#delhicourt Archives - Page 14 of 15

8 Aug

The Right to Do Business Is Subject to Reasonable Restrictions in the Interest of Public Welfare and Economic Balance: Delhi High Court

Blog #delhi, #delhicourt, #delhihighcourt, #indianrailway, #railway

Title: D.G. Raj Commercial Pvt. Ltd. and Anr. v. General Manager, Northern Railway and Ors.
Decided on: 1st August, 2023

+ W.P.(C) 7222/2019 & CM APPL. 30010/2019CORAM: HON’BLE THE CHIEF JUSTICE SATISH CHANDRA SHARMA HON’BLE MR. JUSTICE SANJEEV NARULA SHARMA

Introduction

The Delhi High Court has dismissed a petition challenging a tender floated by the Northern Railway. The court refused to agree with the petitioners’ claim that their right to conduct business under Article 19(1)(g) of the Constitution of India was being violated by the tender. The court held that the right to conduct business is subject to reasonable restrictions in the interest of public welfare and economic balance.

Facts

The petitioners had a long-standing association with the Northern Railways and had entered into contracts for leasing parcel vans for train operations. They raised concerns when the Northern Railways issued a tender for leasing similar parcel cargo express trains to another destination, potentially impacting their business. The petitioners requested the withdrawal of the tender but were not successful. They approached the High Court seeking relief.

Advocate Manish Kohli represented the petitioners, while CGSC Arunima Dwivedi appeared for the respondent.

Analysis

The Delhi High Court observed that the right to conduct business is not an absolute right and can be subject to reasonable restrictions. The court noted that the Northern Railways’ decision to introduce new trains was aimed at enhancing railway services and meeting public needs. The court emphasized that measures to improve railway operations should not be hindered by speculative concerns about their impact on the petitioners’ business.

The court also examined the petitioners’ locus standi to challenge the tender. It noted that the petitioners had willingly participated in the tender process and had even secured the bid but failed to complete the necessary formalities. The court stated that opportunistic litigation undermines the fairness of the tendering process and creates unpredictability.

The court also considered the terms of the existing agreement between the parties and found that the petitioners did not possess exclusive rights for the train route in question, making their claim less tenable.

Held

The Delhi High Court dismissed the petition and imposed a cost of Rs. 50,000 on the petitioners to be deposited in the Delhi Police Welfare Fund. The court held that the petitioners had gained an unfair advantage by securing an interim stay on the tender, depriving the respondent of potential financial benefits. The court clarified that their attempt to prevent Northern Railways from issuing tenders for the relevant routes throughout the agreement’s duration was not justified.

In conclusion, the court dismissed the petition, emphasizing that the right to conduct business must be balanced with the broader interests of public welfare and efficient functioning of essential services like the railway system.

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Written by- Ankit Kaushik

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8 Aug

The Delhi High Court objects to the use of printed forms for matrimonial settlement agreements and directs mediation centres and family courts to ensure proper drafting.

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Blog #delhi, #delhicourt, #delhihighcourt, #dismissed

Title: Vivek Kumar & Ors. v. State & Anr.
Decided on: 27th July, 2023

+ CRL.M.C. 5205/2023

CORAM: HON’BLE MR. JUSTICE DINESH KUMAR SHARMA

Introduction

The Delhi High Court has issued a directive regarding the drafting of matrimonial settlement deeds, emphasizing that they should not be on printed proforma. In a case related to a matrimonial dispute, the court expressed its concern about settlement agreements being mechanically drafted on printed forms and directed Mediation Centres and Family Courts to ensure proper drafting of settlement deeds.

Facts

The case pertains to a petition filed under Section 482 of the Cr.PC seeking the quashing of a case registered under Sections 498A/406/34 IPC and Section 4 of the Dowry Prohibition Act. The petitioner and respondent got married in 2015, but differences and disputes led to their separation. An FIR was filed by the wife, and during the proceedings, the parties entered into an amicable settlement through a deed. The divorce was granted, and the husband made a payment of Rs. 2,50,000/- as per the settlement terms.

Advocates Sanjeev Kumar, Wahid Ali, and Ram Kamal Prasad represented the petitioners, while APP Digam Singh Dagar and Advocate Aman Srivastava appeared for the respondents.

Analysis

Justice Dinesh Kumar Sharma, in the context of dealing with matrimonial disputes, expressed dissatisfaction with the common practice of drafting settlement agreements using printed proforma. The court believed that such proforma-based drafting lacked proper application of mind and conveyed a sense of mechanical processing. In line with this, the court directed Mediation Centres and Family Courts to ensure that settlement deeds are not drafted on printed proforma and should reflect proper consideration.

Held

The High Court observed that the parties had entered into an amicable settlement without any force, fear, or coercion, thereby deciding to conclude the proceedings and move forward with their lives. Considering the voluntary settlement and the divorce decree already granted, the court found no purpose in continuing the trial.

The court emphasized the need for settlement deeds to adhere to the judgment in the case of Ganesh vs. Sudhirkumar Shrivastava (2020) 20 SCC 787, which sets standards for drafting settlement deeds. The court directed the circulation of its judgment to all Mediation Centres and Family Courts, urging them to draft settlement deeds that demonstrate proper application of mind and alignment with the mentioned legal precedent.

Consequently, the Delhi High Court disposed of the petition.

Written by- Ankit Kaushik

Click here to to view Judgement

7 Aug

IT Act| AO’s Attempt To Get Reopening Assessment Approved Is Just Rubber-Stamped: Delhi High Court

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Blog #delhi, #delhicourt, #delhihighcourt, #HighCourt, #itact

Title: Manujendra Shah v. Commissioner of Income Tax and Anr.
Decided on: 18th July, 2023

+ W.P.(C) 12677/2018

CORAM:HON’BLE MR. JUSTICE RAJIV SHAKDHER HON’BLE & MR. JUSTICE GIRISH KATHPALIA

Introduction

The Delhi High Court quashed a reassessment notice issued under the Income Tax Act, ruling that the proceedings were initiated without proper application of mind. The reassessment was based on the incorrect invocation of Section 50C of the Income Tax Act and the erroneous determination of the market value of the land as on April 1, 1981, for the computation of capital gain. The Court found that the Assessing Officer (AO) and the Principal Commissioner of Income Tax (PCIT) failed to properly consider the relevant provisions and materials before reopening the assessment.

Facts

The Assessee, an individual, filed a return of income for the Assessment Year (AY) 2011-12, disclosing long-term capital gain (LTCG) of Rs. 1.47 crore from the sale of six parcels of land. The Assessee declared the full value of consideration (FVC) as Rs. 20.26 crore and the cost of acquisition (COA) as Rs. 17.77 crore, claiming an exemption of Rs. 1 crore under Section 54EC.

The Revenue initiated reassessment proceedings, alleging non-disclosure of the actual FVC of Rs. 5.32 crore, which was below the circle rate specified by the stamp valuation authority. They also invoked Section 50C and questioned the COA of Rs. 17.77 crore, claiming an escapement of income amounting to Rs. 18.56 crore.

The Assessee approached the High Court, contending that the AO did not possess relevant material before initiating the reassessment proceedings.

Analysis

The Delhi High Court observed that Section 50C clearly stipulates that the FVC should be taken as the circle rate fixed by the stamp valuation authority while calculating capital gain under Section 48 of the Act. In this case, there was no dispute that the Assessee had already calculated capital gains based on the circle rate of Rs. 20.26 crore. Hence, the invocation of Section 50C was inapplicable as the capital gain was already computed using the circle rate.

The significant difference in LTCG between the AO and the Assessee was due to the difference in the COA. The AO based the COA on inputs claimed by the DCIT (Central Circle), Dehradun, using a rate of Rs. 8 per square meter, while it was claimed that Rs. 10 per square meter should have been used.

The High Court noted that the AO failed to apply his mind to the inputs from DCIT (Central Circle) and did not provide any reason for adopting the rate of Rs. 8 per square meter instead of Rs. 10 per square meter for calculating COA.

Held

The Delhi High Court held that there was complete non-application of mind by the AO, both in the applicability of Section 50C and in failing to secure the relevant material from DCIT, Dehradun, for determining the market value of the land as on April 1, 1981, which forms the basis of COA. Consequently, the reassessment proceedings were quashed.

Written by- Ankit Kaushik

Click here to view Judgement

4 Aug

Government Must Ensure Implementation Of Delhi Online Registration System For Document Preservation : Delhi High Court

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Blog #delhi, #delhicourt, #delhihighcourt, #digital, #online, #Registration

Title: Monk Estates Private Limited & Anr. v. Government of NCT of Delhi & Ors.
Decided on: 27th July, 2023

+ W.P. (C) 254/2023

CORAM: HON’BLE MRS. JUSTICE PRATHIBA M. SINGH

Introduction:

The Delhi High Court recently addressed a matter concerning missing documents from the Sub-Registrar’s office in Delhi and directed the Delhi Government to ensure the implementation of the Delhi Online Registration System (DORIS) for document preservation. The Court expressed serious concerns about the missing records and emphasized the need for an effective system to preserve documents.

Facts

In January 2023, a petition was filed seeking an inquiry into missing records from the Sub-Registrar-III’s office in Delhi related to the execution and registration of lands owned by Monk Estates Pvt. Ltd. An FIR was registered in 2019 after a significant delay of 14 years. The Court raised serious concerns about the missing records and directed authorities to conduct a thorough investigation into the matter.

In February 2023, the concerned Sub-Registrar filed a status report stating that only a Lost Report had been registered in 2019, but no further investigation was conducted. The Court also sought detailed information about the DORIS system used for document registration and directed the Principal Secretary (Revenue) to ensure its effective implementation in all Sub-Registrar offices.

Analysis

The Court expressed doubts about the full implementation of the DORIS system despite its design. It noted that there was a need to ensure the availability of necessary systems and cloud service in all Sub-Registrar’s offices to prevent a situation like the present case, where important documents were missing, from recurring.

Held

The Delhi High Court directed the Delhi Government to continue the investigation into the missing records and register an FIR if necessary. It further instructed the GNCTD to ensure that the necessary systems and cloud service are made available to all Sub-Registrar’s offices for proper document preservation. The Court held that the Principal Secretary (Revenue), GNCTD, shall be personally responsible for ensuring the effective implementation of the DORIS system. With these directions, the Court disposed of the petition.

Written by- Ankit Kaushik

Click here to view judgement

3 Aug

The arbitral award against Spicejet in favour of the company’s former promoter, Kalanithi Maran, is upheld by the Delhi High Court.

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Blog #airlines, #arbitration, #delhi, #delhicourt, #delhihighcourt, #Spicejet

Title: SpiceJet Limited v. Kal Airways Pvt Ltd & Ors.
Decided on: 31^st July, 2023

+ O.M.P. (COMM) 42/2019 & I.A. 1281/2019CORAM: HON’BLE MR. JUSTICE CHANDRA DHARI SINGH

Introduction

The Delhi High Court recently dealt with two appeals challenging an arbitral award dated July 20, 2018, which directed SpiceJet’s Promoter and Chairman Ajay Singh to refund Rs. 308 crore towards warrants and Rs. 270 crore towards cumulative redeemable preference shares (CRPS) along with interest to Kal Airways and Kalanithi Maran. The Court also considered Maran’s appeal for damages of Rs. 1,323 crore from SpiceJet. The case revolved around the interpretation of the arbitration agreement and whether the arbitral award suffered from patent illegality or was against public policy.

Facts

The disputes between the parties arose concerning an Agreement concerning their financial obligations. The respondents invoked the arbitration clause stipulated in the Agreement for resolution. The petitioners argued that the entire amount of Rs. 370 crores, meant to be brought into their company as committed support, was to remain with the airline for eight years as per the Agreement’s terms. They contended that the Arbitral Tribunal had no authority to rewrite the contract by ordering the return of Rs. 270 crores and altering the transaction’s nature.

Analysis

The Delhi High Court, while considering the limited grounds under Section 34 of the Arbitration and Conciliation Act, 1996, to challenge an arbitral award, refused to interfere with the award. The Court emphasized that it could only intervene if there was an error apparent on the face of the record or if the award suffered from patent illegality or was against public policy. The Court examined the findings of the Arbitral Tribunal and concluded that there was no gross illegality or perversity in the award. It held that the conclusions drawn by the Tribunal did not shock the conscience of the Court.

The Court’s analysis highlighted the importance of clear and precise decisions by arbitrators to withstand judicial review. It underscored the principle of minimal judicial interference in arbitral awards, respecting the autonomy and finality of arbitration proceedings.

Held

The Delhi High Court dismissed the appeals challenging the arbitral award and upheld its validity. The Court found no grounds to set aside the award, as it was not patently illegal, against public policy, or fundamentally flawed. The conclusions drawn by the Arbitral Tribunal were deemed acceptable and did not warrant interference by the Court. As a result, the award directing the refund of amounts and interest to Kal Airways and Kalanithi Maran was upheld, while rejecting Maran’s appeal seeking additional damages from SpiceJet.

Written by- Ankit Kaushik

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