CENTRAL INFORMATION COMMISSION HELD THAT ELECTRONIC VOTING MACHINE IS ‘INFORMATION’ UNDER RIGHT TO INFORMATION ACT 2005

The Chief Information Commissioner (CIC), Mr. Sudhir Bhargava, in the case of Razaak K Haidar vs. CPIO, Election commission of India, New Delhi has held on February 12, 2019 that Electronic Voting Machine (EVM) falls under the definition of ‘information’ within the meaning of Section 2(f) of the Right to Information Act, 2005 as amended thereof (the Act).

In the above case, Appellant had filed an RTI Application with the Election Commission of India (ECI) seeking an EVM. In response, the Central Public Information Officer (CPIO) the Respondent herein refused the Appellant’s Application seeking EVM stating it does not qualify to be ‘information’ within the meaning of Section 2(f) of the Act.

The Appellant who attended the hearing through video-conference submitted that the Respondent had wrongfully denied the information under Section 6(1) of the Act. The Appellant contended that as per Section 2(f) and 2(i) of the Act, the definition of ‘information’ and ‘record’ includes model or any sample. Hence, an EVM qualifies as ‘information’ and should be provided to him under Section 6(1) of the Act.

Aggrieved with the decision of the ECI, the Appellant approached the CIC and contended that, according to Section 2(f) and 2(i) of the Act EVM qualifies as ‘information’ and so it should be provided to him under Section 6(1) of the RTI Act. The Respondent, ECI under-Secretary Shri Soumyajith Ghosh argued that ‘the model/samples of the EVM available with the ECI, are only kept for training purposes and are not saleable to the general public’. The Respondent further stated that the software installed in the EVM is an Intellectual Property of a third party, the disclosure of which would harm the competitive position of the third party concerned. Therefore, the said information is exempted from disclosure under Section 8(1)(d) of the Act.

CIC relying upon the definition under Section 2(f) of the Act held that the EVM which is available with the Respondent in a material form and also as samples, is ‘information’ under the RTI Act. The Commission also notes that as per the Respondent, the software installed in the EVM is an Intellectual Property of a third party, the disclosure of which would harm the competitive position of the third party concerned.

However, in favor of the Appellant, the CIC held that the Respondent had denied the information sought by the Appellant erroneously, under Section 6(1) of the Act. The Commission, therefore, directed the Respondent to provide an appropriate reply, as per the provisions of the Act to the Appellant within four weeks from the date of receipt of a copy of this Order.

Sidharth Sudheer

5th year, Mar Gregorios College Of Law, Kerala

Legal Intern, The Indian Lawyer

With

Suchit Patel

Associate

The Indian Lawyer

SUPREME COURT OF INDIA REFUSES TO GRANT STAY ON BAN IMPOSED BY THE MADRAS HIGH COURT ON TIKTOK APP

The Chinese-owned TikTok video app (App) enables the users to create short videos with music in background and then edit, speed up or slow them down. It also uses artificial intelligence to track user’s interests and thus displays personalized content too.

Recently, in India there have been concerns about the negative impact that the App may potentially have on children. For instance, a 19-year-old boy in Delhi lost his life while posing for the TikTok video where his friend shot him with a country made pistol. In a similar instance, a student from Tamil Nadu was also killed while riding a scooter when he along with his friends were trying to make a TikTok video. Many other such instances have occurred across other states in India.

On 1st April 2018, Advocate and Social Activist, Mr. Mathu Kumar, filed a Public Interest Litigation before the Madras High Court seeking ban of TikTok App because of its pornographic content and its potential to expose children to sexual predators. The Madras High Court had demanded the Centre to ban TikTok App and also, had prohibited any broadcast of media content created on TikTok App.

Although TikTok App has raised the issue that such videos and other content can also be accessed and shared by people on other social media platforms including Facebook, Instagram, YouTube, WhatsApp, etc, therefore, such selective actions solely against the App is morally and legally wrong. Further, being an intermediary under the Information Technology Act, 2000, as amended thereof, they are not responsible for the contents posted by the third party using the App, as they only provide the technology to make such videos.

In response to the Order of the Madras High Court dated 3rd of April, 2019, the TikTok App has removed six million videos that didn’t comply with community guidelines. On 15th April, 2019, the Supreme Court refused to grant a stay on the ban ordered by Madras High Court vide Order dated 3rd of April, 2019. As a result, the App was removed from the Apple App Store and the Google Play Store on 18th of April, 2019.

So far, the Indian Government has not yet raised any issue of potential threat to national security through the App. In fact, the ban mostly revolves around the issue about unsuitable content that can be uploaded, downloaded and shared by users of the App and that post ban, the existing registered users of the App could still access the App and share the videos.

Thus, in this case, the Apex Court has directed the Madras High Court to decide in an ex parte ad-interim order, by 24th of April, 2019, with regard to the ban imposed by its Order dated 3rd of April, 2019, failing which the ban imposed on the App would be overturned.

Asif Khan

Associate

The Indian Lawyer

SUPREME COURT OF INDIA HOLDS THAT NOTICES DEMANDING LOAN AMOUNT ARE NOT INVALID UNDER THE NEGOTIABLE INSTRUMENTS ACT, 1881.

The Supreme Court of India in the case of Vijay Gopala Lphar vs Pandurang Ramchandra Gharpade & Anr., passed a judgement dated 05.04.2019 holding that the notice demanding ‘Loan Amount’ is not invalid if it is same as the ‘Cheque Amount’ under Section 138 of Negotiable Instruments Act, 1881 (“the Act”) as amended thereof.

In the above case the Appellant had taken a hand loan of Rs. 50,000/- (Rupees Fifty Thousand only) from the Respondent/Complainant with a promise that he would return the amount within six months. The Complainant issued 2 cheques of Rs. 25,000/- (Rupees Twenty Five Thousand only) each to the Respondent/Complainant for a legally enforceable debt. The cheques where deposited by the Respondent/Complainant which were dishonoured due to “Funds Insufficient”. The Respondent/Complainant then on 04.03.2008 issued two notices to the Appellant and further filed two separate complaints under Section 138 of the Act each notice with the amount of Rs. 25,000/- (Rupees Twenty Five Thousand only). The Trial Court held the notices defective because the Respondent/Complainant mentioned loan amount and not cheque amount, which according to the Court were contrary to Section 138 of the Act.

The Respondent/Complainant appealed in the High Court at Bombay, which held that, there was no failure on the part of the Respondent/Complainant in making a demand for the payment of amount by issuing the notices. The High Court held that the term ‘loan amount’ should not have been mentioned but however the High Court was convinced that the Respondent/Complainant demanded the payment of Rs. 50,000/- (Rupees Fifty Thousand only) which was the original initial amount that was supposed to be claimed. The High Court reversed the Trial Court’s judgement and convicted the Appellant.

The Appellant further appealed in the Superme Court of India. The Appellant relied upon the clause (b) of the provision of Section 138 of the Act stating that the demand by notice should be only for the cheque amount and not on the loan amount. The counsel for Appellant relied upon the judgement in the case of Suman Sathi vs Ajay K. Churwal & Anr. (2000) 2 SCC 380, Rahul Builders vs Arihant Fertilizers & Chemicals & Anr. (2008) 2 SCC 321 and in support of his claims that the notices under Section 138 of the Act can be issued only for the cheque amount and not for any other amount. The Apex Court upon examining the above mentioned judgements held that, there is no question that the notices issued under section 138 of the Act has to be exclusive for the cheque amount. In the judgements referred above, the notices issued under Section 138 of the Act refer to the loan amounts which were much higher than the cheque amount. Whereas, in the present suit, the loan amount and the cheque amount is the same i.e. Rs. 50,000/- (Rupees Fifty Thousand only). Therefore, the above referred judgements cited by the learned counsel for the Appellant are not applicable to the current case. Hence, the Apex Court dismissed the appeal.

B Suchit Patel

Associate

The Indian Lawyer

ELECTION COMMISSION OF INDIA AND PRESS COUNCIL OF INDIA ISSUE GUIDELINES PERTAINING TO MEDIA COVERAGE DURING ELECTIONS 2019

The Election Commission of India (ECI) and the Press Council of India (PCI) had issued certain guidelines to regulate the media coverage with regard to elections and exit polls, etc in order to ensure fair elections. It is also necessary for the media to adhere to the principle of fair and objective reporting of the election campaign and the candidates.

The ECI has recently notified on 07.04.2019 (Sunday), the period between 7.00 A.M on 11.04.2019 (Thursday) and 6:30 PM on 19.05.2019 (Sunday) (Prohibited Period) as the period during which the conduct of exit poll, publication or publicity of the result of any exit poll in print or electronic media or in any other manner, in connection with General Elections to Lok Sabha and other Legislative Assemblies, has been prohibited. Further, any kind of predictions of results of election, etc by astrologers, tarot readers, political analysts or by any other persons and telecast or publication of any such predictions during the Prohibited Period has also been forbidden in order to ensure free, fair and transparent election.

Further, the PCI also requires that the Press should endeavour to inform the public in an objective manner, about appropriate electoral matters, political parties, candidates, voting processes, etc, but not indulge in unhealthy election campaigns, exaggerated reports about any candidate/party or incident during the elections and other such activities as listed below:

  1. That the Press should avoid reports which tend to promote communal or caste related feelings, amongst public.
  2. The Press should refrain from publishing false or critical statements about any party or candidate and also not accept any kind of financial or other offers to promote a candidate or party.
  3. The Press should not publish any advertisement about the achievements of a candidate or party at the cost of public exchequer.
  4. The Press should follow the ECI Guidelines regulating media coverage during Prohibited Period and otherwise.
  5. The print or electronic media should not be used as a forum for distortions and manipulations of the elections.
  6. The news channels should disclose any political affiliations, either towards a party or candidate.

It is believed that the Press should behave with a sense of responsibility while reporting news related to elections, so that it enables the citizens to exercise their vote based on a well-informed choice.

Harini Daliparthy

Senior Legal Associate

The Indian Lawyer

JOB POST: Hiring lawyers with an experience of minimum 3-4 years @ The Indian Lawyer [Delhi and Hyderabad]

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  1. We are looking at hiring lawyers with an experience of minimum 3-4 years for our Delhi Office
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Depending on educational qualifications

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SUPREME COURT OF INDIA ISSUES DIRECTIONS TO ELECTION COMMISSION OF INDIA TO INCREASE THE NUMBER OF ELECTRONIC VOTING MACHINES IN RESPECT OF WHICH VOTER VERIFIABLE PAPER SLIPS WOULD BE VERIFIED

In a recent case of N Chandrababu Naidu & Ors vs Union of India and another 2019, the Supreme Court has directed the Election Commission of India (ECI) to increase the number of Electronic Voting Machines (EVMs), in respect of which Voter Verifiable Paper Audit Trails (VVPAT) paper slips would be physically verified.

According to ECI, Electronic Voting Machine (also known as EVM) is voting using electronic means to either aid or take care of the chores of casting and counting votes. Whereas, VVPAT is said to be an electro-mechanical machine, that contains a paper roll, a motor to run it, a system to print and cut the VVPAT slip. As soon as voters press a button against a candidate on the EVM to cast their vote, the VVPAT machine displays a printed VVPAT slip, for approximately 7 seconds, that contains the candidate’s serial number, name, corresponding symbol, thereby, allowing the voters to verify their respective votes. The VVPAT paper roll is said to be designed for printing 1,500 ballot slips for each election.

Therefore, in general, VVPAT machines are designed for the purpose of verification of votes by the respective voters and thus, to ensure that there is transparency and credibility of the election process. But they are used by polling officers as well for the purpose of counting the VVPAT paper slips in order to verify the result obtained from the control unit of the EVM. Eventually, ECI made it mandatory to verify the counting of VVPAT paper slips in one randomly selected polling station in each Assembly Constituency/each Assembly Segment of Parliamentary Constituency.

In the aforesaid case, the Petitioners had sought for verification of VVPAT paper trail of 50% of the EVMs. But as per ECI, the verification of VVPAT paper trail of one EVM is done by a team of three Officers under the direct supervision of the Returning Officer appointed by ECI for smooth conduct of elections and that the whole process takes about an hour. But verification of VVPAT paper trail of 50% of the EVMs may delay the declaration of the result of election by 5-6 days.

The Supreme Court held that even if the number of EVMs, in respect of which VVPAT paper slips are to be verified and subjected to physical scrutiny, is increased from 1 to 5, the ECI would still be in a position to provide the additional manpower that would be required and as a result, there would be no delay in the declaration of the result of the election. This would help to attain a greater degree of satisfaction with regard to the accuracy of the election results. Thus, the Apex Court directed that 5 randomly selected EVMs would now be subjected to verification so far as VVPAT paper trail is concerned in each Assembly Constituency/each Assembly Segment of Parliamentary Constituency.

Harini Daliparthy

Senior Legal Associate

The Indian Lawyer

SUPREME COURT OF INDIA HOLDS ONE-SIDED AND UNFAIR CLAUSES OF APARTMENT BUYER’S AGREEMENT TO BE NOT BINDING ON BUYERS

In a recent case of Pioneer Urban Land & Infrastructure Ltd. Vs. Govindan Raghavan 2019 and Pioneer Urban Land & Infrastructure Ltd. Vs. Geetu Gidwani Verma & Anr., the Supreme Court has passed a Common Judgment dated 02.04.2019 and held that a builder cannot seek to bind a buyer with one-sided and unfair contractual terms of an Apartment Buyer’s Agreement (‘Agreement’).

In the said case, the Buyer had deposited Rs. 4,83,25,280/- with the Builder for purchase of a flat in Araya Complex, Gurugram (the ‘Flat’), but the Builder had failed to obtain the occupancy certificate within the stipulated time period of 39 months with a grace period of 180 days and therefore, could not offer possession of the Flat to the Buyer within the time period agreed by them vide Agreement dated 08.05.2012.

As a result, the Buyer had approached the National Consumer Disputes Redressal Commission (NCDRC), whereby the NCDRC directed the Builder to pay compensation to the Buyer and also awarded interest for a part of the period of delay, vide Order dated 23.10.2018.

Meanwhile, the Builder obtained the Occupancy Certificate on 23.07.2018 and issued a Possession Letter to the Buyer on 28.08.2018. But the Buyer refused to accept the same as they were no longer interested to buy the said Flat and were looking for a flat elsewhere. Aggrieved by the Order dated 23.10.2018 of the NCDRC, the Builder filed an appeal before the Supreme Court (‘Appeal’).

In the said Appeal, the Supreme Court held the Builder liable for the following reasons:

1.The following clauses in the Agreement were found to be unfair and one-sided, as they were favouring the Builder:

i. The Builder was entitled to charge 18% interest from the Buyer for delayed payments.

But the Buyer was entitled to charge only 9% interest from the Builder for delay in handing over possession of the Flat to the Buyer.

ii. The Builder had the right to serve a termination notice to the Buyer for breach of his contractual obligations and also, cancel the Agreement if the Buyer fails to rectify the breach or default within 30 days of the termination notice and also forfeit the entire amount of earnest money towards liquidated damages.

Whereas, in the event of default or breach by the Builder, then if the Buyer fails to exercise his right of termination within the time limit provided in the Agreement, the Buyer cannot terminate the Agreement.

2. Such unfair and unreasonable terms of contract would not be final and binding if it is shown that the flat purchasers had no option but to sign on the dotted line, on a contract framed by the builder.

3. In accordance with the Consumer Protection Act, 1986 as amended thereof, the incorporation of such clauses in an agreement constituted unfair trade practice, as the Builder had adopted unfair methods or practices for the purpose of selling the flats.

4. The Builder cannot compel the Buyer to purchase the Flat after causing an inordinate delay of almost 3 years in handing over the possession of the Flat to the Buyer.

5. Therefore, the Builder cannot seek to bind the Buyer with one-sided and unfair contractual terms of the Agreement.

Thus, the Apex Court directed the Builder to pay compensation and interest to the Buyer for the entire period of delay caused in handing over possession of the Flat to the Buyer.

Harini Daliparthy

Senior Associate

The Indian Lawyer

SUPREME COURT RESCUES INSOLVENT COMPANIES FROM MANDATORY BANKRUPTCY

In a recent Judgment passed by the Supreme Court of India in the case Dharani Sugars and Chemicals Ltd v Union of India dated 2nd April 2019, the Supreme Court struck down the  Reserve Bank of India ( “RBI”) Circular dated 12.02.2018 as unconstitutional and Ultra Vires.

Pursuant to said Circular the Banks were vested with the power to initiate insolvency proceeding if the board-approved policy for the resolution of stressed assets failed. The Circular entailed banks to start the Resolution Process as soon as a borrower defaulted on a term loan of 2000 crore or more and could not cure it in 180 days.

The source of power for the said Circular was derived from Section 35 AA and 35 AB of the Banking Regulation Act, 1949 (as and when amended). The Section was challenged as it was de hors the Insolvency and Bankruptcy Code, 2016 and thus arbitrary.

The Supreme Court held that without authorisation of the Central Government, no such directions can be issued. The Supreme Court, however, held that the RBI is empowered to exercise its right under Section 35 AA and that the Section, along with Section 35 AB (which gives power to the RBI to issue directions on stressed assets), was not manifestly arbitrary.

The result of this Judgment is that the banks and financial institutions are now free to take an independent call with regard to resolution of debts. Such decisions would depend from  case to case depending on the nature of default made by the borrower. The Judgment now opens avenues to rescue sick Companies outside court rather than forced insolvency proceedings acting detrimental to the interest of the Companies.

The Judgment has resulted in declaring all cases in which borrowers have been proceeded against by Financial Creditors as per the RBI Circular to be declared non- est.

The Judgment came as a major rescue for all industries that were facing action from banks owing to mandatory insolvency vide the circular of the RBI. There were genuine cases where companies unable to resolve stressed assets in such a short period of 180 days even though they were seriously making the efforts. This Judgment comes as a breather to them to help in resolving stressed assets and putting their company back on its feet.

This Judgment, however does not in any manner effect all genuine insolvency proceedings that have been initiated by financial or operational creditors who have not taken action under the RBI Circular.

Sushila Ram Varma

Chief Consultant

The Indian Lawyer

SUPREME COURT OF INDIA HOLDS THAT DEATH BY MOSQUITO BITE IS NOT AN INSURABLE PERIL

In the case of Branch Manager, National Insurance Co. Ltd vs. Mousumi Bhattacharjee decided on 26th March 2019, a very interesting question of law was determined by the Supreme Court of India. The Supreme Court was tasked to determine whether a death due to malaria occasioned by a mosquito bite in Mozambique, constituted a death due to accident and whether it constituted an insurable peril.

In the present case the legal heirs were seeking insurance claims under a non-life policy secured against a home loan. The Insured (deceased) took up a job as a manager of a tea factory at Cha-De-Magoma, Republic of Mozambique, South Africa. During his stay in Mozambique, the insured was diagnosed with encephalitis malaria and consequently died on 22 November 2012.

The heirs of the Insured sought insurance claim from the Insurance Company pleading that his sudden death due to mosquito bite in a foreign land was an accident. The West Bengal State Consumer Disputes Redressal Commission (“State Commission”) concurred with the Petitioners and held that death caused due to mosquito bite was indeed an accident and thus allowed the insurance claim of the Petitioners.

Aggrieved by the order of the State Commission, the Insurance Company preferred an appeal in the National Consumer Disputes Redressal Commission (“NCDRC”). The NCDRC upheld the order of the State Commission. Aggrieved by the order of the NCDRC, the Insurance Company preferred an appeal before the Supreme Court (“Appeal”).

In the said Appeal, the Supreme Court held that where a disease is caused or transmitted by insect bite/virus in the natural course of events, it would not be covered by the definition of an accident. Death due to malaria from mosquito bite cannot be considered as death due to an accident, in a place like Mozambique which is a malaria prone region.

The Apex Court was of the opinion that a disease may not fall for classification as an accident, when it is caused by a bodily infirmity or a condition. A person who suffers from flu or a viral fever cannot plead that it is an accident. Of course, there is an element of chance or probability in contracting any illness. Even when viral disease has proliferated in an area, every individual may not suffer from it.

Thus, the Supreme Court held that as a direct consequence of an accident such as a motor car accident, an individual may suffer bodily injuries, and/or succumb to his injuries, etc, in which case the death or disability may fall within the cover of a policy of accident insurance. But a bodily infirmity or death caused by a disease may not qualify as an accident, as it is neither unexpected nor unforeseen, and therefore, it is not a peril insured against in the policy of accident insurance.

Sonam

Legal Associate

The Indian Lawyer

SUPREME COURT OF INDIA HOLDS THAT DISHONOURED CHEQUES IN PURSUANCE TO AGREEMENTS TO SELL ARE MAINTAINABLE UNDER SECTION 138 OF NEGOTIABLE INSTRUMENTS ACT, 1881

The Supreme Court of India in the case of Ripudaman Singh vs Balakrishna, passed a judgement dated 13.03.2019 holding that the Complaint under Section 138 of Negotiable Instruments Act, 1881 (“the Act”) is maintainable when the cheques are dishonoured in pursuance to an Agreement to Sell.

In the above case the Petitioner entered into an Agreement to sell dated 28.05.2013 with the Respondent. The total sale consideration was Rs. 1.75 Crores. As per the Agreement Rs. 1.25 Crores was paid in cash and for the balance amount the Respondent issued two  post-dated cheques of Rs. 25 Lakhs each in favour of the Petitioners. The cheques were then presented for clearing and both the cheques returned unpaid with the banker’s remark “Insufficient Funds”. The Petitioners sent two Legal Notices to the Respondent under Section 138 of the Act.  

The Respondent filed two separate Applications pleading to discharge the respective Complaints to the Judicial Magistrate, First Class Indore. The applications were dismissed by the Judicial Magistrate.

The Respondent filed a Petition under Section 482 of The Code of Criminal Procedure (Cr Pc) in The High Court of Madhya Pradesh. The High Court allowing the petitions held that the cheques have not been issued for creating any liability or debt but for the payment of balance sale consideration. Further, the High Court quashed the Complaint under Section 138 of the Act affirming that the Respondent did not owe any money to the Petitioners.

The Petitioners further appealed in the Supreme Court of India. The Apex Court held that the cheques were not issued for creating any liability or debt, but ‘only’ for the payment of balance consideration and that in consequence, there was no legally enforceable debt or other liability. The cheques were issued under and in pursuance of the Agreement to sell, though it is well settled that an Agreement to sell does not create any interest in immoveable property, it nonetheless constitutes a legally enforceable contract between the parties to it. A payment which is made in pursuance of such an agreement is hence a payment made in pursuance of a duly enforceable debt or liability for the purposes of Section 138 of the Act.  

Suchit Patel

Associate

The Indian Lawyer