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Showing 41 to 60 of 738 Records
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2009 (11) TMI 998
Issues involved:
The issues involved in this case are the maintainability of a writ petition when an alternative remedy is available, the violation of principles of natural justice in the termination of services, and the requirement of following statutory rules in imposing major penalties.
Maintainability of Writ Petition:
The appellant, a lecturer promoted to Principal, had her services terminated without a show-cause notice or disciplinary proceedings. The High Court dismissed her writ petition citing the availability of an alternative appeal remedy. The Supreme Court held that a writ petition can be maintainable in cases of lack of jurisdiction, violation of natural justice, or questioning the vires of an act. Referring to previous cases, the Court emphasized the exceptions where a writ petition can be entertained despite an alternative remedy being available.
Violation of Principles of Natural Justice:
The termination order was passed without initiating disciplinary proceedings or providing an opportunity for a hearing to the appellant. The Supreme Court found that the High Court erred in rejecting the writ petition on the grounds of an alternative remedy being available. It was noted that the order of termination lacked the necessary disciplinary proceedings and hearing, making the writ petition maintainable under the law.
Compliance with Statutory Rules:
The Supreme Court highlighted that before imposing a major penalty like termination, an inquiry must be conducted as per statutory rules. The disciplinary authority must frame charges, provide an opportunity for a written statement and a hearing, and obtain approval from the Managing Committee. The High Court's dismissal of the writ petition was deemed erroneous in light of these statutory requirements. The Court set aside the termination order, allowing for the initiation of proper disciplinary proceedings with due process.
Conclusion:
The Supreme Court set aside the High Court's judgment, quashed the termination order, and allowed the writ petition. It directed the authorities to follow statutory rules in any future disciplinary proceedings against the appellant. The appeal was allowed with no costs imposed.
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2009 (11) TMI 997
Issues involved: Petitioner aggrieved by striking off its name from the register of Companies u/s 560(5) of the Companies Act without proper notice.
Summary:
The petitioner challenged the striking off of its name from the register of Companies under Section 560(5) of the Companies Act, contending that no proper notice was served as required by the Act. The Company claimed to be actively operating and had filed statutory returns before the publication of the notification. The Registrar of Companies stated that notices were issued to the petitioner, but there were discrepancies in the process, such as lack of sending the second notice by registered post as required. The Registrar argued that the publication of notice under Sub-section (3) was not mandatory, but the Court disagreed, emphasizing the mandatory nature of the provisions. The Court found violations of the Act's provisions and quashed the notice, ordering the restoration of the petitioner Company's name in the register. The Company was directed to file all statutory returns within six weeks, and any legal actions against the company during the period of its name being struck off would not be barred by limitation.
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2009 (11) TMI 996
Issues Involved:
The issues involved in the judgment are related to the denial of copies of documents to the appellant by the CPIO and the Appellate Authority, and the refusal to provide copies of comments received from third-parties under Section 11(1) of the RTI Act.
Denial of Copies of Documents:
The appellant stated that he was denied copies of documents he had inspected, with the authorities claiming that a fresh RTI application was needed for copies. The Commission found this position untenable, emphasizing that the RTI Act allows for inspection, taking notes, and obtaining copies of records. The Commission directed that the appellant should be allowed to take copies of the documents he inspected within two weeks, upon payment of the requisite fee.
Request for Third-Party Comments:
The appellant also requested copies of comments received from third-parties under Section 11(1) of the RTI Act. The respondents argued that there was no obligation to provide such copies. The Commission noted that while Section 11(1) focuses on consulting third-parties confidentially, the Act requires reasons for denial of information under various sections, including Section 11(1). The Commission highlighted the importance of providing reasons for decisions and directed that the requested information, including third-party comments, be disclosed to the appellant within one week.
Disclosure of Third-Party Averments:
The Commission discussed the disclosure of third-party submissions to the CPIO under Section 11, stating that disclosure is the norm unless it jeopardizes the third-party's interests. The Commission outlined guidelines for handling third-party submissions, emphasizing the need for reasons for decisions and the disclosure of such submissions to the appellant unless they cause harm or injury to the third-party. In this case, the Commission directed that the third-party comments should be disclosed to the appellant.
Conclusion:
The Commission disposed of the appeal with directions for providing copies of documents to the appellant and disclosing third-party comments within specified timelines. The parties were instructed to receive copies of the directions.
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2009 (11) TMI 995
Accrual of receipts - Undeclared sale price of machinery - Correct assessment year - ITAT has affirmed the order of the CIT(A) that as per the terms of the contract, only 85% of the amount was to be received by the Assessee till the supply of machinery in the assessment year under consideration and the remaining 15% amount was payable to the Assessee, after issuance of provisional acceptance certificate and other requirements, therefore, the Assessee had not acquired the right to receive 15 per cent of the price till the conditions of contract were fulfilled - HELD THAT:- We find that the Assessee had not received right only on 85 per cent of amount which can be enforced in court of law. No debt came into existence in respect of balance amount of 15 per cent in respect of which the Assessee must have acquired a right to receive the payment. The balance amount will accrue to Assessee on completion of contract as per its terms and conditions.
The contention of the Revenue that on matching principle the amount of expenditure incurred in respect of the machinery work has been debited in the Profit & Loss Account will not be of much help on the ground that in the subsequent year the entire amount has been subject to tax without any debiting of the expenditure in profit and loss account. Thus the amount in respect of the machinery work is not assessable in the year under consideration. Assessee's case is also covered by the decision of Ignifluid Boilers (India) Ltd. [2006 (1) TMI 76 - MADRAS HIGH COURT]. Accordingly, we do not find any infirmity in the order passed by Ld. CIT(A) deleting the addition.
Excess depreciation claimed on office equipment and electric installation - allowing of depreciation on office equipment and electric installation like transformer or control panels at the rate of 25 per cent as against 15 per cent as allowed by the AO - HELD THAT:- No ground to interfere in the aforesaid findings, as a finding of fact has been recorded by the learned ITAT. The transformer and control panels cannot be taken as part of office furniture. The Fax machine and CCTV systems, which are being used in the business of the Assessee, have rightly been given depreciation at the rate of 25 percent, by treating them as part and parcel of plant and machinery and these items cannot be treated as part of office furniture.
No merit in the instant appeal and in our opinion no substantial question of law arises from the order of the ITAT.
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2009 (11) TMI 994
Issues Involved:
1. Effect of seven years' experience as an Advocate for eligibility as a District Judge under Article 233(2).
2. Impact of the Shetty Commission's recommendations and the Supreme Court's acceptance in the All India Judges' case.
3. Validity and impact of the amendment to the Kerala Higher Judicial Service Rules, 1961, prescribing age limits on the rights of candidates who applied before the amendment.
Issue-wise Detailed Analysis:
1. Effect of Seven Years' Experience as an Advocate for Eligibility as a District Judge under Article 233(2):
The court examined whether the prescription of age limits in the amended rules was ultra vires Article 233(2) of the Constitution, which requires seven years of experience as an Advocate for eligibility. The court held that the founding fathers intended to incorporate the requirement of practice and did not preclude the appropriate authority from prescribing additional qualifications that do not conflict with the constitutional mandate. The prescription of good character and age limits were found to be valid and not incompatible with Article 233(2).
2. Impact of the Shetty Commission's Recommendations and the Supreme Court's Acceptance in the All India Judges' Case:
The court considered whether the acceptance of the Shetty Commission's recommendations by the Supreme Court amounted to a declaration of law that automatically amended the statutory rules. It was held that the Supreme Court's judgment did not intend to bring the age limits into force without an amendment to the rules. The court noted that the High Court and the State Government did not perceive the judgment as amending the rules and proceeded to amend the rules prospectively.
3. Validity and Impact of the Amendment to the Kerala Higher Judicial Service Rules, 1961, Prescribing Age Limits on the Rights of Candidates Who Applied Before the Amendment:
The court analyzed whether the amendment to the rules, prescribing minimum and maximum age limits, could affect the rights of candidates who had applied and passed the written test before the amendment. It was held that the amendment was prospective and could not impair the rights of candidates who had already applied under the previous rules. The court relied on established legal principles that once a recruitment process has commenced, the rules of the game cannot be altered to the detriment of the applicants. The court declared the exclusion of the petitioners based on the amended age limits as illegal and directed the High Court and the State of Kerala to consider the petitioners' claims in accordance with the rules as they existed at the time of the notification.
Conclusion:
The amendment to the Kerala Higher Judicial Service Rules, 1961, prescribing age limits was held to be prospective and not applicable to candidates who had applied before the amendment. The court directed the High Court and the State of Kerala to consider the claims of the petitioners for appointment as District Judges based on the rules in force at the time of the notification. The judgment emphasized the principle that the rules governing a recruitment process cannot be changed midstream to the detriment of applicants who have already applied.
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2009 (11) TMI 993
Issues Involved:
1. Readiness and willingness of the plaintiff to perform his part of the contract.
2. Entitlement of the plaintiff to the discretionary remedy of specific performance.
3. Entitlement of the plaintiff to the alternative remedy of refund of the advance consideration with interest.
Issue-wise Detailed Analysis:
1. Readiness and Willingness of the Plaintiff to Perform His Part of the Contract:
The core question was whether the plaintiff, who failed to deposit the balance sale consideration for four years, was always ready and willing to perform his part of the contract. The agreement stipulated that the balance amount of Rs. 25,000 was to be paid within one year. The plaintiff paid an additional Rs. 10,000 but failed to pay the remaining Rs. 15,000 within the stipulated time. The plaintiff argued that he was always ready and willing to perform his part of the contract and had sufficient funds. However, the trial court found that he did not deposit the balance amount despite obtaining a lodgment schedule. The appellate court noted that the plaintiff's failure to deposit the amount, despite obtaining a challan, indicated a lack of readiness and willingness. Furthermore, the plaintiff did not produce any evidence to substantiate his financial capacity. The court concluded that the plaintiff was not ready and willing to perform his part of the contract.
2. Entitlement of the Plaintiff to the Discretionary Remedy of Specific Performance:
Specific performance is an equitable remedy, and the plaintiff must come to the court with clean hands. The trial court granted specific performance based on the plaintiff's contention that he was ready and willing to perform his part of the contract. However, the appellate court found that the plaintiff had not approached the court with clean hands. The plaintiff misled the court by stating that he had applied for a lodgment schedule to deposit the balance amount but failed to deposit the amount. The court emphasized that the plaintiff's conduct was not trustworthy, and he failed to comply with the mandatory conditions of the agreement. The court held that the plaintiff was not entitled to the equitable remedy of specific performance due to his lack of readiness and willingness and his attempt to mislead the court.
3. Entitlement of the Plaintiff to the Alternative Remedy of Refund of the Advance Consideration with Interest:
The plaintiff sought an alternative relief of refund of the advance consideration with interest at 18%. The court noted that the plaintiff had paid Rs. 1,50,000 as advance and Rs. 10,000 subsequently. Although the plaintiff was not entitled to specific performance, he was entitled to a refund of the advance amount with interest. The court awarded the plaintiff a refund of Rs. 1,60,000 with simple interest at 18% per annum from the date of the plaint until realization.
Conclusion:
The appellate court set aside the trial court's judgment and decree granting specific performance. The court found that the plaintiff was not ready and willing to perform his part of the contract and had not approached the court with clean hands. The plaintiff was granted an alternative decree for refund of the advance amount with interest at 18% per annum from the date of the plaint until realization. The appeal was allowed, and the judgment and decree of the trial court were set aside.
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2009 (11) TMI 992
Issues involved:
1. Interpretation of Section 21 of the Legal Services Authorities Act, 1987 regarding the executability of awards passed by Lok Adalat in cases referred from criminal courts.
2. Whether an award passed by Lok Adalat on reference from a criminal court can be considered a decree of a civil court and thus be executable by the civil court.
Judgment Details:
1. The petitioner filed a complaint u/s 138 of the Negotiable Instruments Act, which was settled in Lok Adalat resulting in an award for payment in instalments. The petitioner sought execution of the award in the Munsiff Court, which was declined. The challenge was made u/s Article 227 of the Constitution of India.
2. The petitioner contended that as per Section 21 of the Legal Services Authorities Act, every Lok Adalat award is deemed to be a decree of a civil court. Case laws were cited to support this argument.
3. The court considered whether an award from Lok Adalat in a criminal case can be treated as a civil court decree. It was held that awards from Lok Adalat on criminal case references cannot be executed as civil court decrees. The court emphasized that a criminal court cannot pass a decree, and thus, an award from Lok Adalat on a criminal case reference remains an order of the criminal court.
4. The judgment concluded that the Munsiff's order declining execution of the Lok Adalat award in the present case was proper. The petition lacked merit and was dismissed.
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2009 (11) TMI 991
Issues Involved:
1. Appointment of Arbitrator u/s 11(6) of the Arbitration and Conciliation Act, 1996.
2. Validity and enforceability of the Share Subscription and Shareholders Agreement (SHA) dated December 1, 2005.
3. Dispute regarding non-issuance of shares under the Scheme of Amalgamation.
4. Applicability of arbitration clause in the SHA to the respondent company.
Summary:
1. Appointment of Arbitrator u/s 11(6) of the Arbitration and Conciliation Act, 1996:
The applicant Company filed an application u/s 11(6) of the Arbitration and Conciliation Act, 1996, seeking the appointment of Mr. Justice D.R. Dhanuka as Sole Arbitrator to adjudicate disputes arising under the Share Subscription and Shareholders Agreement (SHA) dated December 1, 2005. The respondent Company opposed the application, arguing that the disputes did not arise out of the SHA and thus could not be referred to arbitration.
2. Validity and enforceability of the Share Subscription and Shareholders Agreement (SHA) dated December 1, 2005:
The applicant claimed that under the SHA, it supplied CISCO equipment worth US$ 400,000 to Exatt Technologies Private Limited (Exatt), which acknowledged the delivery. The applicant was to receive 6920 equity shares of Rs. 10/- each in Exatt, but only received a Xerox copy of the share certificate, not the original. The respondent contended that the SHA was a preliminary and tentative draft and not enforceable. The Court found that the SHA was acted upon and signed by both parties, and thus enforceable.
3. Dispute regarding non-issuance of shares under the Scheme of Amalgamation:
The applicant argued that under the Scheme of Amalgamation approved by the High Court of Bombay, it was entitled to 1,73,000 equity shares of the respondent Company, which were never issued. The respondent countered that the applicant was not listed in the register of members of Exatt and thus not entitled to shares. The Court held that the dispute regarding the non-issuance of shares under the SHA and the Scheme of Amalgamation was arbitrable.
4. Applicability of arbitration clause in the SHA to the respondent company:
The Court found that Clause 11.7 of the SHA, which contains the arbitration agreement, was applicable to the respondent Company as the successor-in-interest of Exatt. The respondent's failure to act under the agreed procedure for appointing an arbitrator justified the applicant's approach to the Court. The Court concluded that the conditions for exercising power u/s 11(6) were fulfilled.
Conclusion:
The application was allowed, and Mr. Justice D.R. Dhanuka was appointed as Sole Arbitrator to adjudicate the disputes under the SHA dated December 1, 2005. The Arbitrator was requested to enter upon the reference and determine his own fees. The Court clarified that no part of the dispute was decided on merits, leaving all questions, including arbitrability, to be decided by the Arbitrator. No order as to costs was made.
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2009 (11) TMI 990
Issues Involved:
1. Disallowance of deduction under section 80HHC.
2. Market value determination of electricity generated by the eligible unit.
3. Deduction under section 80HHC for the purpose of computation of book profit under section 115JB.
4. Credit allowable under section 115JAA for the purpose of levy of interest under section 234B.
5. Disallowance of traveling expenses, postage, telephone expenses, and miscellaneous expenses.
6. Provision for gratuity, leave encashment, and deferred tax as ascertained liabilities within the meaning of clause (c) of Explanation below section 115JA(2).
Issue-wise Detailed Analysis:
1. Disallowance of Deduction Under Section 80HHC:
The main contention was whether the deduction under section 80IA should be reduced from the deduction under section 80HHC. It was agreed by both parties that the issue is covered by the decision of the Special Bench of the Delhi Tribunal in the case of ACIT vs. Hindustan Mint and Agro Product (P) Ltd. The Tribunal held that the restriction in section 80IA(9) or 80IB(9A) applies to the same profit to prevent repeated deductions. Following this decision, the Tribunal set aside the order of the CIT(A) and directed the AO to re-decide the issue of computation of deduction under section 80HHC as per the Special Bench's decision.
2. Market Value Determination of Electricity Generated by the Eligible Unit:
The dispute was whether the market value of electricity generated by the captive unit should be taken at Rs. 4.28 per unit or Rs. 4.9 per unit. The Tribunal referred to the decision of the Mumbai Bench in the case of West Coast Paper Mills Ltd vs. JCIT, which held that the cost of electricity produced by the captive unit should be taken at the market value, i.e., the average annual landed cost of electricity purchased from the state electricity board. The Tribunal directed the AO to compute the deduction under section 80IA by taking the market value of electricity at Rs. 4.9 per unit.
3. Deduction Under Section 80HHC for the Purpose of Computation of Book Profit Under Section 115JB:
The Tribunal referred to the decision of the Special Bench of the Mumbai Tribunal in DCIT vs. Syncome Formulations (I) Ltd, which held that the deduction under section 80HHC in the case of MAT assessment should be worked out on the basis of adjusted book profit under section 115JA. However, the Tribunal concluded that the assessee would not be entitled to the deduction under section 80HHC in view of the provisions of section 80IA(9), and thus, this ground of appeal was dismissed.
4. Credit Allowable Under Section 115JAA for the Purpose of Levy of Interest Under Section 234B:
The Tribunal relied on the decision of the Madras High Court in CIT vs. Chemplast Sanmar Ltd, which held that MAT credit under section 115JAA should be given before charging interest under section 234B and 234C. The Tribunal directed the AO to reduce the credit available under section 115JAA first and then compute the interest under section 234B.
5. Disallowance of Traveling Expenses, Postage, Telephone Expenses, and Miscellaneous Expenses:
The AO disallowed 20% of the expenses due to lack of proper checks. The Tribunal found the disallowance on the higher side and directed the AO to disallow only 1/10th of the expenses, considering it fit and proper for both parties.
6. Provision for Gratuity, Leave Encashment, and Deferred Tax as Ascertained Liabilities:
The Tribunal agreed with the CIT(A) that provisions for gratuity and leave encashment are ascertained liabilities. However, it held that the provision for deferred tax cannot be regarded as an ascertained liability and should be added to the book profit for MAT computation under section 115JB. The Tribunal directed the AO to re-compute the MAT after adding the provision for deferred tax.
Conclusion:
The appeals were partly allowed, with directions provided for re-computation and reconsideration of specific issues by the AO. The Tribunal's decisions were based on precedents and detailed analysis of the relevant provisions and judicial interpretations.
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2009 (11) TMI 989
Issues involved: Violation of securities laws, manipulation of trades, non-compliance with investigations, violation of code of conduct.
Violation of securities laws: The appellant, a registered stock broker, was found to have violated Regulations 3 and 4 of the Securities and Exchange Board of India (Prohibition of Fraudulent and Unfair Trade Practices Relating to Securities Market) Regulations, 2003, and clauses of the code of conduct for stock brokers. The appellant failed to provide complete information during investigations, leading to a monetary penalty of Rs. 4 lakhs imposed under sections 15A(a), 15HA, and 15HB of the Securities and Exchange Board of India Act, 1992.
Manipulation of trades: The appellant executed trades on behalf of clients in a manner that artificially raised the price of a company's shares, from Rs. 10.70 to Rs. 166. The appellant traded for both buyers and sellers, contributing to the price rise by putting orders into the system at rates higher than prevailing market prices. The tribunal found that the appellant interfered with the price and order matching mechanism, violating section 15HA of the Act.
Non-compliance with investigations: The appellant failed to fully comply with summons and requests for information during investigations. Incomplete information provided hindered the investigations, constituting a violation of section 15A(a) of the Act. The tribunal emphasized the importance of market players cooperating with regulatory authorities for effective market regulation.
Violation of code of conduct: By not exercising due skill, care, and diligence while executing trades, the appellant interfered with the fair functioning of the stock market, breaching the code of conduct prescribed for stock brokers. The tribunal held the appellant accountable for violating the broker regulations.
Separate Judgment (Appeal no. 49 of 2009): In a similar case involving M/s. M. Bhiwani wala & Company, also a registered stock broker, identical manipulative trades were executed on behalf of buyers and sellers. The tribunal found that the appellant in this case also violated the code of conduct prescribed for stock brokers and manipulated the price and order matching mechanism of the Stock Exchange.
In conclusion, both appeals were dismissed, upholding the penalties imposed for violations of securities laws, manipulation of trades, non-compliance with investigations, and breach of the code of conduct.
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2009 (11) TMI 988
Issues Involved:
1. Validity of the unregistered agreement to sell.
2. Existence and enforceability of the arbitration agreement.
3. Appointment of an arbitrator under Section 11(6) of the Arbitration and Conciliation Act, 1996.
Issue-wise Detailed Analysis:
1. Validity of the Unregistered Agreement to Sell:
The respondent contended that the agreement to sell dated 6.12.2002 is void as it is an unregistered document and does not create any interest or charge on the property under Section 54 of the Transfer of Property Act and Section 17(1)(b) of the Registration Act, 1908. The respondent argued that the unregistered document could not affect any immovable property or be received as evidence of any transaction affecting such property unless it is registered, as per Section 49 of the Registration Act. The applicant countered by stating that the arbitration clause in an agreement to sell or any document is independent and issues relating to it fall within the jurisdiction of the arbitrator. The applicant relied on the case of A.R.C. Overseas Pvt. Ltd. v. Bougainvillea Multiplex and Entertainment Centre Pvt. Ltd., which held that an arbitration clause in an unregistered document still obligates the court to refer the parties to arbitration.
2. Existence and Enforceability of the Arbitration Agreement:
The respondent argued that the agreement to sell does not constitute an arbitration agreement under Section 7 of the Arbitration and Conciliation Act, 1996, as it does not create a defined legal relationship. The respondent further contended that the arbitration clause does not provide for enforcement of the agreement to sell and its registration by referring the dispute to the arbitrator. The applicant argued that the arbitration clause clearly reflects the intention of the parties to arbitrate disputes arising from the agreement. The applicant also relied on the decision in Olympus Superstructure Pvt. Ltd. v. Meena Vijay Kheta, which affirmed that issues relating to specific performance of an agreement of sale can be referred to arbitration.
3. Appointment of an Arbitrator under Section 11(6) of the Arbitration and Conciliation Act, 1996:
The applicant sought the appointment of an arbitrator under Section 11(6) after the named arbitrator, Sri Hari, declined to act. The respondent opposed this, arguing that the refusal of the named arbitrator brought an end to the arbitration agreement. The court noted that under Section 11(6), if the named arbitrator refuses to act, the parties can approach the court for the appointment of an arbitrator. The court found that the arbitration clause in the agreement to sell is valid and reflects the intention of the parties to arbitrate disputes. Therefore, the court appointed a retired judge of the High Court, Mr. Justice M.C. Agarwal, as the arbitrator, subject to his consent.
Conclusion:
The court concluded that the arbitration clause in the agreement to sell dated 6.12.2002 is valid and enforceable. The application under Section 11(6) of the Arbitration and Conciliation Act, 1996, was allowed, and Mr. Justice M.C. Agarwal was appointed as the arbitrator to adjudicate the dispute. The remuneration for the arbitrator was fixed at Rs. 20,000 per sitting, with both parties bearing an equal share of the costs.
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2009 (11) TMI 987
Issues involved: Appeal challenging concurrent findings of Commissioner of Income-Tax (Appeals) and Income-Tax Appellate Tribunal regarding treatment of sum received for supply of liquor as income.
Summary:
1. Assessment Year 1998-99:
The appeal was filed by the Revenue against the findings of the Commissioner of Income-Tax (Appeals) and the Income-Tax Appellate Tribunal regarding the treatment of a sum received for the supply of liquor as income for the assessment year 1998-99.
2. Assessee's Position:
The assessee had received a sum of &8377;75,61,415/- from M/s Blue Mountain Food Products Ltd. for the supply of liquor. The Assessing Officer treated this amount as a benefit accrued to the assessee and made it liable to tax, as M/s Blue Mountain Food Products Ltd. had written off the said amount in its accounts.
3. Appeal and Findings:
The assessee challenged the Assessing Officer's order before the Commissioner of Income-Tax (Appeals), who concluded that the assessee was not aware of the write-off by M/s Blue Mountain Food Products Ltd. The Tribunal also affirmed this decision. The appeal raised questions regarding the treatment of the sum received and whether it could be considered as income u/s the Income Tax Act.
4. Judgment:
The High Court held that if the assessee had knowledge of the write-off by M/s Blue Mountain Food Products Ltd., the Assessing Officer could have treated the amount as income. However, since the assessee was not aware of this, the return filed by the assessee could not be faulted. The Court dismissed the appeal, upholding the decisions of the Tribunal and the Commissioner of Income-Tax (Appeals).
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2009 (11) TMI 986
Issues involved: Appeal against the order of reinstatement of a primary teacher terminated due to mental disability under Section 47 of the Persons with Disabilities Act, 1995.
Summary:
The appellant, a primary teacher, was terminated due to mental disability after being absent from duties without sanctioned leave. The Commissioner of disabled person, u/s 47 of the Act, ordered reinstatement based on evidence of 40-70% mental disability. The respondent challenged this order in a Special Civil Application, which was allowed by the Single Judge due to the appellant's prolonged absence and failure to respond to notices. The appellant's advocate argued disability as the cause for absence, but admitted lapses in presenting necessary documents. The Court found no merit in the appeal and rejected it.
Key Points:
- Appellant terminated for mental disability and absenteeism without sanctioned leave.
- Commissioner ordered reinstatement u/s 47 of the Act based on evidence of mental disability.
- Respondent challenged the order in a Special Civil Application, which was allowed by the Single Judge.
- Appellant's advocate cited disability as the reason for absence but admitted lapses in presenting necessary documents.
- Court rejected the appeal, finding no merit for interference.
- Civil Application disposed of due to the dismissal of the Letters Patent Appeal.
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2009 (11) TMI 985
Issues Involved:
1. Declaration of possession and development rights.
2. Validity of the termination letter dated February 1, 2008.
3. Specific performance of the agreement dated April 23, 2007.
4. Validity and cancellation of the Memorandum of Understanding (MoU) dated April 14, 2008.
5. Interim reliefs and injunctions against creating third-party rights.
6. Appointment of a special officer and formulation of a scheme for management.
7. Appointment of a court receiver.
Issue-wise Detailed Analysis:
1. Declaration of Possession and Development Rights
The plaintiff sought a declaration that Defendant No. 1 is lawfully entitled to remain in possession of the land and develop it for a super specialty hospital. The court noted that Defendant No. 2 was granted a lease by the Government of Maharashtra and had entered into a Joint Venture Agreement (JVA) with Defendants 3 and 4 to form Defendant No. 1 for developing the hospital. However, the title of the land was never transferred to Defendant No. 1, and the project could not be completed due to various reasons, including financial instability. The court found that the intention was not to transfer the title and ownership of the land without completing the legal formalities, including obtaining permission from the Joint Charity Commissioner and the Government of Maharashtra.
2. Validity of the Termination Letter Dated February 1, 2008
The plaintiff challenged the termination of the JVA by Defendant No. 2. The court noted that Defendant No. 2 had terminated the JVA due to non-compliance and inaction by the other parties and had invoked the arbitration clause. The court held that unless the termination notice was declared null and void, the JVA could not be the foundation for the plaintiff's case.
3. Specific Performance of the Agreement Dated April 23, 2007
The plaintiff sought specific performance of an agreement dated April 23, 2007. The court found that the agreement was executed without proper authority, was not duly stamped or registered, and lacked necessary permissions from the Charity Commissioner and the Government of Maharashtra. Therefore, the court held that the plaintiff could not claim specific performance of the agreement.
4. Validity and Cancellation of the MoU Dated April 14, 2008
The plaintiff sought to declare the MoU dated April 14, 2008, as null and void. The court noted that Defendant No. 2 had entered into the MoU with Defendants 22 and 23 after terminating the JVA. The court found that the MoU was a result of the failure to complete the project under the JVA and that the plaintiff could not challenge the MoU without first invalidating the termination of the JVA.
5. Interim Reliefs and Injunctions Against Creating Third-Party Rights
The plaintiff sought various interim reliefs, including injunctions to restrain the defendants from creating third-party rights. The court held that the plaintiff, as a shareholder, could not seek such reliefs on behalf of the company, especially when the company itself had not challenged the actions of the defendants. The court also noted that the balance of convenience and equity lay against granting the interim reliefs sought by the plaintiff.
6. Appointment of a Special Officer and Formulation of a Scheme for Management
The plaintiff sought the appointment of a special officer and the formulation of a scheme for the management of Defendant No. 1. The court found that the company had its own remedies available and that the plaintiff could not seek such reliefs on behalf of the company without proper authorization.
7. Appointment of a Court Receiver
The plaintiff sought the appointment of a court receiver for the land. The court held that the plaintiff could not seek such reliefs without first establishing a prima facie case and obtaining specific performance of the agreement. The court also noted that the completion of the project was of public importance and that delaying it would cause irreparable harm.
Conclusion:
The court dismissed the Notice of Motion, holding that the plaintiff could not seek the reliefs on behalf of the company without proper authorization and that the balance of convenience and equity lay against granting the interim reliefs. The court also observed that the judgment would take effect after two weeks to allow the plaintiff to prefer an appeal.
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2009 (11) TMI 984
Issues Involved:
1. Jurisdiction of the Arbitrator
2. Applicability of the Arbitration Act, 1940 vs. Arbitration and Conciliation Act, 1996
3. Validity and enforceability of the decree passed by the Ratnagiri Court
Summary:
1. Jurisdiction of the Arbitrator:
The petitioner was awarded a contract which was later rescinded by the respondents. The petitioner invoked the arbitration clause and sought the appointment of an arbitrator. The Ratnagiri Court appointed an arbitrator, who passed an award in favor of the petitioner. The respondents challenged the jurisdiction of the arbitrator, but later withdrew their objection and participated in the arbitration proceedings. The award was made a decree by the Ratnagiri Court.
2. Applicability of the Arbitration Act, 1940 vs. Arbitration and Conciliation Act, 1996:
The core issue was whether the arbitration proceedings, which commenced under the Arbitration Act, 1940, should continue under the same Act or under the Arbitration and Conciliation Act, 1996. The Executing Court held that the new Act should apply, rendering the award and decree under the old Act a nullity. However, the petitioner argued that the proceedings should continue under the old Act, citing the Supreme Court's judgment in Milkfood Ltd. v. GMC Ice Cream (P) Ltd., which stated that if arbitration proceedings commenced under the old Act, they could culminate under the same Act even after the new Act came into force.
3. Validity and enforceability of the decree passed by the Ratnagiri Court:
The Executing Court dismissed the execution application, declaring the decree a nullity. The petitioner contended that the arbitration proceedings commenced with the notice dated 06.09.1994, prior to the new Act's enforcement, and thus should be governed by the old Act. The High Court agreed with the petitioner, referencing the Milkfood Ltd. case, and concluded that the arbitration proceedings and subsequent decree were valid and enforceable. The Court also noted that the respondents had substantially satisfied the decree by paying a significant amount, and only a balance amount remained to be recovered.
Conclusion:
The High Court quashed and set aside the Executing Court's order, allowing the petition and making the Rule absolute in terms of prayer Clause (a). The decree passed by the Ratnagiri Court was declared valid and enforceable, with parties bearing their respective costs.
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2009 (11) TMI 983
Jurisdiction of a forum court in suits involving internet related disputes - Infringement of patent of the appellant/plaintiff - jurisdiction of a court to entertain complaint filed - word mark and the device adopted by the Defendants in relation to their retreat is deceptively similar to that of the plaintiff - The plaintiff claims that it is part of a group of companies involved in the hospitality business. Since 1994 it adopted and used the word mark "Banyan Tree and also the banyan tree device. It is claimed that on the account of the extensive and continuous use by the plaintiff of the said mark and device in relation to its business, they have acquired secondary meaning, have become highly distinctive and have come to be associated with the plaintiff and its sister concerns. The plaintiff maintains the websites www.banyantree.com and www.banayantreespa.com since 1996. The said websites are accessible in India.
HELD THAT:- This Court is not able to accept the submission of the learned Counsel for the plaintiff that the test of "purposeful availment" must be replaced by the test of "purposeful avoidance". While the Defendant may in his defence show how he avoided the forum state, the initial burden is on the plaintiff to show that the Defendant "purposefully availed" itself of the jurisdiction of the forum court. The issue of incorporating filters to block access to the website by viewers located outside the forum state will have to be considered while deciding if the Defendant had "purposefully avoided" the forum state. However, that question will arise only if the plaintiff has been able to show that the website of the Defendant is interactive and permits commercial transactions to be concluded by the Defendant with a user of the website.
This Court holds that jurisdiction of the forum court does not get attracted merely on the basis of interactivity of the website which is accessible in the forum state. The degree of the interactivity apart, the nature of the activity permissible and whether it results in a commercial transaction has to be examined.
For the "effects" test to apply, the plaintiff must necessarily plead and show prima facie that the specific targeting of the forum state by the Defendant resulted in an injury or harm to the plaintiff within the forum state.
For the purposes of a passing off or an infringement action (where the plaintiff is not located within the jurisdiction of the court), the injurious effect on the plaintiffs business, goodwill or reputation within the forum state as a result of the Defendants website being accessed in the forum state would have to be shown.
Naturally therefore, this would require the presence of the plaintiff in the forum state and not merely the possibility of such presence in the future. Secondly, to show that an injurious effect has been felt by the plaintiff it would have to be shown that viewers in the forum state were specifically targeted. Therefore the "effects" test would have to be applied in conjunction with the "sliding scale" test to determine if the forum court has jurisdiction to try a suit concerning internet based disputes. The question No. (i) is accordingly answered.
Extent of burden of proof on the plaintiff to prima facie show that the Defendant has purposefully availed of the jurisdiction of this Court - This Court holds that in order to prima facie establish that the Defendant purposefully availed of the jurisdiction of this Court, the plaintiff would have to show that the Defendant engaged in some commercial activity in the forum State by targeting its website specifically at customers within that State.
A mere hosting of a website which can be accessible from anyone from within the jurisdiction of the court is not sufficient for this purpose. Also a mere posting of an advertisement by the Defendant depicting its mark on a passive website which does not enable the Defendant to enter into any commercial transaction with the viewer in the forum state cannot satisfy the requirement of giving rise to a cause of action in the forum state. Even an interactive website, which is not shown to be specifically targeted at viewers in the forum state for commercial transactions, will not result in the court of the forum state having jurisdiction.
In sum, for the purposes of Section 20(c) CPC, in order to show that some part of the cause of action has arisen in the forum state by the use of the internet by the Defendant, the plaintiff will have to show prima facie that the said website, whether euphemistically termed as "passive plus" or "interactive", was specifically targeted at viewers in the forum state for commercial transactions. The plaintiff would have to plead this and produce material to prima facie show that some commercial transaction using the website was entered into by the Defendant with a user of its website within the forum state and that the specific targeting of the forum state by the Defendant resulted in an injury or harm to the plaintiff within the forum state. Question No. (ii) is answered accordingly.
Permissibility for the plaintiff to establish such prima facie case through "trap orders" or "trap transactions" - A lone trap transaction will not be sufficient evidence of infringement or passing off. For the purposes of establishing that a part of the cause of action arose within the jurisdiction of the court, the plaintiff would have to show that the Defendant has purposefully availed of the jurisdiction of the forum court by entering into a commercial transaction with an internet user located within the jurisdiction of the forum court. This cannot possibly be a solitary trap transaction since that would not be an instance of "purposeful" availment by the Defendant. It would have to be a real commercial transaction that the Defendant has with someone not set up by the plaintiff itself. If the only evidence is in the form of a series of trap transactions, they have to be shown to be obtained using fair means. The plaintiff seeking to establish jurisdiction on the basis of such trap transactions would have to aver unambiguously in the plaint, and also place along with it supporting material, to prima facie show that the trap transactions relied upon satisfy the above test. Question (iii) is answered accordingly.
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2009 (11) TMI 981
Issues Involved:
1. Challenge to the order u/s 34 of the Arbitration and Conciliation Act, 1996.
2. Application by respondents to not deposit US$ 300,000 in court.
3. Scope of the arbitration agreement and the appeal.
4. Review/recall of the court's order directing deposit of US$ 300,000.
5. Allegation that the amount of US$ 550,000 was not received by respondents.
6. Argument of waiver u/s 4 of the Arbitration and Conciliation Act.
7. Court's inherent powers and jurisdiction to pass interim orders.
Summary:
1. Challenge to the order u/s 34 of the Arbitration and Conciliation Act, 1996:
The appellant filed an appeal u/s 37(1)(b) of the Arbitration and Conciliation Act, 1996, challenging the order dated 29.02.2008, whereby the learned Single Judge allowed objections u/s 34 of the Act and set aside the arbitrator's award made in favor of the appellant.
2. Application by respondents to not deposit US$ 300,000 in court:
Respondent Nos. 1 and 2 filed an application to be excused from depositing US$ 300,000 or its equivalent in rupees in compliance with the court's order dated 12.01.2009, as corrected on 06.02.2009.
3. Scope of the arbitration agreement and the appeal:
The arbitration agreement dated 29.08.2009 specified the distribution of sale proceeds of US$ 550,000 from the sale of a house in Kabul. The agreement required US$ 300,000 to be kept with Harinder Singh and US$ 250,000 with Kirat Singh until the arbitration/settlement of accounts.
4. Review/recall of the court's order directing deposit of US$ 300,000:
The court's order dated 12.01.2009, corrected on 06.02.2009, directed the respondents to deposit US$ 300,000 in court. The respondents sought a review/recall of this order, claiming they never received the amount of US$ 550,000.
5. Allegation that the amount of US$ 550,000 was not received by respondents:
Respondents claimed that the amount of US$ 550,000 was never received by them and was lying with an estate agent in Kabul. They argued that this information was not presented to the court when the order was passed.
6. Argument of waiver u/s 4 of the Arbitration and Conciliation Act:
Respondents argued that the appellant waived his right to require the deposit of US$ 300,000 by participating in the arbitration proceedings without objection, despite knowing that the amount was not kept in custody as per the arbitration agreement.
7. Court's inherent powers and jurisdiction to pass interim orders:
The court held that it had the jurisdiction to pass the order dated 12.01.2009, as corrected on 06.02.2009, under Section 9 of the Act and inherent powers u/s 94 read with Section 151 CPC to ensure justice and prevent the ends of justice from being defeated.
Conclusion:
The court dismissed the respondents' application with costs of Rs. 50,000 to be paid to the appellant within two weeks, affirming that the respondents had received the amount of US$ 550,000 and were required to deposit US$ 300,000 in court. The court found no merit in the respondents' claims and upheld the original order.
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2009 (11) TMI 980
Issues involved: Adjudication of a Show-cause notice resulting in demand of duty, penalty imposition, denial of natural justice, failure to consider case law cited.
The judgment by the Appellate Tribunal CESTAT, MUMBAI involved the confirmation of a demand of duty against the appellant under the proviso to Section 11A (1) of Central Excise Act, along with interest u/s 11AB, and imposition of penalty u/s Rule 25 of the Central Excise Rules, 2002. The appellant's appeal against the order of adjudication, which was rejected by the Commissioner (Appeals), was the subject of the present appeal.
The appellant did not have any representation during the proceedings, while the respondent was represented by the JDR.
The learned JDR highlighted that a significant portion of the Show-cause notice was not presented by the appellant, which was later produced during the proceedings.
The case revolved around allegations of clandestine removal of excisable goods by the appellant, based on statements of Shri Umesh V. Modi and original records seized. The original authority and appellate authority relied on these materials to conclude that the appellant had indeed engaged in clandestine activities. However, the appellant contested the allegations, questioning the reliability of the evidence and requesting to cross-examine Shri Umesh Modi and inspect the original records. The appellate authority upheld the original authority's decision without proper scrutiny or consideration of the appellant's grievances, including denial of natural justice and failure to consider relevant case law.
In light of the circumstances, the Tribunal allowed the appeal by way of remand, setting aside the lower authorities' orders. The original authority was directed to re-adjudicate the matter, ensuring the appellant's right to cross-examine Shri Umesh Modi and obtain certified extracts from the original records. The appellant was to be given a fair opportunity to present their case in accordance with the principles of natural justice.
Therefore, the appeal was allowed by way of remand, emphasizing the importance of upholding natural justice and considering all relevant aspects of the case law cited by the appellant.
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2009 (11) TMI 979
Issues Involved:
1. Whether the appellants are guilty of insider trading.
2. Timing of the sale transactions of TFL shares.
3. Validity of contract notes and other supporting documents.
4. Procedural compliance and reporting of transactions to the stock exchange.
5. Degree of proof required to establish insider trading.
Issue-wise Detailed Analysis:
1. Whether the appellants are guilty of insider trading:
The primary question was whether the appellants engaged in insider trading. The whole time member of the Securities and Exchange Board of India (SEBI) had found the appellants guilty and restrained them from accessing the securities market for five years. Additionally, the adjudicating officer imposed a monetary penalty of Rs. 5 lakhs on each appellant under Section 15G of the SEBI Act, 1992. The appellants contended that the transactions in question occurred in September 2000, a period when they were not in possession of unpublished price-sensitive information.
2. Timing of the sale transactions of TFL shares:
The appellants argued that the sale transactions by Mrs. Anuradha S. Pendse and Nalini Properties Private Limited took place on September 11, 2000, while SEBI contended that the transactions occurred between March 28 and March 31, 2001. The appellants provided contract notes dated September 11, 2000, and other supporting documents to substantiate their claim. The Board's investigation revealed that the appellant was in possession of unpublished price-sensitive information by March 2001, and thus, any transactions during this period would constitute insider trading.
3. Validity of contract notes and other supporting documents:
The appellants produced contract notes in Form B issued by the Broker on September 11, 2000, indicating that the transactions were executed on a principal-to-principal basis. The contract notes were reported to the Bombay Stock Exchange (BSE) on September 16, 2000, which was acknowledged by the BSE on September 19, 2000. The whole time member doubted the validity of these contract notes, citing reasons such as handwritten sub-serial numbers and alleged contradictions in the notes. However, the appellate tribunal found these reasons unconvincing and upheld the authenticity of the contract notes.
4. Procedural compliance and reporting of transactions to the stock exchange:
The Broker reported the transactions to the BSE with a delay of eight days, which led to disciplinary action by the BSE's Disciplinary Action Committee. The committee, chaired by a former judge of the Bombay High Court, acknowledged the delay in reporting and settlement but did not find any fraudulent intent. The appellate tribunal noted that the BSE's acknowledgment and the disciplinary action taken against the Broker supported the appellants' claim that the transactions occurred in September 2000.
5. Degree of proof required to establish insider trading:
The tribunal emphasized that insider trading is a serious charge requiring a high degree of proof. It referred to established legal principles that the more serious the offense, the stricter the degree of proof required. The tribunal found that the whole time member failed to establish the charge of insider trading with the necessary degree of probability. The tribunal highlighted that the entire material produced by the appellants, including contract notes, ledger accounts, and BSE's acknowledgment, supported the claim that the transactions were executed in September 2000.
Conclusion:
The appellate tribunal concluded that the appellants were not guilty of insider trading. It held that the sale transactions took place in September 2000, a period when the appellants were not in possession of unpublished price-sensitive information. The tribunal set aside the impugned orders and allowed the appeals, leaving the parties to bear their own costs.
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2009 (11) TMI 978
Issues involved: Appellants imported goods without reflecting some in Bills of Entry, leading to non-payment of duty. Adjudication involved imposition of duty, redemption fine, and penalty under Section 114A of the Customs Act, 1962.
The judgment by the Appellate Tribunal CESTAT CHENNAI involved a case where the appellants imported goods during February 1999 to April 2000, failing to reflect some in the Bills of Entry and not paying duty on them. Upon discovering this, the appellants voluntarily informed the Chief Commissioner and paid the duty along with interest. The adjudicating Commissioner imposed a duty amount of &8377; 54,37,268/-, a redemption fine of &8377; 3 lakhs, and a penalty of &8377; 13,59,370/- under Section 114A of the Customs Act, 1962.
The counsel for the appellants argued that as the disclosure was voluntary without prior detection by the Department, and there was no intention to evade duty or deliberate suppression, Section 114A of the Customs Act should not apply. Mention was made of other cases where nominal redemption fines and lesser penalties were imposed for similar voluntary disclosures under Section 112A of the Customs Act, 1962.
After hearing both sides, the Tribunal concluded that Section 114A of the Customs Act was not applicable in this case due to the voluntary disclosure by the appellants. They had paid the duty and interest for the omitted goods voluntarily. The Tribunal noted that a previous case adjudicated by the Commissioner of Customs imposed a redemption fine of &8377; 2.50 lakhs and a penalty of &8377; 50,000/- under Section 112A for a similar duty amount. The Tribunal confirmed the redemption fine of &8377; 3 lakhs but set aside the penalty under Section 114A, instead imposing a penalty of &8377; 1,00,000/- under Section 112A. The appeal was rejected.
This judgment highlights the importance of voluntary disclosure in customs cases and the application of specific penal provisions under the Customs Act based on the circumstances of each case.
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