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2022 (1) TMI 1433 - SUPREME COURT
Civil suit - limited jurisdiction exercised by High Court - It is the appellant’s case that due to the detention, the appellant was prevented from effectively contesting and participating in the civil suit - Whether the High Court was justified and correct in law and on facts in exercising powers under Article 227 of the Constitution of India to set aside the order allowing the application under Order IX Rule 13 of the Code of Civil Procedure, 1908 filed by Shailendra Garg, sole proprietor of M/s Garment Craft?
HELD THAT:- The impugned order is contrary to law and cannot be sustained for several reasons, but primarily for deviation from the limited jurisdiction exercised by the High Court under Article 227 of the Constitution of India. The High Court exercising supervisory jurisdiction does not act as a court of first appeal to reappreciate, reweigh the evidence or facts upon which the determination under challenge is based. Supervisory jurisdiction is not to correct every error of fact or even a legal flaw when the final finding is justified or can be supported. The High Court is not to substitute its own decision on facts and conclusion, for that of the inferior court or tribunal.
The jurisdiction exercised is in the nature of correctional jurisdiction to set right grave dereliction of duty or flagrant abuse, violation of fundamental principles of law or justice. The power under Article 227 is exercised sparingly in appropriate cases, like when there is no evidence at all to justify, or the finding is so perverse that no reasonable person can possibly come to such a conclusion that the court or tribunal has come to. It is axiomatic that such discretionary relief must be exercised to ensure there is no miscarriage of justice.
The factum that the counsel for the appellant had applied for the certified copy would show that the counsel for the appellant was aware that the ex-parte decree had been passed on the account of failure to lead defence evidence. This would not, however, be a good ground and reason to set aside and substitute the opinion formed by the trial court that the appellant being incarcerated was unable to lead evidence and another chance should be given to the appellant to lead defence evidence. The discretion exercised by the trial court in granting relief, did not suffer from an error apparent on the face of the record or was not a finding so perverse that it was unsupported by evidence to justify it.
The impugned order dated 4th July 2019 is set aside - the order dated 24th July 2018 passed by the Additional District Judge, (Central), Tis Hazari, Delhi, is restored allowing the application under Order IX Rule 13 of the Code and setting aside ex-parte decree and the judgment dated 8th November 2016 - Appeal allowed.
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2022 (1) TMI 1432 - MADHYA PRADESH HIGH COURT
Murder - singular charge under Section 307/149 of IPC was framed for attempting to kill Bhanupratap Singh and Ajab Singh, instead of framing charges on two counts - HELD THAT:- The evidence which was led in the Trial of co-accused Dilip cannot be read in favor of the Appellant Surajbhan. Further, on 6-12-2018 and 16-4-2018, Bhanupratap Singh (P.W.1) and Ajab Singh (P.W.2) respectively, were being examined for co-accused Dilip only and not for the Appellant Surajbhan. Therefore, the Appellant Surajbhan would not get benefit of any word uttered by Bhanupratap Singh (P.W.1) and Ajab Singh (P.W.2) in their examination on 6-12- 2018 and 16-4-2018 respectively.
However, it is surprising, that although the Appellant Surajbhan Singh was being tried for offence under Section 302/149 of IPC for committing murder of Pahalwan and Darshan Singh, but the Trial Court, without giving any finding in respect of murder of Darshan Singh, convicted him only for the murder of Pahalwan - the Trial Court has passed an incomplete judgment.
Since, no appeal has been filed by the State in this regard, then whether this Court is helpless or can remand the matter for writing a judgment in respect of charge under Section 302/149 of IPC which was framed for murder of Darshan Singh as well as in respect of charge under Section 307/149 of IPC which was framed for making an attempt to kill Ajab Singh (P.W.2)? - HELD THAT:- Although no appeal has been filed by the State, but this Court is not reversing the judgment passed by the Trial Court. It is merely found that the judgment passed by the Trial Court is incomplete - In the present scenario, this Court cannot issue notice to the Appellant for enhancement of sentence as no sentence has been awarded by the Trial Court on above mentioned two charges. Further, this Court cannot remand the matter for re-trial, as no procedural lapse has been committed by the Trial Court, but only an incomplete judgment has been passed.
The appeal is continuation of Trial. An appeal thus is a rehearing of the main matter and the appellate court can reappraise, reappreciate and review the entire evidence—oral as well as documentary—and can come to its own conclusion. Therefore, this Court is of the considered opinion, that even in absence of any appeal by State, this Court in exercise of powers under Section 482 of Cr.P.C., can remand the matter for writing the judgment in respect of charge under Section 302/149 of IPC for murder of Darshan Singh and under Section 307/149 for making an attempt on the life of Ajab Singh (P.W.2) also, which was erroneously left by the Trial Court.
Appeal disposed off.
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2022 (1) TMI 1431 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL, NEW DELHI - LB
Approval of Resolution plan - the plan has no statement explaining how the Resolution Plan satisfies or intends to satisfy the requirements of engaging in the business of the FSP - HELD THAT:- The relationship between the customer and the Bank is the creditor and debtor and not a trustee. The Bank is not a trustee of money deposited by customers. In this case, the Corporate Debtor, i.e. DHFL, took a fixed deposit from their customers on the agreed interest on the amount invested in fixed deposits. Therefore, the relationship of the DHFL with the fixed deposit holders is that of a creditor and debtor and not of a trustee.
Hon'ble Supreme Court in the Committee of Creditors of Essar steel v Satish Kumar Gupta and others [2019 (11) TMI 731 - SUPREME COURT] has reinforced the position that the COC is the key decision-maker in the rehabilitation of Corporate Debtors. For the approval of the Resolution Plan, the Committee of Creditors is to take a business decision based on ground realities by a majority, which binds all the stakeholders, including dissentient creditors. The Adjudicating Authority cannot interfere on merits with the commercial decision taken by the Committee of Creditors.
It is the commercial wisdom of the requisite majority of the Committee of Creditors which is to negotiate and accept the Resolution Plan, which may involve differential payment in different classes of creditors, together with negotiating with the prospective Resolution Applicant for better or different terms which may also involve differences in the distribution of amounts between the different classes of creditors.
Having participated in the CIRP, the Appellant's cannot challenge the action of the COC to approve the Resolution Plan, which is otherwise in compliance with the provisions of the IBC - By seeking payment outside the resolution process, the appellants who are also CoC members (other CoC members being banks, etc. are acting in a silo for obtaining funds at the outset, which is not only against the interest of all the stakeholders but also against a holistic resolution for maximisation of value & distribution of funds between different classes of creditors.
It is important to mention that the RBI Act and the NHB Act merely provides that the license of an HFC or NBFC may be cancelled if the deposit holders are not paid. Such a decision can be taken only after allowing the concerned HFC or NBFC to present its case. None of the legislation provides that FD holders are required to be paid in full. Therefore, it is not the case of the Appellant's that RBI is not empowered to act under the RBI Act or the FSP Rules. The Appellants acknowledges that statutory mandate made available to the RBI under the RBI Act and the FSP rules.
In the instant case, the RBI's exercise of its administrative discretion under Section 45-IE of the RBI Act superseded the board of DHFL and appointed Administrator. Accordingly, it decided to initiate the resolution proceedings concerning DHFL under the IBC and not the RBI Act - The RBI Act and the NHB Act merely provides that the license of an HFC or NBFC may be cancelled if the deposit holders are not paid. Such a decision can be taken only after allowing the concerned HFC or NBFC to present its case. None of the legislation provides that FD holders are required to be paid in full. Therefore, it is not the case of the Appellant's that RBI is not empowered to act under the RBI Act or the FSP Rules. It therefore, in the circumstances Section, 238 of the IB Code does not override any requirement of law governing the actions of the DHFL must be followed.
Thus, it is clear that NCLT or NCLAT have been endowed with limited jurisdiction as specified under the Code and cannot act as a court of equity or exercise plenary powers. Therefore, the fixed deposits of the Appellant's made from the lifetime earnings of the employees invested by the Provident Fund Trust with the Corporate Debtor, i.e. Financial Service Providers, is of no consequence. Accordingly, it can not be a condition authorising interference with the commercial wisdom of the CoC.
The impugned Order regarding the payment to the Appellants against their FD's as per the approved Resolution Plan with the requisite majority as required under law needs no interference, and both the appeals deserve to be dismissed - Appeal dismissed.
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2022 (1) TMI 1430 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL, NEW DELHI
Challenge to Resolution Plan approved by the Adjudicating Authority - distribution mechanism under IBC - Appellants' main grievance is that the approved resolution plan has equated the Appellants who are fixed deposit holders (FD Holders) with other financial institutions/creditors and in contravention of the National Housing Bank Act (NHB Act) and Reserve Bank of India Act (RBI Act) have been given the biggest haircut under the Resolution Plan.
HELD THAT:- FD Holders have not filed any documents to show that amount deposited by the FD Holder was assets held in trust. Therefore, there is no legal justification whatsoever given by the Appellant/F.D. Holder to show that the money deposited by them was held in trust by DHFL and the amount held by DHFL were not assets of DHFL. Thus, Rule 10 of FSP Rules is inapplicable about the amount deposited by FD Holders.
It is well-established law that when two special statutes contain a non-obstante clause, the latter will prevail over the earlier statute. In case of any inconsistency between the provision of the Code and any other enactment, the provision of the Code will prevail. Therefore, provisions of the Insolvency and Bankruptcy Code enacted later will have overriding effect over the NHB Act and the RBI Act by the non-obstante clause.
In the case of M/S. INNOVENTIVE INDUSTRIES LTD. VERSUS ICICI BANK & ANR. [2017 (9) TMI 58 - SUPREME COURT], the Hon'ble Supreme Court has held that in case of any inconsistency between the provisions of Code and any other law, the provisions of the Code shall prevail. Therefore, Insolvency & Bankruptcy Code which was enacted later, will override the NHB Act and RBI Act by the non-obstante clause of Section 238 of the Code.
It is clear that the relationship between the customer and the Bank is the creditor and debtor and not a trustee. The Bank is not a trustee of money deposited by customers. In this case, the Corporate Debtor, i.e. DHFL, took a fixed deposit from their customers on the agreed interest on the amount invested in fixed deposits. Therefore, the relationship of the DHFL with the fixed deposit holders is that of a creditor and debtor and not of a trustee. The money so deposited becomes a part of the DHFL's funds which is under a contractual obligation to pay the sum deposited by a customer to him and on maturity or as per the terms of the contract they were getting agreed rate of interest. Such a relationship between the DHFL & the fixed deposit holders is one of the creditor and debtor and not of a trustee."
Hon'ble Supreme Court in the COMMITTEE OF CREDITORS OF ESSAR STEEL INDIA LIMITED THROUGH AUTHORISED SIGNATORY VERSUS SATISH KUMAR GUPTA & OTHERS [2019 (11) TMI 731 - SUPREME COURT] has reinforced the position that the COC is the key decision-maker in the rehabilitation of Corporate Debtors. For the approval of the Resolution Plan, the Committee of Creditors is to take a business decision based on ground realities by a majority, which binds all the stakeholders, including dissenting creditors. The Adjudicating Authority cannot interfere on merits with the commercial decision taken by the Committee of Creditors.
Having participated in the CIRP, the Appellant's cannot challenge the action of the COC to approve the Resolution Plan, which is otherwise in compliance with the provisions of the IBC - Further, there is no rationale for treating the deposit holders as separate classes and providing them preferential treatment. IBC already contains various safeguards for the public deposit holders, including an Authorised Representative who can effectively represent that class of creditors.
It is important to mention that the RBI Act and the NHB Act merely provides that the license of an HFC or NBFC may be cancelled if the deposit holders are not paid. Such a decision can be taken only after allowing the concerned HFC or NBFC to present its case.
In the instant case, the RBI, in the exercise of its administrative discretion under Section 45-IE of the RBI Act, superseded the board of DHFL and appointed administrator. Accordingly, it decided to initiate the resolution proceedings with respect to DHFL under the IBC and not the RBI Act. Appellant's contention is mainly about the obligation of the administrator and the successor in the interest of the DHFL to ensure full repayment of deposit to have FD holders under the RBI and NHB act. It is further contended that there is no inconsistency between the provisions of the IBC and other provisions of law requiring repayment to deposit holders as per the terms and conditions of the deposit.
The RBI Act and the NHB Act merely provides that the license of an HFC or NBFC may be cancelled if the deposit holders are not paid. Such a decision can be taken only after allowing the concerned Housing Finance Company or NBFC to present its case. None of the legislation provides that FD holders are required to be paid in full. Therefore, it is not the case of the Appellant's that RBI is not empowered to act under the RBI Act or the FSP Rules.
Undisputedly the corporate debtor DHFL defaulted in making its payment obligations; therefore, RBI as a regulator itself stepped in and initiated insolvency proceedings of the erstwhile corporate debtor under the IBC read with FSP rules. It is a settled position of law that once a company is admitted into Insolvency, the IBC is a complete and exhaustive code that governs the entire process - The NHB and RBI Act operate in ordinary circumstances when a company is not undergoing Insolvency. As such, creditors of the Company under Insolvency cannot seek to enforce the NHB Act and RBI act provisions. In any event, it is amply clear that neither the provisions of the NHB Act nor the RBI act guarantees full repayment of deposits.
The impugned Order regarding the Payment to the Appellants against their FD's as per the approved resolution plan with the requisite majority as required under law needs no interference - appeal dismissed.
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2022 (1) TMI 1429 - SC ORDER
Claim filed by Operational Creditors belatedly, rejected - CIRP is now at the stage where the Resolution Plan has already been approved by the Committee of Creditors and the same has been filed before the Adjudicating Authority for approval - it was held by NCLAT that keeping in view the object of the ‘I&B Code’ which is Resolution of the Corporate Debtor in time bound manner to maximize value, if such requests of applicants like Appellant are accepted the purpose of ‘I&B Code’ would be defeated - HELD THAT:- There are no reason to interfere with the impugned order - appeal dismissed.
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2022 (1) TMI 1428 - MADRAS HIGH COURT
Maintainability of petition under Section 482 Cr.P.C. - Money Laundering - scheduled offence - scope of judicial review - registration of an ECIR by the officers of the Enforcement Directorate - HELD THAT:- The registration of an ECIR is an administrative act that is done by the officers of the Enforcement Directorate, for initiation of an investigation under the PML Act, which is a special statute and therefore, the same cannot be quashed, in exercise of the powers under Section 482 Cr.P.C., because, the registration of the ECIR is not under the Code.
The scope of Section 482 Cr.P.C. has been succinctly laid down by a Division Bench of this Court in K. RAJAMANICKAM AND ORS. VERSUS STATE OF TAMIL NADU AND ORS. [1991 (1) TMI 466 - MADRAS HIGH COURT] which says that The first part or the first clause, understood as above, conveys that the inherent power of the High Court can come into play when it is necessary to give effect to any order under the Code, if there is no express bar and if there is no other provision of the Act to ensure the implementation of the order. The second part or the clause will be available if in any proceeding of a Court, whether the High Court or a Court subordinate to it, any abuse of process is found or otherwise it is felt that to secure the ends of justice certain order of the High Court is necessary; it may act thus to prevent the abuse of process of any Court or otherwise to secure the ends of justice.
Thus, viewed from any angle, the registration of an ECIR by the officers of the Enforcement Directorate, cannot be a subject matter of judicial review under Section 482 Cr.P.C.
The objection raised by the Registry is upheld and this petition stands dismissed as not maintainable at the SR stage itself.
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2022 (1) TMI 1427 - JHARKHAND HIGH COURT
Seeking grant of bail - Money Laundering - embezzlement of more than Rs.18 crores and also of money laundering - misuse of liberty of jail in other cases or not - HELD THAT:- Keeping in view the gravity of the offence and the offence alleged is economic offence, which ultimately damages the national economy, the bail application of the applicant is deserved to be rejected.
The prayer for bail of the applicant is hereby rejected.
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2022 (1) TMI 1426 - GUJARAT HIGH COURT
Refund of amounts collected from the petitioners as stamp duty on Bills of Entry filed for the goods imported - HELD THAT:- There is no escape for the State from the fact that it could not have insisted or compelled the writ-applicants to deposit an amount of Rs. 2,48,45,110/- towards the stamp duty - It appears from the materials on record, more particularly, from page-71 onward that all the delivery orders are in the nature of bill of entry.
The respondents nos. 1, 2 and 3 respectively are directed to refund the amount of Rs. 2,48,45,110=00 collected by way of stamp duty from the writ-applicants with 9% interest per annum for the period when the amount was collected till the actual refund of the same.
Application allowed.
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2022 (1) TMI 1425 - ITAT KOLKATA
Maintainability of appeal against Revision order u/s 263 - DR objected to the assessee’s filing the appeal directly to the Tribunal against the AO’s action giving effect to the 263 order passed by the Ld. Pr. CIT - according to Ld. CIT DR, the appeal of the assessee is invalid and the Tribunal does not have the jurisdiction to hear the appeal of the assessee even though revised Form No 36 has been filed by the assessee - HELD THAT:- We note that the assessee was the same who appeared on behalf of the appellant in the case of M/s. Good point Stockist Pvt. Ltd. (2021 (8) TMI 1411 - ITAT KOLKATA] and the facts of the present case are similar/identical in nature as that of M/s. Good point Stockist Pvt. Ltd. (supra) where the Tribunal was pleased to allow the assessee to withdraw the appeal and had given liberty to file fresh appeal against the action of the Ld. PCIT-4, Kolkata. The Tribunal was also pleased to condone the time consumed in prosecuting the appeal i.e. from the date of filing of the present appeal till receiving the copy of the Tribunal order and the period not to be taken into consideration for the purpose of calculating the limitation period. With the aforesaid same observation we allow the assessee to withdraw the appeal. Appeal of the assessee is allowed.
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2022 (1) TMI 1424 - ITAT DELHI
Addition under the head "capital gains" from sale of equity shares held by the assessee - FMV determination - value of leasehold interest in land - residual ownership rights were transferred in favour of person (who was the state subject i.e. resident of Jammu & Kashmir) - whether the value of leasehold interest in the land is to be included to determine the fair market value of each share on 1.4.1981? HELD THAT:- Assessee‟s were shareholders of M/s Jyoti (P) Ltd., who undisputedly owned the hotel building which stood on the land owned by Shri Vikramaditya Singh one of the shareholder, who had become the owner of the land by virtue of the partition of the family properties and the land falling to his share had in fact been leased out by him to the company, M/s Jyoti (P)Ltd.
We find force in the arguments of assessee that since in the state of Jammu and Kashmir no person other than the resident of the state can own the land, the title to the land stood in the name of Shri Vikramditya Singh and even the Hotel Building would have no independent value, if the land on which the building stood is not considered.
We find from deed of lease dt. 21.3.1973 that at the time when M/s Jyoti P. Ltd., had purchased the building by another deed of relinquishment on 21.3.1973, the Hotel Building was already existing on the land so leased and as such virtually it was a case where M/s Jyoti P. Ltd., had an absolute interest despite the fact it was only where the title of the land remained in the name of Shri Vikramaditya Singh. We find even the residual ownership rights were transferred in favour of Sh. Narendra Batra (who was the state subject i.e. resident of Jammu & Kashmir), who was a nominee of Bharat Hotels Ltd. on 16.1.1998 for a nominal value of Rs. 10 lacs when Perpetual Lease Deed was granted in favour of M/s Jyoti (P) Ltd.
We, therefore, find merit in the arguments of assessee that virtually Shri Vikramditya Singh had divested his rights title and interest in respect of the aforesaid land as early as from 21.3.1973 and for all practical purposes the land was considered to be the property of the company. Since under the state laws of Jammu and Kashmir any immovable property could not be owned by a person who is not a resident, only title of the property remained in the name of Shri Vikramaditya Singh. It is true that, lessee had only disclosed the value of the building in its Balance Sheet, despite the fact that it had also acquired and held lease hold rights. We find as on 1.4.1981 un-expired period of lease was 32 years as the lease granted was to expire only on 20.3.2013.
In order to determine the fair market value of each share as on 01.04.1981, it is necessary to adopt the aggregate of fair market value of the assets which would obviously include the value of leasehold interest in the land. In CWT vs. PN Sikand reported in [1977 (4) TMI 1 - SUPREME COURT] had held that an asset also consists of leasehold interest in a land and should be included in the valuation of such leasehold interest in the land. Similar view has also been taken in the decisions relied on by Ld. Sr. Counsel for the assessee in the case law compilation.
Thus we hold that while adopting the fair market value as on 01.04.1981, the value of leasehold interest in the land be also held to be included in the value of asset of M/s Jyoti Private Limited, so as to determine the fair market value of shares held by the sharesholders. The lease hold interest in the land is an asset of company and is capable of valuation. That the assessee had made no capital gain and the method of valuation adopted under the Wealth Tax Act is not applicable, while arriving at the fair market value of shares as on 01.04.1981 for the purpose of section 55(2)(b)(ii) of the Act. The various decision relied on by Ld. Special Counsel for the Revenue are distinguishable and not applicable to the present case. Accordingly, the order of the Ld. CIT(A) on this issue is upheld and the grounds raised by the Revenue on this issue of Capital Gain are dismissed.
Characterization of income - correct head of income - agricultural income or income from other sources - assessee could not substantiate its agricultural income and the assessee was not showing any agricultural income in the past years - CIT(A) deleted addition - HELD THAT:- The assessee before the Assessing Officer as well as the Ld. CIT(A) had filed the details of agriculture produce and the details of sale etc. It is also submitted before the Ld. CIT(A) that the apple and Cherry trees which were planted before three four years earlier had started giving fruits during the year and therefore the assessee has shown agricultural income from this year. Merely because the assessee had not shown agricultural income in the past, in our opinion, cannot be a ground for rejecting the claim of agricultural income during the impugned year especially when the assessee had filed the details of agricultural land and the receipts of the buyers who had purchased the apple and cherry. We, therefore, uphold the order of the ld. CIT(A) on this issue and the ground raised by the Revenue on this issue is dismissed.
Validity of reassessment proceedings - income declared by the assessee in the invalid return has escaped assessment in terms of section 147 - HELD THAT:- Since, such income has already been offered to tax and due taxes have already been paid, therefore, pre-requisite before the issuance of notice of escapement of income on 10.01.2001 being not satisfied, assumption of jurisdiction u/s 148 of the Act and consequent assessment order passed in our opinion is unsustainable in law especially when there was time available with the AO to complete the assessment u/s 143(3)/144 upto 31.03.2001. Further, the Assessing Officer in the order passed u/s 143/147 of the Act has brought to tax a sum by way of capital gain which was not the ground of reopening of the assessment. Therefore, we agree with the contention of the ld. Sr. Counsel for the assessee that such addition made in the assessment order is unsustainable in law in view of the decision of Ranbaxy Laboratories Ltd. [2011 (6) TMI 4 - DELHI HIGH COURT] and Jet Airways (I) Ltd. [2010 (4) TMI 431 - HIGH COURT OF BOMBAY]
Reopening of the assessment in the case of Dr. Karan Singh and other two assessees - We find the proceedings u/s 148 of the Act was initiated after a period of four years from the end of the relevant assessment year. The entire basis on which the proceedings had been initiated u/s 147 of the Act in the case of the three assessees was on the basis of the findings recorded by the A.O. in the order of assessment dated 26.03.2002 in the case of Mr. M.K. Ajat Shatru Singh, such findings had ceased to remain valid findings when the learned CIT(A) had held that no gain had accrued to the assessees. Therefore, such reopening of assessment after the order of the Ld. CIT(A) holding that no gain had accrued to the assessees in our opinion makes the reassessment proceedings unsustainable in law since the foundation on which the structure was proposed did not exist.
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2022 (1) TMI 1423 - SUPREME COURT
Revisional jurisdiction Under Section 401 Code of Criminal Procedure - setting aside the order of acquittal - conviction of the Accused - non-availment of remedy of right of appeal against the order of acquittal - exercise of powers Under Sub-section (5) of Section 401 Code of Criminal Procedure treating the revision application as petition of appeal.
Whether the High Court in exercise of the revisional jurisdiction Under Section 401 Code of Criminal Procedure is justified in setting aside the order of acquittal and convicting the Accused by converting the finding of acquittal into one of conviction? - HELD THAT:- On a plain reading of Sub-section (3) of Section 401 Code of Criminal Procedure, it has to be held that Sub-section (3) of Section 401 Code of Criminal Procedure prohibits/bars the High Court to convert a finding of acquittal into one of conviction. Though and as observed hereinabove, the High Court has revisional power to examine whether there is manifest error of law or procedure etc., however, after giving its own findings on the findings recorded by the court acquitting the Accused and after setting aside the order of acquittal, the High Court has to remit the matter to the trial Court and/or the first appellate Court, as the case may be - in the present case, the High Court has erred in quashing and setting aside the order of acquittal and reversing and/or converting a finding of acquittal into one of conviction and consequently convicted the Accused, while exercising the powers Under Section 401 Code of Criminal Procedure. The order of conviction by the High Court, while exercising the revisional jurisdiction Under Section 401 Code of Criminal Procedure, is therefore unsustainable, beyond the scope and ambit of Section 401 Code of Criminal Procedure, more particularly Sub-section (3) of Section 401 Code of Criminal Procedure.
In a case where the victim has a right of appeal against the order of acquittal, now as provided Under Section 372 Code of Criminal Procedure and the victim has not availed such a remedy and has not preferred the appeal, whether the revision application is required to be entertained at the instance of a party/victim instead of preferring an appeal? - HELD THAT:- It cannot be disputed that now after the amendment in Section 372 Code of Criminal Procedure after 2009 and insertion of proviso to Section 372 Code of Criminal Procedure, a victim has a statutory right of appeal against the order of acquittal. Therefore, no revision shall be entertained at the instance of the victim against the order of acquittal in a case where no appeal is preferred and the victim is to be relegated to file an appeal. Even the same would be in the interest of the victim himself/herself as while exercising the revisional jurisdiction, the scope would be very limited, however, while exercising the appellate jurisdiction, the appellate Court would have a wider jurisdiction than the revisional jurisdiction - in a case where the victim and/or the complainant, as the case may be, has not preferred and/or availed the remedy of appeal against the order of acquittal as provided Under Section 372 Code of Criminal Procedure or Section 378(4), as the case may be, the revision application against the order of acquittal at the instance of the victim or the complainant, as the case may be, shall not be entertained and the victim or the complainant, as the case may be, shall be relegated to prefer the appeal as provided Under Section 372 or Section 378(4), as the case may be.
While exercising the powers Under Sub-section (5) of Section 401 Code of Criminal Procedure treating the revision application as petition of appeal and deal with the same accordingly, the High Court is required to pass a judicial order? - HELD THAT:- While treating with the application for revision as petition of appeal and deal with the same accordingly, the High Court has to record the satisfaction as provided Under Sub-section (5) of Section 401 Code of Criminal Procedure. Therefore, where under the Code of Criminal Procedure an appeal lies, but an application for revision has been made to the High Court by any person, the High Court has jurisdiction to treat the application for revision as a petition of appeal and deal with the same accordingly as per Sub-section (5) of Section 401 Code of Criminal Procedure, however, subject to the High Court being satisfied that such an application was made under the erroneous belief that no appeal lies thereto and that it is necessary in the interests of justice so to do and for that purpose the High Court has to pass a judicial order, may be a formal order, to treat the application for revision as a petition of appeal and deal with the same accordingly.
While exercising the powers Under Sub-section (5) to Section 401 Code of Criminal Procedure to treat the revision application as a petition of appeal, the High Court is required to pass a judicial order. However, considering the fact that even otherwise being victims they are having the statutory right of appeal as per proviso to Section 372 Code of Criminal Procedure, we deem it fit and proper to remit the matter to the High Court to treat the revision applications as petition of appeals Under Section 372 Code of Criminal Procedure and to decide the same in accordance with law and on their own merits. The same would be in the interests of all, namely, the victims as well as the Accused, as the appellate Court would have a wider scope and jurisdiction as an appellate Court, rather than the revisional court.
The impugned common judgment and order passed by the High Court reversing the acquittal and convicting the Accused is hereby quashed and set aside. The matters are remitted to the High Court. The High Court is directed to treat the revision applications as appeals Under Section 372 Code of Criminal Procedure and thereafter to decide and dispose of the same in accordance with law.
Appeal allowed.
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2022 (1) TMI 1422 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL, NEW DELHI.
Owner of property in question - restraint from selling the property - HELD THAT:- From the perusal of the record it appears that the main Application that Company Petition No. 743/ 2017 is still pending before the Hon’ble National Company aw Tribunal, Mumbai Bench and we have been informed by the parties that the next date of the hearing in this case is 27.02.2022.
As the main Petition i.e. Company Petition No. 743/ 2017 is listed before the NCLT, Mumbai Bench is to be decided on merits, this Appeal is disposed off with the direction to the Hon’ble NCLT, Mumbai Bench to expedite the disposal of the Company Petition No. 743/ 2017 at an early date. As this an old matter and the Tribunal while hearing the main appeal i.e. Company Petition No. 743/ 2017 we will not prejudiced by any observation made in the Impugned Order passed by Learned Adjudicating Authority.
Appeal disposed off.
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2022 (1) TMI 1421 - DELHI HIGH COURT
Maintainability of petition - petition filed through S.P.A. holder - admissible evidences or not - HELD THAT:- In the instant case as well the petition has been filed through SPA holder which is per se not maintainable. Therefore no permission can be granted to the petitioner to file the present petition bearing No. CRL.M.C. 1571/2021 under article 227 of the Constitution of India read with section 482 of the Code of Criminal Procedure seeking quashing of FIR No. 258/2010 and the charge-sheet and all the proceedings arising therefrom including the proceedings initiated against the petitioner u/s 82/83 of the Code of Criminal Procedure through his SPA holder.
There are no ground to accept the prayer made in the present application the same is dismissed.
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2022 (1) TMI 1420 - SUPREME COURT
Disapproval of technical disqualification and consequential rejection of the technical bid of writ petitioner in respect of a tender floated by the appellant - whether the High Court has been justified in interfering with the view taken by the tender inviting authority, i.e., NVS, in rejection of the technical bid of writ petitioner for want of fulfilment of ‘Past Performance’ criterion about supply of ‘same or similar Category Products’ of 60% of bid quantity in at least one of the last three financial years?
HELD THAT:- The interference by the High Court in this matter does not appear justified, particularly when no case of mala fide or bias is alleged. Every decision of the administrative authority which may not appear plausible to the Court cannot, for that reason alone, be called arbitrary or whimsical. The High Court, in the present matter has obviously proceeded with an assumption that the view as being taken by it, in acceptance of the case of the writ petitioner, was required to be substituted in place of the views of the tender inviting authority. That has been an error of law and cannot sustain itself in view of the consistent binding decisions of this Court, including the 3-Judge Bench decision in M/S GALAXY TRANSPORT AGENCIES, CONTRACTORS, TRADERS, TRANSPORTS AND SUPPLIERS VERSUS M/S NEW J.K. ROADWAYS, FLEET OWNERS AND TRANSPORT CONTRACTORS & ORS. [2020 (12) TMI 1390 - SUPREME COURT].
The High Court, while supporting its process of reasoning, has referred to such principles which, with respect, we find entirely inapposite and beyond the periphery of the question involved in the present case. As noticed, in such matter of contracts, the process of interpretation of terms and conditions is essentially left to the author of the tender document and the occasion for interference by the Court would arise only if the questioned decision fails on the salutary tests laid down and settled by this Court in consistent decisions, namely, irrationality or unreasonableness or bias or procedural impropriety.
In the case of Nabha Power Limited [2017 (10) TMI 1549 - SUPREME COURT], as referred by the High Court, this Court, while referring to the concept of ‘Penta test’ for ‘business efficacy’, made it clear that such a test and thereby reading an “implied term”, would come in play only when the five conditions are satisfied. Even in that case, the Court, while dealing with the question of reimbursement of cost incurred by the successful bidder/power supplier towards washing of coal in a power procurement project, analysed as to what charges would be payable by interpretation of all the terms of the contract and held the appellant entitled to certain charges as the formula for energy charges was clear - In the present case too, neither the High Court was reading any “implied term” in the past performance criterion nor NVS had done so.
The terms of tender in the present case had been clear, and they were ascertainable with specificity available on the very portal on which NIT was issued. It had not been a case of post facto interpretations by the tender inviting authority-NVS. Certain suggestions made on behalf of the writ petitioner about the tender inviting authority changing the terms to suit a particular bidder remain baseless. No such case of mala fide has been made out; rather, as pointed out on behalf of the appellant, all the other tenderers clearly understood the meaning and requirement of the past performance criterion and stated the particulars of tablets supplied by them in the past. Such contentions of the writ petitioner have only been noted to be rejected.
Similarly, the submission made on behalf of the writ petitioner, that it had been awarded another contract for supply of 3,00,000 tablets, carries no meaning at all. Such a supply contract had not been a matter of evaluation in the tender process in question, where the quantity in the last three financial years before the bid opening date was to be considered. Any subsequent event could neither invest the writ petitioner with any right in the present matter nor the impugned order could be sustained on that basis.
The petition filed by the writ petitioner was required to be dismissed. The High Court having allowed the writ petition on rather irrelevant considerations, the impugned order is required to be set aside - appeal allowed.
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2022 (1) TMI 1419 - SUPREME COURT
Cancellation of bail granted - Murder - It is submitted that what is weighed with the High Court seems to be a parity as one other co-accused Shashi Bhushan Bhagat has been allowed bail - HELD THAT:- From the impugned judgment and order passed by the High Court, it can be seen that no reasons whatsoever have been assigned by the High Court while releasing the respondent No.2 on bail. After recording the submissions made by the learned counsel appearing on behalf of the accused and the State thereafter the High Court has only observed that “considering the rival submissions as also the facts and circumstances of the case, this Court for the purposes of grant of bail is inclined to accept the submissions advanced by the petitioner’s counsel. Prayer for the bail of the petitioner is allowed.” There is no further reasoning given at all. Neither the High Court has considered the gravity, nature and seriousness of the offences alleged against the accused.
A similar view has been expressed by this Court in the recent decision in the case of RAMESH BHAVAN RATHOD VERSUS VISHANBHAI HIRABHAI MAKWANA MAKWANA (KOLI) AND ORS. [2021 (4) TMI 1276 - SUPREME COURT]. Emphasizing on giving brief reasons while granting bail, it is observed by this Court in the above case that though it is a well settled principle that in determining as to whether bail should be granted, the High Court, or for that matter, the Sessions Court deciding an application under Section 439 Cr.P.C. would not launch upon a detailed evaluation of the facts on merits since a criminal trial is still to take place. It is further observed that however the Court granting bail cannot obviate its duty to apply a judicial mind and to record reasons, brief as they may be, for the purpose of deciding whether or not to grant bail.
Considering the fact that respondent No.2 is a history sheeter and is having a criminal antecedent and is involved in the double murder of having killed the father and brother of the informant and the trial of these cases is at the crucial stage of recording evidence and there are allegations of pressurizing the informant and the witnesses, the impugned judgment and order passed by the High Court releasing the respondent No.2 on bail is absolutely unsustainable and the same cannot stand. The High Court has not at all considered the gravity, nature and seriousness of the offences alleged.
The impugned judgment and order passed by the High Court releasing the respondent No.2 on bail is hereby quashed and set aside - Petition allowed.
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2022 (1) TMI 1418 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL, NEW DELHI
Rejection of Application filed by the Appellant/Operational Creditor under Section 9 of the Insolvency and Bankruptcy Code, 2016 - existence of disputes or not - HELD THAT:- From the perusal of the record and argument advanced on behalf of the Respondent and the emails corresponded between the parties are much prior to receipt of the statutory notice issued under Section 8 of the IBC which is evident from Reply Affidavit filed by the Respondent - The Respondent have raised disputes much prior to sending of the notice under Section 8 of the IBC.
The Appellant neither denied these facts nor doubted these emails corresponded between the parties. These facts show that there was preexisting dispute between the parties - The Ld. Adjudicating Authority has rightly taken note of these emails and come to the conclusion that there is pre-existing dispute between the parties and rejected the Application under Section 9 of the IBC filed by the Appellant herein.
The impugned order is set aside - appeal dismissed.
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2022 (1) TMI 1417 - ITAT MUMBAI
Addition u/s 43CA - difference between the agreement value and market value as per registered agreement - assessee stated that payment & allotment letters for the impugned items were received much earlier - CIT(A) has held that he was of the opinion that invariably the stamp value date on registration has to be adopted and hence, he was upholding the order of the AO
HELD THAT:- CIT(A) conclusion is quiet contrary to what the AO has held. AO has clearly accepted the assessee’s contentions that he is in agreement that ready recokner value on the date of allotment is being considered. Hence, the reason for CIT(A) in upholding the addition is not as per the facts on record.
In any case, we note that this is assessees plea that section 43CA was introduced w.e.f. 01.04.2013 and the agreement under consideration were entered into prior to 31.03.2013.This is assessees plea that difference is only 5% between the ready recokner rate and sale consideration.
Hence, this is assessees plea that the same has to be ignored on the touchstone of Krishna Enterprises vs ACIT[2016 (12) TMI 52 - ITAT MUMBAI] - Thus issue decided in favour of the assessee.
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2022 (1) TMI 1416 - GUJARAT HIGH COURT
Reopening of assessment u/s 147 - Bogus LTCG - Penny stock transactions - reason to believe - information received from the intelligence being of Kolkata is only information relied upon - independent application of mind v/s borrowed satisfaction - Tribunal allowed the appeal of the assessee by holding that the Assessing Officer’s reasons recorded fall in the zone of “reasons to suspect” and not “reasons to believe”
HELD THAT:- Undoubtedly, there exists a material on record that after the original assessment was concluded, the information had been received from the Investigating Wing, Kolkata, which carried on the survey and search operations, where it was established that the large number of penny stock companies share prices were artificially manipulated on the stock exchanges in order to book bogus claims of LTCG/Loss.
The statement had also been recorded of Shri Sanjay Vora u/s 131 of the Act, which does not contain the name of the assessee and it also does not relate to the broker of assessee, since the sale is not through M/s.Anand Rathi Shares and Stock Brokers Ltd., but through Arcadia Share and Brokers Pvt.Ltd. Thus, on obtaining this information, there shall need to be a reason for formation of belief that there is a rational connection having live link between the material coming to the income tax officer and his formation of belief that the income chargeable to tax has escaped the assessment of the particular year.
Even when the Court is not required to go into the sufficiency or adequacy of the material, it is a must for the AO to establish the rational connection of direct nexus or live link between the material coming to the notice of the officer and formation of his belief. There does not appear to be any material connecting the present assessee, where information in relation to the third party has been used by the AO. There is nothing to indicate as to how in absence of any explicit connection of the assessee with the information received from the another agency, the reassessment proceedings have been initiated. The statement recorded of Shri Sanjay Vora also does not name the assessee nor has there been any link of the broker through whom the assessee has sold the shares.
Of course, the company whose share has been purchased by the assessee is alleged to be one of the penny stock companies. Therefore, the reasons recorded were drawn from survey and search operation in relation to the other assessees and therefore, the requirements of the statute does not appear to be satisfied. Even if, there is a needle of suspicion towards the assessee, the Assessing Officer shall need to act upon his own belief that the twin conditions required under the statute are satisfied before he initiates the proceedings of reassessment.
this Court cannot be oblivious of the requirement of satisfying these conditions before the reassessment proceedings are initiated, there appears to be a borrowed satisfaction. It has chosen to merely considered the information/material received from other source without forming any independent opinion on the basis of the material on record that income has escaped the assessment. His suspicion of the assessee dealing with the shares and claiming of LTCG would not provide the sufficient grounds for reopening.
The exercise which is based on suspicion is not permissible for reopening and any notice for reassessment in such circumstances would need to be termed as a fishing inquiry only.
The Apex Court interpreted the word “reason to believe” in case of Central Prominces Mangnese Ore Company ltd. (1991 (8) TMI 4 - SUPREME COURT] it held that, the word “reason” in the phrase “reason to believe” in Section 147, would mean cause or justification to know that income had escaped the assessment he can be said to have reason to believe. This expression does not mean that the Assessing Officer should have finally ascertained the fact by legal evidence or conclusion.
AO to form the opinion there shall need to be some link with the material and as discussed above, the same is missing, the challenge needs to fail. Though no rigid format is a must to express application of mind or for formation of belief that income chargeable to tax has escaped assessment and yet, when reliance on the information is mechanical without reassessment for the verification, independent opinion needs to be held to be absent. Decided against revenue.
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2022 (1) TMI 1415 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL, NEW DELHI.
Reconsideration of approved Resolution Plan - the ‘Assenting Financial Creditors’ (AFC) constituting 94.98%, who have approved the Resolution Plan submitted by the SRA has filed an affidavit stating that they feel duty bound to reconsider their decision in larger public interest resulting from unprecedent haircut of 95% & observations of the Adjudicating Authority as also this Appellate Tribunal.
HELD THAT:- Power to reconsider any decision is within the domain of CoC and even Hon’ble Apex Court in Catena of judgment held that the commercial wisdom of the CoCs is non justifiable and hence, it is in the domain of CoC, particularly, if at a later stage, it finds in public interest and the amount of loss which the public exchequer is to bear with such unprecedented haircut in such a large fund employment, it is in the fitness of thing that the proposal can be remanded back to the CoC, particularly, in view of their own affidavit to review their decision. The CoC is not functus –officio on the approval of the Resolution plan and accordingly, the judicial precedents clearly established that the Adjudicating Authority and this Tribunal is competent to send back the Resolution plan to the CoC for reconsideration.
The Hon’ble Supreme Court decision in Committee of Creditors of Essar Steel India Ltd, Through authorized signatory Vs. Satish Kumar Gupta & Ors. [2019 (11) TMI 731 - SUPREME COURT] had referred and affirmed this power to remand back.
In the present case, the resolution plan is not complying with Section 30(2)(b) of the Code r/w Section 31 of the Code. Hence, it can be remanded back to the CoC.
Vide para 4 of the Resolution Plan on overview of the implementing entity / resolution applicant, it reveals that the resolution applicants group turnover is Rs. 84,447 crore in the year 2019-2020 (para 4.2.2 of the Resolution Plan- page 253 of CA(AT) (Ins) No. 503 of 2021). Vide para 7.1.2 of the Resolution Plan, the Resolution Applicant has accepted the requirement of approval / permission of CCI in accordance with the Code prior to the approval of CoC. In the 19th CoC meeting held on 11.11.2020, the CoC were apprised of acknowledgment copy of the applications filed with the CCI seeking CCI approval of the resolution under the present case.
It is very much clear that prior approval of the CCI has not been obtained as per proviso to section 31(4) of the Code. This reflects that the approved Resolution Plan requires review and reconsideration for the legal compliances. Statutory compliances does not fall under the commercial wisdom of the CoC. Hence, the statutory compliances as mandated by proviso to Section 31 (4), have to be ensured before the Resolution Plan is approved by CoC.
Section 30 (2)(b) of the Code has not been complied with and hence, the approval of the Resolution Plan is not in accordance with Section 31 of the Code. Accordingly, the approval of Resolution Plan by the CoC as well as Adjudicating Authority is set aside and the matter is remitted back to CoC for completion of the process relating to CIRP in accordance with the provisions of the Code.
Appeal dismissed.
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2022 (1) TMI 1414 - ITAT KOLKATA
Denial of credit of TDS - HELD THAT:- A perusal of the impugned orders of the ld. CIT(A) reveals that the ld. CIT(A) after considering the submissions of the assessee has directed the AO to verify the claim of the assessee and allow the necessary credit of the taxes paid/deducted at source as per law. Since the CIT(A) has already granted relief to the assessee by directing the AO to verify the claim of the assessee, therefore do not find any reason to interfere in the order of the ld. CIT(A). The appeals of the assessee are, therefore dismissed.
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