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“Karnataka High Court upholds Industrial Tribunal’s decision of reinstatement of wages for aggrieved labour” 

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Case Title: The Divisional Controller (South) v. Sri. Vasant B. Jogi 

Case No.: WRIT PETITION NO. 105424 OF 2023  

Dated: April 15, 2024 

Quorum: Justice Shivashankar Amarannavar  

 

FACTS OF THE CASE: 

The facts of the case include that the respondent, a driver for the petitioner corporation, was absent from work without permission from his superiors or submission of a leave request beginning on June 1, 2007.  

On the report of the depot manager dated June 22, 2007, a call notice dated September 17, 2007, was issued to the respondent directing him to report for duty. The respondent neither replied to the said notice nor reported to duty, and therefore, an Article of Charges dated April 24, 2008, was issued to him along with a statement of imputation. 

Respondent failed to submit his reply after receiving the Article of Charges; as a result, the disciplinary authority designated a Presenting Officer and an Enquiry Officer to conduct a domestic investigation into the respondent’s absence without authorization. 

By way of paper publication in the daily news paper “Vijaya Karnataka,” the enquiry notice was sent to the subject. After conducting research, the enquiry officer filed a report on their findings.  

The respondent received a show cause notice, but he declined to react. The respondent has been removed from the Corporation’s service by the disciplinary authority through its order of August 21, 2008.  

In accordance with Industrial Dispute Act of 1947, Section 33-A, the respondent filed a complaint. The Corporation, the petitioner, filed a statement of objections after showing up in response to the notification. The said complaint was partially accepted by the Industrial Tribunal after it heard the testimony of both sides. 

The respondent filed a complaint in line with the Industrial Dispute Act of 1947, Section 33-A. Following its appearance in response to the notification, the corporation, the petitioner, filed a statement of objections. The Industrial Tribunal heard testimony from both parties and partially accepted the aforementioned complaint. 

It also overturned the dismissal judgement dated August 21, 2008, which went into effect on March 28, 2014, and ordered the petitioner-Corporation to reinstate the respondent in his initial position with continuity of service with effect from March 28, 2014, on the grounds that the petitioner-Corporation has not received the necessary consent under Section 33(2)(b) of the Industrial Dispute Act.  

In this writ case, the petitioner-Corporation has questioned the aforementioned Industrial Tribunal ruling. 

CONTENTIONS OF THE PETITIONER: 

The petitioner’s learned counsel would argue that the worker who was fired remained silent for a full six years following the order of termination. Three years from the date of discharge, dismissal, or retrenchment is the statute of limitations for bringing a claim under Section 2-A(3). 

He further argued that in accordance with Section 33-A(b), the complaint filed under Section 33-A must be decided as though it were a dispute that was referred to or pending before it in accordance with the provisions of the ID Act. As a result, he claimed, the limitation contained in Section 2-A(3) of the ID Act applies and the complaint has passed the three-year statute of limitations.  

The petitioner also argued that the Tribunal’s decision to dismiss the case was deemed non-est because it failed to comply with Section 33(2)(b) and allowed the complaint through the challenged order without considering the merits of the respondent’s conduct or the charges against it.  

Lastly, it was argued that the tribunal must consider the legitimacy of the dismissal. The complaint has only been accepted by the tribunal on the grounds that Section 33(2)(b) of the Act was not followed, without taking into account the validity of the dismissal on its own merits.  

 

CONTENTIONS OF THE RESPONDENT: 

The counsel for the respondent argues that the tribunal must consider the validity of the dismissal and is relying on the ruling in a previous case. In an earlier case reported in AIR 2002 Supreme Court 643, learned counsel for the respondent would argue that the Constitution Bench of the Hon’ble Supreme Court of India concluded that failing to file an application under Section 33(2)(b) seeking an obvious instance of violating Section 33(2)(b) requirements, and the dismissal order is rendered null and invalid.  

The respondent further argues that since the Hon’ble Apex Court has not addressed the case cited by the petitioner, the decision made in this case will be interpreted per-incuriam, as a prior ruling by the Constitution Bench will address the case that has not been cited. 

Furthermore, the respondent argues that since the Hon’ble Apex Court has not addressed the case cited by the petitioner, the decision made in this case will be interpreted per-incuriam, as a prior ruling by the Constitution Bench will address the case in question before it has not been referred to. 

The respondent further asserts that the decision in this case will be interpreted per-incuriam, which means that the Constitution Bench’s earlier decision would handle the issue in question before it has not been referred to, because the Hon’ble Apex Court has not addressed the case that the petitioner stated.  

 

LEGAL PROVISION:  

  • Section 33-A of Industrial Dispute Act, 1947: Special provision for adjudication as to whether conditions of service, etc., changed during pendency of proceedings. In cases where an employer violates section 33 while the matter is pending [before a Labour Court, Tribunal, National Tribunal, Board, or Conciliation Officer] 
  • Section 33(2)(b) of Industrial Dispute Act. While a disagreement is pending, an employer has the authority to fire or dismiss employees who are engaged in an industrial dispute for any misbehaviour unrelated to the conflict. 

 

COURT’S ANALYSIS AND JUDGMENT: 

The court reviewed the information on file after hearing from the parties’ knowledgeable counsel. The court observed that the primary point that needed to be addressed was whether the petitioner-Corporation would have to comply with Section 33(2)(b) of the Act before issuing the order of dismissal, in which case the order would be null and void. 

The Division Bench of the Hon’ble Apex Court has deliberated and made a distinction in its ruling. After taking into account and separating the ruling of the Honourable Apex Court, the court determined that the worker’s dismissal order would be invalid due to the worker’s violation of Section 33(2)(b) of the Act. 

The court determined that a dispute involving a single worker qualified as an industrial dispute. Any dispute or disagreement between a worker and his employer related to, or arising out of, such discharge, dismissal, retrenchment, or termination shall be deemed to be an industrial dispute even in cases where no other worker or worker union is a party to the dispute. This is the case when an employer discharges, dismisses, retrenches, or otherwise terminates the services of an individual worker. 

Following 45 days from the date of his application to the appropriate Government’s conciliation officer for the conciliation of the dispute, the court made a direct application to the Labour Court or Tribunal for adjudication of the dispute referred to therein.  

Upon receipt of this application, the Labour Court or Tribunal will have the authority and jurisdiction to decide the dispute as though it were one referred to it by the appropriate Government in accordance with the provisions of this Act. All of the provisions of this Act will apply to this adjudication in the same manner as they do to an industrial dispute referred to it by the appropriate Government. 

 

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Judgment reviewed by Riddhi S Bhora. 

 

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Supreme Court grants Maharashtra domicile candidate admission despite parent’s deployment.

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Case title: Vansh S/O Prakash Dolas v. The Ministry of Education & The Ministry of Health & Family Welfare & Ors.

Case no.: Civil Appeal No(s). of 2024 (Arising out of SLP No(s). 26179-26180 of 2023)

Decided on: 20.03.2024

Quorum: Hon’ble Justice B R Gavai, Hon’ble Justice Sandeep Mehta, Hon’ble Justice Rajesh Bindal

FACTS OF THE CASE:

The case involved Vansh, the appellant, seeking admission under the OBC/NCL category as a domicile of Maharashtra. His admission was cancelled due to his father’s deployment outside Maharashtra as a paramilitary personnel. The appellant’s counsel argued that the cancellation was unjust and arbitrary, violating principles of natural justice. The appellant’s eligibility for admission was contested based on the deployment of his father, leading to a legal dispute regarding his rightful admission under the specified category.

LEGAL PROVISIONS:

Interpretation of admission rules and guidelines under NEET-UG, 2023.

Application of principles of natural justice and equality under constitutional law.

Consideration of precedents related to admissions and reservations in educational institutions.

Examination of legal provisions regarding domicile and admission eligibility criteria.

APPELLANTS CONTENTION:

The appellant contended that he fulfilled the criteria for admission in the State quota under the OBC/NCL category as a domicile of Maharashtra. He argued that the cancellation of his admission was unjust and arbitrary, violating principles of natural justice. The appellant’s counsel also highlighted that the appellant’s father’s deployment outside Maharashtra should not have affected his admission eligibility.

RESPONDENTS CONTENTION:

The respondents contended that the appellant could not be considered for admission under the OBC/NCL category under the State quota because he did not meet the criteria specified in clauses 4.5, 4.6, and 4.8 of the Information Brochure. They also argued that the appellant did not stake a claim for admission in the defense personnel quota, so he could not have been given a seat under that category as per the guidelines in clause 9.4.4.

COURT’S  ANALYSIS AND JUDGMENT:

The judgment revolved around the appellant’s case of denial of admission in a medical course due to his father’s deployment outside Maharashtra. The court considered the constitutional duty to address injurious consequences arising from arbitrary and illegal actions, emphasizing the need for restitutive relief.The court discussed the challenges faced by candidates like the appellant, whose parents are in defense services and are deployed outside their domicile state. It highlighted the need to transcend the constraints of time and perform the primary duty of a constitutional court to control and regulate the exercise of power or arbitrary action.

In the judgment, the court found that the Division Bench of the Bombay High Court at Nagpur had erred in rejecting the writ petition filed by the appellant. The court held that the impugned judgment was unsustainable in facts and law, emphasizing the need to consider the case in the correct perspective. Ultimately, the court ruled in favor of the appellant, stating that candidates born in Maharashtra with domicile parents should be entitled to a seat under the Maharashtra State quota, regardless of the parent’s place of posting. The court recommended changes in guidelines to ensure that meritorious candidates like the appellant are not unjustly denied admission due to circumstances beyond their control.

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Judgement reviewed by – Ayush Shrivastava

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Reassessment proceedings against Castrol India initiated due to change in opinion are quashed by the Bombay High Court

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Case Title:- Castrol Indian Limited Versus Deputy Commissioner of Income-tax Circle-1(2)(1), Mumbai and others

Case No: Writ Petition No.3079 OF 2022

Decided on: 5th March, 2024.

Quorum:

K. R. SHRIRAM & DR. NEELA GOKHALE, JJ.

Facts of the Case:-

The petitioner is a firm that was established under the Companies Act of 1956 and is involved in the production and marketing of specialty oils, greases, lubricating oils, and brake fluids. Under Section 135 of the Companies Act, 2013, the petitioner incurred expenses of Rs. 10,54,06,706/- towards Corporate Social Responsibility (“CSR”) during the assessment year 2016–17. According to the petitioner’s income return for the relevant assessment year, which has been updated from time to time, their total income was Rs. 10,51,29,97,660. In accordance with Explanation 2 Section 37 of the Act, a disallowance was given for the amount of CSR in the income return. Additionally, the petitioner contended that Section 80G of the Act permitted the deduction of Rs. 1,79,41,595/- or 50% of the total donation. The petitioner’s income return was chosen for examination. In accordance with Section 142(1) of the Act, a notification was sent on September 14, 2019, following the start of assessment procedures, asking specifics and corroborating data regarding the deduction claim. In response, the petitioner sent a letter dated November 30, 2019, inviting another notice dated November 14, 2019, under Section 142(1) of the Act, asking for documentation of donations to support the deduction claim. The letter was likewise replied on November 30, 2019.A Section 143(3) of the Act assessment order was made on January 14, 2020, completely allowing the claimed reduction. Nevertheless, the petitioner was notified on March 27, 2021, in accordance with Section 148 of the Act, providing grounds for suspecting that income assessed for taxation during the applicable assessment year has evaded payment. Evaluation and mandated that the petitioner submit a return for the specified evaluation year. Petitioner agreed, filing its return on April 27, 2021, but asked for a copy of the documented grounds for reopening assessment from the Assessing Officer (“AO”). The petitioner filed its objections on August 28, 2021, in response to a letter dated July 30, 2021, which presented reasons to think that income was being fled. The AO dismissed the objections by the contested ruling dated December 21, 2021. This order, together with a notice dated March 27, 2021, claiming that income has evaded assessment.

Appellant Contentions:-

The reopening of the assessment was challenged by Mr. Parmarwala (learned Senior Advocate), appearing for the petitioner, on the ground that the jurisdictional conditions had not been met in the present case. As the AO had formed his belief on the grounds of an audit objection, which did not meet an objective criterion. He also argued that the assessment could not be reopened based on a change of view, and that the belief should be based on new and tangible material that had a rational and living connection to the belief. Parmarwala aligned the legal arguments with the facts of the case, stating that: The petitioner had not asserted that the expenses incurred as business expenses could not be deducted under Section 80G. Section 80G does not require deductions to be made in respect of expenditure incurred outside of the scope of the Act. The AO had formed its belief regarding the diversion of income as a result of an audit objection applications of mind and had previously rejected the audit’s objection. Petitioner had provided sufficient information regarding expenditure by way of corporate social responsibility (CSR) and deduction under Section 80G of the Act, which were made available in its annual accounts, tax audit report, and the calculation of income which had already been considered by the AO when passing the initial assessment order. Deduction under section 80G of the law was expressly mentioned in the calculation sheet which formed the basis of the assessment order. Petitioner has not been satisfied with the satisfaction of the sanctioning authority, which suggests that there was no such approval. Mr Pardiwalla submits that the notice and order at issue are unreasonable and disclose an arbitrary exercise of powers. He therefore requests the Court to annual and set aside the order.

Respondent Contentions:-

Mr. Suresh Kumar, learned counsel appears for the revenue and justifies the impugned order by contending that since the deduction of CSR expenses are specifically disallowed under Section 37(1) read with Explanation 2 of the Act, the same cannot be allowed under Section 80G of the Act. While candidly admitting the audit objection, he however, asserts that the same itself is a source of Gaikwad RD information and constitutes ‘fresh tangible material’. Mr. Suresh Kumar further points out that although an amount of Rs.10,54,06,706/- appears in the profit and loss account showing debit on account of CSR expenses under the head ‘other expenses. This includes donation expenses of Rs.3,58,83,189/-. This amount has not been separately debited in the profit and loss account which was never disclosed by petitioner directly or indirectly. Mr. Suresh Kumar relies on the affidavit in reply filed by the department to buttress the objectives of providing for CSR which is to share the burden of the Government in providing social services by companies having a net worth. Mr. Suresh Kumar has tried to unveil an alleged strategy by which petitioner firstly incurs CSR expenses, without claiming any deduction since the same are disallowed as business expenditure, but thereafter adding back the expenditure in the computation of income. Thus, the CSR expenses are treated by petitioner under two different heads, defeating the very public welfare purpose by converting the same as a tax saving tool. Mr. Suresh Kumar, thus, urges us to dimiss the petition.

Court Analysis and Judgement:-

From the perusal of the documents, two glaring facts emerge. One is that all material/documents necessary for computing the income was disclosed and submitted by petitioner during the course of assessment proceedings leading to an irrefutable conclusion that there was no failure on the part of petitioner to disclose fully and truly all material facts. Secondly, there is a notable absence of any fresh tangible material coming to the knowledge of the AO and the reopening of assessment is purely on a re-examination of the very same material on the basis of which the original assessment order was passed. However, Assessing Officers without appreciating the true import of the aforesaid decision of the Supreme Court, continue to reopen assessments on the ground of income having escaped assessment despite the fact that all the material and information was already available with him while passing the original assessment order.

Furthermore, while conclusive proof of escapement of income may not be necessary to reopen an assessment, the least that is required is a requisite belief based on fresh and tangible material which was not accessible to the AO or that which was deliberately withheld by Assessee, which then would amount to non-disclosure of relevant information. The finding of the Apex Court in Rajesh Jhaveri (supra) must not be used by AO to reopen assessments to review the original assessment order on the basis of a change of opinion of the AO, as done in the present case. Further, the reasons to believe notice itself indicates that the AO was already seized with information prior to passing of the original assessment order and as such, there is no tangible information on the basis of which he has allegedly formed the requisite belief. In these circumstances, we have no hesitation in holding that the notice dated 27th March 2021 under Section 148 of the Act in respect of income having escaped assessment and the order dated 21st December 2021 passed by the AO rejecting the objections of petitioner impugned herein, are untenable and cannot be sustained in law. The Petition is allowed.

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Judgement Analysis Written by – K. Immey Grace

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A modification cannot be presumed to be arbitrary for the sole reason that it was mooted by a MLA: SC

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Case title: Sri Pubi Lombi Vs State of Arunachal Pradesh and Anr.

Case no.: CIVIL APPEAL NO. 4129 OF 2024

Decided on: 13.04.2024

Quorum: Hon’ble Justice J.K. Maheshwari, Hon’ble Justice Sanjay Karol

FACTS OF THE CASE:

The case involved a transfer order of Sri Pubi Lombi, the appellant, from the Government Higher Secondary School (GHSS) Kanubari. The transfer was based on a U.O. Note from the Member of Legislative Assembly (MLA) of the Basar(ST) Assembly Constituency. The appellant challenged the transfer order, alleging malafide exercise of power. The Single Judge upheld the transfer, but the Division Bench of the High Court reversed this decision.

LEGAL PROVISIONS:

Article 226 of the Constitution of India: Jurisdiction of High Courts for issuing writs.

Union of India and others Vs. S.L. Abbas (1993) 4 SCC 357: Scope of judicial review and the need to implead persons against whom allegations of malafide are made.

State of Punjab Vs. Joginder Singh Dhatt; AIR 1993 SC 2486: Employer’s discretion in transferring public servants.

APPELLANTS CONTENTION:

The appellant, Sri Pubi Lombi, contended that the transfer order based on the MLA’s note was a result of an arbitrary exercise of power. The appellant argued that the transfer was not in the exigencies of service or public interest but was solely based on the MLA’s recommendation. The appellant challenged the transfer order, alleging that it was not supported by administrative exigencies or reasons justifying the cancellation of the earlier transfer order.

RESPONDENTS CONTENTION:

The respondents, including the State of Arunachal Pradesh, supported the contention that the modified transfer order was passed in public interest after due consideration of the MLA’s U.O. Note. They argued that the Division Bench erred in setting aside the well-reasoned judgment of the Single Judge. The respondents emphasized that the transfer was made after the application of mind and in the interest of public service, contrary to the appellant’s claims of arbitrariness.

COURT’S ANALYSIS AND JUDGMENT:

The court analyzed the principles laid down in previous cases regarding the scope of judicial review in transfer matters. It emphasized that judicial interference in transfer orders is not warranted unless there are allegations of malafide, violation of statutory provisions, or if the transfer is detrimental to the employee holding a transferrable post. The court noted that the appellant’s plea of malafide against the transferring authority was not agitated before the court, and there was no violation of any prescribed statutory provision.

Based on these considerations, the court held that the Division Bench erred in setting aside the judgment of the Single Judge. The court allowed the Civil Appeal, setting aside the Division Bench’s judgment and restoring the order of the Single Judge dated 11.07.2023. The court concluded that the transfer order was not issued in the exigencies of service or public interest but was a result of an arbitrary exercise of power, supporting the appellant’s contention.

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Judgement reviewed by – Ayush Shrivastava

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“NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION OVERSTEPPED ITS POWERS AND JURISDICTION”: SUPREME COURT

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CASE TITLE:  Venkataraman Krishnamurthy and Anr. v. Lodha Crown Buildmart Pvt. Ltd.

CASE NO: Civil Appeal No. 971 of 2023

DECIDED ON: 1.03.2024

QUORUM:  Hon’ble Justice Sanjay Kumar

FACTS OF THE CASE

This Civil Appeal has been filed by the complainants aggrieved by the order passed by the National Consumer Disputes Redressal Commission (NCDRC). The respondent company was constructing a building wherein the appellant wished to buy an apartment. Hence, the appellant and the company entered an Agreement to Sell on 29.11.2023. After that, a four bhk flat in ‘Lodha Evoq’ was allotted to the appellants. As mentioned in the contract’s payment schedule, the appellants were supposed to make payments in four instalments, and the balance amount was to be paid at the time of fit-outs. When the complaint was filed, it was undisputed that the appellants were up to date with their payments in accordance with the contract. The contract further mentioned that the respondent party was supposed to hand out the apartment on two occasions: one for fit-outs by 30.06.2016 and the second for the offer of possession of the apartment along with the issuance of the occupancy certificate. A grace period of one year was given to the company in case of failure to provide the apartment on the aforementioned date. The company failed to comply with the terms and conditions by not giving the apartment on an earlier date. Hence, the appellants approached the NCDRC, praying for a refund of the amount they paid with a compound interest of @18% p.a., as well as compensation for the litigation costs and mental distress caused.

The respondent party is hereinafter referred to as the ‘OP’.

The NCDRC passed the following judgement:

The NCDRC directed the OP to give the entire physical possession of the property to the complainants within three months from the date this order was passed.

Both parties must inspect the property in question together, and in case of any deficiencies, the same must be reversed within 30 days of the inspection. The OP shall inform the complainants in writing after making the necessary changes and give them 15 days to complete the required formalities to be fulfilled to possess the property. The OP can also demand maintenance costs, such as car parking, club membership, etc., from the complainants. If the OP deems it necessary, it can take an indemnity bond from the complainants to pay taxes the authorities may likely demand in the future.

The OP shall bear compensation for delay in property transfer at simple interest 6% p.a. Parties are to bear their litigation costs. If the complainants wish to seek a refund, the OP shall be informed in writing within 15 days of the order. The OP shall refund the money after deducting the deposit amount within two months of the request made by the complainants.

APPELLANTS CONTENTIONS

The appellants contended that the respondent company did not comply with the contractual terms since they failed to offer the property for fit-outs on the time and date mentioned in the agreement. The possession of the apartment was to be delivered to the appellants on 30.06.2016 or extended by the grace period of one year.

RESPONDENT’S CONTENTIONS

The respondents contended that they had already obtained the occupancy certificate required before the expiry of the grace period. They informed the same to the appellants via email and asked them to make balance payments for the final property transfer. However, the appellants did not respond to the mail; hence, the respondent did not breach the contract. Additionally, they contended that the appellants wanted to terminate the contract due to the introduction of the Goods and Services Tax. They only want to avoid tax.

LEGAL PROVISIONS

Regulation 6(7) of the Development Control Regulations, 1991.

COURT ANALYSIS AND JUDGEMENT

The respondent company had obtained a ‘Part Occupancy Certificate’ from the Town & Country Planning Division of Mumbai instead of an Occupancy Certificate. The certificate was issued on the condition that the respondent company must finish the internal work before applying for a total occupancy certificate. The format was not in accordance with Regulation 6(7) of the Development Control Regulations, 1991. Moreover, the respondent company bypassed the date of offering the apartment for fit-outs. It directly offered possession of the apartment and could not even procure the full occupancy certificate, which cannot be overlooked as it is a severe breach of the terms of the contract. The appellants rightfully exercised their rights to terminate the contract and contended that they had not received any letter for the offer of property for fit-outs.

The NCDRC opined that the respondent company’s delay in issuing the flat was not unreasonable. But if the complainants still want to terminate the agreement and seek a refund, the respondent’s company shall return the amount they paid in full after reducing the deposit amount. Hence, it passed the aforementioned judgement. However, it cannot be contended that there was no delay in providing possession of the property since it can be deduced that the contract provided a full occupancy certificate. To this effect, the respondent party still has to issue an occupancy certificate.

The Supreme Court stated that when the parties enter into a contract outlining all the terms and conditions, they must abide by the same. If the contract provides for the actions to be taken in case of a breach, then such a method must be followed. If not, the complainants can legally enforce the same on the party at fault.

In the case of General Assurance Society Ltd. v. Chandumull Jain and another[1] relating to insurance documents, it was held that the court’s duty is limited to interpreting the documents rather than amending them. This changes the structure and substance of the contract; hereby, the court goes beyond its powers. Hence, however unreasonable the contract may be, it is not the court’s responsibility to make changes. The court must interpret the contract and apply the established terms and conditions. The same was reiterated in the case of Rajasthan State Industrial Development & Investment Corporation vs Diamond & Gem Development Corporation[2], Ltd. Shree Ambica Medical Stores vs Surat People’s Coop. Bank Ltd.[3] and GMR Warora Energy Ltd. vs Central Electricity Regulatory Commission[4].

The court said that the respondent company could not argue because the appellants accepted their proposal of delayed apartment delivery. The appellants were informed about the delay on two separate occasions. However, their response still demanded that the occupancy certificate be uploaded to the website to obtain a loan. The appellants were scheduled to see the property/apartment in question on 14.06.2017, which was delayed to August 2017 or later. It is unknown when the appellants were given the ‘part occupancy certificate’, but it is undisputed that after the expiry of the grace period, the appellants immediately sought to terminate the agreement by providing notice to the respondent company in writing. The appellants rightfully followed the terms and conditions of the contract. The respondents cannot infer the communication between the parties before the expiry of the grace period as a green signal by the appellants. It is not suggestive of their acceptance when they were not even aware of the full facts of the situation then. The fact that the appellants wanted to complete all the formalities to avoid the Goods and Services Tax is not grounds for them to be held against. The court observed that the urgency shown by the appellants due to the introduction of GST was justified and natural. Avoidance of tax does not amount to evasion of tax.

The respondent company relied on the case of Ireo Grace Realtech Pvt. Ltd. v. Abhishek Khanna[5] to pray for the reduction of interest rates. The court observed that the facts of this case do not apply to the current scenario. In this case, the contract provided that any delay after the expiry of the grace period shall allow the other party to terminate the contract and obtain a refund without any interest. Hence, in all fairness, the court ordered a refund with a 9% p.a. simple interest. In the instant matter, it has been explicitly laid down in the contract that an interest of 12% p.a. has to be paid along with the refund. Thus, the court does not hold the authority to amend the same.

The court further held that the National Consumer Dispute Redressal Commission (NCDRC) exceeded its power and authority. The court not only amended the terms and conditions of the contract but also set out the discourse to be taken by both parties, especially the appellants. The appellant company wished to terminate the agreement despite the offer of possession made by the respondents on 29.07.2017. Accordingly, the court has directed the respondent company to refund the amount the appellants paid in twelve equal monthly instalments. Post-dated cheques and a simple interest of 12% p.a will be paid. The first instalment must be paid on the 5th of April and the remaining on the fifth of each month till it is fully repaid.

CONCLUSION

In this judgement, the court reversed the NCDRC’s order. This judgement is crucial for determining the duties and powers of the judges when dealing with contractual cases. The court referred to various judgements and reiterated that the court’s power is limited to understanding the contract and applying the terms and provisions to the facts presented. Even in cases wherein the contract is arbitrary, the court must not amend a valid contract. This judgment also serves as a reminder to the parties entering into contracts to carefully devise and review the terms and conditions of the contract since they cannot change the same unless expressly provided for in the contract. The parties must be aware that even the omission of a task mentioned in the contract shall lead to a breach enforceable by the aggrieved party.

Judgement analysis written by- Rashi Hora

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[1] AIR 1966 SC 1644

[2] (2013) 5 SCC 470

[3] (2020) 13 SCC 564

[4] (2023) 10 SCC 401

[5] 5 (2021) 3 SCC 241

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