Monthly Archives: November 2018

Order for Maintenance – Cannot be Set Aside if the Wife refuses to stay with husband

In the case of Saranan Banerjee v. State of Jharkhand, 2007 (2) AIR 82 (Jhar), it was held that an order of maintenance would not be set aside merely on the ground that wife refused to live with the husband despite decree for conjugal rights where she alleges torture and ill-treatment. It was further held as under:

       “Finally it has been submitted that since the wife is not ready to live with her husband in spite of conciliation and efforts taken by the court and also in view of the decree of restitution of conjugal rights as claimed by the husband, the wife is not entitled to maintenance at all.

       The husband had obtained a decree under section 9 of the Hindu Marriage Act for restitution of conjugal rights as against the wife and in spite of conciliation and efforts she was not inclined to live with her husband on the plea that a case for the offence under Section 498-A, IPC was pending against the husband on the allegation of torture, misbehavior, demand of dowry and many other allegations and for such reason she was apprehensive at the hands of her husband. The judgment and decree under Section 9 of the Hindu Marriage Act for restitution of conjugal rights is a decree, which cannot be executed by force. Therefore the maintenance amount awarded to the wife and her daughter cannot be sweeped and set aside only on the ground that she was not inclined to abide by the decree of the restitution of conjugal rights passed against her. Vimal Kumar Verma v. Kavita Verma, 2018 (105) ACC 394.

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Injunction To Restrain Encashment of a Bank Guarantee – Principles of

In Himadri Chemicals Industries Ltd. v. Coal Tar Refining Company, (2007) 8 SCC 110, the Hon’ble Apex Court has crystallized the principles which should be followed in the matter of injunction to restrain encashment of a Bank Guarantee or a letter of credit and it was held as under:

       “(1) While dealing with an application for injunction in the course of commercial dealings, and when an unconditional bank guarantee or letter of credit is given or accepted, the beneficiary is entitled to realize such a bank guarantee or a letter of credit in terms thereof irrespective of any pending disputes relating to the terms of the contract.

       (2) the bank giving such guarantee is bound to honour it as per the terms irrespective of any dispute raised by its customer.

       (3) The courts should be slow in granting an order of injunction to restrain the realization of a Bank Guarantee or a Letter of Credit.

       (4) Since a Bank Guarantee or a Letter of Credit is an independent and a separate contract and is absolute in nature, the existence of any dispute between the parties to the contract is not a ground for issuing an order of injunction to restrain enforcement of Bank Guarantees or Letters of Credit.

       (5) Fraud of an egregious nature which would vitiate the very foundation of such a Bank Guarantee or Letter of Credit and the beneficiary seeks to take advantage of the situation.

       (6) Allowing encashment of an unconditional Bank Guarantee or a Letter of Credit would result in irretrievable harm or injustice to one of the parties concerned.”

       In Adani Agri Fresh Ltd. v. Mahaboob Sharif and Others, (2016) 14 SCC 517, it was held that bank guarantee is an independent contract between bank and the beneficiary thereof. Bank is always obliged to honour its guarantees as long as it is an unconditional and irrevocable one. The dispute between the beneficiary and the party at whose instance bank has given guarantee is immaterial and of no consequence.

       In Mahatma Gandhi Sahakra Sakkare Karkhane v. National Heavy Engineering Corporation Ltd., (2007) 6 SCC 470, it was held that if bank guarantee is an unconditional and irrevocable one, it is not open to the bank to raise any objection whatsoever to pay the amounts under the guarantee. The person in whose favour guarantee is furnished by the bank cannot be prevented by way of an injunction in enforcing the guarantee in terms of the agreement entered between the parties has not been fulfilled. M/s Drake & Skull Water Energy India Pvt. Ltd. v. Paschimanchal Vidyut Vitran Nigam Ltd., 2008 (128) ALR 843.

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Compassionate Appointment – Not Pecuniary Advantage under the Motor Vehicles Act

In Vimal Kanwar v. Kishore Dan, (2013) 7 SCC 476, while deciding the issue “whether the salary receivable by the claimant on compassionate appointment comes within the periphery of the Motor Vehicles Act to be termed as “Pecuniary Advantage” liable for deduction, it was held as under:

       “Compassionate Appointment” can be one of  the conditions of service of an employee, if a scheme to that effect is framed by the employer. In case, the employee dies in harness i.e., while in serviceleaving behind the dependants, one of the dependants may request forcompassionate appointment to maintain the family of the deceased employee whodies in harness. This cannot be stated to be an advantage receivable by the heirs on account of one’s death and have no correlation with the amount receivable undera statute occasioned on account of accidental death. Compassionate appointmentmay have nexus with the death of an employee while in service but it is notnecessary that it should have a correlation with the accidental death. Anemployee dies in harness even in normal course, due to illness and to maintain thefamily of the deceased one of the dependants may be entitled for compassionateappointment but that cannot be termed as “pecuniary advantage” that comes underthe propriety of the Motor Vehicles Act and any amount received on suchappointment is not liable for deduction for determination of compensation underthe Motor Vehicles Act. Smt. Suman v.Himanshu, 2018 (130) ALR 503.

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Substantial Question of Law

In Santosh Hazari v. Purushottam Tiwari, (2001) 3 SCC 179, the Hon’ble Supreme Court considered what the phrase “substantial question of law” means as under:

       “The phrase is not defined in the CivilProcedure Code. The word “substantial”, as qualifying question of law, means of having substance, essential, real, of sound worth, important or considerable.It is to be understood as something in contradistinction with technical, of no substances or consequence, or academic merely.”

       A full bench of the Hon’ble Madras HighCourt in Rimmalapudi Subba Rao v. Noony Veeraju, AIR 1951 Mad 969 observed as under:

       “When a question of law is fairly arguable, where there is room for difference of opinion or where the court thought it necessary to deal with that question at some length and discuss an alternative view, then the question would be a substantial question of law. On the other hand, if the question was practically covered by decision of highest court or if general principles to be applied in determining the question are well settled and the only question was of applying those principles to the particular fact of case, it could not be a substantial question of law.”

       It was further observed in Santosh Hazari v. Purushottam Tiwari, (2001) 3 SCC 179 as under:

       “A point of law which admits of no two opinions may be a proposition of law but cannot be a substantial question of law. To be substantial, a question of law must be debatable, not previously settled by law of the land or a binding precedent, and must have a material bearing on the decision of the case, if answered either way, in so far as the rights of the parties before it are concerned. To be a question of law involving in the case there must be first a foundation for it laid in the pleadings and the question should emerge from  the substantial findings of fact arrived at by court of facts and it must be necessary to decide that question of law for a just and proper decision of the case. An entirely new point raised for the first time before the High Court is not a question involved in the case unless it goes to the root of the matter. I twill, therefore, depend on the facts and circumstances of each case whether a question of law is a substantial one and involved in the case, or not; the paramount overall consideration being the need for striking a judicious balance between the indispensable obligation to do justice at all stages and impelling necessity of avoiding prolongation in the life of any lis.” Ajay Kumar Jaiswal v. Sanjay Kumar Jaiswal, 2018 (130) ALR408.

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Filed under Civil Law, Question of Law

Section 43 of the Information Technology Act – Pre-requisites to Enforce Liability

Section 43 of the Information Technology Act, 2000, right at the outset provides for pre-requisites to enforce the liability under the section. The two requirements for invocation of this section are as follows:
(i) The acts committed under this section must have been committed without the permission of the owner or any person who is in charge of Computer, Computer System, Computer Network;
(ii) There must be some kind of damage caused to the person affected by such acts;

Section 43 of the act provides for certain set of acts, if committed by any person without the permission of the owner or person in charge of a Computer, Computer System or Computer Network, commits any of the acts provided under the sub-sections (a) to (j) of Section 43 of the Act, the person is liable to pay damages by way of compensation to the person affected. It provides for remedy in the form of compensation to the victim. But that is not the only remedy under the Act of 2000 for the victim.

The reference can also be made to Section 47 of the Information Technology Act which provides for factors to be taken into account by the Adjudicating Authority while adjudicating the quantum of compensation under Section 43 of the Act. Section 47 provides for three different factors which are as follows:
(a) The amount of gain or unfair advantage, wherever quantifiable, made as a result of the default;
(b) The amount of loss caused to any person as a result of default;
(c) Repetitive nature of the default.

Section 43 of the Act requires that the act of default must have been committed without the permission of the person who is owner or a person in charge of the Computer, Computer System or Computer Network. Secondly the act of the defendant must have caused some damage or loss to the person so affected. Amit Kumar Jadaun v. State of U.P., 2018 (130) ALR 877.

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Jurisdiction – Meaning of

Jurisdiction is the authority or power of the Court to deal with a matter and make an order carrying binding force in the facts. In support of judicial opinion for this view reference may be made to the Permanent Edition of “Words and Phrases” Vol. 23-A at P. 164. It would be appropriate to refer to two small passages occurring at pp. 174 and 175 of the volume. At p. 174, referring to the decision in Carlile v. National Oil & Dev. Co., 83 Okla 217 : 201 P 377 (1921), it has been stated:
“Jurisdiction is the authority to hear and determine, and in order that it may exist, the following are essential: (1) A court created by law, organized and sitting; (2) authority given to it by law to hear and determine causes of the kind in question; (3) power given to it by law to render a judgment such as it assumes to render; (4) authority over the parties to the case if the judgment is to bind them personally as a judgment in personam, which is acquired over the plaintiff by his appearance and submission of the matter to the court, and is acquired over the defendant by his voluntary appearance, or by service of process on him; (5) authority over the thing adjudicated upon its being located within the court’s territory, and by actually seizing it if liable to be carried away; (6) authority to decide the question involved, which is acquired by the question being submitted to it by the parties for decision.” State of Jharkhand v. Hindustan Construction Company Ltd., (2018) 2 SCC 602.

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Arbitral Tribunal – Powers Under Section 17 of the Act

 

Under Section 17, the Arbitral Tribunal has the power to order interim measures of protection, unless the parties have excluded such power by agreement. Section 17 is an important provision, which is crucial to the working of the arbitration system, since it ensures that even for the purposes of interim measures, the parties can approach the Arbitral Tribunal rather than await orders from a court. The efficacy of Section 17 is however, seriously compromised given the lack of any suitable statutory mechanism for the enforcement of such interim orders of the Arbitral Tribunal.

In Sundaram Finance Ltd. v. NEPC India Ltd. [Sundaram Finance Ltd.v. NEPC India Ltd., (1999) 2 SCC 479], the Hon’ble Supreme Court observed that though Section 17 gives the Arbitral Tribunal the power to pass orders, the same cannot be enforced as orders of a court and it is for this reason only that Section 9 gives the court power to pass interim orders during the arbitration proceedings. Subsequently, in Army Welfare Housing Organisationv. Sumangal Services (P) Ltd. [Army Welfare Housing Organisation v. Sumangal Services (P) Ltd., (2004) 9 SCC 619] , the Court had held that under Section 17 of the Act no power is conferred on the Arbitral Tribunal to enforce its order nor does it provide for judicial enforcement thereof.

In the face of such categorical judicial opinion, the Hon’ble Delhi High Court attempted to find a suitable legislative basis for enforcing the orders of the Arbitral Tribunal under Section 17 in Sri Krishan v. Anand [Sri Krishan v. Anand, 2009 SCC OnLine Del 2472 : (2009) 112 DRJ 657 : (2009) 3 Arb LR 447] [followed in Indiabulls Financial Services Ltd. v. Jubilee Plots & Housing (P) Ltd. [Indiabulls Financial Services Ltd. v. Jubilee Plots & Housing (P) Ltd., 2009 SCC OnLine Del 2458] ]. The Delhi High Court held that any person failing to comply with the order of the Arbitral Tribunal under Section 17 would be deemed to be “making any other default” or “guilty of any contempt to the Arbitral Tribunal during the conduct of the proceedings” under Section 27(5) of Act. The remedy of the aggrieved party would then be to apply to the Arbitral Tribunal for making a representation to the court to mete out appropriate punishment. Once such a representation is received by the court from the Arbitral Tribunal, the court would be competent to deal with such party in default as if it is in contempt of an order of the court i.e. either under the provisions of the Contempt of Courts Act or under the provisions of Order 39 Rule 2-A of the Code of Civil Procedure, 1908. Alka Chandewar v. Shamshul Ishrar Khan, (2017) 16 SCC 119 

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