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Indian Laws - Case Laws
Showing 41 to 60 of 64 Records
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2016 (3) TMI 1000
Charge of corruption against the Superintendent of Central Excise, Service Tax Cell, Chennai, Commissionerate - Alleged demand as well as acceptance of tainted money on the part of the appellant/accused - Found guilty under Section 7 and Sections 13(2) r/w 13(1)(d) of the Prevention of Corruption Act, 1988 - Held that:- by way of examining the defacto complainant viz., PW2 the prosecution has clearly proved the demand of bribe alleged to have been made by the accused as well as acceptance of the same. The evidence given by PW2 has been clearly corroborated by decoy witness viz., PW3. Further the evidence given by PWs.2 and 3 have been clearly corroborated by PW4, trap laying officer. Apart from their evidence, Scientific Analyst has also clearly established the case of the prosecution. Non marking of white cover as well as non playing of micro chip are not fatal to the case of the prosecution and those things are nothing but a piece of evidence and the same cannot be construed as a sole piece of evidence in the present case, since in the present case, both demand as well as acceptance of tainted money on the part of the accused have been clearly proved by the prosecution. Therefore, the contentions put forth on the side of the appellant/accused cannot be a basis for disbelieving the case of the prosecution.
Defacto complainant has given picturesque evidence to the effect that the appellant/accused has demanded and accepted tainted money of ₹ 25,000/- and since the said vital aspects have been clearly established on the side of the prosecution, it is very clear that the appellant/accused is liable to be convicted under the sections mentioned in the charge. The trial Court after considering the replete evidence available on record has rightly found the appellant/accused guilty under the sections mentioned in the charge. Therefore, there has neither found any error nor illegality in the convictions and sentences passed by the trial Court. - Decided against the appellant
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2016 (3) TMI 928
Chief Judicial Magistrate exercising his jurisdiction in Corporation area - whether CJM can assist secured creditor in taking possession of secured asset and pass an order in favour of secured creditor for the purpose of taking possession or control of any secured asset? - Held that:- The intention of the Legislature was to achieve speedier recovery of the dues without the intervention of Tribunals or the Courts and for quick resolution of disputes arising out of the action taken for recovery of such dues. Ergo, by conferring jurisdiction on an authority to exercise the power of assistance, which, his counterpart in a Metropolitan area, is exercising, the Court is not interpreting the provision in a different manner so as to negate the intent of the Legislature. Giving jurisdiction to Chief Judicial Magistrates in non-metropolitan area, who are exercising the same functions as that of Chief Metropolitan Magistrates in metropolitan areas, would not in anyway abrogate or contradict the words used in Section 14 of the SARFAESI Act, thereby causing prejudice to any of the parties. On the other hand, it would hasten the process of rendering assistance to the secured creditors to recover possession of their assets thereby achieving the object for which the SARFAESI Act has been introduced.
For the aforesaid reasons, we answer the reference holding that the nomenclature Chief Metropolitan Magistrate referred to in Section 14 is inclusive of Chief Judicial Magistrate in non- metropolitan area and as such the Chief Judicial Magistrate in a non- metropolitan area gets jurisdiction to entertain an application under Section 14 of the SARFAESI Act, 2002.
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2016 (3) TMI 927
Validity of auction - forgeg Vat clearance certificate submitted - forfeiture of earnest money by invoking the bank guarantee and to debar the petitioner firm from participating in future for a period of 3 years - suppression of material facts - Held that:- The petitioner has not only suppressed the material facts in the petition, but has also not come with clean hands. Though the petitioner knew that the impugned action of invoking the Bank guarantee submitted by him was taken by the respondents as the petitioner was found to have submitted forged Vat clearance certificates, the said fact was not disclosed in the petition. It was only when the respondents filed the reply to the effect that such false affidavits and the false certificates were produced by the petitioner before the respondent-authority in order to procure the tender in question, the petitioner has filed the rejoinder stating that the same was done by his Advocate without his knowledge. The said contention is not believable inasmuch as the petitioner himself had filed the affidavit dated 18.10.2014 (Annexure-3), stating interalia that the Commercial Tax certificates issued by the Dy. Commissioner on 21.08.2014 and 14.10.2014 submitted by him were correct and genuine. When the said two certificates submitted by the petitioner raised suspicion about their genuineness, the respondents had inquired from the concerned authority, who vide the letter dated 14.11.2014 (Annexure-R/5) intimated that no such certificates were issued by him. The respondents thereafter had taken the decision to invoke the bank guarantee furnished by the petitioner towards the bid security.
In that view of the matter, the Court is of the opinion that the petitioner being guilty of suppression of material facts and having not come with clean hands, the petition is liable to be dismissed, and is accordingly dismissed with cost of ₹ 50,000/- (rupees fifty thousand), which will be paid by the petitioner to the respondent-Authority within one week. By this order, the stay application and other pending application if any, also stand dismissed.
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2016 (3) TMI 834
Infringement of Trademark - injunction application - prayer made to restrain Hamdard from selling the herbal sweeten syrup, using the trademark 'HAMDARD JAM-E-SHIRIN' - Held that:- We have noted the rival arguments, but would not be dealing with the same, for the reason suffice it to capture the rival arguments and bring home the point that the arena of debate is rich with arguments on either side and therefore without pleadings by Hamdard it is not a case where Qarshi has such a strong prima facie case that injunction must ensue as a sequitur thereto. We do not comment upon whether Qarshi is guilty of suppressing relevant facts which a party claiming injunction must disclose i.e. disclaimers made by it in Pakistan for the reason this issue itself needs a full debate after pleadings are completed. We do not comment upon whether the documents filed by Qarshi would entitle it to an injunction against Hamdard in an action for passing off taking into account that Hamdard is a registered proprietor of the trademark which is under challenge for the reason the law is that in an action for passing off, where the defendant is the registered proprietor of a trademark, the slope to be climbed by the plaintiff has a high degree of incline, and for which documents have to be scrutinized and prima-facie opinion formed.
It is not a case where an ad-interim injunction must ensue forthwith. The full debate needs to be postponed till Hamdard files the written statement and reply to the injunction application along with documents Hamdard relies upon.
Noting that summons in the suit have yet to be served upon Hamdard, but because of notice served in the appeal, Hamdard is aware of the suit and the date of its listing i.e. May 17, 2016 (wrongly typed as May 17, 2015 in the impugned order), we direct that Hamdard shall file a written statement as also a reply to the injunction application within 30 days from today and for which we take on record that the appellant has supplied to learned counsel for Hamdard the suit plaint, application for interim injunction and all documents relied upon and as filed along with the plaint.
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2016 (3) TMI 833
Grant of a higher grade scale to the eligible employees - Held that:- From perusal of the Government Resolution dated 16th August, 1994, it is manifest that the grant of a higher grade scale to the eligible employees who have completed nine years of service is permissible, provided that the employee is eligible to get the promotion on the basis of his overall performance, qualifications and passing the examination if prescribed. It is also material that if the employee gets higher grade scale without passing any competitive examination, he will have to clear the departmental examination otherwise the grant of higher grade scale is to be withdrawn.
However, by circular dated 24.11.2004, the Government of Gujarat modified the earlier Resolution taking note of the High Court's order and directed that in cases where for getting higher pay scales a departmental examination is necessary then in such cases it is equally necessary that the departmental examination should be organised in time. Further by Government Order dated 22.06.2006, it was specifically brought to the notice of the Department that if the higher departmental examination is not organised during the eligibility period for getting the higher pay scales then in such case the higher pay scale benefit cannot be stalled on such ground. In the instant case, admittedly, the higher pay scale was ordered to be granted to the appellant after completion of nine years but the same was withdrawn on the basis of earlier circular of 1994. The High Court has not considered the subsequent circular of 2004 and based on the circular of 1994, the order withdrawing the benefit was upheld. The impugned order passed by the High Court on this account cannot be sustained in law.
Considering the entire facts of the case, vis-a-vis the Government Resolution time to time issued relating to the condition for giving benefit of promotion, we are of the view that the reasons assigned by the learned Single Judge and the Division
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2016 (3) TMI 792
Correct interpretation of pricing clause contained in the tender notice and validity of recovery raised for the past bills - - Whether while calculating the net payable by the CGHS to the petitioner entire Value Added Tax (VAT for short) payable on the product in question should be reduced from the MRP and then the discounted rates offered by the petitioner could be applied or whether the VAT component to be reduced from MRP would be that relatable to only that is borne by the petitioner - Petitioner awarded a new contract for supply of drugs and medicines to CGHS but CGHS started making deductions from the current bills of the petitioner towards the alleged over-payments for the supplies of drugs and medicines under the old contract - Held that:- pricing clause in the old contract refers to the liability of paying all taxes being on the supplier. It is clarified that the CGHS will pay the labelled MRP minus local taxes less as reduced by tendered discount and such quoted offer would remain constant during the entire duration of the contract. The pricing clause provides for three parameters (i) the MRP, (ii) the local taxes which would be the responsibility of the petitioner and (iii) the discount offered by the tenderer. It provides that the CGHS would pay the labelled MRP minus local taxes less the discount offered. Such formula would remain constant during the entire period of the contract. This clause is open to two interpretations. One approach could be that the literal language used in the clause refers to the liability of CGHS to pay MRP minus local taxes less discount. There is no distinction between the local tax to be borne by the suppliers and the rest. However, the other interpretation equally possible is that the CGHS would pay the MRP less the tax component of the supplier reduced by the offered discount. We are inclined to accept the later interpretation. Thus the final formula which the pricing clause provides is that the CGHS will pay the labelled MRP minus local taxes less tendered discount.
The clause in the new contract provides that the bidder would have to offer uniform discount in percentage terms on the MRP (inclusive of all taxes). This clause also provides that such offer shall remain constant during the entire duration of the contract. This pricing clause now thus simplifies the computation of the net payable by the CGHS to the supplier. A simple formula of MRP (inclusive of taxes) less discount to be applied. This is not to suggest that the new clause would govern the interpretation of the old clause. This is only to suggest that the formula that works out the net payable by the CGHS to the supplier after discount has been rationalised and simplified in the new pricing clause. By comparing the Pricing clause in the old contract with the new contract, it is seen that the formula that works out the net payable by the CGHS to the supplier after discount has been rationalised and simplified in the new pricing clause. Therefore, as long as in the earlier bills raised by the petitioner and cleared and paid by the CGHS, the formula of MRP minus the petitioner’s VAT liability less the offered discount on MRP is applied and no error or irregularity is seen. The interpretation now adopted by the CGHS in the formula reproduced hereinabove would not flow from the pricing policy. Also the recoveries raised by the respondents for the past bills already paid are quashed. - Decided in favour of petitioner
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2016 (3) TMI 787
Temporary injunction - infringement of trademark - Held that:- As world shrinks almost to global village, the relevance of the transnational nature of a trademark will progressively diminish into insignificance. The attainment of valuable goodwill will have ever increasing importance. At the present stage, the argument in favour of the Defendant-Appellant that we find holds more water is that in both Milmet and Whirlpool, as distinct from the case before us, the prior user of the successful party predated the date of application for registration of the competing party. The question to examine, then, would be whether prior user would have to be anterior to the date of application or prior to the user by the Defendant-Appellant. In other words, the question before the Court would remain whether the situation on the date of application for registration alone would be relevant, or whether the developments in the period between this date and the date of grant of registration would have any bearing on the rights of the parties. All these considerations will be cast into a curial cauldron to be appreciated by the Court before which the suit is being contested. In these premises, we cannot conclude that a prima facie case has not been disclosed by the Plaintiff-Respondents.
It is important to note that litigation was initiated by Plaintiff-Respondents, not Defendant-Appellant, even though the latter could have raised issue to Plaintiff-Respondents using a similar mark to the one for which it had filed an application for registration as early as in 1992. The Defendant- Appellant finally filed a Notice of Motion in the Bombay High Court as late as 14.12.2005, in which it was successful in being granted an injunction as recently as on 31.3.2012. We may reiterate that every High Court must give due deference to the enunciation of law made by another High Court even though it is free to charter a divergent direction. However, this elasticity in consideration is not available where the litigants are the same, since Sections 10 and 11 of the CPC would come into play. Unless restraint is displayed, judicial bedlam and curial consternation would inexorably erupt since an unsuccessful litigant in one State would rush to another State in the endeavour to obtain an inconsistent or contradictory order. Anarchy would be loosed on the Indian Court system. Since the Division Bench of the Bombay High Court is in seisin of the dispute, we refrain from saying anything more.
All that we would say in the present Appeal is that since the Plaintiff-Respondents have alleged, and have prima facie supported with proof, that they had already been using their trademark well before the attempted user of an identical or closely similar trademark by the Defendant-Appellant, the former would be entitled to a temporary injunction, in light of the abovementioned ‘first in the market’ test. We find that the Plaintiff-Respondents have made out a prima facie case. The two other factors in an interim injunction, namely the balance of convenience and an irreparable loss, are both in favour of the Plaintiff- Respondents, given the potential loss of goodwill and business they could suffer should an injunction be denied. The Defendant-Appellant has been injuncted from using the mark ROFOL since 2005, after having launched products bearing the mark only in the previous year, so the balance of convenience is in favour of allowing the injunction to continue. In Milmet, this Court had taken note of the fact that the unsuccessful litigating party had in the duration of the litigation started using another mark, and found that this would prima facie assume significance in assessing “irreparable loss”. Decision of the Trial Court, as affirmed by the First Appellate Court, is reasonable and judicious
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2016 (3) TMI 769
Seeking modification of sentence order - Recovery of charas - Non-joining of independent witnesses - ASI Bijender Singh at the time of raid asked 4-5 passersby to join the raiding party but none agreed and went away after giving their reasonable excuses - Held that:- the case of the prosecution cannot be thrown away simply because no public witness has been joined at the time of recovery of Charas. This view finds support from the observation made by Supreme Court in P.P.Beeran vs. State of Kerala [2001 (1) TMI 972 - SUPREME COURT] where Supreme Court observed that the testimony of the police officials cannot be rejected on the ground that police official was the sole witness of the recovery of Ganja and the public witness who was examined, turned hostile. Also the conviction can be based on the sole testimony of a sub-Inspector if other circumstances existed to corroborate his testimony. Presumption of honesty is as much available to a police officer which is available to any other official witness. There is no presumption that police officials are liars. The effect of non-joining of independent witness is only that the court has to view the submission of the police or other witnesses with caution and circumspection and the veracity of the same has to be decided before placing reliance upon them for arriving at any conclusion regarding the guilt of the accused. In this case, efforts were made by the police officials to join independent witnesses but, none agreed to join the proceedings but that ipso facto is not a ground to discard the testimony of police officials who stood the test of cross-examination and nothing material could be elicited to discredit their testimony.
Seeking modification of sentence order - Recovery of charas - Non-compliance of Section 42 of NDPS Act - Held that:- Section 42 is applicable only when the secret information pertains to concealment of any narcotic drug or psychotropic substance in any building, conveyance or any enclosed place and when seizure has taken place at a public place. If a search is made in a public place, the officer taking the search is not required to comply with sub-Section (1) and (2) of Section 42 of the Act. Therefore, the provisions of Section 42 of the Act were not legally required to be complied with referred inDirectorate of Revenue and Anr. vs. Mohd. Nisar Holia [2007 (12) TMI 413 - SUPREME COURT OF INDIA], State, NCT of Delhi vs. Malvinder Singh [2007 (6) TMI 505 - SUPREME COURT] and Mohan Lal vs. State of Rajasthan [2015 (4) TMI 688 - SUPREME COURT].
The contention of Public Prosecutor that, there seems to be a typographical error in the cross-examination of this witness is not correct as it was recorded that the report was received in the office at about 1.30 pm because voluminous evidence is available on record to prove that the secret information itself was received at 3.45 pm, therefore, there was no question of sending the information to ACP at 1.30 pm. Under the circumstances, it was rightly observed by learned Special Judge that despite the fact that the provisions of Section 42 of NDPS Act were not legally required to be complied within this case but there is substantial compliance of the same.
Seeking modification of sentence order - Recovery of charas - Competency of ASI Bijender Singh to carry out search being an Assistant sub-inspector - Held taht:- as per single bench judgment of this court in the case of Kamal Thakur vs. The State (Delhi Administration) [1994 (11) TMI 431 - DELHI HIGH COURT], Head Constable being superior in rank to Constable is competent to investigate. Therefore, as Bijender Singh was Additional sub-Inspector in Delhi Police was competent to carry out the search and seizure.
Seeking modification of sentence order - Recovery of charas - Delay of 15 days in sending the parcels to FSL as such, possibility of tampering with the case property - Held that:- pullandas of the samples as well as remaining case property were sealed at the spot itself and seal of BS was affixed thereon. Thereafter, Head Constable Sanjeev Kumar took the sealed pullandas alongwith FSL form and copy of the seizure memo and handed over the same to SHO who affixed his seals of RK on the parcels as well as form FSL. All the sealed pullandas alongwith documents were deposited by Lallu Ram in the Malkhana vide entry No.1881 of Register No.19. Lallu Ram has specifically deposed about the seals of BS and RK found affixed on these pullandas and the form FSL. FSL result also goes to show that the above description of the seal were found to be mentioned and that the seals affixed on the sample pullandas were found to be in intact condition and it tallied with the specimen seals as per the forwarding letter. Moreover, nothing has come on record from which it can be presumed that the sealed pullandas of the samples or the remaining case property were tampered with at any stage. Therefore, mere delay in sending the samples to FSL does not cast any dent on prosecution case.
Seeking modification of sentence order - Recovery of charas - Case property deposited in the night but submitted the same in the next morning hours - Held that:- as per storeroom register, the case property was deposited on 14.07.2010 at 11.55 am. This submission, which initially seemed to be attractive, was dispelled by learned Public Prosecutor for the State by submitting that the deposit was made vide DD No. 39A, therefore, the original DD No.39A was summoned which clearly reflects that the deposit was made by Inspector Ramesh Kalsan at 11.55 pm. That being so, there is nothing on record to show that the case property was at any point of time tampered with till it reached FSL. Therefore, mere delay in sending the samples to FSL does not cast any dent on prosecution case.
Seeking modification of sentence order - Recovery of charas - Non-compliance of Section 50 of the NDPS Act - Original notice under Section 50 of the Act does not bear signatures of the accused - Held that:- it has come in evidence that before taking search of the accused he was apprised of the legal right to be searched before a Magistrate or a Gazetted Officer and thereupon a notice under Section 50 NDPS Act Ex.P5 was duly served upon him. Mere fact that this notice does not bear his signatures does not raise any suspicion in regard to serving of this notice because the carbon copy of the notice bears his signatures regarding receipt of the notice and thereafter since he claimed himself to be illiterate his reply was written by ASI Bijender Singh and bears signatures of accused at point X.
Seeking modification of sentence order - Recovery of charas - One sample out of two taken sent to FSL - Held that:- two samples were taken out but only one of the parcel was sent to FSL does not make the prosecution case suspicious because out of the entire case property, two samples were taken. That being so, even if only one parcel is sent to the FSL and as stated by learned Public Prosecutor for the State that second sample was taken as a precautionary measure that if for some reason the FSL require another sample, the same could have been sent to FSL, deserves credence.
Therefore, the appellant has been convicted and sentenced to the minimum sentence period under the Act and the impugned order is not to be interfered with. - Decided against the appellant
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2016 (3) TMI 763
Maintainability of appeal - constitutionality of sections 2, 12 and 15(a) of the Enforcement of Security Interest and Recovery of Debts Laws (Amendment) Act, 2012 notified on 3rd of January, 2013 and the said Act to have brought into force as well on 15th January, 2013 - Held that:- The petitioner having filed a writ petition before the High Court under Article 226 of the Constitution of India, the writ petition having been admitted by the Court, the High Court having granted an inter im order which has worked itself out and the petition is still pending before the High Court, filing a writ petition under Article 32 of the Constitution of India before this Court is nothing but an abuse of process of the Court, if not misuse.
Having invoked a constitutional remedy before the High Court under Article 226 of the Constitution of India, the petitioner cannot, under Law, file another petition under Article 32 of the Constitution of India on identical set of facts for identical reliefs. Writ petition is dismissed with costs of ₹ 1,00,000/- (rupee one lakh only) to be deposited with the Supreme Court Legal Services committee within four weeks.
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2016 (3) TMI 762
Cheque bounce case - offence punishable under section 138 and 142 of the Negotiable Instruments Act, 1881 - Held that:- section 118(g) contains a mandate that until the contrary is proved the holder of a negotiable instrument shall be presumed to be a holder in due course. Thus, there is no escape for the court from drawing such presumption - Whatever defence has been taken by the accused respondents as pointed out by the learned counsel appearing for the respondents before us, cannot be a ground for quashing a criminal prosecution.
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2016 (3) TMI 695
Offenses punishable under Sections 409 and 420 of the Indian Penal Code - bouncing of cheques - appellant having already been convicted under Section 138 of the Negotiable Instruments Act, 1881 - Held that:- After hearing learned senior counsel/learned counsel for the parties, perusing the impugned judgment and order and also the order passed in proceedings arising out of Section 138 of NI Act, apart from the fact that the decree is obtained by the respondents in respect of the very same matter, we are of the opinion that it is a clear case of abuse of the process of the court by dragging the appellant to prosecute him for the offences punishable under Sections 409 and 420 of the Code. In our considered view, the reliance placed upon the judgment of this case in the case of Kolla Veera Raghav Rao (2011 (2) TMI 1257 - SUPREME COURT OF INDIA ) is aptly applicable to the fact situation. Applying the said principle and in view of the decree obtained by the respondents against the appellant herein, the impugned judgment and order is liable to be set aside and is set aside accordingly. A higher amount cannot be claimed by the respondents against the appellant.
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2016 (3) TMI 694
Order of acquittal reversed - present appellant has been convicted by the High Court under Section 302 of Indian Penal Code, 1860 (for short “IPC”), and sentenced to imprisonment for life and directed to pay a fine ₹ 5,000/- and in default of payment of fine he is directed to undergo rigorous imprisonment for a further period of six months - Held that:- There are three injured eye witnesses in the present case, namely, PW-1 Amrik Singh, PW-2 Sukhchain Singh and PW-3 Raj Singh. It is a case of day light incident. Injuries on the person of said eye witnesses have been corroborated by PW-4 Dr. Sarabjit Singh Sandhu, PW-5 Dr. Manjit Singh and PW-14 Dr. S.P. Singla. Ocular testimony of eye witnesses cannot be discarded lightly. Once the prosecution has discharged its burden, the burden to prove that appellant Darshan Singh was not present with other accused at the place of incident and had gone elsewhere, lies on him. Injured eye witnesses have assigned specific role as to how he assaulted Santa Singh who suffered ante mortem injuries which gets corroborated from the autopsy report of Santa Singh. There are as many as five stabbed wounds out of the six ante mortem injuries.
The word alibi means “elsewhere”. The plea of alibi is not one of the General Exceptions contained in Chapter IV of IPC. It is a rule of evidence recognized under Section 11 of the Evidence Act. However, plea of alibi taken by the defence is required to be proved only after prosecution has proved its case against the accused. In the present case said condition is fulfilled.
After scrutinizing the entire evidence on record, we do not find any illegality in appreciation of evidence, or in arriving at the conclusion as to the guilt of the present appellant by the High Court.Therefore, for the reasons discussed above, we find no force in this appeal which liable to be dismissed.
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2016 (3) TMI 652
Criminal prosecution for dishonour of a cheque for higher amount - Held that:- In the instant proceeding the parties have agreed that between the parties the total outstanding amount shall be treated as ₹ 1,80,00,000/- (Rupees one crore eighty lac only) and the same shall be paid by the respondents to the appellant in regular monthly instalments of ₹ 15,00,000/- (Rupees fifteen lac). We accordingly direct that the respondents shall pay the first instalment of ₹ 15 lac by first week of April 2016. The remaining 11 instalments of ₹ 15 lac each shall be paid regularly by the first week of each succeeding month. On admission or proof of such payments in accordance with the aforesaid arrangement, the complaint case shall stand quashed if the entire amount of ₹ 1,80,00,000/- is paid by the respondents to the appellant by the first week of March 2017. Till then the complaint case shall remain in abeyance. It is made clear that if the entire payment is not made within the time indicated above then this order shall stand recalled and the complainant will be at liberty to move the concerned court for proceeding with the criminal case any time in April 2017 by virtue of the present order. The appeal is disposed of in the aforesaid terms.
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2016 (3) TMI 601
Debenture-trustee initiation proceedings before the Debt Recovery Tribunal - Whether a debenture trustee suing on behalf of the debentureholder for recovery of sums payable to the debentureholder can file a suit on the original side of this Court since suit is for recovery of the debt? - Held that:- On plain reading of clause (g) of section 2 it appears that the word `Debt' has been given a very wide meaning. It means any liability which is claimed as due from any person by a bank or a financial institution or by a consortium of banks or financial institutions during the course of their business activity. In the decision of the Apex Court in the case of Eureka Forbes Limited Vs. Allahabad Bank relied upon by the first defendant, it was held that the word debt in the RDB Act cannot be given a restricted meaning and the legislature has not intended to restrict it to the relationship of creditor and debtor. However, subsection 1 of section 17 confers jurisdiction on the DRT to deal with the applications made by the banks and financial institutions for recovery of debts “due to such banks and financial institutions”. Thus, DRT can entertain an application for recovery provided the application is made by a bank or a financial institution for the recovery of debt due to such bank or financial institution. If recovery is sought of a debt which is not due to a bank or a financial institution, the DRT will not get jurisdiction under section 17.
It will be necessary to make a reference to the Regulations framed by the Securities and Exchange Board of India under section 30 of the Security and Exchange Board of India Act,1992. The said Regulations are the Securities and Exchange Board of India (Debenture Trustees) Regulations,1993 (for short “the Regulations”). Clause (bb) of the Regulation 2 defines a debenture trustee to mean a trustee of a trust deed for securing any issue of debentures of a body corporate. Clause (ba) of Regulation 2 defines a debenture by giving the same meaning to it which is provided in subsection 12 of section 2 of the Companies Act,1956.
It is the obligation of the debenture trustee to enforce the security in the interest of the debenture holders. Moreover, it is the obligation of the debenture trustee to carry out such acts as are necessary for the protection of the debenture holders and to do all the things necessary in order to resolve the grievances of the debenture holders.
On plain and simple reading thereof a bank or a financial institution can file applications before the DRT for “recovery of debts due to such bank or financial institution”. If a bank files an application for recovery of an amount which is not due and payable to itself, the DRT will not get jurisdiction under section 17. For example, a suit filed by a bank acting as an executor of a will seeking to recover amounts due to the estate of the deceased will not come under the purview of section 17. Such proceedings will not be the one to recover the debt due and payable to the bank itself. In such a case, the jurisdiction of a Civil Court is not excluded. After the decision of the Division Bench in the case of Krishna Filaments, section 17 has not undergone any amendments. The definition of financial institution was amended for including therein a securitisation company or a reconstruction company which has obtained a certificate under section 3(4) of the Securitisation Act
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2016 (3) TMI 551
Validity of auction orders - auction conducted by respondent No.1 - Bank of Baroda, ARM Branch, Himayath Nagar, Hyderabad, and consequential issuance of Certificate of sale of moveable properties in favour of respondent No.2 in respect of movable properties of the petitioner - non receipt of balance 75% of the bid price within fifteen (15) days after confirmation of sale - contravention of the mandatory requirement provided by the provisions of Sub-Rule (4) of Rule 9 of Rules 2002
Held that:- The Bank is attempting to take shelter under the interim order passed which was dismissed on 01-06-2015, and also the factum of preferring appeal by the petitioners which was also dismissed on 20-08-2015, and stating that only on obtaining certified copy of the order of dismissal of the writ appeal on 04.08.2015, it has informed the auction purchaser to deposit the balance bid price; (b) further reason assigned by the Bank is that the movables sought to be auctioned were, in fact, fixtures attached to the lands, which are secured assets in the form of immovable properties sought to be sold in the auction held on 13-03-2015, and therefore, the Bank has waited till disposal of writ appeal on 04-08-2015 for demanding the auction purchaser to deposit the balance 75% of bid price which was deposited on 02-09-2015.
The reasons assigned by the Bank are absolutely unconvincing, since, though, the movables were attached to the lands sought to be sold in the auction held on 13-03-2015 and the sale was effected, nothing prevented it to receive the balance 75% of the bid price within fifteen (15) days after confirmation of sale. Thus, we are of the strong view, that there has been contravention of the mandatory requirement provided by the provisions of Sub-Rule (4) of Rule 9 of Rules 2002.
Further, even a perusal of the letter addressed by the Bank to the auction purchaser on 04-08-2015 shows that the Bank has congratulated the auction purchaser and requested him to pay the remaining balance amount of ₹ 63.50 lakhs immediately to avoid forfeiture of the amount paid and further mentioning that on receiving full amount, it will issue sale certificate. The auction purchaser given a reply to the Bank on 11-08-2015 stating that he was inclined to pay total balance amount before the end of that month i.e., 31-08-2015 and requested to cooperate and oblige. But, the auction purchaser has paid the balance amount of ₹ 63.50 lakhs on 02-09-2015. The Bank in its additional counter, conveniently mentioned that the auction purchaser has sought time till 31-08-2015 basing on the reply given by him, but the said correspondence would not satisfy the requirement of Sub-Rule (4) of Rule 9 and, therefore, absolutely, there is no reason leaving apart plausible reason in getting over the time limit prescribed by Sub-Rule (4) of Rule 9 of Rules 2002.
The auction conducted on 13.03.2015 by the Bank in favour of the auction purchaser - respondent No.2 is liable to be set aside on account of contravention of mandatory provisions of Rules 9(3) and (4) of Rules 2002, and, therefore, the same is set aside. However, we direct the Bank - respondent No.1 to return the bid amount of ₹ 85,00,000/- (Rupees eighty five lakhs only), without any interest thereon, to the auction purchaser - respondent No.2; granting liberty to take measures in accordance with law.
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2016 (3) TMI 507
Repayment of maturity proceeds of the commercial papers as well as on dishonoured cheques - decree in the sum of ₹ 25 crores along with interest at the rate of 18% per annum - claims arise from written contracts contained in what are known as “Series 1 Commercial Papers” and also in a letter dated 10 July 2012 issued by the Defendant in favour of Plaintiff No.1 - Held that:- n appeal under Section 25 is a continuation of the inquiry under Section 16. It will be preposterous to suggest that whereas at the trial stage the suspension provision of Section 22 would require an inquiry under Section 16(1) to be pending, that is to day, a registration under Section 15(1) as having been accomplished, but that at the appellate stage, a registration under Section 15(1) need not be accomplished and no inquiry under Section 16 need to be pending, but that pendency of an appeal even if it be at the preregistration stage entails a consequence under Section 22, namely, suspension of legal proceedings, contracts, etc. in respect of the company under reference. Section 22 clearly indicates that at the trial stage, namely, at the level of BIFR, an inquiry ought to have commenced before Section 22 comes into play. That is the earliest stage in the reference at which Section 22 is triggered. As I have indicated above, that is not the stage at which we are in the present case. Be it at the level of BIFR or at the level of AAIFR, we are still effectively at the preregistration stage. There is no question, in the circumstances, of application of Section 22 to the facts of the present case. The suits are, thus, not required to be stayed.
There is no dispute between the parties that the trades were so reported. The RBI has assigned FIMMDA the task of prescribing operational guidelines for smooth functioning of the commercial paper market in line with international best practices. Operational guidelines issued by FIMMDA effective from June 31, 2001 make detailed provisions regarding trading in commercial papers and the process of redemption upon maturity of the commercial papers. These guidelines lay down a procedure for secondary market transactions in a commercial paper. Nothing could be pointed out by learned Counsel for the Defendant to show that there is any breach in the present case of either the Master Circular issued by RBI or the operational guidelines issued by FIMMDA so as to question either the transfer of the commercial paper from the original holder, namely, IDFC to Plaintiff No.2 or from Plaintiff No.2 to Plaintiff No.1. In fact, the correspondence between the parties, which is uncontested, clearly indicates that the Defendant had not only acknowledged the transfer of the commercial papers in favour of Plaintiff No.1, but had addressed an unequivocal and irrevocable confirmation and acknowledgement of its liability and indebtedness to Plaintiff No.1 for the sums of ₹ 25 crores each towards the payment of maturity proceeds of the subject commercial papers. The Defendant irrevocably confirmed and bound itself to repay the amounts of both commercial papers to Plaintiff No.1 and also interest on delayed payment at the rate of 18% per annum on an annual compounding basis. In these facts, there is no defence on merits as far as the suit claims are concerned.
The rationale of this is that the letter contains a promise to pay; and every promise is a proposal by which the proposer signifies his willingness to do or abstain to do anything, in this case to pay. The proposal becomes a promise only when it is accepted, though to create such promise it is not necessary that there should be an acceptance in writing. The promissee may simply accept the promise before the action. The communication, thus, of the promise to the promissee is complete only when the promissee receives such communication at which place alone he can be said to have signified his acceptance of the promise (at least where there is no other evidence of such acceptance). The debt confirmation letter is clearly addressed by the Defendant to Plaintiff No.1 at its office in Worli, Mumbai and is communicated at that place. A part of the cause of action can certainly be said to have arisen at Mumbai. Upon leave being granted under clause 12 of the Letters Patent, this court clearly has jurisdiction to entertain and try the present suits.
The following order is passed :
(i) The Defendant is granted leave to defend the suits subject to and on payment, respectively, of a sum of ₹ 27,37,94,521/- in Suit No.280 of 2013 and a sum of ₹ 25,69,04,110/- in Suit No.804 of 2013 within a period of twelve weeks from today;
(ii) Upon the payments being made, the suits be transferred to the list of commercial causes;
(iii) Written statements to be filed within a period of six weeks from the date of deposit of the amounts in terms of clause (i) above;
(iv) The Prothonotary & Senior Master to invest the amounts deposited by the Defendant, if any, in fixed deposit/s of Nationalised Bank initially for a period of one year, thereafter to be renewed from time to time, so as to abide by the final orders that may be passed in the suits;
(v) The Summonses for Judgment are disposed of accordingly.
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2016 (3) TMI 503
Copy of the documents lying in 42 gunny bags seized by Surat Police demanded - Payment of requisite fees - Held that:- Once the statement, under the instruction of the officer, was made before this Court by the learned Senior Counsel appearing for the respondent No.1 and the same is also reiterated today during the course of hearing, respondent No.1 shall provide the copy of the documents lying in 42 gunny bags to the applicant on payment of requisite fees. As and when such application is given by the applicant to the respondent No.1, the respondent No.1 shall provide the certified copies of required and necessary documents to the applicant so as to enable him to defend the pending trial against him. It is clarified that before submitting the application for demanding required and necessary documents, the applicant or his counsel is permitted to inspect the documents lying in 42 gunny bags which are in the custody of respondent No.1. After the receipt of the application from the applicant, the respondent No.1 shall provide the certified copies of the documents asked for, which are lying in 42 gunny bags, to the applicant within a period of 4 weeks.
It is further clarified that this order is passed in the facts and circumstances of the present case and with a view to see that the fair opportunity is provided to the applicant to defend his case before the learned Sessions Court in the pending trial and this order shall not be treated as precedent.Rule is made absolute to the aforesaid extent.
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2016 (3) TMI 424
One Time Settlement in respect of the dues of the applicant - Held that:- The opponent No.5-IDBI Bank has accepted One Time Settlement in respect of the dues of the applicant agreeing to accept crystalised amount of ₹ 66.38 lakhs, following directions are issued.
(i) Applicant and opponent No.5-Industrial Development Bank of India Limited are permitted to give effect to their One Time Settlement of dues as above;
(ii) Registry of this Court shall issue a cheque after breaking Fixed Deposit, if required, out of the amount lying with it pursuant to order dated 15th January, 2009 in Special Civil Application No.11524 of 2002 so as to issue cheque in the name of “Industrial Development Bank of India Limited”;
(iii) Since under the One Time Settlement Scheme deadline for acceptance of the amount if fixed 15th March, 2016, Registry shall see to it that cheque is issued on or before 15th March, 2016;
(iv) Upon receipt of the aforesaid amount, opponent No.5-IDBI Bank shall issue No Due Certificate to the applicant within two week;
(v) Balance amount shall remain invested in the Fixed Deposit.
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2016 (3) TMI 382
Determination of amount deposited under SARFAESI Act - what sum (claimed by the secured creditor) is to be taken into consideration by the DRAT whilst determining the amount that ought to be deposited by the borrower under section 18 of the SARFAESI Act (before its appeal can be entertained)? - whether the DRAT was justified in ordering the Petitioner to deposit a sum of ₹ 20,00,000/-? - Held that:- Section 13(2) notice issued by the Respondent – Bank to the Petitioner was dated 14th August, 2007. In the said notice the amount claimed as due from the Petitioner was ₹ 96,14,085.61 together with future interest. From the date of the section 13(2) notice (i.e. 14th August, 2007) to 28th February 2012, admittedly no payments were made by the Petitioner. As on 29th February, 2012 the outstanding dues owed by the Petitioner along with the interest accrued thereon came to ₹ 1,65,36,770.61. On the very same date (i.e. 29th February, 2012), the Respondent – Bank forfeited the deposits of the Petitioner lying with it in the sum of ₹ 5,29,441/-and gave credit for the same in the loan account. Thereafter, one of the guarantors (viz. Mr K.P. Malkani) sold one of the mortgaged properties with the consent of the Respondent – Bank and the sale proceeds thereof to the tune of ₹ 1,18,00,000/- were deposited with the Respondent – Bank on 24th March, 2012.
After giving due credit for the aforesaid amounts (Rs.5,29,441/- plus ₹ 1,18,00,000/-), the amount outstanding as on 24th March, 2012 was ₹ 52,24,200.16. Admittedly, no further payments were made by the Petitioner. The DRAT has taken into consideration this figure of ₹ 52,24,200/- for determining the amount that had to be deposited under the 2nd proviso to section 18(1) of the SARFAESI Act. It is pertinent to note that the appeal and the waiver application preferred by the Petitioner before the DRAT, were filed on 4th March, 2010. On the said date, the outstanding of the Respondent – Bank was in excess of ₹ 96,14,085/- as no payments were made by the Petitioner between the date when the section 13(2) notice was issued (14th August, 2007) and the date of filing of the appeal and waiver application (4th March, 2010).
However, this waiver application was heard by the DRAT on 30th June 2014. By the time, the DRAT heard the waiver application, the Petitioner had made part payments of ₹ 1,23,00,000/- (approximately) towards its debt due to the Respondent - Bank. It is in this view of the matter that the DRAT whilst determining the amount to be deposited under the 2nd proviso to section 18(1) of the Act took into consideration the figure of ₹ 52,14,200/-. Looking to these facts and the clear language of the 2nd proviso to section 18(1) of the SARFAESI Act, we do not think that the DRAT committed any error in directing the Petitioner to deposit a sum of ₹ 20,00,000/- with the Registry of the Appellate Tribunal within a period of eight weeks from the date of the said order in two equal installments. We find that the said order is not only in conformity with the provisions of section 18 of the SARFAESI Act but does complete justice between the parties as it gives credit for the amounts paid by the Petitioner to the Respondent – Bank before directing the Petitioner to deposit a sum of ₹ 20,00,000/- as a condition precedent to entertaining its appeal. In this view of the matter, we do not think that any case has been made out by the Petitioner for review of our order dated 10th June, 2015. No illegality and / or perverse in order dated 30th June, 2014 passed by the DRAT. Consequently, we do not find any error in our dated 10th June, 2015 requiring interference in review jurisdiction. The Review Petition is accordingly dismissed.
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2016 (3) TMI 381
Maintainability of prosecution launched under section 138 of the Negotiable Instruments Act against a partner alone without joining the partnership firm - Held that:- As supported by the judgment of the Delhi High Court in Vijay Power Generators Ltd. vs. Sumit Seth,[2014 (5) TMI 1088 - DELHI HIGH COURT], wherein also it has been held that unless the partnership firm is prosecuted and convicted, the partner thereof cannot be convicted with the aid of section 141 of the NI Act.
Considering that by allowing this writ petition, this Court is quashing the process issued against the petitioner for not joining the partnership firm, the interests of justice require that liberty be given to the respondent no.1 to move before the Court of competent jurisdiction for appropriate relief with a petition under section 14 of the Limitation Act seeking exclusion of the period during which he was prosecuting this case.
As a result, all the four writ petitions are allowed. The process issued against the petitioner alone for the offence under section 138 read with section 141 of the NI Act without joining the partnership firm stands quashed and set aside. However, it will be open for the respondent no.1 to move the Court of competent jurisdiction for appropriate relief with a petition under section 14 of the Limitation Act seeking exclusion of the period during which he was prosecuting this case.
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