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DECEMBER 2022 WRAP UP: 22 captivating judgments of Tribunals, Regulatory Bodies and Commissions

   

APPELLATE TRIBUNAL FOR ELECTRICITY (‘ATE’)

Principle that governs compensating a party for the time value for money would be applied for grant of interest on carrying cost on account of a change in law event; Appellate Tribunal for Electricity reiterates

In an appeal for compensation in terms of change in law in the Power Purchase Agreement (‘PPA’) against the order passed by the Rajasthan Electricity Regulatory Commission (‘State Commission’) wherein it gave its view on the claim of ‘carrying cost’. The bench of R.K. Gauba (Officiating Chairperson) and Sandesh Kumar Sharma (Technical Member) set aside the order of the State Commission, directing it to render fresh decision expeditiously.

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ARMED FORCES TRIBUNAL (‘AFT’)

Armed Forces Tribunal | Once policy and rules were followed in matters of appointments in the Armed Forces, sympathy cannot be a substitute to grant benefit to a person

In an application seeking to quash the order discharging the applicant from service on the ground “unlikely to make an efficient Airman” under Chapter III Clause 15(2)(j) of the Air Force Rules, 1969 (‘AF Rules’), two-member bench of Rajendra Menon, J. and Lieutenant General P.M. Hariz held that neither was there any violation of the principles of natural justice nor the applicant was denied adequate opportunity before taking action, which allegedly has vitiated the proceedings. Further, once the requirements of the policy and rules were followed in matters of appointments to sensitive posts in the Armed Forces, sympathy cannot be a substitute to act in violation to the laid down administrative policies and grant benefit to a person.

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CENTRAL INFORMATION COMMISSION (‘CIC’)

CIC expresses severe displeasure over the conduct of PIO for denying providing of information on 2022 DDA Policy

The complainant being dissatisfied with the information being provided by the First Appellate Authority, filed a complaint before the Central Information Commission (‘The Commission’) wherein the Information Commissioner, Heeralal Samariya held that prima facie the case of denial of information is made out against the Public Information Officer (‘PIO’) for not providing appropriate reply to the Right To Information (‘RTI’) Application regarding residential plots allotted by Delhi Development Authority (‘DDA’) on leasehold basis which are misused for commercial activity, and accordingly the ‘misuse charges’ levied by DDA on such properties.

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CUSTOMS, EXCISE AND SERVICE TAX APPELLA TRIBUNAL (‘CESTAT’)

CESTAT exempts All India Football Federation from paying service tax in accordance with the tripartite agreement between parties

The bench of Anil Choudhary (Judicial Member) and P.V. Subba Rao (Technical Member), while deciding the appeal filed by All India Football Federation (‘AIFF’) against the order passed by the Central Board and Service Tax, Audit-II, held that AIFF had concurred to the agreement, whereby the rights were transferred from Zee Entertainment Enterprises Pvt. Ltd. (‘ZEEL’) to IMG Reliance Pvt. Ltd (‘IMGR’) which does not amount to rendering any service.

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INCOME TAX APPELLATE TRIBUNAL (‘ITAT’)

ITAT| Hospitals providing medical facilities on a commercial basis are not charitable organisations; Not exempted from income tax

In appeals against the order of Commissioner of Income Tax(‘CIT’), involving proceedings under Section 12-AA(1)(b)(ii), 80-G(5)(vi) and 10(23C)(vi) of Income Tax Act, 1961 (‘the Act’), two-member bench of Rama Kanta Panda and Laliet Kumar upheld the order of CIT and held that as the hospital (assessee) is charging on the basis of commercial rates from the patients, therefore it is not entitled to registration as a charitable organisation under Section 12-A of the Act.

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NATIONAL COMPANY LAW APPELLATE TRIBUNAL (‘NCLAT’)

Approval/Non-approval of Resolution Plan is a commercial wisdom and Tribunal can’t interfere with the commercial wisdom: NCLAT

Dismissing the appeal, Ashok Bhushan, J., Kanthi Narahari (Technical Member) and Barun Mitra (Technical Member) held that when a Resolution Plan is approved by the CoC, it is presumed that the approval was given to a viable and feasible plan.

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NCLAT | Application under Section 7 IBC relating to the interest component due even if principal amount is not due, held maintainable

Upholding the maintainability of an application filed under S. 7 IBC, a bench comprising of Rakesh Kumar Jain, J. (Judicial Member) and Naresh Salecha (Technical Member) held that an application filed under S. 7 IBC could be maintained in respect of the component of interest which became due and payable, without asking for the principal amount which has not yet become due and payable.

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Tyre Cartelization Matter | NCLAT remanded matter back to CCI; asks to review fines to save domestic tyre industry

In a landmark judgment related to cartelization activities of five major domestic tyre manufactures and their association namely Apollo, MRF, Ceat, JK Tyre, Birla Tyres, dating back around 10 years ago, a bench comprising of Rakesh Kumar, J. (Judicial Member) and Dr. Ashok Kumar Mishra (Technical Member) remanded back the tyre cartel matter back to Competition Commission of India (CCI) to review the penalty of Rs 1789 crores imposed upon the tyre manufacturers including Automotive Tyre Manufactures Association (ATMA).

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Date of default and acknowledgement are two different events; NCLAT imposes penalty of Rs. 25 lakhs for attempting to stop implementation of a RERA order

While dealing with an appeal challenging the impugned order passed by NCLT, Ashok Bhushan, J., Dr. Alok Srivastava (Technical Member) and Barun Mitra (Technical Member), held that the date of default and acknowledgement are two different events and date of default is not dependent on acknowledgement of debt. The Tribunal imposed a penalty of Rs. 25 Lakh as filing of application under S. 9 IBC was an attempt to stop the implementation of a RERA order.

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NCLAT | Insolvency and Bankruptcy Code does not contemplate lookback period; Information and relevant documents not to be withhold from Liquidator to investigate transactions done even beyond two years from Insolvency Commencement Date

While dealing with an appeal challenging the impugned order passed by NCLT, Anant Bijay Singh, J. and Shreesha Merla (Technical Member), held that the promoters cannot withhold information and necessary documents from the Liquidator as the lookback period is not applicable qua the liquidator.

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NCLAT | No provision for making any modification in the resolution plan; Adjudicating Authority can either approve or reject it

While deciding the appeal, Rakesh Kumar, J., and Dr. Ashok Kumar Mishra (Technical Member) held that the Adjudicating Authority can either approve or reject the resolution plan but cannot modify it.

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Fictional Scheme to benefit few selected related parties; NCLAT upholds Liquidation of Corporate Debtor

A bench comprising of Ashok Bhushan, J., Dr. Alok Srivastava (Technical Member) and Barun Mitra (Technical Member) held that the appellant’s Scheme of Compromise and Arrangement appears to be doubtful as it seems to be an attempt to inflate the pay outs to related parties.

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Plea of pre-existing dispute must co-relate with amount claimed by Operational Creditor: NCLAT

Allowing the appeal as the impugned order is contrary to law, the bench comprising of Rakesh Kumar Jain, J. and Kanthi Narahari (Technical Member) held that for a debtor to take the plea of pre-existing dispute under S. 8(2) the dispute must relate to the claim made by the operational creditor, mere existence of a dispute is not blanket protection under S. 8(2)(a) of the Insolvency and Bankruptcy Code, 2016 (IBC).

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Rule 11 of NCLAT Rules 2016 cannot be invoked even if there is no provision in IBC to deal with certain circumstances: NCLAT

Dismissing the appeals, a bench comprising of Rakesh Kumar Jain, J. and Kanthi Narahari (Technical Member) held that Regulation 26(2) of the CIRP Regulations, 2016 being directory cannot override the power of the CoC which can take the final decision of accepting or rejecting the resolution plan.

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NCLAT | No Liquidator has any ‘personal rights’, to continue in Liquidation Process; Adjudicating Authority can order for replacement of Liquidator

The bench comprising of M. Venugopal, J. and Naresh Salecha (Technical Member) held that the Adjudicating Authority which had the powers to appoint the Liquidator also have the power to remove the ‘Liquidator for any fit, just, valid and proper reasons.

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NATIONAL COMPANY LAW TRIBUNAL (‘NCLT’)

Claims of various stakeholders to be considered by Resolution Professional in accordance with law; NCLT, Chandigarh emphasizes

In a case filed by way of interlocutory applications, wherein various stakeholders prayed for setting aside the resolution plan as it was against the settled law, for the reconsideration of the Committee of Creditors (‘CoC’), a Division Bench of Harnam Singh Thakur, Member (Judicial) and Subrata Kumar Dash, Member (Technical), held that wherever directed, the claims of various stakeholders are to be considered by the Resolution Professional under the relevant provisions of the IBC and in accordance with law.

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NATIONAL COMSUMER DISPUTES REDRESSAL COMMISSION (‘NCDRC’)

Read how a complainant’s acts and omissions vis-a-vis a JCB machine’s accident, led the NCDRC to draw an adverse inference in favour of the Insurer

While deciding the instant revision petition filed by New India Assurance wherein, they had challenged the order passed by the SCDRC, Jaipur, whereby the insurance company was directed to pay to the aggrieved party Rs. 2,27,105/- and Rs. 25,000/- with interest @ 9% p.a. for damages sustained by their JCB machine from allegedly “falling down”; the Bench of Binoy Kumar (Presiding Member) and Justice Sudip Ahluwalia (Member), set aside the order of the State Commission and held that the complainant was not entitled to her insurance claim due to her omission to inform the police of the accident and her total silence in giving any description of the manner in which the accident had taken place, which could only lead to drawing up of an adverse inference against her and in favour of the Insurer’s version that it was actually the case of over-turning.

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NATIONAL GREEN TRIBUNAL (‘NGT’)

NGT | Necessary safeguards to be adopted for safety of the pilgrims and protection of environment at Amarnath

The Principal Bench comprising of Adarsh Kumar Goel (Chairperson), Sudhir Agarwal (Judicial Member), and Senthil Vel (Expert Member) in an application against violation of environmental and safety norms in setting up of tents for pilgrims in dry riverbed near holy cave, Amarnath, Jammu and Kashmir (J&K) held that necessary safeguards should be adopted for safety of the pilgrims and protection of the environment. It further said that apart from having flood protection measures in place and discouraging overnight stay at the cave camp, augmentation of infrastructure is necessary.

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Timeline laid by Supreme Court cannot be extended by NGT: National Green Tribunal

A bench comprising of Adarsh Kumar Goel (Chairperson), Sudhir Agarwal (Judicial Member), JJ., and A. Senthil Vel (Expert Member) held that the timeline laid by Supreme Court in Paryavaran Suraksha v. Union of India, (2017) 5 SCC 326 to handle liquid waste cannot be extended by this Tribunal.

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“Victim should not remain without remedy”; NGT orders factory not to resume work unless compensation paid as per law

A bench comprising of Adarsh Kumar Goel (Chairperson), Sudhir Agarwal (Judicial Member), JJ., and A. Senthil Vel (Expert Member) took suo motu cognizance based on media report about footwear factory fire hazard in outer Delhi’s Narela Industrial Area on 01-11-2022 and directed district magistrate to ensure compensation is paid to the victim within two weeks.

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REAL ESTATE REGULATORY AUTHORITY (‘RERA’)

Builder deliberately not handing over the possession to the allottee despite receiving the whole of consideration; Haryana RERA modifies order of the State Authority to extend due date of delivery of the unit

The bench comprising of Inderjeet Mehta (Judicial Member) and Anil Kumar Gupta (Technical Member), while dealing with the appeal preferred under Section 44(2) of the Real Estate (Regulation and Development) Act, 2016 against the order passed by the Haryana Real Estate Regulatory Authority, Gurugram (‘The Authority’), partly allowed the appeal and modifying the order of the Authority to the extent of changing the due date of delivery of the unit.

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