Wednesday, 25 July 2012

Latest Judicial Case

Vinod Kumar Koul Vs. State of J&K and others - Jul 16 2012 (SC)

Constitution of India - Articles 14 and 16
of COI

The appellant applied for the post of Laboratory Assistant, which was a District cadre post. He appeared before the Selection Committee but was not interviewed on the ground that he was not a permanent resident of District Udhampur. The appellant challenged the decision of the Selection Committee not to consider his candidature on the ground of violation of Articles 14 and 16 of the Constitution. The appellant pleaded that he was qualified for the post and fulfilled other conditions. By an interim order the learned Single Judge of the High Court directed the Selection Committee to interview the appellant but made it clear that his result should not be declared without the Court’s order. The Board contended the writ petition mainly on the ground that the appellant was not a permanent resident of District Udhampur and an unambiguous permanent residence certificate issued by the competent revenue authorities of the district could be accepted. After considering the arguments of the counsel for the parties, the learned Single Judge dismissed the writ petition on the premise that the selection was to be made only from the candidates being a permanent resident of District Anantnag, and therefore was not entitled to be considered for appointment in District Udhampur. The Division Bench of the High Court agreed with the learned Single Judge. Rule 13(i) laid down the procedure of selection by the Recruitment Board. It stated that in the absence of any statutory stipulation in that regard, it could not be said that a candidate who was a permanent resident of the State of Jammu and Kashmir was not eligible to be considered for a District cadre post just because he was not a permanent resident of the particular District for which the post was advertised. It was held that the administrative decision of the Board, which was ex- facie inconsistent with the plain language of Rule 13(i), could not have been relied upon for determining eligibility of the appellant for appointment as Laboratory Assistant in District Udhampur and the learned Single Judge and the Division Bench of the High Court committed serious mistake by nullifying the appellant’s challenge to the decision of the Selection Committee not to consider his candidature and that too by overlooking the fact that at the time of submission of application, the appellant was residing in District Udhampur, which was a main part of the State of Jammu and Kashmir. Consequently, the appeal was allowed and the impugned judgment of the learned Single Judge and the Division Bench of the High Court were set aside. 

Hence, It was declared that the appellant was eligible to be considered for the post of Laboratory Assistant for District Udhampur. The Board was directed to declare the result of the appellant’s interview within a period of 4 weeks.

Advent Hospitality Pvt Ltd Vs. Tristar Hotels Pvt Ltd - Jul 19 2012 (Delhi HC)

Arbitration and Conciliation Act, 1996 - Section 9; Specific Relief Act, 1963 - Section 12

The Petitioner herein filed a petition under Section 9 of the Arbitration and Conciliation Act, 1996 seeking an order restricting the Respondent Tristar Hotels Pvt. Ltd. from creating any third party rights or transferring, alienating, constraining or parting with possession in respect of the ''Svelte Business'' comprising the freehold property situated in the building known as ''Select City Walk'' situated at New Delhi and all ancillary movable and immovable assets owned by Tristar. On considering the submissions made by the parties, it appeared prima facie to the Court that there was a misrepresentation made by Tristar in the Agreement as regards the extent of the property in question. Tristar knew that the super area of the property was only 1, 17,377 sq.ft. and yet it was prepared to sell the property in question to an extent of 1,23,377 sq. ft. There was no satisfactory explanation offered by Tristar for this. Secondly, the relevant clause of the Select sale deed made it clear that Select retained the terrace rights. The corresponding clause in the Agreement was not any different. Despite knowing this, Tristar held out to Advent in the Agreement that the terrace rights would also get transferred to Advent upon Advent paying the entire sale consideration. The mere use of the words ''if any'' was not enough to improve the situation for Tristar. In Rachakonda Narayana v. Ponthala Paravthamma (2001) 8 SCC 173, the Supreme Court explained Section 12 (3) that the first part of the said provisions mandates refusal of specific performance of a contract on certain conditions. In the absence of any agreement in that behalf between the parties, for it to determine the value if any to be placed on the terrace rights which could not be conveyed to Advent and whether Advent should be accordingly compensated. The exact value of the space was also not possible to be determined. This would require a more detailed examination which was left to the arbitral Tribunal. The balance of convenience in restraining Tristar from creating third party rights on the property in question was in favor of Advent, subject to Advent being put to terms to demonstrate its willingness and readiness to proceed with the purchase of the property in question minus the terrace rights and 6,000 sq. ft. It was held that the order would not prevent either party from seeking its modification by filing an application before the arbitral Tribunal under Section 17 of the Act or for any other interim relief in accordance with law. It was clarified that nothing in this order should be interpreted as an expression of any final binding view on the merits of the contentions of either party and was not intended to influence the outcome of the arbitral proceedings. 

Hence, The petition was accordingly disposed of.

Source: TLR (web)

Prakash Verma

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                           An Important message -- Displaying over the MCA's website:-

“A Notification vide No. G.S.R. 716(E). dated 23.09.2011 was issued, in view of the order of the Hon’ble High Court of Delhi dtd. 21.04.2011 in the matter of M/s. S.E. Investment Limited Vs Union Of India and Others {W.P. (c) 2393/2010 and CM Appl. 4794/2011}, the Hon’ble Court had inter alia held that there is no provision in Delhi Stamp Act for payment of stamp duty on “Increased authorized share capital”. Therefore, the payment of stamp duty payable on increase of authorized capital being paid with filing of form no.5 with respect to State of National Capital territory of Delhi was made optional Now the Hon’ble High Court of Delhi at New Delhi vide order dated 18.10.2011 has stayed the impugned order. In view of the stay it is advisable to make the payment of stamp duty on filing of form 5 for increase in authorized capital with respect to state of National Capital territory of Delhi. “

Prakash Verma
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Highlights of Expert Group Report on Societies Registration Act 1860 for new Multi-State Societies Registration Bill, 2012 (MSSRB, 2011)

Introduction: An Expert Group was constituted by Ministry of Corporate Affairs to study the legislative and regulatory architecture of the Societies Registration Act, 1860 and to understand and gauge the ground level situation of societies operating in India at present.

The Group realized that that there are two different types of societies pertaining in India, one whose functions are restricted to only one state only and others, whose activities are spread in more than one state and it has drafted a Bill in respect of societies having multi- state operations which is called a Multi-State Societies Registration Bill, 2012 (MSSRB, 2011). . A model law governing the registration of societies having operation limited to one state will also be prescribed soon but the said law will have to adopted and enacted by each State separately.

It is to be further noted that at present there is no exclusive law governing the functioning of multi-state based societies. The Expert Group has drafted the bill governing the functioning of Multi-State Societies. The Bill seeks to regulate the working of Mulit State Societies by providing disclsore & reporting requirements and more powers to Central Government.

Moreover the current Societies Registration Act is very weak and doesn’t provides for effective regulation of working of the Societies. Though the Societies are required to submit document to Registrar of Firm from time to time but Societies hardly do the same. Moreover since Societies are not required to disclose their accounts therefore they are not subject to public scrutiny and lack transparency.

As per the expert committee report there are more than 30 Lakh societies that are registered in India, assuming the numbers, the new law will create a drastic impact on the working of all these.

Highlights of the Bill are as follows: 

• The Bill contains 63 clause , 8 chapters and 2 Schedules.
• The Bill proposes to provide an enabling framework for the registration and functioning of the multi-state societies. The definition of what constitutes a ‘multi-state society’ would be determined by the objective and nature of their activities as per the provision of the Proposed Bill
• One of the important definition, on the sidelines of which the Bill has been drafted is “Inter-State Activity”. Since this Bill has been specially drafted for the Multi-state operations based societies, this definition assumes more importance. It means any activity carried out by a society directly or indirectly for cash, or for deferred payment or for commission, remuneration or other valuable consideration from the place other than place of origin, including overseas transaction and also includes certain other transactions also. More importantly societies who receive foreign contribution or donation/grants /funds from NRI in excess of amount prescribed will also be treated as Inter State Activity
• "Multi-State Society" means any multi-state society registered under this Act or any society carrying on inter-state activity
• After the enactment of this Act and no matter what is contained in any other Act, no Multi-State Society can carry any inter-state activity without being registered under this Act. Existing multi state societies registered under the Societies Registration Act should, either register under this Act or stop carrying such activities within the prescribed time. Failure to obtain registration is an offence punishable under the proposed Bill.
• A multi-state society registered under this Act shall be deemed to be body corporate as on date Societies are not treated as Body Corporate
• Under the existing Act, the application for registration has to be made before Registrar of Joint-stock Companies, whereas the Bill requires the application to be made before Registrar of Multi-State Societies, as notified by the Ministry of Corporate Affairs (MCA). Detailed application will have to submitted for registration of Societies on an electronic platform.
• Compliances have been increased, intimation is required to be given to Registrar is case of certain events and an annual report of its inter-state activities is also required to be submitted with it.
• Every such society will now have to maintain books of accounts, on all receipts and expenditure, sales and purchases of goods and assets and liabilities of the society.
• Power have been given to Central Government to cancel the registration of Societies under certain circumstance , this was not there earlier.
• Mode of dissolution of Multi-State Societies has been prescribed in detail. It provides for two modes of dissolution for a multi-state society viz, a) voluntary; and b) compulsory. Voluntary dissolution may be ordered, if, a registered multi-state society makes an application to Central Government., signed by not less than three-fifths of the members of that multi-state society.
Compulsory dissolution may occur if the Central Government. has reason to believe that the society is being used for unlawful purposes or for purposes prejudicial to national security, peace, welfare or public order, or if the registration of any multi-state society has been procured by fraud or misrepresentation, or if the society is being used for the purposes incompatible with its objects or if the society becomes dormant.
• Central Government has the power to order mandatory winding of the society under certain circumstances.
• Majority of the officers and members of the Board of every multi-state society shall be citizens of India, which is a new requirement.
• Now members of the society can inspect its books and accounts, which was not allowed earlier.
• The bill provides elaborate provisions for Inspection, Inquiry and Investigation into the affairs of the society by the Central Government, which were not there earlier.
• Now Central Government may also require the society to furnish such information or documents, as it considers necessary, on scrutiny of any document filed by such society or any information received by the Government or in public interest. It will be the duty of the society and of its officers to coordinate in this respect. It may even authorize an inspector to make an inspection. , currently there is no such provision.
• Power has also been given to Central Government to order search and seizure of records and information of any society , which was not earlier.
• Penalties have been provided in case of furnishing false information, statement or destruction of records
• Central Government has also given the power to takeover the affairs of Society under prescribed conditions.
• Members of Governing body of Society has to obtain a Governing Body Identification Number on the line of Director Identification Number for Directors in case of Companies.
• The Bill also provides elaborate provisions for registration of foreign societies having place of business in India, which is not allowed currently. A foreign society is defined as a society or other association of individuals incorporated outside India within the meaning of Foreign Exchange Management Act, 1999.
• A new concept of Improvement Notice has been introduced. It provides that if a society has furnished false or misleading documents for obtaining registration or has failed to comply with the provisions of this act, in that case an ‘Improvement Notice’ will be served on it. Failure to comply with such notice will result in suspension of registration. Finally if a multi-state society fails to comply with the notice even during the period of suspension, then its registration will be cancelled.
• Similar to Companies & LLP, public can also inspect the records of the Multi State Societies maintained with the Registrar.
• Provision has been made to regulate the interest of the members in the contracts executed or entered into by the Societies.
• The Bill will also provide the formats in which the Financial Statement of the Society have to be prepared.


MCA has invited public comments on Multi-State Societies Registration Bill, 2012 . All those desirous of submitting views/suggestions may send their written views and suggestions on the Bill to Ministry of Corporate Affairs on e-mail at and alok

The person/interested party may also sent their comments/suggestions by post addressed to Smt. Renuka Kumar, Joint Secretary, Ministry of Corporate Affairs, Room No. 504, 5th Floor, ‘A’Wing, shastri Bhawan, New Delhi or Shri Alok Samantarai, Joint Director, Ministry of Corporate Affairs, Room No. 527, 5th Floor, ‘A’ Wing, shastri Bhawan, New Delhi by 15th of September, 2012.


Prakash Verma.
Contact E Id:

Monday, 23 July 2012

  A note on Common Seal of a Company
A Company is an Artificial Person in eyes of Law, it has no soul, it takes birth by the Operation of Law and ends it’s life by the Operation of Law. Like a natural person, it can’t sign by its own. As still it’s an Artificial Person and as it operates in the world market, there arises some situation where Law asks a Company to sign by putting its Common Seal on the Documents.

The acts of a Company in India are governed by the Companies Act, 1956. And this Companies Act, 1956 does not define the term ‘Common Seal’. Thus generally, a Common Seal mean the official seal of Company, wherein the name of the Company is engraved in full. Common Seals can generally be obtained from rubber stamp makers at minimal cost and at short notice. There is no compulsion under the Companies Act, 1956 that the common seal should be made in metal or any other material.

After the incorporation of a Company, generally in the first Meeting of Board of Directors the Common Seal of the Company is adopted, by passing a resolution in that meeting. If the Company desires substitute its Common Seal, then it can do so only with the authorization by the way of passing a resolution in any subsequent Board Meeting (or any Committee of the Board as authorised).

If authorised by its articles, a company can also have a Seal which shall be a facsimile of the common seal of the company even outside India, with the addition on its face, the name of the territory, district or place where it is to be used, generally to transact some business there, if necessitate the such Sealing. (Section 50 of the Companies Act, 1956).

The Common Seal of a Company is generally used for the following purposes:-
a. For Execution of Deeds empowering any person, either generally or in respect of any specified matters, as its attorney.
b. On the Share Certificate/Warrants of the Company
c. Loan Agreement with the Banker(s), etc.

Affixing the Common Seal of a Company in the documents, for whatsoever reason, is not required in every pages of the Documents. It is a general and acceptable practice to affix it at the Last / some of the necessary pages, beside the Signature of the Company’s Authorised Official.

The Authorised Official who puts the Common Seal on any document should sign and mention the date beside the seal.

The Companies are required to maintain a Register wherein the details of the Document(s), where Common Seal was affixed, has to entered.

Such Register has to be kept in the Safe Custody of the Official, who is duly authorised by the Board of Directors of a Company at the Registered Office of the Company.

***UK’s Companies Act, 2006 have made it optional for all the Companies to have Common Seal, but subject to the condition that if a Company wants to have a Common Seal then the name of the Company must be engraved in legible characters on the seal and failure to do so constitutes an offence under Section 45 of the Companies Act 2006.

Adoption of Common Seal - Board Resolution

In the meeting of the Board of Directors of a Company, by passing the following resolution, the Common Seal can be adopted.

In case of: Adoption of the Common Seal of the Company

The Common Seal engraved with the name of the Company was placed before the Board. The Board showed its satisfaction with the Seal design and approved the same.

Upon motion duly passed and seconded, it was Resolved that:

“RESOLVED THAT the Common Seal as submitted to this meeting, an impression of which be affixed in the margin of the minutes and be initiated by the chairman, be and is approved and adopted as the Common Seal of the company.

RESOLVED FURTHER THAT the Common Seal together with the Blocks and engravings be kept under the safe custody of Shri R, Company Secretary or in the absence of whose, be handed over to Shri J, General Manager – Finance for the safe custody of the same."

Source: ICC (web)

Prakash verma
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                         Appointment of Alternate Director - Resolutions
There are three situations which relates to the appointment of Alternate Director as prescribed under Companies Act, 1956.

(1) In case the Articles of Association of a Company have provision regarding Appointment of Alternate Director

Draft Board Resolution for Appointment of Alternate Director :

“RESOLVED THAT pursuant to Section 313 and all other applicable provisions of the Companies Act, 1956, (including any statutory modification(s), enactment(s) or re-enactment(s) thereof for the time being in force) and in terms of the provisions of the Article No. __ of the Article of Association of the Company, Shri X be and is hereby appointed as an Alternate Director to Shri XX, Executive Director during his absence from the State of ______ and who shall vacate his office as and when Shri XX, Executive Director returns to the said state."

(2) In case the Articles of Association of a Company does not have any provision for Appointment of Alternate Director(s)

Draft General Meeting Resolution – Authorising Board of Directors for Appointment of Alternate Director :

“RESOLVED THAT pursuant to Section 313 and all other applicable provisions of the Companies Act, 1956, (including any statutory modification(s), enactment(s) or re-enactment(s) thereof for the time being in force), the Board of directors of the Company be and is hereby authorised to appoint an Alternate Director to act for a Director (hereinafter called 'the Original Director') during his absence for a period of not less than 3(three) months from the State of ______ and an alternate director shall vacate his office as and when original director returns to the said state."

Explanatory Statement:

The Director(s) of the Company have been frequently travelling across various States in India to deal with different Business cases. In the absence of whose it has become necessary that another temporary Director be there in the Company to handle the Business. Section 313 of the Companies Act, 1956 provides that the Board of directors of a company may, if so authorised by its Articles or by a resolution passed by the Company in general meeting, appoint an alternate director to act for a director during his absence from the State. Since the Articles of Association of the Company do not provide for the appointment of alternate director, the proposed resolution seeks the necessary authority of the general meeting to enable the Board of directors to appoint alternate director as and when necessity arises. 
And once the above resolution is passed in the General meeting of the Members of a Company, thereafter the Board of Directors can appoint an Alternate Directors in their meeting.

(3) In case of addition of New Article in the Alteration of Association of the Company for Appointment of Alternate Director

Draft Special Resolution for Alteration of the Articles of Association of the Company for Appointment of Alternate Director :

To consider and if thought fit, to pass, with or without modification(s), the following resolution as a Special Resolution:

“RESOLVED THAT pursuant to Section 31 and all other applicable provisions of the Companies Act, 1956, (including any statutory modification(s), enactment(s) or re-enactment(s) thereof for the time being in force), the Articles of Association of the Company be and is hereby amended by adding a new article 40A, Appointment of Alternate Director, as follows:

‘The Board may appoint any person to act as an Alternate Director for a Director(hereinafter called as ‘the Original Director’ in this Article no..........., subject to the provisions of section 313 of the Companies Act, 1956, during the absence of that Original Director for a period of not less than three months form the State in which meetings of the Board are ordinarily held.

An Alternate Director shall be entitled to notice of meetings of the Board and to attend and vote there at accordingly, but he shall ipso facto vacate office if and/when the absent director returns to State in which meetings of the Board are ordinarily held or the absent Director vacates office as a Director.

An Alternate Director if appointed by more than one original director, will be entitled to vote for all original directors but sitting fees shall be paid in respect one director only.'

RESOLVED FURTHER THAT Shri A, Director and Shri B, Company Secretary be and are hereby severally authorised to perform all acts, deeds and things, execute documents, and make all filings, as may be necessary to give effect to the above resolution and to take all such steps for giving any such direction as may be necessary or desirable.”

Source: ICC (WEB)

Prakash Verma
Follow us @ True Governance League 

Thursday, 19 July 2012


New Delhi: The Union Cabinet on Thursday approved a proposal making rape a gender-neutral offence, under which the word 'rape' would be replaced by the phrase 'sexual assault'. 

Another proposal to make carrying out of acid attacks a separate offence punishable by a maximum of 10 years has also been approved. Both the proposals were approved by the Cabinet at a meeting in New Delhi on Thursday evening. 

The amendment would expand the definition so that cases of sexual assault where the victims are male would also fall under the same law along with cases where the victims were women. 

At present, the offence is defined under section 375 of the Indian Penal Code as per which a man is said to commit 'rape' in case he has sexual intercourse with a woman against her will. 

When asked, Women and Child Development (WCD) Minister Krishna Tirath said the Cabinet had given a go-ahead to the draft proposal. 

She said the Cabinet had also given a go-ahead to another proposal of her ministry as per which carrying out an acid attack against any person should be brought under a separate act punishable with a maximum ten years of imprisonment. 

Krishna further said it had also been decided by the cabinet that certain sections of CrPC or IPC, which define minors as below the age of 16, would be amended and a uniform age bar of below 18 years, would be set as the legal age for minors.

Source: on 19th July, 2012

Prakash Verma

Sunday, 15 July 2012

Criminal Prosecution can be Initiated for wrong disclosure in Balance Sheet

SANJAY SURI V. STATE [2010] 157 COMP CAS 10 (DEL) V.K.Jain, J [Decided on 29-1-2010]

Sections 209(6) and 217(1) of the Companies Act, 1956 read with sections 468, 469(1)(b) and 482 of the Cr.P.C –

Failure by company to give proper disclosure in balance-sheet regarding collateral security and activities relating to export.

Prosecution initiated by ROC –
1. There was a contravention of section 212 (1) as the company had acquired in excess of 90% of shareholding .

2.No proper disclosure was made in the balance sheet regarding the collateral security thereby its bank account was attached due to a court order and no contingent liability was disclosed towards this.

3.Its director report failed to disclose activities relating to exports , action initiated to enhance the exports , expansion of new export markets .

The defendants argued that the complaint was barred by limitation. The ROC cannot be regarded as " person of aggrieved " under section 469 (1) (b) of the Criminal Procedure , 1973.

Trial Court took cognizance of the offence-summons issued against the directors – Whether criminal proceedings can be quashed- It was held by the Court as No as the petitioners were the persons obliged to make sure compliance of the appropriate provisions of the Act and the officers in default at the appropriate time.

Prakash Verma
True Governance League 

Saturday, 14 July 2012


Brief: According to a Supreme Court judgement dated 19/02/2008 in the case of Thiruvengada Pillai Vs Navaneethammal and Anr.,


Judgment: According to a Supreme Court judgment dated 19/02/2008 in the case of Thiruvengada Pillai Vs Navaneethammal and Anr, the stamp papers do not have any expiry period. Relevant extract from SC Judgment is reproduced herein below:
"The Indian Stamp Act, 1899 nowhere prescribes any expiry date for use of a stamp paper. Section 54 merely provides that a person possessing a stamp paper for which he has no immediate use (which is not spoiled or rendered unfit or useless), can seek refund of the value thereof by surrendering such stamp paper to the Collector provided it was purchased within the period of six months next preceding the date on which it was so surrendered.

The stipulation of the period of six months prescribed in section 54 is only for the purpose of seeking refund of the value of the unused stamp paper, and not for use of the stamp paper. Section 54 does not require the person who has purchased a stamp paper, to use it within six months.

Therefore, there is no impediment for a stamp paper purchased more than six months prior to the proposed date of execution, being used for a document.

Prakash Verma

Wednesday, 11 July 2012

Latest Case - Supreme Court of India

Cox & Kings Ltd. Vs. Indian Rly. Catering & Tourism Corporation Ltd.& Anr., (With Contempt Petition (Civil) Nos.41-43 of 2012 In Special Leave Petition (Civil) Nos.965-967 of 2012) - Jul 5 2012 

Arbitration and Conciliation Act, 1996 - Section 9
The Ministry of Railways sanctioned the proposal submitted by the Indian Railway Catering & Tourism Corporation Ltd. for operating a Luxury Tourist Train on a Pan- India route within India. The Petitioner was selected as the Joint Venture shareholder for the operation of the Luxury Tourist Train Project. The proposal was approved based on certain principles for running the said train which was set out by the Indian Railways. During the operation of the Joint Venture certain disputes arose between the shareholders regarding the working of the Joint Venture Agreement and the Memorandum of Understanding, which led to the termination of the lease arrangement by the Respondent, IRCTC. The Petitioner initiated a proceeding under Section 9 of the Arbitration and Conciliation Act, 1996, under the Arbitration Clause contained in Article 30 of the Joint Venture Agreement, for staying the termination of the lease agreement and also to allow the arrangements to continue. It was pointed out by the Division Bench of the High Court, that the Petitioner was not entitled to question the termination as by itself it had no existence as far as the running of the train was concerned and it was not a party to the proceedings. In fact, the Petitioner had attempted to either fix the Lease Agreement, which was terminated, or to create a fresh Agreement to enable the Petitioner to run the luxury train till a decision was arrived at in Clause 9 of the Application. Though the Petitioner had invested large sums of money in the project, it was not entitled to pray for and obtain a compulsory order of injunction to operate the train once the lease agreement was terminated. The Division Bench rejected the submission that the Joint Venture Agreement was similar to a partnership. The Division Bench of the High Court stated that the Petitioner’s remedy would lie in an action for damages against IRCTC for breach of any of the terms and conditions of the Joint Venture Agreement and the Memorandum of Understanding. It was held that parties should appoint an Arbitral Tribunal to settle their disputes regarding the operation of the train by IRCTC. The Special Leave Petitions was therefore dismissed and it was also stated that if an Arbitral Tribunal is appointed, the aforesaid arrangement would be subject to the decision of the Arbitral Tribunal and that the observations made by the learned Single Judge, the Division Bench of the High Court and this court, should not, in any way, influence the outcome of the arbitral proceedings, if resorted to by the parties.

Vishwanath S/o Sitaram Agrawal Vs. Sau. Sarla Vishwanath Agrawal - Jul 4 2012

The Hindu Marriage Act, 1955 (for brevity ''the Act'') - Section 13(1) (ia); Code of Civil Procedure - Section 100; Indian Penal Code - Sections 494, 498A
The marriage between the appellant and the respondent was solemnized as per the Hindu rites but due to total disagreement in their marital life the appellant-husband filed a petition for divorce under Section 13(1) (ia) of The Hindu Marriage Act, 1955. The main issues involved in this matter were whether the appellant was able to prove the alleged cruelty and whether he was entitled to take disadvantage of his own wrong. The learned trial Judge dismissed the application and also dismissed the application of the respondent-wife for grant of permanent alimony. The appellant-husband preferred Civil Appeal which was again dismissed. Being dissatisfied with the judgment and decree passed by the learned appellate Judge, the husband preferred Second Appeal before the High Court. It was stated that the expression ''cruelty'' had an inseparable link with human conduct or human behaviour. It was always dependent upon the social strata or the milieu to which the parties belong, their ways of life, relationship, temperaments and emotions that had been conditioned by their social status. The conduct and circumstances made it clear that the respondent-wife had really humiliated him and caused mental cruelty. Her conduct clearly showed that it had resulted in causing agony and anguish in the mind of the husband. She had publicized in the newspapers that he was a womanizer and a drunkard. She had made false allegations about his character. She had made an effort to prosecute him in criminal litigations which she had failed to prove. The feeling of deep torture, disappointment and frustration of the husband was apparent. Thus, it was held that husband could not be asked to put up with the conduct of the wife and to continue to live with her. Therefore, he was entitled to a decree for divorce. The other issue was the grant of permanent alimony. Permanent alimony was to be granted taking into consideration the social status, the conduct of the parties, the way of living of the spouse and such other adjunct prospects. The amount that was already paid to the respondent- wife towards alimony was to be ignored as the same had been paid by virtue of the interim orders passed by the courts. It was not expected that the respondent-wife had sustained herself without spending the said money. Cases referred to were: i.) Sirajmohamedkhan Janmohamadkhan vs. Hafizunnisa Yasinkhan and another, (1981) 4 SCC 250, ii.) Shobha Rani vs. Madhukar Reddi, 1988 (1) SCC 105. The appeal was allowed, the judgments and decrees of the courts below were set aside. Consequently, a decree for divorce in favor of the appellant was granted and the wife was granted Rs.50 lacs towards permanent alimony.

Saturday, 7 July 2012


Securities and Exchange Board of India has come up with yet another investor protection measure on July 06, 2012 vide Circular no.CIR/MIRSD/8 /2012 wherein the time limit for transfer of Equity Shares & Debt Securities for listed companies has been reduced to 15 days.

For analytical views on it please see the article on the following link:

Please do encourage your friends/colleagues to join this group - we continue to feed you with important updates

Prakash Verma

True Governance League - A Way to Root

Sunday, 1 July 2012

True Governance League

True Governance League - A Way to Root

Recent Amendments:

- Due date for filing Annual Return for the LLP for the year ended 31st March, 2012 has further been extended to 31st July, 2012

- Change of shareholding pattern, with ulterior motive of gaining management control, is oppression By [2012] 22 302 (CLB)

- SEBI : Mumbai court could entertain complaint against a Kolkata listed company for fraud took place in Mumbai By [2012] 22 294 (BOM.)

- IT : Premium paid to insurer under 'Group Leave Encashment' scheme is out of sec. 43B ambit [Kerala]

- Appeal not admissible if admitted tax not paid; the defect is curable if tax is paid afterward By [2012] 22 235 (HYD. - ITAT)

- IT : Business of assessee becomes ready to commence upon set up of requisite infrastructure By [2012] 22 251 (DELHI)

- If comparables are selected to make positive adjustments only, such selection is unjustified By [2012] 22 236 (CHENNAI - ITAT)

- Awarding of contract to lowest bidder is not 'price sensitive' news for insider traders By [2012] 22 311 (SAT)

- CCI runs bulldozer over cement industry forming an anti-competitive cartel; Rs. 6,300 crores penalty slapped By [2012] 22 266 (CCI)

- ICSI releases Know Your Client norms for Practicing Company Secretaries

- Members may now upload their resume by logging in to

Prakash Verma
True Governance League