right to collect the tolls let by the Corporation to the person concerned. It squarely attracts Section 2(16)(c) of the Stamp Act and partakes the character of a “Lease”.= the contract in question is a “Lease” as defined in Section 2(16)(c) of the Stamp Act and is accordingly chargeable to payment of stamp duty as per the rates prescribed in Article 35 of Schedule I of the Stamp Act as “Lease”.

 

1
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL No.3695 OF 2009
Nasiruddin & Anr. Etc. ….Appellant(s)
VERSUS
The State of Uttar Pradesh
through Secretary ….Respondent(s)
WITH
CIVIL APPEAL No.3714 OF 2009
CIVIL APPEAL No.3709 OF 2009
CIVIL APPEAL No.3705 OF 2009
CIVIL APPEAL No.3699 OF 2009
CIVIL APPEAL No.3711 OF 2009
CIVIL APPEAL No.3702 OF 2009
J U D G M E N T
Abhay Manohar Sapre, J.
1) These appeals are filed against the judgment
and order dated 22.05.2006 passed by the High
Court of Judicature at Allahabad in Civil Misc. Writ
2
Petition Nos. 9661/2005, 21327/2006,
13249/2003, 12958/2004, 26755/2004,
31238/2005, 44533/2005, 31058/2003,
22817/2006, 12957/2004 and 44532/2005
whereby the High Court dismissed the writ petitions
filed by the appellants herein.
2) In order to appreciate the short issue arising in
this bunch of appeals, it is necessary to set out few
relevant facts hereinbelow.
3) Respondent No.3 is a “Nagar Nigam Meerut”
also called “Municipal Corporation Meerut” in the
State of U.P. (hereinafter referred to as “the
Corporation”). The Corporation is constituted and
governed by the provisions of the Uttar Pradesh
Municipal Corporation Act, 1959 (for short “the
Act”). Its area of operation is in the city of Meerut.
4) In exercise of powers conferred by Section 541
(41) of the Act, the Corporation has framed Bye-laws
for implementing the provisions of the Act and for
3
regulating various activities meant essentially for
the benefit of the residents/public of Meerut city.
Clause 41 of the Bye-laws empowers the
Corporation to fix any fees for grant of any license,
sanction or permission to person(s) by and under
the Act.
5) In March 2004, the Corporation issued an
advertisement inviting bids from public at large for
letting out the right of collection of (1) realization of
Tehbazari Fee from squatters, vendors, kiosks and
(2) for collecting parking fees.
6) So far as the connecting appeals are
concerned, they pertain to other cities of U.P. but
relate to the same aforementioned activities. The
appellants participated in the public auction held by
the Corporation. Their bids were finally accepted.
7) The Corporation accordingly informed to the
appellants individually about acceptance of their
bids and entered into a formal contract with each
4
appellant to enable them to carry out the work of
collection of what is called as “Tehbazari” and
“Parking Fees” in terms of the contract. One such
contract is (Annexure P-10). The period of contract
was up to 31.03.2005.
8) The execution of contract led to the disputes
among the appellants, Corporation and the
Collector of Stamps, namely, what is the true nature
of the contract and how much stamp duty is
payable by the appellants on the contract under the
Indian Stamp Act, 1899 (for short “the Stamp Act”).
9) The Corporation, vide their letter (Annexure
P-8), requested the appellants to deposit the
requisite stamp duty payable under the Stamp Act
whereas the Collector of Stamps requested the
appellants to pay stamp duty @ Rs.70/- per
thousand on the contract amount treating the
contract as Lease.
5
10) The appellants felt aggrieved of the demand
raised by the Collector of Stamps and filed writ
petitions in the Allahabad High Court. The
Allahabad High Court placing reliance on its
previous decisions in Munindra Nath Upadhaya
vs. State of U.P. & Ors. (W.P. No.4978 of 1994)
(1995) 2 UPLBEC 1789 and Mohammad Ali vs.
Board of Revenue, U.P. (AIR 1987 Allahabad 348)
upheld the demands raised by the Collector of
Stamps and finding no fault therein dismissed the
writ petitions which has given rise to filing of these
appeals by special leave by the unsuccessful writ
petitioners in this Court.
11) Having heard the learned counsel for the
parties and on perusal of the record of the case, we
find no merit in these appeals. In our opinion, the
conclusion arrived at by the High Court in the case
of Mohammad Ali vs. Board of Revenue, U.P.
6
(supra) is just and proper calling for no interference
for the reasons given by us hereinbelow.
12) Sections 2(12), 2(14), 2(16) and Article 35 of
Schedule I to the Stamp Act are relevant for
deciding the question arising in the case. They read
as under:
“2(12) “Executed” and “execution”, used with
reference to instruments, mean “signed” and
“signature”.
2(14) “Instrument” includes every document
by which any right or liability is, or purports
to be, created, transferred, limited, extended,
extinguished or recorded.
2(16) “Lease” means a lease of immovable
property, and includes also –
(a) a patta;
(b) a Kabuliyat or other undertaking in
writing, not being a counterpart of a lease, to
cultivate, occupy, or pay or deliver rent for,
immovable property;
(c) any instrument by which tolls of any
description are let;
(d) any writing on an application for a
lease intended to signify that the application
is granted;
7
Article 35 of Schedule 1.
Description of
Instrument
Proper Stamp-duty
LEASE, including an
under-lease or sub-lease
and any agreement to let
or sub-let
(a) where by such lease
the rent is fixed and no
premium is paid or
delivered—
(i) where the
lease purports
to be for a
term of less
than one year;
(ii) where the
lease purports
to be for a
term of not
less than one
year but not
more than
three years;
(iii) where the
lease purports
to be for a
term in excess
of three years;
(iv) where the
lease does not
purport to be
for any
definite term;
The same duty as a
Bond (No.15) for the
whole amount payable
or deliverable under
such lease.
The same duty as Bond
(No. 15) for the
amount or value of the
average annual rent
reserved.
The same duty as a
Conveyance (No. 23)
for a consideration
equal to the amount or
value of the average
annual rent reserved.
The same duty as a
Conveyance (No.23)
for a consideration
equal to the amount or
value of the average
annual rent which
would be paid or
delivered for the first
ten years if the lease
continued so long.
8
(v) where the
lease purports
to be in
perpetuity.
(b) where the lease is
granted for a fine or
premium or for money
advanced and where
no rent is reserved.
(c) where the lease is
granted for a fine or
premium or for money
advanced in addition to
rent reserved.
Exemptions
(a) Lease, executed in
The same duty as a
Conveyance (No. 23)
for a consideration
equal to one-fifth of
the whole amount of
rents which would be
paid or delivered in
respect of the first fifty
years of the lease.
The same duty as a
Conveyance (No. 23)
for a consideration
equal to the amount or
value of such fine or
premium or advance
as set forth in the
lease.
The same duty as a
Conveyance (No. 23)
for a consideration
equal to the amount or
value of such fine or
premium or advance
as set forth in the
lease, in addition to
the duty which would
have been payable on
such lease if no fine or
premium or advance
had been paid or
delivered:
Provided that, in any
case when an
agreement to lease is
stamped with the ad
valorem stamp
required for a lease,
and a lease in
pursuance of such
agreement is
9
the case of a cultivator
and for the purposes of
cultivation (including a
lease of trees for the
production of food or
drink) without the
payment or delivery of
any fine or premium,
when a definite term is
expressed and such
term does not exceed
one year, or when the
average annual rent
reserved does not
exceed one hundred
rupees.
subsequently
executed, the duty on
such lease shall not
exceed eight annas.
13) The expression “Lease” defined in Section
2(16) clause (c) shows that it also includes therein
“any instrument by which tolls of any description are
let”.
14) Similarly the expression “executed” and
“execution” with reference to any instrument, as
defined in Section 2(12) of the Stamp Act, means
“signed” and “signature”.
15) Likewise the expression “Instrument” defined
in Section 2(14) shows that it includes therein every
document by which any right or liability is, or
10
purports to be created, transferred, limited,
extended, extinguished or recorded.
16) In our considered opinion, reading of the
contract in question would show that it was meant
to collect tolls (fees) called “Tehbazari” in local
parlance from squatters, venders, kiosks etc. and
was for collecting parking fees. Such contract, in
our view, is regarded as an instrument by which
tolls of any description are let. In other words, by
awarding such contract to the appellants, the
Corporation had let their right to the appellants to
collect the fees from a class of persons and for
carrying on particular activity in the city.
17) The expression “Lease” under the Stamp Act
has a wider meaning as compared to its original
meaning contained in Section 105 of Transfer of
Property Act (for short “the T.P. Act”). If “Lease”
under Section 2(16) of the Stamp Act includes
therein four specified category of documents set out
11
in clauses (a) to (d), we do not find any such
inclusion in Section 105 of the Transfer of Property
Act. It is for this reason, we are of the view that the
definition of “Lease” for the purpose of Stamp Act is
extensive in nature. It is also clear from the use of
the expression “and includes also” in Section 2 (16)
of the Stamp Act.
18) So by fiction, “any instrument by which tolls of
any description are let” is considered as “Lease” for
the purpose of payment of stamp duty under the
Stamp Act.
19) Justice G.P. Singh, the learned author in his
book “Principles of Statutory Interpretation” in
13th edition – at pages 179 and 180 has dealt with
this subject under the heading “Definition sections
or interpretation clause”. In its sub-heading (a)
“Restrictive and extensive definition”, the author
has explained as to where the words “mean”,
“include”, “includes”, and “means and includes” are
12
used in any definition clause in the Act then how
such definition should be interpreted. The following
passage is apposite to quote.
“(a) Restrictive and extensive definitions
The Legislature has power to define a word
even artificially. So the definition of a word
in the definition section may either be
restrictive of its ordinary meaning or it may
be extensive of the same. When a word is
defined to ‘mean’ such and such, the
definition is prima facie restrictive and
exhaustive; whereas, where the word defined
is declared to ‘include’ such and such, the
definition is prima facie extensive. When by
an amending Act, the word ‘includes’ was
substituted for the word ‘means’ in a
definition section, it was held that the
intention was to make it more extensive.
Further, a definition may be in the form of
‘means and includes’, where again the
definition is exhaustive, on the other hand, if
a word is defined ‘to apply to and include’,
the definition is understood as extensive.
These meanings of the expressions ‘means’,
‘includes’ and ‘means and includes’ have
been reiterated in Delhi Development
Authority vs. Bhola Nath Sharma, (2011) 2
SCC 54. The use of word ‘any’ e.g. any
building also connotes extension for ‘any’ is a
word of very wide meaning and prima facie
the use of it excludes limitation.”
20) In our opinion, the aforesaid rule of
interpretation applies while interpreting the
13
definition of Lease under Section 2(16) of the Stamp
Act.
21) As mentioned above, the Corporation in these
cases awarded the contract to the appellants to
recover the tolls (fees) from squatters, vendors,
kiosks etc. and for parking the vehicles in specified
places. The contract was, therefore, for recovery of
tolls and created rights and liabilities in favour of
contracting parties qua each other. It cannot be
disputed that the expression “tolls of any
description” in clause (c) would include all kinds of
levy, charges, fees etc. which the Corporation is
entitled to charge under its Bye-laws (41). A fortiori,
the fees in question would also fall under Section
2(16)(c) of the Stamp Act.
22) In our opinion, the contract in question also
satisfied the definition of the expression
“Instrument” as defined in Section 2(14) of the
Stamp Act because it created a right and liability
14
and lastly, it also satisfied the definition of
expression “executed” and “execution” as defined in
Section 2 (12) of the Stamp Act because it contained
the signature of contracting parties.
23) Learned counsel for the appellants, however,
placed reliance on the decision of this Court in New
Bus-Stand Shop Owners Association vs.
Corporaton of Kozhikode & Anr. [2009 (10) SCC
455] and contended that in the light of the law laid
down in the case of New Bus-stand Shop Owners
Association (supra), the contract in question has
characteristics of a “license” but not of a “lease”
and, therefore, the contract would attract a stamp
duty payable on a License Deed under the Stamp
Act.
24) In our view, the law laid down in the case of
New Bus-stand Shop Owners Association (supra)
is not applicable to the case at hand and is
distinguishable on facts.
15
25) In the case of New Bus-stand Shop Owners
Association (supra), the Corporation of Kozhikode
had let out their shops to several persons and
executed agreement in their favour. The question,
however, arose as to the true nature of the
agreement, whether it is a “license agreement” or a
“lease agreement”. Their Lordships on construction
of the terms of agreement held that the agreement
was a license and accordingly chargeable to stamp
duty as “License” under the Kerala Stamp Act.
26) Such is not the case here. The case at hand
relates to the right to collect the tolls let by the
Corporation to the person concerned. It squarely
attracts Section 2(16)(c) of the Stamp Act and
partakes the character of a “Lease”.
27) In the light of foregoing discussion, we are of
the considered opinion that the contract in question
is a “Lease” as defined in Section 2(16)(c) of the
Stamp Act and is accordingly chargeable to payment
16
of stamp duty as per the rates prescribed in Article
35 of Schedule I of the Stamp Act as “Lease”. The
conclusion arrived at by the Single Judge in
Mohammad Ali vs. Board of Revenue, U.P. (supra)
is, therefore, correct which we support with our
reasoning given supra.
28) In view of foregoing discussion, the appeals are
found to be devoid of any merit. They are
accordingly dismissed.
……………………………………….J.
[ABHAY MANOHAR SAPRE]
……………………………………..J.
[NAVIN SINHA]
New Delhi;
December 06, 2017

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no habeas corpus against biological father – The appellant being the biological father of Aadvik, his custody of the child can by no means in law be construed as illegal or unlawful drawing the invocation of a superior Court’s jurisdiction to issue a writ in the nature of habeas corpus.=The children are US citizens by birth. Noticeably, the child Aadvik, who is the subject matter of the lis and custody was barely 2½ years old when he came over to India and had stayed here since then . Considering his infant years of stay in US, we construe it to be too little for the required integration of his with the social, physical, psychological, cultural and academic environment of US to get totally upturned by his transition to this country, so much so that unless he is immediately repatriated, his inherent potentials and faculties would suffer an immeasurable set back. The respondent-mother also is not favourably disposed to return to India, she being a working lady in US and is also disinclined to restore her matrimonial home. The younger son is with her. There is no convincing material on record that the continuation of the child in the company and custody of the appellant in India would be irreparably prejudicial to him..- – Having regard to the nature of the proceedings before the US Court, the intervening developments thereafter and most importantly the prevailing state of affairs, we are of the opinion that the child, till he attains majority, ought to continue in the custody, charge and care of the appellant, subject to any order to the contrary, if passed by a court of competent jurisdiction in an appropriate proceeding deciding the issue of its custody in accordance with law.

 

1
REPORTABLE
IN THE SUPREME COURT OF INDIA
CRIMINAL APPELLATE JURISDICITON
CRIMINAL APPEAL NO. 968 OF 2017
PRATEEK GUPTA ….APPELLANT
versus
SHILPI GUPTA & ORS. ….RESPONDENTS
J U D G M E N T
AMITAVA ROY, J.
1. By the impugned judgment and order dated 29.04.2016 rendered
by the High Court of Delhi, in a writ petition filed by the respondent
No.1 seeking a writ in the nature of habeas corpus, the
appellant-father has been directed to hand over the custody of the
child, Master Aadvik, aged about 5 years to respondent No.1-
mother. The appellant-father is in assailment of this determination
and seeks the remedial intervention of this Court. By order dated
03.05.2016, the operation of the impugned verdict was stayed and
as the said arrangement was continued thereafter from time to
time, the custody of the child as on date has remained with the
appellant. The orders passed by this Court though attest its
earnest endeavour to secure a reconciliation through interactions
with the parents and the child, the efforts having failed, the appeal
2
is being disposed of on merits.
2. We have heard Ms. Binu Tamta, learned counsel for the appellant
and Mr. N.S. Dalal, learned counsel for the respondent No. 1
(hereafter to be referred to as “respondent”).
3. A skeletal outline of the factual backdrop is essential. The
appellant and the respondent who married on 20.01.2010 in
accordance with the Hindu rites at New Delhi had shifted to the
United States of America (for short, hereafter referred to as ‘U.S.’),
as the appellant was already residing and gainfully employed there
prior to the nuptial alliance. In due course, the couple was blessed
with two sons, the elder being Aadvik born on 28.09.2012 and the
younger, Samath born on 10.09.2014. As adverted to hereinabove,
the present lis is with regard to the custody of Master Aadvik,
stemming from an application under Article 226 of the Constitution
of India filed by the respondent alleging illegal and unlawful
keeping of him by the appellant and that too in violation of the
orders passed by the Juvenile and Domestic Relations Court of
Fairfax County, passed on 28.05.2015 and 20.10.2015 directing
him to return the child to the Commonwealth of Virginia and to the
custody and control of the respondent.
4. The pleaded facts reveal that the child resided with the parents
from his birth till 07.11.2014 and thereafter from 07.11.2014 till
3
06.03.2015 with the respondent-mother in the United States. This
is so, as in view of irreconcilable marital issues, as alleged by the
respondent, particularly due to the volatile temperament and
regular angry outbursts of the appellant often in front of the child,
the parties separated on or about 15.11.2014. Prior thereto, the
appellant had on 08.11.2014 left for India leaving behind the
respondent and her children in U.S. He returned on 18.01.2015 to
the U.S., but the parties continued to live separately, the
respondent with her children. The appellant however, made short
time visits in between and on one such occasion i.e. on 24.01.2015,
he took along with him Aadvik, representing that he would take him
for a short while to the Dulles Mall. According to the respondent,
she did not suspect any foul play and permitted the child to
accompany his father, but to her dismay though assured, the
appellant did not return with the child in spite of fervent insistences
and implorations of the mother. As alleged by the respondent, the
appellant thus separated the child from her from 24.01.2015 to
07.03.2015 in a pretentious and cruel move, seemingly acting on a
nefarious strategy which surfaced when on 07.03.2015, the
appellant left U.S. with the child to India without any prior
information or permission or consent of hers.
5. Situated thus, the respondent approached Juvenile and Domestic
4
Relations Court Fairfax County, for its intervention and for that, on
15.05.2015, she filed “Emergency Motion For Return of Minor Child
and Established Temporary Custody”.
6. On the next date fixed i.e. 19.05.2015, after the service of the
process on the appellant, his counsel made a “special appearance”
to contest the service. On the date thereafter i.e. 28.05.2015, he
however informed the court that he was not contesting the service
upon the appellant, whereupon hearing the counsel for the parties
at length and also noticing the plea on behalf of the appellant that
he intended to return with the child in U.S. and that the delay was
because of his mother’s illness, the U.S. Court passed the following
order:
“IN THE JUVENILE & DOMESTIC RELATIONS DISTRICT
COURT FOR FAIRFAX COUNTRY
SHILPI GUPTA IN re: Aadvik Gupta
D.O.B. September 28, 2012
Petitioner
Case No. JJ 431468-01-00
Vs.
Prateek Gupta
Respondent
ORDER
This cause came before this Court on the 19th May,
2015, upon the petitioner Shilpi Gupta’s verified motion for
return of minor child and to establish temporary custody;
It appearing to the Court that this Court has proper
jurisdiction over the parties to this action pursuant to the
Uniform Child Custody Jurisdiction and Enforcement Act,
more specifically 20-146.24 and 20-146.32 of the Code of
5
Virginia, 1950, as amended.
It further appearing to the Court that it is in the best
interest of the child, Aadvik Gupta, (hereinafter “Aadvik”)
born on September 28, 2012, that he be immediately
returned to the custody of the petitioner and to the
Commonwealth of Virginia pending any further order of
this Court and that good cause exists with which to require
that the petitioner take immediate possession of the child
by all means necessary. It is therefore adjourned and
ordered as follows:
1. Custody: The petitioner Shilpi Gupta, is hereby granted
sole legal and physical custody of the minor child, Aadvik
Gupta, pending further order of this Court.
2. Return of the Child: That the respondent, Prateek
Gupta, is hereby ordered to immediately return Aadvik to
the Commonwealth of Virginia, and to the custody and
control of the petitioner or her agents. Thereafter, the
respondent shall not remove the child from the
Commonwealth of Virginia under any circumstances
without further order of the Court.
3. Enforcement: That the all law enforcement agencies
and related agencies (including but not limited to Police
Department(s), Sheriff’s Department(s), U.S. State
Department, Federal Bureau of Investigations) are hereby
directed to assist and/or facilitate the transfer of Aadvik to
the petitioner, if necessary, including taking the child into
custody from anyone who has possession of him and
placing him in the physical custody of the petitioner.
4. Passport: That once the child has been returned to
Virginia, any and all of Aadvik’s passports must be
immediately surrendered to the petitioner where it will be
held until further order of this Court.
5. Removal from the Commonwealth of Virginia: That all
relevant and/or local law enforcement agencies shall do
whatever possible to prevent the removal of Aadvik Gupta,
from the Commonwealth of Virginia except at the direction
of the petitioner, Shilpi Gupta.
And this cause is continued.
Entered this 28 day of May, 2015.
Sd/-
Judge”
6
7. Thereby, the Court in U.S. being satisfied that it had the proper
jurisdiction over the parties to the action before it and also being of
the opinion that it was in the best interest of the child, that he be
returned to the custody of the respondent and to the
Commonwealth of Virginia pending further orders, and that being
convinced that good cause existed to require that the
respondent-mother take immediate possession of the child by all
means necessary, granted sole legal and physical custody of the
child to the respondent pending further orders of the Court. The
appellant was directed to immediately return the child to the
Commonwealth of Virginia and to the custody and control of the
respondent or her agents with a further restraint on him not to
remove the child from the Commonwealth of Virginia under any
circumstance without the further order of the Court. Thereby, all
law enforcement and related agencies as mentioned in the order
were directed to assist and/or facilitate the transfer of the child to
the respondent, if necessary by taking the child into custody from
anyone who had his possession and by placing him in the physical
custody of the respondent.
8. As the records laid before this Court would divulge, the appellant
meanwhile on 26.05.2015 filed a petition for restitution of conjugal
rights under Section 9 of the Hindu Marriage Act, 1956 (as
7
amended) and also a petition under Section 7(b) of the Guardian
and Wards Act, 1890 in the court of the Principal Judge, Family
Court, Rohini, Delhi seeking a decree for restitution of conjugal
rights between the parties and for a declaration that he was the sole
and permanent guardian of the child, respectively. Subsequent
thereto on 26.08.2015 he also instituted a suit in the High Court of
Delhi at New Delhi praying for a decree inter alia to adjudge the
proceedings initiated by the respondent in the court in U.S. to be
false, malicious, vexatious, oppressive and nullis juris, being
without jurisdiction and also to declare the order dated 28.05.2015
with regard to the return of the child to the custody of the
respondent-mother to be also null and void and not binding on him.
A decree for permanent injunction against the respondent, her
agents etc. from pursuing her proceedings before the court in U.S.
was also sought for. The orders, if any, passed in these proceedings
instituted by the appellant having a bearing on those pursued by
the respondent before the court in U.S. are however not on record
and we therefore refrain from making any comment thereon.
Suffice is to state that the lodging of the proceedings by the
appellant in courts in India demonstrates in unambiguous terms,
his knowledge about the lis in the Court in U.S. and the order dated
28.08.2015, interim though, directing him to return the custody of
8
the child immediately to the respondent-mother and to the
Commonwealth of Virginia, pending further orders.
9. Be that as it may, the court in U.S. on 20.10.2015 noticing inter
alia that the appellant had refused to return the child to the U.S.
and to the custody of the respondent in direct violation of its earlier
order dated 28.05.2015, ordered that the respondent be granted
sole, legal and physical custody of the child and also declared that
no visitation be granted to the appellant. It was further directed
that if either party intended to relocate his or her residence, he/she
would have to give 30 days’ advance written notice of any such
intended relocation and of any intended change in address to the
other party and the court. The proceedings concluded with the
observation “This cause is final”. For immediate reference
the proceedings of 20.10.2015 is also extracted hereinbelow:
“IN THE JUVENILE & DOMESTIC RELATIONS
DISTRICT COURT FOR FAIRFAX COUNTY
Shilpi Gupta In re: Aadvik Gupta
D.O.B. September 28, 2012
Petitioner
Case No. JJ431468-01-00/02-00
Vs.
Prateek Gupta
Respondent
9
CUSTODY AND VISITATION ORDER
This cause came before this Court on the 20th day of
October, 2015, upon the petitioner Shilpi Gupta’s
petitions for custody and visitation of Aadvik Gupta.
It appearing to the Court that it has jurisdiction
over the parties and the subject matter of the
above-styled matter;
It further appearing to the Court that the
respondent, Prateek Gupta, unilaterally removed
Aadvik Gupta to India without notice to or consent of
the petitioner, and has further refused to return said
child to the United States and into the custody of the
petitioner in direct violation of this Court’s order
entered on May 28, 2015.
Having considered all of the factors of 20-124.3 of
the Code of Virginia, 1950, as amended, it is hereby:
Adjudged and ordered that petitioner is granted sole
legal and physical custody of Aadvik Gupta; it is
further.
Adjudged and ordered that no visitation is granted
to the respondent at this time; and it is further;
Adjudged and ordered that pursuant to 20-124.5 of
the Code of Virginia, 1950 as amended, either party
who intends to relocate his or her residence shall give
thirty-days advance written notice of any such
intended relocation and of any intended change of
address, said notice being given to both the other
party and to this Court.
This cause is final
Entered this 20th day of October, 2015.”
10.Mentionably, before the order dated 20.10.2015 was passed, the
respondent in the face of deliberate non-compliance of the order
dated 28.05.2015 of the court in U.S. had filed a contempt petition
before it and the copy thereof was served on the appellant asking
him to show cause. It is also a matter of record that the order
dated 28.05.2015 of the court in U.S. had been published in the
10
daily “The Washington Times” on 03.09.2015, whereafter the order
dated 20.10.2015 was passed in the presence of the counsel for the
appellant after affording the respondent due hearing, whereupon
the counsel of the appellant signed the order with the following
endorsement “objected to for returning the child to mother sole legal
and physical custody”. The proceedings of the order dated
20.10.2015 would also testify that he failed to appear even after
personal service. That the notice of the proceedings in U.S. Court
at both the stages had been served on the appellant is a minuted
fact. It was in this eventful backdrop, that the respondent invoked
the writ jurisdiction of the High Court of Delhi seeking a writ of
habeas corpus against the appellant for the custody of the child
alleging its illegal and unlawful charge by him.
11. In reinforcement of her imputations, the respondent elaborated that
the child was an American citizen by birth, Virginia being his home
State and that in spite of the order(s) of a court of competent
jurisdiction, the appellant had illegally detained him. Various
correspondences made by her with different authorities seeking
their intervention and assistance as the last resort before
approaching the Writ Court were highlighted.
12.In refutation, it was pleaded on behalf of the appellant that the
petition for a writ in the nature of habeas corpus was misconceived
11
in absence of any imminent danger of the life or physical or moral
well-being of the child. Referring to, amongst others the proceedings
initiated by him under the Guardian and Wards Act, 1890 which
was pending adjudication, it was asserted on his behalf that as the
same assured effective and efficacious remedy in law, the prayer in
the writ petition ought to be declined. It was insisted as well that
as the issue of the custody of the child was involved, a summary
adjudication thereof was unmerited and that a proper trial was the
imperative. Apart from referring to the reasons for the acrimonious
orientation of the parties, the initiatives and efforts made by him
and his family members to fruitlessly effect a resolution of the
differences, were underlined. It was maintained on his behalf that
the parties however, as an interim arrangement made on
24.01.2015 had agreed to live separately with each parent keeping
one child in his/her custody and that in terms thereof Aadvik, the
minor whose custody is in dispute, was given in charge of the
appellant. Institution and pendency of the other proceedings before
the Indian Courts were also cited to oppose the relief of the writ of
habeas corpus. It was contended as well that the respondent being
a single working woman, she would not, in any view of the matter,
be capable of appropriately looking after both the children.
13.In rejoinder, it was asserted on behalf of the respondent that the
12
proceedings instituted by the appellant were all subsequent to the
one commenced by her in the court in U.S. on 15.05.2015 and in
the face of the final order(s) passed, directing return of custody of
the child to her and the Commonwealth of Virginia, the continuance
of the child with the appellant was apparently illegal and
unauthorized, warranting the grant of writ of habeas corpus.
14.The High Court, as the impugned judgment would evince, after
traversing the recorded facts, amongst others took note of the
disinclination of the respondent-wife to join the company of her
husband in India because of his alleged past conduct and the
trauma and torture suffered by her, a plea duly endorsed by her
father present in court, granted the writ as prayed for. While
rejecting the contention of the appellant that no orders ought to be
passed in the writ petition in view of the pendency of the three
proceedings initiated by him in India, the High Court seemed to
place a decisive reliance on the decision of this Court in Surya
Vadanan vs. State of Tamil Nadu & Ors.,
1
and after subscribing
to the principle of “comity of courts” and the doctrines of “most
intimate contact” and “closest concern” returned the finding, in the
prevailing factual setting, that the domestic court had much less
concern with the child as against the foreign court which had
1 (2015) 5 SCC 450
13
passed the order prior in time. It observed further that no special or
compelling reason had been urged to ignore the principle of comity
of courts which predicated due deference to the orders passed by
the U.S. Court, more particularly when the appellant was
represented before it through his counsel and had submitted to its
jurisdiction. It was held that as the child remained in the U.S.
since birth upto March, 2015, it could be safely construed that he
was accustomed to and had adapted himself to the social and
cultural milieu different from that of India. It was observed that no
plea had been raised on behalf of the appellant that the foreign
court was either incompetent or incapable of exercising its
jurisdiction or had not rendered a reasonable or fair decision in the
best interest of child and his best welfare. In the textual facts, the
conclusion of the High Court was that the most intimate contact
with the parties and their children was of the court in U.S. which
did have the closest concern for their well-being.
15.Having determined thus, the High Court directed the appellant to
produce the child in court on the date fixed for consequential
handing over of his custody to the respondent.
16.In the process of impeachment of the impugned ruling of the High
Court, the learned counsel for the appellant at the threshold has
assiduously questioned the maintainability of the writ proceeding
14
for habeas corpus. According to the learned counsel, in the
attendant facts and circumstances, the custody of the child of the
appellant who is the biological father can by no means be construed
as illegal or unlawful and thus the writ proceeding is misconceived.
Further the appellant being in-charge of the child on the basis of an
agreement between the parties, which also stands corroborated by
various SMS and e-mails exchanged between them during the
period from January, 2015 to 07.03.2015, the departure of the
appellant with the child from the U.S. to India and its custody with
him is authorized and approved in law. The learned counsel argued
as well that during the interregnum, after the appellant had
returned to India with the child, the couple had been in touch with
each other with interactions about the well-being of the child and
thus in law and on facts, there is no cause of action whatsoever for
the writ of habeas corpus as prayed for. That in passing the
impugned order, the High Court had visibly omitted to analyze the
perspectives pertinent for evaluating the interest or welfare of the
child has been underlined to urge that on that ground alone, the
assailed ruling is liable to be interfered with. The learned counsel
dismissed any binding effect of the order of the U.S. Court on the
ground that the same had been obtained by the respondent by
resorting to fraud in withholding the relevant facts from it and
15
deliberately projecting wrongly that the safety of the child was in
danger in the custody of the appellant. The order of the court in
U.S. having thus been obtained by resorting to fraud, it is non est in
law, she urged. Even otherwise, India being not a signatory to the
Hague Convention of “The Civil Aspects of International Child
Abduction”, the order of the U.S. Court was not per se enforceable
qua the appellant and as in any view of the matter, the principle of
comity of courts was subject to the paramount interest and welfare
of the child, the High Court had fallen in error in relying on the
rendition of this Court in Surya Vardanan1
which in any event,
was of no avail to the respondent in the singular facts of the case.
According to the learned counsel, the parties are Indian nationals
and citizens having Indian passports and they are only residents of
U.S. on temporary work visa. It has been argued that the
respondent is all alone in U.S. with the younger child on a
temporary work visa which would expire in 2017 and her parents
and other family members are all in India. It has been pleaded as
well that when the child was brought to India by the appellant, he
was aged 2½ years, by which age he could not be considered to
have been accustomed and adapted to the lifestyle in U.S. for the
application of the doctrines of “intimate contact” and “closest
concern” by a court of that country. According to the learned
16
counsel, the child after his return to India, has been admitted to a
reputed school and has accustomed himself to a desired congenial
family environment, informed with love and affection, amongst
others of his grand-parents for which it would be extremely harsh to
extricate him herefrom and lodge him in an alien setting, thus
adversely impacting upon the process of his overall grooming. That
the removal of the child by the appellant to India had not been in
defiance of any order of the court in U.S. and that the issue, more
particularly with regard to his custody as per the Indian law is
presently pending in a validly instituted proceeding here has also
been highlighted in endorsement of the challenge to the impugned
judgment and order. The decisions of this Court in Dhanwanti
Joshi vs. Madhav Unde2
, Sarita Sharma vs. Sushil Sharma3
and
Surya Vadanan1 have been adverted to in consolidation of the
above arguments.
17.In his contrasting response, the learned counsel for the respondent,
while edifying the sanctified status of a mother and her revered role
qua her child in its all round development, urged with reference to
the factual background in which the child had been removed from
his native country, that his continuing custody with the appellant is
patently illegal and unauthorized besides being ruthless and
2 (1998) 1 SCC 112
3 (2000) 3 SCC 14
17
inconsiderate vis-à-vis the respondent-mother and his younger
sibling. Heavily relying on the determination of this Court in Surya
Vadanan1
, the learned counsel has insisted that the High Court
had rightly invoked the principle of comity of courts and the
doctrines of “intimate contact” and “closest concern” and therefore,
no interference is called for in the ultimate interest and well-being
of the child. It was urged that the orders passed by the court in U.S.
directing the return of the child to the custody of the respondent
and the Commonwealth of Virginia is perfectly legal and valid, the
same having been rendered after affording due opportunity to the
appellant and also on an adequate appreciation of the aspects
bearing on the welfare of the child. The orders thus being binding
on the appellant, the defiance thereof is inexcusable in law and only
displays a conduct unbecoming of a father to justify retention of the
custody of the child in disobedience of the process of law. The High
Court as well on a due consideration of the facts and the law
involved had issued its writ for return of the custody of the child to
the respondent after affording a full-fledged hearing to both the
parties for which no interference is warranted, he urged. The
learned counsel however denied that there was ever any agreement
or understanding between the couple, under which they agreed that
each parent would have the custody of one child as represented by
18
the appellant. In the case in hand as a final order has been passed
by the court in U.S. with regard to the custody of the child in favour
of the respondent after discussing all relevant aspects, the
impugned order of the High Court being in conformance with the
letter and spirit thereof, no interference is merited, he urged. While
placing heavy reliance on the decision of this Court in Surya
Vadanan1 , it was also insisted that the return of the elder child to
the custody of the mother was indispensably essential also for the
proper growth and grooming of the younger child in his company
and association, sharing the common bond of love, affection and
concern.
18.The recorded facts and the contentious assertions have received our
due attention. A brief recapitulation of the state of law on the issue
at the outset is the desideratum.
19. A three Judge Bench of this Court in Nithya Anand Raghavan
vs. State (NCT of Delhi) and another4
did have the occasion to
exhaustively revisit the legal postulations qua the repatriation of a
minor child removed by one of the parents from the custody of the
other parent from a foreign country to India and its retention in the
face of an order of a competent foreign court directing its return to the
place of abode from which it had been displaced. The appeal before
4 (2017) 8 SCC 454
19
this Court arose from a decision of the High Court in a Writ Petition
filed by the father alleging that the minor daughter of the parties had
been illegally removed from his custody in United Kingdom (for short,
hereafter referred to as “UK”), thus seeking a writ of habeas corpus for
her production. By the verdict impugned, the High Court directed the
appellant-mother therein to produce the minor child and to comply
with an earlier order passed by the High Court of Justice, Family
Division, Principal Registry, United Kingdom within three weeks or in
the alternative to handover the custody of the daughter to the
respondent-father therein within that time. The proceeding in which
the Court in the UK had passed the order dated 08.01.2016 had been
initiated by the respondent/father after the appellant/mother had
returned to India with the minor.
20. A brief outline of the factual details, would assist better the
comprehension of the issues addressed therein. The parties to start
with, were Indian citizens and were married as per the Hindu rites and
customs on 30.11.2006 which was registered before the SDM Court,
Chennai, whereafter on the completion of the traditional formalities,
they shifted to U.K. in early 2007 and set up their matrimonial home
in Watford (U.K.). Differences surfaced between them so much so that
as alleged by the wife, she was subjected to physical and mental
abuse. She having conceived in and around December, 2008, left U.K.
20
for Delhi in June, 2009 to be with her parents and eventually was
blessed with a girl child, Nethra in Delhi. The husband soon joined
the mother and the child in Delhi whereafter, they together left for
U.K. in March, 2010. Skipping over the intervening developments,
suffice it to state that the mother with the child who had meanwhile
been back on a visit to India, returned to London in December, 2011,
whereafter the minor was admitted in a Nursery School in U.K. in
January, 2012. In December, 2012, the daughter was granted
citizenship of U.K. and subsequent thereto, the husband also acquired
the same. Meanwhile from late 2014 till early 2015, the daughter was
taken ill and was diagnosed to be suffering from cardiac disorder for
which she was required to undergo periodical medical reviews. As
imputed by the wife, the father however, dis-played total indifference
to the daughter’s health condition. Finally on 02.07.2015, the
appellant-mother returned to India along with the daughter because of
alleged violent behavior of the respondent and also informed the
school that the ward would not be returning to U.K. for her well-being
and safety.
The appellant thereafter filed a complaint on 16.12.2015 against
the respondent with the Crime Against Women Cell, New Delhi, which
issued notice to the respondent and his parents to appear before it.
According to the appellant, neither the respondent nor his parents did
21
respond to the said notice and instead as a counter-blast, he filed a
custody/wardship petition on 08.01.2006 before the High Court of
Justice, Family Division, U.K. praying for the restoration of his
daughter to the jurisdiction of that Court. The Court in U.K. on
08.01.2016 passed an ex-parte order inter alia directing the appellant
to return the daughter to U.K. and to attend the hearing of the
proceedings. Within a fortnight therefrom, the respondent also filed a
writ petition before the High Court of Delhi against the appellant-wife
seeking a writ of habeas corpus for production of the minor before the
Court. By the impugned Judgment and Order, the High Court
directed the appellant to produce the daughter and comply with the
orders passed by the U.K. Court or hand over the minor to the
respondent-father within three weeks therefrom.
Assailing this determination, it was urged on behalf of the
appellant inter alia that the High Court had wrongly assigned
emphasis on the principle of comity of courts in complete disregard of
the paramount interest and welfare of the child, more particularly in
view of the vicious environment at her matrimonial home in U.K. in
which she (appellant) had been subjected to physical and verbal abuse
and had even placed the child at risk with his behaviour. The fact
that India not being a signatory to the Hague Convention intended to
prevent parents from abducting children across the borders, the
22
principle of comity of courts did not merit precedence over the welfare
of the child, an aspect overlooked by the High Court, was underlined.
It was asserted that the impugned order did also disregard the parens
patriae jurisdiction of the Indian court within whose jurisdiction the
child was located as well as the welfare of the child in question in
mechanically applying the principle of comity of courts. That though
the welfare of the child in situations of the like as well, is of
paramount consideration, this Court in Shilpa Aggarwal vs. Aviral
Mittal and another5
and in Surya Vadanan1
had deviated from this
governing precept and had directed the child and mother to return to
the jurisdiction of the foreign court by mis-interpreting the concept of
‘intimate contact’ of the child with the place of repatriation, was
highlighted for reconsideration of the views expressed therein. It was
urged that the decision in Surya Vadanan1 had a chilling effect of
assigning dominance to the principle of comity of courts over the
welfare of a child, which mentionably undermined the perspective of
the child, thus encouraging multiplicity of proceedings
It was insistingly canvassed that the view adopted in Surya
Vadanan1 was in direct conflict with an earlier binding decision in V.
Ravi Chandran (Dr.) vs. Union of India and others6
in which a
three-Judge Bench had categorically held that under no circumstance
5 (2010)1 SCC 591
6 (2010) 1 SCC 174
23
can the principle of welfare of the child be eroded and that a child can
seek refuge under the parens patriae jurisdiction of the Court. While
dismissing the initiative of the respondent before the UK Court to be
one in retaliation of the appellant’s allegation of abuse and violence
and noticeably after she had filed a complaint with the Crime Against
Women Cell (CAWC), New Delhi, it was also urged that the U.K. Court
had passed ex parte order without affording any opportunity to her to
present her case. It was canvassed further that the writ petition filed
by the respondent seeking a writ of habeas corpus which is envisaged
for urgent and immediate relief was also a designed stratagem of his
bordering on the abuse of the process of the court and thus ought to
have been discouraged by the High Court. It was underlined as well
that the High Court in passing the impugned direction had also
overlooked that the respondent had defaulted in the discharge of his
parental duty towards the child, who was suffering from serious
health problems, thus compromising in all respects the supervening
consideration of overall well-being of the child.
In refutation, it was maintained on behalf of the respondent that
the child was a British citizen and brought up in U.K. and as he had
acquired its citizenship and the appellant was also a permanent
resident of U.K., they had the abiding intention to permanently settle
there along with the child and thus the U.K. Court had the closest
24
concern and intimate contact with the child as regards her welfare and
custody and thus indubitably had the jurisdiction in the matter. It was
urged on behalf of the respondent by referring amongst others to the
rendering in Surya Vadanan1
that the child had clearly adapted to
the social and cultural milieu of U.K. and thus it was in its best
interest to be rehabilitated there. That there was no material to
suggest that the return of the child to U.K. would result in
psychological, physical or cultural harm to her or that the U.K. Court
was incompetent to take a decision in the interest and welfare of the
child, was underlined. It was insisted as well that there was no
compelling reason for the High Court to ignore the principle of comity
of courts and that as acknowledged by the High Court, better medical
facilities were available in U.K. to treat the child. The steps taken by
the respondent towards the child’s boarding and travelling expenses
together with the expenditure incurrable for the school and other
incidental aspects and his undertaking not to pursue any criminal
proceeding against the appellant for kidnapping the child with the
avowed desire of reinstating his home was highlighted to demonstrate
his bona fides. That there was no delay on the part of the respondent
in filing the writ petition, which he did immediately after coming to
learn that the appellant was disinclined to return the child to U.K.,
was stressed upon as well.
25
In this disputatious orientation, this Court premised its
adjudication on the necessity to comply with the direction issued by
the foreign court against the appellant to produce the minor child
before the U.K. Court where the issue regarding wardship was pending
for consideration and also to ascertain as to which Court could
adjudicate the same.
While recalling that the concept of forum convenience has no
place is wardship jurisdiction, this Court at the outset dwelt upon the
efficacy of the principle of comity of courts as applicable to India in
respect of child custody matters and for that purpose, exhaustively
traversed the relevant decisions on the issue. It referred to the verdict
in Dhanwanti Joshi2
, which recorded the enunciation of the Privy
Council in Mark T. Mckee vs. Evelyn Mckee7
, which in essence
underlined the paramountcy of the consideration of welfare and
happiness of the infant to be of decisive bearing in the matter of
deciding its custody with the observation that comity of courts
demanded not its enforcement but its grave consideration. In that
case, a decree of divorce was passed in USA and custody of the child
was given to the father and later varied in favour of the mother. At
that stage, the father took away the child to Canada, whereafter in the
habeas corpus proceedings by the mother, though initially the
7 (1951) AC 352 (PC)
26
decisions of the lower courts went against her, the Supreme Court of
Canada gave her custody and the said Court held that the father could
not have the question of custody retried in Canada once the question
was adjudicated in favour of the mother in the U.S.A. earlier. The
above observation was made by the Privy Council on appeal to it which
held that in the proceedings relating to the custody before the
Canadian Court, the welfare and happiness of the infant was of
paramount consideration and the order of a foreign court in USA as to
the custody can be given due weight in the circumstances of the case
but such an order of a foreign court was only one of the factors which
must be taken into consideration. The duty of the Canadian Court to
form any independent judgment on the merits of the matter with
regard to the welfare of the child was emphasized. It recorded as well
that this view was sustained in L (minors) (Wardship: Jurisdiction),
In. re8
, which reiterated that the limited question which arose in the
latter decisions was whether the court in the country in which the
child was removed could conduct (a) summary enquiry or (b) an
elaborate enquiry in the question of custody. It was explicated that in
case of (a) a summary enquiry, the court would return custody to the
country from which the child was removed unless such return could
be shown to be harmful to the child and in case of (b) an elaborate
8 (1974) 1 WLR 250 (CA)
27
enquiry, the court could go into the merits to determine as to where
the permanent welfare lay and ignore the order of the Foreign Court or
treat the fact of removal of the child from another country as only one
of the circumstances and the crucial question as to whether the court
(in the country to which the child is removed) would exercise the
summary or elaborate procedure is to be determined according to the
child’s welfare. It was indicated that the summary jurisdiction to
return the child is invoked, for example, if the child had been removed
from its native land to another country where, may be, his native
language is not spoken, or the child gets divorced from the social
customs and contacts to which he has been accustomed, or its
education in his native land is interrupted and the child is being
subjected to a foreign system of education, for these are all acts which
could psychologically disturb the child. It was mentioned as well that
the summary jurisdiction is exercised only if the court to which the
child has been removed is moved promptly and quickly, for in that
event, the Judge may be well persuaded that it will be better for the
child that those facets be investigated in the court in his native
country on the expectation that an early decision in the native country
could be in the interest of the child before it would develop roots in the
country to which he had been removed. It was expounded in the
alternative, that the Court might as well think of conducting an
28
elaborate enquiry on merits and have regard to the other facts of the
case and the time that has elapsed after the removal of the child and
consider, if it would be in the interest of the child not to have it
returned from the country to which it had been removed, so much so
that in such an eventuality, the unauthorized removal of the child
from the native country would not come in the way of the court in the
country to which the child has been removed, to ignore the removal
and independently consider whether the sending back of the child to
its native country would be in the paramount interest of the child.
This Court recalled its mandate in Elizabeth Dinshaw vs.
Arvand M. Dinshaw & Anr.9
, directing the father of the child
therein, who had removed it from USA contrary to the custody orders
of U.S. Court, to repatriate it to USA to the mother not only because of
the principle of comity but also because on facts, which on
independent consideration merited such restoration of the child to its
native State, in its interest. The following observations in Dhanwanti
Joshi2 qua the state of law vis-a-vis the countries who are not the
signatories of the Hague Convention are of formidable significance and
as noticed in Nithya Anand Raghavan4 , are extracted hereinbelow:
“33. So far as non-Convention countries are
concerned, or where the removal related to a period
before adopting the Convention, the law is that the
court in the country to which the child is removed
9 (1987) 1 SCC 42
29
will consider the question on merits bearing the
welfare of the child as of paramount importance and
consider the order of the foreign court as only a factor
to be taken into consideration as stated in McKee v.
McKee unless the Court thinks it fit to exercise
summary jurisdiction in the interests of the child and
its prompt return is for its welfare, as explained in
Re [L. (Minors) (Wardship : Jurisdiction). As recently
as 1996-1997, it has been held in P. (A minor) (Child
Abduction: Non-Convention Country), Re: by Ward ,
L.J. [1996 Current Law Year Book, pp. 165-166] that
in deciding whether to order the return of a child who
has been abducted from his or her country of
habitual residence—which was not a party to the
Hague Convention, 1980—the courts’ overriding
consideration must be the child’s welfare. There is no
need for the Judge to attempt to apply the provisions
of Article 13 of the Convention by ordering the child’s
return unless a grave risk of harm was established.
See also A. (A Minor) (Abduction: Non-Convention
Country) [Re, The Times, 3-7-1997 by Ward, L.J.
(CA) (quoted in Current Law, August 1997, p. 13].
This answers the contention relating to removal of
the child from USA.”
Here again the court in the country to which the child is removed
was required to consider the question on merits bearing on its welfare
as of paramount significance and take note of the order of the foreign
court as only a factor to be taken into consideration as propounded in
Mckee7
, unless the court thought it fit to exercise the summary
jurisdiction of the child and its prompt return to its native country for
its welfare. In elaboration of the above exposition, this Court in
Nithya Anand Raghavan4
propounded thus:
“40. The Court has noted that India is not yet a
signatory to the Hague Convention of 1980 on “Civil
Aspects of International Child Abduction”. As regards
30
the non-Convention countries, the law is that the court
in the country to which the child has been removed
must consider the question on merits bearing the
welfare of the child as of paramount importance and
reckon the order of the foreign court as only a factor to
be taken into consideration, unless the court thinks it
fit to exercise summary jurisdiction in the interests of
the child and its prompt return is for its welfare. In
exercise of summary jurisdiction, the court must be
satisfied and of the opinion that the proceeding
instituted before it was in close proximity and filed
promptly after the child was removed from his/her
native state and brought within its territorial
jurisdiction, the child has not gained roots here and
further that it will be in the child’s welfare to return to
his native state because of the difference in language
spoken or social customs and contacts to which
he/she has been accustomed or such other tangible
reasons. In such a case the court need not resort to an
elaborate inquiry into the merits of the paramount
welfare of the child but leave that inquiry to the foreign
court by directing return of the child. Be it noted that
in exceptional cases the court can still refuse to issue
direction to return the child to the native state and
more particularly in spite of a pre-existing order of the
foreign court in that behalf, if it is satisfied that the
child’s return may expose him to a grave risk of harm.
This means that the courts in India, within whose
jurisdiction the minor has been brought must
“ordinarily” consider the question on merits, bearing in
mind the welfare of the child as of paramount
importance whilst reckoning the pre-existing order of
the foreign court if any as only one of the factors and
not get fixated therewith. In either situation—be it a
summary inquiry or an elaborate inquiry—the welfare
of the child is of paramount consideration. Thus, while
examining the issue the courts in India are free to
decline the relief of return of the child brought within
its jurisdiction, if it is satisfied that the child is now
settled in its new environment or if it would expose the
child to physical or psychological harm or otherwise
place the child in an intolerable position or if the child
is quite mature and objects to its return. We are in
31
respectful agreement with the aforementioned
exposition.”
The above excerpt would in no uncertain terms underscore the
predication that the courts in India, within whose jurisdiction the
minor has been brought “ordinarily” while examining the question on
merits, would bear in mind the welfare of the child as of paramount
and predominant importance while noting the preexisting order of the
foreign court, if any, as only one of the factors and not get fixated
therewith and that in either situation, be it a summary enquiry or
elaborate enquiry, the welfare of the child is of preeminent and
preponderant consideration, so much so that in undertaking this
exercise, the courts in India are free to decline the relief of repatriation
of the child brought within its jurisdiction, if it is satisfied that it had
settled in its new environment or that it would be exposed thereby to
physical harm or otherwise, if it is placed in an intolerable or
unbearable situation or environment or if the child in a given case, if
matured, objects to its return.
Sustenance of this view was sought to be drawn from the verdict
of another three-Judge Bench of this Court in V. Ravichandran6
, as
expressed in paragraphs 27 to 30 in the following terms:
“27. … However, in view of the fact that the child had lived
with his mother in India for nearly twelve years, this Court
held that it would not exercise a summary jurisdiction to
return the child to the United States of America on the
32
ground that its removal from USA in 1984 was contrary to
the orders of US courts. It was also held that whenever a
question arises before a court pertaining to the custody of a
minor child, the matter is to be decided not on
considerations of the legal rights of the parties but on the
sole and predominant criterion of what would best serve the
interest of the minor.”
(emphasis supplied)
Again in paras 29 and 30, the three-Judge Bench observed
thus: (SCC pp. 195-96)
“29. While dealing with a case of custody of a child removed
by a parent from one country to another in contravention of
the orders of the court where the parties had set up their
matrimonial home, the court in the country to which the
child has been removed must first consider the question
whether the court could conduct an elaborate enquiry on
the question of custody or by dealing with the matter
summarily order a parent to return custody of the child to
the country from which the child was removed and all
aspects relating to the child’s welfare be investigated in a
court in his own country. Should the court take a view that
an elaborate enquiry is necessary, obviously the court is
bound to consider the welfare and happiness of the child as
the paramount consideration and go into all relevant
aspects of welfare of the child including stability and
security, loving and understanding care and guidance and
full development of the child’s character, personality and
talents. While doing so, the order of a foreign court as to his
custody may be given due weight; the weight and persuasive
effect of a foreign judgment must depend on the
circumstances of each case.
30. However, in a case where the court decides to exercise
its jurisdiction summarily to return the child to his own
country, keeping in view the jurisdiction of the court in the
native country which has the closest concern and the most
intimate contact with the issues arising in the case, the
court may leave the aspects relating to the welfare of the
child to be investigated by the court in his own native
country as that could be in the best interests of the child.
The indication given in McKee v. McKee that there may be
cases in which it is proper for a court in one jurisdiction to
33
make an order directing that a child be returned to a
foreign jurisdiction without investigating the merits of the
dispute relating to the care of the child on the ground that
such an order is in the best interests of the child has been
explained in L. (Minors), In re [L. (Minors) (Wardship :
Jurisdiction), (1974) 1 WLR 250 (CA)] and the said view has
been approved by this Court in Dhanwanti Joshi [Dhanwanti
Joshi. Similar view taken by the Court of Appeal in H.
(Infants) (1966) 1 WLR 381 has been approved by this Court
in Elizabeth Dinshaw.”
(emphasis supplied)
The quintessence of the legal exposition on the issue was
succinctly synopsised in the following terms:
“42. The consistent view of this Court is that if the child
has been brought within India, the courts in India may
conduct: (a) summary inquiry; or (b) an elaborate inquiry
on the question of custody. In the case of a summary
inquiry, the court may deem it fit to order return of the
child to the country from where he/she was removed
unless such return is shown to be harmful to the child.
In other words, even in the matter of a summary inquiry,
it is open to the court to decline the relief of return of the
child to the country from where he/she was removed
irrespective of a pre-existing order of return of the child
by a foreign court. In an elaborate inquiry, the court is
obliged to examine the merits as to where the paramount
interests and welfare of the child lay and reckon the fact
of a pre-existing order of the foreign court for return of
the child as only one of the circumstances. In either
case, the crucial question to be considered by the court
(in the country to which the child is removed) is to
answer the issue according to the child’s welfare. That
has to be done bearing in mind the totality of facts and
circumstances of each case independently. Even on close
scrutiny of the several decisions pressed before us, we do
not find any contra view in this behalf. To put it
differently, the principle of comity of courts cannot be
given primacy or more weightage for deciding the matter
of custody or for return of the child to the native State.”
21. Thus the state of law as approved in Nithya Anand Raghavan4
34
is that if a child is brought from a foreign country, being its native
country to India, the court in India may conduct (a) summary enquiry,
or (b) an elaborate enquiry on the question of custody, if called for. In
the case of a summary enquiry, the court may deem it fit to order the
return of the child to the country from where he/she has been
removed unless such return is shown to be harmful to the child.
Axiomatically thus, even in case of a summary enquiry, it is open to
the court to decline the relief of return of the child to the country from
where he/she has been removed irrespective of a pre-existing order of
return of a child by a foreign court, in case it transpires that its
repatriation would be harmful to it. On the other hand, in an
elaborate enquiry, the court is obligated to examine the merits as to
where the paramount interest and welfare of the child lay and take
note of the pre-existing order of the foreign court for the return of the
child as only one of the circumstances. As a corollary, in both the
eventualities whether the enquiry is summary or elaborate, the court
would be guided by the pre-dominant consideration of welfare of the
child assuredly on an overall consideration on all attendant facts and
circumstances. In other words, the principle of comity of courts is not
to be accorded a yielding primacy or dominance over the welfare and
well-being of the child which unmistakeably is of paramount and
decisive bearing.
35
22. This Court in Nithya Anand Raghavan4 also had to examine as
to whether a writ of habeas corpus was available to the father qua the
child which was in the custody of the mother, more particularly in the
face of ex-parte order of the court in U.K. against her and directing her
for its return to its native country by declaring it to remain as a ward
of that court during its minority or until further orders. This Court
noted that this order had remained not only unchallenged by the
appellant mother but also no application had been made by her before
the foreign court for its modification. This Court however was firstly of
the view that this order per se did not declare the custody of the minor
with the appellant mother to be unlawful or that till it returned to
England, its custody with the mother had become or would be treated
as unlawful inter alia for the purposes of considering a petition for
issuance of writ of Hebeas Corpus. In this regard, the decision of this
Court, amongst others in Syed Saleemuddin vs. Dr. Rukhsana &
Ors.10, was adverted to, wherein it had been proclaimed that the
principal duty of the court moved for the issuance of writ of habeas
corpus in relation to the custody of a minor child is to ascertain
whether such custody is unlawful or illegal and whether the welfare of
the child requires, that his present custody should be changed and
the child ought to be handed over to the care and custody of any
10 (2001) 5 SCC 247
36
person. It was once again emphasized that while doing so, the
paramount consideration must be, the welfare of the child.
The observation in Elizabeth Dinshaw9
that in such matters,
the custody must be decided not by reference to the legal rights of the
parties but on the sole and predominant criterion as to what would
best serve the interest and welfare of the minor and that to that
extent, the High Court would exercise its parens patriae jurisdiction,
as the minor is within its jurisdiction was reminisced. In the facts of
the case also, noting the supervening fact that the appellant was the
biological mother and natural guardian of the minor child, the remedy
of writ of habeas corpus invoked for enforcement of the directions of
the foreign court was declined, however leaving the respondent/father
to take recourse to such other remedy as would be available in law for
the enforcement of the order passed by the foreign court for securing
the custody of the child. It was held that the appellant being the
biological mother and natural guardian of the child, it could be
presumed that its custody with her was lawful.
23. This Court in Nithya Anand Raghavan4 next turned to the
contextual facts to record that the parents of the child were of Indian
origin and that the minor was an Indian citizen by birth as she was
born in Delhi and that she had not given up her Indian citizenship
though she was granted UK citizenship subsequent thereto. That the
37
child was admitted to a primary school in UK in September 2013 and
that she had studied there in July 2015 was noted. It was mentioned
as well that till she accompanied her mother on 02.07.2015 to India,
no proceeding of any kind had been filed in the UK Court, either in
relation to any matrimonial dispute between the parents or for her
custody. In India, the child had been living with her grand-parents
and other family members and relations unlike in U.K., where she
lived in a nuclear family of three with no other relatives. That she had
been studying in India for last over one year and had spent equal time
in both the countries up to the first six years of her life was taken note
of as well. This Court also expressed that the child would be more
comfortable and secured to live with her mother here in India, who
can provide her with motherly love, care, guidance and the required
upbringing for her desired grooming of personality, character and
faculties. That being a girl child, the custody, company and
guardianship of the mother was of utmost significance was felt. It was
also recorded that being a girl child of the age of about seven years,
she ought to be ideally in the company of her mother in absence of
circumstances that such association would be harmful to her. That
there was no restraint order passed by any court or authority in U.K.
before the child had travelled with her mother to India was accounted
for as well. This Court noticed most importantly, that the child was
38
suffering from cardiac disorder, which warranted periodical medical
reviews and appropriate care and attention, which it felt could be
provided only by the mother as the respondent/father being employed
would not be in a position to extend complete and full attention to his
daughter. That the appellant/mother had neither any intention to
return to UK nor according to her if the child returns to UK, she would
be able to secure the desired access to her to the child to provide care
and attention was noted in express terms. On an evaluation of the
overall facts and circumstances, this Court thus was of the unhesitant
opinion that it would be in the interest of the child to remain in the
custody of her mother and that her return to UK would prove harmful
to her. While concluding thus, it was stated that this arrangement
notwithstanding the appellant/mother ought to participate in the
proceedings before the UK Court so long as it had the jurisdiction to
adjudicate the matter before it. It was observed as well that, as the
scrutiny involved with regard to the custody had arisen from a writ
petition filed by the respondent/father for issuance of writ of a habeas
corpus and not to decide the issue of grant or otherwise of the custody
of the minor, all relevant aspects would have to be considered on their
own merit in case a substantive proceeding for custody is made before
any court of competent jurisdiction, including in India, independent of
any observation made in the judgment.
39
To complete the narrative, the analysis of the other relevant
pronouncements rendered on the issue would be adverted to in
seriatim. In V. Ravi Chandran6
, a writ of habeas corpus for
production of minor son from the custody of his mother was sought
for by his father. The child was born in US and was an American
citizen and was about eight years of age when he was removed by the
mother from U.S., in spite of her consent order on the issue of custody
and guardianship of the minor passed by the competent U.S. Court.
The minor was given in the joint custody to the parents and a restraint
order was operating against the mother when it was removed from
USA to India. Prior to his removal, the minor had spent few years in
U.S.. All these factors weighed against the mother as is discernible
from the decision, whereupon this Court elected to exercise the
summary jurisdiction in the interest of the child, whereupon the
mother was directed to return the child to USA within a stipulated
time.
24. In Shilpa Aggarwal5
, the minor girl child involved was born in
England having British citizenship and was only 3½ years of age at
the relevant time. The parents had also acquired the status of
permanent residents of U.K. In the facts and circumstances of the
case, this Court expressed its satisfaction that in the interest of the
minor child, it would be proper to return her to U.K. by applying the
40
principle of comity of courts. The Court was also of the opinion that
the issue regarding custody of the child should be decided by the
foreign court from whose jurisdiction the child was removed and
brought to India. A summary enquiry was resorted to in the facts of
the case.
25. In Arathi Bandi vs. Bandi Jagadrakshaka Rao and others11
the minor involved was a male child who was born in USA and had
acquired the citizenship of that country by birth. The child was
removed from USA by the mother in spite of a restraint order and a
red corner notice operating against her had been issued by a court of
competent jurisdiction in USA. This Court therefore held that the facts
involved were identical to those in V. Ravi Chandran6 and further
noticed that the mother of the child also had expressed her intention
to return to USA and live with her husband though the latter was not
prepared to cohabit with her.
26. In Surya Vadanan1
, the two minor girls aged 10 years 6 years
respectively were British citizens by birth. Following intense
matrimonial discords, the mother had left UK and had come to India
with her two daughters. She also instituted a proceeding in the Family
Court at Coimbatore seeking dissolution of marriage. The husband,
finding the wife to be unrelenting and disinclined to return to U.K.
11 (2013) 15 SCC 790
41
with her daughters, petitioned the High Court of Justice in U.K. for
making the children as the wards of the Court, which passed an order
granting the prayer and required the mother to return the children to
its jurisdiction. This order was passed even before any formal order
could be passed on the petition filed by the wife seeking divorce. This
order was followed by another order of the U.K. Court giving
peremptory direction to the wife to produce the two daughters before
the U.K. Court and was supplemented by a penal notice to her. It was
thereafter that the husband moved the Madras High Court for a writ of
habeas corpus on the ground that the wife had illegal custody of the
two daughters. On the following considerations as extracted
hereinbelow, relief as prayed for by the husband was granted:
“56. However, if there is a pre-existing order of a
foreign court of competent jurisdiction and the
domestic court decides to conduct an elaborate
inquiry (as against a summary inquiry), it must have
special reasons to do so. An elaborate inquiry should
not be ordered as a matter of course. While deciding
whether a summary or an elaborate inquiry should be
conducted, the domestic court must take into
consideration:
(a) The nature and effect of the interim or
interlocutory order passed by the foreign court.
(b) The existence of special reasons for
repatriating or not repatriating the child to the
jurisdiction of the foreign court.
(c) The repatriation of the child does not cause
any moral or physical or social or cultural or
psychological harm to the child, nor should it
cause any legal harm to the parent with whom
the child is in India. There are instances where
42
the order of the foreign court may result in the
arrest of the parent on his or her return to the
foreign country. In such cases, the domestic
court is also obliged to ensure the physical
safety of the parent.
(d) The alacrity with which the parent moves
the foreign court concerned or the domestic
court concerned, is also relevant. If the time
gap is unusually large and is not reasonably
explainable and the child has developed firm
roots in India, the domestic court may be well
advised to conduct an elaborate inquiry.”
27. Vis-à-vis the renditions in V. Ravi Chandran6
, Shilpa
Aggarwal5
and Arathi Bandi11, this Court in Nithya Anand
Raghavan4
distinguished the facts involved therein from the one
under its scrutiny. While underlining that the considerations which
impelled the court to adopt its summary approach/jurisdiction in
directing the return of the child to its native country, did not in any
way discount or undermine the predominant criterion of welfare and
interest of the child even to outweigh neuter or offset the principle of
comity of courts, it disapproved the primacy sought to be accorded to
the order of the foreign court on the issue of custody of minor in
Surya Vadanan1 though negated earlier in Dhanwanti Joshi2
and
reiterated that whether it was a case of summary enquiry or an
elaborate enquiry, the paramount consideration was the interest and
welfare of the child so much so that the preexisting order of a foreign
court could be taken note of only as one of the factors. The alacrity or
43
the expedition with which the applicant/parent moves the foreign
court or the domestic court concerned, for custody as a relevant factor
was also not accepted to be of any definitive bearing. This notion of
“first strike principle” was not subscribed to and further the
extrapolation of that principle to the courts in India as predicated in
Surya Vadanan1
was also held to be in-apposite by adverting inter
alia to Section 14 of the Guardians and Wards Act, 1890 and Section
10 of the Civil Procedure Code.
28. The following passage from Nithya Anand Raghavan4
discarding the invocation of “first strike” principle as a definitive factor
in furtherance of the applicability of the principle of comity of courts is
quoted as hereunder:
“66. The invocation of first strike principle as a decisive
factor, in our opinion, would undermine and whittle down
the wholesome principle of the duty of the court having
jurisdiction to consider the best interests and welfare of the
child, which is of paramount importance. If the Court is
convinced in that regard, the fact that there is already an
order passed by a foreign court in existence may not be so
significant as it must yield to the welfare of the child. That
is only one of the factors to be taken into consideration.
The interests and welfare of the child are of paramount
consideration. The principle of comity of courts as observed
in Dhanwanti Joshi case in relation to non-Convention
countries is that the court in the country to which the
child is removed will consider the question on merits
bearing the welfare of the child as of paramount
importance and consider the order of the foreign court as
only a factor to be taken into consideration. While
considering that aspect, the court may reckon the fact that
the child was abducted from his or her country of habitual
residence but the court’s overriding consideration must be
the child’s welfare.”
44
In conclusion, qua the decisions relied upon by the
respondent-father, the facts contained therein were held to be
distinguishable and it was observed that though the factual backdrop
as obtained therein necessitated the court to issue direction to return
the child to the native State, it did not follow that in deserving cases,
the Courts in India were denuded of their powers to decline the relief
to relocate the child to the native State merely because of a
pre-existing order of foreign court of competent jurisdiction. The law
laid down in Dhanwanti Joshi2
and approved by a three Judge
Bench of this Court in V. Ravi Chandran6
was enounced to be the
good law, thus reiterating that so far as non-convention countries are
concerned, the court in the country in which the child is removed
while examining the issue of its repatriation to its native country,
would essentially bear in mind that the welfare of the child was of
paramount importance and that the existing order of foreign court was
only a factor to be taken note of. It was reiterated that the summary
jurisdiction to return the child could be exercised in cases where the
child had been removed from his native land to another country where
his native language is not spoken or the child gets divorced from social
customs and contacts to which he is accustomed or if his education in
his native land is interrupted and the child is subjected to foreign
45
system of education, thus adversely impacting upon his psychological
state and overall process of growth. Though a prompt and expeditious
move on the part of the applicant parent for the repatriation of the
child in a court in the country to which it had been removed may be a
relevant factor, the overwhelming and determinative consideration
unfailingly has to be in the interest and welfare of the child. It was
observed that in the facts of the case, the minor child after attaining
majority would be free to exercise her choice to go to U.K and stay
with her father but till that eventuality, she should stay in the custody
of mother unless the court of competent jurisdiction trying the issue of
custody of the child did order to the contrary. Visitation right to the
respondent-father however was granted and directions were issued so
as to facilitate the participation of the appellant- mother in the
pending proceedings before the U.K. Court, inter alia by requiring the
respondent-husband to bear the necessary costs to meet the
expenditure towards all relevant aspects related thereto. The
impugned judgment of the High Court issuing the writ of habeas
corpus in favour of the respondent-husband was thus set aside.
29. The dialectics and determinations in Nithya Anand Raghavan4
have been alluded to in pervasive details as the adjudication therein
by a Bench of larger coram has forensically analyzed all the
comprehensible facets of the issue, to which we deferentially
46
subscribe.
30. The decisions cited at the Bar and heretofore, traversed present
fact situations with fringe variations, the common and core issue
being the justifiability or otherwise factually and/or legally, of the
relocation of a child removed from its native country to India on the
basis of the principle of comity of courts and doctrines of “intimate
contact” and “closest concern”.
31. The following observations in Ruchi Majoo vs. Sanjeev Majoo12
bearing on the parens patriae jurisdiction of Indian courts in cases
involving custody of minor children are apt as well:
“Recognition of decrees and orders passed by foreign
courts remains an eternal dilemma inasmuch as
whenever called upon to do so, courts in this country
are bound to determine the validity of such decrees
and orders keeping in view the provisions of Section 13
of the Code of Civil Procedure, 1908, as amended by
the Amendment Acts of 1999 and 2002. The duty of a
court exercising its parens patriae jurisdiction as in
cases involving custody of minor children is all the
more onerous. Welfare of the minor in such cases
being the paramount consideration; the court has to
approach the issue regarding the validity and
enforcement of a foreign decree or order carefully.
Simply because a foreign court has taken a particular
view on any aspect concerning the welfare of the
minor is not enough for the courts in this country to
shut out an independent consideration of the matter.
Objectivity and not abject surrender is the mantra in
such cases. That does not, however, mean that the
order passed by a foreign court is not even a factory to
be kept in view. But it is one thing to consider the
foreign judgment to be conclusive and another to
12
(2011) 6 SCC 479
47
treat it as a factor or consideration that would go into
the making of a final decision.”
32. The gravamen of the judicial enunciation on the issue of
repatriation of a child removed from its native country is clearly
founded on the predominant imperative of its overall well-being, the
principle of comity of courts, and the doctrines of “intimate contact
and closest concern” notwithstanding. Though the principle of comity
of courts and the aforementioned doctrines qua a foreign court from
the territory of which a child is removed are factors which deserve
notice in deciding the issue of custody and repatriation of the child, it
is no longer res integra that the ever overriding determinant would be
the welfare and interest of the child. In other words, the invocation of
these principles/doctrines has to be judged on the touchstone of
myriad attendant facts and circumstances of each case, the ultimate
live concern being the welfare of the child, other factors being
acknowledgeably subservient thereto. Though in the process of
adjudication of the issue of repatriation, a court can elect to adopt a
summary enquiry and order immediate restoration of the child to its
native country, if the applicant/parent is prompt and alert in his/her
initiative and the existing circumstances ex facie justify such course
again in the overwhelming exigency of the welfare of the child, such a
course could be approvable in law, if an effortless discernment of the
relevant factors testify irreversible, adverse and prejudicial impact on
48
its physical, mental, psychological, social, cultural existence, thus
exposing it to visible, continuing and irreparable detrimental and
nihilistic attentuations. On the other hand, if the applicant/parent is
slack and there is a considerable time lag between the removal of the
child from the native country and the steps taken for its repatriation
thereto, the court would prefer an elaborate enquiry into all relevant
aspects bearing on the child, as meanwhile with the passage of time, it
expectedly had grown roots in the country and its characteristic
milieu, thus casting its influence on the process of its grooming in its
fold.
33. The doctrines of “intimate contact” and “closest concern” are of
persuasive relevance, only when the child is uprooted from its native
country and taken to a place to encounter alien environment,
language, custom etc., with the portent of mutilative bearing on the
process of its overall growth and grooming.
34. It has been consistently held that there is no forum convenience
in wardship jurisdiction and the peremptory mandate that underlines
the adjudicative mission is the obligation to secure the unreserved
welfare of the child as the paramount consideration.
35. Reverting to the present facts, the materials as available, do
substantiate lingering dissensions between the parties. They are living
separately since 2014 with one child each in their company and
49
charge. The children are US citizens by birth. Noticeably, the child
Aadvik, who is the subject matter of the lis and custody was barely 2½
years old when he came over to India and had stayed here since then.
Today, he is a little over 5 years old. In other words, he has spent half
of his life at this age, in India. Considering his infant years of stay in
US, we construe it to be too little for the required integration of his
with the social, physical, psychological, cultural and academic
environment of US to get totally upturned by his transition to this
country, so much so that unless he is immediately repatriated, his
inherent potentials and faculties would suffer an immeasurable set
back. The respondent-mother also is not favourably disposed to return
to India, she being a working lady in US and is also disinclined to
restore her matrimonial home. The younger son is with her. There is
no convincing material on record that the continuation of the child in
the company and custody of the appellant in India would be
irreparably prejudicial to him. The e-mails exchanged by the parties as
have been placed on records do suggest that they had been in touch
since the child was brought to India and even after the first order
dated 28.05.2015 was passed by the court in US. In the said e-mails,
they have fondly and keenly referred to both the sons staying in each
other’s company, expressing concern about their illness and general
well-being as well. As has been claimed by the appellant, the child is
50
growing in a congenial environment in the loving company of his
grand-parents and other relatives. He has been admitted to a reputed
school and contrary to the nuclear family environment in US, he is
exposed to a natural process of grooming in the association of his
elders, friends, peers and playmates, which is irrefutably
indispensable for comprehensive and conducive development of his
mental and physical faculties. The issue with regard to the
repatriation of a child, as the precedential explications would
authenticate has to be addressed not on a consideration of legal
rights of the parties but on the sole and preponderant criterion of
the welfare of the minor. As aforementioned, immediate restoration of
the child is called for only on an unmistakable discernment of the
possibility of immediate and irremediable harm to it and not
otherwise. As it is, a child of tender years, with malleable and
impressionable mind and delicate and vulnerable physique would
suffer serious set-back if subjected to frequent and unnecessary
translocation in its formative years. It is thus imperative that unless,
the continuance of the child in the country to which it has been
removed, is unquestionably harmful, when judged on the touchstone
of overall perspectives, perceptions and practicabilities, it ought not to
be dislodged and extricated from the environment and setting to
which it had got adjusted for its well-being.
51
36. Noticeably, a proceeding by the appellant seeking custody of the
child under the Guardian and Wards Act, 1890 has been instituted,
which is pending in the court of the Principal Judge, Family Court,
Rohini, Delhi. This we mention, as the present adjudication pertains
to a challenge to the determination made in a writ petition for habeas
corpus and not one to decide on the entitlement in law for the custody
of the child.
37. In Nithya Anand Raghavan4
as well, this Court while
maintaining the custody of the child in favour of the mother in
preference to the applicant-father had required the mother to
participate in the proceeding before the foreign court initiated by the
respondent-father therein. It was observed that the custody of the
child would remain with the respondent-mother till it attained
majority, leaving it at liberty then to choose its parent to reside with.
The arrangement approved by this Court was also made subject to the
decision with regard to its custody, if made by a competent Court.
38. In the overwhelming facts and circumstances, we see no reason
to take a different view or course. In view of order dated 03.05.2016 of
this Court, the child has remained in the custody of the
appellant-father. To reiterate, no material has been brought on record,
persuasive and convincing enough, to take a view that immediate
restoration of the custody of the child to the respondent-mother in the
52
native country is obligatorily called for in its interest and welfare. The
High Court, as the impugned judgment and order would demonstrate,
did not at all apply itself to examine the facts and circumstances and
the other materials on record bearing on the issue of welfare of the
child which are unmistakably of paramount significance and instead
seems to have been impelled by the principle of comity of courts and
the doctrines of “intimate contact” and “closest concern” de hors
thereto. The appellant being the biological father of Aadvik, his
custody of the child can by no means in law be construed as illegal or
unlawful drawing the invocation of a superior Court’s jurisdiction to
issue a writ in the nature of habeas corpus. We are, in the textual
facts and on an in-depth analysis of the attendant circumstances,
thus of the view that the dislodgment of the child as directed by the
impugned decision would be harmful to it. Having regard to the nature
of the proceedings before the US Court, the intervening developments
thereafter and most importantly the prevailing state of affairs, we are
of the opinion that the child, till he attains majority, ought to continue
in the custody, charge and care of the appellant, subject to any order
to the contrary, if passed by a court of competent jurisdiction in an
appropriate proceeding deciding the issue of its custody in accordance
with law. The High Court thus, in our estimate, erred in law and on
facts in passing the impugned verdict.
53
39. The impugned judgment and order is thus set aside. We however
direct that the parties would participate in the pending proceedings
relating to the custody of the child, if the same is pursued and the
court below, before which the same is pending, would decide the same
in accordance with law expeditiously without being influenced in any
way, by the observations and findings recorded in this determination.
40. The appeal is thus allowed.
………………………………..CJI.
[DIPAK MISRA ]
………………………………….J
[AMITAVA ROY ]
NEW DELHI;
DECEMBER 6, 2017.
54
ITEM NO.1501 COURT NO.5 SECTION II-C
S U P R E M E C O U R T O F I N D I A
RECORD OF PROCEEDINGS
Criminal Appeal No(s). 968/2017
PRATEEK GUPTA Appellant(s)
VERSUS
SHILPI GUPTA & ORS. Respondent(s)
Date : 06-12-2017 This appeal was called on for Judgment today.
For Appellant(s) Mr. Braj Nath Patel, Adv.
Ms. Sweta, Adv.
Ms. Romila, Adv.
Ms. Binu Tamta, AOR

For Respondent(s) Mr. N. S. Dalal, Adv.
Mr. D. P. Singh, Adv.
Mr. R. C. Kaushik, AOR

Hon’ble Mr. Justice Amitava Roy pronounced the reportable
Judgment of the Bench comprising Hon’ble The Chief Justice of India
and His Lordship.
The appeal is allowed.
Pending Interlocutory Applications, if any, stand disposed of.
(JAYANT KUMAR ARORA) (RENU DIWAN)
COURT MASTER ASSISTANT REGISTRAR
(Signed reportable Judgment is placed on the file)

Posted in Uncategorized

whether in the facts of this case, the Micro, Small and Medium Enterprises Development Act, 2006 would apply. As discussed earlier, the proceedings were conducted before DRT under RDDBFI Act, 1993 which finally culminated in DRT’s order dated 24.07.2008 and had become final and binding and was also accepted and acted upon by respondent No.1.

 

REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 5150 OF 2017
BANK OF INDIA …Appellant
Versus
YADAV CONSULTANCY SERVICES (P) LTD.
AND ORS. ….Respondents
J U D G M E N T
R. BANUMATHI, J.
This appeal is preferred against the judgment dated 19.11.2015
passed by the High Court of Judicature at Bombay in ARA No. 15 of
2014 dismissing the appeal of the appellant Bank thereby affirming
the judgment of the District Judge, Pune and the award passed by
the MSMEDF Council directing the appellant Bank to pay
Rs.1,62,82,079/- with interest at the rate of 24% to respondent No. 1
and also pay cost of Rs. 5,00,000/- to respondent No. 1.
2. The matter has a chequered history of two decades. Brief facts
which led to filing of this appeal are as follows:- The appellant Bank
filed suit in Special Suit No. 628 of 1998 for recovery of Rs.9.55 lakhs
along with interest against one M/s Sona Aluminium Finishers (P) Ltd.
The said suit was decreed on 30.01.1999. Since the decreed amount
Page No. 1 of 15
exceeded rupees ten lakhs, in view of Section 31-A of Recovery of
Debts due to Banks and Financial Institutions (RDDBFI) Act, 1993,
the recovery proceedings were transferred to the Recovery Officer,
Debt Recovery Tribunal (DRT), Pune and registered as R.P. No.
06/2002. After attachment of the property, the property was
auctioned on 08.03.2006. By order of DRT dated 14.07.2006,
certificate of sale was issued in favour of auction
purchasers-respondents No. 3 to 5. Since the Certificate Debtors
(Mortgagor/Guarantor) were said to be creating obstruction in delivery
of possession of the property to the auction purchasers, by order
dated 26.07.2006, the Recovery Officer, DRT, Pune appointed
respondent No.1 as “Court Commissioner”. The appellant Bank was
directed to pay service charges to the first respondent. Respondent
No. 1 took possession of the property on 09.11.2006. Auction
purchasers filed an application in R.P. No. 06 of 2002 on 13.11.2006
and DRT, Pune on the same date i.e. 13.11.2006 directed respondent
No. 1 to hand over the possession of the subject property to the
auction purchasers.
3. There was then a dispute between the appellant Bank and M/s
Sona Aluminium Finishers (P) Ltd. – Certificate Debtor and the same
came to be compromised; however the same failed due to
Page No. 2 of 15
non-compliance of the terms and conditions of the compromise.
Appellant Bank sent letter dated 04.05.2007 informing the first
respondent that they had decided to discharge the Court
Commissioner with effect from 08.05.2007 and the Bank also paid the
charges of respondent No. 1 up to 08.05.2007. However, the
Recovery Officer by his order dated 12.06.2007 directed the appellant
Bank to continue to pay the charges to respondent No. 1 which was
challenged by the appellant Bank before the Presiding Officer, DRT,
Pune by preferring Appeal No. 25 of 2007. In Appeal No. 25 of 2007,
vide order dated 24.07.2008, DRT set aside the order of the
Recovery Officer and directed the first respondent to take steps for
recovery of its charges from the auction purchasers from 08.05.2007.
Be it noted, respondent No. 1 had not challenged the order dated
24.07.2008; but filed an application on 07.11.2008 in R.P. No.
06/2002 seeking for direction to the auction purchasers to pay its
charges. Only the auction purchasers challenged the order of DRT
dated 24.07.2008 before Debt Recovery Appellate Tribunal (DRAT),
Mumbai in Appeal No. 589 of 2008 wherein respondent No. 1 was
one of the respondents. When the said appeal filed by the auction
purchasers was pending before DRAT, the first respondent filed Writ
Petition No. 10259 of 2011 seeking direction from the High Court to
Page No. 3 of 15
expedite hearing of the said appeal and dispose the same at an early
date. The said writ petition was disposed of by order dated
16.01.2012 directing DRAT, Mumbai to decide the appeal within a
period of three months and accordingly, the said Appeal No. 589 of
2008 was dismissed for default on 30.05.2012.
4. After so pursuing the matter before DRT, DRAT and the High
Court, the first respondent instead of challenging the order dated
30.05.2012, sought arbitration before Micro, Small and Medium
Enterprises Development Facilitation Council (MSMEDF Council),
Pune under Micro, Small and Medium Enterprises Development
(MSMED) Act, 2006. The MSMEDF Council passed an ex parte
award on 12.09.2012 directing the appellant Bank to pay a sum of
Rs. 1,62,82,079/- to respondent No. 1 within the period of one month
from the date of award i.e. 12.09.2012 with interest at the rate of
24%. In the incidental proceedings arising out of the award passed
by the MSMEDF Council, by order dated 19.03.2013 in Writ Petition
No. 2877 of 2013 filed by the appellant Bank, the High Court stayed
the order of the District Judge, Pune passed in DKT No. 1741 of
2012, subject to deposit the entire decretal amount that is
Rs. 1,93,22,590/- within one week with the Registrar, High Court of
Judicature at Bombay and the appellant Bank had deposited the said
Page No. 4 of 15
amount. Appeal filed by the appellant Bank under Section 34 of the
Arbitration and Conciliation Act, 1996 being Civil Application No. 352
of 2013 was dismissed by the District Judge, Pune vide order dated
16.06.2014. Further appeal filed by the appellant Bank under Section
37 of the Arbitration and Conciliation Act, 1996 in Arbitration Petition
No. 15 of 2014 came to be dismissed by the High Court inter alia on
various grounds:- (i) DRT has no jurisdiction to entertain the appeal
and therefore order dated 24.07.2008 would be non est; (ii) MSMED
Act, 2006 was specially enacted to deal with dispute of delayed
payments to service providers and the MSMEDF Council had
jurisdiction to adjudicate the dispute; and (iii) Bank has not taken any
step to take possession from Court Commissioner after paying the
charges; but it has simply refused to pay the charges and dragged
the litigation. Being aggrieved, the appellant Bank preferred this
appeal.
5. We have heard at length Mr. Dushyant Dave, learned senior
counsel appearing for the appellant Bank and Mr. Prakash
Wamanrao Yadav-the first respondent who appeared in-person. We
have carefully considered the rival contentions and perused the
impugned judgment and the materials on record.
Page No. 5 of 15
6. Upon consideration of the rival contentions, the following points
arise for consideration in this appeal:-
i. When the obligation of the appellant Bank to pay the charges
expired on 30.11.2006, when the physical possession of the subject
property was handed over to the auction purchasers and when the
order dated 24.07.2008 of Debt Recovery Appellate Tribunal, Pune
has attained finality, can the first respondent claim charges for
security services from the appellant Bank?
ii. Whether the High Court was right in saying that DRT had no
jurisdiction to entertain the appeal and that the order dated
24.07.2008 would be non est?
iii. When the first respondent was appointed as Court Commissioner
through the order of the Recovery Officer in the proceedings before
DRT in R.P. No. 06/2002 and when the parties were vigorously
pursuing the matter before DRT, DRAT and also before the High
Court, whether the first respondent was right in approaching the
Micro, Small and Medium Enterprises Development Facilitation
(MSMEDF) Council, Pune;
-andiv.
Whether the award passed by the Micro, Small and Medium
Enterprises Development Facilitation (MSMEDF) Council, Pune
affirmed by the District Court and also by the High Court is
sustainable?
7. The auction of the property was conducted on 08.03.2006 and
the sale of the auctioned property was confirmed on 14.07.2006 and
Page No. 6 of 15
the sale certificate was issued in favour of the auction purchasers on
the same date. The Recovery Officer appointed the first respondent
as Court Commissioner on 26.07.2006 and the fees of the first
respondent to be directly paid by the Certificate Holder Bank. On
13.11.2006, the appellant Bank filed purshis praying to hand over the
possession of subject property (Pavitra Hall) to the auction
purchasers and on the same date i.e. 13.11.2006, on the application
filed by the auction purchasers, possession of the subject property
was handed over to the auction purchasers and they have also
issued acknowledgement of possession. On the same date i.e.
13.11.2006, purshis on behalf of the auction purchasers was also
filed in R.P. No. 06 of 2002 before DRT in and by which the auction
purchasers undertook to pay all expenses as required to protect their
possession. Purshis of expenses filed by the auction purchasers
reads as under:-
“Purshis of expenses
Purshis on behalf of auction purchaser is as under:
a) That from the time of taking possession i.e. 13.11.2006 of auctioned property
as purchased i.e., “Pavitra Hall”, the Auction Purchaser shall bear all the
expenses as may be required to protect their possession, including
payments if required to be made to the security personnel. That the Auction
Purchaser shall be liable accountable & duty bound to safeguard the
possession to the exclusion of all others
b) Hence this purshis.”
Page No. 7 of 15
8. The appellant Bank sent the communication to the first
respondent on 04.05.2007 calling upon him to get his bill cleared for
Rs. 30,866/- being the charges for security services at “Pavitra Hall”
up to 08.05.2007. In the said communication, Bank had made it clear
that “…..no further payment will be made to you (Yadav Consultancy)
by the Bank…..”; however, the Recovery Officer by his letter dated
12.06.2007 directed the appellant Bank to continue to pay the
charges for security services to the first respondent. Appellant Bank
challenged the said order of Recovery Officer dated 12.06.2007
before DRT in Appeal No. 25 of 2007. DRT set aside the said order
of the Recovery Officer and directed the Recovery Officer to recover
Court Commissioner charges from 08.05.2007 from the auction
purchasers. We may usefully refer to the said order of the DRT dated
24.07.2008 which reads as under:-
“…….The Court Commissioner was appointed at the instance of the
Recovery Officer and the Recovery Officer has wrongly saddled the
appellant to pay the charges. The Court Commissioner should not suffer
in the present proceeding and, therefore, Recovery Officer is directed to
recover Court Commissioner charges from 08.05.2007 till his discharge
from the auction purchasers……..”
9. The first respondent has not challenged the order of DRT dated
24.07.2008; but even filed application on 07.11.2008 before DRT,
Pune seeking for direction to the auction purchasers to pay the Court
Page No. 8 of 15
Commissioner charges to the first respondent. The first respondent
had also filed contempt petition against the appellant Bank and the
auction purchasers. The Recovery Officer had heard all the parties
including the Certificate Debtor (CD) who prayed for setting aside the
sale of the auction property “Pavitra Hall”. The Bank inter alia prayed
that the auction purchasers be directed to pay the Court
Commissioner charges only up to 13.11.2006 and discharge the
Court Commissioner from that date. After considering the rival claims
of all the parties, by order dated 25.03.2009 in R.P. No. 06/2002, the
Recovery Officer held that the continuation of respondent No. 1 for
safeguarding the auctioned property was solely on behalf of auction
purchasers and his duty as “Court Commissioner” had ceased to
exist on 13.11.2006.
10. Order of the Recovery Officer dated 25.03.2009 makes it clear
that the continuation of the services of the first respondent was only
on behalf of auction purchasers and that only the auction purchasers
were bound to pay the charges for security services to the first
respondent. The relevant portion of the order of the Recovery Officer
reads as under:-
“8……The Auction Purchasers have not filed any application to discharge
the said Agency, therefore, they have opted to continue the services, of
the said Agency, in exercise of their discretion and in furtherance of their
Page No. 9 of 15
Exh 225. This Tribunal would therefore not be inclined to accept the
prayer of CH to discharge the said Agency, as doing so is likely to
prejudice the Auction Purchaser’s rights, in the matter of preservation and
protection of the auctioned property, and violation of their rights, and
discretion, as the CH has no concern in the preservation or protection of
the auctioned property from 13.11.2006 i.e., since the Auction Purchasers
having filed Undertaking at Exh 225.
9……….The status of the said Agency as “Court Commissioner” appears
to be lost from 13.11.2006, as thereafter the “Court Commissioner”
appears to have continued to safeguard the auctioned property for and on
behalf of the Auction Purchasers, in furtherance of their private
arrangement, particularly in light of Exh 225 of the Auction Purchaser.
The term “Court Commissioner” as used by CH in its application Exh 308
therefore is a misnomer. The said Agency from 13.11.2006 does not
appear to have rendered services to the Auction Purchasers as “Court
Commissioner” but as a private agency………… The order of the Hon’ble
PO dated 24.07.2008, passed in Misc. Civil Appeal 25/2007 whereby, it
appears, relief is granted to the Auction Purchasers, who have been
directed to pay the Court Commissioner charges w.e.f. 08.05.2007.
Therefore, I am not required to go into the said aspects again, as the
same having reached finality, as from the available record and papers, no
appeal appears to be filed against the said order dated 24.07.2008….”
The above order of the Recovery Officer makes it clear that the
continuance of respondent No. 1 for safeguarding the auctioned
property was solely on behalf of auction purchasers and the first
respondent’s duty as “Court Commissioner” had ceased to exist on
13.11.2006. After 13.11.2006 or at least after 24.07.2008 (Order of
DRT), for the services of respondent No. 1, if any, were availed by the
auction purchasers, only the auction purchasers are liable to pay the
said charges to respondent No. 1. The appellant Bank, therefore, was
under no obligation to pay the charges to the first respondent in any
case after 24.07.2008. The High Court has not kept in view the order
of DRT dated 24.07.2008 and the order of the Recovery Officer dated
Page No. 10 of 15
25.03.2009. The High Court was not right in saying that DRT had no
jurisdiction to entertain the appeal and, therefore, the order dated
24.07.2008 would be non est.
11. After the above order of the Recovery Officer, respondent No. 1
filed MA No. 35 of 2009 before DRT seeking payment of charges for
security services from the auction purchasers as directed by DRT in
its order dated 24.07.2008 which clearly indicates that the first
respondent had accepted the said order of DRT and also acted upon
it. Be it noted, the proceedings of the Recovery Officer dated
25.03.2009 in which all the parties participated proceeded mainly on
the basis of the order of DRT dated 24.07.2008. But, strangely,
respondent No. 1 made submission before the High Court that
“….DRT had no jurisdiction to entertain Appeal No. 25/2007 against
the order of the Recovery Officer dated 12.06.2007……..”. The said
submission of respondent No. 1 was accepted by the High Court and
it was held that “………DRT had no jurisdiction to entertain Appeal No.
25/2007, the order dated 24.07.2008 passed by it …… would be non
est and hence must be ignored.” In our view, the High Court did not
keep in view that the respondent No. 1 had not challenged the order
of DRT dated 24.07.2008; and had acquiesced to the said order
dated 24.07.2008 and also acted upon it. As discussed earlier, the
Page No. 11 of 15
subsequent proceedings clearly show that respondent No. 1 and
other parties have accepted the order of DRT dated 24.07.2008 and
acted upon it. The findings of the High Court that DRT had no
jurisdiction to entertain the appeal against the order of Recovery
Officer cannot be sustained.
12. Next question falling for consideration is whether in the facts of
this case, the Micro, Small and Medium Enterprises Development
Act, 2006 would apply. As discussed earlier, the proceedings were
conducted before DRT under RDDBFI Act, 1993 which finally
culminated in DRT’s order dated 24.07.2008 and had become final
and binding and was also accepted and acted upon by respondent
No.1. As per Section 5 of the RDDBFI Act, the Debt Recovery
Tribunal is headed by the Presiding Officer who is or has been or is
qualified to be a District Judge. Likewise, as per Section 10 of the
said Act, the Appellate Tribunal is headed by the Chairperson who is
or has been or is qualified to be a judge of a High Court. DRT and
DRAT are not merely having the trappings of the courts but also
vested with the powers of ordinary civil court including the power to
summon and examine the witnesses on oath, the power to order
inspection of the documents etc. When the proceedings were
lawfully conducted before the quasi-judicial authorities like DRT and
Page No. 12 of 15
DRAT, having trappings of the civil court, MSMEDF Council had no
jurisdiction to entertain the application filed by the first respondent;
more so, when the orders passed by the DRT were accepted and
acted upon by respondent No.1. The High Court did not consider the
question of lack of jurisdiction of MSMEDF Council.
13. The High Court mainly seems to have proceeded with the
matter as if it is a regular appeal arising out of the award passed by
the MSMEDF Council and commenting upon the conduct of the Bank
in not seriously pursuing the matter in challenging the award. The
High Court did not consider the earlier proceedings before DRT,
DRAT and before the High Court except merely referring to certain
proceedings before DRT and DRAT. The High Court did not consider
various orders passed by DRT and DRAT and the conduct of the
parties who have been vigorously pursuing the matter before DRT,
Recovery Officer and DRAT. The High Court also did not keep in
view that the parties were bound by the earlier orders passed by DRT
and Recovery Officer which clearly held that charges towards security
services are payable only by the auction purchasers. The impugned
order passed by the High Court thus suffers from serious infirmity and
is liable to be set aside.
Page No. 13 of 15
14. Pursuant to the order dated 19.03.2013 passed by the High
Court, an amount of Rs.1,93,22,590/- was deposited by the appellant
Bank. By an order dated 30.03.2016 passed by DRT, Pune,
respondent No.1 has withdrawn an amount of Rs.1,22,00,000/-
(Rs.1,00,00,000/- plus accrued interest). The balance amount of
Rs.93,22,590/- is lying in deposit with the District Court, Pune. By
order dated 22.04.2016, this Court has granted interim stay of the
impugned order of the High Court. However, by order dated
24.10.2016, respondent No.1 was permitted to withdraw 50% of the
said amount Rs.93,22,590/- on furnishing a bank guarantee. The first
respondent has not withdrawn the said 50% amount of
Rs.93,22,590/- as he has failed to furnish bank guarantee. We have
set aside the impugned judgment of the High Court and resultantly
the award passed by the MSMEDF Council is also set aside.
15. The impugned order is set aside and this appeal is allowed.
The appellant Bank is free to recover the amount of Rs.1,22,00,000/-
withdrawn by the first respondent after adjusting the payments due
upto 24.07.2008. The bank is permitted to withdraw the amount of
Rs.93,22,590/- along with accrued interest. So far as the charges
towards security services payable to the first respondent after
24.07.2008, liberty is granted to the first respondent to proceed
Page No. 14 of 15
against the auction purchasers-respondents No. 2 and 3 in
accordance with law. No order as to costs.
…….……………………J.
[KURIAN JOSEPH]
…………….……………J.
[R. BANUMATHI]
New Delhi;
December 5, 2017
Page No. 15 of 15

Posted in Uncategorized

Specific Performance – In my view section 48(d) of the said Act of 1960 will not affect the legality of the suit agreement. In view of section 54 of the Transfer of Property Act, 1882 agreement for sale does not create any interest in favour of the purchaser in respect of the immovable property. Therefore, agreement for sale cannot be treated as alienation or transfer within the meaning of clause (d) of section 48 of the said Act of 1960. Apart from this fact, the Appellate court has observed that the original Defendant Nos. 1 and 2 have agreed to sell only a small portion of the property over which charge has been created in favour of the Land Development Bank and part of the loan has been repaid. 4. So far as the second submission regarding readiness and willingness is concerned, I find that the Appellate Court has discussed the entire evidence. The Appellate Court after considering the pleadings and oral and documentary evidence on record has come to the conclusion that the Plaintiff has established his readiness and willingness to 6 perform his part of the contract. The Appellate Court has observed that if at all any permission for transfer was to be obtained, the same was the obligation of the Defendants. So far as the bar of limitation is concerned, I find that in the Appellate Court the said issue was not specifically raised. The same was the case with the trial Court. The issue of limitation is a mixed question of law and fact considering the relevant provisions of the Limitation Act, 1963 which deal with the limitation for suit for specific performance.”

REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL No.6069 OF 2008
Balwant Vithal Kadam ….Appellant(s)
VERSUS
Sunil Baburaoi Kadam …Respondent(s)
J U D G M E N T
Abhay Manohar Sapre, J.
1. This appeal is filed by the defendants against
the final judgment and order dated 24.07.2006
passed by the High Court of Bombay in Second
Appeal No. 426 of 2004 whereby the High Court
dismissed the second appeal filed by the appellants
herein and affirmed the judgment and order dated
03.10.2002 passed by the 8th Additional District
Judge, Satara in R.C.A. No.9/1996, which arose out
of judgment/decree dated 29.11.1995 passed by the
1
2
nd Joint Civil Judge, Satara in R.C.S. No. 265 of
1989.
2. In order to appreciate the controversy, which
lies in a narrow compass, few relevant facts need
mention hereinbelow.
3. The appellants are the defendants whereas the
respondent is the plaintiff in a suit out of which this
appeal arises.
4. The respondent filed a suit being Civil Suit No.
265/89 in the Court of 2nd Joint Civil Judge, Satara
against the appellants for specific performance of
the two agreements, dated 11.10.1982(Ex.48) and
11.04.1983(Ex.68) to purchase 1/12th share of the
appellants in the land which belonged to them
situated at Eastern potion of Gat. No.594/1
admeasuring 2 hectares 18 Acre situated at
Malegaon Taluka and District Satara(hereinafter
referred to as “suit land”).
2
5. The sale consideration was fixed at
Rs.10,000/-. The respondent had paid Rs.3,000/-
by way of earnest money to the appellants. The sale
deed was to be executed within 6 months. Since the
dispute arose between the parties and no sale deed
was executed, the respondent filed a suit to seek
specific performance of the said agreement against
the appellants in relation to the suit land.
6. The appellants contested the suit by filing their
written statement. Parties adduced evidence. The
Trial Court, by judgment/decree dated 29.11.1995
in R.C.S. No.265/1989, dismissed the suit.
7. The respondent (plaintiff) felt aggrieved and
filed first appeal being Regular Civil Appeal No.
9/1996 in the Court of VIIIth Additional District
Judge, Satara. By judgment/decree dated
03.10.2002, the VIIIth Additional District Judge,
allowed the appeal, set aside the judgment/decree
of the Trial Court and decreed the respondent’s suit.
3
8. Felt aggrieved, the appellants (defendants) filed
second appeal in the High Court of Bombay being
S.A. No. 426/2004. By impugned judgment/decree,
the High Court dismissed the defendants’ second
appeal, which has given rise to filing of the present
appeal by way of special leave in this Court by the
defendants.
9. Initially, there were two appellants. By order
dated 28.10.2013 passed by this Court, the appeal
against appellant No.1 was held abated.
10. Heard Mr. Sudhanshu Chaudhari, learned
counsel for the appellant and Mr. Varun Mathur,
learned counsel for the respondent.
11. Learned counsel for the appellant (defendant
No.2) while assailing the legality and correctness of
the impugned judgment argued that, firstly, the
respondent’s suit was misconceived inasmuch as no
specific performance in relation to the agreement in
question was permissible in the light of bar created
by Section 31 of the Bombay Prevention of
4
Fragmentation and Consolidation of Holdings Act
(hereinafter referred to as “the Act”) which,
according to learned counsel, prohibited any
transfer of holding and, more particularly, a
fragment such as the one in the case at hand.
12. In the second place, learned counsel attacked
the findings of the High Court recorded on three
pleas raised by the appellant in the second appeal
and contended that all the three pleas deserve to be
upheld in appellant’s favour.
13. Learned counsel for the respondent, in reply,
supported the reasoning and the conclusion of the
High Court and contended that the impugned
judgment does not call for any interference and
hence deserves to be upheld.
14. Having heard the learned counsel for the
parties and on perusal of the record of the case, we
are inclined to dismiss the appeal finding no merit
therein.
5
15. This is how the High Court dealt with three
pleas in the impugned judgment:
“2. Shri Thorat appearing for the Appellants
submitted that as the suit agreement for sale
was executed in contravention of section
48(d) of the Maharashtra Cooperative
Societies Act, 1960 the agreement itself was
void and therefore, specific performance of
the agreement could not have been granted.
He submitted that the finding of the trial
Court on the issue of readiness and
willingness of the original Plaintiff has been
upset by the Appellate Court without dealing
with the reasoning of the trial Court. Lastly
he submitted that the suit filed by the
original Plaintiff was barred by limitation.
3. I have considered the submissions. In my
view section 48(d) of the said Act of 1960 will
not affect the legality of the suit agreement.
In view of section 54 of the Transfer of
Property Act, 1882 agreement for sale does
not create any interest in favour of the
purchaser in respect of the immovable
property. Therefore, agreement for sale
cannot be treated as alienation or transfer
within the meaning of clause (d) of section 48
of the said Act of 1960. Apart from this fact,
the Appellate court has observed that the
original Defendant Nos. 1 and 2 have agreed
to sell only a small portion of the property
over which charge has been created in favour
of the Land Development Bank and part of
the loan has been repaid.
4. So far as the second submission regarding
readiness and willingness is concerned, I find
that the Appellate Court has discussed the
entire evidence. The Appellate Court after
considering the pleadings and oral and
documentary evidence on record has come to
the conclusion that the Plaintiff has
established his readiness and willingness to
6
perform his part of the contract. The
Appellate Court has observed that if at all any
permission for transfer was to be obtained,
the same was the obligation of the
Defendants. So far as the bar of limitation is
concerned, I find that in the Appellate Court
the said issue was not specifically raised. The
same was the case with the trial Court. The
issue of limitation is a mixed question of law
and fact considering the relevant provisions
of the Limitation Act, 1963 which deal with
the limitation for suit for specific
performance.”
16. In our considered opinion, no fault could be
found in the three findings of the High Court
recorded on three pleas as the reasoning and the
conclusion arrived at by the High Court is just and
proper calling for no interference by this Court in
the appeal.
17. So far as the plea relating to validity and
enforceability of the agreement in question is
concerned, it was rightly held by the High Court to
which we concur that the agreement in question is
not hit by Section 48 of the Maharashtra
Co-operative Society Act inasmuch as the
agreement to sell in itself does not create any
7
interest in the land nor does it amount to sale
under Section 54 of the T.P. Act. It only enables the
intending buyer to claim specific performance of
such agreement on proving its terms. In other
words, there lies a distinction between an
agreement to sell, and sale. The latter creates an
interest in the land once accomplished as defined
under Section 54 of the T.P. Act. It was also
rightly held on facts to which we concur that since
the dues of the Land Development Bank were
repaid, the question of applicability of Section 48
did not arise. We, therefore, find no ground to
disagree with this factual finding.
18. So far as the plea relating to readiness and
willingness is concerned, it was again rightly held
by the High Court to which we concur that this
being a finding of fact, it could not be disturbed in
second appeal and was binding on the High Court.
It was more so when the first Appellate Court had
recorded its finding by appreciating the entire
8
evidence on record. We, therefore, find no ground to
disagree with this finding of the High Court.
19. So far as the plea relating to limitation is
concerned, it was rightly held by the High Court to
which we again concur that, firstly, it was neither
raised before the Trial Court and nor before the first
Appellate Court; and secondly, it being a mixed
question of law and fact, the same could not be
examined, for the first time, in second appeal by the
High Court. We agree with the finding of the High
Court calling for no interference.
20. Now, so far as the plea relating to applicability
of Section 31 of the Act to the agreement in question
is concerned, the appellant, in our view, cannot be
permitted to raise such plea, for the first time, in
this appeal.
21. It is for the reason that, firstly, this plea was
neither raised by the appellant before the Trial
Court and nor before the first Appellate Court and
lastly, nor before the High Court.
9
22. Secondly, in order to enable the appellant to
raise any challenge to any plea, the party concerned
has to first lay foundation in the pleadings of such
plea which, in this case, was not. It is more so
when a plea is a mixed question of law and fact.
23. This Court being the last Court of appeal does
not, therefore, consider it proper to allow the
appellant to raise such plea, for the first time, under
Article 136 of the Constitution in this appeal.
24. Learned counsel for the appellant, however,
contended that the appellant had raised this point
in the arguments before the High Court but the
same was not considered. We do not find it to be so.
When we read the impugned judgment, we find that
the High Court has specifically noted in Para 2 the
three pleas raised by the appellant, which did not
include this plea.
25. Learned counsel for the appellant next
contended that the agreements in question were not
meant for sale of the land but were in the nature of
10
security for the loan transaction entered between
the parties. We are afraid we can go into this
question in this appeal. It is again for the reason
that firstly, it is a question of fact and secondly, it
was not urged before the High Court.
26. In the light of foregoing discussion, we find no
merit in any of the submissions urged by the
learned counsel for the appellant dealt with supra.
27. As a result, the appeal is found to be devoid of
any merit and thus it fails and is accordingly
dismissed.

……………………………………..J.
[ABHAY MANOHAR SAPRE]

 

……………………………………….J.
[NAVIN SINHA]
New Delhi;
December 05, 2017
11

Posted in Uncategorized

income tax – “When once the eligible business of an assessee is given the benefit of deduction under Section 80 IB on the assessee satisfying the conditions mentioned in sub-sec. (2) of Section 80 IB, can the assessee be denied the benefit of the said deduction on the ground that during the said 10 consecutive years, it ceases to be a small scale industry?” yes – we hold that the assessee is not entitled to benefit of exemption if it loses its eligibility as a small scale industrial undertaking in a particular assessment year even if in initial year eligibility was satisfied.

 

1
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 20854 OF 2017
(ARISING OUT OF SPECIAL LEAVE PETITION (CIVIL) NO.4565 OF 2015)
DEPUTY COMMISSIONER OF INCOME-TAX,
CIRCLE 11 (1), BANGALORE …APPELLANT
VERSUS
M/S. ACE MULTI AXES SYSTEMS LTD. …RESPONDENTS
WITH
CIVIL APPEAL NO. 20856 OF 2017
(ARISING OUT OF SPECIAL LEAVE PETITION (CIVIL) NO.8331 OF 2016)
WITH
CIVIL APPEAL NO. 20857 OF 2017
(ARISING OUT OF SPECIAL LEAVE PETITION (CIVIL) NO.3323 OF 2016)
WITH
CIVIL APPEAL NO. 20855 OF 2017
(ARISING OUT OF SPECIAL LEAVE PETITION (CIVIL) NO.148 OF 2016)
J U D G M E N T
ADARSH KUMAR GOEL, J.
Civil Appeal No. 20854 of 2017
(@ Special Leave Petition(Civil) No.4565 of 2015)
1. Leave granted. This appeal has been preferred against the
judgment and order dated 28th July, 2014 of the High Court of
Karnataka at Bangalore in Income Tax Appeal No.477 of 2013. The
High Court framed the following question of law for consideration :
2
“When once the eligible business of an assessee is
given the benefit of deduction under Section 80 IB on
the assessee satisfying the conditions mentioned in
sub-sec. (2) of Section 80 IB, can the assessee be
denied the benefit of the said deduction on the
ground that during the said 10 consecutive years, it
ceases to be a small scale industry?”
2. The High Court answered the question in the negative and in
favour of the assessee. The revenue has questioned the said view.
3. The respondent assessee is engaged in manufacture and sale
of components/parts of CNC lathes and similar machines. Its
income was assessed for the assessment year 2005-2006 at
Rs.1,79,82,653/-. However, the Commissioner of Income Tax,
interfered with the assessment under Section 263 to the extent it
allowed deduction under Section 80 IB(3) of the Income Tax Act,
1961 (the Act) and directed fresh decision on the said issue vide
order dated 16th January, 2009. Thereafter, the Assessing
authority on 14th December, 2009 disallowed the claim of
Rs.75,81,910/- towards deduction under Section 80 (B(3). The
same was upheld by the Commissioner in appeal and the Income
Tax Appellate Tribunal in second appeal. However, the High Court
has reversed the said orders and upheld the claim.
4. The relevant Section is as follows :
3
“80-IB. Deduction in respect of profits and
gains from certain industrial undertakings
other than infrastructure development
undertakings – (1) Where the gross total income of
an assessee includes any profits and gains derived
from any business referred to in sub-sections (3) to
(11), (11A) and (11B) (such business being
hereinafter referred to as the eligible business),
there shall, in accordance with and subject to the
provisions of this section, be allowed, in computing
the total income of the assessee, a deduction from
such profits and gains of an amount equal to such
percentage and for such number of assessment
years as specified in this section.
(2) This section applies to any industrial undertaking
which fulfils all the following conditions, namely :—
(i) it is not formed by splitting up, or the
reconstruction, of a business already in
existence:
Provided that this condition shall not apply in
respect of an industrial undertaking which is
formed as a result of the re-establishment,
reconstruction or revival by the assessee of the
business of any such industrial undertaking as
is referred to in section 33B, in the
circumstances and within the period specified
in that section;
(ii) it is not formed by the transfer to a new
business of machinery or plant previously used
for any purpose;
(iii) it manufactures or produces any article or
thing, not being any article or thing specified in
the list in the Eleventh Schedule, or operates
one or more cold storage plant or plants, in
any part of India :
Provided that the condition in this clause
shall, in relation to a small scale industrial
undertaking or an industrial undertaking
referred to in sub-section (4) shall apply as if
the words “not being any article or thing
4
specified in the list in the Eleventh Schedule”
had been omitted.
Explanation 1.—For the purposes of clause (ii),
any machinery or plant which was used outside
India by any person other than the assessee
shall not be regarded as machinery or plant
previously used for any purpose, if the
following conditions are fulfilled, namely :—
(a) such machinery or plant was not, at any
time previous to the date of the installation by
the assessee, used in India;
(b) such machinery or plant is imported into
India from any country outside India; and
(c) no deduction on account of depreciation in
respect of such machinery or plant has been
allowed or is allowable under the provisions of
this Act in computing the total income of any
person for any period prior to the date of the
installation of the machinery or plant by the
assessee.
Explanation 2.—Where in the case of an
industrial undertaking, any machinery or plant
or any part thereof previously used for any
purpose is transferred to a new business and
the total value of the machinery or plant or
part so transferred does not exceed twenty per
cent of the total value of the machinery or
plant used in the business, then, for the
purposes of clause (ii) of this sub-section, the
condition specified therein shall be deemed to
have been complied with;
(iv) in a case where the industrial undertaking
manufactures or produces articles or things,
the undertaking employs ten or more workers
in a manufacturing process carried on with the
aid of power, or employs twenty or more
workers in a manufacturing process carried on
without the aid of power.
5
(3) The amount of deduction in the case of an
industrial undertaking shall be twenty-five per cent
(or thirty per cent where the assessee is a company),
of the profits and gains derived from such industrial
undertaking for a period of ten consecutive
assessment years (or twelve consecutive
assessment years where the assessee is a
co-operative society) beginning with the initial
assessment year subject to the fulfilment of the
following conditions, namely :—
(i) it begins to manufacture or produce,
articles or things or to operate such plant or
plants at any time during the period beginning
from the 1st day of April, 1991 and ending on
the 31st day of March, 1995 or such further
period as the Central Government may, by
notification in the Official Gazette, specify with
reference to any particular undertaking;
(ii) where it is an industrial undertaking being
a small scale industrial undertaking, it begins
to manufacture or produce articles or things or
to operate its cold storage plant [not specified
in sub-section (4) or sub-section (5)] at any
time during the period beginning on the 1st
day of April, 1995 and ending on the 31st day
of March, 2002.
(4) to (13) xxx xxx xxx
(14) For the purposes of this section,—
(a) “built-up area” means the inner
measurements of the residential unit at the
floor level, including the projections and
balconies, as increased by the thickness of the
walls but does not include the common areas
shared with other residential units;
(aa) “cold chain facility” means a chain of facilities
for storage or transportation of agricultural
produce under scientifically controlled
conditions including refrigeration and other
facilities necessary for the preservation of such
produce;
6
(ab) “convention centre” means a building of a
prescribed area comprising of convention halls
to be used for the purpose of holding
conferences and seminars, being of such size
and number and having such other facilities
and amenities, as may be prescribed;
(b) “hilly area” means any area located at a
height of one thousand metres or more above
the sea level;
(c) “initial assessment year”—
(i) in the case of an industrial undertaking or
cold storage plant or ship or hotel, means the
assessment year relevant to the previous year
in which the industrial undertaking begins to
manufacture or produce articles or things, or to
operate its cold storage plant or plants or the
cold chain facility or the ship is first brought
into use or the business of the hotel starts
functioning;
(ii) in the case of a company carrying on
scientific and industrial research and
development, means the assessment year
relevant to the previous year in which the
company is approved by the prescribed
authority for the purposes of sub-section (8);
(iii) in the case of an undertaking engaged in
the business of commercial production or
refining of mineral oil referred to in sub-section
(9), means the assessment year relevant to
the previous year in which the undertaking
commences the commercial production or
refining of mineral oil;
(iv) in the case of an undertaking engaged in
the business of processing, preservation and
packaging of fruits or vegetables or in the
integrated business of handling, storage and
transportation of foodgrains, means the
assessment year relevant to the previous year
in which the undertaking begins such business;
7
(v) in the case of a multiplex theatre, means
the assessment year relevant to the previous
year in which a cinema hall, being a part of the
said multiplex theatre, starts operating on a
commercial basis;
(vi) in the case of a convention centre, means
the assessment year relevant to the previous
year in which the convention centre starts
operating on a commercial basis;
(vii) in the case of an undertaking engaged in
operating and maintaining a hospital in a rural
area, means the assessment year relevant to
the previous year in which the undertaking
begins to provide medical services;
(d) “North-Eastern Region” means the region
comprising the States of Arunachal Pradesh,
Assam, Manipur, Meghalaya, Mizoram,
Nagaland, Sikkim and Tripura;
(da) “multiplex theatre” means a building of a
prescribed area, comprising of two or more
cinema theatres and commercial shops of such
size and number and having such other
facilities and amenities as may be prescribed;
(e) “place of pilgrimage” means a place where
any temple, mosque, gurdwara, church or
other place of public worship of renown
throughout any State or States is situated;
(f) “rural area” means any area other than—
(i) an area which is comprised within the
jurisdiction of a municipality (whether known
as a municipality, municipal corporation,
notified area committee, town area committee
or by any other name) or a cantonment board
and which has a population of not less than ten
thousand according to the preceding census of
which relevant figures have been published
before the first day of the previous year; or
8
(ii) an area within such distance not being
more than fifteen kilometres from the local
limits of any municipality or cantonment board
referred to in sub-clause (i), as the Central
Government may, having regard to the stage
of development of such area including the
extent of, and scope for, urbanisation of such
area and other relevant considerations specify
in this behalf by notification in the Official
Gazette;
(g) “small-scale industrial undertaking” means
an industrial undertaking which is, as on the
last day of the previous year, regarded as a
small-scale industrial undertaking under
section 11B of the Industries (Development
and Regulation) Act, 1951 (65 of 1951).”
5. Before we consider the issue of correct interpretation of the
above provision, it may be necessary to note the observations of
the statutory authorities and the High Court on the issue.
6. The assessment order dated 14th December, 2009, disallowing
the deduction is as follows :
“The same is not acceptable on the ground that the
value of plant and machinery has exceeded Rs.1
crores as per the depreciation schedule annexed to
the 3CD report which do not come under the purview
of the definition of small scale industry for the year
ending 04-05 (A.Y.05-06).
In view of the above, I am constrained to hold that
the assessee company is not eligible for claim of
80IB(3) deduction amounting to Rs.75,81,910/- and
hence same is disallowed.”
7. The Commissioner of Income Tax (Appeals) in order dated 15th
February, 2011 observed :
9
“I agree with the learned CIT who while passing the
order u/s 263 has pointed out that the industrial
undertaking, here initially SSI unit, has to fulfil all
conditions in each of the block years of its
entitlement or otherwise such claim has to be denied.
He rightly points out that Section 80 IB(3) only forms
the basis of entitlement and its scope. The first
condition is that it must be a SSI unit in the year of
claim and entitlement Section 80 IB (14)(g) defines
what is a SSI and an exact date has been prescribed
therein so that AO can examine whether on that date
it is an SSI or not. The date is the last day of the
relevant previous year in this case 31.03.2005 and
such date is exclusively for the purpose of this section
only. Admittedly the investment in plant and
machinery on 31.03.2005 was i.e., Rs.4,05,21,730/-
which was more than the prescribed limit of that year
i.e., 1 crore. Hence it no longer remains a SSI and
hence the disallowance has to be held justified.
xxx xxx xxx
17. Summary:
Section 80 IB is an incentive provision. It stipulates
deduction in respect of profits and gains from certain
industrial undertakings. Within this section a plethora
of industries and business types have been given the
benefit of such deduction if they fulfill the conditions
mentioned in the concerned sub section of Section
80IB of the Act. Some of such concerns/industries are
ship, hotel multiplex, theatres, housing projects etc.
Sub-Section (2) of Section 80IB provides such
conditions for industrial undertakings including cold
storage and cold chain facility and also Small Scale
Industrial undertakings (in short henceforth SSIU). All
the four conditions mentioned in Section 80IB (2)
must be fulfilled to make the industrial undertaking
eligible for the benefit of the claim u/s 80IB of the I.T.
Act. Condition No.1 is that the industrial undertaking
must not have been formed by splitting up or
reconstruction of a business already in existence with
an exception that in case of units specified u/s 33B of
the I.T. Act this condition will not apply. The second
condition is that such undertaking must not have
10
been formed by transfer of machinery or plant
previously used with the exception that the value of
such machinery and plant previously used must not
exceed 20% of the value of the total cost of the plant
and machinery of such industrial undertaking. The
third condition is that the industrial undertaking must
produce or manufacture any article or thing other
than any article or thing specified in the Eleventh
Schedule. Exception to this third condition is that an
SSIU can avail the 80IB benefit even if manufactures
or produces articles or things specified in Eleventh
Schedule. The fourth condition is that the industrial
undertaking running with the aid of power must not
have less than 10 employees and if it is run without
power, the number of employees must be more than
20 employees. Thus all the four conditions
narrated above must be fulfilled if the
industrial undertaking desires to avail benefit
u/s 80IB of the I.T. Act. For a SSIU there is also
an extra condition i.e., it must be an SSI unit as
per explanation (g) given in 80IB (14) of I.T. Act
which refers to Section 11B of the IDR Act 1951
which in turn prescribes a limit for investment
in plant and machinery to designate the
industrial undertaking as SSI unit. Thus out of
these five conditions, the first two conditions
may be called static or unchangeable. In other
words if in the initial year of manufacture or
production it is substantiated that it has
fulfilled these two conditions the A.O. cannot
on this ground in subsequent eligible years of
the block period deny the benefit u/s 80IB. The
rest three conditions are volatile and unstable.
The industrial undertaking must show in each
subsequent year of claim that these three
conditions have not been violated. Such claims
of the assessee has to face the analysis and
scrutiny of the A.O. Thus, since each A.Y. is
separate and independent, the revenue
authorities had every power to examine and
analyse the facts and figures as well as
relevant law points of each year to find out
whether all these three conditions are fulfilled
or not. It is also the ratio of the cited case of Natraj
Stationery 312 ITR 22 (Delhi) vide page 14 supra. It
has been stated in that case that the first two
11
conditions have already been satisfied and it is
assumed that the fourth condition has been fulfilled
in that year and hence the relief. The same is also
the ratio in the case of – M/s. Janak Dehydration
(P) Limited vs. Asst. CIT (2010) 134 TTJ Ahd.
D-Trib-1. The facts of that case was that the assessee
was allowed deduction u/s 80IB from 1993-94 to
2002-03 but in the A.Y. 2003-04 the claim was
disallowed on the ground that in the initial year the
industrial unit has been formed by reconstruction or
splitting up of the existing unit. The ITAT held that it
is not open to the A.O. to doubt the earlier
acceptance of the department in respect of
reconstruction and splitting up to deny the claim in
subsequent year because that violates the principles
of consistency. But it also laid down that –
“Under the I.T. Act each year is a
separate unit of assessment and
taxable income as well as tax
liability are to be determined
keeping in view of the facts
prevailing in that year and the law
as applicable in that year.”
In the light of the above legal matrix as elaborated in
Para 15 above it can be palpably seen that the
appellant has violated, the mandatory fifth condition.
It is not doubted that in the initial A.Y. the appellant
was an SSI unit, but in the A.Y. 2005-06 the
investment in plant and machinery has admittedly
exceeded the prescribed limit of Rs.1 Crore.
Therefore, it cannot be held as an SSIU. Thus the fifth
condition being violated openly and admittedly by the
appellant, the relief sought for has to be denied in the
A.Y. 2005-06.
18. In view of the above, addition/disallowance is
upheld. Appeal is dismissed.”
8. The ITAT in its order dated 24th May, 2013 observed :
12
“5.3.6. Taking into account all the facts and
circumstances of the issue as discussed in the
foregoing paragraphs and also, as rightly
highlighted by the AO, the value of plant and
machinery had exceeded Rs.1 crore during the
year under consideration which incidentally
deprive the assessee to call itself as a Small
Scale Industry, we are of the considered view
that the authorities below were justified in
denying the assessee’s claim for deduction u/s
80-IB(3) of the Act. It is ordered accordingly.”
9. Considering the question framed by it, the High Court held :
“5. In the entire provision, there is no indication
that these conditions had to be fulfilled by the
assessee all the 10 years. When once the benefit of
10 years, commencing from the initial year, is
granted, if the undertaking satisfy all these
conditions initially, the undertaking is entitled to the
benefit of 10 consecutive years. The argument that,
in the course of 10 years, if the growth of the
industry is fast and it acquires machinery and the
total value of the machinery exceeds Rs.1 crore, it
ceases to have the said benefit, do not follow from
any of the provisions. It is true that there is no
express provision indicating either way, what would
be the position if the small scale industry ceases to
be a small scale industry during the said period of 10
years. Because of that ambiguity, a need for
interpretation arises. If we keep in mind the object of
the Legislature providing for these incentives and
when a period of 10 years is prescribed, that is the
period, probably, which is required for any industry
to stabilize itself. During that period the industry not
only manufactures products, it generates
employment and it adds to the wealth of the country.
Merely because an industry stabilizes early,
makes profits, makes future investment in the
said business, and it goes out of the definition
of the small scale industry, the benefit under
Sec. 80IB cannot be denied. If such a literal
interpretation is placed on the said provision, it
13
would run counter to the very object of granting
incentives. It would kill the industry. Therefore,
keeping in mind the object with which these
provisions are enacted, keeping in mind the
industrial growth which is required to be achieved, if
two interpretations are possible, the courts have to
lean in favour of extending the benefit of deduction
to an assessee who has availed the opportunity
given to him under law and has grown in his
business. Therefore we are of the view, if a small
scale industry, in the course of 10 years, stabilizes
early, makes further investments in the business and
it results in it’s going outside the purview of the
definition of a small scale industry, that should not
come in the way of its claiming benefit under
Sec.80IB for 10 consecutive years, from the initial
assessment year. Therefore, the approach of the
authorities runs counter to the scheme and the
intent of the Legislature. Thereby they have denied
the legitimate benefit, an incentive granted to the
assessee. Both the said orders cannot be sustained.
Therefore the substantial question of law is
answered in favour of the assessee and against the
Revenue.” (emphasis in
quotations is ours)
10. Section 80 IB is in Chapter VI A of the Act which provides for
deductions to be allowed from total income which is to be
computed under the relevant provisions. The scheme is to provide
incentives for purposes mentioned in different provisions of the
said Chapter. Section 80 IB provides for deductions of specified
percentage from the profits and gains of the specified industrial
undertakings other than infrastructure development undertakings
(which are separately dealt with under Section 80 IA). The clause
relevant for purposes of this appeal is Clause 2 which makes the
14
deductions permissible in respect of industrial undertakings
fulfilling the conditions specified therein. The scheme applies to
small scale industrial undertakings as defined in Clause 14(g)
which in terms refers to Section 11 B of the Industries
(Development and Regulation) Act, 1951. The extent of deduction
permissible is mentioned in Clause 3 which is 25% (30% in the
case of a company) of the profits and gains derived from such
industrial undertakings for 10 consecutive assessment years
beginning with the initial assessment. The ‘initial assessment
year’ is defined in Clause 14 (c) as the year in which
manufacturing/production commences.
11. As already noted, the question for consideration is whether
deduction under Clause 3 for 10 consecutive assessment years
remains permissible irrespective of compliance of conditions
subject to which the said deduction is permitted in the relevant
assessment years. For purposes of deduction, the industrial
undertakings covered by Section 80 IB are of different categories.
Under the second proviso to Clause 2, disqualification applicable to
industrial undertaking, other than small scale industrial
undertakings, i.e., not being in 8th Schedule is not applicable. The
15
small scale industrial undertakings eligible are only those which
begin manufacture or produce, articles or things during the
beginning of 1st day of April, 1995 and ending on 31st day of
March, 2002 [Clause 3(ii)]. For other categories of industrial
undertakings, different periods are prescribed, e.g. under
sub-clause (i) of Clause (3).
12. The scheme of the statute does not in any manner indicate
that the incentive provided has to continue for 10 consecutive
years irrespective of continuation of eligibility conditions.
Applicability of incentive is directly related to the eligibility and not
de hors the same. If an industrial undertaking does not remain
small scale undertaking or if it does not earn profits, it cannot
claim the incentive. No doubt, certain qualifications are required
only in the initial assessment year, e.g. requirements of initial
constitution of the undertaking. Clause 2 limits eligibility only to
those undertakings as are not formed by splitting up of existing
business, transfer to a new business of machinery or plant
previously used. Certain other qualifications have to continue to
exist for claiming the incentive such as employment of particular
number of workers as per sub-clause 4(i) of Clause 2 in an
16
assessment year. For industrial undertakings other than small scale
industrial undertakings, not manufacturing or producing an article
or things specified in 8th Schedule is a requirement of continuing
nature.
13. On examination of the scheme of the provision, there is no
manner of doubt that incentive meant for small scale industrial
undertakings cannot be availed by industrial undertakings which
do not continue as small scale industrial undertakings during the
relevant period. Needless to say, each assessment year is a
different assessment year, except for block assessment
14. The observations in the impugned order are that the object of
legislature is to encourage industrial expansion which implies that
incentive should remain applicable even where on account of
industrial expansion small scale industrial undertakings ceases to
be small scale industrial undertakings. We are unable to
appreciate the logic for these observations. Incentive is given to a
particular category of industry for a specified purpose. An incentive
meant for small scale industrial undertaking cannot be availed by
an assessee which is not such an undertaking. It does not, in any
manner, mean that the object of permitting industrial expansion is
17
defeated, if benefit is not allowed to other undertakings. On this
logic, incentive must be given irrespective of any condition as the
incentive certainly helps further expansion by reducing the tax
burden. The concept of vertical equity is well known under which
all the assessees need not be uniformally taxed. Progressive
taxation is a well known element of tax policy. Higher slabs of tax
or higher tax burden on an assessee having higher income or
higher capacity cannot in any manner, be considered
unreasonable.
15. We may now refer to some of the decisions which have been
cited at the bar. It is submitted on behalf of the assessee that a
provision relating to incentive should be construed liberally to
advance the objective of the provision. Reliance has been placed
on Bajaj Tempo Ltd. versus CIT1
. Therein the assessee claimed
exemption meant for a new industrial undertaking which had not
been formed by transfer of earlier business in terms of Section 15C
of the Income Tax Act, 1922. After recording a finding of fact that
the assessee was a genuine new industrial undertaking, it was
observed that a provision of a taxing statute granting incentive for
promoting growth and development should be construed liberally.
1 (1992) 196 ITR 188 (SC) = (1992) 3 SCC 78
18
The judgment is distinguishable. Construing liberally does not
mean ignoring conditions for exemption. The main issue
considered in the said judgment was that though the undertaking
was a genuine ‘new industrial undertaking’ which was the
qualification for the exemption, a nominal part of the undertaking
was out of the existing undertaking and building of an existing
undertaking was taken on lease. The relevant observations are :
“9. Initial exercise, therefore, should be to find out if
the undertaking was new. Once this test is satisfied
then clause (i) should be applied reasonably and
liberally in keeping with spirit of Section 15-C(1) of
the Act. While doing so various situations may arise
for instance the formation may be without anything
to do with any earlier business. That is the
undertaking may be formed without splitting up or
reconstructing any existing business or without
transfer of any building material or plant of any
previous business. Such an undertaking undoubtedly
would be eligible to benefit without any difficulty. On
the other extreme may be an undertaking new in its
form but not in substance. It may be new in name
only. Such an undertaking would obviously not be
entitled to the benefit. In between the two there may
be various other situations. The difficulty arises in
such cases. For instance a new company may be
formed, as was in this case a fact which could not be
disputed, even by the Income Tax Officer. But tools
and implements worth Rs 3,500 were transferred to
it of previous firm. Technically speaking it was
transfer of material used in previous business. One
could say as was vehemently urged by the learned
counsel for the department that where the language
of statute was clear there was no scope for
interpretation. If the submission of the learned
counsel is accepted then once it is found that the
material used in the undertaking was of a previous
business there was an end of inquiry and the
19
assessee was precluded from claiming any benefit.
Words of a statute are undoubtedly the best guide.
But if their meaning gets clouded then courts are
required to clear the haze. Sub-section (2) advances
the objective of sub-section (1) by including in it
every undertaking except if it is covered by clause (i)
for which it is necessary that it should not be formed
by transfer of building or machinery. The restriction
or denial of benefit arises not by transfer of building
or material to the new company but that it should
not be formed by such transfer. This is the key to the
interpretation. The formation should not be by such
transfer. The emphasis is on formation not on use.
Therefore it is not transfer of building or material but
the one which can be held to have resulted in
formation of the undertaking. In Textile Machinery
Corporation Ltd. v. CIT [(1977) 2SCC 368] this Court
while interpreting Section 15-C observed : (SCC p.
375, para 18)
“The true test, is not whether the new
industrial undertaking connotes
expansion of the existing business of
the assessee but whether it is all the
same a new and identifiable
undertaking separate and distinct from
the existing business. No particular
decision in one case can lay down an
inexorable test to determine whether a
given case comes under Section 15-C
or not. In order that the new
undertaking can be said to be not
formed out of the already existing
business, there must be a new
emergence of a physically separate
industrial unit which may exist on its
own as a viable unit. An undertaking is
formed out of the existing business if
the physical identity with the old unit
is preserved.”
Even though this decision was concerned with the
clause dealing with reconstruction of existing
business but the expression ‘not formed’ was
construed to mean that the undertaking should not
20
be a continuation of the old but emergence of a new
unit. Therefore even if the undertaking is established
by transfer of building, plant or machinery but it is
not formed as a result of such transfer the assessee
could not be denied the benefit.”
16. The principle of law considered in Bajaj Tempo (supra) is
certainly a valid principle of interpretation where there is
ambiguity or absurdity or where conditions of eligibility are
substantially complied. In the present case, the scheme of the
statute is clear that the incentive is applicable to a small scale
industrial undertaking. The intention of legislature is in no manner
defeated by not allowing the said incentive if the assessee ceases
to be the class of industrial undertaking for which the incentive is
provided even if it was eligible in the initial year. Each assessment
year is a separate unit.
17. In Citizen Cooperative Society Limited versus Assistant
Commissioner of Income Tax, Circle-9(1), Hyderabad2
this
Court considered the incentive under Section 80-P meant for a
primary agricultural credit society or a primary cooperative
agricultural and rural development bank. The assessee was held
not to be entitled to the said incentive as business of the assessee
was held to be finance business to which the incentive was not
2 391 ITR 1 = (2017) 9 SCC 364
21
admissible even though the principle of liberal interpretation in
terms of Bajaj Tempo (supra) was applied.
18. In State of Haryana versus Bharti Teletech Ltd.3
,
eligibility of an assessee to get benefit of exemption from tax was
an issue. It was observed that while the exemption notification
should be liberally construed, the beneficiary must fall within the
ambit of the exemption and fulfill the conditions thereof. In case
such conditions are not fulfilled, the issue of application of the
notification does not arise. The principle of interpretation in the
judgment in Bajaj Tempo (supra) and other judgments was dealt
with as follows :
“22. We will be failing in our duty if we do not
address a submission, albeit the last straw, of Mr. Jain
that any provision relating to grant of exemption, be
it under a rule or notification, should be considered
liberally. In this regard, we may profitably refer to the
decision in Hansraj Gordhandas v. CCE and Customs
[AIR 1970 SC 755] wherein it has been held as
follows: (AIR p. 759, para 5)
“5. … It is well established that in a taxing
statute there is no room for any
intendment but regard must be had to the
clear meaning of the words. The entire
matter is governed wholly by the language
of the notification. If the tax-payer is
within the plain terms of the exemption it
cannot be denied its benefit by calling in
aid any supposed intention of the
exempting authority. If such intention can
3 (2014) 3 SCC 556
22
be gathered from the construction of the
words of the notification or by necessary
implication therefrom, the matter is
different.”
23. In CST v. Industrial Coal Enterprises [(1999) 2
SCC 605], after referring to CIT v. Straw Board Mfg.
Co. Ltd. [(1989 (Supp.) 2 SCC 529] and Bajaj Tempo
Ltd. v. CIT, the Court ruled that an exemption
notification, as is well known, should be construed
liberally once it is found that the entrepreneur fulfils
all the eligibility criteria. In reading an exemption
notification, no condition should be read into it when
there is none. If an entrepreneur is entitled to the
benefit thereof, the same should not be denied.
24. In this context, reference to T.N. Electricity Board
v. Status Spg. Mills Ltd.[(2008) 7 SCC 353] would be
fruitful. It has been held therein: (SCC p. 367, para
32)
“32. It may be true that the exemption
notification should receive a strict
construction as has been held by this
Court in Novopan India Ltd. v. CCE and
Customs[ 1994 (Supp) 3 SCC 606], but it
is also true that once it is found that the
industry is entitled to the benefit of
exemption notification, it would received
a broad construction. (See TISCO Ltd. v.
State of Jharkhand[(2005) 4 SCC 272]
and A.P. Steel Re-Rolling Mill Ltd. v. State
of Kerala[(2007) 2 SCC 725].) A
notification granting exemption can be
withdrawn in public interest. What would
be the public interest would, however,
depend upon the facts of each case.”
25. From the aforesaid authorities, it is clear as
crystal that a statutory rule or an exemption
notification which confers benefit on the assessee on
certain conditions should be liberally construed but
the beneficiary should fall within the ambit of the rule
or notification and further if there are conditions and
violation thereof are provided, then the concept of
23
liberal construction would not arise. Exemption being
an exception has to be respected regard being had to
its nature and purpose. There can be cases where
liberal interpretation or understanding would be
permissible, but in the present case, the rule position
being clear, the same does not arise.”
19. Same view was taken in Commissioner of Customs versus
M. Ambalal & Co.4
as follows :
“16. It is settled law that the notification has to be
read as a whole. If any of the conditions laid down in
the notification is not fulfilled, the party is not entitled
to the benefit of that notification. The rule regarding
exemptions is that exemptions should generally be
strictly interpreted but beneficial exemptions having
their purpose as encouragement or promotion of
certain activities should be liberally interpreted. This
composite rule is not stated in any particular
judgment in so many words. In fact, majority of
judgments emphasise that exemptions are to be
strictly interpreted while some of them insist that
exemptions in fiscal statutes are to be liberally
interpreted giving an apparent impression that they
are contradictory to each other. But this is only
apparent. A close scrutiny will reveal that there is no
real contradiction amongst the judgments at all. The
synthesis of the views is quite clearly that the general
rule is strict interpretation while special rule in the
case of beneficial and promotional exemption is
liberal interpretation. The two go very well with each
other because they relate to two different sets of
circumstances.”
20. In State of Jharkhand versus Ambay Cements5
, the
question was whether exemption for newly set up industrial units
was applicable to the assessee therein. The High Court having
4 (2011) 2 SCC 74
5 (2005) 1 SCC 368
24
allowed the benefit even though the assessee did not qualify for
the same, this Court reversed the view of the High Court and held
that the conditions for grant of exemption from tax are mandatory
and in absence thereof exemption could not be granted.
Distinguishing the judgments of this Court in Bajaj Tempo
(supra), it was observed :
“23. Mr Bharuka further submitted that in taxing
statutes, provision of concessional rate of tax should
be liberally construed and in respect of the above
submission, he cited the judgment of this Court in
CST v. Industrial Coal Enterprises [(1992) 3 SCC 78]
and in the case of Bajaj Tempo Ltd. v. CIT. We are
unable to countenance the above submission. In our
view, the provisions of exemption clause should be
strictly construed and if the condition under which the
exemption was granted stood changed on account of
any subsequent event the exemption would not
operate.
24. In our view, an exception or an exempting
provision in a taxing statute should be construed
strictly and it is not open to the court to ignore the
conditions prescribed in the industrial policy and the
exemption notifications.
25. In our view, the failure to comply with the
requirements renders the writ petition filed by the
respondent liable to be dismissed. While mandatory
rule must be strictly observed, substantial compliance
might suffice in the case of a directory rule.
26. Whenever the statute prescribes that a particular
act is to be done in a particular manner and also lays
down that failure to comply with the said requirement
leads to severe consequences, such requirement
would be mandatory. It is the cardinal rule of
interpretation that where a statute provides that a
25
particular thing should be done, it should be done in
the manner prescribed and not in any other way. It is
also settled rule of interpretation that where a statute
is penal in character, it must be strictly construed and
followed. Since the requirement, in the instant case,
of obtaining prior permission is mandatory, therefore,
non-compliance with the same must result in
cancelling the concession made in favour of the
grantee, the respondent herein.”
21. In view of the above judgments, we do not see any difference
in the situation where the assessee, is not initially eligible, or
where the assessee though initially eligible loses the qualification
of eligibililty in subsequent assessment years. In both such
situations, principle of interpretation remains the same.
22. Thus, while there is no conflict with the principle that
interpretation has to be given to advance the object of law, in the
present case, the assessee having not retained the character of
‘small scale industrial undertaking’, is not eligible to the incentive
meant for that category. Permitting incentive in such case will be
against the object of law.
23. For the above reasons, we hold that the assessee is not
entitled to benefit of exemption if it loses its eligibility as a small
scale industrial undertaking in a particular assessment year even if
in initial year eligibility was satisfied.
26
The appeal is accordingly disposed of in the above terms.
Civil Appeal No. 20856 of 2017
(@ Special Leave Petition(Civil) No.8331 of 2016)
Civil Appeal No. 20857 of 2017
(@ Special Leave Petition(Civil) No.3323 of 2016)
Civil Appeal No. 20855 of 2017
(@ Special Leave Petition(Civil) No.148 of 2016)
24. Leave granted. In view of the judgment in the main matter,
these appeals are disposed of in the same terms.
25. The assessing authority may pass an order of compliance by
applying the above principle to the facts of individual cases.
…………………………………..J.
[RANJAN GOGOI]
…………………………………..J.
[ADARSH KUMAR GOEL]
…………………………………..J.
[NAVIN SINHA]
NEW DELHI;
5
TH DECEMBER, 2017.

Posted in Uncategorized

National Register of Indian Citizen = who is originally inhabitant of the State of Assam – apprehensions are wholly unfounded.= The exercise of upgradation of NRC is not intended to be one of identification and determination of who are originally inhabitants of the State of Assam.The sole test for inclusion in the NRC is citizenship under the Constitution of India and under the Citizenship Act including Section 6A thereof. Citizens who are originally inhabitants/residents of the State of Assam and those who are not are at par for inclusion in the NRC.

 

1
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL ORIGINAL/APPELLATE JURISDICTION
WRIT PETITION (CIVIL) NO. 1020 OF 2017
KAMALAKHYA DEY PURKAYASTHA
AND ORS. …PETITIONER(S)
VERSUS
UNION OF INDIA
AND ORS. …RESPONDENT(S)
WITH
WRIT PETITION (CIVIL) NO. 1096 OF 2017
WRIT PETITION (CIVIL) NO. 1095 OF 2017
WRIT PETITION (CIVIL) NO. 1101 OF 2017
WRIT PETITION (CIVIL) NO. 1104 OF 2017
WRIT PETITION (CIVIL) NO. 1147 OF 2017
&
I.A.NO.101687 OF 2017 IN SLP(C)NO.13259 OF 2017
J U D G M E N T
RANJAN GOGOI,J.
1. Heard the learned counsels for the
parties.
2
2. The writ petitions and the
Interlocutory Application(s) under
consideration have been filed seeking
directions from the Court as to the manner
in which the expression “originally
inhabitants of the State of Assam”
appearing in Clause 3(3) of the Schedule
(Special Provisions as to manner of
Preparation of National Register of Indian
Citizen in State of Assam) to the
Citizenship (Registration of Citizens and
Issues of National Identity Cards) Rules,
2003, is to be understood and furthermore
for directions laying down the procedure by
which such persons are required to be
identified.
3. Relevant clauses of the Schedule
including Clause 3(3) reads as follows:
“2. Manner of preparation of draft
National Register of Indian Citizen in
State of Assam—
3
(1)(a) ……
(b) ……….
(c) …………
(2) The Local Registrar of
Citizen Registration shall receive
the filled up application forms,
at the same place where the
applications are issued, and issue
the receipt thereof to the
applicant.
(3) The Local Registrar of
Citizen Registration, after the
receipt of the application under
sub-paragraph (2) shall scrutinize
the applications and after its
verification, prepare a
consolidated list thereof which
shall contain the names of the
following persons, namely—
(a) person whose name
appear in any of the
electoral rolls upto the
midnight of the 24th day of
March, 1971 or in National
Register of Citizens, 1951;
(b) descendants of the
persons mentioned in clause
(a) above;
4
3. Scrutiny of applications—
(1) The scrutiny of
applications received under
sub-paragraph (3) of paragraph 2
shall be made by comparing the
information stated in the
application form with the official
records and the persons, of whom
the information is found in order,
shall be eligible for inclusion of
their names in the consolidated
list.
(2) The names of persons who
have been declared as illegal
migrants or foreigners by the
competent authority shall not be
included in the consolidated list:
Provided that the names of persons
who came in the State of Assam
after 1966 and before the 25th
March, 1971 and registered
themselves with the Foreigner
Registration Regional Officer and
who have not been declared as
illegal migrants or foreigners by
the competent authority shall be
eligible to be included in the
consolidated list.
(3) The names of persons who
are originally inhabitants of the State
of Assam and their children and
descendants, who are Citizens of
India, shall be included in the
consolidated list if the
citizenship of such persons is
ascertained beyond reasonable
doubt and to the satisfaction of
the registering authority;
(underlining is ours)
5
(4) The Local Registrar of
Citizens Registration may, in case
of any doubt in respect of
parental linkage or any particular
mentioned in the application
received under sub-paragraph (3)
of paragraph 2, refer the matter
to the District Magistrate for
investigation and his decision and
Local Registrar of Citizens
Registration shall also inform the
same to the individual or the
family.”
4. Clause 3(3) provides for
identification of persons entitled to be
included in the National Register of
Citizens (NRC) by a process different from
what is enumerated in Clause 3(2) and,
therefore, the said Clause i.e. 3(3)
constitutes an exception thereto. Clause
3(3) contemplates a less strict and
vigorous process for deciding claims for
inclusion in the NRC insofar as persons who
are originally inhabitants of the State of
Assam are concerned. Identification of
persons who are originally inhabitants of
6
the State of Assam as against those who are
not does not determine any entitlement for
inclusion in the NRC which is on the basis
of proof of citizenship alone and nothing
else. Neither does such identification
confer any special entitlement or benefit.
This has, infact, been clarified in several
of the reports submitted by the learned
Coordinator before this Court.
5. The prayer made in the writ
petitions and the I.As, as admitted in the
course of the hearing by the learned
counsels for the writ
petitioners/applicants, is founded on an
apprehension that by the process of
verification of the claims for inclusion in
the NRC based on the claim to be originally
inhabitants of the State of Assam a
superior class of citizens is being
created. The question who is originally
inhabitant of the State of Assam, according
7
to the applicants and the writ petitioners,
may also have impact on the entitlement of
such persons in the matter of opportunities
for education, employment etc. vis-a-vis
the second category of citizens i.e. who
are not originally inhabitants of Assam.
6. All such apprehensions are wholly
unfounded. The exercise of upgradation of
NRC is not intended to be one of
identification and determination of who are
originally inhabitants of the State of
Assam. The sole test for inclusion in the
NRC is citizenship under the Constitution
of India and under the Citizenship Act
including Section 6A thereof. Citizens who
are originally inhabitants/residents of the
State of Assam and those who are not are at
par for inclusion in the NRC.
7. In view of the above, we do not
find any reason to issue any direction or
8
clarification as to the meaning of the term
“originally inhabitants of the State of
Assam” as sought for in the present Writ
Petitions and the Interlocutory
Application(s) which are accordingly
disposed of in terms of our directions and
observations as above.
.………………….,J.
(RANJAN GOGOI)
…………………,J.
(ROHINTON FALI NARIMAN)
NEW DELHI
DECEMBER 5, 2017

Posted in Uncategorized

Monopolies and Restrictive Trade Practices = unfair trade practice – (i) The Board will allot one flat to the appellant in Jodhpur in Board’s Middle Income Group “B” Housing Scheme. (ii) The appellant will pay the price of the flat selected by him as per the approved Government’s price prevalent and in force as on the date of this judgment. (iii) The Board will adjust a sum of Rs.19,600/- + interest @12% per annum to be calculated on Rs. 19,600/- from the date of its payment by the appellant to the Board till the date of execution of sale deed by the Board in appellant’s favour from the total price and after giving adjustment of the said amount, i.e.,(principal amount Rs.19,600/- and interest) the balance would be considered as final price payable by the appellant to the Board for purchase of flat. (iv) In other words, the appellant will pay a total price of the flat to the Board after deducting Rs.19,600/- + interest to be calculated @ 12 % p.a. on Rs.19,600/- 7 from the date the said payment was made by the appellant to the Board till the date of execution of sale deed of the flat. (v) The Board will accordingly work out the price of the flat, as directed above, and inform the appellant. (vi) If the appellant deposits the entire sale consideration, as directed above, within the time fixed by the Board in the notice sent to the appellant, the Board will execute the sale deed in favour of the appellant and also in favour of appellant’s first blood relation jointly along with the appellant, in case, the appellant expresses his wish to allow any of his blood relation to join with him as co-owner in execution of the sale deed. It is because it was stated at the bar that the appellant is now quite aged. This liberty is, therefore, granted to the appellant. (vii) If the appellant fails to pay the price within the time fixed by the Board then a sum of Rs.19,600/- deposited by the 8 appellant with the Board shall stand forfeited. (viii) Let all the formalities, as directed above, be completed within 6 months from the date of receipt of this judgment by the parties under intimation to both as an outer limit to give quietus to this litigation with no claim of any kind surviving against both the parties for future. 13) In view of foregoing directions, we do not consider it necessary to examine the legal issues arising in the case.

1
NON-REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL No. 2832 OF 2007

Daulat Singh Rathore …Appellant(s)

VERSUS
Rajasthan Housing Board ….Respondent(s)
J U D G M E N T
Abhay Manohar Sapre, J.
1) This appeal is filed against the final judgment
and order dated 20.02.2006 passed by the
Monopolies and Restrictive Trade Practices
Commission, New Delhi (hereinafter referred to as
“MRTP Commission”) in UTPE No. 207 of 1998
whereby the MRTP Commission disposed of the
complaint and discharged the notice of enquiry
2
holding that the allegation of unfair trade practice
against the respondent are not proved.
2) The facts of the case lie in a narrow compass.
They, however, need mention infra to appreciate the
short issue involved in the appeal.
3) The Respondent herein is a State Housing
Board (hereinafter referred to as “the Board”). The
Board is constituted for the State of Rajasthan
under the Rajasthan Housing Board Act, 1970
(hereinafter referred to as “the Act”).
4) Pursuant to the Schemes introduced by the
Board for sale of different types of Houses/flats in
the city of Jodhpur, the Board invited applications
from public at large in the year 1982 for sale of
different categories of the houses/flats.
5) The appellant made an application on
27.12.1982 (Annexure-P-1) to the Board for
allotment of one flat to him at Jodhpur under a
Scheme called, Middle Income Group “B” category.
3
On 30.05.1983, the appellant deposited a sum of
Rs.4,600/- as registration amount and then
deposited a sum of Rs.15,000/- on 18.09.1993
being first instalment.
6) Thereafter, there arose disputes between the
appellant and the Board for sale of the flat which, in
the first instance, led to filing of the petition being
Writ Petition No.4707/1993 by the appellant in the
High Court of Rajasthan at Jodhpur. By order
dated 04.05.1995, the High Court dismissed the
writ petition as having rendered infructuous.
7) The appellant then took recourse to two
remedies for ventilating his grievance against the
Board. He filed a suit being Civil Suit No. 23/2001
in the Court of ADJ(I) at Jodhpur on 02.07.2001
challenging therein the actions of the Board and
simultaneously filed a complaint being UTPE No.
207/1998 before the MRTP Commission, New
Delhi against the Board.
4
8) So far as the suit is concerned, it is still
pending and so far as the complaint is concerned, it
was dismissed by the MRTP Commission by
impugned order dated 20.02.2006 giving rise to
filing of this appeal by way of special leave by the
appellant in this Court. This Court granted leave
on 17.05.2007.
9) On 11.08.2016, this Court recorded in the
proceeding that the appellant has given a proposal
to the Board for reconsideration of his case for
allotment of the flat. This Court observed that the
Board should look into the appellant’s proposal with
objectivity and call the appellant personally to
resolve the dispute out of the Court. On 19.10.2016,
learned counsel for the respondent made a
statement that the Board has decided to allot one
flat to the appellant and the details of the same
would be placed on record within 2 weeks. On
23.03.2017, this Court wanted to find out the prices
5
of the flats between 2005 to 2010. The Board has
accordingly placed on record the details of the
prices of the flats.
10) It is in the light of these background facts, the
question arises as to what order needs to be passed
for the disposal of the appeal.
11) Having heard the learned counsel for the
parties and on perusing the record of the case and
further keeping in view the nature of the
controversy, stand taken by the both parties and
lastly, the interim orders passed by this Court on
various dates mentioned above, we are of the
considered opinion that this appeal can be disposed
of finally by passing the following directions.
12) In our opinion, the directions given
hereinbelow would balance the equities between the
parties and also safeguard their interest in relation
to the subject matter of the appeal. The following
are the directions:
6
(i) The Board will allot one flat to the
appellant in Jodhpur in Board’s Middle
Income Group “B” Housing Scheme.
(ii) The appellant will pay the price of
the flat selected by him as per the
approved Government’s price prevalent
and in force as on the date of this
judgment.
(iii) The Board will adjust a sum of
Rs.19,600/- + interest @12% per annum
to be calculated on Rs. 19,600/- from
the date of its payment by the appellant
to the Board till the date of execution of
sale deed by the Board in appellant’s
favour from the total price and after
giving adjustment of the said amount,
i.e.,(principal amount Rs.19,600/- and
interest) the balance would be considered
as final price payable by the appellant to
the Board for purchase of flat.
(iv) In other words, the appellant will
pay a total price of the flat to the Board
after deducting Rs.19,600/- + interest to
be calculated @ 12 % p.a. on Rs.19,600/-
7
from the date the said payment was made
by the appellant to the Board till the date
of execution of sale deed of the flat.
(v) The Board will accordingly work out
the price of the flat, as directed above,
and inform the appellant.
(vi) If the appellant deposits the entire
sale consideration, as directed above,
within the time fixed by the Board in the
notice sent to the appellant, the Board
will execute the sale deed in favour of the
appellant and also in favour of appellant’s
first blood relation jointly along with the
appellant, in case, the appellant
expresses his wish to allow any of his
blood relation to join with him as
co-owner in execution of the sale deed. It
is because it was stated at the bar that
the appellant is now quite aged. This
liberty is, therefore, granted to the
appellant.
(vii) If the appellant fails to pay the price
within the time fixed by the Board then a
sum of Rs.19,600/- deposited by the
8
appellant with the Board shall stand
forfeited.
(viii) Let all the formalities, as directed
above, be completed within 6 months
from the date of receipt of this judgment
by the parties under intimation to both as
an outer limit to give quietus to this
litigation with no claim of any kind
surviving against both the parties for
future.
13) In view of foregoing directions, we do not
consider it necessary to examine the legal issues
arising in the case.
14) The appeal stands disposed of finally.

……………………………………….J.
[ABHAY MANOHAR SAPRE]
……………………………………..J.
[NAVIN SINHA]
New Delhi;
December 04, 2017

Posted in Uncategorized