2015 SCC Vol. 10 December 21, 2015 Part 4

Civil Procedure Code, 1908 — Or. 37 R. 3 — Summary suit — Leave to Defend: Where the defendant has raised a triable issue or a reasonable defence, the defendant is entitled to unconditional leave to defend. Leave is granted to defend even in cases where the defendant upon disclosing a fact, though lacks the defence but makes a positive impression that at the trial the defence would be established to the plaintiff’s claim. Furthermore, leave to defend the summons for judgment shall always be granted to the defendant when there is a triable issue as to the meaning or correctness of the documents on which the claim is based or the alleged facts are of such nature which entitle the defendant to interrogate or cross-examine the plaintiff or his witnesses. [State Bank of Hyderabad v. Rabo Bank, (2015) 10 SCC 521]

Civil Procedure Code, 1908 — Or. 39 R. 2-A and S. 122 — Interim injunction order passed by High Court under Or. 39 Rr. 1 and 2 CPC — Breach of: S. 22 of Contempt of Courts Act, 1971 provides that right to proceed under said Act is an additional right.  Besides, power of High Court in respect of contempt stems not only from Contempt of Courts Act, 1971 but also from Art. 215 of Constitution of India. Said power under Art. 215 cannot be abridged or abrogated or cut down or controlled or limited by any statute or rules or provision of CPC. Further, in view of S. 122 CPC, in case of any conflict between provisions of CPC and Rules framed by High Court, the latter will prevail. In present case, relevant High Court Rules prescribing specific procedure for dealing with cases under Contempt of Courts Act. Provisions of Or. 39 R. 2-A CPC cannot override said Rules. Hence, dismissal of contempt petition by High Court on ground that in view of specific remedy being available under Or. 39 R. 2-A CPC to meet the contingency of breach of injunction orders, person complaining of breach of injunction order should not be allowed to take up proceedings under Contempt of Courts Act, was not proper. [Welset Eegineers v. Vikas Auto Industries, (2015) 10 SCC 609]

Constitution of India — Art. 136 — Prejudice to other/main proceedings — Interference by Supreme Court in collateral proceedings (contempt proceedings) pending adjudication upon main issue: When the issue on merits was seized of by the original court in civil suit and rights of the parties were still not decided, it would not be proper for Supreme Court to probe into facts and record any finding on any of the issues arising out of collateral proceedings i.e. contempt proceedings initiated by High Court without first disposing of interim application. Any observation by Supreme Court in such proceedings might cause prejudice to parties while prosecuting their case before original court. [Quantum Securities (P) Ltd. v. New Delhi Television Ltd., (2015) 10 SCC 602]

Constitution of India — Art. 226: As in this case suspension order passed against respondent Controller of Examinations of University alleged to have indulged in financial irregularities causing huge financial loss to University, was set aside by Single Judge of High Court but Division Bench of High Court by impugned judgment without formulating any issue for determination or examining rival submissions disposing of writ appeal by issuing directions to appellant University, though observing that “matter had become academic, if not infructuous” and yet making the order subject to any decision rendered by Single Judge, who according to Division Bench had heard and reserved matter for pronouncement of final orders, hence, matter remitted for afresh decision. [North Bengal University v. Dilip Kumar Sarkar, (2015) 10 SCC 545]

Constitution of India — Arts. 19(1)(g), 19(6) and 39(a) — Right to carry on trade and occupation from a kiosk opposite/in proximity to court premises: Security of court/premises, held, good ground to remove such vendors/kiosks from vicinity of court premises. [Dharam Chand v. New Delhi Municipal Council, (2015) 10 SCC 612]

Criminal Procedure Code, 1973 — Ss. 220 and 223 — Enabling in nature — Joint trial: Discretion is vested with court to order joint trial. When (a) joint trial would prolong trial; (b) cause unnecessary wastage of judicial time; (c) confuse or cause prejudice to accused, who had taken part only in some minor offence, (d) neither facts and allegations are common, nor is evidence common nor were accused acting with a commonality of purpose, holding of joint trial, not obligatory. [Essar Teleholdings Ltd. v. CBI, (2015) 10 SCC 562]

Customs — Classification of goods — Duplicating machine and printing machine: From the description of the process adopted in Risograph machine, it becomes apparent that Risograph printing process is more akin to screen printing. Hence, Risograph falls under Heading 84.43 (8443.50) and thereby exigible to duty @ 25% ad valorem, and not a “duplicating office machine” falling under Heading 84.72 (8472.90) and thereby exigible to duty @ 65%. [HCL Ltd. v. Commr. of Customs, (2015) 10 SCC 532]

Customs — Concession/Exemption/Incentive/Rebate — Exemption: Amendment of licence granted to assessee for import of goods under exemption notification, by DGFT does not take away requirement of fulfilment of conditions under the exemption notification. Since conditions of the exemption notification are not fulfilled and law requires strict compliance exemption notification, assessee becomes liable to pay import duty. [Commr. of Customs v. Pennar Industries Ltd., (2015) 10 SCC 581]

Customs — Kar Vivad Samadhan Scheme, 1998 — Demand notice: Endorsement on the bill of entry asking the assessee to pay additional customs duty, amounted to a notice of demand within S. 95(ii)(b) of 1998 Act, thereby entitling the assessee to avail benefit of Kar Vivad Samadhan Scheme. [Swastika Enterprises v. Commr. of Customs, (2015) 10 SCC 573]

Excise — Appeal — Appeal to Tribunal — Pre-deposit: Restoration of appeal which had been dismissed for non-deposit of, after such dismissal had attained finality. However, clarified that all contentions of both parties are left open and present order not to be treated as precedent in any other case. [Kisaan Gramodyog Sansthan v. CCE, (2015) 10 SCC 629]

Excise — Classification of goods — Dental cleaner or toothpaste: As the ingredients and ratio of all the inputs which go into the manufacturing of a toothpaste and dental cleaner found different and varying and the dental cleaner, found to have in addition, two more ingredients, namely, silicon agglomerate and bluer agglomerates. Also, the manufacturing process of Closeup toothpaste and Close-up Whitening, products of the same company, found to be different; stages of manufacture and time taken to manufacture also found to be different and expert witness, explaining the differences in the products, opined that Close-up Whitening dental cleaner cannot be equated with toothpaste, hence, in light of these factors, Closeup Whitening held not to be a toothpaste but a dental cleaner, to be classified under Sub-Heading 3306.90. [CCE v. Global Health Care Products Partnership Firm, (2015) 10 SCC 513]

Income Tax — Concession/Exemption/Incentive/Rebate: Exemption notification No. GSR 307(E) dt. 31-3-1983 granting exemption in respect of surtax in favour of foreign companies with whom Central Government had executed agreements for direct association or participation by Central Government or persons authorised by it (such as ONGC) in prospecting or extraction or production of mineral oils, confines or restricts scope of exemption to only one category of foreign companies which has been specifically enumerated in S. 24-AA(2)(a) of 1964 Act. Second category of foreign companies that may be providing services as enumerated in S. 24-AA(2)(b) of 1964 Act is specifically omitted in the exemption notification. Omission of this particular category of foreign companies in exemption notification, notwithstanding wide amplitude and availability of power under S. 24-AA of 1964 Act, clearly reflects a conscious decision on part of Central Government to confine scope of exemption notification to only those foreign companies that are enumerated in and covered by S. 24-AA(2)(a) of 1964 Act. If out of the two limbs where the power of exemption was intended to operate, the repository of the power i.e. the Central Government, had consciously chosen to grant exemption in one particular field i.e. foreign companies covered by S. 24-AA(2)(a) of 1964 Act, the scope of the grant cannot be enhanced or expanded by a judicial pronouncement. [ONGC v. CIT, (2015) 10 SCC 621]

Income Tax — Tax Deducted at Source (TDS) — Rate applicable — S. 194-I or S. 194-C of IT Act — Applicability: Landing, parking and take-off facilities provided under an agreement and/or arrangement with Airports Authority of India, such facilities are not “use of land” for which “rent” is to be paid. As the facility was not of “use of land” per se but charges on landing and take-off and other air traffic services by AAI from airlines were in respect of number of facilities provided by AAI which was to be necessarily provided in compliance with various international protocols. Charges were for various services provided and not for land usage or area allotted simpliciter. In view of compulsorily providing these facilities, “use of land” pails into insignificance and becomes incidental. Such charges are not dependent upon use of the land, hence, such charges cannot be treated as “rent” within the meaning of S. 194-I of 1961 Act. Hence, TDS @ 2% as provided in S. 194-C would be deducted on such charges. [Japan Airlines Co. Ltd. v. CIT, (2015) 10 SCC 591]

Kerala Building Tax Act, 1975 (7 of 1975) — Ss. 5-A, 2(e), 2(k) proviso and Expln. 2 to S. 2(e): Imposition of luxury tax on entire building by clubbing plinth area of all residential apartments owned by different persons and computing tax treating the same as singular building, not proper. In terms of Expln. 2 to S. 2(e) when a building consists of different apartments/flats owned by different persons and cost of building is met by all of them, each apartment/flat is deemed to be separate building. Further held, Expln. 2 to S. 2(e) should not be read as negative provision, detrimental and fatal to cases where there are separate owners since it is a benevolent and beneficial provision. Hence, matter remanded to Revenue Authority to recompute luxury tax accordingly. [State of Kerala v. A.P. Mammikutty, (2015) 10 SCC 632]

Motor Vehicles Act, 1988 — Ss. 166 and 168 — Compensation — Permanent partial disability: Compensation enhanced to Rs 15,97,400, in this case where a professional driver has suffered 100% permanent disability with regard to his earning capacity in the accident. [Rajan v. Soly Sebastian, (2015) 10 SCC 506]

Penal Code, 1860 — S. 307 or S. 325 r/w S. 320 Seventhly — Injury in question if “grievous hurt”: To make out the offence of voluntarily causing grievous hurt, there must be a specific hurt voluntarily inflicted and coming within the eight kinds of hurt enumerated in Section 320 IPC. As PW 2 sustained fracture or dislocation of frontal bone of skull caused by appellant during sudden fight which clearly falls in the category of “grievous hurt” as expressly mentioned in clause Seventhly of S. 320. Even though doctor was not questioned about nature of injuries, fracture of the frontal bone would bring the offence within the definition of “grievous hurt”. Hence, High Court rightly convicted the appellant under S. 325 instead of under S. 307. However, as the occurrence was a sudden fight and in a fit of passion, appellant inflicted injuries on PW 2, sentence of imprisonment of 7 yrs is excessive and is reduced to 3 yrs. [Sakharam v. State of M.P., (2015) 10 SCC 557]

Succession Act, 1925 — Ss. 61 to 63, 70, 73 and 372 — Multiple wills: In this case where succession certificate was granted to R-1, adopted son of testator on basis of will dt. 15-11-1978 which superseded two wills, as there were no vitiating or suspicious circumstances invalidating bequest and execution of lattermost will and the attestation thereof by two witnesses, as required in law was satisfactorily proved, and signature of the testator, on these documents has been endorsed by both the handwriting experts. Also, the report of the forensic science laboratory also corroborates this finding, hence, it was rightly found by High Court that dispensation made by testator in favour of R-1 could not be repudiated to be in defiance of logic or unfair vis-à-vis other members of family. [Shakuntala Bai v. Mahaveer Prasad, (2015) 10 SCC 550]