. 21578 of 2017, held that the previous judgment was per incuriam as Section 76(2) of the Act of 2016 ran repugnant to Section 438 CrPC and, therefore, violative of Article 254 of Constitution of India and referred the matter to Division Bench. The Division Bench was of the view that the matter was already under consideration in the Supreme Court and to decide on the matter would amount to judicial overreach. The case was then referred to this Full Bench due to the conflict in judgments given by the prior Benches.

The Court opined that a Single Judge Bench could not overrule the judgment given by another Single Judge Bench, and the Judge in Manish Kumar case was not right in declaring the judgment given by another Single Judge Bench per incuriam.

The Full Bench was unanimous in the opinion that till the matter was still under consideration in the Apex Court which would include the justification of a State Legislature in providing a complete bar to the grant of anticipatory bail to accused persons of offences under the Act, anticipatory bail petitions shall not be maintainable; unless from the facts of the case, it would prima facie appear that none of the ingredients of the offences under the Act of 2016 are made out for attracting the bar of Section 76 (2) of the Act. For coming to the aforesaid conclusion as to whether the offence can be said to be made out of the facts of the case, no detailed enquiry was to be made.

The Full Bench, hence, approved the view of the Division Bench in Manish Kumar case that it was not right to decide the matter till the matter was still pending in the Supreme Court and refrained from adjudicating into the matter.[Ram Vinay Yadav v. State of Bihar, Criminal Appeal (SJ) No. 431 of 2019, decided on 17-05-2019]

Case BriefsHigh Courts

Bombay High Court: S.C. Gupte, J. while setting aside an arbitral award for patent illegality, observed that “any forum, which adjudicates upon the rights and liabilities of the parties based on a contract, is enjoined upon to determine those rights and liabilities in accordance with the contractual terms, be it a court or an arbitral forum.”

The respondents were the borrowers of the Madhavpura Mercantile Coop. Bank Ltd. whose accounts were declared as non-performing assets (NPAs) for committing default in repayment of loans. To expedite the recoveries, the Bank formulated Compromise Scheme of Settlement (CSS-2013). As per the CSS, the NPA date in case of respondents was expressly stated to be 31-3-2001 and it was expressly stipulated that no conditional proposal for settlement or proposal disputing the NPA date would be accepted. The respondents accepted CSS unconditionally. Later, the respondents raised a dispute about the NPA date and therefore disputed their liability under the CSS. The matter went to arbitration and the Arbitral Tribunal accepted the respondents’ case on the applicable NPA date and made an award in their favour. Aggrieved thereby, the Bank filed the present petition.

The High Court was of the view that the arbitrator exceeded his jurisdiction by reformulating the contract between the parties contained in the CSS. It was noted that CSS-2013 was not a statutory scheme and nothing prevented the petitioner from naming any particular date as the NPA date, 31-3-2001 was treated as NPA date on the basis of statutory auditor’s report. It was made clear in CSS-2013 that the scheme could not be accepted conditionally. It was for the individual debtor to accept or reject the scheme. The respondents accepted it unconditionally which brought about a concluded contract substituting the original contract of loan between the parties. The Court said: “The arbitrator, who was to adjudicate the rights and liabilities of the parties, was expected to determine such rights and liabilities under such contract, namely, CSS2013. It was not open to him to question CSS-2013 or relieve any debtor from his obligations under it on some notion of equity or sympathy.” 

It was also observed: “The consensus between the parties to refer their dispute to arbitration merely implies that the parties are agreeable to have the dispute adjudicated by an arbitral forum as opposed to a court of law. The rights and liabilities, which are to be thereby determined, are the rights and liabilities arising under the contract. Such consensus does not in any way impinge upon these rights and liabilities.”

It was held that the impugned award, thus, deserved to be quashed, both on the grounds of patent illegality, since the declaration in it was in the face of a contract as well as for the reason of the arbitrator having taken an impossible view, or a view which no fair or judiciously mined person  would take. [Madhavpura Mercantile Coop Bank Ltd. v. Rasiklal D. Thakkar, Commercial Arbitration Petition No. 179 of 2016, decided on 25-03-2019]

Case BriefsHigh Courts

Punjab and Haryana High Court: This writ petition was filed before the Bench of G.S. Sandhawalia, J., against the award passed by the Arbitrator under the Railway (Amendment) Act, 2008, whereby the market value had been fixed for the land acquired for the Dedicated Freight Corridor Project.

The dispute was with regard to the Arbitrator’s action where he modified the initial award passed to enhance the compensation. Thus, landowners approached this Court for further enhancement of the compensation. Respondent contended that the arbitral award should have been challenged under Section 34 of the Arbitration and Conciliation Act, 1996 which is a statutory remedy available with petitioner.

High Court was of the view that the landowners who approached Court were similarly situated to landowners who had already approached the District Judge. The only feasible argument for the landowners was to point out the delay caused and difficulty in filing objections under Section 34 of the Act. Court opined that Section 14 of the Limitation Act should also be considered. Case of Narendra Singh v. State of U.P., 2017 (9) SCC 426 was referred to where with respect to Section 28-A of the Land Acquisition Act, 1894 Court had held that it was not an adversarial form of adjudication and fair compensation was to be determined for all landowners whose land was taken away by the same notification. Thus, landowner’s apprehension was without any basis; therefore, this petition was dismissed. [Satbir v. Union of India, 2019 SCC OnLine P&H 132, decided on 13-02-2019]

Case BriefsHigh Courts

Kerala High Court: The Bench of Dama Seshadri Naidu J. hearing a civil writ petition filed by a vehicle dealer granted an interim stay on the levy of Goods and Services Tax on the amount collected by vehicle dealers from purchasers.

Petitioner, a motor vehicle dealer, challenged the applicability of Section 15(2) of the GST Act, 2017 which mandates that the value of supply should include any taxes, duties, cesses, fees and charges levied under any other law in force. His contention was that the amount of 1% that the dealer of motor vehicle collects from the purchaser of a car worth more than ten lakhs (which is the tax collected at source), under Section 206C (1F) of the Income Tax Act, 1961 cannot be treated as an integral part of the value of the goods and services supplied by the petitioner. This is so because the dealer of the motor vehicle, acts only as an agent for the State to collect income tax under Section 206C(1F) of the IT Act and that amount eventually goes to the vehicle purchaser’s credit.

The Court concluded that the petitioner had raised a prima facie issue which needed Court’s attention and further and deeper adjudication. In view thereof, it directed the tax authorities to not act on the clarification at serial no. 5 of the notification issued by the Central Board of Indirect Taxes and Customs till the disposal of the instant petition.[PSN Automobiles (P) Ltd. v. Union of India, WP (C) No. 680 of 2019, order dated 17-01-2019]

Case BriefsForeign Courts

“When in the name of preservation of tradition these jirgas/panchayats assume the powers of a pillar of the State, i.e. the judiciary, they threaten the very foundations of the rule of law. What these bodies in effect preserve is the unfair social constructs in the rural areas where the word and arbitrary decisions of the elites, waderas, chaudhries, and persons of influence are treated as law and imposed upon the socially and financially weaker parties.”

Supreme Court of Pakistan: The Division Bench of Mian Saqib Nisar, HCJ and Ijaz Ul Ahsan, J. hearing a petition filed under Article 184(3) of the Constitution of the Islamic Republic of Pakistan, 1973 challenging the legality of operation of jirgas/ panchayats as adjudicatory bodies, held the same to be illegal.

‘Council of elders’ or ‘kangaroo courts’ exist in some tribal areas of Pakistan, particularly in north Khyber Pakhtunkhwa (KPK) and in some rural areas of KPK, Punjab, Sindh and Balochistan.

The Court noted perused the research report prepared by petitioner titled “Women, Violence and Jirgas – Consensus and Impunity in Pakistan” and opined that jirgas violate fundamental rights of citizens as they apply their own customary/tribal/feudal procedure in taking decisions. Customarily negligible representation of women before such councils violates Article 2 of the International Covenant on Civil and Political Rights (ICCPR).

Reliance was placed on Shazia v. Station House Officer, PCrLJ 2004 Karachi 1523 where it was held that operation of kangaroo court/council of elders violates principles of natural justice, due process and fair trial as it does not follow any procedure and operates as a parallel judicial system, thus usurping powers of Court.

The Court also noted the rulings of Supreme Court of India in Arumugam Servai v. State of Tamil Nadu, (2011) 6 SCC 405 and Shakti Vahini v. Union of India, (2018) 7 SCC 192 wherein khap panchayats were declared illegal; and preventative, remedial and punitive measures were introduced to eradicate any khap panchayat ordering honour killings. The Court observed that just like India, Pakistan must also take stringent and immediate action to eradicate the menace of jirgas/panchayats to the extent that they assume power to adjudicate criminal or civil disputes without following any law.

In view of the above, it was held and clarified that it is not the term ‘panchayat’ or ‘jirga’ which is illegal but the act of them posing as courts and usurping the powers of a court of law which is illegal. [National Commission on Status of Women v. Government of Pakistan, Constitution Petition No. 24 of 2012, dated 16-01-2019]

Case BriefsHigh Courts

Allahabad High Court: A Single Judge Bench comprising of Rajeev Misra, J., dealt with this petition which was filed under Article 227 of the Constitution of India where a summoning order under Sections 323, 504, 379, 427 and 452 IPC, criminal revision petition and any proceedings arising out of them were prayed to be quashed.

Petitioner had made contentions on factual basis pleading that he had been falsely implicated. Various cases were referred before the Court which elucidated in length the legal aspects evolved with regard to matters where proceedings can be quashed. Cases, where allegations made against accused or investigation was done by investigating officer, do not show any offence committed by accused or the allegations seems absurd, or extremely improbable, or where prosecution is legally barred, or the criminal proceeding is found to be made maliciously with motive of grudge can be quashed.

The Court observed that as per the submissions of petitioner, adjudication was required on the question of facts and even the question of law coming therein can be adjudicated by the trial court itself. Court found no reason to quash the summoning order, complaint or any other proceedings arising out of them. Therefore, the writ petition was dismissed. [Vivek Kumar v. State of U.P.,2018 SCC OnLine All 1166, order dated 23-08-2018]