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Showing 461 to 480 of 6071 Records
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2002 (12) TMI 15
"Whether the Tribunal was right in holding that interest income earned by the assessee was taxable under the head 'Other sources of income' and not under the head 'Business income' and, therefore, the Assessing Officer was not justified in charging maximum marginal rate under section 161(1A)?" - we hold that the income earned by the assessees was taxable at the maximum marginal rate under section 161(1A) of the Act. That, the said section was applicable as in this case the assessee has earned income which was assessable under the head "Business income". We, accordingly, answer the above question in the negative, i.e., in favour of the Department and against the assessee.
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2002 (12) TMI 14
The sole question for consideration is the date of starting of limitation for filing revision under sub-section (3) of section 264 - in my opinion, it is a case of callous negligence of the petitioner the conduct goes to show that the petitioner himself was responsible for belated filing of the revision after five years of having intimation of the passing of the assessment orders. Thus, in my opinion, the order P7 dismissing revision on the ground of limitation is in accordance with law and calls for no interference. - The petition is without merit and is dismissed
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2002 (12) TMI 13
Revenue contend that within the State they could refuse to follow the jurisdictional High Court's decision - held that If at the time when the power u/s 263 was exercised the decision of the jurisdictional HC had not been set aside by this court or at least had not been appealed from, it would not be open to the Commissioner to have proceeded on the basis that the HC was erroneous and that the AO who had acted in terms of the High Court's decision had acted erroneously.
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2002 (12) TMI 12
There is no dispute between the parties that the transactions of counter sales effected by the respondent involved customs clearance within the meaning of Explanation (aa) to section 80HHC(4A) and further that the sales were in convertible foreign exchange - In these circumstances, we are of the view that the Revenue having accepted and consistently followed the position of law settled by Ram Babu's case, particularly in the case of the assessee itself, there is no merit in this appeal
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2002 (12) TMI 11
Whether the Settlement Commission gets a complete role in total substitution of other authorities under the Income-tax Act, 1961 and if so, for what purpose and to what extent - Whether the Commission is empowered to waive the interest under section 234A while exercising its jurisdiction under section 245D(4) - Whether the assessment order passed by the AO prior to the admission of settlement application u/s 245C, will subsist and the recovery proceedings will continue or not
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2002 (12) TMI 10
Whether the assessee is required to pay any interest on the amount of tax on the income disclosed before the Settlement Commission as contemplated under sections 234A, 234B and 234C - interest on the "aggregate income" based on earlier disclosed and subsequently disclosed income, is to be determined by the Commission and on the tax found due on such income, interest will be charged in accordance with the provisions applicable in the regular assessment proceedings
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2002 (12) TMI 9
Whether the Tribunal is right in confirming the order of Commissioner of Wealth-tax (Appeals) directing the AO to exclude the value of the assets transferred to body of individuals from the wealth of the assessee - Once it is found, as a fact, that the creation of the BOI and assignment of assets was not sham and bogus activity, the question sought to be referred would not arise and, therefore, the Tribunal u/s 27(1) and the HC u/s 27(3) were right in rejecting the application of the Revenue.
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2002 (12) TMI 8
Assessee is incorporated as a company limited by guarantee under the Companies Act, 1956 - assessee's claim for the benefit of section 11 was denied by AO on two grounds - firstly, assessee was a diamond bourse and as such its objects were not "charitable purpose" - secondly, the assessee had breached the conditions under section 13 and as such was liable to be denied the benefit of section 11 - Contention of AO is justified - revenue's appeal allowed
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2002 (12) TMI 7
Purchase of Immovable Property by Central Government - appellants' challenge under article 226 to the order passed by the appropriate authorities under section 269UD(1) - submission of the appellants that the Central Government had not deposited or tendered the amount within the time required under section 269UF, is raised for the first time, hence rejected - appeal also dismissed
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2002 (12) TMI 6
Appellants' declarations which the appellants had filed under the "Kar Vivad Samadhan Scheme, 1998, was rejected - Since the appellant's case formally fulfilled the criteria for being considered under Chapter IV of the Finance (No. 2) Act, 1998 (, we set aside the order of the HC by which the declaration filed by the appellant under the Scheme was rejected - respondents are directed to consider the declaration filed by the appellant under section 88
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2002 (12) TMI 5
Whether, 50 per cent out of the assessee's ten per cent. right, title and interest in the partnership firm belongs to assessee's trust and the income arising therefrom belongs to the said trust by overriding title - appeal of revenue is allowed but tribunal is directed to refer above questions to HC
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2002 (12) TMI 4
Whether the deductions which are permissible under the provisions of the Act can be considered to have been actually allowed when the assessee has been made liable to pay (tax on) 30 % of its book profits in terms of s. 115J - revenue's contention that deductions not been actually allowed as claimed by the appellant, the assessee would not have been liable to pay only the tax on the book profit but tax on the actual income, is acceptable - held that there is no notional but actual deduction
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2002 (12) TMI 3
Central Excise – Manufacturer – Fabrication and assembly work – Appellant contended that fabrication and assembly work under the contract by M/s. Oilex Engineers (I) Pvt. Ltd., were the manufacturer of goods in question, hence demand of duty and penalty set aside
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2002 (12) TMI 2
Issues: Service tax non-payment on services provided to customers.
Analysis:
The appeal before the Appellate Tribunal CEGAT, Kolkata pertained to the alleged non-payment of service tax by the appellants on services provided to their customers. The period in dispute was from July 1994 to September 1998. The demand for service tax was based on a verification report of the Superintendent, indicating an amount of Rs. 15.51 crores, out of which approximately Rs. 8.31 crores belonged to cancelled bills and Rs. 7.20 crores was due to un-realized amounts from customers. The appellant's advocate argued that no service tax should be paid on cancelled bills as they were not realized, and tax liability only arises upon actual realization of consideration for services provided. Reference was made to Section 65(16) of the Finance Act, 1994, defining "taxable service," and Section 67 regarding the value of taxable services in relation to telephone connections provided to subscribers.
The advocate further highlighted that prior to August 1, 1998, the liability for service tax was limited to the amount "received" by the service provider, as per the Finance (No. 2) Act, 1998. Citing a Delhi-II Commissionerate's Trade Notice, it was argued that service tax is payable only on the value of taxable services relied upon during the period. Reference was also made to a Supreme Court decision emphasizing that service tax is leviable only on amounts actually received by the service provider. Regarding the tax demanded for July 1994, it was contended that no liability arose as the Finance Act, 1994 related to service tax was received after July 1, 1994, and there was no scope for levying service tax on rental in bills issued in July 1994.
Moreover, the advocate argued against the levy of service tax on surcharge collected for delayed payment on telephone bills, referring to a Board's Service Tax Circular. The imposition of personal penalty on the appellants and the confirmation of interest were also challenged. However, it was acknowledged that these issues were not raised before the Commissioner, warranting a remand of the matter to the original adjudicating authority for a fresh decision after considering the appellants' pleas. The appellants were granted an opportunity to present their case before the Commissioner and raise the aforementioned arguments. The appeal was disposed of accordingly.
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2002 (12) TMI 1
Issues Involved:
1. Imposition of Service Tax on services provided by goods transport operators.
2. Retrospective amendment of Service Tax Rules by Section 117 of the Finance Act, 2000.
3. Validity of Rule 2(1)(d)(xvii) of the Service Tax Rules, 1994.
4. Liability for registration and filing of returns under Sections 69 and 70 of the Finance Act, 1994.
5. Applicability of Section 117 of the Finance Act, 2000 for recovery of service tax.
6. Validity of show cause notices issued under Sections 76, 77, and 79 of the Finance Act, 1994.
7. Interpretation of Section 73 of the Finance Act, 1994 regarding issuance of show cause notices.
Detailed Analysis:
1. Imposition of Service Tax on services provided by goods transport operators:
The core issue revolves around the imposition of Service Tax on services provided by goods transport operators from 16-11-1997 to 1-6-1998. The appellants were required to pay service tax for the services availed during this period as they had neither registered with the Central Excise authorities nor paid the service tax, thus contravening Sections 68 and 70 of the Finance Act, 1994. The show cause notices also proposed recovery of interest for delayed payment and penal action under Sections 76, 77, and 79 of the Finance Act, 1994.
2. Retrospective amendment of Service Tax Rules by Section 117 of the Finance Act, 2000:
The retrospective amendment of Service Tax Rules by Section 117 of the Finance Act, 2000, validated the levy and collection of service tax on services rendered by goods transport operators. This amendment was made notwithstanding any judgment, decree, or order of any Court, Tribunal, or other authority. The Commissioner of Central Excise issued notices for revision of the Deputy Commissioner's orders in light of this retrospective amendment, directing the appellants to work out the tax payable and pay the same along with interest.
3. Validity of Rule 2(1)(d)(xvii) of the Service Tax Rules, 1994:
The validity of Rule 2(1)(d)(xvii) was challenged and quashed by the Supreme Court in the case of Laghu Udyog Bharti v. Union of India, declaring the Rule ultra vires. Consequently, the Deputy Commissioner dropped the show cause notices. However, the retrospective amendment by Section 117 of the Finance Act, 2000, reinstated the validity of the Rule, thus requiring the appellants to comply with the service tax obligations.
4. Liability for registration and filing of returns under Sections 69 and 70 of the Finance Act, 1994:
The appellants contended that Sections 69 and 70 were to be complied with only by the service provider and not by the service receiver. However, the Tribunal clarified that the person responsible for collecting the service tax, as defined in Rule 2(1)(d)(xvii), includes the service receiver who pays or is liable to pay the freight. Therefore, the appellants were liable to apply for registration and file returns.
5. Applicability of Section 117 of the Finance Act, 2000 for recovery of service tax:
The Tribunal referred to the decision in Apollo Tyres Ltd. v. CCE, which held that Section 117 of the Finance Act, 2000, validates any action taken or anything done during the specified period and provides for recovery of service tax refunded in pursuance of any judgment or order. The argument that Section 117 only validates collections already made and does not authorize recovery of tax was rejected.
6. Validity of show cause notices issued under Sections 76, 77, and 79 of the Finance Act, 1994:
The Tribunal noted that the show cause notices were issued under Sections 76, 77, and 79 for non-compliance with registration and filing of returns, but not under Section 73 for non-payment of service tax. This distinction was crucial in determining the validity of the notices and the subsequent orders for recovery of service tax.
7. Interpretation of Section 73 of the Finance Act, 1994 regarding issuance of show cause notices:
The Tribunal referred to the decision in Markfed Oil & Allied Industries v. CCE, which held that a show cause notice must be issued under Section 73 for recovery of service tax if the value of taxable service has escaped assessment due to omission or failure to file returns. Since the notices in the present cases were issued only under Sections 76, 77, and 79, and not under Section 73, the Tribunal set aside the impugned orders-in-revision and allowed the appeals.
Conclusion:
The appellants were held liable to apply for registration and file returns. However, the demand for service tax was set aside due to the lack of proper show cause notices under Section 73 of the Finance Act, 1994. The appeals were allowed, and the impugned orders-in-revision were set aside.
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2002 (11) TMI 818
1. ISSUES PRESENTED and CONSIDERED The core legal questions considered by the Tribunal in this appeal are: (a) Whether the disallowance of rent amounting to Rs. 24,000 paid by the assessee to M/s. Kesraj for office premises was justified, given the relationship between the parties and the reasonableness of the rent charged. (b) Whether the disallowance of cultivation expenses amounting to Rs. 2,35,534 claimed by the assessee was justified, particularly in light of the significant increase in expenditure per kilogram of tea produced compared to the preceding year, and the adequacy of the explanation provided by the assessee. 2. ISSUE-WISE DETAILED ANALYSIS (a) Disallowance of Rent of Rs. 24,000 Relevant legal framework and precedents: The assessment of rent expenses involves examination of whether the expenditure is wholly and exclusively for business purposes and whether the amount charged is reasonable. The burden lies on the Revenue to establish that the rent paid is excessive or unreasonable, especially when related parties are involved. Court's interpretation and reasoning: The Assessing Officer disallowed Rs. 24,000 on the ground that the rent paid by the assessee to M/s. Kesraj was excessive and unreasonable, noting that M/s. Kesraj, which shares partners with the assessee, paid only Rs. 550 per month to the landlord for the entire premises, whereas the assessee paid Rs. 3,500 per month for a small portion of the premises. The Assessing Officer treated this as an attempt to divert income to reduce tax liability. The learned CIT(A) reversed this disallowance, accepting the assessee's submission that M/s. Kesraj is a separate entity with different partners and that the premises is located at a prime market road, rented at Rs. 42,000 per annum since 1987. The CIT(A) noted that no such disallowance had been made in previous assessments and that the rent income was already declared and taxed in the hands of M/s. Kesraj. Key evidence and findings: The Tribunal examined the assessment order for the preceding year (1989-90) and found no disallowance of rent. It was also observed that M/s. Kesraj had declared the rental income, which was taxed accordingly. No material was produced by the Revenue to challenge these findings. Application of law to facts: Since the rent was paid to a related but separate entity, the income was declared and taxed in that entity's hands, and the rent was consistent with prior years without objection, the Tribunal held that the disallowance by the Assessing Officer was not justified. Treatment of competing arguments: The Revenue argued that the rent was excessive and a device to divert income, but failed to produce evidence to rebut the assessee's claim of separate entities and consistent prior treatment. The assessee's argument that the rent was reasonable and previously accepted was upheld. Conclusions: The Tribunal upheld the order of the CIT(A) deleting the disallowance of Rs. 24,000 rent paid by the assessee. (b) Disallowance of Cultivation Expenses of Rs. 2,35,534 Relevant legal framework and precedents: Under the Income-tax Act, expenses must be incurred wholly and exclusively for the purpose of business to be allowable. Reasonableness of expenditure may be relevant but the Revenue cannot substitute its judgment for that of the businessman unless there is evidence of impropriety. The Tribunal relied on precedents including CIT v. Raman & Raman, Sanker Trading v. State of Tripura, Steal Worth Ltd. v. CIT, and Aluminium Industries (P.) Ltd. v. CIT, which emphasize the primacy of genuine accounts and the limited scope of Revenue to disallow expenses without specific evidence. Court's interpretation and reasoning: The Assessing Officer disallowed 60% of the increase in cultivation expenses over the previous year, reasoning that the increase was excessive (80% increase in per kg cost versus a 10-15% increase in wages and related expenses), and thus unreasonable. The assessee explained that cultivation expenses vary due to factors like soil condition, climatic variations, pest infestation, and that production quantity is beyond control. The CIT(A) deleted the addition, noting that no defect or irregularity in the accounts was pointed out by the Assessing Officer and that all expenses were related to the business. Key evidence and findings: The assessee's accounts were audited and accompanied by a tax audit report. The books of account were maintained regularly with proper vouchers and registers, and the business was subject to excise duty, mandating detailed record-keeping. The Assessing Officer did not challenge the genuineness or completeness of the accounts but only questioned the reasonableness of the increase in expenditure. Application of law to facts: The Tribunal emphasized that once the nexus between expenditure and business is established and the accounts are genuine, the Revenue cannot disallow expenses based on its own assessment of reasonableness without specific evidence. The Tribunal also noted that agricultural and cultivation expenses are subject to natural variations and cannot be rigidly compared year to year. Treatment of competing arguments: The Revenue relied on the disproportionate increase in expenses to production ratio and argued for disallowance. The assessee countered with explanations of natural factors affecting cultivation costs, supported by audited accounts and legal precedents restricting Revenue's power to disallow expenses without concrete evidence. The Tribunal found the assessee's arguments more persuasive. Conclusions: The Tribunal upheld the deletion of the disallowance of Rs. 2,35,534 cultivation expenses by the CIT(A), dismissing the Revenue's appeal on this ground. 3. SIGNIFICANT HOLDINGS The Tribunal established the following core principles and determinations: "If the books of account are not challenged those books of accounts should be considered as genuine." "The accounts are relevant and afford prima facie proof of the entries and the correctness thereof under section 34 of the Evidence Act." "The jurisdiction of the revenue authorities is confined to deciding the reality of the expenditure incurred i.e., whether the amount was actually expended or laid out wholly and exclusively for the purposes of the business. Reasonableness of the expenditure can be considered only for the purpose of determining the fact of the amounts spent." "The Revenue cannot put itself in the armchair of a businessman and assume the role of ascertaining how much is a reasonable expenditure having regard to the circumstances of the case." "No material was brought before us to show that the cultivation expenses has to be in direct proportion with the actual production of the agricultural produce and that proportion remain static year after year." On the rent issue, the Tribunal concluded that the rent paid to a related but separate entity, which declared and paid tax on the rental income, could not be disallowed merely on the basis of relationship or alleged diversion without evidence. On the cultivation expenses issue, the Tribunal concluded that the Assessing Officer's disallowance based on the increase in expenditure ratio was not justified in the absence of any defect in accounts or evidence of non-business expenditure. Accordingly, the Tribunal dismissed the Revenue's appeal on both grounds and upheld the order of the first appellate authority.
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2002 (11) TMI 817
In the Supreme Court case cited as 2002 (11) TMI 817 - SC Order, presided over by Hon'ble Mrs. Justice Ruma Pal and Hon'ble Mr. Justice B.N. Srikrishna, the Court addressed procedural matters involving the petitioner and respondent. Representing the petitioner were Mr. Soli J. Sorabjee, A.G., and others, while Mr. Prashant Bhushan and others represented the respondent.The Court issued several key orders:1. **Notice Issuance**: The Court directed the issuance of a notice, with respondents accepting and committing to file counter-affidavits within three weeks. The petitioner may file a rejoinder within the same timeframe.2. **Stay Order**: The Court granted a stay on the impugned judgments pending further proceedings.3. **Special Leave Petition**: Notice was issued regarding the application for permission to file a special leave petition.4. **Scheduling**: The matter was scheduled to be revisited eight weeks later.These orders reflect the Court's procedural management in handling the appeal process and ensuring timely submissions from both parties.
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2002 (11) TMI 816
Issues Involved:
1. Validity of the dismissal order dated 26.7.1985.
2. Compliance with principles of natural justice during the enquiry process.
3. Opportunity for the petitioner to cross-examine witnesses.
4. Provision of necessary documents to the petitioner.
5. Admission of guilt by the petitioner.
6. Reinstatement and back wages.
Detailed Analysis:
1. Validity of the dismissal order dated 26.7.1985
The special appeal was filed against the judgment of the learned single Judge dated 11.10.1999, which dismissed the writ petition challenging the dismissal order dated 26.7.1985. The petitioner, a cashier, was dismissed based on a charge-sheet dated 3.2.1985. The High Court scrutinized whether the dismissal was lawful and whether due process was followed.
2. Compliance with principles of natural justice during the enquiry process
The court emphasized the necessity of an oral enquiry before imposing a major punishment like dismissal. The law mandates that after a charge-sheet is issued, an oral enquiry must be conducted, and the employee must be given notice of the date, time, and place of the enquiry. The employer must lead oral and documentary evidence against the employee in the latter's presence. This principle ensures the employee knows the charges and evidence against him to properly respond.
3. Opportunity for the petitioner to cross-examine witnesses
The court found that the enquiry officer called the petitioner for personal hearing without first examining the witnesses against him in his presence. The statement of Hanuman Saran, the driver, was recorded behind the petitioner's back, and the petitioner was not allowed to inspect the written report of Najib Ahmad. The petitioner was not given the opportunity to cross-examine the witnesses, which is a violation of the principles of natural justice.
4. Provision of necessary documents to the petitioner
It was alleged and not denied that the petitioner was not supplied with the report of Najib Ahmad dated 30.1.1985. This omission further violated the principles of natural justice as the petitioner was deprived of the chance to use the report in his defense.
5. Admission of guilt by the petitioner
The respondent's counsel argued that the petitioner admitted his guilt. However, the court found no evidence of such an admission. The petitioner consistently contended that the guilt lay with Najib Ahmad. The letter dated 9.2.1985 (Annexure-4) did not constitute an admission of guilt.
6. Reinstatement and back wages
The court concluded that the dismissal order dated 26.7.1985 was illegal due to the lack of a proper oral enquiry and the violation of natural justice principles. Consequently, the dismissal order and the judgment of the learned single Judge dated 11.10.1999 were set aside. The court directed the petitioner's reinstatement with full back wages from the date of dismissal to the date of reinstatement, along with interest at 10% per annum.
Conclusion:
The High Court quashed the dismissal order dated 26.7.1985 and set aside the judgment of the learned single Judge dated 11.10.1999. The court ordered the petitioner's reinstatement with full back wages and interest due to the failure to conduct a proper enquiry and the violation of natural justice principles.
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2002 (11) TMI 815
The Supreme Court upheld an order for re-trial by a fresh General Security Force Court under Section 71(3) of the Border Security Forces Act. The appellant's challenge was dismissed as the dissolution of the court was based on his own complaint of unfair treatment by the Law Officer. The court found no error in the order, stating that the authorities were within their rights to issue it. The appeal was dismissed.
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2002 (11) TMI 814
Issues Involved:
1. Deletion of names of defendant Nos. 5, 6, 7, and 8 from the plaint and proceedings.
2. Allegations of sexual harassment by defendant No. 2.
3. Responsibility and authority of defendant Nos. 5 to 8 to act on the plaintiff's complaints.
4. Applicability of Order 1, Rule 10(2) of the Code of Civil Procedure, 1908.
5. Suppression of material facts by the plaintiff.
6. The plaintiff's conduct and its impact on the proceedings.
Issue-Wise Detailed Analysis:
1. Deletion of Names of Defendant Nos. 5, 6, 7, and 8:
The Chamber Summons sought to have the names of defendant Nos. 5, 6, 7, and 8 deleted from the plaint and proceedings. The court decided to dismiss the Chamber Summons despite agreeing with the submissions of the learned counsel for defendant Nos. 5 to 8 on merits. The decision was based on the limited scope of Order 1, Rule 10(2) of the Code of Civil Procedure, 1908.
2. Allegations of Sexual Harassment by Defendant No. 2:
The plaintiff's main grievance was against defendant No. 2 regarding their personal relationship, which had no connection with defendant No. 1 or defendant No. 8. The plaintiff alleged that from March 1997, defendant No. 2's conduct became nasty and unprofessional. From May 1999, defendant Nos. 3 and 4, upon instructions from defendant No. 2, continuously harassed her. The plaintiff detailed various instances of harassment, including verbal abuse, ridicule, unwarranted sexual advances, and withholding salary.
3. Responsibility and Authority of Defendant Nos. 5 to 8:
The plaintiff reported the conduct of defendant Nos. 2 to 4 to defendant Nos. 5, 6, and 7, who were part of the senior management of defendant No. 8. The plaintiff alleged that defendant Nos. 5 to 8 did not prevent the ongoing harassment despite having the authority and power to do so. The plaintiff further stated that defendant Nos. 5 to 8 ratified the harassment by not taking disciplinary action against defendant Nos. 2, 3, and 4.
4. Applicability of Order 1, Rule 10(2) of the Code of Civil Procedure, 1908:
The court discussed the applicability of Order 1, Rule 10(2), which allows the court to strike out the name of any party improperly joined. The court noted that if a particular defendant has no connection with the cause of action pleaded against the other defendants, they are entitled to have their name struck out. However, the court must presume that the facts stated in the plaint are correct and act with great circumspection and restraint while considering such an application.
5. Suppression of Material Facts by the Plaintiff:
The court noted that the plaintiff had suppressed material information, such as the transcript of certain telephonic conversations/messages left by the plaintiff on defendant No. 2's recording machine. The court observed that suppression of material facts is not relevant while deciding an application under Order 1, Rule 10(2). It may disentitle the plaintiff to interim reliefs or entail the dismissal of the suit but does not entitle defendant Nos. 5 to 8 to succeed in their Chamber Summons.
6. The Plaintiff's Conduct and Its Impact on the Proceedings:
The court observed that the plaintiff's conduct, as evidenced by the transcripts, indicated an attempt to disrupt and destroy the functioning of defendant Nos. 1 and 8 and to harass their officers to settle her personal dispute with defendant No. 2. The court found that defendant Nos. 5 to 8 had been unnecessarily dragged into the litigation and that the plaint appeared to be a case of clever drafting to bring the case within the directions of the Supreme Court in Vishaka's case. However, the court emphasized that the remedy for defendant Nos. 5 to 8 lies in having the suit dismissed after an adjudication on merits.
Conclusion:
The Chamber Summons were dismissed, and the court emphasized that the plaintiff should be given an opportunity to go to trial. The court noted that while the suit appeared to be a misuse of the law, the remedy for defendant Nos. 5 to 8 was to have the suit dismissed after a trial on merits. The court also highlighted the importance of an activist judge in addressing irresponsible lawsuits and the potential for dismissing a suit under Order X of the Civil Procedure Code if it does not disclose a clear right to sue.
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9911796707
