My summary of some key decisions of the Hon’ble Supreme Court of India has been provided below.

Criminal law

Quashing order under Section 482 CrPC may be set aside for failure to consider material collected during investigation/inquiry and statements recorded by IO

In the case of Kaptan Singh v. State of Uttar Pradesh & Ors. the Supreme Court has discussed the scope and limits of the above powers, and accordingly quashed the High Court’s impugned order whereby criminal proceedings against the accused had been quashed under Section 482 of the CrPC. The Hon’ble Court reasoned principally that the High Court vide impugned order had entered into the merits of the allegations, failed to appreciate that there were very serious triable issues/allegations against the accused persons (matter for trial) and that the High Court “lost sight of crucial aspects which have emerged during the course of the investigation“.

Supreme Court of India

‘Failure to explain’ only an additional link to complete the chain of circumstance and suspicion cannot replace proof

In the case of Parubai v. State of Maharashtra the Supreme Court has given the appellant the benefit of doubt and overturned the conviction for murder under Section 300/302 of the Indian Penal Code 1860 (IPC) based on suspicion (and not proven guilt beyond reasonable doubt), and explained that failure to explain can only be held as an additional link to complete the chain of circumstance, but the other circumstances in the chain must also be established against the accused.

Arbitration

Non-signatory to agreement cannot object to foreign award enforcement, non-availability of “perversity” as a ground et al.

The Supreme Court in the case of Gemini Bay Transcription Pvt. Ltd. v. Integrated Sales Service Limited & Anr. has comprehensively discussed the provisions of the  Arbitration and Conciliation Act, 1996  (the Arbitration Act), in particular Section 48 dealing with Conditions for enforcement of foreign awards, holding that a non-signatory to the arbitration agreement cannot object to a foreign award being binding upon it under Section 48(1)(a) and that the provisions under Section 47 are merely procedural, with no burden of proof imposed that such non-signatory is bound to the foreign award.

Insolvency and Bankruptcy

Scope of “existence of a dispute” and limited scrutiny by NCLT under Section 8(2)(a) IBC — defending insolvency resolution by operational creditor

The Supreme Court in the case of Kay Bouvet Engineering Ltd. v. Overseas Infrastructure Alliance (India) Private Limited has explained the objective of Section 8(2)(a) of the IBC, explained the scope of the key statutory phrase “existence of a dispute” and the (limited) role of the Adjudicating Authority/NCLT when adjudicating the same.

CoC approval of resolution plan under CIRP — Limited adjudicatory/appellate jurisdiction and judicial review

Jurisdiction (limits) of the Adjudicating Authority (i.e. National Company Law Tribunal (NCLT)) under Section 31 (Approval of resolution plan) read with Section 30(2) of the Insolvency and Bankruptcy Code 2016 (IBC) for the purpose of Corporate Resolution Insolvency Process (CIRP) has been (re) explained by the Supreme Court in the case of Pratap Technocrats (P) Ltd. & Ors. v. Monitoring Committee of Reliance Infratel Limited & Anr., with the Hon’ble Court holding that the “commercial wisdom” of Committee of Creditors (CoC) is not justiciable and judicial review of CoC’s approval of resolution plan is available on limited grounds.

Income tax

Bona fide transactions (issue of debentures) of actual payment in discharge of interest liability not affected by Section 43B(d) of Income-tax Act

The Supreme Court in M.M. Aqua Technologies Ltd. v. Commissioner Of Income Tax, Delhi-III has found the High Court’s impugned judgment erroneous in concluding that ‘interest’, on the facts of the case, had been converted into a loan, being contrary to the finding on facts of the authorities below. Rather the question for determination was whether interest can be said to have been actually paid by the mode of issuing debentures. The Hon’ble Court ultimately upheld the taxpayer/assessee appeal by reasoning that debentures issued by the assessee were accepted by the financial institution in discharge of the debt on account of outstanding interest, and consequently extinguished the liability to pay interest i.e. “actually paid” for the purpose of Section 43B(d) of the Income-tax Act 1961.

Property law

Document satisfying Section 58(c) TPA is a “mortgage by conditional sale”; no recovery for “improvements” to enjoy usufruct of property mortgaged

In the case of Bhimrao Ramchandra Khalate (Deceased) through LRS. v. Nana Dinkar Yadav (Tanpura) & Anr. the Supreme Court has overturned the judgment and decree passed by the First Appellate Court and that of the High Court affirming the same, and decreed the suit for redemption in favour of the plaintiff-appellant. The Hon’ble Court has interpreted the intention of the parties and the subject document titled “conditional sale deed”, executed as security for the loan amount, as a mortgage deed effecting a mortgage by conditional sale (and not outright sale).

Code of Civil Procedure (CPC)

Plea of res judicata beyond Order 7 Rule 11 (d) scope if only statements in plaint to be perused

A plaint is to be rejected by the concerned Court vide Order VII Rule 11(d) of the Code of Civil Procedure 1908 (CPC) “the suit appears from the statement in the plaint to be barred by any law“. In the case of Srihari Hanumandas Totala v. Hemant Vithal Kamat & Ors. the Supreme Court has discussed the law on the above provisions and summarised the following guiding principles for deciding an application under Order VII Rule 11(d).

Litigation

Lack of bona fides and subsequent conduct proves willful disobedience of undertaking to Court and “contempt of court”

In the case of Suman Chadha & Anr. v. Central Bank of India the Supreme Court has upheld the High Court’s finding of guilt for contempt of court against the petitioners and explained the relevance of subsequent conduct against the contemnor, which may “throw light upon one important aspect namely whether it was just the inability of the party to honour the commitment or it was part of a larger design to hoodwink the court“.

*****

Author: Anand Chaudhuri | Advocate @Legalrisk | JD (UNSW) LL.B (CLC, Faculty of Law, University of Delhi) | Website: https://legalrisk.in/. | Email: [email protected]

Disclaimer: The contents of this article are for information purposes only and do not constitute an advice or a legal opinion and are personal views of the author. It is based upon relevant law and/or facts available at that point of time and prepared with due accuracy & reliability. Readers are requested to check and refer relevant provisions of statute, latest judicial pronouncements, circulars, clarifications etc before acting on the basis of the above write up.  The possibility of other views on the subject matter cannot be ruled out. By the use of the said information, you agree that Author / TaxGuru is not responsible or liable in any manner for the authenticity, accuracy, completeness, errors or any kind of omissions in this piece of information for any action taken thereof. This is not any kind of advertisement or solicitation of work by a professional.

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