DRT  Legal  Solutions

(Debts Recovery Tribunal Legal Solutions) is an India based

Law Firm specializing in DRT, Securitisation, Sarfaesi, IBC, NCLT, Borrowers and Guarantors Solutions in Debts Recovery Tribunals,

Pioneers in Counter-claims and Damage Suits based on Law of Torts and Law of Damages 

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DRT Solutions Weekly Mail – 360th Issue dated 3rd April ’15

All Weekly mails right from 1st Issue to latest, click links on top of this page 

 

(1) Most Important Aspect to Win Against Banks – Discovery of Documents 

 

In order to win a case against banks, past several years we have been emphasizing in our several weekly mails the following:-

(a)   All bank litigations in DRTs are primarily based on documents, most of which are in power and possession of the banks.

(b)   Success of the said bank litigations depend as to how the borrowers obtain the said documents.

(c)   In legal parlance the method by which all the essential and material documents can be obtained is known as ‘Discovery of Documents’

(d)   The litigant borrower must study the Order-11 of CPC along with a good digest. After such study only, the application should be made to the DRT for inspection and production of documents.

(e)   Each and every document which is required must be analyzed as to its need and the same should be mentioned in the said application in detail. Despite our repeated telling in several weekly mails past several years, this is not being done. As a result the DRTs are rejecting such applications.

(f)    Had complete need of each and every document is mentioned in detail and if the DRT rejects such application, there are fair chances of getting success in Review and Appeal otherwise not.

(g)   The above matter just can not be left to the advocates. The borrowers will have to take special pains to prepare the said application and then sit with their advocates to understand all the details of the need of the said document. The borrower must be present in the DRT and help their advocate during the arguments. If required when the Review and Appeal are prepared the same process has to be repeated by the borrowers.

(h)   If adequate pains are taken by the borrowers and their advocates in securing discovery of the documents, no bank can win the litigation in DRT. However it is presumed that proper counter-claim has been pleaded and contested.

(2)       Impact of Tightened Sale of Bad Loans to ARCs 

RBI tightens sale of bad loans to asset reconstruction cos

 

http://www.moneycontrol.com/news/cnbc-tv18-comments/rbi-tightens-salebad-loans-to-asset-reconstruction-cos_1149185.html

 

The RBI has asked the ARCs to be 15 percent upfront, many ARC’s did not want to make any money out of those assets but just wanted the consulting fees which was a percentage of the value of the security receipts. 


 

The Reserve Bank of India (RBI) tightened non-performing assets (NPA) sale norms for the public sector banks in an attempt to tackle the bad loans situation. RBI says asset reconstruction companies (ARCs) will now have to invest and hold minimum 15 percent security receipts as against 5 percent held earlier. The move, however, may not particularly affect only the PSU banks, but all banks. Sale to assets reconstruction companies has been happening for the past ten years. Last year, the RBI forced banks to use more ARCs because there was a pile of assets and not everything was being used. The debt recovery tribunal (DRT), the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act (SARFAESI Act) were among those that were being used, but the ARC’s were not being used enough and so, upon being forced a large number of sales, some Rs 3,700 crore got sold in one year and the assets under management (AUM’s) increased. Now there were worries in banking circles that some of these sales could be a little artificial just to park some of the bad loans with the ARC’s, but that fear cannot be proved because three years are not over and not enough time elapsed for the market to find out whether those assets could be revamped But now, one can actually get to know within a year because one has to value the assets and pay the management consulting fees. Until now the ARC is paid 5 percent of what it valued those assets, the remaining 95 percent was paid only as security receipts more in the form of interest only (IO) user bonds paper. At the end of one year, if it is unable to recover loans, it was put back to the banks or to the extent that it was recovered. The RBI has asked the ARCs to be 15 percent upfront, many ARC’s did not want to make any money out of those assets, but just wanted the consulting fees which was a percentage of the value of the security receipts. There was always a desire not to value the assets lower. If an asset turned bad, if it was Rs 100 crore the only thing one got from it was the land, the scrap value of the plant and other stuff, which would be normally 70-75 percent or maybe much less.

If one values it at Rs 100 then the management fees increased and at the end of the year one has to push it back because he/she is unable to sell it off.

 

(3) Useful Information 

 

Dr V.P. Bansal, Indore has sent the following useful information:-

 

1.         Your shoes are the first thing people subconsciously notice about you. Wear nice shoes.

2.          If you sit for more than 11 hours a day, there's a 50% chance you'll die within the next 3 years

3.          There are at least 6 people in the world who look exactly like you. There's a 9% chance that you'll meet one of them in your lifetime.

4.          Sleeping without a pillow reduces back pain and keeps your spine stronger.

5.          A person’s height is determined by their father, and their weight is determined by their mother.

6.          If a part of your body "falls asleep", you can almost always "wake it up" by shaking your head.

7.          There are three things the human brain cannot resist noticing - Food, attractive people and danger

8.          Right-handed people tend to chew food on their right side

9.         Putting dry tea bags in gym bags or smelly shoes will absorb the unpleasant odour.

10.       According to Albert Einstein, if honey bees were to disappear from
earth, humans would be dead within 4 years.

11.       There are so many kind of apples, that if you ate a new one everyday, it would take over 20 years to try them all.

12.       You can survive without eating for weeks, but you will only live 11 days without sleeping.

13.       People who laugh a lot are healthier than those who don’t.

14.       Laziness and inactivity kills just as many people as smoking.

15.       A human brain has a capacity to store 5 times as much information as Wikipedia

16.       Our brain uses same amount power as 10-watt light bulb!!

17.       Our body gives enough heat in 30 mins to boil 1.5 litres of water!!

18.       The Ovum egg is the largest cell and the sperm is the smallest cell !!

19.       Stomach acid (conc. HCl) is strong enough to dissolve razor blades

20.       Take a 10-30 minute walk every day. & while you walk, SMILE. It is the ultimate antidepressant.

21.       Sit in silence for at least 10 minutes each day.

22.       When you wake up in the morning, Pray to ask God's guidance for your purpose, today.

23.       Eat more foods that grow on trees and plants and eat less food that is manufactured in plants.

24.       Drink green tea and plenty of water. Eat blueberries, broccoli, and almonds.

25.       Try to make at least three people smile each day.

26.       Don't waste your precious energy on gossip, energy vampires, issues of the past, negative thoughts or things you cannot control. Instead invest your energy in the positive present moment.

27.       Eat breakfast like a king, lunch like a prince and dinner like a college kid with a maxed out charge card.

28.       Life isn't fair, but it's still good.

29.       Life is too short to waste time hating anyone. Forgive them for everything !

30.       Don't take yourself so seriously. No one else does.

31.       You don't have to win every argument. Agree to disagree.

32.       Make peace with your past so it won't spoil the present.

33.       Don't compare your life to others. You have no idea what their journey is all about.

34.       No one is in charge of your happiness except you.

35.       Frame every so-called disaster with these words: 'In five years, will this matter?'

36.       Help the needy,Be generous ! Be a 'Giver' not a 'Taker'

37.       What other people think of you is none of your business.

38.       Time heals everything.

39.       However good or bad a situation is, it will change.

40.       Your job won't take care of you when you are sick. Your friends will. Stay in touch.

41.       Envy is a waste of time. You already have all you need.

42.       Each night before you go to bed ,Pray to God and Be thankful for what you'll accomplish, today !

43.       Remember that you are too blessed to be stressed.

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DRT Solutions Weekly Mail – 359th Issue dated 27th March ’15

All Weekly mails right from 1st Issue to latest, click links on top of this page 

 

 

(1) Latest & Useful SC Judgment which Validates Our Approach to Counter-claim by Borrowers 

 

In a recent SC Judgment published in the latest issue of DRTC Vol 15 No 1 February 2015(2) vide citation [2015(1) DRTC 164(SC)], Bank of Rajasthan vs VCK Shares, Civil Appeal No 8972 & 8973 of 2014 decided on 17.09.14, the following decisions totally validated our line of thinking past several years on the matter of counter-claim by th borrowers:-

(a)   The Bank filed an OA for Rs 8.62 crores before the DRT Kolkata. The Respondent entered appearance before the said DRT.

(b)   The Respondents also filed a civil suit before the Calcutta High Court for ‘No Debt Due’ as well as claiming Rs 8.95 crores in default.

(c)   The Bank resisted the said civil suit and accordingly the same was transferred to DRT. The DRT decided ‘No Debt Due’ and also awarded counter-claim of Rs 6.88 lacs.

(d)   The Bank challenged the DRT Order in the High Court. It was dismissed in default.

(e)   The Respondent also appealed against the order of the single judge to transfer the suit to DRT. The division bench allowed the Appeal filed by the Respondents.

(f)    The said judgment of the High Court has been questioned in this SC Judgment. The SC has analyzed various existing its judgments and finally came to conclusion to  refer the questions to a larger Bench:-

(i)            Whether an independent suit filed by a borrower is liable to be transferred to DRT and tried along with the OA by the DRT?

(ii)           If the answer is in affirmative, can such transfer be ordered by a Court only with the consent of the borrower?

(iii)         Is the jurisdiction of the Civil Court ousted by virtue of the DRT Act?

 

Our Contentions 

 

For past several years, we have been emphasizing the importance of counter-claim and ‘No Debt Due’ This has happened in this case. Further our view is that DRT is the only trial court to decide the counter-claim. Let us now await the decision of the larger Bench.


 

(2) SC Order Striking Down Sec 66A of IT Act 

 

The following news item is self explanatory:-

 

Supreme Court order striking down Section 66A of IT Act, which allowed arrests for objectionable content online, gets a thumbs up

TNN | Mar 25, 2015, 12.00 AM IST

 

In what can be termed as a huge victory for free speech and civil liberty, the Supreme Court of India yesterday struck down the IT Act Section 66A that made posting 'offensive' comments online a crime punishable by jail, terming it 'unconstitutional'.The section of the Act, regarded as draconian, was seen by many as infringing on an individual's right to freedom of speech. The apex court ruled that the section falls outside Article 19 (2), which relates to Freedom of Speech, and has to be struck down in its entirety ."Section 66A is unconstitutional and we have no hesitation in striking it down," said Justice R F Nariman, reading out the judgement. The news came after a long campaign by defenders of free speech. Here are some celeb reactions to the verdict:

The following celebrities felt satisfaction over the above SC Order:-

SHABANA AZMI, ACTRESS

RAHUL DACUNHA, THEATRE PERSONALITY

RICHA CHADHA, ACTRESS

PUNIT MALHOTRA, DIRECTOR

SUHEL SETH, SOCIAL COMMENTATOR

GUL PANAG, ACTRESS

MRUNALINI DESHMUKH, LAWYER

ADITI MITTAL, STAND-UP COMEDIAN


HOW IT STARTED

The first PIL was filed in 2012 after two girls in Thane were arrested for commenting against the shutdown in Mumbai, following a party leader's death. In 2013, the f apex court had come out with an advisory under which a person cannot be arrested without the police receiving permission from senior officers.

 

(3) Statins More Harmful 

 

Dr V.P. Bansal of Indore has sent the following useful information:-

 

Statins more harmful

That research team at Duke University includes two doctors who have admitted to taking money from Big Pharma.2

And one of them reportedly even makes a small fortune as a consultant and guest speaker for pharmaceutical firms.3

This kind of "scientific research" is worth big bucks to Duke.

According to the latest figures available, Duke's medical research institute in 2011 collected $215 million from corporations. Its closest competitor, MIT, collected $110 million in corporate cash.

I can tell you flat out: I refuse to prescribe statins. I believe they are dangerous and they do not prevent heart disease, despite what researchers at Duke and elsewhere claim.

If new patients come to my clinic and are taking statins already, my advice is firm.

I tell them: "Stop taking statins immediately. If you have any left, throw them in trash."

Statins, in fact, have potentially fatal side effects, such as liver dysfunction and acute kidney failure.

If you take statins, you may also have to deal with cataracts, depression, suicidal thoughts, weight gain, sexual impotency and severe muscle weakness.4,5

There is some very bad science behind the idea that people need to take statins to lower their cholesterol as a way of treating heart disease.

And these high-margin drugs generate a whopping $100 billion a year for the world's biggest pharmaceutical companies.

Recently, the American College of Cardiology, the American Heart Association and the American Diabetes Association all banded together to promote statins for diabetics – even though numerous studies show that statins cause diabetes.6,7,8,9

Now the medical establishment wants to give statins to children who have inherited high cholesterol levels from their parents.10,11

But cholesterol is bad marker of heart disease. As I explain in my new book, The Ageless Heart, cholesterol doesn't cause heart attacks. Inflammation causes heart attacks.

The body uses inflammation to cleanse away bacteria, viruses, fungi, damaged cells, and other nasty stuff. But too much inflammation damages the walls of your blood vessels and heart.

When that happens, the body uses cholesterol to patch the damage, turning it into plaque. Over time, the plaque becomes thicker and thicker until it blocks the blood flow, which leads to a stroke or a heart attack.

But plaque isn't the disease, it's a symptom of a bigger problem. The healthiest way to avoid heart attacks is to avoid inflammation.

But Big Agra doesn't make this easy. It's makes billions selling products that promote inflammation. Like cheap low-fat foods, loaded with sugar syrups, vegetable oils, refined grains, and toxic chemicals.

Here are some simple recommendations to reduce inflammation:

bullet

Take B vitamins. They will help reduce homocysteine levels in your blood. This amino acid can stop your blood vessels from dilating properly. When your blood vessels constrict, it increases your chances of having a stroke or heart attack.

bullet

I tell my patients to exercise five times a week, if they can. But even moderate workouts can help lower C-reactive protein – a  key indicator of inflammation - by 30 percent.12

bullet

Keep your gums healthy. Diseased gums cause inflammation.13 So brush and floss at least twice a day.

bullet

Reach for foods high in vitamin C: Citrus fruits like oranges, grapefruits, and lemons all have high amounts of this inflammation fighter. Red peppers are another good source. Supplementing with extra vitamin C is also a good idea.

bullet

Eat your greens: They contain loads of magnesium, a natural inflammation fighter. I also recommend heaping helpings of kale, Be sure to buy organic. if you can, because modern agricultural methods have reduced the nutritional value of many vegetables.

 

Al Sears, MD
11905 Southern Blvd.
Royal Palm Beach, FL 33411

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DRT Solutions Weekly Mail – 358th Issue dated 20th March ’15

All Weekly mails right from 1st Issue to latest, click links below:-

 

(1) PSBs Add Twice Bad Loans Than Pvt Banks 

 

The following news item is self explanatory:-

PSBs Add Twice Bad Loans Than Pvt Banks

By ENS Economic Bureau

Published: 18th March 2015 06:10 AM

Last Updated: 18th March 2015 06:10 AM

http://www.newindianexpress.com/business/news/PSBs-Add-Twice-Bad-Loans-Than-Pvt-Banks/2015/03/18/article2719024.ece

HYDERABAD: Notwithstanding rigorous processes for lending capital, public sector banks have surpassed private banks in adding bad loans, especially after recession.

While NPAs or bad loans of PSBs grew in healthy double digits after the 2008-global economic recession, private banks’ gross NPAs grew in lean single digits.

For instance, if the country’s largest bank SBI & Associates’ gross NPAs grew 25, 32 and a whooping 59 per cent in 2010, 2011 and 2012 respectively, private banks registered 3, 5 and 3 per cent growth during the same period. Similarly, 21 other nationalised banks saw their NPAs grow at 37, 22 and 56 per cent. Bad loans of foreign banks’ too grew, but nationalised banks’ overseas subsidiaries significantly contributed to the growth.

 Every time a bank lends money, it is required to set aside a part of that amount as provision in order to secure itself from a potential default. Unfortunately, industry experts say, the amount of provisioning made by PSBs is inadequate.

Worse, the percentage of bad loans of state-run banks, which account for over 70 per cent of the banking industry, is growing at an alarming pace. As on March 2014, all scheduled commercial banks, including private and foreign banks, together had Rs 2,64,194 crore worth bad loans. Of this, PSBs accounted for Rs  2,28,073 crore. In the following nine months, this rose to Rs 2,60,531 crore reflecting the pace at which nationalised banks’ bad loans are piling up.

Though NPAs are on the rise, the amount recovered by all the 84 banks operating in India through debt-recovery tribunal, lok adalats and Sarfaesi Act, is slipping. While they recovered 21.9 per cent of the total 8.4 lakh cases referred for recovery involving Rs 1 lakh crore in 2013, it fell to 18 per cent in 2014, even as the number of cases referred for recovery doubled to 16.36 lakh crore..

 

(2) Admissibility of Secondary Evidence 

 

The following news item is self explanatory:-

Admissibility of Secondary E-evidence under Indian Laws

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Article Views669

GroundReport | Author: nirajdp1571 
Filed Under: 
LawNews | Posted: 03/12/2015 at 12:51PM
0 Comments | Region: India

Due to the boom in the industry of e-commerce and tremendous increase in e-crimes, electronic evidence gained its importance and it has involved into a fundamental pillar of communication, processing and documentation. The various forms of evidence are increasingly being used in both Civil & Criminal Litigations. During trials, Judges are often asked to determine the admissibility of electronic evidence and it substantially impacts the outcome of civil law suit or conviction/acquittal of the accused in a criminal case. The Court continue to grapple with this new electronic frontier as the unique nature of e-evidence, as well as the ease with which it can be manipulated or falsified, creates hurdle to admissibility not faced with the other evidence. The various categories of electronic evidence including website data, social network communication, e-mail, SMS/MMS and computer generated documents poses unique problems and challenges for proper authentication.

The Indian Evidence Act has been amended by virtue of Section 92 of Information Technology Act, 2000 (Before amendment). Section 3 of the Act was amended and the phrase “All documents produced for the inspection of the Court” were substituted by “All documents including electronic records produced for the inspection of the Court”. Regarding the documentary evidence, in Section 59, for the words “Content of documents” the words “Content of documents or electronic records” have been substituted and Section 65A & 65B were inserted to incorporate the admissibility of electronic evidence.

In Section 61 to 65, the word “Document or content of documents” have not been replaced by the word “Electronic documents or content of electronic documents”. Thus, the intention of the legislature is explicitly clear i.e. not to extend the applicability of section 61 to 65 to the electronic record. It is the cardinal principle of interpretation that if the legislature has omitted to use any word, the presumption is that the omission is intentional. It is well settled that the Legislature does not use any word unnecessarily.

On the other hand, in Section 61 to 65 Indian Evidence Act, the word “Document or content of documents” have not been replaced by the word “Electronic documents or content of electronic documents”. Thus, the omission of the word, “Electronic Records” in the scheme of Section 61 to 65 signifies the clear and explicit legislative intention, i.e. not to extend the applicability of Section 61 to 65 to the electronic record in view of overriding provision of Section 65-B Indian Evidence Act dealing exclusively with the admissibility of the electronic record which in view of the compelling technological reasons can be admitted only in the manner specified under Section 65-B Indian Evidence Act.

The main objective to introduce the specific provision has its origin to the technical nature of the evidence particularly as the evidence in the electronic form may not be produce in the court of law owing to the size of computer/server, residing in the machine language and thus, requiring the interpreter to read the same. The Section 65B of the Evidence Act makes thesecondary copy in the form of computer output comprising of printout or the data copied on electronic/magnetic media.

In the matter of Anvar P.V. versus , P.K. Basheer And Ors. [MANU/SC/0834/2014] is significant judgment, the Supreme Court has settled the controversies arising from the various conflicting judgments as well as the practices being followed in the various High Courts and Trial Courts as to the admissibility of the Electronic Evidences. The Court has interpreted the Section 22A, 45A, 59, 65A & 65B of the Evidence Act and held that data in CD/DVD/Pen Drive are not admissible without a certificate U/s 65 B(4) of Evidence Act. It has been elucidated that electronic evidence without certificate U/s 65B cannot be proved by oral evidence and also the opinion of the expert U/s 45A Evidence Act cannot be resorted to make such electronic evidence admissible.

The judgment would have serious implications in all the cases where the prosecution relies on the electronic data and particularly in the cases of anticorruption where the reliance is being placed on the audio-video recordings which are being forwarded in the form of CD/DVD to the Court. In all such cases, where the CD/DVD are being forwarded without a certificate U/s 65B Evidence Act, such CD/DVD are not admissible in evidence and further expert opinion as to their genuineness cannot be looked into by the Court as evident from the Supreme Court Judgment. Electronic records being more susceptible to tampering, alteration, transposition, excision, etc. without such safeguards, the whole trial based on proof of electronic records can lead to travesty of justice.

In the anticorruption cases launched by the CBI and anticorruption/Vigilance agencies of the State, even the original recording which are recorded either in Digital Voice Recorders/mobile phones are not been preserved and thus, once the original recording is destroyed, there cannot be any question of issuing the certificate under Section 65B(4) of the Evidence Act. Therefore in such cases, neither CD/DVD containing such recordings are admissible and cannot be exhibited into evidence nor the oral testimony or expert opinion is admissible and as such, the recording/data in the CD/DVD’s cannot become a sole basis for the conviction.

In the aforesaid Judgment, the Court has held that Section 65B of the Evidence Act being a ‘non obstante clause’ would override the general law on secondary evidence under Section 63 and 65 of the Evidence Act. The Section 63 and Section 65 of the Evidence Act have no application to the secondary evidence of the electronic evidence and same shall be wholly governed by the Section 65A and 65B of the Evidence Act. The Constitution Bench of the Supreme Court overruled the judgment laid down in the State (NCT of Delhi) v. Navjot Sandhu alias Afsan Guru[(2005) 11 SCC 600 by the two judge Bench of the Supreme Court. The court specifically observed that the Judgment of Navjot Sandhu supra, to the extent, the statement of the law on admissibility of electronic evidence pertaining to electronic record of this Court, does not lay down correct position and required to be overruled.

In the recent matter of Jagdeo Singh Vs. The State and Ors.[MANU/DE/0376/2015] pronounced by Hon’ble High Court of Delhi, while dealing with the admissibility of intercepted telephone call in a CD and CDR which were without a certificate u/s 65B Evidence Act, the court observed that the secondary electronic evidence without certificate u/s 65B Evidence Act is inadmissible and cannot be looked into by the court for any purpose whatsoever

The admissibility of the 

secondary electronic evidence has to be adjudged within theparameters of Section 65B of Evidence Act and the proposition of the law settled in the recent judgment of the Apex Court and various other High Courts as discussed above. The proposition is clear and explicit that if the secondary electronic evidence is without a certificate u/s 65B of Evidence Act, it is not admissible and any opinion of the forensic expert and the deposition of the witness in the court of law cannot be looked into by the court. However, there are few gaps which are still unresolved as what would be the fate of thesecondary electronic evidence seized from the accused wherein, the certificate u/s 65B of Evidence Act cannot be taken and the accused cannot be made witness against himself as it would be violative of the Article 19 of the Constitution of India.

(3) Starting a Laughter Club  

 

Our web page on Laughter has become quite popular and may be reached by clicking the linkhttp://www.drtsolutions.com/Laughter-Yoga-Ram%20Kishan.htm This page gives the scientific and medical details of numerous benefits of sustained laughter of 10 to 15 minutes. That is why ‘Laughter Yoga’ has spread in 72 countries and there are lacs of Laughter Clubs. On account of tremendous health benefits, several persons have desired to know as to how they can start a Laughter Club. In the said web page, we have given the process as to how one can start a Laughter Club. We have published more than 60 videos on YouTube. The said videos can be reached by searching “Laughter Yoga Ram Kishan” in YouTube. The links of each of the said videos have also been given the said web page. You will gain a lot by studying the said web page. If you have any query, you may ring me at 09691103689. I can only say that the ‘Laughter Yoga’ is the best overall exercise for body, mind and spirit needing least time period of 20 to 25 minutes daily.

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DRT Solutions Weekly Mail – 357th Issue dated 13th March ’15

All Weekly mails right from 1st Issue to latest, click links on top of this page

 

(1) New RBI Rule forcing Banks to apply their Mind while Restructuring  

Mr Himanshu Mehta, one of our clients from Mumbai has referred to the following news item which is self explanatory:- 

Will the new RBI rules on bank loans prove to be a lender bender?

By Sangita Mehta, ET Bureau | 11 Mar, 2015, 06.44AM IST

http://economictimes.indiatimes.com/industry/banking/finance/banking/will-the-new-rbi-rules-on-bank-loans-prove-to-be-a-lender-bender/articleshow/46522968.cms?curpg=2

Like many things that happen only in India, for years Indian banks have been following a practice that lenders in other countries don't. They rejig loans of troubled borrowers — charging them lower interest, allowing them a longer repayment time — to save the loan from turning bad and protect the bank bottomline.

The beauty of the arrangement is that banks have to provide very little — meaning, they have to set aside a smaller amount — for such "restructured loans" as compared to the much higher provisioning specified for bad loans, better known as non-performing assets, or NPAs.

After April, banks can no longer resort to this comfortable book-keeping. Since there will be no difference between NPAs and restructured assets, banks will have to set aside 15% of restructured loans as provisions as against 5% they do now.

The annoyance among bankers, who have been under the spotlight for mounting bad loans, is understandable: higher provisioning means lower earnings; and, the quality of their loan book will look worse than what appears now. The fear is that if growth fails to take off, there won't be too many other earning avenues to make up for the loss.

THE GENESIS

The new rule owes its origin to reforms that followed Manmohan Singh's first budget. On April 27, 1992, the Reserve Bank of India (RBI) asked banks to treat all restructured loans as problem loans, thus attracting higher provisions. The idea, back then, was to be in line with international best practices.

A decade later, when large financial institutions like ICICI and IDBI were planning to become banks, these lenders lobbied for a change. They argued that many projects were stuck due to external factors like delays in clearance from various state and central authorities and even promoters who were willing to service loans were unable to pay as cash generation had been delayed by time and cost overruns.

Around the same time, environmental issues in special economic zones had cropped up and land acquisition for several projects hit a roadblock. Faced with these ground realities, RBI agreed to change the norm. According to the revised rule, restructured norms were no longer classified as problem loans. In one shot, provisions on such loans fell to 2% from 10% (that applied to NPAs then). RBI coined a new basket for such loans: "restructured standard assets".

POSTPONING THE PROBLEM

The rule relaxation, however, came with some guidance. "Banks," the new rules said, "can undertake restructuring if in their opinion the bottleneck in achieving regular commercial production was of temporary nature, not indicative of any long-term impairment of the unit's economic viability and if the unit was likely to achieve cash break-even if some time was allowed."

Soon many banks, desperate to show improved balance sheets, began to ignore the advice. Between March 2002 and 2013, banks' loan book grew by 779% to Rs 59,89,182 crore while the portfolio of restructured loans grew by 3,087% to Rs 3,13,003 crore.

Analysts say a predominant number of loans were restructured without looking into merit. Due diligence was slack and often project viability was not scrutinised. Indeed, RBI, in its annual inspection of banks, observed "banks lacked clarity" while restructuring advances. The regulator feared 25-30% of the restructuring would fail to turn around. Questions were raised in RBI on whether banks had the cushion to absorb the shock if some of loans sank.

When the share of restructured loans overtook that of problem loans, RBI stepped in. Addressing the media, RBI governor Raghuram Rajan recently said, "It's important we clean up bank balance sheets and show what they actually contain. That will enhance confidence in bank balance sheets and enable banks to raise the much needed fresh capital. In order to build confidence in bank balance sheets, we have to come to an end of forbearance... It is to call a spade a spade."

It was an open secret that many loans were restructured simply to postpone the problem. Troubled promoters with high leverage and ambitious projects were given a long rope. By chipping in as little as 2% of restructured debt as extra equity from promoters, these borrowers bagged concessions on interest rates and one to two years of repayment holiday.

In 2013, RBI brought back the old rule of the '90s. It spelt out that the moment a loan was restructured it should be treated as a problem loan with higher provisioning. Banks were given two years' time to migrate to a stricter loan classification and accounting rule, though the rule was not applied uniformly for all loans.

A special dispensation was thrown in for new promoters, infrastructure and certain non-infrastructure projects (excluding services and real estate); if the projects were not completed within the timeframe envisaged in the agreement, the restructured loans for entities within these categories could be treated as a performing asset for six months, two years and one year respectively.

THE WAY OUT

With the rules of the game changing, banks should add a few things in their rule book to minimise the number of loans that would have to be restructured. Besides sanctioning loans on time and ensuring that promoters commit adequate equity capital, lenders should strengthen credit monitoring and examine possible external factors that could affect the project.

They should factor in the worst case scenario such as long delay in gas supply, hurdles in land acquisition and environmental clearance while appraising a loan proposal and ask the promoter to prepare a contingency plan. Also, the MD and CEO of a bank should be as accountable for a loan turning bad as the mid-level officers who sanctioned the loan and failed to monitor the account.

STOP KID-GLOVE TREATMENT

The special forbearance on classification of restructured loans for select segments such as infrastructure, new promoters etc, distorts the market. RBI should do away with this. The world over, corporates try to make the best of regulatory arbitrage. Giving dispensation to a select category of borrowers will not only defeat the purpose of showcasing a clean balance sheet to the international community but also encourage banks to restructure loans that do not merit concessions.

A special dispensation could end up favouring those who have the wherewithal to undertake large infrastructure projects like power and ports; it could also benefit 'new promoters' (having links with old business families) looking at acquiring manufacturing units. Any dispensation to one category of borrowers is discrimination to others. Such dispensation could also encourage inefficiencies of government departments.

A dispensation is given when corporates are unable to obtain timely clearances on access to coal, gas and environmental clearances from state and central authorities. By giving the dispensation, the regulator may be unwittingly tolerating government agencies' indiscipline and inability to take timely decisions. In a democracy, inefficiencies at the Centre can be better addressed if the affluent who can lobby feel the pinch.

RBI can, alternatively, choose an easy option. A loan to a project not completed within the given date is treated as substandard even if there is no default in servicing the loan. This can be changed to treat a loan as standard assets, irrespective of when the project is completed, as long as the borrower pays on time.

Former deputy governor KC Chakrabarty had once said: "Flexibility in regulatory prescription is sometimes coveted, arbitrariness in regulation would lead to the build up of 'fault lines' in the system. A uniform approach — either principle or rule-based regulation — needs to be adopted and consistently followed so as to bring the necessary stability in credit risk management practices across banks and eliminate ad hoc implementation processes."


(2) SARFAESI to boost NBFCs Recovery 

 

The following news item is self explanatory:-

SARFAESI coverage to boost NBFCs recovery of loans: Moody’s

K. R. SRIVATS

HTTP://WWW.THEHINDUBUSINESSLINE.COM/INDUSTRY-AND-ECONOMY/BANKING/SARFAESI-COVERAGE-TO-BOOST-NBFCS-RECOVERY-OF-LOANS-MOODYS/ARTICLE6975108.ECE

NEW DELHI, MARCH 9:  

The budget announcement to expand the coverage of SARFAESI law to certain NBFCs would be “credit positive” for lenders of loans against property (LAP), global rating agency Moody’s has said.

Designating non banking finance companies (NBFCs) with assets of more than  500 crore as “financial institutions” under the SARFAESI law would speed up lenders’ repossession of LAP, according to Moody’s Credit Outlook.

This is because such NBFCs would have the ability to demand repayment of any defaulted loan within 60 days after the lender classifies such loans as non-performing assets (NPAs).

LAP is a loan made against residential or commercial property already owned by the borrower

Residential mortgage backed securities (RMBS) backed by LAPs originated by these NBFCs would also benefit from speedier loan recovery, Moody’s has said.

LAPs are often taken out by small business proprietors who repay the loan using cash flow from the business housed in that property.

Among the NBFCs that are active in LAPs and that would benefit from the budget proposal are Cholamandalam Investment & Finance (unrated), Indiabulls Financial Services (unrated), Magma Fincorp (unrated), Reliance Capital (unrated), Religare Finvest (unrated) and Fullerton India Credit Company (unrated).

All these NBFCs have been active in securitization, Moody’s has said.

If the defaulted borrower refuses to repay the outstanding loan in full within 60-days of notice, lenders would be allowed to seek repossession through the chief metropolitan magistrate or district magistrates in the jurisdictions in which the properties are located.

Under the current practice, NBFCs must resort to civil court proceedings to recover their loans and take repossession of a property whose recovery time is difficult to determine.

Repossession through the chief metropolitan magistrates and the district magistrates, which normally takes 18-24 months, should offer a speedier recovery.

Besides more standardized protocols around loan recovery, inclusion under the SARFAESI Act would allow lenders to take over the management of a borrower’s business if the defaulted borrower does not discharge his liability in full.

Based on fiscal 2013 data from the Reserve Bank of India, NPA recovery through the SARFAESI Act (as opposed to debt recovery tribunals and other recovery means) accounted for about 80% of the total amount of the banking sector’s NPAs recoveries at  23,200 crore, and the collection rate was 27.1%.

(3) Health Tips on Bones 

 

Mr U.C. Desai from Ahemdabad has sent the following useful information:-

Health tips on bones 

For good health, besides many aspects , exercise , laughing , healthy diet , life style etc. , we need to keep in view importance of bones of the body, which is at core foundation of body structure and also for it's functioning.Hence let us know about bone for maintaining good health.

                      How to Keep Your Bones Strong


The base on which our whole body is built is the skeleton, from which we get our stability, our ability to move and function.
 
Our bones are also a factory for manufacturing red and white blood cells.
 

It's extremely important to keep bones strong and healthy, especially in more advanced ages, when calcium seems to drain away.

A little about bone depletion:
Bone depletion, or osteoporosis, is a disease that occurs as a result of dwindling bone mass and a decrease in the levels of calcium.
 
Along our whole life, our bones are in a continuous process of construction and destruction.
 
However, at a young age, there is more construction than destruction.
 
Things even out as we grow older until, in our fourth decade, destruction finally overtake construction.
 
As a result, our bone density drops and our bones become more prone to fractures.
 
When this process happens in an extreme way, it is known as bone depletion.
 
It's important to note that losing calcium also makes the bones more sensitive, even if it happens slowly.
 
At an older age, when our balance is not what it used to be, the danger only gets worse.
 
Because women start with a bone density that is already about 30% less than men's, and because they produce less estrogens as they grow older, they must face a bigger risk when it comes to bone depletion.


What is the recommended calcium amount?
The process of bone depletion in the body is a natural one and cannot be prevented.
 
But it can be minimized in volume and influence, by maintaining our bones and building bone mass through correct nutrition.
 
The daily calcium amount recommended for the general population is 1000 mg a day.
 
For adults it is 1200-1500 mg a day. In addition, vitamin D is also important, as it helps the calcium absorb in the body.
 
So if you want to keep your bones strong, you should also consume vitamin D rich foods.
 
You can get it from the sun or from food, but it's important to have.


10 Tips to Keep Our Bones Strong
1. Consume milk products -
 
Every child knows that milk is rich in calcium and is essential for strengthening bones.
 
This goes for all milk products, including cheese, yogurt and alike.
 
If you don't like cow's milk, try soy milk enriched with calcium.
2. Add nuts to your diet -
 
Although milk has the highest ratio of calcium to volume, it is not the only source.
 
Some nuts and seeds have handsome amounts of calcium.
 
A 30 gram course of almonds contains 75mg of calcium, 30 grams of sesame seeds contains 37mg of calcium and sunflower seeds have 33mg of calcium.
3. Eat dark green vegetables –
 


Broccoli, Chinese cabbage, arugula, parsley, lettuce and others are excellent sources of calcium, and contain many additional health advantages.
 
This will help you to also diversify your sources of calcium, which is important to maintain your health.
4. Take the right Vitamin A -
 
Vitamin A appears in two forms.
 
The first is retinol, which appears in animal products, such as the liver.
 
The second is beta carotene and it is the way the vitamin comes from plants, especially orange vegetables like carrot, squash or sweet potato.
 
Studies have found that consuming too much of retinol vitamin A raises the risk of bone fraction, while vitamin A in its plant form, Beta Carotene, does not damage the bones.
5. Strengthen your bones with Vitamin K -
 
This vitamin helps activate 3 essential proteins that are crucial for bone health.
 
As in the case of calcium that comes from green vegetables, vitamin K also comes from the same sources.
 
Two daily helpings of green vegetables a day give the body as much as it needs.
6. Physical activity strengthens the bones -
 
Sorry, you knew this was coming and its of very little surprise.
 
When we carry out a physical activity, we create pressure on our skeleton.
 
While it is bad to overdo it, a moderate pressure is actually very health, as it sends the body signals to create more bone cells, increase the density and make it stronger.
 
Operate the body with moderation, and don't go to far with it.
7. Eat fish -
 
100 grams of sardines contain an amazing amount of over 400mg of calcium!
It's recommended to consume the fresh fish of course and not the canned variety.
 
The little bones are also edible and contain a lot of calcium. Sardines, like the salmon, are also a great source of vitamin D.

 8. Reduce your consumption of carbonated drinks and treats - 
The acid that exists in some of the popular carbonated drinks raises the amount of acid in the blood.
 
To compensate, the body uses the body's minerals, including calcium.
 
If the calcium is not readily available in the blood, the body will take it from the bones and this will hard the density and strength of the bone.
 
There is no problem drinking them once in a while, but if they are a daily habit then you can do a lot of damage to your bones over time.
9. Avoidance measures -
 
Like a lot of other health problems, we return to smoking.
 
Studies have shown that smoking harms bone density, as well as over consumption of alcohol and caffeine.
10. Resource allocation -
 
We must carry out our calcium consumption in a smart way.
 
Our body absorbs calcium best when it is no more than 500mg at one time.
 
So, if you are planning on consuming a large amount of calcium rich foods or drinks, try to perhaps divide the meal or eat again later, to make sure the body is able to absorb all you are giving it.

 

U.C.Desai (M) 09374556625

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DRT Solutions Weekly Mail – 355th Issue dated 27th February ’15

All Weekly mails right from 1st Issue to latest, click links on top of this page

 


 

(1) Judiciary: Biggest Economic Bottleneck 

 

The following news item is self explanatory:-

Judiciary: the biggest economic bottleneck

NITIN POTDAR

http://www.thehindubusinessline.com/opinion/judiciary-the-biggest-economic-bottleneck/article6913387.ece

 

The best way to deal with case backlog is to create a collaborative environment, as demonstrated in income tax matters

 

The country’s legal and judicial systems play a crucial role in deciding the pace and quality of its economic performance. The World Bank Report on Doing Business has identified streamlined court processes and faster contract enforcements as the paramount factor shaping efficient and effective business environments worldwide. In fact, the backlog of more than three crore court cases is by far the biggest impediment to the Prime Minister’s call to ‘Make in India’ as also his aspiration to improve India’s Ease of Doing Business ranking.

The discussion has assumed importance again with the latest directive, by the current Chief Justice of India HL Dattu, asking high court judges to file verdict details that also reflect qualitative assessments.

Efforts to speed up

Many governments have, in the past, attempted to speed up the judiciary. The previous law minister, Veerappa Moily, had outlined an ambitious road map to reduce litigation life from 15 years to 3 years, the inception of as many as 5,000 supplementary courts to be serviced by more than 15,000 retired judges, and setting up separate commercial courts for high value disputes.

Likewise, the former CJI AM Ahmadi had called for head-wise classification of cases and their ensuing allotment to specific benches for specific terms to ensure quick clearance. We have, from time to time, heard about the acute need for robust computerisation and intelligent case management. Although these are logical recommendations, they are long-term measures involving substantial lead times and cost.

We should welcome the income tax department’s momentous recent decision of not filing an appeal against the Bombay High Court decision in the case of Vodafone. The unconditional acceptance of the attorney general’s opinion is a step of far-reaching positive consequences.

Today, the number of cases filed by or against the revenue department total more one crore. These disputes can be categorised subject-wise and then deliberated internally amongthe tribunal heads under a team of retired Supreme Court judges aided by the attorney general and the finance minister, if required.

This in itself would substantially reduce the courtroom burden. It would also revive the reputation of the tax department.

Practical solutions

Similarly, the labour minister can demand categorisation of disputes under provident fund, gratuity or industrial laws before passing them through the funnel of resolution. Thousands of cases and appeals are pending under various State and municipal laws. There’s a lot to be achieved by consensual collaboration.

Each ministry can form a small team and request a retired Supreme Court judge to opine on pending disputed issues and direct the departments to effect a fast resolution. This may well script a revolution in the Indian judicial system. Law colleges, public institutions and industry chambers must come forward to initiate and support these initiatives.

Bulk disposition by consensus is the only way out of the humungous backlog of civil litigation. Compounding is another process to clear backlog in bulk.

Setting up Supreme Court benches in Mumbai, Chennai and Kolkata would help thousands of litigants who otherwise end up travelling all the way to Delhi. The Bombay Lawyers’ Association has already proposed the idea of an apex court bench in Mumbai while the Law Commission of India has been consistently recommending that Supreme Court benches be set up in Chennai, Hyderabad, Kolkata and Mumbai.

We can gainfully follow the Chinese model where law students are encouraged to appear for the national judicial examination to ensure a steady pipeline of quality judges at least in the lower judiciary. We can emulate the Singapore model of massive computerisation for case management and technological framework. Like Malaysia, we can fix disposal targets for older cases and like Italy, we can foster pre-judicial negotiations for amicable resolution.

Clearing the mounting backlog in our judicial backyard is certainly doable with strong political will.

The writer is the M&A partner at J Sagar Associates. The views expressed are personal

(This article was published on February 19, 2015)

 

(2) Debt Recast Failing, NAPs may Cross Rs 30,000 Crores  

The following news item is self explanatory:-

Debt recast scheme failing, NPAs may cross R30K crore


Written by George Mathew | Mumbai | February 24, 2015 2:46 am

http://indianexpress.com/article/business/business-others/debt-recast-scheme-failing-npas-may-cross-r30k-crore/

After non-performing assets, it is now the turn of restructured debt packages that have got banks worried.

Debt restructuring packages of 121 companies with loans of over Rs 30,000 crore have failed during the last four years, and banks fear that number is set for a sharp rise in the coming months.

Figures available with the Corporate Debt Restructuring (CDR) cell of banks — considered as the “intensive care unit” for financially troubled corporates — show that CDR packages of 86 companies with loans of Rs 14,000 crore failed in 2013-14. In 2012-13, 12 CDR cases for Rs 4,300 crore and in 2011-12, 9 cases for Rs 3,000 crore failed.

These CDR packages failed — from virtually zero to Rs 30,000 crore in four years — even after banks doled out interest rate cuts, moratorium on repayment and in some cases even a haircut by the lenders. After taking into account the stressed loan cases withdrawn from the CDR mechanism, the total amount involved in unsuccessful restructuring comes to Rs 50,104 crore, says the CDR Cell of banks, created under the RBI’s regulatory framework.

RK Bansal, chairman of the Cell said, “One worry is that in cases which we have restructured failure rates might go up. We have noticed that failure rates had gone up during the last year. This is partly because these cases were restructured during 2011-12 and 2012-13.”

“They were based on some projections that the economy will do well and demand will rise etc. In some cases it was not possible to comply with or achieve that,” Bansal said.

Banks had gone overboard in estimating demand and the promoters’ capability in bringing money.

There are two options when a company’s CDR package fails to click. “One is the company perhaps needs another package if it is viable. But as per the RBI guidelines, if it is a second restructuring then it becomes an NPA. The second option before the bank is legal action,” Bansal said.

Some of the top corporates whose CDR packages failed include Bharati Shipyard (Rs 3,500 crore), Hotel Leela (Rs 3,000 crore), Electrotherm, Jayabharat Textiles and Surya Pharma.

While announcing the Q3 results, ICICI Bank MD & CEO Chanda Kochhar said the bank’s fresh slippages stood at Rs 2,279 crore during quarter, with almost Rs 776 crore, coming from advances restructured in the past.

The trend of restructured assets slipping into NPAs is expected to continue for another 2-3 quarters.

“The government needs to amend the Sarfaesi Act and tighten rules governing debt recovery tribunals to speed up recoveries,” said the chairman of a nationalised bank.

Rs 65,295 crore proposals rejected, Winsome, Shree Ganesh lead list

MUMBAI: The CDR cell of banks has rejected / closed before approval as many as 121 proposals for debt restructuring worth around Rs 65,295 crore.

“Many of these cases are wilful defaults and fund diversion. “We need a tough law to tackle such wilful defaulters,” he said.

Two such cases are that of Winsome Diamonds and Shree Ganesh Jewellery where banks conducted a forensic audit and found evidence of fund diversion. The application was rejected.

“We need a tough law to tackle such wilful defaulters,” a senior banker said.

 

(2) Laughter Yoga – My Personal Experience 

 

This is my personal experience that ‘Laughter Yoga is the best overall exercise for body, mind and spirit in least possible time’ Accordingly I have created a separate web page on our web site vide linkhttp://www.drtsolutions.comE/Laughter-Yoga-Ram%20Kishan.htm Kindly go through this web page, extract of which is reproduced below:-

Introduction about Laughter Clubs

A breakthrough technology called Laughter Yoga, which Dr Madan Kataria (A MBBS Doctor in Mumbai) discovered in 1995. It started as a social Laughter Club in Mumbai, India.

There are now thousands of Laughter Clubs in more than 72 countries. A rapidly growing global phenomenon, Laughter Yoga is now being practiced in companies, old age homes, schools, colleges, fitness centres, community centres, prisons, hospitals, homes for the physically and mentally challenged and cancer self-help groups. It is being touted as perhaps the best alternative health therapy for complete body mind wellness.

Our Laughter Club at Indore

Mr A.L. Jain (known as Raja Babu) of Indore while in Mumbai visited Laughter Clubs and on return started the same in a park at Indore. He went round park to park and started such clubs past 20 years. On 30.10.2015, he came to our ‘Man Pasand Park, Palasia’ at Indore and started such club. After two months, we found the activity quite monotonous.  To get rid of monotony, I studied various web sites on internet and found that there are numerous ways and means to do so. As an initiative, I started giving practical demonstration of an unique exercise daily. From 16th Feb ’15, we started making videos of the said exercise and posting the same on special WhatsApp Group. From 24th Feb ’15, we started uploading the same on YouTube.  

In fact I already had following materials on ‘Laughter’:-

(1)    ‘Sant Anubhav’ – A book by Narayan Swami published in 1973.  The 10th Chapter in this book is titled ‘ Treatment by Laughter’

(2)    I shot a video on ‘Yoganand’ (Age 102 yrs) at Indore on 09.01.10 when he demonstrated few exercises on ‘Laughter Yoga’  https://www.youtube.com/watch?v=GuT3Eu3jbLM#t=171 The ‘Laugher Club of Indore’ also demonstrated few more exercises.

(3)    In 2010, I recorded a TV Program by Swami Ramdevji on ‘Hasya Yog’

https://www.youtube.com/watch?v=9Fip8S3c1hA&feature=youtu.be

(4)    In 2013, we visited ‘Yog Gram’ Haridwar where I shot a video of Dr Nagendra Kumar Neeraj (World famous Naturopath} who demonstrated few exercises on ‘Laughter Yoga’ https://www.youtube.com/watch?v=8q4BMOp1Vv4&feature=youtu.be

(5)     I had several cuttings from news papers on benefits of ‘Laughter’

Hence I readily joined the ‘Laughter Club’ of our Park.  

The following videos have been published by us on the YouTube:-

(1)   - Thanks to Self – When we are laughing so nicely, we should thank ourselves

http://youtu.be/RaoPXOnJF9M

(2)   -  Handshake – We can have heartily laugh while shaking hands.

https://www.youtube.com/watch?v=8gp4wSQU50U&feature=youtu.be 

(3)   -  Ants in Garments – Imagine that there are ants in the garments, the consequent activity gives rise to this laughter    https://www.youtube.com/watch?v=KJrL5_1zHmo&feature=youtu.be

(4)   – Combination Laughter

https://www.youtube.com/watch?v=5qIc_Re2QFw&feature=youtu.be

(5)   – Laughter like Children

https://www.youtube.com/watch?v=yT8312XHJoQ&feature=youtu.be

(6)   –Laughter like Young Persons

https://www.youtube.com/watch?v=buD_uZAVJLQ&feature=youtu.be

(7)   – Laughter like Old Persons

https://www.youtube.com/watch?v=k0ZHpEqn6lk&feature=youtu.be

(8)   – Laughter by Weeping Persons

https://www.youtube.com/watch?v=CQmbYbDPcl0&feature=youtu.be

(9)   – Car Starting Laughter

https://www.youtube.com/watch?v=kyY9TXE_u9k&feature=youtu.be

(10) – Antenna Laughter

https://www.youtube.com/watch?v=cp0pH6G8Rjs&feature=youtu.be

Further more videos will be published and this list will be updated from time to time.

The health benefits of ‘Laughter Yoga’ are described in our web page. This is based on the material published by Dr Madan Kataria in his famous web sitehttp://www.laughteryoga.org/

Our web page further gives further valuable information on the following topics:-

Stress & Depression On The Rise

Scientifically Proven Benefits of Laughter Yoga

5 Secrets of Laughter Yoga

Health Benefits of Laughter Yoga

Since I have personal experience, I can provide desired information to the interested person.

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DRT Solutions Weekly Mail – 354th Issue dated 20th February ’15

All Weekly mails right from 1st Issue to latest, click links on top of this page


 

(1) Over 2.5 Crore Cases Pending in Indian Courts 

 

The following news item is self explanatory:-

 

Over 2.5 crore cases pending in Indian courts: LS speaker

 

Ankur Tewari,TNN | Feb 14, 2015, 11.26 PM IST
http://timesofindia.indiatimes.com/india/Over-2-5-crore-cases-pending-in-Indian-courts-LS-speaker/articleshow/46247632.cms

AHMEDABAD: More than 2.5 crore cases are pending in courts across the country and this "unacceptable level" is due to lack of efficient lawyers, judges and courts, Lok Sabha speaker Sumitra Mahajan said on Saturday. 

Addressing the sixth convocation ceremony of Gujarat National Law University (GNLU), Mahajan said: "It's saddening that 63,800 cases are pending in Supreme Court, followed by 4.4 million in high courts and 20 million in district courts across the country. Justice delayed is justice denied. The majority of litigants in rural areas are struggling due to lack of courts, judges, efficient lawyers, infrastructure and lack of access to the justice delivery system." 

The speaker said: "To ensure cost-effective justice, the government must strengthen the setting up of legal aid and advise boards on mechanisms of alternative dispute resolutions like lok adalats, fast track courts and consumer forums." A total of 188 undergraduate and postgraduate students were awarded their degrees at the ceremony. 

16 DTH channels for distance learning 

Gujarat chief minister Anandiben Patel on Saturday announced that her government will soon start 16 DTH channels in schools and colleges for distance learning. 

"We want to promote distance learning in schools and colleges. So we've decided to launch 16 DTH channels soon," Patel said, addressing the convocation as the guest of honour.


 

(2) Supreme Court asks – Is Your Case in 93% or the Remaining 7%  

The following news item is self explanatory:-

Is your case in the 93% or the remaining 7%?


http://indianexpress.com/article/india/india-others/is-your-case-in-the-93-or-the-remaining-7/

Written by Utkarsh Anand | New Delhi | Posted: February 17, 2015 3:33 am

Of late, Justice Ranjan Gogoi has been starting court proceedings with a question that leaves many lawyers in the Supreme Court befuddled: “Does this case fall in the 93 per cent or in the remaining 7 per cent?”

While most lawyers don’t know how to respond, a few lucky ones get help from their colleagues who have been asked the same question by Justice Gogoi in the past.

During one such proceeding, senior advocate Kapil Sibal was left flummoxed when Justice Gogoi asked him, “Where does your case lie, Mr Sibal? We think it falls in the 93 per cent. You should withdraw it and go to the high court first.” Sensing Sibal’s confusion, senior advocate Shekhar Nephrade said he would help his friend understand what the judge was talking about.

Behind Justice Gogoi’s question is a research by a group of lawyers, who analysed 884 judgments delivered by the Supreme Court in 2014. As per the findings, only 7 per cent of these judgments involved substantial issues of laws and the Constitution, while the remaining 93 per cent of the cases related to appeals from miscellaneous orders of the high courts.

Supreme Court advocate K V Dhananjay and about one dozen lawyers in Delhi and Bangalore analysed the judgements, uploaded on the official website of the Supreme Court between January 1 and December 31, 2014. The purpose was to find out how many of these judgments involved interpretation of the Constitution or involved substantial challenge to any statute, regulation, law or executive action for being inconsistent or repugnant to a constitutional provision.

“The findings were mind-boggling since a meagre 64 cases, or 7 per cent of the total cases, involved any substantive constitutional issues. All other cases adjudicated upon by the Supreme Court were routine appeals from high courts,” Dhananjay told The Indian Express.

Explaining that the cases were segregated on the basis of whether they involved an inherent constitutional controversy or not, he said that the team tried its best to keep an objective view of the legal issues while examining whether a matter engaged the top court’s attention and time in deciding a major point of law or a simple question of fact.

Out of the 64 judgements dealing with significant legal and constitutional issues, exactly half were written by a two-judge bench, 18 were penned by a three-judge bench, and 14 were delivered by a five-judge Constitution bench. The analysis indicates that there has been a steady decline in the number of matters involving a substantial question of law decided by constitution benches comprising five or more judges.

According to the research, Justice A K Sikri was the sitting judge with the highest number of such judgments — seven. Former Chief Justices P Sathasivam and R M Lodha had each written nine judgments during 2014 before their retirements. A relatively young member of the bench who assumed the judicial office only in July last year, Justice Rohinton Nariman, wrote three such judgments in 2014.

Buoyed by the response the research has received from Justice Gogoi, Dhananjay said that he was planning to officially share this report with all Supreme Court judges who are the most burdened of any class of judges anywhere in the world. “They are increasingly carrying a tremendous burden with them and we must all be collectively grateful to them for their contribution to the cause of justice,” he added.

Recently, Justice T S Thakur, the most senior Supreme Court judge, said at a function that he had a job satisfaction of only 5 per cent. “If you ask me what is your job satisfaction after five years in SC, I will have to say only 5 per cent. I am unhappy 95 per cent of the time. Why? Because many cases reach the court, like Rs 4,000  cheque bounce cases and anticipatory bail matters, that shouldn’t reach this court. So many important matters that need attention remain unattended. Where do we have the time?” he said.

 

(3) Fraud in Medical Research

 

Dr V.P. Bansal, Indore has sent the following useful information:-

Fraud in Medical Research: “Out of Sight, Out of Mind, and Out of the Peer-Reviewed Literature”

http://chriskresser.com/behind-the-veil-conflicts-of-interest-and-fraud-in-medical-research

A large part of the subtitle above comes directly from a paper published in JAMA Internal Medicine, authored by Charles Seife. (1) In short, Seife discovered that clinical trial data determined to be fraudulent or mishandled by the FDA is rarely excluded from research studies published in scientific journals.

One of the FDA’s roles in the drug approval process is to inspect clinical trial sites to determine whether these sites are complying with FDA regulations. A typical inspection might involve auditing the records of the site, verifying that investigators adhered to the trial protocol, and comparing an investigator’s notes in hospital records with data reported to the study sponsor to ensure that there aren’t any discrepancies.

If there is a violation, the FDA classifies it in one of two ways: Voluntary action indicated (VAI) means the inspectors have found violations, but the problems aren’t serious enough to require sanction. Official action indicated (OAI) means that the inspectors have found violations significant enough to warrant official action.

Siefe and his assistants used the Freedom of Information Act to request information from the FDA, and supplemented that data with Google searches of the FDA database. They found 57 clinical trials that were directly linked to an OAI inspection.

The misconduct identified by the FDA in these cases included:

·         Falsification or submission of false information

·         Underreporting of adverse events

·         Failure to follow the investigational plan or other violations of protocol

·         Inadequate record keeping

·         Failure to protect the rights, safety, and welfare of patients

·         Use of experimental compounds in patients not enrolled in trials

·         Failure to supervise clinical investigations properly

The 57 trials Seife identified were in turn linked to 78 research articles published in the peer-reviewed scientific literature. 96 percent of these articles failed to mention the violations identified by the FDA inspection—despite the fact that in the majority of cases the inspection was completed at least 6 months before the article was published.

Doctors, researchers, and other health professionals rely on scientific studies to establish treatment protocols and public health policies. If the data in some of these studies are fraudulent, but the doctors and researchers have no way of knowing that, the decisions they make may be unsound and even put people at unnecessary risk.

I’d like to make the significance of these omissions even more clear by sharing a couple of examples mentioned in Seife’s paper.

One case involved a researcher who falsified lab test results to hide a patient’s impaired kidney and liver function in a trial comparing two chemotherapy regimens. The first dose of the regimen proved to be fatal to this patient, and the researcher was sentenced to 71 months in prison. Despite this episode being described in both FDA and court documents, not one of the studies in the peer-reviewed literature associated with the chemotherapy trial have any mention of the falsification, fraud, or homicide.

Another case involved a clinical site in China participating in a large trial of apixaban, an anticoagulant (i.e. anti-clotting) drug. The FDA determined that this trial site had altered patient records and falsified data. If the data from this site had been excluded, the mortality benefit for the drug would have disappeared. In other words, the “proof” that this drug saved lives was dependent on this fraudulent data. Yet none of this discussion appears in the scientific literature. In fact, studies since 2011 have consistently relied on the full data set (including the fraudulent data from the China trial site), and this was even true for an article published nearly 18 months after the fraud was discovered.

How can such egregious cases of fraud and misconduct go unreported in the scientific literature and in the media? The answer is almost hard to believe. The FDA does not notify journals when a site participating in a clinical trial receives an OAI inspection, nor does it typically make any announcement which would alert the media and general public to the issues it identified.

What’s more, the documents the FDA produces about these OAI inspections are heavily redacted, which makes it extremely difficult even for researchers like Seife who’ve invoked the Freedom of Information Act to determine which published clinical trials are tainted by misconduct. The FDA redacts these documents because it considers the identity of the drug company involved in the trial to be “confidential commercial information” that it is bound to protect.

In other words, the FDA appears to believe that it’s more important to protect private, commercial interests than it is to protect public health.

Seife’s says as much in the conclusion of his paper:

However, failing to notify the medical or scientific communities about allegations of serious research misconduct in clinical trials is incompatible with the FDA’s mission to protect the public health. Such allegations are relevant to include in the peer-reviewed literature on which physicians and other medical researchers rely to help them choose treatments that they offer to patients and other research participants.

The issues highlighted here raise serious concerns not only about the trustworthiness of the data in clinical trials and published research, but the reliability and motives of the agencies tasked with protecting public health.

Which takes us to the second reason that public mistrust of scientific research is sometimes well-founded: conflicts of interest.

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DRT Solutions Weekly Mail – 353rd Issue dated 13th February ’15

All Weekly mails right from 1st Issue to latest, click links on top of this page


 

(1) Rs 2-lac-crore Cases Pending with DRTs in 2014  

 

The following news item is self explanatory:-

Rs 2-lakh-cr cases pending with DRTs in FY14

http://www.financialexpress.com/article/industry/companies/rs-2-lakh-cr-cases-pending-with-drts-in-fy14/22159/

Even as bankers rely on debt recovery tribunals (DRTs) as a legal alternative to recover bad loans, they feel the process is too long and not very effective, reports fe Bureau from Mumbai. According to RBI data, cases of loans of over Rs 2 lakh crore were pending at 33 tribunals till FY14 end, up from Rs 1.43 lakh crore in FY13.

IDBI Bank executive director RK Bansal says DRTs are burdened with cases and, thus, their effectiveness is lower than expected. He said even if a case is resolved, the DRT issues recovery certificates which takes nearly a year to locate the borrower’s assets and find a borrower. “It takes a year from the date of resolution for the bank to recover the dues,” Bansal added.

                                                                                          FY 13         FY  14

Value of cases pending at DRTs (Rs crore) –   1,43,000      2,06,010

Loans sold to ARCs (Rs crore)                    -               360         15,470

Gross NPA ration (%)                                                       3.4               4.1

Net NPA ratio (%)                                                              1.7              2.2

Restructured advances to gross advances(%)         5.8              5.9

(Source – RBI, finance ministry)

RBI governor Raghuram Rajan had recently said the amount recovered from cases decided in 2013-14 was Rs 30,590 crore, while the value of loans to be recovered was Rs 2.36 lakh crore. Thus, only 13% of the outstanding NPAs in the tribunals were recovered in FY14. According to Rajan, even though the law says that cases before the DRT should be disposed off within 6 months, only about a-fourth of the cases pending at the start of the year are disposed off during the year — suggesting a four-year wait even if the tribunals focus only on old cases.

Bankers also say that the tribunals have also been giving too much leeway to borrowers who seek regular adjournments. SBI deputy managing director (stressed assets management) PK Malhotra told FE last month that apart from the DRTs being saddled with too many cases, borrowers start playing the judicial system by seeking more and more dates. “So DRTs have not delivered to the extent that the financial system had expected them to deliver,” Malhotra had said.

 

(2) India aims to Amend Arbitration Law to Lure Foreign Investors  

 

The following news item is self explanatory:-

India aims to amend arbitration law to lure foreign investors

BY MANOJ KUMAR

NEW DELHI Tue Feb 10, 2015 4:01pm IST

http://in.reuters.com/article/2015/02/10/india-arbitration-idINKBN0LE0YQ20150210

(Reuters) - India plans to amend its arbitration law, setting time limits for courts and easing judicial rules to decide corporate disputes, as it seeks to attract more foreign investment, Law Minister Sadananda Gowda said on Tuesday.

Many domestic and foreign companies, such as British telecoms major Vodafone (VOD.L), prefer Singapore, Hong Kong and London as arbitration venues, since winning final settlements from Indian courts can take years.

The World Bank rates India 186th out of 189 countries for its enforcement of contracts. Prime Minister Narendra Modi has promised judicial reforms and other steps to lift India up the World Bank's Doing Business Index.

"Billions of dollars are blocked in legal disputes in India," Gowda told an industry event. "There is a need to establish a speedy, cost-effective and efficient disputes resolution mechanism."

Parliament was expected to approve amendments to the arbitration law in the coming session, he added, which would help attract more investment and settle disputes.

The next parliament session begins on Feb. 23, with Finance Minister Arun Jaitley due to present his budget for the fiscal year ending in March 2016.

The government also plans to set up separate commercial courts to speed the resolution of corporate disputes, a move that could unlock billions of dollars in investments, Gowda said.

A government panel has suggested limiting courts' authority to overrule arbitration awards and fixing time limits and fees to settle legal cases.

The government earlier deferred plans to issue an executive order to amend the law, as it wanted parliamentary approval, Gowda said.

Sums ranging in the billions of dollars are leaving India every year in arbitration costs headed overseas, industry chamber ASSOCHAM said in a report, with Singapore the most popular site for arbitration cases filed by Indians.

Scores of projects worth more than 4 trillion rupees ($64 billion) are under litigation in different courts and tribunals, the report said.

"Delay in the timely disposal of high-value cases is leading to a drop in GDP," said D.S. Rawat, secretary general of ASSOCHAM. "If it could be tackled, it would expand economic activity and provide more avenues for jobs."

($1=62.0500 rupees)

(Reporting by Manoj Kumar; Editing by Clarence Fernandez)

(3) Four Yoga Postures to Beat Bad Mood  

 

Mr U.C. Desai, Ahemdabad has sent the following useful information:-

 

Four  yoga poses to beat a bad mood

 

We might want to indulge in mood-lifting foods after a bad day at work, instead try these yoga poses to lift our spirits.

1. Wheel pose: Often when you're in a bad mood, you just need to take deep breaths to supply enough oxygen to your body. This pose involves bending backwards, that can energise you. Lie flat on the ground and bend your knees. Place your palms on the floor behind your head. Now, putting pressure on your feet and palms, lift your lower and upper body to form a semi-circular wheel.

2. Headstand: This pose flips a switch in the brain, letting the blood flow in to the head. Lie on your stomach with your elbows next to your head, touching the floor. Slowly curl up and lift your back and feet off the ground. Shift the weight to your elbows and your crown, until you are perpendicular to the ground. Take support of the wall for balance.

3. Crow pose: This pose can help you gain confidence and break your pattern of negative thinking. Squat in a frog pose and then bend forward, placing your palms on the floor. Place your knees on the back of your upper arms and lift your feet off the floor, shifting pressure on your palms.

4. Forward bend: This pose will stretch your body muscles, relaxing you. Stand with your feet wide apart. Inhale and stretch your arms overhead. Exhale as you bend forward from your hips. Bend a little at your knees, if need be, and try touching your heels with your palms
  From U.C.Desai (Arogyaganga) Ahmedabad (M) 09374556625 

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DRT Solutions Weekly Mail – 352nd Issue dated 6th February ’15

All Weekly mails right from 1st Issue to latest, click links on top of this page

(1) CMM (Chief Metropolitan Magistrate, Esplanade) Mumbai Rejected Application of Bank u/s 14 of SARFASI Act  

Mr Haresh Gandhi, one of our clients from Mumbai has sent copy of the order dated 12.01.15 from the said Magistrate in case no 354/SA/2014 rejecting the application of the Bank u/s 14 of the SARFAESI Act for taking physical possession. The said Magistrate has held that the Citi Financial Consumer Finance India Ltd the assignor of the Bank is not registered as Financial Company.

(2) Arbitration Agreement vis-à-vis Jurisdiction of Specialized Tribunals 

The following article is self explanatory:- 

India: Effect Of Arbitration Agreement Vis A Vis The Jurisdiction Of Specialised Tribunals

http://www.mondaq.com/india/x/368918/Arbitration+Dispute+Resolution/Effect+Of+Arbitration+Agreement+Vis+A+Vis+The+Jurisdiction+Of+Specialised+Tribunals

The question of jurisdiction of specialized tribunals over the disputes arising out of the agreement where the parties thereto have agreed for arbitration as their dispute resolution mechanism has been in much debate and interpreted by various courts on various occasions. To understand the arbitration and the intent of the legislature for such enactment, one can refer to the preamble of the Act. The preamble of the Arbitration Act, 1996 reads as follows:

"An Act to consolidate and amend the law relating to domestic arbitration, international commercial arbitration and enforcement of foreign arbitral awards as also to define the law relating to conciliation and for matters connected therewith or incidental thereto.

WHEREAS the United Nations Commission on International Trade Law (UNCITRAL) has adopted the UNCITRAL Model Law on International Commercial Arbitration in 1985:

AND WHEREAS the General Assembly of the United Nations has recommended that all countries give due consideration to the said Model Law, in view of the desirability of uniformity of the law of arbitral procedures and the specific needs of international commercial arbitration practice;

AND WHEREAS the UNCITRAL has adopted the UNCITRAL Conciliation Rules in 1980;

AND WHEREAS the General Assembly of the United Nations has recommended the use of the said Rules in cases where a dispute arises in the context of international commercial relations and the parties seek an amicable settlement of that dispute by recourse to conciliation;

AND WHEREAS the said Model Law and Rules make significant contribution to the establishment of a unified legal framework for the fair and efficient settlement of disputes arising in international commercial relations;

AND WHEREAS it is expedient to make law respecting arbitration and conciliation, taking into account the aforesaid Model Law and Rules;"

Arbitration is an alternate dispute resolution mechanism incorporated to have a speedy and out of court fair and efficient settlement of disputes arising in international commercial relations where the parties to the transaction seek an amicable settlement of that dispute by recourse to conciliation.

The preamble itself suggests that Arbitration is a right in personam which binds two parties agreeing to opt for such mechanism for dispute resolution. According to Black's Law Dictionary, Arbitration is a method of dispute resolution involving one or more neutral third parties.

Alternatively, for certain disputes arising between the parties covered and governed by special enactments, there are special courts/tribunals constituted under such enactments where the parties can approach in case of disputes arisen between them. The examples of the same would be Debt Recovery Tribunal constituted under the provisions of The Recovery of Debts Due to banks and Financial institutions Act, 1993, Central Administrative Tribunal and State Administrative Tribunals constituted under the Administrative Tribunals Act, 1985 to deal with the Service matters of the civil servants and employees of public bodies/ authorities, Armed Forces Tribunal constituted under the Armed Forces Tribunal Act, 2007 to decide the disputes of defence personnel etc. It would be pertinent to mention here that such enactments generally have the exclusion jurisdiction set out with a notwithstanding clause mentioned in such acts. Such enactments set out the exclusivity of the disputes governed by such acts to be dela6 with the specialized forums constituted to decide on such disputes.

In the present article we deal with the arbitrability of disputes arisen amongst the banks and the borrowers in the light of the Judgments of the Full Bench of the Hon'ble Delhi High Court in HDFC Bank v. Satpal Singh Bakshi, as to whether the remedy of arbitration stands excluded in cases where specific tribunals are set up to decide the disputes between the same parties, more particularly in view of the exclusion of jurisdiction clauses set out in such acts. Or in other words; which of the two enactments, i.e. Arbitration Act and The Recovery of Debts Due to Banks and Financial Institutions Act (hereinafter referred to as the 'Debt Recovery Act') is to prevail over the other.

The Full Bench of the Hon'ble Delhi High Court in HDFC Bank v. Satpal Singh Bakshi while inter alia deciding the issue stated above set out a distinction between what is arbitrable and what is not arbitrable in the light of Right in rem and right in personam. Right in rem means a right, often negative, exercisable against the world at large1. Whereas, Right in personam; means an interest protected solely against specific individuals2.

During the course of hearing of the said Judgment, the counsel representing bank inter alia referred to a judgment of Division Bench of Hon'ble Delhi High Court in Kohinoor Creations and Ors. Vs. Syndicate Bank 2005 (2) ARBLR 324 Delhi; wherein it has been inter alia held that in view of the provisions of section 34 of the Debt Recovery Act, the provisions of the Arbitration Act stand excluded. In coming to this conclusion, specific emphasis was laid on sub-section (2) of Section 34 of the RDB Act. Section 34 of the RDB Act reads as under:-

"34. Act to have over-riding effect-

(1) Save as otherwise provided in sub-section(2), the provisions of this Act shall have effect notwithstanding anything inconsistent therewith contained in any other law for the time being in force or in any instrument having effect by virtue of any law other than this Act.

(2) The provisions of this Act or the rules made there under shall be in addition to, and not in derogation of the IndustrialFinance Corporation Act, 1948, the State Financial Corporation Act, 1951, the Unit Trust of India Act, 1963, the Industrial Reconstruction Bank of India Ltd., 1984, the Sick Industrial Companies (Special Provisions) Act, 1985 and the Small Industries Development Bank of India Act, 1989."

The counsel representing bank further contended that Section 17 of the Recovery of Debts Due to banks and Financial institutions Act, 1993 (the Act) makes it clear that the Debt Recovery Tribunal (DRT) alone is to decide the applications of the Banks and Financial Institutions for recovery of debts due to them. Also, Section 18 of the Act clearly bars the jurisdiction of any other court, except High Court and Supreme Court, from entertaining matters specified in Section 17. Furthermore, Section 31 of the Act transfers all such cases pending before any Court to the DRT. It is therefore evident from the scheme of the RDB that an exclusive jurisdiction has been given to the DRT. He argued that the law on this point has already been conclusively settled by the Supreme Court in the matter of Allahabad Bank v. Canara Bank, (2000) 4 SCC 406, where the issue was with regard to jurisdiction of DRT and Recovery Officers under the DRT Act vis-a- vis Company Court (when a winding up petition is pending, or a winding up order has been passed). It was held that the adjudication of liability and execution of the certificate in respect of debt payable to banks and financial institutions is within the exclusive jurisdiction of the DRT and the concerned Recovery Officer, and in such a case the jurisdiction of the Company Court under Section 442, 537 and 446 of the Companies Act, 1956 stands ousted. He stated that on the other hand, the Arbitration Act is a substitute for a civil Court within the meaning of Section 9 to adjudicate civil disputes, subject to the additional limitation where it is a right in rem, which is to be adjudicated. Taking sustenance from the judgment of Supreme Court in the matter of Booz Allen and Hamilton Inc. v. SBI Home Finance Limited & Ors., (2011) 5 SCC 532, he pointed out that the Supreme Court while dealing with the issue of "arbitrability" of dispute held that Arbitral Tribunals are "private for a" chosen by the parties in place of Courts or Tribunals which are "public for a" constituted under the laws of the country. All disputes relating to "right in personam" are considered to be amenable to arbitration and all disputes relating to "right in rem" are required to be adjudicated by courts and public tribunals, being unsuited for private arbitration. He attempted to apply the ratio of the aforesaid judgment to the given case arguing that when the legislature has expressly made a particular kind of dispute to be decided by a public forum, then the same has been by implication excluded from the purview of arbitrability and therefore cannot be decided by a private forum like arbitration.

The Counsel representing the Bank also tried to draw support from Section 34 of the Act which provides a non-obstante clause. Section 34(2) stipulates that the Act is "in addition to and not in derogation" to any law or force. On the contrary, the Arbitration Act does not have any non- obstante clause except a limited extent insofar as judicial intervention is concerned as provided in Section 5 of the Arbitration Act. He thus submitted that where there are two Acts, the one having a nonobstante clause will prevail over the other and for this reason also, the Act should prevail over Arbitration Act. He also submitted that a finer reading of the provisions of the Act, particularly Section 34 thereof, would reveal that application of Arbitration Act had been expressly as well as impliedly excluded. He also submitted that even if the Arbitration Act is a latter Act, the concept of arbitration was well known to Parliament right from Arbitration Act, 1891 through to the Arbitration Act, 1940. Apart from Section 34, even Section 18 of the Act ousts jurisdiction of all other courts in relation to matters specified in Section 17. Since arbitration is an alternative to the jurisdiction of civil courts and its jurisdiction would be confined and in alternative to cases where civil courts have jurisdiction, therefore, when the jurisdiction of civil courts are ousted, it would impliedly oust the jurisdiction of the arbitral tribunal also. It is Section 18 which is somewhat in pari materia with Section 5 of the Arbitration Act. The Ld. Counsel concluded his submissions by referring to the judgment of the Supreme Court in Nahar Industrial Enterprise Ltd. v. Hong Kong and Shanghai Banking Corporation, (2009) 8 SCC 646 and submitted that the issue at hand stands settled by the aforesaid judgment. In that case, the issue was whether the High Court or Supreme Court has the power to transfer a suit pending in a Civil Court to DRT. The Court enunciated the law as under:

"117. The Act, although, was enacted for a specific purpose but having regard to the exclusion of jurisdiction expressly provided for in Sections 17 and 18 of the Act, it is difficult to hold that a civil court's jurisdiction is completely ousted. Indisputably the banks and the financial institutions for the purpose of enforcement of their claim for a sum below Rs. 10 lakhs would have to file civil suits before the civil courts. It is only for the claims of the banks and the financial institutions above the aforementioned sum that they have to approach the Debt Recovery Tribunal. It is also without any cavil that the banks and the financial institutions, keeping in view the provisions of Sections 17 and 18 of the Act, are necessarily required to file their claim petitions before the Tribunal. The converse is not true. Debtors can file their claims of set off or counter-claims only when a claim application is filed and not otherwise. Even in a given situation the banks and/or the financial institutions can ask the Tribunal to pass an appropriate order for getting the claims of setoff or the counter claims, determined by a civil court. The Tribunal is not a high powered tribunal. It is a one man Tribunal. Unlike some Special Acts, as for example Andhra Pradesh Land Grabbing (Prohibition) Act, 1982 it does not contain a deeming provision that the Tribunal would be deemed to be a civil court."

Upon submission of the counsel of the bank the Full bench of the Hon'ble Delkhi High Court observed as under:

There is no doubt that those matters which are covered by the Act and are to be adjudicated upon by the Debt Recovery Tribunal/ Debt Recovery Appellate Tribunal, jurisdiction of civil courts is barred. Up to this point, we are in agreement with the learned counsel. However, the answer to the question posed before us does not depend upon the aforesaid principle. That principle only ousts the jurisdiction of civil courts. Focus of the issue, however, has to be somewhat different viz. even when a special Tribunal is created to decide the claims of banks and financial institutions of amounts more than `10 Lakhs, can the parties by mutual agreement still agree that instead of the Tribunal constituted under the Act, these disputes shall be decided by the Arbitral Tribunal. If answer to this question is in the negative, then those submissions made by the counsels shall prevail. On the other hand, if we find that it is permissible for the parties, by agreement, to agree for domestic forum of their own choice, namely, Arbitral Tribunal under the Arbitration Act to deal with such claims, then the edifice of the apparent forceful submissions of the Ld. Counsel would collapse like house of cards as all those submissions would be relegated to the pale of insignificance.

No doubt, for determination of disputes the State provides the mechanism in the form of judicial fora, i.e. administration of justice through the means of judicial system established in this country as per the Constitution and the laws. However, it is also recognized that that is not the only means for determination of suit or resolution of conflicts between the parties. Still the parties are given freedom to choose a forum, alternate to and in place of the regular courts or judicial system for the decision of their inter se disputes. There has been a recognition of the concept that notwithstanding the judicial system, parties are free to chose their own forum in the form of arbitration. This was first recognized by enacting Arbitration Act, 1891.

Introduction of Section 89 in the Code of Civil Procedure by amendment to the said Code in the year 2002 takes this concept further by introducing various other forums, known as Alternate Dispute Resolution. Thus, even when the matter is pending in the Court, parties to the dispute are given freedom to resort to Lok Adalat, conciliation, mediation and also the arbitration.

All civil societies demand a proper, effective and independent judicial system to resolve the disputes that may arise. Resolution of disputes by Municipal Courts is, therefore, prevalent in all countries and independence of judiciary is endeavoured in democratic set ups. While courts are State machinery discharging sovereign function of judicial decision making, various alternate methods for resolving the disputes have also been evolved over a period of time. One of the oldest among these is the arbitration. This is a forum for dispute resolution in place of municipal court. Important feature of arbitration is that parties to the dispute voluntarily agree to get the disputes decided by one or more persons, rather than the Court. Though the Indian Arbitration and Conciliation Act, 1996 does not contain a definition of "arbitration", Statement of Objects and Reasons contained therein gives an indication of the general principles on which arbitration is founded. These are:

bullet

The object of arbitration is to ensure a fair resolution of disputes by an impartial tribunal without unnecessary delay or expense.

bullet

The parties should be free to agree how their disputes are resolved subject only to such safeguards as are necessary in the public interest.

bullet

Intervention of the courts should be restricted.

Thus, the Courts have not been the only forum for conflict resolutions. As already pointed about above, arbitration in the form of statute was given recognition in the year 1899 though even earlier to that, arbitration in some or other form prevailed in this country. What is important is that arbitration as an alternate to resolution by municipal courts is recognized and in the process, sanctity is attached to the domestic forum which is chosen by the parties themselves. In that sense, party autonomy is recognized as paramount. It is a recognition of the fact that the parties are given freedom to agree how their disputes are resolved. Even the intervention by the Courts is restricted and is minimal.

11. What follows from the above? When arbitration as alternate to the civil courts is recognized, which is the common case of the parties before us, creation of Debt Recovery Tribunal under the RDB Act as a forum for deciding claims of banks and financial institutions would make any difference? We are of the firm view that answer has to be in the negative. What is so special under the RDB Act? It is nothing but creating a tribunal to decide certain specific types of cases which were earlier decided by the civil courts and is popularly known as tribunalization of justice‟. It is a matter of record that there are so many such tribunals created. Service matters of the civil servants and employees of public bodies/authorities which were hitherto dealt with by the civil courts and the High Court are now given to the Central Administrative Tribunal and State Administrative Tribunals with the enactment of Administrative Tribunals Act, 1985. Disputes of defence personnel are now dealt with by special tribunals called Armed Forces Tribunal constituted under the Armed Forces Tribunal Act, 2007. With the creation of all these special tribunals, the matters which were up to now dealt with by civil courts or High Courts are to be taken up by these tribunals in the first instance. (We would like to point out that in so far as High Court is concerned, constitutional remedy provided under Article 226 of the Constitution of India remains intact as held in L. Chandrakumar v. Union of India, (1994) 5 SCC 539. However, it is not necessary to dilate on this issue as that does not have any bearing on the present issue).

With the creation of these alternate fora with all trappings of the Court and with the decision of the disputes which were hitherto dealt with by the civil courts, can it be said that parties are now totally precluded and prohibited of exercising their choice of domestic forum in the form of arbitral tribunal. Before we answer this question, we would like to refer to the judgment in the case of Booz Allen and Hamilton Inc. (supra). The Supreme Court in that case dealt with the issue of "arbitrability of disputes" and held that all disputes relating to right in personam‟ are considered to be amenable to arbitration and disputes relating to right in rem‟ are those disputes which are not arbitrable and require to be adjudicated by courts and public tribunals, being unsuited for private arbitration. Law in this respect is explained by the Supreme Court with utmost clarity, precision and erudition in the following terms:

The nature and scope of issues arising for consideration in an application under Section 11 of the Act for appointment of arbitrators, are far narrower than those arising in an application under Section 8 of the Act, seeking reference of the parties to a suit to arbitration. While considering an application under Section 11 of the Act, the Chief Justice or his designate would not embark upon an examination of the issue of 'arbitrability' or appropriateness of adjudication by a private forum, once he finds that there was an arbitration agreement between or among the parties, and would leave the issue of arbitrability for the decision of the arbitral Tribunal. If the arbitrator wrongly holds that the dispute is arbitrable, the aggrieved party will have to challenge the award by filing an application under Section 34 of the Act, relying upon Sub-Section 2(b)(i) of that section.

But where the issue of 'arbitrability' arises in the context of an application under Section 8 of the Act in a pending suit, all aspects of arbitrability have to be decided by the court seized of the suit, and cannot be left to the decision of the Arbitrator. Even if there is an arbitration agreement between the parties, and even if the dispute is covered by the arbitration agreement, the court where the civil suit is pending, will refuse an application under Section 8 of the Act, to refer the parties to arbitration, if the subject matter of the suit is capable of adjudication only by a public forum or the relief claimed can only be granted by a special court or Tribunal.

The term 'arbitrability' has different meanings in different contexts. The three facets of arbitrability, relating to the jurisdiction of the arbitral tribunal, are as under:

bullet

whether the disputes are capable of adjudication and settlement by arbitration? That is, whether the disputes, having regard to their nature, could be resolved by a private forum chosen by the parties (the arbitral tribunal) or whether they would exclusively fall within the domain of public fora (courts).

bullet

Whether the disputes are covered by the arbitration agreement? That is, whether the disputes are enumerated or described in the arbitration agreement as matters to be decided by arbitration or whether the disputes fall under the 'excepted matters' excluded from the purview of the arbitration agreement.

bullet

Whether the parties have referred the disputes to arbitration? That is, whether the disputes fall under the scope of the submission to the arbitral tribunal, or whether they do not arise out of the statement of claim and the counter claim filed before the arbitral tribunal. A dispute, even if it is capable of being decided by arbitration and falling within the scope of arbitration agreement, will not be 'arbitrable' if it is not enumerated in the joint list of disputes referred to arbitration, or in the absence of such joint list of disputes, does not form part of the disputes raised in the pleadings before the arbitral tribunal.

Arbitral tribunals are private fora chosen voluntarily by the parties to the dispute, to adjudicate their disputes in place of courts and tribunals which are public fora constituted under the laws of the country. Every civil or commercial dispute, either contractual or noncontractual, which can be decided by a court, is in principle capable of being adjudicated and resolved by arbitration unless the jurisdiction of arbitral tribunals is excluded either expressly or by necessary implication. Adjudication of certain categories of proceedings are reserved by the Legislature exclusively for public fora as a matter of public policy. Certain other categories of cases, though not expressly reserved for adjudication by a public fora (courts and Tribunals), may by necessary implication stand excluded from the purview of private fora. Consequently, where the cause/dispute is inarbitrable, the court where a suit is pending, will refuse to refer the parties to arbitration, under Section 8 of the Act, even if the parties might have agreed upon arbitration as the forum for settlement of such disputes.

The well recognized examples of non-arbitrable disputes are: (i) disputes relating to rights and liabilities which give rise to or arise out of criminal offences; (ii) matrimonial disputes relating to divorce, judicial separation, restitution of conjugal rights, child custody; (iii) guardianship matters; (iv) insolvency and winding up matters; (v) testamentary matters (grant of probate, letters of administration and succession certificate); and (vi) eviction or tenancy matters governed by special statutes where the tenant enjoys statutory protection against eviction and only the specified courts are conferred jurisdiction to grant eviction or decide the disputes.

It may be noticed that the cases referred to above relate to actions in rem. A right in rem is a right exercisable against the world at large, as contrasted from a right in personam which is an interest protected solely against specific individuals. Actions in personam refer to actions determining the rights and interests of the parties themselves in the subject matter of the case, whereas actions in rem refer to actions determining the title to property and the rights of the parties, not merely among themselves but also against all persons at any time claiming an interest in that property. Correspondingly, judgment in personam refers to a judgment against a person as distinguished from a judgment against a thing, right or status and judgment in rem refers to a judgment that determines the status or condition of property which operates directly on the property itself. (Vide: Black's Law Dictionary).

Generally and traditionally all disputes relating to rights in personam are considered to be amenable to arbitration; and all disputes relating to rights in rem are required to be adjudicated by courts and public tribunals, being unsuited for private arbitration. This is not however a rigid or inflexible rule. Disputes relating to sub-ordinate rights in personam arising from rights in rem have always been considered to be arbitrable."

What is discernible from the above is that all disputes relating to "right in personam" are arbitrable and choice is given to the parties to choose this alternate forum. On the other hand, those relating to "right in rem" having inherent public interest are not arbitrable and the parties‟ choice to choose forum of arbitration is ousted. Examined in this line, it is obvious that a claim of money by the bank or financial institution against the borrower cannot be treated as "right in rem". Each claim involves adjudication whether, on the facts of that case, money is payable by the borrower to the bank/financial institution and if so to what extent. Each case is the decision on the facts of that case with no general ramifications. A judgment/decision of the Debt Recovery Tribunal deciding a particular claim can never be "right in rem" and is a "right in personam" as it decides the individual case/claim before it with no elements of any public interest.

Merely because there were huge NPAs and lot of monies belonging to the banks and financial institutions was stuck up and the legislature in its wisdom decided to create a special forum to have expeditious disposal of these cases would not mean that decisions rendered by Debt Recovery Tribunal come in the realm of right in rem‟. At the same time, we find from the judgment in Booz Allen and Hamilton Inc. (supra) that certain kinds of disputes for which tribunals are created are held to be non- arbitrable. Examples are Rent Control Tribunal under the Rent Control Act and Labour Court/Industrial Tribunal under the Industrial Disputes Act, 1947. Obviously, question that would immediately strike is as to what would be the yardstick to determine some kind of disputes to be decided by the tribunals are non-arbitrable whereas some other disputes become arbitrable. According to us, cases where a particular enactment creates special rights and obligations and gives special powers to the tribunals which are not with the civil courts, those disputes would be non-arbitrable.

It is a matter of common knowledge that Rent Control Act grants statutory protection to the tenants. Wherever provisions of Rent Control Act are applicable, it overrides the contract entered into between the parties. It is the rights created under the Act which prevail and those rights are not enforceable through civil courts but only through the tribunals which is given special jurisdiction not available with the civil courts. Likewise, Industrial Disputes Act, 1947 creates special rights in favour of the workman or employers and gives special powers to the industrial adjudicators/ tribunals to even create rights which powers are not available to civil courts. Obviously such disputes cannot be decided by means of arbitral tribunals which are substitute of civil courts. On the other hand, in so far as tribunal like Debt Recovery Tribunal is concerned, it is simply a replacement of civil court. There are no special rights created in favour of the banks or financial institutions. There are no special powers given to the Debt Recovery Tribunal except that the procedure for deciding the disputes is little different from that of CPC applicable to civil courts. Otherwise, the Debt Recovery Tribunal is supposed to apply the same law as applied by the civil courts in deciding the dispute coming before it and is enforcing contractual rights of the Banks. It is, therefore, only a shift of forum from civil court to the tribunal for speedy disposal. Therefore, applying the principle contained in Booz Allen and Hamilton Inc. (supra), we are of the view that the matters which come within the scope and jurisdiction of Debt Recovery Tribunal are arbitrable.

Once that conclusion is arrived at, obviously the parties are given a choice to chose their own private forum in the form of arbitration.

Another significant fact which has to be highlighted is that the bank entered into agreement with the respondent herein on its own standard form formats. The terms and conditions of the loan were set out and decided by the bank. The respondent signed on dotted lines. In this scenario, when it was the proposal of the bank to have an arbitration clause to which the respondent had agreed, bank cannot now be permitted to say that this arbitration clause is of no consequence. Accepting the contention of bank would mean that the arbitration clause is rendered nugatory. It defeats the very effect of the said arbitration clause which was foisted by the bank itself upon the respondent, though in law, it becomes mutually acceptable between the parties.

Matter can be looked into form another angle as well. Had the bank invoked the arbitration on the basis of aforesaid clause containing arbitration agreement between the parties and referred the matter to the arbitral tribunal, was it permissible for the respondent to take an objection to the maintainability of those arbitration proceedings? Answer would be an emphatic no. When we find that answer is in the negative, the Court cannot permit a situation where such an arbitration agreement becomes one sided agreement, namely, to be invoked by the bank alone at its discretion without giving any corresponding right to the respondent to have the benefit thereof.

Conclusion

In the light of the above it may be understood that the disputes whish are in the nature of right in presonam i.e. amongst the parties to the agreement wherein the terms are stipulated and binds those parties, the dispute resolution will be in accordance with the dispute resolution mechanism agreed into amongst the parties thereto. The difference between the right in rem and right in personam is to be understood while adjudicating the exclusivity of the forum to decide certain matters like in arbitration, if the tests specified above are clear, and its is ascertained that the dispute is arbitrable, the same shall be exclusively referred to the arbitral tribunal.

Footnotes

1. Black's Law Dictionary

2. Black's Law Dictionary

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

Contributor

Karan Gandhihttp://www.mondaq.com/images/blank.png

Singh & Associates

 

(3) How To Be Happy 

Mr Firoz Poonawalla has sent the following useful information:- 

Generally, when a person makes a mistake, he would look around to find a scapegoat to point the finger at.

We should always remember that when we point one finger at a person, the other four fingers are pointing at ourselves. 

A man asked his father-in-law, "Many people praise you for a successful marriage. Could you please share with me your secret?"

The father-in-law answered in a smile, "Never criticize your wife for her shortcomings or when she does something wrong. Always bear in mind that because of her shortcomings and weaknesses, she could not find a better husband than you." 

If we forgive the others, others will ignore our mistake too. 

The first recipe for happiness is: avoid too lengthy meditation on the past.

To settle an argument, think of what is right, not who is right.

Christmas is not a time nor a season, but a state of mind.
To cherish peace and goodwill, to be plenteous in mercy, is to have the real spirit of Christmas.

There will always be factors and people that we cannot control;

how we respond can determine the quality of our lives.

When winning revolves around material acquisitions, one loses sight of the spiritual purpose of being alive.

Courageous people are generally honest people, for honesty is the foundation of courage.

When I focus on the money lost, I lose time that I could be using to create more avenues of exchange to earn it back.

Sometimes a short walk down memory lane is all it takes to appreciate where you are today.

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DRT Solutions Weekly Mail – 351st Issue dated 30th January ’15

All Weekly mails right from 1st Issue to latest, click links on top of this page

(1) Important & Useful Judgment for Borrowers – Sec 14 – SARFAESI Act – Physical Possession Can Not be Taken without Court Order

 

The following extracts from the Judgment (emphasis through portion marked Red) are very useful to the borrowers and guarantors. The entire judgment with comments will be published on our web site on 31st instt :-

IN THE HIGH COURT OF JUDICATURE AT BOMBAY

CRIMINAL APPELLATE JURISDICTION

CRIMINAL WRIT PETITION NO.4484 of 2013

Milind Kashinath Mahadik .. Petitioner

Versus

The State of Maharashtra & ors .. Respondents

Mrs. Aarti Mahadik and Mr.Milind Mahadik, Petitioner in person present.

Mr.R. Sathyanarayanan i/b M/s.H & M Legal Associates for respondent no.3 – Housing Development Finance Corporation Ltd (HDFC Ltd)

Mr.Deepak Thakre, APP for the Respondent No.1 State.

CORAM : ABHAY M. THIPSAY, J.

DATED : 11th DECEMBER 2014.

ORAL

ORDER:1

Rule. By consent, Rule made returnable forthwith.

2 By consent, heard finally forthwith.

3 The petitioner had filed a complaint against the respondent nos. 2,3 and 4 herein, alleging commission of various offences, including the offences punishable under section 406 IPC, 409 IPC, 420 IPC, 448 IPC, 504 IPC read with section 34 of the IPC, in the Court of Judicial Magistrate First Class at Pune. The learned Magistrate after examining the petitioner on oath, postponed the issue of process, and ordered investigation into the matter by the police, as contemplated under section 202 of the Code of Criminal Procedure (for short 'the Code'). After receipt of the report of investigation, the learned Magistrate came to the conclusion that there were not sufficient grounds for proceeding, and therefore, by an order dated 3rd October 2011, dismissed the complaint, as contemplated under section 203 of the Code. The petitioner challenged the order of dismissal of the complaint by filing an application for revision in the Court of Sessions. The learned Addl. Sessions Judge, who heard the revision application, found nothing wrong in the order passed by the Magistrate, and therefore, rejected the revision application. It is under these circumstances, that the applicant has, by the present petition under Article 227 of the Constitution of India, approached this Court, and is also invoking the inherent powers of the Court, praying that the order passed by the learned Addl. Sessions Judge in revision, be quashed and set aside, and that process be ordered to be issued with respect to the offences mentioned in the complaint 'against the respondent Bank'.

4 In this Court, the petitioner desired to be represented by his wife – Smt.Aarti Mahadik and as such, the wife of the petitioner Smt.Aarti Mahadik was permitted to address the Court by making submissions in support of the petition.

5 I have heard the petitioner's wife for and on behalf of the petitioner. I have heard Mr. R.Sathyanarayanan, learned counsel for the respondent nos.2 and 3. I have heard Mr.Deepak Thakre, learned APP for the State.

16 In this regard, the complainant has placed reliance on certain observations made by this Court in Clarity Gold Pvt.Ltd and Anr Vs. State Bank of India & ors, AIR 2011 Bom 42. It would be proper to reproduce the observations made by the learned Single Judge in paragraph no.19 of the judgment in the said case.

“Section 14 of the Act is an enabling provision under which the secured creditor is empowered to seek recourse to the Chief Metropolitan Magistrate or, as the case may be, the District Magistrate for the purpose of taking possession. Though Section 14 is an enabling provision, it will be wholly impermissible for a secured creditor, despite the provisions of Section 14, to take the law into his own hands and to forcibly evict a borrower from the secured asset. Our legal system is governed by the rule of law. If the borrower hands over possession voluntarily to the secured creditor in pursuance of a notice under Section 13(4), it would be open to the secured creditor to take possession. But, if possession is not voluntarily handed over, the secured creditor cannot take the law into his own hands and secure vacant possession by taking recourse to the police machinery. In such an event, the only remedy that is available is to seek an appropriate order from the Chief Metropolitan Magistrate, or as the case may be, the District Magistrate. Parliament has specifically authorized in subsection (2) those authorities to take or cause to be taken such steps and use or caused to be used such force as may be necessary. Authorization of the use of force for taking possession is therefore, a matter which lies in the jurisdiction and power of the authorities prescribed by Section 14. No secured creditor can, by seeking assistance of police machinery unilaterally carry out the eviction of the borrower and take over forcible possession of the secured asset”. (Emphasis supplied)

In this case, even the assistance of the police machinery has not been taken by the respondent no.3 though force was used for taking possession of the said flat.

17 Mr.Sathyanarayan, the learned counsel for respondent nos.2 and 3 has placed reliance on a decision of the Supreme Court of India in the case of Standard Chartered Bank Vs. V.Noble Kumar and others, (2013) 9 Supreme Court Cases 620,in support of his contention that the action of the respondent no.3 in taking possession of the said flat is perfectly lawful and that therefore, there was no question of proceeding against the respondent nos.2 and 3 on the allegation that they have committed offences.

- - - - - - - - -

These observations leave no manner of doubt that when the question of use of force for overcoming the resistance offered by the borrower, for taking possession of the secured asset would arise, recourse must be taken to the provisions of section 14 of the SARFEASI Act.

19 The things can be further complicated where the secured asset which is a residential flat is containing movable property, and the possession of such a secured asset is taken along with the movable property contained therein, by a secured creditor on his own – and without involving the State machinery in the process of taking possession by use of force. In the instant case, the lock put on the premises was broken open at the instance of the respondent no.2. Possession of the flat was taken in the absence of the complainant or his representative. It is not in dispute that several household articles including refrigerator, washing machine, business files, computer, books etc. as also gold and silver ornaments belonging to the complainant and his wife were in the said flat. What has happened to the articles has not been verified or checked by anyone, and it is only the word of the respondents that the movable property contained in the said flat, is still lying there. It is obvious that the respondent no.3 which is a body corporate is taking such a stand on the basis of the information received by it from the persons who were actually involved in the process of taking physical possession of the secured asset. The complications that can arise in taking possession in this manner are too obvious. For instance, if the complainant was to notice – or even falsely claim for that matter – that some of the household belongings are missing, a case of theft would have to be registered. The possibility of thefts taking place in such cases cannot be totally excluded, but what is more significant is that the possibility of the persons involved in the process of taking the possession being falsely accused of theft, mischief etc, undoubtedly exists. Taking possession in this manner is, therefore, not quite in the interest of the secured creditor also. Thus, in any case, it would be advisable to involve the state machinery in the process of obtaining possession of such a secured asset even from the point of view of the secured creditor, when the process has been undertaken bonafide.

20 I have carefully gone through the order passed by the learned Magistrate dismissing the complaint filed by the complainant. I find that the complaint came to be dismissed only on the ground that the complainant was a defaulter, and that therefore, the possession of the secured asset was rightly taken by the respondent no.3. The learned Magistrate did not discuss as to 'whether the respondent no.3 and its Officers were entitled under the provisions of SARFEASI Act, and the Rules to break open the lock put on the premises, and take forcible possession of the said flat in the absence of the complainant'. The Magistrate did not consider the legal effects of taking possession in such manner, and thereby keeping the complainant out of the possession of his own belongings kept in the said flat. The Magistrate did not consider whether breaking of lock would amount to an offence or not. The Magistrate did not consider whether or not it was necessary to ascertain whether the movable property of the complainant was damaged/removed; and if so, whether it would amount to any offence. More importantly, the Magistrate completely ignored the averments made in the complaint to the effect that the persons of the respondent no.3 had gone to the said flat, and had threatened the complainant and his wife though the complainant had specifically stated that record of the said incident was available in a CD. The Magistrate did not consider whether on a prima facie view of the matter, such threats were found to have been given, whether the same would amount to an offence or not.

21 The order passed by the Court of Sessions in Revision is also perfunctory. It does not consider whether on a reading of the complaint, a case for ordering investigation into the matter was made out. The learned Addl. Sessions Judge has concluded that there was no illegality in the acts attributed to the respondent no.3 and its officials only on the basis of the finding of the Debt Recovery Tribunal which was not permissible. The learned Addl. Sessions Judge ought to have come to his own findings in that regard, and that too independently.

22 In the course of arguments, I have asked the learned counsel for the respondent nos.2 and 3 as to what they propose to do with respect to the movable property belonging to the complainant which is still lying in the said flat. It was submitted that a notice to remove the same has been given to the complainant by publishing the same in newspapers. However, there was no dispute with respect to the fact that while the movable property is lying there, the flat in question cannot be properly sold.

24 The provisions laid down under the SARFEASI Act are drastic. The provisions permit a secured creditor to take possession of a secured asset without the intervention of the Court. These provisions are drastic, and therefore, the procedural aspects thereof, must be scrupulously followed. Neither the learned Magistrate nor the learned Addl. Sessions Judge realized the seriousness of the issue viz: whether a secured creditor could take forcible possession of a secured asset which is a residential flat, by breaking open the lock put on the premises, and that too, in the absence of the borrower or his representative. None of them considered whether any offences had been committed by any persons in the process of taking the possession of the said flat. Simply because the possession is claimed to have been taken in accordance with the provisions of the SARFEASI Act, it would not follow automatically that no offences had been committed in the process.

25 Though I hold that the impugned orders are not proper and/or legal, it is not easy to decide, on the facts alleged and on the material that was before the Magistrate, as to what offences, if any, have been committed, and by whom. It is because taking possession, simplicitor, even if in a wrongful manner, would not, by itself, amount to an offence. It would all depend on the mens rea on the part of the person or persons that accompanied the act of taking possession. Whether any offences have been committed in the process of taking the possession of the said flat, and if so, by whom, can be properly decided only after investigation is carried out.

26 This was a case where commission of offences – including cognizable offences – was alleged, and investigation under section 156(3) of the Code was needed to ascertain whether any, and if so, what offences have been committed – and by whom? Since the prayer of the complainant was that investigation into the matter as contemplated under section 156(3) of the Code be ordered, the Magistrate ought to have allowed it. There were certainly grounds for ordering such investigation.

27 Petition is partly allowed.

28 The impugned orders are set aside.

29 The learned Magistrate is directed to order investigation, as contemplated under section 156(3) of the Code of Criminal Procedure, in the complaint filed by the petitioner.

30 Rule is made absolute in the above terms.

(ABHAY M.THIPSAY, J)

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 (2) Banishing English from Indian Courts

 

The following article is self explanatory:-

When Will English be Banished from Indian Courts

Ved Pratap Vaidik

http://www.scoopnews.in/det.aspx?q=44054

After all when will Indian languages be used in the Higher Courts of India? When will English be banished from them? It has been more than 67 years that India has gained independence but in our High Courts, the slavery of English is continuing till date. All our laws and ordinances are also drafted in English. Why nobody has attacked this slavery in our Parliament and High courts? It is so because the article 348 of Indian Constitution says that the language of the Supreme Court and the High Courts shall remain English. Neither the judges would be able to give their judgments in Hindi or in any regional language nor the lawyers can prosecute the case in Indian languages. They will have to do all their work in English. If any judge or advocate wishes to use Indian language he would not be permitted to do so.
There is a ban on Indian languages in the Higher Courts of India. What could be more shameful for this country? But our esteemed judges and able lawyers keep on putting up with this insult. They are clueless because they have studied the law in English and in India only that law is enforced which has been laid down by the Britishers. In the past 67 years although we have been framing the law in our Parliament, but that too in English. These laws are written in the same complicated style which was a 
Colonial one. Even those, who are proficient in English fail to understand it. Even the skilled judges and advocates get so bugged up that even simple cases get procrastinated for years. Till date more than 3 crore cases are pending in our courts. Most of time and energy of judges and lawyers squandered in unraveling the meanings of the English terms. John Stuart Mill has very well said that the justice delayed is justice denied. These laws, and the arguments on them and the judgment passed there on become a matter of sorcery for a common man. Against this very act, a lawyer filed a PIL in the Supreme Court. He has demanded amendment in article 348. The official language of the Supreme Court must be made Hindi and in High Courts, the use of regional languages must be allowed.
This case is under consideration in Supreme Court but a strange thing has happened of late. The Court has asked for its opinion from Rajbhasha Department Of Government of India which is supposed to have a major role in promotion of Hindi language. The Department tells the Supreme Court not to impose Hindi on judges and lawyers against their wish. Let the High Courts continue with English. Here this official view provokes me to think that why did we fight for independence? The way English has been imposed on us, even Britishers could have continued to rule us. I ask the Government is this your Rajbhasha Department or the Department of slavery? The suggestion by the department shows how moron it is? Its opinion is a blot on the government of 
Narendra Modi. Till now Narendra Modi has earned lot of appreciation and fame by focusing on the use of Hindi but Rajbjhasha Department has drained down his efforts. If our Home minister and Prime Minister do not act against the Department of Rajbhasha then BJP government would become a fake nationalist party in the eyes of the common man and its nationalism would be tagged as false nationalism. Lakhs of devoted BJP leaders and Sangh workers who have been raised on the slogans of Hindi and Hindustan, would distance themselves from this government. It would be considered that if Modi is also like any other ordinary Prime Minister and not a real leader. The way previous governments used to get enslaved by English and toe the line of the bureaucrats, the same way this party with clear mandate is also following into their footsteps. What did the people of India gain by giving it clear majority? Its leadership is also handicapped like that of Congress. The power has detached her from its ideological moorings. This government has forgotten its manifesto on the question of language. Yes, Narendra Bhai, you must establish Hindi in the United Nations but first save it at home from being crushed under the boots of English.
All the countries of the world who are called superpowers, have their own language in their High Courts. Its only in some former slave countries like India that a foreign language has the monopoly. As the education level rose in European countries, the prosperity increased, modernization got accelerated and self esteem boosted, they shook off Greek and Latin and adopted their own language in totality. In 1539, France said goodbye to Latin from its courts. In the 18th century, Germany shrugged off Latin. English courts were so much slavish to German and French languages that if someone used 
English in the courts, he had to pay the penalty to the tune of few pounds. But in 1362, English was declared as the official language of the British courts. Same way in the last 100 years, Russian in Russian courts and Chinese in Chinese courts is used. In the courts of many European countries, English is banned.
The high courts of these powerful countries do not use any foreign language because it violates their human rights. The argument which is not comprehended by the litigant and the defendant is a travesty of justice. It is not justice but injustice. If only a handful of people can understand the judicial process, it is not justice but a conspiracy. It is against the tenets of the democracy. Why is the judicial process so expensive in India? Why has it gone beyond the reach of a common man? Just because it is in a foreign language. It is used as a Jadu-Tona, a witchcraft, to fleece the common folk.
We expect from the nationalistic government of Narendra Modi that it brushes aside the fake excuses to continue English in our courts and as per the advice of Rajbhasha Parliamentary Advisory Committee, it must bring a constitutional amendment bill without delay under which Hindi must be declared as the official language of the Supreme Court and all 24 High Courts must get facility to use their regional languages. For the lawyers and judges for whom English is unavoidable, there may be immunity for five years. After that a fine must be imposed on the use of English. This rule must be enforced on Parliament’s law making process too. No law should be drafted in a foreign language. The law should be taught at our universities in our own language, if at all we want a real democracy to flourish in our country.
(The author is a well-known Scholar, Political Analyst, Orator and a Columnist on national and international affairs. Dr. Vaidik worked with Press Trust of India for a decade as the Founder-Editor of its Hindi News Agency “BHASHA” Chairman, Council For Indian Foreign Policy. Feedback :dr.vaidik@gmail.com) 

(3) Japanese Diet Tips for Health & Beauty 

Mr U.C. Desai, Ahemdabad has sent the following useful information:--

 

Japanese Diet Tips To Make You Healthier 
And Beautiful Both Inside And Outside

 

The Japanese have the longest life span in the world with 86 years for women and 79 years for men. All of this is thanks to what they eat thus making the island nation with the lowest obesity rate (3%) in the developed world. "The Japanese diet is the iPod of food," says Naomi Moriyama, a dietician, "it concentrates the magnificent energy of food into a compact and pleasurable size."


1. Eat with your eyes
There's a proverb in Japan that literally translates as "Not dressing up the meal with color is like sending someone out of the house without clothes." Traditional Japanese meals use food items that are red, green, yellow, white and black in colour to give the food an aesthetic appeal and reflect the nature of the seasons. Compare a platter of sushi or a bento box to a hamburger and fries (although the latter is perceived as delicious and can be wolfed down) the former is a work of art that has to be appreciated like art. Go slow, take small bites, relish every flavour.

2. Smaller portions
Break down your meal into smaller portions, this way you can enjoy a greater variety of foods. 

Scientists in the University Of Illinois found that people tend to eat up to 45% more when they are served bigger portions. They filled their plates according to it's size. So bigger the plate, larger the portion size. 
Lesson learnt: Use dessert and salad plates.

3. Fill your stomach up to only 80%
Or Hara hachi bunme as it is said in Japanese. The idea is to reinforce the eating of smaller portions. We have been raised to eat until we are absolutely full so that we don't feel hungry later. However it's better to not stuff ourselves and only eat until we feel adequately full.

4. Light dinner or supper
Following the 80% rule discussed above, a light dinner puts less pressure on your intestines and allows you to digest your food in your sleep. Heavy meals can sometimes make you wake up feeling full in the morning and this upsets your routine when you skip breakfast.

5. Rice is nice
Rice is a low fat complex carbohydrate that helps fill you up on lower calories (small bowl of rice has lesser calories than two slices of bread) This will not keep you hungry and craving for snacks right after your meal.

From U.C.Desai ( Arogyaganga) Ahmedabad (M) 09374556625

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Popularity of our web site :- The key word for search of our website is 'drt'  or any phrase commencing with 'drt'  We are on the top in Google Search for 'drt' among 28,60,000 results globally. In most of the search engines like yahoo, msn, google, excite, altavista, mamma, alexa etc., To verify, you may visit www.yahoo.com, www.msn.com, www.rediff.com, www.indiatimes.com, www.altavista.com, www.google.com, www.excite.com, www.hotbot.com, www.123india.com, www.aol.com, etc. Our reference appears in www.economictimes.com, www.amazon.comwww.financialexpress.com, www.lawcrawler.com, www.findlaw.com, www.law.com, www.supremecourtofindia.com, www.supremecourtonline.com

(2) We have created a separate web site www.usindolegal.com which deals exclusively with our US joint venture enterprise for activities like BPO, legal BPO, DRT etc. This site has started appearing in the search results of Google, Mamma, Alexa and Yahoo.

Application of Law of Torts in claiming Damages from Municipal Corporations for demolition of structures, closure of shops etc:- In many parts of the country, the Municipal Corporations are demolishing structures like shops and houses which existed for number of years. The shops existing for number of years are proposed to be shut down. The affected persons should claim Damages under the Law of Torts, which would be substantial. It is learnt that in Delhi itself about 5 lac shops are to be closed down and about 25 lac persons would be out of jobs. All these persons should file damage suits in the civil court. Since the damages would be substantial, the suits may be filed as Indigent Persons. Since the damages would attract interest, the usual delay by the civil courts will not affect the final outcome. The affected shop owners may discuss the details with us on phone.

Our Articles for Borrowers and Guarantors:- Our articles on DRT matters have been published in the Financial Express. The All India Manufacturers Organisation in its famous web site www.aimoindia.org has reproduced copies of our four articles. These original articles can be searched in the archive of the Financial Express in its web site www.financialexpress.com Two of these articles have been reproduced in other pages of this web site. 

Useful link www.WorldVideoBusiness.com :- WorldVideoBusiness-WVB® is a business to business e-marketplace source of international trade leads, and tender opportunities from companies and government organizations around the globe.

About Us in Brief :-  (1) We specialize in DRT (Debt Recovery Tribunal) and NCLT (National Company Law Tribunal) matters. As a whole you may approach us for all DRT Problems and Solutions as well as matters connected with ARCIL i.e. Asset Reconstruction Company (India) Limited,  We have a Joint Venture with an America based law firm for various activities like BPO, legal BPO and DRT. The details of the said American firm and the joint venture may be seen at the page - Our US Joint Venture with Anand Ahuja Associates or in www.usindolegal.com (2) For your all problems including those in DRT, please phone us or send e-mail. Please give your contact details along with your problems in brief. As a whole you may approach us for all DRT Problems and Solutions.  (2) With our Legal Opinion, you need not worry about the Securitisation Act or other DRT matters or NCLT. Please visit the page Products & Services and Frequently Asked Questions (3) On account of our expertise in the Law of Torts and Banking and experience past 15 years, we can help you to submit suitable defence with winning strategy in DRT cases, Securitisation Act, Guarantors' defence etc.  (4) We need only copies of all available documents  to render our expert 'Legal Opinion' which will be quite useful and valuable to you particularly in DRT i.e. Debt recovery Tribunal. (5) We have also handled assignments for preparation of damage claims against Electricity Boards, Insurance Companies, Municipal Corporations etc. all on the basis of the Law of Torts.  (6) The DRT counterclaims is to be prepared well in advance so that it could be raised at proper time in DRT or other forum to safeguard the securities and assets. (7) Several DRT counterclaims drafted by us are being handled by different advocates at DRT Mumbai, DRT Delhi, DRT Jabalpur etc. Thus DRT advocates are available in these cities. Cases in other Debt Recovery Tribunals are under process. (8) This site is updated monthly mostly on every first Monday of the month or for urgent release on any day with latest material. (9) For further details about us, please visit the page About Us-DRT Solutions As a whole you may approach us for all DRT Problems and Solutions. We hail from the place to which Maharishi Mahesh Yogi and Acharya Rajnish belong and hence this site is dedicated to them.

Our this web site is dedicated to Yoga Rishi Baba Ramdev Ji Maharaj:- Our this web site is respectfully dedicated to Yoga Rishi Baba Ramdev Ji Maharaj whose method of Pranayam has cured even incurable diseases and thus has revolutionized modern medical science. For further details please visit our special page by clicking here Baba Ramdev Ji Maharaj, Yoga Guru, Cure for All Diseases, Medical Science Revolution

Site also dedicated to:-   (1) Swami Ramdevji, Acharya Balkishan and their Guru Pradumn Maharaj.

                                             (2) H.H. Maharishi Mahesh Yogi and Acharya Rajnish, the greatest gurus of all time www.maharishi.com, www.osho.com

                                           (3) Shri Hira Ratan Manek (HRM) for his pioneering work on Solar healing vide his web site www.solarhealing.com and forum at www.lifemysteries.com                                    

We regularly practice TM and SCI of Maharishi Mahesh Yogi. We also regularly practice Hath Yoga including Pranayam based on Baba Ramdev Ji  Maharaj. We daily watch his global TV program on Astha Channel from 05:30 AM to 8AM and 8PM to 9PM Indian Standards Time. On Sanskar channel, we daily view the discourse of Pradumn Maharaj from 4 AM to 5:30 AM. Many chronic diseases such as Cancer, Parkinsons' disease, Polio, Asthma, Hypertension, diabetes etc. have been cured by the said method of Pranayam which can be learnt even by watching his program on TV. Since 30th March '06, we have started practicing Sun Gazing as prescribed by HRM.

                                    (3) Shri Satyanarayan Morya alias 'Babaji' for his praiseworthy service to our nation. Please visit his site www.artistbaba.com 

Disclaimer:- We have no branch or setup other than at Indore. It is observed that some persons are using name of our firm as well as name of our web site. We have not given  any such authority to anyone to do so. Under such facts and circumstances, if anybody suffers any loss, we shall not be responsible. If such instance comes to notice of someone, we may kindly be informed.

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