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®INDIAN LEGAL IMPETUS

MARCH 2020. Vol. XIII, Issue III

E-337, East of KailashNew Delhi - 110065, INDIA

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S i n g h a n d A s s o c i a t e s

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Manoj K. Singh Founding Partner

EDITORIAL

Dear Friends,

We are pleased to present the March, 2020 for our monthly newsletter “Indian Legal Impetus”. In this edition we have covered recent developments, case laws and issues relating to various discipline of laws in India.

The first article analyses the judgements passed in V.P. Arora v. Punjab National Bank and Ms. Sujata Kapoor v. Union Bank of India and others broadly discussing the principle of “one main residential house”, which is exempted from attachment or from being put to sale in execution of the decree in terms of proviso (ccc) of Section 60(1) Code of Civil Procedure, 1908. The next article of the edition deals with the unequal bargaining power in commercial contracts with various authorities specifically with respect to the abuse of dominant position by National Highway Authority of India by taking unconditional waivers from concessionaires. The article seeks to examine this basis three questions namely; (i) whether as an enterprise, it can abuse its dominant position under the Competition Act, 2002 (ii) whether while performing a sovereign function, it is outside the purview of the Competition Act, 2002 and (iii) Whether the contractual rights of any party can be waived off by a letter given by any party.

The next article analyzes the methods of challenging loss of profits claimed by parties in commercial construction contracts. It delves into the several criteria taken into account to determine and ascertain the probably loss of profits and also discusses the position taken by Indian courts in this regard. The next article discusses at length the journey of one of the most successful world economies in going from non-existence of arbitration background twenty-five years ago to being the world’s leader in the field of International Arbitration by setting up Singapore International Arbitration Centre. It discusses the procedure and dispute resolution mechanism adopted by it to make itself the hub for international arbitration in the world.

The next author has sought to detail the legal difference between compensation and damages. In her article, she has explained that compensation and damages although having been used simultaneously and interchangeably hold striking dissimilarities and that before ascertaining the quantum of both these claims, it is primary to consider the distinction between the two basis the facts in hand.

As we all would agree, in modern times, there is a great need to make statutory changes to develop a more commodious approach towards civil and criminal trials and to lessen the burden not only on investigators and judges but also on the witnesses. The next article deals with recording of evidence through video conferencing that will expedite the disposal of matters and increase the efficiency of all parties involved. Discussing changes to increase ease and developing convenience in the approach towards statutes, the next article discusses the key changes sought to be brought by the Companies (Amendment) Bill, 2020 to promote ease of doing business in India. As the readers are on the subject of evolving laws to promote ease of doing business, the next article of the edition discusses the evolving legal system to carve out a framework for online intermediaries which has led to a world that is full of transparency, product variety and time efficiency.

The next article discusses the judgement passed in New India Assurance Co. Ltd. Vs. Hilli Multipurpose Cold Storage Pvt. Ltd. which addressed, discussed and settled two questions namely; (i) whether the District Forum has the power to extend the time for filing the response beyond the period of 15 days, in addition to 30 days as mandated by Section 13(2)(a) of the Act, and (ii) what would be the commencing point of limitation of 30 days stipulated under Section 13 of the Act.

Going further, the next article discusses the mother statute basis which, the Government of India has been passing all the orders and directions amid COVID-19. The author has critically analyzed the Epidemic Act, 1897 vis-à-vis the pandemic of COVID-19. The author of the next article has sought to critically analyse the positive steps taken by the Government to reduce criminal offences against women including rape. The author has detailed as to how the Government needs to focus on formulating preventive laws more than on remedial laws. Lastly, the next article discusses about the scope of Right to Information Act and its applicability on Board of Control for Cricket in India to ensure transparency in the day to day functioning of the board.

We hope that our esteemed readers find the below articles informative and find the information useful enabling them to understand and interpret the recent legal developments. We welcome all kinds of suggestions, opinion, queries or comments from all our readers. You can also send in your valuable insights and thoughts at [email protected].

Thank You.

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SINGH & ASSOCIATES ADVOCATES & SOLICITORS

NEW DELHI E-337, East of KailashNew Delhi - 110065 INDIA GURUGRAM7th Floor, ABW Tower, MG Service RoadSector 25, IFFCO Chowk, Gurugram Haryana -122001 INDIAMUMBAI Unit No. 101, 10th Floor Sakhar Bhavan, Plot No. 230Ramnath Goenka MargNariman Point, Mumbai - 400021, INDIABENGALURU Condor Mirage, 101/1, 3rd Floor, Richmond Road, Richmond Town, Bengaluru - 560025, INDIA

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For internal circulation, information purpose only, and for our Clients, Associates and other Law Firms.

Readers shall not act on the basis of the information provided in the Newsletter without seeking legal advice.

INDIAN LEGAL IMPETUSVolume XIII, Issue III

2020 © Singh & Associates

www.singhassociates.in

All ©Copyrights owned by Singh & Associates R


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Co

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Managing Editor Manoj K. Singh

Published by Singh & Associates

Advocates and Solicitors

Editor Moonmoon Nanda

Anjani Wadhwa

1. ONE MAIN RESIDENTIAL HOUSE: EXEMPTION FROM ATTACHMENT 04

2. ABUSE OF DOMINANT POSITION BY THE NHAI & THE WAIVER CLAIMED AGAINST THE CONCESSIONAIRE 07

3. CHALLENGING COMPUTATION OF LOSS OF PROFIT: LACK OF EVIDENCE AND HIGH DEGREE OF SPECULATION 10

4. SINGAPORE INTERNATIONAL ARBITRATION CENTRE AND ITS FINANCIAL AND LEGAL IMPACT ON SINGAPOREAN ECONOMY 12

5. DIFFERENCE BETWEEN COMPENSATION AND DAMAGES 15

6. E-EVIDENCE IN INDIA - CROSS - EXAMINATION THROUGH VIDEO CONFERENCING 18

7. PROMOTION OF EASE OF DOING BUSINESS BY LEGISLATURE VIA INTRODUCTION OF THE COMPANIES (AMENDMENT) BILL, 2020 22

8. ADVENT OF ONLINE INTERMEDIARIES & THEIR UNDER REGULATION THE INDIAN LAW 24

9. TIME LIMITATION FOR THE OPPOSITE PARTY FOR FILING RESPONSE TO THE COMPLAINT : AN ANALYSIS OF NEW INDIA ASSURANCE CO. LTD. V. HILLI MULTIPURPOSE COLD STORAGE PVT. LTD (CIVIL APPEAL NO.10941 10942 OF 2013) 27

10. THE EPIDEMIC ACT OF INDIA 1897: AN ANALYSIS VIS-À-VIS THE COVID-19 PANDEMIC 32

11. NIRBHAYA CASE: DO WE CONTINUE TO FAIL? 34

12. BCCI UNDER THE AMBIT OF RIGHT TO INFORMATION: TO BE OR NOT TO BE? 37

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ONE MAIN RESIDENTIAL HOUSE: EXEMPTION FROM ATTACHMENT

VISHAL GERA

INTRODUCTIONThis article revolves around the concept of “One Main Residential House”, which is exempted from attachment in terms of proviso (ccc) of Section 60(1) of Code of Civil Procedure, 1908 (“CPC”). The relevant section and proviso are reproduced herein below:

“60. Property liable to attachment and sale in execution of decree.

Provided that the following particulars shall not be liable to such attachment or sale, namely:

60(ccc): one main residential house and other buildings attached to it (with the material and the sites thereof and the land immediately appurtenant thereto and necessary for their enjoyment) belonging to a judgment debtor other than an agriculturist and occupied by him….”

The Hon’ble Division Bench of High Court of Delhi in December 2019, pronounced a judgment with respect to the applicability of proviso (ccc) of Section 60(1) of CPC, in the state of Delhi after it was inserted in the CPC by the way of an amendment. One of the judgments of the Hon’ble Division Bench of the very same Hon’ble High Court of Delhi in the year 1991, had invoked the said provision and answered the applicability and exemption of attachment in affirmative.

Both the judgments have been analyzed in detail below.

V.P. ARORA V. PUNJAB NATIONAL BANK1

In this case, a money decree was passed against one OP Arora, and his son VP Arora was a Judgment Debtor in the capacity of a guarantor. OP Arora died; the execution was carried out and the main residential house of OP Arora was attached. The decree holder (PNB) moved an application against the legal representatives after it came to know of OP Arora’s

1 1992 (48) DLT 367

death. Wife of OP Arora, Shanti Devi along with VP Arora were brought on record as LRs. Shanti Devi filed objections claiming defense under proviso (ccc) of Section 60(1) of CPC. Shanti Devi died leaving behind a will, in favour of VP Arora.

VP Arora then became the owner of the house which was once owned by OP Arora. It is pertinent to mention that VP Arora was a party to the proceedings, in the capacity of Judgment Debtor.

The question that arose for consideration before the division bench of Delhi High Court in the case was whether the Judgment Debtor who becomes the owner of a house after passing of decree or attachment, which happens to be his main residential house, can claim the benefit of proviso (ccc) of Section 60(1) of CPC?

After perusing the facts of the case, along with the relevant provisions of Hindu Succession Act which held relevance after the death of OP Arora, and proviso (ccc) of Section 60(1) of CPC, while determining the fate of the suit property; the Court answered the question raised before it and held:

“It hardly matters whether he owned the house when decree was passed, or he comes to own the house at a time when it is sought to be attached or sold. That is why the law framers used the word ‘or’ between attachment and sale.”

Finally, the court came to the conclusion that the house in dispute is not liable to be sold till VP Arora continues to be a Judgment Debtor and continues to possess it as main house.

MS. SUJATA KAPOOR V. UNION BANK OF INDIA AND OTHERS2

In this case, a Writ Petition was preferred by one Ms. Sujata Kapoor as Bonafide Purchaser.

2 W.P(C) 2404/2019, decided on 12.12.2019


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One Shri BR Dougall (BRD in short) had provided guarantee to the proprietor of M/s Atul Food Products Limited to secure his loan obtained from Union Bank of India (UBI in short). Since the loan was not serviced and repaid in time, the UBI initiated recovery proceedings. The DRT passed an ex parte decree against the principal borrower and, inter alia, BRD. Further, BRD was restrained from creating any third-party rights.

The petitioner claimed that BRD had mortgaged the property with Indian Overseas Bank (IOB in short) against a loan his son Vivek had taken for his sole proprietary firm, M/s Vinayak International Inc. IOB initiated recovery proceedings and made an offer for One-Time Settlement. Petitioner’s father and brother had offered to buy the property in her name, following the same. IOB agreed for the sale. The petitioner got the said property mutated in her name.

The petitioner claimed that since the suit property is the only main residence available for her, therefore, it shall be exempted from attachment as per the proviso (ccc) of Section 60(1), Civil Procedure Code, 1908.

The learned DRAT observed that the sale in favour of the petitioner had been executed by BRD after the mortgage had been redeemed by making payment to IOB, so the sale transaction between BRD the father-in-law and the petitioner daughter-in-law could not be said to have been entered into by a mortgager in order to discharge pre-existing contractual liability towards the mortgagee bank. The learned DRAT also noticed the fact that a private sale was made between the father-in-law and the daughter-in-law, who claimed that she had estranged relations with her husband and her in-laws.

“29…..redemption could be by the mortgagor with his own money may be mustered by taking money from the in-laws of his son, as is the case of appellant.”

Even if the attachment of the said property is taken to have been ordered on a previous date, it makes no difference, since the same relates back to, and takes effect from the date on which the notice to pay the arrears, issued under the Schedule, was served upon the defaulter (See Rule 51). The said property was attached while the same was in possession of the BRD (CD-3) in his own right. The Recovery Officer has had no occasion to declare the transfer made by the BRD to be void, since the property was already attached even

prior to the said transfer. The sale made to the petitioner was illegal and illegitimate and was in breach of Rule 16 of IT Act, read with Rule 51.

The issue before the court for consideration was “the scope and interpretation of the provision, i.e., proviso (ccc) of Section 60(1) of CPC, 1908”.

After hearing the parties, the court upheld the DRAT orders on the rejection of the petitioner’s claims and stated that if the petitioner felt that she had been defrauded by BRD, it was for her to sue the estate of BRD.

While considering the proviso (ccc) to Section 60(1) of CPC, the Court noted that the said provision was borrowed from Punjab Relief of Indebtedness Act, 1934 (PRI in short) vide a Central Government notification dated 08.06.1956 through an amendment to Section 35 of PRI Act.

In light of the same, the Court analysed the expressions “judgement debtor” and “debt” used in Clause (ccc) of proviso to Section 60(1) of CPC. While doing so, Court opined that the two terms have to be read in light of the parent legislation, viz., PRI Act.

After perusal of Statement of Object and Reasons of PRI Act, the Court was of the view:

“82. Aforesaid being the position, in our considered view, the expression “judgment debtor” used in Clause (ccc) of proviso to Section 60(1) of the Code has to be read and understood in the context of the meaning ascribed to the expression “debtor” in the parent Act, i.e. the PRI Act as amended, and the expression “judgment debtor” cannot be understood to mean any “judgment debtor”, as generally understood.”

After placing reliance on a Supreme Court judgment, Surana Steels Pvt. Ltd, Vs. Deputy Commissioner of Income Tax and Others3, the Court opined that:

“86. Thus, clause (iv) was read and understood in the context of Section 205 of the Companies Act, 1956. Similarly, the expression “judgment debtor” used in Clause (ccc) of proviso to Section 60(1) of the Code has to be read and understood in the context of the expression “debtor” used in the PRI Act, lest it leads to

3 (1999) 237 ITR 777

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wholly unintended benefits being showered upon “debtors” for whose benefit the said clause was not introduced, and causes injustice to creditors against whom it was never intended to be used as a shield.”

Therefore, finally stating that the clause in the parent Act was introduced to protect the small agriculturalists, domestic servant etc., and hence should be interpreted in the same fashion even after being incorporated in CPC, otherwise it would render benefit to the higher income group people who are likely to exploit the provision to suit their own needs.

The Court, however, refused to place reliance on 2 other judgments being relied on by the petitioner, wherein it was claimed that the Statement of Objects and Reasons of the PRI Act cannot be looked into for the purpose of construing the scope of the amendment introduced in the Code by Section 35 of PRI Act.

“94… The interpretation sought to be canvassed by the petitioner in respect of Clause (ccc) of proviso to Section 60(1) of the Code would encourage fraudulent contrive by debtors to evade their liability which, certainly, would not be conducive to the preservation of the Rule of Law. Therefore, in our view, reliance placed by the petitioner on the aforesaid decisions in Gurudevdatta VKSSS Maryadit (supra) and Ashwini Kumar Ghose (supra) is misplaced.”

The Court while admitting the petitioner’s claim for Right to Shelter, provided for by Article 21 of the Constitution held that:

“99……. The basic need of all human beings, inter alia, of shelter, does not mean that debtors, irrespective of their background, can be granted blanket protection under Clause (ccc) of proviso to Section 60(1) of the Code………..Thus, even this fundamental right is not absolute, and in accordance with the procedure established by law it may be curtailed. The Legislature, in its wisdom, sought to carve out exceptions to Section 60(1) only in exceptional cases of agriculturists, labourers and domestic servants (under Clause (c) of proviso to Section 60(1) of the Code) ………”

Pursuant to the said discussion, the writ petition filed by the petitioner was dismissed.

CONCLUSIONIt is relevant to point out that judgment titled as “Sujata Kapoor Vs. Union Bank of India”4 does not take into account the previous reported precedent i.e. judgment titled as “V.P.Arora vs. Punjab National Bank”5, while deciding the said case. Furthermore, the judgment titled as “Sujata Kapoor Vs. Union Bank of India”6, has been rendered by the Hon’ble Division Bench in the peculiar facts and circumstances which itself becomes clear from the Para 97 of the said judgment as the said property was already attached while the same was in possession of BRD (CD-3) in his own right. The Recovery Officer has had no occasion to declare the transfer made by the BRD (CD-3) to be void, since the property was already attached even prior to the said transfer. It means that the Original Owner was not claiming the benefit of exemption in terms of Proviso (ccc) of Section 60 of CPC, 1908 but the Bonafide Purchaser i.e. Ms. Sujata Kapoor/Petitioner was claiming the benefit as a Bonafide Purchaser from the erstwhile owner, namely BRD(CD-3) who was already under the legal impediment as the property was under attachment by the Recovery Officer.

Lastly, we cannot also lose sight of the principle of Article 141 of the Constitution of India, by referring to reported judgment titled as “Kiran Bala Vs. Surinder Kumar”7, where the Hon’ble Supreme Court gave the benefit of exemption of one main residential house to the Judgment Debtor and was pleased to observe that the said house cannot be attached or put to sale in execution of the decree.

***

4 Supra Note 2

5 1992 (48) DLT 367

6 Supra Note 2

7 1996(4)SCC372


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ABUSE OF DOMINANT POSITION BY THE NHAI & THE WAIVER CLAIMED AGAINST THE CONCESSIONAIRE

SURABHI PANDEY

This article discusses the impact of agreements and letters which NHAI (Authority) requires its Concessionaire’s to sign in order to waive off any damages as per Clause 4.2 and 4.3 of the Model Concession Agreements. It is a general practice of the Authority to seek a letter of waiver from the Concessionaire for not claiming any damages due to the default of the Authority. The Authority is able to obtain such letters because it is in a strong position to do so. Where the Concessionaire refuses to issue such a letter, the Authority uses arm twisting tactics such as withholding the funds of the Concessionaire, blacklisting the Concessionaire prohibiting them to enter into any future projects.

Such actions give rise to various legal questions like (I) Whether the NHAI is an enterprise and can it abuse its dominant position under the Competition Act; (II) Whether the NHAI is performing a sovereign function out of the purview of the Competition Act and (III) Whether the contractual rights of any party can be waived by a letter given by any party.

WE ATTEMPT TO ANSWER THE AFOREMENTIONED QUESTIONS

1. The National Highways Authority of India (hereinafter, the NHAI) is the statutory and government authority for development, maintenance and management of national highways and for matters connected therewith or incidental thereto.

2. The Competition Act, 2002, is an Act inter alia to promote and sustain competition in markets, protect the interests of consumers and to ensure freedom of trade carried on by other participants in Indian markets. It is essential to understand that Section 2(h) of the said Act while defining an ‘enterprise’ also says that any enterprise discharging any activity of the Government relatable to the sovereign functions is not an enterprise. Further,

Section 4 provides that no enterprise shall abuse its dominant position. It also provides for cases when there is an abuse of dominant position. Inter alia, making “conclusion of contracts subject to acceptance by other parties of supplementary obligations which, by their nature or according to commercial usage, have no connection with the subject of such contracts” is an abuse of dominant position. Accordingly, as NHAI falls under the definition of ‘enterprise’ for the purposes of the Competition Act, 2002, it can indulge in dominant behavior under the Competition Act provided it imposes conditions which are discriminatory and are being imposed due to its strength in the market. The same becomes clearer in the case of Madhya Pradesh Power Generating Company Limited v. South Eastern Coalfields Ltd.1, where the enterprise was Coal India Limited and its subsidiaries. It was held by the Competition Appellant Tribunal as under:

“45. The Commission notes that the very insistence by CIL and its subsidiaries upon consumers for executing MoUs in addition to contractual arrangements agreed between the parties by way of FSAs, was subversive of contractual obligations and was a clear indication of abuse of market power by State monopoly. As shown above, the only purpose of MoUs was to dilute the contractual obligations of the seller and to bail them out from legal commitments. The terms and conditions of MoUs were ex facie disposed favorably towards the coal companies and the consumers had no option except appending signatures thereon. No justification for restriction in the indigenous coal in MoUs by the coal companies can be gathered. The impugned conduct appears to be unfair being in contravention of the provisions of Section 4(2) (a)(i) of the Act……

1 2017 SCC Online CCI 28

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CONCLUSION

56. In view of the above discussion, the Commission is of considered opinion that CIL through its subsidiaries operates independently of the market forces and enjoys dominance in the relevant market of sale of non-coking coal to the thermal power producers and sponge iron manufacturers in India. The Commission hence, holds the Opposite Parties to be in contravention of the provisions of Section 4(2)(a)(i) of the Act for imposing unfair/discriminatory conditions through FSA’s and indulging in unfair/discriminatory conduct in the matter of supply of non-coking coal, as detailed in the order…..”

3. With the aforesaid provisions of the Competition Act, 2002, and the observations of the Tribunal, it becomes abundantly clear that the NHAI is exploiting its dominant position by imposing non-commercial conditions upon the contractors due to its strong market position. With these observations the question (I) is answered in the affirmative.

4. As read under Section 2(h), the Competition Act, 2002, excludes all the activities of the government relatable to the Sovereign Functions of the government including all activities carried on by the departments of the central government dealing with atomic energy, currency, defense and space. Unless an entity can be classified as an “enterprise” under the Competition Act, its provisions shall not apply to such entities. Now, the question to be addressed is whether the NHAI could be said to be engaged in sovereign functions to exclude it from the definition of “enterprise”?

5. The Supreme Court of India has discussed in various judgments at length that functions of the State which are primary, inalienable, and non-delegable can be termed as sovereign functions. In Bangalore Water Supply & Sewerage Board v. A. Rajappa2, the Supreme Court, while expounding the dominant nature test, stated that welfare activities or economic adventures undertaken by the government or statutory bodies are not exempted from the application of industrial law under the garb of sovereign

2 (1978) 2 SCC 213

functions. Further, in Agricultural Produce Market Committee v. Ashok Harikuni3, the Hon’ble Court held that the dichotomy between sovereign and non-sovereign functions could be determined by finding which of the functions of the state could be undertaken by any private person or body. In a given case, even in subject on which the state has the monopoly may also be non-sovereign in nature. Mere dealing in subject of monopoly of the state would not make any such enterprise sovereign in nature. Further, in Ideal Road Builders Pvt. Ltd. V. Commissioner of Service Tax, Mumbai (CESTAT Mumbai) it was held that NHAI is only a statutory authority and not a constitutional authority. Therefore, the functions undertaken by such authority cannot be sovereign in nature.

6. Therefore, in such cases, though NHAI is working as a monopolist in the market, its functions cannot be termed as state functions because they are not constitutional functions but commercial in nature; thus, are alienable in nature and can be delegated. The concession agreement in itself depicts the fact that the functions of the NHAI are delegable in nature. Therefore, it cannot claim exemption from the application of the Competition Act, 2002. In view of the above the question (II) is answered in the negative.

7. Before we attempt to answer question (III) it is essential to understand the concept of waiver and its origin. The words waiver, estoppel and acquiesce are used in all such circumstances where a party loses its remedy to enforce a right which ought to have been enforceable in absence of such waiver or estoppel. The House of Lords in Motor Oil (Hellas) Corinth Refineries S.A. v. Shipping Corp. of India4, generally known as the Kanchenjunga Case has held that “waiver” may refer to a forbearance from exercising a right or to an abandonment of a right arises by virtue of a party making an election. An election may arise in the context of a binding contract, when a state of affairs comes into existence in which one party becomes entitled, either under the terms of the contract or by the general law, to exercise a right, and he has to decide whether or not to do so. His

3 (2000) 8 SCC 61

4 (1990) 108 N.R. 280 (HL) para 14, 15


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decision, being a matter of choice for him, is called in law an election. In All India Power Engineering Federation and Ors v. Sasan Power Limited and Ors.5 the Court held that “waiver is an intentional relinquishment of a known right, and that, therefore, unless there is a clear intention to relinquish a right that is fully known to a party, a party cannot be said to waive it.”

8. The aforesaid cases have made clear two things in prerequisite of a waiver - Firstly, an existence of a known enforceable contractual/ statutory right; and secondly, waiver of that right and it shall be done voluntarily. In cases, the letters which are submitted by the concessionaire under arm twisting methods of the NHAI (such as withholding the funds of the concessionaire, blacklisting the concessionaire prohibiting them to enter into any future projects) the said “waiver” cannot be said to be voluntary or intentional waiver of its right to claim damages for default of NHAI. The same is only assented to under the pressure of NHAI to prevent itself from becoming insolvent or getting involved in several arbitrations/ litigations.

9. In view of the above, it cannot be said that the concessionaire has waived its right to enforce the claim of damages, because express terms of the contract cannot be waived by merely a letter which has been written under coercion and / or threats of NHAI; and as the NHAI is performing public duty, any delay caused in the projects is nothing but a loss to the public at large. Therefore, in view of the finding of the Hon’ble Supreme Court in All India Power Engineering Federation and Ors v. Sasan Power Limited and Ors. (Supra), waiver cannot be claimed if public interest is involved. In the light of the aforesaid, the question (III) is answered in the negative.

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5 (2017) 1 SCC 487

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CHALLENGING COMPUTATION OF LOSS OF PROFIT: LACK OF EVIDENCE AND HIGH DEGREE OF SPECULATION

AISHWARYA SATPATHY

In any typical commercial arbitration, the claimant categorizes his claims under various heads. The most common head of claim being the costs that have accrued to it over the period of the contract from the date a breach/expropriation by the other party occurred. Damages suffered by the claimant as a result of such breach are also a usual form of claim. Apart from these, the claimant generally requests to be compensated for speculative loss of profits. It is tricky to quantify such future loss as not only would the claimant have to prove something that never happened but also demonstrate that the profits would have been obtained, “but for...the breach, interference, etc.” It is also incumbent upon the claimant to rule out other causes of loss. In matters relating to infrastructure, such a claim arises when the project does not reach fruition or was delayed owing to reasons attributable to the employer, depriving the contractor of potential profit margins that could have been gained from the project.

DETERMINING PROBABLE LOSS OF PROFITSIt is settled law that where a party is liable for breach of contract, either express or implied, the other party is in general, entitled to nominal damages, although, no actual damages are proved. In this specific context, it has been held that where in the works contract, the party entrusting the work committed breach of contract, the contractor is entitled to claim the damages for loss of profit which he expected to earn by undertaking the works contract1. However, discerning the remoteness of damage and proving the damage with reasonable certainty are crucial for basing a claim on speculative loss of profit.

A party injured by a breach of contract can recover only those damages that either should “reasonably be considered...as arising naturally, i.e., according to the usual course of things” from the breach, or might “reasonably be supposed to have been in the contemplation of both parties, at the time they made the contract, as the probable result of the breach of it.” This

1 Associate Builders v. Delhi Development Authority [Civil Appeal No. 1-531 of 2014 (arising out of SLP (Civil) No. 14767 of 2012)]

principle was first propagated in the landmark case of Hadley v. Baxendale2 which was one of the earliest to grant a claim arising from loss of profit under the head of ‘Special Damages’. However, damages - nominal or actual, have to be proven to a degree of reasonable certainty in order for them to be granted. This basically means that damages are not recoverable for loss beyond an amount the evidence permits to be established with reasonable certainty3

While ascertaining the claim arising from loss of profit, the Arbitral Tribunal would evaluate several criteria, not limited to:

i. Business records, historical financial statements, business financial forecasts, etc

ii. Duration of such forecasts/projections

iii. Ability to continue operations over the duration of projection

iv. Stability and predictability of future costs and revenue

These criteria are often not weighed equally, and tribunals are prone to emphasize more on future profitability than past performance. Arbitral Tribunals have refused to recover speculative losses when there is insufficient evidence to prove that the project could generate positive cash flows4. Projecting of fair market value of the project using Discounted Cash Flow (DCF), in order to draw up potential losses, was objected to for being highly speculative by the respondent and was also upheld by the Tribunal5 as the given asset did not have a history of operations or profitability.

However, in five solar power cases against Spain, tribunals awarded compensation for lost future profits even if the power plants did not have a long history of

2 (1854) 9 EX 341

3 TAS Distribution Co. v. Cummins Engine Co. [491 F. 3d 625, 632 (7th Cir. 2007)]

4 Bear Creek Mining Corporation v. Republic of Peru (ICSID ARB/14/21)

5 Id.


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operations6. The earlier DCF model was upheld as according to the tribunal, power stations have a relatively simple business model, producing electricity whose demand and long-run value can be analysed and modelled in detail based on readily available data.

CONCLUSION: POSITION OF INDIAN COURTSThe Delhi High Court held that the contractor being retained for longer on the project, without any corresponding increase in monetary benefit or freedom to undertake other projects, is a valid ground for being compensated for loss of future profit, even if the contract debarred such a contingency7. The Supreme Court, in 20048, pronounced that it cannot award a claim for loss of profits in the absence of evidence to support such a presumed loss; Indian courts have ever since usually granted claim for loss of profit to the extent of 10% of the contract value as a reasonable amount9 where it has clearly been proven that if not for the breach/delay in contract fulfilment by the respondent, the claimant would have earned profits over the duration succeeding timely execution of the contract10.

While loss of profit has become a common head of claim in project-based arbitration matters, the tribunals are not prone to rely solely on the claimant’s calculations, projections or documentary evidence provided to support the same. The question of ascertaining loss and quantum of damages is often a very technical undertaking and if the claimant fails to pass certain thresholds to prove the quantum of claim that it demands, the tribunal may resort to approaching industry-based experts or arrive at what they consider to be the most reasonable estimate of such loss.

***

6 Eiser Infrastructure Limited and Energia Solar Luxembourg S.à.r.l vs. The Kingdom of Spain (ICSID ARB/13/36)

7 National highways Authority of India v. HCC Ltd. [OMP (Comm) No. 633/2012, decided on 08.07.2014 (High Court of Delhi)].

8 Bharat Coking Coal Ltd. v. LK Ahuja, [(2004) 5 SCC 109].

9 Himachal Joint Venture v. Panilpina World Transport, [AIR 209 Delhi 88].

10 National Highways Authority of India v. AFCONS-APIL Joint Venture, [OMP (Comm) No. 10/2018, decided on 31.01.2018 (High Court of Delhi)]

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SINGAPORE INTERNATIONAL ARBITRATION CENTRE AND ITS FINANCIAL AND LEGAL IMPACT ON SINGAPOREAN ECONOMY

CHANDRIKA SHARMA

INTRODUCTIONThe Singapore International Arbitration Centre (SIAC) was established in the year 1991 for the purpose of facilitating institutional arbitration. It provides administrative and technical assistance in conducting international and domestic arbitration proceedings which are conducted under its own rules and also based on United Nations Commission on International Trade Law (UNCITRAL) arbitration rules. SIAC is mainly based in Singapore at Maxwell Chambers and the awards laid down by it are enforceable in many jurisdictions namely Australia, Thailand, Indonesia, UK, USA, Hong Kong SAR, India, Vietnam, Jordon, China1 and many other signatories of the New York Convention2. Singapore is the Asian hub and world leader for International Arbitration and has become the first choice amongst international businesses when they want to have their commercial disputes resolved3.

DISPUTE RESOLUTION AT SIAC All sorts of dispute resolution processes are hosted in Singapore, covering wide range of subject matter of suits. These processes are administered and facilitated by International Chamber of Commerce. Situated in the heart of South-East Asia, there has been a substantial increase in the total number of suits being referred to arbitration with its seat in Singapore due to various reasons such as:

1. Many foreign companies have their headquarters in Singapore and there has been an increase in establishment of branches or subsidiaries of foreign banks, public and private, in the city.

2. Geographical location which strengthens its connectivity with its neighbouring countries like Indonesia, Malaysia and Thailand.

1 www.siac.org.sg

2 Convention on the Recognition and Enforcement of Foreign Arbitral Awards, New York 1958

3 www.siac.org.sg/64-why-siac/150-facts-figures

3. Modern day infrastructure to cater every need and advance communication facilities.

4. Utmost support of its Courts striving to uphold arbitration agreements, enforcing foreign awards and expressing a public policy that the decision of contracting parties to arbitrate their dispute should be upheld and given effect.4

Having a comprehensive legal infrastructure that supports and at the same time intensively promotes arbitration along with a robust and efficient legal system; judiciary that is supportive of arbitration as a dispute resolution mechanism are the main reasons why Singapore is the most preferred seat of arbitration in the world. The other factors that contribute towards the emergence of Singapore as a leading center for international commercial arbitration include the Arbitration Procedure wherein the post-dispute agreement that has to mandatorily be in writing can be fulfilled in one step i.e. submitting it to the registrar of SIAC5. SIAC’s fee structure is also very simple wherein the parties submitting their dispute to the abovementioned institution only have to pay the administrative fee for using administrative assistance. Arbitrators’ fees is determined based on the quantum of suit and the institution does not apply hourly rate6.

RISE OF INTERNATIONAL ARBITRATION IN SINGAPORE Just twenty years ago, the concept of international arbitration did not exist at all in Singapore but today it has become a globally recognized hub for the same. SIAC has attained global recognition as 80% of the cases it has administered are all international cases. Singapore has one of the fastest growing economies with an estimated GDP per capita of USD 55, 252.40

4 www.siac.org.sg

5 Supra note 5

6 Ibid


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approximately7. This development owes its due credit to the firm governance and the efficiencies led by it8. Singaporean government practices state-capitalism which has a competent economic management and has the ability to deliver sustained economic growth.

The government of Singapore has worked hard to maintain Singapore as the hub of business and international trade and is now bearing the fruits of its work. With the kind of commitment and efforts put in by the Singaporean government to maintain its economic growth, it is not surprising that the country has marketed itself well as an arbitration-friendly nation. The economy of Singapore has grown and has been effectuated by the resources it receives in the form of fees of the arbitrators and the administrative fees that the Arbitration Institutions, mainly SIAC, receive from the parties who register their disputes here. While seeking to attract arbitration, Singapore as a state also ends up attracting international business and international trade which in return is more beneficial for the economy9. It is a settled fact that to ensure economic growth in this modern era of globalization of commerce it is essential to develop and promote a strong system for public international law and a dispute resolution mechanism that resolves disputes relating to it. This ideology has been substantiated by the former President of Iran-United States Tribunal and is quoted below:

“Arbitration accompanied the growth of International Commerce. It saw its role as offering the tools best suited to international business to resolve disputes whenever they arose. The major institutions majorly see their role in facilitating the growth of international business by offering the necessary tools to resolve the disputes arising in international business10.”

The abovementioned texts seeks to convey that growth of international dispute resolution mechanism is complementary to the growth of international business in the state/country. Thereby, having a strong legal system and judiciary that supports alternative dispute

7 Tan Cheng-Han, Dan W Puchniak, & Umakanth Varottil, “State-Owned Enterprises in Singapore: Historical Insights into a Potential Model for Reform” (2015) 28:2 Colum J Asian Law 61 at 65.

8 Ibid

9 Edward Leahy & Carlos Bianchi, “The Changing Face of International Arbitration” (2000) 17:4 J Int’l Arb 19 at 58.

10 Robert Briner, “Globalization and the Future of Courts of Arbitration” (2000) 2:1 Eur J L Reform 439 at 444.

resolution mechanism and not just judicial settlement, is beneficial for the growth of the economy. It is exactly the strategy that Singaporean Government has adopted and become one of the richest countries in the world all due to firm governance that supports arbitration leading to a strong well-built economy. Singapore achieved this is by first developing its legal structure that is arbitration friendly state in order to attract contracts that will mention their seat of arbitration as Singapore11. Further, being a signatory to the New York Convention has helped Singapore to enforce international and foreign arbitral awards with much ease. After attaining domestic expertise in the field of arbitration, it sought to promote international commercial arbitration and drafted the International Arbitration Act12 to regulate international arbitration in Singapore. It has also been advantageous that the government has taken steps to ensure that there is minimal intervention from the country’s Courts in the process of arbitration. This feature of minimal intervention is what SIAC boasts about on its webpage in order to attract disputants to choose their seat of arbitration as Singapore13.

CONCLUSIONSingapore is one of the world’s most prosperous nation with a non-existent arbitration background twenty-five years ago to becoming the world’s leader in the field of International Arbitration14. The efficiency of its legal system and structure is because of the transparency and generosity of its government that provides sound funding to facilitate every field that will lead to development of its economy15. Singapore has very strategically used its regulatory framework to turn itself into world leader in international arbitration and at the same time make it a hub for international trade and business. Along with this, Singapore has also permitted Third Party Funding - a concept in

11 Joshua Karton, The Culture of International Arbitration and the Evolution of Contract Law (Oxford: Oxford University Press, 2013) at 63.

12 SIAC, “What Singapore Has to Offer”, supra note 29; International Arbitration Act (Cap 143A, 2002 Rev Ed Sing).

13 Singapore International Arbitration Centre, “What Singapore Has to Offer” (4 January 2018), online: archived at [SIAC, “What Singapore Has to Offer”].

14 Queen Mary University of London and White & Case, ‘2018 International Arbitration Survey: The Evolution of International Arbitration’, 9-10, https://www.whitecase.com/sites/whitecase/files/files/download/publications/qmul-international-arbitration-survey-2018-18.pdf.

15 Elizabeth MacArthur, Regulatory Competition and the Growth of International Arbitration in Singapore, Appeal Vol. 23 Pg 165

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international arbitration, by introducing a legal framework that will regulate it. These regulations can be interpreted in the Amended Civil Law Act and The Civil Law (Third-Party Funding) Regulations 201716. Singapore’s success in international arbitration is the outcome of the strength of its legal system and the support of the government in ensuring a policy of non-intervention that has led to increase in economic efficiencies.

***

16 Indranee Rajah SC (Senior Minister of State for Law), Second Reading of the Civil Law (Amendment) Bill (10 January 2017) https://sprs.parl.gov.sg/search/topic.jsp?currentTopicID=00010624-WA&current


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DIFFERENCE BETWEEN COMPENSATION AND DAMAGESBHAGYASHREE GANWANI

The words compensation and damages are frequently used in contracts, in cases of accidents, libel, personal injury cases and in other cases which are civil in nature in the court of law. Though, there is a significant difference between the two but they are often used together and interchangeably in civil litigation leading to confusion between the both. It is significant to note that in both these cases money is paid to another party for making good for the loss.

When an agreement becomes enforceable by law it attains the status of a valid contract as per the Contract Act, 1872. A contract is a legal promise to perform obligations for a consideration and when a party breaks such promise, the other party may suffer losses for non-performance of the promised obligations. For such losses, compensation or damages or both can be claimed by availing the legal remedies available.

AS PER SECTION 73 OF THE CONTRACT ACT, 1872:Compensation for loss or damage caused by breach of contract - When a contract has been broken, the party who suffers such a breach is entitled to receive, from the party who has broken the contract, compensation for any loss or damage caused to him thereby, which naturally arose in the usual course of things from such breach, or which the parties knew, when they made the contract, to be likely to result from the breach of it. Such compensation is not to be given for any remote and indirect loss or damage sustained by the reason of breach.

Compensation for failure to discharge obligation resembling those created by contract - When an obligation resembling those created by contract has been incurred and has not been discharged, any person injured by the failure to discharge is entitled to receive the same compensation from the party in default, as if such person had contracted to discharge it and had broken his contract.

Therefore, the means which existed of remedying the inconvenience caused by non-performance of the contract must be taken into consideration while

estimating the loss or damage arising from the breach of contract. This section makes it clear that damages arising out of obligations resembling those drafted on the contract and that arising out of breach of contract are treated separately. Section 73(3) covers claim for the damages arising from obligations resembling those created by the contract while section 73(1) covers the damages which are recoverable due to breach of contract.

The expression compensation may include a claim for damage but compensation is more comprehensive. Damages are awarded for suffering injury while compensation stands on a higher footing. Compensation aims to place the injured party back in a position as if the injury has not taken place by way of pecuniary relief for the caused injury. Therefore, the commutation of compensation cannot be mathematically precise but will definitely be broader than that of the assessment of damages. When there is a breach of contract, if sum to be paid in case of such breach is named in the contract as the amount to be paid in case of such breach, or if the contract contains any other stipulation by way of penalty then the party complaining of such breach will be entitled, whether or not actual damage or loss is proved to have been caused thereby and to receive from the party who breached the contract a reasonable compensation not exceeding the amount so named or, as the case may be, the penalty stipulated for.

In these cases, the stipulation for penalty may be a stipulation for increased interest from the date of default. The exception to this scenario is when a person enters into a bail bond, recognizable or other instruments of the same nature, or, under the provisions of any law, or under the orders of the Central Government or of any State Government, gives any bond for performance of any public duty or any act involving public interest, he shall be liable, upon breach of any condition of any such instrument, to pay the whole sum which shall be mentioned therein.

Hence, when a person enters into a contract with government does not necessarily thereby undertake any public duty or promise to do an act involving

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public interest. The term “Compensation” as stated in the oxford dictionary signifies that which is given in recompense, an equivalent rendered. “Damages” on the other hand constitute the sum of money, claimed or adjudged to be paid in compensation for loss or injury sustained, the value estimated in money, of something lost or withheld.

Damages when simply stated are a legal remedy which is usually in the form of money, paid by the court in a civil litigation to compensate an injured party for their loss, suffering or an injury. In order to be awarded with the damages, the injured party must show that the breach of duty or some other form of negligence has occurred and caused some type of mental or physical injury. Some types of damages do more than just compensate for loss or injury which is the primary distinction between compensation and damages.

It does not make much difference as far as assessment of damages is concerned, whether default is treated as breach of contract between two contracting parties or neglect of duty by agents in failing to carry out the instructions of their principal, Although the Indian Contract Act makes separate provisions for the consequences in each case, the rule laid down as to the measure of damage is the same, namely the party in breach must make the compensation in respect of direct consequences flowing from the breach and not in respect of the loss or damage remotely or indirectly caused. This is also an admitted rule followed as per English common law which is based on board principle of restitutio in integrum which means, the party who has suffered the loss should be placed in a similar position, as far as compensation in money can do it, as if the party in breach had performed his contract or fulfilled his duty. This principle can be observed in British Columbia Saw Mill Co. v. Nettleship1, “Where a man was going to be married to an heiress, his horse having cast a shoe on the journey, employed a blacksmith who did the work so unskillfully that the horse was lamed and the rider not having arrived in time the lady married another; and the blacksmith was held liable for the loss of the marriage.” And the learned judge warned “We should inevitably fall into a similar absurdity unless we applied the rules of common sense to restrict the extent of liability for breach of contract of this sort.”

1 L.R.3 C.P.499,588

The common sense point of view was thus put by Lord Wright in Liesbosh, Dredger v. Edison s. S.S. owners2. “The law cannot take account of everything that follows a wrongful act; it regards some subsequent matters as outside the scope of its selection `it were infinite for the law to judge the causes, ‘or consequence of consequences. Thus, the loss could be recovered from the wrongdoer. In the varied web or affairs, the law must abstract some consequence as relevant, not perhaps on ground of pure logic but simply for practical reasons.” These considerations have led the Court to evolve the qualifying rules of remoteness subject to which alone the broad principles of restitutio and integrum now finds its application.

THE EFFECT OF NAMING A SUM IN THE CONTRACT WITH REGARD TO THE PROVISION OF SECTION 74 OF THE INDIAN CONTRACT ACT, 1987In the case of Mahadeo Prasad v. Siemen Ltd3, the question arose as to what was the effect of naming a sum in the contract with regard to the provision of section 74 of the Indian Contract Act. It appears that the point gave the learned judge considerable trouble in arriving at the decision especially in view of observations of the Privy Council in the aforesaid case reported in AIR 1929 PC 179 Bhai Panna Singh v. Bhai Arjun Singh4. Ameer Ali J. explained the judgment delivered by the Judicial Committee by observing that the judicial committee did not mean that the sum named in the contract was not be given effect at all. What the judicial committee meant was that the plaintiff “must prove his damages”. Ameer Ali, J. observed: “But is not the figure named some proof? It is not to be conclusive proof, but is it is not some proof? It is not the estimate made by the parties with full consideration of some evidence? I think it is. “According to the learned judge “..... in English Law the sum named, if a penalty, ceases to have any effect at all either as a lower or upper limit. In Indian law it remains an upper limit or maximum.” The learned judge also observed “To my mind, the following is the intention of the legislature: (1) the plaintiff must prove his damage in a general sense; (2) The contract made by the parties estimating their damages is in itself evidence; (3) if there is no other evidence of damage, I can conceive of other cases where

2 [1993] A.C. 449

3 AIR 1934 Cal 285

4 MANU/PR/0072/1929


1 7

this evidence alone will be considered sufficient, nor do I think that the Judicial Committee intended by anything said in MANU/WB/0274/1993 to exclude such a possibility; (4) The sum named however is not conclusive evidence, that is to say, if there is no other evidence or circumstance showing that it was excessive, the court will not consider itself bound by it; (5) If, on the other hand, the other evidence and circumstances indicate that the damage equals may equal or is likely to exceed the amount named, the court will abide by it, and lastly, (6) In case of (4), that is to say where the other evidence shows that it is unreasonable, the plaintiff will have to prove his damage irrespective of the figure.”

PRECEDENTS THAT THROW LIGHT ON THE DIFFERENCEThe Supreme Court has considered the scope and applicability of section 74 of the Indian Contract Act in Fate Chand v. Balkishan5 and has distinguished the Indian Law from the English Law between stipulations for liquidated damages and penalty and observed that the distinction made in English Law between stipulations for liquidated damages and penalty have been eliminated by the provisions of section 74 of the Indian Contract Act. It is observed that the measures of damages in case of breach of a stipulation by way of penalty is, by section 74, reasonable compensation not exceeding the penalty stipulated for. The Supreme Court observed , ‘’...in assessing damages, the court has, subject to the limit of the penalty stipulated, jurisdiction of the court to award compensation in case of breach of contract is qualified except as to maximum stipulation; but compensation has to be reasonable and that imposes upon the court duty to award compensation according to settled principles. This section undoubtedly says that the aggrieved party is entitled to receive compensation from the party who has broken the contract whether or not actual damage or loss is proven to have been caused by the breach. Thereby, it merely dispenses with proof of actual loss or damage; it does not justify the award of compensation for breach of contract can be awarded to make good the loss or damage which naturally arose in the usual course of things, or which the parties knew when they made the contract, to be likely result from the beach.’’ In Union of India v. Raman Iron Foundry6, the Supreme Court observed while construing section 74 ‘’...even if there is a stipulation by way of liquidated damages, a party complaining of breach of contract can

5 MANU/SC/0258/1963

6 MANU/SC/0005/1974

recover only reasonable compensation for the injury sustained by him, the stipulated amount being merely outside limit.’’

CONCLUSION Hence, considering the above aspects, compensation and damages even though being used simultaneously and interchangeably, hold dissimilarities. Damages are usually monetary awards and commonly observed in cases of accidents to compensate for the losses suffered by them whether physical, financial or emotional. Damages are not always compensatory in nature. Also, it is sometimes considered that damages are awarded to deter someone from the same crime again. In contempt of court cases, damages are charged and these kinds of damages are not compensatory in nature. While, compensation is a legal right of all those who have been wronged or suffered losses because of guilt or lapse of another person whether it is an injury suffered from an accident or some kind of damage to the skin or other part of body by any treatment undergone at the salon. Individuals who suffer injuries received in road injuries receive compensation from not just their insurance companies but also from the party that has been found guilty of rash driving. Compensation shall be fixed on well-known principles that are applicable to the law of contract, which are to be found inter alia in section 73 of the Contract Act. Therefore, before ascertaining the quantum of both these claims a practice of considering the differentiation between both these claims on the basis of facts in hand is essential to reach a justified conclusion.

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E-EVIDENCE IN INDIA - CROSS-EXAMINATION THROUGH VIDEO CONFERENCING

PRIYANKA GODARA

INTRODUCTIONEvidence, according to Section 3 of the Indian Evidence Act, 1872, includes:

Oral Evidence: All statements which the court permits or requires to be made before it, by witnesses, in relation to fact under enquiry.

Documentary Evidence: All documents including electronic records produced for the inspection of the court.

Electronic record is a documentary evidence under section 3 of the Evidence Act and any information contained in an electronic record is deemed to be a document. An electronic record may be computer printout, Compact Disc (CD), Video Compact Disc (VCD), Pen Drive etc or in other words, it may be stored, recorded, copied in media produced by the computer or may be printed on a paper.

Documentary Evidence can further be classified into primary and secondary evidence:

Primary Evidence: According to Section 62 of the Indian Evidence Act 1872, primary evidence is the document itself produced for the inspection of the court.

Where the document is executed in several parts, each part is primary evidence of the document. Where a document is executed in counterpart, each counterpart being executed by one or some of the parties only, each counterpart is primary evidence as against the parties executing it (for those who have not executed it, it is treated as secondary evidence for them).

Where a number of documents are all made by one uniform process, as in the case of printing, lithography or photography, each is primary evidence of the contents of the rest; but, where they are all copies of a common original, they are not primary evidence of the contents of the original.

Secondary Evidence: According to Section 63 of the Indian Evidence Act 1872, secondary evidence includes certified copies issued by the authorized representative consistent with law; copies made from original document by mechanical process which insure the accuracy of the copy and all the copies compared with such copies; copies made from or compared with the original; counter parts of documents as against the parties who did not execute them; oral accounts of the contents of a document given by some person who has himself seen it.

Electronic Evidence: As a part of documentary evidence, electronic evidence was included as Section 65(A) & 65(B) through an amendment in Indian Evidence Act 1872. Therefore, electronic evidence is a form of documentary evidence in electronic form. Hard Discs, SD cards, memory cards etc where electronic information or pictures or audio or video are directly saved are primary evidence, however, CDs or any other copies made from them in any other manner are secondary evidence.

VIDEO CONFERENCE GUIDELINES ISSUED BY THE HIGH COURT OF DELHI

1. Video conferencing facilities provide Delhi Courts with the ability to receive evidence and submissions from witnesses or persons involved in Court proceedings in an affair where it would be expensive, cumbersome or otherwise undesirable for a person to attend a court in person. However, it is at the discretion of the court to decide whether evidence should be recorded by video-conferencing or not.

2. Video conference facilities enabling audio and visual communication between persons at different locations are installed at different places including High Court of Delhi, all District Courts in Delhi, Prisons in Delhi.


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3. “Court point” means the courtroom or other places where the court is sitting to record the evidence by video conference and the “remote point” is the place where the person to be examined via video conference is located. Moreover, person to be examined includes a person whose statement is required to be recorded or in whose presence proceedings are to be recorded.

4. The proceedings by way of video conference shall be conducted as judicial proceedings and the same protocol will be followed, where ever possible. All relevant statutory provisions such as Information Technology Act, 2000, and the Indian Evidence Act, 1872, shall apply to the recording of evidence by video conference.

5. The facility of video conference can be used in all matters including remands, bail applications and in civil and criminal trials in case where a witness is located intrastate, interstate or overseas. These guidelines will not apply to Section 164 of CrPC.

6. Appearance by video conferencing: The court may either suo moto or on application of a party or a witness, direct by a reasoned order that any person shall appear before it or make submissions to the court through video conferencing.

7. Preparatory arrangements for video conference: Coordinators are appointed at the court point as well as the remote point; in High Court, the Registrar (Computers) shall be the coordinator at the court point; in District Courts, Official-in-charge of Video-Conferencing Facility is nominated by the District Judge who shall be the coordinator at the court point.

8. Coordinators at the remote point are also appointed by the court. In case, where the person is examined overseas, the court may appoint the official of the Consulate/Embassy of India or duly recognised Notary Public/Oath Commissioner as the coordinator. In case, where the person to be examined is in another state or U.T, a Judicial Magistrate or any other official may be deputed by the District Judge to act as a coordinator. In case, where the person to be examined is in

custody, the concerned Jail Superintendent or any other official deputed by the court shall be the coordinator. In case, where the person to be examined is in any public or private hospital, the Medical Superintendent or any other official person deputed by the court shall act as a coordinator. In case where the person to be examined is a juvenile, the Superintendent or any other official deputed by the court shall act as the coordinator.

9. The coordinator at the remote point shall ensure that the person to examined is available at least 30 minutes before the scheduled time, also no other recording device is permitted except the one installed in the room and entry in the video conference room is also regulated.

10. The coordinator taking the orders of the court at the remote point shall provide a translator, an expert in sign language, an expert for reading documents in case where the person is visually challenged, an interpreter or special educator, as the case maybe.

11. A set of plaint, written statements and all the necessary documents must be sent in advance to all the non-party witnesses to make them acknowledge with the matter concerned. Further, the witness has to file an affidavit duly verified by notary or judge, that the person is shown as witness and person deposing before the court is the same person. Moreover, even the person who wishes to examine any witness on screen shall file an affidavit.

12. Minimum requirements for video conference: A desktop or laptop with internet connectivity and printer, device ensuring uninterrupted power supply, video camera, microphones and speakers, display unit, document visualizer, comfortable sitting arrangements ensuring privacy, adequate lightening and insulations, digital signatures from licensed certifying authorities for the coordinators at the court point and the remote point.

13. All the expenses of recording the evidence through video conferencing will be borne by the

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applicant, who wants to avail this facility of video conferencing.

14. General Procedure: The identity of the person to be examined shall be confirmed by the court with the help of the coordinator at the remote point. It is the duty of the officer deputed by the court to fix the time for recording evidence. Moreover, witness will only be examined during the working hours of Indian courts.

15. Depositions of the witness will form part of the record of proceedings after they are signed. They must be signed as soon as possible before a Magistrate or Notary Public. In this process, even digital signatures can be used and such signatures shall be obtained immediately after the day’s evidence.

EVIDENCE CAN BE RECORDED THROUGH VIDEO CONFERENCINGThere are numerous guidelines given by the Supreme Court of India and various High Courts, time to time about recording of evidence through video conferencing. The law which would be applicable to recording of evidence through video conferencing will be the same as applicable to recording of evidence in courts normally, including section 272-283 of Code of Criminal Procedure and Order 16 & 18 of Civil Procedure Code.

Cr.P.C amendment of 2009, added a proviso to subsection (1) of 275 Cr.P.C which says, “provided that evidence of a witness under this subsection may also be recorded by audio-video electronic means in the presence of the advocate of the person accused of the offence”, after analyzing the proviso, it can be said that taking evidence of a witness through video conferencing is permissible.

In case of State of Maharashtra Vs Dr. Prafull Desai and Anr1 the apex court interpreted the meaning of the term “presence of the accused” as per Section 273 Cr.P.C, which means that the accused may not be physically present , evidence may also be taken in the presence of the pleader of accused. The Supreme Court

1 2003 4 SCC 601

also permitted recording of evidence of witnesses staying abroad through video conferencing.

In case of Twentieth Century Fox Film Corporation Vs NRI Film Production Associates Ltd.2 the Hon’ble High Court of Karnataka observed that “before a witness is examined in terms of the Audio-Video Link, witness is to file an affidavit or an undertaking duly verified before a notary or Judge that the person who is shown as the witness is the same person who is going to dispose on the screen”. A copy is to be made available to the other side. The Judge also observed that Order 18, Rule 3(4) (3) provides for recording evidence either by writing or mechanically in the presence of a judge.

In case of Santhini Vs Vijaya Venketesh3 the Supreme Court held that in matrimonial cases, evidence via video conference is not permissible. Both the parties have to be present in court to have a possibility of an emotional bond. The absence of either of the party can create a dent in the process of settlement. Supreme Court further observed that Family Court judge should never be a slave to the concept of speedy trial. It is important for both the parties to be present at the same place and the same time for reconciliation. If, this is permitted then it can defeat the purpose of the whole act.

CROSS-EXAMINATION THROUGH VIDEO CONFERENCEIn case of State of Maharashtra Vs Dr. Prafull Desai and Anr4 the apex court interpreted Section 273 of Cr.P.C in the light of technological advancements. Bench comprising of Justice S.N Variava and Justice B.N Agrawal observed that recording of evidence through video conferencing is absolutely legal. Justice Variava further added that “In cases where the attendance of a witness cannot be procured without an amount of delay, expense or inconvenience, the court could consider issuing a commission to record evidence by way of video conferencing”. The Supreme Court further observed that the cross-examination can be done in the presence of Presiding Officer of the Court or get it recorded by a Commissioner appointed by the court after the documents are filed in Court along with the affidavit and after the relevancy and admissibility of such documents are determined by the court. However,

2 AIR 2003 Kant 148, 2003 (5) KarLJ 98

3 (2018) 1 SCC 1

4 Supra note 1


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examination-in-chief and cross-examination must relate to relevant facts. The object of cross-examination is to impeach the accuracy, credibility and general value of the evidence given in chief, shift the facts already stated by the witnesses, to detect and expose any discrepancies, to elicit suppressed facts which will support the cross-examining party.

The cross-examiner should be asked to repeat the question, if the witness is unable to understand. Ordinary witness should not be asked regarding legal provisions. Moreover, while recording omissions and contradictions, the presiding officer must verify the previous statement. Further, unless the documents are properly filed on record, they should not be permitted to refer in cross-examination. If a document is duly proved mechanically or otherwise is not exhibited, still it can be read in evidence.

CONCLUSIONIn modern times, there is a great need to make statutory changes to develop a better approach towards civil and criminal trials and to lessen the burden on investigators and judges. Justice Variava has rightly observed in his judgement that where the attendance of a witness cannot be procured without inordinate delay, expense or inconvenience, the court could consider issuing of commission to record evidence by way of video conferencing. Normally a commission would involve recording of evidence at the place where the witness is. However, advancement in science and technology has now made it possible to record such evidence by way of video conferencing in the town/city where the court is. Recording of evidence through video conferencing will fasten up the disposal of matters, also it will become easier for the public servants like doctors, mechanical experts etc. to give their evidence before the court without creating any hindrance to public services. More changes in the legislations are needed to develop a better problem-solving approach to civil and criminal trials and to reduce the work load of the courts.

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PROMOTION OF EASE OF DOING BUSINESS BY LEGISLATURE VIA INTRODUCTION OF THE COMPANIES (AMENDMENT) BILL, 2020

SANDESH KUMAR P

The Ministry of Corporate Affairs, vide its order dated September 18, 20191, constituted the Company Law committee with the object to amend the existing Companies Act 2013, to Promote Ease of Doing Business to law abiding corporates, fostering improved corporate compliance for stakeholders at large and also to address emerging issues having impact on the working of corporates in the country. As per the World Bank’s Report for 2020, India is currently in 63rd position2 for ease of doing business.

Based on the report of the Company Law committee dated November 14, 20193, the Companies (Amendment) Bill, 2020, was introduced in the lower house of the Parliament on March 17, 2020, by the Minister of State for Finance and Corporate Affairs - Shri Anurag Singh Thakur to further amend the Companies Act, 2013, with the sole object of Promoting Ease of Doing Business4.

KEY FEATURES OF THE ABOVE-MENTIONED BILL 1. To decriminalize the minor procedural, technical

and minor non-compliances under the Act which lack any element of fraud or which do not involve larger public interest and which can be dealt through civil jurisdiction instead of criminal.

2. To exclude certain class of companies from the definition of “listed company” under Section 2(52) of the Companies Act 2013, in consultation with the Securities and Exchange Board of India (SEBI) in order to facilitate listing of their debt securities.

3. To clarify the jurisdiction of trial court on the basis of place of commission of offence for wrongful

1 http://www.mca.gov.in/Ministry/pdf/ConstitutionCLC_18092019.pdf

2 http://documents.worldbank.org/curated/en/688761571934946384/pdf/Doing-Business-2020-Comparing-Business-Regulation-in-190-Economies.pdf

3 http://www.mca.gov.in/Ministry/pdf/ReportCLRC_14082019.pdf

4 http://loksabhaph.nic.in/Debates/Synopsis.aspx

withholding of property of a company by its officers or employees under the section 452 of the Act.

4. To insert a new chapter to include certain provisions relating to the regulation of the Producer Companies, which was earlier part of the Companies Act, 1956, such as provisions relating to membership, conduct of meetings and maintenance of accounts of the Producer Companies.

5. To establish additional special benches of the National Company Law Appellate Tribunal in places other than New Delhi, due to the heterogeneity of matters that are dealt by the NCLAT and as it exercises the appellate powers under three key economic legislations such as the Competition Act, 2002, the Insolvency and Bankruptcy Code, 2016, and the Companies Act, 2013.

6. To make provisions for Allowing Payment of Remuneration to Non-Executive Directors in case of Inadequacy of Profits, by aligning the same with the provisions for remuneration to executive directors. Non-executive directors, including independent directors who devote their valuable time and have experience to give critical advice to the company must be appropriately compensated for the same even in case of inadequacy of profits or losses as is permissible for executive directors.

7. Relaxation of provisions relating to charging of higher additional fees for default on two or more occasions in submitting, filing, registering or recording any document, fact or information as provided in section 403.

8. To extend the applicability of section 446B, relating to lesser penalties for small companies and one person companies, to extend the same benefit to the Producer Companies and start-ups.

9. To exempt certain class of persons from complying with the requirements of section 89 relating to


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declaration of beneficial interest in shares and exempt any class of foreign companies or companies incorporated outside India from the provisions of Chapter XXII relating to companies incorporated outside India.

10. To amend the Section 62(1) with reference to Reduction of Timelines for Speeding up the Rights Issue by providing shorter period of time than the mandatory 15 days’ time period provided in this provision.

11. Extending exemptions for filing of certain resolutions under Section 117 to certain classes of non-banking financial companies and housing finance companies in consultation with the RBI. As NBFCs now engage in lending activities in their regular course of business, similar to the manner in which banks engage in such activities and since such lending takes place in their ordinary course of business, filing resolutions for all lending related matters may be burdensome and also affects their confidentiality.

12. Companies which have Corporate Social Responsibility liability up to fifty lakh rupees shall not be required to constitute the Corporate Social Responsibility Committee and to allow eligible companies to set off any amount spent in excess of their Corporate Social Responsibility Liability in a particular financial year towards such obligation in subsequent financial years

13. To provide for a window within which penalties shall not be levied for delay in filing annual returns and financial statements in certain cases.

14. To require certain class of unlisted public companies to prepare and file their periodical financial results.

15. To allow certain class of public companies to directly list certain class of securities on stock exchanges in permissible foreign jurisdictions.

***

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ADVENT OF ONLINE INTERMEDIARIES & THEIR UNDER REGULATION THE INDIAN LAW

RISHAB KHARE

ANJANI WADHWA

INTRODUCTIONAccording to the Organization for Economic Co-operation and Development, online intermediaries can be defined as companies or organizations which “bring together or facilitate transactions between third parties on the internet. They give access to, host, transmit and index content, products and services originated by third parties on the internet or provide internet-based services to third parties.”1

The intermediary ecosystem in India is in a Stage of Evolution. The major players in India that engage in online intermediary system are familiar global giants given the fact that the internet access is concentrated in urban areas and among people who are familiar with the digital technology.

However, the expansion of global connectivity via internet gives rise to three major concerns that are - to counter terrorism, counter hate speech and ensure protection to minors.

The role of online intermediaries can never be undervalued. They have come a long way in providing employment and entrepreneurship opportunities to people by lowering physical and social barriers. By facilitating exchange of ideas, they have become an advocate of free speech like no one else.

It is pertinent to mention that most of the intermediaries have explicit code of conduct and internal policies to counter possible illegal activities. However, it has been found that these policies are insufficient to deal with the issues. These regulations vis-à-vis internal policies are supplemented by various rules and provisions enacted by the government. Also, in most jurisdictions, there is a liability clause to ensure the compliance to community standards by these intermediaries.

1 The Economic and Social Role Of Internet Intermediaries, accessed at <https://www.oecd.org/internet/ieconomy/44949023.pdf >

ROLE OF ONLINE INTERMEDIARIESVarious roles played by the intermediaries are:2

a. Develop and maintain infrastructure

b. Collect and dissimilate information that has been gathered

c. Facilitation of communication and exchange of information

d. Improve market processes

e. To maintain an account of requirements of consumers

However, there are a variety of problems which the intermediary might have to face while carrying out its role. For example, in an effort to provide personalized services to its clients, the intermediary has to keep in mind that it does not cross the line of infringement of Right to Privacy of its consumers and to provide protection to their personal data.

EVOLVING RESPONSIBILITIES OF ONLINE INTERMEDIARIESIntermediaries are generally not made responsible for the conduct of third party as far as the issue of copyright infringement is concerned. However, there is an exception to this principle. Intermediary shall attract liability in a case where it had knowledge or control over the content that was a result of copyright infringement.

2 Value creation and new intermediaries on Internet. An exploratory analysis of the online news industry and the web content aggregators (2007), Ana Rosa del Águila-Obraa, Antonio Padilla-Meléndeza, and Christian Serarols-Tarrésb, based on Anderson & Anderson, 2002; Grover & Teng, 2001; Sarkar, Butler & Steinfield, 1998.


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New issues that have arisen with respect to the role of online intermediaries are:

1. New kinds of intermediaries whose role has increased in recent times such as social networks require a distinct safe harbours for themselves

2. Safeguards need to be put in place to ensure protection of fundamental rights of individuals such as freedom of speech, right to privacy, protection to life etc.

3. There is a need to address complex issues with assent of all the stakeholders involved.

4. With the global distribution of data and other information, it has become imperative that global rules vis-à-vis liability are periodically reviewed to add strength to them.

EXECUTIVE AND LEGAL FRAMEWORK VIS-À-VIS ONLINE INTERMEDIARIES IN INDIAIt is imperative to mention that the Indian law has left no stone unturned to match the pace of the vastly growing cyberspace in India. The online intermediaries have been subjected to both civil liability and criminal liability through various regulations and provisions. The significant legislations which regulate the role of intermediaries in India are the Information Technology Act, 2000 and the Copyright Act of 1957. The other ancillary legislations that may be applicable are Indian Penal Code of 1860, Law of Torts, Protection of Children from Sexual Offences Act, 2012 and Scheduled Caste and Scheduled Tribe (Prevention of Atrocities) Act, 1989.

The major problem in the lack of control over online intermediaries is that they cannot be subjected to domestic regulations due to their transnational nature. The other associated problem is that these online intermediaries are outside the physical control of the government as they are connected to wide public domain. The Internet Service Providers are subjected to the licensing system of India. However, this is not the case with the online intermediaries.

ROLE OF INFORMATION TECHNOLOGY ACT, 2000One of the main purposes of the enforcement of this Act was to give legitimacy to e-commerce. The other purpose was to give effect to the United Nations Commission on International Trade Laws’ Model Law on E-commerce3.

It is pertinent to mention that the IT Act was amended in 2008, to broaden the scope of liability of the intermediaries. The intermediary loses protection of the Act if4:

1. It initiates the transmission,

2. selects the receiver of the transmission, and

3. selects or modifies the information.

For instance, an intermediary might automatically inject advertisements in all transmissions, but that modification does not go to the heart of the transmission, or make it responsible for the transmission in any way. Similarly, the intermediary may have a code of conduct, and may regulate transmissions with regard to explicit language (which is easy to judge) but would not have the capability to make judgments regarding fair use of copyrighted materials.

Further, the government has the power to block the access to any website or public access of any information through any computer resource u/s 69A of Information Technology Act, 2000. This section mandates the intermediaries to assist the government to intercept, monitor and encrypt information stored in computer or computer sources. If the intermediaries fail to comply with this provision, they can be imprisoned for a period up to seven years.

Interception orders are communicated by the nodal officer who authenticates the same and conveys the same to the designated person within the intermediary.Under Regulation 23(2) of the Information Technology (Procedures and Safeguards for Interception, Monitoring and Decryption of Information) Rules, 2009, the intermediaries are required to burn the

3 G.A. Res. 51/162, Model Law on Electronic Commerce, U.N. Doc. A/RES/51/162 (Jan. 30, 1997).

4 https://cis-india.org/internet-governance/publications/it-act/short-note-on-amendment-act-2008

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records within two months of discontinuance of monitoring unless they are required for the purposes of ongoing investigation.

ROLE OF COPYRIGHT ACT OF 1957Under the Act, the safeguards provided to the intermediaries are subjected to Section 8 of the same legislation. According to section 81, no person shall be barred from exercising his right under the Copyright Act of 1957.

A safe harbor has been provided under Section 52 of the Act which states that “transient or incidental storage of a work or performance purely in the technical process of electronic transmission or communication to the public”5 shall not amount to copyright infringement under the Act.

Also, incidental storing of data in order to provide online access shall also not constitute copyright infringement unless the intermediary has reasonable grounds to believe that such storage is a result of copyright infringement.

In Super Cassettes Industries Ltd v. Myspace Inc,6, the court held that the presence of algorithm-generated advertisements is an indication of knowledge of infringement.

Copyright Act makes the immunity granted to the intermediaries, conditional. Section 52(1)( c ) requires the intermediary to freeze access to a material if a complaint has been made alleging it to be a result of copyright infringement. However, this access may be restored after a period of twenty-one days unless a court order has been received making directions to the contrary.

Thereby, it is pertinent to mention that the legal framework which governs functioning of intermediaries in India has to be in compliance with the provisions of the Constitution of India, 1950. The rules, regulations and the restrictions should clearly respect the freedom of speech enshrined under Article 19 of the Constitution of India.

5 Section 52 of Copyright Act of 1957

6 M.I.P.R. 2011 (2) 303 (India

CONCLUSIONIn today’s time, the internet commerce heavily relies upon online intermediaries. Thus, it has become imperative that a strict watch is kept on the inflow and outflow of information through these intermediaries. Online intermediaries allow the consumers to act both as seller and the buyer. This has enabled the consumers to have an alternate source of income.

Distance between online sellers and the buyers has reduced significantly as the online intermediaries make available tremendous amount of information to the consumers from which they can pick their convenient options. Online intermediaries have led to a world that is full of transparency, product variety and time efficiency and play a key role in enhancing democratic goals such as exchange of thoughts and promoting the cause of freedom of speech. The online intermediaries have started to affect day-to-day lifestyles of a common man by creating vast employment opportunities thereby contributing to and boosting the economy.

***


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TIME LIMITATION FOR THE OPPOSITE PARTY FOR FILING RESPONSE TO THE COMPLAINT : AN ANALYSIS OF NEW INDIA ASSURANCE CO. LTD. V. HILLI MULTIPURPOSE COLD STORAGE PVT. LTD. (CIVIL APPEAL NO.10941 10942 OF 2013)

PRATEEK DHIR

The Hon’ble Constitution Bench, of the Apex Court comprising of Hon’ble Justice Arun Mishra, Justice Indira Banerjee, Justice Vineet Saran, Justice M. R. Shah and Justice S. Ravindra Bhat, vide Judgment dated 4th March, 2020, disposed-off Civil Appeal No.10941 10942 of 2013, New India Assurance Co. Ltd. Vs. Hilli Multipurpose Cold Storage Pvt. Ltd., along with other connected civil appeals, and clarified that the consumer courts cannot grant time to the Opposite Party to file a reply beyond a total period of 45 days, as mandated under Section 13(2)(a) of the Consumer Protection Act, 1986 (hereinafter referred to as ‘the Act’).

The Constitution Bench vide instant judgment addressed, discussed and settled the following two questions:

a) Whether the District Forum has the power to extend the time for filing the response beyond the period of 15 days, in addition to 30 days as mandated by Section 13(2)(a) of the Act?

b) What would be the commencing point of limitation of 30 days stipulated under Section 13 of the Act?

1. OBJECT OF THE ACTThe Hon’ble Supreme Court contended that the main motive of the Act is to provide expeditious disposal of the consumer disputes and that it is for the protection and benefit of the consumer. The statement of objects and reasons, states that the act is to provide speedy and simple redressal to consumer disputes. Further, the preamble of the Consumer Protection Act also mentions that the Act is to provide for better protection of the consumer interest.

2. THE HON’BLE BENCH WHILE HIGHLIGHTING THE EMPHASIS ON SPEEDY DISPOSAL OF THE CONSUMER DISPUTES, HIGHLIGHTED THE FOLLOWING PROVISIONS i) Sub section 2(b)(ii) of Section 13 of the Act

provides that where no response is filed by the opposite party, the complaint may be decided ex-parte on the basis of evidence brought forth by the complainant.

ii) Sub Section 2(c) of Section 13 of the Consumer Protection Act further provides that where the complainant fails to appear on the date of hearing before the District Forum, the District Forum may either dismiss the complaint for default or decide it on merits.

iii) (3A) of Section 13 of the Consumer Protection Act, which was inserted by Act 62 of 2002, also provides for deciding every complaint as expeditiously as possible and endeavour shall be made to decide the complaint within a period of three months from the receipt of notice by the opposite party, and within five months, if the complaint requires analysis or testing of commodities.

iv) Sub section (3) of Section 13 of the Consumer Protection Act, which clearly provides that “No proceedings complying with the procedure laid down in the subsection (1) and (2) shall be called in question in any court on the ground that the principles of natural justice have not been complied with”. The intention of the legislature thus, is clear that mere denial of further extension of time for filing the response (by the opposite party) would not amount to denial or violation of the principles of natural justice.

v) Regulation 10 of the Consumer Protection Regulations, 2005, clearly provides that, ordinarily,

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notice to the opposite party to file its response shall be issued for a period of 30 days, but the same can be even less than 30 days, depending upon the circumstances of each case.

3. JUDICIAL INTERPRETATIONS RELIED UPON BY THE HON’BLE BENCH FOR COMPUTING LIMITATION PERIOD, WHEREVER IT IS SPECIFICALLY PROVIDED BY THE STATUTORY PROVISIONS

i) Lachmi Narain v. Union of India1, wherein the Hon’ble Supreme Court has held that, “if the provision is couched in prohibitive or negative language, it can rarely be directory, the use of peremptory language in a negative form is per se indicative of the interest that the provision is to be mandatory”.

ii) Bhikraj Jaipurai v. Union of India2, wherein the Hon’ble Supreme Court has held that “It may be said that the view that the provisions in the Constitution relating to the form of contracts on behalf of the Government are mandatory may involve hardship to the unwary. But a person who seeks to contract with the Government must be deemed to be fully aware of statutory requirements as to the form in which the contract is to be made”.

iii) In Rohitash Kumar v. Om Prakash Sharma3, the Apex Court has held that, “There may be a statutory provision, which causes great hardship or inconvenience to either the party concerned, or to an individual, but the Court has no choice but to enforce it in full rigor. It is a well settled principle of interpretation that hardship or inconvenience caused, cannot be used as a basis to alter the meaning of the language employed by the legislature, if such meaning is clear upon a bare perusal of the statute. If the language is plain and hence, allows only one meaning, the same has to be given effect to, even if it causes hardship or possible injustice”.

iv) In Popat Bahiru Govardhane v. Special Land

1 (1976) 2 SCC 953

2 AIR 1962 SC 113

3 (2013) 11 SCC 451

Acquisition Officer4, The Apex Court has held that, “It is a settled legal proposition that law of limitation may harshly affect a particular party but it has to be applied with all its rigour when the statute so prescribes. The Court has no power to extend the period of limitation on equitable grounds. The statutory provision may cause hardship or inconvenience to a particular party, but the court has no choice but to enforce it”.

4. THE HON’BLE BENCH WHILE CONSIDERING THE ASPECTS OF LAW AND EQUITY, REFERRED TO THE FOLLOWING JUDGMENTS AND ASSERTIVELY REITERATED THE SETTLED LAW, THAT LAW SHALL ALWAYS PREVAIL OVER EQUITY

a) Laxminarayan R. Bhattad vs State of Maharashtra5, wherein the Hon’ble Supreme Court has observed that “When there is a conflict between law and equity the former shall prevail”.

b) P.M. Latha vs State of Kerala6, wherein the Hon’ble Supreme Court has observed that “This Court held that Equity and law are twin brothers and law should be applied and interpreted equitably, but equity cannot override written or settled law”.

c) In Nasiruddin vs Sita Ram Agarwal7, wherein the Hon’ble Supreme Court has held that, “In a case where the statutory provision is plain and unambiguous, the court shall not interpret the same in a different manner, only because of harsh consequences arising therefrom.”

d) In E. Palanisamy vs Palanisamy8, wherein the Hon’ble Supreme Court has held that “Equitable considerations have no place where the statute contained express provisions”.

e) India House vs Kishan N. Lalwani9, wherein the

4 (2013) 10 SCC 765

5 (2003) 5 SCC 413

6 (2003) 3 SCC 541

7 (2003) 2 SCC 577

8 (2003) 1 SCC 123

9 (2003) 9 SCC 393


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Hon’ble Supreme Court has held that “The period of limitation statutorily prescribed has to be strictly adhered to and cannot be relaxed or departed from by equitable considerations”.

5. POSITION OF LAW UNDER VARIOUS STATUTES FOR NON-FILING OF RESPONSE BY THE OPPOSITE PARTY/RESPONDENT WITHIN THE LIMITATION PERIOD, WHERE THE STATUTORY LIMITATION PERIOD IS SPECIFICALLY PROVIDEDa) Civil Procedure Code, 1908

i) The language of 13(2) of the Act is not pari materia to Order VIII Rule 1 of the Civil Procedure Code, 1908 (hereinafter referred to as “the Code”). The Hon’ble Bench stressed upon regulation 26 of the Consumer Protection Regulations, 2005, which clearly mandates that endeavor is to be made to avoid the use of the provisions of the Code except for such provisions, which have been referred to in the Consumer Protection Act and the Regulations framed thereunder, which is provided for in respect of specific matters enumerated in Section 13(4) of the Consumer Protection Act.

ii) The Hon’ble Bench also noted that the Order VIII Rule 1 read with Order VIII Rule 10 of the code, prescribes that the maximum period of 120 days provided under Order VIII Rule is actually not meant to be mandatory, but only directory. Whereas, sub section (2)(b)(ii) of Section 13 of the Consumer Protection Act clearly provides for the consequence of the complaint to be proceeded ex parte against the opposite party, if the opposite party omits or fails to represent his case within the time given.

b) Commercial Courts Act, 2015

The Hon’ble Bench also emphasized that under Order VIII Rule 10 of the Code, for suits filed under the Commercial Courts Act, 2015, a proviso has been introduced for commercial disputes of a specified value, which reads as, “Provided further that no Court shall make an Order to extend the time provided under Rule 1 of this Order for filing the written statement”. Thus, for commercial

suits, time for filing written statement provided under Order VIII Rule 1 is meant to be mandatory, not directory. The Hon’ble Bench relied upon SCG Contracts (India) Private Limited vs K.S. Chamankar Infrastructure Private Limited10, wherein the Hon’ble Supreme Court has held that, “…. the clear, definite and mandatory provisions of Order V read with Order VIII Rule 1 and 10 cannot be circumvented by recourse to the inherent power under Section 151 to do the opposite of what is stated therein”. It was, thus, clarified that there was no scope for extending the time for filing of written statement beyond the period of 120 days in commercial suits, as the provision with regard to such suits would be mandatory, and not directory.

c) Special Court (Trial of Offences Relating to Transactions in Securities) Act, 1992 The Hon’ble Supreme Court, in the matter of Fairgrowth Investments Ltd. Vs Custodian11, while dealing with the provisions of the Special Court (Trial of Offences Relating to Transactions in Securities) Act, 1992, held that the Special Court has no power to condone the delay in filing the petition under Section 4(2) of the said Act. The Apex Court observed, “It is not for the courts to determine whether the period of 30 days is too short to take into account the various misfortunes that may be faced by notified persons who wish to file objections under Section 4(2) of the Act nor can the section be held to be directory because of such alleged inadequacy of time.”

6. CONTRARY VIEWS HELD IN PRIOR RULINGS OF THE HON’BLE SUPREME COURT IN CONTEXT OF TIME LIMITATION FOR FILING RESPONSE BY THE OPPOSITE PARTY UNDER SECTION 13 OF ACT The Apex Court, in the matter of Topline Shoes Ltd. vs. Corporation Bank12, while dealing with the provisions of Section 13(2)(a) of the Consumer Protection Act, has held that the said provision would be directory and not mandatory. The court relied on the principles of natural

10 (2019) 12 SCC 210

11 (2004) 11 SCC 472

12 (2002) 6 SCC 33

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justice, and also that no consequence of non-filing of the response to the complaint within 45 days is provided for in the Consumer Protection Act. The Hon’ble Court was also of the view that in the Act, no consequence is provided in case the time granted to file reply exceeds the total period of 45 days.

Whereas, the Hon’ble Supreme Court, in the matter of Dr. J.J. Merchant vs. Shrinath Chaturvedi13, has held that the time limit prescribed for filing the response to the complaint under the Consumer Protection Act, as provided under Section 13(2)(a), is to be strictly adhered to, i.e. the same is mandatory, and not directory. The Hon’ble Court while deciding the aforesaid matter, also considered the Statement of Objects and Reasons, salient features of the act which aimed to provide simple, inexpensive and speedy justice to the consumers.

The Hon’ble Court further considered that in Sub section (2)(b)(ii) of Section 13, the opening sentence “on the basis of evidence” has been substituted by “ex parte on the basis of evidence”. By this amendment, consequences of not filing the response to the complaint within the specified limit of 45 days was to be that the District Forum shall proceed to settle the consumer dispute ex parte on the basis of evidence brought to its notice by the complainant, where the opposite party omits or fails to take action to represent his case within time.

It was further noticed that Sub section (3A) of Section 13 was inserted, providing that the complaint should be heard as expeditiously as possible and that endeavor should be made to normally decide the complaint within 3 months, and within 5 months where analysis or testing of commodities was required. The provisos to the said Sub section required that no adjournment should be ordinarily granted and if granted, it should be for sufficient cause to be recorded in writing and on imposition of cost, and if the complaint could not be decided within the specified period, reasons for the same were to be recorded at the time of disposing of the complaint.

It was thus, under these circumstances the Apex Court held that the time limit of 30 days plus 15 days in filing the response to the complaint, be mandatorily and strictly adhered to.

13 (2002) 6 SCC 635

That after giving due consideration to the views taken by the Supreme Court in the aforesaid matters, the Court vide its judgment in the matter of NIA vs. Hilli Multipurpose Cold Storage14, agreed with the view taken in the Dr. J.J. Merchant vs. Shrinath Chaturvedi and held that, “We are, therefore, of the view that the judgment delivered in J.J. Merchant holds the field and therefore, we reiterate the view that the District Forum can grant a further period of 15 days to the opposite party for filing his version or reply and not beyond that”.

7. COMMENCING POINT OF LIMITATION FOR FILING RESPONSE BY THE OPPOSITE PARTY UNDER SECTION 13 OF THE CONSUMER PROTECTION ACT, 1986 The other question qua commencing point of limitation of 30 days stipulated under Section 13 of the Act was also determined by the Constitution Bench, i.e. whether the limitation under Section 13 of the Consumer Protection Act for filing the response by the opposite party to the complaint would commence from the date of receipt of the notice of the complaint by the opposite party, or the receipt of notice accompanied by a copy of the complaint.

The Constitution Bench in order to decide the aforesaid question, analysed that Sub sections (2)(a) and (2)(b) of Section13 of the Consumer Protection Act specify that the copy of the complaint is to be given to the opposite party directing him to give his version of the case within a period of 30 days or such extended period, not exceeding 15 days. As such, from the aforesaid provision itself, it is clear that it is the copy of the admitted complaint, which is to be served, after which the period to file the response would commence. Further the Hon’ble Bench also relied upon regulation 10(5) of the Consumer Protection Regulations, 2005, which mentions that “along with the notice, copies of the complaint, memorandum of grounds of appeal, petitions as the case may be and other documents filed shall be served upon the opposite party(ies)/respondent(s)”.

14 (2015) 16 SCC 22


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The Hon’ble bench further placed its reliance upon Nahar Enterprises vs Hyderabad Allwyn Ltd.,15 , Union of India vs Tecco Trichy Engineers & Contractors16, and emphasized that wherever limitation is provided, either for filing response/written statement or filling an appeal, it is the copy of the plaint or the order/award which is to be served on the party concerned after which alone would commence the period of limitation.

Thus, the Hon’ble Constitution Bench in the instant matter, after analyzing various provisions of Consumer Protection Act, 1986, Consumer Protection Regulations 2005, position of law for filing response by the Opposite Party/ Respondents under various statutes and due consideration to various judicial precedents, has concluded that, the District Forum has no power to extend the time for filing the response to the complaint beyond the period of 15 days in addition to 30 days as is envisaged under Section 13 of the Consumer Protection Act; and that the commencing point of limitation of 30 days under Section 13 of the Consumer Protection Act would be from the date of receipt of the notice accompanied with the complaint by the opposite party, and the judgment shall operate prospectively.

***

15 (2007) 9 SCC 466

16 (2005) 4 SCC 239

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THE EPIDEMIC ACT OF INDIA 1897: AN ANALYSIS VIS-À-VIS THE COVID-19 PANDEMIC

PUSHKRAJ S DESHPANDE

HISTORY AND NEED OF THE EPIDEMIC ACTAround September 1896, one case of Bubonic Plague was detected in Mandvi (then in Bombay Presidency) now in Gujarat. Bombay Presidency was even then one of the most densely populated areas due to rapid growth of commerce there. The plague epidemic spread rapidly due to constant inflow of population; legend has it that there were almost 1900 reported deaths per week during the spread of epidemic. India, then under the rule of Queen and British Parliament, had to act swiftly to prevent the plague from spreading to rest of India. It was then that the Epidemic Act 1897, was enacted by the British Parliament to curb in the spread of plague.

SPECIAL PROVISIONS OF THE EPIDEMIC ACT1

The Epidemic Act consists of a total four sections, which are amended time to time as and when required. The significant provisions of the Act are as under:

Section 2 of the Act provides with the special provisions for regulations to be imposed by the government at the time of any dangerous epidemic disease. This provision gives powers to the State Government if it is satisfied that any part of the state is affected by or threatened to be affected by outbreak of any dangerous epidemic disease and if the government feels that there are no measures in the ordinary provisions of law to deal with the said epidemic, the State Government may take following measures for the safeguard of the public at large which shall be temporary in nature in order to prevent the outbreak of such a disease:

a) To inspect the person travelling.

b) Segregation of people suspected of being diagnosed with the disease in hospital, or temporary accommodations or otherwise.

1 https://indiacode.nic.in/bitstream/123456789/10469/1/the_epidemic_diseases_act%2C_1897.pdf

Section 2A empowers the Central Government to inspect ships and vessels leaving or arriving in the territories of India and also empowers the government to detain such vessels if required.

Section 3 provides with the penalties for disobeying the regulations made by the government under section 2 and 2A. The punishment for such disobedience shall be the same as Section 188 of Indian Penal Code (IPC).

Section 188 of IPC provides for minimum punishment of 1 month and maximum for 6 months and/ or fine of Rs.1000/- shall be meted out to the person who is in violation of the regulations/notification of the government.

Section 4 protects the government and its employees and officers from any prosecution, civil or criminal, for doing anything in good faith.

LIMITATIONS OF THE ACT AS OF TODAYThe Act is more than 120 years old, enacted by the then British Parliament to curb a situation that arose only in one part of undivided India i.e. the Bombay Presidency. The real motive of the British Parliament behind the said act can be doubted for a simple reason that, the Act was misused by the British officers to arrest and confine public gatherings led by the freedom fighters. The object of the Epidemic Act is more for prevention of the spread of the disease not to curb or eradicate the disease which has already started to spread. The Act does not define the term epidemic or disease. The Act does not give specific measures or directions to the government to follow at the time of an epidemic. The Act simply empowers to prescribe general temporary notifications/regulations if it thinks that the epidemic cannot be controlled by the existing laws of land.

The Epidemic Act does not give any guidelines for formation of a special committee or a disaster management team which can act upon the emergency in a prescribed and precautionary manner without


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waiting for the state government to act after considering other factors of the state.

The Act does not provide measures for isolation of the suspected patients and isolation centres. There should be provisions directing the state governments to build isolation centres in all hospitals and housing societies to be used as isolation centres at the time of epidemic. The Act is silent on the part of how the vaccines and drugs can be distributed by the government. As the Act is silent on all these aspects it leaves no ground for the public at large to hold the government responsible for any kind of negligence on the part of the government in the court of law as there is no proper mechanism on which the government can act on. The provisions give the liberty to the State Government to prescribe temporary regulations which can be more of trial and error rather than being rigorous measures to control the epidemic.

THE ACT VIS-À-VIS COVID-19Many states and union territories including Maharashtra, Punjab, Gujarat, Assam, Delhi have issued notifications under the provisions of the Epidemic Act. The states even after imposing certain restrictions under this Act are struggling with the isolation of people and stemming the spread of the disease as there are no specific provisions in the Act which can guide the State Governments to act in a prescribed manner at the time of crises during the spread of epidemic. The Act is more than a century old, when the organisations like World Health Originations and United Nations were not even established. The Act lags behind in implementing the guidelines issued by these originations time and again. In India, there are several laws enacted by the Parliament on public health which are not addressed under one single enactment or law. It is the need of the hour for the legislature to amend the century old law in order to be ready for any kind of epidemic. National Health Bill 2009 is still pending to be enacted. The National Health Bill, which, if enacted can have a very positive effect to take appropriate measures during the time of the epidemic. With COVID-19 crisis of today, our legislature should consider and understand the difficulties faced by the government today and accordingly enact a new and an effective legislation.

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NIRBHAYA CASE: DO WE CONTINUE TO FAIL? SAHIL SOOD

INTRODUCTIONIn a recent report by an award winning journalist, Ms. Priyanka Dubey1, observed that our country was known as one of the world’s most dangerous for women where it is estimated that a woman is raped every fifteen minutes, out of which 99% of the rapes go unreported.2 We may be developing or achieving developmental landmarks, but much is desired in the spheres of law and order.

AMENDMENTS IN LAWPursuant to the horrific Nirbhaya3 incident, many issues came under the lens and various amendments were brought out in the Criminal laws of India in the year 20134. The Criminal Law Amendment Act of 2013 came into the picture which is popularly called Nirbhaya Act. This Act made substantive changes in the definition of ‘rape’ under the Indian Penal Code, 1860 (“IPC”), wherein section 375 was widened to include acts other than forcible peno-vaginal penetration or sexual intercourse. Further, several amendments were made in the IPC, including:

(i) Section 166A was added for punishing public servants who refuse to record an FIR in cases of specified crimes against women including rape;

(ii) a new proviso was incorporated under section 166B punishing those in charge of a public or private hospital for refusal to provide free medical treatment for victims of rape;

(iii) the scope of section 376(2) was expanded to include rape committed by a member of armed forces deployed in an area by the Central or a State Government in such area; and

1 Economic Times

2 NCRB data, 2018

3 A 23 years old physiotherapy student was gang raped on a bus.

4 Bill No. 63 of 2013

(iv) a separate section i.e. 376D for the offences of gang rape with higher punishment was added.

The other statutes including the Code of Criminal Procedure, 1973 (“CrPC”) and the Evidence Act, 1872 (“Evidence Act”) were also amended to bring them in consonance with the punishments.

In CrPC, section 154(1) that provided for recording of an FIR was amended to include that in certain offenses against women (including rape), the FIR has to be recorded by a police officer, at her residence or at place of her choice. Section 164 (5A) was added in the CrPC which made it mandatory for the Judicial Magistrate to record the statement of the victim, as soon as the commission of the offence was brought to the notice of the police. Further, an explanation was added to section 197(1) of the CrPC which provides the prosecution of judges and public servants.

MAJOR CHANGES WERE ALSO MADE IN THE EVIDENCE ACT WHEREIN(i) Section 53 A was inserted which dealt with

evidence of character of previous sexual experience;

(ii) section 144A was substituted by a new one stating that in prosecution for rape under clause (a) to (n) of section 376(2) IPC, where sexual intercourse by the accused is proved and the question is whether it was without the consent of the woman alleged to have been raped and such woman states in her evidence before the court that she did not consent, the court shall presume that she did not consent;

(iii) the proviso to section 146 was substituted with the existing one to state that in a prosecution for rape, it shall not be permissible to adduce evidence or to put questions in the cross examination of the victim as to the general immoral character or previous sexual experience of such person with any person for proving such

“JUSTICE WILL NOT BE SERVED UNTIL THOSE WHO ARE UNAFFECTED ARE AS OUTRAGED AS THOSE WHO ARE”

BENJAMIN FRANKLIN.


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consent or quality of consent.

Apart from the aforesaid, the Hon’ble Chief Justice of India also launched fast track courts to deal with such cases speedily. Unfortunately, though the law came with more stringent penalties for rape, after Nirbhaya incident, the statistics of National Crime Records Bureau (“NCRB”)5 shows that there has been a significant growth in the rape crimes – which can be counted as a failure towards preventive approach, meaning thereby, that, there came no rape-deterrent effect in the law in our country, which resultantly frustrates the purpose of Criminal Law in this matter to a large extent.

EFFECT OF THE JUDICIAL SYSTEM As the memories of Nirbhaya case waned from the minds of people, the nation mourned yet another rape victim when another horrific incident from Hyderabad came to light in 2019, where a 27-year old veterinary doctor was brutally gang raped and thereafter burnt alive. The incident elicited outrage amongst the people demanding speedy justice unlike Nirbhaya, where the case was being held up in court for 7 years. Many demonstrations were organized across the country demanding justice. In the meantime, in a follow-up incident in the Hyderabad case, news erupted that the four suspects in the case were killed by the Hyderabad Police in an encounter in the police custody. Expectedly, the said act of police was celebrated by the people of India. Though the speedy justice delivered to the victim by way of such encounter was hailed all over the nation including the victim’s family, the family still claimed that police could have been more vigilant and responsive when the father of the victim had approached them on the same day around 11 p.m. but the police officials allegedly wasted time on the applicability of jurisdiction in ascertaining the concerned police station and in delaying the investigation on unfounded process.6

5 National Crime Record Bureau, set up in 1986 to function as a repository

of information on crime and criminals so as to assist the investigators in

linking crime to the perpetrators.

6 Family of 4 Hyderabad rape Accused move Supreme Court for case

against police encounters and the Supreme Court though an order, set up

an inquiry commission led by former Apex Court judge (Justice Retd.) V.S.

Sirpurkar, retired Bombay High Court judge Rekha Baldota and Retd. CBI

Director D.R. Karthikeyan, to probe the circumstances of encounter and

the investigation to be completed within 6 months

However, it is pertinent to note that taking law and order in our hands without a fair trial to the accused is truly no solution at all. Though for a limited frame of time, we may celebrate the so called speedy ‘justice’ to justify the act, but the question remains – how does the police differentiate between a suspect and a convict? It is important to understand and appreciate the primary principle of criminal law is that every man is presumed innocent until proven guilty. The pressure by the public for speedy justice may lead to unfair ways of punishing the suspects. Justice cannot be meted out just to please public at large, it has to go with the touchstone of fair trial.

DISHA ACTWhile the inquiries on encounters by police machinery continue, the state government of Andhra Pradesh has passed a new act called, the Andhra Pradesh Criminal Law Amendment Act, 2019, also called the Disha7 Act7, prescribing punishment of death sentence for rape offenses, if adequate conclusive evidence is available and for providing an expedited trial of 21 days in such cases. The Act is however silent on what adequate conclusive evidence will be, to determine the real offenders. Another highlighting feature of the Act is concluding the investigation within 7 days while trials shall be determined in 14 days which goes to 21 days.

In one of the cases, Bodhisattwa Gautam vs. Subhra Chakraborty,8 the Supreme Court said that rape is a crime not only against a woman but against the entire society. Rape destroys the entire psychology of a woman and pushes her in a deep emotional crisis. It is only by her sheer will power that she rehabilitates herself in the society which on coming to know of the rape, looks down upon her in derision and contempt.

CONCLUSION It is no doubt that government is taking steps to reduce rape offenses, however, no stringent preventative actions are taken to stop the occurrence of such offenses. The very roots of the law need to be made stronger before jumping over onto the branches. Remedial actions may eliminate the non-conformities in laws by deterring the accused from committing such crimes. However to those hardened criminals or psychopaths who find no guilt in ignoring the laws, taking preventive actions would eliminate the cause of

7 New section 354E shall be added in the IPC, 1860

8 1996 SCC (1) 490 by Justice Ahmad Sanghir S. and Justice Kuldip Singh

3 6


potential crime itself. It is just like we have principles of State Policy and fundamental rights9 together, we should have both the Act and preventive procedures of acting vigilantly to stop the commission of such crimes. Major grey area in the Disha Act and Nirbhaya Act is that neither Act prescribes steps or procedure to be followed by police in order to prevent the occurrence of the crimes against the women. The preventive action includes vigilant actions by police in reaching out to the victim on time and saving her from becoming a scapegoat in the hands of wild animals. There should be a turnaround time for specifying time taken by police to reach out the victims.

An American abolitionist once said, “All history attests that man has subjected women to his will, used her as a means to promote his gratification, to minister his sexual pleasures, to be instrumental in promoting his comfort; but never has he desired to elevate her to that rank she was created to fill.”

***

9 Constitution of India, 1950


3 7

BCCI UNDER THE AMBIT OF RIGHT TO INFORMATION: TO BE OR NOT TO BE?

MOONMOON NANDA

WITH

ANANYA MAHANT AND ARSHITA BANSAL, LAW INTERNS

INTRODUCTIONThe question whether or not the Board of Control for Cricket in India (“BCCI”) must be subject to the Right to Information (RTI) Act has been of primary importance over the past couple of years. In times when people are demanding increasing transparency and accountability, the hot topic of why or why not the BCCI should be covered under the RTI Act has been garnering varied opinions and views from scholars, policy makers, academicians and even common citizens interested in the sport and its administration.

The BCCI was set up on December 4th 1928, by a handful of players at Delhi’s Roshnara Club to mark an end to the British monopoly in India, an attempt to establish Indian identity in the cricketing world. The BCCI neither follows a proper regulated structure like other sporting bodies in the world nor does it follow laws of corporate governance.

The basic functions agreed upon by the members of this board were advancing and controlling the game of cricket across India, arranging and controlling inter-country, foreign and other cricket matches, to make arrangements related to visits of teams to India, and if necessary to control and arrange all or any inter-territorial disputes, as well as to settle disputes or differences between associations allied to the board.

But till date, this body has not been accountable to the citizens of the country and the government at large.

RIGHT TO INFORMATIONJustice PN Bhagwati has rightly said “Where a society has chosen to accept democracy as its creedal faith, it is elementary that the citizens ought to know what their government is doing”. Transparency and accountability in administration is the sine qua non of a participatory democracy. In India, till 2005, there was no way of

garnering access to any information related to the working of any public authority or matters related to the public interest of people, making it difficult for the common man to participate effectively in the decision making process.

However, due to increased awareness and the growing consciousness of people, the inbuilt desire to know about the country’s decision-making bodies grew intense. In such circumstances, our judiciary played an animated role to strengthen public transparency. The Supreme Court, in the case of S.P Gupta v. Union of India1 opined that considering a democratic set up, the people have full right to know about the functioning of the government. Similar, it was also held in the case of Prabhu Dutt v. Union of India2 that the right to know news and information regarding the administration of the Government is included in the freedom of press.

The Right to Information Act3 is considered to be path breaking in deflecting corruption and unjustified delays in the implementation of public policies and decisions of the public authorities. “The basic objective of the Right to Information Act is to empower the citizens, promote transparency and accountability in the working of the Government, contain corruption, and make our democracy work for the people in real sense.”4 RTI Act brought together the two most important tools ‘transparency and accountability’ together for eradicating the evil that had become hindrance to good governance.

1 S.P Gupta v. Union of India, (1993) 4 SCC 441.

2 Prabhu Dutt v. Union of India, AIR 1982 SC 6.

3 Right to Information Act, 2005, No. 22, Acts of Parliament, 2005 (India).

4 Guide on Right to Information Act, 2005, Government of India, Ministry of Personnel, Public Grievances & Pensions, Department of Personnel & Training.

3 8


Section 2(f )5 of the Act which defines ‘information’ says that such information can also be retrieved which belongs to any private body which can be accessed by a public authority under the law being in force. When this is read with the proviso of Section 8(1)(j)6 of the Act which states that information which cannot be denied to the State Legislature and the Parliament cannot be denied to any person, it can be understood that private bodies also fall under the RTI Act indirectly. Interestingly, in the recent case of D.A.V College Trust and Management Society and Others v. Director of Public Instructions and Others7 the Supreme Court has held that NGOs and other private institutions receiving substantial governmental funding come under the ambit of the RTI Act. However, it said whether an NGO or body is substantially financed by the government is a question of fact which has to be determined on the facts of each case as there may be cases where the finance is more than 50% but still may not be called substantially financed.

SHOULD BCCI DUCK THIS BOUNCER OR PLAY IT?In today’s capitalistic world, sports has become a business for the corporate world. It has shifted the burden of legal regulation onto certain international and national sports federations which control and govern these sports. But in case of cricket, the BCCI is a private venture, having its own rulebook that often caters to their own convenience. It takes certain decisions that have serious implications on the careers of players which in turn giving rise to economic consequences.

BCCI is an autonomous organisation least accountable to the public, players and even the government. It enjoys a clear monopoly status8 with enormous economic and political power but with zero transparency. BCCI has the power to make laws to regulate itself and amend these laws as per its own whims and fancies.

5 “Information” means any material in any form, including records, documents, memos, e-mails, opinions, advices, press releases, circulars, orders, logbooks, contracts, reports, papers, samples, models, data material held in any electronic form and information relating to any private body which can be accessed by a public authority under any other law for the time being in force.

6 Right to Information Act, 2005, §8(1)(j).

7 D.A.V College Trust and Management Society and Others v. Director Of Public Instructions And Others, 2019 (9) SCC 185.

8 BCCI v. Netaji Cricket Club and Ors., (2005) 4 SCC 741.

Although BCCI is technically a private body, it’s various working and functioning shows that it discharges public functions. Activities like selecting a team that represents India in international matches, disqualification of players and umpires, to name a few. In 2016 in BCCI v. Cricket Association of Bihar and Ors.9, Justice Lodha Committee was set up to make recommendations to the BCCI. The committee believed that the BCCI should discharge public functions subject to an indirect approval of the Central and State Governments that has created a monopoly in the hands of BCCI. It observed, “It is performing a public function of selecting the national and international team to represent the nation at a global front. It regulates cricket in India of all forms at all levels. The decision of Zee Telefilms v. Union of India requires some reconsideration on the ground that it performs the public function involving millions of funds and arbitrary using its power in recent past. Therefore, it should be considered State under Article 12 of Indian Constitution”. The Committee also felt that the people of the country have a right to know the details about the BCCI’s functions and activities. It was therefore, recommended by apex court that the legislature must seriously consider bringing BCCI within the purview of the RTI Act. The same was upheld in the case of Subhash Chandra Agrawal v. PIO, Department of Sports10.

The Law Commission of India, that works as an advisory body to the Ministry of Law & Justice, in its 275th report11 asked the Government to treat BCCI as an agency of the state under Article 1212 of the Indian Constitution as BCCI controls the policy formulation and implementation related to cricket, affecting the country at large, which the commission believed to be a State function.

It is pertinent to mention that when private individuals or groups are endowed by the state with powers or functions governmental in nature, they become agencies or instrumentalities of the State.13 Even where a corporation is privately performing a public function

9 2017 SCC Online SC 370.

10 Central information Commission, Subhash Chandra Agrawal v. PIO, Department of Sports, Order No. CIC/LS/2012/000565.

11 Law Commission of India, Reforms in the Judiciary: Some Suggestions, Report No. 275, 18 (April 2018).

12 INDIA CONST. art. 12.

13 Evans v. Newton, 382 U.S. 296 (1966); Marsh v. Alabama, 326 U.S. 501 (1946).


3 9

it is bound by the constitutional standards applicable to all State actions.14

Moreover, in October 2018, the Central Information Commission, the top appellate body in RTI matters, went through the law, orders of the Supreme Court, the Law Commission of India report, submissions of the Central Public Information Officer in the Ministry of Youth Affairs and Sports and concluded that the status, nature and functional characteristics of the BCCI requires fulfilment of the conditions of Section 2(h) of the RTI Act.15 Section 2(h) of the Act defines criteria under which a body can be declared as public authority under the RTI Act. As per this Section, public authority includes anybody or institution controlled or substantially financed, either directly or indirectly by the Government. There is no direct financial assistance to BCCI by the Central Government, but it has been granting concessions in Income tax, customs, etc. to BCCI. Even land is provided at highly discounted rates or nominal value by the Centre and State for the construction of cricket stadiums. These concessions amount to thousands of crores of rupees. This qualifies as indirect funding by the Government. Given all these reasons, one may infer that that the BCCI carries out public functions and also receives governmental exemptions.16

CONCLUSION If BCCI is treated as a State under Article 12, it will make BCCI subject to constitutional discipline of fundamental rights. Once BCCI comes under the ambit of RTI, it will improve the ethical standards and discipline in the game, promote efficiency in the management of BCCI, provide accessibility and transparency, prevent conflict of interest situations and eradicate political and commercial interference and abuse and create mechanisms for resolution of disputes within the BCCI.

***

14 A.C. Muthiah v. BCCI, (2011) 6 SCC 617; Sukhdev v. Bhagatram Sardar Singh Raghuvanshi, (1975) 1 SCC 421

15 Right to Information Act, 2005, §2(h).

16 Smt. Geeta Rani v. CPIO, M/o Youth Affairs & Sports, CIC/MOYAS/A/2018/123236.

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NOTES

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MARCH 2020. Vol. XIII, Issue III

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