SCC Issue dated April 7th, 2021 (Vol. 3 Part 3)
In this part read a very important decision delivered by the Supreme Court running into over 90 pages which have been expertly analysed by our editors. Supreme Court has discussed the mode of dealing with withheld securities of a defaulting member by National Stock Exchange of India/National Securities Clearing Corporation Limited, consequent to his expulsion.[Rusoday Securities Ltd. v. National Stock Exchange of India Ltd., (2021) 3 SCC 401]
Short Notes: 4
Advocates before the Court:
For appellants: Senior Advocate Siddhartha Mitra and Advocates-on-record Ashok Mathur and Devashish Bharuka
For Respondent(s): Senior Advocate Shyam Divan and Adocates-on-Record. S. S. Shroff, Rabin Majumder, Bhargava V. Desai
Civil Procedure Code, 1908 — Or. 14 R. 2 — Framing of preliminary issue — Issues in regard to maintainability of suit: Framed issues relating to maintainability of suit, held, if taken up and decided by trial court as preliminary questions of law would cause no prejudice to appellant-plaintiff. [Santosh Kumar v. Ashok Chand, (2021) 3 SCC 385]
Constitution of India — Art. 21: Right to marry person of one’s choice is integral to Art. 21. Autonomy of an individual inter alia in relation to family and marriage is integral to the dignity of the individual. Training programme to be devised, and guidelines to be issued by police authorities in this regard. [Laxmibai Chandaragi B. v. State of Karnataka, (2021) 3 SCC 360]
Education Law — Professional Colleges/Education — Medical and Dental Colleges — Establishment, Running, Closure and Nationalisation of Medical/Dental Colleges — Affiliation/Recognition — Purpose of/Entitlement to/Prerequisites for/Competent Authority/Time-Schedule: In this case, denial of permission to College to admit students for particular academic years, held, fully justified, as College concerned had not utilised opportunities given to it to rectify deficiencies, and on the relevant date, as per time-schedule fixed in respect of permissions to be granted for the next academic year, application for renewal of permission had not been filed in time. [Chintpurni Medical College & Hospital v. Union of India, (2021) 3 SCC 374]
Family and Personal Laws — Judicial Intervention/Family Courts/Judges/Officers — Alternative Dispute Resolution/Mediation/Conciliation/Compromise — Mediation — Matrimonial dispute: In this case, there was reference to mediation on consent of counsel. Directions were issued as to expenses and interaction of child with parent and family of parent whose custody it was not in. [Roopsi Varun Gupta v. Varun Vikram Gupta, (2021) 3 SCC 373]
Insolvency and Bankruptcy Code, 2016 — Ss. 5(7) and 5(8), 43, 45(2), 49, 50 and Ss. 7 to 9 — Financial creditor — Who is: Collusive/Sham transactions cannot amount to “financial debts” under IBC. Under S. 5(7) a person can be categorised as a financial creditor if a financial debt is owed to it. S. 5(8) stipulates that the essential ingredient of a financial debt is disbursal against consideration for the time value of money. A transaction which is sham or collusive would only create an illusion that money has been disbursed to a borrower with the object of receiving consideration in the form of time value of money, when in fact the parties have entered into the transaction with a different or an ulterior motive i.e. the real agreement between the parties is something other than advancing a financial debt. Further, IBC recognises that for the success of an insolvency regime, the real nature of the transactions has to be unearthed in order to prevent any person from taking undue benefit of its provisions to the detriment of the rights of legitimate creditors. [Phoenix ARC (P) Ltd. v. Spade Financial Services Ltd., (2021) 3 SCC 475]
Land Acquisition Act, 1894 — Ss. 11, 4, 6 and 18 — Acquisition of land: In this case of dispute over approval of award and reopening of acquisition proceedings, approval of award supported by material on the record, compensation paid thereunder and possession of the land handed over to the Government. Resultantly, reopening of acquisition proceedings by way of re-notification of the already acquired land under S. 4 of the LA Act by the Government, reiterated, is not permissible. Furthermore, as award had been approved before coming into force of the 2013 Act, S. 24(1)(a) of the 2013 Act would not be applicable. [Assam Industrial Development Corpn. Ltd. v. Gillapukri Tea Co. Ltd., (2021) 3 SCC 388]
Penal Code, 1860 — S. 302 and S. 53 Secondly: Imposition of sentence of life imprisonment by trial court with direction that it shall be for remainder of natural life, held, not permissible. Such power of imposing a fixed term of imprisonment, or for the remainder of natural term of life of convict, while imposing a sentence of life imprisonment, held, is available only to High Court and Supreme Court, and not the trial court. [Gauri Shankar v. State of Punjab, (2021) 3 SCC 380]
Penal Code, 1860 — S. 302 or S. 304 — Murder or culpable homicide — Death due to septicaemia: There is no absolute proposition of law that in all cases where deceased died due to septicaemia, case would fall under S. 304. The same has to be determined in the facts and circumstances of each case. [Khokan v. State of Chhattisgarh, (2021) 3 SCC 365]
SEBI (Stockbrokers and Sub-Brokers) Regulations, 1992 — Circular dt. 19-5-1997 issued by NSCCL and adopted by Exchange, prescribing trading/exposure limits coupled with sanctions for non-compliance i.e. operational parameters — Vires of: In this case, Circular in question pertained to trading/exposure limits coupled with sanctions in case of non-compliance and the Exchange adopted the circular from the Clearing Corporation and notified it in the form of operational parameter. The Supreme Court held that the legislature has bestowed upon the Exchange sufficient freedom of action to effectively control and regulate the functioning of stockbrokers who use the Exchange as a means to enter into financial relationships with the investors and common public. Further, this freedom of action is guaranteed in the preapproved Bye-laws which enable the Exchange to frame Regulations, instructions, operational parameters, notice, etc. and bring them into force without subjecting them to any added condition of prior approval of the Central Government/SEBI. The only limitation on this power of the Exchange is that such Regulations or operational parameters issued under the Bye-laws are subject to the 1956 Act, the 1992 Act and the Rules framed thereunder. Further, rejecting the challenge to the legal sanctity of the circular, held, since the Bye-laws and Rules of the Exchange are duly approved by the Central Government/SEBI, it can safely be stated that actions taken by the Exchange under the Bye-laws or Regulations. By prescribing such operational parameters in the form of a circular and in consequence thereof would assume enforceable character. [Rusoday Securities Ltd. v. National Stock Exchange of India Ltd., (2021) 3 SCC 401]
Transfer of Property Act, 1882 — Ss. 122 and 123 — Gift of immovable property when becomes complete — Acceptance of gift: Acceptance by or on behalf of donee must be made during lifetime of donor and while he is still capable of giving. Execution of gift deed registered and attested in accordance with S. 123 TPA, and acceptance of such gift make gift of immovable property complete. Thereafter, donor is divested of the title or interest being gifted, and donee becomes owner of the gifted property, estate or interest. [Daulat Singh v. State of Rajasthan, (2021) 3 SCC 459]