This article is written by Kaushal Kumar, pursuing a Diploma in Cyber Law, Fintech Regulations and Technology Contracts from Lawsikho.com. Here he discusses “Future of Cryptocurrency and Legal Aspects Related to it”.

Introduction

The word “virtual currency” refers to a completely intangible exchange medium which is not a legal tender but can be replaced by legal tender. Older types of “currency” that are not “legal tender” include replacements for paper-based currency such as army scripting and depression scripting. The word “virtual currency” has recently created an additional connotation that it only exists in an electronic or digital form and is only used as a medium of return between members of the internet or virtual currency society. Virtual currencies can be used to purchase virtual goods or redeem awards for online games, social media, or corporate loyalty programs.

A virtual currency subset is “cryptocurrency,” meaning an internet-based virtual currency in which cryptography validates the ownership of a particular unit of value. Its value differs with its market motion. In contrast to commodity-based currencies that derive their intrinsic value through the central authority, cryptocurrencies are not legal tendering and therefore their use involves an agreement between parties for a transaction. Bitcoins, for instance, have no physical existence and their ownership is through entries in a comprehensive database known as the “blockchain,” which is maintained over a peer-to-peer network. According to the Wikipedia, “a cryptocurrency (or cryptocurrency) is a digital asset designed to function as a medium of exchange that uses cryptography to secure its transactions, control the creation of additional units, and verify the transfer of assets.” Bitcoin was the first decentralized cryptocurrency created in 2009. Several other cryptocurrencies have come to realize since then. These are often referred to as ‘altcoins’ or ‘bitcoin alternative’. The decentralized control is related to the use in the role of a DLT or Distributed Ledger Technology of the blockchain-based transaction database of bitcoin. The cryptocurrencies transaction took place through a signed piece of data that is transmitted to the network and, if valid, ends up in a block in the blockchain in order to transfer ownership of a cryptocurrency amount to a designated digital address.

Future of Cryptocurrency

Some economic analysts predict that as institutional cash joins the market, there will be a large shift in crypto. In addition, crypto may float on the Nasdaq, which would further add legitimacy to blockchain and its uses as an alternative to standard currencies. Some predict that a verified exchange-traded fund (ETF) is all that crypto requires. An ETF would certainly make investing in Bitcoin simpler for individuals, but they still need to be the demand to want to invest in crypto, which some say may not be produced with a fund automatically.

Understanding Bitcoin

Bitcoin is a decentralized currency using peer-to-peer technology that allows the network to jointly perform all tasks such as currency issuance, transaction processing and verification. While this decentralization makes Bitcoin free from public manipulation or interference, the flipside is that there is no central authority to make sure things are running smoothly or back a bitcoin’s value. Bitcoins are digitally developed through a method of “mining,” which needs strong pcs to solve complicated algorithms and crunch numbers. They are presently being developed every 10 minutes at a pace of 25 Bitcoins and will be capped at 21 million, a level anticipated to be reached in 2140.

These features make Bitcoin essentially different from a fiat currency supported by its government’s full faith and credit. The issuance of fiat currency is an extremely centralized activity overseen by the central bank of a nation. While the bank regulates the quantity of currency issued in line with its monetary policy goals, theoretically there is no upper limit to the quantity of such issuance. Moreover, local currency deposits are usually insured by a government body against bank failures. A Bitcoin’s value depends entirely on what investors are prepared to pay for it at a moment. Also, if a Bitcoin exchange folds up, Bitcoin balance customers don’t have any recourse to get them back.

Bitcoin Future Outlook

Bitcoin’s future perspective is the topic of much discussion. While the economic media is proliferated by so-called crypto-evangelists, Harvard University Professor of Economics and Public Policy Kenneth Rogoff indicates that the “overwhelming feeling” among crypto proponents is that complete “cryptocurrencies market capitalization could explode over the next five years, growing to $5-10[ trillion].”

The asset class’s historical volatility is “no reason for panic,” he claims. Nevertheless, he tempered his optimism and that of Bitcoin’s “crypto evangelist” perspective of digital gold, calling it “nutty,” saying that its long-term value is “more probable to be $100 than $100,000.” Rogoff claims that unlike physical gold, Bitcoin’s use is restricted to transactions, making it more susceptible to a bubble-like fall. In addition, the energy-intensive verification method of the cryptocurrency is “significantly less effective” than schemes relying on “a trusted central authority such as a central bank.”

Increasing Scrutiny

The primary advantages of Bitcoin’s decentralization and transaction anonymity have also made it a favourite currency for a host of illegal operations including money laundering, drug peddling, smuggling, and procurement of guns. This attracted the attention of strong regulatory organizations and other government agencies such as the Financial Crimes Enforcement Network (FinCEN), the SEC, and even the FBI and DHS. FinCEN released regulations in March 2013 defining virtual currency exchanges and administrators as cash service enterprises, putting them within the scope of government regulation. The DHS froze an Mt. Gox account in May of that year–the biggest Bitcoin exchange–held at Wells Fargo, saying it broke anti-money laundering legislation. And in August, the Department of Financial Services in New York issued subpoenas to 22 emerging payment firms, many of whom handled Bitcoin, asking about their actions to avoid money laundering and protect consumers.

Alternatives to Bitcoin

Despite its recent issues, Bitcoin’s success and growing visibility since its launch has resulted in a number of companies unveiling alternative cryptocurrencies, such as:

• Litecoin Litecoin is currently considered the leading competitor of Bitcoin and is intended to process smaller transactions more quickly. It was founded in October 2011 as “a coin that is silver to the gold of Bitcoin,” according to founder Charles Lee. Unlike the heavy computer horsepower needed for Bitcoin mining, Litecoins can be mined by a normal desktop computer. The maximum limit of Litecoin is 84 million–four times the 21-million limit of Bitcoin–and it has a transaction processing time of about 2.5 minutes, about one-fourth of that of Bitcoin.
• Ripple – OpenCoin, a firm established in 2012 by technology entrepreneur Chris Larsen, introduced Ripple. Like Bitcoin, Ripple is both a payment system and a currency. The element of currency is XRP, which has a mathematical basis such as Bitcoin. Unlike Bitcoin transactions, which can take as long as 10 minutes to confirm, the payment mechanism allows the transfer of funds in any currency to another user on the Ripple network within seconds.
• MintChip – Unlike most cryptocurrencies, MintChip is, in fact, creating a government institution, the Royal Canadian Mint in particular. MintChip is an electronic value-holding smartcard that can safely pass it from one chip to another. Like Bitcoin, MintChip needs no private identification; unlike Bitcoin, the Canadian dollar is supported by a physical currency.

The Future

Some of the constraints currently facing cryptocurrencies–such as the reality that a computer crash can erase one’s digital fortune, or that a hacker can ransack a virtual vault–can be overcome in time by technological developments. What will be difficult to overcome is the basic paradox that covers cryptocurrencies–the more common they become, the more they are likely to attract regulation and public scrutiny that erodes the fundamental assumption for their existence.

While there has been a steady increase in the number of merchants who accept cryptocurrencies, they remain in the minority. To be used more commonly, cryptocurrencies must first achieve widespread recognition among customers. However, with the exception of the technologically skilled, their relative complexity compared to standard currencies will probably discourage most individuals.

A cryptocurrency aspiring to become component of the mainstream financial system may need to meet extensively divergent requirements. It would need to be mathematically complicated (to prevent fraud and hacker assaults) but simple to comprehend for customers; decentralized but with appropriate consumer protection and protection; and maintain user anonymity without being a conduit for tax evasion, money laundering and other nefarious operations. Since these are formidable criteria to meet, is it possible that in a few years ‘ time the most popular cryptocurrency could have attributes falling between heavily-regulated fiat currencies and the cryptocurrencies of today? While that chance looks remote, there is little doubt that Bitcoin’s achievement (or absence of it) in coping with the problems it faces can determine the fortunes of other cryptocurrencies in the years ahead as the leading cryptocurrency at the moment.

Legal Aspects and Issues Associated with Crypto-Currencies

Virtual currencies, depending on the nation, have different legal elements to consider. Some nations classify them as cash and legal, some classify them as assets and legal, while some nations like India do not classify them as illegal or legal, without legal frameworks. Bitcoin is produced illegally in nations like Bangladesh and Russia. Its status is somewhat complex in other nations. Cryptocurrencies are prohibited in some nations due to existing legislation, such as Iceland. However, cryptocurrencies in India, like many other countries, currently have no legal framework in place and are unregulated. Cryptocurrencies related legal issues are as follows,

1. Decentralized nature: Unlike government-issued currencies (i.e. banknotes, coins, etc.) that are directly under the control of the issuing authority and derive their value from the promise of the issuing authority and stored gold, Cryptocurrencies are decentralized in nature, making it difficult for them to be regulated by the government.
2. Absence of a well-defined legal framework: Most nations lack an adequate legal framework to regulate the value and flow of virtual currencies both inside and outside the nation, creating additional hurdles to regulate a decentralized currency.
3. The volatility of Virtual Currencies: As can be seen from latest modifications in the value of most renowned cryptocurrency bitcoin, which in 2010 had a base value of $0.30 and in 2017 grew to nearly $4000, virtual currencies follow a volatile track of ups and downs that further bring market and economy instability.
4. Independent Wallets: Wallets holding cryptocurrencies and engaged in transactions are established and managed by private companies that have no control over any organization owing to the lack of any binding international laws in place. They, therefore, have no liability for the loss of the customer as well as for any form of financial crime committed by and through the use of these wallets. 
5. Taxation: Taxation issue is one of the major cryptocurrencies issues. Because of their pseudo-anonymity, if properly used, they can readily be used by hiding the property for tax evasion purposes. Cryptocurrencies are often categorized as a taxable asset, for example in the United States. While bringing big amounts of foreign currency into a nation may de-stabilize its economy and may cause taxation problems, it also presents financial market volatility. Online path to take and store cryptocurrencies makes it simpler to get them across border checkpoints, where they can be cashed out when they are inside the nation, efficiently avoiding border taxes. Loopholes current in some countries ‘ legal and tax scheme allow an individual to use cryptocurrencies features such as anonymity and lack of or outdated or improperly enforced cryptocurrencies schemes.
6. Money Laundering: Money laundering is typically taken into account when developing a country’s legal framework when discussing Cryptocurrency. But since its emergence, many countries are struggling through cryptocurrencies with problems related to money laundering. Due to the ease of their motion between nations with little or no oversight, money laundering is a main legal complication with such currencies. While organizations can monitor virtual currency purchased through banks, it becomes difficult when purchasing or selling the coins using money or other hard-to-trace techniques. Other safety provided in connection with trading in cryptocurrency are:

• Spoofing and Phishing Payment Information

Like ordinary e-money, phishing attacks also affect cryptocurrency users because they can be redirected to a fake website that requires them to enter their crypto-wallets user I d and passwords. While transaction spoofing may be performed by an attacker when a user attempts to copy the wallet address for a transaction that is replaced by malware and the user is unaware of the changes as not everyone is watchful to double-check a long address copied by them.

• Error in User Address

There is also a prospective loss danger when an error is made in the address of the recipient that can result in cash loss. For example, in the case of Ethereum, if some of the last digits of the recipient address are mistakenly entered, the money will disappear or be transferred to the exact address, but the intended value multiplied by 256 will be transacted.

• Loss of a Wallet File

One of the cryptocurrencies ‘ significant issues is the loss or theft of local wallet documents due to hard disk crashes or other interruptions. So, a paper wallet is usually recommended to store local passwords or a hardware wallet backup.

• Insecure ICOs

Investing in cryptocurrency-funding can be achieved via Initial Coin Offering (ICO) through virtual currencies. Generally, an ICO is awarded to increase a lump sum of money through the purchase and sale of cryptocurrency that needs an Internet connection. Another obstacle when managing virtual currencies is the lack of a risk-free access system to control the cryptocurrency market to track down and de-anonymize a payee on the cryptocurrency market.

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• Payment Gateway Hacking 

Hacking can be performed by convincing the hosting provider that they are the true domain owners and then the cash flows are intercepted. Many well-known financial services have fallen prey to hackers using such tactics.

• Fraud at the Trading Exchange

With Bitcoin’s popularity and latest price increase, many potential platforms for exchange and trading are flourishing around the globe. These trade exchanges store in their local servers the public and private keys of all the wallets of their clients. If any, a trading exchange supplier will decide to run away with the cryptocurrencies of all their customers. Then there is not much that can be done against such offences owing to the absence of legislation and legal frameworks, which in turn puts all traders in a fragile position.

Precautionary Measures and Initiatives by Regulatory Authorities and Government Agencies 

Virtual currencies ‘ legal status differs widely from nation to nation, and many of them are still undefined or undergoing modifications. While many nations do not illegalize the use of cryptocurrencies, their status as cash (or commodity) differs, with different legislative consequences. While some nations have explicitly permitted their use and trade, others have in any way limited or prohibited their use. Similarly, separate public organizations, departments, and courts differ on cryptocurrencies views. For instance, cryptocurrencies are unregulated in India, UK, Brazil, etc. because there is no legal framework yet in place, or their use has been deregulated and is free to use with no or minor legal constraints. While these are regulated in nations like France, Finland and Germany, use is legal but specifically regulated for tax or other purposes, and sometimes classified as cash. In some nations, the use of cryptocurrency is limited but legal in certain conditions, such as in China, people may be able to transact, while corporations and banks are unable to do so. It is illegal in Iceland to buy or sell bitcoins, but they can be mined. Nations like Russia, Bangladesh, and Ecuador have outright banned bitcoins. Recently CME Group Inc. in the U.S. has opened up a future exchange in bitcoins while SEBI, India has established a Financial and Regulatory Technology (CFRT) Committee to examine, deliberate and advise on cryptocurrencies issues. Reserve Bank of India also issued warnings about the volatile nature of cryptocurrencies to customers engaged in bitcoin trading. Below are some suggestions and precautions for cryptocurrency owners and crypto-investors,

• Always check the address of a Web wallet and prevent following suspect connections to a Web bank or Web wallet. 
• Always double-check the address of the recipient, the amount entered, details of the transaction fees and other charges before the transaction. 
• Recover expired account passwords and other details and maintain them secure and personal.
• Investment in cryptography is dangerous. Common procedures must, therefore, be followed while investing in unforeseen conditions such as diverse investment, provider reliability and a powerful mindset. 
• It is advisable to use cryptocurrency wallets and paper wallets. Use excellent antivirus programs to safeguard pcs and devices that are used to access crypto-wallets, as well as other cryptocurrencies operations.

Conclusion 

Most use of Virtual Currency worldwide is currently under a vacuum in terms of legality and controlled. Some nations have included it in their financial system, but some have totally prohibited it. If Virtual Currencies ‘ popularity rises further, it may be regulated by more and more nations, although it is not the case that many consider bans on it. With the increasing client base and the latest upsurge in the value of Bitcoin, which is one of the most popular virtual currency available, there are increasing hurdles such as the need for a legal framework and regulatory authority, awareness of wallet use, transaction processing as well as hazards associated with virtual currency transactions. Cryptocurrencies can, therefore, be said to have excellent potential for becoming a global currency. Even in nations where the courts prohibit its use, it is still a matter of restricting the use completely without internet censorship. Thus, it can be ascertained that the integration of Virtual Currencies into legal frameworks and the current financial system has enormous growth potential and advantages. Indian banking and finance are prepared to leverage transaction processing from the capacities of blockchain technology and distributed ledgers. There is likely to be more discussion about the legality and recognition of cryptocurrencies around digital currencies in the next few years. The key legal problems surrounding cryptocurrencies were discussed in this article and these are the primary concerns that nations need to consider when establishing Virtual Currencies legislation.

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This Article is written by Sonali Chauhan, a student of Lloyd Law College, Greater Noida. The author,  in this article, has discussed the legal maxim ‘de minis non curat lex’.

Introduction

An abbreviated form of the Latin Maxim de minimis non curat lex, “law is not concerned with small things.” A legal doctrine by which a court refuses to consider trifling things. The de minimis legal history dates back to the fifteenth century.

In a lawsuit, the de minimis doctrine is applied by a court to avoid resolving trivial matters that are not worthy of judicial scrutiny. Its application sometimes leads to an action being dismissed, especially when the only redress being sought is for a nominal sum, such as a dollar. When appropriate, the appellate courts also use the de minimis doctrine.

It is a principle of common law that stipulates that judges will not sit in judgment or take notice of extremely minor violations of the law. In accordance with this Maxim, rationale citizens would consider an appeal for trivial matters to be a complete waste of time and resources. It will bring disrepute to the judicial system.

A legal term which means too small to be meaningful or taken into account; immaterial. As a matter of policy, the law does not encourage parties to bring legal action where the impact of the breach is negligible for technical breaches of rules or agreements. De minimis exceptions are commonly included in contracts to limit the use of covenants or other restrictions so that they do not apply in circumstances where the failure to comply with the restriction has negligible impact. 

This maxim is also recognized by Section 95 of IPC

Illustration

• A promised B they’ll go watch a movie together on Sunday. A did not appear at the theaters, however, B suffered mental trauma and agony. B sued A for damages. The court will dismiss B’s appeal here because the law does not take into account trivial issues.
• X drives at a high speed along a dusty road and his motor wheels throw a little dust on Y, a pedestrian’s clothes. Here X, on the basis of the maxim de minimis non curat lex, is not liable for the tort as the matter is trivial in nature.
• X walks through the Y’s land for the first time, without Y’s consent, without causing any damage to Y’s land. If for once, it is a trivial matter, and the maxim would protect him, but if X repeats, over and over again, to establish his rights on the Y’s land, it will not remain a trivial matter, and it will become a tort, and the maxim will not protect X.

Case Reference

• In People v Durham, 915 NE 2d 40 (2009), Illinois Appellate Court Justice Robert Steigmann had Daniel Durham before him who did not like a traffic citation he had earned and sought $5 compensation:

“Litigation like this brings the judiciary into disrepute. Rational citizens (not connected with the law) would consider this appeal to be a complete waste of time and resources for all concerned. The time and money already spent on bringing this appeal amount to wasting resources. We will not be a part of further squandering.

“The maxim de minimis non curat lex retains force in Illinois and is wholly applicable in this case. This maxim applies even to constitutional claims, and its function is to place outside the scope of legal relief the sorts of injuries that are so small that they must be accepted as the price of living in society rather than make a federal case out of.”

• In the leading case of Coward v. Baddeley, 1859, A bystander touched a fireman on the arm to draw his attention to another part of a building in which a fire raged. On a suit filed for battery by the fireman, the court held that on the basis of maxim de minimis non curat lex, the by-stander was not liable for battery.
• In Helford v. Bailey (1849) 18 L.J.Q.B. 109, In a particular water body, the plaintiff has an exclusive right of fishing in the water. The defendant casts the net and pulls out the net from the water. The plaintiff filed it as a petition for trespassing. The plaintiff’s plea was that he had the exclusive right, and the defendant violated his right through trespassing and then fishing. There is no question whether or not he caught any fish. The defendant has thus created an act of tort against the plaintiff and, if repeated in the future, the defendant would tend to establish fishing rights. Court held the plaintiff’s view is correct, and although it was a trivial act, the court found it a tortious act and found the defendant guilty.
• In 2004, the maxim was also on center stage, Supreme Court of Canada decision in Canadian Foundation for Youth v. Attorney General where the late Justice B. Wilson, in dissent, explained:

“The Chief Justice is rightly unwilling to rely solely on prosecutorial discretion to wipe out cases that are undeserving of prosecution and punishment. Prosecutors ‘ good judgment in eliminating trivial cases is necessary, but not sufficient for the functioning of criminal law. Legal protection against convictions must be provided for conduct that is unworthy of punishment. The judicial system is not plagued by a multitude of insignificant  prosecutions of conduct that merely fulfill the technical requirements of “a crime” (e.g., theft of a penny) because prosecutorial discretion is effective and the common law defense of de minimis non curat lex (the law is not concerned with small or trifling matters) is available to judges.

“Applying some force to another does not always suggest a criminal assault. Quite the contrary, there are many examples of incidental touch that can not be considered criminal conduct.”

“De minimis non curat lex’s common-law concept was expressed in The” Reward”(1818):

‘In applying the statutes, the Court is not bound by a strictness at once harsh and pedantic. The law allows the qualification that the ancient maxim De minimis non curat lex implies. Where there are very slight irregularities, it does not intend that the penalties should be inflexibly severe. If the deviation was a mere trifle, which would weigh little or nothing on the public interest if it continued in practice, it could be properly overlooked’.

“De minimis ‘ defense does not mean the act is justified; it remains unlawful but it goes unpunished because of its triviality.

Generally, the justification for a de minimis excuse is that: (1) it reserves the right to apply criminal law to serious misconduct ; (2) it protects the accused from the stigma of a criminal conviction and the imposition of severe penalties for relatively trivial conduct ; and (3) it reserves the right of the courts to be swamped by a huge number of trivial cases. The theory is partly based on the notion that the evil to be prevented by the section on offense has not actually occurred. This is consistent with the dual basic principle of criminal justice that there is no culpability for harmless and blameless conduct.

“In Canadian jurisprudence, the defense of de minimis has been raised in drug cases involving a small amount of the drug, in theft cases in which the value of the stolen property is very low, or in assault cases in which there is extremely minor injury or no injury ….”

Section 95 IPC

Section 95 IPC is itself based on the maxim de minimis non curat lex (the law does not take trifles into account). This section is intended to prevent the punishment of negligible mistakes or trivial offenses. Whether the act, which amounts to an offense, is trivial would undoubtedly depend on the nature of the injury, the party’s position, the knowledge or intention with which an offending act is performed, and other related circumstances. Under this provision, these cases are considered innocent by the public, even though they fall within the letter of the penal law, not yet within its spirit, or throughout the world. In other words, the harm resulting from an offense if it is so small and trivial that no person of ordinary sense and temper would complain about such a harm.

De minimis non curat lex in India

In cases of copyright infringement, the de minimis non curat lex principle can be used as a defense in India. The important issue is whether the de minimis principle could be used in accordance with section 52 of the Indian Copyright Act as a separate defense rather than fair use. In India Tv Independent News Service Pvt. Ltd. and Ors. v. Yashraj Films Pvt. Ltd., the court discussed at length the principle of the applicability of de minimis. Before this case, the position regarding the applicability was not very clear. The facts of the case were that from a song of five stanzas five words were copied. After applying the five well-known factors commonly considered by courts in the de minimis application, the court concluded that the offense is trivial and attracts the de minimis defense.

The Supreme Court in Smt. Somawanti v. State of Punjab (AIR 1963 SC 151) observed that “they are not intended to be repeated by others or used in such a way that a book can be used, but the de minimis non curat lex principle still applies to a supposed wrong in taking part in dramatic works as well as in reproducing a part of a book.”

A principle of common law that disregards very minor transgressions of the law. For example, a description must be false “to a material degree” in order to constitute an offense under the Consumer Information Act 1978.

Case Reference

•  State (Delhi Administration) v. Puran Mal, A.I.R. 1985 S.C. 741.

In consideration of this Latin legal maxim, the court examined the adulteration of food articles and argued that a food item unfit for human consumption can not be considered to be covered by the de minimis non curat lex rule.

• State of Bihar and Ors v. Harihar Prasad Debuka and Ors., A.I.R. 1989 S.C. 1119.

Checking documents or filling in and submitting forms and returns, detouring to a public weighbridge and the like can be an inconvenience and the court can apply the maxim ‘ de minimis non curat lex ‘ unless it is shown to be unreasonable and not in the public interest.

• Chunilal Jethalal v. Ahmedabad Borough Municipality, LQ 1939 HC 0544.

The learned judge rightly held that the words “kept for use within the borough” meant that they were kept for normal use within the borough, and no doubt where a vehicle is kept outside the borough for normal use, an occasional user within the borough could be rejected on the basis of the principle of de minimis non curat lex.

Conclusion

The maxim suggests that to avoid costly litigation, technicalities must yield to practical common sense and justice. De minimis defenses are an understudied aspect of the law, appearing more frequently in legal practice than in legal theory but rarely gaining in either type of extensive analysis. This has led to an unfortunate state of affairs where one term is applied to a set of practices that, at best, are only loosely linked.

This is a hypothetical case that will allow examining the concept of de minimus non curat lex. It will also show that this is an equitable remedy and that it is still in a flux state. Usually, it is used to avoid further litigation and further review of appeals. It is a fair remedy in which the trial judge has complete and absolute control, as well as discretion over its use and application. However, there appear to be no specific terms for its application other than the individual judge’s subjective opinions.

Not all courts agree when and how the doctrine should be applied. Before making a decision to apply “de minimis,” the courts consider the wrong and the amount of harm involved. The maxim is said to be a pure “exercise of judicial power and nothing else.”  (State v. Park), 525 P2d 586 (Haw. 1974)

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This article is written by Nancy Patel, pursuing a Certificate Course in Arbitration: Strategy, Procedure and Drafting from Lawsikho.com. Here she discusses “What to do if Arbitration is not Working Properly”.

Arbitration is only as good as the arbitrators[1]

An effective arbitration process revolves around the chosen Arbitrator. An Arbitrator must be independent, neutral and impartial. Arbitration is a quasi-judicial process; it has to adhere to the laws of the State, chosen institution and principles of natural justice. The UNICITRAL Model Law, Arbitration and Conciliation Act, 1996 amended in 2015 (The Amendment Act)[2] ensure that the entire Arbitral exercise is based on fair play and equity. 

Ensuring Arbitrator’s Independence and Impartiality

The Indian Arbitration and Conciliation Act is modelled on the UNCITRAL Model Laws. The Arbitration and Conciliation (Amendment) Act, 2015 provides the following steps for securing unbiased and impartial Arbitrator which is discussed as under: 

A. Section 11: Normally, Arbitrator is to declare any conflict of interest that would suggest the existence of bias under section 11 of the Act

B. Section 12: Disclosure Statement

An Arbitrator must give disclose the fact if he has any relationship whether past or present, direct or indirect either with the parties or the subject matter in dispute. The VI Schedule annexed to the Arbitration and Conciliation Act, 2015 amendment provides a prescribed form for such disclosure.

C. Section 13: Mode of challenging an Arbitrator  

A challenge can be made by submitting a statement which shows reasons why the party is challenging an Arbitrator within 15 days of the constitution of Arbitral Tribunal. 

D. Section 14: An Arbitrator who becomes de jure or de facto unable to perform his duties can be terminated by the court. 

E. Fifth and Seventh Schedule:  These schedules are based on the international recognized list under International Bar Association that is Green list, Orange List and Red list. The Fifth schedule enumerates the circumstance which could raise doubt about the independence and impartiality of arbitrator due to his relation with the disputant parties, his interest in the dispute, his relation with other arbitrator if there is a panel of three arbitrators and seventh schedule and 7th Schedule contains those grounds which make the Arbitrator ipso facto ineligible to act as an arbitrator, irrespective of agreement between the parties.[3]

Judicial Trend on Conflict of Interest of the Arbitrator

A number of cases are analysed to bring out the contours of section 11, 12,13,14 of the Amended Act read with the schedules annexed to Arbitration and Conciliation Act, 1996 amended in 2015 to understand the legislative mandate on the independence and impartiality of an Arbitrator.

In HRD Corporation Limited,[4] the Supreme Court propounded that if the arbitrator has passed an Award in earlier arbitration between the same parties about the same dispute that does not mean it is justifiable grounds for challenging impartiality as per the fifth schedule,  

The Delhi High Court in D.K. Gupta[5] allowed the unilateral appointment of an arbitrator by one of the parties’ representatives, who was the contractually agreed appointing authority (and not the mandated arbitrator himself). The decision of the Delhi High Court brings to light an unresolved issue which the Amendment Act failed to address, i.e. unilateral appointment of tribunals by one of the parties to the dispute.  

Voestalpine Schienen GMBH v Delhi Metro Rail Corporation Ltd.,[6] the Hon’ble Supreme Court held that amended Act does not bar the appointment of retired officers of any government department, public sector undertaking, and statutory corporation as arbitrators. They must not be related to the government body or disputant part. It should include people from a legal background. 

Reliance Infrastructure Limited Vs. Haryana Power Generation Corporation[7] the Punjab and Haryana High Court held a former employee or consultant or advisor is not included in the Entry 1. Hence, they are not de jure ineligible to be appointed as an arbitrator.

Afcons Infrastructure Limited V. Ircon International Limited,[8] the  Delhi High Court removed the existing panel of retired railway officer and appointed an arbitral panel which was broad-based to work as Railway Arbitrator. Merely appointing ex-employee as an arbitration does not fall within the purview of section 12(5) read with 7th schedule, it gives rise to apprehension in the minds of parties that he may be biased. 

In TRF Ltd. v. Energo Engineering Projects Ltd,[9] the Supreme Court held that nomination by ineligible arbitration is not allowed as it would amount to arbitrating by a proxy. 

In Aravalli Power Company Ltd. v. Era Infra Engineering Ltd.,[10] the Supreme Court held that the employee named as an arbitrator in the arbitration clause should be given effect to if there is no apprehension about his independence and impartiality.

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In Bharat Broadband Network Limited,[11] the Supreme Court has interpreted section 12 and other provisions of the amended Arbitration Act along with three landmark judgments. The ratio can be summarised as under:

1. An arbitrator should give honest disclosure as per the sixth schedule.
2. If there are circumstances that raise a justifiable doubt then it can be ground to challenge his/her appointment. The first opportunity is given to the Arbitral Tribunal to adjudicate the challenge and if there is no substance in the challenge, the tribunal will continue with the proceeding and pass Award.  
3. Section 34 can be used to set aside Award if one of the party does not have faith in the Arbitrator or they had unsuccessfully challenged the appointment of Arbitrator. However there is an exception, the parties to the Arbitration can waive such provision by entering into an express agreement in writing.

• The Supreme Court also held that section 12(5) must be contrasted with Section 4 of the Act only if express agreement in the wiring between the parties is made after dispute having arisen between them.

Lacuna in the Amendment Act   

Section 13(3) is the dignified way of showing the Arbitrator the door, but if Arbitrator refuses to withdraw and chooses to adjudicate the challenge to Arbitral mandate it will amount to a judge sitting in his own judgment which is against the basic tenets of the law. If an Arbitrator has an ulterior motive, he/she may not adjudge the challenge fairly and continue to be Arbitrate till the end of the proceedings. In such a scenario, the aggrieved party will have to continue to wait for the entire duration of the arbitral process.  The resultant effect will be loss of valuable time because now the aggrieved party has already made up mind to file for setting aside of Award pass by the Arbitrator. By allowing such an Arbitrator to continue with the proceeding, the provision is actually empowering him to continue with the Arbitral proceedings.

Under the UNCITRAL Model Laws, there is an in-built safeguard in the form of Article 6 in case of unfair proceeding as it provides that biased arbitrator can be challenged before the competent Court or the authority. The Indian Arbitration and Conciliation Act 1996, amended in 2015 and now Amendment in 2019 does not provide inbuilt safeguards. The latest amendment does provide provision regarding qualification and bias so as to ensure that the faith in the Arbitration process continues in India. If this aspect regarding the impartiality, neutrality and independence is adequately addressed, it will make India an Arbitral hub which was the very intention of the legislature. 

 The old Arbitration Act, 1940 had an inbuilt safeguard as the aggrieved party could approach the court in India and remove an arbitrator suffering from probable bias at the earliest. 

Conclusion

The latest 2019 amendment to the Indian Arbitration and Conciliation Act has laid down the general norms applicable for the appointment of Arbitration such as impartiality, neutrality, absence of financial relations that might affect the impartiality or create an appearance of bias among the parties. Moreover, the Arbitrator must be conversant with the constitution of India, natural justice, equity, justice, commercial law, international legal system, and international best practice and pass a speaking award to create transparency in the proceedings and ensure impartiality, neutrality and independence of Arbitrator, thus reinforcing the reliability of Arbitration process in India. 

References

1. Lalive, ‘Mélanges en l’honneur de Nicolas Valticos’ in Droit et Justice (1989), 289
2. The Indian Arbitration & Conciliation Act is the only arbitration statute in the world to have adopted the lists contained in the IBA Guidelines on Conflicts of Interest in International Arbitration. It contains a recommendation of the report of the 246th Law Commission of India. 
3. The list contains a situation which violates principles of natural justice. In such cases, neither disclosure nor previous agreement between the parties will sufficiently cure such circumstance and no party will be given autonomy in case of violation of principles of natural justice. 
4. CIVIL APPEAL NO. 11126 OF 2017 https://indiankanoon.org/doc/64807864/
5. D.K. Gupta & Anr. v. Renu Munjal, 2017 SCC OnLine Del 12385
6. 2017 SCC OnLine SC 172
7. Arbitration Case No. 166 of 2016 (O&M), decided on 27 October 2016 (High Court of Punjab and Haryana)
8. ARB.P. 21/2017, decided on May 29, 2017 (High Court of Delhi)] accessed from https://indiankanoon.org/doc/121425092/ on 5th September 2019
9. 2017 (8) SCC 377
10. Civil Appeal No. 12627-12628 OF 2017 (SPECIAL LEAVE PETITION (CIVIL) NOS.25206-25207 OF 2016)
11. Civil Appeal No.3972 of 2019 and https://barandbench.com/bbnl-judgment-on-the-impartiality-and-independence-of-arbitrators/ accessed on 4th September 2019

Students of Lawsikho courses regularly produce writing assignments and work on practical exercises as a part of their coursework and develop themselves in real-life practical skill.

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Find out the AIBE XVIII question Paper solutions. Map and Mark your practise for coming AIBE papers by solving past year papers. 

To know more about types of Intellectual Property Rights for purpose of AIBE preparation, please Click Here.

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This article is written by Ramanuj Mukherjee, CEO, LawSikho.

A few years back, a student who was undergoing a course on criminal law, called me up and screamed at me. She was a practicing matrimonial lawyer in Bangalore with experience of 20 years or so.  She was allocated a topic to write on, and she didn’t like it at all.

From what I remember, it was something about how blogging can help lawyers to get more clients. She was really upset about the topic, which she was asked to write on as a part of the career development module. 

She was furious and told me that the topic itself showed that we are immature people and have no clue about how the legal profession works.

I tried to convince her that the time is changing and it’s online first in all industries, including in law. Everyone goes online and googles their problems, and if they see your content and come to trust it, they will also trust you and respect you for the same. 

One can build up tremendous credibility online. Well, I couldn’t convince her. She asked me for a refund, which I refused and she stopped participating in the course. That was the end of it, unfortunately.

I was reminded of that incident this morning when I read about how Lilly Singh, a bisexual Indian origin woman, has become the first woman of color to break into the club of late-night show hosts on NBC. It is a great achievement. However, she has no background in media as such.

Where did she come from? Hollywood Reporter called her the freshest face on TV shows. 

Lilly Singh started a YouTube channel 10 years back and made videos that went viral one after the other. Her videos are entertaining and on topics like what would it be like if the Game of Thrones was made in India and Shit White People Say to Me in LA.

Click Above

Anyway, Lilly Singh’s story goes a long way to show how online content is shaping traditional media in today’s world. Do you think that law is different?

I assure you it is not. Ask the lawyer who has amassed half a million followers on TikTok. 

Here is the thing: the internet has changed the economics of brand, reach, and credibility. Brands are being made and destroyed on the internet every minute. The pace is unthinkable for lawyers from older generations who are not familiar with this world. 

Lawyers with massive online following will be the reality of the future. Those lawyers will also automatically command attention from mainstream media and will find clients far more easily thanks to their online stardom. 

Legal practices will be built online, clients will be found online, mainstream legal establishment will embrace online legal influencers and work on their online presence. It’s already in motion, but the next ten years will change the face of legal industry.

How could you ride this wave?

Yesterday I took a session for the learners in our Legal Practice Development and  Management course. With me there was Nipun Bhatia from Legal League Consulting, and we discussed how lawyers can attract more clients by building a stronger brand.

I have created are some of the exercises for them. Would you like to get access to some of these questions?

Take out some time and work on them.

Question 1: What work have I done that gave me the highest margin in the last 1-3 years? Write down the top 3. 

Instructions: Be very specific. For example, do not write doing legal work for startups. Write down specific details, such as Drafting and Negotiating Series A SHA on the sell-side. Or recovering money through MSMED proceedings.  Or obtaining a settlement for alimony in a contentious divorce case. Being specific goes a long way to narrow down a target group and will help you to have a laser-sharp focus for your branding efforts.

1.

2.

3.

Most lawyers are scared to specialize narrowly. They think that a broad specialization is better. This is absolutely not correct! You specialize narrowly in one thing because you become the number one or at least one of the well known noticeable lawyers more easily in a narrow domain. You can then go on to add more domains. But trying to make your mark in everything right from the beginning means you spread yourself too thin to make a mark at all. You make your own task harder by having a wider focus.

This is why while we are identifying 3 different things as high margin work, we would still like you to focus on just one to start with unless you have a big enough team to work with. If you have a team of at least 3-4 in place, you could start with 3 right from the beginning.

Question 2: What are the networks that I am already part of? What are the high margin legal problems they have that are not solved well? Fill in the table below.

Question 3: How can I regularly keep in touch with my important networks without spending a lot of time, leveraging technology, and benefit them on a regular basis? Take some time to think about the following questions.

Online events I can organise:

Platforms where I can contribute articles and videos:

Social media platforms where I can regularly share useful content and insights: 

What kind of content I can easily create and post on a regular basis:

Can I create newsletters or information forums for any of your target audiences: 

What is the kind of content that I can easily and naturally create: 

What would be my modus operandi to build and engage an audience that may need my services from time to time:

One of my icons, Gary Vaynerchuck, says that all businesses in the new century are media businesses. Either you own attention through your own media, or you pay someone else to access their media in the form of ads.

Unless you have an audience that is interested in your content, you will have to rely on someone else to find clients in the future. This already happens in the USA, where most lawyers have to advertise aggressively to find clients.

How will things look ten years down the line in India?

I look forward to hearing your thoughts on this.

Here are the courses in which we are currently taking enrollments: 

Diploma 

Diploma in Companies Act, Corporate Governance and SEBI Regulations

Executive Certificate Courses

Certificate Course in Real Estate Laws 

Certificate Course in Arbitration: Strategy, Procedure and Drafting 

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Certificate Course in Media and Entertainment Law: Contracts, Licensing and Regulations 

Certificate Course in Legal Practice Development and Management 

Test Preparation

Judgment Writing and Drafting Course for Judicial Services 

Dream Job Bootcamp

LawSikho has created a telegram group for exchanging legal knowledge, referrals and various opportunities. You can click on this link and join:

https://t.me/joinchat/J_0YrBa4IBSHdpuTfQO_sA

Follow us on Instagram and subscribe to our YouTube channel for more amazing legal content. 

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This article is written by Bhavna Hemajani, pursuing a Diploma in M&A, Institutional Finance and Investment Laws (PE and VC transactions) from Lawsikho.com. Here he discusses “Why do Companies have Multiple Funding Rounds?”.

Introduction

Startup: The Ministry of Commerce & industry vide notification dated February 19, 2019, has amended the definition of a Startup. It states: 

Only that an entity will be called a Startup, whether it is incorporated as a private limited company, a limited liability partnership or a registered partnership up to 10 years of its incorporation; turnover has not exceeded Rs. 100 crore in any of the previous financial years; it is working towards either innovation, development or improvement of goods/ processes/ services or if it has a nature of a scalable business model, it works towards employment generation or wealth creation. It does not include that entity which is a result of splitting off or reconstruction of an existing business. 

Funding for Startup

For any Startup to stay afloat and grow it will require funding, either from an external or internal source. In a narrow sense, the term ‘fund’ signifies ‘capital’.[1] Funding is the fuel on which a business operates. The internal source of funding includes self-financing and financing from family and friends. While the external source of funding includes investors. For the investors, it is a risky proposition but investing in Startups requires low capital input which when combined with high upside potential, makes it lucrative and attractive for the investors to put their bets on Startup.[2] 

A Startup shall raise its funds in multiple rounds. These multiple rounds are the following:

1. Seed capital/ Angel investor funding
2. Series A/B/C- Venture capital financing
3. Mezzanine Financing & Bridge Loans
4. IPO[3]

Seed Capital

Even before a Startup decides to enter the first phase of funding, it may indulge in pre-seed funding round. The pre-seed funding involves funds being raised by the founders and friends & family members. Once some operation has commenced, a Startup may raise a seed capital funding, which is also called Series rounds. Usually, it is the angel investors that seek to invest in Startups at this stage. 

The SEBI (Alternative Investment Funds) Regulations, 2018 defines an angel investor u/s 19A(2). Angel investor may invest in or fund those Startups where it will see a potential for growth. Currently, there are various groups and individuals who have identified themselves as angel investors and their efforts are resulting in various success stories. The Indian Angel Network is a network of angel investors who invest in early stages businesses having the potential to create disproportionate value. The members of the Network are leaders in the Entrepreneurial Eco-System as they have had strong operational experience as CEOs or a background of creating new and successful ventures.[4] The AngelList, an US-based curated closed marketplace for startups and investors, has launched an India focused fund – The Collective. The Collective will invest about INR 1 Cr each in 60-80 startups annually. This fund will also give quick capital access to AngelList’s Syndicate leads.[5]

Startup India Initiative was launched by the Modi Government in January 2016 to provide support to entrepreneurs and ensure sustainable economic growth in India. Under the initiative, one of the key pillars of support to Startups is ‘Exemption on Income Tax & Capital Gains Tax for all eligible startups’. The Startups are exempted from tax liability imposed u/s 56 (2)(viiib) of Income Tax Act i.e. on considerations received for issue of shares that exceed the face value of such shares.[6] This provision is called the Angel Tax exemption provision. 

Series A/B/C Funding

It is a common phenomenon that most of the Startups face is that they fail after their seed round. But if a business manages to pick up operations in a positive manner, it shall become eligible to enter into the next phase of funding. Series A funding usually comes from venture capital firms, although angel investors may also be involved. 

With limited operating history and high risk involved, Startup does not seek to raise funds from institutions. The Venture capitalist in exchange for the high risk by way investing in smaller and less mature companies, they receive certain protective rights in the company with respect to management decisions, in addition to a significant portion of the company’s ownership (and consequently value).[7] Since the high per cent of venture capital investors is from outside India, their investment activities are regulated by the SEBI (Foreign Venture Capital Investors) Regulations, 2000. 

It has been stated that investors particularly venture capitalist (VCs) add value to Startups in various ways, namely: 

1. Ensure smooth operations by the leading company board. 
2. Provide assistance in recruiting high-quality human resources for the job. 
3. Provide aid in achieving efficiency and effectiveness.[8]

Equity crowdfunding has also become one of the sources for Series round of funding. It refers to raising funds, particularly at an early stage, by offering equity interests in the business to investors on an online platform. Businesses seeking to raise capital through this mode typically advertise online through a crowdfunding platform website, which serves as an intermediary between investors and the start-up companies. Some examples of equity crowdfunding platforms are Syndicate Room, Crowdcube and Seedrs.[9] However, SEBI considers it to be as ‘unauthorised, unregulated and illegal’. 

Mezzanine Financing & Bridge Loans

A Startup seeking to expand will require mezzanine or bridge funding. Mezzanine finance is a collective term for hybrid forms of finance: it has features of both debt and equity. The most common forms of mezzanine finance include

1. subordinated loan; 
2. participating loan; 
3. ‘silent’ participation; 
4. profit participation and
5.  convertible bonds. 

Mezzanine financing is a preferred option over equity holders. Consequently, mezzanine investments generate returns that are higher than traditional bank lending rates and lower than the returns required by most equity investors.[10] Thus, one can say that mezzanine financing acts as a catalyst in the growth and development of the Startup. 

Bridge financing is undertaken by the Startup to bridge the gap between investments where the Startup is trying to keep the company afloat. It is a round of funding involving taking short term loan in order to reach the next round of funding.[11] Bridge financing allows Startup to merge, or gather financing for an IPO.

 Click Above

Initial Public Offering (IPO)

SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2018 defines IPO as ‘an offer of specified securities by an unlisted issuer to the public for subscription and includes an offer for sale of specified securities to the public by any existing holders of such specified securities in an unlisted issuer.’[12]

SEBI recently amended the regulations on Issue of Capital and Disclosure Requirements and expanded the scope for companies to can list their securities. A company involved intensively, in providing products or services or having substantial value addition in relation to use of technology, IT, IP, data analytics, biotechnology is also eligible to list their securities on Innovators Growth Platform.[13] With this amendment, SEBI seeks to attract more and more investors and boost the growth of Startups. 

Case Study: Flipkart

Flipkart is the ideal Indian Startup success story. It is to be noted that though it does not fall within the scope of the current definition of Startup, it started as one. It started its operations with Rs. 4 lakh as initial capital in 2007. In 2009, Accel India, the venture capital firm invested $1 million which marked the Series A stage of funding. Finally, after various rounds of fundings, it was in 2010-2011 when Flipkart became a Unicorn Startup[14] with valuation at USD 1 Billion. Now, as India’s leading e-commerce major, it has undertaken to support the ecosystem to build innovative solutions for the next wave of internet users with the launch of a venture fund.[15]

Conclusion

Every entrepreneur seeks to develop a business plan that caters to the need of the masses and the means to serve this identified need is a Startup. It can be a company or a partnership. But every business requires some capital funding to stay afloat, operate and grow in future. Funding of any Startup is undertaken in different stages to serve the current need and the immediate future growth plan. At each stage, there are different categories of investors. Each investor can be distinguished from the other on the basis of their nature, the risk undertaken by them and the scale of funding they put. The Indian scenario is booming with successful Startup stories e.g. Flipkart, Oyo Rooms, Byjus, Swiggy etc. The statutory authorities have also recognised the growing trend along with the difficulty faced by the Startups in raising funds. Therefore, the Modi government launched the scheme called Startup India, as a platform for investors and startups to connect and achieve their respective goals. 

References

1. 1. Black’s law dictionary 
   2. Ibid.
   3. Upwork, 5 Stages of Startup Funding https://www.upwork.com/hiring/for-clients/5-stages-startup-funding/
   4. Indian Angel Network, About Retrieved from https://www.indianangelnetwork.com/about.
   5. Yatti Soni, AngelList Launches An India Fund Backed By Flipkart’s Binny Bansal & More, Inc42 Retrieved from https://inc42.com/buzz/silicon-valley-based-angellist-launches-a-fund-for-indian-startups/.  
   6. Notification No. 13/2019/F dated 5th March 2019, Ministry of Finance
   7. Nishith Desai Associates, Startups and Venture Capital Investments 
   8. FAQs Startupindia Retrieved from https://www.startupindia.gov.in/content/sih/en/about_us/faqs.html. 
   9. SEBI, Consultation Paper on Crowdfunding in India
   10. European Commission, Mezzanine Finance Final Report
   11. Upcounsel, Bridge Financing: Everything You Need to Know Retrieved from https://www.upcounsel.com/bridge-financing
   12. SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2018 § 2(w). 
   13. SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2018 §283(1).
   14. Term coined by Ms. Aileen Lee in 2013. The term is used to describe a Startup company with a valuation of USD 1 Billion.
   15. Thimmaya Poojary, Yourstory, Flipkart launches venture fund to invest in early-stage start-ups Retrieved from https://yourstory.com/2019/03/flipkart-venture-fund-invest-early-stage-startup-bnt5qqmfni.

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This article has been written by Lubhanshi Rai.

Introduction

With the development of the banking sector, malpractices of intentionally causing ‘cheque’[1] bounce have become rampant, therefore need to address the same was felt. In consequence, Chapter XVII, bearing title “of Penalties In Case of Dishonor of Certain Cheques for Insufficiency of Funds in the Accounts” was added[2] to the Negotiable Instrument Act, with which the issue has become the wide subject of litigation also. Defining the parameters of Section 138 in accordance with the legislative intent has been the matter of deliberation in the court. The issue has, therefore, time and again arose that “Does the ‘dishonour of cheque’ caused due to any other reason not specified in the provision, attract penal consequences prescribed therein”. 

Section 138 – Dishonor of Cheque for Insufficiency, etc., of Funds in the Account

1. A (Drawer) has drawn a cheque with a banker, on an account maintained by the him
2. The said cheque has been drawn in order to make the payment to B (Payee) so as to discharge the ‘debt’ or ‘other liability, either in whole or in part
3. B presents the said cheque with the bank which gets returned unpaid by the banker of A i.e. Bank refuses to obey the command of A to make the aforesaid payment to B, due to either of the following reasons-
4. Balance in such account maintained by A is insufficient to pay the amount mentioned in the cheque, or
5. The amount got to be arranged by virtue of an agreement between such bank and A, is insufficient to pay the amount mentioned in the cheque. 
6. Such a situation caused by A shall constitute an offence.

Provided- 

1. B had presented the cheque within 3 months from the date of its drawal or within its validity period whichever is earlier
2. B within 30 days of receipt of the information of non-payment, serves a legal notice upon A to make the payment good of amount mentioned in the cheque, within 15 days.
3. A fails to make the payment of the said amount within 15 days of the receipt of aforesaid notice.

Click Here

Analysis 

The issue is one which directly poses a conflict between the ‘strict interpretation’ of the provision and ‘purposive interpretation’ i.e. giving effect to the legislative intent. Although, the conflict certainly is not resed Integra, rather position is very settled in this regard that if the language employed in the provision is liable to be interpreted in a manner which would go against what was intended by the legislature at the time of enactment of the provision in question, then ‘purposive interpretation’ shall prevail over the ‘strict interpretation’. 

Let’s first proceed with the strict interpretation, i.e. to take into consideration only two aforesaid grounds in point 3 as the exhaustive list, whereto the penal provision of 138 can be attracted, that means no other third reason can be read as the ground for the purpose of dishonour u/s 138. The legal consequence of same would be such to give license to the people for employing other unfair means to cause the cheque to be dishonoured, so as to ensure that none of the aforesaid two reasons turns out to be claimed in the ‘cheque return memo’[3]. Such other reason stated in the return memo could be ‘Refer to Drawer’, ‘Account Closed’, ‘Payment Stopped by the Drawer’, ‘Amount in Words and Figure Differ’ etc., wherein even if cheque was deliberately caused to be returned unpaid, the drawer won’t be liable under the provision.  So even if initially, the de facto reason was ‘insufficient funds’ only, but the same was hidden under the veil of any third reason not laid down as a ground specifically under the provision, the penal provision won’t be attracted. 

The above-explained situation would have never been appreciated by the legislature and the strict interpretation would certainly defeat the very objective of the addition of chapter XVII to the Act. The position held by Gujrat[4], Madras[5], and Bombay High Court[6] in respect of the present issue, states that endorsement by the bank in return memo is not conclusive in itself, rather if the payee, the complainant is able to refer such endorsement ultimately to either of two specified grounds, then such third reason (endorsement) is equally liable to attract the penal provision. And how it’s to be held “ultimately referable”, is purely a question to be decided on the perusal of complete evidence adduced by the complainant. Evidence could be the records of the drawer’s bank account or an employee of the bank, etc. The purpose would be to establish that the drawer wrongfully with the dishonest intention caused the cheque to be dishonoured to avoid his liability and at the relevant time when the cheque was presented, there did not exist any sufficient amount in the bank account of the accused to honour the payment of amount mentioned in the cheque, regardless of any third reason stated in the return memo. The best illustration to explain the situation would be that the bank many times in order to save the reputation of its customer, does not endorse the actual reason of “insufficient funds” in the return memo, but endorses otherwise, however the same cannot be avoided at trial in the court of law. 

Further considering the title given to section 138, which states as “Dishonor of Cheque for Insufficiency, etc., of Funds in the Account”, wherein the word “Etc” has to have significance respecting the issue in discussion, as it was undoubtedly inculcated on purpose to make the provision inclusive of such other reasons also, which have not been laid down in the section itself. And neither, it can be said to have been possible for the legislature to lay down the exhaustive list of reasons at the time of enactment, as a human mind is very fertile, which keeps evolving the new ways to accomplish the goal, so apparently bearing the psychology, legislature in its best wisdom laid down the widely used method directly of “insufficient funds” as one of the possible reasons, in continuation of which the word “etc.” warrants the inclusive wide interpretation. 

The aforesaid interpretation of “etc”, is to be understood along with the meaning of “Dishonor” u/s 138, which has not been defined in the Act. As per the Black’s Law Dictionary, it simply means “to refuse to accept or pay a draft or to pay a promissory note when duly presented”. Therefore, the fact that the cheque was incapable of being encashed or payment could not be obtained, is itself conclusive to fetch the penal provision into the picture, so long dishonest intention of the drawer existed, and it would be therefore extraneous to trace the reason as essential condition behind such dishonour.

The purposive interpretation is further supported by the statutory mandate of serving notice on the drawer after dishonour of cheque, thereby giving the last opportunity to the drawer to make the payment good of amount mentioned in the cheque, within 15 days of receipt of the notice by the drawer. The mandate of final opportunity has been incorporated under the provision bearing in mind the bonafide mistake(s) that might arise while filling in the cheque, and consequently the same might not get encashed, and therefore it’s the duty of the drawer to prove his bonafide(s) within 15 days by making the payment, the failure of which necessarily implies that the drawer had mala fide intention since the beginning and never intended to discharge the liability in question. In such a situation it becomes imperative to presume that drawer did not have sufficient amount to honour the payment, as had the funds been really available with him and had he have the intention to discharge the liability, he would have made the payment on the last provided opportunity by rectifying his bonafide mistake(s). 

Conclusion 

In light of the settled law of the land, legislative intent has to prevail over the contradictory language employed by the legislature. In this respect, the statement made by Lord Denning L.J. deserves the appreciation, which states-

“It would certainly save the judge’s trouble if the Acts of Parliament were drafted with divine prescience and perfect clarity. In the absence of it, when a defect appears, a judge cannot simply fold his hands and blame the draftsman”[7]

In the very recent ruling of the Supreme Court, wherein it was pleased to remand the matter back to the trial court for adjudication u/s 138, thereby setting aside ruling of Madhya Pradesh High Court, who u/s 482 of CrPC[8], had quashed the complaint made u/s 138 on one of the grounds of remark noted in the return memo. Hence as on date, the legal position is no more res Integra and the penal consequences of section 138 are liable to be attracted in every case where the cheque has been returned unpaid and drawer deliberately fails in making the payment within 15 days of receipt of the statutory notice.

Endnotes

[1] The Negotiable Instrument Act 1881, s 6.

[2] The Banking, Public Financial Institutions and Negotiable Instruments Laws (Amendment) Act, 66 of 1988, (w.e.f. 01.04.1989), s 4.

[3] “Cheque Return Memo” is a statement made by the bank wherein it communicates the reason as to dishonor of cheque. `

[4] Dada Silk Mills And Ors. vs Indian Overseas Bank And Anr. 1994 CriLJ 2874.

[5] J. Veeraraghavan vs Lalith Kumar  1995 83 CompCas 853 Mad

[6] Rakesh Nemkumar Porwal vs Narayan Dhondu Joglekar 1994 (3) BomCR 355

[7]  Seaford Court Estates Ltd. v. Asher [1949] 2 All ER 155 (CA) (at page 164)

[8] The Code of Criminal Procedure 1973 (2 of 1974)

Click Here to read more about Dishonor of Cheque.

To know about Dos and Don’ts in a cheque bounce case Click Here 

The post Section 138 of The Negotiable Instruments Act: Do all the possible reasons for dishonor of cheque attract penal consequences prescribed under the provision appeared first on iPleaders.

This article is written by Khushnum Motafram, pursuing a Diploma in M&A, Institutional Finance and Investment Laws (PE and VC transactions) from Lawsikho.com.  Here she discusses “Can Foreign Companies Acquire Properties in India by way of Asset Sale?”.

Introduction

In the modern era of cut-throat competition, it has become imperative for corporate houses to opt for one or the other mode of corporate restructuring in order to operate and expand in the market. Not only does it help in business expansion, but it also plays a major role in the diversification of risk. Corporate restructuring refers to a process of significantly changing a company’s business model, management team or financial structure to address various challenges and increase shareholders value. These corporate houses incline to the phenomenon of corporate restructuring for various reasons viz. reduction of risk, increase in operational efficiency, improved access to the financial market, tax benefits, synergy benefits, revival of the sick company etc.  

Asset Sale is one of the modes of corporate restructuring. In general, asset sale means the itemized sale of assets of one company by the other company based on the individually assigned value to each of such asset. The asset sale is preferred by the majority of companies as it allows such companies to cherry-pick the assets and liabilities they want to transfer to their business. This form of corporate restructuring helps the companies to diversify their business in the desired direction without having to spend an extra bit for the entire load of the other company by allowing them to purchase only those assets and liabilities that would help them built a stronghold in their business sector. One major reason for the companies to opt for asset sale is to clean up their balance sheets encumbered with huge loans. An asset purchase is also known as price meal sale of the assets.   

Given the benefits of corporate restructuring through an asset sale, not only are Indian companies involved in the asset sale transaction, but foreign companies are also showing a keen interest in acquiring immovable properties in India in order to establish their operations here to unfold and exploit the resources and huge potential which our country offers. However, such asset purchase and sale transactions in India by foreign companies are governed and regulated by the strict provisions made under the Foreign Exchange Management Act, 1999. It is only in compliance with the provisions laid down by the Foreign Exchange Management Act, 1999, when a foreign company can purchase and hold immovable properties in India.    

RBI Master Directions

The Reserve Bank of India (“RBI”) is involved in all the cases where foreign entities are involved, be it, Non-resident Indian, Overseas Citizen of India or Person resident outside India. The Foreign Exchange Management Act, 1999, empowers RBI to frame regulations for prohibition, restriction or regulations of acquisition and transfer of immovable property in India by a person resident outside India. In terms of the aforementioned stated powers, RBI has laid down master directions (earlier known as master circulars) along with the notifications and circulars, time and again to regulate the transactions involving foreign currency in India. 

The regulations governing the acquisition and transfer of immovable property situated in India are governed under the following act, direction and notification:

1. Section 6 of the Foreign Management Exchange Act, 1999 (“Act”);
2. Master Direction – Acquisition and Transfer of Immovable Property under Foreign
   Exchange Management Act, 1999 bearing no. RBI/FED/2015-16-7, FED Master Direction No. 12/2015-16 dated January 1, 2016 [last updated as on April 11, 2018] 9(“Master Direction”); and 
3. Notification bearing no. FEMA 21(R)/2018-RB dated March 26, 2018 (“Notification”). 

Foreign Company – Person Resident outside India

As per Section 2(w) of the Act, person resident outside India means a person who is not resident in India.

In order to understand the concept of Person Resident outside India, one needs to understand what “person resident in India” means. As per Section 2(v) of the Act, person resident in India means:

1. a person residing in India for more than one hundred and eighty-two days during the course of the preceding financial year but does not include –
   1. a person who has gone out of India or who stays outside India, in either case:
      1. for or on taking up employment outside India, or
      2. for carrying on outside India a business or vocation outside India, or
      3. for any other purpose, in such circumstances as would indicate his intention to stay outside India for an uncertain period;
   2. a person who has come to or stays in India, in either case, otherwise than:
      1. for or on taking up employment in India, or
      2. for carrying on in India a business or vocation in India, or
      3. for any other purpose, in such circumstances as would indicate his intention to stay in India for an uncertain period;
2. any person or body corporate registered or incorporated in India;
3. an office, branch or agency in India owned or controlled by a person resident outside India,
4. an office, branch or agency outside India owned or controlled by a person resident in India.

On critically analyzing Section 2(v)((ii) of the Act, it would not incorrect to state that anybody corporate not registered or incorporated in India would be called person resident outside India. Therefore, foreign companies would qualify to be called as a person resident outside India. However, in line with Section 2(v)(iii) of the Act, branch or office or any agency of such body corporate shall not be considered as a person resident outside India provided such branch, office or agency is situated in India.

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When can a Foreign Company Acquire or Hold Properties in India?

As per Section 6(5) of the Act, a person resident outside India may hold, own, transfer or invest in immovable property situated in India only when such property is acquired, held or owned by such person when he was resident in India or inherited from a person who was resident in India. 

Further, Clause 7 of Part II of the Master Direction and Clause 4 of the Notification states that branch, office or any other place of business, other than a liaison office, which has been established by a person resident outside India can acquire immovable property in India. However, such property can only be purchased when it is necessary or incidental to the activity being carried on by the branch or office. 

In addition to the aforementioned requirement, the person resident outside India who has acquired immovable properties in India has to file Form IPI within a period of 90 days from the date of the acquisition. However, acquisition of immovable properties by branch offices of persons of Pakistan, China, Bangladesh, Sri Lanka, Afghanistan, Iran, Hong Kong, Macau, Nepal, Democratic People’s Republic of Korea and Bhutan has been carved out in the said clause unless prior approval has been obtained by RBI.

Further, in addition to the above requirement, Clause 4 of the Notification also includes blanket provisions stating that such person acquiring immovable property through its branch or office should be compliant with all the laws, rules, regulations or directions for the time being in force. 

In light of the abovementioned provisions as contained in the Act, Master Direction and Notification, foreign companies are not allowed to acquire properties by any means including asset sale in India except on occasions when such foreign companies have branch or office situated in India. In addition to the requirement of having such a branch or office in India, such immovable property can only be acquired when acquiring such property would be necessary or incidental to the business of such branch or office and not to the business of the foreign company.  

Whether repatriation of sale proceeds allowed or not?

Clause 8 of the Master Direction, as well as Notification, states that sale proceeds generated from the sale of immovable property acquired by such person resident outside India through branch or office shall not be repatriated outside India without the general or specific permission of the Reserve Bank of India.

Exceptions

In terms of Clause 1 of Part II of the Master Direction, the aforementioned restrictions shall not apply to acquisition or transfer of immovable property in India by a person resident outside India in case of a lease not exceeding five years.

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Civil Procedure Code(CPC) carries 10 marks as per the latest Bar Exam syllabus. 

Initiation of civil proceedings (includes jurisdiction and pleadings) 

The Code of Civil Procedure (CPC) lays down the detailed procedure for determination of disputes by courts of law. In general, the Code of Civil Procedure is applicable to all civil disputes (that is, private disputes, which are not criminal). The only instances where it does not apply are: 

Where the parties agree to privately resolve the dispute through contract, such as by arbitration. 

Where an independent tribunal has been established and the jurisdiction of civil courts is excluded. For example matters pertaining to the terms of service of government servants, income tax or regulatory matters are decided by dedicated tribunals established under other legislations (such as the Income Tax Act Appellate Tribunal under the Income Tax Act). 

Where a particular legislation provides jurisdiction to another forum. E.g. the jurisdiction for winding up of a company’s affairs usually vests in the High Court. The CPC is an extremely detailed statute and commentaries on the CPC run into several thousands of pages – that kind of study, however, is not important from the perspective of the All India Bar Exam. 

Our scope is limited in this chapter – to help you gain familiarity with the various concepts and procedural details used in the bare act. For this purpose, you should remember that the CPC is different from other legislations, in the sense that in addition to the statutory provisions under various ‘sections’, it also contains ‘orders’ explaining details of specific aspects. For those who wish to gain familiarity with the subject, the trick is to initially develop an ability to correlate the various sections with corresponding orders in the bare act to gain a holistic understanding of the relevant concept. 

In this chapter on CPC, we will take you through the various stages of a civil case – after the audio visual lectures for each stage, you will then have to attempt various practice questions. This should help you in understanding the concepts you learn and familiarize you with the provisions of the bare act which pertain to those concepts.

You will also be able to build confidence in using the bare act to look up the answers to a variety of questions. For further practice, you may also practice questions in separate exercises and practice tests which we will upload on the platform from time to time. Let’s begin with the first step you can take, when a dispute of a civil nature comes into existence. 

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Step 1 – Filing a case in a court 

A civil case (called a suit) may be filed in case of a dispute between two parties – say, when there is a 

dispute over performance of a contract, or for payment of money. It is commenced by filing a plaint. 

The specific event which entitles you to file a suit is known as a ‘cause of action’ – e.g. the time from which one party alleges that some action was to be performed by another party (but was not performed) or the time from when payment was due (but not paid). The time period within which a case may be filed should be within the Limitation Act (discussed separately). 

In which court should you file a suit? 

Every suit that you file will have a monetary value. How is the monetary value of a suit determined? 

The monetary value of a suit is determined as per the principles mentioned under the Suits Valuation Act, 1887 (not relevant to be discussed in more detail). 

Courts have jurisdiction depending on the monetary value of a suit. For example, the District Court in a particular district may only accept cases above INR 1 lakh. Suits having a lower monetary value may have to be filed in courts of civil judges (junior division) or courts of Small Causes. This monetary limit specifies the ‘pecuniary jurisdiction’ of a court. Pecuniary jurisdiction based on monetary value differs from state to state. The pecuniary limits of courts in Maharashtra may be different from limits in West Bengal.

A suit must be filed in the lowest court that is competent to try it. For example, if a suit of value lower than Rupees 1,00,000 can be tried in a court of civil judge (junior division), then it cannot be filed before the district court or the high court. 

Where should the Court be located? (Sections 16 – 20) 

There should be some relation between the court where the suit is filed and the place where the dispute arose. This concept is understood as the territorial jurisdiction of a court. 

Step 2: Completion of pleadings 

A suit is commenced by filing a plaint. A plaint should be filed in the appropriate civil court as per the principles discussed above. The defendant files a response to the plaint in the form of a ‘written statement’. The plaint and the written statement are referred to as the pleadings. Section 26 and Orders VI-VIII deal with pleadings. 

Part 2 

Interim Relief, Hearing and Attendance of Parties 

Understanding Interim Relief 

The final determination of a suit by the civil court can take a long while, often a few years. Therefore, filing of a suit is often accompanied by applications for interim relief, which claim temporary remedies or they request the court to order one of the parties to preserve the status quo. For example, imagine a situation where a particular piece of land is to be sold, the ownership of which is disputed between A and B.

The court may pass an interim order preventing sale of the land pending final determination of the suit, or it could order that sale proceeds be received in an independent account operated under directions of the court (which is not within the reach of either A or B). Interim injunctions are governed by Order 39 of the CPC and Sections 36-42 of the Specific Relief Act, 1963. Ordinarily, an injunction is issued after hearing the defendant – however, the court has powers to issue injunctions without granting a hearing in exceptional cases. An order of injunction passed without hearing the defendant is known as an ex parte ad interim injunction. 

Part 3 

Step 2: Hearing and attendance of parties 

Part A: Attendance of parties and witnesses (Sections 27-32, CPC) 

When a plaint is filed, the court issues an instrument called a ‘summons’ to the defendant informing him to be present before it on a particular date. A summons may also be issued to witnesses to present themselves before the court. [See Order 16 for details of summons for attendance of witnesses] 

The defendant has a right to be heard by the court. Hearing the defendant will also help the court to decide the issues in dispute more effectively. In many cases, defendants abuse this right and remain outside the court’s jurisdiction to delay or frustrate legal proceedings, which can cause additional difficulties in the determination of the suit. 

If the court is of the opinion that the defendant may travel outside its jurisdiction to avoid or obstruct legal proceedings, it may issue a warrant of arrest to produce him before the court and explain why he should not be required to furnish security for the claim against him, pending determination of the suit by the court. If the court is not satisfied by his explanation, the defendant will be required to furnish security before being released.

Similarly, if the court suspects that any property in dispute may be transferred by the defendant to defeat or frustrate legal proceedings, it may order the defendant to explain why he should not furnish security for the value of the claim. If it is not satisfied, it may ask the defendant to furnish adequate security, or it may even order attachment of the defendant’s property. [See Order 38 of the CPC for details of powers of a court relating to arrest and attachment prior to judgment] 

Part B: Framing of issues at the first hearing 

Once the filing of the pleadings is complete, the parties must appear before the court on the date of hearing. It is important for the parties to appear before the court (in person or through authorized representatives) on the date of hearing, absence can have serious consequences – the suit may be dismissed if the plaintiff himself is absent, or it may be decided on its merits without hearing the defendant (i.e. ex parte) if the defendant is absent. In case of dismissal or ex parte decision there are limited remedies available to the aggrieved party. [See Order 9 for more details] 

As the case proceeds, the court may grant additional time upon request to a party (called an adjournment. An adjournment is available for under exceptional circumstances and only a limited number of times as per the CPC, although in reality this provision is not strictly followed by the courts. See Order 17 for more details] 

Part C: Taking evidence to determine the issues 

At the first hearing, the court frames ‘issues’ on the points on which, according to the court, differences exist between the parties. The court may frame both ‘issues of fact’ and ‘issues of law’. For details on how issues must be framed see Order 2 of the CPC. Facts which are relevant to decide the issues may be established through several ways: 

By providing evidence 

For example, the court may orally examine the parties present before it [See Order 10 of the CPC for more details on examination of parties]. In the event a party or a witness cannot be personally examined inside the courtroom, the court can issue an ‘interrogatory’, essentially containing questions to which answers can be given in writing.

The party to which the interrogatory is issued is not required to be personally present before the court to provide answers. [See Order 11 of the CPC for more details]. Where one of the parties relies on a particular document which has not been furnished to the other party, the court may issue notice for its inspection by the other party. [See Order 11 of the CPC for more details] (Discussed in greater detail under the chapter on Evidence Act). 

By admissions – An admission is made when a party acknowledges that a particular fact alleged by the other party is true. It may be made by specifically accepting or by not rebutting.

 For example, if a defendant does not specifically deny a particular allegation made in a plaint in his written statement, he is considered to have admitted its truth. This is an example of where an admission is implied by law. The form in which admissions should be made in civil cases is also provided in Order 12 of CPC. (Discussed in greater detail under the chapter on Evidence Act) 

By affidavit. For more details on the matters and procedure for proving matters through affidavits, see Order 19 of CPC. The court has wide powers to enable it to understand and determine the points that are disputed. In certain cases, the court may be required to make a technical finding – e.g. determining the exact boundary of a particular piece of land, making a partition, examination of accounts, etc. In such cases, it can issue a commission for the determination of such technical matters. [See Section 75 and Order 11 of the CPC for more details] 

Part 4 

Step 3 – Decisions/ reliefs that can be ordered by a court – decrees and orders 

The final determination of a suit is usually in the form of a ‘decree’. A decree may be preliminary or final. For certain suits, the court may pass a preliminary decree. E.g. a preliminary decree is always passed in a suit for foreclosure of a mortgage (foreclosure is discussed in Transfer of Property). 

The suit is disposed of after a final decree. E.g. In a suit filed by A against B for breach of contract to construct a building, if the court finds that there has been a breach by B, it may issue a decree stating that B is liable to pay compensation to A of, say Rs,. 10,000 for the breach. A decree may be accompanied by various other ‘orders’ – which typically contain other reliefs for parties. For example, if B was found to be interfering with other potential contractors to whom A was considering transferring the work (due to the breach), the Court could issue an order restraining B from meddling or interfering with any such discussions by A. 

Let’s take the example of a suit filed by Deep against Shekhar pertaining to the declaration of title (i.e. ownership) over a piece of land in New Delhi. If the court determines that Deep is the owner of the property, it may issue a decree to such effect, accompanied with an order of ‘permanent injunction’ against Shekhar.

This order of permanent injunction will restrain Shekhar from interfering with Deep’s rights of ownership over the land. An order may also be passed with respect to an interim application – for example, before the court decided the suit between Deep and Shekhar, it could have passed an order of temporary injunction (of course, if an application to that effect had been filed by a party) to preserve status quo. If Deep was then in possession of the property, it could have ordered that Deep continues to hold the property final determination of the suit. This order may be ‘vacated’, that is, revoked subsequently, if the court determines that Shekhar is the owner of the property, or it could be made ‘permanent’, if the court finds that Deep is the owner. 

Step 4 – Actions that can be taken against various decisions of a court 

A party has various options available against a decision of the court, as explained below: (there could be a button which plays this commentary on foreclosure – ‘Foreclosure’ is a term related to mortgage of  property. Assume that a person obtains a loan from a bank after mortgaging his property in favour of the bank, as a security. If he defaults on the loan, the bank will have the right to sell his property and recover the amount of the loan. In  case he defaults, before the bank can sell the property, it will have to apply to a court for an order preventing the homeowner from repaying the loan and reclaiming his property – this is known as ‘foreclosure’. More details are covered in the Transfer of Property Act.) 

Certain orders of the court are appealable. These are listed in Order 43 of the CPC. In such cases, the party can directly file an appeal before the higher court against the order, even though the suit has not been disposed of finally by the lower court. For orders that are not expressly listed down as appealable under Order 43, a petition for revision may be filed in the superior court. However, it is on the discretion of the superior court to entertain a revision petition. On the other hand, decrees are by definition appealable, that is, a party has a statutory right to appeal before a higher court against a decree of a lower court. 

A review petition can also be filed (in which case the same court which issued the decision will look into it, instead of a higher court). However, the scope of a review petition is severely restricted – it can be entertained only to correct extremely obvious mistakes or errors, or new material which could not have been discovered earlier by the parties even by exercising due diligence (See Order 47 of the CPC for the scope). 

New Part 

Step 5 – Enforcing decisions of a court 

A decision of a court may be declaratory, i.e. that it may, for example declare X to be the owner of a piece of property. It may command a person to pay something monetary – e.g. in the form of compensation, damages, to return someone else’s money which was retained, to pay a fair amount for services received, etc. or it may require the person to restrain himself from performing certain actions. It could require him to vacate a particular piece of land and not to interfere with its use by the person who occupies the land lawfully. In certain cases, it may direct a person to specifically perform a particular action. These reliefs flow from the CPC and another statute called the Specific Relief Act (which will be discussed later). 

In case a party does not obey the directions of the court – the decree and orders of the court will have to be ‘enforced’. Enforcement of court orders is known as ‘execution’ – it is probably the single topic that has the largest number of provisions devoted to it – Sections 36 – 74 and Order 21 of the CPC deal with execution. Depending on the type of decree, execution is may involve attachment of property (which includes immovable property such as land, or movable property such as jewellery and other possessions, shares, money in bank accounts, etc.). Let’s take a few practice questions to understand the execution in greater detail. 

Tentative Topics- Attachment, sale (possible only on notice), arrest (when arrest not permissible), mode of attachment of immovable, movable property, execution outside India, limitation for execution, time from which execution proceeding can be filed, minimum time limit (in case of government) where no execution is permitted, court before which execution application can be filed, etc. 

CPC (Advanced) – Topics on which conceptual practice questions (1-4 max. per topic) should be framed 

• Relationship between sections and orders 
• Rules made by High Courts 
• Res judicata, stay 
• Costs 
• Interest 
• Summons 
• Summoning and attendance of witnesses 
• Suits against minors 
• Suits against corporations and firms 
• Suits against government or public officers 
• Suits against naval or military men 
• Suits against minors, persons of unsound mind and indigent persons 
• Interpleader suit 
• Summary suit 
• Receiver 
• Frame question on exemption from personal appearance 
• Question on Letter of Request (s. 76) 
• Question on Section 81 – personal attendance and attachment not necessary for public servant 
• Frame questions on ‘definitions’, the day the CPC came into force 
• Caveat 
• 1 question on enlargement of time 
• 1 question on Inherent powers 
• Appointment of receivers 
• Appeals from original decrees 
• Public nuisance 
• 1-2 questions on costs 
• Alternative dispute resolution 
• Specific performance 
• Basics of limitation 

Quiz 1 

1.) If A resides in Mumbai and B resides in Pune, and B wants to file a suit disputing ownership of A over a house located in Mumbai (immovable property), where should it be filed? Where would you file if the house was located in Bhopal? 

A.) Pune, Pune 

B.) Mumbai, Mumbai 

C.) Mumbai, Bhopal 

D.) Pune, Bhopal 

2.) If A resides in Mumbai and B resides in Pune, where should B file a suit if the subject matter relates to movable property, e.g. antique furniture or jewellery? 

A.) Pune 

B.) Mumbai 

C.) Pune or Mumbai, at the option of A 

D.) Pune or Mumbai, at the option of B 

3.) If A resides in Mumbai and B resides in Pune, where should B file the suit if the dispute relates to payment for the performance of certain services (that is, neither immovable nor movable property)? 

A.) Pune 

B.) Mumbai 

C.) Pune or Mumbai, at the option of A 

D.) Pune or Mumbai, at the option of B 

4.) If A owns a plot of land on a highway which spans across two districts, and hence falls within the jurisdiction of two courts, where should a suit with respect to a dispute pertaining to the plot of land be filed? 

A.) District where A resides 

B.) District where B resides 

C.) Courts of the district where the suit is filed first 

D.) Courts of any of the two districts in which the property lies

Quiz 2 

1.) In a plaint, the facts should be proved by? 

A.) Affidavit 

B.) Oral Evidence 

C.) Documentary Evidence 

D.) Witnesses 

2.)Within how many days must a written statement be filed? 

A.) 30 

B.) 90 

C.) 60 

D.) 120 

3.) The court can extend the time to file a written statement up to a maximum of: 

A.) 90 days from the date of service of summons on the defendant 

B.) 30 month from the date of service of summons on the defendant 

C.) 60 days from the date of service of summons on the defendant 

D.) 120 days from the date of service of summons on the defendant 

4.) The instrument issued by a court upon filing of a plaint, requiring the defendant to appear in the court to answer the claim is called? 

A.) Notice

 B.) Summons 

C.) Instruction 

D.) 

Warrant 

5.)Summons can be issued to: 

A.) Defendant 

B.) Plaintiff 

C.) Both 

D.) Defendant and witnesses 

6.) Which of these are processes to ensure appearance in a court? 

1. Summons II. Warrant III. Interrogatory IV. Commission V. Affidavit 

A.) I and II only 

B.) I, II, III and IV 

C.) I, II and V 

D.) All of the above 

7.) The format in which pleadings must be drafted are mentioned in: 

A.) Annexure A of the Code of Civil Procedure (CPC) 

B.) Order VI of the CPC 

C.) Order VII of the CPC 

D.) Order VIII of the CPC 

8.) In a written statement, what among the following is true regarding denial of facts alleged in the plain by the other party? 

A.) The defendant may general deny the alleged facts 

B.) The defendant must specifically deny each and every alleged fact 

C.) The defendant may not deny any allegation in the written statement but later in the hearings 

D.) The defendant must provide an evidence supporting every denial made in the written statement 

9.)A owes a sum of Rs. 5000 to a partnership firm of B & C. B pays all his liabilities and retires as a partner. A sues C for recovery of Rs. 8000 due in his personal character. Which of these are claims are available to C in the written statement? 

A.) He is not required to mention any sum at all 

B.) He must file a separate suit for recovery of Rs. 5000 owed to the partnership and not include it in this pleading 

C.) He must make file a separate interim application to combine his claim of the debt of Rs. 5000 in this suit 

D.) He may ask the debt of Rs. 5000 to be set-off in the written statement 

10.) Who must sign a pleading for it to be valid and enforceable,? 

A.) Party alone 

B.) Party or his attorney or advocate 

C.) Party or his authorized signatory 

D.) Attorney or the advocate representing the party alone 

11.) Which of these is false about a pleading? 

A.) Must contain facts only 

B.) Must contain facts and supporting evidence 

C.) Must contain numerals in words 

D.) Must be accompanied by an affidavit 

12.) Which of these is not allowed under the CPC? 

A.) Striking out of pleadings by the Court 

B.) Striking out of pleadings by parties 

C.) Amendment of pleadings 

D.) Subsequent pleadings 

Quiz 3 

1.)An interim injunction can be issued: 

A.) To prevent wastage or damage of property which is in dispute 

B.) To prevent the defendant from transferring the property with the intention of defrauding his creditors 

C.) To prevent the defendant from dispossessing the plaintiff of the property or causing other injury to the plaintiff by dealing with the property in any manner 

D.) All of the above reasons 

2.) In the event of a breach of an order for injunction by the defendant, the court may 

A.) Order the property of the defendant to be attached 

B.) Order the detention of the defendant in a civil prison 

C.) Issue a proclamation for the defendant 

D.) Both a and b 

3.) The maximum period of detention in civil prison prescribed under the CPC for breach of an order of temporary injunction is: 

A.) 1 month 

B.) 3 months 

C.) 6 months 

D.) 1 year 

4.) The maximum period of validity of an order of attachment for breach of an order of temporary injunction is: 

A.) 1 year 

B.) 1 month 

C.) 6 months 

D.) 3 months 

5.) In case the breach by the defendant of an order of temporary injunction continues even after the maximum duration (that is permissible under law) of the attachment order has passed, the available remedy is: 

A.) Sale of the attached property 

B.) Sending to rigourous imprisonment 

C.) Judicial custody 

D.) Fine 

6.)An ad interim ex parte injunction may be granted: 

A.) As per discretion of the court 

B.) Where the court is of the opinion that the object of granting the injunction would be defeated by delay 

C.) Where both parties agree 

D.) Only in cases where the subject matter of the suit is a perishable commodity 

7.) 1. Which of the statements below are true? 

1. Temporary injunctions are governed by CPC 
2. Perpetual injunctions are governed by CPC 

III. Temporary injunctions are only governed by Specific Relief Act 

1. Perpetual injunctions are governed by Specific Relief Act 

A.) II and III 

B.) I, II, III and IV 

C.) I and IV 

D.) I, II and IV 

Quiz 4 

1.) If it suspects that disputed property may be alienated or that the defendant may escape its limits, a civil court can exercise certain powers to protect the claim. Which of these is not within the ambit of such powers? 

A.) The power to order attachment of immovable property 

B.) The power to order the defendant to furnish security 

C.) The power to order the defendant to show cause why he should not furnish security 

D.) The power to order the defendant to offer agricultural produce as security 

2.)As per the CPC, which of the following courts cannot attach immovable property pending judgment: 

A.) High Court 

B.) City Civil Court 

C.) Small Causes Court 

D.) District Court 

3.)Pending determination of a suit, if a Small Causes Court suspects the defendant to move out of its jurisdiction or to alienate disputed property: 

A.) Issue a warrant of arrest requiring the defendant to show cause why he should not furnish security 

B.) Attach all kinds of property 

C.) Attach any property except immovable property 

D.) Both a and c 

4.) The process of attachment of property (for the purpose of security) before passing a judgment: 

A.) Is identical to the process of attachment at the time of execution for decree 

B.) Largely similar, but differs in minor respects 

C.) Is entirely different from the process of attachment at the time of execution for decree 

D.) None of the above 

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This article is written by Siddharth Chapalgoankar, pursuing a Certificate Course in Arbitration: Strategy, Procedure and Drafting from Lawsikho.com. Here he discusses “New Delhi International Arbitration Centre: All You Need To Know”.

Introduction and Background

The New Delhi International Arbitration Centre Act, 2019 was passed by the Parliament. Before going into the details about the Act and the mandate of the Centre, it is pertinent to have a background about what circumstances and developments led to the passing of this Act.

With the advent of Liberalisation, Privatisation and Globalisation regime in India in the 1990s and beyond, the volume of economic activities grew manifold and so the number of disputes arising out of it. This resulted in an increasing burden on the Courts of law. Thus, Arbitration and Conciliation Act, 1996 was enacted. As the Act was in force, there arose the need to promote institutional arbitration because of Ad-hoc arbitrations being highly time-consuming as well as exorbitant and also the Courts apparently taking over the arbitration proceedings, thus the Arbitration and Conciliation (Amendment) Act, 2015 was enacted.

At the same time increasing Foreign Direct Investment in various sectors, indicators like Ease of doing business in general and enforcement of contracts (the indicator where India has lot of scopes to improve upon) in particular a special mechanism had to be set up in place to promote institutional domestic as well as international arbitration and also to make India a preferred destination by the foreign parties for arbitration.

Thus a committee was formed in 2016 headed by former Supreme Court Judge B.N. Shrikrishna. The Committee was mandated with the task of identification of the roadblocks to the development of institutional domestic as well as international arbitration, analysing the specific issues that affect the Indian arbitration landscape, and preparing guidelines for making India a “Robust centre for international and domestic arbitration”.

Report of the Committee

The Report of the Committee which was given in 2017 is divided into three parts. Part I contains the Committee’s findings on institutional arbitrations in India and its recommendations. Part II contains a study of working and performance of the International Centre for Alternative Dispute Resolution and the Committee’s recommendations for its reform. Part III deals with the role of arbitrations in BIT disputes involving the Union of India and the committee’s recommendations for the same.

It is the Part II of the report which forms the genesis of the New Delhi International Arbitration Centre and therefore it is necessary to have a look at Part II of the Report.

ICADR

The Part II of the Report deals with the working, performance and functioning of the International Centre for Alternative Dispute Resolution and recommends the reforms for the same.

ICADR was set up in 1995 under the aegis of Ministry of Law and Justice,  Government of India, with the objective of promoting alternative dispute resolution methods and providing facilities for the same.

The Report examines the role of ICADR and describes in detail, the shortcomings of the institution.

1.  the ICADR has failed to keep pace with the dynamic nature of arbitration in spite of having eminent lawyers and judges on its Governing Council, the body has been unable to actively embrace the developments in arbitration ecosystem and create a reputation for excellence. The organisation has completely failed to market itself to the parties at the stage of the contract formation which is essential for an arbitral institution. ICADR has very few cases and even Government/PSU do not prefer it to be a destination for arbitration.
2. The size of the present Government Council is too large and there is a need for a fresh face to handle the working of the organisation
3. The ICADR  rules are outdated failing to catch the global development of arbitration law. Other worldwide competing institutions have revised their rules and have included provisions regarding rejoinder, consolidation of arbitral proceedings, emergency arbitrators. But the ICADR rules have failed to do so although there was a revision of rules in 2016. ICADR has conducted national and international conferences pertaining to institutional arbitration, yet it has failed to update its rules with the industry standards.
4. ICADR has sufficient infrastructure to support arbitration hearings including arbitration rooms, waiting for lounges for arbitrators, library facilities and video conferencing facilities, yet these appear to be put to limited use. The design of arbitration rooms is not suitable for the proceedings to be conducted. If the ICADR can be promoted as a venue for arbitration hearings, it might result in increased visibility for the institution.

On the backdrop of this Committee went on to recommend that either the ICADR be developed into flagship arbitral institution by rectifying the shortcomings or the Centre be fully replaced by a statutory body for institutional arbitration. And thus it gave away to New Delhi International Arbitration Centre.

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New Delhi International Arbitration Centre

New Delhi International Arbitration Centre Act, 2019 replaces the New Delhi International Arbitration Centre Ordinance, 2019 which was promulgated in March 2019.

The Act seeks to provide for the establishment of NDIAC to conduct an arbitration, mediation and conciliation proceedings. It declares NDIAC as an institution of national importance. The Act seeks to transfer IDAC to Central Government and upon notification by the Central Government, all the rights, title and the interest in the ICADR will be transferred to the NDIAC.

Composition

The Act provides for the composition of members of NDIAC. There will be seven members including (i) a Chairperson (ii) not more than two persons having substantial knowledge and experience in institutional arbitration; (iii) three ex-officio members, including a nominee from the Ministry of Finance and a Chief Executive Officer (responsible for the day-to-day administration of the NDIAC); and (iv) a representative from a recognised body of commerce and industry, appointed as a part-time member, on a rotational basis.

Term

Membership 3 years. Eligible for reappointment? Yes. Retirement age = Chairperson 70 years, members 67 years.

Objectives of NDIAC

The key objectives of the NDIAC include (i) promoting research, providing training and organising conferences and seminars in alternative dispute resolution matters; (ii) providing facilities and administrative assistance for the conduct of arbitration, mediation and conciliation proceedings; (iii) maintaining a panel of accredited professionals to conduct arbitration, mediation and conciliation proceedings.  

Functions of NDIAC

Key functions of the NDIAC will include: (i) facilitating conduct of arbitration and conciliation in a professional, timely and cost-effective manner; and (ii) promoting studies in the field of alternative dispute resolution.

Finance and Audit

NDIAC will receive funds from Central Government, will receive grants and fees from the arbitration proceedings. The accounts of NDIAC will be subject to audit by CAG

Institutional Support

A panel of arbitrators will be maintained by NDIAC after establishing the Chamber of Arbitration.  The NDIAC may also set up an arbitration academy to train and develop the arbitration law.

Importance of the Move

1. India on the world map – Settlement of commercial disputes is a key factor and this move will help India to come on a global map. Law Minister Ravi Shankar Prasad told during debate on the Bill that India has qualified lawyers and we shouldn’t accept the imperialism in arbitration. India has a lot of scopes to develop the arbitration law. The NDIAC will help to make the arbitration of excellent quality. It will also have a responsibility to hold training, workshops, courses, frame policies, guidelines and update norms to ensure a satisfactory level of arbitrations, arbitral institutions and the arbitrators.
2. To reduce the burden on courts- institutional arbitration is one of the key solutions to reduce the burden on the Court. Today for any matter like the appointment of arbitrators, interim measures parties prefer going to the Courts. The NDIAC aims to reduce the burden of already overburdened courts
3. To provide an exhaustive list to choose an arbitrator– Arbitration is a combination of skill and law. Mere application of law may not suffice in resolving the dispute because the scope and expanse of economic activities are wide. Today it might be a construction dispute and tomorrow some dispute related to the partnership. Hence NDIAC aims to provide a list of arbitrators from the various field which parties can choose on their own.
4. To speed up the arbitration process–  Although arbitration is a speedy mechanism of alternate dispute resolution, the process itself takes time due to various reasons. Hence NDIAC will promote the speedy resolution of the dispute through arbitration. A fixed timeline will be set up before the parties to submit the statement of claims and defence and time-consuming tactics won’t be available at the dispense of parties

Conclusion

Thus the conception of the New Delhi Arbitration Centre is a right step in the right direction for promoting domestic as well as institutional arbitration. Only the concern that remains whether the new institution will really bring changes to arbitration regime in India or it will be similar to its predecessor organisation.

References

1. High-Level Committee to Review the Institutionalisation of Arbitration Mechanism in India.
2. ICADR v. Union of India Review Petition No. 196/2019 in WP (c) 2236/2019 in Delhi High Court
3.  https://www.ijariit.com/manuscripts/v4i5/V4I5-1198.pdf
4. ICADR v. Union of India Review Petition No. 196/2019 in WP (c) 2236/2019 in Delhi High Court
5. High-Level Committee to Review the Institutionalisation of Arbitration Mechanism in India.
6. ICADR v. Union of India Review Petition No. 196/2019 in WP (c) 2236/2019 in Delhi High Court
7. https://www.prsindia.org/billtrack/new-delhi-international-arbitration-centre-ordinance-2019
8. http://constructionclaims.weebly.com/blog/category/all

Students of Lawsikho courses regularly produce writing assignments and work on practical exercises as a part of their coursework and develop themselves in real-life practical skill.

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This article is written by Ehtisham Ali, Law Graduate from Teerthanker Mahaveer University Moradabad (U.P).The articles discuss Examination of Witnesses Under Indian Evidence Act, 1872.

Introduction

Examination of witnesses is an important principle in which witness take a stand of his or her words. For the protection of the integrity of the evidence. It is a very important part of a criminal and civil trial. It is not important only for law students, it is also important for practising lawyers to know the art and law related to examination of witness.

Examination of witnesses under CRPC

Section 135 of Indian Evidence Act deals with the examination of witnesses present. In the Code of Criminal Procedure Section 311 empowers the court to summon a material witness, or to examine a person present at “any stage” of “any enquiry”, or “trial”, or “any other proceedings” under Crpc, or to summon any person as a witness, or to recall and re-examine any person who has already been examined if his evidence appears to it. Examination of witnesses is there in the Code of Criminal Procedure in all the trials either session trial, warrant trial,or summary trial. Examination of witnesses in CrPC are as follows:

• Session trial on prosecution and defence examination (Section 225-237)
• Warrant trial on the police report (Section 238-243)
• Warrant trial on the complaint (Section 244-250)
• Criminal trial on summon cases (Section 251-259)
• Summary trial (Section 260-265)

Examination of witnesses in criminal cases 

The examination of witnesses in criminal cases are present in all the trials of Code of Criminal Procedure, in the warrant trial when police made the report, examination of witnesses are performed by the prosecution after the charges are framed and accused pleads guilty, then the court gives the chance to prosecution to prove the guilt of the accused. Here prosecution needs evidence with statements from its witnesses. This is an examination in chief. In this condition, the magistrate has the power to issue summons to any person as a witness. After examination in chief, defendant can ask the cross-questions from the prosecution witness that is called cross-examination. After the cross-examination if the prosecution has some queries then he asks the question from the witness that is called re-examination. 

The court will examine the witnesses and complainant in the examination of witnesses in warrant trial on the same day after decide any offence is made against the accused or not. Then the magistrate order an inquiry in which the matter submit a report for the same. After the investigation and examination of complainant court may reach the conclusion if the complaint is honest and the prosecution has sufficient evidence against the accused. Then Court convict the accused and if the complaint is not genuine and the court does not find sufficient material through which complainant can convict the accused then Court dismissed the complaint. 

At the end after the examination of the complaint and inquiry report, if the court thinks evidence and material are sufficient, which are produced by the complainant with the prosecution to charge the accused in this situation Court may issue a warrant or a summons. There are different stages of the criminal trial in summons cases as provided in Section 251 to 259 of the Code of Criminal Procedure. 

The procedure of examination of witnesses in the summon cases are same as warrant trial, after the plea of guilty prosecution start the examination of witnesses. The examination of witnesses in a summary trial is same as summons cases and warrant trial. 

Examination of witnesses under CPC

Examination of witnesses is there in order XVIII of rule 4 to 16 in the Code of Civil Procedure. 

Order XVIII Rule 4

1. Rule 4 of Order XVIII said that party who called the witness for the examination of witnesses in every case shall be on affidavit and copies of the affidavit shall be supplied to the opposite party.
2. The examination of witnesses whether it is an examination in chief and cross-examination or re-examination by affidavit has been furnished to the court shall be taken either by the Commissioner or by the Court.
3. The Court or the Commissioner shall record the statement of witnesses during the examination of witnesses either in writing or mechanically in the presence of the judge if there is Commissioner in a case then he shall return such evidence together with his report in writing signed by him.
4. The Commissioner may record such remarks which are very important when objection raised during the recording of evidence. Which are decided by the Court at the stage of arguments.
5. The report which is made by the Commissioner must be submitted to the Court within sixty days.
6. The High Court and the District Court Judge has the power of preparing a panel of Commissioners to record the evidence under this rule. 

Order XVIII Rule 5 

How to take the evidence in appealable cases:

(a) brought down in the language of the Court;

(i) recorded as a hard copy by, or in the nearness and under the individual bearing and superintendence of, the Judge; or

(ii) from the dictation of the Judge directly on a typewriter; or

(b) if the Judge, for reasons to be recorded, so coordinates, recorded precisely in the language of the Court within the sight of the Judge.

Order XVIII Rule 6

Where the evidence is brought down in a language not the same as that in which it is given, and the witness does not understand the language wherein it is brought down, the proof as brought down recorded as a hard copy will be converted to him in the language in which it is given.

Order XVIII Rule 7

Evidence brought down under Section 138 of Indian Evidence Act and the evidence shall be in the form which is prescribed in Rule 5 of Order XVIII, after the read and signed as the event may require, interpreted and repaired as though it wore proof brought down under that rule.

Order XVIII Rule 8

When evidence not brought by the judge in writing for his command in the open Court or recorded automatically in his presence now he shall be bound for the examination of witnesses to make an update of the substance of what each observer expel, and such remainder shall be written and signed by the Judge and will shape some portion of the record.

Order XVIII Rule 9 

Where English isn’t the language of the Court, yet every one of the gatherings to the suit who show up face to face, if an advocate and the group of people does not know the english language then evidence not produced in the Court in English language. 

(2) Where proof isn’t given in English however every one of the gatherings who show up face to face, and the pleaders of such of the gatherings as show up by pleaders, don’t item to having such proof being brought down in English, the Judge may takedown, or cause to be brought down, such proof in English.

Order XVIII Rule 10

The Court may of it if any party file an application regarding a particular question and answer or any objection to any question brought down in the Court if there appears to be any special reason for so doing then Court will accept that application.

Order XVIII Rule 11

If there is question objected by the adverse party and pleader during the examination of witnesses then judge of the Court allows the same to be put and shall be brought down the question, the answer, the objection and the name of the person making it, with the decision of the Court.

Order XVIII Rule 12

The Court may record such comments as it might suspect material respecting the behaviour of any witness while under examination.

Order XVIII Rule 13

Cases in which appeal is not allowed then there is no need to bring down and maintain a record of evidence of witnesses at length, but the judge of the Court records all the examination of witnesses proceeds in a writing and prescribe to the typewriter, or cause to be automatically recorded for the remainder of the case with the sign of the judge.

Order XVIII Rule 14

Judges can not make such reminder to record reasons for his lack of ability.

Order XVIII Rule 15

(1)Where a Judge is prevented by death, move or other reason from closing the preliminary of a suit, his successor may manage any proof or reminder brought down or made under the prior standards as though such proof or notice had been brought down or made by him or under his course under the said principles and may continue with the suit from the phase at which his predecessor left it. 

(2) The arrangements of sub-rule (1) will, so far as they are material, be esteemed to apply to proof taken in a suit moved under Section 24.

Order XVIII Rule 16

Rule 16 of Order XVIII provide the power to examine witness immediately

1.  If the witness leaves the jurisdiction of the court or any other reason which are sufficient satisfaction why his evidence should be brought immediately then Court send the application to the party or of the witness at any time after the filing of the suit. Brought the evidence of such witness immediately.
2. If the Court thinks the reason which is given by the party or evidence is not sufficient then Court fixes the date for the examination of witnesses.
3. The evidence which is submitted to the Court read in front of a witness if there is any change in the evidence then corrected by the Court and signed by the witness and read at any hearing of the suit.

Order XVIII Rule 17

Court has power to recall the witness at any stage of the suit. And ask the question to him as the Court thinks fit.

Order of production and examination of witnesses

It is a lawyer’s privilege to check the order in which he examines the witnesses. According to the experience and skill witnesses are arranged. Prosecutor has the freedom to produce his witnesses in order which he likes. Section 135 of the Indian Evidence Act gives the power to the court to command or order in which the witnesses may be produced. 

Exclusion of witnesses from the courtroom

When the party starts the examination of witnesses of the evidence then the other witnesses must be kept out of the Courtroom. When the examination of one witness is completed then the next witness is called for the examination. And witness whose examination is completed, are not allowed to remain in the courtroom. If the witness remains present in the courtroom then he should be asked to go out. If any witness present during the examination of another witness then his examination can not be refused only a note to be made by the judge that he was present in the courtroom during the examination of another witness.

Delayed examination of a witness

If the examination of prosecution witnesses delayed then defence can not put any question to the investigation officer, the accused had no right to contend that there was a delay in recording the statement of prosecution’s witness and his evidence should be viewed with suspicion. It is not a universal rule of application that the testimony of a witness becomes undependable merely because of delay in his examination.

Admission and evaluation of witness statements

Evaluation of the testimony of a witness 

After the examination of witnesses by the court, the opportunity must be given to the party or parties for making observations. The observations may be made in writing after transmission of the minutes of taking of evidence which is exceptional or either in oral proceedings following the taking of evidence. The efficient department will be decided on this matter. The parties may file requests accordingly.

Efficient department decide the matter of proceed to evaluate the evidence only when a witness’s testimony which is crucial to the decision has been challenged by a party but the department regards it as credible, or when the witness’s oral or written testimony is forgotten in its decision as being not believable credible, the department attentive must state the grounds for its view in its decision.

In assessing an observer’s oral or composed declaration, uncommon consideration is to be paid to the accompanying: 

(i) What is significant is the thing that an observer can relate concerning the focuses at issue based on his own insight or perspectives, and whether he has useful involvement in the field being referred to. Recycled statements dependent on something got notification from outsiders are generally useless all alone. It is additionally significant from the perspective of the assessment whether the observer was engaged with the occasion himself or just is aware of it as an eyewitness or audience.

(ii) In case of long interims of time (quite a long while) between the occasion being referred to and the declaration, it ought to be borne as a main priority that a great many people’s capacity of review is restricted without the help of narrative proof.

(iii) Where declaration seems to struggle, the writings of the announcements concerned are intently contrasted and each other. 

Evident logical inconsistency in the declaration of observers may here and there be settled along these lines. For instance, a nearby assessment of evidently conflicting proclamations by observers about whether a substance X was usually utilized for a specific reason may demonstrate that there is in actuality no logical inconsistency by any stretch of the imagination, in that while one observer was stating explicitly that substance X was not utilized for that specific reason, the different observer was staying close to that substances like X, or a specific class of substances to which X had a place, were ordinarily utilized for this specific reason without expecting to own any expression in regards to substance X itself.

(iv) A representative involved with the procedures can be heard as an observer. The conceivable prejudice of an observer decides how the proof is surveyed, not whether it is allowable.

Relevance of the Testimony

During the examination of a witness when the witness gives the statement under oath, the statement of the witness must be relevant to the case. At the end of the examination of witnesses, the Judge of the court decides the relevancy of the testimony of the witness and admit the statement of the witnesses.

Reliability of the Testimony

Statement of the witness which are given during the examination of witnesses must be true under oath, and at last the Judge of the court decide the reliability of the testimony of the witness and admit the statement of the witnesses.

Judge to Decide as to Admissibility of Evidence

Judges have the power under Section 136 of Indian Evidence Act for the admissibility of evidence in the examination of witnesses and also check the statement of the witnesses which is given by the witnesses during the examination of witnesses that is relevant or irrelevant. Relevant evidence decided by the judges on the basis of In assessing an observer’s oral or composed declaration, uncommon consideration is to be paid to the accompanying: 

(i) What is significant is the thing that an observer can relate concerning the focuses at issue based on his own insight or perspectives, and whether he has useful involvement in the field being referred to. Recycled statements dependent on something got notification from outsiders are generally useless all alone. It is additionally significant from the perspective of the assessment whether the observer has engaged with the occasion himself or just is aware of it as an eyewitness or audience.

(ii) In case of long interims of time (quite a long while) between the occasion being referred to and the declaration, it ought to be borne as a main priority that a great many people’s capacity of review is restricted without the help of narrative proof.

(iii) Where declaration seems to struggle, the writings of the announcements concerned are intently contrasted and each other. 

Evident logical inconsistency in the declaration of observers may here and there be settled along these lines. For instance, a nearby assessment of evidently conflicting proclamations by observers about whether a substance X was usually utilized for a specific reason may demonstrate that there is in actuality no logical inconsistency by any stretch of the imagination, in that while one observer was stating explicitly that substance X was not utilized for that specific reason, the different observer was staying close to that substances like X, or a specific class of substances to which X had a place, were ordinarily utilized for this specific reason without expecting to own any expression in regards to substance X itself. 

(iv) A representative involved with the procedures can be heard as an observer. The conceivable prejudice of an observer decides how the proof is surveyed, not whether it is allowable. 

Scope

Scope of Section 136 of the Indian evidence act is very important as the witnesses comes in the court with the relevant statement because if the witnesses come in the court with irrelevant statement then judge of the court not admitted that statement of the witnesses in the case and due to this all the facts of the cases must be clear, this is also mentioned in the Section 5 of Indian Evidence Act all the facts of case must be relevant. Their are some rules of Section 136 of the Indian Evidence Act.

Rule 1

If any fact proved in the case which is proposed by the party in the evidence then a judge may ask the party in what the alleged fact would be relevant or not. A Judge will decide the fact must be relevant. If the evidence would not be relevant then the judge would not allow the party from proving it as because it would only waste the time of the court. In such condition court may disallow evidence.

Rule 2

If the party suggested the fact of the evidence which is proved in the court and also depend on another fact of the evidence then the other fact must be proved before evidence of the first fact is given. For example dying declaration, if a person wants to prove a dying declaration then he must prove that the declarant is dead. [Illustration (a) and Illustration (b)]. Here admission of fact depends on condition. 

Rule 3

Rule 3 is the exception of rule 1 and 2. If there is a relevancy alleged fact is there which depends on the proof of another alleged fact. In this condition, the judge may allow in his discretion the first fact to be proved without proof of the second fact. But in this condition, the party must undertake to prove the second fact to the satisfaction of the court Illustration (e).

As per the above rules, the question of admission of witnesses in the witnesses is to be decided by the judge. First, he invested all the evidence with wide discretion then allow evidence to be placed on records.

Examination in Chief

Examination in chief is defined under Section 137 of the Indian Evidence Act, when the party calls a witness in the examination of witnesses that is called examination in chief. Examination in chief is the first examination of witnesses after the oath. It is the state in which party called a witness for examining him in chief for the purpose of eliciting from the witness all the material facts within his knowledge which tend to prove the party’s case. It is also known as Direct Examination.

The objective of Examination in Chief

1. It overcomes the burden of proof legally sufficient.
2. Remembered and understand.
3. Persuasive.
4. Hold the cross-examination.
5. Contradictory and anticipatory and of evidence that the opposition will present. 

There is more objective of examination in chief are as follows:

1. Major objectives

1. All the evidence must be admissible.
2. The witness needs to present as intended and capable of being believed.
3. Each and everything related to the fact of evidence of the offence must be proven beyond a reasonable doubt through the witnesses oral evidence and exhibits.

 B. Minor objectives

You also achieve some additional objectives which are less essential but still important:

1. Present a complete and logical, rational theory of the offence.
2. Witnesses present in the best possible light.
3. Mention all the facts in the evidence and attempt to explain the relation between propositions that cannot both be true at the same time.
4. Limiting the exposure of witnesses through the shut down of potential cross-examination.

Examination in chief questions

There would be general questions asked in the examination in chief which is related to the facts of the evidence no leading questions are asked in the examination in chief. Leading questions are asked only in cross examination and re examination, first of all, prosecutor ask the question in the examination in chief in the criminal trial. 

Cross Examination

After finishing the examination in chief, cross-examination will start. In the cross-examination defendant lawyer asks the cross-question which was asked by the prosecutor. Defendant lawyer may ask the questions which are related to the facts and the defendant can also ask the leading question in the cross-examination which were not allowed in the examination in chief. Cross examination is very important in the examination of witnesses, due to the cross-examination many facts get clear because in the cross-examination defendant analyse all the statements of the witnesses then asks cross question related to the statement which was given by the witnesses in the examination in chief. The Defendant can also ask the question which was not related to the examination in chief but related to the facts of evidence.

Cross Examination in civil cases in India

All the witnesses in civil cases which are produced or examined by the court on the wish of parties must be presented before the court within 15 days from the date on which issues are framed or within such other period as the court may fix. Then parties have to file a list of witnesses in the suit. After that court can ask the witnesses for examination by sending summons or parties may call the witnesses by themselves. If the court issued a summons for asking the witnesses for the examination then the expenses which arise due to the calling of witnesses by issuing summons has to be deposited by the parties. The money deposited by the parties in this condition is known as “Diet Money”. The date on which the parties wish to produce and examine the witnesses in the court that is hearing. Now the hearing will decide the court on the date of hearing. First thing is done by the plaintiff”s examination in chief in which he asked the question which was seen by the witness. After that defendant ask cross-questions which were asked by the plaintiff in the examination in chief. And after the cross-examination is over at this stage the court will fix a date for final hearing. 

Cross Examination in criminal cases in India

There are different stages of cross-examination in criminal cases in the criminal trial in a warrant case instituted on the police report After the charges are framed, and the accused pleads guilty, then the court requires the prosecution to produce evidence to prove the guilt of the accused. The prosecution is required to support their evidence with statements from its witnesses. This process is called “examination in chief”. The magistrate has the power to issue summons to any person as a witness or orders him to produce any document. After the examination in chief, the adverse party asked the cross-questions to witnesses that is called cross examination.

Re examination

The party who attend the witness for the cross-examination shall be called re-examination. If the party not subjecting to cross-examination as per the court order then it is not safe to trust on examination in chief.

Difference between examination in chief, cross examination, re examination

Section 137 of Evidence Act and Section 145 of the Negotiable Instruments Act

Section 137 to 143 0f Negotiable Instruments Act laid down the procedure for the trial of discredited cheque cases in a very simple manner with the main aim that trial of those cases should follow a course in a very simple manner as compared to summary trial. Sometimes a special procedure fails to effectively and efficiently deal with the large multitude of cases coming to the Court. The argument that the complainant or any of his witnesses whose proof is given on affidavit must be made to force out in examination-in-chief all over again seem to be a request urgently for unimportant, duplication seemingly aimed at holding the trial. 

As per Section 145(2) of the negotiable Instruments Act, the court may, at its prudence, call a person giving his proof on affidavit and examine him as to the fact controlled therein. But if an application either made by the accused or by the prosecution, the Court has the power to call the person giving his proof on affidavit again to be examined as to the facts controlled therein. 

The point and nature of examination in each case different matter to be sensibly controlled in the light of Section 145(1) and having considered the aim and purpose of the entire scheme under Sections 143 to 146, Negotiable Instrument Act. In these Sections judge’s power is not affected in any way under Section 165 of the Evidence Act. 

Section 145(2) of the Negotiable Instruments Act under which the affidavit of the person summoned which is already on record is obviously in the nature of examination in chief. Hence, on being summoned on the application made by the accused, a person who testifies or gives a deposition of the affidavit can only cause to experience or suffer or make liable to cross-examination as to the facts stated in the affidavit.

Section 138 of the Indian Evidence Act

Order of examination

First of all, witnesses shall be examined in the examination in chief afterword cross-examination by the opposite party if the opposite party desires, at last re examination by the first party if the first party calling the witnesses for the re examination. All the examinations of witnesses must relate to relevant facts, but the cross examination no need to be controlled to the facts to which the witness examine on his examination in chief. 

Direction of re examination

The explanation of matters referred to in cross examination shall be directed by the re examination, and if new matter introduced in the re examination with the permission of the court the opposite party may further cross-examine upon that matter.

Examination of a witness

Section 137 and 138 are so related to each other that it would be suitable to deal with them together. There are three stages in which witnesses are examined, these are examination in chief, cross examination, re examination under Section137 of Evidence Act.While Section 138 of Evidence Act gives an order of examination in chief, cross examination, re examination. It also gives the extent to which examination in chief, cross-examination and re-examination may go. This Section does not deal with the admissibility of proof, but simply establish that a witness shall first be examined in chief, then cross examined and lastly re examined. 

No examination in chief and cross examination

If witness on particular facts and issues not examined in the examination in chief and he has not been cross-examined on the said aspect of the matter by the defence.

Admissibility of evidence of a person with unfinished cross examination

At the point when evidence of the defendant was recorded on commission. If there was a death of defendant and cross-examination was only partly held. Now his evidence will be admissible as there was no provision under law that if the witness was not cross-examined either in full or part his evidence would be absolutely rendered inadmissible. It is further held that the provision of Section 33 will not be applicable in such a case and how much weight shall be attached should be decided considering other facts and circumstances surrounding it.

Cross examination : A wide scope

Section 138 of the Indian Evidence Act provides a wide scope for cross examination. What is spoken to in examination in chief is not to be controlled. Section 138 of the Act clearly provides that examination in chief and cross examination must relate to relevant facts in the opening part of the second half of the Section. But the facts to which the witness had stated in his examination in chief need not be controlled in cross examination. Therefore, the question must be relevant to the fact in cross examination which was necessary to be proved by that witness. If there is any difference in respect of the relevancy of the facts was acceptable only to the dependability, character and such other things concerning the witness.

That was the reason why the scope of cross examination of the witness is wider, in order to present the quality of being believable of the witness or otherwise. The defendant can not use to establish the case in which he was required to independently establish by producing relevant documentary or oral proof to discharge the burden which was cost on him with the presence of such a wider scope of cross examination which is conferred for purposes of cross examination. If by mistake any party comes to the witness-box and take an oath and deposes about a document, he becomes a witness and must be liable to be cross examined by his defendant. Cross examination of his maybe about the whole case. If cannot be controlled to only the facts declared by him in examination in chief. If any witness proving a document may be defendant can be cross examined on another point. 

All the questions are permissible which are asked to challenge the evidence in examination in chief. There is no provision regarding cross examination should be controlled and what is agreed by a witness and cannot clarify the answers to challenge in cross examination. Every accused against him a prosecution witness gives evidence is entitled to cross examine the prosecution’s lawyer. Such a statement may be made in the cross examination of another witness or in the examination in chief. An accused is entitled to put an additional question to a prosecution witness by way of cross examination in respect of what he had declared in answer to questions put to him in cross examination by the other co accused.

If the evidence relevant which is given by one defendant against a co defendant, he is entitled to cross examine the deposing defendant. The defendant may cross examine the witness which is produced by the other defendant, even if they have a common defence. If the one defendant is refused permission to cross examine the witness then the evidence produced by the other defendant not admissible.

The important part of the case to be put in cross examination

It is a rule of justice which plays an important and crucial role, that a party must put in the cross examination of a witness in a case. It is a strong rule of evidence that party should use to each of his opponent’s witnesses so much his case as care that particular witness. The courts assume that the witness’s account has been accepted if no questions are put. Witness attention must first be directed to the fact by cross examination, if it is intended to suggest that a witness was not speaking the truth upon a particular point so that he may have an opportunity of giving an explanation. 

The examination in chief cannot rely upon if a witness after being examined up to the phase of examination does not subject to cross examination in spite of the order of the court.

If the witness had testified on his examination in chief need not be controlled to facts in the cross examination of a witness, order refusing to grant permission to put questions beyond the contents of punchnama could not be sustained. 

Effect of not cross examining

When there is no cross examination on such point which fact is stated in examination in chief, that point naturally leads to making a logical judgement on the basis of circumstantial evidence and prior conclusions rather than on the basis of direct observation that the other party accepts the truth of the statement.

When the evidence given by a witness is as such unreliable and on the face of it is not acceptable his non cross examination cannot gather believability.

Failure to cross examine will not always amount to an acceptance of the witness’s testimony, when the story incredible with the romantic character which tells by the witness during the cross examination.

The specific fact that the witnesses examined by the opposite party have not been effectively cross examined, does not mean that the Court is not liable to accept their evidence. Courts are not prevented from assessing the truth of witnesses in the absence of any cross examination.

No opportunity is given to cross examine a witness.

If there is no such opportunity is given to cross examine a witness his proof must omit from consideration. The evidence of witness is not produced for cross examination but examined before the charge is framed is not admissible.

In Union of India v. T.R Verma, it was held that if in the deposition of the witnesses, there was no cross examination because there was no record made, it can be said that, in fact, the party entitled to cross examine did not cross examine and not that the opportunity to cross examine was not admitted. But there are five exceptions in this rule:

1. Where the witness had noticed early.
2. Where the story itself is of unbelievable or romantic characters.
3. Where the non cross examination is from the motive of fineness.
4. Where the counsel indicates that the witness is not cross examined to save time.
5. When some witnesses are examined on the same point, there is no need to cross examined all the witnesses.

Misleading questions

Any kind of misleading questions cannot be allowed during the cross examination of witnesses.

Effect of witnesses not presenting for cross examination.

If any witness examined in the examination in chief but does not appear in the cross examination then his evidence becomes valueless and cannot be examined further.

In Harpal Singh v. Devinder Singh, it was held by the Supreme Court that prosecution has prudence not to examine certain witness so that proliferation of proof is avoided. Opposite illation cannot be drawn from non examination of material evidence.

Tendering a witness for cross examination

Offering a witness for practice cross examination only is illegal, bad and invalid. This amounts to a failure of the prosecution to examine the particular witness at the trial.

There is no provision in that Act for permitting a witness to be offered for cross examination without his being examined in chief and this practice is against the Section 138 of the Act. The material witness should be examined and then he may be cross examined.

An offer of a witness for cross examination amounts to giving up the witness by the prosecution as it does not choose to examine him in chief. Non examination of witness in chief examination seriously affects the believability of the prosecution case.

Examination and cross examination must relate to relevant facts

It need not be troubled that the cross examination and examination in chief must relate to relevant facts. The irrelevant fact cannot be allowed to be brought on record either by cross examination or by examination in chief.

Mode of recalling and cross examining of witness

If defence thinks for recalling the witness then the defence can request for recalling of witness, after getting a sanction of Court provided the cross-examination is for challenging the honesty on strength of alleged former statement which came on record at a later stage.

Power of the Court to control the examination of a witness

An examination of witnesses which are relatively long in duration putting irrelevant questions only to increase the size of the record is to be made less hopeful. It is an action that an abuse of this kind, which hugely increases the costs of litigation without any corresponding benefit to the parties should be checked.

Cross examination is one of the most important processes for the interpretation of facts of a case and reasonable parallel should be allowed, but the judge has to act freely as far it may go or how long it may continue. A fair and reasonable exercise of this discretion by the judge will not generally be questioned by an appellate Court.

Court proceeding must always be controlled by the judge of the Court. On the one hand the right of cross examination must be carefully restrained, and it must be remembered that it may be essential as how for an advocate to approach exquisitely and with caution the point upon which he is seeking to obtain admission. It may be important that a witness whom he does not regard honest should not be put on his guard by immediate demonstration of the case set up by the opposite party. If questions are framed in too pointless a form he may easily deny them. Hence, the large latitude is attractive since the admission sought to be induced only be forthcoming when the witness, if he is revealing something thrown off his guard and there are cases in which it is essential to drop a particular issue in the course of cross examination and to unturn to it again with discretion at a later stage. Lengthy irrelevant cross examination has to be stopped on the other hand.

A Court should take a firm stand that the witness should know and comprehend the nature or meaning of the question put before an answer has to be recorded. A Court would not work in a limited time period during the cross examination. 

Re examination

The party re examine the witness who called the witness may if he likes and if it be essential. The re examination must be confined to the explanation of matters grow in cross examination. The proper intention for re examination is by asking questions as may be proper to pull forward and explanation or meaning of expression used by the witness in cross examination, if they are questionable. New matters may be introduced only by the permission of the court, and if that is done, the opposite party has a right to cross examine the witness on that point.

In re examination of witness examination in chief cannot be added to the very end by starting totally new facts for the first time. The intention of re examination is only to get the clarification of some questions created in the cross examination.

Any number of questions

There is no limitation that re examination should be limited to one or two questions and if the urgent situation requires any number of questions can be asked in re examination.

Hypothetical questions should be disallowed.

Hypothetical questions may be put to an expert as per Section 45 of the Act. But hypothetical questions cannot be put to ordinary witness during the examination of witnesses. Courts cannot allow hypothetical questions to the ordinary witness.

Section 139 of the Indian Evidence Act

Cross examination of person called to produce documents

“A person summoned to produce a document does not become a witness by the mere fact that he produces it, and cannot be cross examined unless and until he is called as a witness.”

If a person has the document in his possession then person is summoned only to produce a document, he may appear in Court and produce the documents. He may inform the Court by an application stating that he has no possession of the document if the document summoned is not in his possession. Summon has been issued to a person even if a person produces the document to that summon. Section 139 of Indian Evidence Act clearly provides that he does not become a witness by the simple fact that he produces it and he cannot cross examined unless he is called as a witness. If the person has not produced the documents then the Court cannot record the statement of such person on oath to satisfy itself regarding the whereabout of the document. 

Section 140 of Indian Evidence Act

Witnesses to character may be cross examined and re examined.

Scope

The character of a party to a civil suit cannot be relevant to decide an issue in that suit under Section 52 of Indian Evidence Act. The good character of the accused is relevant in criminal cases under Section 53 of Evidence Act. Under Section 54 in criminal cases the bad character of the accused is irrelevant but when the evidence of his good character is given, the evidence of bad character becomes relevant. Under Section 55 of the Evidence Act where the character of a person is such as to affect the amount of damages which he should receive it is relevant. The person who gives the testimony regarding the character of a person may be cross-examined and re examined, the act of causing something to move up and down with quick movements his credit. The character evidence helps the Court to estimate the value of evidence given against the accused in criminal cases.

In Haagen Swendress Holt C.J stated that a man is not born a jack, there must be time to make him so, nor is he shortly discovered after he becomes one. A man may be regarded as an able man this year, and yet be a beggar the next, it is unfortunate that happens to many men and this former reputation will signify nothing to him upon this event.

Section 141 of Indian Evidence Act

Leading questions

Any question which make a proposal to the answer which the person putting it wishes to receive, is called a leading question.

Scope

Section 141 of Indian Evidence Act defines “leading question”. Section 142 of Evidence Act lays down that leading questions must not be put in examination in chief and re examination without the permission of the Court. It also lays down that the court should permit leading questions in examination in chief or re examination only as to the matters which are begin, which are unchallenged or which are already been sufficiently proved in the opinion of the Court. Leading questions may be put in cross examination under Section 143 of Indian Evidence Act.

Leading questions 

A question is leading one when it point to witness the real or obligated fact which the examiner expects and desires to be confirmed by the answer. The circumstances in which the question arises determined whether a question is leading or not. Is the plaintiff your father? Have you not lived for 8 years with him? Is this man 55 years of age? Is not your name Hemant? Do you reside at Gwalior? Are you not in service of Hemant? Have you not lived for nine years with Hemant? Are the example of leading questions. The examiner clearly suggests the answer to these questions. In such questions the examiner putting the questions is really giving answer rather of receiving it from the witness. In leading questions while the examiner believe the lack of knowledge and is asking for information but he really gives the answer himself rather of receiving it. 

Generally, the answers of leading questions are given by yes or no. But it cannot be said that in order to stamp a question leading the answer to it must be as yes or no.

A leading question is that which signals to the witnesses the real or obligated fact which the prosecutor expects and desires to have confirmed by the answers leading to questions. 

Section 142 of Indian Evidence Act

When they must not be asked

If objected by the opposite party leading questions must not be asked in examination in chief, or in a re examination without the permission of the Court.

The Court shall permit leading questions as to matters which are begin or unchallenged or which have in its opinion been already sufficiently proved.

Scope 

Section 142 of Indian Evidence Act stated that leading questions should not be asked in examination in chief or re examination of they are objected to. 

The Court may give the permission of leading questions to pull the attention of the witness which cannot otherwise be called to matter under inquiry, trial and investigation. The witness must report for what he himself had seen.

Exceptions to this rule

Section 142 of Indian Evidence Act provides exceptions to the general rule stated above. By the order of the Court, examiner may put leading questions in examination in chief or re examination.

1. As to matters which are begin.
2. Which are unchallenged.
3. Matters in which the opinion of the Court have already been proved.

The Court can allow a party examining his own witness to put leading questions by way of cross examination. These are exceptions under Section 154 of Indian Evidence Act.

If objected to

It should be kept in mind that if the adverse party makes any objection, leading questions may not be put in examination in chief or re examination but such questions may be put in examination in chief or re examination if the Court overrules objection.

Matters of record 

Leading questions may be asked in examination in chief about the matters of record.

Permission of the Court 

There is no legal hurdle in putting leading questions during the examination in chief, if there opposite side does not object without permission of the Court. Need to receive permission of the Court to put leading questions whould arise only in the eventuality where the opposite side takes objection. Even if the opposite side objects, the Court has a broad prudence in allowing leading questions to be put. The second para of Section 142 of Indian Evidence Act shows that the Court has no prudence to not allow a leading question if it relates to unchallenged matters or introductory matter or matters already proved. The prudence to allow or not allow a leading question can be exercised by the Court only when such leading question relates to matters other than those recited above.

Section 143 of Indian Evidence Act

When they may be asked Leading questions may be asked in cross examination.

No misleading question in cross examination

A counsel cannot asked a question in cross examination forward that some facts have been proved or admitted. Imagine a witness appears for the plaintiff, the defendant tries to show that the witness is a driver of the plaintiff so he is a curious witness. The proper question to be asked by the defendant in cross examination would be “Are you a driver of the plaintiff?” A question “How long have you been in the service of the plaintiff?” is not proper as it take for granted that the fact the witness is a driver of the plaintiff has either been proved or it has been admitted by the witness.

Imagine, the case of a wife against her husband is that he misbehaves and beats her but the husband did not accept the allegation. The husband appears in court for not accepting the allegation. The cross examiner cannot asked a question “May I ask if you have left off beating your wife?”, this type of questions are misleading.

Section 144 of Indian Evidence Act

Evidence as to matters in writing

Any witness may be asked although under examination whether any contract grant or other temperament of property as to which he is giving evidence was not controlled in a document and if he says that it was or if he is about the opinion of the Court ought to be produced the opposite party may object of such evidence being given until such document is produced or facts have been proved which entitle the party who called the witness give secondary evidence of it. 

Section 145 of Indian Evidence Act 

Cross examination as to previous statements in writing 

As per previous statement made by a witness may be cross examined in writing or decreased into writing and relevant to matter in question without such writing being proved or shown to him but if it is calculated to negate him by writing his attention before the writing can be proved to be called to those parts of it which are to be used for the purpose of negate him. 

Scope 

Challenge the honesty or truth of the credit of a witness by cross examination comes under Sections 138,140,147,148 and 154 of Indian Evidence Act. The procedure by which a witness may in cross examination be contradicted by his previous statement of writing or decreased into writing provided under Section 145 of Indian Evidence Act. Whether witness made a previous statement in writing or decreased into writing relevant to the matter of issue different from his present statement without such writing being shown to him or proved he may be asked in cross examination. But if it is intentionally to contradict him by writing his attention must be tried to it.

Rarely a person makes a certain statement which is in writing. Afterward he makes a statement different to what he has previously stated in the same case of proceeding. The present statement of the witness may be contradicted by previous statement to show that he is not speaking the truth under Section 145 of Indian Evidence Act.

Use of the previous statement

Under this Section a previous statement which contradicts a witness is not be used as substantive evidence in the case of the facts contained therein. The purpose of previous statement with contradict is to prove that the statement made in the Court is not reliable. The previous statement is not accepted as true. The one merely waste the other.

Cross examination as to previous statement

If the previous statement without showing him the writing is relevant to the matter in issue then witness may be cross examined. Witness with reference to his previous statement on the ground that the document which contained the statement is not being produced at the time of cross examination then the Court cannot refuse to allow the cross examination of witness.

Intended to contradict

As seen above on the basis of previous statement in writing relevant to the matter in issue without the writing being shown him a witness may be cross examined. But if it is intended to contradict a witness by the writing his attention must before the writing can be proved to be tired to those parts of which are to be used for the purpose of contradicting him.

Attention must be called 

The Section stated that if the previous contradictory statement of a witness is calculated to be proved his attention must be called to it. The aim of this procedure is to give the witness a chance of explaining his statement before the contradiction can be used as evidence. If this opportunity is not given the contradictory writing cannot be placed on the record as evidence.

Previous admission to contradict 

If the previous admission are clear can be used without a face and even if the makers are not produced in the Court.

Relevant to the matter in issue

Chapter II of Indian Evidence Act 1872 must be relevant with the previous statement with which it is intended to contradict a witness.

Of the witness himself

The witness who is being cross examined the previous statement of the witness must be comes from there. Ram was employed by Shyam to write Ram’s accounts books. Shyam supplied Ram with necessary information. In this case Ram cannot be contradicted with the entries in the account books, it is not his statement rather it is the statement to Shyam. Previous statement of a party not to contradict his witnesses and can be used only to contradict him.

Previous statement not substantive evidence

A previous statement used to contradict a witness does not become essential evidence and only serves the purpose of throwing uncertainty on the truth of the witness.

Section 146 of Indian Evidence Act 

Questions lawful in cross examination

When a witness is cross examined he may in addition to the questions hereinbefore mentioned to be asked any questions which given

1. To test his truth;
2. To find out who he is and what is his position in life; or
3. To shake his credit, by injuring his character, while criminate him, or might expose him to punishment or forfeiture.

Scope

Section 132,138,146,147 and 148 of Indian Evidence Act cover the full range of questions which can be put in good order to a witness. Cross examination must relate to relevant facts under Section 138 of the Act. “The examination and cross examination of a witness must relate to relevant facts” runs as per second para of Section 138 of Indian Evidence Act. The words in Section 146 “in addition to the question hereinbefore mentioned to” have reference to the para of Section 138 mentioned above. 

To test his veracity 

A witness may be cross examined not only as to the relevant facts but also as to all facts which fairly run to affect the believability of his testimony. The statements of a witness being of their nature it is right to subject them to document charging a public official with misconduct in the proper ways. So it is capable to the parties to ask about any question in cross examination which he may see important to test the truth of the witness. A witness may always be subjected to an exact cross examination as a test of his truth his understanding his unity his basis and his means of judging.

To discover who he is and what is his position in life

It is a common pattern to make research into the relationship of the witness with the party on whose behalf he is called social and family and business also to research as to his feeling towards the party against whom his testimony is being given. This is tolerable in order to place testimony in a proper light with reference to prejudice in prefer of one party or bias against the other.

To shake his credit by injuring his character

In deciding the relevancy of character as moving the credit to be given to a witness the first question is what kind of character is relevant? Wheather bad moral character in general or some other general bad quality in particular is acceptable. Sometimes it is argued that bad specific character necessarily involves an impairment of the truth telling capacity. 

Section 147 of Indian Evidence Act

When witnesses to be compelled to answer

If any such question connected to a matter applicable to the suit or proceeding the provision of Section 132 shall apply to that.

Scope 

The word ‘such’ in this Section mentioned in the last clause of the above Section. Relevancy of character is of double: it may be directly to the point in its bearing on proving or proving to be false the very virtue of the points in issue. If any witness is asked a question in cross examination about his character and that character is directly to the point in proceeding the witness is not secured from answering under Section 147 of the Act. He will have to answer the question all the same that the answer may accused him because Section 132 is made relevant to this case. Where questions are asked to a witness not for the intent of proving or proving to be false a point in issue but entirely and merely to show what is the character of a witness. The Court is to determine whether the question is to be answered or not as per the rules given under Sections 148,149 and 150.

Section 148 of Indian Evidence Act 

Court to decide when question shall be asked and when witness compelled to answer

If any such question about to matter not applicable to the suit or proceeding excluded in so far as it impacts the credit of the witness by injuring his character. The Court shall determine whether or not the witness shall be obliged to answer it. In exercising its prudence the Court shall have consider the following considerations:

• Such questions are proper if they are of such a nature that the truth of the statement attributing something dishonest conveyed by them would seriously impact the idea of the Court as to the believability of the witness on the matter to which he certify.

• Such questions are incorrect if the statement attributing something dishonest which they convey about to matters so remote in time or of such a character that the truth of the statement attributing something dishonest would not impact or would impact in slight degree the idea of the Court as to the believability of the witness on the matters to which he certify.

• Such questions are incorrect if there is a great disproportion between the importance of the statement attributing something dishonest made against the witness’s character and the importance of his proof.
• The Court may if it sees fit pull from the witness’s refusal to answer the illation that the answer if given would be critical.

Putting of indecent questions

Improper and disgraceful questions can be put if they connect directly to the fact in issue and also if it is essential to be known in order to decide whether or not the facts in issue existed, the freedom are critical and if the Court is contented that even a disgraceful question may have bearing the same cannot be prohibited.

Principle

As seen supra when character is about to issue witness has to answer it: but if the character is about to shake the credit of the witness it shall be in the prudence of the Court to allow or not allow the question. It is essential to make sure provision against a rush and unforgiving cross examination. It would be great adversity if every person who came forward to give evidence was likely at the feeling of unscrupulous cross-examiner to have every detail of his private life dragged into the light and to be obliged to answer all the questions which are asked only to defame him.

Section 149 of Indian Evidence Act

Question not to be asked without logical grounds

No such question mentioned in Section 148 should be asked unless the person asking it has logical grounds for thinking that the statement attributing something dishonest which it conveys is well founded.

Illustrations 

(a) A barrister is teach by an attorney or vakil that an important witness is a kidnapper. This is a logical ground for asking the witness whether he is a kidnapper. 

(b) An Advocate is informed by a person in Court that an important witness is a kidnapper. The informant on being questioned by the Advocate gives a satisfactory reason for his statement. This is a logical ground for asking the witness whether he is a kidnapper.

(c) A witness, of whom nothing whatever is known is asked at random whether he is a kidnapper. There are no logical ground for the question.

(d) A witness, of whom nothing whatever is known, being questioned as to his mode of life and means of living, gives disappointing answer. This may be logical ground for asking him if he is a kidnapper.

No disgraceful question without grounds

No disgraceful question should be asked unless there are logical grounds to believe them to be true.

Section 150 of Indian Evidence Act

Procedure of Court in case of question being asked without valid grounds.

If the Court is thought that any such question was asked without valid grounds, it may, if it was asked by any barrister, attorney, vakil or pleader, describe the circumstances of the case to the High Court or other authority to which such barrister, attorney, vakil or pleader is subject in the exercise of his profession.

Section 150 is penal

Section 150 is the punishment that may secure against reckless cross examination, if the Court thought that the questions were asked without valid grounds.

Section 151 of Indian Evidence Act

Indecent and disgraceful questions

The Court may disallow any questions or inquiries which it considered indecent or disgraceful, although such questions or inquiries may have some interconnection on the question before the Court.

Section 152 of Indian Evidence Act.

Question calculated to insult or irritate

The Court shall not allow any question which look to it to be calculated to insult or irritate, or which, though proper in itself, appears to the Court needlessly offensive in form.

Scope

Under Section 149 no question as mentioned in Section 148 of the Evidence Act ought to be asked unless the person asking it has some valid grounds for encouraging the statement attributing something dishonest which it conveys to be true. Question may be asked for which there are only valid grounds for thinking that the statement attributing something dishonest controlled in them are all well founded and it is by no means necessary before the question is asked that the person asking it should be in a place to constitute the truth of the statement attributing something dishonest beyond all uncertainty.

The Court cannot disallow indecent or disgraceful questions if they are about to fact in issue. If they have, however, but some interconnection and may disallow them. Where a question is calculated to insult or irritate or through paper in itself, appears to the Court needlessly offensive in form, the Court must be between for the protection of the witness.

Section 153 of Indian Evidence Act

Exclusion of evidence to contradict answers to question testing truth.

When a witness has been asked and answered any questions about the inquiry only in so far as it be given to shake his credit by injuring his character, no proof shall be given to contradict him, but if he answers falsely, he may after that be charged with giving false evidence.

Exception 1. If a witness is asked whether he has been at an earlier time acquitted of any crime and not admitted it, evidence may be given of his previous acquittal.

Exception 2. If witness is asked any question attending to challenge the honesty or truth his impartiality, and answer it, by denying the facts advised, he may contradict. 

Principle

It is obvious that question asked but to disrepute a witness by injuring his character introduce matters completely foreign to the inquiry and that if arguments about matter so introduced is allowed the Court would be occupied with determining not the merits of the case but merits of the witness and thus case might be indefinitely secure. 

Scope

Where a fact inquired after is related to the issue. And for example the character of a witness the advocate must be disputed or made the object of contention or competition with the answer which the witness chooses to give. If he denies the statement attributing something dishonest the answer is conclusive for the purpose for the case.

Evidence to contradict relevant facts

Where a fact which about as having direct interconnection at the issue is denied by a witness, it may surely be proved by irrelevant evidence, and his answer may thus be contradicted by independent evidence. So the statement of a witness for the defence that a witness for the prosecution was at a particular position at a particular time and accordingly then he would not have been at another position, where the latter states he was and saw the accused person properly acceptable in evidence.

Section 154 of Indian Evidence Act

Question by party to his own witness

The Court may in its prudence permit the person who calls a witness to ask any questions to him which might be asked in cross examination by opposite party.

Nothing in this Section shall deprive entitlement to the person so permitted under sub Section to trust on any part of the evidence of such witness.

Principle

A witness is generally force out to state in favour of the person producing him. He will mostly not be given to state anything good to the opponent if he can help it. It is, therefore, allowed that the opponent in order to unravel the truth, may cross-examine the witness, ask leading questions and challenge the truth under Section 145 and 146. 

Scope

This Section allows a party the permission of the Court to cross examine his own witness in the same way as the opposite party. Such cross examination means that he can be put.

1. Leading question under Section 143 of the Act.
2. Questions about his previous statement in writing under Section 145 of the Act.
3. Questions to be given to test his truth, to discover who he is and what is his place in life or shake his credit under Section 146 of the Act.

Ask any questions

It is not cross examining his own witness but with the permission of the Court, it is putting him leading questions. This is not like cross-examining. There are two observations which is stated by the CJ Rankin. First, the reason why Section 154 does not say a party may cross-examine his own witness with the permission of the Court is simply that this would in strictness be a contradiction in terms. The second observation is that while asking of questions in leading form is not essentially equivalent to cross examination, there is no uncertainty as to the power of a judge to give leave to ask a leading question to one’s own witness. 

Adverse or hostile witness

Under this Section the party calling a witness may with the permission of the Court, ask leading questions and cross examine him. It frequently occurs that a witness who has been called in the outlook that he will speak to the existence of a specific state of facts, pretends that he does not remember those facts or force out entirely different to what he was awaited to depose. In such cases questions rises whether by the deal of the witness the party producing him is eligible to cross examine.

Prosecution witness when can be declared hostile

A prosecution witness can be announced when he contract from previous statement made under Sections 161 or 164, Cr.P.C. Besides this when a prosecution witness turns hostile by stating something which is harmful to his prosecution case, this prosecution is eligible to get this witness announced hostile.

Cross examination without pronouncing hostile

Before the party calling the witness can cross-examine him it is not essential that the witness should be pronounced hostile. Questions of cross examination can be permitted by the Court to be asked the party calling him even though the witness does not show to be hostile. When the opposite party has evoked new matter, in cross examination, from a witness the Court may allow the party examining the witness to test his truth.

Permission of court 

Witness must obtain the permission of the Court, before the party calling the witness can cross examine him. The allotting of permission is entirely the prudence of the Court. The prudence has to be exerted with caution. Without sufficient reason it should not be exercised. It is not possible to establish a hard and fast rule.

It is to be liberally exercised, whenever the Court from the witness’s behaviour, temper, attitude, interconnection or the tenor and disposition of his answers from the studying of his previous inconsistent statement or otherwise thinks that the grant of such permission is advantageous to pull out the truth. 

Value of the evidence of a hostile witness

Hostile witness’s statement can also be examined to the extent it supports the prosecution case. In case of evidence of a hostile witness, the Court has to act with a greater degree of care and caution to secure that justice alone is done. The proof so advised should unequivocally point towards the guilt of the accused. The fact that a witness is treated under Section 154, Evidence Act, even when under that Section he is cross examined to disrepute, in no way warrants a direction to the jury that they are bound in law to place no reliance on his proof or that the party who called and cross examined him can take no benefit from any part of his evidence.

Failure of prosecution to seek declaration related to hostile witness

When the prosecution failed to look for permission of the Court to declare his witness “hostile” his evidence alternatively of supporting the prosecution supported the defence, there was nothing in law to prevent the defence to trust on the evidence of such witness and his evidence was binding on the prosecution.

Section 155 of Indian Evidence Act

Impeaching credit of witness

The credit of a witness may be challenged for the honesty or truth in the following ways by the opposite party or with the permission of the Court by the party who calls him.

1. By the evidence of persons who take the stand that they from their knowledge of the witness believe him to be undeserving of the credit.
2. By the evidence that the witness has been corrupt or has accepted the offer of a bribe or accept any other corrupt incentive to give this evidence.
3. By evidence of previous statements variable with any part of his evidence which is liable to be contradicted.

Scope

Section 155 of the Act orders for challenging the honesty or truth for credit of the witness. Sections 138,140,145 and 154 provide for challenging the honesty or truth for credit of a witness by cross examination. Section 146 permits questions injuring the character of a witness to be asked to him in cross examination. Section 155 make a different method of discrediting a witness by allowing independent evidence to be led. This Section make four different ways in which the credit of a witness may be challenged the honesty or truth.

Clause 1

Independent proof may be given that a witness examined by the opponent bears such a general reputation for untruthfulness that he is undeserving of credit. The witness must be able to state what is normally said of the person by those among whom he lives.

Clause 2

Independent proof may be given to prove that the witness has been corrupted or has accepted the offer of a bribe. But it should be call back that where the witness in question has been but offered a bribe. No illation of any sort as to the testimony of the witness can be drawn. But demand of bribe by the witness should be proved. 

Clause 3 

Under clause (3) the credit of a witness may be challenged the honesty or truth by evidence of his previous statement with any part of his statement before the Court.

Is the witness to be cross examined

If a witness intentionally to be contradicted with his previous statement in writing, the attention of the witness must be drawn to it. Though under the terms of the present Section it is not essential to cross examine and face the witness by the previous oral statement, before it can be proved, yet it is both common and better and just to be the witness to first interrogate him just give him a chance to explain if he can.

Section 145 and clause(3) of Section 155

Under Section 145 of Indian Evidence Act a witness can be cross examined and opposed only with that previous statement which was made in writing or was decreased to writing. That Section is not relevant to oral previous statements. The clause(3) of the Section is so give voice that statements, written or verbal, may be used to challenge the honesty or truth the credit under it but where the previous statement is in writing the provisions of Section 145 should be followed.

Section 52 and 155

Sections 155 and 52 deal with different matters. Section 52 disallow character evidence in consider to subject matter of the suit. Whereas Section 155 dictate the manner of impeaching the credit of witness. Section 155 cannot therefore be interpreted as an exception to Section 52.

Tape recording 

Tape recording is admissible under Section 155 sub clause(3) to challenge the honesty or truth the credit of the witness. Before taped statement can be trusted upon the time and place and accuracy has to proved.

Section 156 of Indian Evidence Act

Questions tending to substantiate evidence of applicable fact, admissible

When a witness whom it is calculated to confirm gives evidence of any relevant facts, he may be questioned as to any other circumstances which he discovered at or near the time or place at which such applicable fact happened, if the Court is of the opinion that such circumstances if proved would confirm the testimony of the witness as to the applicable fact which he testifies.

Section 157 of Indian Evidence Act

Previous statements of witness may be proved to confirm latter testimony as to same fact

In order to confirm the testimony of a witness, any previous statement made by such witness connecting to the same fact, at or relate the time when the fact took place, or before any authority legally able to investigate the fact, may be proved. 

Scope

This Section allows a witness to confirmation by evidence that he said the same thing on the previous occasion, the only condition being that his previous statement shall have been either about the time of the happening or before effective authority. The force of any confirmation by means of previous pursuant statement obviously depends upon the truth of proposition that he who is pursuant deserves to be believed.

Conditions for admitting statements

The previous statements made under either of the two following conditions may acknowledged for confirmation under this Section.

1. The statement must have been made at or around the time when the fact took place.
2. It must have been made before any authority legally effective to investigate the fact. 

At or about the time

This Section provides an exception to the general rule of excluding indirect evidence and so in order to bring a statement within the exception the duty is cast on the prosecution to abolish by clear evidence to nearness of time between taking position of the fact and the making of the statement. There can be no fast and hard rule. The main test is whether the statement was made as early as can fairly be awaited in the circumstances of the case, and before there was an opportunity to be a tutor to someone or intermixture. The word “at about the time” must mean that the statement must be made at once or at least presently after when a fair opportunity for making it presents itself.

Before any authority competent to investigate the fact

If the previous statement was not made at or about the time when the fact took place, it must be shown to have been made before any authority legally capable to investigate the fact. If the statement was not made at or about the time the event took place nor before an authority legally capable to investigate the fact would not be acceptable.

A statement made by a witness can be used to contradict him or impeach his credit before Commission.

A statement about a fact made on previous juncture before a Collector who had no authority to investigate the fact cannot be used under Section 157 of Indian Evidence Act.

Persons liable to investigate

The words ‘authority to investigate’ are quite and general and should not bound to police officers and investigations in technical way in which the word has been used in CPC. The Section takes competency of authority to investigate the fact not the case. The words ‘legally efficient to investigate’ does not mean only efficient under some provision of law.

The statement made to the legally efficient authority investigate the case.

Where in a case of shocking the modesty of women, DGP was legally approved by the state government of Haryana to investigate this case, the statement made by a witness to him were held to be admissible disregardless of fact that the statement was made long after the incident. The statements made by witnesses are of two categories. First is when witness made a statement to any person at or about the time when the incident happened. The second when witness made a statement to any authority legally capable to investigate the matter. These statements are acceptable no matter it is made long after the incident. The statement made to non authority loses its important value due to lapse of time.

The statement communicated to others.

Something that is stated and the element of communication to another person is not essential becomes a statement under Section 157 of the Evidence Act. Hence the notes of attendance processed by a witness about the conversation that took place between him and other prosecution witnesses in connection with misappropriation made by the accused would be statement within the meaning of Section 157 of Evidence Act.

Witnesses to be confirmed need not to say in Court that he made the previous statement

There is nothing in the Section 157 which demands that before the confirming witnesses depose to the previous statement, the witness to be confirmed must also say in his testimony in Court that he had made that previous statement to the witness who is confirming him. Of course if the witness to be confirmed also says in his testimony that he had made the previous statement to someone, that would add to the weight of the evidence of the person who gives the evidence in confirmation, just as if the witness to be confirmed says in his evidence that he had made no previous statement to any body that makes the statement of any witness coming into Court as a conforming witness as to the previous statement of little value. Merely in order to make the previous statement admissible under Section 157 of Indian Evidence Act it is not essential that the witness to be confirmed must also, besides making the previous statement at or related to the time the fact took place says in his testimony that he had made the previous statement. 

Time for giving confirming evidence

Ordinarily before confirming evidence is admissible the evidence sought to be confirmed must have been given. It is questionable whether Section 136 gives the Court any discretion to allow evidence to confirm a witness to be given under Section 157, before the witness, himself is examined. The Court has, no question, a discretion to allow evidence to be given under Section 157 out of the regular order, merely these discretion should not be often used and only for very special reasons.

Section 158 of Indian Evidence Act

What matters may be proved in connection with proved statement relevant under Section 32 and 33.

Whenever any statement, relevant under Section 32 and 33 is proved all matters may be proved, either in order to contradict or to confirm it, or in order to challenge the honesty or truth or confirm the credit of the person by whom it was made, which might have been proved if that person have been called as a witness and had not admitted upon cross-examination the truth of the matter suggested.

Scope

The statement admissible under Section 32 and 33 are exceptional cases and the evidence is only acknowledged from the impossibility, improbable ness or great inconvenience of producing the authors of the statement. It is just therefore, that all the same safeguards for truth should be provided as if the authors of the statements themselves before the Court and subjected to oath and cross-examination. So with consider to the impeachment of witnesses, the general rule applies where the witness whose testimony is attacked is dead or absent. This Section places a person whose statement has been used as proof under Section 32 in the same category as a witness actually produced in Court for the purpose of contradicting his statement by a former statement made by him.

Section 159 of Indian Evidence Act

Refreshing memory 

A witness may, while under examination, refresh his memory to any writing made by himself at the time of the transaction regarding which he is questioned, or so soon afterwards that the Court regards it likely that the transaction was at the time strong in his memory.

The witness may also mention any such writing made by any other person, and read by the witness within the time aforementioned, if when he read it knew it to be correct.

When witness may use copy of document to review his memory

Whenever a witness may review his memory by reference to any document, he may, with the permission of the Court to mention a copy of such documents. Provided the Court be satisfied that there is enough ground for the non-production of the original.An expert may review his memory by reference to professional treatises.

Refreshing memory by witness 

A witness allowed to review his memory, about anything upon which he is questioned, may review by means of writing. It is not essential that the document, used for refreshing memory should be relevant. It should be kept in mind that for refreshing memory the document or writing may not be admissible but facts tested to be proved must be admissible under this Section.

Writing includes printing, lithography and photography, etc

The word ‘writing’ has been defined in the General Clauses Act as ‘Aspect referring to ‘writing’ shall be made as including references to printing, lithography, photography and other modes of representing or multiplying words in a visible form’ from this, it is clear that if the status of Section 159 are satisfied a witness can refresh his memory by writing, photography, lithography, printing or other modes of representing or multiplying words in a visible from.

A newspaper 

As seen above a witness can review his memory by a printed matter. A witness attended a meeting, learned the speech of one Ram Chandra. The next day, the witness read the report of the speech in the newspaper. He found it be right. It was held that the witness could review his memory, at the time of his examination, by profounding into the newspaper. 

Tape-recorded statement

As seen above writing includes photography, printing, lithography and other modes of representing or multiplying words in visible from (Section 3(65), General Clauses Act). The word ‘in visible from’ not include the possibility of tape-recording being a “writing”. The tape-recording, not being a writing cannot be used for reviewing memory by witness.

Documents not produced at the proper time

In the case of Jivan Lal Dage v. Nitmani, the brothers of the plaintiff were not produced at the proper time. The Court declined the plaintiff to produce his account books but permitted him to review his memory by looking in the entries of them. It was held by the privy council that the evidence was acceptable under Section 159. A document which is not in the list of documents as needed by Order VII, Rule 13 of the CPC may be used for reviewing memory. Papers filed late may be used to review the memory.

Refreshing memory by any witness

The Section does not look at thoughtfully any particular or special sort of document fulfilling the situations of Section 159 may be used for the purpose. Memorandum kept by the witness of some transactions through the accounts were not on a regular basis kept, were permitted to be used for refreshing memory.

At the time of transaction or soon after it 

Before a witness is permitted to review his memory from any writing made by him, the demands of Section 159, Evidence Act should be followed with. It must be shown that the writing was made by the testifier at the time of the transaction or so soon after that the Court regards it likely that the transaction was at the time good in his memory. A doctor, when he comes into the witness-box was given a slide of paper by a pleader. After looking at the slide the doctor deposed that he examined the complainant and found injuries on his person. He did not depose as to what the slide of paper was when it was made. It was held that the proof was not admissible.

A witness can review memory about the facts stated by him if the writing was made either at the time of the transaction or presently after the transaction.

Writing made by some other person

A writing made by another person may be used for reviewing his memory by a witness if he read it soon after the preparation of writing and when he read it he knew it to be correct. From this, it cannot be deduced that the witness can review his memory by any writing made by a third person. In order that the writing of a third person may be used for reviewing his memory, the witness must have the first hand knowledge of the facts decreased in writing. The transaction occurs before the witness but alternatively of the writing being made by himself it is made by some other person and the witness reads it within the time when the transaction is fresh in his memory and while reading it he knew it to be correct. Is this were not so, an indirect evidence will creep in adopting the method laid down in Section 159.

It is essential that the document should be prepared in the presence of the witness. The document should be prepared by another person and in the absence of the witness. It is necessary that the witness should have read it soon after the transaction and knew it to be correct. In the case of Ram Chandra v. Emperor, the witness stated that he perceived the appellant’s speech and that the next morning he read a report on account of that speech in the Bande Mataram Newspaper of that date. The witness tried to review his memory by looking at the newspaper of that date. It was held that the witness was eligible to review his memory by looking at the newspaper.

Obligation of witness to refresh his memory

If there are any questions which upon any witness suffers from a bonafide oversight of memory, and that failure of memory can be repaired by reference to any memorandum or other writing made by the witness at the time and the Courts invites the witness to refresh his memory with reference to the writing, under obligation witness to do so.

A medical man 

A medical man may refresh his memory while giving evidence by referring to the report which he made but the report itself cannot be processed as evidence and no fact can be taken thereform. 

The document may not be relevant, the fact must be admissible

The writing which is used to review the memory of a witness should itself be admissible in evidence the Section does not require that. While a Panchnama was written by a police officer during an investigation, it was directly read to the Panches and admitted by them to be correct, it was held that Panches witness could review his memory by reading it. A statement recorded in writing by a police officer in the course of an investigation cannot be used in proof yet the police officer might use to review his memory. But it should be delivered in mind that for refreshing memory, the document needs to be permissible but the facts tried to be proved must be allowable in evidence. A fact which are not deserving to be admitted in evidence cannot be brought on record by means of Section 159 of the Act.

A Magistrate, during the investigation of a case, followed the accused who showed him in different places. The Magistrate made only memorandum. It was held that the Magistrate may review his memory by looking into the memorandum through the memorandum was not permissible in evidence.

Documents does not become evidence but its details may be given by refreshing memory

A document does not become an essential evidence under Section 159 of Indian Evidence Act. The witness has to review his memory by reading the memorandum and then he should force out the facts mentioned therein. The documents is not an offer in evidence. But a witness by refreshing his memory may give the details.

Contents of the record of the statement of the accused under Section 27 of Evidence Act 

Basically, a police officer should reproduce the contents of the statement made by the accused under Section 27 of Indian Evidence Act in Court by review his memory under Section 159 of Evidence Act from the memo earlier made thereof by him at the time the statement had been made to him or in his current existence and which was recorded at the same time or soon after the making of it. That would be an absolutely unexceptionable way of proving such a statement. Where the police officer blind that he does not remember the accurate words used by the accused from lapse of time or a like cause or even where he does not positively say so but it is pretty established from the surrounding portion that it could hardly be awaited in the natural course of human conduct that he could or would have accurate or dependable recollection of the same, it would be open under Section 160 of Indian Evidence Act, to the witness to trust on the document itself and swear that the contents thereof are correct.

Witness of a search list 

Search list or a Panchnama is not evidence. A witness in whose current position search was made by review his memory by the Panchnama. Only his statement is evidence. 

Recovery list on the statement of accused under Section 27 of Evidence Act

Such a list or Panchnama or memoranda can only be used by people who signed them or who made them to review their memory within the meaning of Section 159 of Indian Evidence Act. Wherever statement is ascribed to an accused person in police custody giving information leading to discovery must be proved by the witness like any other facts. The evidence about the preparation of Panchnamas of a list of discovery of a memorandum should not be permitted to depend on the cleverness of the police officer who may or may not like to write the statement in the accurate words of the accused.

No need to establish lack of recollection

For review his memory under Section 159 of Indian Evidence Act the witness need not establish a case of lack of recollection.

Section 160 of Indian Evidence Act

Testimony to facts stated in document mentioned in Section 159 of Evidence Act

A witness may also testify to facts present in such document as is present in Section 159 of Evidence Act, while he has no specific recollection of the facts themselves, if he is confirmed that the facts were correctly recorded in the document.

Principle and scope 

It has been seen that the Section 159 of Evidence Act deals with cases where the writing revives mentioned in the mind of the witness a recollection of the facts about the transaction, i.e as soon as he looks at the writing he remembers the facts. But it may be that even a studying of document does not refresh his memory, i.e it does not change his mind a recollection of facts. It is not essential that the witness looking at the written instruments should have an independent or specific recollection of the matters stated therein under Section 160 of Indian Evidence Act. Even then he may testify to the facts mentioned in it, if he recognises the writing or signature and feels sure that the contents of the documents were correctly recorded.

Difference between Section 159 and 160 of Evidence Act

The witness review his memory by looking at the document and gives his evidence in the normal way under Section 159 of Evidence Act. The document is not evidence in itself nor is it tendered. But memory is not review and while he has no specific recollections he guarantees that the paper contains a true record of facts under Section 160 of Evidence Act. Hence the evidence itself is tendered and it is evidence.

Section 161 of Indian Evidence Act

Right of opposite party as to writing used to refresh memory

Any writing mentioned under the provision of Section 159 and Section 160 of the Act must be produced and shown to the opposite party if he requires it, such party may if he delight cross-examine the witness thereupon.

Principle and scope 

This Section awards to the opposite party a right to the production and inception of, and cross-examination upon all that is made use of, for the purpose of review the memory of the witness.

Section 162 of Indian Evidence Act

Production of documents

A witness summoned to produce a document shall, if it is in his power or possession, bring it to Court, however any objection which there may be to its production or to its permissibility. Court will decide the validity of any such objection.

The Court, if it sees fit, may look over carefully the documents unless it transfer to the state or take other evidence to enable it to find out on its permissibility.

Translation of documents

If for such a purpose it is essential to cause any document to be translated, the Court may, if it thinks fit, direct the translator to keep the contents hidden, unless the documents are to be given in evidence and if the translator not follow such direction he shall be held to have committed an offence under Section 166 of the Indian Penal Code.

Scope 

The Section deals with the production of documents in answer to summons and it seems that the Section makes it irremissible on the witness to produce the document summoned by the Court and he has no right to decide whether the document shall be produced.

Validity of objection to be decided by Court 

The Court will decide the validity of any objection made by the person producing the document. This Section makes it necessary upon a witness to produce a document, if it is in his power or possession to bring it into Court however any objection which there may be to its admissibility or to its production. The Court will decide the objection.

The Section gives power to the Court to look over carefully the document or to take other evidence to enable it to find out on the issue of permissibility. But Section 162 prevent the Court for inspecting any document which transfer to the matter of state. In cases of such documents the Court must decide the point of privilege on some other material. Such documents can be inspected in proper cases.

Section 163 of Indian Evidence Act 

Giving as evidence of document called for and produced on notice

When a party calls for a documents which he has given the other party notice to produce and such document is produced and reviewed by party calling for its production, he is chained to give it as evidence if the party producing it requires him to do so.

Scope 

Section 163 of Evidence Act gives provision for the production of documents by one party to the case or proceedings on example of others.

It establishes that if a party to the proceeding summons a document from the other party and inspects it he cannot decline to produce it in the case if the party producing the paper so desires. This Section is applicable for the civil and criminal trials.

Value of such evidence 

There is no authority for the proposition that the proof which is acknowledged under Section 163 of Evidence Act must be viewed to be decisive against the party who has inspected the document. The language of the Section does not advise this. All that comes out is that the documents which the other party produced become proof in the case for what they are worth. 

Section 164 of Indian Evidence Act

Document production of which was refused on notice using as evidence

When a party refuses to produce a document which he has notice to produce after that he cannot use the document as evidence without the permission of the other party or the order of the Court.

Principle 

Where an opponent in possession of a document refuses to produce it on demand afterwards he is prohibited to produce the document to contradict the other party’s secondary proof. This is a proper punishment for unfair tactics.

Scope of the Section 

If the opponent having a document in his possession and refuses to produce it when called upon at the hearing to do so afterwards he is not at liberty to give the document in evidence for any purpose.

Section 165 of Indian Evidence Act

Power of judge to put questions production or order

The judge may in order to find out or obtain proper evidence of relevant facts and ask any question in any form at any time of any witness or of the parties related to any fact relevant or irrelevant and may order the production of any thing or document and neither the party nor their agent eligible to make any objection to such question or order without the leave of the Court to cross-examine any witness upon any answer given in reply to any such question.

The judgement must be based upon facts declared by this Act to be relevant and duly proved under this Section and shall not authorize any judge to compel any witness to answer any question or to produce any document which such witness would be eligible to refuse to answer or produce under Section 121 to 131, if the questions were asked or the documents were called for by the opposite party nor shall the judge ask any question which it would be not in proper way for any other person to ask under Section 148 and 149 nor shall he dispense with primary evidence of any document except in the cases hereinbefore excepted. 

Power of judge to put questions

A judge has a right under Section 165 of Indian Evidence Act to put questions to witnesses expressly recognised. He is awaited and indeed it is his duty to search all avenues open to him in order to find out the truth. If the judge finds that the examination of witness is not being treated in such a way as to unfold the truth it is not only his right but his duty to intervene his own questions.

Power of Court to ask questions

Judge’s part in hearing of a case is to hearken to the proof only himself asking questions to witnesses when it is essential to clearing any point that has been overlooked or left absence to see to that the advocates behave themselves properly and keep to the rules laid down by law. It is the duty of a judge to find out the truth and for that purpose he may ask any question and in any form at any time of any witnesses or of the parties about any fact relevant or irrelevant. But this he must do without unduly trespassing upon the function of the counsel of the parties without any tips of partisanship and without coming into frighten and rowdy witnesses.

The time 

However the law permit the judge to put any question to any time normally considered proper for an extended examination is when lawyers for the parties have finished their question or at least when the lawyers examining the witness at the time is passing on to a new subject. The judge may always intervene in the course of examination by an advocate to put a question in a clear form or to have a becloud answer prevent or to clarify a witness being not fairly misled but if does more and stops advocate again and again to put a long series of his own questions, he makes an efficient examination or cross-examination impossible and disadvantage the trial from its material course.

Cross examination on answers given to the Court

The parties have no right to cross-examine any witness or answers given to the question of the Court except with the permission of the Court under Section 165 of Evidence Act. The prudence will have to be exercised judicially and commonly the judge would give the essential permission if the answer given are opposite to the party who seeks the said permission.

Section 166 of Indian Evidence Act

Power of assessors or jury to put questions during examination of witness

Cases tried by assessors or jury then jury and assessors may put any questions to the witnesses however or by leave of the judge which the judge himself might asked and which considers proper.

Conclusion

Examination of witnesses is very important for any case whether it belongs to the civil or criminal nature and both the procedural law explain the examination of witnesses. Section 135 to 166 of Indian Evidence Act explain the examination of witnesses in which act cover all the things, like who can first examine the witnesses during the examination of witnesses and what are the relevant facts that are accepted during the examination of witnesses and what are the questions asked by an advocate during the cross-examination of witnesses and what questions are not asked during the cross-examination and also tells the power of judges during the examination of witnesses and at last give the provision related to the power of the jury and assessors to asked the question during the examination of witnesses. 

References

The Law of Evidence ( Batuk Lal). 

Students of Lawsikho courses regularly produce writing assignments and work on practical exercises as a part of their coursework and develop themselves in real-life practical skill.

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When you have an Employment Visa but you resigned from that company, can you still stay on in India on your existing visa?

– Shoumendu Mukherji (Advocate)

For a comprehensive legal advice, it is best that you have the following documents handy, for reference: 

1. Your Employment Visa numbered XXXXXXXX issued on __________ and valid till __________for employment with YYYYYYYYY Company in the city of ZZZZZZZ 
2. FRRO Registration Proof upon Arrival into India
3. Passport 
4. Indian Visa Application Form 
5. Employment Contract executed with YYYYYYYYY Company and having starting date _________ 
6. Resignation letter sent to YYYYYYYYY Company (if any) 
7. Termination Letter issued to you by YYYYYYYYY Company (if any)

Employment Visas for paid work in India are of three kinds, namely: 

The E-1 (for short period paid work up to six months); 

E-2 (for paid work beyond six months) and; 

E-3 (for intra company transfers) 

The above three categories have been recently clubbed into one E-1 category. Though the nomenclature has been clubbed, however the purpose and differentiation between the three categories still remain.    

An Employment Visa is valid for the period of employment and is employer specific. As soon as the employment is terminated the Visa too loses its legal sanctity and the employee must either seek a “Change of Employer” status under the norms, or apply afresh for a new Employment Visa under a new employer. For the latter, employee would be required to leave India and make a fresh application at an Indian Embassy abroad. Dependents of the employee such as spouse and children can also obtain a dependent employment visa.        

A “Change of Employer” under an existing Employment Visa, as has been laid down by the Ministry of Home Affairs, Govt. of India, is allowed only for change of employment between a registered holding company, joint ventures, consortiums and its subsidiaries and vice-versa or between subsidiaries of a registered holding company, joint ventures and consortiums. In such cases, a communication addressed to the FRRO (Foreigners Regional Registration Office) is sufficient, subject to its approval, allowing the employee to stay on in the country further. 

It is the responsibility of the employer company to inform the FRRO of the termination of your employment / resignation with specific date. In such an occurrence the your employment visa will stand invalidated w.e.f. that date of termination / resignation as informed by the employer company. In such an instance you will be required to leave India immediately upon getting an “Exit Visa” issued from the local FRRO office, allowing you to legally exit the country within a specified number of days.    

However in some instances, for senior executives, companies may offer ‘goodwill gestures’ even beyond the date of resignation / termination thereby allowing such employees to remain under the care of the company till termination of the Visa period so that it allows them time to look for alternative employment opportunities.  In such circumstances, it can be said that the Company is unlikely to take a prejudicial step that would affect the employee’s stay in India all of a sudden. However such circumstances are fine delicate lines. 

In the meantime, the employee can apply for a new employment visa under a new employer company as per the applicable criteria. Please also note that an employment visa is non-convertible to any other type of visa except in certain specific cases. Also do note that overstaying beyond the validity of your visa is punitive, punishable and can invite blacklisting which can seriously jeopardize your career.    

Shoumendu is an advocate practicing in the courts of New Delhi and handling Visa / FRRO issues. He can be reached out on shoumendu@smlegalco.com and +91 9910733947 

Students of Lawsikho courses regularly produce writing assignments and work on practical exercises as a part of their coursework and develop themselves in real-life practical skill.

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AIBE: Evidence Act carries 8 marks as per the latest bar exam syllabus. Find out the general principle of Evidence along with an exhaustive quiz to map your progress for AIBE.

What is the evidence? 

Once a civil or a criminal case is filed, the facts that are alleged by the parties need to be proved in Court. This is done by providing necessary ‘evidence’ (this word has its origin in the Latin ‘evidere’- ‘to ascertain clearly’). This evidence is presented before the Court at the stage of trial. 

Evidence can include anything,- all records or statements presented to the Court to establish relevant facts – e.g., statements of eye-witnesses, contracts, letters, oral statements, opinion of an expert, bank statements, etc. 

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Note that India primarily follows an adversarial system where evidence of facts must be provided by the parties to the civil / criminal dispute and the role of the judge is limited to adjudicating on the basis of the evidence provided by the parties. Unlike the inquisitorial system, the judge does not have an active duty to seek out evidence on specific matters. 

Brief overview of the Indian Evidence Act, 1872- 

• The Evidence Act (hereinafter, “IEA”) is a compressed codification of certain procedural laws, introduced with the object of enabling courts to correctly ascertain those facts which determine rights and liabilities defined by substantive law. 

• IEA is mainly divided into three parts- 

1. Relevancy of facts; 
2. Facts that need not be proved, and types of evidence; 
3. Production and effect of evidence 

• Tribunals, regulatory bodies, arbitration proceedings, consumer forums, and non- judicial proceedings (like, departmental inquiries, disciplinary proceedings, action under the laws governing any defence-service, etc.) do not follow the rules laid down in IEA. They observe compliance with the rules of natural justice, and may reflect some understanding of the general and basic principles of evidence. 
• IEA applies to both civil and criminal proceedings. 
• IEA works on the following four fundamental principles- 

Best evidence rule 

Deals with the assumption that the quality of the process of arriving at a decision depends upon the nature and character of evidence that is placed before the Court (whereas ‘BRE’ deals with rules which would regulate the process of presenting evidence in a court proceeding). 

Relevance

Indicates that judges are required to consider only relevant evidence to decide whether a disputed fact can be recorded as proved or not. (S. 5, IEA) Evidence must be confined only to the matter/s in issue. 

Admissibility 

When either party proposes to present evidence before the Court, of any fact, the Judge may enquire from such party about the manner in which the alleged fact, if proved, would be relevant. The Judge can then, admit such evidence only if he thinks that such fact would be relevant, and not otherwise (S. 136, IEA). 

Appreciation

The process which facilitates a Judge to arrive at a conclusion is called appreciation of evidence. This is a matter left to the Judge’s wisdom and experience, as it’s very difficult to encapsulate appreciation of evidence in statutory form.  

IEA classifies evidence into the following three major types- 

1. Oral and documentary evidence 
2. Circumstantial and hearsay evidence 
3. Primary and secondary evidence 

Who has the responsibility of collecting and presenting evidence before the Court?

In civil cases, it is the responsibility of the parties to the dispute to present evidence before the Court to establish the facts supporting their claims. 

In criminal cases, however, especially in respect of cognizable offences (i.e. where the complainant is entitled to file an FIR), the police is responsible for conducting an investigation (and consequently collecting evidence) after the FIR is filed, which is  presented before the Court during trial of the matter. 

Categories of evidence and proof 

What is the necessity of providing evidence?: 

Evidence must be adduced so that the Court is able to determine the disputed points in the case (called ‘facts–in-issue’ under the Evidence Act). In addition to evidence pertaining to the facts-in-issue, other evidence may be required by a Court to decide a case. 

Usually, the facts over which parties are at dispute cannot be decided in isolation without knowledge of connecting facts or surrounding circumstances. Such facts are known as ‘relevant facts’. 

Which facts are relevant?

Ss.5 – 55, IEA explain the facts which are relevant, and pertaining to which, evidence is admissible. By way of example, evidence of all facts which are per se not in issue but connected to the facts-in-issue and part of the same transaction, is admissible. This includes the motive behind perpetration of a criminal act/omission, preparation therefore, and previous or subsequent conduct; the cause or effects of the facts-in-issue, and the facts that are necessary to explain the relevant facts. (Such facts are known as res gestae in legal jargon.Ss. 6-9, IEA) 

1. 11, IEA contemplates that- 

– If certain facts are inconsistent with any relevant fact, or 

– If such facts make the existence or the non-existence of the relevant fact highly probable or improbable, then such fact/s is considered relevant even if it was irrelevant otherwise. 

What are the two most important types of evidence under the IEA? 

1. Oral evidence 
2. Documentary evidence 

Statements made by witnesses is known as ‘oral evidence’, and any document (including electronic records), stone inscriptions and engravings is known as ‘documentary evidence’. 

Oral Evidence (Ss. 59-60, IEA): 

IEA covers two broad rules regarding oral evidence- 

1. All facts except contents of documents maybe proved by oral evidence 
2. Oral evidence in all cases must be direct, and not hearsay 

Generally, the evidence of a witness is given orally, and falls under ‘oral evidence’. A witness, if unable to speak, may communicate to the Court by signs or by writing. This would also be covered under ‘oral evidence’. Oral evidence is a much less satisfactory medium of proof than documentary evidence. But justice can never be administered in many cases without resorting to it. The correct rule is to judge oral evidence with reference to conduct of parties, and the presumptions and probabilities legitimately arising in the case. The real test for accepting or rejecting such evidence is, how consistent is the story of the witness; how well does it stand the test of cross- examination; and how far does it fit in with the rest of the evidence and the circumstances of the case. Indian Evidence Act embodies the general English rule, that hearsay is no evidence (exceptions to this are dealt with in Ss. 17-39, IEA) Oral evidence should be direct, and must refer to a fact that has been seen, heard or perceived by other senses by a witness. For a person’s evidence to be admissible (as oral evidence) in Court, he must be a competent witness (S. 118, IEA). 

Documentary evidence (Ss. 61 to 65, IEA): 

Includes primary and secondary evidence, wherein the primary evidence is the document itself, and secondary evidence deals with certified copies of the original document. 

Which party has the responsibility (or ‘burden’) of proving his case?

As a general principle, the party claiming relief needs to provide evidence of the facts it has alleged (S. 102 read with S. 101). This general rule,in other words, indicates that the ‘burden of proof’ in a suit or proceeding lies on that person who would fail if no evidence at all were given on either side. 

(S. 3, IEA) When does a Court consider a fact to be: 

• Proved- 

A fact is considered as proven when the Court believes its existence to be so probable that a prudent man oughtto act upon the supposition that it exists. 

• Disproved- 

A fact is said to be disproved when the Court considers its non-existence so probable, that a prudent man ought to act upon the supposition that it exists. 

• Not proved- 

A fact is said not to be proved when it is neither proved nor disproved. 

‘Fact-in-issue’- 

Any fact from which, either by itself, or in connection with other facts, the existence, non-existence, nature or extent of any right, liability or disability, asserted or denied in any suit or proceeding, necessarily follows. 

• ‘Conclusive proof’- 

When a fact is declared by this Act to be a conclusive proof of another, the Court shall, on proof of the one fact, regard the other as proved, and shall not allow evidence to be given for the purpose of disproving it. 

It may not be possible to establish a fact with absolute mathematical certainty. However, IEA prescribes a certain degree to which a fact must be established; barring special circumstances (i.e., Ss. 56-58, IEA) 

Which facts need not be proved? 

Facts presumed by law (Ss. 86-88, IEA) [Presumptions – Regarding public documents (Ss. 79-90A), Regarding burden of proof (Ss. 111A, 113A, 113B, 114A)] _ Facts admitted (S. 58, IEA) [Admissions (Ss. 17-23, 31, 70, 167) and Confessions (Ss. 24-30, IEA)] Facts judicially noticeable ( Ss. 56, 57, IEA) 

Presumption

Presumption of law and fact- 

A presumption is an acceptance of a fact as true or existent based upon its strong probability evident from the circumstances. According to English Law, a presumption can be of two kinds – presumption of fact, and presumption of law 

Presumption of Fact- 

Presumption of fact are those presumption about things or events that happen in day to day life, which we accept as true, due to inference drawn logically and naturally by our mind. For example, presumption that a man with blood stained clothes and a knife in his hands has stabbed someone. Or, if X is found in possession of Y’s credit card, X has committed theft. Such presumptions are rebuttable from further evidence. 

Presumption of Law- 

Apart from presumptions of fact, there are situations under which presumptions may or must be made, as per legal rules. Under those situations, courts will make the presumption based on the legal rule. For example, it is a presumption of law that a child below seven years of age is not capable of committing a crime. Or that a person who has not been heard from for seven years is dead. Such presumptions may or may not be rebuttable depending on the law. For example, the presumption that a child below seven years of age is not capable of committing a crime cannot be rebutted.

Law presumes the age of the child as a conclusive proof of his innocence. But the presumption that a person is dead when he is not heard from for 7 years is rebuttable by presenting further evidence that indicates that he was alive. 

The burden of proving a particular fact is always on the party which is alleging the fact. However, there are situations when the Court is entitled to ‘presume’ the existence of certain facts. Courts are entitled to presume facts pertaining to natural events, natural course of human conduct or in the course of business. 

In such cases, proof is not required. IEA deals with presumptions about facts and presumptions of law. Let’s examine some presumptions for reference purposes below: 

• If a person has been accused of having committed any offence in a disturbed area wherein it can be shown that the person had been in a place in such area at a time when firearms and explosives were used from that place to attack or resist the forces that were working to maintain peace and order, such a person would have been presumed to have committed an offence under Section 121, 121A, 122 or 123 of IPC, and criminal conspiracy or abetment of an offence under Section 121 or 123 of IPC. 
• Section 113A indicates towards presumption of an offence with regard to the abetment of suicide of a married woman. 
• Presumption pertaining to the legitimacy of children born out of wedlock is a presumption of law. 
• Law states that a person is always innocent unless proven guilty – However, in the cases of rape, if the woman states that she did not consent to the sexual intercourse, the Court presumes an absence of consent on the part of the woman. 

Therefore, if it is proven that a person had sexual intercourse with a woman, he is considered to have done it without consent of the woman (and hence guilty of rape), unless he proves otherwise. 

Presumptions that can be made with respect to documents are discussed in Ss. 79 to 85 of the Evidence Act. 

Chapter VI, IEA deals with the exclusion of oral evidence by documentary evidence – that is, where documentary evidence is available of a particular fact, it will be preferred to oral evidence. Oral evidence will not be considered at all with respect to that fact. When the presumption is conclusive, no further evidence is required to be provided, but when it is rebuttable, the adverse party can present evidence to negate the presumption. 

To conclude, in criminal laws, it is a generally accepted theory that a person is always innocent unless proven guilty. Burden of proof is a concept that has been explained in various fields of law, be it in torts or in criminal laws. However, the basic fact that lies in the foundation of this concept, is that a person who claims the happening of an event or claims a fact, has the burden to prove it. Also, when any fact is within the knowledge of any person, that person solely has the burden of proof upon him to prove it (S. 106, IEA).

In torts, there is a concept of Res Ipsa Loquitor; whereas, in criminal law, there is a concept of prima facie. In the former, the plaintiff needs to prove three things which are, that the defendant owed a duty of care to the plaintiff that he breached, due to which the plaintiff suffered damage. After proving these, the burden of proof shifts to the defendant. However, in the latter, there is a presumption that there is enough evidence to prove the event or the fact. S. 103, IEA deals with the provisions relating to alibi. 

Domestic Violence Act has a similar provision, as that of S. 113A and S. 113B, IEA whereunder the death of a woman under unnatural circumstances, within seven years of her marriage, is presumed to be a dowry death, abetted by the deceased’s husband or relatives thereof. 

Admissions

1. 17, IEA defines an admission as a statement that suggests any inference as to any fact in issue or relevant fact and which is made by: 

– A party to a proceeding or his agent 

– Suitor in representative character 

– Party interested in subject-matter 

– Person from whom interest derived 

The tricky part in admissions relates to the provisions describing confessions (Ss. 24-30, IEA). It basically deals with the provisions that state as to whom can confessions be made to; what sort of confessions may be admitted; and what happens to the confessions that are made under threat, inducement or promise. Confessions made under such influences could be held as self-incriminatory, which is not allowed under the Constitution [Article 20 (3)]. 

A dying declaration is usually held as relevant. Just like motive, intention, ill will, state of mind and body or bodily feelings are important (according to Ss. 8 and 14, IEA); a previous good or a bad character (Ss. 52 to 55, IEA) could be relevant. However, its submission is restricted majorly to criminal cases, and has no bearing on civil cases as such. 

Judicial Notice

The court is entitled to take notice of certain facts and occurrences around the world – for example, it may take note of a comment pertaining to the state of the Indian economy, that is made by the Governor of the RBI in a public speech. Judicial notice is taken of certain matters which are so clearly established, that evidence of their existence is deemed unnecessary. If the court has taken judicial notice of a fact, it need not be proved. 

1. 56 read with S. 57, IEA mean that, if a dispute arises with regard to the facts enumerated in S. 57, IEA, the party which asserts its existence need not produce any evidence to prove the existence of such fact. (See Sections 56 and 57, Indian Evidence Act) 

Privileged Communications (Ss. 122-129, IEA)

In certain relationships communication is grounded on the basis of trust – it is assumed that such communication will not be brought in the public or disclosed in court even if circumstances change in the future and the relationship ceases to exist. Law considers it important to protect the sanctity of such communication. These communications are known as ‘privileged communication’. The content of any communication which is privileged need not be disclosed before a court. Such communications can broadly be categorised in two types- 

1. Privileged from disclosure (privilege may be understood as ‘restricted compellability’ as regards certain witnesses who are competent to depose, and may also be compelled to do so under ordinary circumstances, but are not forced by law to do the same for specific matters which are considered privileged.) 

2. Prohibited from disclosure – This category of privileged communication cannot be disclosed at all in court. 

Section 122, IEA- 

Provides that a married person shall not be compelled to disclose any communication made to him/her during marriage by anyone to whom he/she is or was married (‘privilege of witness’). Such disclosure shall not be permitted, except when the person who made it, or his representative-in-interest consents; or in suits between married persons; or in proceedings where one married person is prosecuted for any crime committed against the other (‘privilege of spouse of the witness’). 

Section 126-129, IEA- 

Explain the law relating to professional communications between clients and legal advisers (or their clerks). However, when such communication is in the form of writing, and made known to others, there’s no ‘confidentiality’ for either the client or the advocate claiming privilege under S. 126, IEA. 

Trial Process 

How is evidence provided in a Court? What are the evidentiary procedures governing deposition in a Court? Examination-in-chief, Cross-examination, Re-examination: 

Examining witnesses follows certain rules prescribed by IEA. Cross-examinations, examination-in-chief, and re-examination are allowed. The testimony of a witness is recorded in the form of answers to questions put to him. This is done to confine the testimony to the facts relevant to the issue/s at hand. This is known as ‘examination’ of a witness. 

To elaborate further, S. 135, IEA must be discussed. It lays down the order of examination of witnesses, and involves two things- 

1. Which party is to examine his witnesses first? (‘right to begin/reply’) 

In criminal cases, the prosecution always begins, but in civil matters, the right to begin is determined by the nature of issues which are framed from the pleadings, and contents of the documents produced by the parties. 

2. In what order are the witnesses to be examined by a party? 

Generally, it is the advocate who enjoys the privilege to determine the order in which witnesses should be produced and examined. However, S. 135 gives the Court, the power to dictate the order of production of witnesses. 

1. Section 137, IEA lays down the following- 

• ‘Examination-in-chief’- Examination of witness by the party who calls him. Questions with a ‘yes’ or ‘no’ answer, or those which point towards a particular state of action (called ‘leading questions’) cannot be asked. 

If, however, a witness turns hostile (S. 154, IEA), that is, the witness departs from the statement that was given to the police (the statement given to police during investigation is not admissible as evidence in Court directly, and the witness is therefore required to depose before the court at the time of trial), then, leading questions can be asked. 

• ‘Cross-examination’- Is done by the adverse party, to test the veracity of the statement of the witness and the credibility of the witness in general. S. 146, IEA discusses what sort of questions may be asked during such cross-examination. 

• ‘Re-examination’- Is done subsequent to cross-examination, and by the party which called the witness. This is done only on the facts that have been dealt with in the cross-examination. 

Section 138, IEA lays down an ‘order of examination’, whereunder a witness shall be first examined-in-chief (if the adverse party so desires), then cross-examined, and then, if the party calling the witness so desires, re-examined. 

Section 138 states that examination and cross-examination must relate to relevant facts only. However, cross-examination need not remain restricted to only those facts testified by the witness in his examination-in-chief. This order prohibits the asking of leading questions which are such questions that suggest the answer which the questioning party wants to receive.

If such leading questions have been objected to by the adverse party, they cannot be asked during cross-examination or re-examination, except with the permission of the Court (S. 142, IEA). Court usually permits leading questions in the cases where the question is in relation to undisputed or proven facts. Leading questions can be asked during cross-examination (S. 143, IEA). Also, questions irrelevant to the issue, or tending to impeach credit of the witness, are allowed in cross-examination (S. 146, IEA). 

Law of Evidence quiz 1 

1.) ‘Facts-in-issue’ are: 

A.) Agreed facts 

B.) Disputed facts 

C.) Issues framed by the Court 

D.) Facts from which the existence, non-existence, nature or extent of any right, liability, or disability, asserted or denied in any suit or proceeding, necessarily follows. 

2.) A has been accused of murdering B. What is a ‘relevant’ fact here?: 

A.) Acts done by A 

B.) Acts done right after the murder 

C.) Acts done right before the murder 

D.) All of the above 

3.) A is guilty of defaming B through libel. What is a relevant fact here?: 

A.) The defaming letters that A wrote to B 

B.) The correspondence sent between the parties before the defaming letter was sent 

C.) The defaming correspondence made available to third parties 

D.) All of the above 

4.) What is a relevant fact in the case where A has been accused of committing a crime and B, C or D could also be held guilty according to the circumstances? 

A.) That B did not commit the crime 

B.) That C was not there at the scene of the crime 

C.) That A was the one present at the crime scene and had the weapon with him 

D.) All of the above 

Law of Evidence quiz 2 

1.) When a person is bound to prove the existence of any fact, it is said that the burden of proof lies on: 

A.) that person 

B.) the opposing party 

C.) none of the above 

D.) no specific party, as this depends entirely on the circumstances of each case 

2.) The burden of proof in a suit or proceeding lies on that person: 

A.) who would win if reliable evidence were given from his side 

B.) who would fail if no evidence were given on either side 

C.) who would fail if substantial evidence were given from his opponent’s side 

D.) none of the above 

3.) The burden of proof as to any particular fact lies on that person who: 

A.) wishes the Court to disbelieve in its existence 

B.) wishes the Court to believe in its existence 

C.) would fail if no evidence at all were given on either side 

D.) both b) and c) 

4.) ‘A’, accused of murder, alleges that due to grave and sudden provocation, he was deprived of the power of self-control. ‘B’ denies this fact. 

Choose the most appropriate option from below: 

A.) The burden of proof must be shared by both ‘A’ and ‘B’ 

B.) The burden of proof is on ‘B’ 

C.) The burden of proof is on prosecution 

D.) The burden of proof is on ‘A’ 

5.) A was in a hurry to board a train. He ran to the railway station. During the train journey, the ticket officer came to check the passengers’ tickets. It was then that A realized that his ticket was missing. A is charged with travelling on the railway without a ticket. On whom will the burden of proof lie?: 

A.) On the railway authorities, as they have to prove that A was travelling without the ticket 

B.) On the passenger, as he did not have the ticket on him 

C.) The passenger should not be charged, as it can be presumed that he had the ticket but lost it because he was in a hurry to board the train 

D.) None of these 

6.)A desires a Court to give judgment that he is entitled to certain land which is in the possession of B, by reason of facts which he asserts, and which B denies to be true. 

Who must prove the facts?: 

A.) A 

B.) B 

C.) An independent investigation authority 

D.) Both a) and c) 

Law of Evidence quiz 3 

1.) Presumption as to powers-of-attorney requires authentication by: 

A.) Any Court 

B.) Magistrate 

C.) Representative of State Government 

D.) A Notary Public 

E.) a), b) and d) 

2.) Presumption as to genuineness of collections of laws and reports of decisions include: 

A.) Every book purporting to be printed under the authority of the Government of any country 

B.) Every book that has been printed in any country, containing laws of that country 

C.) Every book purporting to be published without Government’s authority, purporting to contain reports of Court-decisions and laws 

D.) All of the above 

3.) The presumption will vanish when: 

A.) The accused adduces evidence 

B.) The contrary is proved 

C.) The accused enters into defence 

D.) None of these 

4.) Presumption under S. 114 Illustration (b), IEA deals with: 

A.) Possession of stolen properties 

B.) Evidence of accomplice 

C.) Judicial and official acts 

D.) Common course of business 

5.) Court may presume that a man who is in possession of stolen goods soon after theft is either a thief or has received the goods, knowing them to be stolen, unless he can account for its possession. This presumption is contained in: 

A.) Section 114(a) 

B.) Section 114(b) 

C.) Section 114(c) 

D.) Section 114(d) 

6.) Which of the following legal provisions lay down the presumption that judicial and official acts have been regularly performed?: 

A.) Section 114(c) 

B.) Section 114(d) 

C.) Section 114(e) 

D.) Section 114(f) 

https://www.lawsikho.com/mock_tests/12015/question_paper 1/4 

11/6/2017 LawSikho 

7.) What is the effect of making a rebuttable presumption?: 

A.) The fact can no longer be proved otherwise 

B.) The party in whose favour the presumption is made, is relieved of the initial burden of proof. 

C.) The matter is said to be decided 

D.) Both a) and b) 

8.) An admission can be in which of the following forms?: 

A.) Electronic 

B.) Oral 

C.) Written 

D.) All of the above 

9.) What are the two types of admissions?: 

A.) Judicial and extra-judicial admission 

B.) True and false admissions 

C.) Oral and written admissions 

D.) None of these 

10.) There are some exceptions under which the person making an admission can prove the same. Choose the option that is not such an exception: 

A.) An admission may be proved by or on behalf of the person or making it, when it is of such a nature that, if the person making it were dead, it would be relevant as between third persons under Section 32. 

B.) An admission may be proved by or on behalf of the person making it, when it consists of a statement of the existence of any state of mind or body, relevant or in issue, made at or about the time when such state of mind or body existed, and is accompanied by conduct rendering its falsehood improbable. 

C.) An admission may be proved by or on behalf of the person making it, if it is relevant otherwise than as an admission. 

D.) All of the above are exceptions where the person making the admission can prove the admission. 

11.) A sold B, a horse. B asked if the horse was sound. A said that he should ask C about that. B goes to ask C the same, who said that the horse was okay. What would be considered as an admission in such case?: 

A.) The fact that A asked B to ask C 

B.) The fact that B asked C 

C.) The fact that C said that the horse was okay 

D.) None of the above 

12.) What is the difference between confession and admission?: 

A.) Confessions are made to police officers, while admissions to a Magistrate 

B.) Confessions are made in criminal proceedings, while admissions are made both in criminal and civil proceedings 

C.) Confession is made by the accused, while an admission can be made by anyone during the course of proceeding 

D.) Both c) and d) 

13.) There is evidence to show, that A and B murdered C. A confessed and said, “B and I murdered C.” Would this confession be held against A alone, or could it be used against B as well?: 

A.) It could be used against A and B if they were being jointly tried for murder 

B.) It could be held against A alone 

C.) It could be held against A alone, if he was being tried in isolation and not jointly with B 

D.) t cannot be held against B 

https://www.lawsikho.com/mock_tests/12015/question_paper 2/4 

11/6/2017 LawSikho 

14.) A, the captain of a ship, is tried for casting her away. Evidence is given to show that the ship was taken out of her proper course. A produces a book kept by him in the ordinary course of his business, showing observations alleged to have been taken by him from day-to-day, and indicating that the ship was not taken out of her proper course. Would A be allowed to prove these statements as relevant facts?: 

A.) No, because a person making an admission cannot prove the same 

B.) Yes, because these statements fall under S. 32(2), IEA 

C.) No, because the evidence shows that the ship was cast away 

D.) a) Yes, because the captain should be given an opportunity to explain his actions 

15.) Under Section 57(1), IEA, the Court shall take judicial notice of: 

A.) All laws in force in India 

B.) All laws including foreign laws 

C.) All laws including foreign laws 

D.) All of the above 

Answers Key of Law of Evidence quiz 3 

1.) A 2.) A 3.) B 4.) B 5.) A 6.) C 7.) B 8.) D 9.) A 10.) D 11.) C 12.) D 13.) A 14.) B 15.) B 

Law of Evidence quiz 4 

1.) Which of the following constitutes exceptions to S. 122, IEA?: 

A.) Acts apart from communication 

B.) Evidence by third person/s 

C.) Waiver of privilege 

D.) All of the above 

2.) Which of the following constitutes exceptions to S. 126, IEA?: 

A.) communications made in furtherance of illegal purpose 

B.) disclosure after death of client 

C.) crime or fraud since employment of the legal practitioner began 

D.) a) and c) 

3.) A agrees to supply B, 500 bags of rice in a month. However, A fails to do so and tells B that he could not supply the rice due to failure of crop. However, A has sold the crop to C who agreed to give A, a higher price for the same. When B starts proceedings against A, A appoints a lawyer, D, and admits his liability in a letter. A clerk at D’s office leaks this letter to X who is B’s lawyer. Will the same be admissible? 

A.) The letter will not be admissible in Court, because it has been obtained by illegal means 

B.) The letter will not be admissible in Court, because it is protected by attorney-client privilege 

C.) The letter will be admissible because it pertains to a relevant fact 

D.) The letter should be made admissible, as it establishes the guilt of A. 

4.) In which of the two fact situations is the communication between the attorney and client not protected from disclosure? 

1. I) A, a client, says to B, an attorney—”I have committed forgery and I wish you to defend me.” 
2. II) A, a client, says to B, an attorney— “I wish to obtain possession of property by the use of a forged deed on which I request you to sue.” 

A.) I is protected from disclosure, while II is not 

B.) Neither are protected from disclosure 

C.) Both are protected from disclosure 

D.) II is protected from disclosure, I is not protected from disclosure 

5.) A, being charged with embezzlement, retains B, an attorney, to defend him. In the course of the proceedings, B observes that an entry has been made in A’s account book, charging A with the sum said to have been embezzled, which entry was not in the book at the commencement of his employment. Is this entry protected from disclosure?: 

A.) Yes, as it is part of the client-attorney privilege 

B.) Yes, it is protected from disclosure 

C.) No, as the entry was made after the commencement of the employment 

D.) No, as the attorney did not make the entry 

Law of Evidence quiz 5 

1.) What sort of questions can lawfully be put to a witness during cross-examination? 

A.) Question regarding his past character 

B.) Questions that lead him to answer that he is guilty of the crime 

C.) Questions that test his truthfulness with regard to the statements he is making 

D.) Questions regarding his involvement in the crime 

2.) Can the witness be lawfully forced to answer? 

A.) No, it will lead to self-incrimination 

B.) Yes, but only while taking direct oral evidence 

C.) Yes, but only regarding matters relevant to the suit or proceeding 

D.) Yes, but only regarding the relevant facts, and for which he shall not be subjected to any penalty or forfeiture of any kind 

3.) How can a witness refresh his memory under examination? 

A.) By referring to any writing made by himself at the time of transaction 

B.) By referring to someone else’s writing, provided, he knew it to be true while reading it 

C.) By referring to a copy of a document and not the original as such 

D.) All of the above 

4.) Can a witness be summoned to produce a document? 

A.) Yes, if it is in his possession 

B.) No, if there are any objections with regards to its production 

C.) No, if there are any objections with reference to its admissibility 

D.) Yes; if such document is in his possession or power then despite objections, it can be summoned for production. It is the Court which will decide on the objections. 

5.) Does a Judge have the power to ask questions to a witness? 

A.) Yes, he does; provided, it is based on the facts that are relevant to the suit, but have not been proved 

B.) Yes, he does. But he cannot compel the witness to answer 

C.) No, only the counsels of the parties can do so, the Judge can only pronounce the judgement 

D.) Yes, he can do so at any point of time regarding any question, whether relevant or irrelevant, and no one can object to the same, provided his judgement is based on relevant facts. 

E.) e) Both b) and d) 

6.) Examination that’s subsequent to cross-examination of a witness by the party who has called him, is known as: 

A.) Main examination 

B.) Additional examination 

C.) Re-examination 

D.) Re-cross-examination 

7.) What is the meaning of ‘leading question’?: 

A.) The first question that the witness is asked 

B.) The most important question that is asked 

C.) A question that presupposes or suggests an answer 

D.) A question that the first witness is asked 

8.) When is a witness treated as a hostile witness?: 

A.) When the witness does not appear in Court due to prior commitments 

B.) When the prosecution witness states something that is destructive to the prosecution’s case 

C.) When the witness and the complainant do not share a good relationship 

D.) Both a) and b) 

9.) What does one understand by ‘examination-in-chief’?: 

A.) The prosecutor examining the witness 

B.) The witness being examined 

C.) The examination of the first witness 

D.) The examination of a witness by the party which called him/her 

10.) When a fact is stated in examination-in-chief, and there’s no cross-examination on that point, it may be inferred that the other party accepts the truth. What are the exceptions to this rule?: 

A.) where the non-cross examination is done to save time, as indicated by the counsel 

B.) where several witnesses are examined on the same points, all need not be cross-examined 

C.) both a) and b) 

D.) none of the above 

11.) A person summoned to produce a document does not become a witness by the mere fact that he produces it, and cannot be cross-examined unless and until he’s called as a witness. This rule is prescribed under: 

A.) S. 138, IEA 

B.) S. 137, IEA 

C.) S. 139, IEA 

D.) S. 146, IEA 

Answer Key for Law of Evidence Quiz 5

1.) C 2.) D 3.) D 4.) D 5.) D 6.) C 7.) C 8.) B 9.) D 10.) C 11.) C 

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Students of Lawsikho courses regularly produce writing assignments and work on practical exercises as a part of their coursework and develop themselves in real-life practical skill.

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This article is written by Shubhangi Sharma, a 5th-year student of BA LLB in Lloyd Law College, Greater Noida. The article discusses about assault as tort and its remedies.

What is a Tort?

The word tort has been derived from the word “tortum” is a Latin term which means twist. The law of tort consists of wrongful acts whereby the wrongdoers violates some legal rights vested in another person. The law imposes a duty to respect the legal rights vested in the members of society and the person making breach of that duty is said to have done the wrongful act. Violations may be due to intentional acts, breach of duty or violation of law.

The party who has committed a tort is known as tortfeasor. When a tortfeasor incur tort liability, which means that they have to compensate the victim for the harm which has caused by them. In other words, the tortfeasor will have to pay damages if he is found “liable” or found responsible for a person’s injuries. 

The law of Tort in India has evolved from the Law of torts in the UK which is most popularly known as “Judge Made Law” and the law of tort does not come from a statute and is uncodified. Despite this, it has existed for many years, although the number of cases of tort have declined. The number of cases of tort or tort litigation is less as compared to the cases of tort filed in Britain and the United States. The Indian law of tort got its shape after the principle of law of tort developed in the UK. Most of the landmark judgements of tort in India is based on the judgements of House of Lords/ courts in England. In India, the tort cases are tried in civil courts and the relief awarded includes damages by way of monetary compensation or an order of injunction or restitution. The law of Tort serves two basic, common objectives:

1. Compensation to the victim for any harm resulting from a breach of defence.
2. Discouraging the rescuer from repeating the violation in the future.

Examples of Torts

Some common examples of torts include:

1. Negligence-related claims.
2. Civil assault/civil battery.
3. Wrongful death claims.
4. Trespassing.
5. Products liability and dangerous product.
6. Intentional infliction of emotional distress.

Assault

In common law, assault is a tort, an act of the defendant which causes to the plaintiff reasonable apprehension of the infliction of a battery on him by the defendant. When the defendant creates his act by an apprehension in the mind of the plaintiff that he is going to commit battery against the plaintiff, the wrong of assault is completed. The wrong consists of an attempt to do harm rather than the harm being caused thereby. In assault charges must include conduct that is offensive which is offensive or causes another person to the fear of their safety. This clearly means that one can be guilty of assault even if he/she did not physically harm the victim. In the case of R. v. S. George, the pointing of loaded gun to another is an assault. If the pistol is not loaded, then even it may be an assault, if pointed at such a distance that it may cause injury. if a person advances the manner of threatening to use force , then there is assault. This was decided in the case of Stephens v. Myers.

Elements of Assault

If one or more elements have not been satisfied then It can be a defense to an assault charge. Elements of the crime of assault are:

An act or conduct intended to created: To prove a criminal attack, the defendants’ behaviour must be motivated to create a situation of fear or danger in the victim’s mind. Accident acts do not include allegations of assault.

A reasonable apprehension: Further, the victim must reasonably believe that the defendant’s conduct will harm or humiliate him. The victim must understand the defendant’s potentially harmful or offensive acts.

Of imminent harm: The victim’s fear must be a direct response to a threat that is imminent. Future threats, such as “I will beat you tommorrow”, will not result in assault charges. In addition, there must be some kind of perceived physical threat to the victim in the loss; For this reason, words by themselves generally do not constitute an attack.

It is believed that the defendant’s actions would cause physical danger or abusive behaviour to the victim. Thus, the pretence of kicking or punching the victim may be an attack, as will attempt to spit on the victim (aggressive behaviour).

All of the above elements must be present and the evidence must be supported with evidence if found guilty for the attack.

It can be difficult to prove whether the defendant actually intended the attack. Similarly, judges often spend a lot of time determining whether a defendant’s actions are considered harmful or abusive. In determining this, they will consider what an average person may perceive as harmful or aggressive.

Difference between Assault and Battery

Difference between Criminal and Civil Assault

Legal defenses on charges of Assault

As with other types of criminal charges, there may be some defenses to assault charges. This will depend on each individual case, as well as other factors such as state law. Faults commonly charged with assault charges include:

1. Self-defense: This could be a defense if the defendant was acting out of self-defense. They should only use the amount or display of force that is appropriate in the situation and in proportion to the force being used against them.
2. Intoxication: In some cases, intoxication can be a legal defense, especially in cases where intoxication affects a person’s ability to act intentionally.
3. Coercion: This may be a defense if the defendant was forced to attack under threat of harm (for example, if they are being held at gunpoint and for assault at the behest of someone).
4. Lack of proof / proof: As stated above, if the elements of proof are not found or supported with the correct evidence, it can serve as a legal defense.

Many other types of avoidance may exist depending on the circumstances.

Cases

Fagan v Commissioner of Police for the Metropolis

Fagan was sitting in his car when he was approached by a police officer who asked him to take the vehicle. Fagan did so, overturned his car and rolled over a police officer’s leg. The officer forcefully asked him to remove the car from his leg, to which Fagan swore him and refused to take the vehicle and shut down the engine. Fagan was convicted of assaulting a police officer in the execution of his duty. Fagan later appealed the decision. The court held that, Although assault is an independent crime and is to be treated as such, for practical purposes today, assault is generally synonymous with battery. On this basis, it was held that Fagan’s crime was not the refusal to move the car but that having driven on to the foot of the officer and decided not to cease the act, he had established a continual act of battery. This meant that actus Reus and mens rea were present and as such, an assault was committed. Fagan’s conviction was upheld.

R. V. Constanza

A man was convicted of assault occasioning actual bodily harm of a female ex-colleague. For a period of almost two years, the man followed the women home from work, made numerous silent phone calls, wrote her over 800 letters, drove past her house, visited her house without consent, and wrote offensive words on her house’s door three times. Following these actions, she received two additional letters with threatening language. She was soon diagnosed by a doctor as suffering from clinical depression and anxiety due to apprehended fear caused by the man’s actions and letters. A man was convicted of assault occasioning actual bodily harm of a female ex-colleague. For a period of almost two years, the man followed the women home from work, made numerous silent phone calls, wrote her over 800 letters, drove past her house, visited her house without consent, and wrote offensive words on her house’s door three times. Following these actions, she received two additional letters with threatening language. She was soon diagnosed by a doctor as suffering from clinical depression and anxiety due to apprehended fear caused by the man’s actions and letters.

Remedies

1. Action for damages- Whenever the plaintiff has been wrongfully detained, he can always bring an action to claim damages. Compensation may be claimed not only for injury to the liberty but also for disgrace and humiliation which may be caused thereby. According to McGregor on damages, the details of how the damages worked in false imprisonment are few: generally, it is not a pecuniary loss or of dignity and is left to the jury and their discretion. The principle heads for damage would appear to be the injury to liberty, i.e., the loss of time considered primarily from a non-pecuniary viewpoint, and the injury to feelings, i.e., the dignity, mental suffering, disgrace and humiliation with any attendant loss of social status.
2. Self help– This is the remedy which is available to a person who while he is still under detention instead of waiting for legal action and procuring his release thereby.
3. Habeas Corpus– It is speedier remedy for procuring the release of a person who is wrongfully detained. Such a writ may be issued either by the Supreme Court under Article 32 or by a High Court under Article 226 of Indian Constitution. By this writ person detaining is required to produce the detained person before the court and justify the detention. If the court finds the detention is without any just or reasonable ground, it will order that the person detained should be immediately released.

It is just possible that the person wrongfully detained may have been set free by the time the writ of habeas corpus is disposed off. The court hearing the petition may grant compensation as ancillary relief in such cases . in the case of Rudal Shah v. State of Bihar and Bhim Singh v State of J&K, the Supreme Court granted such compensation in writs of habeas corpus.

Conclusion

Assault is an attempted offense, the law is intended to prevent possible battery by punishing conduct that comes in a dangerous way to obtain battery. As with most attempted crimes, a clear line cannot be drawn between a criminal attack and conduct that is merely an attack preparation. There should be an intention to cause harm, but it is not enough if it creates the possibility of damage or the danger of battery in a distorted future. Instead, the intent must be taken out of imminent danger, some overt act that endangers the battery. Thus, words or intentions do not constitute mere attack.

The post Assault as a tort and its Remedies appeared first on iPleaders.

This article is written by Sonali Chauhan, a student of Lloyd Law College, Greater Noida. The author, in this article, has discussed the concept of Bar of Limitations on Torts.

Introduction

In Ireland, the law of limitations is governed by the Statute of Limitations,1957 as amended by the Statute of Limitations (Amendment) Act, 1991 and the Statute of Limitations (Amendment), 2000. In summary, it provides that if proceedings are initiated after the expiry of the statutory limitation period specified for the claim in question, the defendant may raise the defense that the proceedings are ‘statute-barred’, thus precluding any discussion of the merits of the claim.

Limitation of Action

Both the claim for a contract and the claim for tort are subject to their own limitation period rule. In most concurrent cases, it appears that because of the longer limitation period, the plaintiff prefers tort claim to contract claim. It is therefore important to explore the different limitation period rules that apply either to tort claims or to contract claims in order to find the answer to the question as to whether the courts allow the complainant to rely on tort claims due to the longer limitation period.

If the complainant fails to bring the lawsuit within the required period of time, the statute of limitations will generally bar his claim and dismiss it. The court enforces the limitation period agreed by the parties although, if such a period is reasonable, it is shorter than the period specified by the applicable statute of limitations. However, because this is contrary to public policy, the agreed period that is longer than the legislative limitation period is held void.

Effects of Expiry of Limitation Periods

The effects of the limitation periods are rather procedural than substantive in that they bar a remedy and does not extinguish the claim itself. Sir John Donaldson MR stated:

In Ronex Properties v. John Laing Construction [1983] QB 393, 404, ‘it is trite law that the English Limitation Acts bar the remedy and not the right, and furthermore, that they do not even have this effect unless and until pleaded’. 

Exceptionally, rights can be extinguished by themselves. For example, conversion rights are extinguished by lapse of time (Section 3 of the Limitation Act,1980) and rights under the Consumer Protection Act, 1987 are barred by the ten-year-long stop (Section 11A(3) of the Limitation Act,1980).

The Primary Limitation Period in Tort

The current limitation periods can be found primarily in the Limitation Act,1980 (as amended by the Latent Damage Act,1986 and the Consumer Protection Act,1987).

The basic principle is that tort actions are subject to a six-year limitation period from the date on which the cause of action was accrued (section 2). However, there are a few important exceptions:

The relevant period is three years in actions in tort for damages for personal injury. This begins either from the date on which the cause of action has accrued or from the date on which the injured person first became aware of his injury (Section 11 and 14).

In the case of latent damage to property considered below (Section 14A, 14B), a discoverability test is provided.

The normal limitation period for claims pursuant to the Consumer Protection Act 1987 is three years (Section 11A), whether for personal injuries or other forms of damage pursuant to the Act.

Also, three years is the limitation period for defamation claims (Section 57 Administration of Justice Act, 1985).

The Accrual of the Cause of Action

The limitation period begins to run from the date on which the cause of action of the claimant accrued. In torts actionable per se (such as battery or conversion) the claimant normally becomes aware of the act of interference that constitutes the tort.

In torts requiring damage, when the damage is first sustained, the cause of the action accumulates, regardless of the knowledge of the claimant. Although the damage may increase in scale and extent over time, the cause of action increases when the damage first begins to occur and no new cause of action will occur unless a fresh causative factor is involved or another type of damage is sustained.

Statute of Limitation under U.S. Law

Overall, the breach of contract cause of action is likely to have a different limitation period compared to the claim of tort. The determination of the limitation period will influence the characterization of the cause of action between contract and tort. There are different limitations statutes, both federal and state, that have limited different time periods in both contract and tort caused by actions.

In Hutchinson v. Smith, 417 So. 2d 926 (Miss. 1982), the court acknowledged that where the complainant has more than one legal remedy (both in contract and tort), he may choose to seek a remedy which would be more beneficial in view of the applicable limitation period. Therefore, pleading by the plaintiff and the form of action may dictate the applicable limitation period.

As appeared in the legal malpractice actions, some courts have applied the tort statute of limitations to the legal malpractice actions when the complaint of the plaintiff sounds in tort, although the claim may be brought in the contract.

Normally, the issue of the limitation period to be determined by the court is the issue of the starting date of the limitation period. This is because the statutes often state that when the cause of action of the plaintiff accumulates the period begins to run. The court has to determine at what point of accrual, to begin with, is interpreted by the court, in the case where the wrongdoing and the resulting injury are not simultaneous. In doing so, the court will consider the distinct rules amongst “(1) the occurrence of legal violation (the occurrence rule), (2) the resulting damage (the damage rule), and (3) the awareness of the resulting harm and its causation (the discovery rule).” Especially if the discovery rule is applied to the action, the shorter limitation period may not be barred. In contrast, due to the earlier date applied by the occurrence rule, the longer period may be time-barred.

The Statute of Limitation for Tort Claim

The time limit for claiming tort varies from one state to another. In the event of negligence, the complainant is often required to initiate the claim within two or three years from the date on which the cause of action accrues.

With regard to the cause of action in tort, the commencement of the limitation period relies on the occurrence of the harm. Some courts recognized the rule of damage requiring the actual damages as the essential elements of a cause of action for negligence. In other words, in order to maintain the claim, all the elements are necessary for the cause of action, such as the tort of a legal malpractice claim, must occur. Traditionally, the cause of action of tort increases when damages occur. Furthermore, the concept of continuing wrong may postpone the accrual time of the cause of action in tort, whereas this concept does not apply to action for breach of contract. These may explain why the tortious action limited time may expire later than the contractual claim. However, if the claim of the plaintiff involves intentional tort, the limitation period begins to run on the date of the wrong act because the damage is not the essential element of the actions. It is noteworthy that the discovery rule is also adopted in order to determine the beginning point of the limitation period in the event of claims for latent injury and action in the tort of medical malpractice as well as legal malpractice.

The characterization of the claim has affected the right of the complainant to be relieved in relation to time limitations, especially in the concurrent claim. The court sometimes held that the action sounds tortious by looking at the gravamen’s action even though the plaintiff makes an attempt to allege breach contract to get benefit from the longer limitation period. However, the court also considered the nature of the contractual obligation to apply limitations to the action claiming damage caused by the negligent failure of the defendant to perform duties arising from a contract.

Statute of Limitations under English Law

The Limitation Act 1980 governs the question as to whether the cause of action of the complainant is barred by the limitation period. If the plaintiff does not commence his claim for the right to remedy within a fixed period of time, the action is barred. In such a situation, the complainant has the burden of proving that within the limitation period his claim is asserted.

The Statute of Limitations for Tort

It is provided that “An action based on tort shall not be brought after the expiration of six years from the date on which the cause of action accrued”. Whereas the cause of action accrues on the date of the wrongful act of the defendant in the case of tort actionable per se, in the case of negligence which can only be brought on the basis of proof of damage, the cause of action accrues at the time the damage actually occurs.

In addition, the three-year period is the special time limit for personal injury actions. The rule states that the three-year period applies to

“any action for damages for negligence, nuisance or breach of duty (whether the duty exists by virtue of a contract or of provision made by or under a statute or independently of any contract or any such provision) where the damages claimed by the plaintiff for the negligence, nuisance or breach of duty consist of or include damages in respect of personal injuries to the plaintiff or any other person.”

The three-year period begins to run from “(a) the date on which the cause of action accrued; or (b) the date of the injured person’s knowledge (if later).

In the event of negligence causing any form of latent damage to be recovered, the action shall not be brought after either six years from the date on which the action arises or three years from the date on which the complainant had the knowledge of certain facts required to bring an action for damages if this period later expires. Importantly, only tort claims are covered by the latent damage provisions contained in section 14A of the Limitation Act, 1980.

Actions in Tort

Torts Actionable Per Se and Torts Actionable on Proof of Damage

11(2) of the Statute of Limitations, 1957, states that an action based on tort shall not be brought after the expiry of six years from the date on which the cause of the action accrued.198 For tort actionable on the basis of proof of damage, such as negligence, the cause of the action shall arise if the wrongful act of the defendant causes damage. For tort actionable per se, such as trespass, false imprisonment, and libel, the cause of action will arise when the wrongful act is committed. The distinction between torts actionable per se and those enforceable on the basis of evidence of damage is a relic of the historical development of the law of tort and can be explained by reference to the following underlying policy: torts actionable per se involve prima facie wrongful conduct, the harm of which is usually immediately apparent, and as the act was deemed to be such as to arose violent resentment, it was in the interests of public security to provide an instant remedy. For example, in trespass, when there is a direct physical act that interferes with the possession of the plaintiff, the cause of action accrues.

Conclusion

In conclusion, the plaintiff has a longer limitation period to commence his claim in certain types of tort claim. This may be because there’s a longer statutory limit. Or it might be because the cause of action in tort occurs later than that of contractual action. Or it may be due to the application of the latent damage limitation period. As can be seen, the complainants choose to rely on the tort claim in most concurrent cases when the contractual claim is barred by limitation statutes.

Students of Lawsikho courses regularly produce writing assignments and work on practical exercises as a part of their coursework and develop themselves in real-life practical skill.

The post An overview to Bar of Limitation on Torts appeared first on iPleaders.

This article is written by Ramanuj Mukherjee, CEO, LawSikho.

How can I succeed?

Work hard.

Work hard is conventional wisdom. It is supposed to be the cure-all of all problems. Since we were little children, we were told to work hard in response to each and every problem.

Want to be at the top of your class? Work hard.

Want respect and dignity? Work hard.

Want to earn more money? Work hard.

Want to get to the top of the profession? Work hard.

Have you ever considered that working hard is a mantra taught to the working and middle class so that people stay in their place and keep working? If they got the pot of gold at the end of the rainbow, they will stop working. How does the system work then?

Work hard is really not the cure call.

Yes, hard work is necessary to solve hard problems. But even the daily wage laborers work very hard and still do not get rich.

What is the catch here?

Work hard is absolutely false. Working hard is an excuse used by a majority of people to not do what they have to do.

Today I rest, and tomorrow it will be fine because I will work hard!

We have this conception of hard work as a brute force that when applied will get us results.

It is true that if you get a lot of work done you will benefit from it. If you consistently work more than others it will put you ahead of them. All of that is true. 

But that really happens when you love your work. When you put passion and love into your work, when you are inspired to do something extraordinary, when you really care and dive in to make something happen, you may end up working a lot more than someone just doing a job.

However, this passion and love for one’s work are very rare. These things do not come from a place of arrogance, brute force or greed. It is the same thing that makes a soldier proud to lay down his life for his motherland.

It is great if you are ready to outwork your competition. However, it is not the smartest thing to go for the brute force method. If you really care about the results, will you not try to find the most efficient way to get things done? If you really care, will you not consider the impact of your work on everyone else?

We are entering an era where more and more work can be done by technology. Even if AI taking away our work is some years away, even now an individual can get done what an entire team was required to do, because of enhancement in technology.

There was a time when an entire crew was needed to film an ad.  Today an entrepreneur with little technical training can shoot an ad for his own products, using nifty gadgets and easy to use intuitive software.

Anyone can build their own basic website with drag and drop tools. Some of my friends who run boutique law firms prefer to make their own website because they have greater control over the same and they do not want to waste their time coordinating with web developers that they find hard to work with. And this is not an anomaly. Wix, a technology that allows people to make their own website without any technical knowledge, is a billion-dollar company!

Why just a website, WordPress allows you to launch your own blog in a few minutes, and its owner Automattic is a unicorn company too!

Let’s talk about lawyers. There was a time when great lawyers spent a lot of time reading and memorizing case laws. They would systematically spend some hours reading case laws and making notes in their notebooks. Then when a case came up, if they were lucky they would quickly find the relevant cases, in favour as well as against them. This was a very critical aspect of the practice. Those lawyers who did not memorize enough cases would find it very hard to compete with such lawyers, because how are you going to look for a case you do not know exist from volumes of SCC or AIR?  So top senior lawyers used to be walking encyclopedias of various judgments. 

Nani Palkhivala, for example, was exalted for his ability to refer to cases and facts in a way nobody else could during his long speeches before judges.

Judges used to rely on submissions from both sides apart from what he already knew about the subject matter. It was next to impossible for them to do independent research because the research was extremely time taking. 

And now? Judges have law clerks who can quickly lookup each precedence available within minutes, very accurately, and brief the judge on the exact point of law. This means that judges of today come prepared to a hearing, having done independent research if they need to, at least in important cases. This has fundamentally changed courtroom dynamics in a way that few people have talked about.

People used to be impressed by a lawyer’s ability to cite accurate citations of a case! That playing field has been leveled. Today an intern can look up more case laws than what Nani Palhivala could remember on any subject thanks to leaps of technology. The value of hard work in remembering case laws is fast disappearing.

And this is not a one-time incident. It is a trend. This trend is accelerating.

There was a time when a junior who could do due diligence accurately and with no mistakes were valued resources. Today, a bulk of that work is done by due diligence software powered by AI. Where we needed 4 juniors to do due diligence, now we just need 1.

The trend is that simple, repeatable, mechanical work and functions are fast becoming fodder to machine learning and technology. We need to be careful about where we put our work in.

What is of more value then? Has working hard no value at all?

That is not what I am suggesting. However, value has shifted from simple, recurring, functional things to more complex things that require human intuition, connection, empathy, courage, and leadership.

Relationships are more valuable than ever. If you are working hard on your relationships, that will pay off. If you are preserving your integrity, building a brand for being fair and competent, that is worth more than ever.

Working hard on your brand makes sense more than ever.

Working hard on developing your leadership potential means more than ever. Much more than your ability to memorize sections from a statute!

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Technology has made a whole genre of legal education entirely obsolete. The hardest part of legal practice once upon a time was the precedence – finding case laws to justify your point. The entire legal education system was built around it. And that used to work until there came platforms like Indian Kanoon and Manupatra. Now even the clients look up such case laws before meeting their lawyer!

But the education system is yet to adapt to this new reality. Our law colleges still teach law the way they used to 30 years back, when the internet was just nascent and Google was not even born. How does that make sense?

This is why you will find a plethora of law graduates who are unemployable, complaining about not being given a chance by the industry. Industry sees them as asking for more than they bring on the table, and very expensive to hire and train.

Most law graduates have worked hard in the wrong direction. They have pursued marks rather than true knowledge and skills. They have learned how to pass exams. This was valuable once upon a time, when rote learning, memorizing and being able to regurgitate accurately was a virtue. But that was a few decades earlier! These days, a computer can reproduce any knowledge much more accurately and faster than any topper of any university.

Do you see how topping in an exam taught you useful life skills 30 years back but does not help at all anymore? I hope you do, because that may help you to think harder about what is the kind of things you need to put your effort behind.

I implore you to do only one thing: identify what can make you into a better, more effective, valuable lawyer. Do not listen to people who built their career in a different era. Most of them are clueless about what technology is doing to change the legal services landscape and those old men are majorly responsible for failing to read the signs and causing much of the trouble the legal industry finds itself in today.

On one hand, it is deprived of well-trained lawyers who can actually do the work clients need then to do, on the other hand, there are employers and clients desperate to find competent and honest lawyers, while lakhs of law graduates struggle to understand what is there to be done.

The answer is simple: develop legal skills. While you are at it, also develop communication skills and leadership skills. 

That is the way to the top.

Here are some courses that may help you in that pursuit:

Diploma 

Diploma in Companies Act, Corporate Governance and SEBI Regulations

Diploma in Entrepreneurship Administration and Business Laws

Executive Certificate Courses

Certificate Course in Real Estate Laws

Certificate Course in Arbitration: Strategy, Procedure and Drafting

Certificate Course in Securities Laws, Insider Trading and SEBI Litigation

Certificate Course in Media and Entertainment Law: Contracts, Licensing and Regulations

Certificate Course in Legal Practice Development and Management

Certificate Course in Advanced Civil Litigation: Practice, Procedure and Drafting

Certificate Course in Advanced Corporate Taxation

Test Preparation

Judgment Writing and Drafting Course for Judicial Services

Dream Job Bootcamp

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The post The Hard Work that Counts and The Hard Work that Does Not appeared first on iPleaders.

This article is written by Ramanuj Mukherjee, CEO, LawSikho.

How do you know the economy is not doing well? The perfect answer is this: when the government announces measures to counter a slowdown. With tax cuts in both direct and indirect tax and various stimulus packages, the government has finally signaled that the economy is in trouble and we need to recover from here. 

Well, lawyers have already noticed the problem a while back. A lot of law firms have put hiring freeze. Assessment internships are not leading to jobs. 2019 graduates are still searching for jobs several months after graduation and are shocked to find out that there are few takers even at subsistence salaries. Fee recovery is at a low point, as many clients are in economic distress.

John F Kennedy, who was a president of the USA, used to say that a rising tide lifts all boats. This means that when an economy is booming, everyone tends to do well.

Even if you are not that good at your job, rising demand means that you will still find opportunities and be comfortable. 

However, a recession has the exact opposite effect. When the swimming pool in drained, you will find out who was swimming naked, goes another saying.

The pool is getting drained. Those lawyers who never bothered to develop requisite skills are now getting caught off guard. They are finding themselves in trouble.

What is happening in the legal industry?

Inefficient lawyers and law firms that do not adapt to technology, did not care much about providing value to clients, those prone to shortcuts rather than building value over the long term are now at a lot of risk. 

Those who charged premium prices without having the skills to really back those prices, and fooled client after client and got away with it, will be in trouble now. This is because a slow down or a recession makes the customers still spending money in the market more cautious than ever. They remember the problems of the past, and in a buyers market, they have pricing power and do not hesitate to experiment more with new service providers.

On the other hand, relatively new good law firms and lawyers who genuinely work for clients and provide great solutions at an efficient price point will be in more demand than ever. It will also force a lot of lawyers to innovate and improvise to survive. They will come up with new business models, and adapt new technology and practices that they resisted before, simply to survive. As clients will be more price-sensitive during the recession, they will find ways to do the same work more efficiently.

A recession is not all gloom and doom – there are some benefits for the fit

A recession ends the arrogance of incumbent big players and levels the playing field for newcomers. Even the incumbents that survive, have to learn to be humble and may have to relearn how to take care of the clients. Isn’t that beautiful? 

Google, Amazon, Microsoft, GE, Revlon, FedEx and hundreds of greatest companies in the world were all started during a recession. Is that just a coincidence?

If you aspire for big success, a recession may be just the right opportunity for you to grow even faster. It may present opportunities that you do not come across every day. 

The best in an industry do not have to worry about recession

The best does not only survive a recession, but they also flourish during a recession! Don’t take my word for it, McKinsey, Bain and Harvard Business Review all agree. Let me quote an article from a May 2019 issue of Harvard Business Review (HBR):

“In their 2010 HBR article “Roaring Out of Recession,” Ranjay Gulati, Nitin Nohria, and Franz Wohlgezogen found that during the recessions of 1980, 1990, and 2000, 17% of the 4,700 public companies they studied fared particularly badly: they went bankrupt, went private, or were acquired. But just as striking, 9% of the companies didn’t simply recover in the three years after a recession—they flourished, outperforming competitors by at least 10% in sales and profits growth. A more recent analysis by Bain using data from the Great Recession reinforced that finding. The top 10% of companies in Bain’s analysis saw their earnings climb steadily throughout the period and continue to rise afterward. A third study, by McKinsey, found similar results.”

So almost 1 in 10 companies during the worst recessions was still flourishing while others were going out of business! Who are these people? What do they do? What made this difference? Will, you not want to know?

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What happens when a recession hits? 

Most people act reactively. They cut down investments, fire people, try to survive. This happens when you were not prepared for a recession at all.

Btw, in India, we are still growing. Growth has slowed down, but we are not in an actual recession yet. In a recession, the economy contracts instead of expanding. According to Karvyy, a financial institute, we may hit an actual recession, as economic crisis deepens, in 2020. This is almost inevitable if the government’s economic stimulus fails to attract private investments to the economy. 

So things could get worse.

What are you going to do about it?

The answer is to prepare.

The studies described above found that companies that had contingency plans in place, which had thought through alternative scenarios, and prepared for a recession, did really well during the recession. According to the same HBR article, the major areas to prepare for, as far as a company is concerned, are debt, decision making, workforce management, and digital transformation.

So if preparation is the key, how can lawyers prepare for a slow down or a recession?

It is not so different for lawyers either.

Rule number 1 is to not run out of money. You need to be cautious during a recession. Revenue, the number of matters and recovery of fees may go down during a slow down unless you are a very famous lawyer. 

It is a fact that absolutely top litigators in a court may not get affected much. But the rest are vulnerable. You need to manage your money very carefully during the recession. It is not the time to make big investments in upgrading your chamber or buying fancy gadgets.

On the other hand, it may be a great time to invest in software that increases comfort and value for your clients or reduce the hours you need to spend on something, i.e. increases your efficiency. It may also be a great time to learn new skills that help you to get a new type of client. For example, it is a great time to learn IBC or arbitration given the number of disputes over payment delays and failure to pay debts is steadily going up, requiring more qualified lawyers in these areas.

Watch out for government actions and reactions

You need to watch out for government actions also. Certain areas of the legal industry are heating up due to government policies and investments. A good example will be technology startups and intellectual property. The government has taken a slew of measures to create more indigenous technology, including a new rule that CSR money can be spent on research and development by accredited labs! This means that work for patent lawyers and technology lawyers may be going up despite a slow down!

It is the same for IBC. Since the government made it a priority for banks to recover NPAs there has been a tremendous activity for lawyers working at NCLT.

As the government is committed to transforming India into a hub for arbitration, we are most likely to see changes in this department.

Also, a slew of economic reforms can be expected, including possibly allowing foreign law firms to practice in India. Reforms will be dime a dozen. Disinvestments are also likely to be in the offing, leading to more work for corporate lawyers and capital market lawyers.

Are you preparing for the upcoming opportunities?

There are jobs, but the threshold to getting hired in more. There would be clients looking for a good lawyer, but threshold of performance that they will accept with be high.

Recession is the time for tightening your belts, upping your game and trying to be as efficient as you possibly can. That is how you get to roar your way out of a recession.

How long will this slow down last? 

If we go by the opinion of Manmohan Sing, former Prime Minister, and a visionary economist, India will need 3 years to get back on its feet provided the government introduces favorable economic policies and engages in important reforms. We must take his words seriously because he took India out of its biggest financial crisis in 1991, through reforms. 

It looks like we will have to tighten our belts for a while. It’s time to make tough decisions. Take hire cuts. Spend on what really matters and not on luxuries. Time to become more efficient.

Do not miss the opportunities out of fear and analysis paralysis

However, this does not mean we should miss opportunities. As the economy is in distress, prices of assets may come down. I have been for example buying a lot of shares that are available at a great discount currently due to terrible economic outlook. I expect the equity market to crash even deeper, and when it does I will invest more.

It is also a great time to invest in software, and you may find excellent resources to hire at a relatively lower salary, as the upward pressure on salary levels has eased off.

It is also a great time to invest in education because learning new skills for a new world should be your priority. It should be your priority to up your game to the next level, and education is the whetstone that sharpens the mind! Real skills that are very valuable will help you to take yourself to the next level of success. 

What is your plan for what is going down? How will you prepare?

How will you be more effective, efficient and powerful during the slow down, and possibly a recession? Do you have a blueprint? Want to discuss your plans with me? Reply to this mail and ask to schedule a call with me.

The Master Access program is still available and we are taking in a few people. We haven’t so far increased the prices given the difficult economic situation, but it will not last for very long. So hurry up and enroll if you were interested!

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Diploma in Entrepreneurship Administration and Business Laws 

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Certificate Course in Arbitration: Strategy, Procedure and Drafting

Certificate Course in Securities Laws, Insider Trading and SEBI Litigation

Certificate Course in Media and Entertainment Law: Contracts, Licensing and Regulations 

Certificate Course in Legal Practice Development and Management

Certificate Course in Advanced Civil Litigation: Practice, Procedure and Drafting

Certificate Course in Advanced Corporate Taxation

Test Preparation

Judgment Writing and Drafting Course for Judicial Services 

Dream Job Bootcamp

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The post Forged in Pain: The Chaos of a Slow Economy is the Ladder you Asked for appeared first on iPleaders.

This article is written by Kanishk Gambhir, pursuing a Diploma in M&A, Institutional Finance and Investment Laws (PE and VC transactions) from Lawsikho.com. Here he discusses “Can a Loss Making Company be an Attractive Target? Why?”.

Introduction

In 2018, Walmart acquired Flipkart for 16 billion dollars even though since Flipkart’s inception in 2007, Flipkart has not earned a profit of even a single penny. In fact, Flipkart losses were approximately Rs. 8,771 crores in FY17. So, the question arises why would such a proficient company like Walmart buy a loss-making unit and this is not an isolated incident, that is, companies merging or acquiring or investing in loss-making entities. In fact, it has been happening for ages and more so in the present era of the startups. Another way to look is the valuations of the companies even after making losses- Paytm valuation is $15 billion but its losses were roughly  471 million dollars. So, the question that arises is how do these loss-making entities have such a huge valuation despite making losses or why would any companies want to acquire them?

The answer for the same is that presently companies have stopped playing the short-sighted game but have learnt to look at the bigger picture and that is why I believe that Yes, Loss-making companies can be an attractive target and the reason for the same are multifold as just looking at the profits of the companies is a very inadequate, orthodox albeit safe way of doing business. So sometimes taking risks in present loss-making entities reap much more financial benefits in future, of course, it doesn’t come without its own risk factor but as Mark Zuckerberg said: “The biggest risk is not taking any risk.” So sometimes taking no risk can very idiotic decision to make. 

So, here are a few reasons why a loss-making company is an attractive target.  

1. Growth – Nowadays in both saturated and unsaturated markets it is more about market grabbing than getting profits. And easiest way to grab the market is by providing ridiculously high discounts in a competitive market (Like Zomato) or saturated market (like Jio).  So, even though initially they suffer high losses, they have grown in revenue and market share which gradually over the years can be easily converted into a profitable venture, once you have developed a loyal customer base.                   

This idea of long term growth plan was further fanned by the entry of new-age Asian investors like Softbank, Tencent etc. So, now it is more about who sells more, whose revenue is higher than profitability. So, companies look at growth in the future, then profit in present.

2. Tax benefits– Sometimes, depending on the laws of the country, countries allow the acquirer to reduce the tax by reduction of profits when a company acquire a loss-making entity by addition of profit of one company to the loss of the another. So, this leads to a deduction of profits which further leads to a reduction in tax payable. This would be a very similar case when Google acquired Motorola back in 2011 and took advantage of Motorola’s 700 million dollars operating loss in the form of tax benefits. 

Generally, such benefits arise due to unused tax losses, unused tax losses, unused debt capacity, surplus funds, and the write-up of depreciable assets.  Tax carry forward helps the acquirer to offset the income it plans to earn which will help in saving taxes. So, sometimes a loss-making entity becomes a very attractive target due to their ability to help in tax gains. 

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3. Future potential – Some companies, especially in the case of unsaturated markets, especially try to look at future potentials of the companies rather than what they are contributing in the present. This would generally be in case of newer ventures like Artificial intelligence, E-Wallets, drones etc. or even industries like e-commerce which is still in the growth stage. So, sometimes you have to bet on how these companies will attract clients in the future to get a first mover’s advantage.

4. Huge valuations of Intellectual Property Rights– This might be one of the few reasons which don’t involve huge risks for the investors as some companies despite being loss-making have some intellectual property rights like patents or copyrights which have huge valuations in the market. So, then it is not rocket science to understand that even though they might be loss-making but investing in them is usually a clever idea as you are not betting on them but you are betting on their Intellectual property rights which would be a good bet in spite of their losses.
    
5. Quality assets underutilisation– Some companies are loss-making not because of their business model or there are providing huge discounts to clients but just because of poor management at the top. Reasons are same can be multifold inefficiency or inapt knowledge in sudden growth of business, continuous departures of the people in top management which leads to underperforming of the assets, so sometimes if an investor/acquirer is able to differentiate between poor management and a bad company, loss-making companies can easily be turned around with proper utilization of assets which makes them an attractive target.
    
6. Asset Stripping –  According to Investopedia, Asset stripping can be understood as a practice where undervalued or loss-making companies are brought with the sole intention of selling the assets to generate the profits. This is usually done in a case where the value of assets separately of the companies is much more than the company as a whole, reasons of which can be poor economic conditions, poor management etc.  This is one of the practices which some people say is in morally grey area but as Jim Slater, one of most infamous British Corporate Raiders, used to say “If a firm has its assets stripped it means they have not been properly used.” and at the end of the day business is about profits, so, sometimes loss-making entities with highly valued assets is a very attractive target.
    
7. Market Goodwill– Some companies have high market goodwill with them despite being loss-making. The best example of this could be Nokia.  So, buying such companies is more about the use of the goodwill then about their assets and liabilities. Generally, the investor backs such companies to cash in on the goodwill of such companies which has been built over the course of multiple years and generally with the right management companies can be turned around. So, high market goodwill can make a loss-making entity attractive.
     
8. High Liquidity– Liquidity, refers to the availability of liquid assets with a business. Some businesses like banks, Investment companies etc. have high liquidity and some times larger companies when they are in a cash crunch and in order to get out of the situations can easily acquire smaller companies which have high liquidity using stocks and shares and benefit from their liquidity to get out of their cash crunch problem. Sometimes this is also done to maintain the liquidity ratio which might have decreased generally in a year in which outflow of cash was very high with minimal/ low inflow. So, that is why even if companies are loss-making on the balance sheet but their high liquidity makes them an attractive target. 

9. Potential Market Valuation –  Lyft Inc., a cab ride-hailing company from the US, recently did its first Initial Public Offering was valued at $24.3 billion. Point of notice should be that this success came even after it’s steep losses. This showcases that even though the companies the unprofitable status of the companies does not affect the stock market and it doesn’t care. It looks beyond the losses and towards future growth. So acquiring such private companies earlier promises a good rate of return on the investments. In fact, according to a new pitchbook report, In US, unprofitable companies had a higher and more profitable debut at the stock market than the profitable ones. What these showcases that profitability as a sole criterion has been long gone and people look at other things like exponential growth rate, gradual turn into profitability. What these promises are huge returns on investments for any investors.

Furthermore, in the case of companies making losses for growth and expansion may seem bad on the balance sheets, but it is doing wonders for the valuations of such companies.  So, a loss-making entity can be very attractive as a target if you won’t make a quick gain out of their good market debut but of course, this gamble won’t be without its own risk. 

10. Eliminating Competition – Sometimes, despite being a loss-making entity company have a huge potential of growth. So to the other profitable companies in the same sectors, these loss-making companies might seem like a very attractive target to remove any future competition in the present itself. They would prefer to splash some money now to lose it later. So, despite being loss-making at present companies might get the attention of the competitors, who would prefer to remove the competition before it becomes a problem. 

Conclusion

The ‘money’ in the world of mergers, acquisitions and investing, it seems doesn’t depend on the present but is more a bet on the future on what the companies would provide in the future. So, the present loss-making has generally stopped worrying any of the bigger investors as there are ready to wait and play the long game and earn big. Further, in businesses the oldest mantra is HIGHER THE RISKS, HIGHER THE RETURNS and investing in loss-making companies might be a risk but may provide exceptional returns. 

References

1. https://www.businesstoday.in/current/corporate/paytm-valuation-rose-25-pc-to-usd-15-billion/story/374415.html (Last accessed on 10-09-2019).
2. https://www.referenceforbusiness.com/encyclopedia/Man-Mix/Mergers-and-Acquisitions.html#ixzz5zFIgTJzc (Last accessed on 10-09-2019).
3. https://www.investopedia.com/terms/a/assetstripping.asp (Last accessed on 10-09-2019)
4. https://www.independent.co.uk/news/obituaries/jim-slater-businessman-who-became-first-famous-then-infamous-for-the-asset-stripping-firm-he-set-up-a6742741.html (Last accessed on 10-09-2019)
5. https://www.vox.com/2019/3/21/18274843/unprofitable-tech-unicorn-ipo-stock-market-profit (Last accessed on 12 -09-2019).

Students of Lawsikho courses regularly produce writing assignments and work on practical exercises as a part of their coursework and develop themselves in real-life practical skill.

The post Can a Loss Making Company be an Attractive Target? Why? appeared first on iPleaders.

This article is written by Shubhangi Sharma, a 5th-year student of BA LLB in Lloyd Law College, Greater Noida. The article discusses about false imprisonment in tort law.

What is false imprisonment?

Wrongful imprisonment occurs when a person (who does not have the legal right or justification) is intentionally restricts another person from exercising his freedom. When someone intentionally restricts another person’s freedom, he can be found liable for false imprisonment in civil and criminal courts. The factors which constitute false imprisonment are:

1. Probable cause of imprisonment.
2. Plaintiff’s knowledge for imprisonment.
3. Intent of defendant during imprisonment and confinement period matters.

This is applicable to both private as well as government detention. Under criminal law, whether the restraint is total or partial, the same is actionable. When the restraint is total and the person is prevented from going out of certain circumscribed limits, the offence is that of ‘wrongful confinement’ as defined in Section 340 of IPC. Under this, the Indian Penal Code punishes wrongful imprisonment. Section 339 to 348. When it comes to the police, proving false imprisonment is sufficient to obtain the writ of Habeas Corpus. It is not mandatory that the person should be put behind bars, but he should be confined in an area from which there are no possible ways of escape except the person’s will who has confined him. Depending on the laws of a particular jurisdiction, wrongful imprisonment can also be a crime, as well as intentional tort.

Elements of false imprisonment

All states have laws regarding false imprisonment designed for protecting people from being confined against their will. The laws of each state vary, but in general, certain constituents of false imprisonment must be present to prove a legal claim. To prove a false imprisonment claim in a civil suit, the following elements must be present:

Wilful detention

False imprisonment or restraint must be intentional or wilful. Accidentally closing the door when someone is on the other side is not a wrongful confinement or false imprisonment. Wilful detention applies to intentional restraint in any form, including physically restraining a person from exiting, physically locking him in a building, room, or from other places, and restraining him from leaving through force or intimidation.

The intention factor

Generally, the tort of false imprisonment must be intentional. A person is not liable for false imprisonment unless his or her act is done for the purpose of imposing a confinement or with knowledge that such confinement, to a substantial certainty will result from it. for this tort, Malice is irrelevant . It is ordinarily upon the judges to determine from the evidence, as a question of fact, the intention of the defendant in an action for false imprisonment. 

Knowledge of the plaintiff

The detention of another person would have been wrong. There is no requirement that the plaintiff claiming another person for false imprisonment was aware of his restraint on his freedom at the time of his confinement.

In the case of Herring v Boyle, it has been held that such knowledge is essential , in that case a schoolmaster wrongfully refused to permit a schoolboy to go with his mother unless the mother paid an amount alleged to be due to him , the conversation between the mother and schoolmaster was made in the absence of the boy and he was not cognizant of the restraint. It was held that the refusal to the mother in the boy’s absence, and without his being cognizant of the restraint, could not amount to false imprisonment.

In the case of Meering v Graham White Aviation, the claimant was asked to go to a room with two work policemen from the Aviation company. He asked why and stated he would leave if not told. When told it was on suspicion of theft he agreed to stay, and the works police stood outside until the metropolitan police arrived. Unknown to him they were asked to prevent him leaving. It was held that an act which fulfils the requirement for a false imprisonment, even if the claimant is unaware of it at the time, still counts. Meering was entitled to damages.

Defences of false imprisonment

The most common defense for false imprisonment is the lack of one or more of the elements. For example, if the victim agrees to imprisonment, then wrongful imprisonment did not occur. However, there are other defenses that can be used to defend a false imprisonment claim. Below are common defenses of false imprisonment claims:

Valid Arrest 

False arrest claims are not valid if a person was detained due to lawful arrest or due to arrest under law, if they have probable cause to consider a person to have committed a felony, or engaged in wrongdoing. In addition, a person can be legally detained for arresting a citizen without reason.

Consent to Restraint 

A person who consents to be restrained or confined without the presence of fraud or coercion or misconduct cannot subsequently claim to be a victim of false imprisonment. Therefore, voluntary consent to false imprisonment is often a defense to false imprisonment.

In the case of Robinson vs. Balmin New Ferry Company Ltd. the plaintiff wanted to take a ferry across a river. In order to get to the wharf from which the ferry would depart, he had to go through the turnstile which was managed by the defendants. As the notices on either side made it clear that the charge of using the turnstile was one penny. The plaintiff gave the penny, went through the turnstile and waited on the wharf for the ferry to arrive and pick him up. The plaintiff took decision not to take the ferry and changed his plans. He wanted to go through the turnstile for which the defendants demanded payment resisted by saying that if he wanted to use the turnstile than he was supposed to pay one penny. The plaintiff refused to pay the penny and the defendants didn’t allow him to use the turnstile. The plaintiff sued the defendant’s claiming that they had falsely imprisoned him. The court dismissed his claim by stating that if he walked through the turnstile than he voluntarily agreed to take the risk , that if he would not pay a penny than he will not be allowed to go back, he would be imprisoned by the defendants.

Probable Cause

This is a complete defense of action for false imprisonment and false arrest. When probable cause is established by the action then false imprisonment and false arrest completely fails. It is stated that the probable cause test for imprisonment and arrest is an objective one, which is not based on the actual crime on the individuals, but on the basis of reliable facts or information which would lead a person to take the usual precautions as an offender. A defendant in an action of false imprisonment or false arrest has established a probable cause of alleged tort from which he has no additional obligation to prove it. Even if probable cause exists, malicious intent will not support a claim.

Sometimes imprisonment can be justified on the basis that the defendant was acting in support of the law. The blame for the legal justification lies on the defendant.

Remedies

There are main remedies for false imprisonment, which can be classified as follows:

Action for loss

Damages in false imprisonment are those that flow from detention. A person injured by conduct, either knowingly or negligently, is entitled to compensatory damages and has no duty to lessen the gravity of such damages. There is no legal rule for the assessment of damages and it is left entirely to the court. The basis of the damage includes injury and physical pain to the person, mental suffering and humiliation, loss of time earnings and interruptions in occupations, decrease in medical expenses, injury to reputation, etc.

The arresting officer is liable for the loss of time caused by the false arrest for the time that the officer produced the person before the judicial officer and is not liable thereafter. False arrest damages should only be measured up to the time of indictment. However, where a continuity exists between an unlawful arrest and subsequent discharge of the accused, as a continuing unlawful act, the defendant is liable for all consequences resulting from the false arrest.

Nominal and compensatory damages

The general rule in an individual personal tort action is that the plaintiff is entitled to recover an amount that would be just and equitable, justifying an award for exemplary damages in the absence of circumstances. Mere unlawful detention constitutes the basis for the recovery of at least nominal damages, but an award of nominal damages only may be insufficient and flawed where the facts have proved that the right to greater damages. It is now held that the person can now be imprisoned without knowing it. In such cases the plaintiff can receive only nominal damages. Mental suffering including fear, shame and hatred of arrogance and humiliation, which results in wrongful detention, is generally considered an injury that can be compensated for an action of false arrest or false imprisonment. 

Punitive, exemplary and aggravated losses

If an imprisonment is recklessly affected, extortion, dishonour, libel and malicious manner, the jury may go beyond the compensation rule and cause exemplary and punitive damages to the defendant as punishment. Punitive damages are being awarded in cases where the conduct of defendant is grossly indifferent to the rights of others or knowingly or reasonably violates those rights, and such damages are awarded to a deterrent. . Exemplary damage may be provided in certain circumstances when power is misused by the state. The increased damage may be awarded in a reasonable case when imprisoning one in a nominal character is offensive or the plaintiff’s feelings are hurt. Courts have often held that malice in the action of false imprisonment or false arrest will result in an award for exemplary or punitive damages. Punitive or exemplary damages will not be allowed where false imprisonment was brought in utmost good faith, without malice in law and where there is no element of oppression.

Habeas corpus

This writ is considered an effective remedy for immediate release from wrongful detention, whether in jail or in private custody by English law. The Apex Court of India and the High Court of States issue this writ under Articles 32 and 226 respectively. It deals with cases of false arrest or prolonged detention by police officers. Subject to the rules laid down by the High Courts, a person may be imprisoned for or by any person on his behalf.. The right of habeas corpus is an effective means of immediate release from unlawful detention, whether in prison or private custody. Where an unlawful detention continues the plaintiff may seek this writ. This writ is also used in criminal cases of false imprisonment. The decision will be that either the prisoner will be released or if the detention is proved than he will be produced before the court for a trial.

Self help

A person who has been detained unlawfully may use self-help to flee with reasonable force to protect himself from unlawful arrest. The force used must be proportional to the conditions. This is a risky method because the power of arrest depends not only in the commission of the crime, but in the alternative and in a reasonable doubt. So, if an innocent person finds a reasonable basis for their suspicion, then an innocent person who forcibly resists may be liable for battery.

Landmark cases

Bhim Singh vs. State of Jammu and Kashmir. In this case the petitioner, MLA of J&K was to participate in the Assembly meeting. His opponents in order to prevent him from attending the Assembly session got him arrested wrongfully with the help of some executives and police. The Magistrate also granted remand to police without compliance of the mandatory requirement of production of the accused in the Magistrate’s Court before reminding him to police custody. He was released after the Assembly session got over. The Supreme Court held the State liable for wrongful arrest and detention of the petitioner and ordered a compensation of Rs. 50,000 to be paid to the petitioner.

Rudal Shah vs. State of Bihar. In this case, the petitioner, an under-trial was wrongfully confined in jail for several years despite his acquittal by the Court. The High Court of Patna held that as soon as a person under trial is found not guilty by the court, he should be set free. Any detention after it shall be unlawful. The State had to pay a sum of Rs. 30,000 as compensation.

D.K.Basu vs. State of West Bengal., the petitioners came up with important issues concerning the police powers and if monetary compensation should be awarded for established violation of Fundamental Rights, as under Article 21 and 22 of the Constitution. The court decided that Custodial violence, including torture and death in the lock ups, strikes a blow at the Rule of Law, which demands that the powers of the executive should not only be arose from law but also that the same should be limited by law. To check the abuse of police power, transparency of action and accountability were the two safeguards laid down by the court. 11 directives has been issued by the court where it spelled out the rights of an arrestee or a detainee and the manner in which the arresting or detaining authority is expected to behave, including the written record of arrest, informing of arrestee’s family of his arrest, medical examination on request, among others.

Conclusion

False imprisonment may be because of malicious intention of the defendant or by negligence but the sufferer is the plaintiff , hence while awarding the compensation one must keep in mind about the place of confinement, time of confinement and force used by the defendant. The above mentioned considerations will make sure that the aggrieved person gets fair justice.

False imprisonment also violates Article 21 of the Indian Constitution which includes right to life and personal liberty. Any person who is wrongfully imprisoned can take legal action against the wrongdoer for the violation of their fundamental right. Under Article 21 we have the fundamental right to move freely, if any person is restraining the fundamental right then he can be sued in a court of law.

Students of Lawsikho courses regularly produce writing assignments and work on practical exercises as a part of their coursework and develop themselves in real-life practical skill.

The post False imprisonment under law of Tort appeared first on iPleaders.

This article is written by Shubhangi Sharma, a 5th-year student of BA LLB in Lloyd Law College, Greater Noida. The article discusses employers liability in tort law.

What is Law of Tort?

Tort is a civil wrong. The common torts are negligence, battery, trespass, etc. These are instances where someone has done injustice to someone else, and the law must determine where the mistake lies.

Definition by Sir John Salmond– “Tort is a civil wrong for which remedy is a common-law action for unliquidated damages, and which is not exclusively the breach of contract, or the breach of trust, or other merely equitable obligation”.

Definition by Fraser– “Tort is an infringement of a right in rem (right in general) of a private individual giving a right of compensation at the suit of the injured party”.

The person who commits a tort is known as the tortfeasor. The law imposes a duty to respect the legal rights vested in the members of the society and the person making the breach of that duty is said to have done a wrongful act.

In general, liability depends upon the defendant having an act or omission, acted in breach of legal duty incumbent on him and infringed a recognized legal rights vested in the plaintiff and thereby caused plaintiff harm of foreseeable kind, not eveccry harm is actionable, there is no liability for an inevitable accident, or an act of God: there is justification such as statutory or common law authority. The pecuniary consequences of liability may be shifted by liability insurance.

Personal liability of employers

Personal liability of an employer towards their employees is derived from both common and statutory law. Personal liability is concerned to ensure the physical safety of their employees. 

Duty of employer to take reasonable care to ensure the safety of employees

Any employer is bound to take reasonable care to ensure the safety of its employees. It is important to note that this duty is personal and non-representative. This duty was found in the case of English of Wilson and Clyde Company Limited.

Safe place of work

The place of employment must be safe, it must include safe premises with a safe working environment. The implementation of this principle is in the case of Latimer v AEC Ltd.

The obligation to provide a safe place of work extends to situations in which employees are tasked to go off-site to work in places which are not controlled by their employer. This means that those employees whose job is to go to different places can enjoy the same level of protection as those who work at the same place every day. The responsibility of providing a safe place to work will increase if employees are tasked with going off-sites to work which is not under the control of the employer.

This means that those “employees” whose job includes going to different places can enjoy the same level of security as those who work at the same place every day. In Wilson v. Tyneside Window Cleaning Company [1958], the court held that employers still have a duty to care for employees, even if they are working outside their employers premises.

Safe equipments and materials

An employer must equip their employees with safe and properly maintained equipment. If employees are working with particular equipment, it will be expected that the equipment is high quality which can avoid unnecessary risk which was decided in the case of Knowles v. Liverpool County Council.

Safe system of work

The safe system of work is a wide responsibility upon employers, it’s really difficult to decide what characterizes good and bad system of work. For this reason, the court decided to take the decision on a case to case basis, whether liability exists. This means that the duty to provide a safe system of work covers a wide range of conditions. This includes situations in which employees are not warned of any danger. In addition, an employer cannot simply provide a safeguard and then forget that a particular risk exists. This has been observed in Bax v Slough Metal [1973]. If a particular risk has arisen itself, then its mandatory for the employer to take preventive actions.

The duty to provide a safe system of work extends to protecting the mental health of employees. This was held in the case of Walker v Northumberland County Council [1995]. It was held that there was no reason why an employer’s working system did not include preventing psychiatric harm. However, there is a limit to the tasks expected of an employer in relation to providing a safe working system. It is the duty of an employer to impose a safe system of work; they are still entitled to trust the employees to follow it as a sensible man.

Competent staff

Employers should provide competent colleagues to their employees. The need to provide competent employees can give rise to two different types of liabilities – a breach of duty to provide competent staff, but also a claim can also arise as a result of vicarious liability.

Vicarious liability

Generally, a person is liable for his own wrongdoing and one does not bear any obligation for the work done by others. When an employee commits a tort in the course of performance of his duty, the liability of the employer arises for such wrongful act. The employer will be liable because of the employee-employer relationship between the two. Both can be held liable for the same wrongful act. They will be considered as joint tortfeasor and their liability is joint or several. In this case plaintiff has a choice either to sue the employer or the employee or both of them.

Vicarious liability depends on two legal maxims:

Quit facit per alium facit per se

This maxim also applies in the case of principal and agent. When a person authorizes another person to perform a particular task, he becomes the chief and the doer becomes the agent. In this case, the principal becomes liable for the act of the agent. So, this legal maxim of vicarious liability is Quit facit per alium facit per se. It also implies that the employer (or senior) is responsible for the work of the employee.

Respondeat Superior 

This legal maxim means “Let the Superior be Liable”. If we have to understand this maxim then we can take a daily life example i.e. we often see seniors sending juniors to seek adjournments or file applications. If the junior is not able to understand the task well, or tries to show his or her legal skills by making some commitment even if not specifically instructed by the senior person, then in that case, the superior is responsible to answer judge and also to clients.

There are some tests which determine the relationship between employer and employee. They are:

• The control test

The first significant test that the courts developed was the control test. According to the test, a person is called a servant if his employer controls not only the work he performs but the way he does it. In true sense, the employer is the party that establishes the work ethic of the employee and the employee in charge when he is performing his duties as an employee.

It was first established in the authority of Yewens v Noakes. In this case, the defendant was a hops merchant and possessed certain houses for the purposes of his business. The claimant was the clerk of the defendant with a set annual salary. Meanwhile, he was required to take care of the houses. Thus, he lived in the house with his family. The core issue of the case are regarding the payment of inhabited house duty. Therefore, the key question was whether the claimant is a servant of the defendant? It was held that in this instance, the claimant did not fall under the definition of a servant. On appeal, the court held that the premises were purely for trading purposes. Thus, the claimant was only a caretaker. Lord Bramwell stated that a servant is a person who is subject to the command of his master as to the manner in which he shall do his work. However, the control test is appropriate when the employer is superior to the employees in terms of knowledge, skills and experience.

• The integration test

The organization test is first identified by Lord Denning in the case of Cassidy v. Ministry of Health. Lord Denning considered whether a doctor working within the NHS was an employee of the Health Authority. It was again referred by Lord Denning in the case of Stevenson, Jordan & Harrison Ltd v MacDonald and Evans. In this case, Lord Denning further stated that ‘one feature which seems to me to run through the instances is that, under a contract of service, a man is employed as part of the business and his work is done as an integral part of the business; whereas under a contract for services, his work, although done for the business, is not integrated into it but is only accessory to it’.

• Multiple tests

Multiple tests is also known as economic reality test. It includes analysis through a list of factors regarding employment status. This includes control and organization testing, it acknowledges that although each point is important, no one is a determinant because the employment relationship is far more complex. For the first time the application of test was in the case of Ready Mixed Concrete (South East) Ltd v MPNI., in this case some conditions were laid down:

• The servant agrees to contribute their skills and work to the master for performing some service in exchange of a certain amount of consideration.
• He agrees to work under a master during his employment service.
• The other provisions of the contract are consistent with the provision of being a contract of service.

Control test is no longer the only way to determine the relationship of master and servant as it is felt that in the current situation, where there are many factors that affect the process of determining the relationship between employee and employer, It is not possible to use only one test and thus different aspects of a case are looked at to determine the nature of the relationship and to decide whether such a relationship belongs to the master and the servant.

Vicarious liability in employment

The employer may be held liable for actions or omissions during the employee’s job. An employer is not liable for work done by his employee which is not within the scope of his employment. There are three elements that need to be present for vicarious liability.

1. The person who has committed the tort must be an employee.
2. Tort must be committed by an employee.
3. Tort must be committed during employment.

The above mentioned elements is required for vicarious liability. This can only exist if the person doing the wrong was an employee, and he / she commits the wrongdoing (result in damage and caused injury to someone), and the wrongdoing was committed during his work when he/she was under the scope of their employer.

Joint and several liabilities

If two or more defendants are found liable for an indivisible injury, the defendants will be jointly and severally liable. This means that each defendant is liable for the entire award regardless of the individual degree of defect. Because a so-called “deep pocket” defendant may be held liable for an entire damage award, even if such a defendant is only partially liable with. California has modified the doctrine of joint and several liabilities for personal injury cases. To make financial liability closer to the degree of defect, California does not impose multiple liabilities for non-economic damages.

Conclusion

Employer’s liability is a strict liability as he is responsible for any of the harmful actions committed by their employees. The most important thing that employers can do is to ensure that they have taken all reasonable steps to avoid any malicious act or omission from occurring. For example, to ensure a safe place of work, allotment of safe equipment and materials, providing competent staff to the employers to demonstrate an active commitment on the part of the employer towards combating discriminatory practices in the workplace. The employer will be liable for the tort committed by the employee within the course of employment. The employer will be vicariously liable for the tort done by an employee.

Students of Lawsikho courses regularly produce writing assignments and work on practical exercises as a part of their coursework and develop themselves in real-life practical skill.

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