DIRECT TAXES

Allied Laws

Ajay R. Singh, Advocate

1. Compensation in Motor Accident

Motor Accident claims Tribunal while determining quantum of compensation payable in a road accident case must consider not only the pay packet an employee carries home at the end of the month but also other perks which are beneficial to the members of the entire family.

Gulab alias Sangeeta & Ors vs. Shri N. Moiden Kunti, Shri N. Moosa & National Insurance Co. Ltd. (2009) Vol. 111 (4) Bom. L.R. 1388

2. Construction of Agreement – Transfer of property – S. 8

A document must be read in its entirety. When character of a document is in question, although the heading, thereof would not be conclusive however it plays a significant role. Intention of the parties must be gathered from the document itself but therefore circumstances attending thereof would also be relevant. It is essential that all parts of the deed should be read in their entirety.

C. Cheriathan vs. P. Narayanan Embranthiri AIR 2009 SC 1502.

3. Contract Act – S. 23

Contracts void where consideration is unreasonable/against public policy. Bank charging additional interest for prepayment of loan is not hit by section 23 of the Contract Act.

Mahavir Ice & Cold Storage P. Ltd. vs. Small Industries Development Bank of India AIR 2009 (NOC) 1218 (Ori.)

4. Conveyance – Stamp Act

Scheme of arrangement, sanctioned by Court involving transfer of business of going concern is an instrument and a conveyance within the meaning of Article 23(b) of Schedule 1-B as applicable to State of U.P.

M/s. Hero Motors Ltd vs. State of UP AIR 2009 Allahabad 93

5. Copyright

“Literary work” includes computer programme and compilation including computer data bases.

Bharat Matrimony.com P. Ltd. vs. People Interactive P. Ltd. AIR 2009 Mad 78

6. Effect of Repeal of an Act – S. 6 of General Clauses Act – Patents Act, 1970

The petitioners challenging rejection of their application for grant of EMRs (Exclusive Marketing Rights) prior to the Amending Act (w.e.f 1st January, 2005). The Amending Act (w.e.f. 1st January, 2005) abolishing EMRs. Held that section 6 of the General Clauses Act saved the application for EMRs which was filed much prior to the coming into force of the Amending Act of 2005. When a pre-existing right of appeal continues to exist, by necessary implication the old law which created the right of appeal also exists to support the continuation of that right and hence the old right must govern the exercise and enforcement of that right. In the absence of contrary intention in repealing the enactment, rights under the old statute are not destroyed.

Glaxo Smithkline Plc. vs. Controller of Patents & Designs AIR 2009 SC 1147

7. Election

Law prohibits any person who has been convicted of any offence and sentenced to imprisonment for not less than two years from contesting the election and such person shall be disqualified for a further period of six years since his release.

Sanjay Dutt vs. State of Maharashtra through CBI, Bom (2009) Vol. 111 Bom. LR 2116

8. FERA – PENALTY

When the proprietorship concern is found guilty and penalty is imposed on it, that penalty should be presumed to have been imposed on its proprietor and, therefore, no separate penalty could be imposed on the proprietor:

Ashok Chopra vs. Union of India & Ors. (2009) Vol. (111) Bom. LR 2215

9. Hindu Law – Hindu Succession Act – Amendment by the Act of 2005

Daughter to be treated as coparcener even though the amendment came into force during the pendency of the Second Appeal by the son against order dismissing partition suit filed by him.

Mangilal vs. Saligram & Ors. AIR 2009 (NOC) 1273 (MP)

10. Hindu Law – Joint Hindu Family

Male head of family died leaving behind his widow and four daughters – Family would continue to constitute a ‘Joint Hindu Family’ – Widowed mother would not have to seek permission of a competent court to alienate joint family property, during the minority of her daughters. However, alienation of immovable property of a minor, though permissible, can be questioned in suit for partition on the ground of whether or not there was a legal necessity.

Smt. Bhagyamma & Ors. vs. Smt. Ningamma & Anr. AIR 2009 (NOC) 1272 (Kar.)

11. Hindu Law – Widow inheriting property of her deceased husband

Becomes absolute owner on the death of her husband and her subsequent re-marriage would not divest her of the property – she inherits the share of her deceased husband in the joint family property – Her father-in-law died after her re-marriage – His share would be inherited by er brother-in-law.

Balitram Dhake vs. Rahubai Saraswatibai AIR 2009 Bom 57

12. Hindu Succession Act – Husband, wife and minor son dying simultaneously in an accident

By virtue of section 21 of the Hindu Succession Act, when two persons died in circumstances rendering it uncertain to decide as to which one would have survived the other, it is presumed that the younger survived the other. The younger i.e. the son (who is presumed to have survived) having no Class-I tier, his maternal grand mother (being Class-II tier) would be legal representative of the deceased. The fact that the maternal grand mother had snapped all her ties with the deceased by publishing a notice in the newspaper would not disinherit statutory heir as the position would be governed by the statutory provision and such notice in the newspaper has no legal value.

Raman Khanna & Ors. vs. Sham Kishore Khanna AIR 2009 H.P. 42

13. Meaning

When a term or expression is neither defined under an Act or it is to be given a meaning as given in another Act then it should be given the meaning as understood in ordinary popular sense.

Neelam Narayan Bansode vs. State of Maharashtra & Ors. (2009) Vol. 111 Bom L.R. 1761

14. Negotiable Instruments Act - Cheque Bouncing – S. 138

Issuance of notice would not, by itself, give rise to cause of action but communication of notice would. There is a difference between giving of notice and service of notice. Only on service of such notice and failure on part of the accused to pay the demanded amount within 15 days thereafter, commission of an offence completes. Presumption raised in support of service of notice would depend upon the facts and circumstances of each case. Presumption has to be raised not in the hypothesis or surmises but if the foundational facts are laid down therefore. Only because presumption of service of notice is possible to be raised the same may not be a ground to hold that he distinction between giving of notice and service of notice ceases to exist.

Harman Electronics P. Ltd. vs. National Panasonic India Ltd. AIR 2009 SC 1168

15. Negotiable Instruments Act – S. 138

By virtue of sec. 139 a presumption is raised in favour of the complainant that there was a existing debt/liability for which the cheque was issued. However this presumption is rebuttable and the accused is not expected to rebut the statutory presumption by proving his defence beyond reasonable doubt. It is enough if the accused is able to establish that circumstances exist which enable a prudent man to suppose that no debt existed.

M/s. Kumar Exports vs. Sharma Carpets AIR 2009 SC 1518

16. Registration Act

Document of Sale unregistered and inadequately stamped. Not admissible in evidence even for collateral purposes.

Avinash Kumar vs. Vijay Krishna Mishra AIR 2009 SC 1489

17. Registration Act

Document in the nature of family settlement recognizing pre-existing right in property. Not compulsorily registrable.

Pullella Lakshminarayana vs. Maddimsetti Mukteshwara Rao AIR 2009 (NOC) 1672 (AP)

18. Stamp Act

Document whether Conveyance or Release Deed. Co-owners transferring their share to other co-owners who had a pre-existing right in the property would not amount to conveyance but would be release deed.

State of U.P. vs. Dharam Pal & Anr. AIR 2009 (NOC) 1372 (All)

Note : ‘NOC’ stands for ‘Notes on Cases’

19. Summons to produce document – Civil Procedure Code, order 16 – Rule 6

Request for summoning document cannot be rejected on ground that petitioner can very well obtain copy of document under Right to Information Act. In a Civil Suit, if a party applies for issuing summons for production of documents under Rule 6 of Order 16 of the CPC the same cannot be rejected by the Court without valid reason. The Right to Information Act does not in any way curtail powers of Civil Court under the CPC.

Eldhose vs. Yacob & Ors. AIR 2009 Kerala 104.

20. Tenancy – Bonafide requirement

Landlord of a property can maintain action for eviction of tenant from a property exclusively belonging to him on ground of bonafide requirement even if other properties are also co-owned by him.

Smt. Zeitumbi Habib Mohamad vs. Shri Thomas Roberto Gomes (2009) Vol. 111 Bom. L.R. 2108

21. Title of Film ‘Slumdog Millionaire’ held not offensive or defamatory

The title of the film has to be judged on the theme of the film and the manner in which it has been exhibited in the public view. In the said film a slum boy from slums of Mumbai highlighted

and depicted as Jewel who had risen to win a fortune.

The title ‘Slumdog Millionaire’ does not defy any public decency or morality and it is not aimed at slum dewellers in general and also not defamatory.

Meena Anil Jagtap, Executive Secretary, Dastak vs. T. Series Super Cassettes Ind. Ltd. AIR 2009 Gujarat 94

22. Validity of Agreement – Contract Act

– S. 10

All agreement of sale are bilateral contracts as promises are made by both the vender agreeing to sell and the purchaser agreeing to purchase. It cannot be said that unless agreement is signed both by the vender and purchaser it is not a valid contract. Even an oral agreement to sell is valid. A written agreement signed by one of the parties, if it evidences such an oral agreement will also be valid. In the event of breach by vender, it can be specifically enforced by the purchaser. Thus agreement of sale signed only by vender is valid and enforceable by purchaser.

Aloka Bose vs. Parmatma Devi & Ors. AIR 2009 SC 1527

23. Writ Remedy – Article 226 of the Constitution

Existence of an alternative remedy is not an absolute bar to exercise jurisdiction under Article 226. The High Court may exercise jurisdiction despite the fact that an alternative remedy is availability, where the alternative remedy is not an efficacious one. Furthermore where the lower Court/Authority has acted without jurisdiction, the High Court shall not refuse to exercise its jurisdiction.
Committee of Management & Anr. vs. Vice- Chancellor & Ors. AIR 2009 SC 1159

24. Writ Remedy – Article 226 of the Constitution

A petition filed under Article 226/227 can be treated as a petition under Article 226. Merely because a petition under Article 227 is maintainable against orders passed by Tribunal exercising judicial functions, it would not exclude the exercise of power by the High Court under Article 226. Jurisdiction under Article 226 is not affected by establishment of the Debt Recovery Tribunal under the Recovery of Debts due to Banks and Financial Institutions Act, 1993.

Bhowanipore Gujarati Education Society & Anr. vs. Kolkata Municipal Corporation & Ors. etc. AIR 2009 Cal 14 (FB)