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2007 (4) TMI 746
Issues Involved:
1. Interpretation of Regulation 2.7(d)(iv) of the Central Electricity Regulatory Commission (Terms & Conditions of Tariff) Regulation, 2001.
2. Calculation of Operation and Maintenance (O&M) expenses and escalation factors.
3. Validity of the Appellate Tribunal's order setting aside CERC's decisions.
Summary:
1. Interpretation of Regulation 2.7(d)(iv):
The primary issue in these appeals is the interpretation of Regulation 2.7(d)(iv) of the CERC Regulations, 2001. The clause specifies that an escalation factor of 6% per annum shall be used to revise the base figure of O&M expenses. Deviations within 20% of this 6% (i.e., between 4.8% and 7.2%) should be absorbed by the utilities/beneficiaries. Deviations beyond this range should be adjusted based on the actual escalation factor.
2. Calculation of O&M Expenses and Escalation Factors:
The National Thermal Power Corporation (NTPC) argued that only deviations beyond the 4.8% to 7.2% range should be considered for adjustment. For example, if the escalation went to 4%, only the 0.8% deviation should be adjusted. Conversely, the utilities argued that the entire deviation from the standard 6% should be considered. The CERC initially held that O&M expenses should be calculated using the actual escalation factor, not just the marginal adjusted factor.
3. Validity of the Appellate Tribunal's Order:
The Appellate Tribunal set aside the CERC's orders, interpreting that deviations beyond the 4.8% to 7.2% range should be adjusted based on the actual escalation factor. The Supreme Court upheld this interpretation, stating that the language of Regulation 2.7(d)(iv) is clear and unambiguous. The Court emphasized that any deviation beyond the 4.8% to 7.2% range should be adjusted, and deviations within this range should be absorbed by the utilities/beneficiaries. The Court rejected the argument that the full deviation from the 6% standard should be adjusted, affirming the Appellate Tribunal's order.
Conclusion:
The Supreme Court dismissed the appeals, confirming that Regulation 2.7(d)(iv) should be interpreted literally. Deviations within the 4.8% to 7.2% range are to be absorbed by the utilities/beneficiaries, and only deviations beyond this range should be adjusted based on the actual escalation factor. The Court found no merit in the arguments for a broader interpretation and upheld the Appellate Tribunal's decision.
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2007 (4) TMI 745
Issues involved: Appeal against the rejection of RTI request for information about a company's status, directors, and pending cases.
Summary:
1. The appellant's RTI request for information about a company's status, directors, and pending cases was rejected by the Appellate Authority (AA) on the grounds that the information was already in the public domain and access was available for a predetermined fee.
2. The appellant contended that he did not ask for documents but only for information, and argued that denial of information was illegal under Section 22 of the RTI Act, stating that the Companies Act referenced by the respondents was not relevant to public access to information.
3. The respondents informed that they were willing to allow inspection of the records and documents related to the appellant's request, citing a Ministry of Company Affairs circular and stating that there were no pending cases against the company in question.
4. The respondents argued that once information is made available in the public domain for a fee, it is not considered to be under the control of the public authority as per Section 2(j) of the RTI Act, and therefore, access to such information falls outside the purview of the Act.
5. The judgment emphasized that the RTI Act obliges public authorities to disseminate information voluntarily to minimize the need for using the Act to obtain information, and public authorities have the right to determine the price for accessing voluntarily disclosed information.
6. It was held that the pricing of access to information by the public authority, different from the rates prescribed under the RTI Act, does not amount to inconsistency and is within the authority's discretion. The appeal was rejected, affirming the decision of the CPIO and the AA to require payment for accessing the requested information.
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2007 (4) TMI 744
Issues Involved:
1. Quashing of proceedings u/s 138 and 141 of the Negotiable Instruments Act (NI Act) against the petitioners.
2. Specific allegations required to hold directors vicariously liable.
Summary:
Issue 1: Quashing of proceedings u/s 138 and 141 of the NI Act against the petitioners
The petitioners, who are directors of the company, sought to quash the proceedings initiated against them for the offence u/s 138 and 141 of the NI Act. The learned Counsel for the petitioners argued that the complaint lacked specific allegations regarding their involvement in the conduct of the company's business. It was contended that the complaint only contained vague and general allegations, which are insufficient to hold the petitioners liable.
Issue 2: Specific allegations required to hold directors vicariously liable
The learned Counsel for the respondent argued that the complaint contained sufficient allegations against the petitioners, stating they were in charge and responsible for the conduct of the company's business. The respondent relied on the judgment of the Supreme Court in S.M.S. Pharmaceuticals Ltd. v. Neeta Bhalla and Anr., which mandates specific averments in the complaint to hold directors liable.
The Court examined the complaint and found that it only contained a general allegation that A3 to A9 were involved and in charge of the day-to-day business of the company. There were no specific allegations regarding the petitioners' roles or their knowledge of the offence. The Court reiterated the principle that a person cannot be held vicariously liable for the offence committed by a company in the absence of specific and definite allegations.
The Court referred to several Supreme Court judgments, including Saroj Kumar Poddar v. State (N.C.T. of Delhi) and N.K. Wahi v. Shekhar Singh and Ors., which emphasized the need for clear and unambiguous allegations to hold directors liable. The Court concluded that the complaint did not meet the requirements to implicate the petitioners and other similarly placed directors.
Conclusion:
The Court quashed the proceedings in C.C. No. 3022 of 2000 against the petitioners and other directors, A3, A9, and A10, who were similarly placed. The Criminal Original Petitions were allowed, and the connected miscellaneous petitions were closed. The Court directed the IX Metropolitan Magistrate, Saidapet, Chennai, to expedite the trial against the remaining accused within five months.
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2007 (4) TMI 743
Issues involved: Interpretation of circular letter dated 21.01.1993 regarding promotion procedure for government servants with pending disciplinary/court proceedings.
Summary:
In this case, the Supreme Court considered the interpretation of a circular letter dated 21.01.1993 in relation to the promotion of a government servant with pending disciplinary proceedings. The respondent, who was recruited to the Indian Railway Traffic Services, was eligible for promotion to the Senior Administrative Grade. However, due to a vigilance case pending against him, a sealed cover procedure was adopted by the Departmental Promotion Committee (DPC) as per the circular guidelines.
The key contention was whether the respondent, who had a chargesheet issued against him after his junior was promoted, should have been promoted during the period when no disciplinary action was pending against him. The appellant argued that the circular was misinterpreted, emphasizing the need for a proper procedure before withholding promotion based on pending charges. On the other hand, the respondent's counsel argued that the circular's provisions should be read in conjunction to ensure fair consideration for promotion.
The Court held that while promotion is not a fundamental right, the right to be considered for promotion is fundamental and must be done in accordance with applicable rules. The circular's sealed cover procedure should only be applied when specific conditions, such as the issuance of a chargesheet, are met. In this case, since the chargesheet was issued after the DPC's recommendations, there was no bar to promoting the respondent earlier.
The Court distinguished previous cases cited by both parties, emphasizing the specific circumstances required for the sealed cover procedure to be invoked. Ultimately, the Court found no fault in the lower courts' judgments and dismissed the appeal with costs.
This judgment clarifies the proper application of circular guidelines in cases of pending disciplinary proceedings for government servants being considered for promotion, ensuring a fair and lawful promotion process.
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2007 (4) TMI 742
Issues involved:
1. Service of notice to the appellant in an arbitration case.
2. Proceedings conducted by the Arbitrator in the absence of the appellant.
3. Applicability of the new Act in the case.
4. Legal obligations of the Arbitrator in case of a party's absence.
5. Setting aside an ex-parte order against the appellant.
Issue 1: Service of notice to the appellant in an arbitration case:
The Trial Court initiated proceedings on 7.1.1993, and the Arbitrator sent a notice through registered AD on 19.5.1993, which was correctly addressed. Despite multiple visits by the postman, the appellant was not available. A second notice was sent on 10.6.1993, with similar unsuccessful attempts to serve the appellant. Eventually, the appellant was served through a publication in a newspaper on July 23, 1993, as he did not appear despite prior notices.
Issue 2: Proceedings conducted by the Arbitrator in the absence of the appellant:
The appellant did not appear before the Arbitrator despite being served with notices. The respondent argued that the appellant intentionally avoided attending the proceedings. The Arbitrator proceeded ex-parte against the appellant due to his non-appearance, leading to the case being decided against him.
Issue 3: Applicability of the new Act in the case:
The respondent contended that the new Act did not apply to the case and cited a previous judgment to support this argument. The court noted that the case fell under the old Act, emphasizing the differences between the old Act and the new Act regarding procedural requirements.
Issue 4: Legal obligations of the Arbitrator in case of a party's absence:
The court referred to a previous judgment and highlighted that under the old Act, an arbitrator should not proceed ex-parte against a party without giving another notice specifying the intention to proceed ex-parte. The court noted the departure from the Civil Procedure Code in the arbitration proceedings and stressed the importance of providing the defaulting party with an opportunity to be heard.
Issue 5: Setting aside an ex-parte order against the appellant:
After considering the arguments from both parties, the court found merit in the appellant's argument regarding the lack of personal service. The court set aside the ex-parte order against the appellant, subject to him furnishing a bank guarantee. The appellant was directed to appear before the Arbitrator and provide the bank guarantee within a month. The Arbitrator was instructed to dispose of the case within one month after receiving the file, without granting any further opportunities or notices to the appellant.
In conclusion, the court allowed the appeal, setting aside the ex-parte order against the appellant and providing specific directions for further proceedings in the arbitration case.
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2007 (4) TMI 741
Issues Involved:
1. Jurisdiction of the Delhi Court to entertain the suit.
2. Applicability of Section 16 and Section 20 of the Code of Civil Procedure (CPC).
3. Validity of the oral Will and its impact on the suit.
Summary:
Jurisdiction of the Delhi Court to entertain the suit:
The plaintiff filed a suit in the High Court of Delhi seeking various reliefs including a declaration that an oral Will dated 1.1.1995 was never made, partition of properties situated in Village Pataudi, Gurgaon, and other related reliefs. The defendants objected to the jurisdiction of the Delhi Court, arguing that the properties in question were located in Gurgaon, Haryana, outside the jurisdiction of the Delhi Court. The trial judge concluded that the reliefs claimed fell within the purview of Section 16(b) and (d) of the Code of Civil Procedure (CPC), and hence, the Delhi Court had no jurisdiction. The plaint was returned for presentation to the proper court.
Applicability of Section 16 and Section 20 of the Code of Civil Procedure (CPC):
The plaintiff contended that the first declaration regarding the alleged oral Will wholly arose within the jurisdiction of the Delhi Court and thus, the Delhi Court had jurisdiction u/s 20 of the CPC. However, the trial judge and the Division Bench held that Section 16(b) and (d) of the CPC applied, and Section 20 could not be resorted to since Section 16 had application. The Division Bench reiterated that the suit was essentially for partition and related declarations concerning properties situated outside the jurisdiction of the Delhi Court. The Supreme Court agreed with this understanding, stating that the suit was one relating to immovable property situated outside the jurisdiction of the Delhi Court and thus, the plaint had been presented in a court having no jurisdiction.
Validity of the oral Will and its impact on the suit:
The plaintiff sought a declaration that the oral Will allegedly made by the deceased mother was never made. The Supreme Court observed that the need for such a negative declaration was superfluous and unnecessary. The plaintiff could sue for partition and other reliefs without such a declaration. The burden would be on the defendants to establish the making and validity of the oral Will if propounded. The Court found that the suit was essentially for partition and related reliefs concerning properties outside the jurisdiction of the Delhi Court, and thus, the trial judge and Division Bench were correct in their conclusions.
Conclusion:
The Supreme Court affirmed the order returning the plaint to the plaintiff for being presented to the proper court and dismissed the appeal, making no order as to costs.
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2007 (4) TMI 740
Issues involved: Application for waiver of pre-deposit of duty, benefit of Notification No.63/95-CE denied, clarification on goods supplied to Ministry of Defence.
Summary:
The Appellate Tribunal CESTAT, New Delhi, heard an application for waiver of pre-deposit of duty amounting to Rs. 22.49 lakhs, where the applicant had already deposited Rs. 10 lakhs. The issue revolved around the denial of the benefit of Notification No.63/95-CE, which provides exemption for goods manufactured by M/s. Bharat Earth Movers Ltd. and supplied to the Ministry of Defence. The applicant contended that they supplied goods to BEML, which were further used in the manufacture of goods supplied to the Ministry of Defence, supported by invoices and certificates. The Tribunal found the evidence presented sufficient to waive the remaining amount of duty and penalties. However, as certain evidence was not before the lower authorities, the impugned order was set aside, and the matter was remanded for fresh decision after affording an opportunity of hearing to the appellant. The appeal was disposed of by way of remand.
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2007 (4) TMI 739
Issues Involved:
1. Scope of the reference to arbitration.
2. Consideration of the letter dated 15-7-1996.
3. Finding on the shortage of 1350 M.T. versus 350 M.T.
Analysis:
1. Scope of the Reference to Arbitration
The appellants contended that the arbitrator's award was beyond the scope of the reference to arbitration, particularly concerning claims arising from the second shipment. The court noted that the appellants did not raise any objection regarding the scope of dispute for arbitration before the arbitrator. The arbitrator framed issues based on the pleadings, including the second shipment, and the appellants did not object to this. The court emphasized that the scope of arbitration could extend beyond the initial reference by consent, either expressly or impliedly, through pleadings. Section 7(4) of the Arbitration and Conciliation Act, 1996, supports this by allowing arbitration agreements to be in writing through various means, including statements of claim and defense. The court concluded that the appellants had waived any objection to the inclusion of the second shipment by not raising it timely before the arbitrator.
2. Consideration of the Letter Dated 15-7-1996
The appellants argued that the arbitrator failed to consider the letter dated 15-7-1996, which they claimed would have influenced the conclusions. The court found that the letter, written after the agreement was finalized and acted upon, did not indicate any modification of the agreed terms. The letter merely expressed doubts about achieving the agreed pumping rate but did not alter the terms of the Memorandum of Understanding (MoU) finalized on 30-5-1996. The court held that the letter did not impact the agreement's terms and thus did not affect the arbitrator's conclusions.
3. Finding on the Shortage of 1350 M.T. versus 350 M.T.
The appellants contended that the shortage in loading was only 350 M.T. instead of 1350 M.T. as found by the arbitrator. They referred to a shipper's communication dated 1-8-1996, indicating that the vessel was to receive 19,000 M.T. of molasses, but only 18,619.589 M.T. was shipped. The court noted that the agreed quantity to be loaded should be ascertained from the charter party document, which was not referred to by the appellants. The letter dated 1-8-1996 could not replace the primary evidence provided by the charter party document. Therefore, the court found no fault with the arbitrator's finding on the shortage.
Conclusion
The court dismissed the appeal, finding no merit in the grounds of challenge raised by the appellants. The arbitrator had acted within the scope of the reference, the letter dated 15-7-1996 did not alter the agreed terms, and the finding on the shortage was supported by the evidence. The appeal was dismissed with no order as to costs.
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2007 (4) TMI 738
Claimed title on the basis of Adverse Possession - two different sale deeds - appellants herein purchased 2 acre 15 guntas and 3 acre guntas of land respectively, out of the said plot - Despite the fact that Nanjapa purchased a portion of the said plot, the appellants allegedly took over possession of the entire 5 acre 23 guntas of land after the aforementioned purchases - However, when allegedly their possession was sought to be disturbed by the respondent in the year 1988 - HELD THAT:- It is to be borne in mind that the respondent had already purchased 1 acre 21 guntas out of the 5 acres 25 guntas under a duly registered deed dated 1.9.1933. Appellant bought the entire chunk of 5 acres 23 guntas subsequent to the respondent's transaction. The validity of such sale is not the question in the instant case but the transaction relating to 1 acre 23 Guntas remains an important surrounding circumstance to assess the nature of appellant's possession. The question is whether it is a case of mistaken possession ignoramus of the previous sale or adverse possession having the mental element in the requisite degree to dispossess. Also much depends on the answer to the query regarding the starting point of adverse possession: when can the possession be considered to have become adverse? In the facts and circumstances of this case, the possession of appellant was effected through the sale deeds, dated 11.04.1934 and 5.07.1936. Therefore, the alleged fact of adverse possession bears a pronounced backdrop of 1933 sale deed passing 1 acre 21 Guntas to the respondent. .
As has already been mentioned, adverse possession is a right which comes into play not just because someone loses his right to reclaim the property out of continuous and willful neglect but also on account of possessor's positive intent to dispossess. Therefore it is important to take into account before stripping somebody of his lawful title, whether there is an adverse possessor worthy and exhibiting more urgent and genuine desire to dispossess and step into the shoes of the paper-owner of the property. This test forms the basis of decision in the instant case.
The argument for a more intrusive inquiry for adverse possession must not be taken to be against the law of limitations. Limitation statutes as statutes of repose have utility and convenience as their purpose. Nevertheless, there has been change on this front as well which have been noticed by us hereto before.
Thus, there is no merit in this appeal which is dismissed accordingly with costs.
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2007 (4) TMI 737
Issues Involved:
1. Whether the petitioner was liable u/s 138/141 of the N.I. Act despite resigning from the directorship before the issuance of the cheques.
2. Whether the absence of an averment in the complaint regarding the petitioner's responsibility for the day-to-day business of the company affects the maintainability of the case.
Summary:
Issue 1: Liability u/s 138/141 of the N.I. Act Post-Resignation
The petitioner sought quashing of the proceeding in Case No. C/7143 of 2003 u/s 482 of the CrPC, arguing that he had resigned from the directorship of the accused company before the issuance of the cheques. The cheques in question were issued on 26/5/2003, while the petitioner resigned on 22/5/2003, as evidenced by Form No. 32 submitted to the Registrar of Companies. The court found the certified copy of Form No. 32 admissible and reliable, establishing that the petitioner was not a director at the relevant time. Consequently, the court held that the petitioner could not be held responsible for the dishonourment of the cheques and quashed the proceedings against him, citing that further continuation would be an abuse of the process of the Court.
Issue 2: Absence of Averment in the Complaint
The petitioner also argued that the complaint lacked an averment that he was responsible for the day-to-day business of the company. However, since the court had already concluded that the petitioner was not a director at the relevant time, it deemed it unnecessary to address this argument. The point was treated as not decided by the court.
Conclusion:
The revisional application was allowed, and the criminal proceeding against the petitioner was quashed. The petitioner was discharged immediately.
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2007 (4) TMI 736
Issues Involved:
1. Interpretation of Press Note No.12 dated 31.8.1998 regarding de-licensing of the sugar industry.
2. Validity of Industrial Entrepreneur Memorandums (IEMs) filed by competing companies.
3. Application and retrospective effect of the Sugarcane (Control) (Amendment) Order, 2006.
4. Grant of milling permission to specific projects amidst pending litigations.
Detailed Analysis:
1. Interpretation of Press Note No.12 dated 31.8.1998:
The primary issue was the interpretation of Press Note No.12, which mandated a minimum distance of 15 KMs between an existing sugar mill and a new one to avoid unhealthy competition. The judgment clarified that the Press Note applied only to cases where a new mill was proposed within 15 KMs of an existing mill. It was held that in the absence of an existing mill, the Press Note had no application, thus dismissing the writ petition filed by Ojas and allowing the one filed by Oudh.
2. Validity of Industrial Entrepreneur Memorandums (IEMs):
The court examined the validity of IEMs filed by Ojas and Oudh. Ojas filed its IEM first and claimed to have taken effective steps towards setting up the mill. However, Oudh's subsequent IEM, filed within 7.2 KMs of Ojas's proposed site, led to a dispute. The court held that the first IEM holder taking effective steps within a reasonable time should be given priority, and subsequent IEMs within 15 KMs should be kept in abeyance. The High Court's decision to disapprove Oudh's IEM was set aside, reinforcing the need for effective steps by the first IEM holder.
3. Application and Retrospective Effect of the Sugarcane (Control) (Amendment) Order, 2006:
The judgment addressed whether the Sugarcane (Control) (Amendment) Order, 2006, which introduced Clauses 6A to 6E, applied retrospectively. The court held that the Order was retrospective, applying to all pending cases, including those where IEMs were in dispute. The Order clarified the effective steps required for implementing IEMs, such as land purchase, machinery orders, and financial arrangements. The court emphasized that the concept of "Distance" was crucial for economic reasons, ensuring adequate supply of sugarcane to mills.
4. Grant of Milling Permission to Specific Projects:
The court considered the application by Balrampur for milling permission for its Kumbhi project, which was complete and had substantial investment. Despite pending litigation, the court granted milling permission to the Kumbhi project to avoid prejudice to cane growers and shareholders, while the Guleria project would be governed by the principles laid down in the judgment. The court emphasized that the 2006 Order aimed to prioritize the first IEM holder taking effective steps, without banning new units.
Conclusion:
The Supreme Court upheld the retrospective application of the Sugarcane (Control) (Amendment) Order, 2006, and clarified that the first IEM holder taking effective steps would have priority over subsequent IEMs within 15 KMs. The court granted milling permission to Balrampur's Kumbhi project, ensuring the principles laid down would guide the resolution of other pending cases. All civil appeals, transfer petitions, and interlocutory applications were disposed of with no order as to costs.
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2007 (4) TMI 735
Death of the injured - commission of an offence u/s 307/324 IPC - converted to one u/s 302 IPC - Application filed for summoning the appellant u/s 319 of the CrPC - witness's chief examination is only done - application u/s 319 CrPC dismissed at this stage - HELD THAT:- The Trial Judge, as noticed by us, in terms of Section 319 of the Code of Criminal Procedure was required to arrive at his satisfaction. If he thought that the matter should receive his due consideration only after the cross-examination of the witnesses is over, no exception thereto could be taken far less at the instance of a witness and when the State was not aggrieved by the same.
It is evident that before a court exercises its discretionary jurisdiction in terms of Section 319 of the CrPC, it must arrive at the satisfaction that there exists a possibility that the accused so summoned is in all likelihood would be convicted. Such satisfaction can be arrived at inter alia upon completion of the cross-examination of the said witness. For the said purpose, the court concerned may also like to consider other evidence. We are, therefore, of the view that the High Court has committed an error in passing the impugned judgment. It is accordingly set aside.
The appeal is allowed.
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2007 (4) TMI 734
Application seeking amendment under Order VI Rule 17 - Withdrawing admission made in written statement - Suit for partition and separate possession of the suit properties - Whether the High Court was justified in rejecting the application for amendment of the written statement? - HELD THAT:- Considering the facts, it was not a case of withdrawal of the admission by the appellants by making the application for the amendment of the written statement but in fact such admission was kept intact and only a proviso has been added. This, in our view, is permissible in law and the question of withdrawing the admission made in para 8 in its entirety in the facts as noted herein above, therefore, cannot arise at all.
Since we have already held that in the case of amendment of a written statement, the defendant is entitled to take new defence and also to plead inconsistent stand and in view of our discussions made herein above that by making the application for amendment of the written statement, admission was not at all withdrawn by the appellants nor a totally inconsistent plea was taken by the appellants in their application for amendment of the written statement, the High Court had failed to appreciate that by the proposed amendment, the appellants were not withdrawing their admission in respect of the half share in the ancestral property rather they only added that the plaintiff and defendant Nos. 3 to 8 could be entitled to such share if they proved to be the legitimate children of Appasao (since deceased) who was entitled to half share in the property of late Veersangayya. That apart, it appears from the record that the written statement filed by the appellants was before the death of defendant No. 1 (first wife of Appasao).
After the death of defendant No. 1, when plaintiff and defendant Nos. 2 to 8 claimed themselves as heirs and legal representatives of defendant No. 1, the appellants sought amendment of the written statement challenging the legitimacy of plaintiff and defendant Nos. 2 to 8. In view of the discussions made herein above, we do not think that it was impermissible in law for the appellants to seek amendment of the written statement in the manner it was sought for.
Therefore, it was neither a case of withdrawal of admission made in the written statement nor a case of washing out admission made by the appellant in the written statement. As noted herein earlier, by such amendment the appellant had kept the admissions intact and only added certain additional facts which need to be proved by the plaintiff and defendant No. 2 to 8 to get shares in the suit properties alleged to have been admitted by the appellants in their written statement.
Accordingly, we are of the view that the appellants are only raising an issue regarding the legitimacy of plaintiff and defendant Nos. 3 to 7 to inherit the suit properties as heirs and legal representatives of the deceased Appasao. Therefore, the High Court was not justified in reversing the order of the trial court and rejecting the application for amendment of the written statement.
Thus, the appeal is allowed and the order of the High Court rejecting the prayer for amendment of the written statement is set aside. The application for amendment of the written statement thus stands allowed.
There will be no order as to costs.
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2007 (4) TMI 733
Issues involved: Whether the appellant as a merchant banker has been guilty of lack of "due diligence" u/s 15T of the Securities and Exchange Board of India Act, 1992.
Summary:
Issue 1: Lack of Due Diligence by the Appellant
The case involved a public issue by M/s Baroda Agro Industries Ltd. in 1994, where the prospectus contained misleading information regarding the lock-in period of shares held by promoters. The shares were actually allotted to non-promoters in 1992 on a private placement basis. The shares were not stamped as non-transferable for the mandatory five-year lock-in period. The appellant, as a merchant banker, certified the misleading statement as true and correct, showing a lack of due diligence. This lack of diligence led to innocent investors purchasing shares that could not be transferred, resulting in financial loss.
Issue 2: Penalty Imposed on the Appellant
The Securities and Exchange Board of India debarred the appellant from dealing in securities or engaging in capital market activities for three years. The appellant argued for a lesser penalty, citing lack of due diligence as the only fault. However, the tribunal found that the lack of due diligence had serious consequences for investors who suffered financial losses. Due diligence is a primary responsibility of a merchant banker, and the appellant's failure warranted a penalty. The tribunal reduced the debarment period to six months, considering no collusion with the company to suppress facts.
In conclusion, the appeal was disposed of with a modified order reducing the debarment period to six months, emphasizing the importance of due diligence in protecting investors and maintaining market integrity.
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2007 (4) TMI 732
Issues involved:
Challenge to judgment u/s 100 of the Code of Civil Procedure, 1908 by legal representatives of original plaintiff.
Judgment details:
Issue 1:
Plaintiff's claim of ownership and possession of suit properties against defendants' counterclaim.
The plaintiff alleged that the defendants fraudulently obtained the suit properties, cut trees, tapped toddy, and cultivated crops without right. Trial court ruled in favor of plaintiff for possession and past mense profits. First appellate court noted non-impleadment of certain defendants but upheld plaintiff's ownership claim.
Issue 2:
Effect of withdrawal of earlier suit without liberty to file fresh suit.
The High Court invoked Order XXIII Rule 1(4) to preclude defendants from raising defense on validity of conveyance deed. Appellants argued against applicability of the rule, citing legal precedents. The court analyzed various judgments to conclude that withdrawal without liberty does not constitute a decree and does not bar defendants from raising defense in subsequent litigation.
This judgment clarifies the legal implications of withdrawal of a suit without permission to file a fresh suit, emphasizing that such withdrawal does not preclude parties from raising relevant defenses in subsequent litigation. The court upheld the plaintiff's ownership claim and possession rights over the suit properties while addressing the procedural aspects of withdrawal without liberty to file a fresh suit.
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2007 (4) TMI 731
Issues Involved:
1. Forum Selection Agreement
2. Situs of the Respondent's Head Office
3. Accrual of Cause of Action
Detailed Analysis:
Issue 1: Forum Selection Agreement
The primary question was whether the writ petition could be governed by the forum selection agreement between the parties. The court examined the forum selection clause in the tender document, which stated: "for any legal dispute, if arises, the jurisdiction for settlement will be the Civil Court, Murigaon, Assam." The court concluded that this clause applies only to disputes in the private law field and not to writ petitions seeking enforcement of constitutional rights. Thus, the forum selection clause does not bar the writ petition in this court. The court emphasized that constitutional provisions under Article 226 cannot be contracted out by private agreements, and the forum selection clause was deemed vague and inapplicable to the present writ petition.
Issue 2: Situs of the Respondent's Head Office
The court considered whether the location of the respondent's head office within its jurisdiction was a relevant factor for invoking writ jurisdiction. Article 226(2) of the Constitution allows a High Court to exercise jurisdiction if the cause of action arises wholly or in part within its territory or if the seat of the government or authority is within its territory. The court held that the situs of the respondent's head office is indeed a relevant factor for invoking jurisdiction. The court referenced the Division Bench judgment in Pottery Mazdoor Panchayat, which supported this view, and rejected the learned Single Judge's reliance on a different interpretation.
Issue 3: Accrual of Cause of Action
The court examined whether any part of the cause of action had arisen within its territorial jurisdiction. The petitioners claimed that the agreement was executed and the work order was accepted at their office in Kolkata. However, the respondents contended that all relevant actions, including the execution of the contract and the receipt of the work order, occurred in Assam. The court found that the petitioners failed to provide sufficient evidence to prove that the work order was received and accepted in Kolkata. Additionally, the court noted that payments were to be made through a bank in Assam, and the principle of "debtor must seek creditor" was not applicable here due to specific contractual terms. Consequently, the court agreed with the learned Single Judge that no part of the cause of action had arisen within its jurisdiction.
Conclusion:
The court set aside the learned Single Judge's judgment regarding the forum selection clause, holding that it does not bar the writ petition. However, it upheld the finding that no part of the cause of action arose within the territorial jurisdiction of the Calcutta High Court. The court remanded the matter to the learned Single Judge to be heard on merit. The judgment underscores the distinction between private contractual disputes and constitutional writ petitions, emphasizing that constitutional provisions cannot be overridden by private agreements.
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2007 (4) TMI 730
Issues Involved:
1. Delay in filing the writ petition.
2. Validity of treating previous judgments as precedents.
3. Financial implications of the court's orders on the State.
Summary:
1. Delay in filing the writ petition:
The Supreme Court addressed the issue of delay in filing the writ petition by the respondents. The panel for appointment of primary teachers was prepared in 1980, and the respondents approached the court in 1989 after the decision in Dibakar Pal's case. The Court emphasized that "delay is very significant in matters of granting relief and Courts cannot come to the rescue of the persons who are not vigilant of their rights." The Court cited the case of Chairman, U.P. Jal Nigam and Anr. Vs. Jaswant Singh and Anr. [JT 2006 (10) 500], stating that "those who sit on the fence and wait for a favourable order and thereafter wake up to take up the matter, are not entitled to any relief." Consequently, the view taken by the High Court condoning the delay of nine years was not upheld.
2. Validity of treating previous judgments as precedents:
The Supreme Court scrutinized the reliance on previous judgments, particularly the cases of Sirazul Haque Mallick and Dibakar Pal. The Court noted that the judgment in Sirazul Haque Mallick's case was based on concession and explicitly mentioned that it "shall not be treated as a precedent." Despite this, subsequent cases, including Dibakar Pal's and the present case, treated it as a binding precedent. The Court clarified that "any order passed on concession does not lay down the law and it cannot be followed as a precedent." The Court cited Mittal Engineering Works (P) Ltd. v. Collector of Central Excise, Meerut [(1997) 1 SCC 203] and Arnit Das v. State of Bihar [(2000) 5 SCC 488], reinforcing that a decision not consciously determining a point of law does not form part of ratio decidendi and is not binding. Therefore, the judgments in Sirazul Haque Mallick and Dibakar Pal could not be upheld as binding precedents.
3. Financial implications of the court's orders on the State:
The Supreme Court expressed concern over the financial burden imposed on the State by the orders of the lower courts. The Court observed that "the Court should keep restrain before passing order saddling State Government with financial burden." The panel of 1980 was kept alive up to 2004, which was deemed inappropriate as it disregarded the aspirations of many more candidates waiting in queue. The Court emphasized that such actions could not be countenanced.
Conclusion:
The Supreme Court set aside the impugned order of the Division Bench dated 11.6.2004, allowing the appeal filed by the appellants. The Court concluded that the reliance on the judgments of Sirazul Haque Mallick and Dibakar Pal was misplaced, as the former was based on concession and explicitly stated not to be treated as a precedent. There were no orders as to costs.
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2007 (4) TMI 729
Issues Involved:
1. Authority of Sub-Divisional Officer to allot Government land.
2. Validity of the lease and subsequent transfer of land.
3. Jurisdiction of the High Court under Article 226 of the Constitution of India.
4. Principles of natural justice.
Summary:
1. Authority of Sub-Divisional Officer to allot Government land:
The Sub-Divisional Officer, Kotdwar, on 31-3-1993, approved the allotment of land to Mahanth Govind Das and executed a lease deed for thirty years. The District Magistrate later found that the Sub-Divisional Officer had no authority to allot the land, as the power to grant Government land for residential purposes vested in the District Magistrate. The High Court confirmed that the Sub-Divisional Officer lacked jurisdiction to grant/allot the Government land, and the power vested only with the District Collector.
2. Validity of the lease and subsequent transfer of land:
The appellants purchased the constructions raised by Mahanth Govind Das under a registered sale deed dated 26-4-1995. The Deputy Collector initially directed the transfer of the land to the appellants. However, the District Magistrate/Collector quashed the order of transfer, holding that the Sub-Divisional Officer abused his authority and that the allotment and lease did not confer any right, title, or interest in the land. The High Court held that the appellants did not purchase the land but only the debris of constructions and that the Sub-Divisional Officer's order was void and without jurisdiction.
3. Jurisdiction of the High Court under Article 226 of the Constitution of India:
The High Court found that the appellants failed to establish that they lawfully secured the allotment of land. It emphasized that a person invoking the extraordinary jurisdiction of the High Court must come with clean hands and make a full and complete disclosure of facts. The High Court refused to resurrect the order of the Sub-Divisional Officer, which was unenforceable in law.
4. Principles of natural justice:
The appellants contended that the order of the District Collector was in violation of the principles of natural justice as the show-cause notice did not mention the withdrawal of the Sub-Divisional Officer's power. However, the Supreme Court noted that the appellants did not raise this issue in their writ petition and failed to plead and establish the authority of the Sub-Divisional Officer. The Court held that even if there was a technical violation of natural justice, interference would result in the resurrection of an illegal order.
Conclusion:
The Supreme Court dismissed the appeals, affirming that the Sub-Divisional Officer had no authority to allot the land and that the appellants failed to establish their lawful entitlement to the land. The Court emphasized that interference with the impugned order would restore orders not in accordance with law.
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2007 (4) TMI 728
Issues involved: Assessment and penalties u/s 39(1) of the Karnataka Value Added Tax Act, 2003.
The High Court of Karnataka heard a writ petition filed by an assessee-dealer challenging assessment orders and penalties imposed u/s 39(1) of the Act. The petitioner claimed that the product should be taxed at 4% under a specific entry, but the assessing authority assessed it at 12.5% under a different provision. The petitioner argued that the product should be treated as an 'insecticide' under a specific entry, and not as a general commodity. Additionally, the petitioner mentioned that other assesses had obtained an advance ruling for similar products to be taxed at 4%.
The court rejected the petitioner's contentions, stating that the assessing authority did not rely on any circular for the assessment orders. The court emphasized that the authority must apply its own reasoning and not rely on external sources. Regarding the advance ruling obtained by another assessee, the court stated that the petitioner had not filed for such a ruling. The court advised the petitioner to either rely on the ruling before the appellate authority or seek an advance ruling from the competent authority. The court highlighted that the clarification by the commissioner and the advance ruling obtained by another assessee do not directly impact the assessment of the petitioner.
The Additional Government Advocate submitted that the petitioner should follow the statutory remedy and not bypass it. The court found no reason to interfere with the case and agreed with the government advocate's submission. Consequently, the writ petition was rejected, with the petitioner being granted the liberty to explore other available remedies in accordance with the law.
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2007 (4) TMI 727
The Supreme Court of India dismissed the special leave petition in the case. The citation is 2007 (4) TMI 727 - SC. The case was referenced by the Gujarat High Court in 2006 (2) TMI 92. The judges were Mr. Ashok Bhan and Mr. V.S. Sirpurkar. The legal representatives for the petitioner(s) and respondent(s) are listed.
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