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2007 (5) TMI 678
Issues Involved:
1. Regularization of ad hoc teachers.
2. Compliance with the Supreme Court's order dated 06.12.1989.
3. Creation and identification of sanctioned posts.
4. Validity of appointments made by the committee constituted by the High Court.
5. Adherence to statutory provisions and qualifications for the post of lecturers.
Detailed Analysis:
1. Regularization of Ad Hoc Teachers:
The appellants, an association of ad hoc teachers, sought regularization of their services. The Supreme Court had previously directed that ad hoc teachers in service on February 10, 1989, against sanctioned posts, should continue until selections were made by the University Service Commission. The Court also mandated that the Government consider the workload and sanction additional posts if required, which should be filled regularly either by direct recruitment or promotion, not by ad hoc appointments.
2. Compliance with the Supreme Court's Order Dated 06.12.1989:
The Supreme Court's order aimed to address the unsatisfactory situation of repeated ad hoc appointments. The order directed the University Service Commission to advertise posts for direct recruitment, the Government to sanction additional posts based on workload, and relaxation of the maximum age for direct recruitment to account for service rendered as ad hoc teachers. The appellants contended that the order was not complied with, leading to a contempt petition which was later discharged by the Court.
3. Creation and Identification of Sanctioned Posts:
During the pendency of the matter, Magadh University had proposed the creation of 1467 additional posts, including 426 for the appellant university. However, the State of Bihar and the University disputed this, stating only 55 posts were sanctioned. The High Court, through a consent order, constituted a committee to identify vacant posts as of May 30, 1990. The appellants were dissatisfied with this arrangement and sought a review, which was denied.
4. Validity of Appointments Made by the Committee Constituted by the High Court:
The High Court's consent order involved appointing a committee to identify vacant posts, which the appellants argued was beyond the Court's jurisdiction and contrary to the statutory provisions of the Bihar State University Act. They contended that the appointments should have been made by the University Service Commission, a statutory body, and not by a committee of Vice Chancellors.
5. Adherence to Statutory Provisions and Qualifications for the Post of Lecturers:
The Supreme Court emphasized that any appointment made in violation of the constitutional scheme of equality and statutory provisions would be illegal. The Bihar State University Act mandates that all sanctioned vacant posts be filled by qualified candidates selected by the University Service Commission. The Court noted that the qualifications for lecturers had been updated per University Grants Commission guidelines, and any deviation could risk derecognition of the universities.
Conclusion:
The Supreme Court dismissed the appeals and interlocutory applications, directing that the respondents consider the cases of all teachers with requisite qualifications, upon relaxation of age if permissible by law, along with other eligible candidates. The Court allowed the State of Bihar and concerned universities to terminate the services of teachers not working against sanctioned posts or those who did not fulfill the requisite qualifications. The Court reiterated the importance of adhering to statutory provisions and condemned the practice of appointing ad hoc teachers.
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2007 (5) TMI 677
Issues Involved:
1. Legitimacy of the High Court's reversal of the Trial Court's acquittal.
2. Credibility and reliability of the eye-witnesses.
3. Adequacy of the prosecution's evidence.
4. Examination of independent witnesses.
5. Motive behind the crime.
Summary:
1. Legitimacy of the High Court's Reversal of the Trial Court's Acquittal:
The appellants challenged the High Court's judgment that overturned the Trial Court's acquittal. The Supreme Court noted that the High Court was justified in setting aside the acquittal as the Trial Court's judgment was found to be "highly unsatisfactory" and based on "irrelevant or inadmissible evidence." The High Court meticulously addressed each reason provided by the Trial Court and found the acquittal to be perverse and unreasonable.
2. Credibility and Reliability of the Eye-Witnesses:
The Trial Court doubted the presence and testimony of the eye-witnesses (PW-5, PW-8, PW-12, and PW-13) due to their familial relationship with the deceased and their alleged failure to raise an alarm during the incident. However, the Supreme Court observed that the eye-witnesses were not inimical to the accused and had no reason to falsely implicate them. The High Court found the eye-witnesses' testimonies credible and reliable, noting that their evidence was consistent with the medical evidence.
3. Adequacy of the Prosecution's Evidence:
The Trial Court disbelieved the prosecution's case on several grounds, including the absence of independent witnesses and the alleged improvements in the eye-witnesses' testimonies. The Supreme Court, however, found no basis for these conclusions and emphasized that the eye-witnesses' evidence was sufficient to establish the guilt of the appellants beyond reasonable doubt.
4. Examination of Independent Witnesses:
The appellants argued that the non-examination of independent witnesses weakened the prosecution's case. The Supreme Court noted that there is no "straight jacket formula" regarding the necessity to examine independent witnesses and that the credibility of the eye-witnesses was sufficient in this case. The Court also highlighted that the presence of villagers at the crime scene did not necessarily mean they were all eye-witnesses.
5. Motive Behind the Crime:
The prosecution established that the motive for the crime was the appellants' grievance against the deceased for neglecting their sister, Kalawati. The Trial Court found this motive unrealistic, but the Supreme Court disagreed, stating that the motive was plausible and supported by the evidence on record.
Conclusion:
The Supreme Court upheld the High Court's judgment, finding no merit in the appeal and dismissing it. The High Court's decision to convict the appellants u/s 302 read with Section 34 IPC and sentence them to life imprisonment was affirmed.
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2007 (5) TMI 676
Issues Involved:
1. Authority and jurisdiction of CMD to pass the dismissal order.
2. Validity and enforcement of the amended CDA Rules.
3. Right of appeal and potential prejudice to the respondent.
Summary:
1. Authority and Jurisdiction of CMD to Pass the Dismissal Order:
The High Court set aside the dismissal order passed by the CMD on 21.1.1997 and the Appellate Authority's order dated 27.9.1997, holding that the CMD did not have the authority to dismiss the respondent as per the unamended CDA Rules, which designated the Board as the Disciplinary Authority. The Supreme Court, however, found that the Board's resolution dated 18.3.1998 ratified the CMD's dismissal order, validating it retrospectively. The Court cited Maharashtra State Mining Corporation v. Sunil, emphasizing that an invalid act can be ratified by the competent authority, making it valid from the date of the original act.
2. Validity and Enforcement of the Amended CDA Rules:
The High Court held that the amendment to the CDA Rules did not come into effect because the date of enforcement was not stated in the amendment itself but in a subsequent circular. The Supreme Court disagreed, noting that the Board's resolution on 18.3.1998 clarified that the amendments were effective from 8.1.1996, the date when the majority of Directors approved the circular resolution. The Court concluded that Rule 41 of the CDA Rules, which requires the effective date to be stated in the amendment, was fully complied with.
3. Right of Appeal and Potential Prejudice to the Respondent:
The respondent argued that his right to appeal was compromised because the CMD, who issued the dismissal order, was also the designated Appellate Authority under the amended CDA Rules. The Supreme Court found no merit in this argument, noting that the respondent did file an appeal before the Board of Directors, which independently considered and dismissed the appeal. The Court referenced Balbir Chand v. Food Corporation of India Ltd., stating that a higher authority acting as the primary disciplinary authority does not inherently cause prejudice if an independent appellate review is available.
Conclusion:
The Supreme Court set aside the High Court's decision, restoring the dismissal order dated 21.1.1997 and the Appellate Authority's order dated 27.9.1997, subject to the final decision of the writ petition. The case was remanded to the High Court to consider other contentions raised by the respondent. The respondent was not entitled to subsistence allowance from the date of the Supreme Court's decision until the final disposition of the writ petition. The appeal was allowed, with parties bearing their respective costs.
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2007 (5) TMI 675
Issues involved:
The correctness of the interim order passed by the court directing payment of a specific amount within a stipulated time frame; Interpretation of the provisions of the Kerala Co-operative Societies Act regarding disputes and remedies available to parties.
Interim Order:
The appellant, a society registered under the Kerala Co-operative Societies Act, challenged an interim order directing payment of Rs. 50 lakhs to the petitioner within two months. The petitioner, a Service Co-operative Bank, sought the disbursement of certain amounts deposited as fixed deposits with the society.
Arguments:
The appellant contended that the dispute regarding non-payment/refund of the deposited amount should have been raised under section 69 of the Act before approaching the court. The appellant maintained that interest was regularly paid to the petitioner as per their agreement.
Counter-arguments:
The petitioner argued that the deposits were short term in nature and, upon refusal of refund by the society, they resorted to court intervention for relief. The petitioner emphasized the need for immediate resolution due to the society's non-compliance.
Judgment:
The court held that both parties being registered societies under the Act, any disputes should be resolved as per section 69. The court criticized the petitioner for not following the prescribed dispute resolution process before seeking court intervention. It was deemed inappropriate for the court to entertain the petition without exhausting alternative remedies. Consequently, the interim order was set aside, emphasizing that interim orders are granted in aid of the main relief, not vice versa.
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2007 (5) TMI 674
Issues Involved:
1. Whether Capexil is amenable to writ jurisdiction.
2. Formation and control of Capexil.
3. Financial aid and control over Capexil.
4. Applicability of Central Administrative Tribunal jurisdiction.
5. Dissolution clause relevance.
6. Whether Capexil qualifies as a "State" under Article 12 of the Constitution of India.
Summary:
1. Whether Capexil is amenable to writ jurisdiction:
The primary issue in this appeal is whether Capexil, previously known as Chemical & Allied Products Export Promotion Council, is amenable to writ jurisdiction. The appellant challenged the order of suspension and chargesheet issued by Capexil. The learned Single Judge held that Capexil was not amenable to writ jurisdiction, prompting this appeal.
2. Formation and control of Capexil:
The appellant argued that Capexil was an autonomous body set up with the patronage of the Ministry of Commerce, Union of India, for promoting the export of chemical and allied products. The appellant highlighted deep and pervasive control by the Central Government over Capexil, including the requirement for Central Government approval to alter the Memorandum of Association and the nomination of members by the Central Government. The respondent contended that Capexil was an autonomous body with no Central Government control, registered under the Companies Act, 1956, and operated independently.
3. Financial aid and control over Capexil:
The appellant argued that Capexil received financial grants from the Central Government, indicating government control. The respondent countered that the financial grant was insignificant compared to Capexil's total expenditure, and Capexil was primarily funded by its members through subscriptions and other financial resources. The court noted that the projects were funded by the Central Government, and the funds were used as subsidies and financial incentives to encourage export.
4. Applicability of Central Administrative Tribunal jurisdiction:
The learned Single Judge relied on the fact that CSIR was amenable to the jurisdiction of the Central Administrative Tribunal, whereas Capexil was not. The court noted that the Central Government could bring any of its allied organizations within the purview of the Central Administrative Tribunal Act, and this factor alone could not determine government control.
5. Dissolution clause relevance:
The learned Single Judge placed reliance on the dissolution clause, but the court found no relevance in this factor.
6. Whether Capexil qualifies as a "State" under Article 12 of the Constitution of India:
The court referred to the tests laid down in the case of Jogesh Chandra Mondal to determine whether a body corporate is a "State" under Article 12. These tests include the origin of the company, nature of business, monopoly business, financial aid, and deep and pervasive control of the Government. The court concluded that Capexil was set up with the active patronage of the Department of Commerce, discharging public duty on behalf of the Union, and had substantial government control. Therefore, Capexil qualifies as a "State" under Article 12 and is amenable to writ jurisdiction.
Conclusion:
The appeal succeeds, and the judgment and order of the learned Single Judge are quashed and set aside. The matter is remanded back to the learned Single Judge for a decision on merits. There would be no order as to costs.
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2007 (5) TMI 673
Issues Involved
1. Validity of the notification dated 03.08.1989 issued by Respondent No. 1.
2. Interpretation of Section 7 and Section 24A of the Chartered Accountants Act, 1949.
3. Whether the notification violates Articles 14 and 19(1)(g) of the Constitution of India.
4. Whether acquiring the Chartered Financial Analyst (CFA) qualification by Chartered Accountants constitutes professional misconduct.
Detailed Analysis
1. Validity of the Notification Dated 03.08.1989
The notification issued by Respondent No. 1 on 03.08.1989 stated that any Chartered Accountant who obtained the CFA qualification on or after 01.01.1990, or who did not surrender it before that date, would be guilty of professional misconduct under the Chartered Accountants Act, 1949. The Supreme Court found this notification to be arbitrary and unreasonable. It was held that the notification imposed excessive restrictions on Chartered Accountants, violating their fundamental rights under Articles 14 and 19(1)(g) of the Constitution. The notification was quashed.
2. Interpretation of Section 7 and Section 24A of the Chartered Accountants Act, 1949
Section 7 prohibits Chartered Accountants from using any other description in addition to or in substitution for their designation. However, the proviso allows Chartered Accountants to add other qualifications they possess. The Court interpreted this proviso to mean that qualifications other than those conferred by an Institute of Accountancy, subject to recognition by the Institute, are permissible. Section 24A prohibits awarding any degree or designation similar to that of a Chartered Accountant. The Court held that acquiring a qualification like CFA does not violate Section 7 or Section 24A, as these sections do not prohibit acquiring additional qualifications.
3. Violation of Articles 14 and 19(1)(g) of the Constitution of India
The Court held that the notification dated 03.08.1989 violated Articles 14 and 19(1)(g) of the Constitution. Article 19(1)(g) guarantees the right to practice any profession, subject to reasonable restrictions under Article 19(6). The notification imposed unreasonable restrictions by preventing Chartered Accountants from acquiring the CFA qualification, which was not justified in the public interest. The notification was deemed excessive and arbitrary, thus violating the fundamental rights of Chartered Accountants.
4. Professional Misconduct and CFA Qualification
The Court examined whether acquiring the CFA qualification by Chartered Accountants constitutes professional misconduct. It was held that acquiring additional qualifications cannot be termed as misconduct. Misconduct involves a breach of discipline or improper behavior, which does not include acquiring further education or qualifications. The Court emphasized that professional misconduct must be clearly defined and acquiring a CFA qualification does not fall within its ambit.
Separate Judgment by Markandey Katju, J.
Markandey Katju, J., concurred with the judgment and added that the financial services industry has evolved, necessitating specialized skills in financial analysis. The CFA qualification provides such skills and does not conflict with the functions of a Chartered Accountant. The notification was seen as an excessive restriction not justified by public interest, thereby violating Articles 14 and 19(1)(g). The appeal was allowed, and the notification was quashed.
Conclusion
The Supreme Court allowed the appeal, set aside the High Court's judgment, and quashed the notification dated 03.08.1989. The Court held that the notification was arbitrary, imposed unreasonable restrictions, and violated the fundamental rights of Chartered Accountants. Acquiring the CFA qualification does not constitute professional misconduct under the Chartered Accountants Act, 1949.
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2007 (5) TMI 672
Issues involved: The judgment involves the rejection of an appeal by the Kerala Sales Tax Appellate Tribunal against the orders of assessment for the assessment year 1998-99, based on questions of law raised by the assessee.
Question A: The Tribunal's error in finding that the business loss accounted for is not supported with documentary evidence.
- The Tribunal's decision was based on the lack of documentary evidence supporting the business loss accounted for by the assessee.
Question B: The Tribunal's failure to independently examine the explanation of the Revision Petitioner for projected loss.
- The Tribunal did not conduct an independent examination of the Revision Petitioner's explanation for the projected loss, which was a key issue raised by the assessee.
Question C: Justification of the Tribunal in sustaining the addition made in the sales turnover without specific cases of sales or purchase suppression.
- The Tribunal's decision to sustain the addition in the sales turnover was questioned due to the absence of specific cases of sales or purchase suppression.
Question D: The Tribunal's error in sustaining defects and rejection of returns and books of accounts without proper estimation.
- The Tribunal was criticized for sustaining defects and rejection of returns and books of accounts based on guesswork without a proper yardstick for estimation.
Legal Provision: The jurisdiction of the High Court to entertain a revision petition is limited to cases where the Tribunal has erroneously decided a question of law or failed to decide a question of law.
Conclusion: The High Court concluded that the questions raised by the assessee were not questions of law but rather questions of fact. Therefore, the revision petition was not entertained and was rejected. The assessee was granted two months to pay the dues under the Act for the assessment year 1998-99.
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2007 (5) TMI 671
Issues Involved:
1. Alleged acts of oppression and mismanagement.
2. Appointment of directors.
3. Removal of a director.
4. Alleged manipulation of share allotment.
5. Alleged forgery in share transfer.
6. Alleged siphoning off of funds.
7. Validity of affidavits and consent letters.
8. Alleged suppression of material facts.
9. Alleged misconduct in another company petition.
10. Fiduciary duties of directors.
11. Specific reliefs sought by petitioners.
Detailed Analysis:
1. Alleged Acts of Oppression and Mismanagement:
The petitioners alleged that the respondents, particularly R-3, engaged in acts of oppression and mismanagement in the affairs of the company, violating sections 397 and 398 of the Companies Act, 1956. The petitioners claimed that their majority representation on the Board was reduced through illegal appointments and share allotments, constituting acts of oppression.
2. Appointment of Directors:
The petitioners contended that the appointment of R-4, R-5, and R-6 as directors on 1-12-2004 was illegal and aimed at creating a new majority on the Board. The respondents argued that the appointments were valid and in compliance with the law. However, the petitioners provided evidence showing discrepancies in the documentation, leading to the conclusion that the appointments were not legally compliant.
3. Removal of a Director:
The petitioners argued that the removal of P-1 as a director was illegal, as sections 190 and 284 of the Act were not complied with. The respondents claimed that the removal was due to P-1 advancing a loan of Rs. 64.50 lakhs to relatives without proper authorization. The Board found that the removal process was flawed and did not comply with statutory requirements, thus restoring P-1 as a director.
4. Alleged Manipulation of Share Allotment:
The petitioners alleged manipulation in the allotment of shares, specifically pointing out discrepancies in Form No. 2 filed with the ROC. The respondents argued that the allotments were valid and in compliance with the law. However, the Board found that the share allotments were not properly documented and amounted to creating a new majority, which was deemed oppressive and illegal.
5. Alleged Forgery in Share Transfer:
The petitioners claimed that the transfer of 5,000 shares from P-2 to R-3 was forged, with discrepancies in the transfer deeds and signatures. The respondents provided a handwriting expert's report to validate the signatures, but the Board found the petitioners' allegations credible, noting the lack of original transfer deeds and discrepancies in the documentation.
6. Alleged Siphoning Off of Funds:
The petitioners accused the respondents of siphoning off approximately Rs. 40 lakhs from the company's accounts. The respondents denied these allegations but failed to provide satisfactory explanations for specific entries. The Board found that the respondents had not adequately rebutted the allegations, leading to the conclusion that funds had been misappropriated.
7. Validity of Affidavits and Consent Letters:
The respondents challenged the validity of the affidavits and consent letters filed by the petitioners, arguing that they were irregular and not in compliance with the Company Law Board Regulations, 1991. The Board found that the technical defects in the affidavits had been rectified, and the consent letters were valid as the respondents did not deny the petitioners' shareholding.
8. Alleged Suppression of Material Facts:
The respondents accused the petitioners of suppressing material facts, such as omitting article 6 from the Articles of Association. The Board found that while there were omissions, these were not sufficient to dismiss the petition at the threshold, given the overall circumstances and the need for substantial justice.
9. Alleged Misconduct in Another Company Petition:
The respondents pointed to the petitioners' conduct in another company petition (CP No. 71/05) to argue that they had not come with clean hands. The Board considered these allegations but found that the petitioners had provided satisfactory explanations for their actions in the other proceedings.
10. Fiduciary Duties of Directors:
The Board emphasized that directors have fiduciary duties to act in the best interest of the company and its shareholders. The respondents' actions in appointing new directors, removing P-1, and manipulating share allotments were found to be in breach of these fiduciary duties, constituting acts of oppression and mismanagement.
11. Specific Reliefs Sought by Petitioners:
The Board granted the following reliefs:
- Declared the appointment of R-4, R-5, and R-6 as directors null and void.
- Restored P-1 as a director.
- Declared the resolutions for change in authorized signatories null and void.
- Declared the allotment of 4,250 shares to R-3 and R-8 null and void.
- Declared the annual accounts and returns filed with the ROC for the year ending 31-3-2005 null and void.
- Directed the respondents to restore the siphoned-off funds to the company's accounts.
The petition was allowed, and all interim orders were vacated. The Board emphasized the need for substantial justice and the importance of directors' fiduciary duties in its judgment.
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2007 (5) TMI 670
Issues involved: Interpretation of Section 43B of the Income Tax Act, 1961 regarding the deductibility of employer's contributions to Provident Fund, Family Pension, State Insurance, and Deposit Linked Insurance.
Judgment Summary:
Issue 1: Interpretation of Section 43B
The main issue in this case was whether the employer's contribution "payable, but not actually paid" is eligible for deduction under Section 43B of the Income Tax Act, 1961. The Tribunal relied on a decision of the Andhra Pradesh High Court, but it was found that the Tribunal misinterpreted the said decision.
Issue 2: Applicability of Deductions
The words of Section 43B clearly state that deductions are limited to actual payments. The Karnataka High Court's decision in the case of CIT v. Amco Batteries was cited, emphasizing that unless the sums are actually paid, the employer cannot claim deductions.
Conclusion
The High Court held that the Appellate Tribunal was incorrect in ruling that the employer's contributions to various funds were not disallowable under Section 43B. Contributions that were payable but not actually paid during the relevant year were deemed to be disallowable. The Court approved the decision of the Karnataka High Court regarding the interpretation of Section 43B. The reference was disposed of accordingly.
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2007 (5) TMI 669
Issues Involved:
1. Legality of the promotion process for the post of Headmaster.
2. Evaluation of merit and ability versus seniority.
3. Jurisdiction and authority of the appellate body.
4. Relevance of extraneous factors in the decision-making process.
Detailed Analysis:
1. Legality of the promotion process for the post of Headmaster:
The recruitment and promotion to the post of Headmaster in Tamil Nadu are governed by the Tamil Nadu Recognised Private Schools (Regulation) Act, 1973, and the Tamil Nadu Private Schools (Regulation) Rules, 1974. Rule 15(4) stipulates that promotion should be based on merit and ability, with seniority considered only when merit and ability are approximately equal. The Managing Committee of the school evaluated the appellant and respondent No. 1 and concluded that the appellant had superior merit and ability. Consequently, the appellant was appointed as Headmaster.
2. Evaluation of merit and ability versus seniority:
The Joint Director of School Education initially dismissed the appeal against the appellant's appointment. However, a Division Bench remanded the matter back to the Joint Director, instructing a reassessment strictly within the scope of Rule 15. Upon reassessment, the Joint Director found that both candidates had equal merit and ability, and since respondent No. 1 was senior, he should be appointed as Headmaster. The appellant challenged this decision, arguing that the Joint Director failed to consider relevant factors and based the decision on irrelevant criteria.
3. Jurisdiction and authority of the appellate body:
The appellate authority has plenary power to consider educational qualifications and other activities of the candidates. However, it must exercise this power while respecting the views of the Managing Committee. The High Court remanded the matter to the Joint Director with specific instructions to consider the case within the scope of Rule 15. The appellate authority's decision was challenged for considering irrelevant factors and not adhering to the statutory requirements.
4. Relevance of extraneous factors in the decision-making process:
The appellate authority considered various factors such as computer training, certificates in unrelated subjects, participation in conferences, and extracurricular activities like acting in dramas and serving in Home-guards. The Supreme Court found that many of these factors were irrelevant to the assessment of merit and ability for the post of Headmaster. The Court emphasized that the decision should be based on relevant qualifications and contributions directly related to the educational role.
Conclusion:
The Supreme Court set aside the High Court's judgment and remitted the matter to the Joint Director of School Education for fresh consideration in accordance with the law. The Court highlighted the importance of adhering to the statutory requirements and ensuring that decisions are based on relevant factors. The appeal was allowed, and the judgment of the High Court was overturned, with no order as to costs.
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2007 (5) TMI 668
Issues:
Setting aside ex parte assessment under Section 30 of U.P. Trade Tax Act, 1948 based on disputed tax rate for a product categorized differently by the petitioner and the respondents.
Analysis:
The judgment by the Allahabad High Court involved a writ petition concerning the setting aside of an ex parte assessment under Section 30 of the U.P. Trade Tax Act, 1948. The petitioner had moved an application for this purpose while a show cause notice was issued stating a discrepancy in the tax rate applied by the petitioner (8%) and the rate claimed by the respondents (16%) for a product, boroplus, categorized as an antiseptic cream by the respondents. The petitioner argued that only 8% tax was payable due to the nature of the product. The respondents contended that the amount leviable as per the statute should be considered. A Division Bench judgment was referred to, highlighting a similar situation where the assessee had to pay the admitted tax amount with the application, even if there was a dispute over the rate. The petitioner, paying at 8%, committed to continuing the same until a decision was reached. The court, considering the bonafide dispute, allowed the writ petition, setting aside the show cause notice and directing a merit-based decision on the petitioner's application under Section 30 of the Act.
In this case, the central issue revolved around the interpretation of Section 30 of the U.P. Trade Tax Act, specifically regarding the payment of the admitted tax amount in the context of setting aside an ex parte assessment. The court emphasized the importance of complying with the statutory provisions while acknowledging the genuine dispute between the parties regarding the tax rate applicable to the product in question. The judgment underscored the need for the petitioner to continue paying the tax at the disputed rate until a final decision was made, showcasing a cooperative approach to resolving the issue at hand. By allowing the writ petition and directing a thorough consideration of the petitioner's application on its merits, the court aimed to ensure a fair and just resolution in line with the legal framework provided by the Act.
Overall, the judgment exemplifies the court's role in adjudicating disputes arising from tax assessments under the U.P. Trade Tax Act, emphasizing the need for adherence to statutory provisions, fair consideration of conflicting interpretations, and a commitment to resolving disputes through legal processes. The decision to set aside the show cause notice and allow the petitioner to continue paying tax at the disputed rate until a final decision reflects a balanced approach aimed at upholding the principles of justice and procedural fairness in tax matters.
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2007 (5) TMI 667
Issues Involved:
1. Entitlement to additional market value and interest from the date of taking possession till the date of the award.
2. Applicability of Section 25 of the Land Acquisition Act, 1894.
3. Legality of possession taken prior to the issuance of a valid notification.
Summary:
Issue 1: Entitlement to Additional Market Value and Interest
The appeal was directed against the judgment of the Andhra Pradesh High Court, which held that the appellants were not entitled to additional market value and interest from the date of taking possession till the date of the award. The appellants argued that they were entitled to additional market value u/s 23(1)(a) of the Act from 18.05.1979. However, the High Court determined that the appellants were only entitled to additional market value and interest from the date of the second notification (23.12.1991) and not from the date of the first notification (16.03.1979), as the first notification did not survive legally.
Issue 2: Applicability of Section 25 of the Land Acquisition Act, 1894
The appellants contended that u/s 25 of the Act, the amount of compensation awarded by the court should not be less than the amount awarded by the Collector. The court clarified that Section 25 merely prohibits the reduction of the total amount of compensation awarded by the Collector and does not apply to the individual components of the award. Since the total amount of compensation was not reduced, Section 25 was deemed inapplicable in this case.
Issue 3: Legality of Possession Taken Prior to the Issuance of a Valid Notification
The court examined whether possession taken prior to a valid notification u/s 4(1) of the Act was lawful. It was held that possession must be obtained under a valid notification, and any possession taken prior to such notification is illegal. The court referenced previous judgments, including R.L. Jain (D) By L.Rs. v. DDA and Ors. and Lila Ghosh (Smt.) (Dead) Through L.R. Tapas Chandra Roy etc. v. State of West Bengal etc., which supported the view that possession taken without a valid notification is dehors the Act and cannot be recognized for the purposes of the Act.
Conclusion:
The Supreme Court generally agreed with the High Court's findings but acknowledged that the appellants should be compensated for being out of possession from 1979 to 1991. The court directed that additional interest @ 15% per annum on the amount awarded in the 1999 award for the period from 16.03.1979 till 22.12.1991 should be granted to meet the ends of justice. The appeal was allowed in part, and no costs were awarded to the appellants.
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2007 (5) TMI 666
Issues Involved:
1. Allegations of oppression and mismanagement under Sections 397 and 398 of the Companies Act, 1956.
2. Illegal appointment of additional directors.
3. Unauthorized sale of company property.
4. Unauthorized opening and operation of a new bank account.
5. Allegations of siphoning company funds and property.
Issue-wise Detailed Analysis:
1. Allegations of Oppression and Mismanagement:
The petitioners, holding 47.71% shares, alleged acts of oppression and mismanagement by the respondents, specifically against R-8. The respondents' shareholding was 37.29%, and the remaining 14.99% was held by others. The petitioners challenged the unauthorized sale of company property and the illegal appointment of additional directors. The respondents argued that the petitioners had acted against the company's interest in the past, including transferring funds to relatives and opening a new bank account without authorization.
2. Illegal Appointment of Additional Directors:
The petitioners contended that the appointment of R-3 and R-4 as additional directors was illegal and done without compliance with the Act's provisions. They argued that no board meeting took place on 1st April 2005, and the signatures on Form No. 32 were forged. The respondents claimed the appointments were valid, as the form was signed by Petitioner No. 1. However, the petitioners provided a handwriting expert's report confirming the forgery. The judgment concluded that the appointments were part of continuous acts of oppression to create a new majority and were declared null and void.
3. Unauthorized Sale of Company Property:
The petitioners alleged that the sale of Flat No. 105, Golf Apartments, was unauthorized and conducted at an inadequate consideration of Rs. 25 lakhs, significantly below the market value. The sale was executed without board authorization, and the proceeds were withdrawn on the same day. The respondents argued the sale was to pay off unsecured creditors. The judgment found the sale unauthorized, illegal, and a breach of fiduciary duties, declaring the sale null and void and directing the return of the amount drawn.
4. Unauthorized Opening and Operation of a New Bank Account:
The respondents alleged that the petitioners opened a new bank account in violation of a CLB order and siphoned funds. The petitioners argued the account was opened to deposit an Income Tax refund and other payments, as the main account was inoperative due to the CLB order. The judgment found that the petitioners' actions were explained and did not constitute contempt.
5. Allegations of Siphoning Company Funds and Property:
The respondents accused the petitioners of siphoning company property by leasing factory land to relatives at minimal rates without board approval. The petitioners contended the lease was executed with unanimous consent and in the company's interest. The judgment noted that the respondents had waived and acquiesced to the lease for seven years and could not raise the issue now.
Judgment:
The judgment concluded that the respondents' actions constituted oppression and mismanagement. It declared the appointment of R-3 and R-4 as additional directors null and void, the sale of the flat unauthorized and illegal, and directed the return of the amount drawn by the respondents. The resolutions changing authorized bank signatories were also canceled.
Order:
1. Appointment of R-3 and R-4 as additional directors declared null and void; Form No. 32 filed with the ROC also declared null and void.
2. Agreement to sell and purchase dated 7.7.2005 declared null and void; respondents restrained from entering into any mutation of the flat.
3. Respondents directed to refund the amount drawn illegally from the company's bank account.
4. Resolution changing authorized signatories canceled and declared null and void.
5. R-1 company directed to implement the above directions forthwith.
The Company Petition 71/05 was allowed, all interim orders vacated, and all CAs disposed of with no order as to costs.
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2007 (5) TMI 665
Issues Involved:
1. Entitlement to seniority based on Commissioned Service in the Army.
2. Interpretation and application of the 1968, 1973, and 1980 Rules.
3. Validity of the High Court's judgment in light of the aforementioned rules.
Summary:
Issue 1: Entitlement to Seniority Based on Commissioned Service in the Army
The primary question was whether the respondent was entitled to seniority based on his Commissioned Service in the Army. The Supreme Court examined the relevant rules and precedents to determine the respondent's entitlement.
Issue 2: Interpretation and Application of the 1968, 1973, and 1980 Rules
The 1942 Rules governed seniority based on the date of substantive appointment. The 1968 Rules provided seniority for demobilized officers commissioned during the Emergency, which was revoked in 1968. The 1973 Rules, effective for five years, reduced reservation from 20% to 10% and applied to officers commissioned between 1962-1968 and post-1971 Indo-Pak war. The 1980 Rules aimed to regularize appointments of demobilized officers whose selection process started under the 1973 Rules but did not provide for reservation. The respondent's selection process began in 1973, but he was commissioned in 1979, after the 1973 Rules expired.
Issue 3: Validity of the High Court's Judgment
The High Court's judgment was challenged on several grounds:
- The 1980 Rules were not retrospective and did not continue the 1973 Rules.
- The 1980 Rules protected only those whose recruitment process started in 1973.
- The respondent was recruited against 1984 vacancies and appointed in 1988.
- Seniority benefits were limited to Emergency Commissioned officers.
The Supreme Court held that the 1980 Rules had limited application and did not provide reservation. The respondent, commissioned in 1979, did not qualify under the 1973 Rules. The 1980 Rules did not repeal or replace the 1973 Rules but provided a new set of rules for regularizing appointments. The Court concluded that the High Court erred in granting relief to the respondent, who joined the service after the Emergency and when the 1980 Rules ceased to have force.
Conclusion:
The Supreme Court set aside the High Court's judgment, ruling that the respondent was not entitled to seniority benefits under the 1973 or 1980 Rules, as he was commissioned after the relevant period and joined the State service in 1988. The appeals were allowed with no costs.
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2007 (5) TMI 664
Issues Involved:
1. Constitutional validity of the Orissa Professional Educational Institutions (Regulation of Admission and Fixation of Fee) Ordinance, 2007, as replaced by the Orissa Professional Educational Institutions (Regulation of Admission and Fixation of Fee) Act, 2007.
2. Legislative competence of the State Legislature to enact the said Act.
3. Violation of Article 19(1)(g) of the Constitution of India by the said Act.
4. Conflict between the said Act and existing Central laws, specifically the AICTE Act, Medical Council Act, and Dentists Act.
Detailed Analysis:
1. Constitutional Validity of the Said Act:
The petitioners challenged the constitutional validity of the Orissa Professional Educational Institutions (Regulation of Admission and Fixation of Fee) Ordinance, 2007, which was later replaced by the Orissa Professional Educational Institutions (Regulation of Admission and Fixation of Fee) Act, 2007. The challenge was based on the grounds that the Act infringed upon their rights to establish and administer educational institutions, as guaranteed under Article 19(1)(g) of the Constitution.
2. Legislative Competence of the State Legislature:
The petitioners argued that the State Legislature lacked the competence to enact the said Act because the area of higher and technical education falls under Entry 66, List I of the Seventh Schedule of the Constitution, which is within the exclusive domain of the Parliament. Entry 25 of the Concurrent List, which allows the State to legislate on education, is subject to Entry 66 of List I. The petitioners contended that the field of higher education is already occupied by Central laws such as the AICTE Act, Medical Council Act, and Dentists Act, which regulate standards of education and admission procedures.
The court agreed with the petitioners, stating that the State Legislature does not have the competence to legislate in an area already occupied by Central laws. The court cited several Supreme Court judgments, including Hingir Rampur Coal Co. Ltd. v. State of Orissa, Gujarat University v. Shri Krishna Ranganath Mudhoikar, and State of Tamil Nadu v. Adhiyaman Educational & Research Institute, to support this conclusion.
3. Violation of Article 19(1)(g) of the Constitution:
The petitioners argued that the said Act imposed unreasonable restrictions on their fundamental right to establish and administer educational institutions, as guaranteed under Article 19(1)(g) of the Constitution. They contended that the Act's provisions, which mandated admissions through a Joint Entrance Examination conducted by a government-nominated Policy Planning Body and regulated fee structures through a government-dominated Fee Structure Committee, were not reasonable restrictions under Article 19(6).
The court upheld this argument, stating that the Act's provisions amounted to a complete takeover of the admission process and fee structure by the State, thereby violating the petitioners' fundamental rights under Article 19(1)(g).
4. Conflict with Existing Central Laws:
The petitioners argued that the said Act conflicted with existing Central laws, specifically the AICTE Act, Medical Council Act, and Dentists Act, which already regulate the standards of technical and medical education, including admission procedures and fee structures. The court agreed, stating that the said Act encroached upon the field occupied by these Central laws, making it unconstitutional.
The court noted that the AICTE Act empowers the All India Council for Technical Education to coordinate the development of technical education, fix norms and guidelines for charging tuition and other fees, and provide guidelines for admission of students. Similarly, the Medical Council Act and Dentists Act regulate standards of medical and dental education, including admission procedures.
The court concluded that the said Act, by abolishing the Common Entrance Test (CET) and imposing a new admission procedure and fee structure, encroached upon the field already occupied by these Central laws, thereby making it unconstitutional.
Conclusion:
The court declared the Orissa Professional Educational Institutions (Regulation of Admission and Fixation of Fee) Act, 2007, unconstitutional and struck it down as inoperative and invalid. The court held that the State Legislature lacked the competence to enact the said Act, as the field of higher and technical education is already occupied by Central laws. The court also held that the said Act violated the petitioners' fundamental rights under Article 19(1)(g) of the Constitution. The court recommended that the State Government, if it wishes to legislate in this area, must do so by following the provisions of Article 254(2) of the Constitution.
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2007 (5) TMI 663
Constitution Validity of Order Passed by HC - Decree for declaration of the title and permanent injunction constituted under West Bengal Land Reforms and Tenancy Tribunal Act - Violation of the provisions contained in Section 57B(2) of the West Bengal Estates Acquisition Act - Application for grant of special leave - provision of compensation for vesting in the West Bengal Land Reforms Act - HELD THAT:- We have indicated that the Tribunal constituted under the provision of the West Bengal Land Reforms and Tenancy Tribunal Act, is not vested with any authority to declare that a decree passed by a Civil Court is without jurisdiction and, therefore, in the case before us, the Tribunal below acted without jurisdiction in approving the contention of the State-respondent that it could ignore the decree passed by the Civil Court and maintain the record-of-rights which is at variance with the decree it has suffered.
We, therefore, set aside the order passed by the Tribunal and directed the B.L. & L.R.O concerned to correct the record-of-rights strictly in accordance with the decree passed in favour of the writ petitioner/his predecessor. The record must be corrected within one month from the date of communication of this order.
The effect of the order of stay in a pending appeal before the Apex Court does not amount to "any declaration of law" but is only binding upon the parties to the said proceedings and at the same time, such interim order does not destroy the binding effect of the judgment of the High Court as a precedent because while granting the interim order, the Apex Court had no occasion to lay down any proposition of law inconsistent with the one declared by the High Court which is impugned.
We, therefore, find substance in the contention of the writ petitioner that a Division Bench of this Court having declared the provision contained in the West Bengal Land Reforms Act regarding vesting without making any lawful provision for compensation for such vesting in the Act as ultra vires the Constitution of India, the State cannot be permitted to proceed with the said provision of vesting against the petitioner so long adequate provision is not made in the statute for compensation.
We, thus, respectfully follow the decision of the Division Bench of this Court in the case of Paschim Banga Rajya Bhumijibi Sangha, which is still binding upon us as a valid precedent and consequently, set aside the order passed by the Tribunal on the ground that without making lawful provision of compensation for vesting in the West Bengal Land Reforms Act, the State cannot go on with the process of vesting against the writ petitioner.
The order impugned herein as well as the proceedings of vesting are set aside; the writ application is allowed to the extent indicated above. This order, however, will not stand in the way of the State in continuing with the process of vesting if adequate lawful provision is incorporated in the Act for compensation for the vested land.
The writ application, thus, succeeds.
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2007 (5) TMI 662
The appeal was against setting aside the penalty for wrong availment of modvat credit on capital goods. The High Court judgment in Gaurav Merchantiles Ltd. case was cited, where duty was paid before the show cause notice. The penalty was dismissed in this case.
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2007 (5) TMI 661
Issues Involved:
1. Interpretation and application of Section 63 of the Indian Succession Act, 1925.
2. Interpretation and application of Section 68 of the Indian Evidence Act, 1872.
3. Proof of execution and attestation of a Will.
4. Admissibility and reliability of secondary evidence.
5. Examination of suspicious circumstances surrounding the execution of the Will.
Detailed Analysis:
1. Interpretation and Application of Section 63 of the Indian Succession Act, 1925:
The court emphasized that the execution of a Will must conform to Section 63 of the Indian Succession Act, which requires a Will to be attested by two or more witnesses. The court noted that the witness P.W.9 failed to satisfy this requirement as he admitted that the testatrix did not put her thumb impression in his presence, and he signed the document before the testatrix affixed her thumb impression. This discrepancy meant that P.W.9 could not be considered an attesting witness under the law.
2. Interpretation and Application of Section 68 of the Indian Evidence Act, 1872:
Section 68 mandates that the execution of a Will must be proved by at least one attesting witness. The court found that the evidence provided by P.W.9 did not meet this requirement, as his testimony was inconsistent and failed to establish that the testatrix understood and acknowledged the contents of the Will. The court also noted that P.W.4, who was presented as an attesting witness, did not actually witness the execution and thus could not fulfill the role of an attesting witness.
3. Proof of Execution and Attestation of a Will:
The court scrutinized the testimonies of the witnesses P.W.4, P.W.7, and P.W.9. P.W.9's testimony was particularly problematic as he admitted to signing the document before the testatrix and did not see her affix her thumb impression. P.W.4's testimony was inconsistent with the certified copy of the Will, and P.W.7's testimony contradicted P.W.9's account. The court concluded that the requirements for proving the execution and attestation of the Will were not met.
4. Admissibility and Reliability of Secondary Evidence:
The court addressed the issue of secondary evidence, noting that the original Will was not produced, and the respondent relied on a certified copy and a Xerox copy. The court emphasized that the loss of the original Will was not satisfactorily proved, and the discrepancies between the Xerox copy and the certified copy raised doubts about the authenticity of the secondary evidence. The court highlighted that secondary evidence could only be admitted under Section 65(c) of the Evidence Act if the loss of the original was convincingly established, which was not the case here.
5. Examination of Suspicious Circumstances Surrounding the Execution of the Will:
The court identified several suspicious circumstances, including the testatrix's age and health, her lack of independent advice, and the involvement of the respondent and his father, who were strangers to the family. The court noted that the Will and a sale deed were executed on the same day, which was not adequately explained. The court also pointed out inconsistencies in the witnesses' testimonies and the failure to produce the original Will, which suggested that the Will might not have been genuine. The court concluded that the respondent failed to remove these suspicions and prove the due execution of the Will.
Conclusion:
The Supreme Court set aside the High Court's judgment, concluding that the execution and attestation of the Will were not duly proved, and the suspicious circumstances surrounding the Will were not adequately addressed. The appeal was allowed with costs assessed at Rs. 5,000.
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2007 (5) TMI 660
Challenge the order of the High Court - Maintainability of plaint - suit dismissed for want of cause of action - suits under Order VII Rule 11 of the Code of Civil Procedure - Suits barred by limitation - renewal of an agreement or lease - HELD THAT:- In the instant case, the appellant-plaintiff did exercise their option and claimed renewal. The respondents denied their right to claim renewal in express terms and also unequivocally stated that the agreement did not stand renewed as contended by the appellants.
In the absence of a document renewing the original agreement for a further period of 5 years and in the absence of any declaration from a court of law that the original agreement stood renewed automatically upon the appellants exercising their option for grant of renewal, as is the case of the appellants, they cannot be granted relief of injunction, as prayed for in the suit, for the simple reason that there is no subsisting agreement evidenced by a written document or declared by a Court. If there is no such agreement, there is no question of enforcing clauses 15 and 20 thereof. The appellants ought to have prayed for a declaration that their agreement stood renewed automatically on exercise of option for renewal and only on that basis they could have sought an injunction restraining the respondents from interfering with their possession and operation. Having not done so, they cannot be permitted to camouflage the real issue and claim an order of injunction without establishing the subsistence of a valid agreement.
Thus, suit as well they could have sought a declaration that the agreement stood renewed automatically but such a claim would have been barred by limitation since more than 3 years had elapsed after a categoric denial of their right claiming renewal or automatic renewal by the respondents- defendants.
We have found that the real foundation for the suit was that the earlier agreement stood renewed automatically containing the same terms and conditions as in the original agreement including the negative covenants. There is neither a document to prove that the agreement stood renewed nor is there a declaration by a court that the agreement stood renewed automatically on exercise of option for renewal by the appellants. The basis for claiming the relief of injunction, namely, a subsisting renewed agreement did not exist in fact. In its absence, no relief as prayed for in the suit could be granted by the clever device of filing a suit for injunction, without claiming a declaration as to their subsisting rights under a renewed agreement, which is apparently barred by limitation.
We are, therefore, satisfied that the Trial Court as well as the High Court were justified in holding that the plaint deserved to be rejected under Order VII Rule 11 CPC since the suit appeared from the statements in the plaint to be barred by the law of limitation. We, therefore, find no merit in these appeals and the same are accordingly dismissed.
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2007 (5) TMI 659
Issues Involved:
1. Applicability of the Payment of Gratuity Act, 1972 to the Himachal Pradesh Irrigation and Public Health Department.
2. Entitlement of the workman to gratuity for the period served as a daily wage worker.
3. Applicability of the CCS (Pension) Rules, 1972 for the period of regularized service.
4. Calculation of gratuity for different periods of service.
5. Payment of interest on delayed gratuity.
Detailed Analysis:
1. Applicability of the Payment of Gratuity Act, 1972:
The State challenged the orders of the Appellate Authority and the Labour Officer-cum-Controlling Authority, arguing that the Payment of Gratuity Act, 1972 does not apply to the Himachal Pradesh Irrigation and Public Health Department. The Court held that the department qualifies as an establishment under Section 1(3) of the Payment of Gratuity Act, 1972. The judgment cited the Supreme Court's decision in State of Punjab v. The Labour Court, Jullundur, which interpreted "establishment" broadly to include entities involved in construction, maintenance, and operation of infrastructure like water supply systems.
2. Entitlement to Gratuity for Daily Wage Service:
The workman served as a daily wage worker from March 1982 to December 31, 1993, and was regularized from January 1, 1994, until his retirement on October 31, 2001. The Court ruled that the workman is entitled to gratuity for the period served on daily wages under the Payment of Gratuity Act, 1972. The Court referenced the Kerala High Court decision in Executive Engineer (Construction) Southern Railway, Quilon v. M.P. Sankara Pillai, which held that casual laborers are entitled to gratuity for their period of service before regularization.
3. Applicability of CCS (Pension) Rules, 1972:
For the period from January 1, 1994, to the date of superannuation, the workman is entitled to gratuity under the CCS (Pension) Rules, 1972. The Court found no conflict between the Payment of Gratuity Act and the CCS (Pension) Rules, allowing both to operate simultaneously for different periods of service. This interpretation aligns with the Supreme Court's ruling in Municipal Corporation of Delhi v. Dharam Prakash Sharma, which held that the Payment of Gratuity Act applies unless specifically excluded.
4. Calculation of Gratuity:
The Controlling Authority initially calculated gratuity for the entire service period from March 1982 to October 31, 2001. The Court corrected this, directing that gratuity for the period from March 1982 to December 31, 1993, be calculated under the Payment of Gratuity Act, 1972, and for the period from January 1, 1994, to October 31, 2001, under the CCS (Pension) Rules, 1972.
5. Payment of Interest:
The Court mandated the payment of interest on delayed gratuity, referencing the Supreme Court's decision in H. Gangahanume Gowda v. Karnataka Agro Industries Corporation Ltd., which held that payment of interest on delayed gratuity is a statutory compulsion. The Court directed that interest be paid at 9% per annum for the regularized period.
Conclusion:
The Court concluded that the workman is entitled to gratuity for different periods under respective legislations, with interest on delayed payments. The State was directed to comply within one month.
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