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Supreme Court’s Latest Verdict On The Coal Scam

Tarun Nangia

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SUPREME COURT’S LATEST VERDICT ON THE COAL SCAM

Callous, careless, and casual approach”, are the observations of the apex court against executive while pronouncing a historic judgment on one of the cases involving coal blocks allocation. The Three judges Bench of the Supreme court headed by Chief Justice of India (CJI) Justice NV Ramana imposed a Rs. 1 lakh fine on the central government for unlawfully levying penalties on BLA Industries Private Limited after wrongly including the company in the list of illegal allottees. The Bench, which also included Justices Krishna Murari and Hima Kohli, who authored the Judgment, termed the executive’s error as ‘callous, careless and casual.’ The case was argued by Adv. Abhimanyu Bhandari and Adv. Ayush Agarwal for BLA Industries.

The executive’s wrong decision led to the cancellation of a coal mining lease that was lawfully granted to BLA Industries. The Apex court observed that BLA Industries had lawfully followed the correct procedures by approaching the state government first seeking to obtain a mining lease. BLA Industries, the court said, was granted by the Mines and Mineral (Development and Regulation) Act, 1957 (MMDR Act). The central government had wrongly included BLA Industries in the list of 46 coal blocks submitted before the top court. Taking a dim view of the executive’s error, the Supreme Court said, “As a result of this callous, careless and casual approach of the respondent no. 1 – UOI, the present petitioner had to suffer loss and ignominy. Therefore, litigation costs quantified at ₹1 lakh shall be paid by respondent No.1 – UOI to the petitioner within four weeks.” The inclusion of BLA Industries in the list of 46 coal blocks resulted in the cancellation of the company’s mining lease by the Supreme Court in 2014.

The government had filed a contempt petition against BLA Industries for the non-payment of the levy. The Supreme Court dismissed the contempt petition calling it ‘meritless.’

Now imagine the pain of the company suffering losses not only financially but also the irreparable image dent caused by allegations levelled against them. And, BLA is not the only company, there are many more, look at the case of Jindal Steel and Power (JSPL). As per the Affidavit filed by Union on India in Supreme court, Union of India mentioned that a levy of Rs. 295 per tonne should be imposed on the companies for coal extracted by them. In the affidavit, it was wrongly mentioned that a levy of 295 per tonne on the coal extracted was suggested by the CAG report but in reality, the CAG report does not have any such suggestion to Anyone.

The wrong Affidavit was Misleading, resulting in Jindal Steel paying approximately 3300 crores as a penalty. Is this not an eye-opener?

Remember the observations made by the former CAG Vinod Rai. In 2011 – the Government sought Audit Reports by CAG on two key issues: 1) Allocation of Coal Blocks and 2) Augmentation of Coal Production. Vinod Rai, the then CAG – reported the findings and recommendations on the above issues to the Government vide the “Report of the Comptroller and Auditor General of India on Allocation of Coal Blocks and Augmentation of Coal Production” which was duly presented to the Lok Sabha by Prime Minister – Mr. Manmohan Singh. The CAG in its report supported the Parekh Committee’s recommendation for competitive bidding for the allocation of coal blocks. It alongside also surfaced observations and recommendations – a few of which may perhaps be too far-fetched and based on erroneous assumptions. There were evident anomalies in the CAG Report which were further misconstrued, misrepresented, and extrapolated by various stakeholder groups. However, it is important to duly surface the canard of assumptions and errors, which prevail as myths and have clouded the general perception of people. At the same time – also annihilate all misconceptions about the CAG report in the public domain.

ERRONEOUS ASSUMPTIONS MADE BY CAG

Excerpt: “Audit has estimated financial gains to the tune of Rs. 1.86 lakh crore likely to accrue to private coal block allottees (based on the average cost of production and an average sale price of open cast mines of CIL in the year 2010-11).” CAG made highly optimistic assumptions to arrive at the calculation of Rs. 1.86 Lakh Crore, which was based on unrealistic mine reserves and inflated margins. (6.2 Billion Reserves X Rs. 295 per Tonne = Rs. 1.86 Lakh crore) 1) 6.2 Billion Reserves It was assumed that 100% of the estimated reserves of the 218 captive coal blocks over 30 years would be mined. There is in contradiction to its observations and recommendations which took cognizance of the hardships and complexities of developing a Coal Mine. This was duly ascertained by the fact that out of 218 blocks only 40 blocks were operational. It is rather unfortunate that the CAG – a premier audit body of the country could have made calculations based on such notional and inappropriate factors. It is noteworthy to mention in reality – only 300 Mn tonnes of coal have been mined from the captive coal blocks over 20 years as juxtaposed to 6.2 Bn as assumed by CAG. 2) Rs. 295 per Tonne The calculation methodology is derived based on the difference between the average price realization of CIL and the average cost of CIL during the year 2010-11. Rs. / tonne a) Average sale price of all grades of CIL (Open Cast) mines for 2010-11 1028 b) Average Cost price of all grades of CIL (Open Cast) mines for 2010-11 583 c) Financing Cost 150 d) Therefore, average cost = (b + c) i.e. (583 + 150) 733 NET GAIN = (a-d) i.e. (1028 – 733) 295 It is difficult to fathom, how CAG could have erroneously benchmarked the margin price of low-grade coal (F & G so allocated to Private Producers) with that of high-grade coal of CIL mines to arrive at the Mythical figure of Rs. 295/tonne and that too derived from one Financial Year (2010-11) alone. Therefore, the reference figures were not authentic, since they were regardless of price, grade, and cost of production. a) This gross error is evident from the reported facts of CIL’s Annual Reports between the period 1993 – 2010 – which show that their margins have been significantly lower than Rs 295/tonne. b) Moreover, it is worth reckoning that comparative prices of low-grade coal that was mined by the private sector have ranged between Rs. 183 and Rs. 570 over the last 20 years. Thus 295/tonne – was not a truly representative figure and the basic premises of CAG’s calculations were incorrect. In the famous words of Sir Abraham Lincoln: ‘Truth is generally the best vindication against slander. Let’s hope for justice, it may be delayed but not denied. There are many companies who paid an additional levy of 295 Rs per Tonne and these companies are Punjab state electricity board, West Bengal State electricity board, Calcutta electricity supply corporation, and Hindalco respectively.

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Delhi HC finds Axis Bank in breach of its own undertaking given before the court

Tarun Nangia

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Delhi high court

The court says Axis Bank is bound by its undertaking given to the court in February 2021 & then in March 2021 that it will not go ahead with the substitution of the concessionaire in the PS Toll Road project, without court’s nod.
Delhi HC says Axis Bank’s undertaking was unconditional, and therefore it cannot rely upon any event under the Concession Agreement or the Substitution Agreement, to appoint a new concessionaire in the project.
PS Toll Road Pvt Ltd (PSTR), the concessionaire of the Pune Satara Toll Road project, had challenged the appointment of a new concessionaire in the project by the Axis Bank despite a stay on the process by the Delhi HC in March 2021.
PS Toll Road Pvt Ltd, in its appeal before the Delhi HC, has contended that Axis Bank was in breach of its own undertaking given before the court in 2021, that it will not finalize the bids or award the contract to a third party, thereby substituting the PS Toll Road Pvt Ltd
Court has issued notice to Axis Bank and the matter will be heard on 28 September. PS Toll Road Pvt Ltd is a subsidiary of Reliance Infrastructure Ltd. and was awarded the contract for six laning of 140 KM of stretch between Pune and Satara in Maharashtra on BOT basis. The project is now complete.

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Supreme Court: Permanent injunction cannot be sought on the basis of an unregistered agreement to sell

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Supreme Court: Permanent injunction cannot be sought on the basis of an unregistered agreement to sell

The Supreme Court in the case Balram Singh vs Kelo Devi observed and stated that a relief of permanent injunction cannot be sought on the basis of such an unregistered document/agreement to sell.
The bench comprising of Justice MR Shah and Justice Krishna Murari observed that a plaintiff cannot get the relief indirectly which otherwise he/she cannot get in a suit for specific performance.
In the present case, a suit has been filled by the plaintiff praying for a decree of permanent injunction restraining the defendant from disturbing her possession in the suit property, which was claimed on the basis of the agreement to sell of which was an unregistered agreement/document to sell on ten rupees stamp paper. The suit was dismissed by the Trial Court by the original plaintiff and refused to grant permanent injunction and allowed the counter-claim of the defendant. However, the First Appellate Court reversed the Trial Court judgment and decreed the suit. The second appeal filled by the defendant was dismissed by the High Court.
In appeal, the defendant-appellant contended that an unregistered agreement to sell is not admissible in evidence and that the suit filed by the original plaintiff was only for permanent injunction and she did not seek the relief for specific performance of agreement to sell by adopting a clever drafting as she was well aware that she would not succeed in the suit filled for specific performance on the basis of an unregistered agreement to sell. On the other hand, it was contended by the respondent-plaintiff that an unregistered document can be used for collateral purpose and therefore both, the first appellate Court as well as the High Court have rightly passed a decree for permanent injunction while considering the agreement for selling of collateral purpose for grant of permanent injunction.
The Apex Court observed, while allowing the appeal:
However, having conscious of the fact that the plaintiff might not succeed in getting the relief of specific performance of such agreement to sell as the same was unregistered, a suit was filed by the plaintiff simplicitor for permanent injunction only. In a given case, it may be true that an unregistered document can be used and/or considered for collateral purpose and at the same time, the plaintiff cannot get the relief indirectly which otherwise he/she cannot get in a suit for substantive relief, namely, in the present case filled for the relief of specific performance. Thus, the plaintiff cannot get the relief even for permanent injunction on the basis of such an unregistered document/agreement to sell, more particularly when the defendant specifically filed the counter-claim for getting back the possession which was being allowed by the learned trial Court. It has been cleverly prayed by the plaintiff for a relief of permanent injunction only and did not seek for the substantive relief of specific performance of the agreement to sell as the agreement to sell was an unregistered document and therefore on such unregistered agreement/document to sell, no decree for specific performance could have been passed. By clever drafting, the plaintiff cannot get relief.
Therefore, the court restored the Trial Court judgment dismissing the suit and allowing the counter-claim.

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Supreme Court refuses to stay EC proceedings on Shinde’s claim, ‘real’ Shiv Sena tussle

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Who is real Shiv Sena? SC leaves it to EC to decide

On Tuesday, a constitution bench of the Supreme Court allowed the Election Commission of India to go ahead and decide Maharashtra Chief Minister Eknath Shinde’s claim that his faction represents the “real” Shiv Sena.
The bench comprising of Justice D.Y. Chandrachud dismissed the plea of Uddhav Thackeray camps to stay the ECI proceedings. It was argued by Mr. Thackeray that the Shinde faction was facing disqualification proceedings for defection under the 10th schedule and that the ECI should wait until the question of disqualification was decided.
The Supreme Court stated during the hearing that there was a bit of problem with Mr. Thackeray’s argument that the ECI proceedings under the Symbols Order of 1968 should be “stultified” merely because of a disqualification process against the Shinde function was pending before the Assembly Speaker.
Also, the bench comprising of Justice M.R. Shah, Krishna Murari, Hima Kohli and P.S. Narasimha stated that “we direct that there would be no stay of the proceedings before the Election Commission”.
It was observed that the Thackeray-led Maha Vikas Aghadi government had collapsed after a revolt by Mr. Shinde and the 39 other legislators against the Sena leadership.
On June 30, Mr. Shinde was sworn in as the CM along with BJP’s Devendra Fadnavis as his deputy.
The Supreme Court had referred to a five-judge bench on August 30, the plea filled by the Thackeray and Shinde-led factions raising several constitutional questions related to defection, disqualification and merger.
It was also stated that it had been asked the Election Commission Of India (ECI) not to pass any orders on the Shinde faction’s petition that it be considered the “real” Shiv Sena and be granted the party’s poll symbol.
However, the bench led by the then Chief Justice N.V. Ramana has said that the batch of petitions raise important constitutional issues which is relating to the 10th schedule of the Constitution pertaining to the disqualifications, power of the speaker and the governor, and judicial review.
It is provided by the 10th schedule of the Constitution for the prevention of defection of the elected and the nominated members for their political parties and contains stringent provisions against defection.
Earlier, it has been submitted by Thackeray faction that party MLAs loyal to Shinde can save themselves from disqualification under the 10th schedule of the constitution only by merging with another political party.
It has been contended by the Shinde group that the anti-defection law is not a weapon for a leader who has lost the confidence of his own party.

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Supreme Court Collegium Recommends To Elevate Bombay HC Chief Justice Dipankar Datta As Judge Of Supreme Court

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Supreme Court Collegium Recommends To Elevate Bombay HC Chief Justice Dipankar Datta As Judge Of Supreme Court

The Supreme Court Collegium has recommended to elevate Bombay High Court Chief Justice Dipankar Datta as a Judge of the Supreme Court.
Justice Datta is the son of a former Calcutta High Court Judge, late (J) Salil Kumar Datta and brother-in-law of Justice Amitava Roy, former Supreme Court Judge and was born in February 1965.
However, in 1989, he obtained his LL.B. degree from the University of Calcutta and was enrolled as an Advocate on November 16, 1989. Further, he worked as a Junior Standing Counsel for the State of West Bengal from May 16, 2002 to January 16, 2004 and as a Counsel for the Union of India since 1998.
From June 22, 2006., he worked as a Judge of the Calcutta High Court. On April 28, 2020., he was elevated as the Chief Justice of Bombay High Court.
He has passed several significant judgements as CJ of the Bombay High Court, including home vaccination for the bedridden and has directed a preliminary enquiry against Anil Deshmukh – Maharashtra Home Minister at the time, and an authoritative pronouncement on an illegal construction.

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Supreme Court: Notice issued on DCPCR plea challenging Juvenile Justice Act 2021 amendments making certain offences non-cognizable

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Supreme Court: Notice issued on DCPCR plea challenging Juvenile Justice Act 2021 amendments making certain offences non-cognizable

The Supreme Court in the case Delhi commission for protection of child rights v UOI observed and issued in a petition filled by the Delhi Commission for Protection of Child Rights (DCPCR) challenging the 2021 amendment made to the Juvenile Justice (Care and Protection) Act 2015 (JJ Act), which came into force on 1st September, 2022, whereby certain categories of offences against children have been made non-cognizable.
The bench comprising of Justice D.Y. Chandrachud and the Justice Hima Kohli observed, the counsel, Advocate, Mr. Preteek K Chadha appearing for DCPCR argued that the amendment sets out a less stringent standard than the Code of Criminal Procedure, 1973 or the unamended JJ Act.
However, the commission is challenging the 2021 Amendment to the extent it made the following categories of offences non-cognizable:
A. Using of children for drugs peddling
B. Using of children by terrorists
C. Exploitation of the child employee
D. Cruelty against the children
It was observed when the offences are non-cognizalbe, the police cannot register FIR and the investigation can commence only on the basis of a complaint filed before the concerned Magistrate.
Further, in 2021, the Juvenile Justice (Care and Protection of Children) Amendment Act, 2021 was passed to amend various provisions of the Juvenile Justice Act, 2015 which received the assent of the President on 07th August 2021. As the Amendement Act is yet to be notified. Thus, there are 29 Amendments carried out in the Juvenile Justice (Care and Protection of Children) Act, 2015 by the Amendment Act, 2021.
It is stated that Section 26 of the Amendment Act categorizes serious offences i.e., offences with an imprisonment for a term of three years and above, but not more than seven years as non-cognizable offence. Such offences include sale and procurement of children, employment of children for child begging, exploitation of child employee, giving intoxicating liquor or narcotic drug to a child, etc.
It is argued by the commission that such categorization violates Article 14 and 21 of the Constitution of India and also various other international obligations under the United Nations Convention on the Rights of the Child for which India is a signatory. However, such categorization is contrary to the scheme of the Juvenile Justice Act which is progressive in nature and protects children against all forms of exploitation.
Before the Court, it was argued that the categorization is also contrary to the general scheme of IPC wherein offences punishable with imprisonment for more than three years are categorized as Cognizable whereas offences are punishable with imprisonment for up to three years as non-cognizable offence. Consequently, there is no reasonable justification or rational nexus sought to be achieved by reclassifying the cognizable offences as non-cognizable offences.
The petition stated that on 08.04.2022, it is mentioned that five State Commissions for Protection of Child Rights representing the States and Union Territories of Chandigarh, Delhi, Punjab, Rajasthan and West Bengal in exercise of their powers vested under Section 15 of the Commissions for Protection of Child Rights Act, 2005 recommended to the Government of India that a Bill be tabled in the Parliament for further amending the Juvenile Justice Act, 2015 in order to restore the cognizability status of the serious offences under the Juvenile Justice Act, 2015. It is stated by DCPCR that no such response has been received from the Central Government on the recommendations.
Against this backdrop, the plea has been filled seeking a declaration that declaring the amendment to Section 86 of the Juvenile Justice (Care and Protection of Children) Act, 2015 by way of Section 26 of the Juvenile Justice (Care and Protection of Children) Act, 2021 as unconstitutional and violative of Articles 14 and 21 of the Constitution of India to the extent it makes offences under the Act which are punishable with imprisonment for a term of three years and above, but not more than seven years as non-cognizable.

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Supreme Court live-streaming hearings for first time today

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The Supreme Court went live for the first time on Tuesday when the cases’ hearings, which were planned to be livestreamed during the day, could be viewed online. One of the three cases slated for live streaming was from Maharashtra and pitted Team Uddhav Thackeray against Team Eknath Shinde over a dispute over the Shiv Sena’s symbol, with the Election Commission already involved. This was the second live hearing where the attorney, Kapil Sibal, could be seen arguing.

Live broadcasting was recommended by the Supreme Court around four years ago.

The former chief justice of India, Dipak Misra, had passed the landmark ruling on September 27 on the live telecast of important proceedings, saying “sunlight is the best disinfectant”.

Following discussion on the issue by the whole top court on September 20, it was decided to begin live-streaming constitutional bench hearings this week. Chief Justice of India (CJI) Uday Umesh Lalit presided over the whole court meeting, and all the judges agreed that constitutional matters should be the first to be streamed live on a regular basis.

A bold plan to integrate the use of information and technology with India’s judiciary, the e-courts project’s third phase included the proposal to have an exclusive platform for live-streaming Supreme Court sessions.

The high courts in Gujarat, Orissa, Karnataka, Jharkhand, Patna, and Madhya Pradesh are some of the high courts that broadcast hearings live as well.

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