Wednesday, August 10, 2011

Lawyer - THE HELPER in CASE LAW MAKING (!)


TG
Ombudsman for Legal Sector

Posted: 09 Aug 2011 06:32 AM PDT
Comment :
The following words, rich in soulful wisdom, of late N A Palkhivala, an eminent legal luminary of our times, may be worth recalling:
“In a vast democracy like India, many citizens are bound to be un-dimensional. But no Lawyer has any excuse for being un-dimensional. By his training and equipment and by his professional competence he is better qualified than the rest of the citizenry to take an active part in the making of laws and the formulation of public policies. He would be failing his country if he did not do this duty.
The lawyer has to act as a catalyst. The responsibilities, which today, lie on the shoulders of the lawyers, are far greater than at any earlier time in world history.”


The above quote from a published speech on the topic – ‘Sentinel of democracy’, delivered nearly four decades ago, is indisputably of greater relevance today than ever before; essentially so, regarding the importantly increasing role lawyers have to play in the making of case law by courts.
The same wishful thinking came to be aired by no less a person than a Finance Minister(if one remembers right, it was the former one), not long ago. As per a personal noting, the information gathered from a Press Report was that, in his address at the Silver Jubilee function of the Customs, Excise and Service Tax Tribunal, the FM said:
“We are concerned about the quality of government representation and looking into it. With globalisation, complexities of transaction will increase and it is important to have good quality government representation. Many judges have told me that the quality of their judgments was as good as the lawyers appearing before them,”
The reported proposal to appoint an ombudsman mooted by the men presently in governance may be, in a manner of speaking, considered as a right action aimed to ‘kick the ball’ that had been in the Government’s court.

Tuesday, August 9, 2011

Recent literature on an equally recent concept of wide concern- 'corporate governance'


icl Tuesday, August 9, 2011


Recent Literature on Corporate Governance


The literature is, going by one's understanding, centrally, albeit not explicitly, focused on, - the most crucial aspect namely, the role of  'human element'- its basically inherent  characteristics - strengths and weaknesses. Also on -  why, having regard to its overriding role in 'governance' , it is the most important of all to be borne in mind -suggesting, perhaps, that in the matter of framing policies, conceiving of , and to the end of bringing about, any legislation.

If such understanding is any where close to/fairly reflects the 'burden of the literature'- then the litetrature deserves to be commended as a 'holistic', may be the only possible, practical approach! -Subject, of course, to what view those 'experts' -particularly, the ones who happen to be on the same wave length- have to offer, to the discerning readers at large!


Related:
BL 10th - BSR
August 10, 2011

Two write-ups recently came to my notice, purporting to set out new, and even game-changing, approaches to management of organisations, with the aim of pulling them out of the ruts into which they...


Extract:

6.1   OVERVIEW




Good corporate governance is shaped by the complementary and interdependent efforts of all
stakeholders. The efforts of regulators in strengthening the legal and regulatory framework and
ensuring effective supervision and enforcement are just one part of the overall measures required to
strengthen corporate governance. Companies, shareholders and reputational intermediaries need
to step up their efforts in exercising their respective responsibilities for ensuring good governance.
In this context, self and market discipline must complement regulatory discipline to ensure integrity,
confidence and fairness in the markets.
Regulatory discipline is no substitute for the need for capital market participants to govern
themselves responsibly. The cost to the market of over-dependence on regulatory discipline can be
disproportionate to the benefits. It can result in regulations being overly prescriptive, additional costs to the market and may fester a box-ticking culture. For this reason the SC is always guided by
the principle that there should be no more regulation than necessary. This means however that
all stakeholders must make determined efforts to act responsibly and to pre-empt and mitigate
failures.
Market discipline must disincentivise poor corporate conduct through its assessment of corporate
performance as reflected in stock prices, bond spreads and credit ratings. Companies must embrace
the need for ethical practices, and directors must discharge their fiduciary duties by ensuring integrity,
transparency and accountability. Above all, shareholders must empower themselves to be more
assertive in demanding corporate accountability. Where there is failure in such obligation, action
must be taken.
Effective public and private enforcement reinforces self discipline as the real threat of legal action
compels companies to tighten their governance processes to ensure conduct consistent with the
law.   

Wednesday, March 30, 2011

LEGALIZING AN ILLEGALITY - A basically misconceived proposition


Posted by Jug Suraiya



vswami says:
March 30,2011 

'Figure it out, if you can'! - is seemingly a sincere suggestion.

Let one first figure these out: >


In our times, can one truly think of anything- so called illegality, left out, but remaining to be 'legalized'- whatever that means in any sense of it?
Is it not extremely amusing, or is tantamount to offending one’s own intelligence, for anyone to even imagine for a moment that, there is still any human activity having its 'epicenter' on ‘speculation’ –e.g. all forms of gambling, stock marketing, or the like, despite it verging on ‘illegality’, which has not been accepted , or not given a legal recognition, with an iota of conscience pricking?
-  If ‘No’, is not the suggestion to 'legalize' -by itself misconceived; rather a non-starter?


In our times, has anyone, including our men in governance, ever cared to draw even a thin line of distinction between, –
Right and Wrong (left!)
Literate and Illiterate (or should it be-literate illiterate, which is closer to reality)
etc. 

Saturday, March 26, 2011

Apartment AND Flat - Distinction between ? - (As updated on 15th April)



The write-up does provide useful guidance, though in broad terms, to buyers of ‘units’ of a building (s). What requires to be made a specially careful and insightful note of is, - the basic distinction in the legal characteristics of  the two types of units builders construct and sell – ‘flats’ and ‘apartments’. Further that, there are two separate special enactments – respectively governing the two types of units.

The readers’ comments, however, go to bear testimony to the sadly prevailing common misconception in the minds of buyers-community, of certain very crucial aspects having a bearing on ‘ownership’ and ‘enjoyment’ of the property – be it a ‘flat’ or an ‘apartment’.

Attention is invited to the following material available in the form of published articles, etc., with the fond hope that a close reading should be of help in understanding the subject in its proper perspective.

I. Articles published in the Karnataka Law Journal and Madras Law Journal, as per citations given below: –


(2003)(4) KAR. L.J.Pg.1
(2005)(3) KAR.L.J. pg.17
(2005)(5) KAR.L.J. pg.1
(2003) 3 MLJ Pg.5 (journal) 

II. Posts on websites:


February 10, 2010 at 3:46 pm


January 27, 2011 (reproduced:)


“COMMON AREAS AND FACILITIES”
WHAT IS CRYPTICALLY REFERRED TO AS, – “COMMON AREAS AND FACILITIES”  IS A SPECIALLY DESIGNED LEGAL CONCEPT. IT IS PECULIAR BUT ESSENTIALLY OF RELEVANCE AND IMPORTANCE TO – UNITS OF A BUILDING (‘IE. FLATS’ OR ‘APARTMENTS’). AS SUCH, IT IS IMPERATIVE FOR ONE AND ALL, WHO HAVE SOMETHING TO DO WITH A FLAT OR AN APARTMENT – BE HE A PROMOTER /BUILDER//SELLER, OR PURCHASER, OR THEIR PROFESSIONAL CONSULTANTS – EXPECIALLY THE ADVISING ARCHTECTS, AND LAWTERS , REQUIRE TO HAVE A CLEAR / IN-DEPTH UNDERSTANDING,. AND INSIGHTFUL GRASP, OF ITS PECULIAR LEGAL CHARACTERISTICS AND IMPLICATIONS. THAT IS POSSIBLE PROVIDED THERE IS AN UNBIASSED AND IMPARTIAL UNDERSTANDING / GRASP OF THE VERY BASIC CONCEPT OF – OF ‘FLAT’ / ‘APARTMENT’.
SHOULD ONE GO BY THE INFORMATION AVILABLE IN PUBLIC DOMAIN (IN THE FORM OF ARTICLES, REPORTS, POSTS ON WOES / GRIEVANCES, ETC.,) ONE IS LEFT WITH AN INDELIBLE IMPRESSION THAT, BY AND LARGE, THERE HAS BEEN JUST AN AWAKENING, BUT NO REAL AWARENESS ON THE PART OF THOSE WHO NEED TO BE REALLY CONCERNED ABOUT THE OBTAINING WOEFUL REALITIES."

http://www.mysooru.com/article1.html

For more of this kind, anyone intimately interested may usefully scout around and browse through other known websites. e.g.>


http://swayamsevak.tripod.com
http://www.livemint.com/2011/04/13235659/Sahara-firms-defy-ban-on-raisi.html?h=A1


(Comment posted in public interest, solely with the object of creating an incisive awareness) 

Friday, March 25, 2011

The ubiquitous PAN



81->90
The reasons adduced by the Revenue to the admitted failure of PAN are prima facie phoneys and in any case, could not be wholly true. It is a daring attempt to camouflage the realities behind, - mainly the obtaining serious deficiencies in the system in place, more so lack of  concerted ‘will’ for monitoring and strictly enforcing the so called ‘identity’ through PAN as the tool. But the supervening tragedy is that, in the nation’s populace there is only a minority endowed with ‘common sense’, if not profoundly ‘legal sense’. Further, even such minority, by and large, for self-cantered reasons or excuses, does not have the time or mind to ‘stand and stare’, much less to try and do something to the best of the individual or collective ability, towards bringing about any improvement in this or any other like matters of public interest.. 
The comment @ vijay, so also certain others have rightly pinpointed some of the common areas which require to be looked into for easily eliminating in fructuous or multiple PANs.
Another significant area of concern is – ‘demat accounts’, over which SEBI is expected to have direct and exclusive regulatory control. In this context, the following 2 articles published in Taxmann’s journal – Chartered Accountants Today may be found to provide some useful information:


'PAN' REQUIREMENT FOR DEMAT ACCOUNT HOLDERS (I)    (2006) 6 CAT 565

SEBI'S DIRECTIVES MANDATING 'PAN' REQUREMENT – (II)   (2006) 7 CAT 64

a COMMENT -in jest



‘WE’ - IN THE NEWS- NATURALLY  embraces BOTH ‘SEX’ – ‘MEN AND WOMEN’. 

Also, as is readily gathered, the ongoing research is quite a long drawn process, and the renowned planetary scientists  themselves may take years to arrive at even  any preliminary finding.

Nonetheless, in his write-up @   At least one female director please! 

its author says:

 “Different perspectives

   Men are from Mars and women are from Venus. ...”

The above quote bears on its sleeves the firm and unequivocal conviction of its ‘author’ over the matter, which is largely believed to be as yet at a nascent stage.

One is so provoked as to rush out of doors shouting in frenzy - ‘eureka’ ; 

and proclaiming full throatily - Here is The man who knew too much !

(‘In jest’)

Wednesday, March 23, 2011

Fetters on judicial powers under Jurisprudence / the Constitution

Ref. LcI post@ 

Law, not equity must prevail: SC

Does this not (?) bear out the one and only good and sane reason for justifying, -

the common perception that, - 

Our legal system is messed up, and is bound to continue to be so done, the entire blame being traceable to and resting with the unbending and unbound mindset of the species - 'vested interests'. 

So also, the  age old saying /belief that - 'LAW IS AN ASS'   


The reported SC judgment , last in the series, simply restates once again the long established rudimentary principle. As has been rightly emphasised time and again by the apex court, the adjudicatory powers of courts ought not to, under any pretext, more so donning the cloak of ‘equity', travel beyond the permitted realm of 'interpretation' in its profound sense. Saying it differently, courts cannot, under any circumstance, encroach upon the realm of 'legislation', which is the sole prerogative of the 'legislature'. Be that as it should, it is really deplorable that, one does come across instances, not infrequently, especially in recent times, appellate and court decisions being handed down in complete negation of the stated principle, which has its root in the country's constitutional law. No wonder, litigation has become growingly inevitable even in matters on which the governing law is loud and clear, or 'covered' on all fours by 'precedents'. There is no gainsaying that, amendments of, or tinkering with in any manner, any extant enactment, or rules or regulations, resorted to as a matter of course, off and on, by the legislative bodies, be they at the centre or in the states, at the instance of the 'executive', have been, as is the common perception, responsible, in no small measure, for the aforesaid state of affairs. 

Friday, March 18, 2011

A SCAM< A 31 STOREYS - TALL BLUNDER, SCRAPING THE SKY

Bombay High Court satisfied with progress in Adarsh case
By : rahul on 17 March 2011

   
Read comment on @ <

No doubt, there is merit in the old saying-'justice delayed is justice denied'. Even so, in today's scenario- thanks to the ingenuity of the (in)human mind, - every such or like matter entailing and having far-reaching impact / consequences against -'public interest', the emphasis should be on -'justice'(being rendered eventually),rather than so much on 'delay'; especially if that is unavoidable, and not unreasonable by any standard, in a given case. The magnitude of this 'scam' is too tall (36 (?) storeys high ?),the issues involved are too many, so warranting an in-depth cum multidimensional investigation. As such, the court, after all, is prima facie right in its remark - "Give them (CBI) some time. They are investigating,".. 












'A question of trust, a matter of faith' - Is it not so EVER?!


 A question of trust, a matter of faith - Bangalore Mirror ...
17th Mar '11 TOI - BM

“This judgement of the Bombay High Court will now be taken to the Supreme Court. There, hopefully, it will be left untouched, for this is a judgement that India both needs and deserves. “

To my mind, it seems that, the better propositions that call for an expert deliberation are, -
whether, at all, the case on hand,  which really is an ‘in-house fight’ needs or deserves to be taken in a further legal battle to the SC;
and  even it were, will not the SC have to firstly examine and decide, whether or not this is a fit case – ‘for the door of the court will be ajar’,  but  ‘not to be told off at the gates’.
(The words borrowed are  those of Krishna Iyer J – for a better appreciation of their true purport and  import, refer –Fertilizer Corporation Kamgar Union’s case AIR 1981 SC 344, 356 ).
For a wholesome appreciation of the matter, from all conceivable angles, however, the viewpoints  as expounded by one of the very few ‘humanitarian’  of our times  (‘Nani’ , so fondly known in elite circles), in his published writings and speeches, should be of real assistance.
Recommend to Read:
WE, THE PEOPLE
We, the Nation THE LOST DECADES
 (There are several of them which deal with the Constitutional aspects, so also of the supremacy of the apex court. As they are found spread over from ‘the start to the finish’, it may be found profoundly  interesting  and eminently useful  to the readers, if  purposively read through, without any attempt to choose)

Wednesday, March 16, 2011

'Independent' or 'Interdependent' - which is a better /wiser, rather the 'truthful', concept to choose and adopt?


CAci (16-3-11)
“However, after the scam of Satyam the reliability of Independent Director has came under question. There is lack of commitment, professionalism and clearity of liabilities of Independent Director. They are serving the role of friends of promoters.

The scam of Satyam was really an eye opener for the Government of India. If the concept of Independent Director is to be succeeded, the Government must move forward to break the nexus between the Independent Director and Promoters for that rules should be made and the Independent Director should be appointed by the Central Government of SEBI.”

Comment:
wsrt: the concluding para- Posers/points to ponder: 1. Apart from the 'govt', should not a- 'CS' who has a crucial role to play, and professional obligations/duties to 'discharge', in the conduct of the affairs of a corporate, also 'move forward' and strive and make his individual contribution, in a profoundly independent manner, so as to serve 'the society', to the best of his 'conscience', as is expected of him? 2. How any such suggestion to - make 'rules' or have IDs appointed by CG could at all help or go to 'cut the ice'? 3. Is it not now common knowledge, also commonly admitted premise that, in our times, the most incorrigible/obstinate obstacles faced, coming in the way to 'success' in such matters, are, lack, nay abject absence of- (a) will/commitment to 'comply'; and (b)'utmost sincerity' to implement and/or enforce - on the part of the corporate and the government, respectively??
For more: One may visit, to read stories - Indian Corporate Law Blogs. Sample @: 'Actions Against Independent Directors' (March 11, 2011); Also -

Sunday, March 13, 2011 Actions Against Independent Directors



Tuesday, March 15, 2011

Constitutional Law -Amendment of !?


 GST moves forward as Cabinet clears Constitutional Amendment Bill

krsrivats@thehindu.co.in
BL 16th Mar

"The introduction of goods and services tax (GST) system has moved a step forward, with the Union Cabinet on Tuesday giving its nod for introduction of a Constitutional Amendment Bill in Parliament."

This, for what one knows, marks a singular development of its kind- in the history of our 'constitutional law'.  

Without anyone bothering self or the others to go into the merits or otherwise of the proposed GST scheme as such, the entire focus as of now is that the proposal is by and large considered a step in the on-going exercise at 'simplification'.  

The 'step forward' having been accomplished by the 'UC' giving its 'nod', the Nation now simply awaits the final resolution; albeit with a 'mixed feeling' and 'thawing expectation' as to what is 'in store' ahead.

NOTE:


For Knowing More, in General, to read:

1. The constitutional law expert, late N A palkhivala’s   Speeches and Articles in which he has eloquently and eminently expounded the intricacies of our Constitution and its related issues, in the 2 Books-
    
 WE, THE PEOPLE
 We, the Nation THE LOST DECADES

2. The Law and Practice of Income Tax (latest, Ninth Edition, Vol I @ pages 4 to 9  )

3. http://www.legallyindia.com/wiki/Constitution_of_India#Changing_the_constitution
 (Changing the Constitution; also,Judicial review of laws)


Addendum:



The Hon'ble Supreme Court while deciding the case, observed as follows: -
"The service tax levied by reason of services which are offered. The imposition is on the person rendering the service. Of course, it may be indirect tax, it may be possible that the same is passed on to the customer but as far as the levy and assessment is concerned, it is the person rendering the service who alone can be regarded as an assessee and not the customer. This is the only way in which the provision can be read harmoniously.
The Hon'ble Apex Court further opined that ''The charge of tax is on the value of services and it is only the person who is providing service can be regarded as an assessee. The rules, therefore, cannot be so framed which do not carry out the purpose of the Chapter (Statute) and cannot be in conflict with the same.''

The above  needs to be closely studied  and understood, as that might help and bring to surface some materially valid points having a nexus to the subject topic; besides, on the lurking doubt whether the service provider is at all right in passing on, as a matter of routine,but left unquestioned,the burden of service tax to the 'serviced'.

KEY NOTE: As one may be aware, - income-tax is a tax on 'income', it is levied on the person who is in receipt or 'beneficiary' of it, it is he who is the 'assessee', accountable and liable to pay, and if instead,by virtue of a contract or arrangement, the tax otherwise payable/to be borne by the assessee comes to be passed on to / 'borne' by another,the assessee is liable to pay tax by applying the commonly known concept of - 'grossing up of income for tax'.

The point is prima facie a moot one. Nonetheless, it seems  worthwhile to seriously consider: - Why not, by the same token of logic, 'service tax' (so also 'GST', if and after it has come into force) passed on by the service provider (or 'seller'),to his 'serviced'('customer'), be regarded a 'benefit' and accordingly be treated as his 'income' and taxed as such in his hands? OR

- In the alternative, for achieving the same result,is there not scope for invoking the provision already on the statute- section 40 (ii) of the IT Act- or in any case, justification for suitably amending it.
May be, preferably,- this is, in one's perception,an aspect worth considering, to the end of introducing a suitable provision in the DTC Bill.

Caution:For a proper examination of action called for on the foregoing lines,it is imperative for one,- to make a close study of the plethora of court decisions on the scope / interpretation of the extant provision I.E. section 40(ii)- for useful clues, one may look up the expert commentary and case law in - Palkhivala's BOOK on INCOME TAX, u/s 40 (ii) and (iia);


UPFRONT,NONETHELESS,OUGHT TO KEEP IN FULL FOCUS ALSO THE LARGER 'ECONOMIC CONSEQUENCES' OF ANY SUCH ACTION, if were taken.

FOR OBVIOUS REASON,IN DOING SO,THE PROPOSED GST SHOULD NOT BE LEFT OUT BUT SHOULD DULY FIGURE IN / BE FACTORED.        
    


'NPAs' of Banks ? - Solace to STAKEHOLDERS

UPdates >



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How NBFCs rein in their bad debts

The economic slowdown has meant that non-performing loans of both deposit-taking and non-deposit-taking Non-Banking Financial Companies (NBFCs) have shot up over the past two years. But discipl... »



The borrower’s perspective

The regulatory environment has impacted cash flows and ability to service debt »



Main Dish:
Side Dish:
Spice - 
comments


Why should the stakeholders (SH) worry at all! (A) So long as they are safe in the hands of – past masters or grandmasters – skilled players of the games , be it, – ‘passing the buck’ or ‘blind man’s’ buff’ (or bluff)- in common parlance known as – economists, financial experts or analysts, so on and so forth - running into an impressive long list. (B) Should even all of them not put up a good show at any given point in time-  any way, SH are in the safe hands of our elected men in governance – in readiness ever to ‘bail out’ – albeit , in the ultimate analysis, out of the ‘common kitty’ of ‘the people’!!