Connect with us

Legally Speaking

Is Article 32 available against the judiciary?

There is no reference anywhere in the 18 paragraphs of H.M. Seervai’s discussion on the issue to the Constituent Assembly debates which clearly demonstrate that the judiciary is not part of the State under Article 12 of the Indian Constitution.

J. Sai Deepak

Published

on

I n the previous piece, this author had demonstrated through application of principles of interpretation and with the aid of Constituent Assembly Debates (CAD) that the Judiciary does not fall within the meaning of “the State” for the purposes of Article 12. This effectively leads to the conclusion that the Judiciary does not have the Constitutional mandate to interfere with fundamental rights on the ground of either constitutional morality or public morality, both not being the same, in the absence of State action. The judiciary’s preserve is limited to examining the constitutional validity of State action when it is challenged either under Articles 32 or 226 for abridgement of fundamental rights. This also means that while the remedies under Articles 32 and 226 are available against the State since the State can interfere with fundamental rights, the same remedy is not available against the Judiciary when it discharges judicial functions. Does this mean that the Judiciary falls within the definition of State when it discharges executive functions in the exercise of its rule-making powers?

H.M. Seervai has discussed the question of whether the Judiciary attracts the definition of “the State” in 18 Paragraphs (Paragraphs 7.99-7.116) in Volume 1 of the Fourth Edition of Constitutional Law of India from Pages 389-399. His basic premise is that if the Judiciary forms part of the State, it must conform to Article 14 of the Constitution which mandates that the State shall not deny to any person equality before the law or equal protection of the laws within the territory of India. He has contended that since the language of Article 14 has been largely borrowed from the 14th Amendment to the US Constitution, one must consider whether the Judiciary forms part of the State under US law. To make his case, Seervai has cited a textbook on the US Constitution published by the US Congress wherein it has been stated as follows: “A State acts by its legislative, its executive, or its judicial authorities. It can act in no other way…”

Surprisingly, while Seervai has referred to a textbook issued by the US Congress to support his position that the Judiciary forms part of the State, he did not refer to any judgement of the US Supreme Court to make good this position. In any case, primacy must be given to Indian legislative history. Independent of the history of the US Constitution, the second limb of Seervai’s argument is based on his reliance on the inclusive nature of the definition of State under Article 12 to claim that it does not exclude the Judiciary.

However, an inclusive definition too has its own rules of interpretation which, in this case, do not help Seervai’s argument since the absence of any express reference to an important organ such as the Judiciary, despite express references to the Legislature and the Executive at the Union and the State levels, in Article 12 speaks volumes of the legislative intent.

Interestingly, there is no reference anywhere in the 18 Paragraphs of his discussion on the issue to the Constituent Assembly Debates which clearly demonstrate that the Judiciary is not part of the State under Article 12 of the Indian Constitution. After all, one of the rules of interpretation is that if there is ambiguity in a provision and the internal aids of interpretation do not put the ambiguity to rest, reference may be had to external aids such as the history of the provision, in particular legislative debates. The Constituent Assembly Debate of November 25, 1948, which this author had discussed in detail in his previous piece, finds no mention in Seervai’s analysis on the topic. Even the footnotes do not remotely refer to the CAD.

The third limb of Seervai’s argument is that if the highest Court of the land delivers a judgement which violates Article 14, an affected party would be without remedy to challenge the outcome invoking Article 32 if the Judiciary were not to be treated as State under Article 12. To justify this concern, Seervai has quoted the following passage by Justice Frankfurter in Snowden v. Hughes, a judgement delivered by the US Supreme Court in 1944 on the 14th Amendment to the US Constitution:

“And if the highest Court of a State should candidly deny to one litigant a rule of law which it concededly would apply to all other litigants in similar situation, could it escape condemnation as an unjust discrimination and therefore a denial of the equal protection of the laws?”

To answer this question, Seervai has referred to the judgement of a nine-Judge Bench of the Indian Supreme Court delivered in Naresh Shridhar Mirajkar v. State of Maharashtra (1966) wherein eight of the nine Judges held that a judicial order is not open to challenge under Article 32. Only Justice Hidayatullah, in his dissenting judgement, takes a contrary view, which is endorsed by Seervai.

However, the fact remains, that the law laid down by the majority is that a judicial order is not capable of being challenged under Article 32. In fact, in the very same Mirajkar judgement, a reference has been made to a previous decision of a Constitution Bench of the Supreme Court in Premchand Garg v. Exercise Commissioner, U.P (1963) wherein a rule made by the Supreme Court exercising its rule-making power under Article 145 was the subject of a writ petition under Article 32. The fact that this judgement only proves that the exercise of a rule-making power by the Judiciary constitutes a non-judicial action which is capable of being challenged under Article 32, is not lost on either Seervai or Justice Hidayatullah in the Mirajkar case. In fact, they acknowledge this important distinction. And yet, Seervai’s position and that of Justice Hidayatullah is based on a normative approach to Article 32 as opposed to a strictly legal approach which is consistent with legislative history.

Critically, the position in Mirajkar has been followed inA.R.Antulay vs. R.S. Nayak and another (1988), Smt. Triveniben vs. State of Gujarat (1989), Ajit Kumar Barat vs. Secretary, Indian Tea Association and others, and Rupa Ashok Hurra vs Ashok Hurra & Anr (2002), making it abundantly clear that the law as it stands does not treat judiciary in exercise of judicial powers as State, and therefore does not permit a challenge under Article 32 to judicial verdicts.

What is even more pertinent is that in the Antulay Judgement as well as in the Rupa Judgement, the Supreme Court has addressed the specific concern raised by Seervai. The Court has held that in the event the verdict of the highest Court of the land suffers from any form of infirmity or errors, the power of review under Article 137 has been expressly provided by the Constitution to precisely address such exigencies. In other words, Article 32 need not be invoked against judicial orders when the power of review under Article 137 is available. In Rupa, the Supreme Court drew attention to the fact that the width of its inherent powers to do justice have been adequately captured by the language of Order XLVII, Rule 6 of the Supreme Court Rules which have been framed in relation to exercise of the power of review under Article 137. Extracted below is the said Rule 6:

“6. Nothing in these rules shall be deemed to limit or otherwise affect the inherent powers of the Court to make such orders as may be necessary for the ends of justice or to prevent abuse of the process of the Court.”

Clearly, in view of the above, there is no need or basis to stretch the limits of the definition of State under Article 12 or the scope of remedies available under Article 32 to challenge judicial orders which warrant revisitation. What is noteworthy is that Seervai has not commented on the adequacy or otherwise of the remedy of review under Article 137 in his discussion on whether Article 32 is available against the Judiciary.

What follows from this discussion is that, State action which violates Part III is open to judicial review under Articles 32 and 226, whereas judicial verdicts are subject to appeals, revisions, references, special leave petitions and review petitions, all of which provide a basket of remedies to aggrieved litigants. Assuming that even the outcome in the ultimate remedy before the Supreme Court results in abridgement of fundamental rights, the remedy lies in moving the wheels of the Executive and the Legislature, subject to a few qualifications and riders.

J. Sai Deepak is an Advocate practising as an arguing counsel before the Supreme Court of India and the High Court of Delhi.

Legally Speaking

Know about farm bills that have been turned into law

Published

on

Farm bills

The farmer is the only man in the economy who buys at retail, sells everything at wholesale, and pays the freight both ways. This line by John F. Kennedy reflects the pain which a farmer faces in conducting his trade. The farm bills which passed through Rajya Sabha on Tuesday amidst great opposition from various parties and high voltage drama in the Upper House seeks to bring revolutionary changes in the trading process of farm produces. Farmers have showed up in huge numbers on the roads of Punjab, Haryana, Uttar Pradesh and many other states across the nation to show their dissatisfaction against these bills. Adding flare to the agitation Union Minister for Food Processing Industries, Harsimrat Kaur Badal resigned from the Central Government in solidarity with the farmers. The big question which arises is whether the leaders of such farmer groups which are up in arms against the bills really want to bring about change in the lives of the farmer or are just masquerading as the farmers to get political mileage. The bills which are due to presidential assent are The Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Bill, 2020, the Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Bill and The Essential Commodities (Amendment) Bill, 2020. These bills aim to channelize the trade of farm produces directly between the farmer and the buyer leading to economic welfare of the farmers. It is a very historic moment in the Indian agricultural scenario which seems to bring a revolutionary change just like the 1991 liberalisation and globalisation phase.

 Farmers’ Autonomy

 Terming the present three bills which are due for assent by the president of India, as “anti-farmer” bills is a rhetoric completely made in ignorance. These bills are rather providing flesh and blood to a farmer’s right to trade, commerce and intercourse as enshrined under Article 19 of the Constitution and Article 301 of the Constitution. The existing framework was set up by different state governments for the regulation of trade and commerce of agricultural produce, which is done through Agricultural Produce Marketing Committees (APMCs). This framework is hit by many deficiencies such as cartelization by APMC agents which lead to a non-transparent price fixation mechanism and paying variety of tax and cess which leads to up the total value of their farming cost. Additionally the existing framework creates a highly anti-competitive market system where there is rampant red tapism through licencing of traders, making it very difficult for a new trader to join in. 

The new farm bills seeks to create an alternate trading atmosphere which will be more conducive for the farmers and based on the principle of laissez faire attracting minimal governmental intervention. It aims to remove all the barriers and restrictions imposed on the trading autonomy of a farmer. The new farm bills are going to amplify the magnitude of the fundamental right to trade of the farming community in its fullest sense.

 Art. 19 of our Constitution ensure the freedom to practise any profession, or to carry on any occupation, trade or business. Moreover, Art. 301 ensures freedom of trade, commerce and intercourse throughout the territory of India. A conjunctive reading of Article 19 and Article 301 paints a greater constitutional mandate regarding an individual’s freedom to trade by supplementing it with freedom to trade inter-state or intrastate both. The definition of ‘trade area’ as per Clause 2(m) of the Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Bill, 2020 specifically excludes “market yards, sub-market yards and market sub-yards managed and run by the market committees formed under each state APMC (Agricultural Produce Market Committee) Act” and “private market yards, private market sub-yards,direct marketing collection centres, and private farmer-consumer market yards managed by persons holding licenses or any warehouses, silos, cold storages or other structures notified as markets or deemed markets under each State APMC Act in force in India”. In the existing framework due to reasonable restrictions, a farmer could only trade in the mandis regulated by the APMCs. But with coming of these bills into force, the farmers will have a choice to trade inside their outside that area with their free will and without any unnecessary obligations. It also allows farmers to freely trade through electronic medium. It aims to reduce the total farming cost which a farmer incurred in the existing framework by abolishing any kind of market fees charged by the state government subject to trade takes place outside the APMC market. 

Now a farmer will have negotiating power as regards to price of his produce. He can bargain the amount to his benefit and not just settle at the amount manipulated by existing trader cartels. He can participate in an agricultural market which is open to competition and not just controlled by a few big players. The Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Bill, 2020 seeks to provide the farming community with a significant role to play in the agricultural market and not just be a raw material provider surrendered at the hands of agents and traders. It seeks to bind farmer and buyer in an agreement which takes place prior to production and price fixation is done with the consent of both the parties. This is known as ‘Contract Farming’. Such type of farming provides a farmer with benefits like there is drastic reduction of price related risk because they have already the price to their benefit. Any volatile market situation will not affect their pre-defined right to a certain amount of money. Many farmer groups are apprehensive that they will not get the appropriate amount for their produce. Their fear is also valid as it seems to them that they will not even receive the Minimum Support Price as big corporations may use their influence to get the agreement signed at a lower price. But all these fears should not exist as these bills are not here to replace the already existing framework of APMCs but to give an alternative which respects a farmer’s individual autonomy. If a farmer experiences that he is not able to get a price worth of his produce then he has the option to conduct his trade at the mandis setup by the APMCs. The sole aim of these bills is to recognize the individual autonomy of a farmer in conducting trade of his hardly grown produce. Another big advantage of this contract farming is going to be linkage of agreement with credit or insurance schemes of central or state governments. Now the farmers will not be dependent on local moneylenders for quick loans which led such farmers into a debt trap and with this linkage there will be a huge risk mitigation in the favour of farmers. 

Dispute Resolution

 After introduction of these bills into the parliament there was a huge hue and cry across the nation against introduction of ‘contract farming’. It is being perceived that due to unequal bargaining powers between a corporation and a small farmer, the agreement may heavily favour the interest of corporations and be detrimental for poor and illiterate farmers. But these doubts are really uncalled for because the bill already provides enough safeguard through its provisions from Sections 3 to 12. The biggest problem is when there are parties with unequal bargaining powers, the party with the high bargaining power like corporations draft boilerplate contracts and insert dispute resolution clauses which bends in their favour and party with a lower bargaining power is kept away from justice. The Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Bill, 2020, introduces a dispute resolution provision to cure this mostly used method to deny access to justice to party with a lower bargaining power. It is a big step in the direction of providing access to justice to the farming community by introducing conciliation as a method of dispute resolution. It saves a farmer a whole lot of money and time by keeping him away from litigation. Now a farmer could resolve his agricultural dispute in a speedy manner without knocking the heavy doors of courts. 

The power-sharing gauntlet 

Post-tabling the concerned farm bills, the Upper house witnessed opposition admonishing the bills on the account that it was a brazen attack on the federal structure of our constitution. It is hereby rebutted that the concerned bills do not in any case breach the constitutional limits. Moreover, they bolster the idea of cooperative federalism.

 The legislative power sharing between the centre and the state has been enunciated in seventh schedule of our constitution. The seventh schedule of the Indian constitution has three lists. List I refers to the subjects under the Centre or the Union, List II refers to the state list and List III refers to the concurrent list where the states and the Centre are co-sharers of power and responsibility.

 Entry 33 of the Concurrent List says that Centre and the States have powers to control production, supply and distribution of products of any industry, including agriculture. Further, Entry 34 of the concurrent list deals with price control. Conjunctive reading of Entry 33 and Entry 34 connotes that the centre has power to make laws on trade and commerce in production, supply and distribution of products of agricultural industry and further on fixation of the prices. Constitutional propriety of Centre to make laws on agricultural products flows from the above mentioned entries of Concurrent List. Thus, the centre in no way is encroaching upon the laws making powers of the state. 

Moreover, the concerned farm bills do not crumble upon the idea of cooperative federalism envisaged by our constitution. The above proposition can be well elucidated by the following stance: 

1. Agricultural Produce Market Committee i.e. APMCs are established by a state government though their respective state legislations. APMCs are physical market places where farmers are required to bring their produce to the market if they have to sell it there. Gradually, these APMC’s have become de facto monopolies because of the fact that almost all farmers used these markets to sell their produce which resulted in no serious competitions. 

2. Farmers Produce Trade & Commerce (Promotion & Facilitation) Bill, 2020 seeks to ameliorate the mischief created by the state APMCs. The concerned bill allows intra-state and inter-state trade of farmers produce outside: (i) the physical premises of market yards run by market committees formed under the state APMC Acts and (ii) other markets notified under the state APMC Acts. 

What can be construed is that Farmers Produce Trade & Commerce (Promotion & Facilitation) Bill, 2020 will eliminate the restriction that used to be imposed by the state APMC’s. It seeks to demolish the dens of monopolistic power which throttle the Indian farmer. The concerned bill creates a legal framework to set up markets that will run parallel to what the states have established through APMCs. Thus, it in no way, restricts the operation of the state APMC’s. What is does is that, it expands the horizons of options for the Indian farmers to sell their produce. 

Cooperative federalism, also known as marble-cake federalism, is a concept of federalism in which federal, state, and local governments interact cooperatively and collectively to solve common problems, rather than making policies separately but more or less equally. This step significantly bolsters the notion of cooperative federalism in a way that, now, the farmers will have two recourses, i.e. either to sell their produce through the state established APMC’s or do it individually by virtue of Centre’s Farmers Produce Trade & Commerce (Promotion & Facilitation) Bill, 2020. Thus, the concerned bill seeks to establish the harmony between the centre and state.

 Concluding Remarks

 The bills which are being protested are not ‘antifarmer’ but those who are protesting these bills are certainly ‘anti-farmer’, they are trying to impede the positive change which is going to boost the economic condition of farmers. The farm bills aim to enhance the scope and freedom of farmers to trade. The Government has introduced these bills to further enlarge the individual autonomy of farmers to trade as guaranteed under Article 19(1)(g). India is witnessing the epitome of co-operative federalism wherein without any kind of encroachment on the State’s framework; the Centre has carved an alternative method for the welfare of farmers. Both the frameworks are mutually exclusive of each other. The Farm Bills are breaking the chains of cartelization and licencing away from the farmers which stood in the path of their glory. The economic boost which the farmers will now experience will never let a food provider die of hunger.

Continue Reading

Legally Speaking

Fifty one shades of speech

J. Sai Deepak

Published

on

In the previous piece, this author had raised the following questions in the process of etching the contours of public morality: “The sum and substance of these discussions is that under the framework of the Indian Constitution, it is the State, meaning thereby the Executive and the Legislature but not the Judiciary, which has the power to invoke public morality within reasonable bounds for the purposes of placing reasonable restrictions on fundamental rights guaranteed by Part III of the Constitution. The Judiciary’s role is limited to examining the constitutional validity of the claim made by the State that the latter’s action is in the interest of or furthers public morality. 

That said, what are the parameters that must be applied to such an examination? In other words, how does the State demonstrate that its action represents public morality? What kind of exercise must the State undertake, if at all required by the Constitution, to assess public morality in relation to a given right? Or does the Constitution grant elected representatives the unfettered right as parens patriae i.e. parent of the nation, to speak on behalf of their constituents on every issue merely because they have been elected? Can members of the State form an opinion on public morality in relation to a given issue or topic without consulting members of the society to marshal some form of concrete evidence to base their positions on? Critically, in the context of a diverse society such as Bharat, how can the State hope to do justice to varying and often conflicting positions on public morality?

… Does this mean that the scope of use of public morality by the State as the basis for limiting individual freedoms is limited to public spaces? What is the position of the Indian civilization and the Constitution on the spaces and contexts in which public morality may be used as a legitimate restriction on individual rights? What constitutes public morality within the framework of the Indic civilizational worldview and what are its sources?” 

While the author’s original intent was to address these specific questions in the present piece, a legitimate and related digression is warranted in the current atmosphere to give the discussion a much more relevant and concrete peg. Over the last few days, “hate speech” has become the talk of the town because some have taken offense to the contents of a certain programme which, they believe, target a particular community. While the Ministry of Information and Broadcasting, and the Hon’ble Supreme Court, are simultaneously, and perhaps incongruously, seized of the case, it may be worthwhile to understand the relationship between speech, culture and public morality. In the interest of fair disclosure, this author is appearing on behalf of a few Intervenors in the proceedings before the Supreme Court. Therefore, in the interest of propriety, he shall desist from commenting on the specific merits of the case. The focus of the instant piece is the meta nexus between speech and civilizational ethos.

 Language, while acting as the vehicle for expression of thought, results in speech. Therefore, speech could be treated as but one form of expression, and for the purposes of the discussion at hand, may be treated as a broad representative of varied forms of expression. To reduce speech to merely a collection of words is to betray one’s ignorance and superficial understanding of human psychology, both individual and collective. Speech, in fact, contains the markers of a civilisation’s journey, depth and the values it believes in. One could go even a step further to make the point that speech is perhaps the most literal, visible, audible and ubiquitous expression of public morality. The lessons, beliefs, achievements, tragedies, the objects of worship and hatred of a people take the shape of similes, idioms, usages, proverbs and even cuss words. Therefore, to police speech, is to police not just the ability to express thought, but thought itself because policing the formers chills and stifles the latter, thereby killing the idea at source. 

Given the implications of policing speech, society is naturally expected to be extremely cautious and selective in handing the right to police its speech and thought to any particular organ as part of its social contract with the State. To hedge against unilateralism and authoritarianism, the republican premise is that it is safer, if not the safest, to put faith in organs which are vulnerable to and are the product of the will of the people, namely the Legislature and the Executive. Even if this choice has the inherent risk of surrendering one’s individual right at the altar of a process which ruthlessly rewards the numerical majority, it still puts faith in the deeper churn of a society and its tendency to see the light through trial and error. Perhaps this is because of the unspoken belief in the existence of a “society” which shares a common minimum pool of values and aspirations, notwithstanding differing political perspectives and ideological persuasions. More often than not, this common minimum pool of shared values and aspirations traces its origins to the fundamental ethos of a people or a civilization i.e. the shared ethos which justify the reason for the existence as a single national/ civilizational, and hence political unit. This demonstrates that politics cannot faithfully and fully reflect the bonds that connect the members of a society. It also explains why as part of a social contract an individual is assumed and expected to submit to the dispensation which the majority has elected even if the individual is at loggerheads with the dispensation’s positions.

 In view of the above rationale, an organ, such as the Judiciary, whose rectitude is its hallmark and is presumed to translate to impartiality and objectivity, cannot, must not and is not designed to attempt to step into the shoes of elected organs. This is not only because it violates the rules of “the” social contract, namely the Constitution, but also because it deprives the people of their say in the process of laying down the law, which partakes significantly, if not solely, from public morality. Critically, since notions of public morality vary from society to society and even within society, only the State, namely the Legislature and the Executive but not the Judiciary, is competent to and mandated to prescribe the red lines of free speech.

 In a brilliant paper titled “Morality as a Legitimate Government Interest” published in Penn State Law Review in 2012, Daniel F. Piar, then a Professor of Law at Yale Law School, examined in detail the United States Supreme Court’s tendency to homogenize moral standards in the name of the Constitution (a.k.a constitutional morality), and concluded as follows:

 “As discussed above, moral diversity yields numerous moral benefits to individuals and to the society that they constitute. To resist the proliferation of moral diversity is to deny that we are a pluralistic society. If we are to remain true to our liberal commitments, we must acknowledge—and accept— that the world is full of matters on which people of reason and good will are apt to disagree. A productive moral diversity then may flourish, to the betterment of each of us and our society. 

The law, however, has trod a more dangerous road, threatening to suppress diverse responses to moral issues through a homogenizing constitutionalism. If society is to retain the social and personal benefits of moral diversity, society will need to be attentive to the points at which the law impedes it, as well as to the opportunities in law for sustaining it.” Why should the logic be any different in the Indian context?

 J. Sai Deepak is an Advocate practising as an arguing counsel before the Supreme Court of India and the High Court of Delhi. 

Continue Reading

Legally Speaking

The case of SC gag order against Sudarshan News

One of the arguments advanced by the intervenors is that ‘hate speech’ is punishable under Sections 153A
and 153B of the Indian Penal Code, Section 3(i)(x) of the SC/ST Act and Section 5 of the Cinematograph Act.
Without getting into the details of the said provisions and examining whether the content falls under their purview or not, what is to be seen here is that these provisions are punitive in nature, not preventive.

Siddharth Nayak, Vijay K Tyagi & Krishnagopal Abhay

Published

on

There has always been a huge debate on this among various writers. Locke provides an interpretation to this as well. He sternly believes that ideas do require labour. Well we can’t expect that an idea to invent a bulb was without an extreme labour being done by Thomas Edison.

The evolving nature and spectrums of the mode of data distribution by the fourth pillar of Indian Democracy has given rise to dynamic challenges for the existing legal framework to control and regulate. Media being the fourth pillar is indeed playing a pivotal role in the society by trying to educate masses. The freedom of press ensures that citizens are vigilant, well informed, and therefore, can discharge their role in a democracy by fixing accountability.

Freedom of Press and Right to Know

The public’s “right to know” has become an increasingly popular political ideal in India. The essence of this right, for both the public and the press, has gained significance and acquired a new meaning in the contemporary era. Although the Constitution does not expressly guarantee the public the “right to know”, an increasing number of constitutional scholars argue that it is an implicit right guaranteed under Article 19 of the Constitution and by the general principles of constitutional democracy. Freedom of press constitutes not only the individual right of the owner of the news publications, the editor, or the journalist; it also includes the right of the citizens to be informed. It can be forcefully argued that the tenets of Article 19 offers within its ambit, the ‘right to know’ without any constitutional, statutory or executive frame- work to restrict or regulate the same before the cause of action arises. Comparatively speaking, the judicial discourse had long evolved since the days of classical Greek and Rome or the 16th century France which staunchly believed in prior restraints along with post- facto substantive measures.

Thus, freedom of press flows from the citizens’ right to know, which is conceived to be paramount. The Hon’ble Supreme Court of India, through several of its decisions on fundamental rights, has developed this jurisprudence. The courts have always been of the opinion and champion of the concept that censorship, since it necessarily restricts freedom, has always been and will continue to be unpopular with those who, from principle, perversity or for profit, insist on unbridled freedom.

Here, as the journalist is claiming that his show is based on his investigation and analysis of data avail- able in the public domain on the selection of students in UPSC Civil Services Examination, it is not only the journalistic freedom which is restricted by the gag order, but it’s also affecting the people’s right to know about the pattern of selection of students in UPSC-CSE.

Writ Jurisdiction when Alternative Remedy is Available

The petitioners approached the Court by way of Article 32 of the Constitution of India, which allows the citizens to approach the Apex Court for enforcement of Fundamental Rights directly. It is settled law that this jurisdiction can only be invoked in the absence of a redressal mechanism or alternative remedy, unless there are compelling circumstances warranting interference of the constitutional court for vindication of fundamental rights. The doctrine of exhaustion of remedies also cements this. The powers conferred and vested with the Apex Court under Article 32 is too infallible to adjudicate upon such issues as well (emphasis on the word ‘adjudicate’).

Rule 6 of the Cable and Television Networks (Regulation) Rules has adequate provisions which disallow the running of any programme, which is an attack on any religion, defamatory or communal. As noted by the Hon’ble Supreme Court in its order, if a show is found to be violative of the said rule, sanctions under Sections 19 and 20 of the Cable and Television Networks (Regulation) Act, 1955 are imposed. A bare reading of Sections 19 and 20 makes it amply clear that such sanctions/prohibitions will come from “any authorized officer” or the “Central Government” respectively. The Court, after mentioning the previous sections, took it upon themselves to exercise a power which must be kept outside of their reach.

One of the arguments advanced by the intervenors is that “hate speech” is punishable under Sections 153A and 153B of the Indian Penal Code, Section 3(i)(x) of the SC/ST Act and Section 5 of the Cinematograph Act.

Without getting into the details of the said provisions and examining whether the content falls under their purview or not, what is to be seen here is that these provisions are punitive in nature, not preventive. Under no stretch of imagination can these be used by the Apex Court to issue a blanket order restricting the Freedom of Speech and Expression, which is guaranteed by Article 19(1)(a) of the Constitution. These provisions come into picture after the content is delivered/published, and if the person is found guilty, they shall be punished as per law. For the sake of argument, even if the Court interprets the said provisions to be preventive as well, it is well settled that Fundamental Rights will overpower statutory provisions if they are at loggerheads.

That right is not absolute; it comes with restrictions laid in Article 19(2). It is well settled that before restricting anyone’s freedom under Article 19(1)(a), the “speech/ expression” has to be examined; and if it passes the tests laid in Article 19(2) – post-examination – it may be restricted. One of the issues with this blanket gag order is that it was passed based on a “prima facie” view, formed after looking at some snippets of the show provided by the petitioners, even when the Counsel for Sudarshan TV requested the Court to watch and con- sider the series in toto. Quite interestingly, the Court did not enter the domain of Article 19(1)(a) vs. Article 19(2), but even if they had, it is not within the reach of the Court to pass gag orders invoking the restrictions laid in Article 19(2).

Notably, the constitutional text of Article 19(2) states that the State might make laws to restrict the right guaranteed under Article 19(1)(a). Firstly, it is the ‘State’ which can limit the right and secondly, it has to be done by bringing a ‘law’. In a long catena of judgments, the Hon’ble Apex Court has time and again held that judicial functions of the Judiciary are not under the ambit of “State” as per Article 12 of the Constitution. In the landmark judgment of K.A. Abbas vs The Union of India, the Hon’ble Apex Court held that pre-censorship is allowed as per Article 19(2), but the same has to be done by statutory bodies which are formed by the “State” as per law. It was also laid that statutory bodies will have to lay guidelines and clearly express what would not be permissible. The Court, while getting into the debate of free speech and hate speech, fails to observe that no such guidelines have been formulated as of now. The apex court could have directed the appropriate statutory body/executive body to con-sider the prior restraint position and take appropriate action instead of venturing into the content editorial domains. No matter how one justifies it, Sr. Counsel Shyam Divan’s submissions that a constitutional court should not enter into the fields of content regulation are legally sound.

In this case, the Ministry of Information & Broadcasting, News Broadcasters Association and the Press Council of India were asked to reply, but the order was passed before they could submit their response. Simply put, no stakeholders – including the judges – could examine whether the impugned show could be termed as “hate speech” before the voice was muffled.

On a petition seeking similar reliefs in Delhi High Court, the Ministry of I&B, in its order dated 9th September 2020 refused to ban the show and stated that if the show violates the Programme Code under the Cable Television Networks (Regulation) Act, suitable action will be taken.

Jurisprudence on Prior Restraint: Bypassing the Statutory Mechanism

Delving into the jurisprudence of Prior Restraint, we shall start with the gold- en words of Mr. William Blackstone which strike at the heart of the current issue:“The liberty of the press is
indeed essential to the nature of a free state”. He emphasized on laying no previous restraints on publication, rather punish the publisher after publication, as per the established law. In Patter- son vs Colorado [205 U.S. 454, 462], Holmes J. of The Supreme Court of The United States, while referring to the cherished First Amendment of the American Constitution stated that it was passed to prevent previous restraints upon publications. Article 5 of the Basic Law for the Federal Republic of Germany and Article 21 of The Constitution of Japan guarantees Freedom of Speech and Expression and prohibit censorship of any kind, categorically that of the Press. In India, there are a plethora of cases which have held that prior restraint orders shall not be passed. While hearing a PIL filed by the NGO Common Cause in 2017 praying for regulating the content of the media, the Hon’ble SC had opined that pre-broadcast or pre-publication censorship is not the business of the Court and that all grievances against objectionable content will be dealt with in accordance with the law of the land after its publication.

The Counsel for the retired civil servants who intervened in the matter had argued that “hate speech undermines free market place of ideas”. Quite interestingly, in a blog, while defending free speech and criticizing blanket gag orders by the Apex Court, he had written: “Prior restraint is considered especially damaging to free speech because it chokes off the “marketplace of ideas” at its very source, and prevents certain individuals, or ideas, from entering the public sphere.” Subsequent to this, he also wrote: “we have been witnessing a disturbing trend where, in place of the legislature and the executive, it is the judiciary that has been taking upon itself the task of regulating, restricting, and censoring speech”. In another blog titled “Judicial Censorship: A Dangerous, Emerging Trend”, the Counsel had vehemently opposed the “trend” where Judiciary is passing gag orders which as per him is outside of the powers given to them by the Constitution of India. We, lawyers, have often been blamed for being biased towards our cause before the bench even though academically and legally we hold contradictory positions. But contradicting oneself with recorded writings is an insult to one’s own intelligence both as an academician and a lawyer.

It was argued that concession could be made in case of “hate speech”, which is distinguishable from “offensive speech”. For the sake of argument, even if we consider that the impugned show comes under the purview of hate speech, then also it has to be dealt with in accordance with the law. In Pravasi Bhalai Sangathan vs U.O.I. & Ors., the Hon’ble SC had laid: “As referred to here in above, the statutory provisions and particularly the penal law provide sufficient remedy to curb the menace of “hate speeches”. Thus, person aggrieved must resort to the remedy provided under a particular statute.” The precedents pertaining to categorization and classification of “hate speech” needs to be settled as well. Hate speech is an offence but dictating ‘prior restraint’ rationale akin to qui timet in the particular instance sets a dangerous precedent.

Observations of the Bench During Proceedings (Related to Constitution of a Committee of 5 Distinguished Individuals)

On Tuesday, in addition to free speech, self-regulation and legal restraint, the Court ventured into issues of ownership models of TV channels, revenue generation and the number of advertisements that the government gives to them. The discussion soon moved to the possibility of constitution of a committee of “distinguished individuals” to frame guidelines for the electronic media. Both the observations are deeply problematic because it’s not the domain of Judiciary to keep a check on the revenue model of media houses. The observation of the commis-be a case of judicial overreach.

Appointing committees and framing of regulations is a legislative and executive function. If someone believes in the idea of democracy, the concept of distinguished/eminent personalities can’t be said to conform with the high standards of constitutional democracy.

Hon’ble Justice Chandrachud observed that a pre-publication restraint is one of the rarest rationales to be exercised under extreme recourse and can take the Court down a slippery slope. The Court expressed its anguish but yet the gag order was not vacated and instead it went ahead with segments of content editorial suggestions. If one were to infer a ‘collateral bar rule’– which prevents any challenges to a court order if the party disobeys the order before first challenging it in court – arising out of such steps in the Indian context, it sets a duty of absolute obedience notwithstanding any constitutional rights un- less the concerned order has been set aside by a higher authority.

To conclude, the Court’s order of prior legal restraint is problematic in light of the availability of an alternative remedy under various Acts and the settled jurisprudence pertaining to the issue. It interferes with the people’s right to know. Moreover, it’s not the domain of Judiciary to keep a check on the revenue model of media houses; and the observation pertaining to the constitution of a commission, in our humble opinion, will be a case of judicial overreach.

Siddharth Nayak is Managing Partner, Atharva Legal. Vijay Tyagi is LL.M, Constitutional Law, Indian Law Institute and ex-LAMP Fellow. Krishnagopal Abhay is a 2nd-year student of LL.B at Campus Law Centre, University of Delhi.

Continue Reading

Legally Speaking

Competition law and state aid for aviation sector

Does the sector need specific regulator or general regulator? A bird’s eye view.

Published

on

With respect to having DGCA and Competition Commission of India as the adjudicating body, the question arises: Do we have a specific sector regulator for aviation or the general rules are applied by the competition commission? Observing the transit of the aviation sector through the Express Industry Case it is clearly observed that the investigation into cartel-like behaviour created in the oligopolistic market is a tricky one. 

‘Competition law treats agreements among rival firms to set the terms on which they trade as extremely serious offenses. Most of the world’s approximately 120 systems of competition law assign the prosecution of cartels a high priority.  

 In the wake of LPG policy triggered in India in 1991, a perception gathered momentum that the existing law for Market Regulation i.e. the Monopolistic and Restrictive Trade Practices 1969(MRTP Act) was not sufficiently arrayed to handle the competition in the Indian Market. With removal of trade barriers in 1991 the Indian Market became the hot gate for trade amongst the domestic players as well global giants which demanded a level playing field and a trade friendly environment. Need arose for a legal backing which would stimulate and shift the traditional practices of curbing monopoly to encourage companies to invest and grow, in-turn enhancing competition without abuse of dominant position.

 Competition and liberalization together unleash the entrepreneurial forces and the same was experienced back in the late 19’s. Basically competition is a situation in the market where the seller strives for a buyer for business objectives. These competition needs to be regulated as somehow some businesses may opt for anticompetitive practices for short term perks which actually nullifies and makes the competition void. The countries across the globe over the time focussed on regulating the market forces by providing absolute legal backing to relinquish the anti- competitiveness in the market and also reinforcing economies through setting up of regulatory bodies. Following the international trends Competition Act, 2002 was enacted in India to regulate the competition and reduce the formation of cartels thereby encouraging better business practices and better consumer base.

 Acc. to section to section 3 of the Act, no enterprise or association of enterprise or person can enter into any agreement which causes or likely to cause “appreciable adverse effect” on competition, otherwise the agreement would be void. It may include: 

1. Directly or indirectly determining purchase or sale price, 

2. Limiting or controlling production, supply, technical development, investment or provision of service, 

3. Directly or indirectly results in bid rigging or collusive bidding shall be presumed to have an appreciable adverse effect on the competition. Provided that any agreement entered into through joint venture increasing efficiency in production, supply, distribution, storage etc. would not be void.

 Acc. to section 4 of the Act, the enterprise would be apprehended to have abuse the position in cases: 

1. He directly or indirectly imposes unfair condition in purchase or sale of goods, 

2. Regulates purchase price, 

3. Limits or restricts production of goods or provision of service,

 4. Regulating technical or scientific development, 5.

 Indulging in practices resulting in denial of market access etc. Being an omnibus code and regulating the market competition poses a great question towards the applicability of the Competition Act, 2002 to the Civil Aviation sector. The civil aviation sector has been considered to play in an oligopolistic market which entails a small group of players ruling the sector and somewhat indulging in the anti-competitive practices being in a dominant position.

 Applicability of Competitive Rules 

Increased deregulation and open market access to the players outside the territory of the country has led to adoption of advanced technology which has ultimately led to transformation in all sectors including the aviation sector. The sector has undergone radical changes in aeronautical science which has led to increased competition ultimately benefiting the consumers with competitive prices, more choices and being more choosy in opting for services. Despite this the airline industry operates in an oligopolistic market having more barriers for the entry thereby having reasonably less players which suspects apprehension of anti -competitive practices. Tacit domination of some players is highly apprehended. 

In the recent past there has been no new policy or rules enacted regulating the aviation sector but to the extent back in 1994 and then in 2016 the govt. opted for open skies policy under National Civil Aviation Policy (2016) which enables liberalization and ease of rules in the aviation sector for the foreign airlines in order to increase the tourist flow and develop the potential of being an air hub. The 2016 agreement allows the govt. to enter into reciprocal arrangement with (SAARC). Since then the country observed the Air India and Indian Airline Merger and many other agreements were ratified. Rule 135(4) of the Aircraft Rules, 1937 empowered the DGCA (Directorate General of Civil Aviation) to issue order incase the companies engages is an anti-competitive practice or predatory pricing so on and so forth, despite the law coming into force and previous rule in place the civil aviation sector has been completely bolstered by the act and to the extent the sector has not experienced any control by the (Competition Commission of India) or the (DGCA) in foreign merger such as Delta and North West, KLM and Air Force despite laws in place.

 Judicial Stand 

The Competition Commission of India in 2013 approved 24% equity infusion by the UAE based airline in the Jet Airways with the prior approval of SEBI, FIPB (Foreign Investment Promotion Board), CCEA (Cabinet Committee of Economic Affairs). The Commission for the first time without going into the investigation approved the same by analysing that such combination does not have Appreciable Adverse effect on the Competition as per Sec 5 of the Act as there are several other competitors in the relevant market. The combination had almost 38 routes to serve and where they had approximately 1 competitor on the route. Despite this, the combination would make the network more strong & high market shares of both the companies in their respective hubs is an advantage. The minority ruling gave 2-3 points against the combination such as: 

1. The Frequent Flyer Participation Policy would try to retain the consumer which creates barriers on new entrants thereby eliminating competition as the new entrant would be unable to create a customer base. 

2. The minority also mentioned that both the airlines are the only remaining competitors on New Delhi- Abu Dhabi route which would itself be eliminated pursuant to combination. 

3. One of several it mentioned that the airlines is not a substitutable product as precluded by the majority of judges. The airlines and also the consumer itself does not consider the services as substitutable and the connotation is based on wrong principle. 

4. The minority panel also mentioned that making Abu Dhabi as an exclusive hub for scheduled services to and from South Africa, North America would disable the Jet to share the code for certain origin and destination which would lead to market foreclosure and abuse of dominant position.

 In Turbo Aviation Pvt Ltd vs. Bangalore International Airport Pvt. Ltd (2016), the application filed by Turbo Aviation Pvt. Ltd in lieu of violation of section 3&4 of the Competition Act, 2002 by the Bangalore International Airport Ltd.(BIAL) & GVK. Power and Infrastructure Ltd. The commission while going into the merits of the case opined that there was no prima facie case against both the companies and put forth its opinion against the allegation in a precluded manner as in: 

The commission stated that there was abuse of dominant position by the BIAL & GVK Power and Infrastructure Ltd. but per se there was no violation of Section 4 of the Act as the act prescribes only the abuse of dominant position by the dominant player in the relevant market.

 It also pointed that there was no market denial to the Turbo Aviation Pvt Ltd.(informant) as the same needs to be previewed through the lens of GHS(Ground Handling Services) Regulation and the DGCA circulars and the laws governing it, no prima facie conclusion can be made out through the arguments put forth by the information. Further adding the commission pointed out that there was no violation of section 4(2)(e) of the act as the company itself was allowed to provide the GHS services at the Kempegowda International Airport Pvt. Ltd. through the DGCA GHS circular & GHS regulation. Although both the companies are in a dominant position but it is not clear as to how both are leveraging its position in the GHS market.

 In Express Industry Council of India vs. Jet Airways Ltd and Ors. (2015) the Competition Commission of India penalized three airlines namely Jet Airways, Spice Jet, Indigo in allegation posed against them. The Council of India alleges that the companies entered into Anti –Competitive Practice by increasing the FSC(Fuel Surcharge) despite decrease in the ATF(Air Traffic Fuel) which is in contravention of Section 3 of the Act. The commission allowed for investigation into the matter towards which no collusive evidence was found against the airlines in the report submitted by the DG. Despite this, the Commission passed an order against the airlines penalizing all three stating that the act of the airlines was against the market performa. An appeal was filed In COMPAT(Competition Appellate Tribunal) which was allowed and the penalties were set aside on basis of lack of application of principle of PNJ and thereby the case was sent back to the commission for reconsideration. Adherence to the principle of fairness was followed and response from the airlines were taken into consideration and the commission on 7 March 2018 ordered that there is a clear pattern which shows coordinated and well – connected efforts by the airlines in determining the FSC charge and this clearly postulates the price parallelism and formation of cartel entering into a anti – competitive practices thereby violating the provision of Competition Act. 

With respect to having DGCA and Competition Commission of India as the adjudicating body the question arises do we have specific sector regulator for aviation or the general rules are applied by the competition commission? Observing the transit of the aviation sector through the Express Industry Case it is clearly observed that the investigation and the propagation in cartel like behaviour created in the oligopolistic market is a tricky one. The concurrent challenges faced in regulating the same is difficult to strangulate in a market where there is dominance of certain players. To the extent there is no specific regulator both the agencies albeit try to comprehend economic efficiency. However on the other hand the DGCA has evolved as an sector regulator but not the market regulator which is concentrated in the hands of competition commission. There are no sector specific competition laws, the general rules of the act apply and this also imbibes that there is no state aid to the aviation sector except given to Pawan Hans Ltd. a government owned carrier. 

The CCI abruptly and concretely would modify agreements or make the agreement null and void if the same enables an appreciable adverse effect on the competition or any of business practice which tends to abuse their position and is derogatory to section 4&5 of the Act would be under strict scrutiny. Combinations are strictly dealt under section 5 of the act. Moreover the distinction between the specific sector regulator was also taken into consideration in Air India vs. Competition Commission of India and Interglobe Aviation Ltd. (2016) the COMPAT while upholding the decision by CCI held that predatory recruitment of pilots by Indigo does not intervene into any alteration in the structure of market. The DGCI have investigated into the matter which clearly showed that there is no competition concern in the market. The appellate tribunal also stated that the complainant should establish that the violator has indulged in predatory hiring of pilots from other airlines which thereby is causing adverse effect on flying operation and is in contravention to section 4 of the act albeit abusing the position in the market which is not the case in this pertinent scenario.

 The Way Forward

 It is a well settled principle that no enterprise or association of enterprise has the audacity to enter into an agreement which so makes them in a position to which they can use that position to dominate the competition in the market. It is recognized that identification of anti -competitive agreements entails exposure of cartel like behaviour. High interdependence of the players in the oligopolistic market tends them to move in a direction which excludes the new entrance of players and thereby deciding the output which make it very difficult to determine the existing cartel like behaviour. In light of this the Competition Commission of India strictly abrupts any activities which are in contravention of the act and is having appreciable adverse effect on the structure of the market. Few recommendations: 

1. Removal of Frequent Flyer Policy is not a solution to any effect as this only acts as a marketing strategy rather than a tool for abuse of dominant position. The DGCA should be empowered to investigate any kind of marketing strategy which tends to abrupt the market competition.

 2. The powers of DGCA and Competition Commission of India should go hand in hand and none of the agencies should supersede each other’s powers as the basic objective of both the agencies is economic efficiency and to the extent adequate laws are in place but implementation has always been an issue. Despite having adequate agencies in place, investigation and cheque balance system in cartel like behaviour has always been a part of debate.

 3. Being an oligopolistic market the basic objective of the agencies should be aligned prominently to cater the contravention of competition act to the extent prevention of anti -competitive agreement beyond that controlling each and every action of the sector would entail much interference. 

4. Major focus should aim at bringing about better services at affordable prices to the end consumer. Need for sector specific regulators or competition laws is not the need of the hour. State aid concept needs to step in smoothly to bring about a consumer centric approach and also due to the pandemic the aviation sector has been significantly impacted which calls for financial assistance from the state.

 The Competition Act is comprehensive enough and meticulously carved out in the light of current market structure which has dawned upon the Indian Economy. The current milieu of the act serves holistically the competition forces in India which is in synchronization of FDI policies, FEMA policies so on and so forth. The Competition Commission of India has risen up to the occasion and has acted as a general regulator for all the sectors so is the case with the aviation sector whereby seeking and encouraging better competition in the market. From our personal point of view, the need for a specific regulator for the aviation sector is not the need of the hour.

Continue Reading

Legally Speaking

State police versus CBI: A long time dissidence

Published

on

State Police and Central Bureau of Investigation (CBI) both distinctive entities that were regulated through the Police Act, 1861, and the Delhi Special Police Establishment Act, 1946 respectively. State Police falls within the subject of the state government due to which different states have their own way of regulation of state police. Some state follows and regulates as per the Police Act, 1861 that was enacted and enforced by the Central government whereas, some of the states bring their own laws for the regulation of State Police. 

In the year 1963 a resolution passed by the Home Ministry in order to amend and rename the already established ‘Delhi Special Police Establishment’ as Central Bureau of Investigation when the government feels the dire need of a proper and specific agency which is totally inclined towards the investigation process related to the corruption matters of the government agency. 

State Police vs CBI:

Separation on matter’s Jurisdiction This article specifically talks about State Police and CBI so without entangled in the difference between State Police and Central Armed Police Force and why there is a change in name of Delhi Special Police Establishment, we will deal with the matter’s jurisdiction of both separately.

State Police as mentioned above that it is a subject of State Government so it particularly inclined and involve in dealing with the local matters i.e. Maintenance of law and order, Investigation related to crimes and other pertinent issues in that particular state jurisdiction. State Police is not more involved in others matters like terrorist attack, large-scale riots and other serious offenses because Central Reserved Police Force specifically trained for these matters to deal with minimal devastation. 

As per 2015, report of National Crime Records Bureau over 73 lakh complaints have been filed for the cognizable offenses where there is no requirement of a warrant for investigation and also as per the data of Commonwealth Human Rights Initiative there is a gradual increase in the number of state police forces (1951-2011).

Whereas, Central Bureau of Investigation (CBI) from the beginning established with the purpose of tackling the cases of corruption in Public sector but after the globalization with the emergence of more and more private sector undertakings the jurisdiction of dealing with corruption based matter extends up to the private sector also. This jurisdiction extend more when a five-judge Constitution bench of Supreme Court held that the higher judiciary can direct CBI to indulge themselves in the investigation process on public order, safety, police which falls within the ambit of the state government without its consent. Currently, CBI deals in almost 8 different matter’s jurisdiction. 

The recent news of Sushant Singh Rajput case that CBI will handle the suspicious case of death of SSR and this is totally on the direction of Supreme Court to take up this serious case that is also raising question on the investigation done by the State Police and to solve this long going mystery. 

CBI Dispute:

A Controversial and Noteworthy Matter On 23rd October 2018, the Central Vigilance Commission (CVC) passed an order divesting Shri Alok Kumar Verma, Director of CBI of the powers, functions, duties and other supervisory role vested in him as the Director of the CBI and Central government stand by the decision of the CVC and make Shri Alok Kumar Verma deprived of the rights vested in him as the Director of CBI.

 In against this order of CVC and Central government, two petitions were filed in Supreme Court one by Alok Verma itself and another one by the NGO (Common cause) challenging the order of the Central government. The Supreme Court on 8th January 2019 in the case named Alok Verma v. UOI and Common cause v. UOI, quashed the orders issued by the Central government of divesting the CBI Director, Mr. Alok Verma, of his responsibilities and reinstate him as the Director of Central Bureau of Investigation (CBI).

State Police vs CBI:

Right to Denial of Right to Information Right to Information an enactment made by the Parliament of India which gives immense and valuable power to the citizens of India to receive information by following some procedure from the governmental bodies or setup. But like everything it has also some exceptions and one of them is in the case of CBI. 

Central Bureau of Investigation got some privilege of not disclosing their any kind of information whether it is related to corruption matter, public order or any other types to the public and also there is no application of RTI Act, 2005 on CBI. The question here arises why CBI is exempted from disclosing their information to the public?

 The reason behind this is simply that it is exempted to secure National interest and National security from any kind of threat due to disclosure of significant information in public at large. Whereas, if we talk about the denial of the Right to Information in the context of State Police there is no such exemption made to them and even no privileges available on their part. The Public has full right to get information regarding the investigation or any other related matter and no one can stop them from doing so. 

Conclusion :

After the resolution passed and the Delhi Special Police Establishment transform in the Central Bureau of Investigation, the CBI came into highlight and overcome as a separate body that has power to control all the corruption related cases in beginning and later in other issues with the wider jurisdiction. State Police since from the very beginning particularly attached with some fixed matter’s jurisdiction and controlled effectively to deal with the minimal state level matters in different way by each state government.

 Different pronouncement of judgment by the higher judiciary authorities makes it more effective and supreme agency in dealing with different subject matter and some of the exemption like, RTI helps CBI to emerge on a larger scale without any interruption and paves way to act as ‘interpol’. Many times CBI faces a lot of criticism or words against them but all these criticism paves way to the better handling of different arena of cases in upcoming times. 

Continue Reading

Legally Speaking

Covid warrants increased acceptance of digital and electronic signatures

Electronic transactions have become a part of everyone’s lives in this era, owing to the massive and large-scale utilisation of technology in business, trade and commerce.

Published

on

CONCEPT OF DIGITAL AND E-SIGNATURES Electronic transactions have become a part of mostly everyone’s lives in this era, owing to the massive and large scale utilization of technology in business, trade and commerce. This consequently entails ‘n’ number of electronic documents being transferred over various networks. In order to curtail the risk of tampering of information contained in the electronic documents, the concept of digital/e-signature was introduced. In essence, digital/e-signatures provide authenticity to electronic records. Notably, the Information Technology Act, 2000 (hereinafter referred to as the “2000 Act”), recognizes such signatures. 

SECTION 2 DEFINES THE TWO SIGNATURES AS

“[(ta) —electronic signature means authentication of any electronic record by a subscriber by means of the electronic technique specified in the Second Schedule and includes digital signature; (p) —digital signature means authentication of any electronic record by a subscriber by means of an electronic method or procedure in accordance with the provisions of section 3;” The distinguishing characteristic of a digital signature is that it makes use of cryptography – a process requiring encryption and decryption of an electronic record to be accessible.

It is not an unknown fact that cryptography not only ensures the integrity of an electronic record but also its confidentiality. This implies that, if for instance, “A”, digitally signs a bank document, his document will never be under the risk radar i.e. to say that nobody, will be ever be able to temper its contents, unless they get access to the decryption key, which is unique to the original receiver.

Interestingly, electronic signature does not restrict itself only to the aforementioned process, but allows in its dimension, “any process” which ensures that the signer, at the time of signing the document, had full control over it and that if in the scenario, the contents are tempered before it could reach the original receiver, then such change should be capable of being detected. Therefore, both the signatures intend to provide maximum security and authenticity to an electronic record, thereby proving that they are no less than the wet signatures.

Provisions of the 2000 Act are premised on the Model law of E-Commerce, provided by the United Nation Commerce on International Trade Law, which, basically enshrines the principle of minimalist neutral approach. This approach advocates that the law should remain neutral with the changing technology, as the legislators cannot constantly change laws in order to keep pace with the ever advancing technology. One of the most important Articles of the Model lays down, that where it is prescribed that there ought to be a signature of a person, any technology can be used. Clearly, it hints towards the validity of electronic signatures.

The 2000 Act has ratified similar provisions and the same have been reproduced below: “Section 4. Legal recognition of electronic records.— Where any law provides that information or any other matter shall be in writing or in the typewritten or printed form, then, notwithstanding anything contained in such law, such requirement shall be deemed to have been satisfied if such information or matter is– (a) rendered or made available in an electronic form; and (b) accessible so as to be usable for a subsequent reference.

Section 5. Legal recognition of 1 [electronic signatures].— Where any law provides that information or any other matter shall be authenticated by affixing the signature or any document shall be signed or bear the signature of any person, then, notwithstanding anything contained in such law, such requirement shall be deemed to have been satisfied, if such information or matter is authenticated by means of 1 [electronic signature] affixed in such manner as may be prescribed by the Central Government. Explanation.–For the purposes of this section, —signed, with its grammatical variations and cognate expressions, shall, with reference to a person, mean affixing of his hand written signature or any mark on any document and the expression —signature shall be construed accordingly.” It can be safely concluded that, in India, electronic / digital signature is valid and it can be affixed in place of a wet signature. 

TAKE OF BANKING SECTOR ON DIGITAL & E-SIGNATURES

Though, the Reserve Bank of India has not issued any specific guidelines on the acceptance of electronic/ digital signatures in all types of bank transactions universally, it has still, through various circulars acknowledged its validity. Undernoted are some of such circulars: Amendment to Master Direction (MD) on KYC, RBI/2019-20/138 Vide this circular, the RBI, with a view to leveraging digital channels for Customer Identification Process (CIP) by Regulated Entities (REs), permitted Video based Customer Identification Process (V-CIP) as a consent based alternate method of establishing the customer’s identity, for customer onboarding. In this process of Digital KYC, all the electronic documents containing electronic/digital signatures, are to be verified (compliance with 2000 Act) by the RE. A clear inference that can be drawn from this circular is that the RBI encourages the use of digital/electronic signatures. E-Tender, RBI/Chennai/ Issue/26/18-19/ET/260 The RBI issued a Tender for supply of sufficient number of fully covered closed vans/ vehicles for transportation of coins from RBI, Chennai to various currency chests and other places in the States of Tamil Nadu and Puducherry under the cover of Bank Guarantee.

It is important to note that for the submission of the bid, it was mandatory for the vendors to submit their digital signature certificates. Again, it can be inferred that RBI permits the use of digital/electronic signature. Report of the Working Group on FinTech and Digital Banking In this report, the following was highlighted: “3.2.3.7 Banks are also collaborating with IT service providers for e-Sign(digital signature) facility to help digitally signing the loan documents.

This will help in faster approval process, lesser paper work and lesser paper storage space.” Master Direction – Know Your Customer (KYC) Direction, 2016 (Updated as on April 20, 2020), RBI/ DBR/2015-16/18 In terms of the provisions of Prevention of Money-Laundering Act, 2002 and the Prevention of Money-Laundering (Maintenance of Records) Rules, 2005, as amended from time to time by the Government of India as notified by the Government of India, Regulated Entities (REs) are required to follow certain customer identification procedures while undertaking a transaction either by establishing an account-based relationship or otherwise and monitor their transactions.

REs shall take steps to implement the provisions of the aforementioned Act and Rules, including operational instructions issued in pursuance of such amendment(s). Vide this direction, the RBI again acknowledged the use of digital signatures. Apart from RBI, other Government agencies like, Controller of Certifying Authority, also accepted the usage of the Digital signatures. 

PARA 2: Where the e-Sign Online Electronic Signature Service can be used?

An Application Service Provider (ASP) can integrate eSign online electronic signature service so that the users of that ASP will be able to use eSign. A physical paper form/document which is currently used to obtain digital signature certificate can be replaced by its electronic form and thereby facilitate electronic signature of the signer through eSign. ASPs who can be potential users of eSign include Government agencies, Banks and Financial Institutions, Educational Institutions etc.

COMMENT

In view of the Authors, guidelines with respect to use of digital/electronic signatures in relation to; opening of bank account, procuring loan, opening demat account and other bank related transactions, must be brought in universally. Though banks like Standard Chartered do provide the facility of digitally/ electronically signing the documents, still, there is a need for a categorical circular permitting the use of e-signatures. In light of the aforesaid instances, wherein the RBI permitted and encouraged the use of digital/ electronic signatures, it becomes imperative that such facilities be provided to the customers especially in these extraordinarily testing times. This suggestion of the authors is not restricted just to these trying times but must be considered for the future transactions also, as it will lead to a smooth-effectivetime-efficient-paperless banking system. This initiative will surely help in limiting outdoor movements, consequently aiding in containing of the virus; as they call it – we are all in this together.

Ambika Pratiyush Swain is a Managing Associate at L&L Partners Law Offices. The author wishes to thank Ms. Siddhi Kochar, final year law student studying at Amity Law School Delhi, Guru Gobind Singh Indraprastha University, for her valuable contributions.

Continue Reading

Trending