Picture1

According to the Goods and Services tax (GST) Laws, legal services have been made taxable based on reverse charge mechanism. Reverse charge has been defined to mean the liability to pay tax is on the recipient of supply of goods or services or both instead of the supplier of such goods or services, in respect of certain categories of intra-state supply of goods and services under the Central GST (CGST) Act 2017 or inter-state supply of goods and services under the Integrated GST (IGST) Act 2017, whichever applicable.

The Ministry of Finance had issued a Notification, No. 13/2017-Central Tax (Rate) dated 28.6.2017, which provided that the central tax leviable under section 9 of the CGST Act on certain categories of supply of services supplied by a person, shall be paid on reverse charge basis by the recipient of such services. One of such categories of supply of services included legal services provided by an individual advocate including a senior advocate or firm of advocates (supplier of service) to any business entity located in the taxable territory (recipient of service):

Services supplied by an individual advocate including a senior advocate by way of representational services before any court, tribunal or authority, directly or indirectly, to any business entity located in the taxable territory, including where contract for provision of such service has been entered through another advocate or a firm of advocates, or by a firm of advocates, by way of legal services, to a business entity.

 

The Central Board of Excise and Customs (CBEC) has clarified regarding certain compliances in respect of supplies under reverse charge mechanism:

  1. As per Section 24 (iii) of the CGST Act, 2017, every person who is required to pay tax under reverse charge has to register under the CGST Act, 2017.
  2. As per CGST Act and Rules, the following documents have to mention whether the tax in respect of supply in the invoice is payable on reverse charge:
  3. i) Every tax invoice, which is issued where the value of goods or services is more than two hundred rupees,
  4. ii) Every receipt voucher, which is issued against receipt of advance payment and
  • iii) Every refund voucher, which is issued in case, after issuance of receipt voucher, no supply is made and no tax invoice is issued.
  1. Any person making advance payment for supplies has also to pay tax on reverse charge basis.
  2. Upon supply of goods or services or both, the person liable to pay tax under Section 9 sub-section (3) or (4), has to issue a payment voucher at the time of making payment to the supplier.
  3. The electronic cash ledger, maintained on the Common GST Electronic Portal by a registered person liable to pay tax, has to be debited to pay an amount under reverse charge.
  4. Every registered person has to maintain records of all supplies attracting payment of tax on reverse charge basis.
  5. The information about all supplies that attract reverse charge has to be furnished separately, rate wise, in the Table 4B of GSTR-1.

Therefore, as per the GST Laws and the CBEC, the legal services, which include representational services, provided by an advocate or firm of advocates are liable for payment of GST under reverse charge by the business entity or the recipient.

Tags :

article

The Delhi High Court in a Bench comprising of Acting Chief Justice Gita Mittal and Justice C Hari Shankar issued notice to the Union of India, Government of NCT of Delhi and Delhi Police Commissioner on a public interest litigation (PIL) filed by social activist Sanjjiiv Kkumaar, for removal of loudspeakers from all religious structures on the ground that their use is an encroachment on a person’s “right to be left alone and spatial control” and thus violates the newly recognised fundamental right to privacy.

The Petitioner traced the advent of all religions in India and quoted that the loudspeakers were never part of any religion as they came into existence only in 1924, “Hinduism is 4,000 years old, Jainism is 2,600 years old, Buddhism is 2,500 years old, Christianity is 2,000 years old, Islam is 400 years old, Sikhism is 500 years old and on another hand, Moving coil current loudspeakers are not even 100 years old. Thus, it’s beyond doubt, and as facts and truth speaks for itself per se, loudspeakers were never a part of any religion

As loudspeakers is not part of/or intrinsic to any of the religions as all religions are 4,000 to 500 years old whereas loudspeaker came into existence in 1924, that is less than 100 years and hence, banning them will not violate Article 25 or 26 of the Constitution of India, 1949”.

This observation of Hon’ble Apex Court is of utmost importance as what Supreme Court says, Loudspeakers do exactly opposite of the same and hence violate fundamental rights of citizens of India,” this plea referred to the landmark judgement of the Supreme Court in Forum, Prevention of Environment and Sound Pollution which declared the Right to Privacy as a Fundamental Right quoted as, “No religion ever says to force the unwilling to listen to expressions of religious beliefs.

It also quoted an observation made by Justice DY Chandrachud in the privacy judgment that “one’s house is like a castle to him. If loudspeakers are encroaching one’s right of spatial control (one’s home), one’s right to left alone, then what’s the meaning of fundamental rights? It will be just on paper. Hence to protect and uphold the fundamental rights of one’s “left alone”, “personhood (physical and mental peace), spatial control – Loudspeakers need to go”.

The Petitioner in his PIL said that use of loudspeakers certainly takes away the right of the citizens to speak with others, their right to read or think or the right to sleep, “Every democratic country sanctifies domestic life; it is expected to give him rest, physical happiness, peace of mind and security. In the last resort, a person’s house, where he lives with his family, is his “castle”; it is his rampart against encroachment on his personal liberty”.

The Petitioner also made his point by saying that, “There may be heart patients or patients suffering from nervous disorder may be compelled to bear this serious impact of sound pollution which has had an adverse effect on them. Toddlers, kids are equally affected,”.

The matter is further listed for hearing on 29th January 2018.

 

TARUNA VERMA

SENIOR ASSOCIATE

Tags :

Picture3

Recently, the World Bank has published the rankings for 190 economies in terms of their ease of doing business (EODB) at http://www.doingbusiness.org/rankings which are taken upto to June 2017. India has been ranked at 100 in terms of its EODB, thereby moving into the top 100 of the World Bank’s EODB global rankings from its 130th position last year.

The overall ranking of the economies in terms of their EODB as well as category-wise ranking ranges from 1–190. A high ease of doing business ranking implies that the regulatory environment is more favorable and beneficial to the starting and operation of a local entity.

The following table indicates the overall as well as category-wise Doing Business (DB) Ranking of India by the World Bank for 2018:

SN TOPICS DB 2018 RANK
1. Overall 100

 

2. Starting a Business 156
3. Dealing with Construction Permits 181
4. Getting Electricity 29
5. Registering Property 154
6. Getting Credit 29
7. Protecting Minority Investors 4
8. Paying Taxes 119
9. Trading across Borders 146
10. Enforcing Contracts 164
11. Resolving Insolvency 103

 

Note: = Doing Business reform making it easier to do business.

These rankings are determined by sorting the aggregate distance to frontier (DTF) scores on 10 topics. An economy’s DTF is reflected on a scale from 0 to 100, where 0 represents the lowest performance and 100 represents the frontier. These DTF scores are taken as a basis to determine the overall ranking of an economy in terms of its ease of doing business.

The following are the DTF scores for Doing Business in India in 2018 as compared to that of in 2017 in various categories:

 

SN TOPICS DB 2018 DTF DB 2017 DTF Change in DTF (% points)
1. Overall 60.76

 

56.05

 

4.71
2. Starting a Business 75.40 73.69 1.71
3. Dealing with Construction Permits 38.80 36.17 2.63
4. Getting Electricity 85.21 85.17 0.04
5. Registering Property 47.08 46.83 0.25
6. Getting Credit 75.00 65.00 10.00
7. Protecting Minority Investors 80.00 76.67 3.33
8. Paying Taxes 66.06 47.67 18.39
9. Trading across Borders 58.56 57.61 0.95
10. Enforcing Contracts 40.76 38.90 1.86
11. Resolving Insolvency 40.75 32.75 8.00

 

According to the World Bank, the Government of India has initiated the following reforms under each category to make it easier to do business in India:

  • Starting a Business:

India has facilitated fast business set up by improving the online application system and allowing a common online application form for the Permanent Account Number (PAN) and the Tax Account Number (TAN).

  • Dealing with Construction Permits

India has implemented an online system of dealing with construction permits which may reduce the instances of lengthy and time taking procedures to obtain a building permit and has also streamlined the process at the Municipality of New Delhi and Municipality of Greater Mumbai.

  • Getting Electricity

The Government of India had in 2016 introduced an online application system for obtaining new commercial electricity connections, the Central Electricity Authority (CEA) has waived off the Electrical Inspector’s approval for internal wiring and installation, has made available to public the data pertaining to supply of electricity connections across Delhi and Mumbai, which may make it easier and faster to get electricity. The cities of Delhi and Mumbai have incorporated these reforms.

  • Getting Credit and Resolving Insolvency

India had introduced a new law, namely, the Insolvency and Bankruptcy Code 2016, which continues to focus on creditor driven insolvency resolution process. The creditors have the power to decide whether the debtor’s business is feasible to continue and the options for its revival, etc. Moreover, after the payment of the insolvency resolution process costs and the liquidation costs, the claims of secured creditors and the workmen dues stand as a priority to all other claims. These reforms may strengthen the access to credit in India.

Moreover, the Code has provided for time bound settlement of insolvency (180 days) by the National Company law Tribunal (NCLT), easier revival process or liquidation, participation of creditor in insolvency proceedings, etc which makes it easier for creditors, financial institutions and banks to deal with non-performing assets (NPAs) and to be aware of serial defaulters.

  • Protecting Minority Investors

The Companies Act 2013 has taken into consideration the importance of protection of minority investors. The independent directors are responsible for safeguard the interests of minority shareholders, for balancing the conflict of interests of all stakeholders, etc. If the investors are protected, the company may be able to raise the capital needed to grow, innovate, diversify and compete, otherwise, banks may become the only source of finance.

  • Paying Taxes

India has eased the tax compliance on businesses by providing an online platform for electronic payment of the Employees’ Provident Fund (EPF) and has introduced certain other measures to ease corporate income tax compliance.

  • Trading across Borders

The reduced cross border trade compliance costs in Delhi and Mumbai achieved by eliminating merchant overtime fees (which were to be paid by an assessee for availing the services of Central Excise Officers after the official hours) and the increased use of electronic platforms may help in reducing the time taken to comply with the import and export regulations.

  • Enforcing Contracts

The ‘Enforcing Contracts’ indicator measures the time and cost to resolve a standardized commercial dispute which can be determined from a comprehensive database of pending and disposed cases in the district courts of the country available at http://njdg.ecourts.gov.in. The computerization of court records across various states of the country has made it possible to collect and organize such data online.

Therefore, the Government of India has been introducing and improving several measures to attract foreign investments and facilitate ease of doing business in India.

 

Harini Daliparthy

Legal Associate

Tags :

registration

Introduction

The Registration Act, 1908 serves the purpose of proper recording and registration of documents/instruments, which give them more authenticity. Registration means recording of the contents of a document with a Registering Officer and preservation of copies of original document. Documents are registered for the purpose of conservation of evidence, assurance of title, publicity of documents and prevention of fraud.

Object of Registration Act

The object of Registration and inter-alia Registration Act is elaborately discussed by Hon’ble Supreme Court in case of Suraj Lamp and Industries Pvt. Ltd. versus State of Haryana and Another AIR 2012 SC 206, as under:

“The Registration Act, 1908, was enacted with the intention of providing orderliness, discipline and public notice in regard to transactions relating to immovable property and protection from fraud and forgery of documents of transfer.”

Registration of Document

The documents registrable under the Act fall under three categories.

In the first category, documents relating to transactions which according to the substantive law, can be affected only by registered documents. In order for a transaction to be valid must be effected by a registered instrument only. What it provides is that when there is a written instrument evidencing a transaction, it must, in certain cases, be registered. Under section 17 of the Registration Act, the compulsorily registrable documents are given.

In the second category, certain transactions can be effected without writing, i.e. partitions, releases, settlements etc. But, if the transaction is evidenced by a writing and relates to immovable property, the Registration Act steps in and clauses (b) and (c) of Section 17(1) of said Act require registration of such documents, subject to the exception specified in sub-section 2 of that section. If an authority to adopt is conferred in writing, other than a Will, it is also required to be registered vide section 17(3).

In the third category, it is open to the parties, if they so choose, to get certain documents registered at their option and this is permitted by section 18. ‘Will’ need not be registered but it is open to the parties to get it registered under the third category.

Under the Registration Act, the following documents are compulsorily registrable.

  1. Instruments of gift of immovable property.
  2. Other non-testamentary instruments which purport or operate to create, declare, assign, limit or extinguish, whether in present or in future, any right, title or interest, whether vested or contingent, of the value of one hundred rupees and upwards, to or in immovable property.
  3. Non-testamentary instruments which acknowledge the receipt or payment of any consideration on account of the creation, declaration, assignment, limitation or extinction of any such right, title or interest.
  4. Leases of immovable property from year to year, or for any term exceeding one year, or reserving a yearly rent.
  5. Non-testamentary instruments transferring or assigning any decree or order of a Court or any award when such decree or order or award purports or operates to create, declare, assign, limit or extinguish, whether in present or in future, any right, title or interest, whether vested or contingent, of the value of one hundred rupees and upwards, to or in immovable property.

 

Limitation for registration of a document

Limitation for registration of a document under Section 23 of the Act, subject to certain exceptions, any document other than a Will has to be presented for registration within four months from the date of its execution. The term ‘execution’ means signing of the agreement.

Section 17 deals with documents of which registration is compulsory. Whereas, sub-Section (2) of section 17 provides a dozen of exceptions to clause (b) and (c) of section 17(1).

Section 18 of Registration Act pertains to documents of which registration is optional. Word ‘may’ is used in textual of section 18.

The Registration Act strikes only at documents, and not at transactions. All that it enacts is that when a document is employed to effectuate any of the transaction specified in s.17 of the Registration Act, such document must be registered.

 

Sanchayeeta Das

Legal Associate

The Indian Lawyer

Tags :

Article 1

The real purpose of the Registration Act, 1908 (the Act) is to provide a method of public registration of documents so as to give information to people regarding legal rights and obligations arising or affecting a particular property, and to perpetuate documents which may afterwards be of legal importance, and to secure every person dealing with any property against fraud. The scheme of the Act is to consolidate the law relating to registration.

Registration lends inviolability and importance to certain types of documents. At the time of registration, it is very essential to see that the officer is duly competent to register a document and that the document is not presented to unqualified or a wrong registration circle, as otherwise such registration would be of no use or validity. If the language in the document is not understood by the registering officer, he shall refuse to register the document. Also, no non-testamentary deed relating to immovable property would be accepted for registration, unless it contains a description of such property sufficient to identify the same.

If an instrument is compulsorily registrable, it should be presented for registration before an officer who is competent to register such document which can be read under Section 17 of the Act. However, in case of an instrument which is not compulsorily registrable, it is complete without registration.

At this juncture, it is very essential to refer Section 18 of the Act, 1908 which deals with “Documents of which registration is optional”.

Section 18 of the Registration Act, 1908- Documents of which registration is optional

Any of the following documents may be registered under this Act, namely:

(a) instruments (other than instruments of gift and wills) which purport or operate to create, declare, assign, limit or extinguish, whether in present or in future, any right, title or interest, whether vested or contingent, of a value less then one hundred rupees, to or in immovable property;

(b) instruments acknowledging the receipt or payment of any consideration on account of the creation, declaration, assignment, limitation or extinction of any such right, title or interest;

(c) leases of immovable property for any term not exceeding one year, and leases exempted under Section 17;

(cc) instruments transferring or assigning any decree or order of a Court or any award when such decree or order or award purports or operates to create, declare, assign, limit or extinguish, whether in present or in future, any right, title or interest, whether vested or contingent, of a value less than one hundred rupees, to or in immovable property;]

(d) instruments (other than wills) which purport or operate to create, declare, assign, limit or extinguish any right, title or interest to or in movable property;

(e) wills; and

(f) all other documents not required by Section 17 to be registered.

 

TARUNA VERMA

SENIOR ASSOCIATE

Tags :

13-20

The Supreme Court held on Wednesday, 11th October, 2017 that sex with one’s minor wife will amount to rape. A Bench comprising of Justice Madan Lokur and Justice Deepak Gupta watered down an exception to Section 375 of the Indian Penal Code (IPC) which said sexual intercourse by a man with his wife not under the age of 15 would not amount to rape whereas the age of consent was 18 years.

The order came on a PIL by NGO ‘Independent Thought’ filed in 2013, demanding that clause (2) in Section 375 of the IPC be declared unconstitutional as it violated Articles 14 (right to equality),15 (right to non-discrimination) and 21 (right to live with human dignity) of the Constitution. The Petitioners argued that the exception clause went against the objectives of the Prohibition of Child Marriage Act, 2006.

 

The Petitioner challenged the exception on the ground that it permitted sexual intercourse with a girl child aged between 15 and 18 only on the grounds that she was married. The age of consent for sexual relationship should be treated as 18, irrespective of the marital status of the girl child, the petitioner contended.

The Apex Court held that, “In our opinion, sexual intercourse with a girl below 18 years of age is rape, regardless of whether she is married or not” and “Merely because child marriages have been performed in different parts of the country as a part of a tradition or custom does not necessarily mean that the tradition is an acceptable one, nor should it be sanctified as such. Times change and what was acceptable a few decades ago may not necessarily be acceptable today,”. Further held that “The exception in rape law under the IPC is contrary to other statutes, violates bodily integrity of girl child,” The Court also said that an exception in the rape law is discriminatory, capricious and arbitrary.

The Supreme Court ruling harmonises the definition of rape under the IPC with the Protection of Children from Sexual Offences Act (POCSO Act), 2012 that fixed the age of consent of the girl at 18 and also treats sex with a minor as crime, irrespective of her consent. It was also held by the Bench that “The exception carved out in the IPC creates an unnecessary and artificial distinction between a married girl child and an unmarried girl child and has no rational nexus with any unclear objective sought to be achieved. The artificial distinction is discriminatory and is definitely not in the interest of the girl child,..”

Taruna Verma

Senior Advocate

Tags :

Picture1

Recently, there has been a huge uproar against the mandate of the Government of India for every person to link his/her Aadhaar Card to various services of the banks, mobile service providers, Income Tax Department, etc and to avail benefits of various Government Social Welfare Schemes such as midday meals, disability pension, rehabilitation for Bhopal gas tragedy victims, etc. Although the Government may have passed this mandate with a view to keep a track of an individual’s financial transactions, a transparency in his/her property dealings and filing of tax returns, and to prevent any instances of money laundering, etc, but consequently, the public may have to bear a huge risk associated with mandatory linking of Aadhaar to the various databases.

There may be instances after an Aadhaar is linked with any of the databases, where the individual’s activities may get disclosed and monitored by the Government. For instance, if a person’s bank account is linked with his Aadhaar and he books a railway ticket online or does shopping online, that particular booking transaction, indirectly, may store the particular travel/shopping details, as the case may be. Moreover, when someone’s mobile number is linked with his Aadhaar, all the details about his calls, messages, etc may get monitored. As a result, it may pose to be a threat to the privacy of a person whose Aadhaar has been linked to the various databases.

The general public reportedly has opposed the mandatory Aadhaar-linking on the grounds of issues of surveillance and privacy, risk of identity theft and of information being stolen, replicated, faked or misused by third parties, including the enrollment agencies, who may gain access to the entire demographic and biometric database along with the allotted Aadhaar numbers. Moreover, when any unscrupulous and/or deceitful parties gain access to the biometric database of a person, such data may be put to wrong and illegal use by terrorists, anti-nationals, or illegal immigrants to finance terrorism, or execute organized crime in the country, it may render the objectives of mandatory linking of Aadhaar ineffective and counter-productive. It is generally believed that the hazards of Aadhaar-linking with the databases may outweigh the benefits that the Government may reap out of it.

The Supreme Court in a case of Justice K.S. Puttaswamy vs. Union of India 2017 SCC OnLine SC 996 on 24.08.2017 has held that the right to privacy is a fundamental right under Article 21 of the Constitution of India. Currently, a number of public interest litigations (PILs) have also been filed in the Supreme Court challenging the Government’s mandate of Aadhaar-linking to various such services on the grounds of issues of privacy, etc. But the Government has sought time from the Apex Court as they are in the process of drafting a data protection legislation.

Therefore, the Government has extended the deadlines for mandatory Aadhaar-linking in the following cases until the Supreme Court pronounces the verdict on this issue:

  • Permanent account number (PAN): 31.12.2017,
  • Mobile numbers: 06.02.2018,
  • Bank accounts: 31.03.2018,
  • Various Government Social Welfare Schemes: 31.03.2018, etc.

 

Harini Daliparthy

Legal Associate

Tags :

thumb-1920-78406

The Supreme Court, in the case of Arjun Gopal v. Union of India, has issued an order dated 09.10.2017 (Order) to ban the sale of fireworks (including fire crackers) in the territory of Delhi-NCR till 01.11.2017 in order to control the deteriorating quality of air in this region and to reduce the adverse effects of bursting fireworks during the festival of Diwali. The Apex Court has, therefore, ordered for suspension of licenses for storing and selling fireworks in the Delhi and NCR area and added that it may issue further orders depending on the situation that may emerge during the Diwali season.

The Supreme Court had issued a similar order last year when the bursting of fire crackers during Diwali appeared to be one of the major causes of worsening air quality in the Delhi-NCR area as a result of which various schools had to be closed and authorities had to take various measures on health emergency basis. The Supreme Court added that the impact of that order could only be tested during the festive season of Diwali.

According to the Order, although this suspension may have an adverse effect on the business of permanent and other license holders but currently, their primary concern is public health and to ensure that people are not compelled to breathe poor quality air, there is a dire need to ban the sale of fireworks in the Delhi-NCR area and to observe its resultant effect on the air quality.

This suspension has seen a huge uproar amongst the fireworks-manufacturers but on the other side, various doctors and environmentalists have happily welcomed this decision of the Supreme Court. The affected traders had filed an interim application on 13.10.2017 seeking modification of the Order of suspension of license for sale of firecrackers in the Delhi-NCR ahead of Diwali but the Apex Court has refused to modify the Order and stated that the traders had been granted temporary licenses only up to 21.10.2017 and therefore, in pursuance of the Order dated 09.10.2017, they may seek renewal of their temporary licenses w.e.f. 01.11.2017 and this request may be considered by the police authorities.

It has also been reported that the Supreme Court has said that most of the traders had already sold their old stock of fire crackers before the pronouncement of this Order and therefore, it may not entirely be a Diwali without bursting of crackers.

As a result, the effect of the Order dated 09.10.2017 on the air quality may be observed only after 01.11.2017 when the Supreme Court may decide on lifting of the ban or pass any other order, whichever it deems fit.

 

Harini Daliparthy

The Indian Lawyer

Tags :

huf

 

A Hindu Undivided Family (HUF) is a separate entity that can be created by members of a family, wherein the members are lineal ascendants or descendants. Hindus, Buddhists, Jains and Sikhs can open HUFs.

A single person cannot create an HUF. Usually the senior-most member of the family is considered the karta that is the person who manages the affairs of the HUF.

In a recent judgment of the Supreme Court of India in Adiveppa vs. Bhimappa, dated 6th September 2017 it was held that a property belonging to all its members is taken as joint property and a family member while staking a claim has to produce evidence if it is ‘self-acquired’.

In the case mentioned above, the Supreme Court was hearing an appeal challenging an Order passed by the Karnataka High Court in a family dispute pertaining to ownership and partition of agricultural lands. It upheld the High Court’s Order which had declared the property as joint property of the family.

The two Judge Bench comprising of Justice R.K. Agrawal and Justice Abhay Manohar Sapre said that the burden is always on a family member, claiming ownership over a part of property of joint family, to prove before a Court that it is his self-acquired property and not joint property of the family by placing oral or documentary evidence.

The Bench opined,  “It is a settled principle of Hindu law that there lies a legal presumption that every Hindu family is joint in food, worship and estate and in the absence of any proof of division, such legal presumption continues to operate in the family. The burden, therefore, lies upon the member who after admitting the existence of jointness in the family properties asserts his claim that some properties out of entire lot of ancestral properties are his self-acquired property,” the observed.

The Supreme Court further held that the Appellants had failed to prove that the property was self acquired and observed, “In order to prove that the suit properties described in Schedule ‘B’ and ‘C’ were their self-acquired properties, the plaintiffs could have adduced the best evidence in the form of a sale-deed showing their names as purchasers of the said properties and also could have adduced evidence of payment of sale consideration made by them to the vendee. It was, however, not done. Not only that, the plaintiffs also failed to adduce any other kind of documentary evidence to prove their self-acquisition of the Schedule ‘B’ and ‘C’ properties nor they were able to prove the source of its acquisition.”

The Supreme Court in its Order held that, “Not only that, they also failed to adduce any other kind of documentary evidence to prove their self acquisition of properties nor they were able to prove the source of its acquisition”. Thus, the Bench said it was obligatory upon the contesting family members to prove that despite existence of jointness in the family, properties were not part of ancestral properties but were their self-acquired properties and the petitioners failed to prove their claim.

Taruna Verma

Senior Associate

 

Tags :

addtext_com_MDIwODU2MTIxODkw

Supreme Court on 30th August 2017 in the matter of Bijoy Sinha Roy, by Legal Representative vs. Biwasnath Das and the Bench comprising of Justice A.K. Goel and Justice U.U. Lalit, heard an Appeal challenging an order passed by the National Consumer Disputes Redressal Commission (NCDRC), wherein it had rejected the complaint filed by a husband alleging death of his wife due to medical negligence. The Appeal contended that surgery was performed on the deceased woman at a nursing home which did not have an ICU.

The Apex Court observed, “We however, find that neither the State Commission nor the National Commission have examined the plea of the appellant that the operation should not have been performed at a nursing home which did not have the ICU when it could be reasonably foreseen that without ICU there was post operative risk to the life of the patient. There was no serious contest to this claim by the opposite parties.”

It, however, did not remand the matter back for fresh adjudication, considering the fact that the matter had been pending for the last 23 years. It then directed the accused doctor to pay a sum of Rs. 5 Lakh to the heirs of the deceased, directing him to deposit the said amount with the State Commission within 3 months.

However, Supreme Court subsequently issued directions to ensure speedy resolution of disputes and utilization of alternate dispute resolution mechanisms by the Consumer Fora.

In order to achieve the object of providing speedy remedy to a consumer, the Bench opined that steps can be taken under Section 24B of the Consumer Protection Act, 1986. It observed that since the NCDRC has administrative control over all the State Commissions, it is competent to introduce monitoring mechanism for speedy disposal of cases. Section 24B gives the NCDRC administrative control under the Consumer Protection Act, 1986, the Section states as follows:

(1) The National Commission shall have administrative control over all the State Commissions in the following matters, namely:—

(i) calling for periodical return regarding the institution, disposal, pendency of cases;

(ii) issuance of instructions regarding adoption of uniform procedure in the hearing of matters, prior service of copies of documents produced by one party to the opposite parties, furnishing of English translation of judgments written in any language, speedy grant of copies of documents;

(iii) generally overseeing the functioning of the State Commissions or the District Fora to ensure that the objects and purposes of the Act are best served without in any way interfering with their quasi-judicial freedom.

(2) The State Commission shall have administrative control over all the District Fora within its jurisdiction in all matters referred to in sub-section (1).”

The Apex Court has therefore directed the NCDRC to consider this aspect and formulate an appropriate action plan. Besides, it observed that the Commission may also consider the use of video conferencing facility for examining expert witnesses wherever necessary.

The Supreme Court further referred to Section 89 of the Code of Civil Procedure which deals with settlement of disputes outside the Court. It then directed the NCDRC to issue appropriate directions in this regard and held, “Even though strictly speaking, the said provision is applicable only to civil courts, there is no reason to exclude applicability to Consumer Fora having regard to the object of the said provision and the object of the consumer protection law. Accordingly, we are of the view that the said provision ought to be duly invoked by the Consumer Fora,”

The Bench clarified that it would be open to the NCDRC and the State Commission to coordinate with the National Legal Services Authority and the State Legal Services Authorities to achieve this objective.

TARUNA VERMA

SENIOR ASSOCIATE

Tags :