Are RTI Documents Admissible in Evidence as
‘Public Documents’?

(By Saji Koduvath, Advocate, Kottayam)

Abstract

1.   RTI replies or information (other than certified copies) are not substantive
evidence in law. Therefore, they are not admissible in evidence as public documents, or as secondary evidence.

2.   Where copy of a Public Document is issued under the RTI Act, recording it to be a certified copy [under Section 2(j)(ii)], it is admissible in evidence (to prove the contents of the public documents) under Section 77of the Evidence Act.

3.   Where the copy of a document, which is not a Public Document, is issued under the RTI Act, recording it to be a certified copy [under Section 2(j)(ii)], it is admissible in evidence, only with further evidence as to the non-production of the original (as required under Section 65, Evidence Act).

4.   Notwithstanding anything stated above, in a proper case, the court can invoke presumptions as regards official acts,under Section 114, Evidence Act (The Court may presume the existence of any fact which it thinks likely to have happened, regard being had to the common course of natural events, human conduct and public and private business, in their relation to the facts of the particular case).

      l Illustration (e) of Section 114, Evidence Act specifically states that regularity can be presumed on Judicial and official acts. Presumptions may include genuineness or truth also.

Law on this Point

Evidence Act 

Section 65 of Evidence Act reads as under:

l“65. Cases in which secondary evidence relating to documents may be given - Secondary evidence may be given of the existence, condition, or contents of a document in the following cases –

l(a) … (e)…

l(f) when the original is a document of which a certified copy is permitted by this Act, or by any other law in force in India, to be given in evidence;

l(g) …

l… …

lIn case (e) or (f), a certified copy of the document, but no other kind of secondary evidence, is admissible.”

Section 74 reads as under:

l74.‘Public documents‘: The following documents are public documents :-

l                   (1) documents forming the acts, or records of the acts

      l                  (i) of the sovereign authority,

      l                  (ii) of official bodies and tribunals, and

      l                  (iii) of public officers, legislative, judicial and executive, of any part of India or of the Commonwealth  or of a foreign country;

l(2) Public records kept in any State of private documents.

Section 77 of Evidence Act reads as under:

l 77. Proof of documents by production of certified copies. Such certified copies may be produced in proof of the contents of the public documents or parts of the public documents of which they purport to be copies.

RTI – Act

lSection 2 (j) of the Right to Information Act, 2005 defines “Right to Information” as under:

l“(j)“right to information” means the right to information accessible under this Act which is held by or under the control of any public authority and includes the right to –

l(i) … …

l(ii) taking notes, extracts, or certified copies of documents or records.

Import of “To be Given in Evidence” in Section 65(f)

Section 65 Evidence Act deals with “Cases in which secondary evidence relating to documents may be given”. Section 65 (f) lays down two conditions:

1.   When the original is a document of which a certified copy ispermitted, by the Evidence Act, to be given in evidence.

2.   If certified copy is permitted, by any other law in force in India, to be given in evidence.

RTI-Certified-Copy, other than Public Document, Can be received in evidence only on showing reason for non production of Original

The RTI Act, though allows certified copy, it does not permit the same “to be given in evidence”. Therefore, the ‘certified copy’ obtained under the RTI Act can be received in evidence either (i) it is a public document (of which a certified copy is permitted by the Evidence Act) or (ii) it is permitted to be produced on showing reason for non production of original etc. (under Section 65 Evidence Act).

In Narayan Singh v. Kallaram (2015 (1) KLT OnLine 1158 (M.P.)), it was observed that RTI
documentscan be admitted as secondary evidence. The MP High Court held as under:

l “Clause (f) of Section 65 of Evidence Act makes it crystal clear that a certified copy permitted under the Evidence Act or by any other law in force can be treated as secondary evidence. Right to Information Act, in my view, falls within the ambit of “by any other law in force in India”. The definition of “right to information” makes it clear that certified copies of documents are given to the citizens under their right to obtain information. In my view, the court below has rightly opined that the documents can be admitted as secondary evidence. I do not see any merit in the contention that the documents obtained under the Act of 2005 are either true copies or attested copies. The definition aforesaid shows that the same are certified copies.”

It appears that the High Court did not give effect to the words “permitted … to be given in evidence”.

PRESUMPTION under Section 114, Evidence Act read with Section 35

Section 35 Evidence Act lays down that ‘an entry in any public or other official book
register or record or an electronic record‘ will be a relevant fact.

Section 35 of the Evidence Act reads as under:

l “35. Relevancy of entry in public record or an electronic record made in performance of duty:An entry in any public or other official book, register or record or an electronic record, stating a fact in issue or relevant fact, and made by a public servant in the discharge of his official duty, or by any other person in performance of a duty specially enjoined by the law of the country in which such book, register, or record or an electronic record is kept, is itself a relevant fact.

  l    Note: Relevancy engrafted to Section 35 Evidence Act is “entry in” any public or
official book, register etc.; it is not attached to the certificates or  information given under the RTI Act.

Besides direct evidence, or admission, the contents of a document can also be proved by circumstantial evidence or by invoking presumption. ‘Common course of natural events’, ‘human conduct’ etc., under Section 114, can be used to prove the existence and genuineness/truth of a document.

Illustration (e) of Section 114, Evidence Act, demonstrates that presumption as to ‘regularity’ can be invoked on Judicial and official acts, in proper cases.  ‘Regularity’ in Illustration (e) is not exactly the presumption as to ‘correctness or truth’. For such presumption, we have to resort the main section, Section 114 – that is, ‘common course of natural events’, ‘human conduct’, etc.

Referring relevant provisions of Himachal Land Revenue Act, 1954 and Section 35 of the Indian Evidence Act, 1872, it is held by our Apex Court in Partap Singh v. Shiv Ram (2020 (3) KLT OnLine 1184 (SC)),that Record-of-rights (Revenue document) carries the ‘presumption of correctness‘.

InInder Singh v. S.Raghbir Singh (1977 KLT OnLine 1199 (P. & H.) (F.B.)), it is observed as under:

l“The principle is that an official record, kept by a person, upon whom there is a public duty to make entries in it only after satisfying himself of the truth of those entries, is presumed to be correct. Such a document itself is evidence of the truth of its contents unless and until its falsity can be demonstrated by any of the various methods by which the evidentiary value of any public book, register or document may be attacked.”

In Shiv Ram v. Shiv Charan Singh (1963 KLT OnLine 1321 (Raj.)), it is observed as under

l“Where Section 35 properly comes into play, an entry made by a public servant in
any public or official book in the discharge of his official duty becomes relevant 
by itself, and no other proof of such entry is required as a matter of law by our Evidence Act, but this, does not exclude the possibility that such an entry may become admissible otherwise if it is properly proved to have been made by a person ordinarily competent to make it.” (Quoted in Mayadhar Nayak v. Sub Divisional
Officer, Jajpur (1982 KLT OnLine 1078 (Or.)).

RTI Replies are not a Substantive Evidence

As shown above,relevancy attached to Section 35 Evidence Act is “entry in” any public or official book made by a public servant in the discharge of his official duty; it is not engrafted to the certificates or information given under the RTI Act.

The usual method to prove documents (both, existence and truth of contents) is giving oral evidence or furnishing affidavit.

A certificate,in most cases, is an opinion, and prepared on the basis of other documents or evidences. In such cases, when it is an assumption or inference, it by itself, is not admissible, as it will only be, at the most, a secondary evidence. A Wound Certificate is not a substantive evidence. It has to be proved by a competent witness.

If presumption cannot be invoked under Clause (e) of Section 114 Evidence Act (that
judicial and official acts have been regularly performed), especially in the light of ‘best evidence rule’, no certificate or report can be taken as proved unless its contents are
proved in a formal manner. (This is why Order XXVI Rule 10 C.P.C. specifically says – Commission Report shall ‘form part of the record’).

Our Apex Court held inDharmarajan v. Valliammal (2008 (4) KLT Suppl.(SC)), that ‘a
certificate issued by the Tahsildar cannot be relied on without examining the Tahsildar who issued the same’. It is referred to in Pankajakshan Nair v. Shylaja (2017 (1) KLT SN 75 (C.No. 85).

Our Apex Court observed in State of Himachal Pradesh v. Jai Lal (2000 (2) KLT SN 15
(C.No.17) (SC)), as regards expert opinion that falls under Section 45 Evidence Act, as under as under:

l                   “An expert is a witness of fact. His evidence is really of an advisory character. The duty of an expert witness is to furnish the Judge with the necessary scientific criteria for testing the accuracy of the conclusions so as to enable the Judge to form his independent judgment by the application of this criterion to the facts proved by the evidence of the case. The scientific opinion evidence, if intelligible, convincing and tested becomes a factor and often an important factor for consideration along with the other evidence of the case. The credibility of such a witness depends on the reasons stated in support of his conclusions and the data and material furnished which form the basis of his conclusions.”

The information collected from the records of an office by an RTI Officer,or that furnished in RTI Reply, cannot be placed in a higher pedestal than the ‘opinion’ of an expert under Section 45 of the Evidence Act. In short, the RTI Reply, by itself, will not be a substantive evidence.

Note:

Following Decisions State the Views of our Courts

Kumarpal N. Shah v. Universal Mechanical Works (2019 (3) KLT OnLine 3233 (Bom.))

l                   Under RTI, usually the applicant gets Photostat copies of the documents which are certified as true copies. They cannot be equated with certified copies mentioned in the Evidence Act. In other words, if the official under RTI certifies and supplies a private document, it still remains a private document. Thus, the RTI Act does not affect the nature of a document (Datti Kameswari v. Singam Rao Sarath Chandra (2016 (2) KLT OnLine 2175 (Hyd.) referred to).

Datti Kameswari v. Singam Rao Sarath Chandra (2016 (2) KLT OnLine 2175 (Hyd.)).

l                   The Xeroxcopy certified by the designated Public Information Officer under Right to Information Act of theprivate documents are not certified copies within the meaning of the provisions of Section 65 of the Evidence Act. They are merely true copies of the private documents available in the records of the particular Department. The production and marking of such copies is permissible only after laying a foundation for acceptance of secondary evidence under clauses (a),(b) or (c) of Section 65 of the Act. The condition prescribed under the above cases (a), (b) or (c) of Section 65 of the Act have to be fulfilled before marking the true copies obtained under the Right to Information Act. However, the true copies of public documents certified by the designated Information Officer can be taken as certified copies of the public documents.

SURGE IN THE CASES OF SEXUAL HARASSMENT

By Advocate H.L. Kumar

A spike in sexual harassment cases among listed firms could well indicate greater PoSH awareness and clearer codes. But we’re a long way from ending this menace across India. In an advancing world of empowerment talk and increased awareness of personal rights, the conversation around one topic has stayed largely hushed, restricted to admissions within the close family at most.

The first type of sexual harassment is called ‘hostile work environment’ sexual harassment, and the second is called “quid pro quo” sexual harassment. Again, hostile work environment sexual harassment can happen in two ways: Someone you work with makes you the target of unwelcome sexually suggestive or demeaning comments, repeated and unwelcome requests for dates, offensive gestures, offensive touching, jokes or pranks, intimidating behaviours, or pornographic materials. This behaviour is directed because of gender status.

This means that the harassment occurs often enough to affect your ability to do the job well OR the level of harassment is so bad that even one incident is enough to affect the ability to do the job well. One must also show that the employer is responsible for the harassment (either directly or indirectly). This includes conduct by employer’s customers or vendors. For example, if one of the co-workers or a frequent customer makes offensive remarks, it must be shown how the workplace is responsible for allowing their bad behaviour. 

The other way hostile work environment harassment occurs is if the employer provides less favourable conditions of employment than to different-sex co-workers simply because of their gender status. This can include discriminatory hiring procedures, hours, wages, promotions, work schedules, work assignments, vacation or sick leave benefits, job evaluation, discipline, and termination.

Quid pro quo sexual harassment happens when a supervisor or other manager asks or demands sexual contact in return for employment benefits or promotions. It can still be sexual harassment even if one didn’t say “no.” Only gender status does not have to be the main reason for singling out for this unfair treatment, but it must be a large part of the reason for harassment.

Tell the harasser to stop 

If you do not feel safe or comfortable doing this, do your best to make it clear to the harasser that the offensive behaviour is unwelcome. Report the harassment to a person with decision-making authority. If your employer has workplace sexual harassment complaint procedures, follow them. Try to make your complaint in writing. If possible, have a trusted witness present when you make your complaint. Try to get some proof that the employer actually received your complaint and the date and time the complaint was made (for example, ask your employer to confirm in writing that they received your complaint). Keep a copy of your complaint. In most cases, before an employer can be liable under discrimination laws, the employer must be given notice of the harassment and must have a chance to deal with the problem.

There are two types of workplace sexual harassment. The first type is called ‘hostile work environment’ sexual harassment, and the second is called “quid pro quo” sexual harassment. Again, hostile work environment sexual harassment can happen in two ways: Someone you work with makes you the target of unwelcome sexually suggestive or demeaning comments, repeated and unwelcome requests for dates, offensive gestures, offensive touching, jokes or pranks, intimidating behaviours, or pornographic materials.

A spike in sexual harassment cases among listed firms could well indicate greater PoSH awareness and clearer codes. But we’re a long way from ending this menace across India. In an advancing world of empowerment talk and increased awareness of personal rights, the conversation around one topic has stayed largely hushed, restricted to admissions within the close family at most: 

Sexual harassment at the workplace

Even if little is apparent amid cubicles and cafeterias, the murky truth thrives beneath a shroud of silence. A 2022 report by the International Labour Organization reveals that more than one in five people employed—almost 23%—had experienced violence and harassment at work globally, physical, psychological or sexual.

Increase in sexual harassment cases

An analysis found that India’s top publicly traded companies saw a 70% surge in sexual harassment complaints in 2022-23, up from 451 the previous year. The count of reported cases in this sample of 23 large-cap firms is topped by big employers of office workers in large sectors like infotech and banking. Last fiscal year saw many employees return to work on hybrid models after the pandemic home shift. Online stalking—and worse—taking in-person forms of harassment may possibly explain the higher caseload. On the other hand, given the hush over it, the rise could be explained by enhanced reporting in response to more precise codes and greater confidence in redressal.

Either way, what’s undeniable is that the problem is all-pervasive and remains a menace at every level. Justice demands that it be stamped out. If doing this helps raise the participation of women in India’s workforce from dismal levels that would be an economic bonus. Across Indian workspaces, awareness of rights as well as grievance mechanisms has risen ever since the Supreme Court’s so-called Vishaka guidelines of 1997 kicked off change.  By codifying what was appropriate and what wasn’t, those rules served as a basis for the law that succeeded it: the Sexual Harassment of Women in the Workplace (Prevention, Prohibition, and Redress) Act of 2013, better known as the PoSH Act, is largely responsible in reducing the cases of sexual harassment. Keeping staff well informed of this law is a task that the HR departments of well-run companies take seriously, often by using train-and-test modules. Today, office employees are clearer about the scope of PoSH and the various ways in which individuals may be harassed. It could be a pattern of remarks, behaviours and deeds only someone who is subject to it can decode.

Sexual harassment at work is a serious problem. It can hurt the health and well-being of workers. It can make workers less productive. It can increase employee absenteeism and turnover. To stop this, you must also show that your employer is responsible for the harassment (either directly or indirectly). This includes conduct by your employer’s customers or vendors. For example, if one of your co-workers or a frequent customer makes offensive remarks, you have to show how your workplace is responsible for allowing their bad behaviour. The other way hostile work environment harassment occurs is if your employer provides less favourable conditions of employment to you than to your different-sex co-workers simply because of your gender status. This can include discriminatory hiring procedures, hours, wages, promotions, work schedules, work assignments, vacation or sick leave benefits, job evaluation, discipline, and termination.

Sexual harassment in the workplace is a serious problem. It can hurt the health and well-being of workers. It can make workers less productive. It can increase employee absenteeism and turnover. Sexual harassment anywhere – at work, at school, on the street, etc. – is not just about sex. It is about the harasser being hostile toward the victim or abusing power over the victim because of the victim’s gender.

What is not sexual harassment?

Many things are considered when a court or government agency decides what is and isn’t workplace sexual harassment. Workplace sexual harassment may be hard to prove in court or to the EEOC if what happened was:

•  Casual jokes or individual and isolated incidents (unless they are very serious, threatening or very offensive.)

•  Shouting in anger at woman by male officer may be a misbehavior but it itself is not covered under ‘sexual harassment’; Abhilasha Dwivedi vs. Department of Women and Child Development NCT of Delhi, 2020 LLR 169 (Del. HC)

•  Unreported harassment by a co-worker. A “co-worker” is someone who is not an owner, manager or supervisor at your workplace. This is why reporting the harassment as soon as possible is important. It will then be your employer’s responsibility to deal with the harassment and make it stop. If your employer does not make the harassment stop, then it is workplace sexual harassment.

N.N.Global Mercantile (P) Ltd. v. Indo Unique Flame Ltd.
– 2023 (4) KLT SN 40 (C.No.30) SC = 2023 KLT OnLine 1429 (SC)
and Ground Realities of Indian Situation in Arbitration Process

 (By Saji Koduvath, Advocate, Kottayam) 

Contents in a Nutshell

•     The 5-Judge Bench of our Apex Court, in N.N.Global Mercantile (P) Ltd. v. Indo Unique Flame Ltd.(2023 (4) KLT SN 40 (C.No.30) SC = 2023 KLT OnLine 1429 (SC) by majority (3:2), held that existence of a valid arbitration agreement (with sufficient stamp) was necessary for ‘reference to arbitrator’, under Section 8 of the Arbitration and Conciliation Act, 1996.

•     After 2015 Amendment on Arbitration and Conciliation Act, for ‘referring’  parties to arbitration (under Section 8) the courts should have “FOUND”, ‘PRIMA FACIE’ –

      •  (i)  the EXISTENCE of the arbitration agreement and

      •  (ii) the VALIDITY thereof.

•     Secion 8(1), as amended, reads as under:

•     “A judicial authority….shall…refer the parties to arbitration unless it finds that prima facie no valid arbitration agreement exists.”

•     The scope of judicial review and jurisdiction of the court under Section 8 (for reference to arbitrator) and Section 11 (for appointing arbitrator) of the Arbitration Act are identical.

PART I

N.N.Global Mercantile v. Indo Unique Flame Ltd. – Contentions, in Substance

The legal disputes in N.N.Global Mercantile (P) Ltd. v. Indo Unique Flame Ltd. ((2023 (4) KLT SN 40 (C.No.30) SC = 2023 KLTOnLine 1429 (SC), was placed before the Apex Court, treading following course:

•     A suit was filed by the appellant, to enforce a contract.

•     The defendant applied for reference under Section 8 of the Arbitration and Con-ciliation Act, the contract having contained an arbitration clause.

•     Trial Court rejected the application.

•     A Writ Petition was filed by the defendant challenging the Order. It was contended that the Arbitration Agreement was unenforceable as the (main) contract was
     unstamped.

•     The High Court allowed the Writ Petition. (Hence the plaintiff became the appellant before the Supreme Court).

It was argued before the Apex Court that the Arbitration Agreement in the contract was enforceable and could have been acted upon, even if the contract was unstamped and unenforceable under the Indian Stamp Act. The 2-Judge Bench of the Supreme Court, referred the matter to 3-Judge Bench.

The 3-Judge Bench of the Supreme Court, referred the case to 5-Judge Bench, pointing out that an arbitration clause would stand as a distinct, separate and independent from the substantive contract.  This is based on the doctrine of severability or separability. That is, when the parties enter into such a contract, there are two separate agreements,

•     (i) the substantive contract and

•     (ii) the arbitration agreement.

In this premise, the 3-Judge Bench opined as under: 

•     Even if the main contract was bad for it was unstamped or insufficiently stamped, the arbitration clause could be enforced.

•     The defect on insufficiency of stamp could be cured as provided in the Stamp Act, and therefore, it could not be said that an unstamped or insufficiently stamped instrument did not exist in the eye of the law.

•     The failure to stamp a document, did not affect the validity or unenforceability of the document, but it merely rendered the document inadmissible in evidence.

Before the 5-Judge Bench of the Supreme Court, it was argued –

•     by the respondents/defendants, on the basis of the relevant provisions of the Arbitration Act (especially Section 16), that an arbitration clause would stand as a distinct, separate and independent from the substantive contract and that an arbitration reference can be made by the court even if the arbitration agreement was insufficiently stamped; and

•     by the appellant/plaintiff, in view of the provisions in the Indian Stamp Act (especiallySection 33 and 35),that the arbitration reference could not be made by the court on the basis of an insufficiently stamped agreement. It was pointed out that unstamped or insufficiently stamped documents cannot be used as evidence for any purpose, as provided in the Stamp Act; and that for reference under Section 8 of the Arbitration Act the court has to specifically find that prima facie a “valid arbitration agreement exists”.

N.N.Global held – If Arb. Agreement Unstamped, No ‘Valid Arb. Agreement Exists’

It is held, by majority (3:2), in N.N.Global Mercantile (P) Ltd. v. Indo Unique Flame Ltd. ((2023 (4) KLT SN 40 (C.No.30) SC = 2023 KLT OnLine 1429 (SC)),that an arbitration reference cannot be made by the court under Section 8 of the Arb. Act, on the basis of an unstamped or insufficiently stamped agreement.

The Majority affirmed the findings in this regard, in the two earlier 3-Judge Bench decisions.

•     (i) Garware Wall Ropes Ltd. v. Coastal Marine Constructions & Engg.Ltd. (2019 (2) KLT OnLine 3125 (SC)  (it was held that an arbitration reference cannot be made on the basis of an unstamped or insufficiently stamped agreement).

•     (ii) Vidya Drolia v. Durga Trading Corporation (2020 (6) KLT OnLine 1025 (SC) (it was held that landlord-tenant disputes covered and governed by rent control legislation would not be arbitrable when specific court or forum has been given exclusive jurisdiction to apply and decide special rights and obligations).

The majority judgment Paras.110 and 111 of N.N.Global Mercantile (P) Ltd. v. Indo Unique Flame Ltd.((2023 (4) KLT SN 40 (C.No.30) SC = 2023 KLT OnLine 1429 (SC)) reads as under:

•     “110. An instrument, which is eligible to stamp duty, may contain an Arbitration Clause and which is not stamped, cannot be said to be a contract, which is enfor-ceable in law within the meaning of Section 2(h) of the Contract Act and is not enforceable under Section 2(g) of the Contract Act. An unstampedinstrument, when it is required to be stamped, being not a contract and not enforceablein law, cannot, therefore, exist in law. Therefore, we approve of paragraphs 22 and 29 of Garware (supra). To this extent, we also approve of Vidya Drolia (supra), insofar as the reasoning in paragraphs 22 and 29 of Garware (supra) is approved.

•     111. The true intention behind the insertion of Section 11(6A) in the Act was to confine the Court, acting under Section 11,to examine and ascertain about the existence of an Arbitration Agreement.”

PART II - Relevant Provisions of Law

Arbitration and Conciliation Act on ‘Arbitrability’

Section 8(1), Section 11(6A) and Section 16 of the Arbitration Conciliation Act requires con-sideration in this regard.

There is a major change in the concept of ‘separability’ of the arbitration clause in a con-tract, after 2015 Amendment. The Amendment directed that the existence or validity of an arbitration agreement has to be ‘found’ by the Court, before referring the parties to arbitration, and appointing arbitrator, under the Arbitration and Conciliation Act.

Section 8(1) of the Arbitration and Conciliation Act reads (after 2015 Amendment) as under:

•     “8. Power to refer parties to arbitration where there is an arbitration agreement – (1) A judicial authority, before which an action is brought in a matter which is the subject of an arbitration agreement shall, if a party to the arbitration agreement or any person claiming through or under him, so applies not later than the date of submitting his first statement on the substance of the dispute, then, notwithstanding any judgment, decree or order of the Supreme Court or any Court, refer the parties to arbitration unless it finds that prima facie no valid arbitration agreement exists.”

Section 11(6A) of the Arbitration Act (inserted by 2015 Amendment) reads as under:

•     “11. Appointment of arbitrators – (1) … (2) … (3) … (4) … (5) …

•     (6A). The Supreme Court or, as the case may be, the High Court, while considering
any application under sub-section (4) or sub-section (5) or sub-section (6), shall, notwithstanding any judgment, decree or order of any Court, confine to the exa-mination of the existence of an arbitration agreement.”

Section 16, Arbitration and Conciliation Act reads as under:

•     “16. Competence of Arbitral Tribunal to rule on its jurisdiction – (1) The arbitral tribunal may rule on its own jurisdiction, including ruling on any objections with respect to the existence or validity of the arbitration agreement, and for that purpose –

•     (a) an arbitration clause which forms part of a contract shall be treated as an agreement independent of the other terms of the contract; and

• (b) a decision by the Arbitral Tribunal that the contract is null and void shall not entail ipso jure the invalidity of the arbitration clause.”

Section 33 and 35 of the Indian Stamp Act, 1899

Section 33 of the Indian Stamp Act, 1899 reads as under:

•     33. Examination and impounding of instruments – (1) Every person having by law or consent of parties, authority to receive evidence, and every person in charge
of a public office, except an officer of police, before whom any instrument, chargeable,in his opinion, with duty, is produced or comes in the performance of his functions, shall, if it appears to him that such instrument is not duly stamped, impound the same.

•     (2) … (3) …

Section 35 of the Indian Stamp Act, 1899 reads as under:

•     35. Instruments not duly stamped inadmissible in evidence, etc. – No instrument
chargeable with duty shall be admitted in evidence for any purpose by any person having by law or consent of parties authority to receive evidence, or shall be acted upon, registered or authenticated by any such person or by any public officer, unless such instrument is duly stamped:

•     Provided that – (a) any such instrument shall, be admitted in evidence on payment of the duty with which the same is chargeable, or, in the case of an instrument insufficiently stamped, of the amount required to make up such duty, together with a penalty of five rupees, or, when ten times the amount of the proper duty or deficient portion thereof exceeds five rupees, of a sum equal to ten times such duty or portion;

(b) …. (c) ….. (d) …. (e) …..

PART III - Decisive Earlier Decisions

SBP and Co. v. Patel Engg. Ltd.

Our Apex Court had occasion to consider the apparent inconsistency between Section 16and Section 11 of the Arbitration Act, inSBP and Co. v. Patel Engg.Ltd. (2005 (4)
KLT OnLine 1111 (SC).

•     Section 16 enjoins the Arbitral Tribunal ‘to rule on its own jurisdiction’, including ruling on any objections with respect to the ‘existence or validity’ of the arbitration agreement and it is made clear that the arbitration clause shall be treated as an agreement independent of the other terms of the contract.

•     Section 11(7) conferred finality to the decision of the Chief Justice, as regards the ‘reference’ to arbitration.

The explanation placed by the learned Senior Counsel, Mr.K.K.Venugopal, was pointed out by the Court.  He argued that Section 16 had ‘full play’ only when an Arbitral Tribunal was constituted without intervention under Section 11.

In SBP and Co. our Apex Court held as under:

•     “Prima facie, it would be difficult to say that in spite of the finality conferred by sub-section (7) of Section 11 of the Act, to such a decision of the Chief Justice, the Arbitral Tribunal can still go behind that decision and rule on its own jurisdiction or on the existence of an arbitration clause.”

In Garware Wall Ropes Ltd. v. Coastal Marine Constructions & Engg.Ltd.(2019 (2) KLT OnLine 3125 (SC) it was observed as under:

•     “It is settled bySBP & Co. that Section 16 of the 1996 Act has full play only after the Arbitral Tribunal is constituted, without intervention of the Court under Section 11.”

Garware Wall Ropes Ltd. v. Coastal Marine Constructions & Engg. Ltd.

As regards the enforceability of an unstamped agreement and the bifurcation of an arbitration clause, it is held in Garware Wall Ropes Ltd. v. Coastal Marine Constructions & Engg. Ltd.(2019 (2) KLT OnLine 3125 (SC), as under:

• “... A close look at Section 11(6A) would show that when the Supreme Court or the High Court considers an application under Sections 11(4) to 11(6), and comes across an arbitration clause in an agreement or conveyance which is unstamped, it is enjoined by the provisions of the Stamp Act to first impound the agreement or conveyance and see that stamp duty and penalty (if any) is paid before the agreement, as a whole, can be acted upon. It is important to remember that the Stamp Act applies to the agreement or conveyance as a whole. Therefore,it is not possible to bifurcate the arbitration clause contained in such agreement or conveyance so as to give it an independent existence, as has been contended for by the respondent. The independent existence that could be given for certain limited purposes, on a harmonious reading of the Registration Act, 1908 ... “

• “22. When an arbitration Clause is contained “in a contract”, it is significant that the agreement only becomes a contract if it is enforceableby law.We have seen how,under the Indian Stamp Act, an agreement does not become a contract, namely, that it is not enforceable in law, unless it is duly stamped. Therefore, even a plain reading of
Section 11(6A), when read with Section 7(2) of the 1996 Act and Section 2(h) of the Contract Act, would make it clear that an arbitration Clause in an agreement would not existwhen it is not enforceable by law. This is also an indicator that SMS Tea Estates has, in no manner, been touched by the amendment of Section 11(6A).”

“29. This judgment in Hyundai Engg.case is important in that what was specifically under consideration was an arbitration Clause which would get activated only if an insurer admits or accepts liability. Since on facts it was found that the insurer repudiated the claim, though an arbitration Clause did “exist”, so to speak, in the policy, it would not exist in law, as was held in that judgment, when one important fact is introduced, namely, that the insurer has not admitted or accepted liability. Likewise, in the facts of the present case, it is clear that the arbitration Clause that is contained in the sub-contract would not “exist” as a matter of law until the sub-contract is duly stamped, as has been held by us above. The argument that Section 11(6A) deals with “existence”, as opposed to Section 8, Section 16,
and Section 45, which deal with “validity” of an arbitration agreement is answered by this Court’s understanding of the expression “existence” in Hyundai Engg.Case as followed by us.”

Vidya Drolia v. Durga Trading Corporation

Vidya Drolia v. Durga Trading Corporation(2020 (6) KLT OnLine 1025 (SC) made it clear-

•     For appointing an arbitrator, Courts shall make a prima facie ‘finding’ under Section 11(6A) as to “Non­-arbitrability of disputes”; and 

•     the prima facie examination is to make a “check”and to protect parties from being forced to arbitrate when the matter is demonstrably “non-­arbitrable”.

It is held in Vidya Drolia v. Durga Trading Corporation (2020 (6) KLT OnLine 1025 (SC) = as under:

• “133. Prima faciecase in the context of Section 8 is not to be confused with the merits of the case put up by the parties which has to be established before the Arbitral Tribunal. It is restricted to the subject-matter of the suit being prima facie arbitrable under a valid arbitration agreement. Prima facie case means that the assertions on these aspects are bona fide.

• 134. Prima facie examination is not full review but a primary first review to weed out manifestly and ex facie non-existent and invalid arbitration agreements and non-arbitrable disputes. The prima facie review at the reference stage is to cut the deadwood and trim off the side branches in straight forward cases where dismissal is barefaced and pellucid and when on the facts and law the litigation must stop at the first stage. Only when the court is certain that no valid arbitration agreement exists or the disputes/subject-matter are not arbitrable, the application under Section 8 would be rejected. At this stage, the court should not get lost in thickets and decide debatable questions of facts. Referral proceedings are preliminary and summary and not a mini trial… …

• 139. … Conversely, if the court becomes too reluctant to intervene, it may undermine effectiveness of both the arbitration and the court. There are certain cases where the prima facieexamination may require a deeper consideration. The court’s challenge is to find the right amount of and the context when it would examine the prima facie case or exercise restraint. The legal order needs a right balance between avoiding arbitration obstructing tactics at referral stage and protecting parties from being forced to arbitrate when the matter is clearly non-arbitrable.”

The Apex Court further observed as under:

• “146. We now proceed to examine the question, whether the word “existence” in Section 11 merely refers to contract formation (whether there is an arbitration agreement) and excludes the question of enforcement (validity) and therefore the latter falls outside the jurisdiction of the court at the referral stage. On jurisprudentially and textualism it is possible to differentiate between existence of an arbitration agreement and validity of an arbitration agreement. Such interpretation can draw support from the plain meaning of the word “existence”. However, it is equally possible, jurisprudentially and on contextualism, to hold that an agreement has no existence if it is not enforceable and not binding. Existence of an arbitration agreement presupposes a valid agreement which would be enforced by the court by relegating the parties to arbitration. Legalistic and plain meaning interpretation would be contrary to the contextual background including the definition clause and would result in unpalatable consequences. A reasonable and just interpretation of “existence” requires understanding the context, the purpose and the relevant legal norms applicable for a binding and enforceable arbitration agreement. An agreement evidenced in writing has no meaning unless the parties can be compelled to adhere and abide by the terms. A party cannot sue and claim rights based on an unenforceable document. Thus, there are good reasons to hold that an arbitration agreement exists only when it is valid and legal.A void and unenforceable understanding is no agreement to do anything. Existence of an arbitration agreement means an arbitration agreement that meets and satisfies the statutory requirements of both the Arbitration Act and the Contract Act and when it is enforceable in law.

• 147. We would proceed to elaborate and give further reasons:

• 147.1. In Garware Wall Ropes Ltd. (Garware Wall Ropes Ltd. v. Coastal Marine Constructions & Engg. Ltd. (2019 (2) KLT OnLine 3125 (SC) this Court had examined the question of stamp duty in an underlying contract with an arbitration clause and in the context had drawn a distinction between the first and second part of Section 7(2) of the Arbitration Act, albeit the observations made and quoted above with reference to “existence” and “validity” of the arbitration agreement being apposite and extremely important, we would repeat the same by reproducing para 29 thereof (2018 (3) KLT OnLine 3066 (SC).

• “29. This judgment in Hyundai Engg. case (United India Insurance Co. Ltd. v. Hyundai Engg. & Construction Co. Ltd. (2018 (3) KLT OnLine 3066 (SC) is important in that what was specifically under consideration was an arbitration clause which would get activated only if an insurer admits or accepts liability. Since on facts it was found that the insurer repudiated the claim, though an arbitration clause did “exist”, so to speak, in the policy, it would not exist in law, as was held in that judgment, when one important fact is introduced, namely, that the insurer has not admitted or accepted liability. Likewise, in the facts of the present case, it is clear that the arbitration clause that is contained in the sub-contract would not “exist” as a matter of law until the sub-contract is duly stamped, as has been held by us above. The argument that Section 11(6-A) deals with “existence”, as opposed to Section 8, Section 16 and Section 45, which deal with “validity” of an arbitration agreement is answered by this Court’s understanding of the expression “existence” in Hyundai Engg.case (United India Insurance Co. Ltd. v. Hyundai Engg. & Construction Co.Ltd.
(2018 (3) KLT OnLine 3066 (SC) as followed by us.”

•  Existence and validity are intertwined, and arbitration agreement does not exist if it is illegal or does not satisfy mandatory legal requirements. Invalid agreement is no agreement.”

• “153. Accordingly, we hold that the expression ‘existence of an arbitration agreement’ in Section 11 of the Arbitration Act, would include aspect of validity of an arbitration agreement, albeit the court at the referral stage would apply the prima facie test on the basis of principles set out in this judgment. In cases of debatable and disputable facts, and good reasonable arguable case, etc., the court would force the parties to abide by the arbitration agreement as the Arbitral Tribunal has primary jurisdiction and authority to decide the disputes including the question of jurisdiction and non-arbitrability.”

•  154.2. Scope of judicial review and jurisdiction of the court under Sections 8 and 11 of the Arbitration Act is identical but extremely limited and restricted.

• 154.4. Rarely as a demurrer the court may interfere at Section 8 or 11 stage when it is manifestly and ex facie certain that the arbitration agreement is non-existent, invalid or the disputes are non-arbitrable, though the nature and facet of non-arbitrability would, to some extent, determine the level and nature of judicial scrutiny. ”

The afore stated passages from Vidya Drolia v. Durga Trading Corporation (2020 (6) KLT OnLine 1025 (SC), is quoted and followed in NTPC Ltd. v. SPML Infra Ltd. (2023 KLT OnLine 1428 (SC)).

BSNL and Anr. v. Nortel Networks India (P) Ltd.

In BSNL & Anr. v. Nortel Networks India (P) Ltd. (2021 (2) KLT SN 37 (C.No. 34) SC =  2021 (2) KLT OnLine 1008 (SC)),it is held held as under:

• “45.1 …While exercising jurisdiction under Section 11 as the judicial forum, the court may exercise the prima facie test to screen and knockdown ex faciemeritless, frivolous, and dishonest litigation. Limited jurisdiction of the courts would ensure expeditious and efficient disposal at the referral stage. At the referral stage, the Court can interfere “only” when it is “manifest” that the claims are ex facie time-barred and dead, or there is no subsisting dispute…” (quoted and followed in NTPC Ltd. v. SPML Infra Ltd. (2023 KLT OnLine 1428 (SC)).

NTPC Ltd. v. SPML Infra Ltd.

NTPC Ltd. v. SPML Infra Ltd. (2023 KLT OnLine 1428 (SC)), without changing the foun-dations laid down by the Apex Court in earlier decisions, Dr.D.Y.Chandrachud, C.J.I., made clear the position of law with clarity and emphasis. It is observed as under:

• “24. Following the general rule and the principle laid down in Vidya Drolia (supra), this Court has consistently been holding that the Arbitral Tribunal is the preferred first authority to determine and decide all questions of non-arbitrability. In Pravin Electricals Pvt. Ltd. v. Galaxy Infra and Engg. Pvt. Ltd. (2021 (2) KLT SN 30 (C.No.28) SC =2021 (2) KLT OnLine 1007 (SC)), Sanjiv Prakash v. Seema Kukreja (2021 (2) KLT OnLine 1040 (SC) and Indian Oil Corporation Ltd. v. NCC Ltd. (2022 (4) KLT OnLine 1084 (SC), the parties were referred to arbitration, as the prima facie review in each of these cases on the objection of non-arbitrability was found to be inconclusive. Following the exception to the general principle that the court may not refer parties to arbitration when it is clear that the case is manifestly and ex facie non-arbitrable, in BSNL and Anr. v. Nortel Networks India (P) Ltd. (2021 (2) KLT SN 37 (C.No. 34) SC = 2021 (2) KLT OnLine 1008 (SC)  and Secunderabad Cantonment Board v. B. Ramachandraiah (2021 (2) KLT OnLine 1116 (SC)), arbitration was refused as the claims of the parties were demonstrably time-barred.

• 25. Eye of the Needle: The above-referred precedents crystallise the position of law that the pre-referral jurisdiction of the courts under Section 11(6) of the Act is very narrow and inheres two inquiries. The primary inquiry is about the existence and the validity of an arbitration agreement, which also includes an inquiry as to the parties to the agreement and the applicant’s privity to the said agreement. These are matters which require a thorough examination by the referral court. The secondary inquiry that may arise at the reference stage itself is with respect to the non-arbitrability of the dispute.

27. The standard of scrutiny to examine the non-arbitrability of a claim is only prima facie. Referral courts must not undertake a full review of the contested facts; they must only be confined to a primary first review and let facts speak for themselves. This also requires the courts to examine whether the assertion on arbitrability is bona fide or not. The prima facie scrutiny of the facts must lead to a clear conclusion that there is not even a vestige of doubt that the claim is non-arbitrable. On the other hand, even if there is the slightest doubt, the rule is to refer the dispute to arbitration.

28. The limited scrutiny, through the eye of the needle, is necessary and compelling. It is intertwined with the duty of the referral court to protect the parties from being forced to arbitrate when the matter is demonstrably non-arbitrable. It has been termed as a legitimate interference by courts to refuse reference in order to prevent wastage of public and private resources. Further, as noted in Vidya Drolia (supra), if this duty within the limited compass is not exercised, and the Court becomes too reluctant to intervene, it may undermine the effectiveness of both, arbitration and the Court. Therefore, this Court or a High Court, as the case may be, while exercising jurisdiction under Section 11(6) of the Act, is not expected to act mechanically merely to deliver a purported dispute raised by an applicant at the doors of the chosen arbitrator, as explained in DLF Home Developers Limited v. Rajapura Homes Pvt. Ltd. (2021 (5) KLT OnLine 1139 (SC).″

PART III - Conclusion

In N.N. Global Mercantile (P) Ltd. v. Indo Unique Flame Ltd.  taking note of the divergence in the debated points, among Judges, it is observed by Hrishikesh Roy, J., one of the (two) Judges who dissented from the view of the majority, laid down the following-

 “… Let our minority opinion (self and Learned Brother Justice Ajay Rastogi, who has written a separate opinion), appeal to the brooding spirit of the future as also the powers of the legislature to examine the interplay between the Arbitration and Conciliation Act, 1996 and the Indian Stamp Act, 1899; and to emphatically resolve the imbroglio to avoid any confusion in the minds of the stakeholders in the field of arbitration.”

Let the pointers be that as it may.

In any event, the legislatures (and the courts also) – as they are duty bound to ponder the welfare of the ‘downtrodden which is the majority’ – will have to consider whether the following are ground realities-

•     1. The majority of Execution Petitions that come before the Execution (civil) Courts are for realisation of amounts below Rupees 10 Lakh ; and the lion’s share of it is
filed by the persons who are engaged, directly or indirectly, in Money Lending activity, or initiated by similar “Service Providers”; and the opposite parties thereof belong (comparatively) to lower strata.  

•     2. A large number of Execution Petitions that come before the Execution (civil) Courtsare that from the uncontested Arbitration Awards from “Outside-States”.

 •    3.There is no effective “legal frame” (rules) for fixing remuneration of the Arbitrators.

RETENTION OF TALENT IS MORE IMPORTANT THAN SELECTION

Good Employee is an Asset

Although hiring good employees is a nightmare but it is more difficult to retain the employees. Talent management is the key area in every company worth its HR department and the CEO are more worried about intellectual capital than working capital.

By Advocate H.L. Kumar

Few years ago If you’d have asked the senior executives what their company’s most valuable assets were, chances are they would have talked about the brand, goodwill, plant and machinery and so on. But ask them this question today, and ‘people’ will most likely figure in the ensure. An organisation is made up of competencies which we can loosely call ‘capital’. Its key components are ‘customer capital’, ‘structural capital’. and ‘human capital’.

In this era of globalisation and modernization, organisations are becoming increasingly competitive, dynamic, innovative and productive. Globalisation has certainly thrown new challenges before HR persons as they have to prepare employees to meet the challenges of knowledge-based economy and to respond to the dynamics of the work environment with technological skill and a high level of thinking. They too, in fact, assure the role of business development managers and evolve themselves as service providers to their internal and external customers.

Just as it is vital for every establishment to attract the right talent, it is equally important for them to retain that talent. Today’s situation is such that companies are constantly vying with each other to offer better perks to their employees. While the nature of these perks may differ across levels, there is a need to offer something beyond just the pay packages. Stock options, exposure to other markets, substantial incentives on meeting targets foreign trips - these are all initiatives that have gained a lot of acceptance in the last few years. And this does go a long way in retaining people. It is important for one to keep in mind that it is not healthy for organizations to face attrition on a reasonably regular basis.

The challenges before all kinds of companies are the same today retaining talent by taking the workplace a consistently challenging and motivating arena, providing opportunities for growth through training, travel nurturing the entrepreneurial streak, and above all, proving that you are an employer who cares about every aspect of their lives.  The industry is changing every day and if you don’t keep up, you are left behind.  Insecurity levels are very high, which is why people want to work with organisations that allow them to train and learn the latest.  Indian or MNC, the primary factor to force an employee to get up every morning and come back to the same workplace for years is a challenging and motivating environment.

The unbridled growth of the new economy, the emergence of the knowledge worker and the high demand for talent in the domestic and global markets have rewritten the rules of the game.  Though hiring good employees is a nightmare, it is more difficult to retaining good employees.  Talent management is the key area in every company worth its HR department and CEOs are more worried about intellectual capital than working capital.  To add to the problems are the huge packages being doled out at all levels.

The accent today is more and more on the individual employee.  Companies that nurture its employees and provide them with continuous opportunities for self-development and tap their entrepreneurial streak have a tangible edge over their competitors.

Very recently, Piramal Group has introduced a comprehensive retention plan aimed at bolstering employee engagement and retaining top talent.  Under the new scheme, 280 mid and senior executives will get long term incentives compared to 70 of the top brass earlier. The company’s initiative reflects the growing demand for experienced senior professionals in financial and pharmaceutical sector.

“From around 70 top leaders, mostly reporting to CXOs and business heads we are now offering long-term incentives to around 280 mid to senior level executives.  This marks a four-fold increase in the number of employees benefiting from this program across our three businesses,” Vikram Bector, chief human resources officer, Piramal Group said in an interview.

Long-term incentives (LTI) are typically designed to retain and attract talent and spans three-plus years, Consultants said LTI and stock options are key components of compensation in established business.

“LTIs provide wealth-creation opportunity and helps a company woo good talent from other sectors like IT product firms, where stocks and incentive programmes are offered to even junior executives”, said Jang Bahadur Singh, director of human capital solutions at consulting firm Aon in India.

“Young talent coming in from early-stage organizations, look at equity plans, and LTIs work well,” he added.

Other business houses are also offering stocks options for the senior brass for their new ventures.

Aditya Birla Group venture TMRW has rolled out equity options for its new top brass, while rival Tata Digitial, the e-commerce unit of the $103-billion Tata group, is courting senior execs with long-term incentives to secure the loyalty of it most valuable resources and woo new talent.

The Sabina Conundrum – Judicial Restraint on the Kerala

Conservation of Paddy Land and Wetland Act, 2008

(By B.Premnath, Advocate, High Court of Kerala)

The Judgment of the Full Bench of the High Court of Kerala in Sabeena v. District Collector and connected cases¹, which imposes additional restrictions on the use of paddy land, is wrong, and is an encroachment into the territory of the legislature.

The Full Bench in Sabina¹ held that: “the purchaser of a bit of paddy land, subsequent to the introduction of the Kerala Conservation of Paddy Land and Wetland Act, 2008, is not entitled to get the benefit of Section 5(3) read with Section 9 of the Act, 2008  and“the owner of the paddy land who is entitled to seek conversion or reclamation in contemplation of the provisions of Act, 2008 is the owner of the paddy land on the date of coming into force of the Act, 2008, i.e., 12.08.2008”. By declaring so, the Courthas gone beyond the purpose and intent of the Kerala Conservation of Paddy Land and Wetland Act, 2008.

It is discernible from the Statement of Objects and Reasons, that Act 2008 is enacted to restrict the unbridled reclamation and conversion of the paddy land from 12.8.2008.
Section 3 of the Act 2008 does not prohibit purchase of paddy land after 2008, and also does not prohibit construction of a residence in the said paddy land. Section 3 of the Act 2008 declares that: “on and from the date of commencement of this Act, the owner, occupier or the person in custody of any paddy land shall not undertake any activity for the conversion or reclamation of such paddy land except in accordance with the provisions of this Act”. In plain language, it only means that any conversion or reclamation in a paddy land after 2008 shall be only as per the provisions of the Act 2008. It only has a prospective application.

Section 5(3) is the repository of the power for the local level monitoring committee to recommend reclamation of paddy land for construction of residential building for the owner of the paddy land, in Panchayath area and Municipality/Corporation area, as the case may be. It is qualified by other conditions prescribed. Section 9 authorizes the district level monitoring committee to grant permission for filling up the paddy land for construction of residential building subject to the other provisions, especially Section 9(8) which imposes stringent conditions for considering the applications for reclamation. Section 9(8) reads as follows:- “Notwithstanding anything contained in sub-section (1), no application shall be considered by the District Level Authorised Committee, unless the Local Level Monitoring Committee has recommended that,- (i) such reclamation shall not adversely affect the ecological condition and the cultivation in the adjoining paddy land; (ii) the owner of the paddy land or his family do not own a suitable land for this purpose in that District; (iii) the building to be constructed is for his own purpose; and (iv) such paddy land is not surrounded by other paddy lands.”

The impact of the judgement of the Full Bench is that, the purchaser of a paddy land after 12.8.2008, a farmer or to be a farmer or not a farmer, cannot construct a residential building of his own in the said land, even if he is homeless and satisfies the conditions under Sections 5(3) and 9 of the Act 2008. If there is no restriction for the purchase of paddy land after the Act 2008 as the Full Bench rightly held, it is wrong in prohibiting the construction that is permitted by the Act 2008 through the provisions under Sections 5(3) and 9 and limiting the conversion or reclamation of the paddy land only to the owner of the said land on the date of coming into force of the Act 2008.

The judgement of the Full Bench in Sabina¹ is not merely a declaration of law, but legislation. Hon’ble Supreme Court in P.Ramachandra Rao v. State of Karnataka² held that: “Legislation is that source of law which consists in the declaration of legal rule by a competent authority. When Judges by judicial decisions lay down a new principle of general application of the nature specifically resolved for the legislature, they may said to have legislated, and not merely declared the law.”

Sabina¹ even amounts to excessive legislation. On the limits of Judges legislating, Justice Oliver Wendell Holmes remarked: “Without hesitation that Judges do and must legislate, but they can do so only interstitially; they are confined from molar to molecular motions”.

The Full Bench has drawn support from the judgments of the Supreme Court in Ambika Prasad Mishra v. State of U.P.³ and Sonia Bhatia v. State of U.P. ⁴. Ambika Prasad Mishra’and Sonia Bhatia’ dealt with the interpretation of the Uttar Pradesh Imposition of Ceiling on Land Holdings Act, 1960, which was enacted to provide for more equitable distribution of land by making the same available to the extent possible to landless agricultural labourers and to provide for cultivation, up reserve stock of food grains against lean years, by imposing a ceiling on large land holdings.

The relevant provision in the U.P. Act, Section 5(6), make any transfer of any surplus land which would have been declared so, as invalid after 24.01.1971, but at the same time exempts transfer in favour of any person (including Government) referred to in Section 5(2) and a transferproved to the satisfaction of the prescribed authority to be in good faith and for adequate consideration and under an irrevocable instrument not being a benami  transaction or for immediate or deferred benefit of the tenure-holder or other members of the family.

Ambika Prasad Mishra³repelled the challenge to the U.P. Act, given its laudable object. Sonia Bhatia⁴ excluded a gift on the facts of that case, from the purview of the proviso to Section 5(6) which contained the exceptions from the applicability to Section 5(6).

The object of the U.P. Act, 1960, is to preserve land for the landless agricultural labourers, declaring any transfer of land invalid, after 24.1.1971, but provided exceptions to genuine land transactions. There is no total bar on alienation of land. The exceptions in the U.P. Act 1960 and the restriction in the conversion/reclamation/construction in the Act 2008, are to be construed strictly. Beyond that, the restriction of transfer of land after 24.1.1971 in the U.P. Act, 1960 cannot be imported into the Paddy Land Act 2008 to hold that there cannot be any construction in a paddy land purchased after 12.8.2008. That is a far cry from the scope and object of the Act 2008.  

As quoted by the Full Bench from Ambika Prasad Mishra³, it is perfectly open to the legislature, as ancillary to its main policy to prevent activities which defeat the statutory purpose, to provide for invalidation for the actions. Act 2008 only impose a ceiling on the extent of land in which construction is permitted, subject to further restrictions in the form of S.5(3) and S.9(8). True, the emphasis is on the farmer/tiller of the paddy land, to promote cultivation. And if he has no house/residence in the Panchayath or Municipal/Corporation area, he is permitted to reclaim a limited extent of the paddy land, to construct a residential building. This in turn allows him to carry on paddy cultivation in his existing paddy land or in a paddy land which was purchased after 12.8.2008.

The Full Bench held that “the intention was to protect and maintain the existing paddy lands already included in the Data Bank and which remained as such when the Act came into force”. It is true that the language of Section 27A is to prohibit construction/reclamation/conversion of paddy land. But then it can be read only along with Sections 3, 5(3) and 9 of the Act 2008 which permits construction of residential building for the owner of the paddy land.

The example cited in the judgment that if the owner of one acre of paddy land sells it to 10 purchasers and if they are permitted to make an application seeking reclamation of the land in contemplation of Section 5(3) read with Section 9 of the Act 2008, the prohibition in Section 3 of the Act 2008, can be easily flouted, is a fallacy. If there are purchasers for 10 cents each or plots of different extents, they can construct residence/house in the said lands only subject to the restrictions in the Act 2008, especially under Section 9(8). All such tracts of land cannot get over the restrictions prescribed under Section 9(8).

A situation may arise when a farmer/to be farmer who do not have a house of his own, intends to settle down in his home town, purchases a paddy land after 12.08.2008, to which there is no restriction. He has a genuine intention to carry on farming. He wants to promote farming. He purchases 1 acre of paddy land. He is permitted under the Act 2008 to construct a house of his own in the paddy land after going through the rigours, after complying with the provisions under the Act 2008. But now he cannot, because he is restrained by a judicial fiat. The Full Bench failed to remind itself that the only mischief the Act 2008 intended to remedy was the indiscriminate filling up of paddy land and to promote the cultivation, and permit the owner of the paddy land to construct a house therein, if he has none in the same locality.

The Full Bench judgement in Sabina¹has gone beyond what the Honourable Supreme Court said in Union of India v. Elphinstone Spinning and Weaving Co. Ltd. & Others⁵:-
“Courts are not entitled to usurp legislative function under the guise of interpretation and they must avoid the danger of determining the meaning of a provision based on their own pre-conceived notions of ideological structure or scheme into which the provisions to be interpreted is somehow fitted. Caution is all the more necessary in dealing with a legislation enacted to give effect to policies that are subject to bitter public and parliamentary controversy for in controversial matters there is room for differences of opinion as to what is expedient, what is just and what is morally justifiable; it is Parliament’s opinion in those matters, that is paramount”.

The term “owner”, “occupier” or “person in custody of a paddy land” are not defined under the Act, 2008. “Holder of a paddy land” is defined under Section 2(viii) of the Act 2008, as “person holding any paddy land whether as owner or under a legal right”. It is an expansive definition. The legislature envisaged a situation where the paddy land would be leased, licensed, sold or another person would hold it as an agent on behalf of the owner. The term “holder of a paddy land”, is extensively used in Section 16 which contains provisions to cultivate the fallow paddy land.

A survey of the provisions of the Act 2008 reveals that detailed procedures are contemplated in Sections 5, 8 and 9 for filling up of paddy land for constructing of residential building. Sufficient care has been taken by the legislature to promote the objectives of the Act 2008. There are reporting officers in the form of agricultural officers to point out any violation of the provisions of the Act, 2008. Omission to report is also made an offence under Section 23.  Section 12 permits the authorized officer under the Act, 2008, to take measures to prevent the commission of any offences under the Act. Section 13 ordains the District Collector with the power to restore the reclaimed paddy land. The local authority cannot grant license/permit to carry out any activity/construction in a paddy land to convert or reclaim in contravention of the provisions of the Act 2008. Section 15 required the local level monitoring committee to direct the owner to cultivate the paddy land which is left uncultivated and fallow. Section 16 describes the manner in which the fallow paddy land to be cultivated. Section 17 contain provisions to activate the cultivation of a paddy land. Section 18 authorizes the District Collector to initiate proceedings for compliance of the provisions of the Act, 2008.

Sections 19 and 20 deals with the power of entry and seizure and confiscations of vessel, vehicle, which is used in committing acts in violation of the provisions of the Act 2008. Sections 22, 23, 24 deals in punishments and Section 26 bars the resort to Civil Courts for the acts done/purporting to be done by the Government or its officers under the Act, 2008. Section 27 declared that sums recoverable under the Act 2008, as arrears of land revenue. Section 27D moots creating an “Agricultural Promotion Fund”.

Thus Act 2008 contain safeguards to prevent indiscriminate filling up/conversion/reclamation/construction in the paddy land. Legislature knows the Will of the people. A law is presumed to be constitutional. What the Full Bench has done, is to read and write into the Act 2008 the provisions which are not there.

The Supreme Court in Elphinstone⁵ case, reminds: “While examining a particular statute for finding out the legislative intent it is the attitude of Judges in arriving at a solution by striking a balance between the letter and spirit of the statute without acknowledging that they have in any way supplemented the statute would be the proper criterion. The duty of Judge is to expand and not to legislate. There is no doubt a marginal area in which the Courts mould or creatively, interpret legislation and they are thus finishers, refiners and polishers of legislations which comes to them in a state requiring various degrees of further processing. But a Judge is not entitled to add something more than what is there in the statute by way of a supposed intention of the legislature.It is therefore, a Cardinal Principle of interpretation of statutes that the true or legal meaning of an enactment is derived by considering the meaning of the words used in the enactment in the light of any discernible purpose or object which comprehends the mischief and its remedy to which the enactment is directed”.

Benjamin Cardozo⁶ cautions : “In countless litigations, the law is so clear that Judges have no discretion. They have the right to legislate within gaps, but often there are no gaps. We shall have a false view of the landscape if we look at the waste spaces only, and refuse to see the acres already sown and fruitful. I think the difficulty has its origin in the failure to distinguish between right and power, between the command embodied in a judgement and the jural principle to which the obedience of the Judge is due. Judges have of course, the power, though not the right, to ignore the mandate of a statute, and render judgement despite of it.”

Let the final sentinel step into correct the Full Bench. 

REFERENCES

1.2022 (2) KLT 551 (F.B.).

2.2002 (2) KLT 189 (SC) = (2002) 4 SCC 578.

3.1980 KLT OnLine 1024 (SC) = (1980) 3 SCC 719.

4.1981 KLT OnLine 1020 (SC) = (1981) 2 SCC 585.

5.2001 (1) KLT OnLine 1004 (SC) = (2001) 4 SCC 139.

6. Nature of Judicial Process.