West Bengal Panchayat Elections

Supreme Court Refused to countermand West Bengal Panchayat Elections:

These were the reasons given by Supreme Court for declining to interfere:

“[I]t would be inappropriate for this Court to exercise its jurisdiction to interdict the declaration of results of the uncontested seats. First and foremost, it is necessary for the Court to notice that no specific relief was claimed before the High Court in regard to those seats where there was no contest. Neither were there adequate pleadings nor indeed were specific prayers set up before the High Court when its jurisdiction under Article 226 was invoked. The proceedings before the High Court were brought by several political parties, each of whom would have been well aware of the situation on the ground and the need to formulate an adequate basis in fact to invoke the jurisdiction of the High Court. Absent such a factual foundation, the High Court dealt with the only issue which had been addressed, which was the plea that nominations should be allowed to be filed in the electronic form. No other plea was raised.

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Eviction of tenant under Rajasthan Rent Act.

Rajasthan Premises (Control of Rent and Eviction) Act, 1950; Section 13.

It is evident from Section 13(3) of the Rent Act that the use of the word ‘shall’ puts a mandatory obligation on the court to fix provisional rent within three months of the filing of the written statement but before framing of the issues. The language of the Section is mandatory and places a duty on the court to determine the provisional rent irrespective of any application or not. If the rent so determined by the court is paid by the tenant as provided under Section 13(4), no decree for eviction of the tenant can be passed on the ground of default under Section 13(1)(a) in view of Section 13(6) of the Act. It is thus clear that unless the determination under Section 13(3) takes place, Section 13(6) cannot be complied with and a valuable right given to a tenant would be lost. The High Court, in our view, has rightly held Section 13(3) of the Act to be mandatory.

[Source: Ram Pratap vs Anand Kanwar decided by SC on 21 August, 2018]

Scope of Moratorium under Bankruptcy Code 2016.

Whether Section 14 of the Insolvency and Bankruptcy Code, 2016, which provides for a moratorium for the limited period mentioned in the Code, on admission of an insolvency petition, would apply to a personal guarantor of a corporate debtor?

The amended Section reads as follows:

“14. Moratorium.— xxx xxx xxx (3) The provisions of sub-section (1) shall not apply to—

(a) such transactions as may be notified by the Central Government in consultation with any financial sector regulator;

(b) a surety in a contract of guarantee to a corporate debtor.”

The Insolvency Law Committee, appointed by the Ministry of Corporate Affairs, by its Report dated 26.03.2018, made certain key recommendations like:

“…….since many guarantees for loans of corporates are given by its promoters in the form of personal guarantees, if there is a stay on actions against their assets during a CIRP, such promoters (who are also corporate applicants) may file frivolous applications to merely take advantage of the stay and guard their assets. In the judgments analysed in this relation, many have been filed by the corporate applicant under Section 10 of the Code and this may corroborate the above apprehension of abuse of the moratorium provision.

The Committee concluded that Section 14 does not intend to bar actions against assets of guarantors to the debts of the corporate debtor and recommended that an explanation to clarify this may be inserted in Section 14 of the Code. The scope of the moratorium may be restricted to the assets of the corporate debtor only.”

The Report of the said Committee makes it clear that the object of the amendment was to clarify and set at rest what the Committee thought was an overbroad interpretation of Section 14. That such clarificatory amendment is retrospective in nature.

“In determining, therefore, the nature of the Act, regard must be had to the substance rather than to the form. If a new Act is ‘to explain’ an earlier Act, it would be without object unless construed retrospective. An explanatory Act is generally passed to supply an obvious omission or to clear up doubts as to the meaning of the previous Act. It is well settled that if a statute is curative or merely declaratory of the previous law retrospective operation is generally intended. The language ‘shall be deemed always to have meant’ is declaratory, and is in plain terms retrospective. In the absence of clear words indicating that the amending Act is declaratory, it would not be so construed when the pre-amended provision was clear and unambiguous. An amending Act may be purely clarificatory to clear a meaning of a provision of the principal Act which was already implicit. A clarificatory amendment of this nature will have retrospective effect and, therefore, if the principal Act was existing law which the Constitution came into force, the amending Act also will be part of the existing law.”

[Source: State Bnk of India vs. Ramakrishnan decided by SC on 14 August, 2018]