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Showing 441 to 460 of 6467 Records

• 2001 (12) TMI 6
  

  "Whether, on the facts and in the circumstances of the case, the claim on account of interest was allowable?" - Tribunal has found that the source of income, viz., shares stood transferred and hence the purpose for which the borrowing had been made, stood frustrated. In fact the expenditure had not been incurred for preserving and maintaining the source of income nor was it a case where the assessee had no option except to incur the expenditure, but on the contrary, the assessee had the option, viz., it was not necessary for the assessee to transfer the shares for claiming the deduction and yet the assessee exercised the option the other way by transferring shares which had no connection with the making or earning of the income. - we do not find any infirmity with the order of the Tribunal and the Tribunal was right in holding that the assessee's claim on account of interest was not allowable.

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• 2001 (12) TMI 5
  

  Capital gains - assessee submitted that there is another issue pertaining to substitution of indexed cost of acquisition and interest under section 234B which was the subject matter of the revision petition dated January 18, 2000, and the same has also been dismissed by the aforesaid common order.- On a perusal of the impugned order of the Commissioner of Income-tax under section 264 dated March 30, 2001, it is seen that although the revision petition dated September 28, 2000, has been filed as supplementary petition to the original revision petition dated January 18, 2000, for all practical purposes, both the revision petitions have been considered to be two separate and distinct petitions and even the prescribed fee of Rs. 25 has been paid separately. Merely because, two revision petitions have been disposed of by a common order, it is not open to the petitioner to file a combined petition and pay court fees payable on one petition only.

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• 2001 (12) TMI 4
  

  Computing the deduction under section 80HHC - "1. Whether, on the facts and in the circumstances of the case, will not the amounts of Rs. 10,045 and Rs. 1,17,483 received by the assessee towards quality claim and raw nut claim form part of the total turnover of the assessee and the Tribunal is right in law in excluding the two amounts from the total turnover for the purpose of computing the deduction under section 80HHC of the Income-tax Act? - 2. Whether, in view of Explanation (ba) to section 80HHC and clauses (iiia), (iiib) and (iiic) of section 28, will not turnover take into account all other receipts other than the excluded items of receipts?" - The questions are answered against the Revenue, and in favour of the assessee, and the appeal filed by the Department is dismissed

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• 2001 (12) TMI 3
  

  Exemption Notification - Interpretation of the phrase "on which the appropriate amount of duty of excise has already been paid" - meaning of the word “appropriate” - Exempted or Nil rate does not mean appropriate rate of duty.

  HELD THAT:- An exemption notification that uses the said phrase applies to goods which have been made from duty paid material. In the said phrase, due emphasis must be given to the words "has already been paid". For the purposes of getting the benefit of the exemption under the notification, the goods must be made from raw material on which excise duty has, as a matter of fact, been paid, and has been paid at the "appropriate" or correct rate. Unless the manufacturer has paid, the correct amount of excise duty, he is not entitled to the benefit of the exemption notification.

  Where the raw material is not liable to excise duty or such duty is nil, no excise duty is, as a matter of fact, paid upon it. To goods made out of such material the notification will not apply.

  We need to made it clear that, regardless of the interpretation that we have placed on the said phrase, if there are circulars which have been issued by the Central Board of Excise and Customs which place a different interpretation upon the said phrase, that interpretation will be binding upon the Revenue.

  These appeals shall now be placed before a Bench of two learned Judges, who will decide the same on their merits. This is done having regard to the fact that other issues may be involved.

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• 2001 (12) TMI 2
  
  The appellate tribunal upheld the rejection of a refund claim for Service Tax as part of the claim was filed beyond the time limit and the rest was rejected due to unjust enrichment. The claimant had collected and deposited the Service Tax, making a refund impermissible under Section 11B of the Central Excise Act. The tribunal stated that statutory authorities must handle claims in accordance with the relevant statute and refrained from considering relief under the Contract Act.

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• 2001 (12) TMI 1
  
  Issues:
  1. Demand of interest and penalty under Sections 76 and 77 of the Finance Act.
  2. Dispute regarding the date of tax payment and imposition of interest and penalty.
  3. Imposition of penalty under Section 77 for delay in filing return.
  
  Analysis:
  Issue 1: The appeal was filed against the Order-in-Appeal affirming the demand of interest and penalty under Sections 76 and 77 of the Finance Act. The Deputy Commissioner confirmed the demand based on a delay in tax payment by the appellants. The appellants argued that they deposited the tax amount before the due date, but the cheque was encashed after the due date, leading to the demand. However, the Tribunal found that the payment by cheque is permissible under the Finance Act, and as per relevant rules and circulars, if the cheque is not dishonored and deposited before the due date, no interest or penalty should be imposed. Therefore, the demand for interest and penalty under Section 76 was set aside.
  
  Issue 2: The Tribunal acknowledged that the penalty under Section 77 for delay in filing the return could not be challenged as the appellants failed to provide a sufficient cause for the delay. The amount of penalty imposed was deemed reasonable and justified. Hence, the imposition of penalty under Section 77 was upheld, and this part of the impugned order was maintained.
  
  In conclusion, the Tribunal set aside the demand of interest and penalty under Section 76 while upholding the penalty under Section 77. The impugned order of the Commissioner (Appeals) was modified accordingly, and the appeal of the appellants was disposed of in these terms.

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• 2001 (11) TMI 1062
  
  ISSUES PRESENTED and CONSIDERED

  The core legal questions considered in this judgment are:

  • Whether the petition under Section 482 of the Code of Criminal Procedure and Article 227 of the Constitution is maintainable when the petitioner has already availed the remedy of criminal revision under Sections 397/401 of the Code.
  • Whether there is any illegality or grave injustice in the concurrent findings of the lower courts that would justify the invocation of the High Court's powers under Section 482 of the Code or Article 227 of the Constitution.

  ISSUE-WISE DETAILED ANALYSIS

  1. Maintainability of the Petition under Section 482 of the Code and Article 227 of the Constitution

  • Relevant legal framework and precedents: The legal framework involves Section 482 of the Code of Criminal Procedure, which provides inherent powers to the High Court to make such orders as may be necessary to prevent abuse of the process of any court or otherwise to secure the ends of justice. Article 227 of the Constitution grants the High Court the power of superintendence over all courts and tribunals within its jurisdiction. Sub-section (2) of Section 397 of the Code bars a second revision petition.
  • Court's interpretation and reasoning: The Court interpreted that since the petitioner had already availed the remedy of criminal revision under Sections 397/401, a second revision is barred by Sub-section (2) of Section 397. The Court emphasized that the scope of Section 482 and Article 227 is narrow and can only be invoked in rare cases of grave injustice.
  • Key evidence and findings: The Court noted the concurrent findings of the lower courts that the respondent lacked means to maintain herself and that the petitioner was not providing maintenance.
  • Application of law to facts: The Court applied the legal provisions to the facts by determining that the petition was essentially a second revision, which is not maintainable under the law.
  • Treatment of competing arguments: The petitioner did not present any arguments due to absence during the hearing. The Court considered the arguments of the respondent's counsel and the records of the case.
  • Conclusions: The Court concluded that the petition is not maintainable as it is essentially a second revision, barred by Sub-section (2) of Section 397 of the Code.

  2. Examination of Alleged Illegality or Grave Injustice

  • Relevant legal framework and precedents: The Court referred to the inherent powers under Section 482 of the Code and the supervisory powers under Article 227 of the Constitution, which are to be exercised only in exceptional circumstances.
  • Court's interpretation and reasoning: The Court found no illegality or grave injustice in the concurrent findings of the lower courts. It stressed that the powers under Section 482 and Article 227 are not meant to re-evaluate evidence or findings of fact unless there is a manifest error leading to injustice.
  • Key evidence and findings: The findings of the lower courts were based on the evidence that the respondent was unable to maintain herself and was not being maintained by the petitioner.
  • Application of law to facts: The Court applied the narrow scope of its powers to the facts, determining that there was no basis for interference as no grave injustice or abuse of process was evident.
  • Treatment of competing arguments: The Court noted the absence of any compelling argument from the petitioner that would necessitate the exercise of its inherent or supervisory powers.
  • Conclusions: The Court concluded that there was no justification for invoking its powers under Section 482 or Article 227, as no grave injustice or abuse of process was demonstrated.

  SIGNIFICANT HOLDINGS

  • Preserve verbatim quotes of crucial legal reasoning: "The powers of this Court sought to be invoked, can be exercised only in the rarest of the rare cases where grave injustice is shown to have been caused and requires to be undone."
  • Core principles established: The judgment reinforces the principle that a second revision petition is not maintainable under Sub-section (2) of Section 397 of the Code. It also underscores the limited scope of the High Court's powers under Section 482 of the Code and Article 227 of the Constitution, which are to be exercised only in exceptional cases of manifest injustice or abuse of process.
  • Final determinations on each issue: The petition was dismissed as it was deemed a second revision, which is not maintainable. The Court found no basis for exercising its inherent or supervisory powers due to the absence of any grave injustice or illegality in the lower courts' findings.

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• 2001 (11) TMI 1061
  
  Issues:
  1. Determination of employment status of canteen workers.
  2. Interpretation of Section 46 of the Factories Act, 1948.
  3. Application of previous judgments on the issue.
  4. Examination of contractual terms between establishment and contractor.
  5. Evaluation of control and supervision exercised by the establishment over canteen workers.
  
  Analysis:
  
  1. The case involved a dispute regarding the employment status of canteen workers in a government undertaking. The workers claimed to be regular employees of the establishment, while the Labour Court and High Court held them to be employees of the contractor. The central issue was whether the workers were employees of the establishment or the contractor.
  
  2. The appellants contended that the establishment was obligated under Section 46 of the Factories Act, 1948, to provide a canteen, making the canteen workers its employees. However, the court noted that mere establishment of a canteen does not automatically make the canteen workers employees of the establishment unless there is direct administrative control over them.
  
  3. The appellants relied on the decision in Parimal Chandra Raha's case, but the court referred to Indian Petrochemicals Corporation Ltd. v. Shramik Sena, clarifying that canteen workers are considered employees of the establishment only for the purpose of the Factories Act unless complete administrative control is proven.
  
  4. The court examined the contractual terms between the establishment and the contractor. The agreement specified the responsibilities of the contractor, including providing infrastructure, raw materials, and complying with labor laws. The contractor had discretion in employing workers and was responsible for their salaries and legal liabilities.
  
  5. The court assessed the control and supervision exercised by the establishment over the canteen workers. It was observed that the establishment did not have a say in the recruitment process, payment of salaries, or day-to-day operations of the canteen. The workers failed to prove that the establishment exercised control over them, leading to the conclusion that they were not employees of the establishment.
  
  6. Ultimately, the court upheld the findings of the Labour Court, dismissing the appeal. The High Court's decision was deemed appropriate, and there was no need to reevaluate the evidence. The case highlighted the importance of factual determinations in employment disputes and the significance of proving administrative control for establishing employment status.

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• 2001 (11) TMI 1060
  
  Issues Involved:
  1. Validity of the Extraordinary General Meeting (EOGM) held on 24.3.1999.
  2. Legality of the allotment of 2,000 additional shares to the third respondent.
  3. Compliance with Article 10 of the Articles of Association regarding the transfer of shares by three groups of shareholders to the third respondent.
  
  Detailed Analysis:
  
  1. Validity of the Extraordinary General Meeting (EOGM) held on 24.3.1999:
  
  The petitioners alleged that no notice of the EOGM was given to them and that the meeting did not actually take place, with the minutes being fabricated. The respondents claimed the EOGM was held after due notice to all shareholders, but failed to produce any evidence, such as postal certificates or dispatch registers, to support their claim. The court noted that the respondents did not provide proof of service of notice or minutes of the Board meeting that allegedly decided to call the EOGM. The court found the petitioners' denial of receipt of notice sufficient to rebut the presumption of posting, and the respondents failed to discharge their burden of proof. Therefore, the court held that the EOGM was not validly held, and the decisions taken thereat were invalid.
  
  2. Legality of the allotment of 2,000 additional shares to the third respondent:
  
  Despite the invalidity of the EOGM, the court considered whether the allotment of shares was in the interest of the company. The court noted that the company was in financial difficulties and that the majority of shareholders had approved the allotment to the third respondent, who had been managing the company as a licensee. The court concluded that the decision to allot shares was taken in the interest of the company and, therefore, should not be nullified on the ground of oppression. The court also found that the petitioners' letters expressing their desire to purchase shares were not conclusively established.
  
  3. Compliance with Article 10 of the Articles of Association regarding the transfer of shares by three groups of shareholders to the third respondent:
  
  The petitioners argued that the transfer of shares violated Article 10, which requires shares to be offered to existing members before being transferred to non-members. The court noted that Article 10(a) allows members to identify a willing member on their own and negotiate the price. Since the third respondent became a shareholder on 24.3.1999, the transfer of shares to him was in accordance with Article 10(a). The court held that the petitioners would have been entitled to only 23% of the shares transferred, not all the shares. The court concluded that the transfer of shares, even if in violation of Article 10, was done in the interest of the company and could not be considered an act of oppression.
  
  Conclusion:
  
  The court directed that the petitioners' group should exit the company on receipt of proper consideration for their shares. The valuation of the shares was to be done by the statutory auditors based on the balance sheet as of 31.3.2000. The respondents or the company would purchase the petitioners' shares based on this valuation. The court disposed of the petition with no order as to costs.

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• 2001 (11) TMI 1059
  
  Issues involved:
  Appeal against order of eviction under Bihar Building (Lease, Rent & Eviction) Control Act, 1982 based on bonafide requirement for starting a clinic, revision petition under proviso to Section 14(8) of the Act, scope of revisional jurisdiction, comparison with Delhi Rent Control Act, 1958, re-appreciation of evidence, legality of High Court's judgment.
  
  Analysis:
  
  1. Eviction Order and Grounds for Appeal:
  The appeal challenged the High Court's decision allowing an application under Section 14(8) of the Bihar Building (Lease, Rent & Eviction) Control Act, 1982, which set aside the eviction order passed by the Trial Court. The landlords sought eviction of tenants based on the ground that the premises were required for starting a clinic for their son-in-law, a medical graduate.
  
  2. Trial Court Decision and High Court's Findings:
  The Trial Court found the eviction justified, considering the bonafide requirement of the landlords for the clinic. However, the High Court, in its revisional jurisdiction, held that the landlords' need was not genuine, as the son-in-law had alternative accommodation and the landlords' claim was merely a desire. The High Court re-evaluated the evidence, leading to a different conclusion.
  
  3. Scope of Revisional Jurisdiction and Legal Precedent:
  The judgment discussed the proviso to Section 14(8) of the Act, emphasizing the High Court's role in ensuring the legality of the eviction order. Reference was made to a similar provision in the Delhi Rent Control Act, 1958, highlighting the limited scope of revisional jurisdiction to assess if the order is according to law, not for re-assessment of facts.
  
  4. Analysis of High Court's Decision:
  The Supreme Court analyzed the High Court's judgment and found that it had exceeded its jurisdiction by disregarding the Trial Court's findings based on evidence. The High Court's failure to consider crucial facts, such as the son-in-law's current practice in one room of the premises, led to an erroneous conclusion. The Supreme Court emphasized that the High Court's role was not to act as an appellate court but to ensure legal compliance.
  
  5. Final Decision and Directions:
  Consequently, the Supreme Court allowed the appeal, setting aside the High Court's judgment, and reinstated the Trial Court's decision for eviction. The respondent-tenant was granted time until December 31, 2002, to vacate the premises for justice and alternative arrangements, subject to fulfilling necessary requirements within four weeks.
  
  By meticulously examining the legal issues, the Supreme Court clarified the boundaries of revisional jurisdiction and upheld the importance of evidence-based decisions in eviction cases under the specified Acts, ensuring legal compliance and fair treatment of parties involved.

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• 2001 (11) TMI 1058
  
  Issues:
  Interpretation of the term "advertisement" under Sections 328 and 328A of the Mumbai Municipal Corporation Act, 1888.
  
  Analysis:
  1. The judgment in question revolves around the interpretation of whether an illuminated neon signboard displayed by the respondent on her restaurant constitutes an advertisement under Sections 328 and 328A of the Mumbai Municipal Corporation Act, 1888. The single Judge had ruled that the signboard did not amount to an advertisement, leading to an appeal by the Municipal Corporation for Greater Mumbai.
  
  2. The respondent's restaurant displayed an illuminated neon signboard with the words "ASHOK RESTAURANT AND BEER BAR." The signboard also featured an artistic sign depicting two hands joined in the traditional "Namaste." The main contention was whether this signboard fell under the definition of an advertisement as per the relevant provisions of the Act.
  
  3. The key issue before the Court was whether the illuminated neon signboard qualified as an advertisement under the Act, specifically Section 328A. The section required written permission from the Commissioner for any advertisement displayed on land, building, or structure. The Court had to determine if the signboard in question fell within this regulatory framework.
  
  4. The Court considered the definition of advertisement as per the policy guideline on the grant of permission for display of advertisements. The guideline broadly defined advertisement as any device or representation visible from a street, including posters, hoardings, illuminated signs, and direction boards. This definition played a crucial role in the Court's analysis of whether the neon signboard constituted an advertisement.
  
  5. The Court differentiated between an advertisement and a sky-sign, emphasizing that the case at hand did not involve a sky-sign as defined by the Act. The Court referred to previous judgments and policy guidelines to establish a framework for determining what constitutes an advertisement under the specific provisions of the Mumbai Municipal Corporation Act.
  
  6. The Court extensively analyzed previous judgments, including one involving a petrol pump location sign, to establish the criteria for categorizing a display as an advertisement. The Court emphasized that each case must be assessed based on its unique circumstances to determine whether a particular display qualifies as an advertisement.
  
  7. Ultimately, the Court held that the illuminated neon signboard in question was indeed an advertisement. The Court reasoned that the size and intent of the signboard indicated that it was meant to attract customers to the restaurant, rather than merely indicating the location. As a result, the Court allowed the appeal, setting aside the single Judge's order and ruling in favor of the Municipal Corporation for Greater Mumbai.
  
  8. The judgment provides a detailed analysis of the term "advertisement" under the Mumbai Municipal Corporation Act, emphasizing the need to consider the purpose, size, and intent behind a display to determine its classification. The Court's decision clarifies the scope of the Act's provisions regarding advertisements and sets a precedent for similar cases in the future.

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• 2001 (11) TMI 1057
  
  Issues:
  Violation of fundamental right under Article 21 of the Constitution of India by passive smoking in public places, harmful effects of smoking on health, necessity to prohibit smoking in public places, statutory provisions for prohibiting smoking in public places, and the need for effective steps to ensure compliance.
  
  Violation of Fundamental Right under Article 21:
  The judgment addresses the issue of whether passive smoking in public places violates the fundamental right guaranteed under Article 21 of the Constitution of India, which states that no one shall be deprived of their life without due process of law. The Court emphasizes that non-smokers should not be afflicted by diseases like lung cancer or heart issues due to exposure to secondhand smoke in public places. The harmful effects of smoking on both smokers and passive smokers are acknowledged, leading to the conclusion that compelling non-smokers to endure air pollution is unjust and indirectly deprives them of their right to life without due process of law.
  
  Necessity to Prohibit Smoking in Public Places:
  The judgment discusses the necessity of prohibiting smoking in public places due to the harmful effects of tobacco smoking on health. The Court highlights the relationship between smoking and various diseases, such as lung cancer, chronic bronchitis, heart diseases, and cancer of different organs. The adverse impact of smoking on public health is recognized, with statistics indicating a significant number of deaths annually attributed to tobacco-related illnesses. The Court emphasizes the need to protect non-smokers from the harmful effects of passive smoking and stresses the importance of implementing measures to prohibit smoking in public spaces.
  
  Statutory Provisions and Legislative Actions:
  The judgment mentions the existing statutory provisions and legislative actions aimed at prohibiting smoking in public places. It refers to the Cigarettes (Regulation of Production, Supply and Distribution) Act, 1975, and the Cigarettes and Other Tobacco Products (Prohibition of Advertisement and Regulation of Trade and Commerce, Production, Supply and Distribution) Bill, 2001. The Court notes that while efforts are being made to introduce laws to restrict smoking in public areas, immediate action is required to address the adverse effects of smoking on public health. The State of Rajasthan and Delhi are highlighted for their initiatives in passing laws to prohibit smoking in specific public spaces.
  
  Effective Steps for Compliance:
  The judgment emphasizes the need for effective steps to ensure compliance with the prohibition of smoking in public places. The Court directs the Union of India, State Governments, and Union Territories to take necessary actions to prohibit smoking in various public settings, including auditoriums, hospital buildings, educational institutions, and public conveyances like railways. It is stressed that individuals not engaging in smoking should not be subjected to passive smoking due to the actions of smokers. The Court also instructs the Registrar General to inform relevant authorities and request compliance reports within a specified timeframe, demonstrating the seriousness of enforcing the prohibition effectively.
  
  In conclusion, the judgment addresses the violation of fundamental rights due to passive smoking in public places, advocates for the prohibition of smoking in such settings, highlights existing statutory provisions and legislative actions, and emphasizes the importance of taking effective steps to ensure compliance with the prohibition to safeguard public health.

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• 2001 (11) TMI 1056
  
  Issues Involved:
  1. Determination of whether the master plan in existence at the commencement of the Urban Land (Ceiling & Regulations) Act, 1976, or a subsequent master plan, should be considered for identifying vacant land exceeding the ceiling limit.
  2. Interpretation of the term "commencement of the Act" in relation to the Urban Land (Ceiling & Regulations) Act, 1976.
  3. Validity of the High Court's reliance on the decision in Atia Mohammadi Begum v. State of U.P. and its interpretation of the master plan's role.
  
  Issue-wise Detailed Analysis:
  
  1. Determination of the Relevant Master Plan:
  The primary issue in these appeals was whether the master plan that existed when the Urban Land (Ceiling & Regulations) Act, 1976, was enforced, or a subsequent master plan, should be considered to determine if land is vacant and held in excess of the ceiling limit. The High Court, relying on the decision in Atia Mohammadi Begum v. State of U.P., held that land not vacant on the date of the Act's commencement cannot be converted into vacant land by a subsequent master plan. The Supreme Court, however, concluded that the master plan prepared as per law in force, even subsequent to the enforcement of the Act, is to be taken into consideration. This decision overruled the High Court's view and the precedent set by Atia Begum's case to the extent that it suggested the master plan at the Act's commencement was the only relevant plan.
  
  2. Interpretation of "Commencement of the Act":
  The term "commencement of the Act" was clarified with reference to the explanation provided in Section 6. The explanation indicates that the commencement date could vary depending on when the land becomes vacant. The Supreme Court emphasized that the Act's provisions, including the filing of statements under Sections 6, 7, 15, and 16, apply as and when land acquires the character of vacant land, which may not necessarily be on 17th February 1976. This interpretation supports the view that the master plan's dynamic nature must be considered, allowing for subsequent changes that could render land vacant.
  
  3. Validity of the High Court's Reliance on Atia Begum's Case:
  The Supreme Court critically examined the High Court's reliance on Atia Begum's case. It noted that Atia Begum's decision did not correctly interpret the law, particularly the explanation to Section 6(1), which contemplates land becoming vacant due to subsequent master plans. The Court pointed out that planning and development are ongoing processes and cannot be frozen as of 17th February 1976. Thus, the High Court's declaration of proceedings under the Act as null and void, based on the static interpretation of the master plan, was incorrect.
  
  In conclusion, the Supreme Court allowed the appeals (C.A. Nos. 3813/1996, 7238/2001, and 7239/2001) and dismissed the others (C.A. Nos. 1149/1985 and 10851/1996), affirming that subsequent master plans must be considered in determining vacant land under the Urban Land (Ceiling & Regulations) Act, 1976. The Court left open the question of the consequences of filing a statement under a wrong impression regarding excess vacant land for future determination. The assistance of Mr. Raju Ramachandran, Senior Advocate, as amicus curiae, was acknowledged with appreciation.

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• 2001 (11) TMI 1055
  
  Issues Involved:
  1. Admissibility of statements recorded during the Lie Detection Test.
  2. Authority of the witness to record statements.
  3. Stage at which objections regarding admissibility should be decided.
  4. Whether the impugned order is an interlocutory order and if revision can lie against it.
  5. Relevance and admissibility of expert testimony under Section 45 of the Indian Evidence Act.
  
  Detailed Analysis:
  
  1. Admissibility of Statements Recorded During the Lie Detection Test:
  The learned Addl. Sessions Judge ruled that the statements recorded by Dr. Smt. S. L. Vaya, PW-16, were confessional and thus inadmissible. The State contended that these statements were relevant under Section 45 of the Indian Evidence Act and should be admitted as expert evidence. The defense argued that these statements were made while the accused were in police custody and were thus inadmissible under Sections 25 and 26 of the Indian Evidence Act.
  
  2. Authority of the Witness to Record Statements:
  The Addl. Sessions Judge held that Dr. Smt. S. L. Vaya had no authority under the Criminal Procedure Code to record the statements of the accused. The State argued that since PW-16 is not a police officer, the statements recorded by her are not hit by Sections 25 or 26 of the Indian Evidence Act.
  
  3. Stage at Which Objections Regarding Admissibility Should be Decided:
  The State, relying on the Supreme Court decision in Bipin Shantilal Panchal v. State of Gujarat, argued that the Trial Court should record the evidence fully and decide on its admissibility at the final judgment stage. The defense countered that the Judge should admit only relevant and admissible evidence during the trial, as per Section 136 of the Indian Evidence Act.
  
  4. Whether the Impugned Order is an Interlocutory Order and If Revision Can Lie Against It:
  The defense argued that the impugned order was interlocutory and therefore not subject to revision. However, the court found that the order affected the rights of the parties and was thus not merely interlocutory. Therefore, the revision application was maintainable.
  
  5. Relevance and Admissibility of Expert Testimony Under Section 45 of the Indian Evidence Act:
  The court noted that the prosecution had not yet laid the foundation to establish PW-16 as an expert witness. The court directed that the trial should resume to allow the prosecution to lay this foundation and present relevant data and material regarding the Lie Detection Test.
  
  Conclusion:
  The court found that the Addl. Sessions Judge had committed a serious error by prematurely discarding the statements and closing the evidence of PW-16. The court emphasized that objections regarding admissibility should be noted and decided at the final judgment stage, as directed by the Supreme Court in Bipin Shantilal Panchal's case. The court set aside the impugned order and directed the Trial Court to resume the evidence of PW-16, allowing the prosecution to lay the necessary foundation for expert testimony. The revision application was allowed, and the rule was made absolute to this extent.

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• 2001 (11) TMI 1054
  
  Issues:
  1. Notice of dishonoring of the cheque under Section 138 of the Negotiable Instruments Act.
  2. Violation of Section 204(2) of the Criminal Procedure Code.
  
  Analysis:
  
  1. Notice of Dishonoring of the Cheque:
  The petitioner, facing prosecution under Section 138 of the Negotiable Instruments Act, contested the order of the Magistrate directing the issuance of process against him. The primary contention raised was the absence of notice regarding the dishonor of the cheque as required under Clause (b) of the proviso to Section 138 of the N.I. Act. The notice sent was returned with the endorsement "left, not known," raising doubts about the petitioner's awareness of the demand. The Court referred to precedents like State of Madhya Pradesh v. Hiralal and M.A. Sridhar v. Metallay N. Steel Corporation, emphasizing that deemed service of notice is subject to case-specific analysis. It was ruled that the determination of deemed service should occur after the evidence is presented and not at the initial stage, allowing the petitioner to raise this issue post-evidence presentation for the Trial Judge's consideration.
  
  2. Violation of Section 204(2) of the Cr. P.C.:
  The second contention raised by the petitioner was the violation of Section 204(2) of the Criminal Procedure Code, which mandates the filing of a list of prosecution witnesses before issuing summons or warrants against the accused. The Court noted the absence of such a list in the present case, highlighting the mandatory nature of Section 204(2) for absolute compliance. Citing the decision in Keshava Murthy, H.L. v. H. Veeraiah, it was emphasized that the purpose of requiring a witness list upfront is to ensure the accused is aware of the case against them and the witnesses involved. The Court disagreed with the argument of curability under Section 465 of the Cr. P.C., stating that the mandatory compliance of Section 204(2) must be upheld. Consequently, the Magistrate's order for issuing summons was set aside, and the case was remitted for compliance with the procedural requirement of filing a list of witnesses or a memo confirming the absence of additional witnesses before further proceedings.
  
  In conclusion, the petitions were disposed of in accordance with the detailed analysis provided for each issue raised by the petitioner, ensuring a fair and compliant legal process moving forward.

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• 2001 (11) TMI 1053
  
  Issues involved:
  1. Utilization of Modvat credit on Additional Excise Duty (AED) towards payment of Basic Excise Duty (BED) on final products.
  2. Interpretation of Rule 57F (12) in the context of utilizing credit for payment of duty on final products.
  
  Analysis:
  
  Issue 1: Utilization of Modvat credit on AED towards BED on final products
  The case involved a company engaged in manufacturing nylon products and utilizing Modvat credit under the scheme. The dispute arose when the department questioned the company's utilization of AED credit towards payment of AED on unprocessed fabrics. The Commissioner (Appeals) dismissed the appeal, citing a previous decision and holding that credit earned on BED cannot be used towards AED. However, the appellant argued that Modvat credit on AED can be utilized for payment of BED on final products. The Tribunal referred to a judgment in Modi Rubber Ltd. case where it was held that Rule 57F (12) permits the utilization of AED credit for payment of BED on final products. Following this precedent, the Tribunal set aside the Commissioner's order and allowed the appeal, directing the department to permit the company to use accumulated Modvat credit on AED towards payment of BED/AED on any final product produced in their factory.
  
  Issue 2: Interpretation of Rule 57F (12) for credit utilization
  The Tribunal analyzed Rule 57F (12) in detail, emphasizing the 'non obstante' clause and the enacting clause. It noted that the credit of AED paid on tyre-cord fabric was being utilized for paying BED on tubes, even though the fabric was not used as an input in tube manufacturing. The Tribunal found that all requirements of the enacting clause of Rule 57F (12) were met, allowing for the credit utilization. This interpretation was consistent with the decision in Modi Rubber Ltd. case and was followed in the Madura Coats Ltd. case. Consequently, the Tribunal set aside the Commissioner's order and directed the department to allow the appellant to use the Modvat credit on AED towards duty payment on final products.
  
  In conclusion, the Tribunal's judgment clarified the permissible utilization of Modvat credit on AED towards BED on final products, based on the interpretation of Rule 57F (12) and established precedents. The decision emphasized compliance with the enacting clause of the rule, ensuring that the appellant could benefit from the accumulated credit for duty payments on their manufactured goods.

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• 2001 (11) TMI 1051
  
  Issues:
  - Appeal against judgment and order dated 03.7.2000 by High Court of Patna
  - Closure of prosecution evidence by learned Sessions Judge
  - Transfer of the case to 2nd Additional Sessions Judge
  - Challenge of the order by accused in Criminal Revision No.530 of 1995
  - Rejection of application under Section 311 of CrPC by Addl. Sessions Judge
  - Filing of Criminal Misc. No.16453 of 2000 before High Court
  - Failure to inform police station officer-in-charge about trial proceedings
  - Duty of the Sessions Judge and APP in a murder trial
  - Interpretation of Section 311 of CrPC
  - Setting aside the order dated 2.6.2000 by the High Court
  
  Analysis:
  The appeal in this case was filed against the judgment and order dated 03.7.2000 by the High Court of Patna, confirming the order passed by the Additional Sessions Judge, Gaya. The appellant contended that his mother was killed by the accused, leading to charges under various sections of the IPC. The prosecution evidence was closed by the learned Sessions Judge without any request for adjournment or further witnesses from the APP. Subsequently, the case was transferred to the 2nd Additional Sessions Judge, who recalled the order closing the prosecution evidence. The accused challenged this decision in Criminal Revision No.530 of 1995 before the High Court, which set aside the order of the 2nd Additional Sessions Judge.
  
  The State then filed an application under Section 311 of the CrPC for examining witnesses, which was rejected by the Addl. Sessions Judge on the grounds of the High Court's previous order. The appellant then filed Criminal Misc. No.16453 of 2000 before the High Court, which was dismissed. The failure to inform the police station officer-in-charge about trial proceedings was highlighted, indicating a lack of coordination in the case. The duty of the Sessions Judge and APP in a murder trial was emphasized, stressing the importance of ensuring the presence of witnesses and preventing the frustration of the prosecution.
  
  The interpretation of Section 311 of the CrPC was crucial in this case, with the Court emphasizing its wide amplitude to summon material witnesses essential for a just decision. The Court cited previous judgments to support the view that the function of the criminal court is to administer justice, not to focus on errors or party performance. Consequently, the appeal was allowed, setting aside the High Court's order and directing the Sessions Judge to proceed with the case diligently, adhering to the provisions of the CrPC and ensuring the presence of witnesses for examination.

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• 2001 (11) TMI 1050
  
  Issues Involved:
  1. Whether a claim for unpaid insurance premia in respect of a ship amounts to "necessary supplies" within the meaning of section 5 of the Admiralty Courts Act, 1861 so as to constitute a maritime claim.
  2. Whether the plaint discloses a cause of action against the defendant No. 1 vessel, m.v. "Sea Success I".
  3. Maintainability of the Letters Patent Appeal against the order refusing to reject the plaint for want of disclosure of cause of action.
  4. The validity of interim orders and the Bank Guarantee furnished by the owners of the defendant No. 1 vessel.
  
  Detailed Analysis:
  
  1. Whether a claim for unpaid insurance premia in respect of a ship amounts to "necessary supplies" within the meaning of section 5 of the Admiralty Courts Act, 1861 so as to constitute a maritime claim:
  
  The court considered whether unpaid insurance premiums could be deemed as "necessaries" supplied to a ship under section 5 of the Admiralty Courts Act, 1861. The plaintiff argued that insurance is essential for a ship's operation and should be considered necessary. The defendants contended that insurance premiums do not directly benefit the ship but rather the owner, and hence cannot be classified as necessaries.
  
  The court examined various precedents, including The Heinrich Bjorn, which held that insurance premiums are not necessaries. However, the court noted that the maritime law evolves with changing commercial practices and international conventions like the 1999 Geneva Arrest Convention, which includes insurance premiums as maritime claims. The court concluded that in the modern context, insurance is crucial for a ship's operation and thus constitutes necessaries.
  
  2. Whether the plaint discloses a cause of action against the defendant No. 1 vessel, m.v. "Sea Success I":
  
  The court analyzed the allegations in the plaint, particularly paragraphs 1 and 14, which claimed that the defendant No. 1 vessel is a sistership of vessels "Sea Ranger" and "Sea Glory" owned by defendant No. 2 through its wholly-owned subsidiary. The court emphasized that ownership of a vessel is denoted by shares in the ship, and mere control through a subsidiary does not establish ownership.
  
  The court found that the allegations did not disclose a legally recognizable claim against the defendant No. 1 vessel. The inference that defendant No. 1 vessel was a sistership based on the subsidiary relationship was legally unsustainable. Consequently, the court held that the plaint did not disclose a cause of action against the defendant No. 1 vessel.
  
  3. Maintainability of the Letters Patent Appeal against the order refusing to reject the plaint for want of disclosure of cause of action:
  
  The court addressed the objection regarding the maintainability of the appeal. It referred to the Supreme Court's judgment in Shah Babulal Khimji, which categorized judgments into final, preliminary, and interlocutory judgments. The court held that an order refusing to reject a plaint under Order 7, Rule 11(a) of C.P.C. is a preliminary judgment because it affects a valuable right of the defendant and is thus appealable under Clause 15 of the Letters Patent.
  
  4. The validity of interim orders and the Bank Guarantee furnished by the owners of the defendant No. 1 vessel:
  
  Given the court's finding that the plaint did not disclose a cause of action against the defendant No. 1 vessel, all interim orders against the vessel were discharged. The Bank Guarantee furnished by the owners of the defendant No. 1 vessel was canceled, and the Prothonotary and Senior Master were directed to return it to the owners.
  
  Conclusion:
  
  The court affirmed that a claim for unpaid insurance premia constitutes necessaries within section 5 of the Admiralty Courts Act, 1861 and is a maritime claim. It overruled the objection to the maintainability of the appeal and held that the plaint did not disclose a cause of action against the defendant No. 1 vessel. Consequently, the plaint was rejected against the defendant No. 1 vessel, and all interim orders were discharged.

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• 2001 (11) TMI 1049
  
  The Supreme Court of India quashed the order granting bail to the accused by the Special Court (ND&PS) and the High Court. The accused should be taken into custody, and the trial may commence. Appeal disposed of accordingly.

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• 2001 (11) TMI 1048
  
  Issues Involved:
  1. Determination of Book Profit under section 115J of the Income-tax Act.
  2. Taxability of compensation received on surrender of tenancy rights.
  3. Classification of compensation as casual and non-recurring income under section 10(3).
  4. Definition of "transfer" under section 2(47) concerning tenancy rights.
  5. Capital gains computation for statutory tenants.
  6. Distinction between statutory and contractual tenants.
  7. Ignoring relevant judicial precedents.
  8. Inclusion of capital receipts in "book profit" under section 115J.
  
  Issue-wise Detailed Analysis:
  
  1. Determination of Book Profit under section 115J of the Income-tax Act:
  The Tribunal was directed by the Hon'ble Bombay High Court to decide the ground relating to the determination of Book profit under section 115J of the Income-tax Act. The Tribunal had previously not considered this question, and thus it was remanded for fresh consideration.
  
  2. Taxability of compensation received on surrender of tenancy rights:
  The assessee received Rs. 1,40,00,000 for surrendering its tenancy rights. The Hon'ble High Court held that the tenancy right is a capital asset, and the surrender thereof for consideration gives rise to a capital receipt. Since the tenancy right has no cost of acquisition, the consideration cannot be taxed under capital gains nor as casual or non-recurring income under section 10(3).
  
  3. Classification of compensation as casual and non-recurring income under section 10(3):
  The Tribunal had initially assessed the sum as casual and non-recurring income under section 10(3). However, the Hon'ble High Court concluded that the compensation received by the statutory tenant towards the surrender of tenancy rights was not casual and non-recurring income within the meaning of section 10(3).
  
  4. Definition of "transfer" under section 2(47) concerning tenancy rights:
  The Tribunal had held that the surrender of tenancy rights did not amount to a "transfer" within the meaning of section 2(47). The Hon'ble High Court agreed, stating that the surrender of tenancy rights by the statutory tenant to the landlord does not constitute a transfer under section 2(47).
  
  5. Capital gains computation for statutory tenants:
  The Tribunal had held that a statutory tenant had no right or interest that could be considered as property for computing capital gains. The Hon'ble High Court supported this view, indicating that the compensation received for surrendering tenancy rights could not be taxed as capital gains.
  
  6. Distinction between statutory and contractual tenants:
  The Tribunal had made a distinction between the rights of a contractual tenant and a statutory tenant. The Hon'ble High Court found this distinction unjustified for determining the taxability of the compensation received on surrender of tenancy rights.
  
  7. Ignoring relevant judicial precedents:
  The Tribunal was criticized for ignoring several decisions of the Bombay High Court directly on the issue, such as CIT v. Shirinbai P. Pundole, CIT v. Gehmi Jal Cooper, and Nila Products Ltd. v. CIT. The Hon'ble High Court emphasized that these precedents should have been considered.
  
  8. Inclusion of capital receipts in "book profit" under section 115J:
  The Tribunal was directed to consider whether the amount received for surrender of tenancy rights should be included as part of the "book profit" under section 115J. The Hon'ble High Court had held that the amount received was a capital receipt not chargeable to capital gains since there was no cost of acquisition. The Tribunal was instructed to examine if this capital receipt could be considered as "book profit" despite its classification in the accounts.
  
  Conclusion:
  The Tribunal concluded that the amount received for surrender of tenancy rights is a capital receipt and not exigible to capital gains tax under section 45. It was also held that there is no distinction between a statutory tenant and a contractual tenant for tax purposes, and the compensation cannot be taxed as casual or non-recurring income under section 10(3). The matter of including this amount in "book profit" under section 115J was remanded to the Assessing Officer for fresh consideration. The assessee's appeal was partly allowed.

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