COMMUNIQUE APRIL, 2021

COURTS THIS MONTH 

• The Supreme Court in light of the second wave of the COVID-19 pandemic being witnessed by the country, took suo motto cognizance In Re Cognizance for Extension of Limitation (MA No. 665/2021 in SMW(C) No. 3 of 2020) and extended all periods of limitation ending on 14.03.2021, until further orders of the Court. The Court proceeded with the same by restoring its prior order passed on 23.03.2020 which had also extended the limitation period as prescribed under any special or general laws in respect of all judicial or quasi-judicial proceedings, last year. The said order was passed by the Apex Court in exercise of its powers under Article 142 read with Article 141 of the Constitution of India, 1950 considering the difficulties being faced by litigants in the present climate.
   
• The Supreme Court finally settled the much-debated issue of whether two companies incorporated in India or Indian nationals engulfed in a dispute can choose a forum for arbitration outside India. A Bench headed by Justice Rohinton Fali Nariman observed that “Nothing disrupts the overall progression of party autonomy in assigning a seat of arbitration outside India regardless, when both the parties wind up being Indian nationals.” The judgement was passed in the matter of PASL Wind Solutions Private Limited Vs. GE Power Conversion India Private Limited (Civil Appeal No. 1647 of 2021), wherein the relevance of the principles of party autonomy in arbitration matters were deliberated upon at length.
   
• The Apex Court recently held that a breath analyzer test or blood test as stipulated under the Motor Vehicles Act, 1988 is not necessary to enable an Insurer to reject an accident policy claim in cases of drunken driving. A Bench comprising of Justices UU Lalit, Indira Banerjee and KM Joseph observed that in a situation where the Insurer has sufficiently established that the accident had occurred due to the driver being under the influence of alcohol, scientific material in the form of tests were not required to make out a case for exclusion. The Bench did, however, hold that “The totality of the circumstances obtaining in a case, must be considered”. The judgement was passed in IFFCO Tokio General Insurance Company Ltd v Pearl Beverages Ltd. (SLP (Civil) No. 12489/2020).
   
• The Supreme Court’s Bench comprising of Justices Rohinton Fali Nariman and Hrishikesh Roy held in M/s Inox Renewables Ltd v Jayesh Electricals Ltd., (SLP (C) No. 29161 of 2021) that when parties mutually agree upon changing the ‘venue of arbitration’ the same would be considered as the ‘new seat of arbitration’. Consequently, it was observed that the Courts at the changed venue/place of arbitration will have exclusive jurisdiction over the arbitral proceedings between the said parties, given the said replacement.
   
• A Constitution Bench of the Supreme Court has directed that Magistrates have to record reasons prior to changing trial of complaints under Section 138 of Negotiable Instruments Act, 1881 from summary trial to summons trial in exercise of power under the second proviso to Section 143 of the said Act. The Bench headed by ex-Chief Justice of India S A Bobde expressed that the High Courts may give practice directions to the Magistrates with respect to the aforesaid, considering such conversions from summary trial to summons trial were being done mechanically, without reasons being recorded, thereby contributing to the delay in disposal of cases.
   
• The Apex Court’s Bench comprising of Justices DY Chandrachud, MR Shah and Sanjiv Khanna observed that the High Court while rejecting a quash petition under Section 482 of Criminal Procedure Code, 1973 (“Cr.P.C”) or Article 226 of the Constitution of India, 1950 should exercise restraint from passing orders of “not to arrest” and/or “no coercive steps” with respect to the accused(s), prior to completion of investigation. The Court observed that the accused(s) should be consigned to apply for anticipatory bail under Section 483 of Cr.P.C before the competent court in such circumstances. The judgement was passed in M/s Neeharika Infrastructure Pvt. Ltd. vs. State of Maharashtra (CrA 330 of 2021). The Bench went on to issue certain guidelines encapsulating circumstances within which the High Courts would be justified in passing interim orders of the aforementioned nature.
   
• The Supreme Court in State of Rajasthan vs. Ashok Kumar Kashyap (CrA 407 of 2021) held that defence on merits of a case is not to be looked into by the Courts at the stage of framing of charges and/or while considering a discharge application. The Court observed that the said stage is not to be treated as an instance to conduct a mini trial.
   
• The Bench comprising Justices Ashok Bhushan, S. Abdul Nazeer and Hemant Gupta observed that in case a writ petition is preferred under Article 226 of the Constitution of India, 1950, it would not bar such High Court to alternatively exercise its jurisdiction, which it otherwise possesses, under a Statute and/or under Article 227 of the Constitution. The judgement was passed by the Supreme Court in Kiran Devi Vs. Bihar State Sunni Wakf Board (CA 6149 OF 2015). It was observed that the nomenclature of the title of the petition filed before the High Court is immaterial.
   
• A Single Bench of Justice Yashwant Varma of the Allahabad High Court dismissed the writ petition filed by the All UP Stam Vendors Association in the matter of All UP Stamp Vendors Association v. Union of India & Ors. (Writ C No. 11738 of 2020). The said petition was filed seeking continuation of judicial and nonjudicial stamp paper in its physical form. The petitioners had contended that the Uttar Pradesh E-Stamping Rules, 2013 will create a disadvantageous position for them resulting in business losses being incurred. The Bench observed that a government cannot be placed under an obligation to frame a business model which may guarantee a profitable return in the business. Additionally, the Bench also stated that the Constitution guarantees right to trade and not right to profit as a fundamental right to its citizens.
   
• A Division Bench of Justices Nitin Jamdar and CV Bhadang of the Bombay High Court refused to grant interim relief to Cutis Biotech, which was seeking an order restraining Serum Institute of India (“SII”) from using the trademark ‘Covishield’ for its coronavirus vaccine. Cutis Biotech had filed a suit, alleging instances of passing off, in the Commercial Court at Pune and had sought an interim injunction against SII. The High Court observed that the Civil Court’s order was neither arbitrary nor perverse and did not warrant the High Court’s intervention. The Bench observed, “that ‘Covishield’ is a vaccine to counter Coronavirus is now widely known. A temporary injunction directing Serum Institute to discontinue the use of mark ‘Covishield’ for its vaccine will cause confusion and disruption in the Vaccine administration programme of the State”.
   
• A Single Judge Bench of Justice VG Arun of Kerala High Court held that service of summons over the online messaging app, WhatsApp, is not an accepted mode of service under law. The order was passed in Anoop Jacob v. State of Kerala (Crl. M.C 1658/21), wherein a nonbailable warrant issued when the accused failed to appear before a Special Court was directed to be kept in abeyance, pursuant to summons being sent over WhatsApp. The Bench declared that the communication of summons in the manner dispatched was not an accepted mode of service.
   
• In C/SCA/5584/2021, a Single Bench of Justice NV Anjaria of Gujarat High Court allowed an engineering student to take a supplementary exam as he failed to take the earlier semester exams due to his deteriorating mental health during the lockdown period. The student had moved the High Court against the decision of the University to cancel his registration. However, the Court also observed that it needed to inspect, at a later stage, whether the Petitioner had compelling reasons which prevented him from appearing in the examination and “…whether they were special circumstances or they constitute a good medical ground.”
   
• The Delhi High Court’s Bench comprising of Justice Anup Jairam Bhambhani held that photographs taken from social media websites and uploaded on pornographic website without the consent of the person concerned amounts to an offence under Section 67 of the Information & Technology Act, 2000. An offence would also be said to have been committed under the said Act even if the photographs are not in itself obscene or offensive but are posted without the consent of the party. The Court also emphasised on the role of intermediaries in such cases and held that they are mandated to remove and disable access to such offending content once they receive ‘actual knowledge’ by way of a court order or notification by the appropriate government authorities. The failure to comply with the same may result in such an intermediary losing its exemption from liability under the said Act.
   
• In a significant judgement of the Kerala High Court, it was held that a job notification issued by Kerala Minerals and Metals Limited was violative of Articles 14, 15 and 16 of the Constitution of India, 1950. The said job notification only allowed male candidates to apply for the post as the nature of employment would require working during night hours, making females ineligible for applying for the said job post. The said judgement was passed on 09.04.2021 in Treasa Josfine Vs State of Kerala & Ors. (W.P (C) No. 25092 of 2020). It was observed that a woman who is fully qualified cannot be denied of her right to be considered for employment on the basis of protective provisions.

 
NOTIFICATIONS/AMENDMENTS INSIGHTS 

• The Ministry of Finance vide its Notification S.O. 1704(E) dated 27.04.2021 has extended the deadline for submission of direct taxes under the ‘Vivaad se Vishwas Scheme’ from 30.04.2021 to 30.06.2021. The principal notification regarding the aforesaid was published for the first time on 27.10.2020. This has been done in the light of the second wave of COVID-19 pandemic being witnessed by the country presently.
   
• The Ministry of Micro, Small & Medium Enterprises on 01.06.2020 had introduced a scheme titled ‘Credit Guarantee Scheme for Subordinate Debt’ which was subsequently launched on 24.06.2020. The aforesaid scheme aims at providing credit facilities through lending institutions to the promoters of stressed Micro, Small & Medium Enterprises (“MSME”) viz. SMA-2 and Non-Performing Assets accounts who are eligible for restructuring as per Reserve Bank of India (“RBI”) guidelines. This scheme was initially to remain in operation till 31.03.2021. However, in order to continue supporting and assisting the stressed MSME units, the Ministry has extended the scheme from 31.03.2021 to 30.09.2021.
   
• The RBI’s Monetary Policy Committee vide its Press Release 2021-2022/16 decided to continue with its accommodative stance to mitigate the impacts of COVID-19 pandemic on the country’s economy. In light of the same it was decided that the policy repo rate under the liquidity adjustment facility (“LAF”) will remain unchanged at 4%. As a result of which, the reverse repo rate under the LAF remains unchanged at 3.35% and the marginal standing facility rate and the Bank Rate stands at 4.25%. These assessments were arrived at keeping in mind the present conditions prevailing with respect to the global and domestic economy.
   
• The Drugs Controller General of India (“DCGI”) has granted permission for restricted use of Russia’s Sputnik-V vaccine. The approval comes pursuant to the application made on behalf of M/s Dr. Reddy’s Laboratories Ltd. (“DRL”) to import and subsequently market the said vaccine developed by M/s Gamaleya Institute, Russia for Emergency Use Authorization. DRL has collaborated with National Research Centre for Epidemiology and Microbiology of the Ministry of Health of the Russian Federation for obtaining regulatory approval for import of Sputnik-V marketing in India. DRL was permitted to conduct a Phase- II/III clinical trial in the country and has also submitted interim data from the ongoing trials to the DCGI. After a detailed discussion, the DCGI has granted permission for restricted use of the said vaccine in emergency situations subject to various regulatory provisions.
   
• The Ministry of Finance vide Notification G.S.R. 286(E) dated 24.04.2021, in light of the surge of COVID-19 cases and the present crisis faced by the country in terms of lack of medical supplies has exempted selected items from levy of custom-duties at the time of its import. The list of the said items includes oxygen concentrators, medical oxygen, COVID-19 vaccines, non-invasive ventilation nasal/oronasal masks for ICU ventilators, oxygen cylinders, COVID-19 vaccines etc. This Notification shall remain in force up to 31.07.2021.

 
DEALS THIS MONTH 

• Leading Indian Edtech startup Byju with its latest round of Series F funding has raised funds over $460 Million for the financial year 2021-2022. Due to the ongoing pandemic, the reliance of the education sector has significantly shifted to online portals and apps, this played a pivotal role in subsequently boosting the valuation of the said start-up. The said funding was led by MC Global Edtech Investment Holdings LP.
   
• Australian real-estate advertising company REA Group Ltd., has entered into a binding agreement to acquire a controlling interest in Elara Technologies Pvt. Ltd. The said company to be acquired owns leading realty portals such as Housing.com, PropTiger.com and Makaan.com. The transaction is expected to be concluded in the coming quarter of the present year. The Australian company presently owns 14% stakes in Elara Technologies Pvt. Ltd.
   
• On 14.04.2021, the Board of Directors of Bharti Airtel have approved the composite scheme of arrangement between Bharti Airtel, Nettle Infrastructure Investments, Airtel Digital, Telesonic Networks and Airtel and their respective shareholders and creditors. The said scheme of arrangement is two-fold. Firstly, the merger of the wholly owned subsidiaries of Bharti Airtel, Nettle Infrastructure Investments, Airtel Digital and Telesonic Networks into Bharti Airtel and secondly, the demerger of the Telecom Business Undertaking of Bharti Airtel and vesting of the same with Airtel, the wholly-owned subsidiary of Bharti Airtel.
   
• On 15.04.2021, India’s leading ecommerce platform, Flipkart, announced to acquire 100% shareholding of the global online travel company, Cleartrip. The said acquisition will enhance Flipkart’s investment to cement its digital commerce offerings to customers. However, Cleartrip will still continue to operate as a separate brand and shall retain all its employees while working closely with Flipkart to further develop technology solutions with respect to online travel services.