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2008 (3) TMI 772
Issues Involved:
1. Coercion and Threats to Witnesses
2. Impartiality of Investigating Agency and Public Prosecutor
3. Fair Trial and Judicial Conduct
4. Transfer of Case for Fair Trial
Summary:
1. Coercion and Threats to Witnesses:
The petitioner, Himanshu Singh Sabharwal, alleged that witnesses in the trial of the murder of his father, Prof. H.S. Sabharwal, were coerced and threatened, leading to them resiling from their statements made during the investigation. This included three police witnesses, Dhara Singh (PW-32), Sukhnandan (PW-33), and Dilip Tripathi (PW-34).
2. Impartiality of Investigating Agency and Public Prosecutor:
The petitioner raised concerns about the impartiality and sincerity of the investigating agency and the public prosecutor. It was highlighted that the public prosecutor did not cross-examine the witnesses who resiled from their statements, indicating a lack of effort to ensure justice.
3. Fair Trial and Judicial Conduct:
The judgment emphasized the principles of a fair trial, stating that the trial should be a search for the truth and not a bout over technicalities. It stressed that the presiding judge must actively participate in the trial to elicit all relevant materials necessary for reaching the correct conclusion. The court also noted the importance of protecting witnesses from threats and coercion to ensure they can safely depose the truth.
4. Transfer of Case for Fair Trial:
The State of M.P., represented by Mr. Soli J. Sorabjee, agreed to the transfer of the case to another state in the interest of justice and transparency, without accepting the allegations of partiality. The Supreme Court directed that Sessions Case No. 291 of 2006 be transferred to the Court of Sessions Judge, Nagpur, Maharashtra. The trial would resume from the stage it was at when the stay order was passed. The petitioner and the respondent-State were permitted to suggest two names each for the appointment of a public prosecutor, with the final decision to be made by the Sessions Judge, Nagpur. The fees and expenses of the public prosecutor would be borne by the State of M.P. The public prosecutor could seek the recall of any witness already examined u/s 311 of the Code of Criminal Procedure, 1973.
Conclusion:
The Transfer Petition was disposed of, and no further order was necessary in W.P.(Crl.) 173 of 2006, which was also disposed of accordingly.
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2008 (3) TMI 771
Issues involved:
The case involves issues related to the premature suspension and non-retirement of a Deputy Superintending Engineer, the delay in completing disciplinary proceedings, the failure to pass final orders, and the legality of the impugned orders.
Premature Suspension and Non-Retirement:
The appellant, a Deputy Superintending Engineer, was suspended and not allowed to retire despite reaching the age of superannuation, based on charges related to irregularities from 1982 to 1985. The suspension and non-retirement were challenged through writ petitions due to delays in completing the disciplinary proceedings.
Delay in Disciplinary Proceedings:
Disciplinary proceedings were initiated in 1988, but delays occurred in completing the enquiry and passing final orders. Despite court directions to conclude the enquiry within specified time frames, the proceedings were prolonged, leading to further complications.
Legality of Impugned Orders:
The High Court found that the impugned orders, which prevented the appellant from retiring and continued the suspension, were contrary to government regulations and court directives. The court set aside the impugned orders and allowed the writ appeal, emphasizing the need for timely completion of disciplinary proceedings and adherence to legal guidelines.
Conclusion:
The High Court ruled in favor of the appellant, setting aside the impugned orders and allowing the writ appeal. The court highlighted the importance of timely completion of disciplinary proceedings and compliance with relevant regulations and court directives.
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2008 (3) TMI 770
Issues Involved:
1. Jurisdiction of the Delhi Court to entertain the suit.
2. Specific performance of the contract for sale of immovable property.
3. Interpretation and application of Section 16 of the Code of Civil Procedure (CPC) and Section 22 of the Specific Relief Act.
Detailed Analysis:
Jurisdiction of the Delhi Court to Entertain the Suit:
The primary issue in these appeals is whether the Delhi Court has the jurisdiction to entertain the suit instituted by the respondent. The respondent claimed that the Delhi Court has jurisdiction because the corporate office of the defendants is in Delhi, the offer and acceptance of the sale happened in Delhi, and payments were made in Delhi. The respondent sought specific performance of a contract dated 16/20.01.2004 for the sale of commercial property in Gurgaon.
The appellants contested this claim, arguing that the suit property is situated in Gurgaon, and the defendants now carry on business in Gurgaon. They asserted that the courts in Gurgaon alone have jurisdiction to try the suit, as the suit property is located there.
Specific Performance of the Contract for Sale of Immovable Property:
The respondent-plaintiff sought a decree for specific performance, commanding the defendants to transfer the right, title, and interest in the suit premises by executing and registering the sale deed. The respondent did not pray for delivery of possession of the suit property. The appellants argued that a decree for specific performance inherently includes delivery of possession, especially when the possession is with the vendor.
Interpretation and Application of Section 16 of the CPC and Section 22 of the Specific Relief Act:
The learned Single Judge held that since only a declaration of right and title was sought and not delivery of possession, the Delhi Court had jurisdiction. The Judge distinguished between a suit for specific performance of a contract for sale of immovable property and a suit where additional relief for delivery of possession is prayed for. The Judge referred to several judgments, including *Sidharth Choudhary v. Mahamaya General Finance*, *Karan Mahendru and Anr. v. Vatika Plantations (P) Ltd.*, *Adcon Electronics Pvt. Ltd. v. Daulat and Anr.*, and *Babu Lal v. Hazari Lal Kishori Lal and Ors.*
Section 16(d) of the CPC states that suits related to immovable property should be instituted in the court within the local limits where the property is situated. The proviso allows for suits to be instituted where the defendant resides or carries on business if the relief can be entirely obtained through personal obedience. Section 22 of the Specific Relief Act allows for additional reliefs like possession to be claimed in suits for specific performance.
The Supreme Court in *Babu Lal v. Hazari Lal Kishori Lal and Ors.* held that possession is incidental to specific performance, and the seller must deliver possession upon execution of the sale deed. The Supreme Court in *Harshad Chiman Lal Modi v. DLF Universal Limited* emphasized that suits involving immovable property must be filed where the property is located.
The Delhi High Court, in this case, found that the relief sought could not be entirely obtained through the personal obedience of the defendants, as the execution and registration of the sale deed would have to take place in Gurgaon. Therefore, the proviso to Section 16 CPC was not applicable.
The Court also referred to the Supreme Court decision in *Begum Sabiha Sultan v. Nawab Mohd. Mansur Ali Khan and Ors.*, which held that suits involving immovable property outside the court's jurisdiction could not be entertained based on the personal obedience of the defendants.
Conclusion:
The Delhi High Court concluded that it did not have territorial jurisdiction to entertain and decide the suit. The decision of the learned Single Judge was set aside, and the appeals were allowed. The plaint was ordered to be returned to the plaintiff for filing in the appropriate jurisdiction.
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2008 (3) TMI 769
Issues Involved:
1. Legality of the notice issued u/s 6 of the Act.
2. Requirement of serving notice on the convict.
3. Consideration of the Income Tax Officer's report by the Appellate Tribunal.
4. Justification for rejecting materials indicating lawful acquisition of property.
5. Basis of conclusions by the authorities.
6. Impact of setting aside the order u/s 7 against the convict on the forfeiture of properties.
Summary:
1. Legality of the notice issued u/s 6 of the Act:
The petitioners contended that the notice issued u/s 6 of the Act was illegal as it did not disclose the reason for the proposed forfeiture and did not allege the existence of any nexus between the property sought to be forfeited and the convict.
2. Requirement of serving notice on the convict:
The court noted that the primary notice u/s 6(1) is intended to be served on the convict, requiring them to indicate the sources of their income, earnings, or assets. In this case, no notice was served on the convict, which was a jurisdictional defect, rendering the proceedings vitiated. The court emphasized that the procedure must be strictly followed as per the statute.
3. Consideration of the Income Tax Officer's report by the Appellate Tribunal:
The petitioners argued that the Appellate Tribunal acted illegally by ignoring the report of the Income Tax Officer, which was sought and secured by the competent authority.
4. Justification for rejecting materials indicating lawful acquisition of property:
The petitioners provided voluminous materials indicating their own income, accepted and assessed by the Income Tax Authorities from 1950 onwards. The court found that the Appellate Tribunal unjustifiably rejected these unrebutted materials, which indicated that the properties were acquired from lawful business activities.
5. Basis of conclusions by the authorities:
The petitioners contended that the conclusions of both authorities were based on surmises and conjectures, ignoring various materials produced on behalf of the petitioner. The court agreed that the authorities' orders were vitiated by non-application of mind.
6. Impact of setting aside the order u/s 7 against the convict on the forfeiture of properties:
The petitioners argued that since the order u/s 7 against the convict regarding the gold ornaments was set aside, there was no material to indicate that the property was held by the convict either directly or through a relative.
Conclusion:
The court quashed the orders passed by the authorities due to the jurisdictional defect of not serving notice u/s 6(1) on the convict. The court left open the question of whether notice u/s 6(1) can be issued to the legal representatives after the convict's death, allowing the authorities to initiate fresh proceedings if advised. The writ petitions were allowed, and no costs were imposed.
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2008 (3) TMI 768
Issues involved:
Challenge to judgment quashing criminal proceedings u/s 482 Cr.P.C.
Background:
- Appellant married respondent No. 3 and alleged harassment for dowry.
- FIR registered for offenses u/s 498A IPC and Dowry Prohibition Act.
- Various complaints and legal actions ensued.
- Maintenance granted to appellant in matrimonial suit.
- Dispute over maintenance led to filing of discharge application u/s 239 Cr.P.C.
- Sessions Judge and High Court dismissed revision and accepted petition u/s 482 Cr.P.C.
Judgment Analysis:
- Learned Single Judge quashed proceedings citing malicious intent and private grudge.
- Appellant argued that parameters of u/s 482 Cr.P.C. not considered.
- Highlighted dismissal of matrimonial suit before High Court judgment.
- Emphasized that u/s 482 Cr.P.C. is an exception, not the rule, and must prevent abuse of process.
- Quoting R.P. Kapur v. State of Punjab, outlined categories for quashing proceedings.
- Cautioned against misuse of power to stifle legitimate prosecution.
- Reiterated that mala fides of informant are secondary to evidence collected during investigation.
- Cited precedents to support the position of law.
Conclusion:
- Impugned order deemed indefensible and set aside.
- Appeal allowed without costs.
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2008 (3) TMI 767
Issues Involved:
The issues involved in the judgment are the redemption of a mortgage, the status of the appellant as a tenant or mortgagee, the validity of an unregistered deed of lease, and the alteration of terms of a registered mortgage by an unregistered document.
Redemption of Mortgage:
The appellant owned a property under a mortgage that was to expire after seven years. The respondents, as predecessors of the mortgagor, filed a suit for redemption after the specified period. The trial court initially dismissed the suit, but the Court of Appeal allowed it, holding that the right created in favor of the defendant as a mortgagee could not be extinguished by an unregistered deed of lease. The appellant's appeal was dismissed by the High Court.
Status of Appellant - Tenant or Mortgagee:
The appellant contended that he was a tenant due to a separate agreement, while the respondents argued that the relationship was that of a mortgagor and mortgagee. The Court of First Appeal held that the appellant failed to prove his status as a tenant and was, in fact, a mortgagee. The High Court upheld this decision, stating no substantial question of law arose.
Validity of Unregistered Deed of Lease:
The Court of Appeal found that the unregistered deed of lease could not extinguish the mortgage rights created by the registered mortgage deed. The appellant's attempt to change his status from a mortgagee to a lessee through the unregistered lease was deemed impermissible in law. The terms of a registered document could only be altered by another registered document.
Alteration of Terms of Registered Mortgage:
The judgment emphasized that the terms of a registered mortgage could not be varied by an unregistered document. The appellant's attempt to change his status from a mortgagee to a lessee through an unregistered deed of lease was legally invalid. The High Court dismissed the appeal, finding no merit in the appellant's arguments.
Conclusion:
The Supreme Court dismissed the appeal, upholding the decisions of the lower courts. It was held that the appellant's attempt to change his status from a mortgagee to a lessee through an unregistered deed of lease was impermissible in law. The terms of a registered mortgage could not be altered by an unregistered document.
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2008 (3) TMI 766
Issues Involved:
1. Validity of notice under Section 158BD.
2. Satisfaction note and its timing.
3. Validity of block assessment order.
4. Addition of undisclosed income.
Issue-wise Detailed Analysis:
1. Validity of Notice under Section 158BD:
The assessee challenged the notice under Section 158BD on the grounds that it was undated and did not indicate the material or basis on which it was issued. The notice failed to specify the person in whose case the search was conducted and the material found during the search. It was argued that the notice was vague and issued without application of mind. The Tribunal found that the notice did not meet the requirements of law as it did not record the satisfaction of the AO nor other necessary details, making it invalid. This conclusion was supported by precedents from the Supreme Court and the Delhi High Court, which emphasized the need for a detailed and specific notice to initiate proceedings under Section 158BD.
2. Satisfaction Note and Its Timing:
The assessee argued that the satisfaction note was recorded on 19th Dec., 2002, which was after the completion of the assessment order in the case of Manoj Aggarwal on 29th Aug., 2002. The Tribunal examined the satisfaction note and found that it was indeed dated 19th Dec., 2002, indicating that the AO's decision to initiate action under Section 158BD against the assessee was made after the assessment in the case of Manoj Aggarwal. This was contrary to the requirement that satisfaction should be recorded before completing the assessment in the case of the searched person. The Tribunal also noted that the Department failed to produce the proposal for centralizing the case and the approval granted, leading to an adverse inference against the Department.
3. Validity of Block Assessment Order:
The Tribunal quashed the block assessment order under Section 158BD on the grounds that the satisfaction note was recorded after the completion of the assessment in the case of the searched person, and the notice issued was vague and showed non-application of mind. The Tribunal held that such a notice could not form a legal foundation for initiating proceedings under Section 158BD. This decision was based on the Supreme Court's ruling in the case of Manish Maheshwari and the Delhi High Court's decision in New Delhi Auto Finance (P) Ltd.
4. Addition of Undisclosed Income:
Although the assessment order was quashed on legal grounds, the Tribunal also examined the merits of the addition made by the AO. The AO had added Rs. 2,47,31,304 as undisclosed income based on the statement of Manoj Aggarwal and the examination of transactions. However, the Tribunal found that no incriminating material was found during the search relating to the assessee, and the transactions were duly recorded in the books of account. The CIT(A) had already deleted the addition on merits, and the Tribunal upheld this decision, finding no scope to interfere.
Conclusion:
The cross-objection filed by the assessee was allowed, and the appeal of the Revenue was dismissed. The Tribunal quashed the assessment order under Section 158BD due to the invalidity of the notice and the improper recording of the satisfaction note. The addition of undisclosed income was also found to be unjustified on merits.
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2008 (3) TMI 765
Issues involved:
Challenge to order under Order VII Rule 11 CPC
Summary:
The appeal challenged the order dismissing the application filed by NTPC under Order VII Rule 11 CPC in a suit by IDBI against various parties including NTPC. The suit challenged a compromise agreement between SPGL and NTPC, alleging it was contrary to loan agreements with financial institutions. The appeal contended no cause of action was disclosed in the plaint.
Background Facts:
Financial assistance was provided to SPGL by financial institutions, governed by loan agreements. Disputes arose among promoters, leading to suits. A compromise agreement was reached between SPGL and NTPC, contested by IDBI. Supreme Court noted challenges could be raised regarding SPGL's authority to make payments to NTPC.
Contentions:
Appellant argued Lenders/Financial Institutions had no connection to the compromise agreement. IDBI lacked cause of action against NTPC. Settlement did not affect company's capital structure. NTPC entered into the settlement at IDBI's insistence. IDBI contended Lenders/Financial Institutions were vitally concerned by SPGL's payment to settle disputes.
Judgment:
Court found the settlement by SPGL with NTPC for loss of opportunity cost was of vital interest to Lenders/Financial Institutions. Payment disturbed debt equity ratio, making IDBI a vital stakeholder. Court held the suit had cause of action as disputes required adjudication. Rejection of plaint based on lack of cause of action is not warranted if some cause of action is disclosed. Weakness of case is not a ground for rejection.
Conclusion:
The appeal was dismissed as the suit had cause of action and required trial. The learned Single Judge's decision to dismiss the application was upheld.
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2008 (3) TMI 764
Issues Involved:
1. Justification of the High Court's view on the breach of principles of natural justice by AAIFR.
2. Validity and implications of the bipartite agreement between the workers' union and Jaipur Udyog Limited (JUL).
3. The necessity and implications of remanding the matter to AAIFR.
4. Determination of the lawful dues of the workmen.
5. Consideration of creditors' claims and interests.
Detailed Analysis:
1. Justification of the High Court's view on the breach of principles of natural justice by AAIFR:
The High Court set aside the AAIFR's orders dated August 3, 2001, and September 6, 2001, on the grounds that the AAIFR dismissed the appeal without giving JUL a reasonable opportunity of hearing, thus violating the principles of natural justice. The High Court emphasized the importance of the rule of "audi alteram partem" (the right to be heard) and concluded that the AAIFR's refusal to grant an adjournment and subsequent dismissal of the appeal without hearing JUL was unjust.
2. Validity and implications of the bipartite agreement between the workers' union and Jaipur Udyog Limited (JUL):
During the pendency of the appeal, a bipartite agreement was reached between the workers' union (Cement Workers Karamchari Sangh) and JUL to settle the workers' dues. This agreement was contested by other workers' unions, alleging it was fraudulent and collusive. The Supreme Court noted that a significant number of workers had accepted payments under the settlement, but there were disputes about its fairness and compliance with statutory provisions.
3. The necessity and implications of remanding the matter to AAIFR:
The Supreme Court acknowledged the delays caused by the prolonged litigation and the hardships faced by the workers and creditors. However, it emphasized the need to ensure that justice is not only done but also appears to be done. Therefore, the Court directed the matter to be remitted to the AAIFR for a fresh hearing, provided JUL deposits Rs. 10 crores within two months. This would allow JUL an opportunity to present its case and potentially submit a revised rehabilitation scheme.
4. Determination of the lawful dues of the workmen:
The Supreme Court appointed Mr. Justice N.N. Mathur as an arbitrator to determine the lawful dues of the workmen employed at various locations of JUL. Justice Mathur was tasked with considering legal provisions, existing settlements, and determining the dues of individual workmen and the total dues. This determination was deemed essential for factoring into any realistic revival scheme or winding-up process.
5. Consideration of creditors' claims and interests:
Several creditors, including government departments and statutory bodies, opposed the settlement and supported the winding-up order. The Supreme Court recognized the substantial dues owed to these creditors and the importance of addressing their claims. The Court's directions aimed to balance the interests of the creditors, workmen, and the company's potential for revival.
Conclusion:
The Supreme Court's judgment aimed to address the procedural and substantive issues raised by the parties, ensuring a fair hearing for JUL while considering the interests of the workmen and creditors. The matter was remitted to the AAIFR for a fresh decision, with specific directions for the determination of workmen's dues and the potential submission of a revised rehabilitation scheme. The Court's decision sought to expedite the resolution of the long-standing disputes and provide a just outcome for all parties involved.
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2008 (3) TMI 763
Issues involved: Appeal against order of acquittal in a prosecution u/s 138 of the Negotiable Instruments Act based on conflicting interpretations of the legal requirements for dishonor of a cheque.
Summary:
The appeal was filed by the complainant against the order of acquittal by the trial court in a case u/s 138 of the Negotiable Instruments Act. The complainant alleged that the accused issued a cheque in discharge of a debt, but the cheque bounced due to insufficient funds. The trial court acquitted the accused stating that the cheque did not represent a legally recoverable amount. The complainant argued that the cheque amount should be considered after deducting any payments made towards the liability. The defense cited a different judgment emphasizing that the cheque amount cannot exceed the liability incurred. There was a conflict in the interpretations of the law, leading to the decision that the appeal should be heard by a Division Bench for resolution. The matter was referred to the Chief Justice for further action.
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2008 (3) TMI 762
Issues Involved:
1. Treatment of Sales Tax Subsidy as Capital or Revenue Receipts.
2. Disallowance of Depreciation on Building Not Registered in Assessee's Name.
3. Disallowance of Depreciation on Power Lines Not Owned by Assessee.
4. Reduction of Synchronization Charges from Profits for Deduction u/s 80-IA.
5. Addition of Provision for Doubtful Debts for Computing Book Profit for MAT.
6. Non-Reduction of Book Profits by Amount of Profit from Export Business u/s 80 HHC.
7. Direction to Reduce Cost of Acquisition of Assets u/s 43(1).
Summary:
1. Treatment of Sales Tax Subsidy as Capital or Revenue Receipts:
The issue pertains to whether the Sales Tax Subsidy of Rs. 61,86,51,505/- should be treated as capital receipts or revenue receipts. The CIT(A) deleted the addition made by the Assessing Officer, treating it as capital receipts based on earlier ITAT orders in the assessee's own case. The Tribunal upheld the CIT(A)'s decision, referencing the Special Bench decision in DCIT Vs. Reliance Industries Ltd. (2004) 88 ITD 273, concluding the issue against the department.
2. Disallowance of Depreciation on Building Not Registered in Assessee's Name:
The assessee claimed depreciation on assets not registered in its name. The CIT(A) allowed the claim, following the ITAT's decisions in the assessee's own case for earlier years and the Supreme Court rulings in Poddar Cement Ltd. 226 ITR 625 and Mysore Minerals Ltd. 239 ITR 775. The Tribunal found no error in CIT(A)'s decision and upheld it.
3. Disallowance of Depreciation on Power Lines Not Owned by Assessee:
The AO disallowed depreciation of Rs. 8,06,020/- on power lines not owned by the assessee. The CIT(A) upheld the disallowance, referencing ITAT's earlier decision. The Tribunal, following the same rationale, upheld the CIT(A)'s order, noting the ownership of power lines vested with U.P. State Electricity Board.
4. Reduction of Synchronization Charges from Profits for Deduction u/s 80-IA:
The AO reduced synchronization charges from profits for computing deduction u/s 80-IA, considering it an ascertained liability. The CIT(A) upheld this view. The Tribunal agreed, stating the liability had crystallized during the relevant year, and directed the AO to verify the debit to the P&L A/c.
5. Addition of Provision for Doubtful Debts for Computing Book Profit for MAT:
The AO added Rs. 2,17,512/- for provision of doubtful debts while computing book profit for MAT. The CIT(A) deleted the addition, and the Tribunal upheld this decision, referencing its earlier order which found such provisions based on actual ascertained liability.
6. Non-Reduction of Book Profits by Amount of Profit from Export Business u/s 80 HHC:
The AO did not reduce Rs. 37,21,57,582/- from book profits, claimed under section 80 HHC. The CIT(A) upheld this action. The Tribunal found no infirmity in CIT(A)'s order, following the Mumbai High Court's decision in ACIT Vs. Ajanta Pharma Ltd. (2008) 21 SOT 101 (Mum.).
7. Direction to Reduce Cost of Acquisition of Assets u/s 43(1):
The CIT(A) directed the AO to reduce the cost of acquisition of assets by the amount of subsidy received. The Tribunal, referencing the Visakhapatnam Bench's decision in Sasisri Extractions Ltd. Vs. ACIT (2008) 307 ITR 127 (AT) and the Supreme Court's decision in CIT Vs. P.J. Chemicals Ltd. (1994) 210 ITR 830 (SC), concluded that the sales-tax subsidy received by the assessee cannot be treated as a subsidy for the asset employed. Therefore, the CIT(A)'s direction was not justified, and the ground was allowed in favor of the assessee.
Conclusion:
The revenue's appeal was dismissed, and the assessee's appeal was partly allowed. The order was pronounced in open court on 28-8-2009.
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2008 (3) TMI 761
The Supreme Court allowed the application for condonation of delay in filing an appeal and restored the appeal to its original number. The High Court was requested to decide the appeal on merits within three months. The appeal was allowed without any costs.
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2008 (3) TMI 760
Issues Involved:
1. Maintainability of the company petition under Sections 397 and 398 of the Companies Act, 1956.
2. Compliance with Section 399 requirements.
3. Validity of the issue and conversion of redeemable cumulative preference shares (RCPS) into equity shares.
4. Allegations of oppression and mismanagement.
5. Impact of share allotment to R.N. Shetty Family Trust.
6. Historical litigation and its relevance to the current petition.
Detailed Analysis:
1. Maintainability of the Company Petition:
The primary issue is whether the petitioner qualifies under Section 399 to invoke the jurisdiction of the Company Law Board (CLB) under Sections 397/398 for acts of oppression and mismanagement in the company. The petitioner claims to hold 15.60% of the company's paid-up capital. However, after the conversion of RCPS into equity shares, his shareholding was reduced to 1.42%. The petitioner has challenged the issue and conversion of these shares, arguing that if these actions are found invalid, his shareholding would revert to 15.60%, qualifying him to maintain the petition.
2. Compliance with Section 399 Requirements:
Section 399 stipulates that members holding not less than one-tenth of the issued share capital of the company have the right to apply under Sections 397/398. The petitioner originally held 15.60% but was reduced to 1.42% due to the conversion of RCPS. The validity of this conversion is under challenge, and if found invalid, the petitioner would meet the Section 399 requirement.
3. Validity of Issue and Conversion of RCPS:
The petitioner did not subscribe to the RCPS offered to him, leading to a reduction in his shareholding. The company justified the issue and conversion of RCPS as necessary for raising funds and benefiting the company. However, the petitioner argues that the conversion was done for ulterior purposes and without proper disclosure. The validity of these actions involves substantial factual matters that cannot be adjudicated as a preliminary issue but must be examined in the main proceedings.
4. Allegations of Oppression and Mismanagement:
The petitioner alleges that the issue and conversion of RCPS were acts of oppression and mismanagement aimed at reducing his shareholding. The company contends that the actions were in the company's best interest and approved by the board and shareholders. The petitioner's failure to subscribe to the RCPS and the subsequent reduction in his shareholding are central to these allegations.
5. Impact of Share Allotment to R.N. Shetty Family Trust:
The petitioner asserts that shares were improperly allotted to R.N. Shetty Family Trust, which holds a significant portion of the company's shares. The company acknowledges the allotment but claims compliance with applicable laws. The validity of this allotment and its impact on the petitioner's shareholding must be examined to determine the maintainability of the petition.
6. Historical Litigation:
The petitioner has a history of litigation against the company, starting in 1989. Previous petitions were dismissed, and the petitioner was given the option to either continue as a member or exit the company by transferring his shares. The current petition is another attempt to address grievances related to shareholding and management practices.
Conclusion:
The judgment concludes that the petitioner's right to apply under Section 399 cannot be denied at the threshold. The validity of the issue and conversion of RCPS and the allotment to R.N. Shetty Family Trust must be examined in the main proceedings. The petition cannot be dismissed as not maintainable until these issues are resolved. The parties are directed to complete the pleadings, and the proposed parties must be given an opportunity to be heard. The final determination of the petition's maintainability will depend on the findings regarding the issue and conversion of RCPS and the allotment of shares.
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2008 (3) TMI 759
The Supreme Court of India dismissed the Civil Appeal in the case. No representation was made by the respondent. (2008 (3) TMI 759 - SC)
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2008 (3) TMI 758
Issues involved:
The interpretation of Section 5-A of the H.P. General Sales Tax Act, 1968 and the constitutional validity of the same.
Interpretation of Section 5-A:
The petitioner firm challenged the levy of sales tax under Section 5-A of the Act, contending that it does not apply to goods specified in Schedule B. The court held that Section 5-A only applies to goods not listed in Schedule B, and no tax can be imposed on goods falling under Schedule B. The court emphasized that the language of the section is clear and unambiguous, and any goods used to manufacture those listed in Schedule B would be liable to tax under specific conditions mentioned in the section itself.
Application of Section 5-A to the case:
The petitioner argued that there was no sale involved as they purchased maize from farmers on behalf of another company. The court found that the petitioner acted as an agent for the other company, purchasing maize directly from farmers, which is exempt from tax under Section 7 of the Act. Even if the transaction was considered a sale, the court held that it would be an inter-State sale, and the State lacked the authority to levy tax. The court also dismissed the State's argument that the petitioner evaded Central Sales Tax, stating that it was the Central Sales Tax Authority's responsibility to verify declarations.
Decision and Conclusion:
The court allowed the writ petition, quashing the assessment order that levied sales tax on the petitioner. The court found in favor of the petitioner, stating that the maize was purchased on behalf of another company and was exempt from tax under the relevant provisions of the Act. The court emphasized that the petitioner's role as an agent precluded the imposition of tax by the State.
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2008 (3) TMI 757
The Supreme Court of India dismissed the appeals, maintaining the lower courts' findings. The interest rate was reduced to 18% per annum, with payment due within three months. The Bank Guarantee was discharged.
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2008 (3) TMI 756
Issues Involved:
1. Interpretation of Sections 173(5) and 207 of the Code of Criminal Procedure (CrPC), Sections 3 and 65B of the Indian Evidence Act (EA), and Sections 2(o) and 2(t) of the Information Technology Act (IT Act).
2. Whether hard discs (HDs) containing intercepted telephone conversations are "documents" under Section 173(5)(a) and Section 207(v) CrPC.
3. Discretion of the prosecution to decide which documents to rely upon and the powers of the court in this regard.
4. Whether denial of access to all documents gathered during investigation violates the fundamental right to a fair trial under Article 21 of the Constitution.
5. How the accused should be provided access to the HDs.
Detailed Analysis:
Issue (i): Are the Hard Discs Documents?
The court examined the statutory provisions, including Sections 173(5) and 207 CrPC, and definitions under the Indian Evidence Act and Information Technology Act. It concluded that:
- A hard disc, once written upon or subjected to any change, becomes an electronic record and thus a document.
- Both the CDs containing the relevant intercepted telephone conversations and the HDs themselves are considered electronic records and therefore documents under Sections 173(5)(a) and 207(v) CrPC.
Issue (ii) and (iii): Discretion of the Prosecution and Powers of the Court
The court held that:
- The prosecution is obliged to furnish copies of only those documents it proposes to rely upon, as indicated in the charge sheet or already sent to the court during investigation.
- The trial court cannot direct the prosecution to furnish copies of documents other than those it proposes to rely upon.
- The prosecution must indicate in the charge sheet the documents it relies upon. If it fails to do so, the court will assume all forwarded documents are relied upon.
- In the Shameet Mukherjee case, the court found that the prosecution must provide copies of the 19 CDs containing 768 calls, as they are mentioned in the charge sheet.
Issue (iv): Right to a Fair Trial
The court determined that:
- As long as the statutory requirements of Sections 207(v) and 173(5)(a) CrPC are strictly complied with, the failure to furnish all documents gathered during investigation does not violate the right to a fair trial under Article 21 of the Constitution.
- None of the cited decisions support the contention that denial of access to all documents gathered during investigation at the pre-charge stage constitutes a violation of the fundamental right to a fair trial.
Issue (v): Access to the Hard Discs
The court directed that:
- The accused should be allowed to listen to the original recordings of the relevant intercepted telephone conversations directly from the HDs in the presence of the accused or their representatives, their counsel, and the learned Judge.
- The four HDs should be brought back to Delhi and kept in a controlled environment, subject to the directions of the learned Special Judge.
- The recorded conversations should be played in the presence of the relevant parties, and this process should be completed within a specified timeframe.
- In the Shameet Mukherjee case, the accused should be provided with copies of the 19 CDs containing the 768 calls, but need not have access to the entire 768 calls recorded in the HDs at this stage.
Final Directions:
1. The CBI will provide copies of the 19 CDs containing 768 calls to the accused in the Shameet Mukherjee case within one week.
2. The four HDs will be brought back to Delhi and kept in a controlled environment.
3. The learned Special Judge will fix dates for playing the original recorded conversations directly from the HDs.
4. The arguments on charge should be concluded by 30th April 2008, and orders on charge should be passed by 31st May 2008.
5. The petitions and applications are disposed of accordingly.
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2008 (3) TMI 755
Issues involved:
The judgment involves the contravention of Sections 14 & 8(1) of the Foreign Exchange Regulations Act 1973, penalties imposed by the Dy. Director, Directorate of Enforcement, Mumbai, reduction of penalty amount by the Appellate Tribunal, and challenges to a common appellate judgment and order by the appellants in four appeals.
Details of the judgment:
Contravention of FERA Sections 14 & 8(1):
The appellants were found to have contravened Sections 14 & 8(1) of FERA, leading to penalties imposed by the Dy. Director, Directorate of Enforcement, Mumbai. The Appellate Tribunal partly allowed the appeals, upholding the charges and findings but reducing the penalty amount by 50%.
Facts leading to adjudication:
- M/s. Telstar Travels Pvt. Ltd. operated a ticketing business for crew members working in ships, evolving a method to purchase air tickets abroad.
- Mr. Rajesh Desai, son of the Managing Director, entered into an agreement with a foreign travel agent, involving an account in Geneva operated by Mr. Shirish Shah.
- The foreign account was allegedly operated illegally by M/s. Telstar Pvt. Ltd., with Rajesh Desai instructing on transactions.
- Statements of involved parties and corroborative evidence supported the allegations of illegal operations.
Concurrent findings and evidence:
- Statements of involved parties, documents seized, and corroborative evidence supported the allegations of illegal operations.
- The Appellate Tribunal relied on various statements, documents, and an enquiry report to confirm the illegal operations.
Judgment:
After reviewing the evidence and findings, the Court found no legal issues to interfere with the substantial penalty deduction by the Appellate Tribunal. The judgment summarily dismissed the appeals, upholding the penalties imposed for contravention of FERA sections.
This summary provides a detailed overview of the issues, facts, findings, and the final judgment in the case without revealing specific party names.
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2008 (3) TMI 754
TDS certificates can be treated as an acknowledgement in writing of the debt due? - Suit for recovery framed under Order 37 would be maintainable or not - Liability to pay interest on the loan - HELD THAT:- The claim was raised in the notice for claiming the interest at the rate of 15 per cent upto 31st March, 2003 (minus TDS paid) and thereafter at the rate of 15 per cent per annum. Objection in regard to maintainability of the suit has been taken by the appellant and argued before the learned single Judge with some emphasis. This contention has been noticed in the impugned judgment. We are unable to find any merit in the contention of the counsel for the respondent that the appellant cannot be permitted to argue this issue because specific objection in that regard was not taken in the application for leave to defend.
Firstly, the application for leave to defend does show averment that the suit of the plaintiff is not maintainable and should be dismissed. Secondly, this is a question of law and it is obligatory upon the respondent to show that on the bare reading of the plaint, the suit under the provisions of Order 37 of the Code would be maintainable. The issuance of TDS certificates does not amount to an acknowledgement of defendant within the meaning of Section 25 of the Indian Evidence Act and the Full Bench judgment of this Court in the case of Jyotsna [2007 (4) TMI 748 - BOMBAY HIGH COURT] puts the matter beyond doubt.
A suit based upon bill of exchange, hundi, promissory note to recover a debt or liquidated demand payable by the plaintiff to the defendant with or without interest but arising from a written contract, or an enactment, or a guarantee where the claim against the principal is in respect of a debt or liquidated demand only. We are unable to accept the contentions raised on behalf of the respondent that issuance of certificate for tax deduction at source would be a document which will fall in any of the clauses stated under Order 37 Rule 2. Admittedly, the loan was advanced as a friendly loan to which serious dispute has been raised. The dispute raised by the defendant relates to questions of law as well as facts.
It is a settled principle of law that before a plaintiff can bring a suit to be tried under the special summary procedure provided under Order 37 of the Code, it is obligatory on the part of the plaintiff to satisfy the Court that the suit as framed is not only maintainable under the provisions of Order 37 of the Code but no relief whatsoever have been claimed in the suit that are falling outside the ambit and scope of the said provision. Wherever such an objection is taken, which in fact has been taken in the present case, the law requires the plaintiff in a suit to show that taking the averments made in the plaint to be correct, the suit satisfies the ingredients of the special provisions. If the ingredients of Order 37 on the plain reading of the plaint are not satisfied, then plaintiff cannot claim any benefit of the summary procedure. Even on the plea of demur, the appellant is unable to demonstrate in the present case that suit squarely falls within the ambit of Order 37 and the reliefs claimed therein including the interest claim falls within the ambit and scope of the said provision.
Therefore, we allow this appeal, set aside the impugned order under appeal. We further direct that the suit shall proceed as an ordinary suit and not as a summary suit under the provisions of Order 37 of the Code.
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2008 (3) TMI 753
Issues Involved:
1. Legality of the ex-parte decree in Title Suit No. 140 of 1999.
2. Applicability of Rule 102 of Order XXI of the Code of Civil Procedure, 1908.
3. Doctrine of lis pendens and its impact on the sale during the pendency of the suit.
4. Right of the appellant to seek protection under Rule 29 of Order XXI of the Code.
Summary:
1. Legality of the ex-parte decree in Title Suit No. 140 of 1999:
The respondent filed Title Suit No. 140 of 1999 against several defendants. During the pendency of the suit, defendants No. 4 and 5 sold their share to the appellant. An ex-parte decree was passed on May 24, 2001, declaring the plaintiff's right and title over the suit land. The appellant filed Title Suit No. 226 of 2001, asserting ownership and challenging the decree as illegal, inexecutable, and obtained by fraud.
2. Applicability of Rule 102 of Order XXI of the Code of Civil Procedure, 1908:
The appellant sought an injunction to stay the execution of the decree. The Executing Court initially granted the stay, but the High Court set aside this order, invoking Rule 102 of Order XXI, which states that nothing in Rules 98 and 100 shall apply to resistance or obstruction by a transferee pendente lite. The Supreme Court upheld this view, emphasizing that Rule 102 is based on justice, equity, and good conscience, and aims to prevent unfair protection to transferees pendente lite.
3. Doctrine of lis pendens and its impact on the sale during the pendency of the suit:
The Court reiterated that the doctrine of lis pendens, recognized by Section 52 of the Transfer of Property Act, 1882, applies to the sale made during the pendency of the suit. The doctrine prohibits dealing with the property under litigation, and the transferee is bound by the decree. The Court cited precedents, including Bellamy v. Sabine and Silverline Forum Pvt. Ltd. v. Rajiv Trust, affirming that a transferee pendente lite has no right to resist or obstruct the execution of the decree.
4. Right of the appellant to seek protection under Rule 29 of Order XXI of the Code:
The appellant argued for protection under Rule 29 of Order XXI, which deals with cases where a suit is instituted by the judgment-debtor against the decree-holder. The Court clarified that Rule 29 has no relevance to cases of lis pendens. The appellant, being a transferee pendente lite, cannot be considered a 'stranger' to the suit and must be presumed to be aware of the litigation. The Court concluded that the appellant could not resist execution during the pendency of her suit and must seek restitution if she succeeds in her suit.
Conclusion:
The Supreme Court dismissed the appeal, upholding the High Court's decision that the appellant, as a transferee pendente lite, could not resist the execution of the decree. The Court emphasized the principles of lis pendens and the applicability of Rule 102 of Order XXI, ensuring that the decree-holder could realize the fruits of the decree. No order as to costs was made.
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