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2012 (10) TMI 1281
1. ISSUES PRESENTED and CONSIDERED The core legal questions considered in this judgment are: - Whether the Delhi High Court has the territorial jurisdiction to entertain the writ petition challenging the orders of the Revisional Authority and the State Government of Maharashtra.
- What constitutes the appropriate forum for challenging orders of a pan India tribunal, such as the Revisional Authority under the Mines and Minerals (Development and Regulation) Act, 1957 (MMDR Act).
- How the principle of forum conveniens applies in determining the jurisdiction of a High Court in cases involving multiple states.
2. ISSUE-WISE DETAILED ANALYSIS Issue 1: Territorial Jurisdiction of the Delhi High Court - Relevant Legal Framework and Precedents:
- The MMDR Act and the principle of territorial jurisdiction as interpreted in various cases, including Ambica Industries and Sterling Agro Industries Ltd.
- Precedents from cases involving the Income Tax Act and the Central Excise Act, where jurisdiction was determined by the location of the original authority.
- Court's Interpretation and Reasoning:
- The court emphasized that the situs of the tribunal is not determinative of jurisdiction. Instead, the jurisdiction should be based on the location of the original authority.
- The court referred to the principle of forum conveniens, which allows a court to refrain from exercising jurisdiction if a substantive part of the cause of action arises outside its territorial jurisdiction.
- Key Evidence and Findings:
- The petitioner challenged orders from the Revisional Authority in Delhi and the State Government of Maharashtra.
- There were multiple applicants from various states, indicating a potential for conflicting orders if different High Courts were approached.
- Application of Law to Facts:
- The court applied the principle that the High Court with jurisdiction over the original authority (State Government of Maharashtra) is the appropriate forum.
- Treatment of Competing Arguments:
- The petitioner argued that the presence of the Revisional Authority in Delhi granted jurisdiction to the Delhi High Court. The court rejected this, citing the need to avoid forum shopping and conflicting judgments.
- Conclusions:
- The Delhi High Court declined to entertain the writ petition, directing the petitioner to approach the appropriate High Court with jurisdiction over the original authority.
3. SIGNIFICANT HOLDINGS - Verbatim Quotes of Crucial Legal Reasoning:
- "The principle of forum conveniens in its ambit and sweep encapsulates the concept that a cause of action arising within the jurisdiction of the Court would not itself constitute to be the determining factor compelling the Court to entertain the matter."
- "The situs of the Tribunal is not necessarily determinative of the fact as to whether the High Court in which the writ petition is preferred is the convenient forum before which the litigant ought to agitate his grievance."
- Core Principles Established:
- The jurisdiction of a High Court in cases involving pan India tribunals should be determined by the location of the original authority, not the tribunal's location.
- The principle of forum conveniens should guide the exercise of jurisdiction, considering the potential for conflicting judgments and forum shopping.
- Final Determinations on Each Issue:
- The Delhi High Court lacks jurisdiction to entertain the writ petition as the substantive cause of action arose in Maharashtra.
- The petitioner is advised to seek recourse in the High Court with jurisdiction over the State Government of Maharashtra.
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2012 (10) TMI 1280
The High Court of Bombay stayed the public auction of precious items by Shri Sai Baba Sansthan Trust and directed the trust to inform the court's decision on its website and in newspapers. The court also prohibited the trust committee from making major financial decisions without court permission and from creating third-party interests in trust properties. The committee was instructed to secure the precious items properly.
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2012 (10) TMI 1279
Issues Involved:
1. Compliance with the definition of "Demerger" under Section 2(19AA) of the Income Tax Act, 1961.
2. Alleged avoidance of Stamp Duty under the Bombay Stamp Act, 1958.
Issue-wise Detailed Analysis:
1. Compliance with the Definition of "Demerger" under Section 2(19AA) of the Income Tax Act, 1961:
The primary issue raised by the Regional Director was that the proposed Scheme does not fall under the purview of the definition of "Demerger" as per Section 2(19AA) of the Income Tax Act, 1961. The petitioners argued that the transfer of property along with liabilities and Undertaking falls within the purview of Section 2(19AA) of the Income Tax Act, 1961, making it a valid Scheme of Demerger as per the Companies Act. The petitioners further contended that the definition of "Demerger" under the Income Tax Act is specific to that Act and should not be read into Sections 391 to 394 of the Companies Act, which allow for arrangements in the form of Demerger of an "Undertaking" as well as property. The Court referred to judgments from the Delhi High Court and its own Division Bench, which supported the view that compliance with Section 2(19AA) is not a pre-requisite for sanctioning a Scheme of Arrangement under the Companies Act. The Court concluded that the observation regarding non-compliance with Section 2(19AA) is not valid, as the definition under the Income Tax Act is relevant only for determining tax neutrality and not as a mandatory requirement for all Schemes under the Companies Act.
2. Alleged Avoidance of Stamp Duty under the Bombay Stamp Act, 1958:
The second observation made by the Regional Director was regarding the purported avoidance of Stamp Duty. The Regional Director suggested that the transfer of Undertaking III to the Resulting Company No.2 was an attempt to avoid Stamp Duty by transferring immovable property under the Court's order. The petitioners countered this by stating that the Scheme did not intend to avoid Stamp Duty and that they would pay the duty in accordance with the law. The Court noted that the petitioners had committed to paying Stamp Duty as required under the Bombay Stamp Act, 1958, which sufficiently addressed the Regional Director's concerns. The Court found no justifiable reason to reject the Scheme based on this observation.
Conclusion:
After considering the entirety of the facts, submissions, and relevant judgments, the Court determined that the observations made by the Regional Director did not provide a valid basis to reject the Scheme. The Court found no evidence that the Scheme was non-compliant with the Companies Act, 1956, or against the interests of the Shareholders, Creditors, or the public. The Court sanctioned the Scheme, allowing the prayers made in the respective petitions, and directed the payment of costs to the Central Government Counsel.
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2012 (10) TMI 1278
Issues:
Validity of assessment order under section 153D of the Income Tax Act.
Addition made on account of unexplained expenditure of Interest and Brokerages under section 69D of the Income Tax Act.
Analysis:
1. Validity of assessment order under section 153D of the Income Tax Act:
The appeals were filed by the assessee and the revenue against the order of the CIT(A)-II, Pune for Assessment Year 2004-05. The assessee contended that the assessment order was in violation of section 153D of the Income Tax Act, rendering it null and void. The key argument was the lack of prior approval of the Joint Commissioner of Income Tax (JCIT) before passing the assessment order. The Tribunal referred to a previous decision in a similar case and held that obtaining approval of the JCIT is a mandatory requirement, not procedural. As no such approval was obtained in the present case, the assessment order was deemed invalid and void ab-initio. Consequently, the grounds raised by both the assessee and the revenue on this issue were dismissed as academic, with the appeal filed by the assessee being allowed and the appeal filed by the revenue being dismissed.
2. Addition made on account of unexplained expenditure of Interest and Brokerages under section 69D of the Income Tax Act:
The revenue raised grounds challenging the deletion of additions made by the Assessing Officer under section 69D of the Income Tax Act. The revenue contended that the CIT(A) erred in deleting the additions related to borrowal transactions that had the attributes of a 'Hundi'. The revenue argued that a broader interpretation of 'Hundi' was required under section 69D, considering the modus operandi of the transactions. However, the Tribunal upheld the CIT(A)'s decision, stating that the seized documents did not qualify as 'Hundi' under the narrow interpretation of the term. The Tribunal found no justification for the additions made by the Assessing Officer and affirmed the CIT(A)'s decision to delete them. The revenue's grounds on this issue were dismissed, and the additions were deleted.
In conclusion, the Tribunal's judgment addressed the issues of the validity of the assessment order under section 153D and the addition made on account of unexplained expenditure of Interest and Brokerages under section 69D, ruling in favor of the assessee on both counts.
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2012 (10) TMI 1277
The Supreme Court directed the release of the petitioner on bail after being in jail for over five years and three months in a case related to the killings of Sohrabuddin and his wife Kauserbi. Bail bond of Rs.1,00,000/- with two sureties of the like amount each was required for his release. The grant of bail to the petitioner would not impact the consideration of bail for other accused in the case.
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2012 (10) TMI 1276
Issues Involved:
1. Quashing of criminal proceedings u/s 482 Code of Criminal Procedure.
2. Establishment of offence u/s 306 Indian Penal Code.
3. Determination of 'instigation' and 'mens rea' in abetment to suicide cases.
Summary:
1. Quashing of Criminal Proceedings u/s 482 Code of Criminal Procedure:
The appellant sought to quash the criminal proceedings initiated based on FIR No. 285 of 2005, chargesheet No. 208/2005, and the order of cognizance dated 28.4.2006 by the Chief Judicial Magistrate, Haridwar. The High Court of Uttarakhand dismissed the application u/s 482 Code of Criminal Procedure, leading to the present appeal.
2. Establishment of Offence u/s 306 Indian Penal Code:
The appellant was charged u/s 306 Indian Penal Code for allegedly abetting the suicide of Anurag Singh. The deceased's brother lodged an FIR alleging persistent harassment and illegal demands by the appellant, which led to the deceased's suicide. The investigation revealed a suicide note blaming the appellant, and statements from the deceased's family corroborated the harassment claims. The appellant argued that the facts did not constitute an offence u/s 306 Indian Penal Code, emphasizing the need for mens rea and the magnitude of cruelty to drive someone to suicide.
3. Determination of 'Instigation' and 'Mens Rea' in Abetment to Suicide Cases:
The court examined precedents to determine 'instigation' and 'mens rea' in abetment to suicide cases. It referred to cases like Swamy Prahaladdas v. State of M.P., Sanju @ Sanjay Singh Sengar v. State of M.P., and Madan Mohan Singh v. State of Gujarat, where casual remarks or isolated incidents were deemed insufficient to constitute abetment. However, in the present case, the court found persistent harassment and humiliation by the appellant, coupled with the utterance that "had there been any other person in his place, he would have certainly committed suicide," distinguished it from previous cases. The court held that the circumstances created a situation where the deceased felt compelled to commit suicide.
Conclusion:
The Supreme Court dismissed the appeal, upholding the High Court's decision not to quash the chargesheet and criminal proceedings against the appellant. The court clarified that the observations made would not affect the appellant's rights during the trial.
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2012 (10) TMI 1275
Issues involved: Suit not proceeding due to defendant being a sick company under SICA, requirement of prior permission u/s 22 of SICA for continuing with the suit.
Issue 1: Requirement of prior permission under Section 22 of SICA
The judgment refers to a Division Bench judgment of the Supreme Court in the case of Raheja Universal Limited Vs. NRC Limited and Ors. (2012) 4 SCC 148, which clarifies that proceedings requiring prior permission under Section 22 of SICA are those in the nature of execution, distress, or similar actions that may lead to the liquidation of assets of a sick company. Not every suit for recovery automatically falls under this provision, only those suits that may result in the liquidation of assets are affected by Section 22 of SICA.
Issue 2: Suit for recovery of money not requiring prior permission
In the present case, the suit is for the recovery of money without any threat to the liquidation of the assets of the sick company. The plaintiff's counsel does not press for interim applications under the Code of Civil Procedure. Therefore, as there is no risk to the company's assets, no prior permission is needed under Section 22 of SICA. Consequently, the suit can proceed without the permission of BIFR/AAIFR.
Conclusion
The judgment allows the suit to proceed without the need for prior permission under Section 22 of SICA, as it is a simple suit for the recovery of money without posing a threat to the assets of the sick company. The defendant is directed to file the written statement within six weeks, and further procedural steps are outlined for the progression of the case. The matter is scheduled for the framing of issues in January 2013, marking of exhibits, and other necessary steps to move the case forward.
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2012 (10) TMI 1274
Issues Involved:
1. Validity of invoking general statute (IPC) when a special statute (VAT Act) exists.
2. Authority of police to investigate offences u/s 77 of the VAT Act.
3. Requirement of assessment completion before FIR registration.
4. Specific allegations against directors for their role in company affairs.
Summary:
1. Validity of Invoking General Statute (IPC) When a Special Statute (VAT Act) Exists:
The petitioners challenged the registration of FIR No. 139/2012 for offences under IPC Sections 406, 409, 420, 465, 471, 468, 120-B, 34, and various sections of the Maharashtra Value Added Tax Act, 2002. They argued that when a special statute exists, the provisions of the general statute (IPC) cannot be invoked. The court referred to the Apex Court's judgment in the case of State of W.B. vs. Narayan K. Patodia, which held that offences under the IPC do not get displaced by the special statute. The court concluded that the offences under IPC Sections 465 and 471 are not covered by the VAT Act, thus justifying the invocation of the IPC.
2. Authority of Police to Investigate Offences u/s 77 of the VAT Act:
The petitioners contended that u/s 77 of the VAT Act, the investigation cannot be entrusted to the police. The court examined Section 77, which allows the Commissioner to authorize any subordinate officer to investigate offences under the Act, and such officers can exercise the powers of a police officer. The court found that there is no prohibition in the VAT Act against police investigation. The court relied on the Apex Court's judgment in State of W.B. vs. Narayan K. Patodia, which allowed police investigation in the absence of a statutory prohibition, and held that the police can investigate offences under both the VAT Act and IPC.
3. Requirement of Assessment Completion Before FIR Registration:
The petitioners argued that an FIR can only be registered after tax assessment is completed. The court found no merit in this argument, stating that neither the VAT Act nor the Cr.P.C. supports such a proposition. The court emphasized that the FIR sets the investigation machinery into motion and does not require prior assessment completion.
4. Specific Allegations Against Directors for Their Role in Company Affairs:
The applicant claimed there were no specific allegations against him regarding his role in the company's day-to-day affairs. The court noted that FIRs are not required to be encyclopedic and only need to initiate the investigation. The court referred to the Apex Court's judgment in Ashabai Machindra Adhagale vs. State of Maharashtra, which stated that the FIR need not contain all details. The court held that the investigation would determine the specific roles and that the applicant could seek discharge if no material is found against him. The court dismissed the application, stating that the investigation cannot be thwarted at the beginning.
Conclusion:
The writ petition and the application were dismissed as both were found to be without merit. The court upheld the validity of invoking IPC provisions alongside the VAT Act, allowed police investigation under the VAT Act, rejected the need for assessment completion before FIR registration, and dismissed the challenge regarding the lack of specific allegations against the director.
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2012 (10) TMI 1273
Issues Involved:
1. Rejection of bail for offences u/s 302, 201, and 120-B of IPC and u/s 25(1)(b) and 27 of the Arms Act.
2. Allegations of conspiracy and involvement in the murder of an RTI activist.
3. Considerations for granting bail in non-bailable offences.
4. High Court's direction for further investigation by CBI.
Summary:
Issue 1: Rejection of Bail
The appellant, accused No. 4, challenged the High Court of Gujarat's order rejecting his bail application for offences u/s 302, 201, and 120-B of the IPC and u/s 25(1)(b) and 27 of the Arms Act. The appellant argued that his name was not mentioned in the FIR, he had no nexus with the crime, and the allegations were vague and aimed at tarnishing his public image. Despite these contentions, the trial judge and subsequently the High Court declined to grant bail.
Issue 2: Allegations of Conspiracy
The prosecution alleged that the appellant conspired with other accused to murder the deceased, an RTI activist, due to his exposure of illegal activities. The appellant was accused of financing the contract killer and providing fake SIM cards. The High Court found prima facie evidence of conspiracy based on the frequent visits of accused No. 1 to the appellant's office and a telephonic conversation with the absconding sharp-shooter.
Issue 3: Considerations for Granting Bail
The Supreme Court referred to established principles for granting bail in non-bailable offences, emphasizing the nature and seriousness of the offence, character of the evidence, and potential for the accused to tamper with evidence. The Court cited precedents that highlight the need for a prima facie case and reasonable grounds for believing the prosecution's case.
Issue 4: High Court's Direction for Further Investigation by CBI
The High Court of Gujarat expressed dissatisfaction with the initial investigation, describing it as perfunctory and influenced by a high-ranking police officer. It ordered a comprehensive investigation by the CBI, emphasizing the need for an independent probe to inspire public confidence. The Supreme Court noted this development and decided that it would be inappropriate to grant bail while the CBI investigation is pending. The appellant was granted liberty to file a fresh bail application if the High Court's order is annulled or after the CBI submits its report.
Conclusion:
The Supreme Court disposed of the appeal, emphasizing that the direction for a CBI investigation necessitates withholding bail at this stage. The appellant retains the right to seek bail post-investigation or if the High Court's order is overturned.
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2012 (10) TMI 1272
Issues Involved:
The appeal concerns the disallowance of expenses u/s 14A of the Income Tax Act, 1961 related to dividend income earned by the assessee during assessment year 2008-09.
Issue 1: Disallowance of Expenses u/s 14A
The Revenue challenged the order of the Commissioner of Income-tax (Appeals)-II, Ludhiana, which deleted the disallowance of Rs.12,79,001/- made by the Assessing Officer u/s 14A of the Act. The Revenue contended that expenses like Management Fee and other charges directly related to earning of dividend income should be disallowed. The Revenue argued that even if the assessee carries on the business of Sale & Purchase of shares and earns dividend income as business income, expenses attributable to such income are liable to be disallowed u/s 14A of the Act.
Issue 2: Assessment of Income
The assessee declared total income of Rs.36,56,846/- for the year, including income from Salary, House Property, Business, and Other Sources. The income from business was detailed, showing profits accrued on Portfolio Management Service (PMS) transactions with specific amounts from Kotak Securities and ICICI Prudential. The assessee claimed total expenditure of Rs.12,79,001/- on management fee/NSDL charges from the profits on PMS transactions.
Judgment:
After considering the contentions and perusing the record, it was noted that the assessee declared profits from PMS transactions as business income and claimed expenditure related to such earnings. The only expenditure claimed was the management fee and NSDL charges paid to the portfolio management service. The Revenue conceded that the assessee is entitled to expenditure related to earning business income. However, the Assessing Officer disallowed the expenditure as income of the assessee, which was later deleted by the CIT (Appeals).
In compliance with section 14A read with Rule 8D of the Act, it was directed to disallow Rs.5000/- as expenditure related to earning dividend income. This decision was specific to the facts of the case and not a precedent. Therefore, the appeal of the Revenue was partly allowed, and the order was pronounced on October 31, 2012.
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2012 (10) TMI 1271
Issues Involved:
1. Reopening of assessment u/s 148 for AY 2005-06.
2. Allowability of additional depreciation u/s 32(1)(iia).
3. Levy of interest u/s 234B and 234C.
4. Allowability of foreign travel expenditure for AY 2008-09.
Summary:
1. Reopening of Assessment u/s 148 for AY 2005-06:
The first issue pertains to the reopening of the assessment. The original assessment was completed u/s 143(3) on 26.12.2007, and a notice u/s 148 was issued on 24.3.2009. The reason for reopening was the disallowance of additional depreciation on machinery, as the assessee was not engaged in manufacturing any article or thing. The CIT(A) confirmed the reopening and the addition made by the Assessing Officer. The assessee argued that all information was available during the original assessment, and no fresh tangible material justified reopening. However, the Tribunal upheld the reopening, citing that the Assessing Officer had valid reasons based on the Tribunal Pune Special Bench's decision in B.G. Chitale v. DCIT, which stated that pasteurisation and standardisation of milk do not amount to production.
2. Allowability of Additional Depreciation u/s 32(1)(iia):
The assessee claimed additional depreciation on machinery used for pasteurisation and standardisation of milk, arguing it was part of the manufacturing process of curd and ghee. The Tribunal disagreed, stating that standardisation and pasteurisation are different from manufacturing curd and ghee. The machinery used for these processes does not qualify for additional depreciation u/s 32(1)(iia). The Tribunal referenced the Pune Special Bench decision in B.G. Chitale, which held that these processes do not constitute manufacturing. Consequently, the Tribunal denied the additional depreciation claim.
3. Levy of Interest u/s 234B and 234C:
The issue of interest u/s 234B and 234C was deemed consequential and mandatory. The Tribunal dismissed this ground, aligning with the statutory provisions.
4. Allowability of Foreign Travel Expenditure for AY 2008-09:
The assessee claimed foreign travel expenditure of Rs. 20,35,971. The Assessing Officer disallowed 80% of this amount due to the lack of bifurcation between business and pleasure trips. The CIT(A) adjusted this to a 2/3 disallowance. The Tribunal remitted the issue back to the Assessing Officer, directing the assessee to provide a bifurcation of expenses. If the assessee fails to furnish the details, the Assessing Officer is to follow the CIT(A)'s order.
Conclusion:
In ITA No. 20/Hyd/2012, the appeal was dismissed, and in ITA No. 1828/Hyd/2011, the appeal was partly allowed for statistical purposes. The order was pronounced in the open court on 5th October, 2012.
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2012 (10) TMI 1270
1. ISSUES PRESENTED and CONSIDERED The judgment primarily revolves around the following legal issues: - Whether the petition under Section 34 of the Arbitration and Conciliation Act, 1996, is maintainable for setting aside a foreign arbitral award when the seat of arbitration is outside India.
- Whether the claims made by NNR Global Logistics were barred by limitation under Indian law or Malaysian law.
- Whether the award of compound interest and costs was justified and consistent with public policy in India.
- Whether the enforcement of the foreign arbitral award is contrary to the public policy of India under Section 48 of the Act.
2. ISSUE-WISE DETAILED ANALYSIS Issue 1: Maintainability of the Petition under Section 34 - Relevant Legal Framework and Precedents: The court examined the applicability of Part I of the Arbitration and Conciliation Act, 1996, in light of the Supreme Court's decisions in Bhatia International and Bharat Aluminium Co. v. Kaiser Aluminium Technical Service, Inc.
- Court's Interpretation and Reasoning: The court noted that the decision in Bharat Aluminium Co. would apply prospectively to arbitration agreements executed after 6th September 2012. Therefore, the petition under Section 34 was maintainable for agreements executed before this date.
- Conclusions: The petition by Aargus under Section 34 was maintainable as the arbitration agreement was executed before the prospective application of the Bharat Aluminium Co. decision.
Issue 2: Limitation of NNR's Claims - Relevant Legal Framework and Precedents: The court considered the Indian Limitation Act, 1963, and the Malaysian Limitation Act, 1953, to determine the applicable law of limitation.
- Court's Interpretation and Reasoning: The court upheld the arbitrator's decision that the limitation law is procedural and thus the Malaysian Limitation Act applied, providing a six-year limitation period.
- Key Evidence and Findings: The court noted that the parties maintained a running account and periodic reconciliation, which influenced the limitation analysis.
- Conclusions: NNR's claims were within the limitation period under Malaysian law.
Issue 3: Award of Compound Interest and Costs - Relevant Legal Framework and Precedents: The court referred to the Supreme Court's decision in Renusagar Power Co. Ltd. v. General Electric Co. regarding the award of compound interest.
- Court's Interpretation and Reasoning: The court found that the award of compound interest was not opposed to the public policy of India.
- Conclusions: The award of compound interest and costs was justified and consistent with public policy in India.
Issue 4: Enforcement of the Foreign Award - Relevant Legal Framework and Precedents: The court examined Section 48 of the Arbitration and Conciliation Act, 1996, which deals with the enforcement of foreign awards.
- Court's Interpretation and Reasoning: The court emphasized the discretionary nature of refusing enforcement only when it is contrary to the public policy of India.
- Conclusions: The enforcement of the foreign award was not contrary to the public policy of India, and objections to its enforcement were rejected.
3. SIGNIFICANT HOLDINGS - Core Principles Established: The judgment reinforced the principle that the law of limitation is procedural and the curial law is determined by the seat of arbitration. It also affirmed the discretionary power of courts in enforcing foreign awards under Section 48.
- Final Determinations on Each Issue:
- The petition under Section 34 was maintainable.
- NNR's claims were not barred by limitation under Malaysian law.
- The award of compound interest was justified.
- The enforcement of the foreign award was not contrary to public policy in India.
The judgment concluded with the dismissal of O.M.P. No. 201 of 2012 and the rejection of Aargus's objections in O.M.P. No. 61 of 2012, with costs awarded to NNR.
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2012 (10) TMI 1269
Issues Involved:
1. Compliance with Vishaka Guidelines.
2. Amendments in Civil Services Conduct Rules and Standing Orders.
3. Formation and Functioning of Complaints Committees.
4. Implementation of Vishaka Guidelines by Various States and Union Territories.
5. Directions for Future Compliance and Legislative Enactment.
Summary:
Compliance with Vishaka Guidelines:
The judgment highlights that despite the guidelines laid down in Vishaka v. State of Rajasthan (1997) 6 SCC 241 for the prevention and redressal of sexual harassment at workplaces, many women still struggle to have their most basic rights protected. The statutory law is not yet in place, and the Protection of Women Against Sexual Harassment at Workplace Bill, 2010 is still pending in Parliament.
Amendments in Civil Services Conduct Rules and Standing Orders:
The Supreme Court noted that several states have not made necessary amendments in their Civil Services Conduct Rules and Standing Orders as directed in Vishaka. For instance, states like Goa, Gujarat, Himachal Pradesh, and Orissa have not made these amendments. The court emphasized that the amendments should ensure that the report of the Complaints Committee is treated as an inquiry report under the CCS Rules.
Formation and Functioning of Complaints Committees:
The judgment observed that several states have not constituted Complaints Committees as per the Vishaka guidelines. For example, Rajasthan, Meghalaya, Himachal Pradesh, Assam, and Jammu and Kashmir have not formed such committees. Some states have constituted only one Complaints Committee for the entire state, which is inadequate.
Implementation of Vishaka Guidelines by Various States and Union Territories:
The court reviewed affidavits from various states and union territories, noting significant non-compliance. For instance, the Union Territories of Andaman and Nicobar Islands, Daman and Diu, Lakshadweep, Dadra and Nagar Haveli, and Puducherry have not made amendments in the Standing Orders. The Union Territory of Chandigarh has not carried out amendments in the Civil Services Conduct Rules.
Directions for Future Compliance and Legislative Enactment:
The Supreme Court issued several directions to ensure compliance with Vishaka guidelines until legislative enactment is in place:
1. Amendments in Rules: States and Union Territories must amend their Civil Services Conduct Rules and Industrial Employment (Standing Orders) Rules within two months to treat the Complaints Committee's report as an inquiry report.
2. Formation of Complaints Committees: Adequate number of Complaints Committees must be formed at taluka, district, and state levels, headed by women, with an independent member associated.
3. Mechanisms in Public and Private Sectors: Public and private sector organizations must ensure full implementation of Vishaka guidelines, including transferring the alleged harasser if found guilty and preventing harassment of witnesses and complainants.
4. Professional Bodies Compliance: Statutory bodies like the Bar Council of India, Medical Council of India, and others must ensure compliance with Vishaka guidelines by their registered members and organizations.
The court concluded that non-compliance with Vishaka guidelines should be addressed by approaching the respective High Courts, which are better positioned to handle such grievances. The writ petitions and appeals were disposed of with no orders as to costs.
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2012 (10) TMI 1268
Issues involved: Challenge to validity of judgment and order passed by Raj. Tax Board, Ajmer dated 28.10.2005 in appeal No.893/2004/Pali regarding the purpose of production of electricity and assessment order.
Validity of Judgment and Order:
The petitioner challenged the validity of the judgment and order passed by the Tax Board, arguing that the purpose of electricity production should be considered at the time of assessment. The counsel for the petitioner contended that the Tax Board erred in dismissing the appeal without considering this crucial aspect. It was urged that the assessment order passed by the assessing authority should be upheld.
Controversy and Precedent:
The respondents argued that the controversy in the case aligns with a judgment of the Hon'ble Supreme Court in Commercial Taxation Officer Vs. Rajasthan Taxchem Ltd. The counsel for the respondents cited this precedent to support their position, advocating for the dismissal of the revision petition based on the principles established in the Supreme Court ruling.
Judicial Analysis and Decision:
Upon reviewing the orders and arguments presented by both parties, the court noted that the Dy. Commissioner (Appeals) remanded the case to the assessing authority for a fresh decision. The appeal filed by the revenue was subsequently dismissed by the Tax Board. The court emphasized that all questions can now be raised by the revenue before the assessing authority, as the case has been remitted for fresh consideration. Consequently, the court found no grounds for interference and dismissed the revision petition. However, both parties were granted the opportunity to present their arguments before the assessing authority, with a directive for the authority to consider the Supreme Court judgment while re-evaluating the matter.
This summary encapsulates the key issues, arguments, and the court's decision in the legal judgment without revealing specific names or details.
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2012 (10) TMI 1267
Issues involved:
The judgment involves the dismissal of a special leave petition (SLP) challenging ongoing investigations by the Central Bureau of Investigation (CBI) into various serious economic offenses involving significant amounts of money.
Judgment Details:
Issue 1: Ongoing Investigations by CBI
The CBI is conducting investigations into seven matters involving serious economic offenses amounting to over Rs. 3000 crores. These matters include conspiracies related to different entities such as Sandur Power Company Ltd., Bharti Cements/Raghuram Cements, Penna Cements, Dalmia Cements, India Cements, investment through paper companies, Indu Projects, and Lepakshi Knowledge Hub. The CBI assured the Court that investigations are being carried out diligently and a final charge-sheet will be submitted upon completion.
Decision:
After hearing arguments from both parties and reviewing the CBI's report, the Court decided not to interfere at the current stage and dismissed the special leave petition. However, the Petitioner is allowed to seek bail before the trial court once the CBI completes its investigation and submits the final charge-sheet. The trial court will independently consider the bail application on its merits, irrespective of the dismissal of the special leave petition.
Issue 2: Next Steps
Regarding another SLP, the Court directed to put up the matter for further consideration after two weeks, indicating ongoing judicial oversight in the case.
Conclusion:
The Supreme Court dismissed the special leave petition challenging the CBI's ongoing investigations into serious economic offenses involving substantial amounts of money. The Court allowed the Petitioner to seek bail after the investigation is completed and the final charge-sheet is submitted, emphasizing that the bail application will be considered independently by the trial court. Additionally, the Court scheduled another SLP for further review after two weeks.
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2012 (10) TMI 1265
Issues Involved:
1. Plaintiff's entitlement to 1/2 share in the estate of the deceased father.
2. Validity of the transfer of shares to Defendant No. 2.
3. Jurisdiction of the High Court vs. Company Law Board (CLB).
4. Limitation period for filing the suit.
Summary:
1. Plaintiff's Entitlement to 1/2 Share in the Estate:
The Plaintiff sued for a declaration of his 1/2 share in the estate of his deceased father, particularly focusing on 49010 shares of KNK Trading Pvt. Ltd. The Plaintiff's father executed a Will in 2003 bequeathing the shares equally to the Plaintiff and Defendant No. 1. The Plaintiff challenged the transfer of shares to Defendant No. 2 as fraudulent, citing discrepancies in the annual returns filed u/s 169 of the Companies Act. The court noted email exchanges indicating ongoing negotiations about the property, suggesting the transfer was not bona fide. The Plaintiff's share in the estate required protection pending the Notice of Motion.
2. Validity of the Transfer of Shares:
The Plaintiff contested the transfer of shares to Defendant No. 2, alleging it was fraudulent and not executed by the deceased. The court observed that the Will, accepted by both brothers, indicated the father held the shares until his death. The court also noted that the Plaintiff's share in the property needed protection pending the suit.
3. Jurisdiction of the High Court vs. Company Law Board (CLB):
Defendant No. 5 raised the issue of the High Court's jurisdiction, arguing it was barred u/s 10E(4C) r/w Sec. 111(4) and (7) of the Companies Act, 1956. The court held that the inherent jurisdiction of the High Court was not barred. It was determined that the CLB could not adjudicate on the title of the shares, which involved complicated questions of fact and allegations of fraud. The court cited precedents indicating that such matters should be decided by the Civil Court.
4. Limitation Period for Filing the Suit:
Defendants 1 to 3 claimed the suit was barred by the Law of Limitation, arguing the Plaintiff knew about the transfer of shares in 1999. The Plaintiff contended he became aware of the fraudulent transfer in January 2012. The court noted that oral evidence would need to be led on the issue of limitation and adjourned the suit for further consideration.
Ad-Interim Order:
Defendants 1, 2, and 3 were ordered to deposit Rs. 7.5 Crores in the court towards the Plaintiff's share within 4 weeks. If not deposited, Defendants were restrained from disposing of, alienating, or creating third-party rights in the properties listed in Exhibit-C to the plaint pending the Notice of Motion.
Conclusion:
The court protected the Plaintiff's share in the estate, determined its jurisdiction over the matter, and addressed the limitation issue, ensuring the Plaintiff's interests were safeguarded pending the final resolution of the suit.
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2012 (10) TMI 1264
Issues involved: Appeal against order of Commissioner of Income-tax(Appeals)-II, Ludhiana u/s 143(3) of the Income Tax Act, 1961. Delay of 29 days in filing present appeal. Addition of Rs.1,86,799/- on account of employees' contribution to Provident Fund and ESIC.
Delay in filing appeal:
The assessee filed an appeal after a delay of 29 days and sought condonation of the delay, attributing it to the simultaneous handling of appeals for the assessee and its sister concern. The Tribunal accepted the unintentional nature of the delay, condoned it, and admitted the appeal.
Employees' contribution to Provident Fund and ESIC:
The only issue raised in the appeal was the addition of Rs.1,86,799/- for belated payment of employees' contribution to PF and ESIC. The Assessing Officer observed the delayed payments but acknowledged that they were made before the due date of filing the income tax return. The Tribunal referred to the precedent set by CIT Vs. M/s Lakhani India Ltd. (2010) 188 Taxman 132 (P&H) and directed the Assessing Officer to allow the deduction of Rs.1,86,799/-, in line with the High Court's ruling. Consequently, the grounds of appeal were upheld, and the appeal by the assessee was allowed.
Conclusion:
The appeal filed by the assessee was allowed, and the order was pronounced in the Open Court on the 4th day of October, 2012.
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2012 (10) TMI 1263
Issues involved: Challenge to disallowance u/s 14A of the Act read with Rule 8D of Income-tax Rules.
Summary:
Issue 1: Disallowance u/s 14A of the Act read with Rule 8D of Income-tax Rules
The appeal was against the disallowance of Rs.4,17,376/- made by the Assessing Officer u/s 14A of the Act read with Rule 8D of Income-tax Rules, which was confirmed by the CIT(A). The assessee, a company engaged in trading and dealing in shares and securities, had claimed exempt dividend income of Rs.1,16,600/- without making any disallowance for related expenses as required by section 14A. The CIT(A) agreed that Rule 8D was not applicable for the assessment year 2007-08 and that a reasonable basis should be used for the disallowance. However, the CIT(A) still upheld the disallowance based on Rule 8D. The Tribunal, considering the decision of the Bombay High Court, held that the disallowance should be made on a reasonable basis for years prior to 2008-09. It determined a fair and reasonable disallowance u/s 14A at Rs.29,150/-, being 25% of the dividend income received by the assessee, and directed the AO to restrict the disallowance accordingly.
In conclusion, the appeal was partly allowed, and the disallowance u/s 14A was modified to Rs.29,150/-.
Order pronounced on 10th October 2012.
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2012 (10) TMI 1262
Issues Involved:
1. Jurisdiction of BIFR to entertain an application for reference by a foreign company under SICA.
2. Interpretation of the term "Company" under SICA and Companies Act, 1956.
3. Applicability of SICA to foreign companies operating in India.
4. Validity of proceedings before BIFR given the company's winding-up status.
Summary:
Jurisdiction of BIFR:
The central issue was whether the Board of Industrial and Financial Reconstruction (BIFR) had jurisdiction to entertain an application for reference made by Baranagar Jute Factory Plc., a company incorporated in England, under the provisions of the Sick Industrial Companies (Special Provisions) Act (SICA). The learned Single Judge held that the appellant, being a company incorporated and registered in England, could not maintain any application for reference before BIFR under SICA.
Interpretation of "Company":
The Court examined whether the definition of "Company" under section 3 of the Companies Act, 1956, and section 3(d) of SICA could include a foreign company registered in India. The Court emphasized the phrase "unless the context otherwise requires" in both statutes, suggesting that the definition should be inclusive rather than exclusive. The Court concluded that SICA, being a social welfare legislation, should be interpreted to protect the interests of workers and creditors, thus including foreign companies registered in India under its purview.
Applicability of SICA to Foreign Companies:
The Court noted that Baranagar Jute Factory Plc., although incorporated in England, had its only business unit in India, employed around 3700 workers, and conducted all its business activities in India. The Court held that SICA applies to foreign companies operating in India, given the legislative intent to protect workers and creditors. The Court relied on various Supreme Court decisions to support a purposive interpretation of SICA, ensuring the protection of Indian shareholders, creditors, and workers.
Validity of Proceedings Before BIFR:
The Court observed that the winding-up order against Baranagar Jute Factory Plc. had been stayed, and the company was functioning as a going concern. The Court held that BIFR had jurisdiction to entertain proceedings even if a winding-up order was pending, as per section 22 of SICA. The Court dismissed the appeals challenging BIFR's jurisdiction, emphasizing that the company continued to operate under the scheme approved by the Supreme Court and the Company Court.
Conclusion:
The Court set aside the judgment of the learned Single Judge, holding that SICA applies to foreign companies operating in India. The appeals challenging BIFR's jurisdiction were dismissed, and the Court emphasized the need for a purposive interpretation of SICA to protect the interests of workers and creditors. The Court granted a stay of operation for three weeks after the Puja Vacation, with the interim order continuing until then.
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2012 (10) TMI 1261
Issues Involved:
1. Validity of reopening of assessments.
2. Determination of cost of construction.
3. Power of CIT(Appeals) to give directions for another year.
4. Adoption of CPWD vs. State PWD rates for valuation.
Summary:
1. Validity of Reopening of Assessments:
The assessees challenged the validity of the reopening of assessments, except for Shri Shivlal, whose assessment was a regular one. The CIT(Appeals) initially held that the reopenings based on the DVO report were not valid. However, this Tribunal, in its order dated 20.11.2009, held the reopening to be valid and remitted the case back to the CIT(Appeals) for adjudicating the issue relating to the cost of construction.
2. Determination of Cost of Construction:
The CIT(Appeals) directed the adoption of State PWD rates for determining the cost of construction, reducing the CPWD rates by 20% as per the Tribunal's decision in Prabhu Deva v. ITO. The CIT(Appeals) also spread the cost of construction over two assessment years (2003-04 and 2004-05) based on the DVO's report. The Revenue argued that the addition should not be split over two years, citing the decision of the Hon'ble Kerala High Court in Sakthi Tourist Home v. CIT. The Tribunal found that the matter required a re-visit by the Assessing Officer to determine the cost of construction with cogent reasons, whether based on CPWD or State PWD rates, and to consider the books maintained by the assessees.
3. Power of CIT(Appeals) to Give Directions for Another Year:
The Revenue contended that the CIT(Appeals) did not have the power to give directions for another year. The Tribunal referred to the Hon'ble Apex Court's decision in Rajinder Nath v. CIT, which clarified that a finding necessary for the disposal of the case could involve directions for another year if intimately involved in the process. The Tribunal concluded that the CIT(Appeals) had the power to direct the spreading of the unexplained investment over the period of construction.
4. Adoption of CPWD vs. State PWD Rates for Valuation:
The assessees argued that State PWD rates should be adopted instead of CPWD rates. The Tribunal noted that the CIT(Appeals) relied on the decision in Prabhu Deva v. ITO, which allowed a 20% reduction on CPWD rates to align with State PWD rates. The Tribunal emphasized that the determination of cost of construction should be based on the facts of each case and remitted the issue back to the Assessing Officer for fresh consideration.
Conclusion:
The Tribunal set aside the orders of the authorities below and remitted the issue back to the Assessing Officer for fresh consideration, directing the A.O. to determine the cost of construction in accordance with the law and provide the assessees an opportunity to justify their declared cost of construction. The appeals of the Revenue and the cross-objections of the assessees were partly allowed for statistical purposes.
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