Supreme Court

Smt. Meena Pawaia & Ors Vs. Ashraf Ali & Ors.

MANU/SC/1088/2021

18.11.2021

Motor Vehicles

Even if deceased was not earning at the time of death, his legal heirs are entitled to future prospects

The original claimants have preferred the present appeal against impugned judgment passed by the High Court, by which the High Court has partly allowed the said appeal preferred by the Union of India/Railways and has reduced the amount of compensation from Rs.12,85,000 (awarded by the claims tribunal) to Rs.6,10,000¬, the original claimants have preferred the present appeal.

While awarding the future economical loss, when the deceased died at the young age 21¬-22 years and was not earning at the time of death/accident, as per catena of decisions of this court, the income for the purpose of determining the future economic loss is always done on the basis of guesswork considering many circumstances namely the educational qualification and background of the family, etc. Therefore looking to the educational qualification and the family background and, the deceased was having a bright future studying in the 3rd year of civil engineering, present Court is of the opinion that, the income of the deceased at least ought to have been considered at least Rs.10,000¬ per month.

The next question which is posed for the consideration before present court is whether anything further is required to be added towards the future rise in income? It is submitted that as the deceased was not serving and earning at the time of accident/death nothing further is to be added towards the future prospect/future rise in income.

In case of a deceased, who was not earning and/or not doing any job and/or self employed at the time of accident/death, his income is to be determined on the guesswork looking to the circumstances. Once such an amount is arrived at, he shall be entitled to the addition over the future prospect/future rise in income. It cannot be disputed that, the rise in cost of living would also affect such a person.

As observed by this court in the case of National Insurance Company Limited vs. Pranay Sethi and Others, the determination of income while computing compensation has to include future prospects so that the method will come within the ambit and sweep of just compensation as postulated under Section 168 of the Motor Vehicles Act. It is not expected that the deceased who was not serving at all, his income is likely to remain static and his income would remain stagnant.

Even in case of a deceased who was not serving at the time of death and had no income at the time of death, their legal heirs shall also be entitled to future prospects by adding future rise in income as held by this court in the case of Pranay Sethi i.e. addition of 40% of the income determined on guesswork considering the educational qualification, family background etc., where the deceased was below the age of 40 years.

In the present case, the claimants shall be entitled to future economic loss at Rs.14,000¬ per month. The deceased at the time of accident was aged between 21-¬22 years. Therefore, the multiplier has to be adopted/applied considering the age of the deceased and not the age of the parents thus, multiplier 18 would apply. Therefore, the claimants shall be entitled to Rs.15,12,000 towards the future economic loss. Claimants shall also be entitled to Rs.15,000¬ towards loss of estate, Rs.15,000/ towards funeral expenses and Rs.40,000¬ towards loss of love and affection. Thus, the claimants shall be entitled in all a sum of Rs.15,82,000 with interest thereon at the rate of 7% per annum from the date of claims petition till realization.

Impugned judgment and order passed by the High Court is modified and it is held that the claimants shall be entitled a total sum of Rs.15,82,000¬ with interest thereon at the rate of 7% from the date of claims petition till the date of realization. Present appeal is partly allowed.

Tags : Compensation Reduction Legality

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Supreme Court

The State of Madhya Pradesh and Ors. vs. Ashish Awasthi and Ors.

MANU/SC/1090/2021

18.11.2021

Service

For appointment on Compassionate ground, policy prevalent at the time of employee's death applies and not the subsequent one

The State of Madhya Pradesh has preferred the present appeal feeling aggrieved with the impugned judgment passed by the he High Court by which the Division Bench of the High Court has allowed the said appeal and has quashed and set aside the judgment passed by the learned Single Judge of the High Court and has directed that the Appellants herein – original Respondents to consider the claim of the Respondent for a compassionate appointment.

The deceased employee died on 8th October, 2015. At the time of death, he was working as a work charge employee, who was paid the salary from the contingency fund. As per the policy/circular prevalent at the time of the death of the deceased employee, i.e., policy/circular No.C-3- 12/2013/1-3 dated 29.09.2014 in case of death of the employee working on work charge, his dependents/heirs were not entitled to the appointment on compassionate ground and were entitled to Rs. 2 lakhs as compensatory amount. Subsequently, the policy came to be amended vide circular dated 31th August, 2016, under which even in the case of death of the work charge employee, his heirs/dependents will be entitled to the appointment on compassionate ground.

Relying upon the subsequent circular/policy dated 31.08.2016, the Division Bench of the High Court has directed the appellants to consider the case of the respondent for appointment on compassionate ground. As per the settled preposition of law laid down by this Court for appointment on compassionate ground, the policy prevalent at the time of death of the deceased employee only is required to be considered and not the subsequent policy.

In the case of Indian Bank and Ors. Vs. Promila and Anr., it is observed and held that claim for compassionate appointment must be decided only on the basis of relevant scheme prevalent on date of demise of the employee and subsequent scheme cannot be looked into. Similar view has been taken by this Court in the case of State of Madhya Pradesh and Ors. Vs. Amit Shrivas. It is required to be noted that in the case of Amit Shrivas, the very scheme applicable in the present case was under consideration and it was held that the scheme prevalent on the date of death of the deceased employee is only to be considered. In that view of the matter, the impugned judgment and order passed by the Division Bench is unsustainable and deserves to be quashed and set aside.

Once the judgment and order passed by the Division bench under which Respondent is appointed is quashed and set aside, necessary consequences shall follow and the appointment of the Respondent, which was pursuant to the impugned judgment and order passed by the Division Bench of the High Court cannot be protected.

The impugned judgment and order passed by the Division Bench of the High Court is quashed and set aside by observing that, the Respondent shall not be entitled for appointment on compassionate ground on the basis of the subsequent circular/policy dated 31st August, 2016. The impugned judgment and order passed by the High Court is hereby quashed and set aside. Appeal allowed.

Tags : Appointment Direction Legality

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Supreme Court

Acqua Borewell Pvt. Ltd. vs. Swayam Prabha and Ors.

MANU/SC/1074/2021

17.11.2021

Civil

Injunction orders cannot be passed against third parties without hearing them

Feeling aggrieved and dissatisfied with the impugned common judgment passed by the High Court, by which the High Court has allowed the aforesaid appeals in part and has modified the interim injunction granted by the ‘trial Court’ and restricted the injunction against alienation to the extent of 1/7th share in the total plaint schedule properties till the disposal of the case, the third parties have preferred the present appeals.

Before granting any injunction with respect to the properties in which the Appellants herein (proposed Defendants) are claiming right, title or interest on the basis of the development agreements or otherwise, they ought to have been given an opportunity of being heard. No injunction could have been granted against them without impleading them as Defendants and thereafter without giving them an opportunity of being heard.

It is required to be noted that, the learned trial Court dismissed the injunction application and refused injunction by observing that, some of the properties are evidently owned by the firms/trusts/companies which have not been made parties to the suit. Therefore, the impugned common judgment and order passed by the High Court granting injunction with respect to 1/7th share in the total plaint schedule properties which has been passed without giving an opportunity of being heard to the Appellants and without impleading them as party- defendants in the suit by the learned trial Court, is unsustainable and deserves to be quashed and set aside. The impugned common judgment and order passed by the High Court granting injunction against alienation to the extent of 1/7th share in the total plaint schedule properties is hereby quashed and set aside. The present appeals are allowed.

Tags : Injunction third party hearing

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High Court of Delhi

Renewable Energy Systems Limited Vs. Bharat Sanchar Nigam Limited

MANU/DE/3083/2021

16.11.2021

Arbitration

Statute of limitation extinguishes recourse to the remedy and not the debt

The Petitioner has filed the present petition under Section 34 of the Arbitration and Conciliation Act, 1996 ('A&C Act') challenging the Arbitral Award. In terms of the impugned award, the claims made by the Petitioner were rejected as barred by limitation. The Petitioner claims that, the said view is ex facie erroneous and the impugned award is vitiated by patent illegality on the face of the record. The principal controversy involved in the present case is whether the claims made by the Petitioner were barred by limitation.

The Lease Agreement was essentially in the nature of a financing lease. The Petitioner had agreed to supply the SPPS at an agreed invoice value. The QLRs were based on the said invoice value and also linked with the SBI prime lending rate. In terms of Clause 12.8 of the Lease Agreement, it was agreed that the Respondent would pay a transfer sale price at the rate of 1% of the invoice value.

The Lease Agreement was for a fixed term of five years and it was agreed that the QLRs would be paid within seven days at the end of each quarter. In this view, it is indisputable that, any failure on the part of the Respondent to pay the QLRs would give rise to a cause of action at the end of seven days from the end of each quarter. Insofar as the Petitioner's claim for the transfer sale price is concerned, the cause of action for recovering the same arose at the end of the term of the lease. Thus, ex facie, the claims made by the Petitioner are barred by limitation.

The Petitioner's claim is for a quantified amount, which according to the Petitioner was due and payable during the term of the Lease Agreement and latest, by the end of the Lease Agreement. The Petitioner had also claimed interest for the said period. The contention that since the amounts remained outstanding, the Petitioner's cause of action continued is, plainly, unsustainable. The fact that a debt has remained outstanding, does not extend the period of limitation. It is established that the statute of limitation extinguishes recourse to the remedy and not the debt.

The contention that the Petitioner had repeatedly sent reminders to the Respondent for making the said payment would not in any manner extend the period of limitation. The claims made by the Petitioner are, ex facie, barred by limitation. Further, the Petitioner has not placed on record any document issued by the Respondent within the period of limitation, acknowledging the debt claimed by the Petitioner. Petition dismissed.

Tags : Debt Limitation Extension

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High Court of Delhi

Mohan Kumar Jha and Ors. Vs. State of NCT of Delhi

MANU/DE/3075/2021

16.11.2021

Criminal

Magnitude of the offence cannot be the only criterion for denying bail

Present petitions under Section 439 of Code of Criminal Procedure, 1973 (CrPC) have been filed for grant of bail to the petitioners in FIR registered at Police Station for the offences punishable under Sections 420/188/120B/34 of Indian Penal Code, 1860 (IPC) and Sections 3/7 of the Essential Commodities Act, 1955 and Section 3 of the Epidemic Disease Act, 1897. All the said petitions have a common prayer, i.e. to enlarge the accused persons on regular bail.

Charge-sheet has been filed. The evidence, which is primarily documentary in nature, has been collected and is already in the custody of Police. The exhibits have been sent for sampling and for verification. The Petitioners are accused of offences punishable under Sections 420/468/471/188/120B/34 of IPC and Sections 3/7 of the Essential Commodities Act and Section 3 of the Epidemic Disease Act and if convicted the Petitioners can be sentenced for imprisonment for a maximum period of seven years. The Petitioners have already spent seven months in custody. Though the Petitioners are accused of a nefarious and depraved offence, taking into account the fact that the evidence which is primarily documentary in nature and is already in the custody of Police, this Court is of the opinion that no useful purpose would be served in prolonging the incarceration of the Petitioners.

It is settled law that, the magnitude of the offence cannot be the only criterion for denying bail. The object of bail is to secure the presence of the accused at the Trial. The object of bail is neither punitive nor preventative and the person who has not been convicted should be held in custody pending Trial only to ensure his attendance at Trial; and to ensure that the evidence is not tampered with and the witnesses are not threatened. If there is no apprehension of interference in administration of justice in a criminal trial by an accused then a person should not be deprived of his liberty. Accordingly, this Court is inclined to grant bail to the petitioners on the conditions. Petitions are disposed of.

Tags : Bail Grant Conditions

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Customs, Excise and Service Tax Appellate Tribunal

Prabhu Shipping Systems Vs. Commissioner of Customs, Thoothukudi

MANU/CC/0155/2021

15.11.2021

Customs

Mere act of removing employee after an incident does not extinguish vicarious liability on employer

The Appellant, a licensed Customs Broker, is aggrieved by the Order-in-Original passed by the Commissioner of Customs, holding that, the Appellant had contravened Regulations 10(b), 10(d), 10(k), 10(n) and 13(12) of the Customs Brokers Licensing Regulations, 2018 (CBLR)and revoking the Appellant's licence under Regulation 14 read with Regulation 17. The security deposit furnished by the Appellant was also forfeited and a penalty of Rs. 50,000 was also imposed upon the Appellant under Regulation 18 of CBLR, 2018.

The CBLR, 2018 places several responsibilities upon the Customs Broker. The Customs Broker assumes a very important role in the processing of imports and exports of goods and related documentation under the Customs Act and acts as a pivot in the operation of Customs House in supervision of imports and exports. For this reason, the license is not given to anyone and everyone but is given only after conducting an examination to verify its knowledge of the customs procedures and checking its credentials. Thereafter, the Customs Broker is expected to act responsibly. It is true that, the Customs Broker may not have the knowledge of any mis-declaration of the quantity, nature and value of the goods by the importer/exporter. However, the Customs Broker has to fulfill its obligations laid down in Regulation 10.

The Customs Broker licensed in one Customs House is also permitted to operate in other Customs Houses. However, all such operations must be directly done by Customs Broker himself or by its employees. For the acts and omissions of its employees, the customs broker is liable and this vicarious liability is explicitly indicated in Regulation 13. In this case, the Appellant chose to operate from Chennai and Mumbai and has appointed Mr. Kadam, G Card holder giving him the Power of attorney. Therefore, for any act or omission of employee, the Appellant is responsible and the mere act of removing its employee after an incident does not extinguish this vicarious liability.

In present case, the carting was done by a person who is neither a licensed customs broker nor is an employee of the appellant or is the exporter or the employee of the Customs Broker. This is a violation of Regulation 10(b).

Regulation 10(d) mandates the Customs Broker to advise his client to comply with the provisions of the Act, other allied Acts and the rules and regulations thereof, and in case of non-compliance, to bring the matter to the notice of the Deputy Commissioner of Customs or Assistant Commissioner of Customs, as the case may be. The finding in the impugned order is that, the Appellant has not even seen the goods which were being exported and was not aware of the price of the goods being exported. We do not find anything in the CBLR, 2018 which requires the Customs Broker to assess or know the correct value of the goods being exported. There is nothing to show that the Appellant was aware of the violations by the exporter and has not brought them to the notice of the Assistant Commissioner/Deputy Commissioner. Thus, there is no ground to hold that, the Appellant has violated the Regulation 10(d).

Further, as the Appellant has not till date produced any documents to show that, it had obtained the KYC documents, the Appellant has not maintained its records and thereby violated Regulation 10(k). Regulation 13 mandates the Customs Broker shall exercise such supervision as may be necessary to ensure proper conduct of his employees in the transaction of business and he shall be held responsible for all acts or omissions of his employees during their employment. Therefore, for the acts and omissions of employee, the Appellant is responsible. There is no reason to interfere with the impugned order except to the extent it records that the Appellant has violated Regulation 10(d). Accordingly, the impugned order is upheld. The appeal is rejected.

Tags : Regulation Contravention Penalty

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Supreme Court

Punjab State Civil Supplies Corporation Ltd. and Ors. vs. Ramesh Kumar and Company and Ors.

MANU/SC/1066/2021

13.11.2021

Arbitration

While considering a petition under Section 34 of the Arbitration Act, the Court cannot act as an appellate forum

The appeal arises from a judgment of a Single Judge of the High Court. High Court not only set aside the judgment of the District Judge rejecting the petition under Section 34 of the Arbitration and Conciliation Act, 1996 (1996 Act), but also awarded the claim of the Respondents, together with interest.

The Appellants, submits that the High Court, while exercising its jurisdiction under Section 37 of the 1996 Act, arising from the rejection of an arbitration petition under Section 34 of 1996 Act, has transgressed the limits of the jurisdiction. The High Court was not exercising its jurisdiction as a first appellate court in a civil suit and could not have awarded the claim.

The Single Judge of the High Court was exercising jurisdiction under Section 37 of the 1996 Act. The award of the sole arbitrator contains an analysis of the evidence. Both the Respondents as well as the Appellants adduced evidence before the arbitral tribunal. It was on the basis of the evidence that, the sole arbitrator upheld the defence of the Appellants on the ground that, right from the inception the Respondents had been mixing sub-standard material with goods in accordance with the tender specifications. As a consequence of this, the loss and damage which has been caused to the Appellants was duly quantified and in this backdrop, the sole arbitrator held that, the Respondents were not entitled to the payment of the balance of the principal or to recover the security deposit.

While considering a petition under Section 34 of the 1996 Act, it is well-settled that the court does not act as an appellate forum. The grounds on which interference with an arbitral award is contemplated are structured by the provisions of Section 34 of 1996 Act. The District Judge had correctly come to the conclusion that, there was no warrant for interference with the arbitral award under Section 34 of 1996 Act The High Court seems to have proceeded as if it was exercising jurisdiction in a regular first appeal from a decree in a civil suit. The jurisdiction in a first appeal arising out of a decree in a civil suit is distinct from the jurisdiction of the High Court under Section 37 of the 1996 Act arising from the disposal of a petition challenging an arbitral award under Section 34 of the 1996 Act.

In the present case, the High Court was required to determine as to whether the District Judge had acted contrary to the provisions of Section 34 of the 1996 Act in rejecting the challenge to the arbitral award. Apart from its failure to do so, the High Court went one step further while reversing the judgment of the District Judge in decreeing the claim in its entirety. This exercise was clearly impermissible. There was no basis in law for the High Court to interfere with the judgment of the District Judge and, to even go a step further by decreeing the claim. The judgment of the High Court is unsustainable. Appeal allowed.

Tags : Award Jurisdiction Validity

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