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• 2013 (8) TMI 1198
  
  ISSUES PRESENTED and CONSIDERED

  The core legal issues considered in this judgment were:

  1. Whether the application of Section 50C of the Income Tax Act was appropriate in determining the sale consideration for the purpose of computing long-term capital gains, despite the actual sale consideration being lower than the valuation by the Stamp Valuation Authority.

  2. Whether the provisions of Section 50C could override or control the provisions of Section 54EC concerning the exemption on capital gains reinvested in specified bonds.

  3. Whether the decision of the jurisdictional ITAT, Kolkata Bench in the case of Smt. Chandrakala Devi Bansal vs. ITO was misinterpreted by the Commissioner of Income-tax (Appeals).

  ISSUE-WISE DETAILED ANALYSIS

  1. Application of Section 50C in Determining Sale Consideration

  - Relevant Legal Framework and Precedents: Section 50C of the Income Tax Act mandates that if the consideration received on the transfer of a capital asset is less than the value assessed by the Stamp Valuation Authority, the latter value is deemed to be the full value of consideration for computing capital gains.

  - Court's Interpretation and Reasoning: The Tribunal noted that the assessee did not dispute the valuation by the Stamp Valuation Authority. The Tribunal emphasized that once the valuation is accepted, Section 50C mandates its adoption for capital gains computation.

  - Key Evidence and Findings: The assessee sold land for Rs. 10 lakhs, but the Stamp Valuation Authority assessed it at Rs. 35 lakhs. The assessee did not contest this valuation at any stage.

  - Application of Law to Facts: The Tribunal applied Section 50C, affirming the Assessing Officer's decision to adopt the valuation of Rs. 35 lakhs for capital gains calculation.

  - Treatment of Competing Arguments: The assessee's argument for considering only the actual sale consideration was dismissed due to the absence of any objection to the Stamp Valuation Authority's assessment.

  - Conclusions: The Tribunal concluded that the application of Section 50C was correct, and the valuation by the Stamp Valuation Authority should be used for computing capital gains.

  2. Interaction Between Sections 50C and 54EC

  - Relevant Legal Framework and Precedents: Section 54EC provides for exemption from capital gains tax if the gains are reinvested in specified bonds, but does not explicitly override Section 50C.

  - Court's Interpretation and Reasoning: The Tribunal noted that Section 50C and Section 54EC operate on different planes. Section 50C determines the deemed sale consideration, while Section 54EC provides for exemption on reinvestment. The Tribunal found no legal basis for Section 54EC to override the deemed consideration under Section 50C.

  - Key Evidence and Findings: The assessee reinvested Rs. 10 lakhs in bonds, claiming exemption under Section 54EC, but the deemed capital gains were higher due to Section 50C.

  - Application of Law to Facts: The Tribunal upheld the use of Rs. 35 lakhs as the sale consideration under Section 50C, limiting the Section 54EC exemption to the actual reinvestment amount.

  - Treatment of Competing Arguments: The Tribunal dismissed the argument that Section 54EC could control the deemed consideration under Section 50C, citing the distinct purposes of the provisions.

  - Conclusions: The Tribunal concluded that Section 50C's deemed consideration is applicable, and the Section 54EC exemption is limited to the actual reinvestment.

  3. Interpretation of Jurisdictional ITAT Decision

  - Relevant Legal Framework and Precedents: The assessee referenced a prior ITAT decision, arguing misinterpretation by the Commissioner of Income-tax (Appeals).

  - Court's Interpretation and Reasoning: The Tribunal reviewed the referenced decision and found no misinterpretation by the Commissioner of Income-tax (Appeals). The Tribunal noted that the cited case was not directly applicable to the present facts.

  - Key Evidence and Findings: The Tribunal did not find any specific misinterpretation in the application of the cited decision.

  - Application of Law to Facts: The Tribunal affirmed the Commissioner of Income-tax (Appeals)'s interpretation, finding it consistent with legal principles.

  - Treatment of Competing Arguments: The Tribunal addressed the assessee's claim of misinterpretation but found no substantive basis for it.

  - Conclusions: The Tribunal concluded that there was no misinterpretation of the jurisdictional ITAT decision by the Commissioner of Income-tax (Appeals).

  SIGNIFICANT HOLDINGS

  - Preserve verbatim quotes of crucial legal reasoning: The Tribunal stated, "Once the stamp valuation authority's value has been accepted by the assessee, then the same would have to be adopted in view of the specific provisions of section 50C of the Act."

  - Core principles established: The judgment reinforced the principle that the deemed consideration under Section 50C is binding unless contested, and that Section 54EC does not override Section 50C.

  - Final determinations on each issue: The Tribunal dismissed the appeal, upholding the application of Section 50C and the limited exemption under Section 54EC based on actual reinvestment.

  ---

• 2013 (8) TMI 1197
  
  The Supreme Court considered an appeal against a judgment upholding a directive for compassionate appointment under a scheme. The deceased's family member sought compassionate appointment after the death of a Class III employee. The Court emphasized that compassionate employment is not a right but an exception to alleviate financial distress. The Court cited Umesh Kumar Nagpal v. State of Haryana, emphasizing the purpose of compassionate employment to assist the family during a crisis. The Court highlighted that compassionate employment should not be viewed as an alternative recruitment method and that delayed applications may not be entertained.Additionally, the Court referenced A. Umarani v. Registrar, Co-operative Societies, stating that appointments made in contravention of established schemes/rules are illegal. The Court defined "vested right" as a fixed, accrued, settled, or absolute right not contingent on any condition precedent. The Court cited State Bank of India v. Raj Kumar, emphasizing that eligibility for compassionate appointment depends on various factors, including financial conditions. The Court concluded that the impugned judgments were unsustainable in law and allowed the appeal, directing the respondent to apply under the new scheme for consideration within three months.In summary, the Court clarified the principles governing compassionate appointments, highlighting that such appointments are not automatic rights and must adhere to established schemes and eligibility criteria. The Court set aside the previous judgments and directed the respondent to apply under the new scheme for proper consideration within a specified timeframe.

  ---

• 2013 (8) TMI 1196
  
  ISSUES PRESENTED and CONSIDERED

  The core legal issues considered in this judgment are:

  1. Whether the 1st Respondent is entitled to retrospective seniority from the date the vacancy arose rather than from the date of promotion.

  2. Whether the denial of retrospective seniority to the 1st Respondent constitutes hostile discrimination under Article 14 of the Constitution of India.

  3. The applicability of Rule 21 of the Uttar Pradesh Ayurvedic Aur Unani Mahavidyalaya Aadhyapako Ki Seva Niyamawali, 1990 in determining seniority.

  4. The relevance of the precedent set in Keshav Chandra Joshi v. Union of India in the context of this case.

  ISSUE-WISE DETAILED ANALYSIS

  1. Retrospective Seniority Entitlement

  Relevant legal framework and precedents: The legal framework primarily revolves around Rule 21 of the 1990 rules, which determines seniority from the date of the order of substantive appointment unless otherwise specified. The Court also considered precedents such as Union of India v. S.S. Uppal, State of Karnataka v. C. Lalitha, and State of Uttaranchal v. Dinesh Kumar Sharma, which emphasize that seniority is determined by the rules in force at the time of appointment.

  Court's interpretation and reasoning: The Court interpreted Rule 21 to mean that seniority should be determined from the date of promotion unless the appointment order specifies a backdate. The Court emphasized that retrospective seniority cannot be granted unless expressly provided by the rules.

  Key evidence and findings: The Court found that the appointment order for the 1st Respondent did not specify a backdate for seniority. The Court also noted that other incumbents promoted alongside the 1st Respondent were also given seniority from the date of promotion.

  Application of law to facts: The Court applied Rule 21 and the relevant precedents to conclude that the 1st Respondent's seniority should be determined from the date of promotion, not from the date of vacancy.

  Treatment of competing arguments: The Court rejected the argument that the 1st Respondent was entitled to retrospective seniority based on the vacancy date, emphasizing that such a grant would be contrary to established legal principles.

  Conclusions: The Court concluded that the claim for retrospective seniority was untenable and not supported by the applicable rules or precedents.

  2. Hostile Discrimination

  Relevant legal framework and precedents: Article 14 of the Constitution of India prohibits discrimination. The Court also considered the precedent in Keshav Chandra Joshi regarding the treatment of promotees and direct recruits.

  Court's interpretation and reasoning: The Court found that the 1st Respondent was governed by a different set of rules than those who received retrospective seniority. Thus, there was no basis for a claim of discrimination.

  Key evidence and findings: The Court noted that the ten incumbents who received retrospective seniority were governed by amended rules, which did not apply to the 1st Respondent.

  Application of law to facts: The Court applied the principle that discrimination claims require similarly situated individuals to be treated differently under the same rules. Since the 1st Respondent and the ten incumbents were governed by different rules, no discrimination occurred.

  Treatment of competing arguments: The Court dismissed the argument of hostile discrimination, clarifying that the rules applicable to the 1st Respondent did not allow for retrospective seniority.

  Conclusions: The Court concluded that there was no hostile discrimination against the 1st Respondent.

  3. Applicability of Keshav Chandra Joshi Precedent

  Relevant legal framework and precedents: The Court examined the precedent set in Keshav Chandra Joshi, which dealt with seniority between direct recruits and promotees.

  Court's interpretation and reasoning: The Court clarified that the principles in Keshav Chandra Joshi were not applicable to the present case, as it dealt with a different context and set of rules.

  Key evidence and findings: The Court found that the High Court had misapplied the precedent, as the facts and rules in the present case were distinct.

  Application of law to facts: The Court applied the correct interpretation of Keshav Chandra Joshi, focusing on the specific rules governing the 1st Respondent's case.

  Treatment of competing arguments: The Court rejected the High Court's reliance on Keshav Chandra Joshi, emphasizing the need to apply the correct legal framework.

  Conclusions: The Court concluded that the High Court erred in applying the precedent of Keshav Chandra Joshi to the present case.

  SIGNIFICANT HOLDINGS

  Verbatim quotes of crucial legal reasoning: "The seniority of a person is to be determined according to the seniority rule applicable on the date of appointment. Weightage in seniority cannot be given retrospective effect unless it is specifically provided in the rule in force at the material time."

  Core principles established: The Court reiterated that seniority must be determined by the applicable rules at the time of appointment and cannot be granted retrospectively unless expressly provided for in those rules.

  Final determinations on each issue: The Court determined that the 1st Respondent was not entitled to retrospective seniority and that there was no hostile discrimination. The High Court's reliance on Keshav Chandra Joshi was misplaced, and the appeal was allowed, setting aside the High Court's order.

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• 2013 (8) TMI 1195
  
  In the judgment delivered by the Bombay High Court, presided over by Dr. D.Y. Chandrachud and S.C. Gupte, JJ., the court addressed an appeal involving the appellant represented by Mr. Kiran Bapat and Mr. Ravindra V. Sankpal, and the official liquidator represented by Mr. L.T. Satelkar. The court noted that the present appeal is governed by the judgment in companion Appeal No.34/2012, which was heard concurrently. Based on the reasons provided in dismissing the companion appeal, the court dismissed the present appeal as well, with no order as to costs.

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• 2013 (8) TMI 1194
  

  1. ISSUES PRESENTED and CONSIDERED

  The core legal issues considered in this judgment are:

  • Whether the winding up petition filed by the petitioning creditor is maintainable given the previous court decisions.
  • Whether the principle of res judicata applies to bar the current winding up proceedings.
  • Whether the petitioning creditor has a legitimate claim to the outstanding amount based on the Letter of Intent and the subsequent actions.
  • Whether the defenses raised by the company are bona fide or merely sham to avoid payment.

  2. ISSUE-WISE DETAILED ANALYSIS

  Issue 1: Maintainability of the Winding Up Petition

  • Relevant legal framework and precedents: The court considered the previous decisions by the Single Bench and the Division Bench regarding the maintainability of the winding up petition.
  • Court's interpretation and reasoning: The Division Bench had set aside the Single Bench's observation that barred the petitioning creditor from initiating another winding up proceeding. The court interpreted this as allowing the petitioning creditor the right to file a new petition.
  • Key evidence and findings: The petitioning creditor rectified the discrepancies in the memorandum of association that were previously pointed out.
  • Application of law to facts: The court found that the rectification of the memorandum of association and the Division Bench's order allowed the petitioning creditor to maintain the petition.
  • Treatment of competing arguments: The company argued that the petition was barred by res judicata, but the court found this unpersuasive given the Division Bench's decision.
  • Conclusions: The court concluded that the winding up petition is maintainable.

  Issue 2: Application of Res Judicata

  • Relevant legal framework and precedents: The principle of res judicata, as discussed in Kalinga Mining Corpn. v. Union of India, was considered.
  • Court's interpretation and reasoning: The court noted that res judicata applies when an issue has been finally determined in a previous proceeding. However, the Division Bench had set aside the previous decision, allowing for a new petition.
  • Key evidence and findings: The Division Bench's order explicitly allowed the petitioning creditor to initiate another winding up proceeding.
  • Application of law to facts: The court found that the principle of res judicata did not apply because the previous decision was not a final determination of the merits.
  • Treatment of competing arguments: The company contended that the previous order was final, but the court disagreed based on the Division Bench's clarification.
  • Conclusions: The court held that res judicata does not bar the current proceedings.

  Issue 3: Legitimacy of the Petitioning Creditor's Claim

  • Relevant legal framework and precedents: The court examined the terms of the Letter of Intent and the subsequent actions taken by the parties.
  • Court's interpretation and reasoning: The court found that the petitioning creditor had fulfilled its obligations under the Letter of Intent and was entitled to the claimed amount.
  • Key evidence and findings: The invoices and the lack of bona fide dispute over the amounts were key evidence supporting the petitioning creditor's claim.
  • Application of law to facts: The court applied the terms of the Letter of Intent and found that the petitioning creditor was entitled to the outstanding amount.
  • Treatment of competing arguments: The company argued that the invoices were invalid without certain certificates, but the court found this defense to be sham and unsupported by evidence.
  • Conclusions: The court concluded that the petitioning creditor's claim was legitimate and enforceable.

  Issue 4: Bona Fide Nature of the Company's Defenses

  • Relevant legal framework and precedents: The court considered the defenses raised by the company in its affidavit-in-opposition.
  • Court's interpretation and reasoning: The court found that the defenses were not bona fide and were intended to delay payment.
  • Key evidence and findings: The court noted the lack of evidence supporting the company's claims about the necessity of certificates for payment.
  • Application of law to facts: The court found that the company's defenses were not credible and did not constitute a genuine dispute.
  • Treatment of competing arguments: The petitioning creditor provided evidence that the necessary certificates had been submitted, countering the company's claims.
  • Conclusions: The court held that the company's defenses were sham and did not preclude the winding up petition.

  3. SIGNIFICANT HOLDINGS

  • Preserve verbatim quotes of crucial legal reasoning: "The Division Bench has specifically observed that the petitioning creditor's right as a lawful claimant to initiate another winding up proceeding cannot be foreclosed in terms of the observation of the Hon'ble Single Judge and ultimately set aside such observations."
  • Core principles established: The court established that a winding up petition is maintainable if the previous proceedings did not constitute a final determination on the merits, and that res judicata does not apply if a higher court allows for a new proceeding.
  • Final determinations on each issue: The court admitted the winding up petition, finding it maintainable and not barred by res judicata, and determined that the petitioning creditor's claim was legitimate and the company's defenses were not bona fide.

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• 2013 (8) TMI 1193
  

  1. ISSUES PRESENTED and CONSIDERED

  The core legal issue in this judgment is whether the fixation of a benchmark for selection after the commencement of the recruitment process constitutes an impermissible change in the selection criteria. Specifically, the question is whether setting a benchmark of 70 marks for the General Category and 65 marks for the Reserved Category after the written test and interview amounts to changing the "rules of the game" midway through the selection process.

  2. ISSUE-WISE DETAILED ANALYSIS

  Relevant Legal Framework and Precedents:

  The legal framework involves the principles governing recruitment processes, particularly the prohibition against altering selection criteria after the process has commenced. The appellants relied on the precedent set in Himani Malhotra vs. High Court of Delhi, where the Supreme Court held that introducing minimum qualifying marks for viva voce after the selection process had begun was impermissible.

  Court's Interpretation and Reasoning:

  The court distinguished the present case from Himani Malhotra by noting that in the current matter, the selection criteria of 80 marks for the written test and 20 marks for the interview were established from the outset. The court reasoned that the benchmark was not a change in criteria but rather a permissible shortlisting tool to ensure the selection of the most meritorious candidates.

  Key Evidence and Findings:

  The appellants participated in the written test and interview, securing more than the minimum required marks in the written test. However, they were not selected due to not meeting the newly fixed benchmark of 65 marks for the Reserved Category. The court found that the respondents had not disclosed this benchmark at the time of the advertisement or the commencement of the recruitment process.

  Application of Law to Facts:

  The court applied the principle that while rules governing selection cannot be changed mid-process, the fixation of a benchmark post-interview did not constitute such a change. It was deemed a legitimate exercise of the employer's discretion to ensure high standards of competence.

  Treatment of Competing Arguments:

  The appellants argued that the fixation of the benchmark was arbitrary and contrary to the established legal principles. The respondents contended that the benchmark was necessary due to the high number of applicants and was within their prerogative. The court sided with the respondents, finding their actions justified and not in violation of legal norms.

  Conclusions:

  The court concluded that the fixation of the benchmark was a permissible exercise of discretion aimed at shortlisting the most qualified candidates and did not amount to an impermissible change in the selection criteria.

  3. SIGNIFICANT HOLDINGS

  Preserve Verbatim Quotes of Crucial Legal Reasoning:

  "In the absence of any rule on this aspect in the first instance, this does not amount to changing the 'rules of the game'. The High Court has rightly held that it is not a situation where securing of minimum marks was introduced which was not stipulated in the advertisement, standard was fixed for the purpose of selection."

  Core Principles Established:

  The court established that setting a benchmark for final selection, even if not initially disclosed, is permissible if it serves the purpose of ensuring the selection of meritorious candidates and does not alter the fundamental selection criteria established at the outset.

  Final Determinations on Each Issue:

  The appeals were dismissed, with the court affirming that the fixation of a benchmark was a legitimate exercise of discretion by the employer and did not constitute a change in the selection criteria. The court emphasized the importance of maintaining high standards in recruitment processes, particularly for specialized roles.

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• 2013 (8) TMI 1192
  
  The High Court of Madras, comprising Hon'ble R.K. Agrawal, Acting Chief Justice, and M. Sathyanarayanan, J., addressed writ appeals under Clause 15 of the Letters Patent against a common order dismissing writ petitions (WP Nos. 1214 and 1292 of 2013) filed under Article 226 of the Constitution of India. The petitions sought a Writ of Certiorari Mandamus to quash the order No. WTM/RKA/SRO/66/2012 dated 31-12-2012, preventing the petitioner company from accessing the capital market.
  
  The writ petitions were dismissed on the grounds that an effective alternative remedy was available before the Securities Appellate Tribunal (SAT). However, at the time of filing the writ appeals, the SAT lacked a Judicial Member, functioning with only a Non-Judicial Member, prompting the court to grant an interim order.
  
  Subsequently, Mr. G. Masilamani, Additional Solicitor General, informed the court of the appointment of Justice Shri Jaiparakash P. Dayadhar as the Presiding Officer/Judicial Member of the SAT, thus removing the impediment for the appellants to approach the Tribunal.
  
  The court concluded that the appellants could invoke the appeal remedy before the SAT within two weeks from receiving the judgment copy and could seek interim orders pending appeal disposal. The interim order granted by the court was to continue until the SAT entertained the appeals and passed orders on interlocutory applications. The SAT was instructed not to enforce the limitation period for filing appeals if done within the specified two-week period. The writ appeals were disposed of with no costs, and connected miscellaneous petitions were closed.

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• 2013 (8) TMI 1191
  
  Issues:
  1. Winding up of the respondent-Company sought by RBI.
  2. Ownership and access to safe deposit lockers.
  3. Request for direction to open lockers and take possession of articles.
  
  Analysis:
  The judgment pertains to a Company Petition filed by the Reserve Bank of India (RBI) seeking the winding up of the respondent-Company under Section 45-MC of the Reserve Bank of India Act, 1934 r/w Section 433 of the Company Act, 1956. The respondent company, a non-banking financial institution, was incorporated in 1985 and operated under the regulatory framework of the RBI. The Court appointed an official liquidator to take charge of the company's assets and properties, including safe deposit lockers, following the filing of the Company Petition by RBI.
  
  The applicant, a customer of the respondent company, sought permission from the Official Liquidator to open his safe deposit lockers and take possession of the articles stored within. The Court issued directions for the opening of the lockers in the presence of the applicant, a representative of the RBI, and the Official Liquidator. An inventory of the contents was to be prepared, and the articles were to be kept back in the lockers after the inventory process. The keys to the lockers were to remain with the applicant until further orders.
  
  Following the opening of the lockers and the inventory process, the Official Liquidator did not dispute the ownership claims made by the applicant regarding the articles stored in the lockers. Consequently, the Court ordered the Official Liquidator to hand over all the listed articles to the applicant and his wife upon execution of an indemnity bond and an undertaking not to dispose of the articles for at least one year. The applicant and his wife were required to provide an affidavit affirming the undertaking, with the indemnity bond and undertaking remaining valid for one year from the date of possession.
  
  Furthermore, the Official Liquidator was directed to have an Officer of the RBI present during the handover of the articles, and if any ex-Directors were available, they were also invited to witness the transfer. The judgment concluded by disposing of the application with the specified directions, ensuring the proper transfer of the articles from the lockers to the applicant and his wife while safeguarding the interests of all parties involved.

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• 2013 (8) TMI 1190
  
  Issues Involved:
  
  1. Whether the respondent company should be wound up under Sections 433 and 434 of the Companies Act, 1956 due to its inability to pay debts.
  2. Whether the respondent company's defense against the petitioner's claim is bona fide and genuine.
  3. Whether the petitioner's claim is barred by limitation.
  4. Whether the petitioner's claim is crystallized and undisputed.
  
  Detailed Analysis:
  
  1. Winding Up of the Respondent Company:
  
  The petitioner sought the winding up of the respondent company, Ajanta India Limited, under Sections 433 and 434 of the Companies Act, 1956, on the grounds that the respondent failed and neglected to make payment for goods supplied. The petitioner claimed that the respondent owed Rs. 37,58,194.87 with interest at 21% per annum. Despite statutory notices, the respondent did not reply or make any payment, which the petitioner argued amounted to "neglect to pay" under Section 434 of the Act. The court considered whether the respondent company had lost its capacity to pay and was unable to discharge its financial obligations, which would justify winding up. The petitioner argued that the respondent's failure to pay, even after admitting liability to some extent, demonstrated its inability to discharge debts.
  
  2. Bona Fide and Genuine Defense:
  
  The respondent opposed the petition, claiming that the alleged dues were exaggerated and involved disputed facts. The respondent contended that it was a going concern and that the petitioner's claim was not justified. The defense included disputes over the quality and quantity of goods, agreed rates, and freight charges. The court examined whether the defense was bona fide and genuine, or merely a ruse to defeat the petition. It was noted that the respondent had admitted liability to some extent but failed to make payments as per its own admission. The court emphasized that a defense must be in good faith and substantial to avoid a winding-up order, as per the principles established by the Hon'ble Apex Court.
  
  3. Limitation of the Petitioner's Claim:
  
  The respondent argued that the petitioner's claim was barred by limitation. However, the court found that the respondent had acknowledged its liability in communications dated 4.10.2009 and 8.2.2012, which included an offer to pay Rs. 15,00,000 in installments. Such acknowledgments and offers to pay indicated that the claim was not time-barred, as the respondent had recognized its debt within the limitation period.
  
  4. Crystallization of the Petitioner's Claim:
  
  The respondent contended that the petitioner's claim was not crystallized. The petitioner argued that the principal amount of Rs. 37,58,194.87 and the interest rate of 21% were fixed, and thus, the claim was crystallized. The court observed that the respondent had admitted liability to the extent of Rs. 26,92,937.00 and had not disputed this amount in its communications. The court noted that the respondent's failure to pay even the admitted amount, despite acknowledging the debt, indicated a lack of genuine dispute over the crystallization of the claim.
  
  Conclusion:
  
  The court concluded that the respondent's defense was not bona fide or genuine, as the alleged disputes were not supported by contemporaneous evidence. The respondent's failure to return the goods or raise timely disputes about quality or quantity further weakened its defense. The court ordered the respondent to deposit Rs. 30,00,000 with the court registry by 3.9.2013 to demonstrate its bona fides. Failure to deposit the amount would lead to the admission of the petition and appointment of a Provisional Liquidator. The matter was adjourned to 4.9.2013 for further proceedings.

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• 2013 (8) TMI 1189
  
  Issues Involved:
  
  1. Whether the complaint is liable to be quashed on the ground of delay in filing the complaint.
  2. Whether the Chairman of SEBI could authorize an official to file the complaint without specific delegation of powers.
  3. Whether a "personal hearing" is mandatorily required by a statutory authority to comply with the principles of natural justice.
  
  Detailed Analysis:
  
  1. Delay in Filing the Complaint:
  
  The petitioners sought to quash the complaint on the grounds of delay. SEBI received a complaint on 27.06.1996, and an anonymous complaint in October 1996, alleging price rigging and insider trading. Preliminary inquiries were made to ensure the complaints were not frivolous, leading to a formal investigation ordered on 02.02.1999. The investigation concluded with filing the complaint in March 2000. The court noted that economic offences involving complex transactions take time to investigate. The court referenced Section 473 of the Cr.P.C., which allows for extending the limitation period if justified in the interest of justice. The court left the question of limitation open for trial consideration, allowing the respondent to seek extension under Section 473 during the trial.
  
  2. Authorization by SEBI Chairman:
  
  The petitioners questioned whether the SEBI Chairman could authorize a complaint filing without specific delegation. The court referred to Sections 4(2) and 4(3) of the SEBI Act, 1992, which vest general superintendence, direction, and management in the Board and the Chairman. The court concluded that the Chairman's powers include initiating prosecution without needing specific delegation from the Board. The court emphasized that reading Section 19 of the Act concerning delegation harmoniously with Section 4 supports this interpretation, and any substantial compliance questions should be considered at trial, not at the initial stage.
  
  3. Requirement of Personal Hearing:
  
  The petitioners argued that a personal hearing was necessary to comply with natural justice principles. The court referenced the Supreme Court's decision in Patel Engineering Ltd. v. Union of India, which stated that a personal hearing is not an inviolable rule before every state decision. The court noted that since show-cause notices were issued and the petitioners did not request a personal hearing, the lack of such a hearing does not vitiate the proceedings. The court found no violation of natural justice principles in this context.
  
  Conclusion:
  
  The court found no justification to quash the criminal complaint and the summoning order. The petitions were dismissed, with the court refraining from commenting on the merits to avoid prejudicing the petitioners at trial. The issues of delay and authorization were left open for further consideration during the trial.

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• 2013 (8) TMI 1188
  
  Issues:
  Petition for winding up under Companies Act, 1956 due to non-payment of loan amount. Service of notice to the respondent. Acknowledgment of debt by the respondent. Appointment of Provisional Liquidator. Compliance with Companies Act requirements by the Directors of the respondent.
  
  Analysis:
  The judgment pertains to a petition filed by a bank seeking winding up of a company under Sections 433(e)/434(1)(a)/439 of the Companies Act, 1956, due to non-payment of a substantial loan amount. The petition was initiated as the respondent company failed to pay an amount of Rs. 11,77,65,057.22 paise, representing the loan advanced by the petitioner bank along with interest. Despite efforts to serve notice to the respondent, including publication in newspapers and affixation at the registered office, the respondent did not appear or file a reply, leading to the petition being heard in their absence.
  
  The counsel for the petitioner highlighted the balance sheet of the respondent company, showing an acknowledgment of the debt owed to the bank as of a specific date. Additionally, a letter dated 29.07.2011 from the respondent to the bank further confirmed the outstanding amount due, serving as an admission of the debt as per Section 18 of the Limitation Act, 1963. Subsequently, a statutory notice demanding payment was issued to the respondent, which was duly served, but no response was received.
  
  Based on the evidence presented, the court was satisfied that the respondent had neglected to pay the admitted debt to the bank, leading to the appointment of an Official Liquidator (OL) as the Provisional Liquidator of the respondent. The OL was tasked with taking over all assets, books of accounts, and records of the respondent, preparing an inventory of assets, and seeking valuation assistance if necessary. Moreover, the court ordered the publication of the petition citation in official gazettes and directed the Directors of the respondent to comply with specific requirements of the Companies Act by submitting relevant statements and documents within stipulated timelines.
  
  In conclusion, the judgment underscores the legal recourse available under the Companies Act for non-payment of debts, emphasizing the acknowledgment and admission of debt as crucial factors in winding up proceedings. The appointment of a Provisional Liquidator and the directive for compliance with statutory obligations by the company's Directors aim to ensure orderly proceedings and protection of the creditor's interests.

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• 2013 (8) TMI 1187
  
  The Supreme Court of India dismissed the special leave petition after condoning the delay. (Citation: 2013 (8) TMI 1187 - SC Order)

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• 2013 (8) TMI 1186
  
  The Supreme Court of India dismissed the Special Leave Petitions as there was no reason to entertain them. Citation: 2013 (8) TMI 1186 - SC Order. Justices: Anil R. Dave and Dipak Misra. Petitioner represented by Mr. K. Radhakrishnan, Sr. Adv., Mr. Rahul Kaushik, Adv., Ms. Purnima Bhat Kak, Adv., Mrs. Anil Katiyar, Adv. Respondent: None.

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• 2013 (8) TMI 1185
  
  Issues Involved:
  1. Application for condonation of delay.
  2. Estoppel from challenging the order.
  3. Explanation for delay.
  4. Respondent's retirement and entitlement.
  5. Previous tribunal and court orders.
  6. Bona fide actions and negligence.
  
  Summary:
  
  1. Application for Condonation of Delay:
  The appellants sought condonation of a 428-day delay in filing a Letters Patent Appeal against an order dated 27th December 2011. The delay was attributed to administrative reasons, including the time taken for obtaining necessary approvals and information from various departments. The appeal was eventually filed on 26th March 2013.
  
  2. Estoppel from Challenging the Order:
  The respondent argued that the appellants were estopped from challenging the order as they had previously sought and obtained an extension of time for compliance with the same order. The respondent contended that this action implied acceptance of the order.
  
  3. Explanation for Delay:
  The appellants provided a detailed timeline of their actions, including obtaining the certified copy of the order, seeking approvals, and preparing the appeal. However, the court found that the appellants were aware of the limitation period and failed to act promptly, showing negligence and lack of bona fide.
  
  4. Respondent's Retirement and Entitlement:
  The respondent retired in June 2012 and was awaiting the benefits of a higher pay-scale effective from 30th January 1990. The respondent had initially approached the Gujarat Civil Services Tribunal, which had allowed his appeal, but the State authorities challenged the order, leading to the current proceedings.
  
  5. Previous Tribunal and Court Orders:
  The Gujarat Civil Services Tribunal had directed the authorities to grant the higher pay-scale to the respondent. This order was challenged by the State authorities and set aside by a learned Single Judge on jurisdictional grounds. The respondent then filed Special Civil Application No. 12613 of 2011, which was allowed, leading to the current appeal.
  
  6. Bona Fide Actions and Negligence:
  The court noted that the appellants, after seeking an extension of time to comply with the order, did not act promptly to file the appeal. The court emphasized that the right to appeal is a statutory remedy, but lack of bona fide and gross negligence are crucial factors in considering condonation of delay. The court cited the Supreme Court's observations in Office of the Chief Post Master General v. Living Media India Ltd., emphasizing that government departments must perform their duties with diligence and cannot expect leniency in matters of delay.
  
  Conclusion:
  The court dismissed the application for condonation of delay, finding that the appellants failed to prove sufficient cause for the delay. Consequently, the appeal was dismissed as barred by limitation, and the connected Civil Application was disposed of as infructuous. There was no order as to costs.

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• 2013 (8) TMI 1184
  
  Issues Involved:
  1. Whether the petitioner proved the consideration for the cheque issued by the respondent.
  2. Whether the respondent successfully rebutted the presumption u/s 118(a) and 139 of the Negotiable Instruments Act.
  3. Whether the appellate court erred in overturning the trial court's conviction.
  
  Summary:
  
  Issue 1: Consideration for the Cheque
  The petitioner claimed to have advanced a loan of ` 72,000/- to the respondent in December 2001, with the respondent issuing a cheque dated 4.1.2002 for repayment. The cheque was dishonored due to insufficient funds. The petitioner issued a legal notice on 26.3.2002, which the respondent replied to, claiming the cheque was stolen and payment was stopped. The trial court convicted the respondent u/s 138 of the Negotiable Instruments Act, awarding simple imprisonment and compensation. However, the appellate court found that the petitioner failed to prove the consideration for the cheque, noting the absence of evidence for the sources of the loan amount.
  
  Issue 2: Rebuttal of Presumption
  The appellate court observed that the respondent had issued stop payment instructions to his bank prior to the cheque's dishonor date. The bank clerk's testimony confirmed sufficient funds were available, and the cheque was returned due to stop payment instructions, not insufficient funds. The respondent's defense included a police report for the stolen cheque and letters to the bank, which were not adequately countered by the petitioner. The appellate court concluded that the respondent successfully rebutted the presumption u/s 118(a) and 139 of the Negotiable Instruments Act by showing a probable defense.
  
  Issue 3: Appellate Court's Decision
  The appellate court's decision to overturn the trial court's conviction was based on the petitioner's failure to prove his financial capacity to lend ` 72,000/-. The petitioner could not substantiate his claim with bank records or other evidence. The appellate court found the respondent's defense plausible and noted the petitioner's inability to prove his case beyond reasonable doubt. The High Court concurred with the appellate court's logical appreciation of evidence, dismissing the petition for leave to appeal, citing no illegality or misappreciation of facts in the appellate court's judgment.

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• 2013 (8) TMI 1183
  
  Issues involved:
  The issues involved in the judgment are the interpretation of the applicability of specific laws over general laws, the consideration of ingredients of the offence of cheating, and the determination of whether the petitioner should face trial for specific sections of the Indian Penal Code.
  
  Interpretation of specific laws over general laws:
  The petitioner's counsel argued that the offence in question should fall under Section 118 of the Delhi Cooperative Societies Act, 2003, rather than under the Indian Penal Code sections 409, 420, and 477A. It was contended that the special law should prevail over the general law. However, the court found that the nature of the allegations in the FIR did not strictly align with the parameters of the Delhi Cooperative Societies Act, 2003. The court held that the petitioner's prosecution for the offence under Section 420/477A of the Indian Penal Code was justified.
  
  Consideration of ingredients of the offence of cheating:
  The Additional Public Prosecutor for the State submitted that while the petitioner could not be prosecuted for both Section 409 and Section 420 of the Indian Penal Code simultaneously, the elements of the offence of cheating were present. It was argued that the petitioner's prosecution for the offence under Section 420/477A of the Indian Penal Code was well-founded based on the FIR and charge-sheet of the case.
  
  Determination of trial for specific sections of the Indian Penal Code:
  After hearing both sides and examining the impugned order, charge-sheet, and material on record, the court found that a prima facie case existed for the petitioner's prosecution under Section 420/477A of the Indian Penal Code. The court ruled that the petitioner could not be prosecuted simultaneously for the offence under Section 409 of the Indian Penal Code and discharged the petitioner for that offence. However, the court held that the petitioner should face trial for the offences under Section 420/477A of the Indian Penal Code. The petition and application were disposed of accordingly, with a refrain from commenting on the merits of the case to avoid prejudicing the petitioner at trial.

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• 2013 (8) TMI 1182
  
  Issues involved: Recovery of dues, connection between petitioner and respondent No. 5, justification for withholding payment.
  
  In the High Court judgment by Hon'ble Mr. Justice A.K. Goel and Hon'ble Mr. Justice A. K. Goswami, the court addressed the issue of recovery of dues where the Income Tax department sought to recover from respondent No.4 for default by respondent No.5. The court noted that the petitioner had no connection with respondent No.5 and that dues of the petitioner from respondent No.4 cannot be proceeded against for default of respondent No.5. Notice was issued to respondent No.4 for further proceedings, with dasti service permitted and a listing on 24.04.2013.
  
  An affidavit was filed by respondent No.4 stating that the petitioner and respondent No. 5 are interconnected entities. In light of this, the petitioner's counsel did not press the petition but sought liberty to establish rights in appropriate civil proceedings. The court found no objection to this course being adopted in accordance with the law, and accordingly, the petition was disposed of.

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• 2013 (8) TMI 1181
  
  Issues Involved:
  1. Quashing of proceedings u/s 482 CrPC.
  2. Allegations of defamation u/s 500 IPC.
  3. Territorial jurisdiction and compliance with Section 202 CrPC.
  4. Mens rea in defamation cases.
  
  Summary:
  
  Issue 1: Quashing of Proceedings u/s 482 CrPC
  An application was lodged u/s 482 CrPC for quashing the proceedings of case No. C-1284/2008 u/s 500 IPC pending before the Court of learned JM, 9th Court, Alipore. The petitioner argued that the proceedings were based on false allegations and should be quashed.
  
  Issue 2: Allegations of Defamation u/s 500 IPC
  The opposite party No. 2, an IPS officer, alleged that defamatory statements were made against him by the petitioners in various letters to high-ranking officials, including the Hon'ble Chief Minister, W.B. The statements accused him of misappropriating funds and abusing his position. The petitioners contended that these statements were made to protect their interests and were covered under Exceptions 8 and 9 to Section 499 IPC, thus not constituting defamation.
  
  Issue 3: Territorial Jurisdiction and Compliance with Section 202 CrPC
  The petitioners argued that the learned Magistrate did not comply with the mandatory provisions of Section 202 CrPC before issuing process, as the accused resided outside the jurisdiction of the Court. The Court found that the Magistrate failed to conduct the required inquiry, rendering the proceedings liable to be quashed.
  
  Issue 4: Mens Rea in Defamation Cases
  The Court emphasized that mens rea is essential for an offence of defamation u/s 500 IPC. It was noted that the petitioners acted in good faith to protect their interests, and no malice or intent to defame was established. The absence of mens rea meant that the continuation of the proceedings would be an abuse of the process of the Court.
  
  Conclusion:
  The Court found that the proceedings lacked compliance with Section 202 CrPC and that the allegations did not constitute defamation due to the absence of mens rea. Consequently, the proceedings of Case No. C-1286/2008 and others were quashed, as their continuation would be an abuse of the process of administration of justice.

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• 2013 (8) TMI 1180
  
  Issues Involved:
  1. Registration and validity of the Sale Certificate.
  2. Right of redemption by the borrower.
  3. Authority of the Authorised Officer to cancel the Sale Certificate.
  4. Entitlement of the auction purchaser to physical possession and changes in revenue records.
  
  Summary:
  
  1. Registration and Validity of the Sale Certificate:
  The petitioner sought a writ of mandamus to register the Sale Certificate dated 16.09.2011 and to effect changes in revenue records. The court observed that the Sale Certificate issued by the Authorised Officer under the SARFAESI Act does not require registration as per the judgments in (2007) 5 SCC 745 and AIR 2008 Madras 108. However, since the Authorised Officer is not a Civil or Revenue Officer, the Sale Certificate requires registration under Section 17(2)(xii) of the Registration Act. The petitioner's claim for mandatory registration was not pressed, and the court acknowledged that the auction purchaser derives title on confirmation of sale, making the Sale Certificate merely evidence of such title.
  
  2. Right of Redemption by the Borrower:
  The third respondent argued their right to redeem the mortgage u/s 60 of the Transfer of Property Act. The court noted that this right is available until the sale becomes absolute. Since the Sale Certificate was issued on 16.09.2011, the sale became complete, and the right of redemption was extinguished. The borrower failed to exercise this right before the sale, and no competent court or tribunal set aside the Sale Certificate.
  
  3. Authority of the Authorised Officer to Cancel the Sale Certificate:
  The court held that the Authorised Officer has no authority under the SARFAESI Act to cancel a Sale Certificate once issued. The cancellation by letter dated 08.02.2012 was without jurisdiction and violated principles of natural justice as it was done without notice to the petitioner. The court emphasized that only a competent court or tribunal could cancel the Sale Certificate.
  
  4. Entitlement of the Auction Purchaser to Physical Possession and Changes in Revenue Records:
  The court directed the respondents to hand over physical possession of the properties to the petitioner within three months and allowed the petitioner to effect changes in the revenue records. The respondents must provide necessary documents to facilitate this process. The court set aside the proceedings/letter dated 08.02.2012 and instructed the petitioner to repay the refunded amount within two weeks.
  
  Conclusion:
  The writ petition in W.P.No.4088 of 2012 was allowed, setting aside the cancellation letter, and the writ petition in W.P.No.1937 of 2012 was disposed of with directions for the respondents to assist in updating revenue records. The petition for perjury was dismissed as no arguments were advanced.

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• 2013 (8) TMI 1179
  
  Issues involved: Appeal against CIT(A) order on grounds of income enhancement without opportunity u/s 251(2), alleged concealment of income, reliance on incorrect case law, distinction between revised and corrected return, and lack of notice for income enhancement.
  
  Income enhancement without opportunity u/s 251(2): The appellant challenged the income enhancement by CIT(A) without providing an opportunity u/s 251(2) of the Income-tax Act, 1961. The appellant contended that failure to give such an opportunity vitiates the assessment and appellate order. The Tribunal held that the CIT(A) cannot enhance an assessment without affording the appellant a reasonable opportunity to show cause against such enhancement. As the appellant was not given this opportunity, the income enhancement made by the CIT(A) was deemed unsustainable in the eyes of the law. Therefore, the Tribunal deleted the enhancement amount.
  
  Alleged concealment of income: The CIT(A) had held that the appellant concealed income by furnishing inaccurate particulars, a claim disputed by the appellant. The Tribunal noted that the issue of concealment or inaccurate particulars is relevant for penalty proceedings u/s 271(1)(c) of the Act, not for the current appeal. Consequently, the Tribunal found no merit in this ground and rejected it.
  
  Reliance on incorrect case law: The appellant argued that the CIT(A) wrongly relied on a specific case law which was not applicable to the facts of the case, while ignoring a decision of the jurisdictional High Court. The Tribunal observed that the correctness of case law application is not a ground for the current appeal and thus dismissed this argument.
  
  Distinction between revised and corrected return: The appellant contended that there was a difference between a revised return and a correction of return, asserting that any errors were computation errors, not inaccurate particulars. The Tribunal held that this distinction was not relevant to the current appeal and therefore rejected this ground.
  
  Lack of notice for income enhancement: The appellant raised the issue of lack of notice for the income enhancement made by the CIT(A). The Tribunal emphasized that u/s 251(2) of the Act, the CIT(A) must provide a reasonable opportunity for the appellant to show cause against any enhancement. Since no such opportunity was given in this case, the Tribunal deemed the enhancement unsustainable and consequently deleted the same.
  
  Conclusion: The Tribunal partly allowed the appeal of the assessee, deleting the income enhancement made by the CIT(A) due to the lack of opportunity provided to the appellant. The other grounds raised were deemed irrelevant for the current appeal and were rejected.

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