DRT  Legal  Solutions

(Debts Recovery Tribunal Legal Solutions) is an India based

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

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

Personal Interest in Longevity, Wellness, Meditation, Laughter Yoga and Sound Health 

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 DRT Solutions Weekly Mail - 391st to 400th Issues

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Expert in:- DRT, Counterclaim, securitization, debt recovery tribunal, NCLT  matters




DRT Solutions Weekly Mail – 400th Issue dated 5th February ’16

All Weekly mails right from 1st Issue to latest, click links above


(1) Deposit Condition in DRTs 

Many of our new clients inform that in their DRTs, the advocates and judges are insisting for initial deposits at the time of filing of the written statement or for granting the stays. We have repeatedly informed that such conditions are illegal. The relevant facts and law are as under:-

(a)   Prior to 2004, in DRT Act 1993, there was a condition of deposit at the stage of filing of written statement but after the SC Judgement in the matter of Mardia Chemicals, the said condition of deposit was removed and the Act was amended. Hence no deposit is required to be made at the time of filing of the written statement by the borrower.

(b)   If the borrower has filed the counter-claim and if the said counter-claim is more than the claim of the bank, there is no need of submitting any stay application and hence there is no question of any deposit. 

(2) Counter-claim is a must in DRTs 

We have repeatedly informed that without counter-claim, the defence of the borrowers and guarantors in DRTs is incomplete. In almost all the cases, it is found that such counter-claim is much more than the claim of the banks and hence prima facie there is ‘No Debt Due’. Under such facts and circumstances there can not be any recovery till the said ‘No Debt Due’ condition is finally decided by the DRTs. Such decision needs proper adjudication which will take a very long time.


(3) DRT is a Trial Court 

We have repeatedly informed that DRT is a trial court where proper and full trial has to take place to ascertain the facts. The said facts are contained in documents which are in power and possession of the banks. Hence all the relevant documents are required to be produced, inspected and brought on record. This will itself will take long time and by this process only the wrong doings of the banks and hence the consequent counter-claim will be proved.


(4) Video Recording in DRTs 

We have repeatedly informed that the video recording in DRTs should be commenced. In fact as early as 2007, we demonstrated the complete process and system before the District Judge, Indore and it was appreciated by him. This was reported to the High Court and the Supreme Court but till date it has not been introduced.  Recently Mr Mathews and his team has done commendable work in this direction and the day is not far when we will have video recording in court rooms.


(5) The above matters are the Highlights of this 400th Issue of our Weekly Mail 

With this 400th issue of DRT Weekly mail, we are completing a history unmatched by any organization in the field of defence of the borrowers and guarantors and hence we have brought out the above important matters on this historic occasion. In this connection we have received several mails and phone calls. One of such mails is reproduced below:-

--------- Forwarded message ----------
From: Rohit tibrewal <rohit.tibrewal14@gmail.com>
Date: Wed, Feb 3, 2016 at 8:35 AM
To: Ram Kishan <ramkishandrt@gmail.com>

Dear Sir 

Your mails are really helpful guides. They reflect that success is hard work, dedication to the job at your hand and the determination that whether win or lose, apply the best to the task at hand. The will to win is important but the will to prepare  is vital,  your mails are really mentor, they are lights and  guides in darkness. Sir, your talent is gods gift, what you are doing is gifting back to god.


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DRT Solutions Weekly Mail – 399th Issue dated 29th January ’16

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


(1)      Draft Insolvency and Bankruptcy Bill 2015

The following news item is self explanatory:-


Joint Parliamentary Committee invites Comments on the Draft Insolvency and Bankruptcy Bill, 2015

Knn India



New Delhi, Jan 27 (KNN) The long awaited Bankruptcy Code has reached the crucial stage of approval by the Parliament of India.
The Code prepared by the Vishwanathan Committee and approved by the Cabinet was placed before the Parliament and the House of People has decided to refer it to a Joint Parliamentary Committee.
By a recent notification the JPC secretariat has asked comments of the stakeholders by 10th February, 2016.
The draft Insolvency and Bankruptcy Code must be considered as a watershed development for ‘Easing of Doing Business’.
The Insolvency and Bankruptcy Bill, proposed by the Vishwanathan Committee, fulfils a long standing demand from the Industry and business for an legal environment facilitating easy exit from a non-viable venture.
Structured on the model of U S Bankruptcy Code, the greatest contribution of the proposed Act, if enacted, will be repelling of draconian Presidency Towns Insolvency Act, 1909 and the Provincial Insolvency Act, 1920 under which the straight path for an insolvent was prison.
The cornerstones of the proposed act are the transparent processing of the bankruptcy / insolvency case and stipulation of strict time frame for the entire process.
The draft Bill proposed a total time frame of 180 days for closure of any bankruptcy / insolvency proceeding, which in certain cases could be closed in straight 90 days.
The draft even proposes the maximum number of days an Bankruptcy / Insolvency Adjudication Authority may take at each stage to dispose of the matter thus overriding long pendency in judicial procedures.
The real paradigm shift proposed in the draft Bill is in the treatment of the Proprietary and Partnership firms, which constitutes nearly 99% of the MSME sector in India.
While some legal framework already exists for the Bankrupt/ Insolvent corporate entities; for the non-corporate firms any failure of the entity meant lifelong hassles for the owner(s).
While there are quite a few laudable initiatives under the proposed Act, there are also issues of concern particularly regarding treatment of Bankrupt/ Insolvent non corporates to which category the Indian MSMEs predominantly belong.
The existing Debt Recovery Tribunals (DRT) have been proposed to be the Adjudicating Authorities in relation to insolvency matters of individuals and (partnership) firms. With their present focus on expeditious adjudication and recovery of debts due to banks and financial institutions, how these institutions will be able to take a balanced view on the creditors’ and debtors’ interests, is a big question.
The experiences of majority MSMEs are these DRTs mostly take care of the Bankers’ interests.
The draft Bill also specifies the crucial role of processing the Insolvency / Bankruptcy application from an individual / firm and preparation of the ‘Repayment Plan’ to the Resolution Professional. In India today, where there is not much expertise available on Insolvency resolution and large number of Non-Performing Assets of the Banks, availability of required number of Resolution Professionals to expeditiously process the Insolvency cases will be a big question.
Another glaring lapse, according to the experts, in the proposed Bill is while the  archaic Bankruptcy Acts have been proposed to be repealed, the two more recent Acts, viz.,  Recovery Of Debts Due To Banks And Financial Institutions Act, 1993, popularly known as DRT ACT and   Securitisation And Reconstruction Of Financial Assets And Enforcement Of Security Interest Act, 2002, popularly known as the SARFAESI Act, have  been left intact.
Both these acts are at present the principal tools of the Banks, who in most cases are the predominant creditors of any entity, corporate and non- corporate, for realisation of debts and with the enactment of the proposed Insolvency and Bankruptcy Bill should become infructuous.


(2)      Denied Justice, Dalit wants to Give Up Indian Citizenship

The following news item is self explanatory:-


Denied justice, dalit family wants to give up Indian citizenship

Ashish Chauhan | TNN | Jan 24, 2016, 01.30 PM IST


Ahmedabad: In a shocking case of apathy , a dalit family has offered to give up their Indian citizenship because they are being deprived of their constitutional right to justice --in a case of land-grabbing by local strongmen of their Sabarkantha village. This offer comes after more than four letters from the CM, eight from the Gujarat governor, two from the DGP , four from the social welfare minister and 50 from various state secretaries, who have not yet been able to help them.

Chandu Nadiya (42), a native of Ahmedpura village of Talod taluka of Sabarkantha district, had in 2007 found that his ancestral land measuring around 30 bighas (71,340 square metres) was transferred to four people from the same village. They began a legal fight to get their land back, but they would not have imaging that this would multiply their miseries.

Nadiya had in 2011first approached the local authorities like the mamlatdar, deputy collector and the revenue department, but as no relief came, they moved to the Special Investigation Team (SIT) for land cases and the revenue tribunals. However, the SIT order went against them, stating that the case has been disposed in the Supreme Court.

When the aggrieved persons filed an RTI inquiring in such an SC order, the reply stated that the case had never reached the apex court. One SIT member wasn't even present on the day of verdict, on July 24, 2014.


Following this setback, the victim started approaching the state secretaries of the social welfare and revenue departments, and the authorities ordered that action be taken against those responsible and the state government employees involved in the case. Again, no actions were initiated. This led the farmer to approach the director general of police (DGP), who on June 20 directed the filing of an FIR against all the accused. However, that too remained unheard by the district authorities.

Nadiya then wrote eight let ters to Governor O P Kohli. Fed up, the dalit man sought euthanasia for him and his family including his wife, two daughters aged 12 and five respectively and his three-year-old son.Kohli also directed that stern action be taken in the case, but it did not get any response. At last, Nadiya wrote four letters to chief minister Anandiben Patel, seeking action in this case. However, the authorities have remained unmoved. Nadiya then wrote to the CM again, stating that he has become a victim of `intolerance' and offered to give up his citizenship.


When contacted, Nadiya said, "There is no meaning to keeping such futile documents like voters' ID card or ration card, when we are not given constitutional rights. Even the CM's orders are not followed, so there is no option left for me.So, as a final protest, my family and I can give up our citizenship."

Sabarkantha district collector P Swaroop denied the dalit family's charge as "just misrepresentation of facts." "The land was earlier belonging to them, but they had long ago sold it to other people. When the issue went to the social justice and welfare department, we gave a proper reply that the land did not belong to Nadiya.The case was decided at the mamlatdar level twice and once at the collector level," added Swaroop.


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DRT Solutions Weekly Mail – 398th Issue dated 22nd January ’16

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


(1)      SC – SARFAESI can not override Rent Control Laws


The following news item is self explanatory:-


SARFAESI Act cannot override Rent Control Laws; Tenants cannot be evicted using provisions of SARFAESI Act: Supreme Court By: Ashok KM | January 21, 2016 


A tenant cannot be arbitrarily evicted by using the provisions of the SARFAESI Act as that would amount to stultifying the statutory rights of protection given to the tenant. A non obstante clause (Section 35 of the SARFAESI Act) cannot be used to bulldoze the statutory rights vested on the tenants under the Rent Control Act, the Court said.


In a significant ruling, Supreme Court of India has held that the provisions of the SARFAESI Act cannot override the provisions of the Rent Control Act. Apex Court Bench comprising of Justices V. Gopala Gowda and Amitava Roy, in Vishal N. Kalsaria vs. Bank of India, said that non obstante clause as in section 35 of the SARFAESI Act cannot be used to bulldoze the statutory rights vested on the tenants under the Rent Control Act.


Context The Appellants were the tenants occupying the property mortgaged in the Bank. Since the landlord defaulted payment of dues, the Bank proceeded under SARFAESI Act, and the Magistrate allowed the application of the bank seeking possession of the mortgaged properties which are in actual possession of the Appellant. The Appellants approached Small causes court and the court passed an interim injunction against obstructing the possession of the appellant over the suit premises during the pendency of the suit. The Appellants, as interveners, then filed an application as an intervener to stay the execution of the order of Magistrate which was refused. Relying on ‘Harshad Govardhan Sondagar v. International Assets Reconstruction Co. Ltd.’, the Magistrate held that when the secured creditor takes action under Section 13 or 14 of the SARFAESI Act to recover the possession of the secured interest and recover the loan amount by selling the same in public auction, then it is not open for the Court to grant an injunction under Section 33 of the Rent Control Act. The Magistrate also held that order passed in Rent suit cannot be said to be binding upon bank. The tenants approached Supreme Court. SARFESI Act cannot override Rent Control Laws The Apex Court held that a landlord cannot be permitted to do indirectly what he has been barred from doing under the Rent Control Act, more so when the two legislations, that is the SARFAESI Act and the Rent Control Act operate in completely different fields. Rejecting the contention of the Bank that the SARFESI Act override provisions of Rent Control Act, the Court said that if it were to be accepted, it would render the entire scheme of all Rent Control Acts operating in the country as useless and nugatory since tenants would be left wholly to the mercy of their landlords and in the fear that the landlord may use the tenanted premises as a security interest while taking a loan from a bank and subsequently default on it. A landlord would simply have to give up the tenanted premises as a security interest to the creditor banks while he is still getting rent for the same. In case of default of the loan, the maximum brunt will be borne by the unsuspecting tenant, who would be evicted from the possession of the tenanted property by the Bank under the provisions of the SARFAESI Act. Under no circumstances can this be permitted, the Bench said. Harshad Govardhan Sondagar case misinterpreted The Court also said that decision in Harshad Govardhan Sondagar case cannot be understood to have held that the provisions of the SARFAESI Act override the provisions of the Rent Control Act, and that the Banks are at liberty to evict the tenants residing in the tenanted premises which have been offered as collateral securities for loans on which default has been done by the debtor/landlord. The Court said ‘Random sentences have been picked up from the judgment and used, without any attempt to understand the true purport of the judgment in its entirety’ In Harshad Govardhan Sondagar case, the Apex Court had held that where, however, the lawful possession of the secured asset is not with the borrower, but with the lessee under a valid lease, the secured creditor cannot take over possession of the secured asset until the lawful possession of the lessee gets determined. Tenant can only be evicted under Rent Control Laws. The Court also observed that tenant can be evicted only after following the due process of law, as prescribed under the provisions of the Rent Control Act. A tenant cannot be arbitrarily evicted by using the provisions of the SARFAESI Act as that would amount to stultifying the statutory rights of protection given to the tenant, the Bench said. The Court also said that in view of the Rent Control Act, the onus to get such a deed registered is on the landlord and hence neither the landlord nor the banks can be permitted to exploit the fact of non-registration of the tenancy deed against the tenant. Section 35 SARFESI Act only extends to Laws operating in same field. A non obstante clause (Section 35 of the SARFAESI Act) cannot be used to bulldoze the statutory rights vested on the tenants under the Rent Control Act. The expression ‘any other law for the time being in force’ as appearing in Section 35 of the SARFAESI Act cannot mean to extend to each and every law enacted by the Central and State legislatures and It can only extend to the laws operating in the same field, the Court held.

(2)       Making Indian Arbitration Effective

The following news item is self explanatory:-

Making Indian arbitration effective

Amendments to the Arbitration Act could boost investors’ confidence in India

By: Alipak Banerjee and Vyapak Desai | January 15, 2016 2:15 AM

Due to certain controversial decisions made by the Indian judiciary in the last decade—especially in cases involving a foreign party—investors have kept a close watch on the development of arbitration laws in India. They have often criticised the judiciary for its interference in international commercial arbitration and extraterritorial application of domestic laws to awards obtained outside the country. Foreign investors and corporate entities considered it as a major risk factor for doing business in India. In fact, the delay in the judicial process led to the first investment arbitration claim against the country in the White Industries vs the Republic of India case, where the Republic of India was directed to pay a hefty sum by the arbitral tribunal.

In 1996, the Arbitration and Conciliation Act, 1996, was passed with the optimism that it would bring in winds of change, but fell into a chasm of its own. A number of decisions from the courts slowly but surely ensured that the preferred seat in any cross-border contract was always a heavily negotiated point and, more often than not, ended up being either Singapore, New York or London—the established global arbitration centres.

However, developments in arbitration jurisprudence through recent court decisions have now shown the support of the judiciary in enabling India to adopt international best practices. Never before has one seen so many pro-arbitration rulings by the Indian courts. From 2012 to 2015, the Supreme Court delivered various landmark rulings showing a much-needed pro-arbitration approach, such as declaring the Indian arbitration law to be seat-centric; removing Indian judiciary’s power to interfere with arbitrations seated outside the country; referring non-parties to an arbitration agreement to settle disputes through arbitration; defining the scope of public policy in foreign-seated arbitration; and determining that even fraud is arbitrable.

In furtherance to measures taken by the Indian government in support of the ‘ease of doing business’, after two aborted attempts in 2001 and 2010 to amend the arbitration law, on October 23, 2015, the President promulgated the Arbitration and Conciliation (Amendment) Ordinance, 2015. The amendments incorporated the essence of major rulings passed in the past two decades, including most of the recommendations of the 246th Law Commission Report, and clarified the major controversies that arose in recent years.

Thereafter, on January 1, 2016, the Arbitration and Conciliation Amendment Act, 2015, was notified in the official gazette, which amended the provisions of the 1996 Act prospectively. The amendments are aimed at taking drastic and reform-oriented steps to bring the Indian arbitration law on a par with global standards and provide an effective mechanism for resolving disputes with minimal court interference. The amendments came into effect keeping in mind the objective of the Act to provide a speedy and cost-effective dispute resolution mechanism which would give finality to the parties.

In tune with arbitration-friendly jurisdictions, the amendment Act has introduced a fast-track procedure where arbitrations can be completed expeditiously. The arbitral tribunals have been given a 12-month time-line for completion of arbitrations seated in India, which can be extended by six months with the consent of the parties. This time-line is stricter than the average time taken for an arbitration in any other jurisdiction, which is usually about 18-24 months. The amendment Act has gone a step further by prescribing time-lines for expeditious disposal of arbitration applications which are required to be filed before courts, in aid of the underlying arbitration.

The amendment Act has also introduced significant changes by giving the parties the flexibility to approach Indian courts for interim relief in aid of foreign-seated arbitrations, which reverses the position rendered by the ruling in Bharat Aluminum Co vs Kaiser Aluminum Technical Service Inc on this issue. In accordance with international standards, the ‘costs follow the event’ regime has been introduced, which will help in reducing filing of frivolous claims. In addition, the tribunal’s power to grant interim protection has been made akin to the powers of the court, thereby encouraging the parties to take recourse before the arbitral tribunal. It will, in effect, reduce the burden on the court which, in any case, is suffering from a huge backlog of cases. In order to streamline the process, interim orders passed by tribunals seated in India will be deemed to be the order of court and thus enforceable.

Arbitration thrives on the principle of integrity, independence and impartiality of the arbitrators. To that effect, guidelines and detailed schedules on ineligibility of arbitrators have been introduced by the amendment Act, which is undoubtedly commendable and brings Indian law on a par with international standards.

As India was viewed as a jurisdiction which offered excessive judicial interference, the grounds on which awards arising out of international commercial arbitrations seated in the country may be challenged has been limited. In addition, contrary to the previous position, the amendment Act has mandated no more automatic stay on filing a challenge to an arbitral award in absence of a specific order from court.

The amendments are salutary with an aim to make India an attractive investment destination, but it may not be possible to adhere to all the strict standards prescribed. For example, in a complex arbitration, it may not be possible to complete the entire arbitration within 12 months and, therefore, we will see more applications being filed before the courts for extension of time. Further, by giving the amendment Act prospective effect, the amendments would not be applicable on the existing arbitrations which have commenced before October 23, 2015; it thereby reduces the immediate impact of such amendments. The appointing authority for arbitrators (i.e. in absence of party-nominated arbitrators) is still the court and any recourse to the courts adds on to their burden, which, in any event, are suffering from pendency of cases. Instead, a nationwide institution could have been established to administer and also act as appointing authority from a larger pool of practitioners who have experience in dealing with complex disputes. Independent of the amendments, there is also an urgent need to introduce a change in the mindset and culture in the way arbitrations are conducted in India to make it an efficient and effective alternate dispute resolution mechanism.

The year 2015 saw a huge rise in cross-border transactions in the country. The Competition Commission of India saw a record filing of 115 merger and acquisition cases—the highest registered in a calendar year—and even foreign direct investment went up by 40%. Therefore, the amendment Act is a step towards the right direction and will help promote ease of doing business in India, thereby boosting investor confidence.

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DRT Solutions Weekly Mail – 397th Issue dated 8th January ’16

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(1)      Insolvency Resolution System


The following news item is self explanatory:-

A robust insolvency resolution system can speed up loan recovery for banks




Banks can now hope to recover more from their bad loans, if the Bill to consolidate and amend all laws relating to insolvency resolution is passed in the Lok Sabha. Currently, banks take as long as 15 years in certain cases to recover their money, which substantially erodes the value of the assets.

According to a World Bank report, it takes, on an average, more than four years to wind up a company in India, which is more than twice the time taken in China and in the US (1.5-1.7 years). In the process, creditors in India recover only 25 cents to a dollar, compared to 36 cents in China and a substantial 80 cents in the US.

The proposed legislation — the Insolvency and Bankruptcy Code 2015 — which fixes a time limit of 180 days, for completion of the insolvency-resolution process, can be a huge positive for the banking sector.

The main reason for the delay in the bankruptcy process in India has been the existence of multiple laws governing insolvency According to KV Karthik, Partner, Financial Advisory Services, Deloitte Touche Tohmatsu India LLP, in India, besides the Companies Act, 2013, bankruptcy is dealt with by three major legislations — the Sick Industrial Companies (SICA), the Recovery of Debts due to Banks and Financial Institutions Act, 1993 (RDDB Act) and the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI).

Different agencies

“As a result, four different agencies — High Courts, Company Law Board, the Board for Industrial and Financial Reconstruction (BIFR), and the Debt Recovery Tribunals (DRTs) — have overlapping jurisdiction. This tends to cause delays in the process. A well-drafted bankruptcy law can overcome these challenges,” he says.

A resolution time of 180 days, as proposed under the new Bankruptcy Law, should also give banks leeway to secure a significant portion of the receivables. “Most banks prefer to be secured creditors and would have disbursed loans against receivables or inventory.

By the time the recovery proceedings can be initiated by the bank, the value of these receivables/ inventories or assets tend to depreciate significantly in value, leading to poor recovery for the banks under the existing system,” says Karthik.

Under the proposed Bankruptcy Law, lenders also do not have to wait until a loan is declared as stressed or to has turned bad to trigger the process of financial and other re-structuring. “They can take action at the early stages when stress is observed, such as when a financial default occurs,” adds Kathik.

The new resolution process also involves resolution professionals who will work along with a committee of creditors, thereby giving creditors a say in the process.

The other interesting aspect is that the code allows the corporate debtor itself to initiate the insolvency-resolution process once it has defaulted on a debt.

“It is a huge benefit for the economy as a whole. It allows room for shutting down a business if things go wrong. So, an entrepreneur is given a chance to move on and lenders are also paid off,” says Jaideep Iyer, Group President - Financial Management, YES Bank.

Inefficacy of DRTs

Often  liquidating assets to pay off debt is also delayed because banks are unable to agree among themselves regarding the sale of the assets.

The new code designates the National Company Law Tribunal (NCLT) and DRT as the adjudicating authorities for corporates and individuals, respectively, for resolution of insolvency. This can help reduce conflicts between lenders.

“If there is a bankruptcy code which is properly drafted and allows both lenders and borrowers to ensure that the insolvency resolution happens in 180 days then it is a huge positive for the banking sector. That along with strategic debt restructuring and other tools will help banks reduce the stress on their balance sheets,” says Iyer. He adds that under the existing structure the resolution gets dragged on for infinity. The existing DRTs are also not effective due to lack of expertise and staffing.

(2) Procedure for Judges’ Appointments     


The following news item is self explanatory:-


Saturday, 19 December 2015 | PNS | BHUBANESWAR | in Bhubaneswar


Democracy has taken roots in India because of its Constitution and strong judiciary, said former judge of Orissa High Court Justice AS Naidu said on Thursday.

“India’s Constitution is one of the best in the world and its judiciary unbiased and strong. This has helped the country remain strong in spite of its diversity,” he observed at Legal Spectra- 2015, the 3rd All India Legal School Meet organised by the SOA University.

The fact that the Indian Constitution has undergone many amendments only points to the fact that the Constitution is living and not static, he said, adding that several landmark judgements of the Supreme Court have helped the country’s thought process.

Advocate General Surya Prasad Mishra and Utkal University of Culture Vice-Chancellor Prof Debendranath Jena attended the programme as guests of honour. Former OUAT Vice-Chancellor Prof DP Ray of presided.

Students representing ten law schools from across the country are participating in the four-day meet.

Justice Naidu referred to ten landmark judgements of the apex court which included the Keshavananda Bharati case, the Shahbano case and the Indira Sawhney case saying they redefined the path that India needed to pursue. Law students must be aware of such judgements, he said.

The Keshavananda Bharati judgement, he said, held that the Parliament can amend any part of the Constitution as long as it does not alter the basic structure of the Constitution. In the Shahbano case, the court awarded alimony to a Muslim woman after divorce even when the Personal Law was against it.

The other cases he referred to included the right to life case involving Maneka Gandhi, the Olga Telis case, the Union Carbide case, the Nirabati Behera case concerning custodial violence, judicial appointment case, the Visakha case and the Aruna Shanbaug case.

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DRT Solutions Weekly Mail – 396th Issue dated 18th December ’15

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(1) Procedure for Judges’ Appointments     


The following news item is self explanatory:-

Supreme Court leaves it to Centre to draft procedure for judges’ appointments

The final order reaffirms the primacy of the CJI, and at the same time abstains from issuing directives that had to be binding also on the CJI and the four seniormost judges in the collegium.

 Written by Utkarsh Anand | New Delhi | Published:December 17, 2015 1:47 am


Exactly two months after it quashed the proposed National Judicial Appointments Commission (NJAC), the Supreme Court on Wednesday refrained from issuing any positive directive to improve the collegium system and left it to the Centre to consult the Chief Justice of India for drafting a new memorandum of procedure for judges’ appointments.

Listing out “only broad suggestions for consideration”, a constitution bench led by Justice J S Khehar agreed with Attorney General Mukul Rohatgi that preparing a memorandum of procedure for appointments in the higher judiciary fell in the executive’s domain, and the nine-judge benches had also left the task to the government.

The nine-judge benches in Second Judges and Third Judges case in the 1990s had accorded primacy to the Chief Justice of India in making judicial appointments so as to ensure independence of the judiciary while assigning to executive the bureaucratic task of drafting the memorandum of procedure in terms of its directions.

On Wednesday, the five-judge bench also clarified that there has to be “faithful implementation of the principles laid down in the Second Judges case and the Third Judges case” in case the new memorandum is drafted. It connotes that the government will have no leeway to introduce any element of surprise in the memorandum since it will have to pass the CJI’s muster, besides conforming to other principles enumerated in the 1990s rulings.

“The Government of India may finalise the existing memorandum of procedure by supplementing it in consultation with the Chief Justice of India. The Chief Justice of India will take a decision based on the unanimous view of the collegium, comprising the four seniormost puisne judges,” said the bench.

The CJI and four seniormost judges comprise the collegium, which has been persistently criticised for being opaque and lacking guidelines. While quashing by 4:1 majority constitutional amendment and the proposed NJAC, which was to replace the collegium system, the bench had embarked upon the ancillary exercise of improving the collegium as three of the five judges on the bench also criticised the existing system.

The Centre, state governments, lawyers’ bodies and petitioner lawyers such as Fali S Nariman and Anil Divan were heard by the constitution bench, which also comprised Justices J Chelameswar, Madan B Lokur, Kurian Joseph and Adarsh K Goel.

The final order reaffirms the primacy of the CJI, and at the same time abstains from issuing directives that had to be binding also on the CJI and the four seniormost judges in the collegium. Further, the bench sought to strike a balance with suggestions relating to eligibility criteria, procedural transparency, a secretariat of collegium and complaint redressal mechanism, although underlining that additional measures in the new memorandum must come “without sacrificing the confidentiality of the appointment process” and only in terms of judgments in Second Judges and Third Judges cases.

The new memorandum, the court said, may indicate certain eligibility criteria, such as minimum age of judges, and criteria for consideration along with the procedure to be made available on the website of the court concerned and on the website of the Department of Justice of the central government.

On transparency, the bench said minutes of collegium meetings along with dissenting opinion by judges on names may be recorded “while making provision for confidentiality of minutes consistent with the requirement of transparency in the system of appointment”.

For better management of the system of appointment of judges, the memorandum may provide for the establishment of a secretariat for each high court and Supreme Court and prescribe its functions, duties and responsibilities, said the court.


(2) Judiciary Space Issues     


The following news item is self explanatory:-

Stop-gap arrangements won't solve judiciary's space issues: Bombay HC

Monday, 14 December 2015 - 5:45am IST 


The High Court had recently directed the Union ministry of finance (MoF) to approach the Mumbai Port Trust (MbPT) with a proposal asking for land to accommodate the Debt Recovery Tribunal (DRT) and Debt Recovery Appellate Tribunal (DRAT). Additional Solicitor General Anil Singh and Advocate Mohamedali Chunawala, however, informed the court that MbPT has received 32 such proposals from various departments of the Maharashtra government and so the MoF proposal may not be decided on a priority basis.

The bench then said, "If the port trust has in its possession land on which some structures have been erected and constructed long time back, but presently unused and unutilised, then, the structures and the lands beneath can be handed over. Thereafter, the other ministries and departments in the central government can put up a court complex, wherein it would be possible to house the tribunals such as Debt Recovery Tribunal (DRT) and Debt Recovery Appellate Tribunal (DRAT). It is time that such lasting and permanent solution is found."

The court gave the direction while hearing a petition filed by Suraj Jadhav, who had approached the court highlighting the problems faced by the litigants after the Mumbai chairperson of DRAT proceeded on a medical leave since April and the charge was transferred to the Chennai tribunal. Only after the matter was filed in the High Court, the ministry appointed a full-time chairman for Mumbai.

Earlier, the president of the DRT bar association, Advocate Umesh Shetty, had told the court, "The DRT and DRAT are presently operating from one building in Ballard Pier. Collectively, the area used would be around 7,500 square feet. This much space is not sufficient for the functioning of the tribunal. Amenities such as water-coolers, sitting area, toilets are not available. Because of space constraints, complete digitalisation is not possible, delaying the uploading of judgements/orders."


DRT Solutions Weekly Mail – 395th Issue dated 11th December ’15

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


(1) Video Recording Court Proceedings


The following news item is self explanatory:-

 S Nambrath2015-11-300

The central government is awaiting feedback from the Supreme Court before expanding digitization of court proceedings by introducing audio and video recordings of proceedings.

The ministry of law and justice said that it has been getting suggestions that following the digitization of court documents, a move should be made to digitize and record entire proceedings.

At present, India follows the centuries-old custom of recording court proceedings by writing them down. A clerk types almost everything that is said in a courtroom by way of evidence.

However, with advancement in technology, it is now possible to record the proceedings, as is done in foreign countries, at virtually zero cost.

“The Government has been receiving suggestions for the implementation of audio-video recording of court proceedings. The issue has also been discussed in the meetings of Advisory Council of National Mission for Justice Delivery and Legal Reform,” the ministry of law and justice said.

However, said the ministry, the proposal has been deferred on the suggestion of the Chief Justice of India.

“In the meeting of eCommittee of the Supreme Court of India held on 8th January, 2014, Hon’ble the Chief Justice of India advised deferment of audio-video recording of court proceedings as this would require consultations with Hon’ble Judges of Supreme Court and High Courts,” it said.

Indian judges do not allow any recording devices to be brought into the court, though such restrictions have become nearly impossible to implement due to the possibility of recording using mobile phones, which are allowed.

However, no official recordings of court proceedings are allowed at present.

The policy of no-recording has also prevented the live broadcast of court cases involving subjects of national interest — such as corruption and politics — to the people.

In contrast, most of the proceedings of the Indian judiciary are accessible to the citizens via live broadcasts through dedicated channels.

Allowing the recording of court proceedings are expected to boost transparency and reduce allegations of impropriety.

In countries like the US, many states allow court proceedings to be recorded and broadcast. This has led to the emergence of channels such as Court TV, which specialize in covering interesting judicial cases.

India has a three-tier judiciary. At the lowest level is the trial courts, where evidence is introduced and evaluated.

After this, there are two levels — High Courts at the state level and the Supreme Court at the national level — where these judgments can be appealed.

While individual cases go through the three tiers, cases of public and national interest and those pertaining to governments and organizations can be filed directly in the High Courts or the Supreme Court.


(2) FIR Registration Must in Cognisable Offences 

The following news item is self explanatory:-

FIR Registration Must in Cognisable Offences'

By Express News Service

Published: 08th December 2015 04:39 AM

Last Updated: 08th December 2015 04:39 AM

HYDERABAD:  The Hyderabad High Court on Monday directed the DGPs of Andhra Pradesh and Telangana states to issue instructions to all the district police officers in their respective states to implement the law laid down by the Supreme Court in  registering complaints in cognisable and non-cognisable offences.

Justice P V Sanjay Kumar was passing this direction in a petition filed by V Mahindra and three others, challenging the action of the police in not registering their complaint.

The judge, in his order, said in view of the judgment of the Supreme Court in Lalita Kumari versus Government of Uttar Pradesh case, the registration of a FIR is mandatory under Section 154 CrPC, if the information discloses commission of a cognisable offence and no preliminary inquiry is permissible in such a situation. If the information received does not disclose a cognisable offence but indicates the necessity for an inquiry, a preliminary inquiry may be conducted only to ascertain whether a cognisable offence is disclosed or not. The preliminary inquiry should be made time-bound and in any case it should not exceed seven days and the police authorities are bound to follow the due procedure laid down in Section 155 CrPC. In any event, the police authorities must take suitable action in the matter expeditiously.

The Supreme Court has also said that since the general diary/station diary/ daily diary is the record of all information received in a police station, all information relating to cognisable offences, whether resulting in registration of a FIR or leading to an inquiry, must be  reflected in the said dairy and the decision to conduct a preliminary inquiry must also be reflected therein.

Reiterating the Apex Court order, Justice Sanjay Kumar said that in cases where the preliminary inquiry ends in closing the complaint, a copy of the entry of such closure must be supplied to the first informant forthwith and not later than one week disclosing the reasons in brief for closing the complaint and not proceeding further.

While making it clear that a police officer cannot avoid his duty of registering a FIR if a cognisable offence is disclosed, the judge recalled that the Supreme Court held that action must be taken against the erring officers who do not register the FIR if information received by him discloses a cognisable offence.

The judge disposed of the case directing the DGPs of both the states to issue instructions in this regard to all the police officials in their respective states.


DRT Solutions Weekly Mail – 394th Issue dated 5th December ’15

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


(1) New SC Chief Justice      


The following news item is self explanatory:-
What you must know about new CJI Justice Tirath Singh Thakur


Senior-most Supreme Court judge Justice Tirath Singh Thakur was today sworn in as 43rd Chief Justice of India by the President Pranab Mukherjee in Rashtrapati Bhavan. The 63-year old Justice Thakur took oath in the presence of Prime Minister Narendra Modi, NDA ministers, opposition leaders and former Chief Justices. Justice Thakur's mother Saraswati Thakur and other family members were also present at the function along with Attorney General Mukul Rohatgi.

Justice T.S. Thakur's appointment as the highest-ranking judge in the Supreme Court of India, is a clear sign that seniority reigns in the highest judiciary. Justice Thakur took over the charge from Justice H L Dattu who retired yesterday. It was former CJI Dattu who had recommended the name of Justice Thakur as his successor.

CJI holds the highest judicial position in the country as well as presiding in the Supreme Court. He/She also heads its administrative functions.

Though there is no specific provision to appoint CJI, it is a convention that the current CJI recommends a name to the government as his successor. Subsequently, it is the Law Ministry that clears his name and then the file travels to the Prime Minister's Office. Finally, it reaches to the President and he gets appointed after the President gives his nod.

Let's take a brief look at Justice Thakur's personal background, his life and experience!  

Justice T S Thakur is the son of D.D. Thakur who was an eminent advocate in Jammu and Kashmir High Court. D.D. Thakur later became the judge in HC and then the Union Minister. Born at Batroo in Ramban district on January 4, 1952, Justice Thakur started his legal practice in his father's chamber in the Valley state. He was a quick learner and went on to represent as Pleader in many cases. Justice Thakur plays badminton regularly to de-stress himself.

In 1990, Thakur was appointed as a senior advocate and invited to the Bench as an additional judge of the J&K High Court. Before being designated as acting Chief Justice of Delhi HC in 2008, Thakur served as judge in HCs of Karnataka and Delhi. At the time of his rise to the Supreme Court in Nov 2009, Thakur was serving as the Chief Justice of the Punjab and HaryanaHigh Court. Notably, Justice Thakur would have a year-long tenure as CJI before he retires in Jan 2017.

Justice Thakur is known for his patience, elaborated and fair hearings of cases. Famed for taking measures to clean the cricket administration, Thakur handled the Indian Premier League spot-fixing and betting case. His bench ordered to constitute a Supreme Court committee headed by Justice RM Lodha to make the world's affluent Cricket body BCCI, transparent and accountable.

While handling the case of Saradha chit fund scam, his bench ordered a CBI investigation in the case. It brought much shame to the Mamata Banerjee administration in West Bengal. Thakur is also hearing bail applications of the accused in the multi-crore National Rural Health Mission (NRHM) scam.

Moreover, Justice Thakur also leads the bench hearing Sahara-SEBI clash. It is making Sahara Group to return Rs. 36,000 crore back to investors allegedly duped for money.

Justice Thakur is famous for his meaty observations. It was him only who reminded BJP administration of its pre-election promise to clean River Ganga. Taking a dig at the government he had once said that, "It would probably take them (government) another 200 years to do the job."

(2) Banks worried over Recovery of Bad Debts      


The following news item is self explanatory:-

Recovery of bad debt worries banks

Sidhartha, TNN | Nov 30, 2015, 02.53AM IST

NEW DELHI: Almost 15 years ago, Daewoo filed for bankruptcy and a few years later General Motors took over its auto business. More than a decade later, while the Chevrolet Spark, which replaced the Korean chaebol's Matiz, can still be spotted on the road, its Indian plant lies in a shambles. Asset Reconstruction Company (India), or Arcil, which used to spend around Rs 5 crore for maintaining the facility near Noida, is still dealing with legal cases as a plan to sell it didn't materialize. 

Over a thousand kilometres away in Jharkhand, lenders are trying to get the local administration and the state government to protect their interests in loans they had extended to a Rs 5,000-crore power plant, which remains under construction and has even hit equipment vendor Bhel that has a Rs 800-crore exposure. With no support from the state, locals and unpaid vendors are taking away pipes and other material from the under-construction facility. 

While there has been a slowdown in fresh accretion to the pile of bad debt of banks, which added up to Rs 3.14 lakh crore at the end of September, recoveries have dwindled, exaggerating the pressure.
 A document prepared for a recent meeting of bank chiefs with finance minister Arun Jaitley had noted that "the situation requires special focus in banks like Bank of India, IDBI, Indian Overseas Bank, Bank of Maharashtra, UCO Bank, and United Bank of India". At least two lenders — BoI and IOB — have reported losses, while Dena Bank is just sitting on the edge. 

Over the years, thanks to persuasion by the Reserve Bank of India and the finance ministry, banks have become more transparent about recognizing non-performing assets. But there has been little improvement when it comes to recovery, bankers admit. "The economic environment is poor and companies are over-leveraged. So, even if we want to sell an asset, we are not getting buyers or the right price," said a senior executive. 

But the bigger issue is the challenge posed by defaulters, who approach multiple legal forums to delay the process of banks initiating action. No one illustrates it better than Vijay Mallya and the defunct Kingfisher Airlines, which approached several courts to avoid getting the "wilful defaulter" tag. Mallya is not the only one indulging in "forum shopping". "It is for the courts to recognize that. If someone is using the legal options to delay the process, we can't do much — courts need to take that into account," said a senior government official. 

There is a problem with the infrastructure at the debt recovery tribunals too, something that thefinance ministry is trying to fix. In fact, sources said, it is looking if the adjournments are too frequent and why people are unwilling to join. 

While minister of state for finance Jayant Sinha had told TOI that a fund is being planned to deal with impaired assets that can be revived, asset reconstruction companies believe that the legal framework too needs to be strengthened, and they have not been consulted on this.


DRT Solutions Weekly Mail – 393rd Issue dated 20th November ’15

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


(1) SC asks UP to Pay Compensation of Rs 10 lakh to an Officer      


The following news item is self explanatory:-

Supreme Court asks UP to pay forest officer Rs 10 lakh

Bhadra Sinha, Hindustan Times, New Delhi  Updated: Nov 18, 2015 12:29 IST




The Supreme Court has ordered the Uttar Pradesh government to pay Rs 10 lakh to a retired Indian Forest Service officer after being falsely implicated in a corruption case. The officer fought a legal battle for 10 years after a case was allegedly registered because he refused to comply with the instructions of the then chief minister in 2003.

Though the top court does not entertain petitions filed directly before it seeking compensation, it did so in this case after noting that the circumstances were very peculiar. A bench headed by justice Ranjan Gogoi said it was necessary to protect an honest public servant not only in his interest but in the larger interest of the society. Ram Lakhan Singh, the court held, should be compensated for the harassment and mental agony he underwent during the protracted battle.

“Some upright officers resist corruption but they cannot alone change the system which victimizes them through frequent punitive transfers, threat to their families and fabricating, foisting false cases,” the bench noted.

“In such a scenario, until and unless we maintain a fine balance between prosecuting a guilty officer and protecting an innocent officer from vexatious, frivolous and mala fide prosecution, it would be very difficult for the public servant to discharge his duties in free and fair manner. The efficiency of a public servant demands that he should be free to perform his official duties fearlessly and without any favour,” stated the court, adding there was a dire necessity is to fill in the existing gap by protecting the honest officers while making the corrupt officers realize that they are not above law.


(2) TS Thakur appointed as Chief Justice of India    


The following news item is self explanatory:-

Last Modified: Thu, Nov 19 2015. 02 45 AM IST

TS Thakur appointed 43rd Chief Justice of India


Thakur will take over from incumbent Chief Justice HL Dattu on 3 December; he has been a judge of the apex court since November 2009

New Delhi: Justice T.S. Thakur has been appointed the 43rd Chief Justice of the Supreme Court of India, an official statement said on Wednesday.

Thakur will take over from incumbent Chief Justice H.L. Dattu on 3 December. He has been a judge of the apex court since November 2009.

Thakur was head of the bench that delivered the popular verdict on the controversies surrounding the Indian Premier League and initiated administrative reforms within the Board of Control for Cricket in India.

He has also been hearing cases such as those on Sahara chief Subrata Roy’s custody, the probe into the Saradha chit fund scam, the National Rural Health Mission scam in Uttar Pradesh, and the legality of allowing broadband licence holder Reliance Jio Infocomm Ltd to offer voice services.

Thakur recently headed the two-judge bench, which refused to entertain a plea filed against a Bombay high court order staying the decision to ban sale of meat in Mumbai during a Jain festival.

Thakur will now head the next collegium of the Supreme Court with numerous reforms being suggested to the process of making judicial appointments.

Attorney General of India Mukul Rohatgi, who was asked to draft a new memorandum of procedure for appointment of apex court and high court judges on Wednesday, said he would furnish the same within 15 days.

There are, at present, four vacancies of the Supreme Court that will have to be decided by the collegium after Dattu’s retirement. Under the collegium system, a group of five seniormost Supreme Court judges appoints other judges to the higher judiciary—the high courts and the Supreme Court. Articles 124 and 217 of the Constitution stipulate that judges will be appointed by the President of India after “consultation” with the Chief Justice of India and other judges.

On 5 November, a five-judge bench of Supreme Court headed by Justice J.S Khehar clarified that there is no bar on the collegium appointing judges to the top court. This bench recently declared the Constitution (Ninety-ninth Amendment) Act, 2014, and National Judicial Appointments Commission (NJAC) Act, 2014, unconstitutional.

The NJAC was to replace the collegium system of appointment of judges, with the selection being made by a panel consisting of the Chief Justice, two seniormost judges of the apex court, the law minister and two eminent persons to be appointed by a select committee of the prime minister, Chief Justice and the leader of the opposition.

Born 4 January 1952, Thakur will have tenure as Chief Justice of a little over a year and retire on 3 January 2017. Thakur was designated as a senior advocate in 1990. On 16 February 1994, he was appointed as an additional judge of the Jammu and Kashmir high court and transferred as a judge of Karnataka high court in March 1994. He was appointed as a permanent judge in September 1995 and transferred to the Delhi high court in July 2004.

Thakur was appointed acting chief justice of the Delhi high court on 9 April 2008 and on 11 August that year, he took over as chief justice of the Punjab and Haryana high court.

Thakur is currently the only judge to use a microphone during proceedings of the Supreme Court and is also the executive chairperson of National Legal Services Authority, which provides free legal services to the poor.

Senior advocate Prashant Bhushan welcomed Thakur’s appointment. “He has always been a quiet, unassuming and judicious judge, and I expect his tenure to be a fruitful one.”

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DRT Solutions Weekly Mail – 392nd Issue dated 13th November ’15

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


(1) Liberalism in India    


The following news item is self explanatory:-

Liberalism in India

NOVEMBER 12, 2015


The origin of Liberalism in India has its moorings in the Western and Continental liberal philosophers, and contributed to the rise in nationalism against the British domination. Over a period of time, the liberal movement in India evolved, with the emergence of inter-dependence of economic development and political stability.

Post-independence, liberal ideas have contributed to India’s constitutional and political development, protecting values such as freedom of expression, democracy, human rights and secularism to name a few.

An article discussing classical liberal ideas and their proponents in India over the last century has been documented which highlights the evolution of liberalism in India, right from its inception to its modern day manifestation.

P. Manish, Assistant Professor of Economics in the Sorrell College of Business, Shruti Rajagopalan, Assistant Professor of Economics at Purchase College, State University of New York, Daniel Sutter, Professor of Economics at Troy University, and Lawrence H. White Professor of Economics at George Mason University have contributed to the article.

Intellectual currents before 1947:

In the 19th century India, prominent intellectuals like were influenced by British and Continental liberals. The liberals who supported individual rights and freedom founded the Indian National Congress Party in 1885. But with the passing of time and also of liberal leaders, the Indian National Congress lost its liberal character, replaced by the new generation of Congress leaders with socialist ideologies, the most important of them being Jawahar Lal Nehru.

“Whereas the liberal Whig philosophy of the 18th century profoundly influenced the founding and set the early course of an independent United States, the democratic-socialist philosophy of the late 19th century profoundly influenced the founding and set the early course of an independent India.”

A Congress Socialist Party, headed by Nehru and made up of socialists and planning enthusiasts was formed in 1934 which organised a National Planning Commission in 1938, to determine the role state planning could play in the growth of the nation.

The liberal critics of planning (1950-1975):

At a time when intellectuals and politicians in India and in the world believed that centralised resource allotment was the way to ensure growth and development, a broader movement opposed to planning in the civil society emerged, backed by liberals such as economist B. R. Shenoy, C. Rajagopalachari, Minoo Masani, Khasa Subba Rao, A. D. Shroff, and Nani Palkhivala.

Rajagopalachari, who was the Governor General of India from 1948- 1950, had labelled Nehruvian socialism as a “permit–quota– license raj,” a new kind of oppression following on the heels of the British Raj. He formed the Swatantra (“Freedom”) Party in 1959 to provide opposition to Congress. Its founders formulated 21 principles emphasizing a goal of protecting individual liberty and limiting government. Rajagopalachari also founded the Swarajya -an English language weekly magazine in 1956, to discuss current economic and social policy in the context of individual freedom and economic liberty.

The Constitution of India was frequently amended during 1950–1978, the peak era of socialism, to accommodate policies to salvage the Five Year Plans. As a senior advocate in the Indian Supreme Court, Nani Palkhivala argued some of the most important cases affecting the constitution and the rule of law in India, who also described this amendment process as the systematic defiling and defacing of the Indian Constitution.

Liberals abroad oppose statism in India:

From 1975 and the Emergency, the years under Indira Gandhi were characterised by the almost complete disappearance of liberal ideas within India. However, opposition to statism in India came from figures at institutions abroad.

Jagdish Bhagwati, an economist, experienced an “intellectual conversion” around 1962 in favour of free trade and against the protectionist policy and the associated ‘permit–quota–license raj. Bhagwati co-authored books with his wife Padma Desai and T. N. Srinivasan criticising the central planning system and licensing regime. He moved to MIT in 1968 and later to Columbia, and Srinivasan relocated to Yale in 1980 but continued to push for liberalising reforms. Extending their critique, Arvind Panagariya- an Indian-American economist and Professor of Economics at Columbia University in his influential book India: The Emerging Giant, lays out a roadmap for reforms in different sectors of the economy.

Re-emergence of a liberal movement in 1991:

India witnessed a revival of the liberal movement in 1991, especially in the English-language business press and in policy circles. Parth J Shah, an Austrian school economist, and head of the Center for Civil Society (CCS) a liberal think tank in New Delhi is considered as one of the key figures in this revival.

CCS conducts outreach programs for students and advocacy to promote greater individual choice. It has also made commendable efforts to rekindle public interest in the Indian classical liberal tradition by making the works in this domain publicly available on IndianLiberals.in.

The works of Gurcharan Das and Sauvik Chakraverti have also added due weightage to the criticisms of statism in India and its undesirable consequences on the economy.

Explaining the deficiency of liberalism in the Indian academy:

To address the paucity of liberalism in the Indian academy, the authors have mentioned:

“Throughout the era of central planning as well as during the years of economic reform the liberal philosophy had a very minimal presence in the halls of Indian academia. Almost all the academics who hailed from India and were influenced by liberal ideas have pursued their careers and their research in universities abroad. This section seeks to outline a possible explanation for this dearth of liberal academics in India.”

Also for the sole aim of professional growth, economic theories supporting the government’s policies were advocated for by the economists. The profession itself was being indirectly influenced due to increasing government dominance over public universities and higher education institutions.

(2) Need to Create New SC Benches    


The following news item is self explanatory:-

Time to Examine the Need to Create New SC Benches

By B Vinod Kumar

Published: 11th November 2015 06:00 AM

Last Updated: 11th November 2015 03:18 AM


A long-pending debate has finally begun on reforming the Indian judiciary. This is the right time to re-examine one suggestion that has been repeatedly made but has not garnered the attention it deserves. This is the recommendation that new benches of the Supreme Court be created —  made by the Parliamentary Standing Committee on Home Affairs in its 56th, 61st and 72nd reports, the Committee on Law and Justice in its 2nd, 6th, 15th 20th, 26th and 28th reports and the Law Commission in its 95th, 125th and 229th reports. They have asked for the creation of three new “Cassation benches” of the Supreme Court which would be in the North-Eastern, Western and Southern regions of the country.

These could handle civil and criminal appeals arising out of the orders/judgments of the High Courts and the main bench in New Delhi could focus solely on constitutional matters. This way the workload would be better divided and case disposal rates would increase. The biggest argument in favour of this reform is the tremendous relief it would bring to the citizens of the country. Currently, one has to travel all the way to New Delhi, incurring huge expenditure on conveyance, lodging and work days lost. Then, there is the general practice of bringing along one’s own lawyer, who has handled the case in the High Court, to the Supreme Court which further increases the cost. Adjournments are common and they add to the overall expense.

During the Telangana agitation, several cases were filed in the Supreme Court and mobilising funds for them was a herculean task as their legal expenditure ran into lakhs of rupees.

The burden on the common citizen due to this inefficient system is too well-known to elaborate and having benches in the four corners of the country would bring tremendous relief to the citizens who could access justice closer to home. For this reason, the demand has been persistently raised. It is, therefore, highly unfortunate that the Full Court of the Supreme Court has persistently opposed this reform through resolutions passed in 1999, 2001, 2004 and 2006. The most recent opposition was in 2010 when a Full Court of 27 judges, headed by former Chief Justice KG Balakrishnan, passed a resolution that reiterated the position that dividing the Court would undermine the country’s unitary character and would destabilise the Court’s integrity. This is an assertion and not an argument. The Full Court has never explained to the government how such a move would undermine the country’s unitary character or destabilise the Supreme Court. Further, such a ‘unitary character’ does not exist as India is a federation. As per Article 1 of the Constitution, India is a Union of States.

This elementary fact seems to have been lost on the Court. It also flies in the face of its own basic structure doctrine, which regards federalism as part of the basic structure of the Indian Constitution. It is also misleading to say that dividing the Court would destabilise it. It is like saying that dividing the country into more states would destabilise its integrity.

As experience has shown, creating new states such as Telangana, Uttarakhand, Mizoram, etc have actually helped in addressing legitimate issues and have made the country stronger and more united. Similarly, creating new benches of the Supreme Court, far from ‘destabilising’ it, will actually enable it to perform its duties more efficiently, bring it closer to the common citizen and increase its overall legitimacy.

Implementing this reform only requires the support of the Chief Justice of India. As per Article 130 of the Constitution, “The Supreme Court shall sit in Delhi or in such other place or places, as the Chief Justice of India may, with the approval of the President, from time to time, appoint.” However, despite the best attempts of the government to persuade it otherwise, the Supreme Court has remained resolutely opposed to this vital reform.

This is truly unfortunate as the Court has chosen to ignore the daily hardships of millions and in the name of vague and sentimental principles obdurately enforced the status quo. This leaves the government with only one choice — amending Article 130.

The government must bring in amendments, which take away this power from the Chief Justice and give it to the President alone. This is also the recommendation of the Law Commission. However, this will be a long-drawn process as it will require special majorities in both Houses and ratification by the state legislatures. The outcome will be humiliating for the Supreme Court and it could well be remembered as an institution that resisted reforms and required external intervention for change.

Thus, the simpler way out which is also face-saving for everyone is if the Court recognises the need for creating new benches and agrees to do so. The Supreme Court like all institutions under the Indian Constitution is a dynamic and living entity and must adapt to the needs of the times to stay relevant.  It is with this foresight that the framers of the Constitution drafted Article 130 that gave the Chief Justice of India the power to create new benches beyond the national capital. Let us hope the judiciary honours their wisdom and lets prudence prevail.


Weekly Mails are DRT Legal Guide and gold mine of practical information for the borrowers and guarantors – The mail recipient particularly Borrowers and Guarantors will be immensely benefited by our weekly mails and DVDs, all previous issues of weekly mails from 1st one till the last one may be viewed by clicking the links given at the top. Separate web pages have been created to contain these mails in batches of 10 so that pages open up fast. These mails are gold mine of information on current topics giving lot of practical suggestions and comments. Any new recipient to these mails must go through all the weekly mails right from the issue no 1 to the latest. If possible please spread the reference of our web site and the weekly mail among the persons, borrowers and guarantors who are the bank victims. If anyone desires to get these mails regularly, he may write to us for inclusion of his e-mail ID in the regular mailing list. The weekly mail is issued on every Friday. The particular issue of the weekly mail is first published on the web site and then mailed to borrowers, guarantors and their advocates in the country. This service is free in the best interest of society in general and litigant borrowers and guarantors in particular. We are getting huge no of mails appreciating our weekly mails.  We welcome suggestions.

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DRT Solutions Weekly Mail – 391st Issue dated 6th November ’15

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(1) Bankruptcy Panel calls for Insolvency Regulator    


The following news item is self explanatory:-


Bankruptcy panel calls for insolvency regulator


A government-appointed committee has suggested setting up an insolvency regulator to exercise regulatory oversight over insolvency professionals and agencies in a bid to ensure speedier winding up of insolvent companies and providing easier exit route to investors.

The Bankruptcy Law Reforms Committee (BLRC), headed by TK Vishwanathan, in its report has also recommended, for the first time, bankruptcy and insolvency processes for individuals with annual gross income of less than Rs 60,000 and aggregate assets of not more than Rs 20,000. They can apply for a discharge from their debts which are liquidated and unsecured up to Rs 35,000.

The proposed Bankruptcy Code will replace over a century old archaic insolvency act — The Presidency Towns Insolvency Act, 1909 — and ensure time-bound disposal of insolvency application.

“The Bill seeks to improve the handling of conflicts between creditors and debtors, avoid destruction of value, distinguish malfeasance vis-a-vis business failure and clearly allocate losses in macroeconomic downturns. The Bill lays down a clear, coherent and speedy process for early identification of financial distress and revival of the companies and limited liability entities if the underlying business is found to be viable,” an official statement said. According to the draft, a timeline of 180 days has been prescribed for dealing with applications for insolvency resolution which can be extended for 90 days by the adjudicating authority, though only in exceptional cases. The draft Bill also provides for a fast track insolvency resolution process which may be applicable to certain categories of entities. In such a case, the insolvency resolution process has to be completed within a period of 90 days from the trigger date. However, on request from the resolution professional, based on the resolution passed by the committee of creditors, a one-time extension of 45 days can be granted by the adjudicating authority. According to World Bank, creditors in India recover 25.7 cents on the dollar in 4.3 years compared to 2.6 years in South Asia where one can recover 31.8 cents a dollar while in the US, 80.4 cents a dollar in 1.5 years, due to absence of clear bankruptcy guidelines. Earlier, the government had though enacted the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest (Sarfaesi) Act to ensure that banks get a preference over other stakeholders in settling of dues, India lacks an effective over-arching mechanism to ensure quick winding up of businesses and compensation to other stakeholders. According to the Presidency Towns Insolvency Act, an individual can face charges for non-payment of as little as Rs 500. “The adjudicating authority will have the jurisdiction to hear and dispose of cases by or against the debtor. The Debt Recovery Tribunal shall be the adjudicating authority with jurisdiction over individuals and unlimited liability partnership firms. The National Company Law Tribunal will have jurisdiction over companies, limited liability entities,” according to the draft. The resolution professional will investigate and prepare a final list of all qualifying debts within 180 days from the date of application after which the adjudicating authority will pass an order on discharging of the debtor from the qualifying debts and accord an opportunity to the debtor to start afresh, financially.


(2) Supreme Court Burdens    


The following news item is self explanatory:-

M J Antony: Burdens the Supreme Court must shed

The power of judicial review is being stretched to breaking point

M J Antony November 3, 2015 Last Updated at 21:48 IST


The Supreme Court of India is said to be the most powerful court in the democratic world. It showed in recent weeks that it could strike down a Constitution Amendment ratified by 20 states, and 'legislate' to devise a collegium system not found in the Constitution. On inviting suggestions to refurbish the collegium, Union Minister Arun Jaitley's jibe was that the court was acting as the constituent assembly.

Despite 65,000 cases in arrears, the court has enough adrenaline to consider issues such as ban on Sardarji jokes on websites, polygamy among Muslims and creating a safe corridor for wild elephants crossing rail lines. However, a visit to the court or reading its judgements would make one wonder whether it is a constitutional court at all. The long-winded arguments droning on in the 14 courtrooms are mostly over civil disputes of distant past involving land, revenue, disciplinary proceedings against employees, interpretation of wills and other mundane subjects, which should have ended in courts below.

In some recent judgements, the court itself has observed that there should be some end to disputes over facts and it should not be dragged to the constitutional court. Last month, it stated in the judgement, Ram Bahal vs deputy director of Consolidation, that "appreciation or re-appreciation of evidence must come to a halt at some stage of the judicial proceedings and cannot percolate to the constitutional court, exercising jurisdiction under Article 136 of the Constitution."

This provision of the Constitution allows any losing party to approach the Supreme Court even without the mandatory certificate from the court that delivered the judgement. The apex court has discretion to reject such
 special leave petitions (SLP) at the threshold, but in fact scores of them are admitted in a normal week. This, despite the court itself having emphasised in several judgements that this discretionary power should be used only in exceptional cases when a question of a law of public importance is involved or the judgement appealed against shocks the conscience of the court.

The number of appeals entering the court through this gateway has exceeded by far the writ petition route. So much so that in another recent judgement, Leela Rajagopal vs Kamala Menon Cocharan, the court reminded itself that the jurisdiction under Article 136 is "highly circumscribed" and its use should be "highly economic". The first court might have determined the facts through evidence and examination of witnesses. The high court might have re-examined the evidence on record. Therefore, it is not for the Supreme Court to go through the facts "unless they give rise to questions of law that require a serious debate or discloses wholly unacceptable conclusions of fact, which plainly demonstrate a travesty of justice."

However, these precepts are not followed in practice. For instance, the list before the chief justice on Monday contained 72 cases, of which 48 were SLPs and 15 appeals. Only one writ petition was listed. The Ram Bahal case mentioned earlier started in 1974 and related to three plots of land in a village. Another recent judgement, Sant Ram vs Dhan Kaur, was an application for clarification of a 2009 order, involving a 1966 sale of 96 sq yards where a 14'/9' room was built illegally. In a tax appeal by the revenue authorities, the court found that the amount involved was so small that it was not worth even hearing, though the
 SLP was admitted long ago. These are only specimens; there are rows of them.

Public interest petitions (PIL), though they hog the headlines, take very little time of the court. Only a dozen out of more than a thousand cases heard in a week are PILs. Moreover, PILs benefit millions of people, who cannot approach the court directly.

The really undesirable outgrowth of the Constitution is the proliferation of SLPs, which are admitted and dumped in the record rooms till another generation of judges take them up. It might be true that the quality of judgements of the lower courts leaves much to be desired. But there should be some finality somewhere. Repeated review of disputed facts for decades benefits few except the second generation of original petitioners and lawyers. Or 3G.


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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.

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