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• 2011 (3) TMI 1763
  
  Issues Involved:
  1. Legitimacy of children born from a void marriage.
  2. Entitlement of illegitimate children to ancestral and self-acquired property.
  3. Interpretation of Section 16(3) of the Hindu Marriage Act, 1955.
  
  Summary:
  
  Issue 1: Legitimacy of children born from a void marriage

  The Plaintiffs (first wife and her two children) filed a suit for partition and separate possession against the Defendants for their 1/4th share each with respect to ancestral property. The Plaintiffs contended that the first Defendant's second marriage was void, and thus, the children from this marriage were not coparceners. The Trial Court held that the second marriage was void and the third Plaintiff was the legally wedded wife, entitling her to claim partition. The Appellate Court affirmed these findings but held that children from a void marriage were to be treated at par with coparceners and entitled to joint family properties.

  Issue 2: Entitlement of illegitimate children to ancestral and self-acquired property

  The High Court of Karnataka held that illegitimate children only had rights to the property of their parents, not coparcenary property by birth. The Supreme Court examined Section 16(3) of the Hindu Marriage Act, which states that children from void marriages can only claim rights to their parents' property. The Court noted that the legislature used the term "property" broadly, without specifying self-acquired or ancestral property. Historical cases and amendments were discussed, showing that illegitimate children had limited rights compared to legitimate children but could claim their father's property after his death.

  Issue 3: Interpretation of Section 16(3) of the Hindu Marriage Act, 1955

  The Supreme Court analyzed the interpretation of Section 16(3) in previous cases like Jinia Keotin, Neelamma, and Bharatha Matha, which limited illegitimate children's rights to self-acquired property. The Court disagreed with these interpretations, stating that the amended Section 16(3) intended to remove the stigma of illegitimacy and should be interpreted to include both self-acquired and ancestral property of the parents. The Court emphasized that such children are legitimate and should not be discriminated against, aligning with constitutional values of equality and dignity. The Court concluded that the matter should be reconsidered by a larger Bench.

  Conclusion:

  The Supreme Court held that illegitimate children are entitled to a share in their parents' property, whether self-acquired or ancestral, but not in the property of any other relation. The interpretation of Section 16(3) in previous judgments was reconsidered, and the matter was referred to a larger Bench for further examination.

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• 2011 (3) TMI 1762
  
  ... ...
  ... ... ..... ition is dismissed on the ground of delay as well as on merits.

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• 2011 (3) TMI 1761
  
  Issues Involved:
  1. Challenge to Ext.P2 No Objection Certificate (NOC) issued by the District Collector.
  2. Challenge to Ext.P4 Consent issued by the Kerala State Pollution Control Board.
  3. Request for assessment of environmental damage by a competent agency.
  
  Summary:
  
  1. Challenge to Ext.P2 No Objection Certificate (NOC):
  The petitioner sought to quash Ext.P2 NOC issued by the District Collector, Thrissur, and Ext.P4 Consent issued by the Kerala State Pollution Control Board to the 5th respondent for establishing a quarry. The 5th respondent's initial application for an NOC was rejected, leading to an appeal before the Land Revenue Commissioner, who allowed the appeal and directed the issuance of the NOC subject to safety measures proposed by the Center for Earth Science and Studies (CESS). The District Collector then issued Ext.P2 NOC and constituted a Local Monitoring Committee. Previous challenges to the NOC in W.P(C) Nos. 27403 of 2005, 20230 of 2006, and 6623 of 2008 were dismissed by the Court, upholding the grant of the NOC. The Court noted that the petitioner, not being a party to the earlier judgments, could not successfully challenge Ext.P2. The Court reiterated that blasting with low-intensity explosives would not trigger an earthquake, as per the findings in Ext.R5(a) and R5(b) judgments.
  
  2. Challenge to Ext.P4 Consent:
  Ext.P4 is the consent granted by the Kerala State Pollution Control Board to establish a quarry, valid until 30.6.2012. The petitioner did not challenge the consent to operate the quarry issued on 4.7.2009. Given the time elapsed and the established quarry operations, the Court opined that the petitioner could not successfully challenge Ext.P4.
  
  3. Request for Assessment of Environmental Damage:
  The petitioner alleged serious environmental imbalance due to the quarrying operations and requested an assessment by CESS or another competent agency. However, the petitioner failed to provide specific details or cogent material to support the allegations. The Land Revenue Commissioner, in Ext.P1 order, had already addressed the concerns, stating that controlled quarrying would not cause significant environmental impact or trigger earthquakes. The Court found no sufficient grounds to grant the requested relief, emphasizing the need for periodic inspections by the Local Monitoring Committee.
  
  Conclusion:
  The writ petition was dismissed, with the Court directing the Local Monitoring Committee to conduct monthly inspections of the quarry to ensure compliance with the NOC conditions. The District Collector was instructed to ensure the Committee submits periodic reports. No costs were awarded.

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• 2011 (3) TMI 1760
  
  Issues involved:
  The issues involved in this case are the quashing of complaints filed under Section 138 of the Negotiable Instruments Act (N.I. Act) for dishonour of cheques, the interpretation of Section 138 N.I. Act regarding the liability for dishonoured cheques, and the validity of multiple complaints for dishonour of cheques against a single liability.
  
  Summary:
  
  Issue 1: Quashing of complaints under Section 138 N.I. Act
  The petitioner sought the quashing of complaints filed against him under Section 138 of the N.I. Act by respondent No.2 for dishonour of three cheques issued by him as security and assurance for encashment of a cheque worth `70 lakhs. The petitioner contended that the cheques were issued from his personal account only as security and not for the discharge of any existing liability.
  
  Issue 2: Interpretation of Section 138 N.I. Act
  The court examined Section 138 N.I. Act, which imposes criminal liability only if a dishonoured cheque was issued for the discharge of an existing debt or liability. It clarified that a post-dated cheque issued for a future liability would not attract Section 138 N.I. Act. Citing the case of M.S. Narayana Menon @ Mani Vs. State of Kerala & Anr., the court emphasized that cheques issued for security or other purposes do not fall under Section 138 of the Act.
  
  Issue 3: Validity of multiple complaints for dishonour of cheques
  The respondent argued that since the cheque of `70 lakhs was dishonoured, they had the right to present the three cheques issued as security for encashment. The court noted that the three cheques of `25 lakhs each were issued by the petitioner as security from his personal account and were to be presented only in case of the dishonour of the `70 lakhs cheque. Consequently, the court held that Section 138 N.I. Act was not attracted in this case, and the petitions for quashing the complaints were allowed.
  
  In conclusion, the court quashed the summoning orders for the complaints filed against the petitioner under Section 138 N.I. Act, as the cheques in question were issued as security and not for the discharge of an existing liability.

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• 2011 (3) TMI 1759
  
  Issues Involved:
  1. Lack of opportunity to participate in the arbitration hearing.
  2. Arbitrator exceeding the scope of reference.
  
  Issue-wise Detailed Analysis:
  
  1. Lack of Opportunity to Participate in the Arbitration Hearing:
  The appellant contended that they were not given proper notice for the hearing on 24.06.2000, which affected their ability to present their case, thus violating Sec.34(2)(a)(iii) of the Arbitration and Conciliation Act, 1996. The court examined the proceedings and found that the appellant was aware of the hearing dates and had been given multiple opportunities to participate. Despite being present on 20.05.2000, the appellant chose not to stay for the hearing. Notices were sent for subsequent hearings, including the one on 03.06.2000. The court concluded that the appellant's claim of not having a reasonable opportunity to present their case was unfounded. The arbitrator's actions were consistent with the principles of natural justice, and the appellant's consistent non-appearance did not justify setting aside the award.
  
  2. Arbitrator Exceeding the Scope of Reference:
  The appellant argued that the arbitrator adjudicated claims beyond the scope of the Consignment Stockist Agreement dated 12.07.1997, which contained the arbitration clause, and included claims from the Stockist Agreement dated 01.08.1995, which did not have an arbitration clause. The court referred to Sec.16(3) of the Arbitration Act, which requires any plea that the arbitral tribunal is exceeding its authority to be raised promptly. The appellant failed to raise this objection during the arbitration proceedings. The court found that the agreements were interconnected and related to the same transactions and parties. The arbitration clause in the 12.07.1997 agreement covered disputes arising out of or in connection with the agreement, thus justifying the arbitrator's jurisdiction over the interconnected disputes. The court cited relevant case law, including the Supreme Court's decision in Olympus Superstructures Pvt. Ltd. v. Meena Vijay Khetan, to support its conclusion that the arbitrator did not exceed his jurisdiction.
  
  Conclusion:
  The court dismissed the appeal, affirming that the arbitrator provided adequate opportunities for the appellant to present their case and acted within the scope of the arbitration agreement. The appellant's failure to participate and raise timely objections did not warrant setting aside the award. The judgment emphasized the importance of cooperation in arbitration proceedings and upheld the arbitrator's comprehensive jurisdiction over interconnected disputes.

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• 2011 (3) TMI 1758
  
  Issues Involved:
  1. Estimation of unaccounted sales.
  2. Addition based on Gross Profit (GP) versus Net Profit (NP) from unaccounted sales.
  3. Addition on account of unexplained investment under section 69A.
  4. Addition of additional income disclosed by the assessee.
  5. Levy of interest under sections 234B, 234C, and 234D.
  
  Issue-wise Detailed Analysis:
  
  1. Estimation of Unaccounted Sales:
  The primary dispute was the estimation of unaccounted sales for the assessment years (A.Y.) 2005-06 and 2007-08 based on material found for A.Y. 2006-07. The Assessing Officer (AO) estimated unaccounted sales for A.Y. 2005-06 at Rs. 48,00,641/- based on the unaccounted sales percentage (83%) found for A.Y. 2006-07. The CIT(A) upheld this estimation, but the tribunal disagreed, stating that each assessment year is independent, and without specific material for A.Y. 2005-06, such estimation is unjustified. Consequently, the tribunal deleted the addition for A.Y. 2005-06. For A.Y. 2007-08, the AO estimated unaccounted sales at Rs. 51,33,376/- based on the percentage from A.Y. 2006-07, but the tribunal held that only the actual unaccounted sales found from seized documents, Rs. 42,64,419/-, should be considered.
  
  2. Addition Based on Gross Profit (GP) vs. Net Profit (NP) from Unaccounted Sales:
  The AO added the GP from unaccounted sales, but the assessee argued that NP should be considered, citing that indirect expenses should be allowed. The CIT(A) upheld the AO's decision, emphasizing that GP is more stable for comparison. The tribunal acknowledged that if unaccounted expenses are found, they should be added first and then allowed as deductions. The tribunal remanded the issue back to the AO to examine if any unaccounted expenses were already claimed against accounted sales and to allow deductions accordingly.
  
  3. Addition on Account of Unexplained Investment Under Section 69A:
  For A.Y. 2005-06, the AO added Rs. 15,54,288/- as unexplained investment based on estimated unaccounted sales. The tribunal deleted this addition since no unaccounted sales were confirmed for A.Y. 2005-06. For A.Y. 2007-08, the AO added Rs. 67,646/- for excess stock found, which was upheld by the CIT(A) and the tribunal, as the discrepancy could not be reconciled.
  
  4. Addition of Additional Income Disclosed by the Assessee:
  The AO added Rs. 3,50,000/- as the assessee disclosed only Rs. 11.50 lacs out of Rs. 15 lacs offered during the search. The tribunal found merit in the assessee's argument that since the AO already added undisclosed income exceeding the shortfall, no further addition was necessary. The tribunal directed that if the final addition as undisclosed income is more than Rs. 3.50 lacs, no further addition is needed, otherwise, the balance should be added.
  
  5. Levy of Interest Under Sections 234B, 234C, and 234D:
  The levy of interest was acknowledged as consequential by the assessee's representative. The tribunal directed the AO to recompute the interest while giving effect to this order.
  
  Conclusion:
  The appeals were partly allowed, with specific directions for the AO to reassess certain aspects, especially regarding the allowance of unaccounted expenses and the accurate computation of interest. The tribunal emphasized the independence of each assessment year and the necessity of concrete evidence for each period under scrutiny.

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• 2011 (3) TMI 1757
  
  The Supreme Court dismissed civil appeal no. 905 of 2006 after condoning the delay. As a result, appeal no. 4421 of 2008 was rendered infructuous and disposed of accordingly.

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• 2011 (3) TMI 1756
  

  Challenging the legality and validity of the initiation of reassessment proceedings - HELD THAT:- In the case on hand, the assessee has not included the CST paid on the closing stock while making its valuation. Similarly, the assessee has not included the 30% of the Excise Duty. The case of the Department is thus the assessee has claimed excess loss of income in its return which is contrary to section 145-A. At this stage, the Department has placed reliance upon Explanation 2(C) to section 147. Sub clause (iv) to clause(c) of Explanation 2 to section 147 supports the Department's point of view that it is a case of deemed escapement of assessment. It is not necessary for us to dwell upon this point any further. The sufficiency of the reason is beyond the scope of scrutiny at this stage. The sufficiency of the material cannot be gone into but relevancy certainly can be gone into. The reasons recorded by the concerned authority are relevant reasons to form a belief that the income of the petitioner has escaped assessment.

  Therefore, We find no force in the argument of the petitioner that on the basis of the reasons recorded by the AO, the re-assessment proceedings could not have been initiated. There is relevant material to form a belief that the income of the petitioner has escaped income. At this stage, it can be said that there is relevant material on the record to form a reasonable belief that the taxable income of the assessee has escaped assessment, in view of section 145-A.

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• 2011 (3) TMI 1755
  
  Issues Involved:
  1. Validity of the votes polled in the District Court campus at Nagercoil and Padmanabhapuram.
  2. Maintainability of the suit filed by the Tamil Nadu Advocates Association.
  3. Compliance with election rules and procedures.
  4. Allegations of malpractice, rigging, and tampering during the election process.
  5. Possible remedies and actions to address election irregularities.
  
  Issue-Wise Detailed Analysis:
  
  1. Validity of the votes polled in the District Court campus at Nagercoil and Padmanabhapuram:
  The judgment invalidated all votes polled in the District Court campus at Nagercoil and Padmanabhapuram due to severe election malpractices. Reports from Special Observers indicated that the polling officer at Nagercoil marked votes for a particular candidate and volunteers cast votes on behalf of absent voters. Similar irregularities were reported at Padmanabhapuram, where voters were allowed to vote without showing identity cards, and dual voting occurred. The actions were deemed to constitute tampering under Rule 25(2) of the Bar Council of Tamil Nadu Election Rules, leading to the invalidation of all votes from these booths.
  
  2. Maintainability of the suit filed by the Tamil Nadu Advocates Association:
  The court rejected the contention that the Tamil Nadu Advocates Association lacked locus standi to file the suit. The Association, registered under the Tamil Nadu Societies Registration Act, 1975, was found to have the right to ventilate the grievances of its members. The court emphasized that a society of professionals can file a suit for the collective interests of its members, and public interest litigations are not confined to constitutional courts but have their origins in civil procedure rules.
  
  3. Compliance with election rules and procedures:
  The judgment highlighted multiple violations of election rules. Rule 20 mandates that voters mark their preferences in secrecy, which was not followed at Nagercoil and Padmanabhapuram. Additionally, the requirement for voters to produce photo identity cards and have indelible ink marked on their fingers was ignored. The court noted that these violations amounted to tampering with the ballot boxes, justifying the invalidation of the votes under Rule 25(2).
  
  4. Allegations of malpractice, rigging, and tampering during the election process:
  The judgment detailed the extensive malpractices reported by Special Observers, including pre-marked ballot papers, multiple voting by the same individuals, and failure to verify voter identities. The court found these actions to be deliberate and defiant, undermining the democratic process. The involvement of the independent Poll Observer in these malpractices was particularly noted, indicating a severe breach of trust and responsibility.
  
  5. Possible remedies and actions to address election irregularities:
  The court considered two options: countermanding the poll and ordering a re-poll or invalidating the votes. Given the extraordinary nature of the violations and the repeated misconduct by the Nagercoil Bar, the court opted for the latter. The judgment emphasized that the Bar Council of Tamil Nadu Election Rules did not provide for re-polling, and the only available remedy under Rule 25(2) was to invalidate the tampered ballot boxes. The court also noted the lack of specific provisions for re-polling in the rules, unlike the Representation of the People Act, 1951, which governs parliamentary and state legislative elections.
  
  Conclusion:
  The judgment comprehensively addressed the issues of election malpractice and procedural violations, leading to the invalidation of votes from Nagercoil and Padmanabhapuram. It upheld the maintainability of the suit by the Tamil Nadu Advocates Association and emphasized the importance of adhering to election rules to ensure a fair and democratic process. The court's decision to invalidate the votes was based on the severe and deliberate nature of the reported irregularities, with no provision in the rules for ordering a re-poll.

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• 2011 (3) TMI 1754
  
  Issues Involved:
  1. Inclusion of asset withdrawal values in gross receipts.
  2. Utilization and inclusion of depreciation reserve in gross receipts.
  3. Allowance of depreciation claim on motor buses at 40%.
  4. Inclusion of grants received in gross receipts.
  5. Exemption under section 11(1)(a) of the Income Tax Act.
  
  Issue-wise Detailed Analysis:
  
  1. Inclusion of Asset Withdrawal Values in Gross Receipts:
  Assessment Year 2005-06:
  The CIT included Rs. 21.34 crores in the gross receipt, arguing that these amounts represented the gross value of assets withdrawn from the asset schedule, not the actual realization of scrap value, which was Rs. 5.6 crores. The Tribunal noted that both the AO and CIT misunderstood the nature of the entries in the books. The Tribunal explained that the entries for depreciation reserve and asset write-offs do not result in accretion of income. Hence, the Tribunal remitted the issue back to the AO for a detailed examination.
  
  Assessment Year 2006-07:
  Similarly, the CIT included Rs. 60.4 crores in the gross receipt, arguing it represented the gross value of assets withdrawn from the asset schedule, not the actual realization, which was Rs. 3.32 crores. The Tribunal found the CIT's and AO's understanding flawed and remitted the issue back to the AO for a detailed examination.
  
  2. Utilization and Inclusion of Depreciation Reserve in Gross Receipts:
  Assessment Year 2005-06:
  The CIT noted that the actual utilization of depreciation reserve was Rs. 34.92 crores, whereas the AO considered Rs. 21.34 crores. The Tribunal found that the entries for depreciation reserve do not result in accretion of income and remitted the issue back to the AO for a detailed examination.
  
  Assessment Year 2006-07:
  The CIT noted that the actual utilization of depreciation reserve was Rs. 38.49 crores, whereas the AO considered Rs. 9.35 crores. The Tribunal found the CIT's and AO's understanding flawed and remitted the issue back to the AO for a detailed examination.
  
  3. Allowance of Depreciation Claim on Motor Buses at 40%:
  Assessment Year 2005-06:
  The CIT argued that the assessee was not eligible for a higher rate of depreciation as it was not in the business of running buses on hire. The Tribunal, relying on the ruling of the Hon'ble Kerala High Court in CIT v. Balakrishna Transports, held that the assessee is entitled to claim depreciation at 40% on motor buses.
  
  Assessment Year 2006-07:
  The Tribunal applied the same reasoning as in the previous year and held that the assessee is entitled to claim depreciation at 40% on motor buses.
  
  4. Inclusion of Grants Received in Gross Receipts:
  Assessment Year 2006-07:
  The CIT included Rs. 1.64 crores in the gross receipt, arguing that the grants received from CRF and MLA were not fully accounted for in the miscellaneous receipts. The Tribunal remitted the issue back to the AO to ascertain the facts from the books of accounts and decide the issue afresh on merits.
  
  5. Exemption under Section 11(1)(a) of the Income Tax Act:
  Assessment Year 2006-07:
  The CIT argued that the exemption should be calculated on the net income, not the gross receipts. The Tribunal, relying on the decision in ITA No. 589/Bang/2009, held that the AO correctly allowed the exemption based on the net income.
  
  Additional Ground:
  The assessee argued that the amount withdrawn from the depreciation reserve should not be included in the gross income for the purpose of section 11. The Tribunal remitted this issue back to the AO for examination and appropriate action in accordance with the law.
  
  Conclusion:
  The Tribunal partly allowed the appeals for statistical purposes, remitting several issues back to the AO for detailed examination and fresh consideration. The Tribunal emphasized the need for a thorough review of the books of accounts to ensure accurate tax assessment.

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• 2011 (3) TMI 1753
  
  Issues Involved:
  1. Quashing of proceedings u/s 482 Cr.P.C.
  2. Mandatory enquiry u/s 202 Cr.P.C.
  3. Territorial jurisdiction of the Magistrate.
  
  Summary:
  
  Issue 1: Quashing of proceedings u/s 482 Cr.P.C.
  The applicant sought to quash the proceedings in Criminal Case No. 882/SS/10 pending before the Metropolitan Magistrate, Bandra, for the offence u/s 138 of the Negotiable Instruments Act. The complainant, a non-banking financial company, alleged that the accused issued 11 cheques which were dishonored. Despite statutory notice, the accused failed to pay, leading to the complaint. The Magistrate issued process after verifying the complaint and supporting documents.
  
  Issue 2: Mandatory enquiry u/s 202 Cr.P.C.
  The accused contended that the Magistrate failed to conduct a mandatory enquiry u/s 202 Cr.P.C. as the accused resided outside the local jurisdiction. The Court referenced Capt. S.C. Mathur v. Elektronik Lab. and Ors. and Satish @ Rajendra Harbans Tiwari and Ors. v. State of Maharashtra and Anr., which emphasized the necessity of such an enquiry. However, the Court also considered Bansilal S. Kabra v. Global Trade Finance Ltd., which held that the provision is directory, not mandatory. The Court agreed with this view, noting that sufficient material was presented to the Magistrate to justify the issuance of process without further enquiry.
  
  Issue 3: Territorial jurisdiction of the Magistrate
  The accused argued that no part of the transaction occurred in Mumbai, thus the Mumbai Court lacked jurisdiction. The Court examined the agreements and transactions, noting that the original agreement was executed in Mumbai, and funds were disbursed from Mumbai. The Court referenced K. Bhaskaran v. Sankaran Vaidhyan Balan and Anr., which outlined the five components of an offence u/s 138, stating that if any of these acts occur in different localities, any of those local areas can have jurisdiction. The Court found that two components (notice issuance and payment failure) occurred in Mumbai, along with the original contract, thus affirming the jurisdiction of the Mumbai Magistrate.
  
  Conclusion:
  The application to quash the proceedings was rejected. The trial Court was instructed not to be influenced by observations regarding the execution of the agreement dated 26.9.2005, as only a photocopy was produced.

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• 2011 (3) TMI 1752
  
  Issues Involved:
  1. Infringement of the Plaintiff's registered trademark TATA.
  2. Passing off the Defendant's goods as those of the Plaintiff.
  3. Determination of TATA as a well-known trademark.
  4. Award of punitive damages against the Defendant.
  
  Detailed Analysis:
  
  1. Infringement of the Plaintiff's Registered Trademark TATA:
  The Plaintiff, Tata Sons Ltd., filed suits for permanent injunction, damages, rendition of accounts, and delivery of infringing materials against the Defendants. The Plaintiff, established in 1917, is the principal investment holding company of the Tata Group, which is recognized as one of India's most trusted business houses. The Plaintiff claimed exclusive rights to the TATA trademark, which is registered in various classes and has been used extensively since 1917. The Defendants in Suit No. 264/2008 were accused of using the trademark A-One TATA for their weighing scales and spring balances, which the Plaintiff argued constituted trademark infringement. The court found that the Defendant's use of the TATA mark was likely to cause confusion among consumers and amounted to infringement under Sections 29(1) and 29(2) of the Trademarks Act, 1999.
  
  2. Passing Off the Defendant's Goods as Those of the Plaintiff:
  The Plaintiff argued that the Defendants' use of the TATA mark constituted passing off, as it misrepresented the Defendants' goods as those of the Plaintiff, leading to consumer confusion and deception. The court agreed, noting that the Defendants' use of the TATA mark was likely to mislead consumers into believing that the goods were associated with the Tata Group, thereby damaging the Plaintiff's goodwill and reputation. The court held that a case of passing off was clearly made out against the Defendants.
  
  3. Determination of TATA as a Well-Known Trademark:
  The court extensively discussed the concept of well-known trademarks and the protection they deserve under international conventions and Indian law. The Plaintiff provided evidence of the TATA mark's extensive use, registration, and recognition in India and abroad. The court noted that the TATA mark had been used for over 100 years and was associated with a wide range of goods and services. The court concluded that the TATA mark was a well-known trademark under Section 2(z)(b) of the Trademarks Act, 1999, and deserved protection against unauthorized use.
  
  4. Award of Punitive Damages Against the Defendant:
  The Plaintiff sought punitive damages against the Defendants in Suit No. 264/2008. The court emphasized the importance of protecting well-known trademarks and the need to deter infringers through punitive damages. The court awarded punitive damages of Rs. 2 Lakhs to the Plaintiff, highlighting the significant efforts and investments made by the Plaintiff in building and maintaining the TATA brand. The court also noted that awarding token damages would not serve the purpose of deterring potential infringers.
  
  Conclusion:
  The court restrained the Defendants from using the TATA trademark or any similar mark on their products and awarded punitive damages to the Plaintiff. The court recognized the TATA trademark as a well-known mark and emphasized the need for strong protection of intellectual property rights to encourage foreign investment and protect consumer interests. The judgment underscores the importance of safeguarding well-known trademarks from unauthorized use and the role of punitive damages in deterring infringement.

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• 2011 (3) TMI 1751
  
  The Appellate Tribunal CESTAT Ahmedabad dismissed the appeal for non-prosecution as the appellants did not appear despite notices and repeated adjournments.

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• 2011 (3) TMI 1750
  
  Issues Involved:
  1. Eligibility for compassionate appointment.
  2. Applicability of Railway Board Circulars.
  3. Compliance with the Persons with Disabilities Act.
  4. Validity of the Tribunal and High Court's decisions.
  
  Summary:
  
  1. Eligibility for Compassionate Appointment:
  The appellant sought compassionate appointment following his father's retirement due to medical decategorization. The High Court dismissed the writ petition on the grounds that the appellant did not fulfill the conditions in the Railway Board Circular dated 29th November, 2001.
  
  2. Applicability of Railway Board Circulars:
  The appellant's father was declared medically unfit in certain categories but fit in others. Despite this, he was retired without being offered alternative employment. The appellant argued that the respondents were obliged to appoint him under the instructions dated 7th April, 1983, and 3rd September, 1983, reiterated in the Circular dated 22nd September, 1995. The respondents contended that the appellant's father opted for voluntary retirement under the Railway Board's letter dated 18th January, 2000, which precluded compassionate appointment.
  
  3. Compliance with the Persons with Disabilities Act:
  The Railway Board Circular dated 29th April, 1999, mandated offering alternative employment to employees incapacitated from holding their current posts but fit for lower categories. The appellant's father was not offered such employment, and the respondents failed to provide material evidence that he was offered alternative employment as per the Circular dated 29th April, 1999.
  
  4. Validity of the Tribunal and High Court's Decisions:
  The Tribunal dismissed the appellant's Original Application based on the Circular dated 29th November, 2001, which superseded earlier instructions. The High Court upheld this decision, stating that the appellant was not eligible for compassionate appointment under the policy decision of the Railway Board. The Supreme Court found that the Circular dated 29th November, 2001, was not applicable to the appellant's father, as he was not offered alternative employment under the Circular dated 29th April, 1999. Therefore, the earlier Circular dated 22nd September, 1995, applied, entitling the appellant to compassionate appointment.
  
  Conclusion:
  The Supreme Court allowed the appeal, set aside the impugned judgment, and directed that the appellant be granted employment on compassionate grounds within three months, subject to other eligibility conditions as of 1st September, 1999. The appellant would be deemed to be in service from the date of actual joining. No order as to costs was made.

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• 2011 (3) TMI 1749
  
  Issues Involved:
  1. Validity of prosecution evidence.
  2. Voice identification as substantive evidence.
  3. Legitimacy of search and seizure operations.
  4. Reliability of confessional statements.
  5. Recovery of incriminating articles.
  6. Application of MCOC Act provisions.
  
  Detailed Analysis:
  
  1. Validity of Prosecution Evidence:
  The Supreme Court scrutinized the evidence presented by the prosecution, particularly focusing on the voice identification and the legitimacy of the search and seizure operations. The Court noted that the High Court disbelieved the prosecution's version against accused Nos. 1 to 4, creating a reasonable doubt about the veracity of the evidence.
  
  2. Voice Identification as Substantive Evidence:
  The Court highlighted the High Court's error in treating voice identification as substantive evidence. The High Court had discarded the voice identification of accused Nos. 1 and 2 but upheld it for the appellant based on the same type of evidence. The Supreme Court emphasized that voice identification should be used only as corroborative evidence and not as primary evidence, citing previous judgments that underscore the need for stringent precautions in voice identification.
  
  3. Legitimacy of Search and Seizure Operations:
  The High Court found the search and seizure operations conducted on 8th November 2004 to be suspect, noting that the defense had created a reasonable doubt about the prosecution's claim that the accused were apprehended at Ambika Niwas on that date. The Supreme Court agreed, pointing out that the High Court's conclusions destroyed the entire substratum of the prosecution case.
  
  4. Reliability of Confessional Statements:
  The Supreme Court noted that the High Court had rejected the confessional statements of accused Nos. 2 to 4, as these confessions referenced the search and seizure operations that were found to be dubious. The Court stressed that the confessions were obtained under duress and threats, further undermining their reliability.
  
  5. Recovery of Incriminating Articles:
  The Supreme Court found that the recovery of the revolver from an open space behind the house of the appellant's cousin was of little assistance to the prosecution. The trial court had acquitted the appellant of charges under the Arms Act, and this acquittal was not challenged by the prosecution. Therefore, the High Court's reliance on this recovery was deemed inappropriate.
  
  6. Application of MCOC Act Provisions:
  The trial court had convicted the accused under various sections of the MCOC Act, IPC, and Arms Act. However, the High Court acquitted accused Nos. 1 to 4 of all charges, while upholding the conviction of the appellant. The Supreme Court found that the prosecution had failed to prove its case beyond a reasonable doubt, and the appellant was entitled to the benefit of doubt.
  
  Conclusion:
  The Supreme Court allowed the appeal, acquitting the appellant of all charges and setting aside the conviction and sentence imposed by the trial court and confirmed by the High Court. The appellant was ordered to be set at liberty forthwith unless wanted in any other case.

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• 2011 (3) TMI 1748
  
  Issues involved: Application for post of Munsif, discharge of accused u/s 239 CrPC, complaint against discharge, order of discharge by Full Court, challenge to order of removal, violation of natural justice, probationary period, suitability for job, termination of service.
  
  Application for post of Munsif: The Appellant applied for the post of Munsif, underwent tests and interview, and was declared successful in 2001. Subsequently, he was appointed as a Probationer Munsif and later conferred with the power of Judicial Magistrate 1st Class. While discharging his duties, he passed an order discharging accused persons u/s 239 CrPC.
  
  Complaint and Discharge: A complaint was received alleging that the Appellant discharged accused persons despite rejection of a revision application. The matter was referred to the Standing Committee and Full Court, which decided that the continuation of the Appellant's service was no longer required, leading to his discharge from service by the Government of Jharkhand.
  
  Challenge to Order of Removal: The Appellant challenged the order of removal through a Writ Petition before the High Court, which was dismissed. The Appellant contended that the order of removal without holding an enquiry violated principles of natural justice and cast a stigma on his career.
  
  Probationary Period and Termination: The Respondents argued that the Appellant was on probation when the order of removal was issued in public interest, and it was a justified decision. The Court noted that during probation, the employer assesses the suitability of the employee for continuation in service. In this case, the decision to release the Appellant was based on his overall performance, conduct, and suitability for the job, and it was a termination simpliciter, not removal for indiscipline or misconduct.
  
  Judicial Precedent and Conclusion: Referring to a previous case, the Court emphasized the importance of judicial officers' probity and performance. The Court concluded that the order of termination was a result of the Appellant's unsatisfactory service based on his overall performance and conduct, not stigmatic or punitive. Therefore, the appeal was dismissed, and each party was directed to bear their own costs.

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• 2011 (3) TMI 1747
  
  Issues Involved:
  1. Whether the income from casual members amounts to commercial activity u/s 11(4A) of the Income Tax Act.
  2. Whether the assessee club qualifies for exemption u/s 12A of the Income Tax Act.
  
  Issue 1: Income from Casual Members as Commercial Activity

  The Assessing Officer (AO) observed that the assessee, a Golf Club, received Rs. 67,84,182/- as fees from casual members, who were charged higher rates than permanent members and were not eligible for other facilities. The AO treated this as a commercial activity and invoked provisions of Section 11(4)/11(4A) of the Act, rejecting the exemption u/s 11 for this amount, treating it as business income. The AO allowed 25% of these receipts as expenses incurred for earning such income.

  The CIT (A) disagreed with the AO, stating that the casual membership fee was for allowing the public to play golf, aligning with the club's objective of promoting golf. The CIT (A) noted that the assessee fulfilled the requirements of Section 2(15) and Section 12A of the Act, and thus, the benefit u/s 12A could not be denied. The CIT (A) referenced the CBDT Circular No. 395 and the Supreme Court decision in Radhasoami Satsang Vs. CIT to support this view, leading to the deletion of the addition made by the AO.

  The ITAT upheld the CIT (A)'s decision, agreeing that the casual membership fees were part of the club's charitable activities and not a separate business activity. The ITAT emphasized that the club's activities were consistently recognized as charitable, and the casual membership fees were integral to the club's functioning.

  Issue 2: Exemption u/s 12A

  The High Court noted that the club had been consistently recognized as a charitable institution since its establishment in 1950, with its main object being the promotion of golf. The club had been granted exemption under Section 10(23) from 1967 to 1998 and under Section 12A from 1999 onwards. The department had accepted the club's charitable status in previous and subsequent assessment years, except for the year in question.

  The High Court observed that the AO's undue focus on casual membership fees was misplaced, as this aspect had been previously examined and accepted by the department. The court highlighted that the casual membership fees were part of the club's overall activities and were utilized for promoting golf, aligning with the club's charitable objectives.

  The High Court agreed with the ITAT's reasoning that the casual membership fees were not a separate business activity but part of the club's charitable activities. The court emphasized that the promotion of sports, including golf, is considered a charitable activity under Section 2(15) of the Act, as clarified by the CBDT Circular No. 395.

  Based on these findings, the High Court concluded that no substantial question of law arose in the case and dismissed the appeal, affirming the decisions of the CIT (A) and ITAT.

  Conclusion:

  The High Court dismissed the appeal, holding that the casual membership fees were part of the club's charitable activities and not a separate commercial activity. The club's exemption u/s 12A was upheld, and the AO's addition of casual membership fees as business income was deleted.

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• 2011 (3) TMI 1746
  
  Issues involved: Dispute over levy of penalty u/s 271(1)(c) for assessment year 2005-06.
  
  Facts of the case: The assessee, a Special Purpose Vehicle under BIFR scheme, claimed expenses totaling Rs. 33,23,196, including interest on loans. AO disallowed most expenses, resulting in an addition of Rs. 33,11,617. Penalty proceedings u/s 271(1)(c) were initiated and penalty of Rs. 24,23,604 was levied.
  
  Arguments before CIT(A): Assessee contended that no inaccurate particulars were furnished, and expenses were claimed in good faith. CIT(A) upheld penalty citing non-compliance with project completion method. Penalty was reduced to 100% of tax sought to be evaded.
  
  Tribunal's analysis: Assessee followed project completion method but claimed expenses annually. Disallowance was accepted, but penalty was disputed. Tribunal noted the debatable nature of interest allowance timing. Considering conflicting tribunal decisions and lack of willful concealment, penalty was deemed inappropriate.
  
  Conclusion: Tribunal allowed the appeal, setting aside the penalty imposed u/s 271(1)(c) for the assessment year 2005-06.
  

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• 2011 (3) TMI 1745
  
  Issues Involved:
  
  1. Legitimacy of the Company Law Board's order dated May 17, 2010, regarding the disclosure of documents.
  2. Allegations of improper conduct and mismanagement by AI Champdany Industries Ltd.
  3. Applicability of sections 397 and 398 of the Companies Act, 1956.
  4. Prima facie case establishment for oppression and mismanagement.
  5. Procedural and substantive requirements for document disclosure in company law proceedings.
  
  Issue-wise Detailed Analysis:
  
  1. Legitimacy of the Company Law Board's Order:
  The judgment addresses the appeals against the Company Law Board's order dated May 17, 2010, which directed AI Champdany Industries Ltd. to disclose specific documents. The order was contested on the grounds that it was initially unreasoned and later supplemented by a detailed "common order" on June 10, 2010. The court noted the serious allegation that the detailed order was made in anticipation of an appeal, but found no substantiated grounds for this claim. The court decided to treat the unreasoned order as the order under appeal and ignored the subsequent detailed order.
  
  2. Allegations of Improper Conduct and Mismanagement:
  Blancatex AG and Aldgate International S.A., holding 37% shares in AI Champdany Industries Ltd., alleged that the company's directors intended to engage in real estate business without amending the objects clause of its memorandum, which required their consent. The transfer of Rampur Texpro Unit to Champdany Construction Ltd., a 100% subsidiary, was seen as a means to bypass this requirement. The Company Law Board had earlier restrained Champdany Construction Ltd. from alienating the fixed assets of Rampur Texpro Unit, and this injunction was still in effect.
  
  3. Applicability of Sections 397 and 398 of the Companies Act, 1956:
  The judgment emphasizes that sections 397 and 398 allow for actions against oppression and mismanagement. The Company Law Board has broad powers under these sections, including the regulation of the company's affairs and the termination of agreements. The court highlighted that these proceedings could affect various stakeholders and become proceedings in rem.
  
  4. Prima Facie Case Establishment for Oppression and Mismanagement:
  The court stressed that the Company Law Board should have first established a prima facie case of oppression and mismanagement based on existing pleadings and materials. The Board's approach of ordering document disclosure to establish a prima facie case was deemed erroneous. The court clarified that a prima facie case should be determined based on available evidence and affidavits.
  
  5. Procedural and Substantive Requirements for Document Disclosure:
  The judgment discussed the procedural aspects of document disclosure under the Companies Act, 1956, and the Code of Civil Procedure, 1908. It noted that while shareholders have limited rights to inspect company documents, the Company Law Board has the power to order disclosure if a prima facie case is established. The court found that the Company Law Board had not adequately appreciated the prima facie case before ordering disclosure.
  
  Conclusion:
  The court set aside the Company Law Board's order dated May 17, 2010, and remanded the matter back to the Board for a fresh hearing to determine the prima facie case and reconsider the document disclosure order. The court emphasized the need for the Company Law Board to properly appreciate the prima facie case based on available evidence before ordering disclosure of documents.

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• 2011 (3) TMI 1744
  
  Issues involved:
  The judgment involves the sanction of a Scheme of Arrangement for De-merger and transfer of a division from one company to another u/s 391 and 394 of the Companies Act, 1956.
  
  Details of the Judgment:
  
  Issue 1: Scheme of Arrangement for De-merger and transfer
  - Two companies, Nirma Credit & Capital Private Limited and Nirma Limited, filed petitions for the sanction of a Scheme of Arrangement involving the De-merger and transfer of the Cement and Mining Division from Nirma Credit & Capital Private Limited to Nirma Limited.
  - Nirma Limited, the Resulting Company, is a Listed Public Limited Company engaged in various activities, including setting up a Cement plant and obtaining mining rights in Gujarat.
  - The De-merged Company, Nirma Credit & Capital Private Limited, is engaged in Finance and Investment Division and Cement and Mining Division.
  - The proposed Demerger is aimed at consolidating the Cement and Mining activities in one entity for better economics of scale, administrative convenience, and optimal resource utilization.
  - The Resulting Company will pay consideration based on the fair market price of the division to the De-merged company.
  
  Issue 2: Shareholder Approval
  - Equity Shareholders of the Resulting Company approved the scheme with a statutory majority of 95.53% in number and 99.99% in value at a meeting convened for this purpose.
  - Equity Shareholders and Unsecured Creditors of the De-merged Company also provided consent for the scheme.
  
  Issue 3: Compliance and Objections
  - The petitions for sanction were admitted, and notices were duly advertised in newspapers and gazettes.
  - No objections were raised against the petitions even after publication.
  - The Central Government raised concerns regarding the consideration, details of assets and liabilities, shareholder voting, and compliance with Accounting Standard-14.
  - The issues raised by the Central Government were addressed in an Additional Affidavit, clarifying the legal provisions and compliance aspects.
  
  Conclusion:
  - The court granted the prayers made by the petitioner companies in the petitions.
  - The petitions were disposed of, and costs to be paid to the Central Government Standing Counsel were quantified at Rs. 3,500 per petition.
  
  This judgment approves the Scheme of Arrangement for De-merger and transfer of the Cement and Mining Division from Nirma Credit & Capital Private Limited to Nirma Limited, ensuring compliance with legal provisions and addressing concerns raised during the process.

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