by LFIAdmin | Dec 8, 2020 | Uncategorized
By Nazaqat Lal, Advocate & Solicitor, Bombay High Court
nazaqat_lal@hotmail.com | Dec 8, 2020
[*The relevant sections and statutes have been mentioned in brackets]
1. Who is a notary?
A notary is a person appointed by the Central Government or State Government to perform notarial acts as an impartial witness, verifying the identity of the person signing and that such person signed in the presence of the notary.
2. What are the functions of a notary?
Functions of a notary include certifying the execution of a document, administering oath to or taking affidavit from any person, translating and verifying the translation of a document from one language to another, acting as a Commissioner to record evidence in any civil or criminal trial if so directed, etc.
[Section 8, The Notaries Act, 1952]
3. Why are documents notarised?
Documents are notarised to ensure proper execution and prevent forgery and fraud. Before signing, the person signing is required to produce proper identification so that the notary can verify that the person signing is who he/she claims to be. The notary further ensures that the intended person signs the document of his own freewill. Notarisation also ensures that no one can fraudulently sign claiming to be you.
4. What is the effect of notarising a document?
Notarising a document adds a layer of authenticity to the execution of the document. A notarised document assures that the document is authentic and can be relied upon.
5. Are notarisation and attestation the same?
No.
When a document is signed before a notary, the notary verifies the identity of the person signing and that such person signs of his own freewill in the presence of the notary. Further, the person signing swears/confirms that the contents of the document being signed are true and that he has the authority to sign such document.
On the other hand, an attesting witness signs immediately after the execution of the document only for the purpose of proving and identifying the maker of the document.
While both notarisation and attestation witness execution of a document, notarisation can only be done by a notary public. Attestation can be done by anyone above the age of 18 and of sound mind.
6. Is it compulsory to notarise a Power of Attorney?
Yes.
Section 4 of the Powers of Attorney Act, 1882 requires that the execution of an instrument creating a power of attorney must be verified by affidavit, statutory declaration or other sufficient evidence.
Section 85 of the Indian Evidence Act, 1872 states that there is a legal presumption of the execution and authentication of a power of attorney that has been executed before, and authenticated by, a notary (or any Court, Judge, Magistrate, Indian Consul or Vice Consul or representative of the Central Government).
Section 57 of the Indian Evidence Act, 1872 lists down the facts of which a court must take judicial notice and sub section 6 includes the seal of a notary.
7. What laws govern notarisation?
The Notaries Act, 1952 and The Notaries Rules 1956
8. What are the qualifications required to become a notary?
(i) An advocate who has completed at least 10 years of practice (7 years in the case of women, Scheduled Castes, Scheduled Tribes and other Backward Classed), or
(ii) a person who is part of the Indian Legal Service under the Central Government, or
(iii) a person who has been at least for 10 years a member of Judicial Service or held office under the Central Government or State Government requiring special knowledge of law after enrollment as an advocate or held an office in a department of Judge Advocate General or in the legal department of the armed forces.
[Rule 3, The Notaries Rules, 1956]
9. Does the Notaries Act, 1952 recognise notarial acts done by foreign notaries?
Section 14 of the Notaries Act, 1952 provides that if the Central Government is satisfied that notarial acts done by notaries within India are recognized for all or some purposes by the law or practice of countries outside India, then notarial acts lawfully performed by notaries in such countries will be recognized in India for all or some purposes.
In furtherance of this power, notarial acts done by notaries in United Kingdom, the Isle of Man and Channel Islands comprising Guernsey and Jersey, Hungary, Belgium, New Zealand and Ireland are recognised for all purposes in India.
by LFIAdmin | Nov 25, 2020 | Uncategorized
By Nazaqat Lal, Advocate & Solicitor, Bombay High Court
nazaqat_lal@hotmail.com | Nov 30, 2020
The law of limitation governing the territory of India is contained in the Limitation Act, 1963 (“the Act”). The preamble of the said Act states that it is “An Act to consolidate and amend the law for the limitation of suits and other proceedings for purposes connected in addition to that.” (emphasis supplied) Being a consolidating act, as distinguished from an act that merely defines and amends certain parts of the law relating to that subject, the Act is largely exhaustive on the subject of limitation. However, the Act does recognize special laws that may provide a period of limitation different from the period stipulated under the Act.
The Act has factored in certain situations wherein the limitation period may need to be extended (Section 4), relaxed (Sections 5, 6 and 7) or completely done away with, as stipulated in Section 10. But it is pertinent to note that force majeure events do not expressly fall within any of the provisions providing for extension or relaxation of the strict rule of limitation.
The expression ‘force Majeure’ is of French origin. Under the French Civil Code, force majeure is a defence to a claim for damages for breach of contract. It needs to be shown that the event: made performance impossible, was unforeseeable, was unavoidable in occurrence and effects. [1] Force majeure clauses are incorporated in contracts as a way for parties to take a break in their performance obligations or terminate the contract in extreme circumstances under English Law.
Typically, a natural disaster, war or “act of God” would legitimately suspend or excuse the performance of the contract. This English law doctrine has been recognized in Sections 32 and 56 of the Indian Contract Act, 1872. However, applying the force majeure doctrine is not a blanket one. The party(s) to the contract would have to show inter-alia, the steps taken on their part, to mitigate the consequences, whether the time is of the essence of their contract, etc. before the court extends the time for performance of the contract or excuses non-performance thereof completely.
For litigation, the doctrine of force majeure would have to be considered slightly differently than in contract law. Whether a plea of force majeure would extend or relax the time otherwise permitted to a party to initiate proceedings by suit, appeal or application.
One can attempt to bring a situation of force majeure, particularly the situation of Covid-19, within the scope of Section 4, which provides for expiry of limitation when the courts are closed, or Section 5, which provides for an extension of the period of limitation in the case of appeal or application if “sufficient cause” is shown. However, it is pertinent to note that Section 5 applies to appeals and applications only and not suits. Therefore, the only benefit a potential plaintiff (who is not covered by any of the other relaxations or Section 10 of the Act) would get is under Section 4.
Section 4 would be applicable in a case where the expiry of the period of limitation falls on a holiday and, therefore, permits a plaintiff/applicant to file on the immediate next working day. If the limitation period expired during the lockdown imposed to curb the spread of covid-19, and suits, appeals, and applications were under section 4. They would have to be kept completely ready for filing and filed as soon as the court registry opens. In my view, this would neither be a fair nor pragmatic approach to take. Given that movement was severely restricted, public offices closed or functioned with minimum staff. Several other logistical factors involved utilizing the lockdown period as effectively as one would want to or need to prepare and file pleadings was not possible.
The potential plaintiff/applicant should not gain any additional or undue advantage due to the force majeure event. A potential defendant/respondent should also not be deprived of a right they would ordinarily have had. A solution will have to be found that factors the unprecedented force majeure event and the foundational principles of the law of limitation.
Keeping in line with the principles of the Act, the best solution to my mind would be to exclude the period of the force majeure event from the computation of limitation, i.e. freeze such period of force majeure, and the remainder or outstanding period of limitation would start running again once the effect of such force majeure event has ceased and normal functioning of courts has been restored. Specific to the case of Covid-19, (a) the period of lockdown, (b) the immediately preceding week(s) during which only very urgent matters were being taken up, and the Bombay High Court was working for lesser hours than normal as well as (c) any time after the lockdown is lifted, but courts do not resume work in full swing should be excluded from the computation of limitation.
In exercise of its powers under Articles 141 and 142 of the Constitution of India, the Hon’ble Supreme Court vide Order dated 23rd March 2020 [2] directed retrospective suspension of the law of limitation from 15th March 2020 onwards till further orders. Supreme Court has effectively frozen or suspended the running period of limitation from when the courts ceased to take up matters in the ordinary course. It will probably order the resumption of the law of limitation from the date courts begin to function at full strength and take up matters in the ordinary course.
The issue of limitation was bound to come up once courts resumed working and bypassing such Orders. The Supreme Court has obviated the need for such issues to be decided by each court separately and brought uniformity. While this was possible in litigation, it may not be so in the realm of contracts. In determining the effect of a force majeure event, particularly Covid-19, on contractual obligations, each contract will have to be considered on its own terms. At best, courts may be able to lay down some guidelines or principles applicable to a class of contracts.
[1] The NEC4 Engineering and Construction Contract: A Commentary by Brian Eggleston @ Pg. 124
[2] Suo Motu Writ Petition (Civil) No. 3/2020
by LFIAdmin | Dec 9, 2020 | Uncategorized
By Ms. Sandhya Tolat, Advocate and Solicitor
Sandhya.tolat@gmail.com | Dec 7, 2020
There is increasing awareness and judicial activism around medical negligence cases in India. Through legal jurisprudence over the years, the Hon’ble Supreme Court of India (SC) has upheld the Right to Health as a fundamental right under Article 21 of the Constitution of India, extended both to Indians and non-residents equally [1]. The Directive Principals of State Policy also imposes a duty upon States to provide proper and adequate medical and healthcare facilities.
Through this article we attempt to decode the complex dichotomy of a Patients’ Rights v/s Medical Professional Integrity and Autonomy and what constitutes medical negligence.
What is Medical Negligence?
The SC held “every doctor has a duty to act with a reasonable degree of care and skill” [2].Stringent onus is put on the complainant to prove negligence of the medical practitioner beyond reasonable doubt. The essential elements for medical negligence [3] are:
1. Medical practitioner owes a duty of care to the complainant.
2. Failure to inform the patient of risks involved.
3. If the risk was disclosed, patient would have avoided the injury/damages.
4. Defendant has breached this duty of care.
5. Complainant has suffered injury /consequential damages due to this breach.
6. Breach of the duty of care would give rise to an actionable claim of negligence.
Thus, liability of doctor does not simply arise when the patient has suffered injury, but when injury is resultant from the conduct of the doctor, which has fallen below that of reasonable care. To bring a case under medical negligence, the complainant must establish and prove all the above elements. In exceptional circumstances a complainant may invoke the principle of res ispa loquitur or “the thing speaks for itself” where no proof of negligence is required as the incident establish the negligence itself.
When is the Doctor Liable?
Not every medical case in which something goes wrong can be treated as a case of medical negligence. Some of the landmark judgments on doctor’s liability are discussed below:
1. A doctor can be held liable for negligence only if it is proved that he failed to act with reasonable care.
2. An error of judgement constitutes negligence only if a reasonably competent professional with standard skills that the doctor has, and acting with ordinary care, would not have made [4].
3. If doctor is skilled, has adopted right course of treatment in best interest of patient , considered “proper” by a body of medical professionals ,cannot be held negligent only because something went wrong [5] or because someone else of better skill or knowledge would have prescribed a different method or way of treatment or patient not cured [6].
4. Before issuing notice to a doctor basis complaint received, concerned authority should first refer it to a competent and specialized doctor/panel. Only if a prima facie case is established, should a notice be issued to the concerned doctor/hospital, so as to avoid harassment [7].
5. Hospitals held vicariously liable for the acts of negligence committed by the doctors engaged or empaneled by it [8].Likewise, a senior doctor shall also be vicariously liable for acts of his junior team members while attending to a patient.
Patient’s Legal Remedies?
1. Complaint-Consumer Protection Act,2019 (“Act”)
Medical services are explicitly included under the ambit of the Act [9] under the definition of “Services” and Deficiency of Services. A complaint can be filed before the District/State/National Consumer Dispute Redressal Commission depending on the value of services paid as consideration ( <1cr,>1cr <10 cr,>10 cr respectively) and appealed against, if dissatisfied. Hospitals providing medical services free of charge across board to all patients would stand outside the purview of the Consumer Protection Act (“Act”), whereas hospitals which render free services to a certain category of patients, while providing for services which are charged to the bulk of others, would not lie outside the purview of the Act [10].
2. Complaint-Indian Medical Council (IMC) Act,1956
Complaints for medical negligence can also be raised with the State Medical Councils constituted under the IMC Act where the accused doctors are registered. However possibility of a conflict of interest between the inquiry team and the accused doctors and technical questions raised by panel of doctors to patients causes an impediment to justice.
3. Civil Remedy- A Case of Negligence under Law of Torts
Under the torts law or civil law, a case of medical negligence is maintainable even if medical services are provided free. Patients can take recourse to tort law under negligence and claim compensation. Here, the heavy onus (burden) of proof is on the patient to prove what constitutes a medical negligence, as discussed in detail above.
4. Criminal Remedy- Section 304A of the Indian Penal Code,1890 (IPC)
A criminal complainant can be filed for medical negligence u/s 304A of the IPC where death of a person is caused by a rash or negligent act not amounting to culpable homicide. U/s 80 (accident in doing a lawful act) nothing is an offence that is done by accident or misfortune and without any criminal intention or knowledge in the doing of a lawful act in a lawful manner by lawful means and with proper care and caution. Likewise u/s 88, a person cannot be accused of an offence if act is performed in good faith for the other’s benefit, does not intend to cause harm even if there is a risk, and the patient has explicitly or implicitly given consent. It is held by SC [11] that “To impose criminal liability u/s 304-A, it is necessary that the death should have been the direct result of rash and negligent act of the accused, without other person’s intervention”.
The law around medical negligence has surely evolved over time, still much needs to be done, both, to give an impetus to patients’ rights for speedy justice and also for protecting honest and innocent medical practioners from harassment against wrongful complaints.
[1] State of Punjab v/s M.S Chawla (AIR 1997 SC 1225), Vincent Panikurlangara V/s Union of India (AIR 1987 SC 990)
[2] State of Haryana v/s Smt.Santra (AIR 2000 SC 3335)
[3] Maharaja Agrasan Hospital v/s Master Rishabh Sharma ( SC order dated 16.12.2019 in Civil Appeal 6619 of 2019)
[4] Spring Meadows Hospital & Anr v/s Harjol Ahluwalia & Anr (1998 4 SCC 39)
[5] Dr.Laxman Balakrishna Joshi v/s Dr.Trimbak Bapu Godbole (AIR 1969 (SC) 128)
[6] Dr.Prem Luthra v/s Iftekhar (200)11 CLD 37 (SCDRDC Uttaranchal)
[7] Martin F. D’Souza V. Mohd. Ishfaq2009;(2) Supreme Court 40
[8] Supra 3,Savita Garg v. National Heart Institute (2004) 8 SCC 56; Haribhau Khodwa v. State of Maharashtra (1996) 2 SCC 634;
[9] Indian Medical Association v. V P Shantha AIR 1996 SC 550: (1995) 6 SCC 651
[10] Supra 8, Union of India & Anr vs N.K.Srivasta & Ors (SC order dated 23.7.2020 in Civil Appeal 2823 of 2020)
[11] Kurban Hussein v. the State of Maharashtra(1965) 2 SCR 622
by LFIAdmin | Dec 9, 2020 | Uncategorized
By Admin, LegalFormatsIndia.com
Dec 9, 2020
Most of the “Startup” groups in India are unsure whether they should incorporate/register Partnership Firm, Limited Liability Partnership or Private Limited Company? What should be their Business Structure? There are options for formation of entries to run a small, medium and large size business. A “Startup” almost always thinks and plans for external funding in future. It is important to plan your actions in advance.
Here is the Chart giving few comparisons:-
FEW COMPARISONS BETWEEN PARTNERSHIP FIRM, LIMITED LIABILITY PARTNERSHIP (LLP) AND PRIVATE LIMITED COMPANY
hi
by LFIAdmin | Nov 25, 2020 | Uncategorized
By Kinjal Bhatt, Advocate
bhattkinj1@gmail.com | Nov 30, 2020
Under a contract, the Force Majeure clause is invoked to safeguard a party from the consequences of non-performance of the contract due to circumstances beyond the control of such party. It is an express provision by way of which the performance of the obligations under a contract may be excused or suspended. The term Force Majeure (“superior force” in French) is defined in the Black’s Law Dictionary “as an event or effect that can be neither anticipated nor controlled”. The Hon’ble Supreme Court of India has interpreted the term ‘Force Majeure’ in Dhanrajamal Gobindram v. Shamji Kalidas & Co. [1] and observed the following:
“The expression ‘force majeure’ is not a mere French version of the latin expression ‘vis major’. It is a term of wider import. Strikes, breakdown of machinery, which, though normally not included in ‘vis major’ are included in ‘force majeure’ …where reference is made to “force majeure”, the intention is to save the performing party from the consequences of anything over which he has no control. This is the widest meaning that can be given to ‘force majeure’…”
The term ‘Force Majeure’ has a much wider import than merely an ‘Act of God’ [2] and shall also include an ‘uncontrollable event’ [3]. The Supreme Court in the case of Industrial Finance Corporation of India v. Cannanore Spinning & Weaving Mills Ltd. [4] interpreted ‘Force Majeure’ to include non-performance for reasons of an impediment beyond one’s control which could neither be foreseen at the time of entering into the contract nor can the effect of the supervening event be avoided or overcome. However the Indian Courts have not directly ruled on whether an epidemic/ pandemic like Covid-19 is an ‘Act of God’, an argument to that effect can derive support from the decision of the Hon’ble Supreme Court in the case of The Divisional Controller, KSRTC v. Mahadava Shetty [5], wherein it has been held that the expression ‘Act of God’ signifies the operation of natural forces free from human intervention with the caveat that every unexpected natural event does not operate as an excuse from liability if there is a reasonable possibility of anticipating their happening.
A. The Force Majeure Clause: Phraseology
A Force Majeure provision cannot be implied under Indian Law. It has to be to be expressly provided for under the contract. The phraseology of the Force Majeure clause plays a pivotal role in ascertaining whether a particular event would fall within the ambit of the said clause. Therefore, some clauses contain specific terminologies so as to protect the parties to the contract which may include terms like ‘non-fulfilment of obligations due to restrictions imposed by the Government’, ‘non-fulfilment of obligations due to unforeseen events’ and/or may specifically state the occurrence of such an event like a pandemic, epidemic or a natural calamity.
A Force Majeure clause may also provide for the party invoking the said clause to notify the other party/parties within a specified period of time from the occurrence of the event/circumstances that have rendered the performance of the contract impossible [6]. The nature of the contract, the intention of parties and the phraseology of the Force Majeure clause shall determine whether the Force Majeure clause relieves the party/parties of their obligations to the contract or simply affords them the liberty of delayed performance.
The burden of proof of the unforeseen event/circumstances that have rendered the performance of the contract impossible shall lie on the party invoking the Force Majeure clause who may also be required to demonstrate that it has taken all reasonable efforts to avoid or mitigate the Force Majeure event and its effects. The Hon’ble Supreme Court in case of Jerryl Banait v. UOI [7] has termed the current Covid-19 situation as a “national calamity”, which phraseology may be helpful in interpreting force majeure clauses in contracts executed between the parties.
B. The Doctrine of Frustration
The Doctrine of Frustration, introduced by the Court of Queen’s Bench in Taylor v. Caldwell [8] provides for temporary discharge of obligation on the ground of impossibility of performance on account of unforeseen circumstances. The said doctrine also finds place under Section 56 of the Indian Contract Act, 1872 (the ‘Contract Act’). The sine qua non for invoking such a clause is (a) existence of a valid contract between the parties; (b) the contract is yet to be performed; (c) the performance of the contract has become impossible due to the prevailing circumstances. It is pertinent to note that the Doctrine of Frustration can only apply to executory contracts and not the transactions, which have created a demise in praesenti [9].For a contract to be rendered frustrated, the change in circumstances must be so fundamental as to be regarded by law as striking at the root of the contract [10].
The word ‘impossible’ under Section 56 of the Contract Act need not be interpreted with respect to physical or literal impossibility. To ascertain whether a contract is frustrated, the performance of an act may not necessarily become physically/literally impossible. The impracticality of performance with respect to the parties and the object of the agreement will also have to be taken into account [11].
Force Majeure and Doctrine of Frustration of contract have been continuously regarded as exceptional defenses in events of complete impossibility. While the threshold of proof shall continue to be high, the Courts will ascertain practicalities of the situation more dynamically. Hence, a surge in the number of commercial contracts incorporating Force Majeure clauses is very likely – to specifically cover situations such as Government imposed lockdowns, epidemics and pandemics, apart from traditional events such as Act of God, natural calamities, etc.
[1] AIR 1961 SC 1285.
[2] Ibid 1; Please also see Assam State Co-operative Marketing and Consumers’ Federation Limited v. Anubha Saha & Ors. [2000 SCC Online Gau 39].
[3] Gujarat Urja Vikas Nigam Ltd. v. Tarini Infrastructure Ltd. & Ors. [(2016) 8 SCC 743].
[4] (2002) 5 SCC 54.
[5] 2003 7 SCC 197
[6] A.I.R. 1955 Hyd. 233 – Shree Krishen v. Gambhirmal; A.I.R. 1957 Pat 586 – Dominion of India v. Bhikhraj Jaipuria; 2009 (16) SCC 208- M.D., H.S.I.D.C. v. Hari Om Enterprises; A.I.R 2008 A.P. 264 – Alluri Narayana Raju v. Dist. [8] Collector, Visakhapatnam Dist.
[7] 2020 SCC OnLine SC 357
[8] [1863] EWHC QB J1
[9] 2003 (12) SCC 91 – Ganga Retreat & Towers v. State of Rajasthan
[10] Naihati Jute Mills Ltd. v. Hyalira Jagannath, 1968 (1) SCR 821.
[11] Satyabrata Ghose v. Mugneeram Bangur& Co. [1954 SCR 310 (12); Also see: Sushila Devi v. Hari Singh [AIR 1971 SC 1756]; AIR 1986 SC 156 – U.P. State Electricity Board v. Kanoria Chemical; AIR 2002 SC 2290 – NirmalaAnand v. Advent Corporation Pvt. Ltd.; 2016(13) SCC 561 – DDA v. Kenneth Builders; 2014 (14) SCC 272 – Mary v. State of Kerala; 2004 (9) SCC 619 – M.D.Army Welfare Housing Organization v. Sumangal Services; 2004(6) SCC 537 – HPA International v. Bhagwandas Fateh Chand; 1999(5) SCC 77 – K. Narendra v. Riviera Apartments; 2007 (12) SCC 175 – Rozan Mian V. Tahera begum and Ors.
by LFIAdmin | Nov 25, 2020 | Uncategorized
By Shlok Parekh- Advocate, Bombay High Court
Parekhshlok24@gmail.com | Nov 30, 2020
History of the Doctrine
The Clean-Slate doctrine was developed in the late 19th century under the influence of voluntaries theory, which dominated the International Law during that period. According to the said theory, the sovereign state can only enjoy rights and incur obligations to which they consent. Therefore, the rights and the obligation of the predecessor state relating to the territory transferred cannot be considered to automatically pass to the successor state. In essence, the clean slate doctrine which meant at that point was, when a state is captured by another state, the rights and obligations of the predecessor sate cannot be considered to automatically pass to the successor state.
The Clean Slate doctrine is completely opposite to its predecessor doctrine of Universal Succession (also known as the doctrine of continuity) which provided that the rights and the obligations of the predecessor state, relating to the territory transferred, as transmitted to the successor state. Thus, the successor state gains the treaty rights and obligations of the predecessor state, relating to the territory transferred. As well as, the successor state inherits the public property and the debts belonging to the predecessor state relating to the territory transferred.
Both the Universal Succession and the Clean Slate doctrine have been highly criticized by the scholars. It has been argued that neither doctrine makes sense with respect to cases of cession of territories.
Examples of both the “universal succession” and the “clean slate” doctrines can be found in the practice of States. Thus, while the “universal succession” doctrine governed the emergence of Dominions, such as Canada, as independent States, the “clean slate” doctrine was invoked by Israel. However, State practice rarely reflects either the “universal succession” doctrine or the “clean slate” doctrine in their entirety. In most cases of State succession, some rights and obligations relating to the territory transferred are transmitted from the Predecessor State to the Successor State, while others are not.
Clean Slate in IBC
The doctrine of Clean Slate finds its roots in the Insolvency and Bankruptcy Code (“Code”) in the newly introduced Section 32A read with Section 31(1) of the Code. The theory of clean slate has also been put into effect by the Hon’ble Supreme Court of India in the landmark judgment of Committee of Creditors of Essar Steel India Ltd. v. Satish Kumar Gupta & Ors.[1], (“Essar Steel Judgment”) decided on 15th November 2019.
The doctrine of Clean Slate in IBC comes into effect only after the Resolution Plain is approved by the Committee of Creditors, which is to say that the said Resolution Plain is binding on all the stakeholders, including the guarantors. Therefore, in order to explain the same, His Lordship the Hon’ble Mr. Justice R. F. Nariman stated the following in the Essar Steel Judgment:
“66- Section 33(1)of the Code makes it clear that once a resolution plan is approved by the Committee of Creditors it shall be binding on all stakeholders, including guarantors. This is for the reason that this provision ensures that the successful resolution applicant starts running the business of the corporate debtor on a fresh slate as it were”
The Supreme Court therefore has interpreted Section 31(1) of the Code to say that the successful Resolution Applicant should start running the revived company on a fresh slate vis-à-vis adopting the doctrine of clean slate. The Supreme Court has laid down the emphasis on the revived company starting a new life and therefore the doctrine of clean slate is important, so that the revived company is not burdened with the litigations and outstanding dues of the old company.
It is pertinent to note that the Counsel for one of the parties in the Essar Steel Judgment argued that in Section 60 (6) (which is for computing period of limitation specified for any suit or application by or against Corporate Debtor and excludes the period of moratorium), the legislation has intended to allow litigations to continue even after the CIRP process has ended. This argument was negated by the Supreme Court to say the following:
“67- For the same reason, the impugned NCLAT judgment in holding that claims that may exist apart from those decided on merits by the resolution professional and by Adjudication Authority/Appellate Tribunal can now be decided by an appropriate forum in terms of Section 60 (6) of the Code, also militates against the rational of Section 31 of the Code. A successful resolution applicant cannot suddenly be faced with “undecided” claims after the resolution plan submitted by him has been accepted as this would amount to a hydra dead popping up which would throw into uncertainty amounts payable by a successful resolution applicant who successfully takes over the business of the corporate debtor. All claims must be submitted to and decided by the resolution professional so that a prospective resolution applicant knows exactly what has to be paid in order that it may then take over and run the business of the corporate debtor. This the successful resolution applicant does on a fresh slate, as has been pointed out by us hereinabove. For the reasons, the NCLAT judgment must be set aside on this ground.”
Therefore, by virtue of the Essar Steel Judgment, the Supreme Court has made it amply clear that, the doctrine of clean slate applies to the Code, pursuant to the Committee of Receiver and thereafter the Adjudicating Authority accepting the Resolution Plan. The Supreme Court’s analysis is logical as much as to say that the Resolution Applicant, in order to take over the Operational/Financial Creditor, will be bringing in a huge sum of money to pay all the debts and therefore after having paid the said debts, it would be unfair to then burden the Resolution Applicant with undecided claims, which can in some cases be a loss making proposition for the Resolution Applicant. Assuming the situation, if the Resolution Applicant is burdened with the undecided claims, no company would want to come forward and take over a company which has undecided debts even after paying a reasonable high amount and therefore the same will defeat the very purpose of the Code, which is to revive the insolvent company. Therefore, in order to give effect the main objective of the Code, it was utmost important for the Supreme Court to introduce the doctrine of clean slate and in the Code.
Pursuant to the Essar Steel Judgment, the Rajasthan High Court in Ultra Tech Nathdwara Cement Ltd. v. Union of India [2] also applied the doctrine of clean slate. Ultra Tech has taken over Binani Cements after emerging as a successful Resolution Applicant and had paid all the dues as admitted by the Resolution Professional in terms of the Resolution Plan. The GST department demanded GST dues from Ultra Tech of Binani Cement until the date of approval of the Resolution Plan. The Hon’ble Court held that no new demands as to any claims can be raised by any creditor after the acceptance of the Resolution Plan, which is the date the Resolution Applicant successfully takes over the company.
The only debatable point which arises is that the Code does not provide for extinguishment of proceedings. The proviso under Section 14 states that “moratorium shall cease to have effect from the date of the approval of the Resolution Plan” which seems to suggest that adjudication of claims, which are in dispute before the appropriate forum may continue, after the moratorium comes to an end. The doctrine of clean slate seems to have not settled this facet in a way. The discrepancy arises to an extent that, if the disputed claims are to be adjudicated after the end of the moratorium, then is the section suggesting that the successful Resolution Applicant should be burdened with undecided claims, even after having paid the required amounts as decided by the Resolution Professional. Therefore, for the purpose of argument, this section negates the doctrine of clean slate and hence the interference of the Supreme Court is required for the same.
Conclusion:
In view therefore, though Supreme Court has very explicitly made the applicability of the Doctrine of clean slate as a part of the Code, but there still lies a discrepancy when the observations of the Supreme Court are read with the provisions of the Code, more specifically being proviso to Section 14 of the Code. The said proviso was not dealt by the Supreme Court in the Essar Steel Judgment, and therefore it is assumed that sooner or later, the Supreme Court is going to get one more opportunity to interpret the doctrine of clean slate again.
[1] Civil Appeal No. 8766-67 of 2019
[2] D.B. Civil Writ Petition No. 9480/2019- Rajasthan High Court (Jodhpur Bench)
by LFIAdmin | Nov 25, 2020 | Uncategorized
By Aishwarya Vashishth, Final Year Student at Jindal Global Law School
aishwaryavashishth07@gmail.com | Nov 30, 2020
‘Ivory’ is a rare and valuable substance that is usually procured from the teeth or tusks of certain animals. The Convention on International trade in Endangered Species of Wild Flora and Fauna (CITES) had banned ivory trade due to the rapid extinction of many African elephant populations [1].During the 1980s, the international ivory trade averaged some 800-100 tons per year, demonstrating the killing of almost 100,000 elephants per year. In recent times, many countries have expressed their wish to start a controlled trade in ivory subject to some limitations [2].
In the case of Indian Handicrafts Emporium and others vs. Union of India and others, the appellants are involved in the business of manufacturing and selling articles made from ivory, the trading of which had been banned by the union of India. The applicability of the Wildlife (Protection) Act of 1972 as well as the constitutional validity of the subsequent amendments to the said act were challenged by the appellants. This commentary tends to focus on the multiple arguments that were raised by the both sides and analyze them using different perspectives.
PROCEDURAL HISTORY
The appellants had filed writ petitions before the High Court of Delhi, challenging the constitutionality and validity of the 1991 Amendment Act that led to the prohibition of ivory trade. The High court had put a stay on the operation of the act by an interim order for a period of two months after which the court upheld the vires of the said act which gave rise to the current set of appeals before the Supreme Court of India [3].
FACTS OF THE CASE
The appellants had imported ivory from African countries between 1971 and 1986 and manufactured some articles out of it. They were in possession of 756 kgs of ivory articles. The 1986 amendment to the Wildlife Protection Act banned the trade of wild animals, animal articles, trophies etc. The 1991 amendment to the said act imposed a complete ban on the imported ivory trade and provided a stipulated period of six months for the disposal of the ivory stocks. The appellants contented that the act was unconstitutional and violated their right to property by not provided appropriate compensation.
MAIN LEGAL ISSUES
According to one of the first issues raised by the appellants, the impugned provisions of the act in question are violative of Article 19 (1) (g) where the right of appellants to practice their profession of ivory trade was being curbed. The appellants also alleged that this prohibition on traders was unreasonable and arbitrary under Article 14 of the Constitution.
Another issue faced by the court was whether the ivory imported into India before the amendment could be sold by the traders, or on what conditions could the ivory be retained for personal use.
Additionally, there was another question that was faced by the Apex Court where the right to property of the appellants was being violated as a result of the 1991 Amendment Act.
JUDGEMENT
The Supreme Court ruled in favour of the respondents in this case, where it opined that the prohibition on the ivory trade in India was permissible and reasonable. It was not violative of Article 19 (1) (g) of the Constitution. This was reasoned by discussing the dangers to ecology that the ivory trade posed along with emphasis on the dangers posed to the Indian Elephant. The Apex Court also held that the right to property was a constitutional right but was not a fundamental right where any and all claims to property would not be understood as a property right.
ANALYSIS
In the case of Indian Handicrafts Emporium v. Union of India, one is not only faced with the issues relating to the Wildlife (Protection) Act, 1972, but also matters of complex constitutional interpretation along with a brief contact with international law. According to the facts and circumstances of this case, as discussed earlier, the Appellants used to trade in ivory before its trade had been banned. The court, in its Judgment, does not contest the status of the Appellants as traders, since before the enactment of the 1991 Amendment Act, they used to engage in a trade of goods that were not illegal.
One of the major contentions of the Appellants was that the 1991 Amendment Act placed arbitrary restrictions on their right to carry out their trade, under Article 19 (1) (g) of the Constitution. Since ivory trade was not banned before the said 1991 Amendment, the Appellants were indeed recognized as traders, but the Court was adept at providing justifications for curbing this erstwhile legal trade. The Court held that this ban would not constitute an unreasonable restriction since the safety of the ecology and a sharply dwindling species was at stake. This reasoning is important considering the dynamic nature of the environment; animals, objects, resources that once might have been an acceptable source of income by way of a legitimate trade, might be prohibited or restricted as per the need of the hour.
To understand what exactly the term reasonable restriction implies, the court refers to a couple of case laws. In the case of Narendra Kumar v. UOI, it was held that the word restriction can include cases of prohibition. The court needs to balance the direct impact on the fundamental rights of the citizens against the greater good of the society to determine whether a total prohibition would be reasonable or not. The court re-emphasis on the competence of the legislature and its powers in such a matter where a ban and the subsequent measures to ensure the effectiveness of the ban rested with the legislature itself. The Court re-emphasized settled law on the matter where the provisions of the act should be in coherence with the object that it intended to achieve.
In this case, this objective was to ensure that the ecological and environmental security of India be enforced. The Court then uses the case of Municipal Corporation of the City of Ahmedabad V. Jan Mohammed Usman Bhai and Anr. where the Supreme Court had held that while determining the validity of a law which placed restrictions on a fundamental right, the burden of proving that the restriction was reasonable lies on the state. The tests of reasonableness need to be viewed from the prospective of furthering the social interests that the legislation intends to promote. The enacted law must intend to solve the problems envisaged and should be in the interests of the general public.
The major objective of the act, as mentioned in the Judgment, was to protect the illegal killing of the Indian Elephant. The import of ivory from Africa had been prohibited since it was felt by the legislature that imported ivory trading might implicitly promote the illegal sale of ivory obtained from the Indian Elephant. However, in the judgment, there seems to be no explicit discussion on the area where a clear nexus between the import of ivory from Africa and the increase in sale of illegal ivory was reasonably concluded. There exist several items that are restricted for import into India but could be imported in certain circumstances. These include certain live birds and animals, semi-processed hides and skins, endangered species of plants and animate, certain vintage products, amongst others. In many of these scenarios, the production or making of these items is prohibited, but impact under special circumstances is permitted [4].
The 1989 ban of ivory by the CITIES, and its inclusion of Appendix I, might have led to a reduction in ivory trading, but it would not essentially mean that the peaching of elephant has markedly reduced. The complete prohibition of ivory trade could have counterintuitive effects where the scarcity of supply could lead to a severalfold increase in price, thus defeating the purpose of the legislation. This could have an impact on the reasonableness of this restriction on the trade of imported ivory [5]. The Court was extremely clear in opining that India, as a sovereign country, was not bound to follow exactly certain were needed, then those would be applied by the legislature.
There were also contentions by Appellants that they be allowed to trade with the ivory of dead animals by way of a natural death and not poaching. It was also argued with the assistance Supreme Court precedents that if the statute had been vague in certain areas, then the amending should be ultra vires. This was supported with certain modifications to CITIES, as elephants had been placed into Appendix II of the convention from Appendix I. The former was a stricter category inviting more stringent bans, whereas in the latter regulated trade could still continue [6]. It was argued that the resurging elephant number in Africa did not require stringent protection as envisaged by the Act, where its nexus with the Indian Elephant’s Population was weak. One could, for the sake of legislative interpretation, analyse this judgment, through the lens of Balram Kumawat v. Union of India, which was passed by the Supreme Court in 2003.
In this Judgment, the Supreme Court applied the reasoning of Indian Handicrafts Emporium to ban the trade of mammoth ivory in spite of it being extinct [7]. The Appellants had appealed against the Judgment of a division bench of the Delhi High Court and had urged that the Court had made an error since mammoths were deceptively similar to elephants. It was argued that the substance ivory and its chemical composition could be found in whales, walruses, hippos, etc. and that the word ivory could not possibly cover all these animals, when the intention was manifestly directed towards the Indian Elephant.
In this case, it was upon the Apex Court to adopt either a lenient or strict construction of the term ivory, and whether it could be applied to mammoth tusks. In this judgment, the court did not look favourably towards the perspective that would be against the intended social goals of the law and would thus make the impugned legislation futile. The Court acknowledged the perils of assigning any ordinary dictionary meaning to a word over its technical meaning but differentiated the same by giving the justification that the impugned statute was not one like tax statutes but was for the higher purpose of ecological protection [8].
It held that a purposive interpretation of a stature and its risks did not need to be discussed in the case, and that the Parliament had enacted the 1986, 1991 and 2003 amendments not only to protect the Indian Elephant, but also to obstruct the activities of poachers with a goal of complete prohibition of ivory irrespective of its biological or geographical source. The Court placed full reliance on the Indian Handicrafts Emporium case in arriving to its conclusions, both in reasoning in relation to the ambit of the word ivory, and in the powers of the administrative authorities regarding the power to use thin discretion.
CONCLUSION
In light of the above analysis of the Indian Handicrafts Emporium Case and its aftereffects, it is clear that the Supreme Court had chosen an approach towards the protection and conservations of wildlife. In providing its reasoning in the areas of exceeding the limits of CITIES restrictions, expanding the ambit of ivory to not only include ivory from elephants, but also from mammoths and other animals. The court has definitely taken an extremely strict interpretation of the statute. The intentions and effects of this judgment undoubtedly seem to be complementing the legislation, and they end up give more power to the state to restrict and prohibit certain detrimental activities in relation to the environment and its conservation. This support of the highest court of the land is essential in these troubled times of rising water levels and smog, as we head towards a mass extinction of life as we know it.
[1] Scott Hitch, Losing the Elephant Wars: CITES and the Ivory Ban, 27 Ga. J. Int’l & Comp. L. 167 (1998).
[2] Andrew Dobson & Joyce H Poole, Ivory: Why the Ban Must Stay!, 6 Conservation Biology 149-151 (1992).
[3] Indian Handicrafts Emporium and Others v. Union of Indian and Others, AIR 2003 SC 3240.
[4] Restricted Items | Directorate General of Foreign Trade | Ministry of Commerce and Industry | Government of India, Dgft.gov.in (2017), https://dgft.gov.in/policies/restricted-items (last visited Nov 5, 2019).
[5] Branden D. Jung, The Tragedy of the Elephants, 2017 Wis. L. Rev. 695 (2017).
[6] Angela Ostrowski, (Elephant) Death and Taxes: Proposed Tax Treatment of Illegal Ivory, 21 Animal L. 221 (2015).
[7] Balram Kumawat v. Union of India, AIR 2003 SC 3268.
[8] Id. at 2.
by LFIAdmin | Nov 23, 2020 | Uncategorized
By Harsha Sawant, Advocate
sawantharsha20@gmail.com | Nov 30, 2020
Criminal trial
A criminal trial is designed to resolve accusations levied (usually by the State) against a person accused of a crime. The rights afforded to criminal defendants are typically broad. The rules of criminal procedure provide rules for criminal trials.
A criminal trial can be understood by the procedural understanding of the functioning of criminal courts wherein, it is a stage, that begins after framing the charge and ends with conviction or acquittal.
An English trial in simple words, can be defined as a formal examination of evidence by a judge, typically before a jury, in order to decide guilt in a case of criminal or civil proceedings.
In India the system of jury has long been abolished. A criminal trial however is the analysis and examination of Evidence in order to either convict or acquit the alleged accused.
Criminal trials in India are conducted as per the provisions of the Code of Criminal Procedure, 1973.
Types of Trials as per the Code of Criminal Procedure
As per CRPC the procedure to conduct trial of an accused charged with an offence is distinguished as per the tenure of Punishment of the alleged offence. The trial of an accused as per the Offence committed by him is divided into five parts.
1. Complaints to Magistrate
2. Sessions Trial
3. Warrant Trial
4. Summons Trial
5. Summary Trial
I. Complaints to Magistrates.
This is discussed under Chapter XV under the provisions of section 200 of Cr PC. If both the local police station and the superior officer refuse to register an FIR, the informant/Complainant can approach the Magistrate under Section 156(3) of Cr PC seeking direction to the police to investigate in the matter and further Issue Process directing the Superior Police Officer having jurisdiction to arrest the Accused and further register an FIR.
The Procedure for conducting trial when a private Complaint is made to the Magistrate is discussed under Sections 200 to 210 of the Cr PC.
In Devarapalli Lakshminarayana Reddy[1] the Supreme Court explained the power of the Magistrate under Section 156(3) and Sections 200 and 202 of Cr PC. The following discussion and ultimate conclusion are relevant which reads as under:
It is well settled that when a Magistrate receives a complaint, he is not bound to take cognizance if the facts alleged in the complaint, disclose the commission of an offence. This is clear from the use of the words “may take cognizance” which in the context in which they occur cannot be equated with “must take cognizance”. The word “may” gives discretion to the Magistrate in the matter. If on a reading of the complaint he finds that the allegations therein disclose a cognizable offence and the forwarding of the complaint to the police for investigation under Section 156(3) will be conducive to justice and save the valuable time of the Magistrate from being wasted in enquiring into a matter which was primarily the duty of the police to investigate, he will be justified in adopting that course as an alternative to taking cognizance of the offence, himself.
II. Sessions Trial.
The act classifies certain categories of cases, which are triable by the Sessions Judge. In compliance with S. 209 of the Cr PC when the accused appears before the Magistrate, the Magistrate shall further commit the case before the Court of Sessions. Provisions for trial of a Sessions Case are provided under Chapter XVIII from section 225 to 237 of Cr PC.
Also for an offence to be tried by the Court of Sessions, the tenure of punishment shall be more than seven years of imprisonment or Life imprisonment or Death. All sexual offences against Women and Children are tried by the Sessions Court.
III. Trial of Warrant Cases.
Warrant Triable Cases are classified under chapter XIX. Offences punishable for a tenure of more than 2 years of Imprisonment or more are tried as warrant cases.
A trial in a warrant case begins either by filing an FIR in a Police Station or by filing a Complaint before a Magistrate. Procedure for trial of Warrant Cases is provided under section 238 to 250 of Cr PC.
IV. Trial of Summons Cases.
Any offences wherein the tenure of punishment does not exceed two years shall be categorized as summons cases. Trial of cases by summons procedure is provided in Chapter XX of the Code from sections 251 to 259.
V. Summary Trials.
The Procedure for trial of a Summary triable case is similar to that of a warrant and summons case. However, the difference is that the evidence in such trials is not discussed exhaustively and they are majorly petty offences. Summary trials are discussed in details in Chapter XXI of Cr PC from section 260 to 265.
No sentence of imprisonment for a term exceeding three months shall be passed in the case of any conviction under this Chapter.
“Trial of cases by summons procedure is provided in Chapter XX of the Code. Instead of Charge being framed, substance of accusation is to be read over to the accused and his plea has to be recorded. Prosecution evidence and the defense evidence is required to be taken but evidence is not to be recorded or dealt with in the manner provided under Sections 275, 278 and 279 of the Code memorandum of substance of the evidence is prepared and that is not required to be read over to the witness nor his signature is required to be taken. Procedure for summary trial is prescribed in Chapter XXI of the code. The procedure for summary trials is exactly the same as the procedure for trial of summons cases. Warrant case procedure being more elaborate provides better opportunity to the accused to defend himself. The summons or summary procedure is prescribed only for trial of comparatively minor offences involving comparatively lesser sentences. In serious cases, it is open to the Magistrate to convert summons case into a warrant case, as seen in Section 259 of the Code. The purpose of providing summons of summary procedure is to shorten the record and the work of the Magistrate and save his time. The power of the Magistrate to try cases summarily under Section 209 is discretionary. The offences under the Act being offences against the health and wellbeing of people, it is necessary that these cases should be dealt with expeditiously.”
Jagdish Prasad vs. State of M.P. and Ors. (03.01.1995 – MPHC)[2]
“In every case tried summarily in which the accused does not plead guilty, the Magistrate shall record the substance of the evidence and a judgment containing a brief statement of the reasons for the finding.
Thus, the Magistrate is not expected to record full evidence which he would have been, otherwise required to record in a regular trial and his judgment should also contain a brief statement of the reasons for the finding and not elaborate reasons which otherwise he would have been required to record in regular trials.”
J.V. Baharuni and Ors. vs. State of Gujarat and Ors. (16.10.2014 – SC)[3]
Procedure for conducting Criminal Trials.
Chapters XV to XXI state the procedure for conducting Criminal Trial.
Every Trial begins post producing the Police Report (charge sheet) in the Court having Jurisdiction to try the offence and further presenting the Accused before the Magistrate. At this step the offence alleged upon the Accused is explained to him and he is asked whether he pleads guilty to the alleged offence. If the Accused pleads guilty, the Magistrate grants him Conviction whereas, if the accused pleads not guilty the Magistrate shall proceed with the trial by Examination-in-chief of the prosecution witnesses, followed by the cross-examination by the Defense of the Prosecution witnesses and further by presenting defense witnesses for Examination-in-chief and Cross-examination by the Prosecution.
However, upon receiving of the Police Report the Magistrate finds that the Case is Sessions Triable, he shall further commit the case to Sessions Court where in the procedure is then conducted by the Sessions Court Judge in the similar manner as above.
In situation wherein the Complaint is directly made to the Magistrate it will be categorized as cases instituted otherwise than on a Police Report. In this scenario the Magistrate shall examine the Complainant upon oath, post which at the discretion of the Magistrate as per Section 200 of Cr PC, he shall take cognizance of the offence and issue process against the Accused. After process is issued against the Accused if the offences illustrate that the case is a Summons Case, a Summons is issued to the Accused whereas if the case is a Warrant Case a warrant may be issued to him and he may be arrested by the Police Authorities.
An exception to the procedure of conducting a trial, is a Summary Triable Case where in the Evidence lead by the Prosecution is not at length and Judgement contains a brief statement of the reason for finding the same is recorded.
Upon taking Evidence if the Magistrate finds the Accused not guilty he shall record an order of Acquittal. Where in case the Accused is proven Guilty of the alleged offence the Magistrate shall after hearing the accused on the question of sentence, pass sentence upon him according to law.
India has a highly developed criminal jurisprudence and prosecution system, supported by judicial precedents. There are however many issues and concerns relating to the execution of the same by Police and implementation by Judiciary. The courts in India, particularly High Courts and Supreme Court have been proactively guarding the rights of the accused. Even Article 21 of the Constitution of India has been interpreted in a highly dynamic manner to protect the rights, life, and liberty of the citizens, by also incorporating the principles of natural justice.
[1] MANU/SC/0108/1976
[2] MANU/MP/0636/1995
[3] MANU/SC/0995/2014
by LFIAdmin | Nov 25, 2020 | Uncategorized
By Amritha Vyas, Associate Advocate, Gajria and Co.
amritha@rgajria.com | Nov 30, 2020
INTRODUCTION:
This question has been laid to rest by a Special Bench of five judges of the Delhi High Court in Carlsberg Breweries A/S. vs. Som Distilleries and Breweries Ltd. reported as 256 (2019) DLT 1. The Delhi High Court held that a composite suit in relation to the infringement of a registered design and passing off in relation to the same design, where the parties are the same, is maintainable in a court of law.
The primary issue before the court was whether a composite suit joining the two causes of action (one for infringement of a registered design and the other for passing off of the plaintiff’s goods) was maintainable?
The court allowed the joinder of the suits in the case on account of “existence of common questions of law and fact between the two causes of action” i.e. infringement of a registered design and passing off.
FACTS:
The present suit was filed, by Carlsberg complaining that Som Distilleries had adopted an imitation of its registered bottle design, trademark and trade dress to sell its Hunter beer which amounted to infringement of design and trademark, as well as passing off. Carlsberg also filed an injunction application to restrain Som from carrying out its infringing activities. The interim injunction application was considered by the court and it ruled in favour of Som.
Carlsberg’s claim was based on the distinctive dress up of its Tuborg beer bottle registered under the Design’s Act, 2000 and common law right in the distinctive shape of the bottle.
Som Distilleries responded by stating that two claims for passing off and relief for design infringement [as per Mohan Lal v Sona Paint, 2013 (55) PTC 61 (Del) (FB)], could not be combined in one suit.
In the case of Mohan Lal, the Full Bench formulated three questions to be determined; the third issue being:
“III. Whether the conception of passing off as available under the Trade Marks can be joined with the action under the Designs Act when the same is mutually inconsistent with that of remedy under the Designs Act, 2000?”
The full bench held that “composite suit for infringement of a registered design and a passing off action would not lie”.
For design infringement, the test to be applied is of a knowledgeable person who knows the field and not of any customer. Further, design resides in the shape of the bottle without the label and when the designs of the bottles are compared there are marked differences.
There was no novelty in Carlsberg’s bottle design, as the shape, pull caps and labels are common to the trade over which no monopoly can be claimed.
Thus, the single bench in respect of Carlsberg was of the view that the issue as decided in Mohan Lal’s case needed re-examination, hence, the Special Bench was constituted.
JUDGEMENT:
The Special Bench considered two important issues from the present case:
1. If two causes of action cannot be clubbed, is the court compelled by law to reject a Plaint for misjoinder?
2. Are the two causes of action, i.e. a claim for design infringement and the other for passing off, so different that the court cannot try them together in one suit?
For the first issue, the court came to the conclusion that, for a composite suit with different causes of action, the court will only entertain if it has the jurisdiction of both subject matters. The Court also held that misjoinder by itself is not sufficient to entitle the Defendant to have the proceedings set aside or action dismissed.
In the second issue, the court suggested that a composite suit has the advantage of a “bird’s eye view” by the court, with respect to a common set of facts. If for some reason, the claim for design infringement is prima facie weak and the plaintiff cannot secure interim relief, it does not have to face the uncertainty of another action before another court. The same court can review the same facts and evidence. Also, if the facts that compel a Plaintiff to approach a court, complaining of design infringement are the same as passing off, then it is inconceivable that a cause of action can be split in some manner and presented in different suits.
The bench held that there is a significant difference between causes of action relating to design infringement and those based on passing off, that the factual overlap is with respect to presentation in the design and the novelty, and in a passing off action, the distinctiveness of the mark and association with the owner.
The bench came to a conclusion that to establish infringement of a design, fraudulent imitation has to be proved. Similarly, in a passing off action it is necessary for the Owner of the mark to establish that the Defendant has misrepresented to the public irrespective of the interest, that its goods are those of the Plaintiff and the resulting harm to its reputation is actionable.
COMMENTS:
It is, thus, possible to club two causes of action arising out of the same facts i.e. for infringement of a registered design and passing off against the same Defendant in one suit so as to avoid multiplicity of proceedings which will otherwise result in waste of time, money and energy of the parties and also that of the courts. Provisions for joinder of multiple causes of action, where the court has jurisdiction to entertain one cause of action and not the others, are also contained in Clause 14 of the Letters Patent of the High Courts of Bombay, Madras and Calcutta.
This provision is often invoked in cases of Trade Mark infringement where the court has jurisdiction to entertain the cause of action for infringement but not passing off as the products are not available within the jurisdiction of the court or the Defendant does not reside or carry on business within the jurisdiction of the court.
by LFIAdmin | Nov 24, 2020 | Uncategorized
By Heena Thalesar, Advocate
heenathalesar2233@gmail.com | Nov 30, 2020
Whether the author of a work, even after the assignment of the concerned work, would have special rights to claim authorship of his/her work provided under Section 57(1) of the Copyright Act, 1957?
Background:
The present dispute centres around Section 57 of the Copyright Act, 1957 under which the Plaintiff filed suit for interim injunction to restrain the respondents from releasing, publishing, distributing and exploiting the film and issuing pre-release publicity without providing adequate authorship credits to the plaintiff as per prevailing film industry standards. Section 57 of the Copyright Act, 1957 provides special rights to authors called Moral Rights that subsists with the author of the work over and above the economic rights of the creators of copyrighted. The Moral rights include the right to attribution, the right to have a work published anonymously or pseudonymously and the right to the integrity of the work. It provides for the preservation of the integrity of the work where actions prejudicial to the author’s honour and reputation are carried out by the copyright holders.
Facts of the Case:
In Sajeev Pillai v. Venu Kunnapalli and Ors, Sajeev Pillai is a film director and a scriptwriter who claimed to have researched the history of the grand festival of Mamankam; he prepared a script for a movie based on the same festival. History describes Mamankam as a grand festival held every twelve years on the banks of Nila River/Bharathapuzha at Thirunavaya between the 14 th to 19 th centuries. Mamankam mainly relates to the story of Perumal, the ruler of the region and chaver pada warriors (suicidal warriors). The Appellant Sajeev Pillai, met with Venu Kunnupalli, the first respondent, and signed an MOU with his production house, Kavya Film Company. Sajeev was initially appointed as the director of the said film Mamankam but his services were terminated and after certain differences. The Plaintiff contended that he has been researching on the history of this festival since the year 1999 and had written a script on it. He was the director of the film for two schedules and then he was terminated. The Respondents then completed the shooting of the said film without the Appellant. The Appellant alleged that the film was subsequently made by mutilating, distorting and modifying the script of the Plaintiff. The Respondents contended that the Plaintiff had sold his right of authorship for a consideration of Rs. 3, 00,000/- and therefore was not entitled to get any credit for the said film regarding script screenplay etc.
Judgment:
The Kerala High Court in the present case, referred to the relevant moral rights sections of the Copyright Act, 1957. Section 57 of the Copyright Act, 1957 states author’s special right. The High Court stated that, “What is enshrined in Section 57 (1) Independently of the author’s copyright and even after the assignment either wholly or partially of the said copyright, the author of a work shall have the right—
(a) to claim authorship of the work; and
(b) to restrain or claim damages in respect of any distortion, mutilation, modification or other act in relation to the said work which is done before the expiration of the term of copyright if such distortion, mutilation, modification or other act would be prejudicial to his honour or reputation: Provided that the author shall not have any right to restrain of claim damages in respect of any adaptation of a computer programme to which clause (aa) of sub-section (1) of section 52 applies.
Explanation. —Failure to display a work or to display it to the satisfaction of the author shall not be deemed to be an infringement of the rights conferred by this section.
(2) The right conferred upon an author of a work by sub-section (1), other than the right to claim authorship of the work, may be exercised by the legal representatives of the author.” The law is therefore clear that even after assignment, the author has legal right to protect his intellectual property. The plaintiff does have a strong prima facie case against the respondents, but moral rights cannot be overlooked in such circumstances. Assignment of the work by the plaintiff will not exhaust his legal right to claim authorship over it. But at the same time, it was not possible to ignore the fact that the shooting of the film had been completed and it was ready for release. As section 57 of the Copyright Act, 1957 envisages special rights for the author even after assignment of the Copyright of his original creation; such rights could only be granted after due examination of the film, and other evidence. From the above facts, it is clear that the author of the screenplay, script etc. of the said movie “Mamankam”, is the plaintiff and his right for his creation is safeguarded and protected by the Copyright Act, 1957. So, this gives protection and ensures the right of the author for his creation, even after assignment is maintained. Therefore, Plaintiff has authorship rights in the script of said film “Mamankam”.
Conclusion:
The Court did not stay the release of the film but granted such relief to the Appellant where no scriptwriter credits will be given to any person till the final decision rendered by the Trial Court.
by LFIAdmin | Nov 25, 2020 | Uncategorized
By Esha Malik, Advocate
eshamalik322@gmail.com | Nov 30, 2020
In a democratic country like India, Media Trials is and has always been a much discussed subject covering within its fold a very dramatic and impactful insight both in the print and electronic media. Today, with an alarming increase in the use of television and other electronic mediums, media plays a very important role in as much as shaping the guilt of accused, witnesses and suspects without having felt the need for a fair trial. Therefore, excessive publications of any crime, victim, witnesses, suspects or accused by media resulting into a prejudicial impact on the character of such a victim, witness, suspects or accused amounts to negative publicity. As held by the Supreme Court and House of Lords, such a widespread and strong publicity declaring the guilt of the accused without having gone through a fair trial may also sub-consciously affect the judge on the basis of what he hears or sees outside the court ultimately affecting the trial when it takes place later resulting in deprivation of the individual’s rights to a fair and impartial trial. In that very sense, what it actually does is it dupes its viewers and/or common public to adjudicate the guilt of the accused even before the commencement of a trial which later even if the accused is acquitted and not proven guilty, can have a very great impact on his personal and professional life. Constant excessive coverage, publication of sensitive contents, TV debates of imminent and sub-judice matters greatly interfere with the administration of justice and in capturing the minds of the common public to believe that version as the sole truth under the garb of Freedom of Press.
The power of media is well enunciated in Article 19(1)(a) of the Constitution of India which guarantees freedom of speech and expression, however, at the same time imposes certain reasonable restrictions under Article 19(2) as the media cannot be permitted to have an unregulated and unrestricted freedom amounting to seriously prejudice the rights of the accused having been declared guilty otherwise than by the procedure established in law. Every person is entitled to a right of fair trial and more particularly, Article 21 of the Constitution ensures that no person shall be deprived of his life or personal liberty except according to the procedure established by law.
Generally, media having a very strong force on the minds of people, begins its independent investigations covering the crime and in doing so, creates doubtful reservations in the minds of public weakening the coherent and structured official investigation machinery. In fact, it goes to the extent of interviewing the potential witnesses and following them at all times to compel them to give certain crucial information or names relating to the commission of the crime and therefore, coming to various biased conclusions declaring the guilt of the suspects, witnesses or accused resulting into parallel investigations and parallel trials by Media. However, to ensure the proper conduct of media, the Press Council of India from time to time issues guidelines governing and controlling their conduct which is often not adhered to by them.
With such an increasing and alarming interference of the media in administration of justice, the law regulating the publications of crime or accused or suspects by media have to be well regulated. Section 2 of Contempt of Courts Act, 1971 defines Criminal Contempt. Interestingly, Section 3 of the said Act grants complete immunity to the publisher and in granting such an immunity, much is stressed upon the word “pendency of judicial proceedings” at the date of publication in any court of law. The word “pendency” is explained in the Explanation to section 3 which includes in the case of a civil proceeding, when it is instituted by the filing of a plaint or otherwise and in the case of a criminal offence, the date when the charge sheet or challan is filed after the investigation, or when the court issues summons or warrant against the accused. This clearly means that any prejudicial publication in whatever form published before the date of filing of the charge sheet or challan or issuance of summons or warrant by the Court against the accused will not constitute contempt as per the provision of the said Act. Several other countries including the UK Contempt of Courts Act, 1981 differs with this proposition and in turn has held the date of “arrest” as the starting point of commission of contempt in case of prejudicial publications. The Law Commission of India in its 200th Report on “Trial By Media” has also recommended the date of arrest as the starting point under section 3 of the Contempt of Courts Act, 1971 and not the date of filing of charge sheet after the investigation. Recently, after the excessive media coverage on the death of Actor Sushant Singh Rajput case, Bombay High Court has issued Notice to the Central Government seeking interpretation of Section 3 of Contempt of Courts Act, 1971 in a PIL seeking judicial intervention as to the starting point of contempt being the date of filing of the FIR and not the date of charge sheet at the end of the investigation and also seeking directions of fair reporting by Media in Sushant Singh Rajput Death Case, the said matter is sub-judice. During the several hearings of the PIL, much is stressed upon the issuance of proper guidelines and that such guidelines must be strictly complied with. The Bombay High Court also expressed its concern and categorically stated that “Media should not report in a manner which hampers the on-going investigation in the matter”.
The power of the courts to restraint and postponement in cases of prejudicial publications has been settled by the top Court in Sahara v/s. SEBI popularly known as “Media Guidelines Case” laying the doctrine of postponement and having recognised the power of the Supreme Court and the High Courts in issuing postponement order delaying publication of any judicial proceedings for a certain period of time. In yet another judgement in the year 2012, the Constitution Bench of Supreme Court, while imposing “Lakshman Rekha Guidelines” on media reporting relied on a catena of judgements from foreign countries like United States of America, England, Canada, Germany, Australia and New Zealand along with the judgements of Indian Courts to arrive at a conclusion that postponement of publication of court proceedings in certain cases was necessary to strengthen the balance between Article 21 and Article 19(1)(a) of the Constitution.
It is now very unfortunate that the Media Trials is becoming very common and also that certain authorities are delivering judgements on the basis of such Media Trials. A very classic example of this would be a recent judgement of the Hon’ble High Court of Madhya Pradesh, Bench at Indore wherein the Division bench was pleased to quash the impugned detention Order of the Petitioner’s father who was detained in the Indore Central Jail by the District Magistrate on the ground of total non-application of mind as the impugned order was delivered on the basis of media trials. The District Magistrate had formed its opinion on the basis of news published in Nai Duniya, Dainik Bhaskar, People’s Samachar and therefore was erroneous and suffered from total non-application of mind and accordingly the Madhya Pradesh High Court quashed the same.
CONCLUSION:-
To conclude, the media is a very powerful and an important tool in the democratic India. Freedom of speech and expression as guaranteed under the Constitution is its very essence however, such a freedom must not be unregulated or uncontrolled as a large population of this country is dependent on Media and its legal awareness. Media is constantly under a conscious responsibility in shaping the opinions of the common public and establishing confidence in the legal machinery and justice delivery system. Therefore, excessive publications of crime and sensitive criminal matters, independent investigations, suspecting individuals on the basis of such independent investigations, interviewing potential witnesses and constant follow ups interfere with the administration of justice and demolish the confidence of the general public in law ultimately resulting in a biased and unfair trial.
by LFIAdmin | Nov 25, 2020 | Uncategorized
By Punit Agarwwal, Final Year Student at Jindal Global Law School
16jgls-pmagarwwal@jgu.edu.in | Nov 30, 2020
In these unfortunate times of the Coronavirus pandemic, several state governments have passed notifications to increase workers’ working hours to twelve hours a day [1]. The Labour Ministry is all set to pass rules like the Code on Occupational Safety, Health and Working Conditions (OSH & WC) by January 2021 [2], which allow the extension of working hours of a worker to twelve hours a day, i.e., 72 hours a week. This allowance in the extension of working hours has increased the employers’ scope of exploitation. The employers might exploit the workers to increase productivity to fight the recession or make up for the losses made in the lockdown period. There might be instances where the employer might make some alterations to the weekly holidays, therefore the judgment John Douglas Keith Brown v State of West Bengal read with section 2, 52 and 92 of the Factories Act, 1948 becomes very important. In the year 1964, Justice J.R. Mudholkar, Supreme Court of India, delivered this judgment. The judgment ensures that both the occupier and the manager are held accountable if they fail to comply with Section 52 of the Act. Section 52 indicates a prohibition from requiring or allowing an adult worker to work in a factory on the first day of the week. The prohibition is, however, lifted if the steps under clauses (a) and (b) of that section are taken. The section also prohibits any substitution that results in any worker working for more than ten days consecutively without weekly holidays.
FACTS OF THE CASE
Mr. John Douglas Keith, the appellant, was the Managing Director of Jardine Henderson Ltd., who were the managing agents of the Howrah Mills Company. He was by virtue of his position in the company termed as ‘occupiers’ of the Mill as per the definition under section 2(n) of the Act. On the other hand, Mr. J.P. Bell was the manager of the Mill.
Both John and J.P. Bell were charged with the penalty under section 92 of the Factories Act for contravening the provisions under section 52. However, while the trial was pending in the Sub-Divisional Magistrate’s court, the manager, Mr. Bell, was allowed to go to England. The trial was continued only against the appellant alone. The appellant was then convicted of the offense and sentenced to a fine by the Sub-Divisional Magistrate. The appellant then appealed—both the Sessions Court and the High Court dismissed his appeals. However, the High Court allowed him to appeal to the Supreme Court, deeming the case fit for appeal to the Supreme Court.
APPELLANT’S ARGUMENTS
The appellant made all his arguments by relying on the State Govt. of Madhya Pradesh vs. Maganbhai Dasaibhai case.
Firstly, he argued that the High Court at Nagpur in the Maganbhai case held that –
“An occupier will be liable for a contravention of any of the provisions of the Act or rules if the responsibility for observing the provisions has not been imposed on some other person. If a specific duty is laid on a particular person, the responsibility for the breach will be his. [3]”
Therefore, on the same lines, the appellant stated that Section 52(1)(b) imposes a duty on the manager to give notice to the Office of the Inspector in case a change in weekly holidays is proposed from the first day of the week to any other substituted day. Therefore, the manager’s omission to provide such notice cannot render the occupier liable for penalty under section 92, as the duty was not laid on him by the section.
Secondly, the appellant furthered his above argument by stating that the occupier cannot be held liable for penalty unless shown with evidence that the occupier had any connivance on his part for the manager’s breach or if the occupier had the mens rea to contravene the provision. The Maganbhai case emphasized the necessity of mens rea under section 92 because it is a penal statute, and “Penal statutes have to be strictly construed. It is a cardinal principle of criminal law that unless the statute, either clearly or by necessary implication, rules out ‘mens rea’ as a constituent part of a crime, an accused should not be found guilty of an offense against the criminal law unless he has got a guilty mind. [4]”. Therefore, he stated that because there was no evidence to prove that he was aware of the manager’s omission, his sentence and conviction should be quashed by the court.
COURT’S DECISION
The court, on perusal of clause (b) of section 52(1), held that the requirement to give and display the notice under the clause is only to secure an exemption from the prohibition which the opening part of section 52(1) puts. This requirement should not be equated to the other provisions that put a specific duty on the manager. The clause and the prohibition under the section should be construed in a general sense and should not be confined to the manager only. Thus, meaning that in contravention of section 52(1), both the occupier and the manager will be held liable to the penalties prescribed under the section. Since section 52 does not specify specific penalties under it, section 92 will be applicable.
Secondly, the court also highlighted the evidence to prove that the occupier (appellant) had the knowledge of a violation of section 52(1) and that he did not take any steps to stop the same. The court found two letters sent to the Chief Inspector of Factories by the manager, the copies of both the letters were also sent to the M/s Jardine Henderson Ltd. The fact that the appellant was the Managing Director of M/s Jardine Henderson Ltd., it is deemed that the appellant knew of what was going on and what the manager proposed to do. However, even then, the appellant did not bother to restrain the manager from putting the new schedule in operation without permission. This schedule was itself in violation of the opening line of section 52 since the manager proposed to schedule the working hours on Sundays. The schedule also did not specifically mention the names of the respective workers to work in that shift. Therefore, the court also clarified that section 52 does not grant general permission to alter the weekly holidays for all workmen; instead, it only allows an exception for some workmen.
Therefore, the appellant’s arguments were not accepted, and the Supreme Court held that both the manager and the appellant were liable for the contravention of section 52 as the occupier had the full knowledge of the conduct of the manager. Thus, the appeal was dismissed.
COMMENTS
Section 52 is an essential part of the Factories Act, 1948. It furthers its objective and purpose by preventing the workers from being exploited and subjected to inhuman treatment in terms of working schedule and hours. It ensures that the workers are given appropriate intervals between working days, like prohibiting a worker’s substitution if he has not been given weekly holidays after working for ten days consecutively. This judgment demonstrates how the Supreme Court also furthers this objective of the legislation by holding both the occupier and the manager liable to penalty under section 92 for any violations of section 52. It makes sure that the occupier does not escape his accountability by claiming that he lacked knowledge of his manager’s conduct with evidence proving otherwise. Thus, ensuring the compliance of the provisions of this Act by both the parties.
The Supreme Court has also, by dismissing the appeal, upheld the Sub-Divisional Magistrate’s decision to hold only the ‘occupier’ of the factory liable. Thus, practically approving the continuation of the prosecution in the absence of the Manager and laying down the principle that under section 92, it is not necessary to have the prosecution proceed or filed against both the manager and the occupier when invoking section 92. The State of Maharashtra vs. V.S. Raghavan case discusses the same principle. The Bombay High Court, in this case, cited the present case while arriving at its decision to hold that “If the prosecution feels that the responsibility lies for the breach only one the Manager, the prosecution u/s 92 can proceed only against the Manager and it cannot be said that even in such event the occupier should also be made accused…merely because if the provisions of Section 92 are construed to mean that a joint prosecution is contemplated in each and every case and neither the occupier nor the Manager can singly be prosecuted. The principle of vicarious liability is negatived. [5]” Therefore, the current position of law is that an occupier will be held liable under section 92 for contravening section 52 if there is evidence that proves that he knew of the contravention. Otherwise, the prosecution can also file individual prosecutions under section 92. Also, section 52 does not grant a general permission to alter the weekly holidays for all workmen; instead, it only allows an exception for some workmen.
[1] https://www.business-standard.com/article/current-affairs/covid-19-how-a-12-hour-shift-for-labourers-will-impact-their-lives-120042700687_1.html
[2]https://www.businesstoday.in/current/economy-politics/labour-ministry-readies-draft-notification-allowing-12-working-hours-a-day/story/422534.html
[3] State Govt.,Madhya Pradesh vs. Maganbhai Dasaibhai (25.04.1952 – NAGPUR) : MANU/NA/0165/1952
[4] State Govt.,Madhya Pradesh vs. Maganbhai Dasaibhai (25.04.1952 – NAGPUR) : MANU/NA/0165/1952
[5] State of Maharashtra vs. V.S. Raghavan (17.11.1988 – BOMHC) MANU/MH/0297/1988
John Douglas Keith Brown v State of West Bengal MANU/SC/0216/1964
