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2005 (4) TMI 634
Issues:
1. Bail application based on recovery of contraband from co-accused.
2. Admissibility of secret information in the case.
3. Interpretation of Section 37 of the NDPS Act.
4. Consideration of past judicial decisions on similar circumstances for granting bail.
Analysis:
1. The petitioner's counsel argued that no recovery was made from the petitioner, but contraband was allegedly found on the co-accused. Citing past cases, it was emphasized that without evidence linking the petitioner to the contraband, bail should be granted. The court noted that the recovery from the co-accused alone does not establish the petitioner's guilt.
2. The defense relied on legal precedents to challenge the admissibility of secret information without the informant's examination. Referring to a Supreme Court case, it was highlighted that such information is inadmissible unless the informant is examined as a witness.
3. The State contended that Section 37 of the NDPS Act applied due to the recovery of contraband. However, the court reasoned that without concrete evidence linking the petitioner to the contraband, the application of Section 37 was not straightforward. The court emphasized the lack of admissible evidence connecting the petitioner to the recovered contraband.
4. Past judicial decisions were crucial in determining the petitioner's bail eligibility. Citing cases where recovery from co-accused did not lead to the accused's guilt, the court found reasonable grounds to believe the petitioner was not involved in the offense. Considering the petitioner's clean record and no likelihood of reoffending, bail was granted upon furnishing a personal bond.
In conclusion, the court granted bail to the petitioner based on the lack of evidence linking them to the recovered contraband, the inadmissibility of secret information without the informant's examination, and the absence of criminal antecedents. The judgment underscored the importance of substantive evidence in establishing guilt and the need for a fair assessment of each case for bail consideration.
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2005 (4) TMI 633
The Supreme Court of India allowed the appeals, set aside the convictions and sentences, and acquitted the appellant in two cases under the Negotiable Instruments Act and Indian Penal Code due to a lawful compromise between the parties.
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2005 (4) TMI 632
The Supreme Court of India issued an order in 2005 (4) TMI 632 - SC, with Justices Y.K. Sabharwal and P.P. Naolekar. The court issued notice on the civil appeal and the application for stay. Recovery of the differential duty was stayed in the meantime.
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2005 (4) TMI 631
Issues Involved:
1. Whether the issue of interpolation in the agreement dated 02.09.1978 can be raised again between the same parties in a different suit.
2. Whether the principle of res judicata, waiver, and estoppel precludes respondent No. 1 from raising the issue of interpolation in the agreement dated 02.09.1978.
3. Whether respondent No. 1's undertaking in Civil Revision No. 18 of 1999 binds her from raising the issue of interpolation in another suit.
4. Whether respondent No. 1 is precluded from alleging interpolation in the renewal clause of the agreement dated 02.09.1978.
Detailed Analysis:
Issue 1: Raising the Issue of Interpolation Again
The main issue in this appeal is whether an issue already settled in a suit between the same parties regarding the same subject matter can be raised again in a different suit. The earlier proceedings determined that respondent No. 1 could not raise the issue of interpolation in the renewal clause of the lease deed agreement dated 02.09.1978. The High Court held that respondent No. 1 had expressly given up this issue, which was affirmed by the Supreme Court in S.L.P.(C) No. 16513 of 2001. Despite this, respondent No. 1 sought to re-agitate the same issue in another suit. The appellants argued that this issue is barred by res judicata, waiver, and estoppel, but the sub-Judge and the High Court of Patna allowed respondent No. 1 to raise the issue again.
Issue 2: Principles of Res Judicata, Waiver, and Estoppel
The appellants contended that the issue of interpolation in the agreement dated 02.09.1978 had already been settled and could not be raised again. The High Court had previously recorded respondent No. 1's undertaking not to raise the issue of interpolation, and this was affirmed by the Supreme Court. The principle of res judicata, waiver, and estoppel prevents the same issue from being re-litigated between the same parties. The Supreme Court agreed with the appellants, holding that the High Court failed to appreciate that respondent No. 1's undertaking was binding and that she was barred from raising the same issue again.
Issue 3: Binding Undertaking in Civil Revision No. 18 of 1999
Respondent No. 1 had given an undertaking in Civil Revision No. 18 of 1999 that she would not raise the issue of interpolation in the agreement dated 02.09.1978. This undertaking was recorded by the High Court, and the Civil Revision was disposed of accordingly. Respondent No. 1 later filed a review application, which was dismissed, and subsequently filed a Special Leave Petition, which was also dismissed by the Supreme Court. The Supreme Court held that respondent No. 1 is precluded from raising the issue of interpolation/forgery in the renewal clause of the agreement again, as the matter had been conclusively settled.
Issue 4: Alleging Interpolation in the Renewal Clause
Respondent No. 1 admitted the execution of the agreement and her signature on the bilateral agreement dated 02.09.1978. Despite this, she later alleged interpolation in the renewal clause. The Supreme Court held that respondent No. 1 is precluded from raising the issue of interpolation in the renewal clause, as it was already settled by the High Court and affirmed by the Supreme Court. The Court emphasized that once an issue of fact has been judicially determined between the same parties, it cannot be raised again in subsequent proceedings.
Conclusion:
The Supreme Court concluded that respondent No. 1 is precluded from raising the issue of interpolation in the agreement dated 02.09.1978. The High Court's order allowing respondent No. 1 to raise the issue again was set aside. The Court restricted respondent No. 1 from questioning the genuineness of the agreement dated 02.09.1978 and directed that any evidence relating to the genuineness/interpolation or forgery of the agreement should be eschewed from consideration by the trial Court. The appeal was allowed, and no costs were awarded.
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2005 (4) TMI 630
Issues:
- Whether a direction for DNA test can be given in a proceeding for issuance of a succession certificate under the Indian Succession Act, 1925.
Analysis:
The core issue in this appeal was whether a direction for a DNA test can be given in a proceeding for the issuance of a succession certificate under the Indian Succession Act, 1925. The appellant sought a DNA test of the respondent to establish paternity in a case where the respondent had filed for a succession certificate claiming to be the daughter of the deceased. The trial court allowed the application for DNA test primarily on the grounds of the respondent's initial concealment of facts and lack of cogent documentary evidence. However, the High Court set aside this direction, emphasizing the limited scope of the inquiry in a testamentary court and the need to rely on evidence produced during trial rather than creating evidence through a DNA test.
The High Court's decision was supported by legal principles outlined in previous judgments, including the Supreme Court's ruling in Goutam Kundu v. State of West Bengal. This ruling highlighted that courts cannot order blood tests as a matter of routine and emphasized the need for a strong prima facie case to justify a DNA test. The court must consider the consequences of ordering a DNA test, especially in cases involving paternity disputes. The legal presumption of legitimacy under Section 112 of the Evidence Act was also discussed, emphasizing the burden of proof on the party disputing paternity to establish non-access.
Furthermore, the purpose of a succession certificate was clarified as facilitating debt collection and protecting parties dealing with representatives of deceased persons. The grant of a succession certificate does not establish the title of the grantee as the heir of the deceased but authorizes them to collect debts. The court reiterated that DNA tests should not be directed as a routine measure and should only be considered in deserving cases, as established in previous judgments.
Ultimately, the Supreme Court upheld the High Court's decision to set aside the direction for a DNA test in this case, emphasizing that the trial court's decision was unsustainable. The judgment clarified that the court had not expressed any opinion on the merits of the succession application, focusing solely on the issue of the DNA test direction.
In conclusion, the judgment provided a detailed analysis of the legal principles surrounding DNA tests in succession cases, emphasizing the need for a strong prima facie case and the limited circumstances where a DNA test may be warranted. The decision highlighted the importance of relying on existing evidence and legal presumptions in such matters, ultimately affirming the High Court's ruling in this case.
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2005 (4) TMI 627
Issues Involved:
1. Legality of the appointment of a former police officer as a member of the National Human Rights Commission (NHRC).
2. Alleged violation of the Protection of Human Rights Act, 1993.
3. Compliance with international covenants, specifically the Paris Principles.
4. Alleged arbitrariness and violation of Article 14 of the Constitution of India.
5. Consultation process in the appointment procedure.
Issue-wise Detailed Analysis:
1. Legality of the Appointment of a Former Police Officer:
The petitioner challenged the appointment of the second respondent, a former Director of the Central Bureau of Investigation (CBI), as a member of the NHRC, arguing that it contradicts the objectives of the Protection of Human Rights Act, 1993, and undermines the Commission's status. The Supreme Court held that neither the Act nor the Paris Principles expressly exclude police officers from being appointed to the NHRC. The Court emphasized that Section 3(2)(d) of the Act, which requires members to have knowledge or practical experience in human rights matters, does not exclude any class of persons, including police officers.
2. Alleged Violation of the Protection of Human Rights Act, 1993:
The petitioner argued that the appointment was contrary to Section 3(2)(d) of the Act, which requires members to have knowledge of or practical experience in human rights. The Court found that the second respondent, having supervised investigations involving serious human rights violations, possessed the requisite knowledge and experience. The Court ruled that the clear language of the statute does not permit an interpretation that excludes police officers.
3. Compliance with International Covenants (Paris Principles):
The petitioner relied on the Paris Principles, which were endorsed by the UN Commission on Human Rights and the UN General Assembly, arguing that these principles prohibit the appointment of civil servants like police officers to the NHRC. The Supreme Court noted that the Paris Principles and the UN Resolution do not explicitly exclude police officers from such appointments. The Court further held that international declarations and resolutions cannot override the express provisions of the Act enacted by the Indian Parliament.
4. Alleged Arbitrariness and Violation of Article 14:
The petitioner contended that the appointment was arbitrary and violated Article 14 of the Constitution. The Court, referencing the judgment in R.K. Jain v. Union of India, held that judicial review in appointments is limited to examining whether the appointee possesses the statutory qualifications. The Court found no violation of Article 14, as the second respondent met the statutory requirements under the Act.
5. Consultation Process in the Appointment Procedure:
The petitioner argued that the appointment was made without consulting the Chairperson of the NHRC, which was the practice since the Commission's inception. The Court held that the Act does not mandate consultation with the Chairperson for appointments. The Court also addressed the issue of proper consultation among the Selection Committee members, noting that the Act does not prescribe a quorum or specific procedure. The Court found that the non-response of one member due to hospitalization did not invalidate the decision of the other five members.
Conclusion:
The Supreme Court dismissed the petition, upholding the appointment of the former police officer as a member of the NHRC. The Court ruled that the appointment was in accordance with the Protection of Human Rights Act, 1993, and that neither the Paris Principles nor the UN Resolution prohibit such appointments. The Court also found no violation of Article 14 or procedural irregularities in the appointment process.
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2005 (4) TMI 626
Issues:
1. Penalty under section 271C for short deduction of tax from salaries.
2. Reasonable cause for failure to comply with section 192 of the Income-tax Act.
3. Challenge to the findings of the Income-tax Appellate Tribunal.
Analysis:
Issue 1: Penalty under section 271C for short deduction of tax from salaries
The case involved Hitachi Ltd., which had expatriate employees working in India. The assessee failed to consider the salary income paid in Japan for deduction of tax from salaries under section 192 of the Income-tax Act. The Assessing Officer imposed a penalty of Rs. 4,12,49,705 under section 271C for short deduction of tax. The Commissioner of Income-tax (Appeals) upheld the penalty. However, the Income-tax Appellate Tribunal found merit in the assessee's contentions, citing the case of Azadi Bachao Andolan. The Tribunal held that the appellant was not liable for penalty as it had a bona fide belief that the pay in Japan was not taxable in India, constituting a reasonable cause for the failure.
Issue 2: Reasonable cause for failure to comply with section 192 of the Income-tax Act
The Tribunal's findings highlighted that the appellant's belief regarding the non-taxability of pay in Japan constituted a reasonable cause for the failure to deduct tax at source. The Tribunal emphasized that the appellant satisfied the parameters set in previous judgments and should not be treated differently from other Japanese companies in similar situations. The Tribunal concluded that the appellant acted under a bona fide belief, justifying the non-applicability of penalty under section 271C.
Issue 3: Challenge to the findings of the Income-tax Appellate Tribunal
The Revenue challenged the Tribunal's findings before the High Court under section 260A of the Act. However, the High Court noted that the controversy was covered by a previous judgment in the case of CIT v. Itochu Corpn. The Court emphasized that the Tribunal's finding of fact regarding the reasonable cause for the failure to deduct tax at source was justified. The Court agreed with the Tribunal's conclusion that the appellant acted under a reasonable belief and dismissed the appeal, stating that no substantial question of law arose for consideration.
In conclusion, the High Court upheld the Tribunal's decision, emphasizing the importance of a reasonable cause for failure to comply with tax deduction provisions and highlighting the significance of bona fide beliefs in such cases.
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2005 (4) TMI 625
Issues:
1. Suit filed under Sec.34 of the Arbitration and Conciliation Act to set aside an award.
2. Preliminary issue of whether the suit is barred by time under Sec.34(3) of the Act.
3. Applicability of Sections 12 and 14 of the Limitation Act to proceedings under the Act.
4. Exclusion of time under Sec.14 of the Limitation Act for prosecuting the matter in a wrong court.
5. Timeliness of filing the suit before the City Civil Court after return of papers from the previous court.
6. Dismissal of the suit by the lower court based on the issue of limitation.
7. Lack of bonafides and diligence on the part of the appellant in prosecuting the matter.
8. Applicability of provisions of the Limitation Act in the case.
Analysis:
1. The appeal was filed under Sec.37 of the Arbitration and Conciliation Act by the plaintiffs to set aside an award made by the Chief Engineer, Irrigation Department. The suit was filed under Sec.34 of the Act, and the issue arose when the defendants contended that the suit was barred by time for not being filed within 90 days as per Sec.34(3) of the Act.
2. The Prl. District Judge dismissed the suit as barred by time after treating the limitation issue as a preliminary one. The question of limitation was crucial, and similar matters were being heard simultaneously to address this issue. The judgment in a related matter clarified the applicability of Sec.14 of the Limitation Act to exclude time taken in prosecuting a matter in a wrong court.
3. The trial court initially held that none of the provisions of the Limitation Act applied to the petition filed under the Acts. However, the higher court, after considering arguments from all parties, concluded that Sections 12 and 14 of the Limitation Act are indeed applicable to proceedings under the Act.
4. The appellants were found entitled to exclude the time when the arbitration proceedings were pending before the Civil Judge, Senior Division, Ramanagaram. It was established that the suit was filed within the period of limitation as provided by the Act, and the exclusion of time was deemed appropriate in this context.
5. The timeliness of filing the suit before the City Civil Court after the return of papers from the previous court was a point of contention. The respondent argued that there was a delay in re-filing the papers, but it was clarified that the delay was not substantial and did not affect the overall timeliness of the filing.
6. The court emphasized the importance of promptly re-filing records returned by one court before another court. The delay in making the necessary endorsements was considered, and it was established that the appellant acted diligently in re-filing the papers before the City Civil Court, Bangalore Rural District.
7. The judgment highlighted the lack of jurisdiction of the first court where the proceedings were initially filed and the subsequent diligent actions of the appellant in rectifying the jurisdictional issue. The court found no lack of bonafides on the part of the appellant in prosecuting the matter.
8. Ultimately, the appeal was allowed, and the lower court's order was set aside. The matter was remanded to the lower court to proceed in accordance with the law, recognizing the applicability of the provisions of the Limitation Act and the diligent conduct of the appellant in rectifying jurisdictional issues.
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2005 (4) TMI 624
Issues:
1. Stay on execution of money decree pending appeal.
2. Discretion of the Appellate Court to direct deposit or security.
3. Grounds for granting stay and choice between cash deposit or security.
4. Prima facie case for hearing appeal on merits and public interest.
Analysis:
1. The appellant, a statutory body under the Gujarat Municipality Act, terminated a contract with the respondent, leading to a civil suit for damages. The High Court admitted the appeal for hearing and granted a stay subject to a cash deposit. The appellant sought variation, citing financial difficulties due to octroi abolition and offered security instead of cash deposit. The Court extended the deposit deadline but declined to dispense with it. The Supreme Court directed a stay on decree execution, subject to immovable property security.
2. Order XLI Rule 1(3) and Rule 5(5) of the CPC provide for deposit or security in appeals against payment decrees. The Appellate Court has discretion to decide on deposit or security based on the case's circumstances. While money decree execution is not typically stayed, the power exists for appropriate cases, to be exercised judicially.
3. The appellant raised various grounds in the appeal, including lack of legal evidence for the decree. The High Court considered a stay, focusing on cash deposit versus security. The Supreme Court found merit in allowing security instead of cash, noting the appellant's strong case for appeal hearing and public interest in retaining the amount during the appeal.
4. Considering the submissions and circumstances, the Supreme Court held that security should have been permitted instead of insisting on a cash deposit by the High Court. The appellant furnished immovable property security as directed. The appeals were allowed, setting aside the High Court's orders and substituting the Supreme Court's interim order. No costs were awarded.
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2005 (4) TMI 623
Issues Involved:
1. Validity of reopening of the assessment under section 147 of the Income-tax Act.
2. Existence of a Permanent Establishment (PE) in India and the consequent taxability of income attributable to such PE.
Issue-wise Detailed Analysis:
1. Validity of Reopening of Assessment under Section 147:
The appellant challenged the reopening of the assessment under section 147 of the Act. The appellant, a company incorporated in the UK, contended that the Assessing Officer (AO) did not have valid reasons to believe that income chargeable to tax had escaped assessment. The AO's reasons for reopening included information from Hindustan Aeronautics Ltd. (HAL) about a contract for the sale of 20 Jaguar aircraft and other spares, which the AO believed led to taxable income that had not been declared.
The CIT(A) upheld the reopening, stating that the AO had reasonable belief based on proper information that income chargeable to tax had escaped assessment. The CIT(A) noted that the AO had information about the appellant supplying spare parts and accessories to HAL and other parties in India, which justified the issuance of notice under section 148.
The Tribunal considered the rival submissions and concluded that the AO had sufficient information to form a prima facie belief that income chargeable to tax had escaped assessment. The Tribunal emphasized that at the time of reopening, the AO is not required to reach a final conclusion about the quantum of income that escaped assessment. The Tribunal found that the initiation of reassessment proceedings was valid and dismissed the first two grounds of the appellant.
2. Existence of a Permanent Establishment (PE) in India:
The appellant challenged the AO's conclusion that it had a business connection and a PE in India through Rolls Royce India Ltd. (RRIL), which would make its income attributable to such PE taxable in India. The AO had concluded that RRIL, acting on behalf of the appellant, constituted a dependent agent PE in India based on various meetings and activities performed by RRIL.
The Tribunal examined the provisions of section 9 of the Income-tax Act and the Double Taxation Avoidance Agreement (DTAA) between India and the UK. Under Article 5(4) of the DTAA, a person acting on behalf of an enterprise of the other Contracting State is deemed to be a PE if they habitually exercise authority to negotiate and enter into contracts, maintain a stock of goods for delivery, or secure orders for the enterprise.
The Tribunal found that RRIL's activities were limited to liaison services and did not include the authority to conclude contracts on behalf of the appellant. The Tribunal reviewed the minutes of meetings and concluded that RRIL did not have the necessary authority or habitually exercise such authority to negotiate or conclude contracts. The Tribunal also noted that RRIL's role was limited to providing information and organizing meetings, which did not constitute a PE under Article 5(4) of the DTAA.
Additionally, the Tribunal considered the applicability of Article 5(2)(k) of the DTAA, which pertains to the furnishing of services. The Tribunal found that RRIL rendered services to the appellant, and it was not the case that the appellant rendered services in India. Therefore, RRIL could not be considered a PE of the appellant under Article 5(2)(k).
The Tribunal concluded that the appellant did not have a PE in India, and consequently, its business income was not chargeable to tax in India. The Tribunal directed the deletion of the additions made by the AO.
Conclusion:
The appeal was partly allowed. The Tribunal upheld the validity of the reopening of the assessment under section 147 but concluded that the appellant did not have a PE in India, and therefore, its business income was not taxable in India. The other grounds of appeal regarding the quantum of amounts brought to tax were not adjudicated, and the appellant withdrew grounds related to the levy of interest under sections 234A and 234B of the Act.
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2005 (4) TMI 622
The Supreme Court allowed the withdrawal of special leave petitions, stating that the respondent correctly pointed out that an appeal against the impugned order lies before the High Court. The petitioner was granted liberty to approach the High Court. (2005 (4) TMI 622 - SC Order)
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2005 (4) TMI 621
Issues Involved:
1. Recovery of possession and mesne profits for 'B' Schedule property.
2. Trespass over 'C' Schedule property.
3. Relationship of landlord and tenant.
4. Requirement of notice under Section 106 of the Transfer of Property Act.
5. Applicability of the West Bengal Premises Tenancy Act, 1956.
6. Maintainability of the suit by the plaintiffs in their individual capacity.
7. Default in payment of rent.
Issue-wise Detailed Analysis:
1. Recovery of Possession and Mesne Profits for 'B' Schedule Property:
The High Court restored the decree for recovery of possession and mesne profits regarding 'B' Schedule property in favor of the plaintiffs. The Subordinate Court had decreed the suit, holding that the appellant's tenancy ended by efflux of time on 13th April 1959, and there was no necessity to determine the tenancy by issuing a notice under Section 106 of the Transfer of Property Act. The High Court found that the lease was for the business of iron casting foundry, not the premises, thus not falling under the West Bengal Premises Tenancy Act, 1956.
2. Trespass Over 'C' Schedule Property:
The Subordinate Court and the Appellate Court found that 'C' Schedule property was not included in the settlement and the appellant had trespassed upon it. The High Court affirmed this finding, establishing that the appellant's occupation of 'C' Schedule property was illegal and by way of trespass.
3. Relationship of Landlord and Tenant:
The Subordinate Court established that a landlord-tenant relationship existed between the parties regarding 'B' Schedule property. The appellant was estopped under Section 116 of the Indian Evidence Act from disputing the plaintiffs' title. The High Court agreed with this finding, emphasizing that the lease was of the business, not the premises.
4. Requirement of Notice Under Section 106 of the Transfer of Property Act:
The Appellate Court initially held that tenancy could not be determined without issuing notice under Section 106 of the Transfer of Property Act. However, the High Court set aside this finding, concluding that the settlement was of the business and not the premises, thus not requiring such notice.
5. Applicability of the West Bengal Premises Tenancy Act, 1956:
The High Court determined that the lease was for the business of iron casting foundry, not the premises, and therefore, the West Bengal Premises Tenancy Act, 1956, did not apply. The court relied on precedents such as Uttamchand vs. S.M. Lalwani and Dwarka Prasad vs. Dwarka Das Saraf, which distinguished between leases of premises and businesses.
6. Maintainability of the Suit by the Plaintiffs in Their Individual Capacity:
The Appellate Court had questioned the maintainability of the suit filed by the plaintiffs in their individual capacity, considering the original settlement was made by a partnership firm. However, the High Court held that after the dissolution of the partnership firm, the plaintiffs could file the suit in their individual capacity.
7. Default in Payment of Rent:
The High Court's finding that the appellant had defaulted in the payment of rent was challenged. The Supreme Court noted that the plaintiffs did not plead default in rent payment, nor was there any issue framed on this point. Consequently, the High Court erred in passing a decree for eviction on the ground of default in rent payment.
Conclusion:
The Supreme Court affirmed the High Court's judgment and decree, dismissing the appeal. The High Court correctly identified the lease as one of the business, not the premises, thereby excluding it from the West Bengal Premises Tenancy Act, 1956. The findings regarding trespass, the relationship of landlord and tenant, and the maintainability of the suit were upheld. The Supreme Court, however, found the High Court erred in holding the appellant defaulted in rent payment due to lack of pleadings and evidence. The appeal was dismissed with no orders as to costs.
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2005 (4) TMI 620
Issues Involved:
1. Notification and validity of route schemes.
2. Issuance and recall of permits.
3. Legal proceedings and decisions by various courts and tribunals.
4. Applicability of the principle of res judicata.
5. Prohibition of private operators on notified routes.
Detailed Analysis:
1. Notification and Validity of Route Schemes:
The case revolves around the notification of routes under different schemes. The route from Bijnore Noorpur-Chandpur was first notified on February 12, 1952. Another scheme for the route from Bijnore to Muzaffarnagar was notified on October 15, 1962, with operations commencing on November 15, 1962. A subsequent notification on September 28, 1977, and a modification on September 3, 1994, further defined the routes. The relevant portions of these notifications were crucial in determining the legality of the permits issued.
2. Issuance and Recall of Permits:
The State Transport Authority of U.P. granted 38 regular stage carriage permits on June 14-15, 1993, for the route Muzaffarnagar-Chhajlet via Gangabridge, Bijnor, and Noorpur. However, only 11 permits were initially issued. Following a series of writ petitions and interim orders, the Secretary, State Transport Authority, issued and later recalled these permits, leading to further litigation. The High Court's order dated September 26, 1997, directed the issuance of permits to all grantees, which was challenged by UPSRTC.
3. Legal Proceedings and Decisions by Various Courts and Tribunals:
The initial writ petitions challenged the issuance of permits and were decided by the Division Bench of the Allahabad High Court, which quashed the Secretary's order and directed the issuance of permits. This decision was appealed, leading to a remand by the Supreme Court to the State Transport Appellate Tribunal (STAT). The STAT's decision was again contested, resulting in multiple writ petitions and special leave petitions (SLPs) before the Supreme Court. The High Court's decisions were ultimately set aside by the Supreme Court, which highlighted the oversight regarding the notified routes.
4. Applicability of the Principle of Res Judicata:
The Supreme Court clarified that the principle of res judicata did not apply in this case. The dismissal of SLPs in limine does not amount to upholding the High Court's decisions. The Court referenced several precedents to establish that non-speaking orders of dismissal do not imply a decision on the merits of the case. Therefore, the High Court's orders did not merge with the Supreme Court's orders, and the issues could be reconsidered.
5. Prohibition of Private Operators on Notified Routes:
The Supreme Court emphasized that once a route is notified under a scheme, private operators cannot be permitted to operate on that route unless the scheme is amended. The 1952 notification for the Bijnor-Noorpur route and the 1994 notification for the Muzaffarnagar-Bijnor route were both schemes of total exclusion, prohibiting the issuance of permits to private operators. The Court cited the Karnataka State Road Transport Corporation case to reinforce this principle.
Conclusion:
The Supreme Court allowed the appeals, setting aside the High Court's order dated September 26, 1997, and dismissed the writ petitions. The Court held that the issuance of permits on the notified routes was illegal and could not be sustained. The decision underscored the importance of adhering to notified schemes and the prohibition of private operators on such routes without proper amendments to the schemes.
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2005 (4) TMI 619
Issues:
1. Jurisdiction of Civil Court under Section 34 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002.
2. Interpretation of Section 34 in relation to jurisdiction of Debt Recovery Tribunal.
3. Applicability of Debt Recovery Tribunal's jurisdiction based on amount involved.
4. Scope of revisional jurisdiction under Section 115 CPC.
Analysis:
1. Jurisdiction of Civil Court under Section 34 of the Securitisation Act:
The petitioner and respondent No.2 filed applications under Order 7 Rule 11 CPC seeking rejection of the plaint, claiming that the jurisdiction of the Civil Court was barred under Section 34 of the Securitisation Act due to a notice issued under Section 13 (2) of the Act. The Civil Judge dismissed the applications, stating that the bar of Section 34 would not apply since the amount sought to be recovered was less than Rs. 10.00 lakhs, and only matters above this threshold could be entertained by the Debt Recovery Tribunal (DRT).
2. Interpretation of Section 34 in relation to jurisdiction of Debt Recovery Tribunal:
The High Court analyzed the provisions of the Securitisation Act and the DRT Act to determine the scope of the Debt Recovery Tribunal's jurisdiction. It was noted that Section 34 of the Act restricts the jurisdiction of Civil Courts where matters fall within the purview of the DRT or the Appellate Tribunal empowered by the DRT Act. The Court clarified that the Securitisation Act applies to cases where the DRT and Appellate Tribunal derive their powers from the DRT Act, emphasizing that the bar of Section 34 does not extend to cases involving amounts below Rs. 10.00 lakhs.
3. Applicability of Debt Recovery Tribunal's jurisdiction based on amount involved:
The Court highlighted that the DRT Act specifies that the DRT has jurisdiction over matters where the amount involved exceeds Rs. 10.00 lakhs. In the present case, the security interest of the petitioner and respondent No.2 was below this threshold, rendering the DRT without jurisdiction to entertain the matter. As a result, the bar of Section 34 of the Securitisation Act did not apply, and the Civil Court retained jurisdiction to grant injunctions, as observed in the impugned order.
4. Scope of revisional jurisdiction under Section 115 CPC:
The Court reiterated the limited scope of revisional jurisdiction under Section 115 CPC, emphasizing that interference is warranted only in cases of jurisdictional errors, illegality, or material irregularity. The judgment emphasized that findings of fact by lower courts cannot be reversed in the exercise of revisional powers. Consequently, the petition was dismissed, upholding the decision of the Civil Judge regarding the jurisdiction of the Civil Court under Section 34 of the Securitisation Act.
In conclusion, the High Court's judgment clarified the interplay between the Securitisation Act, the DRT Act, and the jurisdiction of Civil Courts, ultimately affirming the Civil Court's jurisdiction in cases where the amount involved does not meet the threshold for DRT intervention. The decision underscored the importance of statutory provisions and jurisdictional boundaries in determining the appropriate forum for resolving disputes related to financial assets and security interests.
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2005 (4) TMI 618
Issues Involved:
1. Illegal transfer of shares.
2. Compliance with Section 108 of the Companies Act, 1956.
3. Validity of the gift of shares.
4. Limitation period for filing the petition.
5. Equitable relief and rectification of the register of members.
Detailed Analysis:
1. Illegal Transfer of Shares:
The petitioner claimed that 39,741 equity shares held in M/S Pentagon Drugs Private Limited were illegally transferred to the 2nd respondent. The petitioner argued that he was coerced by the 3rd respondent to sign blank transfer forms and an undated resignation letter to protect his daughter from harassment. The petitioner did not hand over any share certificates as none were issued by the company. Upon inspecting the company records in March 2001, the petitioner discovered the shares had been transferred on 31.12.1997 without his consent. The respondents contended that the petitioner had gifted the shares to the 3rd respondent, who then transferred them to the 2nd respondent.
2. Compliance with Section 108 of the Companies Act, 1956:
The petitioner argued that the transfer was invalid as it did not comply with Section 108, which mandates proper execution of transfer instruments and consideration for the transfer. The respondents countered that the transfer was a gift, not requiring consideration, and that the petitioner had acquiesced to the transfer by his conduct.
3. Validity of the Gift of Shares:
The petitioner denied gifting the shares, asserting that no consideration was given, and the transfer forms were signed under coercion. The respondents maintained that the shares were gifted as part of an arrangement to mobilize funds for the company. The court found no evidence of a gift, noting the absence of a written document or share certificates. The court held that the mere handing over of blank transfer forms did not constitute a gift.
4. Limitation Period for Filing the Petition:
The respondents argued that the petition was time-barred, as it was filed more than three years after the transfer. They suggested that the knowledge of the petitioner's daughter, who attended the Board Meeting approving the transfer, should be imputed to the petitioner. The petitioner claimed he only became aware of the transfer in March 2001. The court held that the limitation period started from the date of the petitioner's knowledge of the transfer, making the petition timely.
5. Equitable Relief and Rectification of the Register of Members:
The court acknowledged that the transfer of shares without consideration was null and void. However, considering the company's control and management by the 2nd respondent for nearly eight years and the strained relationship between the parties, the court deemed rectification of the register not in the company's best interest. Instead, the court directed the 2nd and 3rd respondents to pay consideration for the shares based on the price at which the 5th respondent's shares were transferred to the 3rd respondent. If the consideration was not paid by 31.5.2005, the company was directed to rectify the register by 15.6.2005.
Conclusion:
The petition was disposed of with the court ordering the 2nd and 3rd respondents to pay consideration for the shares or face rectification of the register of members.
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2005 (4) TMI 617
Issues Involved:
1. Levy of additional tax under section 143(1A) when there is a reduction in returned loss due to adjustments.
2. Validity of adjustments made by the Assessing Officer under section 143(1)(a) for the assessment years 1989-90 and 1990-91.
3. Applicability of Rule 27 of the Income-tax (Appellate Tribunal) Rules, 1963, allowing the respondent to support the order on grounds decided against them.
Detailed Analysis:
1. Levy of Additional Tax Under Section 143(1A):
The primary issue was whether additional tax under section 143(1A) is leviable if there is a variation between the returned income/loss and the income/loss finally determined on processing the return under section 143(1)(a). The CIT(A) initially held that no additional tax is leviable in cases where returned loss is reduced to a smaller loss by adjustments, relying on the decisions of the Punjab and Haryana High Court in CIT v. Prithipal Singh & Co. and the Delhi High Court in Mody Cement Ltd.
However, the department argued that due to a retrospective amendment to section 143(1A), additional tax is leviable even when there is a reduction in the returned loss. The Tribunal acknowledged this retrospective amendment, which clarified that additional tax is applicable even in cases of reduced loss.
2. Validity of Adjustments Made by the Assessing Officer:
For the assessment year 1989-90, the Assessing Officer made several adjustments, including the disallowance of investment allowance due to non-creation of reserve, disallowance under Rule 6D, payment to Diners Club, and disallowance under section 43B for ESIS payments and entertainment expenses. The CIT(A) held that the disallowances related to ESIS payments and entertainment expenses were not prima facie adjustments, and thus, these adjustments were to be amended. However, the disallowance of investment allowance was upheld by the CIT(A) on the ground that the required reserve was not created.
For the assessment year 1990-91, the adjustments included disallowances under section 43B for unpaid sales tax and unpaid interest on loans from financial institutions. The CIT(A) deleted the disallowance related to unpaid sales tax but upheld the disallowance for unpaid interest due to lack of evidence regarding conversion into term loans.
3. Applicability of Rule 27:
The Tribunal considered whether the respondent (assessee) could invoke Rule 27 of the Income-tax (Appellate Tribunal) Rules, 1963, to support the order of the CIT(A) on grounds decided against them. The Tribunal noted that Rule 27 allows the respondent to support the order appealed against on any ground decided against them, even if they did not file a cross-appeal or cross-objection. The Tribunal emphasized that the ultimate result of the CIT(A)'s order was in favor of the assessee, and the department would not be worse off by filing an appeal before the Tribunal.
Separate Judgments:
The Judicial Member disagreed with the Accountant Member regarding the applicability of Rule 27 for the adjustment of investment allowance. The Judicial Member held that the assessee had not raised the issue of jurisdiction of the Assessing Officer before the CIT(A) and thus, could not raise it for the first time before the Tribunal. The Judicial Member also emphasized that the appellant (department) should not be made worse off by the appeal.
Third Member Decision:
The President, acting as the Third Member, agreed with the Accountant Member's view that the assessee could invoke Rule 27 to support the CIT(A)'s order on grounds decided against them. The Third Member held that the adjustment of investment allowance was not permissible under section 143(1)(a) and thus, the levy of additional tax under section 143(1A) was not justified. The Third Member emphasized that the claim for investment allowance should be quantified and carried forward even in the year of loss, as supported by various High Court decisions and CBDT circulars.
Conclusion:
The Tribunal ultimately held that the adjustments made by the Assessing Officer under section 143(1)(a) were not justified, and thus, the levy of additional tax under section 143(1A) was not applicable. The Tribunal allowed the appeals of the department partly for statistical purposes, emphasizing the importance of following the principles laid down in Rule 27 and the retrospective amendment to section 143(1A).
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2005 (4) TMI 616
Issues involved:
1. Validity of the Amendment Act of 1979.
2. Jurisdiction of the Land Tribunal post the declaration of the Amendment Act as ultra vires.
3. Application of the de facto doctrine in saving orders passed by the Tribunal.
4. Interpretation of the High Court judgment regarding the entire Amendment Act being declared ultra vires.
5. Invocation of the doctrine of stare decisis to maintain settled position.
6. Clarification on the jurisdiction of the Land Tribunal and Deputy Commissioner post the High Court judgment.
7. Disposal of the appeals and remittance of matters to the High Court for further consideration.
Analysis:
1. Validity of the Amendment Act of 1979:
The judgment dealt with the validity of the Karnataka Inams Abolition (Amendment) Act, 1979, which was challenged in various writ petitions. The High Court had declared the entire Amendment Act as ultra vires in a judgment dated 24.4.1992. The Supreme Court observed that the High Court's declaration was too broad, as the issues raised in the writ petitions were specific to the amendments related to religious and charitable Inams only. The Supreme Court set aside the part of the judgment declaring the entire Amendment Act void and confined the declaration to the provisions amending the Mysore Act 18 of 1955.
2. Jurisdiction of the Land Tribunal:
The jurisdiction of the Land Tribunal came into question post the High Court's declaration of the Amendment Act as ultra vires. The Land Tribunal had granted occupancy rights in a specific case post the declaration. The High Court held that the Land Tribunal lacked jurisdiction due to the invalidation of the Amendment Act. The Supreme Court, considering the de facto doctrine, saved the orders passed by the Tribunal until the Act was declared ultra vires. However, orders passed post the declaration were deemed without jurisdiction, leading to the remittance of matters to the Deputy Commissioner for further adjudication.
3. Application of the de facto doctrine:
The de facto doctrine was applied to save orders passed by the Land Tribunal until the Amendment Act was declared ultra vires. This doctrine aimed to maintain stability in decisions made during the period when the Tribunal was deemed to lack jurisdiction. The Supreme Court emphasized the importance of this doctrine in preserving settled positions and avoiding unnecessary disruptions in ongoing matters.
4. Interpretation of High Court judgment:
The High Court's judgment declaring the Amendment Act as ultra vires was analyzed in detail. The Supreme Court found that the High Court's broad declaration was unwarranted, as the issues raised in the writ petitions were specific to certain amendments only. The Supreme Court corrected this by confining the declaration to the relevant provisions, ensuring a more precise and legally sound interpretation of the High Court's decision.
5. Invocation of the doctrine of stare decisis:
The doctrine of stare decisis was invoked to maintain the settled position post the High Court's declaration of the Amendment Act as ultra vires. The Supreme Court recognized the potential consequences of unsettling the jurisdictional framework and emphasized the importance of adhering to established decisions to avoid confusion and maintain consistency in legal matters.
6. Clarification on jurisdiction post-High Court judgment:
The Supreme Court clarified the jurisdictional implications post the High Court's judgment regarding the Amendment Act. It directed that the jurisdiction would now be exercised by the Land Tribunal, including matters pending before the Deputy Commissioner. This decision aimed to provide clarity on the authority responsible for adjudicating relevant matters moving forward, while also allowing parties to challenge the validity of the Amendment Act in specific contexts.
7. Disposal of appeals and remittance of matters:
The Supreme Court allowed the appeals and set aside the impugned judgment, remitting the matters to the High Court for further consideration on merit in accordance with the law. The directive emphasized the need for expedited resolution of the pending appeals to ensure timely adjudication and resolution of the legal issues at hand.
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2005 (4) TMI 615
Suit for specific performance of contract - Agreement of sale - Whether the plaintiff-Respondents were all along and still are ready and willing to perform their part of contract as is mandatorily required u/s 16(c) of the Specific Relief Act - HELD THAT:- In the instant case, the First Respondent herein, however, raised a specific plea that he was a debtor and that the deed of mortgage was executed only because the Appellants were not licensed money lenders. He not only approached the competent authority under the Maharashtra Debt Relief Act for a declaration that he was a debtor and stood discharged from his debt, but also in the plaint he sought for a decree for possesion of the suit land on the premise that the provisions of the Maharashtra Debt Relief Act were attracted. He even asked for a decree of accounting.
Reading the plaint as a whole, it becomes evident that the First Respondent principally raised a contention that the transaction was of mortgage and the sale stood redeemed and he was discharged from the debt. He moreover prayed for a decree for accounting, but contended that only in the event, such prayer is not granted, he was ready to pay the defendants the said sum of ₹ 45,000/- The averments made in the pleadings must be construed reasonably and so read the statement made as regard purported readiness and willingness to pay the stipulated amount to the defendants according to the conditions mentioned in the agreement cannot be read in isolation.
It is now well-settled that the conduct of the parties, with a view to arrive at a finding as to whether the plaintiff-Respondents were all along and still are ready and willing to perform their part of contract as is mandatorily required u/s 16(c) of the Specific Relief Act must be determined having regard to the entire attending circumstances. A bare averment in the plaint or a statement made in the examination-in-chief would not suffice. The conduct of the plaintiff-Respondents must be judged having regard to the entirety of the pleadings as also the evidences brought on records.
Power of the Appellate Court in intra court appeal is not exactly the same as contained in Section 100 of the Code of Civil Procedure but it is also well-known that entertainment of a Letters Patent Appeal is discretionary and normally the Division Bench would not, unless there exist cogent reasons, differ from a finding of fact arrived at by the learned Single Judge. Even as noticed hereinbefore, a court of first appeal which is the final court of appeal on fact may have to exercise some amount of restraint.
Thus, the impugned judgment cannot be sustained which is set aside accordingly. The appeal is allowed.
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2005 (4) TMI 614
The Supreme Court of India dismissed the special leave petitions as withdrawn because the assessment reopening under Section 151 of the Income Tax Act was not done with the required permission from the Chief Commissioner. The petitioners were advised to approach the High Court for review.
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2005 (4) TMI 613
Issues Involved:
1. Enforceability of the agreement for fixation of rent through Government valuers.
2. Jurisdiction of Civil Court versus Rent Controller under the West Bengal Premises Tenancy Act, 1956.
3. Applicability of Section 23 of the Contract Act in the context of the West Bengal Premises Tenancy Act, 1956.
4. Validity of specific performance of an agreement that conflicts with statutory provisions.
Issue-wise Detailed Analysis:
1. Enforceability of the agreement for fixation of rent through Government valuers:
The core issue was whether the agreement between the parties to appoint Government valuers for fixing the rent could be specifically enforced. The plaintiff-landlord sought specific performance of an agreement where both parties agreed to appoint Government valuers to assess the valuation of the Godown and fix the rent as per Government Rules. The defendant had not honored this agreement, prompting the lawsuit.
2. Jurisdiction of Civil Court versus Rent Controller under the West Bengal Premises Tenancy Act, 1956:
The defendant contended that the Civil Court had no jurisdiction to enforce such an agreement, as the matter of fixation of fair rent or increase of existing rent should be addressed by the Rent Controller as per Sections 8 to 12 of the West Bengal Premises Tenancy Act, 1956. The learned Trial Judge, however, overruled this objection and passed a preliminary decree for specific performance, which was challenged in the appeal.
3. Applicability of Section 23 of the Contract Act in the context of the West Bengal Premises Tenancy Act, 1956:
The appellant argued that the agreement to refer the dispute to Government valuers for rent assessment was violative of the West Bengal Premises Tenancy Act and thus hit by Section 23 of the Contract Act, which renders agreements void if they are contrary to public policy or statutory provisions. The appellant relied on several precedents to support this contention.
4. Validity of specific performance of an agreement that conflicts with statutory provisions:
The respondent countered that the West Bengal Premises Tenancy Act did not explicitly bar alternative methods of rent fixation agreed upon by the parties. The respondent cited various judgments to argue that the agreement should be enforceable. However, the court held that statutory provisions based on public policy, such as those in the West Bengal Premises Tenancy Act, cannot be overridden by mutual agreements that are inconsistent with those provisions.
Judgment Analysis:
The court concluded that the West Bengal Premises Tenancy Act, 1956, being a statute based on public policy, mandates specific procedures for rent fixation and enhancement, which cannot be bypassed by mutual agreement. The court emphasized that Sections 8 to 12 of the Act provide the exclusive mechanism for determining fair rent and any agreement contrary to these provisions cannot be specifically enforced.
The court held that the learned Trial Judge erred in law by granting a decree for specific performance of an agreement that was in conflict with the statutory provisions of the West Bengal Premises Tenancy Act. The court reiterated that if the landlord believes the existing rent is inadequate, the proper recourse is to approach the Rent Controller, not to enforce an agreement that contravenes the Act.
The court set aside the judgment and decree of the learned Trial Judge and allowed the appeal, emphasizing that statutory provisions cannot be waived or altered by private agreements if they are designed to protect public policy interests.
The appeal was allowed, and the previous interim direction for depositing specified amounts was recalled, permitting the appellant to withdraw the deposited amount. The court did not award any costs, considering the facts and circumstances of the case.
Separate Judgment:
R.N. Sinha, J., concurred with the judgment delivered, agreeing with the analysis and conclusions reached.
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