ALTERNATE DISPUTE RESOLUTION

"I'm glad we settled ..."

 

In the recent years, Alternative Dispute Resolution (ADR) has received widespread popularity both in the general public as well as in the legal profession. As the name itself suggests, it is the alternate solution for dispute resolution. Whenever a dispute arises people generally rush to the court for settlement. But due to the rising cost of litigation, lengthy   procedures and undue delay it has become impractical to resort to traditional lawsuits. Civil Courts face backlogged dockets, resulting in delays of years. As a result, some Courts now encourage parties to resort to ADR before permitting the parties’ cases to be tried.

There are various methods used for ADR but Arbitration, Mediation & Conciliation are the widely used methods.

ARBITRATION:

It is a procedure where a dispute is submitted, by agreement of the parties, to one or more arbitrators who make a binding decision on the dispute. This process can start only when there is a valid Arbitration Agreement between the parties prior to the emergence of the dispute. The Agreement must be in writing.

CONCILIATION:

It is another form of ADR where a conciliator appointed by the parties to a dispute, meets them separately and also together in an attempt to resolve their differences. This process is different from arbitration in a way that it has no legal standing and the conciliator usually has no authority to seek evidence or call witnesses. The conciliator usually writes no decision and no award is given by him.

In conciliation, the resolution of the dispute by the parties themselves is the essential point.

MEDIATION:

It is another effective way of resolving dispute without going to the Court. It involves a mediator which is an independent third party and helps both parties to come to an agreement. Mediation is also not binding on the parties. The mediator’s role is not to reach a decision, but it is to help the parties reach their own decision.

ADR has several advantages over litigation:

  • It is usually faster and less costly.
  • It is more flexible.
  • It is more informal.
  • ADR is more likely to preserve goodwill which is necessary especially in situations where there is a continuing relationship.

 

ADR involves methods which act as an alternative to litigation. But these methods do not replace litigation but it is an addition to litigation. Even the strongest supporters of ADR agree that matters should be resolved through Courts but there are other methods also which can be referred to before litigation which offers many advantages over the adversarial route.

 

Sanchayeeta Das

Associate

The Indian Lawyer

 

 

 

 

CHEQUE BOUNCING

Cheque-Bounce-Cases

 

STEPS TO BE CONSIDERED IN CASE OF CHEQUE BOUNCING

Cheque is a negotiable instrument drawn upon a specified banker expressed to be payable on demand. A cheque involves three parties, first, the drawer who is author of the cheque, second, the payee in whose favour, the cheque is drawn and third, the drawee or payer bank who is directed to pay the amount.

Cases of cheque bouncing are common these days. Sometimes cheques bearing large amounts remain unpaid and are returned by the bank on which they are drawn.

Cheque bouncing is a Criminal Offence, which is governed by the Negotiable Instrument Act, 1881 and punishable under the same up to two years or with monetary penalty or with both.

These conditions must be fulfilled before going to court to file a suit against the drawer in cheque bouncing cases according to section 138 of the Negotiable Instrument Act, 1881:

  • The cheque should have been drawn by the drawer on an account maintained by him.
  • The cheque is issued towards discharge of a debt or legal liability.
  • The cheque has to be presented to the bank within the six month from the date in which it is drawn or within the period of its validity.
  • When a Cheque is dishonoured, a notice has to be given in writing to the drawer of the cheque within the thirty days from the receipt of the information from the bank regarding the return of the cheque as unpaid.
  • That Notice should be sent by Registered post with acknowledgement receipt.
  • The drawer has to make the payment of the said amount of money to the payee within the fifteen days of the receipt of the said notice.
  • The complaint should be registered in a magistrate’s court within a month of the expiry of the notice period if no payment has been received within the fifteen days of the receipt of the said notice.

 

The following documents will be required in filing the suit:

  • Complaint,
  • Oath letter/Affidavit; and
  • Photocopy of all the documents such as cheque, memo, notice copy, and acknowledgement receipts.

 

If the payee fails to file the complaint within thirty days, the complaint becomes barred by limitation of time.  The jurisdictional magistrate court

may refuse to entertain such a belated complaint.  However, if the payee has sufficient reasons to justify delay in filing the complaint, he may make an application before the magistrate along with the complaint, to explain the reasons for delay and seek condoning of delay.  Cognizance of the complaint may be taken if the Court is satisfied that the payee had sufficient cause for not making the complaint within the prescribed period.

Cause of action arose on the date of receiving “Cheque Return Memo” from the bank. When a cheque is dishonoured the drawee bank immediately issues a ‘Cheque Return Memo’ to the banker of the payee mentioning the reason for non-payment. The payee’s banker then gives the dishonoured cheque and the memo to the payee.

If a notice is not given within 1 month after the cheque has bounced, then the check needs to be presented in the bank again and a notice can then be issued after the check bounces subject to the condition that it has to be submitted in the bank within its validity period (A cheque expires after six months).

Dishonour of a cheque due to stop payment is also covered under Section 138 of the NI Act.

Presentation of the cheque at the request of the drawer after the demand notice has been sent will and consequent dishonour of the cheque will not mean that the drawer’s time limit under the notice has increased.

A cheque issued as a gift/donation/any other obligation, will not be covered under Section 138 of the Act.

 

Parul

Senior Associate

The Indian Lawyer

 

COPYRIGHT

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Under the Copyright Act, Copyright means an exclusive right in case of the following acts:

in the case of a literary, dramatic or musical work, to do and authorise the doing of any of the following acts,   namely:-

  • to reproduce the work in any material form;
  • to publish the work;
  • to perform the work in public;
  • to produce, reproduce, perform or publish any translation of the work;
  • to communicate the work by radio-diffusion or to communicate to the public by a loud-speaker or any other similar instrument the radio-diffusion of the work;
  • to make any adaptation of the work;

 

in the case of an artistic work, to do or authorise the doing of any of the following acts, namely:-

  • to reproduce the work in any material form;
  • to publish the work;
  • to include the work in any cinematograph film;
  • to make any adaptation of the work;

 

in the case of a cinematograph film, to do or authorise the doing of any of the following acts, namely:-

  • to make a copy of the film;
  • to cause the film, in so far as it consists of visual images, to be seen in public and, in so far as it consists of sounds, to be heard in public;
  • to make any record embodying the recording in any part of the sound track associated with the film by utilising such sound track;
  • to communicate the film by radio-diffusion;

 

in the case of a record, to do or authorise the doing of any of the following acts by utilising the record, namely:-

  •  to make any other record embodying the same recording;
  •  to cause the recording embodied in the record to be heard in public;
  •  to communicate the recording embodied in the record by radio-diffusion.

 

A copyright exist only where the work is an original work. Hence, in order to claim copyright the creator must show that the work is an original creation.

In order to protect one’s copyright, it is imperative that such a work is registered with the Registrar of Copyright in order to assist the owner of the Copyright to prove his claim to the said work. The Register of Copyrights which is in the Copyright office is deemed to be prima facie evidence of the particulars entered therein and is admissible as evidence in all courts without further prove or production of the original.

When a copyright of the creator is infringed by a third party registration or pending application for registration will assist the owner in suing the third party for infringement.

In conclusion, we advice that a creator of any work should understand the importance of registering his/her copyright in order to enable the said owner to enjoy the fruits of his creation.

 

Sanchayeeta Das

Associate

The Indian Lawyer

FOOD ADULTERATION

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The Bread Scare – Should We Expose Ourselves to Cancer

In a recent report by the Centre for Science and Environment (CSE) released on Monday (23 May 2016) an alarming fact has come to the notice of the Public. The CSE says that nearly 84% of 38 commonly available brands of pre-packaged bread, including pav and buns, tested positive for potassium bromate and potassium iodate, which is banned in many countries as they are listed as “hazardous” for public health. Potassium bromate and potassium iodate are carcinogenic i.e. it can cause cancer.

The Central Government is set to ban use of potassium bromate as food additive in the next 15 days, following the CSE study that claimed presence of cancer-causing chemicals in bread. The move comes after the Food Safety and Standards Authority of India (FSSAI) recommended a ban on use of potassium bromate in the bread industry. “Potassium bromate is one of 11,000 food additives that are allowed in food business. After careful consideration, the FSSAI has decided to remove potassium bromate from the list of permissible additives,” FSSAI CEO Pawan Kumar Agarwal said.

This harsh reality, that bread-makers are exposing the common man to cancer is nothing short of a criminal act and the bread-makers should be held accountable and prosecuted for such a grave offence. The Indian law provides adequate measures of protection in several laws. However the bread-makers have thrown caution to the winds and only look at profit motive exposing the public to such a dangerous health hazard as cancer. It is believed potassium bromate and potassium iodate helps to preserve bread for a longer time hence it is being used in the production of bread and bakery products.

Under The Prevention of Food Adulteration Act, 1954 an article of food is deemed to be adulterated if the said food does not meet the nature, substance or quality as expected by the purchaser; or if the food contains any substance which affects the nature and quality of the food; or is a cheaper substance which is being substituted for the food; or if the food is deemed to be contaminated, or poisonous or is injurious to the health of the person consuming it. The provisions of the PFA Act mandate that the manufacturer of the food article is under a responsibility to ensure that the food manufactured meets the specifications and quality mentioned in the Act. The Food Health Authority has the power to take action against any manufacturer if they do not meet the standards set out in the PFA Act.

Under the PFA Act any person guilty of breaching of PFA Act and selling adulterated and sub-standard food article is liable to prosecution and fine. Punishment can range from one year to six years depending on the offence committed and in case of death of a consumer the manufacturer will be liable for imprisonment for life.

 

Parul

Senior Associate

The Indian Lawyer

FREEDOM OF SPEECH

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“Everyone is entitled to his own opinion, but not to his own facts.” –  Daniel Patrick Moynihan

Common understanding of freedom of speech is that we are free to say anything we want, as long as our speech does not interrupt upon the ‘fundamental freedoms’ of others. The idea is that one’s freedom of speech must not cause ‘harm’ to others.

Freedom of speech and expression guaranteed under Article 19(1)(a) of the Constitution of India has been regarded as the second most important right after the right to life of a citizen. However, it is not an absolute right, there are restrictions specified under Article 19(2) of the Constitution of India. Rights come hand in hand with responsibilities.

According to Article 19(2) of the Indian Constitution, the legislature is empowered to impose certain restrictions on free speech under the following heads:

  • Security of the State
  • Friendly Relations with Foreign States
  • Public Order
  • Decency and Morality
  • Contempt of Court
  • Defamation
  • Incitement to an Offence, and
  • Sovereignty and Integrity of India

If one takes a closer look at these imposed restrictions, it becomes clear how often this very ‘Freedom of Speech’ is subject to misuse.

In recent times, it appears to be the most misused right in India, especially on the internet. If one spends more than two minutes on the Internet, one will probably come across trolling, bullying, insincere but deliberately hurtful comments and other things that no one would say on another person’s face.

Freedom of speech on the internet is scaling new heights every day with complete disregard for the restrictions specified under Article 19(2). People post their views the moment they come across a statement. Mostly, it either gets a thumbs up or sarcastic criticism.

With the explosion of social media, internet trolling is becoming a big challenge, especially for women users on social media. In recent times, there is a growing voice against this online harassment especially faced by women in power, whether it’s celebrities, journalists or politicians. Men are also subjected to online abuse and hate speech, they are generally attacked on professional grounds whereas women have to tolerate personal attacks, including references to their bodies and sexual as well as actual threats of violence, particularly sexual violence.

While there have been growing voices to set up a mechanism to control online trolling, government officials believe, it is not possible to regulate or check online abuse and trolling as jurisdictions are territorial. While they do acknowledge the role social media has played as an instrument of promoting freedom of expression as well as empower people, some officials believe that if growing misuse of social media channels does not come down, the medium may burn itself out and lose credibility.

To be sure, freedom of speech does not mean the other side has an obligation to listen. But it also does not mean that the other side can be shouted down. Indeed, someone will say something that you consider obscene, tasteless, offensive or insulting to something or someone you value.

 The Indian law provides for prosecution as well as damages for misuse of freedom of speech. Hence people who take pleasure in bringing disrepute to others should caution themselves as the law can be stringent and punitive.

In conclusion, freedom of speech must always be accompanied by restrained in order not to cause damage or bring disrepute to others.

 

Parul

Senior Associate

The Indian Lawyer

IDENTITY THEFT

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YOUR IDENTITY GOES EVERYWHERE

(Start Protecting Your Identity Today)

“But he that filches from me my good name/Robs me of that which not enriches him/And makes me poor indeed.” – Shakespeare, Othello.

Identity Theft (ID Theft) is the deliberate use of someone else’s identity, usually as a method to gain a financial advantage or obtain credit and other benefits in the other person’s name and to the other person’s disadvantage or loss.

ID Theft is used to refer to the fraud of impersonating someone else to steal money or get other benefits. The person whose identity is used can suffer various consequences when he/she is held responsible for the perpetrator’s actions. Examples include fraudulently obtaining credit card details, stealing money from bank accounts, establishing accounts with utility companies, renting an apartment or even filing bankruptcy using the victim’s name. The cyber impersonator can steal unlimited funds in the victim’s name without the victim even knowing about it for months, sometimes even for years.

Cases of identity theft fall under three broad categories: hacking social media accounts, stealing credit and ATM card details, and stealing employee data.

PREVENTION IS THE KEY:

  • Memorise passwords don’t keep it noted anywhere.
  • Never give any of the personal information to anybody.
  • Get credit cards and business cards with the picture of the owner on them.
  • Do not put the credit card account number on the Internet (unless it is encrypted on a secured site.) Don’t put account numbers on the outside of envelopes, or on the cheques.
  • Monitor all the bank statements from every credit card every month. Check to see if there is anything that one does not recognize and call the bank to verify that the genuineness of the cash transaction.
  • Order the credit report at least twice a year. Review it carefully. If there is anything that appears fraudulent, immediately put a fraud-alert to the bank and contact the police.
  • Don’t carry your birth certificate or passport, unless necessary.
  • Cancel all credit cards that do not use or have not used in 6 months. Thieves use these very easily – open credit is a prime target.
  • Delete all information on a computer before selling, giving away, or disposing it off. While it may not be practical consider destroying the hard drive. If not practical, consider deleting or destroying the information contained on the drive.
  • Be careful at ATM’s and using Phone Cards. “Shoulder Surfers” can get your “Pin Number” and get access to another person’s account.
  • Use virus protection software always and make sure it’s updated regularly. Most AV (anti-virus) packages have an option to retrieve updates on a regular basis.

If you are a victim of identity theft immediately block the card. Give details of amount debited. Get a reference number.

A victim of Identity theft can file a complaint for online fraud and approach the Cyber Cell. For other fraud, lodge a complaint with nearest police station but before that you must collect evidence against the impersonator and then file a complaint attaching all the details.

Identity theft is a criminal offence and punishable under Information Technology Act. The punishment is imprisonment for 3 years and fine up to Rs. 1 lakh.

 

Parul

Senior Associate

 

 

 

IMPORTANCE OF A LAWYER

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WHY IS A LAWYER IMPORTANT?

(Prevention is better than cure)

A lawyer is qualified to give a legal advice and assistance to clients and represent them in court or in other legal matters.

From signing a contract to buying a house, every phase is affected by the legal system. Thus, lawyers hold huge accountability in maintaining and adhering to a strict code of ethics.

A lawyer may specialize in different areas like intellectual property, environment law, bankruptcy, aviation, etc. They represent you in Court, business transactions and other legal proceedings wherein the law would be discussed. They act like a “repairman”, and fix what is broken on behalf of the Client.

Every legal matter does not require the use of an attorney. However, in many situations involving a legal dispute, one may not wish to take the risks of going through it alone without the advice of an experienced lawyer who can help out. In fact, while good legal representation may not be cheap, it can help in getting out of a number of sticky situations – such as a bad divorce, lost job, including broken agreements, lost claims, or worse, jail time.

While each person’s legal situation is different, a lawyer is required for the following reasons:

The law is complex:

The law is complicated in nature. In some situations even experienced     lawyers cannot represent themselves in court. Failing to hire a lawyer when starting a business, reviewing a contract or other situations with potential legal action can result in avoidable pitfalls.

Having a lawyer can save money:

A civil case could hurt financially in the long run while a criminal case may compel a person to spend time behind bars. Hence, hiring a lawyer at the right time and acting upon his/her advice can actually save money.

Lawyers know how to challenge (and sometimes suppress) evidence:

 A common man may not even know that a key piece of evidence is important for his case and can help him in winning the case. Only a qualified lawyer would be the correct person to assess the evidentiary value of documents that may be in the possession of a prospective litigant.

Attorneys understand how to properly file court documents and handle other legal procedures:

If you’re not an attorney, you may struggle with the deadlines and protocol for properly filling out and filing certain legal documents. One late or incorrect filing could delay your case or have the case thrown out altogether.

Prevention is better than cure:

Hiring a lawyer in many instances can help one avoid potential legal headaches down the road.  A lay man may not understand the terms of the contract that he has to sign and may end up signing a contract that would be counterproductive in the long run. Hence, engaging a lawyer can help to prevent future problems.

 

Sanchayeeta Das

Associate

The Indian Lawyer

LIMITED LIABILITY PARTNERSHIP

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Limited Liability Partnership concept was introduced in India by way of Limited Liability Partnership Act, 2008. It is a preferred mode of doing business in several Countries. A Limited Liability Partnership is a corporate business vehicle that provides both the benefits of a company and flexibility of a partnership firm i.e. limited liability and allows its partners the flexibility of organising their internal structure as a partnership based on a mutual agreement. This structure is available to small business start ups and service industries.

A corporate entity status enables LLP to be taken more seriously than a proprietorship/partnership status does. LLPs also have many advantages over proprietorships, partnerships and limited companies, as elaborated below:

  • A LLP is very easy to form with less formality. It can be formed with least possible capital. There is no minimum capital requirement.
  • A LLP is a legal entity, a juristic person established under the Act.It has its existence separate from its partners.
  • A LLP requires a minimum 2 partners while there is no limit on the maximum number of partners.
  • The liability of partners is limited to the contribution to the LLP, as it has separate legal entity from its partners. Their personal assets are free from the liabilities of LLP. Liability for repayment of debts and lawsuits incurred by the LLP lies on it and not on the partners.
  • In LLP, Partners unlike partnership are not agents of the partners and therefore they are not liable for the individual act of other partners in LLP, which protects the interest of individual partners.
  • In case of LLP, there is no such mandatory requirement to get their accounts audited. This is perceived to be a significant compliance benefit. Audit is not required unless capital exceeding Rs. 25 lakh or turnover exceeding Rs. 40 lakh.
  • In a LLP, there are less regulatory formalities and compliances. A LLP is required to file only two, namely, the Annual Return & Statement of Accounts and Solvency.
  • For income tax purpose, LLP is treated on a par with partnership firms. Thus, LLP is liable for payment of income tax and share of its partners in LLP is not liable to tax. Thus no dividend distribution tax is payable.
  • Provision of ‘deemed dividend’ under income tax law, is not applicable to LLP. Section 40(b): Interest to partners, any payment of salary, bonus, commission or remuneration allowed as deduction.
  • However, no such tax is payable in the case of LLP and profits of a LLP can be easily withdrawn by the partners.
  • In case of the death of the partner, a LLP will continue with other partners. The legal heirs of LLP will get the profit/contribution of the deceased partner. They are not entitled to become a partner of the LLP unless a LLP agreement can provide the same.
  • It is easy to become a Partner or leave the LLP or otherwise it is easier to transfer the ownership in accordance with the terms of the LLP Agreement and a partner can transfer his share of profit/loss in an LLP wholly or part subject to the LLP agreement.
  • If a LLP becomes insolvent and is wound up, only the assets of the LLP are used to clear its debts.The partners of LLP have no personal liabilities and are not made bankrupt and are free to operate as credible businessmen.
  • A LLP has an easy procedure to dissolve or wind-up.
  • There is less Government Intervention in a Limited Liability Partnership. Limited Liability Partnership Act, 2008 gives LLP the at most freedom to manage its own affairs. Partners can decide the way they want to run and manage the LLP, in form of LLP Agreement.
  • Body corporate can be a partner of a LLP.
  • As a juristic legal person, a LLP can sue in its name and be sued by others. The partners are not liable to be sued for dues against the

 

Parul

Senior Associate

The Indian Lawyer

RELEVANCE OF NEW NATIONAL IPR POLICY

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CREATIVE INDIA: INNOVATIVE INDIA

 

All Intellectual Property Rights (IPR) in India were governed by the TRIPS. Now for the first time Government of India has adopted a pro-active approach towards drawing a roadmap for IPR in the country and has come out with a Policy to improve investment climate in the country as well as promote innovation and improve national competitiveness; India has even declared this decade as the ‘Decade of Innovation.”

The Policy seeks to balance the goals of economic growth and social justice, and makes important recommendations towards the same. However, there are some areas where the Policy could have made more comprehensive recommendations. In particular, it would be important to ensure that India’s rich repository of traditional knowledge – particularly in areas like medicine – is offered the same level of intellectual property protection as other products and processes. In order to make the Policy a success it is  important for state governments to play the role of constructive partners in creating and maintaining a robust, equitable and predictable IPR regime. They can do this by establishing State level Innovation Councils and strengthen them through financial and other support.

Objectives:

The Policy lays down the following seven objectives:

  1.   IPR Awareness: Outreach and Promotion – To create public awareness about the economic, social and cultural   benefits of IPRs among all sections of society.
  2.   Generation of IPRs – To stimulate the generation of IPRs.
  3.   Legal and Legislative Framework – To have strong and effective IPR laws, which balance the interests of rights   owners with larger public interest.
  4.   Administration and Management – To modernise and strengthen service-oriented IPR administration.
  5.   Commercialisation of IPRs – Get value for IPRs through commercialisation.
  6.   Enforcement and Adjudication – To strengthen the enforcement and adjudicatory mechanisms for combating    IPR infringements.
  7.   Human Capital Development – To strengthen and expand human resources, institutions and capacities for   teaching, training, research and skill building in IPRs.

Each program or activity under the objectives will be bench marked with the best parameters applicable to the Indian situation. Monitoring the progress of implementation of the National IP Policy, linked with performance indicators, targeted results and deliverables will be done.

As per Article 39 of the Constitution of India, “the State shall in particular, direct its Policy towards securing that the ownership and control of the material resources of the community are so distributed as best to serve the common good.” The National IPR Policy is contoured in a manner that it encourages greater use of exceptions and limitations to the otherwise exclusionary use of intellectual property, encourages the expansion of the public domain, secures proportionality in enforcement of IP rights, and promotes alternatives to IP.

 

Mayank Singh Raghuvanshi

Senior Associate

The Indian Lawyer

 

THE IMPORTANCE OF WELL DRAFTED DOCUMENTS

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Though this is one of the most crucial aspects of a business or while purchasing an asset, this is completely ignored by one and all, in their poor understanding of the importance of well drafted documents. Most people do not grasp the consequence of poorly drafted documents which are very often a cut and paste job. It is only when disputes arise that people realise the mistake of not having considered the importance of a well drafted document.

Has anybody been able to understand why a person putting his entire life’s earnings in buying the much coveted flat or office fails to engage a good lawyer for drafting such a document. It is a general reaction that by taking a draft that is already available, that is, with the property dealer or available on the internet they can get a foolproof document. Mostly, such documents are driven by the fact that the person using it is saving pennies. Alas a fallacy as the so called foolproof document makes a fool of the person who has availed of it and it is a classic case of penny wise pound foolish. A well drafted document can save the client several legal headaches that are bound to arise when the drafted document is not customised or does not have essential information or fails to provide an indemnity in case things go wrong.

Even in the commercial world we have seen corporates making the mistake of using an earlier drafted document by merely changing the names and other details without realising the consequence of poorly drafted documents. When things go wrong the corporate can actually end up paying several hundred times the cost of a good document. In today’s fast moving commercial world rights and liabilities of parties must be set out in the written form and that too drafted by a lawyer well versed in commercial laws. Such timely action can prevent problems that would have routinely surfaced had the document been a poor draft.

Lastly and finally the most important aspect would be that when a party moves the Court or Arbitrators for enforcement of his/its legal rights, not much can be done by way of relief if the basic document that determines different aspects of the relation between the parties to the Contract are silent or missing. At the final stage no amount of oral arguments talking about the real intention of the parties can help the aggrieved party from getting relief.

 

Sushila Ram Varma

Chief Legal Consultant

The Indian Lawyer