ISSUE-7 (MARCH 22-MARCH 28)



ISSUE VII
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CURRENT AFFAIRS (ISSUE 7 – MARCH 22 TO 28)

SUPREME COURT CASES

1.SECTION 14 OF LIMITATION ACT APPLIES TO APPLICATION UNDER SCETION 7 IBC: SC

Case: Sesh Nath Singh Vs. Baidyabati Sheoraphuli Co-operative Bank Ltd [CA 9198 OF 2019]

Facts:In this case, the National Company Law Appellate Tribunal rejected the contention raised by Corporate Debtor that since the account of the Corporate Debtor had been declared NPA on 31st March, 2013 and since the application under Section 7 of IBC had been filed on27th August, 2018, after almost five years and five months from the date of accrual of the cause of action, the application filed by financial creditor is barred by limitation. This was appealed in the apex court.

Held: A bench comprising Justices Indira Banerjee and Hemant Gupta held that Section 14 applies to an application under Section 7 of the IBC and that there is no rule that the exclusion of time under Section 14 is available, only after the proceedings before the wrong forumterminate.

It was also held that also held that SAFAESI proceedings are 'civil proceedings' for the purposes of Section 14 of the Limitation Act.

2. SUPREME COURT HOLDS ARMY'S EVALUATION CRITERIA TO GRANT PERMANENT COMMISSION FOR WOMEN OFFICERS ARBITRARY

Case: Lt Col Nitisha and others v Union of India and others


A division Bench of the Supreme Court comprising of Justice DY Chandrachud and Justice MR Shah heard a batch of pleas filed by women Army officers seeking grant of permanent commission and related benefits. . They contended that the Army denied them permanent commission, despite the ruling of the Supreme Court in the BabitaPuniya case, by applying an arbitrary threshold for medical fitness and by not considering their credentials beyond the 5th or 10th year of services.

The Supreme Court noted with dismay that the decision of the Army to not take into account the qualifications of women Short Service Commission officers beyond their 5th or 10th year of services resulted in the exclusion of "some of the finest women officers who have served the Army".The Supreme Court on Thursday declared that the evaluation criteria adopted by the Indian Army to consider the grant of permanent commission for womenofficers to be "arbitrary and irrational".The Court directed the Army to reconsider the pleas of women Short Service Commission officers for grant of PC within two months in accordance with the fresh directions issued by the Court.

3.COMPANY TRIBUNAL NOT A LABOUR COURT OR ADMINISTRATIVE TRIBUNAL TO FOCUS ENTIRELY ON REMOVAL OF DIRECTOR: SC IN TATA-MISTRY CASE

Case Name: Tata Consultancy Services Pvt Ltd v Cyrus Investments Pvt Ltd and Others (LL 2021 SC 184)

In the Tata Sons-Cyrus Mistry case, the Supreme Court observed that the Company Law Tribunal cannot interfere with the removal of a person as a Chairman of a Company in a petition under Section 241 of the Companies Act 2013, unless such removal was "oppressive or prejudicial".

Under Section 241 of the Companies Act, the National Company Law Tribunal has jurisdiction to deal with an application by a member of a company complaining that "the affairs of the company have been or are being conducted in a manner prejudicial to public interest or in a manner prejudicial or oppressive to him or any other member or members or in a manner prejudicial to the interests of the company". Section 242 of the Companies Act speaks of the kind of orders that a Company Tribunal can pass on an application under Section 241.

Mere removal of a person as Chairman of the Company, in accordance with the law and the Articles of Association, is not a subject matter under Section 241, unless it is shown to be "oppressive or prejudicial". "The Company Tribunal is not a labour Court or an administrative Tribunal to focus entirely on the manner of removal of a person from Directorship", the judgment delivered by a bench comprising Chief Justice of India SA Bobde, Justices AS Bopanna and V Ramasubramaniam observed.

4.SUPREME COURT REFUSES TO STAY ELECTORAL BONDS, SAYS SUFFICIENT SAFEGUARDS ALREADY THERE

The Supreme Court on Friday refused to stay the release of the fresh set of electoral bonds from April 1 for the assembly polls in West Bengal, Kerala, Tamil Nadu, Assam and Puducherry.

The Court dismissed the application filed by NGO Association for Democratic Reforms seeking stay of the bonds. Since the bonds were allowed to be released in 2018, 2019 and 2020 without interruption, and sufficient safeguards are there, there is no justification to stay the electoral bonds at present, the Court said in its order.

HIGH COURT CASES

1.FAILURE OF STATE TO PROVIDE BASIC SHELTER TO HOMELESS PERSONS IS VIOLATIVE OF RIGHT TO LIFE UNDER ARTICLE 21: KARNATAKA HIGH COURT


Failure of the State government to provide basic shelter to homeless persons is a violation of the right to life guaranteed under Article 21 of the Constitution of India, the Karnataka High Court said on Tuesday.

A Division bench of Chief Justice Abhay Shreeniwas Oka and Justice Suraj Govindaraj further noted “State must be conscious of the fact that its failure to provide basic shelter to urban homeless may amount to violation of Right to Life guaranteed by Article 21 of Constitution of India. If poor homeless in the cities are without shelter, it is a violation of their Right to live a dignified life guaranteed under Article 21 of the Constitution of India,” the Court said.


The Bench, therefore, directed the State government to place on record the outcome of the survey of urban homeless carried out in the State. If the survey is complete, the government will have to take appropriate decision on the number of shelters required in the State, added the Court.


The Court was hearing a petition by NGO, People's Union for Civil Liberties (PUCL) seeking implementation of State government order dated May 29, 2014 with regard to urban homeless shelters.


The counsel for the petitioner, Mohammed Afeef submitted that there are around 40 functional community centres in Karnataka with a capacity of 50-60 persons each.


The operational guidelines issued by the Central government mandate that the centres should accommodate at least 100 persons each, it was pointed out.


The petitioner also submitted that there are no special centres dedicated for children, disabled or transgenders persons as mandated under the scheme.


The Court in its order noted that out of the 64 shelters set up in the State, only 47 are functional.


“We are dealing with the issue of providing shelters to urban homeless, the second issue with which we are concerned now is making provision for night shelters. State government has filed a statement of objections. The statement of objections is silent on the survey of urban homeless in the state of Karnataka.......As per the list submitted to the court of the 64 shelters set up in the state, only 47 are functional. The capacity of functional centers in the city (Bengaluru) is not more than 300.”


During the hearing, the bench also went through an order passed by the Supreme Court in the case of PUCL v. Union of India (Writ Petition No 196/2001).


In the said case, the State of Karnataka had submitted before the Supreme Court that it would conduct a comprehensive survey to identify urban homeless.


It was also submitted that the survey would be completed in six months subsequent to which, necessary action will be taken to provide basic facilities so that urban homeless are in position to enjoy their fundamental right to lead a life with dignity.


Noting non-compliance with the said undertaking, the High Court directed the State government to place on record all data regarding the setting up of night shelters.


“As stated earlier no material is placed on record to show how many night shelters set up in the state and if the same are set up, the details of the facilities there. We direct the state government to place on record all data regarding setting up of night shelters.”


The Court also directed the government to respond to the survey report carried out by the petitioner contains a social audit of certain shelters in the city.


Further, the Court directed the petitioner to submit the report of any further survey of shelters for the homeless, carried out by it.

BILLS/ OTHER ISSUES

1. PARLIAMENT PASSES GNCTD AMENDMENT BILL TO ENHANCE POWERS OF DELHI LIEUTENANT GOVERNOR

The RajyaSabha on Wednesday passed the Government of National Capital Territory of Delhi (Amendment) Bill, 2021. The Lok Sabha passed it on Monday. The Bill enhances the power of the Lt.Governor of Delhi by declaring him as the “Government of Delhi”.

Salient features of the bill

1. It amends the GNCT of Delhi Act, 1991 and redefines Delhi Government as Lieutenant Governor

2. It curbs the Delhi Assembly's power to conduct its proceedings as per the rules of procedure made by it. It provides that the Rules made by the Delhi Legislative Assembly to regulate the procedure and conduct of business in the assembly must be consistent with the Rules of Procedure and Conduct of Business in the Lok Sabha

3. The Bill also prohibits the Legislative Assembly from making any rule to enable itself or its Committees to: (i) consider the matters of day-to-day administration of the NCT of Delhi and (ii) conduct any inquiry in relation to administrative decisions. Further, any provision in force having the above said effect will be void.

4. The Bill provides that the opinion of the LG must be obtained before taking any executive action on decisions of Delhi Government.

Oppositions

1. The Bill will subvert the elected Government of Delhi by vesting overriding powers in the LG, who works at the instructions of the Centre, and will affect cooperative federalism.

2. It was stated that since Delhi has been conferred a special status under Article 239AA of the Constitution (Special provisions with respect to Delhi),any change in the powers of the Delhi Government should be brought by way of a Constitutional Amendment only.

3. It was also alleged that the Bill is an attempt to circumvent the interpretation made by a Constitution Bench of the Supreme Court in the Delhi v. LG which held that the LG is an administrative head in the "limited sense" and that he is "bound by the aid and advise" of the Council of Ministers of Delhi Government, except in matters of land, police and public order.

2. THE NATIONAL COMMISSION FOR ALLIED AND HEALTHCARE PROFESSIONS BILL, 2020

The Minister of Health and Family Welfare, Dr. Harsh Vardhan on September 15, 2020, introduced the Nation Commission for Allied and Healthcare Professions Bill, 2020 in the Rajya Sabha. The same was passed in the Rajya Sabha on 16th March 2021 and in the Lok Sabha on 24th March 2021.

This Bill aims to provide for regulation and maintenance of standards of education and services by allied and healthcare professionals, assessment of institutions, maintenance of a Central Register and State Register, and creation of a system to improve access, research and development, and adoption of latest scientific advancement.

The Bill provides the definition of an Allied Health Professional, Healthcare Professional and specifies certain categories of allied and healthcare professions as recognized categories. It also sets up the National Commission for Allied and Healthcare Professions enumerating its constitution and functions.

Chapter VII of the Bill prescribes that no person is allowed to practice as a qualified allied and healthcare practitioner other than those enrolled in a State Register or the National Register. Any person who contravenes this provision will be punished with a fine of Rs 50,000.

CLAT-ISSUE 7

1. Article 21 of the Constitution of India lays down that no person can be denied life and liberty except according to procedure established by law. By reason of this article, the State cannot deny liberty through executive order. What does the Article impose on the State?

a) Duty

b) Liability

c) Disability

d) No Right

2. A person can be taken into custody only if there is a legislation specifying a procedure which allows the deprivation of liberty. This protection from wrongful arrest granted to people is:

a)An immunity

b) A liberty

c) A disability

d) A power

3. The Civil Procedure Code lays down the conditions that have to be fulfilled before a Plaint can be filed or defended. These conditions impact on the individual‘s:

a) Claim

b) Power

c) Disability

d) Liability

4. As a rule, only States can move international institutions for the enforcement of their rights. Special requirements have to be fulfilled before individuals can move international institutions. These requirements impact on the __________ of individuals to obtain their rights.

a) Liberty

b) Power

c) Claim

d) Immunity

5. Recognition of the Right to Privacy by the Indian Supreme Court has:

a) Converted a liberty into a claim right.

b) Placed a duty on the State to protect the right

c) Prevented tate from undertaking any activity which intruded on the privacy of the people

d) All of the above

CLAT ANSWERS

1. OPTION C

2. OPTION A

3. OPTION B

4. OPTION B

5. OPTION D

JUDICIAL SERVICE EXAMINATION QUESTIONS

Qn.31. In a petition to set aside the exparte decree, the Court allowed the petition subject to payment of costs within 7 days of the order. Cost was not paid in time and the petition was dismissed. After a period of 30 days, the petitioner filed an application seeking time to extend the payment of cost. Which of the following statements is correct?

(A) The petition cannot be entertained by the Court as the court has become functus officio

(B) The petition can be entertained

(C) The petition can be entertained only along with application under Section 5 of The Limitation Act

(D) The period of 30 days provided in Section 148 of CPC is mandatory hence petition filed after 30 days is not maintainable

Ans:(B) The petition can be entertained

Relevant provision:

Section 148 of the Civil Procedure Code (hereinafter referred to as CPC) gives power to the Court for the enlargement of time fixed by it with regard to the doing of an act prescribed or allowed by the CPC. Following the Amendment of 1999, the time permitted to be enlarged was limited to thirty days. In Evoke Building Concepts Pvt Ltd v. Hindware Home Retail Pvt Ltd the Delhi High Court laid down that in case of amendment of Counter-claim, if the same was an integral part of the defence, a rigid interpretation of the Section was not to be taken and the Court could extend the time beyond thirty days.

The decision of the Supreme Court in Salem Advocate Bar Association, Tamil Nadu v. Union of India [AIR 2005 SC 3353] was relied on where the question was whether, following the Amendment of the CPC in 1999, the Court had inherent powers to extend the time beyond thirty days. The Apex Court had noted that the Section had to be allowed to operate entirely, since its rigid operation would lead to absurdity. In instances where the act could not be completed within the given time due to factors beyond the control of the party, the Court would be well within its power to permit such an extension. The Court also provided a word of caution that the same was applicable to those circumstances only where the time was granted by the Court for the performance of an act and not where the time was stipulated by the Limitation Act.

Qn.32.Due to the Commercial Courts Act, Commercial Division and Commercial Appellate Division of High Courts (Amendment) Act, 2018, “Specified Value”, in relation to a commercial dispute reduced/ substituted from one crore rupees to:

(A) Four lakh rupees

(B) Five lakh rupees

(C) Three lakh rupees

(D) Six lakh rupees

Ans: C) Three lakh rupees

Provision: section 3 of commercial courts, commercial division and commercial appellate Division of High Courts Act, 2015 deals with Constitution of commercial courts.

Section 3(1) states that “The State Government, may after consultation with the concerned High Court, by notification, constitute such number of Commercial Courts at District level, as it may deem necessary for the purpose of exercising the jurisdiction and powers conferred on those Courts under this Act:

Provided that with respect to the High Courts having ordinary original civil jurisdiction, the State Government may, after consultation with the concerned High Court, by notification, constitute Commercial Courts at the District Judge level:

Provided further that with respect to a territory over which the High Courts have ordinary original civil jurisdiction, the State Government may, by notification, specify such pecuniary value which shall not be less than three lakh rupees and not more than the pecuniary jurisdiction exercisable by the District Courts, as it may consider necessary.

(1A) Notwithstanding anything contained in this Act, the State Government may, after consultation with the concerned High Court, by notification, specify such pecuniary value which shall not be less than three lakh rupees or such higher value, for whole or part of the State, as it may consider necessary.”

The provisos to the sub clause 1 has been substituted by amendment act 2018.

Explanation:

Commercial dispute can be defined as ‘disputes arising out of transactions of trade or commerce and, in particular, disputes arising out of ordinary transactions of merchants, bankers and traders such as those relating to enforcement and interpretation of mercantile documents, export or import of merchandise, affreightment, carriage of goods, franchising, distribution and licensing agreements, mercantile agency and mercantile usage, partnership, technology development, maintenance and consultancy agreements, software, hardware, networks, internet, website and intellectual-property such as trademark, copyright, patent, design, domain names and brands, and such other commercial disputes which the High Court may notify.

The main object and purpose of establishment of commercial court is to ensure that commercial cases are disposed of expeditiously, fairly and at reasonable cost to litigants.

The 2018 amendment to change in valuation has been a relief for many micro and small enterprises. For businesses with lesser valuation, this is a blessing as they don’t have to spend all their already infinitesimal resources into litigation which goes on for years at a starch with no results.

Qn.33.In a suit for partition, the plaintiff claims 1/3 share from defendants 1 and 2, Which among the following is correct:

Statement 1.A defendant can make a counter claim in a partition suit.

Statement 2. A defendant can make a counter claim against another defendant

Statement 3. The defendant making counter claim can file an application to implead parties in the suit

Statement 4. The plaintiff being dominus litus can alone maintain a petition to Implead parties

(A) All the four statements are correct

(B) Statements 1 to 3 are correct

(C) Statements 1 and 2 are correct

(D)Statement 1 alone is correct

Answer: (B) Statements 1 to 3 are correct

Explanation:

In a court of law, a party's claim is a counterclaim if one party asserts claims in response to the claims of another. In other words, if a plaintiff initiates a lawsuit and a defendant responds to the lawsuit with claims of his or her own against the plaintiff, the defendant's claims are “counterclaims.”

The very language of Order VIII Rule 6(A) of C.P.C., shows that a defendant in a suit can seek for a counter-claim. Such counter-claim will have the same effect as a cross-suit, so as to enable the Court to pronounce a final judgment in the same suit, both on the original claim and on the counter- claim.

When a defendant in a partition suit can be considered to be a person suing, then a counter claim can also be made against such defendant by another co-defendant. In fact, when a counter claim is made, the person viz., the defendant who makes such claim becomes the plaintiff insofar as that claim is concerned and person against whom such claim is made becomes the defendant. Sub-clause (2) of Rule 6A of Order 8 CPC makes it clear that such counter claim shall have the same effect as a cross suit. Even if the plaintiff in the said suit discontinues or the suit itself is stayed or dismissed, still the counter claim can be proceeded with as contemplated under Order 8 Rule 6D . Therefore a combined reading of Order 8 Rule 6A(2) with Order 8 Rule 6D makes it abundantly clear that the counter claim in a partition suit can be made even against the co-defendant.

Dominus litus is the person to whom a suit belongs. This also means master of a suit. The person has real interest in the decision of a case. It is this person who will be affected by the decisionin a case. This person derives benefits if the judgment is in his favour, or suffers the consequences of an adverse decision. Doctrine of “Dominus litus” is applied to one, who though not originally a party has made himself such, by intervention or otherwise, and has assumed the entire control and responsibility for one side and it is treated by the court as liable for costs and a person who is really and directly interested in the suit as a party. The principles governing the power of the court under Order 1, Rule 10 of C.P.C., are that as a rule the court should not add a person as a defendant in a suit when the plaintiff is opposed to such addition. The reason is that the plaintiff is the “dominus litus”. He cannot be compelled to fight against a person against whom he does not wish to fight and against whom he does not claim any relief.

It is for the plaintiff to choose a party as a defendant since he is the “dominus litis” and no one can force the plaintiff to add any party as a defendant in the suit. This concept will not strictly apply in a suit for partition since in such a suit, even the defendants can be considered as plaintiffs as they are claiming shares in the property.

The test for determining as to whether a party should be impleaded in a suit, will depend upon the fact as to whether they are necessary/proper party. Necessary party is one, without whom no effective order can be made. Proper party is one, whose presence is necessary for a complete and final decision. It must be borne in mind that a person having relevant evidence may be a necessary witness, but not a proper party to be impleaded in a suit.

Qn.34.A suit was decreed ex parte by the Sub Court, Tiruppatur. The subject matter of the suit now falls within the territorial jurisdiction of the Sub- Court, Vaniyampadi after its constitution. The defendant files a petition under Order 9 Rule 13 of C.P.C in Sub Court, Vaniyampadi. Which of the following provision confers jurisdiction on Vaniyampadi court to entertain the application.

(A) Section 37 of CPC

(B) Section 150 of CPC

(C) Section 141 of CPC

(D) Section 24 of CPC

Ans: C) Section 141 of CPC

Relevant provision:

141. Miscellaneous proceedings.—The procedure provided in this Code in regard to suits shall be followed, as far as it can be made applicable, in all proceedings in any Court of civil jurisdiction. [Explanation.— In this section, the expression “proceedings” includes proceedings under Order IX, but does not include any proceedings under article 226 of the Constitution

Explanation:

The legal maxim, Ubi Jus Ibi Remedium meaning Wherever there is a right, there is a remedy has also been adopted by our Indian legal system which is the fundamental principle of English law. Jurisdiction is also a power or right guaranteed by the court of law in order to interpret, hear and determine a cause of action an accordingly pass a judgment on a matter.

Territorial or local jurisdiction, the geographical limits of a court’s authority are clearly delineated and specified. It cannot exercise authority beyond that geographical/ territorial limit. Furthermore, Section 16 of the Code of Civil Procedure explains the territorial jurisdiction on the grounds of the location of the immovable property.

In the case of Harshad Chiman Lal Modi Vs D.L.F Universal Ltd , the court interpreted Section 16 that the suit pertaining to immovable property should be brought to the court. The court does not have the power to decide the rights of property which are not situated. However, the court can still pass a relief if the opposite party agrees to try the suit in such a case.

Qn.35. A and B are brothers. B resides in the joint family property. A files a suit for partition against B. Which of the following statements is correct.

(A) A can claim mesne profits from the date of suit

(B) A can claim mesne profits even for the period prior to suit

(C) A cannot claim mesne profits

(D) Only after preliminary decree is passed, mesne profits can be claimed

Answer : (C) A cannot claim mesne profits

Relevant Section :

Section 2 (12) of the Code of Civil Procedure provides that: “Mesne profits” of property means those profits which the person in wrongful possession of such property actually received or might with the ordinary diligence have received therefrom, together with interest on such profits but shall not include profits due to improvement made by the person in wrongful possession.

Order 20 Rule 12: Decree for possession and mesne profits.- (1) Where a suit is for the recovery of possession of immovable property and for rent or mesne profits, the court may pass a decree—

(a) for the possession of the property;

(b) for the rents which have accrued on the property during the period prior to the institution of the suit or direction an inquiry as to such rent;

(ba) for the mesne profits or directing an inquiry as to such mesne profits;

(c) directing an inquiry as to rent or mesne profits from the institution of the suit until—

(i) the delivery of possession to the decree holder,

(ii) the relinquishment of possession by the judgment debtor with notice to the decree holder through the court, or

(iii) the expiration of three years from the date of the decree, whichever event first occurs.

(2) Where an inquiry is directed under clause (b) or clause (c), a final decree in respect of the rent or mesne profits shall be passed in accordance with the result of such inquiry.

Explanation:

Mesne profit is a positive right available against infringement of private legal right. The main object of awarding mesne profit is to compensate the actual owner of the property for all the loss he has suffered.

The term ‘mesne profits’ relates to the damages or compensation recoverable from a person who has been in wrongful possession of immovable property. The Mesne profits are nothing but a compensation that a person in the unlawful possession of others property has to pay for such wrongful occupation to the owner of the property.

In Phiraya Lal alias Piara lal v. Jia Rani Hon’ble Delhi high Court while defining the term mesne profits observed that, “when damages are claimed in respect of wrongful occupation of immovable property on the basis of the loss caused by the wrongful possession of the trespasser to the person entitled to the possession of the immovable property, these damages are called mesne profits”.

A partition suit in which a preliminary decree has been passed is still a pending suit and the rights of the parties have to be adjusted as on the date of the final decree. ... The concept of 'mesne profits' is applicable to cases of wrongful possession and not partition.

It has been held by the Full Bench decision of the Madras High Court in BABBURU BASAVAYYA AND ORS. v. GURAVAYYA AND ANR., (AIR) (38) 1951 MADRAS 938) - as follows:- It is necessary at the outset to distinguish between three different types of cases in which a question of profits or mesne profits might arise: (1) Suits for ejectment or recovery of possession of immovable property from a person in possession without title, together with a claim for past or past and future mesne profits. (2) Suits for partition by one or more tenants in-common against others with a claim for account of past or past and future profits. (3) Suits for partition by a member of a joint Hindu family with a claim for an account from the manager.

In the 3rd case, the plaintiff must take the joint family properly as it exists at the date of the demand for partition and is not entitled to open up past accounts or claim relief on the ground of past inequality of enjoyment of the profit, except where the manager has been guilty of fraudulent conduct or misappropriation. The plaintiff would, however, be in the position of a tenant-in-common from the date of severance in status and his rights would have to be worked out on that basis.


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