August 10, 2021
The Limited Liability Partnership (Amendment) Bill, 2021 was introduced in Rajya Sabha on July 30, 2021. The Bill seeks to amend the Limited Liability Partnership Act, 2008. The Act provides for regulation of limited liability partnerships (LLP). LLP is an alternative corporate body form to traditional partnership firms. Under LLP, a partner’s liabilities are limited to their investment in the business. The Bill converts certain offences into civil defaults and changes the nature of punishment for these offences. It also defines small LLP, provides for appointment of certain adjudicating officers, and establishment of special courts. Key features of the Bill include:
Certain offences decriminalised: The Act specifies the manner of operations of LLPs, and provides that violating these requirements will be punishable with a fine (ranging between two thousand rupees and five lakh rupees). These requirements include: (i) changes in partners of the LLP, (ii) change of registered office, (iii) filing of statement of account and solvency, and annual return, and (iv) arrangement between an LLP and its creditors or partners, and reconstruction or amalgamation of an LLP. The Bill decriminalises these provisions and imposes a monetary penalty.
Change of name of LLP: The Act states that the central government may direct an LLP to change its name on certain grounds (such as the name being undesirable or identical to a trademark pending registration). Failing to comply with such direction is punishable with a fine ranging from Rs 10,000 to five lakh rupees. The Bill removes some of these grounds, and empowers the central government to allot a new name to such an LLP instead of levying a fine.
Punishment for fraud: Under the Act, if an LLP or its partners carry out an activity to defraud their creditors, or for any other fraudulent purpose, every person party to it knowingly is punishable with imprisonment of up to two years and a fine between Rs 50,000 and five lakh rupees. The Bill increases the maximum term of imprisonment from two years to five years.
Non-compliance of orders of Tribunal: Under the Act, non-compliance with an order of the National Company Law Tribunal (NCLT) is punishable with imprisonment up to six months and fine up to Rs 50,000. The Bill removes this offence.
Compounding of offences: Under the Act, the central government may compound any offence under the Act which is punishable only with a fine. The amount imposed may be up to the maximum fine prescribed for the offence. The Bill amends this to provide that a regional director (or any officer above his rank), appointed by the central government, may compound such offences. The amount imposed must be within the minimum and maximum fine for the offence. If an offence by an LLP or its partners was compounded, then a similar offence cannot be compounded within a three-year period.
Adjudicating Officers: Under the Bill, the central government may appoint adjudicating officers for awarding penalties under the Act. These will be central government officers not below the rank of Registrar. Appeals against orders of the Adjudicating Officers will lie with the Regional Director.
Special courts: The Bill allows the central government to establish special courts for ensuring speedy trial of offences under the Act. The special court will consist of: (i) a Sessions Judge or an Additional Sessions Judge, for offences punishable with imprisonment of three years or more; and (ii) a Metropolitan Magistrate or a Judicial Magistrate, for other offences. They will be appointed with the concurrence of the Chief Justice of the High Court. Appeals against orders of these special courts will lie with High Courts.
Appeals to Appellate Tribunal: Under the Act, appeals against orders of the NCLT lie with the National Company Law Appellate Tribunal (NCLAT). The Bill adds that appeals cannot be made against an orders that have been passed with the consent of the parties. Appeals must be filed within 60 days (extendable by another 60 days) of the order.
Small LLP: The Bill provides for formation of a small LLP where: (i) the contribution from partners is up to Rs 25 lakh (may be increased up to five crore rupees), (ii) turnover for the preceding financial year is up to Rs 40 lakh (may be increased up to Rs 50 crore). The central government may also notify certain LLPs as start-up LLPs (as recognised through notifications). Standards of accounting: Under the Bill, the central government may prescribe the standards of accounting and auditing for classes of LLPs, in consultation with the National Financial Reporting Authority.
August 20, 2021: Proposing to abolish certain key Tribunals and Authorities and to provide for a mechanism to file Appeal directly to the Commercial Court or the High Court, the Tribunal Reforms Bill was introduced in the Lok Sabha by the Finance Minister, Nirmala Sitharaman, on August 2, 2021. It was passed by the Lok Sabha on August 3, 2021 and by the Rajya Sabha on August 9,2021.
This Bill replaces the Tribunals Reforms (Rationalisation and Conditions of Service) Ordinance, 2021.
The highlight of this Bill is to amend various Central Acts in order to abolish certain Tribunals, namely, Film Certification Appellate Tribunal, Airports Appellate Tribunal, Authority for Advance Rulings, Intellectual Property Appellate Board and the Plant Varieties Protection Appellate Tribunal.
The Appellate Tribunals, under the Cinematograph Act, 1952, Copyright Act, 1957, Customs Act, 1962, Patents Act, 1970, Airports Authority of India Act, 1994, Trade Marks Act, 1999, Geographical Indications of Goods (Registration and Protection) Act, 1999, and Control of National Highways (Land and Traffic) Act, 2002, have been replaced by the Commercial Court or the High Court.
In the Transitional provision, the Bill has clarified that any person appointed as the Chairperson or Chairman or President or Presiding Officer or Vice-Chairperson or Vice-Chairman or Vice-President or Member of the Tribunal, Appellate Tribunal, or, other Authorities specified in the Second Schedule and holding office as such immediately before the notified date, will cease to hold such office on and from the notified date.
Such office holders will be entitled to claim compensation not exceeding three months’ pay and allowances for the premature termination of term of his/her office or of any contract of service.
The Bill has also laid out uniform terms and conditions of service for Chairperson and Members of various tribunals, including the Search-cum-Selection Committee .This Committee, introduced by the Bill, will be giving recommendations to the Central Government regarding the appointment of the Chairperson and the Member of a Tribunal. For State administrative Tribunals, there will be separate Search-cum-Selection Committees.
The Central Government on the recommendation of the Committee, can also remove from office, any Chairperson or a Member. The Bill further adds that the Chairperson of a Tribunal shall hold office for a term of four years or till he attains the age of seventy years, whichever is earlier; and the Member of a Tribunal shall hold office for a term of four years or till he attains the age of sixty-seven years, whichever is earlier.
Provisions have also been made for re-appointment. As far as salary and allowances are concerned, the Central Government has been vested with the power to make rules to provide for the salary of the Chairperson and Member of a Tribunal.
The Central government has also been empowered to make rules to provide for the qualifications, appointment, resignation, removal and other conditions of service of tribunal members.
Regarding the issue of pending cases, the Bill postulates that any appeal, application or proceeding pending before the Tribunal, Appellate Tribunal or other Authorities, other than those pending before the Authority for Advance Rulings under the Income-Tax Act, 1961, before the notified date, will stand transferred to the Court before which it would have been filed had this Act been in force on the date of filing of such appeal or application or initiation of the proceeding, and the Court may proceed to deal with such cases from the stage at which it stood before such transfer, or from any earlier stage, or de novo, as the Court may deem fit.
This Bill comes at a time when the Apex Court had struck down certain provisions of the Tribunal Reforms (Rationalisation and Conditions of Service) Ordinance, 2021 regarding conditions of service and tenure of Tribunal Members and Chairperson, in the judgment of Madras Bar Association v. Union of India & Another.
Now, challenging the constitutional validity of the Tribunals Reforms Act 2021, proposed by the Bill, Member of Parliament, Jairam Ramesh, has moved the Supreme Court.
Recently, the Top Court has also granted 10 days time to the Centre for making appointments to various Tribunals. The Apex Court questioned the fact that even though recommendations were given by the Selection Committee still the appointments were not made, and also expressed its critical views on the passage of the Tribunals Reforms Bill, 2021.
August 10, 2021 : With a view to maintain the Federal structure of the country, the Constitution (One Hundred and Twenty-seventh Amendment) Bill, 2021, was introduced in the Lok Sabha by Social Justice and Empowerment Minister Virendra Kumar on August 9, 2021.
The Bill clarifies that the State Government and Union Territories are empowered to prepare and maintain their own State List/ Union territory List of socially and educationally backward classes (SEBCs). It proposes to amend Articles 342A, 366 (26c) and 338B (9) of the Constitution of India.
With reference to the Constitution (One Hundred and Second Amendment) Act, 2018, the Bill has clarified that the said amendments to the Constitution mandate for a single Central List of SEBCs specifying the SEBCs for each State, thereby taking away the powers of the State to prepare and maintain a separate State List of SEBCs.
Earlier, the Constitution (One Hundred and Second Amendment) Act, 2018 had inserted three new articles, that is, 342A, 366(26C) and 338B in the Constitution. Article 338B constituted the National Commission for Backward Classes, Article 342A dealt with the Central List of the socially and educationally backward classes (commonly known as the Other Backward Classes) and Article 366 (26C) defined the socially and educationally backward classes.
This Bill comes after a decision rendered recently by the Supreme Court with a 3:2 majority in Dr. Jaishri Laxmanrao Patil & Ors v. The Chief Minister & Ors, popularly known as the Maratha Reservation case. The Constitution Bench comprised of Justices Ashok Bhushan, L.Nageswara Rao, S. Abdul Nazeer, Hemant Gupta and S.Ravindra Bhat.
Justice S.Ravindra Bhat opined that by the introduction of Articles 366 (26C) and 342A through the 102nd Amendment, the President alone, to the exclusion of all other authorities, is empowered to identify SEBCs and include them in a list to be published under Article 342A (1), which shall be deemed to include SEBCs in relation to each State and Union Territory for the purposes of the Constitution.
It was also noted that the states can, through their existing mechanisms or even statutory commissions, only make suggestions to the President or the Commission under Article 338B, for inclusion, exclusion or modification of castes or communities, in the list to be published under Article 342A (1).
The Bill has indeed circumvented this May, 2021 Supreme Court Judgment as it seeks to reinstate the power of the State Government and Union Territories to prepare and maintain their own List of SEBCs.
New Delhi, August 7, 2021: In a path-breaking move, the Central government has proposed to dilute the impact of the 2012 retrospective tax amendments by introducing the Taxation Laws (Amendment) Bill, 2021 in the Lok Sabha on August 5.
Owing to the voluminous tax litigation and investment arbitration that had taken place due to the retrospective amendments of the Finance Act, 2012, the Government unexpectedly took a bold step in attempting to re-write India’s story as an investment destination.
The Bill seeks to prevent the taxation of indirect transfers of money/assets that took place before May 28, 2012, with a provision of refunding the tax but without interest.
The executive’s action is likely to help settle disputes with Cairn Energy Plc, Vodafone Group Plc and many other companies over retrospective tax demands by the government.
It proposes to eclipse Explanation 5 to Section 9(1)(i) of the Income Tax Act, 1961 and Section 119 of Finance Act, 2012 on fulfillment of certain peculiar conditions such as withdrawal or furnishing of undertaking for withdrawal of pending litigation and furnishing of an undertaking that no claim for cost, damages, interest, etc., shall be filed.
As far as delegated legislation is concerned, Section 9 of the Income Tax Act, 1961 relating to deemed accrual or arise of income in India, is amended empowering the Central Board of Direct Taxes (CBDT) to make rules to provide for the form and manner in which an undertaking shall be submitted.
Further, Section 119 of the Finance Act, 2012 relating to validation of demands under Income Tax Act has also been amended empowering the CBDT to make rules to provide for the form and manner in which an undertaking shall be submitted.
The Bill also clarified that an asset or a capital asset being any share or interest in a company or entity registered or incorporated outside India shall be deemed to be and shall always be deemed to have been situated in India, if the share or interest derives, directly or indirectly, its value substantially from the assets located in India.
However, the Bill provided relaxation on deemed accrual of income comprising of an asset or capital asset, which is held by a non-resident by way of investment, directly or indirectly, in a Foreign Institutional Investor (FII) for an assessment year commencing on or after April 01, 2012 but before April 01, 2015.
The Bill also exempts capital assets held by a non-resident by way of investment, directly or indirectly, in Category-I or Category-II foreign portfolio investor under the SEBI Regulations, 2014 from the embargo of Section 9(1) of Income tax Act.
The Finance Act, 2012, amended various provisions of the Income Tax Act, 1961 with retrospective effect. The amendments were introduced by then Finance Minister Pranab Mukherjee.
July 29, 2021
The Union Cabinet on July 28 cleared amendments to the Deposit Insurance Credit Guarantee Corporation or DICGC Act.
As per the fresh amendments to the act, depositors in stressed banks that have faced regulatory action must receive insurance on their bank deposits — to the tune of Rs 5 lakh — within 90 days. The new rule will be applicable to all commercial banks and branches of foreign banks operating in India.
The 90-day period will be divided into two periods of 45 days. “The stressed bank is expected to collate all information regarding the number of claimants and claim amount and inform DICGC about it within the first 45 days. Within the next 45 days, DICGC is mandated to process the claim and make payment to each eligible depositor,” Finance Minister Nirmala Sitharaman said during a cabinet briefing on July 28.
This rule will be applicable to stressed banks that have been placed under a moratorium by the Reserve Bank of India, Sitharaman said.
“Under DICGC Bill 2021, 98.3 per cent of all deposits will get covered and in terms of deposit value, 50.9 per cent deposit value will be covered. Global deposit value is only 80 per cent of all deposit accounts. It only covers 20-30 per cent of the deposit value,” she said.
The finance minister also stressed on the fact that the deposit insurance coverage apply to banks that will be put under moratorium in future as well as those that are already under moratorium.
“We are not going retrospective. But banks that are presently under moratorium will come under this. And this will be the future process,” she said.
The DICGC is a subsidiary of the Reserve Bank of India (RBI) and provides insurance cover on bank deposits. The act covers all public, private, cooperative and foreign banks in India, barring some specific deposits.
July 23, 2021
The Central government on July 22, 2021 introduced the Inland Vessels Bill, 2021, in the Lok Sabha during the Monsoon Session of Parliament.
According to the government, the Bill aims to promote economical and safe transportation and trade through inland waters, and bring uniformity in the application of the law relating to inland waterways and navigation within the country.
Introducing the Inland Vessels Bill, 2021, newly appointed Ports, Shipping and Waterways Minister Sarbananda Sonowal said the bill seeks to provide safety of navigation, protection of life and cargo and prevention of pollution that may be caused.
The Bill provides for a central database for recording the details of the vessels and their crew on an electronic portal.
One of the key features of the Bill is unified law for the country, instead of separate rules framed by the States. The certificate of registration granted under the proposed law will be deemed to be valid in all States and Union territories, and there will be no need to seek separate permissions from States.
Currently, 4,000 kms of inland waterways are operational in the country, according to government data.
July 16, 2021
The Ministry of Civil Aviation (MoCA) on July 15 released the updated draft Drone Rules, 2021 for public consultation.
The new Rules will soon replace the Unmanned Aircraft System (UAS) Rules, 2021 that were released on March 12, 2021.
The last date for receipt of public comment is August 5, the MoCA said in a statement.
The Ministry, in the statement, said the new simplified drone rules will abolish the need for a large number of approvals. The number of forms to be filled to seek authorisation before operating a drone has been reduced from 25 to six, it said.
According to the draft Drone Rules 2021, operating drones without a unique identification number will not be allowed, unless exempted. Drone operators will have to generate a unique identification number of a drone by providing requisite details on the Digital Sky Platform.
The Digital Sky Platform is an initiative by MoCA to provide a secure and scalable platform that supports drone technology frameworks, such as NPNT (no permission, no take-off), designed to enable flight permission digitally and managing unmanned aircraft operations and traffic efficiently.
The Digital Sky Platform will also be developed as a business-friendly single-window online system with minimal human interference and most permissions will be self-generated.
The draft Drone Rules, 2021 also have safety features such real-time tracking beacon, and geo-fencing, which are expected to be notified in future and a six-month lead time will be provided for compliance.
The draft Drone Rules, 2021 also state that an interactive airspace map with green, yellow, and red zones will be displayed on the digital sky platform. While yellow zone has been reduced from 45 km to 12 km from nearby airport perimeter, no flight permission is required up to 400 feet in green zones and up to 200 feet in the area between 8 and 12 km from the airport perimeter.
No pilot licence will be required for micro drones used for non-commercial use, nano drones and for research and development (R&D) organizations operating such drones.
Unlike the previous rules, which required drone operators to have a principal place of business within India, and the chairman and at least two-thirds of its directors were required to be citizens of India, in the new proposed rules there are no such restrictions for foreign-owned companies registered in India.
However, import of drones and drone components will be regulated by the Directorate General of Foreign Trade.
Drones will also not need security clearance before registration or licence issuance.
“There will be no restriction on drone operations by foreign-owned companies registered in India; import of drones and drone components will be regulated by DGFT; security clearance will not be required before any registration or licence issuance; and that there will be no requirement of certificate of airworthiness, unique identification number, prior permission and remote pilot licence for R&D entities,” the new Rules further state.
The MoCA will also facilitate development of drone corridors for cargo deliveries and a drone promotion council will be set up to facilitate a business-friendly regulatory regime, the ministry said in the statement.
July 1, 2021
The Law Ministry has notified an Ordinance that prohibits employees engaged in essential defence services from taking part in any agitation or strike.
The Essential Defence Services Ordinance 2021 comes in the backdrop of major federations affiliated with the 76,000 employees of the Ordnance Factory Board (OFB) making an announcement that they would go on indefinite strike from July 26 in protest against the government’s decision to corporatise the OFB.
The notification stated that President Ram Nath Kovind “is satisfied that circumstance exists for the Ordinance as Parliament is not in session”.
“Any person, who commences a strike which is illegal under this Ordinance or goes or remains on, or otherwise takes part in, any such strike, shall be punishable with imprisonment for a term which may extend to one year or with fine which may extend to ₹10,000 or both,” the Law Ministry notification said.
The notification added that anyone instigating or inciting others to take part in a strike declared illegal under the Ordinance shall also be punishable with imprisonment for a term that may extend up to two years, apart from having to pay fines.
The gazette notification said employees involved in the production of defence equipment, services and operation, or maintenance of any industrial establishment connected with the military, as well as those employed in repair and maintenance of defence products, will come under the purview of the Ordinance.
Following the Cabinet decision, Defence Minister Rajnath Singh said there would be no change in the service conditions of employees of the OFB, and the decision was aimed at boosting India’s defence manufacturing sector.
On June 16, the Union Cabinet approved a long-pending proposal to restructure the nearly 200-year-old Ordnance Factory Board — operating 41 ammunition and military equipment production facilities — into seven state-owned corporations to improve its accountability, efficiency and competitiveness.
June 3, 2021
The Central government on June 2, 2021 gave acceptance to the Model Tenancy Act, a move that is likely to overhaul the legal framework concerning rental housing across the country.
Hardeep Singh Puri, the Minister of Housing and Urban Affairs, said the Act will promote rental housing in the country, adding that “1.1 crore vacant houses available on rent will compliment PM’s vision of ‘Housing for All’ by 2022”.
The government had first released the draft of the MTA in 2019. The Act aims to bridge the trust deficit between tenants and landlords by clearly delineating their obligations.
Besides, The Act is expected to give a fillip to private participation in rental housing as a business model for addressing the huge housing shortage, the Ministry of Housing said.
Here are the key features of the Model Tenancy Act:
May 27, 2021
The Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021 were notified on February 25, 2021. The Rules have been notified under the Information Technology Act, 2000. The Act provides for the regulation of electronic transactions and cybercrime. The 2021 Rules replace the Information Technology (Intermediaries Guidelines) Rules, 2011.
The Rules came into effect on May 26.
The rules apply to various categories of online content providers such as social media platforms, OTT streaming services and online news providers.
Some of the key points relate to the setting up of grievance redressal systems and having local personnel to ensure compliance with rules. One requirement for large social media providers is that under certain conditions, they will have to trace the originator of a message.
The Rules require due diligence by intermediaries, who are “entities that store or transmit data on behalf of other persons”. According to the Rules, intermediaries include internet or telecom service providers, online marketplaces, and social media platforms.
There is also Code of Ethics for digital media publishers.
The Rules require the intermediaries and digital media publishers to provide for a grievance redressal mechanism. The intermediaries are required to designate a grievance officer to address complaints against violation of the Rules. Complaints must be acknowledged within 24 hours and disposed of within 15 days.
The Rules also say that in case of emergencies, the authorised officers may examine digital media content and the Secretary, MIB may pass an interim direction for blocking of such content.
March 25, 2021
The Lok Sabha on March 24, 2021 passed the Juvenile Justice (Care and Protection of Children) Amendment Bill, 2021 that has widened the ambit of ‘serious offences’ that a juvenile can be charged with.
According to the Juvenile Justice (Care and Protection of Children) Act, 2015, which this new bill amends, juvenile offences can be categorised as petty, serious and heinous.
With this bill, the government has brought offences that can garner a maximum punishment of more than seven years and a minimum punishment that is not prescribed or is of less than seven years under the ambit of ‘serious offences’.
It also makes offences with punishments ranging from three to seven years as cognisable from non-cognisable. This means that a juvenile accused of such offences can be arrested without a warrant.
The new bill also empowers district magistrates (DMs) and additional DMs to issue adoption orders, in a bid to strengthen the child care system and adoption processes.
It also changes the criteria for appointments to child welfare committees (CWC) and makes it mandatory for the personnel to either have a background in or be a practicing professional in health, education or children’s welfare.
The bill was passed unanimously in the Lok Sabha.
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.
‘A major issue for startups, especially during fund raising, is their compliance with extant RBI foreign exchange regulations, pricing guidelines, and the Companies Act 2013.’- Aakash Parihar
Aakash Parihar is Partner at Triumvir Law, a firm specializing in M&A, PE/VC, startup advisory, international commercial arbitration, and corporate disputes. He is an alumnus of the National Law School of India University, Bangalore.
How did you come across law as a career? Tell us about what made you decide law as an option.
Growing up in a small town in Madhya Pradesh, wedid not have many options.There you either study to become a doctor or an engineer. As the sheep follows the herd, I too jumped into 11th grade with PCM (Physics, Chemistry and Mathematics).However, shortly after, I came across the Common Law Admission Test (CLAT) and the prospect of law as a career. Being a law aspirant without any background of legal field, I hardly knew anything about the legal profession leave alone the niche areas of corporate lawor dispute resolution. Thereafter, I interacted with students from various law schools in India to understand law as a career and I opted to sit for CLAT. Fortunately, my hard work paid off and I made it to the hallowed National Law School of India University, Bangalore (NSLIU). Joining NLSIU and moving to Bangalorewas an overwhelming experience. However, after a few months, I settled in and became accustomed to the rigorous academic curriculum. Needless to mention that it was an absolute pleasure to study with and from someof the brightest minds in legal academia. NLSIU, Bangalore broadened my perspective about law and provided me with a new set of lenses to comprehend the world around me. Through this newly acquired perspective and a great amount of hard work (which is of course irreplaceable), I was able to procure a job in my fourth year at law school and thus began my journey.
As a lawyer carving a niche for himself, tell us about your professional journey so far. What are the challenges that new lawyers face while starting out in the legal field?
I started my professional journey as an Associate at Samvad Partners, Bangalore, where I primarily worked in the corporate team. Prior to Samvad Partners, through my internship, I had developed an interest towards corporate law,especially the PE/VC and M&A practice area. In the initial years as an associate at Samvad Partners and later at AZB & Partners, Mumbai, I had the opportunity to work on various aspects of corporate law, i.e., from PE/VC and M&A with respect to listed as well as unlisted companies. My work experience at these firms equipped and provided me the know-how to deal with cutting edge transactional lawyering. At this point, it is important to mention that I always had aspirations to join and develop a boutique firm. While I was working at AZB, sometime around March 2019, I got a call from Anubhab, Founder of Triumvir Law, who told me about the great work Triumvir Law was doing in the start-up and emerging companies’ ecosystem in Bangalore. The ambition of the firm aligned with mine,so I took a leap of faith to move to Bangalore to join Triumvir Law.
Anyone who is a first-generation lawyer in the legal industry will agree with my statement that it is never easy to build a firm, that too so early in your career. However, that is precisely the notion that Triumvir Law wanted to disrupt. To provide quality corporate and dispute resolution advisory to clients across India and abroad at an affordable price point.
Once you start your professional journey, you need to apply everything that you learnt in law schoolwith a practical perspective. Therefore, in my opinion, in addition to learning the practical aspects of law, a young lawyer needs to be accustomed with various practices of law before choosing one specific field to practice.
India has been doing reallywell in the field of M&A and PE/VC. Since you specialize in M&A and PE/VC dealmaking, what according to you has been working well for the country in this sphere? What does the future look like?
India is a developing economy, andM&A and PE/VC transactions form the backbone of the same. Since liberalization, there has been an influx of foreign investment in India, and we have seen an exponential rise in PC/VA and M&A deals. Indian investment market growth especially M&A and PE/VC aspects can be attributed to the advent of startup culture in India. The increase in M&A and PE/VC deals require corporate lawyersto handle the legal aspects of these deals.
As a corporate lawyer working in M&A and PE/VC space, my work ranges from drafting term-sheets to the transaction documents (SPA, SSA, SHA, BTA, etc.). TheM&A and PE/VC deal space experienced a slump during the first few months of the pandemic, but since June 2021, there has been a significant growth in M&A and PE/VC deal space in India. The growth and consistence of the M&A and PE/VC deal space in India can be attributed to several factors such as foreign investment, uncapped demands in the Indian market and exceptional performance of Indian startups.
During the pandemic many businesses were shut down but surprisingly many new businesses started, which adapted to the challenges imposed by the pandemic. Since we are in the recovery mode, I think the M&A and PE/VC deal space will reach bigger heights in the comingyears. We as a firm look forward to being part of this recovery mode by being part of the more M&A and PE/VC deals in future.
You also advice start-ups. What are the legal issues or challenges that the start-ups usually face specifically in India? Do these issues/challenges have long-term consequences?
We do a considerable amount of work with startupswhich range from day-to-day legal advisory to transaction documentation during a funding round. In India, we have noticed that a sizeable amount of clientele approach counsels only when there is a default or breach, more often than not in a state of panic. The same principle applies to startups in India, they normally approach us at a stage when they are about to receive investment or are undergoing due diligence. At that point of time, we need to understand their legal issues as well as manage the demands of the investor’s legal team. The majornon-compliances by startups usually involve not maintaining proper agreements, delaying regulatory filings and secretarial compliances, and not focusing on proper corporate governance.
Another major issue for startups, especially during fund raising, is their compliance with extant RBI foreign exchange regulations, pricing guidelines, and the Companies Act 2013. Keeping up with these requirements can be time-consuming for even seasoned lawyers, and we can only imagine how difficult it would be for startups. Startups spend their initial years focusing on fund-raising, marketing, minimum viable products, and scaling their businesses. Legal advice does not usually factor in as a necessity. Our firm aims to help startups even before they get off the ground, and through their initial years of growth. We wanted to be the ones bringing in that change in the legal sector, and we hope to help many more such startups in the future.
In your opinion, are there any specific India-related problems that corporate/ commercial firms face as far as the company laws are concerned? Is there scope for improvement on this front?
The Indian legal system which corporate/commercial firms deal with is a living breathing organism, evolving each year. Due to this evolving nature, we lawyers are always on our toes.From a minor amendment to the Companies Act to the overhaul of the foreign exchange regime by the Reserve Bank of India, each of these changes affect the compliance and regulatory regime of corporates. For instance, when India changed the investment route for countries sharing land border with India,whereby any country sharing land border with India including Hong Kong cannot invest in India without approval of the RBI in consultation with the central government,it impacted a lot of ongoing transactions and we as lawyers had to be the first ones to inform our clients about such a change in the country’s foreign investment policy. In my opinion, there is huge scope of improvement in legal regime in India, I think a stable regulatory and tax regime is the need for the hour so far as the Indian system is concerned. The biggest example of such a market with stable regulatory and tax regime is Singapore, and we must work towards emulating the same.
Your boutique law firm has offices in three different cities — Delhi NCR, Mumbai and Bangalore. Have the Covid-induced restrictions such as WFH affected your firm’s operations? How has your firm adapted to the professional challenges imposed by the pandemic-related lifestyle changes?
We have offices in New Delhi NCR and Mumbai, and our main office is in Bangalore. Before the pandemic, our work schedule involved a fair bit of travelling across these cities. But post the lockdowns we shifted to a hybrid model, and unless absolutely necessary, we usually work from home.
In relation to the professional challenges during the pandemic, I think it was a difficult time for most young professionals. We do acknowledge the fact that our firm survived the pandemic. Our work as lawyers/ law firms also involves client outreach and getting new clients, which was difficult during the lockdowns. We expanded our client outreach through digital means and by conducting webinars, including one with King’s College London on International Treaty Arbitration. Further, we also focused on client outreach and knowledge management during the pandemic to educate and create legal awareness among our clients.
‘It’s a myth that good legal advice comes at prohibitive costs. A lot of heartburn can be avoided if documents are entered into with proper legal advice and with due negotiations.’ – Archana Balasubramanian
Archana Balasubramanian is the founding partner of Agama Law Associates, a Mumbai-based corporate law firm which she started in 2014. She specialises in general corporate commercial transaction and advisory as well as deep sectoral expertise across manufacturing, logistics, media, pharmaceuticals, financial services, shipping, real estate, technology, engineering, infrastructure and health.
August 13, 2021:
Lawyers see companies ill-prepared for conflict, often, in India. When large corporates take a remedial instead of mitigative approach to legal issues – an approach utterly incoherent to both their size and the compliance ecosystem in their sector – it is there where the concept of costs on legal becomes problematic. Pre-dispute management strategy is much more rationalized on the business’ pocket than the costs of going in the red on conflict and compliances.
Corporates often focus on business and let go of backend maintenance of paperwork, raising issues as and when they arise and resolving conflicts / client queries in a manner that will promote dispute avoidance.
Corporate risk and compliance management is yet another elephant in India, which in addition to commercial disputes can be a drain on a company’s resources. It can be clubbed under four major heads – labour, industrial, financial and corporate laws. There are around 20 Central Acts and then specific state-laws by which corporates are governed under these four categories.
Risk and compliance management is also significantly dependent on the sector, size, scale and nature of the business and the activities being carried out.
The woes of a large number of promoters from the ecommerce ecosystem are to do with streamlining systems to navigate legal. India has certain heavily regulated sectors and, like I mentioned earlier, an intricate web of corporate risk and compliance legislation that can result in prohibitive costs in the remedial phase. To tackle the web in the preventive or mitigative phase, start-ups end up lacking the arsenal due to sheer intimidation from legal. Promoters face sectoral risks in sectors which are heavily regulated, risks of heavy penalties and fines under company law or foreign exchange laws, if fund raise is not done in a compliant manner.
It is a myth that good legal advice comes at prohibitive costs. Promoters are quick to sign on the dotted line and approach lawyers with a tick the box approach. A lot of heartburn can be avoided if documents are entered into with proper legal advice and with due negotiations.
Investment contracts, large celebrity endorsement contracts and CXO contracts are some key areas where legal advice should be obtained. Online contracts is also emerging as an important area of concern.
When we talk of scope, arbitration is pretty much a default mechanism at this stage for adjudicating commercial disputes in India, especially given the fixation of timelines for closure of arbitration proceedings in India. The autonomy it allows the parties in dispute to pick a neutral and flexible forum for resolution is substantial. Lower courts being what they are in India, arbitration emerges as the only viable mode of dispute resolution in the Indian commercial context.
The arbitrability of disputes has evolved significantly in the last 10 years. The courts are essentially pro-arbitration when it comes to judging the arbitrability of subject matter and sending matters to arbitration quickly.
The Supreme Court’s ruling in the Vidya Drolia case has significantly clarified the position in respect of tenancy disputes, frauds and consumer disputes. It reflects upon the progressive approach of the court and aims to enable an efficient, autonomous and effective arbitration environment in India.
Law firms stand for ensuring that the law works for business and not against it. Whatever the scope of our mandate, the bottom line is to ensure a risk-free, conflict-free, compliant and prepared enterprise for our client, in a manner that does not intimidate the client or bog them down, regardless of the intricacy of the legal and regulatory web it takes to navigate to get to that end result. Lawyers need to dissect the business of law from the work.
This really involves meticulous, detail-oriented, sheer hard work on the facts, figures, dates and all other countless coordinates of each mandate, repetitively and even to a, so-called, “dull” routine rhythm – with consistent single-mindedness and unflinching resolve.
As a firm, multiply that effort into volumes, most of it against-the-clock given the compliance heavy ecosystem often riddled with uncertainties in a number of jurisdictions. So the same meticulous streamlining of mandate deliverables has to be extrapolated by the management of the firm to the junior most staff.
Further, the process of streamlining itself has to be more dynamic than ever now given the pace at which the new economy, tech-ecosystem, business climate as well as business development processes turn a new leaf.
Finally, but above all, we need to find a way to feel happy, positive and energized together as a team while chasing all of the aforesaid dreams. The competitive timelines and volumes at which a law firm works, this too is a real challenge. But we are happy to face it and evolve as we grow.
We always as a firm operated on the work from anywhere principle. We believed in it and inculcated this through document management processes to the last trainee. This helped us shut shop one day and continue from wherever we are operating.
The team has been regularly meeting online (at least once a day). We have been able to channel the time spent in travelling to and attending meetings in developing our internal knowledge banks further, streamline our processes, and work on integrating various tech to make the practice more cost-effective for our clients.
By Kumar Shashwat
June 22, 2022
Character merchandising can be defined as the revision or secondary utilization, by the creator of an imaginary character or by a real human being or by one or several sanctioned third parties, of the indispensable personality characteristics (such as the name, image or appearance) of a character in relation to a range of goods and/or services with an outlook to creating in potential consumers a yearning to get hold of those goods and to use those services because of the customers’ attraction with that character. It should already be highlighted that the person or legal entity which will systematize the merchandising activity (the merchandiser) will infrequently be the creator of the fictional character or the real person concerned. The various property or personality rights vesting in the character will be the subject matter of contracts (such as transfer or license agreements or product or service endorsement agreements), enabling one or more than a few involved third parties to be regarded as authorized users of the character.
Registration of Character Trade Marks
The primary function of marks that are symbols in its real sense is to indicate the origin of the goods so that the consumers can distinguish who is responsible for the goods that are placed in public. On the one hand, the creator of the fictional characters is not themselves engaged in such merchandising activities. Still, they may want to procure the trademark rights for their characters in order to regulate and license their use for commercial or merchandising purposes. On the other hand, sportspersons, actors, and pop stars use their characters most rewardingly.
However, in English Law, the Trade Marks Act 1938 prohibits the use of the trademark for trafficking, dealing mainly in a commodity in the right and not primarily to indicate or identify merchandise in which the owner of the trademark is interested; do not contain such restrictions with respect to the registration of trademarks.
In Tarzan, the candidates who were solely qualified to produce movies, records, and commercialization concerning the renowned anecdotal character Tarzan were denied enlisting the word Tarzan in relation to movies, attractive tape recordings, amusement toys and merchandise. The Court of Appeal held that since the word Tarzan was outstanding and was a piece of the dialect, it neglected to meet all requirements for enrolment as a developed or invented word. It was additionally held that the word had an immediate reference to the character and nature of the items since a film managing the endeavours of Tarzan would be portrayed as a “Tarzan” film, and the candidates’ different items were merchandise connected with Tarzan. Hence, the trademark was not considered to be fit for recognizing the candidates’ merchandise. Tarzan couldn’t be enlisted as a trademark because of the way that it spoke of the character and subsequently did not appear to show the origin of the items.
The idea that fame acts as the central impediment to getting the registration of a trademark was further explained in the Elvis Presley case. The candidates, who were the legitimately perceived successors of any promoting exercises carried for the famous personality Elvis Presley, were denied enlisting of the words ” Elvis” and “Elvis Presley”, and the mark “Elvis A. Presley” regarding toiletries. The Court said that every one of the products for which enrollment was looked for was legitimately viewed as memorabilia since they were promoted principally because of their connection with the name and picture of Elvis Presley. It was in this manner held that the imprints were not unmistakable; buyers obtained stock identifying with Elvis Presley, not because they considered that Elvis Presley Enterprises showcased it, but since it conveyed the name or picture of Elvis Presley. The Court’s view was that the general population is occupied with acquiring the merchandise identified with a most loved name as a famous person and is not concerned whether licensees of such a big name create such items. Finally, the Court held that when a character is well known, it is exceptionally far-fetched that the check will mean the inception of the item.
Also, in the Diana case, the executrices of the Estate of Diana, Princess of Wales connected to enlist as a trademark the words “Diana, Princess of Wales” for a wide variety of products and ventures. However, the application was rejected since it was held that the words Diana, Princess of Wales needed peculiarity. It was held that while most individual names might be considered to symbolize the inception of the merchandise, this is not the situation where an acclaimed name is worried; in such cases, it is conceivable that the name will serve to mean the topic of the items, rather than its beginning. It was further held that a normal customer would not expect that all memorabilia bearing the Princess’ name were marketed under the control of one undertaking in charge of their quality.
Exactly when an anecdotal character is introduced in academic work, as a creative work, or an abstract work, it is spoken to by the gauges of copyright law. Usually, the makers of the works hold copyright over these characters. When these characters are a part of a film or the producer has copyrights over the character. Note that the copyright may not come to exist in any fictional character appearing in a copyrighted work without any other person’s information. For such a character to be freely secured under the degree of copyright certification, the character must be managed independently of the story, cartoon or movie that it belongs to. In this instance, Star India v. Leo Burnett, the above was noted:
“The fictional characters are generally drawings in which copyright subsists, e.g., cartoon, and celebrities are living beings who are otherwise very famous in any particular field, e.g., film stars, sportsmen. It is necessary for character merchandising that the characters to be merchandised must have gained some public recognition, that is, achieved a form of independent life and public recognition for itself independently of the original product or independently of the milieu/area in which it appears. Only then can such character be moved into the area of character merchandising. This presumes that the character has independently acquired such reputation as to be a commodity in its own right independently of the goods or services to which it is attached or the field/area in which it originally appears. It is only when this is established on evidence as a fact, that the claimant may be able to claim a right to prevent anyone else from using such a character for other purposes.”
The producer of a film won’t have full rights to exploit the characters that can’t be disengaged from the performer portraying the same. In such a case, the character benefits of the performing craftsman apply despite the producer’s copyrights. This, from time to time, offers a climb to a battle between the two sorts of rights. For example, there has been a conflict between a performing artist assuming the part of a well-known character Gutthi in an Indian TV show and a TV station, which is additionally the maker of the arrangement. Because of this conflict, the performing artist moved out of the show and went ahead to begin his new show on an alternate TV slot. The principal TV slot issued an open proclamation that the character Gutthi had been made for the first show. Thus, it has copyright over the same. The on-screen character issued another announcement declaring his identity rights and saying that it is he who has accomplished acknowledgement as and is constantly related to Gutthi. Inferable from this conflict of rights, none of the parties could utilize the character Gutthi in their separate shows amid the season of the conflict. Identity rights unmistakably apply in instances of superstar marketing. Copyright is relevant just to the degree there are photos of superstars, and they are to be popularized; the picture takers have rights over the photographic works.
Since the vital character components of fanciful and authentic people are utilized as a part of the connection to business articles, trademark law standards likewise come into light in instances of character promotion. For example, in India, a trademark is known as any gadget, heading, plan, mark, word, name, signature, and so on which is fit for a graphical representation and which ought to be equipped for recognizing merchandise and/or administrations of one gathering from those of the other. This broad clarification makes it conceivable to have any anecdotal or real individual’s crucial identity elements as trademarks. For example, the name of a character and his picture, signature, character outlines, voice, catchphrases he utilized, and so forth could be ensured under trademark law.
When it comes to craftsmanship, one needs to consider the most unmistakable identity properties that are celebrated and deserving of trademark security. Character promoting is the initial step for treating acclaimed anecdotal characters or genuine identities as exchange signs. Famous people additionally authorize their identity and name rights under the laws of passing off. For example, in a noteworthy case concerning the identity and trademark privileges of the well-known pop singer “Daler Mehndi”, the pop star and his partner, the offended party, could effectively uphold trademark rights over the name “Daler Mehndi” against the respondents who earned tremendous financial gains by the offering of toys in light of his identity. Even though the name of Daler Mehndi or his fundamental identity components were not enrolled as trademarks, custom-based law gives exclusive privileges to the pop star in his name and identity. The productive instance of passing off could be brought for the execution of customary law marketing rights by the proprietors of such characters in case crucial parts of their characters’ personalities are used without their endorsement. Getting statutory trademark security is also profitable in bringing actual blue instances of trademark infringement against manhandling. The proprietors of universally acclaimed characters like Batman, Harry Potter and so forth have likewise procured statutory rights by enlisting the characters’ names as trademarks in India. On the Indian side, the proprietors of the fictional character Munnabhai (that showed up in the motion picture titled “Munnabhai MBBS” and its continuation “Lage Raho Munnabhai”) have additionally enlisted such character name as a trademark.
 Tarzan Trade Mark  FSR 245, CA.
 Elvis Presley Trade Mark  RPC 543.
 Diana Princess of Wales Trade Mark  ETMR 25. See also the similar view of Isaac,B., ‘Merchandising or Fundraising? Trade Marks and the Diana, Princess of Wales Memorial Fund’ (1998) 20 European Intellectual Property Review 441.
1. Ahuja V K, Law Relating to Intellectual Property Rights (English), Lexis Nexis, 2nd Edition, 2013.
2. Wadehra B L, Law Relating to Intellectual Property (English), Universal Law Publication, 5th Edition, 2012.
3. Ananth Padmanabhan, Intellectual Property Rights HB (English), Lexis Nexis- New Delhi, 1st Edition (Hardcover), 2012.
1. John Perry Barlow, The Economy of Ideas, Wired, Mar. 1994
2. Emem Uduak Udobong, Copyright infringement in the search engine, December 2005.
Kumar Shashwat is Founding Partner at Kumar & Singh Associates.
By Deo Prakash Singh
June 2, 2022
Disciplinary proceedings are the documented rules that define the relationship and control between a master and a servant. The power of the master to exercise control over the servant is to maintain and sustain the working environment at the workplace to achieve the dedicated goal and objectives. It signifies the obligation of the servant to obey and act in accordance with the code of conduct formulated by the master.
Disciplinary action is imposed by the employer on an employee against an act of misconduct by ordering punishment. The proceedings are perhaps the most vast and litigated branches in India and are full of dilemmas and dogmas. Service matters have the maximum number of commentaries, statutes, rules and regulations. The author here tries to discuss disciplinary proceedings — how they are conducted in public service tribunals, the procedure through which cases filed, and how they are conducted.
The general conception that a government job, in contrast to a private job, is a safe and secure job that ensures uninterrupted pay, perks and other service benefits is a misnomer. The statement may be true to a considerable extent because of the play and importance of natural justice in conducting disciplinary proceedings in public service. But the master in this case is that the mighty state has the capacity to diminish the future prospects of a government delinquent employee. Not only this, in public service the government delinquent employee has no way except to knock the doors of the court which is a time-taking and expensive exercise that sometimes even remains undecided. During the pendency of the litigation the employee may be deprived of service benefits and promotions. It is very difficult to decide between the two — whether justice delayed is justice denied or justice hurried is justice buried. The principle of natural justice sometimes derails from its impregnated objective.
Natural Justice and Disciplinary Proceedings
The principles of natural justice, generally, are taken care of while conducting disciplinary proceedings.
Article 311 of the Constitution of India guarantees the protection of rights of civil servants against arbitrary dismissal, removal and reduction in rank. This protection is not available where the employee has been convicted of a criminal charge or the competent authority is satisfied that compliance with the rules of natural justice is not reasonably practicable or the President or the Governor is satisfied that holding of an enquiry is not expedient in the interest of the security of the state. This is one of the express exceptions referred to in Article 310 and not subject to any control by any other provision of the Constitution. This provision in the Constitution aims at providing security of tenure to a government servant. This shield is a security to the extent of providing certain safeguards which have been made conditions precedent for dismissal or removal or reduction in rank of a government servant.
It is established that the principle of natural justice mainly comprises of following two rules:
(I) no person is to be condemned without hearing
(II) no person shall be a judge of his own cause
These two are the basic features. It means that fairness in conducting the proceedings shall be the essence of practice and the delinquent employee should be treated fairly which may culminate into punishment. The fairness principle requires a tribunal to proceed and hear the aggrieved employee on the points of law and procedure of fairness to protect the rights ensconced in the law book.
Elements of Disciplinary Proceedings
The proceedings are conducted under the domestic jurisdiction of the employer. To hold an enquiry into the misconduct of the employee is the most important feature and a precondition to the imposition of any punishment on a public servant. It is a universal principle and procedure because of the fact that almost all government servants and employees of statutory corporations or government companies are governed by rules which generally provide for a detailed procedure to be followed before imposing any punishment.
A departmental proceeding is a quasi-judicial proceeding and hence the enquiry officer’s performance a quasi-judicial function. The articles of charges levelled against the delinquent employee must be found to have been proved. The enquiry officer is duty-bound to arrive at a finding upon taking into consideration the materials brought on record by the parties. The proceeding has to be conducted against any person in a strict adherence to the statutory provisions and the principles of natural justice. The charges would be specific, definite and distinct setting out the details of the incident which forms the basis of the charges. No enquiry can be sustained on vague charges. The enquiry has to be conducted fairly, objectively but not subjectively. The findings should not be unreasonable and perverse nor the same should be based on conjectures and surmises. The court is very a specific on proof and suspicion. Every act or omission on the part of the delinquent employee cannot be a misconduct. The authority must record reasons for arriving at the findings of fact in the context of the statute defining the misconduct. Evidence adduced should not be perfunctory. Even if the delinquent employee does not take the defence or raise any protest, that does not absolve the inquiring authority from being vitiated for the reason particularly in respect of an order involving adverse or penal consequences.
Central Civil Services (Classification, Control and Appeal) Rules, 1965 under Rule 11 enumerated major and minor penalties and the procedure to conduct the disciplinary proceedings. It has also provided, under many decisions of the Government of India, the difference and definition of major and minor penalties in which major penalty shall be in case of grave and serious charges.
The Law provides for the establishment of Administrative Tribunal for the Union and the states specifying the jurisdiction and powers of such tribunals, procedure to be followed by the tribunals and excludes the jurisdiction of all courts except the Supreme Court.
The law also provides that the president in case of Union and the Governor in case of a state may make rules and regulations of services and posts in connection with the affairs of the state to such services.
Here it is important to include that only government servants throughout a state can file their respective cases in the tribunal to get their grievances redressed. It means that the tribunals are vested with the authority to hear the grievances of the employees of the state/Union only whereas further the employees working with private companies or organisations which are not owned by the state can only file their cases under industrial disputes in labour courts and industrial tribunals.
Normally the disciplinary authority appoints a preliminary enquiry officer to look into the alleged charges against the government servant and if the preliminary enquiry officer is prima facie guilty of the alleged misconduct, he may prepare a charge-sheet of the same and produce it before the disciplinary authority. The proceeding may not be known to the delinquent employee. The disciplinary authority on the basis of the charge-sheet submitted by the preliminary enquiry officer proceed to initiate departmental enquiry and it may start afresh and may not be from the point where the preliminary enquiry officer left. It is an established rule that the preliminary enquiry officer cannot be appointed as enquiry officer in the full-fledged enquiry as he may be prejudiced to the delinquent employee because he had already framed a charge-sheet against him in the preliminary enquiry.
Procedure To Conduct Enquiry In Case Of Major Penalty
The appointing authority/ disciplinary authority has to issue in order to initiate the disciplinary proceedings against the government servant. Sometimes the Governor of the state has to do the same as he is being the appointing authority of the specified government servants. The disciplinary authority may himself enquire into the charges or appoint an officer subordinate to the enquiry officer to enquire into the charges. The charge-sheet shall be approved by the disciplinary authority. The charges should be precise and clear to facilitate the government servant of the facts and circumstances against him. The documentary evidences and the names of witnesses proposed should prove the same along with oral evidence.
The delinquent government servant shall be required to submit a written statement of his defence in person within a specified time period mentioned in the book of rules preferably within 15 days from the date of issue/receipt of the order. The government servant shall have to state that whether he desires to cross examine any witness mentioned in the charge-sheet or whether he desires to produce some new or extra evidence. He shall also be informed that in case a written submission is not filed within the specified date it will be presumed that he has none to furnish and the enquiry officer shall proceed to complete the enquiry ex parte.
It has also been decided by a court judgement that after the charge-sheet is given to the employee, an oral enquiry is must and notice should be given to the employee intimating him about the date, time and place of enquiry. It has also been laid down in this case that if an opportunity to the employee to produce witnesses or to rebut the evidence against him is not given then the whole enquiry is liable to be quashed ab initio and the punishment on the basis of such enquiry report shall not be sustainable.
It is settled law that the documents relied in support of the charges have to be proved in departmental enquiry by the enquiry officer in the presence of the delinquent employee. The government servant is also at liberty to ask for documents in case they are mentioned in the charge-sheet. But is the same have not been annexed with the charge-sheet, then opportunity of inspection has to provided.
Per contra if the charged government employee admits the charges, the enquiry officer shall submit his report to the disciplinary authority without further proceedings in enquiry but where the charged government servant denies the charges, the enquiry officer shall proceed with the enquiry to call on the witnesses as per the rules framed under the law in the presence of the government employee who shall be given the opportunity to cross examine such witnesses. After recording the aforesaid evidence, the enquiry officer records oral evidence if the charged government servant desired so in his written defence submission. The enquiry officer may ask what he pleases at any time from any witness or from the person charged with a view to discover the truth or to obtain proof. The disciplinary authority may appoint a presenting officer to present the facts of charges from the government side whereas the charged government servant too can take help of a retired government employee or legal practitioner if the enquiry officer gives his consent for it.
When the enquiry is complete, the enquiry officer shall submit its enquiry report to the disciplinary authority along with all records. The report shall consist of sufficient record of brief facts, the evidence and statement of findings on each charge with reasons thereof but the enquiry officer shall not make any recommendation about the penalty. The enquiry officer shall have to submit his final report within six months from the date of issuance of the order by the disciplinary authority and he is bound to adhere to the time-limit. In any case the total time-limit to complete a disciplinary proceeding should not exceed 18 months from the date of initiation of the proceedings, i.e., from the date of issuance of the framing of charges letter.
If there is vigilance angle, the advice of CVC shall be sought and the time limit for the advice shall be maximum 30 days. For the second advice from the CVC, the same time-limit of 30 days shall be available. Similarly the time limit for concurrence from the UPSC shall be 30 days.
Stage of Tribunal
The cause of action arises due to the impugned punishment order by the disciplinary authority against the delinquent employee and here the role of lawyers come into play to represent the petitioner/the applicant under section 19 of the Administrative Tribunal Act, 1985. Before bringing a case of disciplinary proceeding to the tribunal, the aggrieved employee against whom an adverse order has been passed has to make representation to the appellate authority against the order. It is only after the representations remain unanswered by the authorities or if the delinquent employee has not been satisfied then he can bring his case to the tribunal. The government servant challenges an adverse order as bad order in the tribunal.
The aggrieved employee says in his submissions in the court that the proceeding conducted against him were unjust, unwarranted, malicious and/or arbitrary and the charges levelled against him are unjustified and against the principles of natural justice. The petitioner prays to quash the impugned order as if it had never been passed so that he may be entitled to all consequential service benefits to which he is entitled.
The petitioner may pray for interim relief but the interim relief sought should be different from the final relief. It is prayed in the court that if the impugned order is left to stand it will do irreparable loss to the petitioner.
Disciplinary action cannot be based on breach of statutory rules or administrative actions which do not supplement rules or are inconsistent with them. Before initiating any disciplinary proceeding the master must be prima facie satisfied that the employee has committed some misconduct. The misconduct must be committed during the tenure of the service. An allegation of misconduct against an officer in relation to his quasi-judicial functions cannot be made merely on the basis that he made a mistake of judgement while passing the order. This is because the administrative adjudication also requires to perform their functions without fear or favour which may be defeated by the constant threat of disciplinary proceedings.
Disciplinary proceedings cannot be initiated only on the basis of suspicion. There must be a reasonable basis. Those disciplinary proceedings shall be quashed if the exercise of power was not bona fide, e.g. anonymous complaints, biased preliminary enquiry and disregard to the directions of the Chief Justice by the full court. Similarly, if an employee is allowed to retire on attaining the age of superannuation even after initiation of disciplinary proceedings, major management cannot be imposed on him thereafter except under rare circumstances since retirement results in severance of relationship of master and servant.
Deo Prakash Singh an Advocate practicing at the Patna High Court.
By Pallavi Ghaisas
May 31, 2022
Prior to commencement of Real Estate (Regulation and Development) Act, 2016, (“RERA”), in landmark judgment in Vaidehi Akash Housing Pvt.Ltd. Vs. New D.N. Nagar Co-op.Housing Society Union Ltd. & Ors. [2015(3)ABR270] (“Vaidehi’s Judgement”), decided on 1st December 2014 by Hon’ble Justice S C Gupte of Hon’ble Bombay High Court, inter alia, decided the rights of third party purchasers (“Allottees”) under Maharashtra Ownership Flats Act, 1963 (“MOFA”) vis-à-vis society after termination of development agreement with Developer (“Ex-Developer”). It was observed that the development agreement executed by the Ex-Developer with the society was on principal to principal basis and as per agreement executed by the Allottees with Ex-Developer, the rights of Allottees thereunder were subject to Ex-Developer’s rights and not higher than those. It was held that (i) society was not a co-promoter U/s. 2 (c) of MOFA and was merely in the position of owner vis-à-vis third party purchasers and (ii) the purchasers did not have any enforceable right, under MOFA, against the Society or the New Developer appointed by society, after termination of development agreement with Ex-Developer.
B. RERA- Regime
In the matter of Peter Almeida and Tangerine Almeida vs. M/s. Shubh Enterprises and others [Compliant No. CC006000000055575], filed by complainants therein being allottees, facts are similar to the said Vaidehi matter, the essence being the society terminates the development agreement with Developer (Ex-Developer) and appoints a New Developer for construction on land held by society. The allottees who paid monies to the Ex-Developer for securing flats under allotment letter executed with Ex-Developer sought direction from Regulatory Authority, against the society and the New Developer, for (i) executing agreement for sale and (ii) allotting flat in newly constructed building.
The Maharashtra Real Estate Regulatory Authority, Mumbai (“Regulatory Authority”) by its order dated 5thNovember 2019 directed that registered agreement for sale to be executed with complainants therein (being allottees of Ex-Developer) in accordance with the allotment letter issued by Ex-Developer. The ratio of the Vaidehi’s Judgement was not applied by the Regulatory Authority inter alia for the reason that it was before commencement of RERA and it held that after transfer of development rights in favour of the New Developer, the commitment of Ex-Developer will have to be honoured by the New Developer and society.
By common judgement dated 6th May 2022 in the appeals filed therein, the Maharashtra Real Estate Appellate Tribunal dealt with the question of- “Whether Allottees are entitled to reliefs as claimed in the complaint against the Society and New Developer” while answering the same in negative, it was inter alia reasoned as follows:
i. Since Society is not a party to contract / agreement for sale executed between Allottees and the Ex-Developer, the society cannot be held liable to any obligations that are required to be performed by Ex-Developer towards Allottees;
ii. Society has no privity of contract with the Allottees and the transaction is purely and only between the Allottees and the Ex-Developer as per settled position of law;
iii. Project registered by the New Developer does not involve the circumstances where there is a transfer in its favour as contemplated under Section 15 of RERA
iv. Neither the society nor New Developer appointed by it are under obligation to recognise claims of allottees as prayed for in the complaint therein;
v. In the absence of privity of contract, the Society and New Developer cannot be held liable to Allottees and consequently Allottees are not entitled to reliefs as claimed against the Society and New Developer;
vi. Under these circumstances, since New Developer has already taken over the project, no flat can be made available to Allottees in the project;
vii. The alternative claim of Allottees for refund, if at all, can be considered only against the Ex-Developer who has received the amount of earnest money from Allottees.
The complaint was remanded to the Regulatory Authority for considering and deciding the claim of allottees afresh to the extent of refund of the amount against Ex-Developer after hearing the concerned Parties.
Impact of RERA Judgement on Third-Party Purchasers
There are many projects halted or abandoned by Developers almost everywhere. The Society in such cases usually terminates the Development Agreement and appoints a New Developer. In such circumstances the allottees who have paid monies to Ex-Developer will now have an option to enforce their rights against Ex-Developer, before RERA authorities, for refund of amount paid by them.
Pallavi Ghaisas is a Lawyer specialising in the field of Real Estate. She works at Federal & Company, a Mumbai-based law firm.
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