Important Judgments

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Reverse Burden of Proof on Accused in Criminal Trials: Is there scope for a challenge to Section 30(2) of the Protection of Children from Sexual Offences Act, 2012? – By Satyam Thareja

22 hours ago 0Comments 37Views

The golden rule for criminal jurisprudence is that accused is presumed to be innocent unless proven guilty for the charged offence. The accuser / prosecution has to discharge the “burden of proof” beyond reasonable doubt to establish the guilt of the accused whereas an accused has to discharge the “burden of proof” on preponderance of probabilities to create reasonable doubt. This emanates from the above-stated golden rule, which in corollary implies that a reasonable doubt benefits the accused.

The phrase “burden of proof” refers to the obligation of accuser / prosecution or accused to establish facts material for the case in particular. The “burden of proof”, whether discharged or not depends on multitude of facts brought to the notice of the Court. These facts may be held to be “proved”, “not proved” or “disproved”. The test to judge if a fact has been “proved”, “not proved” or “disproved” is that of a prudent man. It has to be assumed by a Court from the point of view of a hypothetical prudent man, if a particular fact brought to the notice of the Court is so probable that it must have happened or may / may not have happened or could not have happened. It is from this point of view that a Court has to state if a particular fact is “proved” i.e. it must have happened, or “not proved” i.e. may / may not have happened or “disproved” i.e. could not have happened.

An exception has been made to this general rule by way of statutes providing for statutory presumptions. The Supreme Court of India has been presented with several challenges qua provisions in several statutes which provide for presumptions to be drawn against accused persons, which are covered by judgments rendered in VD Jhangan v. State of UP [1], Veeraswami v. Union of India [2], PN Krishna Lal v. Govt. of Kerala [3] & Kusum Exports v. Sharma Carpets [4] wherein it has been observed that the statutory presumptions are constitutional with a caveat that, at first, the accuser / prosecution has to establish existence of all foundational facts on preponderance of probabilities.

The jurisprudence qua the “burden of proof” on accused emanates from Sections 101 to 106 of the Indian Evidence Act, 1872 (hereinafter referred to as “IEA”). This jurisprudence, predominantly, as it emerged during research, evolved qua Section 105 of IEA which is reiterated herein below:-

Section 105 IEA

“Burden of proving that cause of accused comes within exceptions. – When a person is accused of any offence, the burden of proving the existence of circumstances bringing the case within any of the General Exceptions in the Indian Penal Code, (45 of 1860), or within any special exception or proviso contained in any other part of the same Code, or in any law defining the offence, is upon him, and the Court shall presume the absence of such circumstances. …”

This section was discussed by Rangoon High Court in its judgment in King Emperor v. U Damapala [5] (Rangoon High Court) wherein it was observed that,

“There has been in some quarters much confusion as to the meaning of the words “the burden of proof”. In criminal cases the burden of proof, using the phrase in its strictest sense, is always upon the prosecution and never shifts whatever the evidence may be during the progress of the case: if on a review of all the evidence the prosecution has failed to establish the guilt of the accused beyond reasonable doubt, he is entitled to be acquitted. ….

Now, it is not for the prosecution to examine all the possible defences which might be put forward on behalf of an accused person and to prove that none of them applies….

…the test is not whether the accused has proved beyond all reasonable doubt that he comes within any exception to the Indian Penal Code, but whether in setting up his defence he has established a reasonable doubt in the case for the prosecution and has thereby earned his right to an acquittal.”

This judgment placed reliance on the judgment of House of Lords rendered in Woolmington v. Director of Public Prosecutions [6], in which it was observed that,

“.. Juries are always told that, if conviction there is to be, the prosecution must prove the case beyond reasonable doubt. This statement cannot mean that in order to be acquitted the prisoner must “satisfy” the jury. This is the law as laid down in the Court of Criminal Appeal in Rex v. Davies (2), the headnote of which correctly states that where intent is an ingredient of a crime there is no onus on the defendant to prove that the act alleged was accidental. Throughout the web of the English Criminal Law one golden thread is always to be seen, that it is the duty of the prosecution to prove the prisoner’s guilt subject to what I have already said as to the defence of insanity and subject also to any statutory exception. If, at the end of and on the whole of the case, there is a reasonable doubt, created by the evidence given by either the prosecution or the prisoner, as to whether the prisoner killed the deceased with a malicious intention, the prosecution has not made out the case and the prisoner is entitled to an acquittal.”

Subsequently, a bench of seven judges of Allahabad High Court in Emperor v. Parbhoo [7], dealt with the question that,

“Whether having regard to Section 96 of the Indian Penal Code and Section 105 of the Indian Evidence Act, in a case in which any general exception in the Indian Penal Code is pleaded by an accused person and evidence is adduced to support such plea, but such evidence fails to satisfy the court affirmatively of the existence of circumstances bringing the case within the general exception pleaded, the accused person is entitled to be acquitted if upon a consideration of the evidence as a whole (including the evidence given in support of the plea of the said general exception) a reasonable doubt is created in the mind of the court whether the accused person is or is not entitled to the benefit of the said exception?”

This question was answered in affirmative by a majority of 4:3, the excerpts of opinions expressed in this judgment are reiterated below:-

by Majority (Iqbal Ahmed C.J.)

“.. The question referred formed the subject of consideration by a Full Bench of the Rangoon High Court in King – Emperor v. U Damapala (1) and it was held that even if the evidence adduced by the accused fails to prove the existence of circumstances bringing the case within the exception pleaded, the accused is entitled to be acquitted if, upon a consideration of the evidence both for the prosecution and the defence, the court is left in a state of reasonable doubt as to whether the accused persons is or is not entitled to the benefit of the exception pleaded. The Full Bench followed the recent English case in the House of Lords of Woolmington v. Director of Public Prosecutions (1) and held that that decision was in no way inconsistent with the law in British India and the principles laid down in that decision formed a valuable guide to the correct interpretation of section 105 of the Indian Evidence Act. ….

…..

To my mind the concluding portion of section 105 means no more than this, that in considering the evidence for the defence relating to an “exception” or “proviso” pleaded by the accused the court must start with the assumption that circumstances bringing the case within the “exception” or “proviso” do not exist. It must then decide whether the burden of proof has or has not been discharged by the accused. If it answers the question in the affirmative it must give effect to its conclusion by acquitting the accused or punishing him for the lesser offence. If, on the other hand, it holds that the burden has not been discharged, it cannot from that conclusion jump to the further conclusion that the existence of circumstances bringing the case within the exception or proviso has been disproved. All that it can do in such a case is to hold that those circumstances are “not proved”. It would be noted that section 3 draws a distinction between the words “proved”, “disproved” and “not proved”. It enacts that “a fact is said not to be proved when it is neither proved nor disproved”. The burden of bringing his case within an “exception” or “proviso” is put on the accused by section 105, but there is no provision in the Act to justify the conclusion that the failure to discharge that burden is tantamount to disproof of the existence of circumstances bringing the case withing the “exception” or “proviso” pleaded.

……

My answer to the question referred, therefore, is that the accused person is entitled to be acquitted, if upon a consideration of the evidence as a whole (including the evidence given in support of the plea of the said general exception) a reasonable doubt is created in the mind of the court whether the accused person is or is not entitled to the benefit of the said exception. …”

by Minority (Allsop J.)

“… This reference has arisen out of the decision of the Rangoon High Court in King – Emperor v. U Damapala (I), which was based in part upon the decision of the House of Lords in Woolmington’s case (2), The Rangoon High Court seems to have held that the provisions of section 105 of the Indian Evidence Act meant only that the accused was bound to produce some evidence and that, after the production of the evidence, if the court remained in doubt, it would hold that the accused had not proved that he acted on self defence, but would still go back to the original burden upon the prosecution and hold that prosecution had failed to prove that the accused had not acted in exercise of the right of private defence and would, therefore, give the accused the benefit of the doubt. With the greatest deference to the learned Judges who decided that case it seems to me that they have laid down a proposition which would imply that a court in the same proceeding could record two contradictory findings upon a fact in issue in that proceeding. ……………..

For the reasons which I have given, my answer to the question would be that an accused person is not entitled to the benefit of any exception merely because there is a reasonable doubt in the mind of the court about the existence of circumstances bringing the case within the exception. As I have already explained, I think that the meaning of the sections of the Indian Evidence Act is that every issue of fact has to be proved by one or other party, the burden of proof being laid on that party, and that the non-production of evidence or production of insufficient evidence by that party would lead the court to decide the issue of fact against him. In my judgment there is a distinction between proof and the mere adduction of evidence. I do not think that it is justifiable to hold that the burden of proof is on one party until he adduces evidence and then shifts to the other party. I think each issue must be decided at the conclusion of the proceedings once and for all. If the court says that the burden of proving the absence of circumstances which would justify the accused in pleading the protection of a general exception is upon the prosecution, then in the absence of any evidence one way or the other or any pleading on the part of the accused, the prosecution would fail and the accused would be entitled to an acquittal – a result which I consider would in many cases lead to a grave failure of justice. I do not think it is possible, under the provisions of the Indian Evidence Act to hold that the prosecution, in the absence of evidence of circumstances which would entitle the accused to an acquittal on the ground that he was protected by a general exception, would be entitled to get him convicted and that, on the other hand, the production of inconclusive evidence by the defence would mean that he was entitled to an acquittal because the production of that evidence would throw the burden on the other side.”

The judgment rendered in Emperor v. Parbhoo (Supra) was later upheld by a bench of nine judges of Allahabad High Court in Rishi Kesh Singh & Others v. State [8] with minority only giving partial modification to the statement of law laid down in Emperor v. Parbhoo (Supra). These judgments govern the statement of law on “burden of proof” on accused, which provides that the Court has to test if the prosecution discharged its “burden of proof” beyond reasonable doubt, irrespective if a material fact introduced by accused was “proved” or “not proved” the fact on preponderance of probability.

The Protection of Children from Sexual Offences Act, 2012 (hereinafter referred to as “POCSO”) defines offences under Sections 3 (penetrative sexual assault), 5 (aggravated penetrative sexual assault), 7 (sexual assault), 9 (aggravated sexual assault) & 11 (sexual harassment). Further, POCSO provides for presumption to be drawn against an accused, thereby mandating reverse burden of proof on accused, under Sections 29 & 30 of POCSO. These provisions are reiterated herein below:-

Section 29 POCSO

“Presumption as to certain offences. – Where a person is prosecuted for committing or abetting or attempting to commit any offence under sections 3, 5, 7 and section 9 of this Act, the Special Court shall presume, that such person has committed or abetted or attempted to commit the offence, as the case may be unless the contrary is proved.”

Section 30 POCSO

“Presumption of culpable mental state. – (1) In any prosecution for any offence under this Act which requires a culpable mental state on the part of the accused, the Special Court shall presume the existence of such mental state but it shall be a defence for the accused to prove the fact that he has no such mental state with respect to the act charged as an offence in that prosecution.

(2) for the purposes of this section, a fact is said to be proved only when the Special Court believes it to exist beyond reasonable doubt and not merely when its existence is established by a preponderance of probability.

Explanation. – In this section, “culpable mental state” includes intention, motive, knowledge of a fact and the belief in, or reason to believe, a fact.”

A reading of the above-reiterated two provisions reveals that Section 30 of POCSO, additionally, provides for presumption against the mental state of accused and puts further additional “burden of proof” on accused to establish beyond reasonable doubt a fact which dislodges the presumption against mental state of accused.

The above-stated provisions of POCSO are pari materia with Sections 54 & 35 of the Narcotic Drugs and Psychotropic Substances Act, 1985 (hereinafter referred to as “NDPSA”). A challenge was put to validity of provisions of Sections 54 & 35 of NDPSA which was taken to Supreme Court of India in Noor Aga v. State of Punjab [9] in which matter, qua Section 35, it was observed that,

“58. Sections 35 and 54 of the Act, no doubt, raise presumptions with regards to the culpable mental state on the part of the accused as also place the burden of proof in this behalf on the accused; but a bare perusal of the said provision would clearly show that presumption would operate in the trial of the accused only in the event the circumstances contained therein are fully satisfied. An initial burden exists upon the prosecution and only when it stands satisfied, would the legal burden shift. Even then, the standard of proof required for the accused to prove his innocence is not as high as that of the prosecution. Whereas the standard of proof required to prove the guilt of the accused on the prosecution is “beyond all reasonable doubt” but it is “preponderance of probability” on the accused. If the prosecution fails to prove the foundational facts so as to attract the rigors of Section 35 of the Act, the actus reus which is possession of contraband by the accused cannot be said to have been established.”

However, the judgment in Noor Aga (Supra) does not discuss the implication of putting an additional “burden of proof” on accused i.e. to dislodge the presumption against mental state of accused by proving a fact beyond reasonable doubt.

The judgment rendered in Noor Aga (Supra) is sub-silentio of statement of law rendered in Emperor v. Parbhoo (Supra) and Rishi Kesh Singh & Others v. State (Supra). Despite that, the judgment rendered in Noor Aga (Supra) is identified as the basis for rejecting the challenge to Sections 29 & 30 of POCSO as can be observed from the judgments rendered in In re Secretary to the Government of India Ministry of Law and Justice and Ors [10] by the Gauhati High Court and in David v. State of Kerala [11] by the Kerala High Court. The judgment rendered in David (Supra) was, subsequently, discussed by the Kerala High Court in Justin v. Union of India[12] in which it was observed that –

“65. …. The presumptive provision with reserve burden of proof, does not sanction conviction on basis of preponderance of probability. Section 35(2) provides that a fact can be said to have been proved if it is established beyond reasonable doubt and not on preponderance of probability. To hold that, the right of the accused to a fair trial could not be whittled down under the Act, Supreme Court relied on the decision in Noor Aga’s case (supra). In the above case, on facts, Supreme Court found that prosecution failed to establish the foundation facts beyond all reasonable doubt and consequently, the accused was acquitted. …..

…..

67. … In David v. State of Kerala ((2020) 5 KLT 92), learned Single Judge of this Court had occasion to consider the scope of presumption and the duty of the prosecution, to establish the foundational facts. It was held that the standard proof of innocence that is expected from the accused in a case under the POCSO Act was only on the touchstone of preponderance of probability. Section 30 of POCSO clarifies that the culpable state of mind on the part of accused was to be proved by the accused beyond reasonable doubt and not merely on the preponderance of probability, such requirement was absent in section 29 of the POCSO Act …….”

In this view, the dictum of the superior Courts in India qua Section 30(2) of POCSO is also sub-silentio of statement of law rendered in Emperor v. Parbhoo (Supra) and Rishi Kesh Singh & Others v. State (Supra). Therefore, Section 30(2) of POCSO is liable to be challenged to be declared ultra vires as it disables the accused from arguing that prosecution has failed to discharge its “burden of proof” beyond reasonable doubt on basis of fact(s) which is / are introduced by accused but “not proved” beyond reasonable doubt.

****

The author is a post-graduate of Indian Law Institute, New Delhi (2015) & graduate of National Law University, Jodhpur (2012), practicing as an independent legal professional in Delhi. He is also an Advocate-on-Record at the Supreme Court of India.

[1] (1966) 3 SCR 736

[2] (1991) 3 SCC 655

[3] 1995 Supp (2) SCC 187

[4] (2009) 2 SCC 513

[5] ILR 1936 (14) 666

[6] (1935) AC 462

[7] ILR (1941) All 843

[8] AIR 1970 All 51 (FB)

[9] (2008) 16 SCC 417

[10] (2017) 3 Gauhati Law Reports 50

[11] 2020 Cri LJ 3995

[12] W.P. (C) No. 15564 of 2017 before Kerala High Court (Ernakulum Bench) decided on 07.10.2020

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The State Filing Writ Petition Under Article 32: Analysing the Maintainability – By Pawan Reley

February 18, 2021 0Comments 344Views

Recently there was a controversy involving Mukhtar Ansari, the BSP MLA from Uttar Pradesh who is currently lodged in a jail in Punjab. The controversy arose when the State of U.P. filed a Writ Petition against the State of Punjab under Article 32 of the Constitution of India seeking his transfer from Punjab to Uttar Pradesh. It has brought to the fore a few significant substantial questions of law in relation to the interpretation of the Constitution of India:

Whether State (Specifically Government) can be considered as an “aggrieved person” so as to file to Writ Petition under Article 32 of the Constitution of India?
Whether State (Specifically Government) enjoys any “right” or under Indian law and even if it does then whether the same can be enforced by way of filing a Writ Petition under Article 32 of the Constitution of India?

Turning to the first question, it is relevant to note that it is a well settled law that when a person is not an “aggrieved person” (except in cases of Public Interest Litigation), the person is not competent to file Writ Petition challenging the action. However, before we cast a shadow on the question that whether “State” comes under the ambit of “aggrieved person”, it is vital to find out whether State comes under the ambit of “person” per se. The word “person” is not defined under the Indian Constitution, not even under its definition clause enumerated under Article 366. Though, According to Article 367, the definition provided under General Clauses Act, 1897 can be taken into consideration. Section 3 (42) of the General Clauses Act, 1897 defined person as “person shall include any company or association or body of individuals, whether incorporated or not”.

Further, the Hon’ble Supreme Court in the case of Krishnan & Anr. vs Krishnaveni & Anr, (1997) 4 SC 241, analyzing the revision power of the High Court under Section 397 of CrPC, held that, by implication the State stands excluded from the purview of the word ‘person’ for the purposes of limiting its right to avail the revisional power of the High Court under Section 397 (1) of the code for the reason that the State, being the prosecutor of the offender, is enjoined to conduct prosecution on behalf of the society and to take such remedial steps as it deems proper.

Further, the question that who is an “aggrieved person” who can file writ petition was elaborately dealt in the case of Jasbhai Motibhai Desai Vs Roshan Kumar, (1976) 1 SCC 671 where the Hon’ble Supreme Court observed, which is as follows:

“Whether the applicant is a person whose legal right has been infringed? Has he suffered a legal wrong or injury, in the sense that his interest, recognised by law has been prejudicially and directly affected by the act or omission of the authority, complained of? Is he a person who has suffered a legal grievance, a person “against whom a decision has been pronounced which has wrongfully deprived him of something or wrongfully refused him something, or wrongfully affected his title to something”? Has he a special and substantial grievance of his own beyond some grievance or inconvenience suffered by him in common with the rest of the public? Was he entitled to object and be heard by the authority before it took the impugned action? If so, was he prejudicially affected in the exercise of that right by the act of usurpation of jurisdiction on the part of the authority? Is the statute, in the context of which the scope of-the words “person aggrieved” is being considered. a social welfare measure designed to lay down ethical or professional standards of conduct for the community? Or is it a statute dealing with private rights of particular individuals?”

The said case also nowhere stated that “State” can come under the ambit of “aggrieved person”. It is submitted that the Hon’ble Supreme Court hardly had any occasion to scrutinize the relevant judicial pronouncement on that score. Further, no judicial pronouncement of the High Court in this regard too has been traced by me. Though there are cases decided by the Hon’ble Supreme Court of India where the writ was filed by the State Government before Hon’ble High Court and Supreme Court against independent public body such as Election Commission and Hon’ble High Court decided the controversy involved. Matter was taken by Hon’ble Supreme Court though there was no adjudication of the present issues raised [Reference: Election Commission Vs State of Haryana, 1984 (Supp.) SCC 104 (Para. 4); State of M.P. Vs Babulal, (1977) 2 SCC 435; State of Orissa Vs UOI, 1995 (Supp-2) SCC 154]. Thus, the said cases cannot be taken as precedent for present purpose.

I, being the student of Constitution Law, understand that limiting the scope of “aggrieved person” under Article 32 or Article 226 is an orthodox view but it still continues to be a general rule. I learnt that exceptions on specific grounds have been admitted in some cases but those were “exceptions”.

Turning to the second question, it is relevant to note that the remedy provided under Article 32 can be exhausted only for the enforcement of fundamental rights. Thus, the existence of a fundamental right and the infringement thereof, are the foundation of the exercise of the jurisdiction under Article 32.

Article 32 of the Constitution of India is meant to ensure observance of the rule of law and prevent abuse or misuse of power. It is designed to ensure that each and every authority in the State, including the Government, acts bona-fide and within the limits of its powers and that when a court is satisfied that there is an abuse or misuse of power, it is incumbent on the court to afford justice to the individual (S. Pratap Singh Vs. State of Punjab, AIR 1964 SC 72). The fundamental right to move the Hon’ble Supreme Court can be appropriately described as the cornerstone of the democratic edifice raised by the Constitution. The Hon’ble Supreme Court in the case of Prem Chand Garg vs. Excise Commissioner, U.P., AIR 1963 SC 996 held that in discharging duties assigned to the court, the Supreme Court has to play the role of a ‘sentinel on the qui vive’ and it must always regard it as it’s solemn duty to protect the said fundamental rights ‘zealously and vigilantly’.

It must be remembered that the right to move the Supreme Court guaranteed under Clause (1) of Article 32 is subject to conditions of “appropriate proceedings”. Article 32 (1) provides: “The right to move the Supreme Court by “appropriate proceedings” for the enforcement of the rights conferred by this part is guaranteed. There is no freedom to move the Supreme Court by all sorts of proceedings, but only by way of “appropriate proceedings”. What does “appropriate proceedings” mean? This has reference to Clause (2) of Article 32. Only those proceedings are appropriate which invoke, by the original petition the jurisdiction of the Supreme Court to issue, according to the nature of the case, writs or orders or directions of the types described in clause (2) of Article 32. It was held in the case of Bandhua Mukti Morcha vs. Union of India, (1984) 3SCC 161 that the expression ‘appropriate proceedings’ has reference to the proceedings which may be appropriate having regard to the nature of the order, direction or which the petitioner seeks to obtain from the court. The appropriateness of the proceedings would depend upon the particular writ or order which he claims, and it is in the sense that the right has been conferred on the citizen to move the Supreme Court by appropriate proceedings. The Supreme Court further clarifies that there is ‘no limitation’ in regard to the kind of proceedings, envisaged in clause (1) of the Article except that the proceedings must be appropriate, and the requirement of appropriateness must be judged in the light of the purpose for which the proceedings is to be undertaken, namely, enforcement of fundamental right. The word ‘appropriate’ does not refer to any form, but to the purpose of the proceedings and therefore so long as the purpose of the proceedings is enforcement of fundamental rights, it is appropriate and when it relates to the enforcement of the fundamental rights of the poor, disabled or ignorant by a public-spirited person, even a letter addressed by him (to the court) can legitimately be regarded as an “appropriate proceeding”.

According to the Indian Constitutional framework and basic jurisprudence laid behind this, it is evident that ‘State’ (Government in present case) does not enjoy any ‘right’ except as given under Article 131 of the Constitution of India. It enjoys ‘power’. It, in the exercise of its power, protects the rights and liberties of the people. Since it does not enjoy any ‘right’ except as mentioned under Article 131, thus, the question of violation of its right does not arise.

However, sometimes it is possible that the legal rights of a State (a legal entity under Article 300) would be affected by another legal entity. So far as another State of Union of India is concerned, the remedy, in such cases, is exclusively laid down in Article 131 by the suit before Supreme Court. Thus, the recourse of Article 131 can be taken when its right is violated by another State instrumentality [Reference: State of Rajasthan Vs UOI, AIR 1977 SC 1361 (Paras. 106, 114, 117, 133, 157, 165, 188, 192); State of Karnataka Vs UOI, AIR 1978 SC 68 (Paras. 141,149, 195, 203).

However, there are a few instances where the Hon’ble Supreme Court entertained a writ petition under Article 32 where no question of infringement of a fundamental right was involved. The Supreme Court in the case of Aruna Shanbaug vs UOI, AIR 2011 SC 1290 entertained a writ petition under Article 32 on the ground that the case involved issue of law. The Supreme Court in the case of D.C. Wadhwa vs State of Bihar, AIR 1987 SC 579 entertained the writ petition under Article 32 on the ground it involved the question of law relating to interpretation of the Constitution of India. Recently the Hon’ble Supreme Court in its judgement dated 13.11.2019 in the case of Shrimanth Balasaheb Patil Vs. Hon’ble Speaker, Karnataka Legislative Assembly And Others, WP 992 of 2019 entertained the Writ Petition filed by 14 MLAs of Karnataka against the decision of the Karnataka Legislative Assembly even where there was no violation of fundamental rights.

However, the said instances are confined to the petition filed by the individuals or persons and not by the State itself. The jurisprudence behind Article 32 and Article 226 has always been “Writ petition by the people against State” and not “Writ Petition by the State against the People or against another State”. It was an act of great wisdom and foresight on the part of the Constitutional makers to introduce the writ system in India under Article 32 and Article 226 and thus, constitutes the Supreme Court and High Courts into guardians of the people’s legal rights and not that of the “State’s”. Thus, it will be interesting to see in the coming time if the Hon’ble Supreme Court lays down the law in relation to the writ petition filed by the State against other State government.

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Pawan Reley is an advocate practicing at the Supreme Court of India.

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M&A and Investments 2021: Pragmatism will find favour with Lawmakers and Dealmakers – By Siddharth Mody

February 9, 2021 0Comments 202Views

If fortune favours the bold, the deal makers of 2020 may just know who to thank for all the business: the bold. The markets last year barely mirrored the other challenges of the year. Our personal experience with deal processes across sectors: lockdowns yes, slowdowns, not really.

Regulatory liberalisation, pragmatic deal parties and decisive negotiators have parts in the momentum. Private equity dry powder and opportunistic movement aside, it was the sheer will to bring investment that inched deals toward a close.

As lawyers there are lessons in it for us. Being at the forefront of M&A and greenfield investments, taking our seats across negotiation tables, we are somewhere responsible for generating economic activity.

Will we ditch some of our traditional process-allegiances in favour of “getting the deal done”? It is our call to take how bold we can be when it comes to choosing what is best for our client.

But all other significant actors seem to be getting on with the program. Take for instance the Reserve Bank of India (RBI), the Department for Promotion of Industry and Internal Trade (DIPPT), the Foreign Investment Promotion Board (FIPB) and then the investors and promoters themselves.

Regulatory Liberalisation

Foreign Direct Investment (FDI) inflows for the preceding fiscal were affirmative of growing foreign investor confidence in India. The government has moved in line with the goal of keeping this confidence on a high and supporting the ease of doing business.

Foreign investment in India is currently governed by the Foreign Exchange Management (Non-debt instruments) Rules, 2019 and the consolidated FDI Policy 2020. These regulations have undergone several relaxations over the years.

If we focus just on payment structures, there is an oft-prevailing market practice in cross-border transactions where investors withhold payment for indemnity. In India, this practice suffered under the old rules where a foreign investor had to pay the purchase consideration upfront to the Indian counterparty, and also seek RBI approval for escrow arrangements.

The RBI relaxed the rules to (1) allow deferred payment of purchase consideration, and (2) to settle payment through an escrow arrangement and/or to adjust it towards any indemnity claim. Investors can defer 25 per cent of the consideration for 18 months from the date of signing the transfer agreement. Deferring the payment of consideration also helps the non-resident investor in structuring their payment in cross border transactions. Earlier, this structuring was subject to RBI approval.

While implementing such structures, it is imperative to comply with the pricing norms: the total consideration finally paid by a foreign investor/buyer must comply with the pricing guidelines.

Another welcome step by the regulator was to allow warrants and partly paid shares (PPS) as eligible capital instruments for FDI purposes. For sectors in which the government allows FDI under the automatic route, Indian companies can issue warrants and PPS to non-residents subject to certain conditions.

Yet another initiative on the DIPPT’s part was the Start-up India Scheme. Should a start-up be eligible to register under the scheme, it opens doors to benefits such as tax holidays, simplified compliances via self-certification, their investors exempt from capital gains tax, easy exits and winding up for start-ups, and other shots in the arm.

The Ministry of Corporate Affairs also stepped in vide the Companies (Share Capital and Debentures) Third Amendment Rules 2016 to provide for issuing ESOPs to start-up promoters.

With this amendment, the promoters of start-ups are not only able to maintain respectable shareholding in the company, but they also continue to have skin in the game which acts as a driving force for them to work harder.

Regulatory Potential

The relaxations are a welcome step, albeit, in my opinion, with some potential for finetuning. The period of deferral of payment by foreign investors is not currently achieving the greatest possible ease of business. The period of 18 months starts from the date of transfer agreement. In my view, the clock should start from when the sale transaction concludes. This will provide the non-resident investor ideal time, whereas currently it may reduce in a large way.

The lag between the execution date and the closing date varies case to case, depending on the nature of conditions precedent. In my experience, however, there is usually a large lag.

An area where regulatory perception may have been disadvantaged by defensiveness, where mindful analysis was called for was the Press Note 3.

Amidst border conflicts with the neighbouring countries, the DPIIT introduced press note 3 of 2020 (PN 3). The intent was to be “curbing opportunistic takeovers/acquisitions of Indian companies due to the current COVID-19 pandemic”. PN 3 mandates that any investment from an entity of a country which shares a land border with India or where the beneficial owner of an investment into India is situated in or is a citizen of any such country, requires prior government approval.

PN 3 has posed lot of challenges for the private equity and venture capital world. There’s lack of clarity on what amounts to beneficial ownership. The multitude of its interpretations floating in the market are only causing applications by foreign investors to fall into a blackhole. clarity and guidance is required on the definition of beneficial ownership.

Dealmakers Evolve

Macro-economic factors apart, in my experience deal parties have also entered a new season in their stances. Their approach to several aspects of the transaction documents is far too pragmatic in contrast to what we have witnessed in the past.

Promoters have started recognising basic protections that find favour with the investors. Whereas investors may not be very flexible given their obligations under their fund documents.

In their turn, investors now recognise the importance of incentivising promoters. They see the importance of creating an environment conducive for the promoters, to achieve the desired deal outcome. Issuance of ESOPs has its place as the best incentive to employees. Unfortunately, the Companies Act did not permit this incentive for the promoters. The way around this hurdle was to structure such incentives into each transaction, until the MCA amendment we mentioned above that allowed ESOPs to start-up promoters.

The writing on the wall is clear. All stakeholders are leaning towards easing instead of dragging investment negotiations. And lawyers may do well to join in. For instance, deal parties increasingly honouring mutual trust and cooperation based investment terms, in response to certain common asks from the other side.

Lawyers are bound by the mandate to accomplish the best for their client. However, in doing so, pragmatism is often lost, and negotiations are unnecessarily dragged thereby affecting the overall deal timelines. I think it is important for a lawyer to also advise their client on what is market practice and whether the ask is reasonable or unreasonable.

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Siddharth Mody is a Partner, in Mumbai, in the corporate practice of a leading Indian law firm.

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This article has been published in partnership with Forbes India and first appeared forbesindia.com:

https://www.forbesindia.com/article/legalpowerlist2020/ma-and-investments-2021-siddharth-mody/66229/1

Columns

CCI’s Telecom Market Study: Understanding Markets Better for Better Regulation By Rudresh Singh and Aaditya Ranbir Sahgal

February 6, 2021 0Comments 319Views

The Competition Commission of India (CCI) recently released a market study on the telecom sector in India discussing the evolution of the competitive structure in the market over time. Such a market study comes soon after the announcement of market studies and reviews to be undertaken in certain key sectors and markets important for the development of the economy as well as society, such as pharmaceuticals, key infrastructure sectors such as airports, railways, ports, and electricity, as well as private equity investments. While such market studies and reviews are underway, the CCI has previously released policy notes and market studies in important sectors such as healthcare and e-commerce, amongst others.

Considering such market studies are formulated pursuant to consultations with key stakeholders such as market participants, consumer groups, and research institutes, amongst others, a market study helps the CCI to understand the commercial practicalities of markets, weigh the same against the objectives and provisions of the Competition Act, 2002, and arrive at optimal positions that account for commercial interest, consumer interest as well as give fillip to competition in markets. Such initiatives by the CCI, a sector agnostic regulator, signals the regulator becoming a mature regulator which seeks to understand the markets it regulates as opposed to regulating markets it has no understanding of, where regulatory actions act as hindrance to commerce. Such efforts of the CCI to shift towards becoming a more business friendly regulator, intervening appropriately only in instances where intervention is actually merited, are laudable.

Market studies don’t just help the regulator understand the market better, they also help key stakeholders understand the thought process of the regulator and help such stakeholders to assist the CCI. In such light, the move of the CCI to undertake and release a market study on the telecom sector, which has seen substantial churn over the years, is of significant importance. The events following the declaration of lockdowns as part of governmental efforts to combat COVID19 highlighted more than ever that a well-functioning telecom sector, which offers quality of service, is of key importance to sustain commerce and economic activity while also ensuring that social interactions do not cease altogether when combating an anomaly of the nature of COVID19. Very importantly, advancements in technology in the telecom sector helped ensure that the administration of justice does not cease, as courts across India rapidly moved to an online functioning process. The aforesaid does not begin to account for the possibilities that 5G technology has to offer, and would not have been possible without the technological advancements till date.

Therefore, the question arises, how does the competition regulator assess such an important sector which has seen many competitors exit the market over-time? The CCI took note of several key metrics on the basis of which many of its observations are premised. It was noted that while the consumer base, Minutes of Use and data usage by consumers had increased vastly over time, the average revenue per user had decreased by a factor of almost 18, and net profit margins have been seen to have fallen to as low as 0.5%. The same is a very unique phenomenon since the number of telecom operators has reduced substantially over the years, however, profit margins have not gone up even in the face of increased usage of the offerings of such a reduced number of service providers.

In light of such market dynamics, the CCI noted that the disruptive market entry of Reliance Jio had led to the incumbents approaching the Telecom Regulatory Authority of India (TRAI) to institute a floor price i.e. a minimum price below which no operator could provide its services. In such regard, the CCI had, at that juncture, advised TRAI to refrain from such a move as the same also runs the possible risk of complacence on the part of telecom operators who are not incentivized to compete in light of ensured profitability. Subsequently, by way of the present market study, the CCI is attempting to adopt a nuanced view of the circumstances. One very important aspect of the market study related to the aspect of price competition and non-price competition in the telecom sector, as it existed previously, and such competition in the present and near future.

It was noted that there is significant parity in prices across operators, therefore, non-price factors of competition assume significant importance. While it was acknowledged that the average consumer remains price sensitive, the CCI was of the view that other factors such as quality of service, data speeds and the phenomenon of bundling of services of different natures and offering premium services to consumers will significantly influence consumer choice in terms of choice of operator. Bundled offerings, specifically, were noted to be the factor that will drive differentiation in the market. Such bundled offerings can be seen in various forms across operators, such as tie-ups with Over-The-Top (OTT) media platforms, amongst others, in order to offer exclusive benefits and content which is offered at zero cost to users. Not only do such bundled offerings help consumers gain an expanded and better quality of service, it also provides an opportunity for telecom operators to devise unique monetization schemes to help increase profitability.

However, in the background of such evolution of services offered, the role of the CCI and prudence on its part becomes of utmost importance. During the evolution of services in such a manner, there are various parties that interact in respect of delivery to the end consumer. These include not just the telecom service provider but also OTT media platforms which telecom operators may tie up with, content delivery networks that provide geographically distributed servers in order to assist with efficient delivery of content, payment gateways that facilitate transactions undertaken by the consumer, and any other entity that may be involved in providing a service which is a part of the bundle offered to the consumers. It would be of utmost importance to ensure that no entity at any of the vertical levels operates in an abusive manner that prejudices competition in the market place and results in harm to other market players in an undue manner.

To appreciate such concerns of anti-competitive conduct, at the level of telecom operators, it needs to be noted that the Herfindahl-Hirschman Index – a tool used to measure market concentration and determine competitiveness in a market, has continued to increase over time and is now at a level that suggests a high degree of concentration, and resultantly, potential market power in the hands of the telecom operators. At downstream levels, vertical integration can be seen in the form of telecom operators investing in content creation companies (for instance, Reliance Jio’s acquisition of shareholding in Balaji Telefilms which, in turn, owns an OTT platform), launch of media platforms which integrate a wide variety of entertainment content, news content, music content, etc. (for instance, Airtel Xstream, JioTV, JioNews, amongst others).

However, such vertical integration and consolidation require appropriate structuring and approaches such that the CCI does not have apprehensions of anti-competitive conduct while also ensuring that the commercial objectives of the transacting parties are not unduly diminished or diluted. It needs to be noted that vertical integration and consolidation, by themselves, need not lead to appreciable adverse effects on competition, the threshold set out by the Competition Act, 2002 to determine the permissibility of any conduct. The CCI, as a mature regulator trying to ensure competition in markets while also not impeding ease of doing business, ought to keep the aforesaid in mind while assessing the competitive effects of such evolving market practices considering it observed in the present study that there is a possibility of anti-competitive conduct from such integration which requires deeper scrutiny.

For instance, the CCI took note of reports claiming that certain broadband services providers routed data traffic in such a manner that faster speeds were provided to specific services. The employment of such practices by telecom service providers, if the same are alleged to be employed, would require scrutiny to assess whether the same have resulted in contraventions of the rules of competition such as the prohibition on abuse of dominance as contained in Section 4 of the Competition Act, 2002. However, the CCI would be well advised to take action only when egregious distortions of the competitive structure and violations of rules of competition are observed considering the rapidly changing market structure accompanied by the financial turmoil seen in the telecom markets owing to various factors.

Further, considering the uncharted territories, the CCI and TRAI would have to work in harmony with each other as relevant regulators for the telecom sector, and in accordance with the provisions of the Competition Act, 2002 and TRAI Act, 1997 and the decision of the Supreme Court regarding the jurisdictional conflict which arose between the two regulators previously.

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Rudresh Singh is Partner, L&L Partners

Aaditya Ranbir Sahgal is Associate, L&L Partners

Columns

Litigation Finance in India: An Overview – By Prateek Bagaria

January 28, 2021 0Comments 302Views

The general reaction to litigation finance in India has been in the ‘doubtful’ domain on account of the dearth of news, data or propagators of the same. Moreover, it has met with an opinion, without basis, of being illegal or against public policy.

However, this is not true. Litigation finance has always found place and acceptance in India. The common law torts and crimes of maintenance and champerty were never in force as special laws in India. Consequently, a fair agreement to supply funds to carry on a suit in consideration for a share in the litigation proceeds has never been considered void, or against public policy in India. This was confirmed by jurisprudence spanning over centuries, from 1876 to 2018.

On the other hand, if an Indian court finds that a funding agreement is extortionate, unconscionable or inequitable, it may refuse to give effect to it under section 23 of the Contract Act, 1872, on the ground that it is against public policy. This raised the question as to what makes a Litigation Finance Agreement (LFA) unfair, extortionate, unconscionable or inequitable.

The answer is subjective and varies from case-to-case. However, some common principles that emerge from jurisprudence are that the funding agreement will be invalidated and/or held unenforceable if an agreement is shown to have been entered into for an improper object or to encourage litigation (which on the face of it) is unrighteous; or where a lawyer funded its client’s dispute; or where the funder had influence over the judge; or where the funder misled the claimant about the expected expenses or failed to prove that it had incurred any expenses

The courts have also considered other principles with respect to the LFA. For instance, an uplift in the total return due to the funder, depending on the length of the litigation and the funder’s participation has been accepted; and the waterfall clause under a non-recourse funding agreement has been accepted as an equitable assignment of the litigation proceeds to the funder.

The courts have also recognised the ability of (i) the defendant to claim costs against the funder in the main proceedings. However, Courts have held that even in cases where the funder has supreme control and manages the entire litigation, the defendant has no privity to initiate a separate claim (outside the funded claim) to recover unrecovered costs from the funder; (ii) the funder to make allowance to the litigant for their support during the pendency of the litigation; and to have an option in the LFA to choose between a portion of the litigation proceeds or an uplift on the funded costs, after the outcome of the litigation.

Further, as the returns of the financier are also relevant in judging the fairness of a financing agreement; in assessing fairness of returns, courts consider the ‘commercial value’ of the claim. While there is no legal definition of the ‘commercial value’, the courts have explained that the commercial value of the claim can be estimated by the parties in advance of the result by weighing probabilities which includes assessing which of the claims of the litigant are “highly probable to succeed” and which have a “little chance of success”. The courts have also found such assessment as reasonable and confirmed the parties’ shrewd estimate of the chances of succeeding in the litigation.

Furthermore, while it is lawful for a plaintiff to assign the benefit which he may obtain under the decree on to the funder, courts have clarified that there cannot be an assignment of the claim itself. This is because a “mere right to sue” or a “right of action for recovering damages” is not assignable under Indian law. All that the deed of assignment can confer upon the assignee is the right to the fruits of the litigation. However, this aforesaid limitation to assignment is not applicable when the subject matter of assignment is debt or receivables. In those cases, a financer has the ability to seek the transfer of the debt or receivable either by securitisation or factoring. This includes transfer of the incidental right to make claims to recover the debt or receivables.

Significantly, the courts have also confirmed that there is no difference in this position if the litigation proceeds come into existence by the virtue of a decree or a compromise, or if the litigation proceeds obtained from a compromise comprised of moveable or immovables other than the suit property. The courts have also recognised the funder’s interest in the litigation proceeds as a contingent interest, subject to the litigation, for supply of funds required to carry out the litigation.

Indian law additionally recognises the ability of the financier to control and manage the litigation by (a) requiring the funder’s consent before settling the case; or (b) the financier looking after the litigation by engaging lawyers, securing the records, paying the lawyers, and everything that a litigant would do otherwise; or (c) the financier managing the litigation under an irrevocable power of attorney and having “supreme control” or “virtual control” of the proceedings, including the power to receive the litigation proceeds and distributing to the litigant his share; and the litigant only occasionally seeing the pleaders.

Further, with regards to the consequences of entering into an LFA, amendments by states like Maharashtra, Madras (present day Tamil Nadu), Madhya Pradesh and Odisha to the Civil Procedure Code, 1908 (“CPC”), make express provisions recognising and providing rules in relation to litigation finance.

Despite this rich jurisprudential history of litigation finance in India, this sector has been largely unorganised and undeveloped. However, this is fast changing on account of (a) Improvement of speed and procedure: Beginning in 2015, India has seen rapid reforms to its commercial litigation and arbitration; (b) Growth of international disputes market: With growing liberalisation and commercialisation, India has seen tremendous growth in the international dispute market; (c) Mass action claims developing in India: In recent years, the Indian market has been hit with a number of frauds and scams, especially in the banking sector, that have eroded the investments and deposits of thousands of people. These incidents are potential mass claims waiting to be filed, collectively worth billions of dollars; (d) Conducive insolvency regime: Recent amendments to the Liquidation Process Regulations under the Insolvency and Bankruptcy Code have brought in changes that potentially open further doors to litigation funding in India; (e) Global enforcement and debt recovery: Since India is a party to the New York Convention on enforcement of arbitral awards and has reciprocal enforcement arrangements for court decrees with UK, Singapore, UAE, New Zealand, Malaysia and Hong Kong, Indian awards and decrees can be enforced globally.

Correspondingly, the Indian market has been a busy participant in the growing international litigation finance industry. Recognising the ripe conditions in the Indian market as well as the support for it in Indian law, global players have come together to form the Indian Association for Litigation Finance (IALF), an association with a vision and mission to create self-regulations for, and promote knowledge-development of litigation finance in India.

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Prateek Bagaria is a partner at Singularity Legal and is an international disputes specialist with a decade of experience in complex commercial cross-border disputes. He spearheaded the foundation of the IALF and possesses the domain expertise in advising funders and litigants seeking litigation finance.

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This article has been published in partnership with Forbes India and first appeared forbesindia.com.

https://www.forbesindia.com/article/legalpowerlist2020/litigation-finance-in-india-an-overview-by-prateek-bagaria/65967/1

Interviews

Interviews, Trending

Time for judiciary to introspect and see what can be done to restore people’s faith – Justice Lokur

February 3, 2020 0Comments 997Views

Justice Madan B Lokur, was a Supreme Court judge from June 2012 to December 2018. He is now a judge of the non-resident panel of the Supreme Court of Fiji. He spoke to LegitQuest on January 25, 2020.

Q: You were a Supreme Court judge for more than 6 years. Do SC judges have their own ups and downs, in the sense that do you have any frustrations about cases, things not working out, the kind of issues that come to you?

A: There are no ups and downs in that sense but sometimes you do get a little upset at the pace of justice delivery. I felt that there were occasions when justice could have been delivered much faster, a case could have been decided much faster than it actually was. (When there is) resistance in that regard normally from the state, from the establishment, then you kind of feel what’s happening, what can I do about it.

Q: So you have had the feeling that the establishment is trying to interfere in the matters?

A: No, not interfering in matters but not giving the necessary importance to some cases. So if something has to be done in four weeks, for example if reply has to be filed within four weeks and they don’t file it in four weeks just because they feel that it doesn’t matter, and it’s ok if we file it within six weeks how does it make a difference. But it does make a difference.

Q: Do you think this attitude is merely a lax attitude or is it an infrastructure related problem?

A: I don’t know. Sometimes on some issues the government or the establishment takes it easy. They don’t realise the urgency. So that’s one. Sometimes there are systemic issues, for example, you may have a case that takes much longer than anticipated and therefore you can’t take up some other case. Then that necessarily has to be adjourned. So these things have to be planned very carefully.

Q: Are there any cases that you have special memories of in terms of your personal experiences while dealing with the case? It might have moved you or it may have made you feel that this case is really important though it may not be considered important by the government or may have escaped the media glare?

A: All the cases that I did with regard to social justice, cases which concern social justice and which concern the environment, I think all of them were important. They gave me some satisfaction, some frustration also, in the sense of time, but I would certainly remember all these cases.

Q: Even though you were at the Supreme Court as a jurist, were there any learning experiences for you that may have surprised you?

A: There were learning experiences, yes. And plenty of them. Every case is a learning experience because you tend to look at the same case with two different perspectives. So every case is a great learning experience. You know how society functions, how the state functions, what is going on in the minds of the people, what is it that has prompted them to come the court. There is a great learning, not only in terms of people and institutions but also in terms of law.

Q: You are a Judge of the Supreme Court of Fiji, though a Non-Resident Judge. How different is it in comparison to being a Judge in India?

A: There are some procedural distinctions. For example, there is a great reliance in Fiji on written submissions and for the oral submissions they give 45 minutes to a side. So the case is over within 1 1/2 hours maximum. That’s not the situation here in India. The number of cases in Fiji are very few. Yes, it’s a small country, with a small number of cases. Cases are very few so it’s only when they have an adequate number of cases that they will have a session and as far as I am aware they do not have more than two or three sessions in a year and the session lasts for maybe about three weeks. So it’s not that the court sits every day or that I have to shift to Fiji. When it is necessary and there are a good number of cases then they will have a session, unlike here. It is then that I am required to go to Fiji for three weeks. The other difference is that in every case that comes to the (Fiji) Supreme Court, even if special leave is not granted, you have to give a detailed judgement which is not the practice here.

Q: There is a lot of backlog in the lower courts in India which creates a problem for the justice delivery system. One reason is definitely shortage of judges. What are the other reasons as to why there is so much backlog of cases in the trial courts?

A: I think case management is absolutely necessary and unless we introduce case management and alternative methods of dispute resolution, we will not be able to solve the problem. I will give you a very recent example about the Muzaffarpur children’s home case (in Bihar) where about 34 girls were systematically raped. There were about 17 or 18 accused persons but the entire trial finished within six months. Now that was only because of the management and the efforts of the trial judge and I think that needs to be studied how he could do it. If he could do such a complex case with so many eyewitnesses and so many accused persons in a short frame of time, I don’t see why other cases cannot be decided within a specified time frame. That’s case management. The second thing is so far as other methods of disposal of cases are concerned, we have had a very good experience in trial courts in Delhi where more than one lakh cases have been disposed of through mediation. So, mediation must be encouraged at the trial level because if you can dispose so many cases you can reduce the workload. For criminal cases, you have Plea Bargaining that has been introduced in 2009 but not put into practice. We did make an attempt in the Tis Hazari Courts. It worked to some extent but after that it fell into disuse. So, plea bargaining can take care of a lot of cases. And there will be certain categories of cases which we need to look at carefully. For example, you have cases of compoundable offences, you have cases where fine is the punishment and not necessarily imprisonment, or maybe it’s imprisonment say one month or two month’s imprisonment. Do we need to actually go through a regular trial for these kind of cases? Can they not be resolved or adjudicated through Plea Bargaining? This will help the system, it will help in Prison Reforms, (prevent) overcrowding in prisons. So there are a lot of avenues available for reducing the backlog. But I think an effort has to be made to resolve all that.

Q: Do you think there are any systemic flaws in the country’s justice system, or the way trial courts work?

A: I don’t think there are any major systemic flaws. It’s just that case management has not been given importance. If case management is given importance, then whatever systematic flaws are existing, they will certainly come down.

Q; And what about technology. Do you think technology can play a role in improving the functioning of the justice delivery system?

I think technology is very important. You are aware of the e-courts project. Now I have been told by many judges and many judicial academies that the e-courts project has brought about sort of a revolution in the trial courts. There is a lot of information that is available for the litigants, judges, lawyers and researchers and if it is put to optimum use or even semi optimum use, it can make a huge difference. Today there are many judges who are using technology and particularly the benefits of the e-courts project is an adjunct to their work. Some studies on how technology can be used or the e-courts project can be used to improve the system will make a huge difference.

Q: What kind of technology would you recommend that courts should have?

A: The work that was assigned to the e-committee I think has been taken care of, if not fully, then largely to the maximum possible extent. Now having done the work you have to try and take advantage of the work that’s been done, find out all the flaws and see how you can rectify it or remove those flaws. For example, we came across a case where 94 adjournments were given in a criminal case. Now why were 94 adjournments given? Somebody needs to study that, so that information is available. And unless you process that information, things will just continue, you will just be collecting information. So as far as I am concerned, the task of collecting information is over. We now need to improve information collection and process available information and that is something I think should be done.

Q: There is a debate going on about the rights of death row convicts. CJI Justice Bobde recently objected to death row convicts filing lot of petitions, making use of every legal remedy available to them. He said the rights of the victim should be given more importance over the rights of the accused. But a lot of legal experts have said that these remedies are available to correct the anomalies, if any, in the justice delivery. Even the Centre has urged the court to adopt a more victim-centric approach. What is your opinion on that?

You see so far as procedures are concerned, when a person knows that s/he is going to die in a few days or a few months, s/he will do everything possible to live. Now you can’t tell a person who has got terminal cancer that there is no point in undergoing chemotherapy because you are going to die anyway. A person is going to fight for her/his life to the maximum extent. So if a person is on death row s/he will do everything possible to survive. You have very exceptional people like Bhagat Singh who are ready to face (the gallows) but that’s why they are exceptional. So an ordinary person will do everything possible (to survive). So if the law permits them to do all this, they will do it.

Q: Do you think law should permit this to death row convicts?

A: That is for the Parliament to decide. The law is there, the Constitution is there. Now if the Parliament chooses not to enact a law which takes into consideration the rights of the victims and the people who are on death row, what can anyone do? You can’t tell a person on death row that listen, if you don’t file a review petition within one week, I will hang you. If you do not file a curative petition within three days, then I will hang you. You also have to look at the frame of mind of a person facing death. Victims certainly, but also the convict.

Q: From the point of jurisprudence, do you think death row convicts’ rights are essential? Or can their rights be done away with?

A: I don’t know you can take away the right of a person fighting for his life but you have to strike a balance somewhere. To say that you must file a review or curative or mercy petition in one week, it’s very difficult. You tell somebody else who is not on a death row that you can file a review petition within 30 days but a person who is on death row you tell him that I will give you only one week, it doesn’t make any sense to me. In fact it should probably be the other way round.

Q: What about capital punishment as a means of punishment itself?

A: There has been a lot of debate and discussion about capital punishment but I think that world over it has now been accepted, more or less, that death penalty has not served the purpose for which it was intended. So, there are very few countries that are executing people. The United States, Saudi Arabia, China, Pakistan also, but it hasn’t brought down the crime rate. And India has been very conservative in imposing the death penalty. I think the last 3-4 executions have happened for the persons who were terrorists. And apart from that there was one from Calcutta who was hanged for rape and murder. But the fact that he was hanged for rape and murder has not deterred people (from committing rape and murder). So the accepted view is that death penalty has not served the purpose. We certainly need to rethink the continuance of capital punishment. On the other hand, if capital punishment is abolished, there might be fake encounter killings or extra judicial killings.

Q: These days there is the psyche among people of ‘instant justice’, like we saw in the case of the Hyderabad vet who was raped and murdered. The four accused in the case were killed in an encounter and the public at large and even politicians hailed it as justice being delivery. Do you think this ‘lynch mob mentality’ reflects people’s lack of faith in the justice system?

A: I think in this particular case about what happened in Telangana, investigation was still going on. About what actually happened there, an enquiry is going on. So no definite conclusions have come out. According to the police these people tried to snatch weapons so they had to be shot. Now it is very difficult to believe, as far as I am concerned, that 10 armed policeman could not overpower four unarmed accused persons. This is very difficult to believe. And assuming one of them happened to have snatched a (cop’s) weapon, maybe he could have been incapacitated but why the other three? So there are a lot of questions that are unanswered. So far as the celebrations are concerned, the people who are celebrating, do they know for certain that they (those killed in the encounter) were the ones who did the crime? How can they be so sure about it? They were not eye witnesses. Even witnesses sometimes make mistakes. This is really not a cause for celebration. Certainly not.

Q: It seems some people are losing their faith in the country’s justice delivery system. How to repose people’s faith in the legal process?

A: You see we again come back to case management and speedy justice. Suppose the Nirbhaya case would have been decided within two or three years, would this (Telangana) incident have happened? One can’t say. The attack on Parliament case was decided in two or three years but that has not wiped out terrorism. There are a lot of factors that go into all this, so there is a need to find ways of improving justice delivery so that you don’t have any extremes – where a case takes 10 years or another extreme where there is instant justice. There has to be something in between, some balance has to be drawn. Now you have that case where Phoolan Devi was gangraped followed by the Behmai massacre. Now this is a case of 1981, it has been 40 years and the trial court has still not delivered a judgement. It’s due any day now, (but) whose fault is that. You have another case in Maharashtra that has been transferred to National Investigating Agency two years after the incident, the Bhima-Koregaon case. Investigation is supposedly not complete after two years also. Whose fault is that? So you have to look at the entire system in a holistic manner. There are many players – the investigation agency is one player, the prosecution is one player, the defence is one player, the justice delivery system is one player. So unless all of them are in a position to coordinate… you cannot blame only the justice delivery system. If the Telangana police was so sure that the persons they have caught are guilty, why did they not file the charge sheet immediately? If they were so sure the charge sheet should have been filed within one day. Why didn’t they do it?

Q: At the trial level, there are many instances of flaws in evidence collection. Do you think the police or whoever the investigators are, do they lack training?

A: Yes they do! The police lacks training. I think there is a recent report that has come out last week which says very few people (in the police) have been trained (to collect evidence).

Q: You think giving proper training to police to prepare a case will make a difference?

A: Yes, it will make a difference.

Q: You have a keen interest in juvenile justice. Unfortunately, a lot of heinous crimes are committed by juveniles. How can we correct that?

A: You see it depends upon what perspective we are looking at. Now these heinous crimes are committed by juveniles. Heinous crimes are committed by adults also, so why pick upon juveniles alone and say something should be done because juveniles are committing heinous crimes. Why is it that people are not saying that something should be done when adults are committing heinous crimes? That’s one perspective. There are a lot of heinous crimes that are committed against juveniles. The number of crimes committed against juveniles or children are much more than the crimes committed by juveniles. How come nobody is talking about that? And the people committing heinous crimes against children are adults. So is it okay to say that the State has imposed death penalty for an offence against the child? So that’s good enough, nothing more needs to be done? I don’t think that’s a valid answer. The establishment must keep in mind the fact that the number of heinous crimes against children are much more than those committed by juveniles. We must shift focus.

Q: Coming to NRC and CAA. Protests have been happening since December last year, the SC is waiting for the Centre’s reply, the Delhi HC has refused to directly intervene. Neither the protesters nor the government is budging. How do we achieve a breakthrough?

A: It is for the government to decide what they want to do. If the government says it is not going to budge, and the people say they are not going to budge, the stalemate could continue forever.

Q: Do you think the CAA and the NRC will have an impact on civil liberties, personal liberties and people’s rights?

A: Yes, and that is one of the reasons why there is protest all over the country. And people have realised that it is going to happen, it is going to have an impact on their lives, on their rights and that’s why they are protesting. So the answer to your question is yes.

Q: Across the world and in India, we are seeing an erosion of the value system upholding rights and liberties. How important is it for the healthy functioning of a country that social justice, people’s liberties, people’s rights are maintained?

A: I think social justice issues, fundamental rights are of prime importance in our country, in any democracy, and the preamble to our Constitution makes it absolutely clear and the judgement of the Supreme Court in Kesavananda Bharati and many other subsequent judgments also make it clear that you cannot change the basic structure of the Constitution. If you cannot do that then obviously you cannot take away some basic democratic rights like freedom of assembly, freedom of movement, you cannot take them away. So if you have to live in a democracy, we have to accept the fact that these rights cannot be taken away. Otherwise there are many countries where there is no democracy. I don’t know whether those people are happy or not happy.

Q: What will happen if in a democracy these rights are controlled by hook or by crook?

A: It depends upon how much they are controlled. If the control is excessive then that is wrong. The Constitution says there must be a reasonable restriction. So reasonable restriction by law is very important.

Q: The way in which the sexual harassment case against Justice Gogoi was handled was pretty controversial. The woman has now been reinstated in the Supreme Court as a staffer. Does this action of the Supreme Court sort of vindicate her?

A: I find this very confusing you know. There is an old joke among lawyers: Lawyer for the petitioner argued before the judge and the judge said you are right; then the lawyer for the respondent argued before the judge and the judge said you’re right; then a third person sitting over there says how can both of them be right and the judge says you’re also right. So this is what has happened in this case. It was found (by the SC committee) that what she said had no substance. And therefore, she was wrong and the accused was right. Now she has been reinstated with back wages and all. I don’t know, I find it very confusing.

Q: Do you think the retirement age of Supreme Court Judges should be raised to 70 years and there should be a fixed tenure?

A: I haven’t thought about it as yet. There are some advantages, there are some disadvantages. (When) You have extended age or life tenure as in the United States, and the Supreme Court has a particular point of view, it will continue for a long time. So in the United States you have liberal judges and conservative judges, so if the number of conservative judges is high then the court will always be conservative. If the number of liberal judges is high, the court will always be liberal. There is this disadvantage but there is also an advantage that if it’s a liberal court and if it is a liberal democracy then it will work for the benefit of the people. But I have not given any serious thought onthis.

Q: Is there any other thing you would like to say?

A: I think the time has come for the judiciary to sit down, introspect and see what can be done, because people have faith in the judiciary. A lot of that faith has been eroded in the last couple of years. So one has to restore that faith and then increase that faith. I think the judiciary definitely needs to introspect.

Important Judgments

Supreme Court stays release of PMC Bank accused on Centre’s plea against Bombay HC order

Webinar on Role of Mediation in Justice Delivery System

Constitution@70: HNLU invites you to a debate on the themes of ‘Judiciary’, ‘Media’ and ‘IPR’ in the backdrop of the Constitution

Reverse Burden of Proof on Accused in Criminal Trials: Is there scope for a challenge to Section 30(2) of the Protection of Children from Sexual Offences Act, 2012? – By Satyam Thareja

The State Filing Writ Petition Under Article 32: Analysing the Maintainability – By Pawan Reley

CCI’s Telecom Market Study: Understanding Markets Better for Better Regulation By Rudresh Singh and Aaditya Ranbir Sahgal

Litigation Finance in India: An Overview – By Prateek Bagaria

Supreme Court Recent Judgment

M.E. SHIVALINGAMURTHY V. CENTRAL BUREAU OF INVESTIGATION, BENGALURU

Dr. Vijayakumaran C.P.V. V. Central University of Kerala & Ors.

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