Leading Corporate and Commercial Law Cases in May 2023

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  1. M/s. Asian Avenues Pvt Ltd vs Syed Shoukat Hussain

Citation: Asian Avenues Pvt Ltd.vs Syed Shoukat Hussain, (28.04.2023 – Supreme Court): MANU/SC/0492/2023; Decided by Justice Abhay Shreeniwas and Justice Rajesh Bindal

Ratio: The Supreme Court of India examined the arbitration clause in the Development Agreement and concluded that the dispute concerning the cancellation of the agreement falls within the scope of arbitration and can therefore be referred to arbitration. In reaching this decision, the Court referred to the precedent set in the Deccan Paper Mills case and determined that an action filed under Section 31 of the Specific Relief Act, seeking cancellation of an instrument, is not an action in rem. Consequently, the Trial Court’s original order referring the parties to arbitration was deemed appropriate and justified.

  1. Prasanna and Others V Mudegowda (D) By Lrs

Citation: Prasanna and Others V Mudegowda (D) By Lrs, (27.04.2023 – SC): MANU/SC/0489/2023; Decided by Justice Rajesh Bindal and Justice Aravind Kumar

Ratio: The Supreme Court took note of the fact that the defendant’s mother stated in her testimony that she had been in possession of the disputed property for 14 years prior to her deposition in 2002. The Court explained that it was precisely for this reason that the appellants’ claim of acquiring ownership through adverse possession was rejected by both the Trial Judge and the High Court. The Court further observed that the property’s title had been decreed in the name of Mudegowda, and therefore the deceased respondent was not required to establish possession prior to the initiation of the lawsuit.

  1. Moser Baer Karamchari Union thr. President Mahesh Chand Sharma vs. Union of India (UOI) and Ors.

Citation: Moser Baer Karamchari Union thr. President Mahesh Chand Sharma vs. Union of India &Ors. (02.05.2023 – SC): MANU/SC/0507/2023; Decided by Justices MR Shah and Sanjiv Khanna 

Ratio: The IB Code governing liquidation is a result of an extensive consultative process, aiming to maximize asset value and balance stakeholders’ interests. It follows a time-bound framework and aligns Indian practices with global standards. The priority of payments in liquidation prioritizes secured creditors and unpaid dues of workmen. The Code ensures equitable compensation to workmen while safeguarding secured creditors’ interests for economic revival. It allows experimentation for economic gains. The court stated that the sub-section (7) of Section 327 of the Companies Act, 2013 provides that Sections 326 and 327 of the Act, 2013 shall not be applicable in the event of liquidation under the IBC, which has been necessitated in view of the enactment of IBC and it applies with respect to the liquidation of a company under the IBC, Section 327(7) of the Companies Act, 2013 cannot be said to be arbitrary and/or violative of Article 21 of the Constitution of India.

  1. Union of India vs Deloitte Haskins

Citations: Union of India vs Deloitte Haskins: Crl. A. No.-002305-002307 / 2022, SC of India; Decided by Hon’ble Mr. Justice M.R. Shah and Hon’ble Mr. Justice C.T. Ravikumar

Ratio: The Respondent Auditor attempted to avoid proceedings u/ Section 140(5) of the Companies act i.e., proceedings to dismiss an auditor who has acted in a fraudulent manner or abetted or colluded in any fraud by the assessed company by resigning from the post of auditor.

Held, resignation from the position of auditor shall not absolve the auditor from penalty proceedings under the Companies Act for collusion in fraud. The NCLT is directed to still determine the serious offence of fraud.

Obiter: The Section 140(5) was held to be not arbitrary and the same did not violate Article 14 and 19(1)(g) of the constitution of India.

  1. Activities carried out by CA, CS and CWA on behalf of clients to be covered under PMLA [F. No. P-12011/12/2022-ES Cell-DOR]

The Government has notified an amendment to the definition of a ‘person carrying on designated business or profession’ u/s 2(1) (s.a). As per the amended norms, financial transactions carried out by practicing CA/CS/CWA on behalf of their clients will now fall under the scope of the Prevention of Money Laundering Act. The transactions include the activities such as buying and selling of any immovable property, managing client money, securities, or other assets etc.

  1. Alpesh Narendra Shah and Another Vs Manoj Agarwal

Citation: Alpesh Narendra Shah and Another Vs Manoj Agarwal: Crl.Rev.P. No.02 of 2019, HC of Sikkim, Gangtok, Decided by Justice Meenakshi Madan Rai

Ratio: The parties filed a compounding application before the High Court for offence of cheque dishonor u/ Section 138, NI Act.  Held, compounding application can be filed at any stage even if barred under Section 320(9) of the Cr.P.C. (which otherwise provides that no offence shall be compounded except as provided by the Section), since Section 147 of the NI Act was inserted by way of an amendment as a special law and has overriding effect.

  1. The Sub Registrar, Amudalavalasa & Anr. v. M/s Dankuni Steels Ltd. & Ors.

    Citation: The Sub Registrar, Amudalavalasa & Anr. v. M/s Dankuni Steels Ltd. & Ors. (26.04.2023 – SC of India): MANU/SC/0460/2023; Decided by Justice K.M. Joseph and Justice Hrishikesh Roy

Ratio: The parties bought land and attached machinery at auction for total consolidated amount of Rs. 8.35 crores. However, the parties claimed that the value of the agreement for sale was only 1.01 crores as the machinery and plant on the land was separate and exempted from stamp duty.

Held, the value of the plant and machinery are also calculated as part of the stamp duty amount. Immovable property has been defined in the General Clauses Act, 1897 as ‘including land, benefits to arrive out of land and things attached to the earth or permanently fastened to anything attached to the earth’. Further, the value of the agreement itself was Rs. 8.35 crores, indicating clearly that such machinery was intended to be part of the transfer of assets. When the property is machinery attached to the earth, the movable parts thereof also are comprehended in the transfer.

  1. Farooq Ahmad Mir Vs Nisar Ahmad Wani & Ors

Citation: Farooq Ahmad Mir Vs Nisar Ahmad Wani & Ors.: CM (M) 62/2023, HC of Jammu & Kashmir & Ladakh (Srinagar), Decided by Hon’ble Mr. Justice Javed Iqbal Wani.  

Ratio:  The court cannot frame an issue on the points either not pleaded or abandoned or else determine an issue not arising from the pleadings of the parties. The court also is not permitted to stretch the issues which on reasonable interpretation does not fall within the pleadings on which the issues were founded and if the pleadings do not contain necessary foundation for raising an issue.

  1. District Government Pleaders Public Prosecutor Vs ACIT

Citation: District Government Pleaders Public Prosecutor Vs ACIT (29.03.2023 – ITAT, Ahmedabad Bench): MANU/IB/0141/2023; Decided by Annapurna Gupta, Member (A) and Siddhartha Nautiyal, Member (Judicial)

Ratio: It shall be the responsibility of the person deducting any sum u/ Section 200 of the Income Tax Act to prepare statement u/ Section 200A of the Income Tax Act, 1961. In, it was found that the government was directly paying remuneration to the public prosecutors. The CIT(A) also failed to enquire into the aspect whether the assessee was under a legal obligation to file TDS return in respect of TDS so deducted. The file was subsequently restored to CIT(A) to analyze under what capacity the assessee is filing TDS returns and whether the assessee in the first instance, is under an obligation, to file statement of tax deducted at source u/s. 200A of the Act.

  1. Vistra ITCL (India) Ltd & Ors vs Dinkar Venkatasubramanian & Ors

Citation: Vistra ITCL (India) Ltd & Ors vs Dinkar Venkatasubramanian & Ors (04.05.2023 – SC): MANU/SC/0526/2023; Decided by Justice M.R. Shah and Justice Sanjiv Khanna

Ratio: In the above case, Vistra ITCL (India) Ltd. is classified as a secured creditor, but it does not fall under the category of financial creditors or operational creditors, as per the Supreme Court’s previous decisions in Anuj Jain and Phoenix ARC. This unique situation creates a complex legal issue where a secured creditor is denied certain rights and benefits that would otherwise be available to financial creditors and operational creditors under the provisions of the Insolvency and Bankruptcy Code (“Code”). Under Section 52 of the Code, a secured creditor in liquidation proceedings has two options. The first option is to relinquish its security interest to the liquidation estate and receive proceeds from the sale of assets by the liquidator as per Section 53 of the Code. The second option allows the secured creditor to realize its security interest in the manner specified in Rule 21-A of the Liquidation Process, 2016.

The Court recognizes that the intent of the amended Section 30(2) of the Code, read with Section 31, is to protect the interests of other creditors who are outside the purview of the Committee of Creditors (CoC). However, this inadvertently puts Vistra in a difficult position, being denied the rights under Section 52 and Section 53 in respect of the pledged shares, despite being a secured creditor. The Court proposed two possible solutions to this legal conundrum, first was to treat Vistra as a financial creditor to the extent of the estimated value of the pledged shares on the date of commencement of the Corporate Insolvency Resolution Process (CIRP). This would make Vistra a member of the CoC with voting rights equivalent to the estimated value of the pledged shares. However, implementing this solution may require reconsideration of the earlier decisions in Anuj Jain and Phoenix ARC, necessitating a reference to a larger bench. Moreover, in the present case, where the resolution plan has already been approved by the CoC without Vistra’s participation, this option may not be practically viable. Second is to treat Vistra as a secured creditor under Section 52, read with Section 53 of the Code. This would entitle Vistra to retain its security interest in the pledged shares and claim the proceeds from the sale of these shares, in accordance with the provisions of Section 52 and Rule 21-A of the Liquidation Process Regulations.

The Court deemed this option as fair and just, providing a workable solution to the issue at hand. Based on these findings, the Hon’ble Supreme Court modifies the impugned judgment of the NCLAT and held that M/s. Vistra ITCL (India) Ltd. shall be treated as a secured creditor entitled to all the rights and obligations as applicable to a secured creditor under Sections 52 and 53 of the Code and in accordance with the pledge agreement dated 05.07.2016.

  1. Gurbinder Singh Mahal vs ITO, Ward IV (2) Amritsar

Citation: Gurbinder Singh Mahal vs ITO, Ward IV (2) Amritsar, I.T.A. No.22/Asr/2023, Income Tax Appellate Tribunal Amritsar Bench, Decided by Dr M.L. Meena, Member (Accountant) and Anikesh Banerjee, Member (Judicial)

Ratio: Assessee is not liable for payment of tax related to sale of property which belongs to the father. The son cannot be a deemed assessee even if the power of attorney for sale of land is in is name and money is credited to bank account of the son.

  1. Buddheshwar v. Maharashtra State Electricity

Citation: Buddheshwar v.  Maharashtra State Electricity (28.04.2023 – HC of Bombay, Nagpur Bench): MANU/MH/1647/2023, Decided by Justice R.B. Deo and Justice Anil L Pansare

Ratio: In the present case, the Petitioner was appointed as a peon in the Respondent Company on compassionate grounds due death of father in harness. Appointment order filled in by employee stated that if verification reveals adverse character or incident, the employee shall be terminated. It was subsequently found that the Petition had previous been arraigned as Accused of offences u/ Sections 143, 147, 149, 323, 294, 504 and 506 of the Indian Penal Code, 1860.

Held, suppression of material fact of criminal antecedents, while being grounds for dismissal of the employee, does not lead to automatic requirement to terminate said employee. The employer has discretion to determine based on the facts of the case whether such suppression is bona fide or is of a trivial nature and allow continued employment. Order of termination was set aside, and employer was directed to reconsider the termination and examine the dismissal on compassionate grounds. It is clarified that employee shall not be entitled to reinstatement or any other relief till the employer has a fresh look at the matter.

Obiter: Verification of character and antecedents is an important criterion to assess suitability, the ultimate action should be based upon objective criteria on due consideration of all relevant aspects and while an employee who suppressed material information cannot claim unfettered right for continuity in service, he has a right not to be dealt with arbitrarily. McCarthyism is antithesis to constitutional goal and chance of reformation has to be afforded to young offenders in suitable cases.

  1. Rohit Nath v KEB Hana Bank

Citation: Rohit Nath v KEB Hana Bank, C.R.P.No.2513 of 2022 and C.M.P.No.12925 of 2022, HC of Madras, Decided by Raja and Justice D Bharatha Chakravarthy

Ratio: In the above case, Mr. Rohit Nath, the promoter of Alectrona Energy Private Limited, challenged the jurisdiction of the Debts Recovery Tribunal (DRT) to deal with the bankruptcy process initiated by the bank against him. He argued that the National Company Law Tribunal (NCLT) had exclusive jurisdiction under Section 60(1) of the Insolvency and Bankruptcy Code (IBC). The bank, represented by its counsel, contended that the purposes of the insolvency resolution process and the liquidation/bankruptcy process were different, and therefore, the bankruptcy process against the promoter should be independently dealt with by the DRT.

The Madras High Court, relying on the Supreme Court’s judgment in State Bank of India v. V. Ramakrishnan, held that Section 60(1) of the IBC did not confer exclusive jurisdiction on the NCLT for insolvency proceedings of personal guarantors to corporate debtors. The court also referred to Section 179 of the IBC read with the 2019 Rules, which designated the DRT as an adjudicating authority. It concluded that since the bankruptcy process and the corporate insolvency resolution process had different objectives, the bankruptcy proceedings need not be transferred to the NCLT. This judgment clarifies the jurisdiction of the DRT and NCLT in handling insolvency resolution and bankruptcy processes for personal guarantors.

  1. Dr R Pavithra v The Commissioner of Police

Citation: Dr R Pavithra v The Commissioner of Police, WP(Cri). No. 6789 of 2021 and WMP.Nos.7343 & 7345 of 2022, HC of Madras, Decided by Justice RN Manjula

Ratio: In the present matter, the bank account of the Petitioner was hacked by third parties and money was siphoned off. The Petitioner upon realization of the event, informed the Bank and took precautions such as change of Mobile Banking Personal Identification Number (MPIN). Despite the same, the account was repeatedly hacked, and money was siphoned off. It came to light that the hack occurred due to a vulnerability in Paytm app which the hackers had used to siphon money.

Held, despite Paytm not originally being impleaded as a party (they were subsequently impleaded sou moto by the court), since they were aware of the hack due to being informed by the Bank and had not stepped forward to take action, Paytm was held liable to reimburse the Petitioner. Further, the RBI guidelines to Payment Aggregators mandated that customer complaints be handled within 90 days which Paytm had failed to do so. Due to Paytm being a private party, the court modified relief directing RBI which was also a respondent to issue directions to Paytm to make good such loss suffered by the Petitioner.

  1. Skil Himachal Infrastructure & Tourism Ltd & Ors vs IL & FS Financial Services Ltd.

Citation: Skil Himachal Infrastructure & Tourism Ltd & Ors vs IL & FS Financial Services Ltd. Commercial Appeal (L) No. 95 Of 2020 in Summons for Judgment No. 83 Of 2019 in Commercial Summary Suit No. 923 Of 2019 with Interim Application No. 1801 Of 2020 in Commercial Appeal (L) No. 95 Of 2020, HC of Bombay, Decided by Justice Gauri Godse and Justice G.S. Patel

Ratio: Section 13 of the Commercial Courts Act permits only appeals (i) against decrees; (ii) against orders rejecting applications under the CPC or Arbitration act. Therefore, appeal from an order granting conditional leave to defend in summons for judgment in a commercial summary suit is not maintainable. This is due to reasoning that the rights of the appellants have not been substantively decided, therefore no appeal shall lie. There should be some sort of a decree to be held to be appealable.

  1. Rama Krishna Raju Samanthapudi and Ors. v. State of Andhra Pradesh and Anr

Citation: Rama Krishna Raju Samanthapudi and Ors. v. State of Andhra Pradesh and Anr, Criminal Petition No.2038 Of 2021, HC of Andhra Pradesh, Decided by Hon’ble Justice Sri Ninala Jaayasurya

Ratio: Persons cannot be deprived of right to travel on the premise that criminal proceedings are pending against them. In the present quashing petition u/ Section 482 Cr.P.C., the Petitioners No. 2 & 3 were denied passport renewal to travel to the USA for marriage of Petitioner No. 1. The Petitioners were accused of offences punishable under Sections 498-A, 417 of IPC and Sections 3 & 4 of Dowry Prohibition Act.

Held, mere apprehension that travel is with intention to avoid proceedings is not a valid ground to deny right to travel as there are ways and means to secure the presence of the petitioners, if they are avoiding the legal proceedings, initiated against them. Thus, the application was allowed and Petitioner No. 2 and 3 were allowed to travel to the USA if they shall file Affidavit of undertaking that as and when required by this Court or any other Court in connection with the Criminal proceedings initiated against them.

  1. Sumit Subhaschandra Gangwal vs State of Maharashtra

Citation: Sumit Subhaschandra Gangwal vs State of Maharashtra (27.04.2023 – SC of India) MANU/SCOR/57611/2023, Decided by Justice B.R. Gavai, Justice Vikram Nath and Justice Sanjay Karol

Ratio: The Supreme Court has ruled that any undue delay in issuing an order related to the freedom and rights of a citizen is inconsistent with the constitutional principles and obligations.

  1. SPJ Cargo Pvt Ltd vs Blossom Grocery & Foods India Pvt. Ltd

Citation: SPJ Cargo Pvt Ltd vs Blossom Grocery & Foods India Pvt. Ltd., Company Appeal (AT)(Insolvency) No. 1374 of 2022, NCLAT Delhi; Decided by Justice Ashok Bhushan (Chairperson) and Mr. Barun Mitra, Member (Technical)

Ratio: The above case was an appeal against the NCLT Mumbai’s order wherein the original petition would be dismissed if the petitioner did not pay 5 lakhs to the Interim Resolution Professional (IRP) before the next hearing. The Operational Creditor (OC) appealed the order to the NCLAT Delhi and obtained a stay order, followed by a final order in their favor. The grounds of appeal included that payment to the IRP is not a valid ground for rejection under Section 9(5) of the IBC, and relevant regulations allow the applicant to determine the IRP’s fees. The recent amendment introduced Regulation 34B of IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016, which sets a minimum fee for the IRP, but the petitioner’s agreed-upon fees were higher than the prescribed minimum.

The NCLAT’s final order was presented before the NCLT Mumbai, and the original application under section 9 of the IBC, 2016 was allowed and CIRP was initiated.

  1. Sanket Kumar Agarwal & Anr Vs. APG Logistics Pvt. Ltd.

Citation: Sanket Kumar Agarwal & Anr Vs. APG Logistics Pvt. Ltd., Civil Appeal No. 748 OF 2023, SC of India; Decided by Hon’ble Chief Justice Dr Dhananjaya Y Chandrachud and J. B. Pardiwala

Ratio: In the present case, the Supreme Court allowed application for condoning the delay in filing appeal before NCLAT. As per the NCLAT Rules, the limitation period for filing appeal is 45 days. In the present case, as the Appellant was awaiting certified copy of the order, the appeal was filed on 46th day. The Supreme Court held that the days that the Appellant was awaiting certified copy of the order should have been excluded from the computation of delay.

  1. Umesh Rai @ Gora Rai vs State of Uttar Pradesh.

Citation: Umesh Rai @ Gora Rai vs State of Uttar Pradesh, Criminal Appeal No.1518 /2023, SC of India; Decided by Justice Sanjay Kishan Kaul and Justice Ahsanuddin Amanullah

Ratio: Appellant had been in custody for 16+ years and despite judgment being reserved no judgment was issued. Held that, the same bench cannot hear a matter if judgment is not pronounced within six months and matter the should be placed before another Bench for fresh arguments. Appellant released on interim bail.

  1. Kiran Thakur vs Resident Commissioner Bihar Bhavan

Citation: Kiran Thakur vs Resident Commissioner Bihar Bhavan, W.P.(C) 1668/2014, HC of Delhi, Decided by Hon’ble MS. Justice Mini Pushkarna

Ratio: In the mentioned case, it was found that employee of Group-IV (menial) job had forged the 8th standard passing certificate and fraudulently appointed on compassionate grounds.

It was held that despite the passing of class 8th not being a requirement for compassionate appointment in Group-IV job, employees who are guilty of submitting forged documents to their employer, must be dealt with in a strict manner. If a person submits forged and fabricated documents, then such a person is certainly unfit to be employed. No sympathy or compassion can be shown to such an employee. Dismissal was thus upheld.

  1. Ram Ayodhya Singh vs The State of Bihar

Citation: Mr. Ram Ayodhya Singh vs The State of Bihar, Civil Writ Jurisdiction Case No.3456 of 2021, HC of Patna, Decided by Hon’ble Justice Rajeev Ranjan Prasad

Ratio: In the present case the seizure of vehicles mortgaged by owners to financial institutions (“FIs”) were challenged.

Held, a writ petition is maintainable against private parties in the present case as petitioners are essentially complaining of violation of their fundamental rights to earn their livelihood with dignity. They are complaining of ‘deprivation’ in the hands of the contesting respondents without following the law and by use of force which cannot be permitted in a State governed by rule of law. Further, the FIs in question had not followed the RBI guidelines regarding the procedure to be followed by recovery agents.

The investigating agency was thus directed to independently investigate the repossession of the vehicles. The Superintendent of Police of all the districts in the State of Bihar are directed to ensure that within their jurisdiction no recovery agent of the Bank and Financial Institution may take the law into their hands and RBI guidelines shall be strictly followed. Petitioners and FIs were directed to reconcile the account and determine amounts and vehicles shall be released upon payment of 30% of outstanding amount. If FI is not in a position to restore the vehicle, they would be liable to pay the petitioner(s) to the extent of the value of the vehicle(s) as per their insurance value.

  1. Arpan Packaging Pvt. Ltd. vs. Regma Ceramics Pvt. Ltd.

Citation: Arpan Packaging Pvt. Ltd. vs. Regma Ceramics Pvt. Ltd., (12.04.2023 – NCLAT, Chennai Bench) MANU/NL/0342/2023; Decided by M. Venugopal, Member (Judicial) and Shreesha Merla, Member (Technical)

Ratio: The National Company Law Tribunal (NCLT) deemed Arpan Packaging’s application a “pre-existing dispute” as they had approached the MSME Facilitation Council under the MSMED Act. Thus, the NCLT barred them from filing a Section 9 Petition under the IBC. Arpan Packaging appealed to the NCLAT, but it upheld the decision, considering the existence of a dispute pending resolution by the Facilitation Council.

However, certain crucial financial account statements were not presented in the judgments, which could have affected the outcome. The case’s final resolution, whether at the current level or the Hon’ble Supreme Court, is yet to be seen.

  1. IDBI Bank Ltd vs Zee Entertainment Enterprises Limited

Citation: IDBI Bank Ltd vs. Zee Entertainment Enterprises Ltd., CP (IB) No. 107/MB-IV/2023, NCLT Mumbai Bench – IV, Decided by Mr. Prabhat Kumar, Member (Technical) and Mr. Kishore Vemulapalli, Member (Judicial)

Ratio:  A Petition under Section 7 of the IBC was denied as the amounts arose on interest payments arising from the prohibited period under Section 10A of the IBC, i.e.. during the Covid-19 Pandemic.

  1. Supreme Transport Organisation Private Limited vs Maharashtra Airport Development Company Limited

Citation: Supreme Transport Organisation Private Limited vs Maharashtra Airport Development Company Limited., C.P. No. 3688/IBC/MB/2019, NCLT Mumbai Bench – I, Decided by Mr. H.V. Subba Rao, Member (Judicial) and Ms. Anu Jagmohan Singh, Member (Technical)

Ratio: The NCLT ruled that the Earnest Money Deposit (EMD) does not fall within the definition of “operational debt” under Section 5(21) of the Insolvency and Bankruptcy Code 2016 (“Code”). The argument that EMD constitutes an advance for securing services was not accepted due to the lack of authoritative pronouncement.

Additionally, the dispute regarding the forfeited EMD was deemed a contractual dispute outside the scope of Section 9 of the Code, and the Tribunal had no jurisdiction to decide it. Consequently, the Company Petition was dismissed on both grounds.

  1. Ajay Kumar Radheyshyam Goenka v Tourism Finance Corporation of India Ltd

Citation: Ajay Kumar Radheyshyam Goenka v Tourism Finance Corporation of India Ltd., (15.03.2023 – SC): MANU/SC/0244/2023, Decided by Justice Sanjay Kishan Kaul, Justice Abhay Shreeniwas Oka and Justice J.B. Pardiwala

Ratio: In the above case, Mr. Ajay Goenka, the Managing Director of M/s Rainbow Papers Ltd., appealed for the dismissal of a case under the Negotiable Instruments Act (NI Act) initiated against him as the Director of the Company, after the company faced insolvency proceedings.

The Supreme Court ruled that the initiation of Corporate Insolvency Resolution Process (CIRP) does not automatically absolve individuals, like the Managing Director, from their criminal liabilities under the NI Act. The judgment clarifies that the IBC’s powers do not override criminal liabilities under the NI Act.

  1. Central PWD Engineers Association v. Union of India

Citation: Central PWD Engineers Association v. Union of India, W.P.(C) 11733/2019, HC of Delhi, Decided by Hon’ble Mr. Justice V. Kameswar Rao and Hon’ble Mr. Justice Anoop Kumar Mendiratta

Ratio: The primary objective of the Central Civil Services (Recognition of Service Associations) Rules, 1993 is of granting recognition to any Service Association in order to encourage legitimate union activities for enabling the negotiations by the representative body, if so required and maintenance of harmonious relationship between the government and employees. The government servants cannot be excluded from the protection of the rights guaranteed by part III (Fundamental rights) of the Constitution though the duties which they may discharge as a public servant might involve restrictions of freedom in terms of Article 19 of the Constitution of India. By virtue of Article 19(1)(c) of the Constitution of India, the right to form Association or Union or Cooperative Societies is a fundamental right even though the recognition of such Associations by the government may not be a fundamental right.

  1. Tomorrow Sales Agency Private Ltd vs SBS Holdings, INC & Ors

Citation: Tomorrow Sales Agency Private Limited vs SBS Holdings, INC & Ors., FAO(OS)(COMM) 59/2023 and CM Nos. 14793/2023 & 14794/2023, HC of Delhi, Decided by Hon’ble Mr. Justice Vibhu Bakhru and Hon’ble Mr Justice Amit Mahajan

Ratio: Third Parties to a judgment cannot enforce an arbitral award. There are no specific rules or procedures in place to award costs against third parties. If a person wished to pursue a claim against another, they were required to institute substantive action and establish the necessary averments supporting the claim.

  1. Daeyoung Jung v. Bar Council of India & Anr

Citation: Daeyoung Jung v. Bar Council of India & Anr., W.P.(C) 8015/2020 & CM APPL. 41782/2022, HC of New Delhi, Decided by Hon’ble Mr. Justice Yashwant Varma

Ratio: In the present case, the Petitioner being a foreign national from South Korea sought enrollment to the Bar Council of India and was denied on the grounds of being a non-citizen.

Held, the proviso of Section 24(1)(a) of Advocates Act explicitly allows foreign nationals to be enrolled in the bar subject to reciprocal allowance by the state of the foreign national allowing Indian citizens to enroll to their respective bar associations. If the right of the citizens of India who hold the requisite qualification to practice law in a foreign nation is preserved and no discriminatory measures adopted in the foreign nation, the nationals of the said country would clearly be entitled to seek enrolment in terms of the proviso, subject to the foreign nations meeting the qualifications. In the present case, the Petitioner was a graduate of NALSAR and was thus qualified.

Obiter: Qualifications, disqualifications and other relevant provisions propounded in various provisions of the Korean law apply equally to South Koreans as well as Indian applicants clearly eliminating the discrimination concerns. In any case, no Korean statute was shown to raise a nationality bar disentitling an Indian citizen, otherwise qualified, from pursuing the legal profession. Therefore, the absence of an explicit provision corresponding to the Proviso to Section 24, Advocates Act does not imply discriminatory provision barring Indian nationals from enrolment in South Korea.

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