Latest Updates

Posted On: 29-07-2024
303. (SC) (Decided on: 24.07.2024)

A. Negotiable Instruments Act, 1881 (26 of 1881), Section 7, 138, 141, 143A -- Drawer – Cheque bounce complaint – Interim compensation u/s 143A of NI Act -- Liability of Directors of Company -- Interpretation of -- High Court's interpretation accurately identified the "drawer" as the individual who issues the cheque -- Drawer u/s 143A refers specifically to the issuer of the cheque, not the authorized signatories -- Primary liability rests on the drawer, emphasizing the drawer's responsibility for maintaining sufficient funds -- Section 141 of the NI Act extending liability to the company's officers for the dishonour of a cheque -- Appellants' attempt to extend this principle to Section 143A, to hold directors or other individuals personally liable for interim compensation, is unfounded -- Authorized signatories act on behalf of the company but do not assume the company's legal identity.

(Para 28-30)

B. Negotiable Instruments Act, 1881 (26 of 1881), Section 7, 138, 143A -- Drawer – Cheque bounce complaint – Interim compensation u/s 143A of NI Act -- Liability of Directors of Company – Interpretation of -- When statutory language is clear and unambiguous, it should be given its natural and ordinary meaning -- Legislative intent, as discerned from the plain language of the statute, aims to hold the drawer accountable -- Appellants' argument for a broader interpretation to include authorized signatories u/s 143A contradicts this principle and would lead to an unjust extension of liability not supported by the statutory text.

(Para 31)

Posted On: 25-07-2024
316. (P&H HC) (Decided on: 03.07.2024)

A. Code of Civil Procedure, 1908 (V of 1908), Order 39 Rule 1 & 2 – Temporary injunction -- Before granting injunction, the court is required to apply three well known tests namely;

a) prima facie case in favour of the plaintiffs

b) balance of convenience

c) irreparable loss and injury which the party may suffer if the injunction is not granted.

(Para 8)

B. Code of Civil Procedure, 1908 (V of 1908), Order 39 Rule 1 & 2 – Temporary injunction – Joint owner -- Property is situated in an area which is being used for running a small scale industry -- No dispute that previously the defendants were utilising the area by constructing a shed with iron sheets -- Defendants have installed their machinery to carry out work of laundry and steam press -- Even if the defendants are permitted to put new iron or cemented sheets over the pillars, there will be no permanent change in the nature of the property -- Defendants stated that if suit is decreed and suit property falls in the share of the plaintiffs, they will not claim any compensation for the construction.

-- Decision of the suit is likely to take a long time and if the parties are not permitted to use the property, it will lead to wastage of resources.

-- If the plaintiffs succeed they will get the property with construction.

-- Parties are yet to lead evidence.

Held, Courts below have erred in obstructing the defendants from completing the renovation/ re-construction of the shed by granting injunction.

(Para 9, 10)

Posted On: 23-07-2024
319. (P&H HC) (Reserved on: 03.05.2024 Decided on: 24.06.2024)

Specific Relief Act, 1963 (47 of 1963), Section 16 – Transfer of Property Act, 1882 (4 of 1882), Section 41 -- Code of Civil Procedure, 1908 (V of 1908), Order 8 Rule 6 – Agreement to sell by brother/ attorney after death of Owner -- Plaintiffs asserted in the plaint, specifically that brother/ attorney of owner received payments from various vendees -- While filing the written statement there is no specific denial to the assertion -- In the absence of specific denial, the pleadings are deemed to have been admitted -- Moreover, two daughters of Owner while appearing in evidence, have not disputed the payment – Attorney died, children of attorney have not stepped into the witness box -- It will not be appropriate to hold that the plaintiffs have failed to prove the payment of the entire sale consideration.

-- Colony has already been carved out on the disputed property.

-- If specific performance of the agreement to sell is granted chances are that the plaintiffs would complete the colony by providing all the requisite facilities to the residents/ plot buyers.

-- Heirs of owner/ principal are settled in England and for the last 25 years, they have never bothered to take care of their property after their father passed away in the year 1991, hence, no equity lies in their favour.

-- From the testimony of both the daughters of owner, it is evident that they always treated agreement to sell to be the complete sale of the suit property.

Plaintiffs are not guilty of committing any default which may disentitle them the relief of specific performance of the agreement to sell as they being third parties unaware of the death of principal were bonafide purchasers -- Relief of specific performance of the agreement to sell granted.

(Para 1.5, 6-8.1)

Posted On: 19-07-2024
325. (P&H HC) (Decided on: 11.07.2024)

A. Bharatiya Nagarik Suraksha Sanhita, 2023 (46 of 2023), Section 1(3), 4, 531 – Procedure in criminal cases after BNSS (w.e.f. 01.07.2024):

I. The Code of Criminal Procedure, 1973 stands repealed w.e.f. 01.07.2024. Ergo; no new/fresh appeal or application or revision or petition can be filed under Code of Criminal Procedure, 1973 on or after 01.07.2024.

II. The provisions of Section 4 and Section 531 of BNSS, 2023 are mandatory in nature as a result whereof any appeal/ application/ revision/ petition/ trial/ inquiry or investigation pending before 01.07.2024 are required to be disposed of, continued, held or made (as the case may be) in accordance with the provisions of Code of Criminal Procedure, 1973. In other words; any appeal/ application/ revision/ petition filed on or after 01.07.2024, is required to be filed/ instituted under the provisions of BNSS, 2023.

III. Any appeal/ application/ revision/ petition filed on or after 01.07.2024 under the provisions of Cr.P.C., 1973 is non-maintainable & hence would deserve dismissal/ rejection on this score alone. However, any appeal/ application/ revision/ petition filed upto 30.06.2024 under the provisions of Cr.P.C., 1973 is maintainable in law. To clarify; in case any appeal/ application/ revision/ petition is filed upto 30.06.2024 but there is defect (Registry objections, as referred to in common parlance) and such defect is cured/ removed on or after 01.07.2024, such appeal/ application/ revision/ petition shall be deemed to have been validly filed/ instituted on or after 01.07.2024 and, therefore, would be non- maintainable.

IV. Section 531 of BNSS shall apply to "revision", "petition" as also "petition of complaint" (ordinarily referred to as complaint before Magistrate) with the same vigour as it is statutorily mandated to apply to "appeal/ application/ trial/ inquiry or investigation" in terms of Section 531 of BNSS.

(Para 9)

B. Constitution of India, Article 20 -- Bharatiya Nagarik Suraksha Sanhita, 2023 (46 of 2023), Section 1(3), 4, 531 – Procedure in criminal trial – Retrospective or Prospective -- Prohibition under Article 20 pertains to only conviction/ sentence under a law, which has been enacted later on, but not trial thereof -- There is no gainsaying that BNSS is essentially a criminal procedural law whereas BNS provides for substantive criminal law – It is trite law that the presumption against a retrospective construction has no application to enactments which affect only the procedure and practice of the Courts, even where the alteration which the statute makes has been disadvantageous to one of the parties -- No person has a vested right in any course of procedure -- He has only the right of prosecution or defence in the manner prescribed for the time being, by or for the Court in which he sues, and, if an Act of Parliament alters that mode of procedure, he has no other right than to proceed according to the altered mode.

(Para 8.3, 8.4)

C. Bharatiya Nagarik Suraksha Sanhita, 2023 (46 of 2023), Section 528, 531 -- Code of Criminal Procedure, 1973 (2 of 1974), Section 482 -- Indian Penal Code, 1860 (45 of 1860), Section 406, 498A – Quashing of FIR/ Report u/s 173 Cr.P.C. -- Petition u/s 482 Cr.P.C on 03.07.2024 – Maintainability of -- The Criminal Procedure Code of 1973 stands repealed w.e.f. 01.07.2024 -- Petition u/s 482 Cr.P.C. is non-maintainable, dismissed -- Petitioner shall be at liberty to file an appropriate petition invoking the provisions of BNSS, as and if permissible in law.

(Para 10)

Posted On: 16-07-2024
330. (SC) (Decided on: 09.07.2024)

A. Constitution of India, Article 12, 13, 226 -- Army Welfare Education Society / Private Educational  Institution – Service dispute – Maintainability of writ –

-- Whether the appellant Army Welfare Education Society is a “State” within Article 12 of the Constitution of India so as to make a writ petition under Article 226 of the Constitution maintainable against it?

-- Whether a service dispute in the private realm involving a private educational  institution and its employees can be adjudicated upon in a writ petition filed under Article 226 of the Constitution?

Held, High Court committed an egregious error in entertaining the writ petition holding that the appellant society is a “State” within Article 12 of the Constitution -- School run by the Appellant Society imparts education -- Relationship is that of an employee and a private employer arising out of a private contract -- If there is a breach of a covenant of a private contract, the same does not touch any public law element -- The school cannot be said to be discharging any public duty in connection with the employment of the respondents.

(Para 42, 46)

B. Doctrine of legitimate expectation -- Features :

-- First, legitimate expectation must be based on a right as opposed to a mere hope, wish or anticipation;

-- Secondly, legitimate expectation must arise either from an express or implied promise; or a consistent past practice or custom followed by an authority in its dealings;

-- Thirdly, expectation which is based on sporadic or casual or random acts, or which is unreasonable, illogical or invalid cannot be treated as a legitimate expectation;

-- Fourthly, legitimate expectation operates in relation to both substantive and procedural matters;

-- Fifthly, legitimate expectation operates in the realm of public law, that is, a plea of legitimate action can be taken only when a public authority breaches a promise or deviates from a consistent past practice, without any reasonable basis.

-- Sixthly, a plea of legitimate expectation based on past practice can only be taken by someone who has dealings, or negotiations with a public authority. It cannot be invoked by a total stranger to the authority merely on the ground that the authority has a duty to act fairly generally.

The aforesaid features, although not exhaustive in nature, are sufficient to help in deciding the applicability of the doctrine of legitimate expectation to the facts of the case.

(Para 48, 49)

C. Doctrine of legitimate expectation – Arbitrariness in State action -- It is clear that legitimate expectation, jurisprudentially, was a device created in order to maintain a check on arbitrariness in State action -- It does not extend to and cannot govern the operation of contracts between private parties, wherein the doctrine of promissory estoppel holds the field.

(Para 49)

D. Doctrine of legitimate expectation – Schol run by Society – Applicability upon -- Even if the function being performed by a private educational institution in imparting education may be considered as a public function, the relationship between the administration of such an institution and its employees remains a contractual one, falling within the ambit of private law -- No statutory obligation on the appellant society which requires that the salaries and allowances of the respondents are to be kept at par with what is payable to teachers of Government institutions -- Appellant society, for the purposes of its relationship with its employees, cannot be regarded as a public or Government authority -- Doctrine of legitimate expectation will have no applicability to the facts of the case.

(Para 50-52)

Posted On: 10-07-2024
337. (P&H HC) (Reserved on: 13.03.2024 Pronounced on: 15.04.2024)

A. Specific Relief Act, 1963 (47 of 1963), Section 20 – Specific performance of contract -- Discretion of court -- Necessary condition is that contract in itself must be legally valid and capable of enforcement, otherwise the Court’s discretion in granting or refusing its specific performance will not arise.

(Para 13)

B. Specific Relief Act, 1963 (47 of 1963), Section 20 – Contract by Guardian on behalf of the minor -- Specific performance of contract -- In order to specifically enforce a contract entered into by a guardian on behalf of the minor, it is necessary that:

(i) contract should be within the competence of the guardian to enter into on his behalf so as to bind him; and

(ii) it is for the benefit of the minor.

If either of these two conditions are not satisfied, the Contract cannot be specifically enforced at all.

(Para 16)

C. Hindu Minority and Guardianship Act, 1956 (32 of 1956), Section 6, 8, 12 – Contract by Guardian on behalf of the minor -- Minor’s undivided share in joint family property -- Permission from Guardianship court to execute sale deed – Permissibility  of -- Application u/s 8 of the Guardianship Act for appointment of guardian in itself was not maintainable -- As such, the mother of defendant No.1 was not competent to sell the share of the minor in the joint Hindu family property.

(Para 3, 17-21)

D. Specific Relief Act, 1963 (47 of 1963), Section 20 – Contract by Guardian on behalf of the minor -- Specific performance of contract – Price of property – Consideration of -- Price cannot be a reason to decline specific performance of the contract, but when the interest and benefit of the minor is involved, Court is certainly bound to see as to whether the proposed sale is in the interest and benefit of the minor or not.

(Para 24)

E. Specific Relief Act, 1963 (47 of 1963), Section 20 – Specific performance of contract -- Earnest money of agreement to sell adjusted in another property – Effect of -- Once the entire earnest money stands adjusted towards the sale consideration of part of the property agreed to be sold, the agreement of sale will not survive in respect of the remaining part of the property and will become redundant -- Specific performance of such remaining part cannot be allowed.

(Para 30)

F. Hindu Minority and Guardianship Act, 1956 (32 of 1956), Section 4, 5(b) – Majority Act, 1875 (9 of 1875), Section 3 – Repudiation of contract – Age of majority -- It is an undisputed legal proposition that a minor can repudiate the contract entered into by his guardian, on his attaining majority, as the agreement on behalf of minor is voidable -- In view of Section 5(b) of the Hindu Minority & Guardianship Act, it is held that the age of majority in this case shall be considered to be 18 years, as the contrary provision contained in Indian Majority Act, is inconsistent with Section 4 of Hindu Minority & Guardianship Act -- As such, defendant having repudiated the contract, plaintiffs-appellants cannot pray for enforcement of specific performance.

(Para 33-36)

Posted On: 07-07-2024
338. (P&H HC) (Reserved on: 03.05.2024 Decided on: 02.07.2024)

A. Specific Relief Act, 1963 (47 of 1963), Section 9 -- Punjab Tenancy Act, 1887 (XVI of 1887), Section 51 – Civil suit for possession of agricultural land -- Ejectment of tenant -- Denying title of landlord – Effect of – Jurisdiction of civil Court -- If defendants denied the title of the plaintiffs in the written statement by taking a specific plea to the effect, that will be sufficient to hold that they had denounced the title of the plaintiff -- Civil Court will have the jurisdiction to entertain the suit for possession.

(Para 10)

B. Specific Relief Act, 1963 (47 of 1963), Section 9 -- Limitation Act, 1963 (36 of 1963), Section 27 -- Punjab Tenancy Act, 1887 (XVI of 1887), Section 51 – Tenancy of agricultural land – Adverse possession – Plea of -- Effect of – Finding beyond pleadings – Permissibility of -- At no point of time, defendants ever claimed to be tenants on the suit land -- Their consistent stand taken in the written statement is that they are in possession of the suit land and had perfected their title by way of adverse possession -- Their plea of adverse possession has not been found as correct -- The First Appellate Court on its own, made out a new case for the defendants by holding them to be tenants on the suit land -- The First Appellate Court could not travel beyond the pleadings of the parties -- Even the evidence, led beyond the pleadings of the parties, could not be appreciated in that direction -- Suit decreed.

(Para 11, 13)

Posted On: 03-07-2024
342. (Allahabad HC) (Decided on: 05.06.2024)

A. Narcotic Drugs and Psychotropic Substances Act, 1985 (61 of 1985), Section 37 -- Code of Criminal Procedure, 1973 (2 of 1974), Section 439 -- NDPS Case – Regular Bail -- Commercial quantity – Rigour of Section 37 of NDPS Act – Applicability on High Court/ Supreme Court -- Provisions of Sections 36-A and 37 have to be read together and interpreted harmoniously so that Section 36-A(3) does not become redundant or otiose -- Restrictions contained in Section 37 of the NDPS Act were meant to be applicable to Courts other than the Constitutional Courts and in view of the provision contained in Section 36-A (3) of NDPS Act, those restrictions do not apply to the Constitutional Courts.

(Para 36)

B. Narcotic Drugs and Psychotropic Substances Act, 1985 (61 of 1985), Section 8, 20, 23, 29, 37, 52A, 68, 76 – Narcotic Drugs and Psychotropic Substances (Seizure, Storage, Sampling and Disposal), Rules, 2022, Rule 3, 9, 10, 11 -- Code of Criminal Procedure, 1973 (2 of 1974), Section 439 -- NDPS case – Regular bail – Commercial quantity -- Samples in presence of Magistrate – Non-compliance of – In recovery memo, packets recovered were not numbered serially for the purpose of identification, as provided in Rule 3 (2) of the 2022 Rules -- Samples were not drawn in presence of a Magistrate, as provided in Section 52-A of the NDPS Act and Rule 9 of the 2022 Rules -- Although 14 packages are claimed to have been seized from the applicant, samples have not been drawn from all the packets and a single sample has been drawn, that too not in duplicate and thus the authorities have violated Rule 10 of the 2022 Rules -- Authorities themselves have violated the mandatory provisions contained in Rules of 2022 -- Applicant has no previous criminal history and he is languishing in jail since 28.01.2024 -- Bail application allowed.

(Para 46-51)

Posted On: 03-07-2024
343. (P&H HC) (Reserved on: 27.05.2024 Decided on: 03.07.2024)

Punjab Security of Land Tenures Act, 1953 (10 of 1953), Section 2(5-a) -- Haryana Ceiling on Land Holdings Act, 1972 (26 of 1972), Section 14(1) -- Surplus land – Permissible area – Non-utilisation of – Effect of – Land declared as surplus not utilized till date as per Section 14 (1) of the Haryana Ceiling of Land Holdings Act, 1972 -- Since the holding of the plaintiff, her father and other co-sharers is still joint and the permissible area & surplus area of the plaintiff has not been separated and distinctively identified till date, so the defendant-State cannot utilize the area declared as surplus in any manner whatsoever.

-- Land declared as surplus of the plaintiff had not been allotted to any eligible tenants and thus, the proceedings have not been completed till date nor the possession has been taken from the plaintiff till date.

-- Direction given to the defendants/ State to first complete proceedings under 1953 Act regarding the declaration of the land as surplus and it is only thereafter that land of the plaintiff is to be declared as surplus or permissible as per 1972 Act by giving her the benefit of the fact that she has become an independent unit being a married lady and cannot be included as a unit of family of her father/ landowner

-- Till all these proceedings are completed, decree of injunction passed, restraining the defendant/ respondent State from dispossessing the plaintiff from any part of the suit land held by her, as was transferred to her by her father, except in due course of law.

(Para 14-17)