Search Judgments

Central Goods and Services Tax Act, 2017 (CGST Act) – Section 17(5)(c) and (d) and Section 16(4) – This judgment addresses the constitutional validity and interpretation of Section 17(5)(c) and (d) and Section 16(4) of the CGST Act, concerning the eligibility for Input Tax Credit (ITC) on goods and services used in the construction of immovable properties, especially concerning renting/leasing activities.

The core issue revolves around whether restrictions imposed by these sections on availing ITC for the construction of factories, buildings, and commercial complexes against the GST received from renting/leasing are valid. The petitioners challenged these provisions, arguing they violate Articles 14, 19(1)(g), and 300A of the Constitution, leading to a cascading effect of taxes.

The court analyzes whether a distinction should be made between “plant and machinery” and “plant or machinery” and, the expression “plant or machinery” used in Section 17(5)(d) cannot be given the same meaning as the expression “plant and machinery” defined by the explanation to Section 17.

Hindu Marriage Act, 1955 (HMA) – Sections 5, 7, and 8 – Hindu Marriage – Essential ceremonies – Solemnization of marriage – A marriage is not valid under the HMA unless it is solemnized with the requisite ceremonies and rites, such as saptapadi, as required by Section 7. Mere registration of a marriage under Section 8, without the performance of such ceremonies, does not make it a valid Hindu marriage. A marriage certificate issued by a private entity or the Registrar of Marriages is not a substitute for the actual performance of the customary ceremonies.

Code of Civil Procedure, 1908 (CPC) – Section 25 – Transfer Petition – Settlement under Article 142 of the Constitution – Where parties to a transfer petition agree to a settlement, and the court finds that the “marriage” between them was not valid under the HMA, it can exercise its power under Article 142 of the Constitution to declare the marriage null and void and quash all related legal proceedings.

 The Representation of the People Act, 1951 & The Conduct of Election Rules, 1961 – The Supreme Court addressed petitions questioning the reliability of Electronic Voting Machines (EVMs) and seeking either a return to paper ballots or 100% Voter Verifiable Paper Audit Trail (VVPAT) slip counting. The petitioners, while not alleging malice by the Election Commission of India (ECI), expressed concerns about EVM manipulation and sought measures to enhance voter confidence.

The Court reviewed past cases upholding EVM use and transparency. It emphasized the extensive safeguards, including pre-election checks, randomization processes, and the VVPAT system, designed to prevent tampering.

Tamil Nadu Industrial Establishment (Conferment of Permanent Status) Act, 1981 – Section 3: This Act is a beneficial legislation that mandates permanent status for any workman who has completed 480 days of continuous service in a 24-month period, notwithstanding anything contained in any other law.

Industrial Disputes Act, 1947 – Section 12(3) Settlement vs. Statutory Law: A settlement reached under Section 12(3) of the Industrial Disputes Act cannot override or negate the benefits conferred upon a workman by a special statute like the Tamil Nadu Industrial Establishment (Conferment of Permanent Status) Act, 1981.

Interpretation of Law: The “notwithstanding” clause in a statute signifies that the provision takes precedence over any conflicting laws or agreements, including those made after the statute’s commencement.

Consumer Protection Act, 1986 – Locus Standi of Complainant – Representative Capacity and “Person” Definition: A complaint filed in a representative capacity under the Consumer Protection Act, 1986 (now repealed by the 2019 Act, but relevant for this case) must strictly comply with the mandate of Order I Rule 8 of the Code of Civil Procedure, 1908, read with Section 13(6) of the Act, requiring prior permission from the Commission. Furthermore, a “trust,” whether registered under the Indian Trust Act or a State Trust Registration Act, is not a “person” as defined under Section 2(1)(m) of the Consumer Protection Act, 1986, and thus cannot be a “consumer” or file a consumer dispute under the Act.

Banking Regulation Act, 1949 – Sections 21A and 35A – Jurisdiction of Consumer Forums: Section 21A of the Banking Regulation Act, 1949, explicitly bars courts/tribunals from reopening transactions between a banking company and its debtor on the ground that the rate of interest charged is excessive. The Reserve Bank of India (RBI) is the exclusive statutory authority empowered under Section 35A of the Act to issue directions and formulate policies regarding interest rates and banking operations in the public interest and for banking policy.

Specific Relief Act 1963 Section 9, 10 & 19 – Agreement to Sell – Proof of Execution and Possession: For a suit seeking specific performance of an agreement to sell, the plaintiff must conclusively prove the execution of the agreement, payment of consideration, and delivery of possession. The High Court can re-evaluate findings if the Trial Court’s conclusions are not supported by sufficient evidence.

Evidence Act, 1872 – Section 101 – Burden of Proof – Fraud and Misrepresentation: The burden of proving fraud or misrepresentation in the execution of an agreement lies squarely on the party alleging it. Failure to lead evidence to support such a claim will result in an adverse inference.

Specific Relief Act, 1963 – Section 12: Where a vendor’s title to a portion of a property is under a cloud or in dispute, the purchaser can seek a decree for specific performance for the remaining part of the property, with a proportionate reduction in the sale price. The plaintiff can elect to pursue part performance of a contract when the defendant is unable to perform the whole of their part.

Specific Relief Act, 1963 – Section 16(c): The plaintiff’s readiness and willingness to perform their part of the contract is a key requirement for a decree of specific performance. The court will consider the conduct of the parties as a whole, including the exchange of legal notices and subsequent payments, to determine if the plaintiff was ready and willing to complete the sale, even if there was a delay in filing the suit.

Specific Relief Act 1963- Section 9 And 10 –  Agreement for Sale of Immovable Property: The buyer was denied the discretionary relief of specific performance by the trial court, which was overturned by the High Court. The Supreme Court analyzed the parties’ conduct, especially the seller’s inconsistent behavior and the buyer’s consistent readiness and willingness to perform her part of the contract. The Court upheld the High Court’s decision, granting specific performance to the buyer, finding that she had not engaged in dilatory tactics and had demonstrated sufficient readiness and willingness.

Specific Relief Act 1963 – Section 20 And 31 – Suit Maintainability: A suit for specific performance of an agreement for sale, which was unilaterally terminated by the seller, is maintainable even without a specific prayer to declare the termination invalid.

Insolvency & Bankruptcy Code (IBC) – Section 61 And 62 – Corporate Insolvency Resolution Process (CIRP) Withdrawal: The IBC is not a mere recovery mechanism for creditors but a comprehensive law designed for the corporate debtor’s revival. While a settlement between a corporate debtor and an individual creditor is permissible, especially if it leads to the withdrawal of CIRP, the process must not prejudice the rights of other stakeholders and creditors.

National Company Law Appellate Tribunal (NCLAT) – Inherent Powers (Rule 11): The NCLAT has inherent powers under Rule 11 of the National Company Law Appellate Tribunal Rules, 2016 to facilitate settlements and permit the withdrawal of a CIRP, even after the admission of a petition by the National Company Law Tribunal (NCLT). This power, however, must be exercised judiciously, especially when a prescribed procedure like Section 12A of the IBC and Regulation 30A exists.

Sick Textile Undertakings (Nationalisation) Act, 1974 – Sections 5(1), 5(2), 30 – Liability of National Textile Corporation (NTC) for pre-acquisition debts: Under Section 5(1) of the Act, any liability of a sick textile undertaking for a period prior to the “appointed day” (date of nationalization) is solely the liability of the original owner and not enforceable against the Central Government or the NTC, unless it falls within the exceptions specified in Section 5(2).

Interpretation of “Contract for Service, Sale or Supply” under Section 30: A loan agreement or credit facility provided by a bank to a sick textile undertaking does not fall under the purview of “contracts for any service, sale or supply” as defined in Section 30 of the Act. Therefore, NTC is not obliged to ratify such financial contracts.

Acquisition of Sick Undertakings – Effect on Liabilities: Upon nationalization of a sick textile undertaking, while assets vest in the NTC, liabilities, especially those pre-dating the appointed day, are generally not transferred to the NTC unless specifically provided for by the Act.