Land Acquisition and Fair Compensation

If more than ten years is required to solve 75% cases than the current system has really failed and some immediate steps need to be taken.

• Specialist handling commercial disputes :

As per the new Bill, the Judges of commercial courts, commercial division, and the commercial appellate division shall have experience in dealing with commercial disputes. At present commercial matters are decided by Judges who may or may not may special knowledge of commercial matters. With more efficient and experience person dealing with commercial disputes, there will be satisfactory and legally correct orders and decrees which in turn would reduce the appeal to a higher court.

• Relief to investors :

With the liberalization of the Indian economy in the year, 1991 more foreign investment came to India. The last two decades saw a considerable change in Indian economy. With the increase in foreign investment, capture by foreign brands of Indian markets and expansion of economy gave rise to  more and more commercial dispute and increased commercial litigation. However the disposal of cases is at the same rate. This long pendency of cases causes huge problem to the investors. It takes years for the investors to get back the money involved in the litigation. Therefore with the  establishment of commercial courts these cases will be disposed of at a reasonable time limit.

• Reasonable cost of litigation :

As cases are disposed off during reasonable time limit the cost of litigation automatically comes down.

• Positive image of legal system among investors :

In 2014, the World Bank ranked India 142^nd out of the 189 countries investigated for the Ease of Doing Business Report, slipping further from the 2013 rank of 134. One of the biggest factors behind India’s reputation as a bad place to invest is the length and cost of litigation in the country and the proposal to introduce “commercial courts” has therefore been amongst the most important. These commercial courts or commercial divisions in high courts would be fast-track courts with hi-tech infrastructure for compulsory e-filing, digitizing of documents, and case-management conferences. They would resolve disputes in high-value commercial transactions in a speedy and efficient manner. All this would change the image of Indian economy and legal system in the minds of investor. Investors would have more positive approach towards Indian legal system.

• Economic growth :

Fast disposal of cases, low cost of litigation, positive image among investors, increased investment would definitely result in the growth of Indian economy.

• Collection and disclosure of data :

The said Bill u/s 18 provides that the Statistical data regarding the number of suits, applications, appeals or writ petitions filed before the Commercial Court, Commercial Division, or Commercial Appellate Division, as the case may be, the pendency of such cases, the status of each case, and the number of cases disposed of, shall be maintained and updated every month by each Commercial Court, Commercial Division, Commercial Appellate Division and shall be published on the website of the relevant High Court. This provision will work as a psychological reminder to the judges to dispose the matters and confidence among litigators about the speed of disposal of cases.

• Appeals from quasi judicial bodies :

The said bill u/s 14 also makes provision for appeal from orders and decree of various tribunals and quasi judicial bodies in matters relating to commercial disputes. This will reduce the burden of these quasi judicial bodies.

• Strict check :

As the court will be empowered to impose costs and other penalties on parties for failure to follow the directions set out in a case management hearing, and to impose exemplary costs against defaulting parties for willful or negligent failure to disclose all documents, or for wrongful or unreasonable withholding of documents for inspection, this will act as a deterrent against the defaulting party and result in fair and fast disposal of dispute.

• Boost commercial litigation :

With the setting up of specialized commercial courts, starting of new practices, appointment of more judges, economic growth all this will result in a boost to already flourishing commercial litigation  in India.

DISADVANTAGES

• Neglect towards small investors

As already said earlier the commercial courts and commercial division in the high courts will deal with cases of RS one crore or above only. Therefore a civil dispute below Rs one crore even though commercial in nature will have to be filed in ordinary courts. This may result in differentiation between big and small investors, and big companies may get speedy justice with money however small investors may have to wait for years for their due.Moreover it has same pecuniary jurisdiction for all states, however in cities like Mumbai or Delhi there are commercial disputes involving huge amount, but same is not the position in other states in India where there are large number of small investors.

• No guarantee of success

Even though after establishing 1000 fast track courts in India there is still 32 million cases pending in Indian courts as said by law and Justice Minister Kapil Sibal said in the Lok Sabha on 23^rd Dec 2013. So we hope for the best, but looking at the current reality of disposal of cases by Indian courts one cannot guarantee that the commercial courts will surely be a success.

CONCLUSION

In fast growing economy like India, with GDP of 7.3%, with huge foreign investment coming in, with fast changing market trends, with  high quality of higher judiciary and with a goal to improve legal system and become a develop economy being one side of the coin and huge pendency of cases in courts, corruption in legal system, only 0.4% of budget being allocated towards development of courts and judiciary on the other side, the Commercial Divisions and Commercial Appellate Divisions in High Courts and Commercial Courts Bill, 2015 is an appreciable initiative taken by the government to serve as a pilot project in the larger goal of reforming the civil justice system in India.

World’s developed economies like USA, UK, France, Russia etc and also commercial hub like UAE have special commercial courts and it is high time for India to have the same. And it is worth mentioning that Delhi High Court has already designated four benches as “commercial courts. According to 188^th report of the Law Commission there is a recent trend in the judgments of UK and US courts of selectively applying the principle of ‘forum non-conveniens’. To explain, where a foreign entity is doing business in India with an Indian entity, the said foreign entity is today being permitted by Courts in New York and London to file claims in courts in New York or London, on the assumption that there are extraordinary delays in Indian Courts. This is being done even if no part of the cause of action has arisen in those countries. The Supreme Court of New York, New York County in the year 2003, Shinetsu Chemical Co. Ltd vs. ICICI Bank (and State Bank of India), the Court took up the case on the assumption that in India even such cases would go on for fifteen years. That case related to a suit by a Japanese company against Indian Banks on the basis of Letters of Credit (where no cause of action arose, within US). There have been significant judgments of UK Courts which like the US Courts, have generalized about delays in Indian Court. In Vishwas Ajay: 1989(2) Lloyd’s Rep. 558, a generalized plea of ‘inordinate delays’ in India of the magnitude of ten years before actions come to trial, was accepted and it was assumed that there was denial of justice abroad. The matter was continued in the English Court, rejecting the application for stay filed by the defendants.Therefore once the Commercial Divisions and Commercial Appellate Divisions in High Courts and Commercial Courts Bill, 2015  is enacted, there will no longer be any scope for foreign courts to make generalizations or assumptions about delays in Indian Courts.

Sarosh Zaiwalla an Indian to set up UK’s first Indian law firm Zaiwalla & Co in London, On his trip to India, he spoke to Economic Times on the need to improve the legal sector and throw it open to foreign law firms to make India an attractive investment destination. He said “One of the reasons FDI is not coming into India is because people are worried about the legal sector and the arbitration. When a foreign party invests millions of funds, he has a joint venture partner in India. He wants to make sure if something goes wrong, he has the help of judges or the courts. For the purpose of FDI, what’s required is perception. We may be very honest, but if there’s one case of corruption, it comes to your mind that the whole system is corrupt. If laws are passed but you can’t implement them, you make a fool of yourself”. If India is really serious about attracting foreign direct investment, it will have to reform the legal system first. For example, the Supreme Court can have one international commercial matters bench”.

Also with the institution of the commercial divisions and commercial courts, judges must take a more active role in the resolution of the dispute; they can no longer be playing the role of a supervisor, rather they must be the manager or moderator. In this regard, an important provision in the Bill is that of “case-management hearings”. Recommended by the Law Commission after examining the practice of holding “pre-trial conferences” in Singapore, case management hearings are held within four weeks of the institution of the suit to examine the possibility of a settlement and to ensure smooth conduct by litigants. For this purpose, the judge may frame the issues for and between the parties, fix dates for evidence to be recorded, and set time limits on the oral arguments of the parties. Another provision is to award judges with the power to order an increase in court fees as a result of an increase in the number of hearings taken up, or the number of adjournments asked for, by the parties. This also widens the control that the judge has over the proceedings, besides ensuring the quick redressal of the dispute.

Therefore Commercial Divisions and Commercial Appellate Divisions in High Courts and Commercial Courts Bill, 2015 with the attributes of   benefiting  Indian economy and legal system be enacted with keeping into consideration the interest of small investors and clear demarcation of jurisdiction.

Is tribunalization effective way to reduce burden of the courts and provide speedy remedies. Income Tax Appellate Tribunal (ITAT), State Administrative Tribunal (SAT), Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Debt Recovery Tribunal (DRT), Central Administrative Tribunal (CAT), Intellectual Property Rights Tribunal, Electricity Tribunal and even a Railway Claims Tribunal—we have enough already. However, it’s time for one more. Eight years after they were first proposed, National Company Law Tribunals (NCLTs) are about to become reality, which is thanks to last week’s Supreme Court ruling. Will the creation of NCLTs take a load off corporate India’s back? Will they work?

OVER the last 25 years, Parliament has systematically taken away important judicial functions of the High Courts and the civil courts and vested them in quasi-judicial tribunals. However, there is a fear that in the process the stature of our High Courts has been reduced and, if this trend continues, vitally important cases will come to be decided by tribunals that are wholly controlled by the executive. The tribunalization of our judicial system will lead to consequences that our country will bitterly regret. Despite the fact that the functioning of most tribunals is in a pathetic state, the zeal to create more tribunals has not abated. Very few have realized that the real solution lies in strengthening the existing courts and confining tribunals to a few specialized areas. It is equally important to ensure that specialized tribunals are not manned by generalist civil servants or judges.

The Government planned to set up the National Company Law Tribunal under the newly enacted Companies Act, 2013. The National Company Law Tribunal is to be established as a quasi-judicial body. The mandate of the Tribunal is to adjudicate upon matters dealing with corporate and company related disputes. While the principal bench of the tribunal is to be set up in New Delhi, several other benches are touted to be set up in various states. The number of such benches could range from 12 to 13, across the country.

The National Company Law Tribunal would have the jurisdiction to deal with the disputes which were earlier within the power of Company Law Board, Board of Industrial and Financial Reconstruction and High Courts. As such, the scope of NCLT’s power shall extend to disputes relating to oppression and mismanagement, sick companies and their revival and winding up procedure with respect to companies. The orders of the National Company Law Tribunal are appealable in the National Company Law Appellate Tribunal.

The validity of the National Company Law Tribunal (‘NCLT’) and National Company Law Appellate Tribunal (‘NCLAT’) was one of the most debated issues in the company law since the introduction of Companies (Second Amendment) Act, 2002 to the Companies Act, 1956. The controversy was put to rest by the Supreme Court in 2010 in the case – Union of India Vs R. Gandhi, President, Madras Bar Association – wherein the constitutional validity of NCLT / NCLAT was upheld. The provisions relating to NCLT / NCLAT were included in the Companies Act, 2013 and such provisions were again challenged by Madras Bar Association. Recently, by its order dated 14^th May 2015, the Supreme Court upheld the constitutional validity of the NCLT / NCLAT provisions.

Brief Analysis of SC Ruling in Madras Bar Association Vs Union of India & Anr:

On May 14, 2015, the Constitution Bench of the Supreme Court led by Chief Justice HL Dattu partly allowed the writ petition filed by the Madras Bar Association wherein it struck down the validity of Technical Member appointment & Selection Committee constitution but it upheld the validity of the NCLT / NCLAT under the Companies Act, 2013. The provisions relating to NCLT & NCLAT were also challenged under the Companies Act, 1956 (in Union of India Vs R. Gandhi, President, Madras Bar Association), wherein the SC’s Constitution Bench upheld the validity of NCLT / NCLAT and certain provisions relating to constitution of board of company law administration were held as ‘unconstitutional’.In the present case, the SC’s Constitution Bench rejected Sr. Advocate Arvind Datar’s (representing the writ petitioner, Madras Bar Association) contention that UoI Vs R. Gandhi judgment did not deal with constitution of NCLAT. The SC held that the Constitution Bench categorically dealt with the constitutional validity of NCLT & NCLAT under the caption “Whether the constitution of NCLT and NCLAT under Parts 1B & 1C of Companies Act are valid”.SC completely dismissed Madras Bar Association’s reliance on 2014 ruling of SC, wherein the constitution of National Tax Tribunal (NTT) was held as ‘unconstitutional’. SC remarked that such ‘adventurism’ on the petitioner’s part is totally unfounded and stated that the earlier ruling in UoI Vs R. Gandhi is of Constitution Bench and  is binding on the co-ordinate Bench as well.Apex court differentiated the NTT ruling from NCLT/NCLAT and held that the NTT was a matter where power of judicial review exercised by the High Court was vested in NTT which was sought to be unconstitutional. SC observed that NCLT is the ‘first forum’ in the hierarchy of quasi-judicial fora set-up under the Companies Act, 2013 and stated that NCLT, would not only deal with question of law but would be called upon to thrash out the factual disputes/aspects as well.With respect to the issue of constitutionality of provisions for appointment of technical members to NCLT/NCLAT, the constitution bench of SC relied on its earlier ruling in Union of India Vs R. Gandhi and observed that only officers holding ranks of Secretaries or Additional Secretaries can be considered for appointment as Technical members.The SC held the constitution of Selection Committee (for selecting the Members of NCLT and NCLAT) as invalid and stated that instead of 5 members Selection Committee, it should be 4 members (2 from administrative branch + 2 from judiciary) Selection Committee. The 4-member Selection Committee shall include – Chief Justice, Senior Judge, Secretary in the Finance Ministry and Law Secretary, with the caveat that the Chief Justice will have a casting vote.

Impact of the SC Ruling on constitutional validity of NCLT & NCLAT:

The recent SC ruling on the constitutional validity of NCLT & NCLAT is one of the biggest leaps for the corporate sector and the professional fraternity. The step will have a positive impact on the corporate restructuring (i.e. mergers and acquisitions, capital restructuring, revival of sick companies and dispute related matters) as the NCLT will not just only replace the Company Law Board (CLB), but will also bring under its umbrella cases filed with the High Courts, Board for Industrial and Financial Reconstruction (BIFR) and the Appellate Authority for Industrial and Financial Reconstruction (AAIFR).It seems that matters pertaining to winding up have been taken out of jurisdiction of NCLT and NCLAT by recent amendment to the Companies Act, 2013 in 2015. However, Section 270 (which are yet to be made effective) onwards still refer to “Tribunal”.  The NCLT / NCLAT formation is welcome step as it will reduce the burden of the Supreme Court, High Courts and CLBs on the corporate law related matters, which will ultimately help in unlocking the value of distressed assets. NCLT / NCLAT being the ‘specialized benches’ for corporate law related mattes, it is expected that the matters will be listed and heard in an expeditious and time bound manner.The formation of NCLT / NCLAT will open wide gates  for the practicing Chartered Accountants, practicing Company Secretaries, and practicing Cost Accountants, as they would now be able to represent their client companies in matters requiring Tribunal approval i.e. mergers and amalgamations, capital restructuring, revival of sick companies and shareholders-management dispute matters. Until the formation of the NCLT/NCLAT, the practicing professionals (CA, CS & CWA) could appear only before the CLB and for the matters being heard by the HC and Supreme Court, only Advocates were eligible for arguments and representation. Now all practicing professionals (Advocates, practicing CA, practicing CS & practicing CWA) will be treated at par for representation before NCLT / NCLAT.For entering / establishing oneself in the field of NCLT / NCLAT, it would be desirable of a practicing professional to take some efforts for enhancing their skill sets, some of which are listed below:

1. Thorough study of the provisions of Companies Act, 2013;
2. Thorough study of the Secretarial Standards,
3. In-depth analysis and study of the provisions of Companies Act, 2013 as well as 1956 relating to mergers and amalgamations, capital restructuring, revival of sick companies and shareholders-management dispute matters;
4. Thorough knowledge of the case-laws on the topics relating to mergers and amalgamations, capital restructuring, revival of sick companies and shareholders-management dispute matters;
5. Developing art of advocacy  and soft skill;
6. Having basic knowledge relating to Tax Laws, Accounting treatments in matters relating to mergers and amalgamations, capital restructuring, revival of sick companies and shareholders-management dispute matters;

Here’s how the NCLTs will now work:
Tribunals will comprise one principle bench at Delhi, and then as many other benches as the Central Government thinks fit. Each bench will have at least one judicial member and one technical member.

Members will be selected by a committee that includes:

• The Chief Justice of India or his nominee
• A senior High Court or Supreme Court judge 
• One representative of the Ministry of Law and Justice
• One representative of the Ministry of Finance and Company Affairs.

To ensure the tribunals’ independence:

• No tribunal member will remain associated with a ministry or a civil service department after appointment.
• All administrative support will be provided by the law ministry.
  As per the Supreme Court’s directions, technical members of the tribunal must have:
• At least 15 years experience in industrial management, reconstruction, investment or accountancy · 
• Or, have held a high ranking post in the Indian Company Law Service.
  Judicial members must have:
• At least five years of experience as high court or district court judges.
• Or, at least ten years of experience as lawyers.

Conclusion: 

With the ever increasing corporate growth in the recent past in India coupled with various technological and rapid economic growth, the need of the hour is to have a good, proper and efficient mechanism to tackle the disputes, restructuring, mergers, amalgamations, revival, rehabilitation of companies and various other issues which a corporate would face and also to expeditiously dispose of the same. Handling a company dispute is a complicated matter and requires lot of attention, caution, specilization and we require experts to handle these cases. So far, the functions are handled by the CLB, BIFR and the High Courts, which to a greater extent performed their part in a well-defined manner with slight minor exceptions. There are no shortcomings in the present system of the High Courts which discharge its functions like entertaining winding up petitions, seeking sanction of the High Court for compromises, arrangements, mergers, demergers and for sanctioning scheme of amalgamations, etc. It may not be out of place to mention that the CLB has also been discharging its complicated responsibilities under the provisions of prevention of oppression and mismanagement and application for relief in case of mismanagement under section 397/398 of the Companies Act, 1956 and various other provisions. The Government needs to provide speedy and effective remedy to the corporate since corporate cannot wait for long to get their disputes/schemes sanctioned. After the implementation of the NCLT, it is to be seen how the new proposed Tribunals, viz., NCLT and NCLAT, would discharge their functions in future.

A pre-nuptial agreement or prenup, as it is commonly called, is a contract entered into by people who are planning to get married. Its content can vary widely, but commonly includes provisions for the division of property and assets should the couple divorce and any rights to spousal support during or after the dissolution of marriage.

While this concept is more prevalent in Western countries it is still not very popular in India because marriage as an institution is considered a pious and sacred bond and getting into an agreement prior to marriage does not goes well with the Indian society. Also, opting for such agreements invites social stigma that the couple shares low commitment, and anticipation of divorce even before marriage is both, bad omen and unromantic. Nevertheless, the global publicity about celebrity prenuptial agreements is encouraging people to consider the idea in India. It is therefore essential to understand that while prenuptial agreements might be a valuable way for parties to express their intention concerning the nature of their financial relationship; it is not possible to assure or even to expect that such agreed terms will be upheld in an Indian court in its entirety. But then, is it not a necessity in post modern society where marriage as an institution has received a major jolt in the light of acceptance of living relationship by a section of Society and also by judiciary?

There appears to be no concluding case law in India on the topic of prenups or postnups and it will not be incorrect to say that Apex court of law is yet to give its final word on it. Let us make an effort to understand the views of various High Courts as far as the legal standing of prenups is concerned. The Hon’ble High Court of Calcutta in the case of Tekait Mon Mohini Jemadai vs. Basanta Kumar Singh had held that though marriage under the Hindu Law is a contract, it is also a sacrament, it is more religious than secular in character; the union is indissoluble, for it is a “union of flesh with flesh, bone with bone.” The Hon’ble Court went to the extent of stating in details that ‘prenup is opposed to public policy’. According to the Hon’ble Court, such contract seems to be not only inconsistent with the theory of the relation between husband and wife according to the Hindu Law, but against public policy. Similar view was also taken by the Hon’ble High Court of Orissa and High Court of Madras. Hon’ble High Court of Orissa in the case of Sirbataha Barik v. Musamat Padma held that prenup is opposed to Hindu law and also opposed to public policy and thus, it is not a valid contract. Similarly, the Hon’ble High Court of Madras in the case of A.E. Thirumal Naidu v. Rajammal held that under the pre-nupital agreement between husband and wife to live separately from each other was invalid even if there is an agreement to that effect because as per the Hon’ble Court, it is forbidden under the Hindu law. The Hon’ble Court went to the extent of declaring prenup as opposed to public as held by Calcutta High Court and Orissa High Court. However, in certain aspects of personal law and in some cases Hon’ble Court has taken a lenient view whereby the Hon’ble court has not dismissed prenup totally and thus, the Hon’ble Court of Calcutta in the case of Sm. Sandhya Chatterjee vs. Salil Chandra Chatterjee has held “ it is just and desirable that they should live separately and comply with terms of agreement entered into between them – that will be beneficial to their interest as also their son living with mother – agreement not opposed to public policy and enforceable.” However, the Hon’ble Court in this case was dealing with the agreement entered into by the married couple and not strictly speaking between the couple before entering into marriage. However, in one of the cases dealing with Income Tax, the Hon’ble High Court of Calcutta had the occasion to deal with the prenup and in that case, the Hon’ble Court allowed the appeal on the basis of prenup and thus, held the prenup to be valid and legal. In this particular case between Commissioner of Income Tax v. Mansukhrai More, the Income Tax Tribunal upheld the assessee’s contention and directed exclusion of income from assessee’s property’s total income on the ground that it was transfer of property not out of love or natural affection but in fulfillment of obligations undertaken under pre-nupital agreement and it conveyed property in trust for benefit of minor children. The Hon’ble High court held that “Tribunal was justified in accepting existence and genuineness of pre-nupital agreement”. In another case, Hon’ble High Court of Jammu & Kashmir had an occasion to deal with prenup in the case of Mohd. Khan v. Mst. Shahmali. In this particular case, pre-nupital agreement was executed between the groom and bride’s father. In this case, the first appeal court held that “the agreement was not in any way opposed to the Muslim Law and was not in any way unconscionable. The violation of the condition by husband entitled the wife to seek divorce from the husband.” In this particular case, the issue that came up for hearing was that ‘if in the pre-nupital agreement the son-in-law binds himself to pay a specified sum as token money, spent by his father in law on the marriage on his running away from the house and deserting his wife, then on the happening of this contingency, if the father calls to pay the specified money, then in that case it would not constitute a doctrine opposed to Muslim law’. The Hon’ble Court upheld that position of Appeal Court and further held that “an anti-nupital agreement by a Muslim husband that he would pay separate maintenance to his wife in case of disagreement, and that the wife would have power to get herself divorced, in case of the failure of husband to pay the amount was not opposed to the public policy and was enforceable under the Muslim law.”

However, as stated before, the issues are still not clear and the issues need further churning before we reach to some conclusion. Thus, it will not be entirely incorrect to say that the court has not yet finalized its opinion as far as prenup is concerned and the issue is still wide open. Critically, the Supreme Court of India which is vested with extremely broad power to do justice between the parties and which has been quite active in matters concerning the grounds for divorce has taken no final stand on the matter of prenuptial agreements. However, it is to be noted that Laws like Protection of Woman from Domestic Violence Act and its interpretation by the Court across India has given an acceptance to the fact of ‘living relationships’ of couples without marriage and relationship which is ‘akin to marriage’. With Courts granting reliefs in the cases of living relationships and to relationship without marriage the concept of prenups has acquired an altogether new dimension. How do you deal with a couple, with regard to their rights and liabilities, who are residing together on the basis of prenuptial agreement?

As every concept has its own pros and cons this concept too have some advantages as well. The prenuptial agreement is characterized by great flexibility and can be tailor-made to the specific needs of the couple. It is of great interest to note that sometime back there was a news item, stating that the Karnataka state women’s varsity Vice- Chancellor, Dr. Syeda Akhtar has called upon Muslim girls to sign prenuptial agreements. Dr. Akhtar said this (prenuptial agreement) is the crucial first step which will guarantee a Muslim woman’s rights throughout her marriage. So, a prenuptial agreement can be an important document to enable a woman to assert her rights and ensure that she is not done out of her just dues. A prenup can be successful ONLY if both the couple are scrupulously honest about their assets. Hiding information about assets can defeat the purpose of a prenup – a harmonious division of assets upon a divorce.There are many other benefits of a prenup: it can protect a person from his/her partner’s debt loads; prevent one’s business/estate from getting divided; ensure spousal support in terms of monthly maintenance or alimony; guarantee remarriage rights and take care of child support and custody issues. All it requires is free consent and an honest declaration of individual assets and liabilities. But the crux of the matter lies elsewhere. Unlike most countries where a valid prenup is legal and binding when a couple separates, the Indian legal system does not fully recognize this pre-marital agreement. In fact, the concept is gaining some acceptance, especially in urban area, over the past few years but till date, it is not a completely legally valid pact as per the laws of our country.

Although all matrimonial laws in India have provisions for a wife’s maintenance and alimony (under the Hindu Marriage Act, however, either party can claim it), the amount payable always depends on the partners’ income, property and other circumstances. So it might have helped the couples who are fighting legal battle, had they declared their assets in the very beginning, reviewed their financial positions and agreed to a mutually acceptable division of wealth. This is the primary reason behind drawing up a prenup – so that a person may have a fair idea about what to give and what to receive if marriage goes kaput. In spite of lacking legal sanctity under Indian marital laws, a prenup can still be treated as a valid contract if a person and his/ her spouse consent to go by its terms and conditions. But then it will be more like divorce based on consent.

Another positive side of prenuptial agreement is that it may at least check some false prosecutions by unscrupulous Women, who are misusing Section 498A of IPC or Domestic Violence Act for blackmail and Extortion of money. That means, if both the parties are genuine, transparent and do not have any pre-planned ill mind, they will accept the same before marriage itself. The Prenuptials agreement stands a good chance of enforcement in India if the prenuptial agreement is certified by the court and this is probably possible under the “Special Marriage Act” where in the magistrate goes through all the documents and then declares the marriage based on those documents to be valid. It is therefore essential to understand that while prenuptial agreements might be a valuable way for parties in India to express their intention concerning the nature of their financial relationship; it is not possible to assure or even to expect that such agreed terms will be upheld in an Indian court.

Though divorce is quite common in India now, it is still not considered a possibility before the marriage and hence there is no thought of a pre-nuptial agreement. There is no talk of a pre-nuptial agreement at all as a way of a by-plan as far as the legislation is concerned. There may be a few people talking about the pre-nuptial agreement, but India is far from including it in it’s law and legislation plans. Even though we still have a long way to go before pre-nuptial agreements are implemented in India it is a way by which couples can protect their assets in case of a divorce. A pre-nuptial agreement helps resolve and simplify a lot of financial and property issues. Since the division of assets are already done before the marriage, implementing what has been decided before the marriage makes life simpler. It just comes down to dividing the assets as mutually decided by the couple and will save nasty arguments later. But a person could get a pre-nuptial agreement drafted abroad, marry in India according to Indian tradition but the agreement will be valid in that particular country only and not in india.

While the debate about its legal validity and advantages continues, it is better to look at the emotional and social feasibility of a prenup, which is often seen as a mark of mistrust or lack of commitment among couples even before marriage. One can’t change the society overnight but prenups are certainly getting popular in India, especially in the metro cities where about 10-15 per cent couples opt for some kind of pre-marriage Agreement as it gives them great peace of mind and makes them feel strong enough to handle all unforeseen circumstances. Although a very practical agreement, there are many who do not see the need for such a document. It, essentially, is an acceptance of the fact that marriage may not last. In other words, a person is giving up on his/her marriage before one even gets started. In fact, the couple, who are madly in love and who will soon vow that they will be together ‘always’, are expected to negotiate their own divorce settlement.

In conclusion it is perhaps wiser to go in for a prenuptial agreement that clearly states on a fair division of property, personal possessions and financial assets than fight over one’s favourite piece of furniture and crystal ware, later in the marriage. A well-drafted prenup can facilitate fairness, certainty and transparency in the treatment of marital or non-marital assets at a time when mutual anger may lead to misguided decisions. The law makers and the law regulators have to rise to the occasion and take in their stride the changing scenario. But then the issue arises as to how to handle the sacred ‘bandhan’ of seven lives sprinkled with ‘Teej’ and ‘Karva Chauth’!

Rakesh k. Singh.

This article is an unedited article written by me and which was also published in Bureaucracy today

The Prevention of Corruption Act, 1988 (No. 49 of 1988) is an Act of the Parliament of India enacted to combat corruption in government agencies and public sector businesses in India.

Taking a cue from US’ Foreign Corrupt Practices Act, 1977, and the UK’s Bribery Act, 2010, the government plans to come out with anti-bribery guidelines for companies and their employees while dealing with public servants. The government also proposes to hold commercial organisations responsible in case persons associated with them bribe public servants. These are part of a bigger move to have stricter anti-corruption laws in India – enhanced punishment for bribe givers and bribe takers; speedier completion of trails on corruption cases; extending protection from prosecution to public servants who cease to hold office following retirement, resignation, etc. Also later developments, such as, India ratifying the United Nations Convention Against Corruption “UNCAC”, international practice on treatment of the offence of bribery and corruption, etc. necessitated a review of the existing provisions of the Act, so as to bring it in line with current international practice and also to meet, more effectively, the country’s obligations under the UNCAC.

The Prevention of Corruption (Amendment) Bill, 2013 was introduced in the Rajya Sabha for the purpose on 19.08.2013. The Department Related Parliamentary Standing Committee submitted its report on the Bill to the Rajya Sabha on 06.02.2014 but the Bill could not be passed. As the Bill contemplates an important paradigm shift in defining offences relating to bribery, the views of the Law Commission of India were also sought on the proposed amendments. Further amendments are proposed in the Bill as recommended by the Law Commission of India in its 254th Report
The Union Cabinet approved amendments to the Prevention of Corruption Act, 1988, that provide for classifying corruption as a heinous crime and longer prison terms for both bribe-giver and bribe- taker. The proposed amendment act will also ensure speedy trial, limited to two years, for corruption cases.

It is expected that the proposed amendments would fill in perceived gaps in the domestic anti-corruption law and also help in meeting the country’s obligations under the United Nations Convention Against Corruption more effectively. The measures approved include penal provisions being enhanced from minimum 6 months to 3 years and from maximum five years to seven years. However, all is not well with the amendment and the biggest challenge has been to the proposed Section 17A which is being opposed by intellectuals across the country lead by Dr. Jayprakash Narayan of Lok Satta. However, before proceeding to the said attempt to dilute the anti graft law let us first understand the other aspect of the said amendment.

1. 7-year prison term brings it to the heinous crime category
   The amendments to the Prevention of Corruption Act, 1988, approved by the Union Cabinet include enhancing punishment from the minimum 6 months to 3 years and from the maximum five years to seven years.
   The seven-year imprisonment brings corruption to the heinous crime category. The ambit of the existing Act will be enhanced to make commercial entities liable for inducement of public servants. Under the present law, only individuals are liable. The proposed amendment bill also provides for issue of guidelines to commercial organisations to prevent persons associated with them from bribing a public servant.
   
2. Non-monetary gratification
   Non-monetary gratification will also be covered within the definition of the word gratification in the PCA 1988.
3. Nature of Proposed Amendments
   The Prevention of Corruption (Amendment) Bill, 2013 proposes following changes in aforesaidActs/Ordinance to widen the description and coverage of offence of bribery in the line with currentinternational practice.

An effort to bring the anti-corruption laws in India in parity with global best practices and the judicial pronouncements seems plagued with “hurried drafting and mechanical lifting” of certain provisions of the foreign law.

Though a much-needed endeavour in light of India’s ratification of the United Nations Convention Against Corruption (UNCAC) in May 2011, the 2013 Bill—which is an amendment to the Prevention of Corruption Act 1988; Delhi Special Police Establishment Act 1946; and Criminal Law (Amendment) Ordinance 1944—has come under severe criticism by the Law Commission, which feels that the approach “to transplant certain provisions from the UK Bribery Act, while well intended, is misconceived and will serve to create further confusion and ambiguity.”With the aim to bring in clarity with regard to payment of bribery to public servants, Law Commission chairman AP Shah, in his report submitted to law minister Sadananda Gowda, has proposed some significant amendments in the Prevention of Corruption (Amendment) Act.The suggestions were made after carrying out a detailed study of the UNCAC and other relevant statutes and case laws of India and the UK.
As of now, the Prevention of Corruption Act only covers public servants and does not bring in its fold companies and private individuals. It is for the first time that the government is proposing amending the Act to hold “a commercial organisation liable for failure to prevent persons associated with it from bribing a public servant.” It also laid down necessary norms for commercial organisations to set their house in order to tackle any form of corruption perpetrated by their employees or associates in the course of business to further the interests of the organisations.
The 54-page report describes as “overbroad” the provision which ascribes criminal liability “to every person who is in charge of and responsible to the organisation for the conduct of its business” if the offence is proved to have been committed with the consent or connivance of the company, since it exposes the entire top brass to a jail term of 3-7 years.
Suggesting a better solution, the law panel has asked the legislature to drop the phrase ‘undue financial or other advantage’ from the entire Bill and substitute it with ‘undue advantage’ throughout. “The clause ‘financial or other advantage’ (as proposed in the 2013 Bill) does not seem to cover sexual favours in return for the public servant’s acts or omissions. Thus, the proposed amendment is actually narrowing the scope of corruption, instead of the stated intent of expanding it,” the panel added.
The rationale given by Justice Shah is that the ‘undue advantage’ would cover any gratification whatsoever, other than legal remuneration, and that the word ‘gratification’ is not limited to pecuniary gratifications or to gratifications estimable in money. The Law Commission report says that only that official must be held liable whose consent or connivance is proved, without any harassment caused to other officials of the company. The report also criticises a provision which says that a company would have to pay a fine if it is unable to prevent acts of corruption.
While the proposed Section 8 targets commercial organisations for indulging in bribery of a public servant to obtain an undue advantage in business, the proposed Section 9 talks about the vicarious liability of the commercial organisations in failing to exercise due diligence to prevent persons associated with it from bribing a public servant.
Unlike the UK’s Bribery Act, the proposed amendment to Section 9 does not envisage the publication of any sort of guidance or any obligation on the government, and it places the entire burden of proof on commercial organisation to prove their innocence. The Commission has recommended that a new clause should be inserted making it mandatory for the government to publish guidelines for “adequate procedures” after due consultation with the public.
“This provision will lead to an immediate and significant impact on the conduct of business by corporations, especially in light of the fact that they will not have any clarity on what is expected of them and will not even know if the procedures and processes they adopt are in compliance or in possible breach,” Shah said.
Even separate procedures for attachment and forfeiture introduced in the 2013 Bill in cases of corruption by public servants are bound to create confusion. Thus, Shah has recommended replacement of the proposed sections 18A-18N with a single provision to ensure compliance with the UNCAC.
Though the Law Commission has managed to correct the inordinate errors, what remains to be seen is whether Parliament will check its faults by accepting the suggestions. If accepted, the Bill may have far-reaching implications on understanding corruption in public life and efforts to counter it. The amendment Bill is likely to be brought before Parliament in this Budget session.
There must be a senior officer in an investigating agency to decide whether or not a decision was taken in good faith. It should not be left to a junior official to decide on a particular case.”One should not judge a civil servant on the basis of whether a decision is right or wrong, but on the basis of the documents or the information available to him as he took that decision
“It is a welcome a step. But it has to be seen that these provisions, after they become part of law, are implemented in letter and spirit,” said former Central Vigilance Commissioner (CVC), PJ Thomas. Legal experts also said they feel that the proposed changes will help in checking corruption in the country.

GIVING BRIBE IS ALSO AN OFFENCE:
 There is also a need to distinguish between collusive corruption and extortionist corruption where the first is when both/all the parties involved indulge in corruption to do something which is not legal. On the other hand extortionist bribery is something which is out of compulsion and thus a person is forced to give some money to get his legal dues done. Thus both kind of corruption can not be dealt with the same yardstick and it requires different understanding and protection. 

Amendments Proposed in Section 17

• In 2003, Section 6A was incorporated in the Delhi Special Police Establishment Act, 1946 (DSPE Act, 1946) dealing with CBI. This section mandated prior approval of government before CBI took up investigation of cases of corruption under Prevention of Corruption Act, 1988 (PC Act, 1988) relating to officers of the rank of Joint Secretary and above.

In 2014, in the case of Dr. Subramanian Swami vs Director, CBI and others (writ petition (civil) number 21 of 2004 of Centre for Public Interest Litigation vs Union of India) the Supreme Court struck down Section 6A as unconstitutional and violative of rule of law.

• PC Act, 1988 gives full freedom to investigative agencies to conduct enquiry into allegations against any public servant. No prior permission was envisaged in law for investigation. However, Section 19(1) of the PC Act, 1988 as well as Section 197 of CrPC envisage prior sanction of prosecution of a public servant.
   
• Now the Union government is introducing an official amendment in the pending legislation The Prevention of Corruption (Amendment) Bill, 2013 (PC Amendment Bill, 2013). Under the proposed Section 8B of the Amendment Bill, a new Section 17A is sought to be inserted in the Principal Act as follows:

“17A (1) No police officer shall conduct any investigation into any offence alleged to have been committed by a public servant under this Act, where the alleged offence is relatable to any recommendation made or decision taken by such public servant in the discharge of his official functions or duties, without the previous approval-
(a) of the Lokpal, in the case of a public servant who is employed, or as the case may be, was at the time of commission of the alleged offence employed in connection with the affairs of the Union, and is a person referred to in clauses (a) to (h) of sub-section (1) of section 14 of the Lokpal and Lokayuktas Act, 2013;
(b) of the Lokayukta of the State or such authority established by law in that State under whose jurisdiction the public servant falls, in the case of a person who is employed, or as the case may be, was at the time of commission of the alleged offence employed in connection with the affairs of a State,
Conveyed by an order issued by the Lokpal in accordance with the provisions contained in Chapter VII of the Lokpal and Lokayuktas Act, 2013 or the Lokayukta of the State or such authority referred to in clause (b) for processing of investigation against the public servant:Provided that no such approval shall be necessary for cases involving arrest of a person on the spot on the charge of accepting or attempting to accept any undue advantage for himself or for any other person.
(2) Any information received or any complaint which is made to a police officer or any agency (including the Delhi Special Police Establishment) in respect of an alleged offence relatable to any recommendation made or decision taken by a public servant in discharge of his official functions or duties shall, first, be referred by such police officer or agency-
(i) in respect of a public servant referred to in clause (a) of sub-section
(1), to the Lokpal;(ii) in respect of a public servant referred to in clause (b) of sub-section (1), to the Lokayukta of the State or such authority referred to in that clause.
(3) Any information or complaint referred by a police officer or the agency under the subsection (2), shall be deemed to be a complaint made to-
(a) the Lokpal under clause(e) of sub-section (1) of section (2) of the Lokpal and Lokayuktas, Act, 2013 and all the provisions of the said Act shall apply accordingly to such complaint;
(b )the Lokayukta of a State or such authority established by law in a State, as the case may be, and all the provisions of the law under which the Lokayukta or such authority has been established shall apply accordingly to such complaint”.

Implications of the proposed Section 17A:

1. This covers all recommendations and decisions of all public servants in the discharge of their official functions or duties. That means, except in cases of successful trap, every allegation of corruption must first be forwarded to Lokpal/Lokayukta for prior approval of investigation. The police, who have the duty to investigate any and every crime, including murder, rape, misappropriation, are prevented from investigating corruption on their own.
    
2. Given the way Lokpal/Lokayukta institutions are structured, we can have every confidence that each case will be decided on merits. But there are about 60 lakh public servants of Union government (including public undertakings and departments), and in many major states there are over 10 lakh public servants. Overall, there are about 200 lakh or 2 crore public servants in India. If the CBI and State Anti-Corruption Bureau (ACB) have to forward each case to Lokpal/Lokayukta before even commencing investigation, the whole anti-corruption institutional framework will be jammed and paralysed.
   
3. The proposed Section17A does not even allow a summary, instant decision by Lokpal/Lokayukta. The amendment specifies that the Lokpal/Lokayukta must give prior approval conveyed by an order issued in accordance with the provisions contained in Chapter 7 of the Lokpal and Lokayuktas Act, 2013. Chapter 7 of the Lokpal and Lokayuktas Act, 2013 envisages an elaborate procedure even for preliminary enquiry. In case of Lokpal, it may again involve CVC, CBI or Lokpal’s own investigative wing. Also, even at preliminary stage, the public servant must be given an opportunity of being heard. The preliminary enquiry may take 90 days or longer. Only after such an elaborate procedure can Lokpal/Lokayukta accord approval for investigation.
   
4. This provision ultimately creates enormous hurdles to the investigation of any corruption offence even in the preliminary stage. What is needed is speedy sanction of prosecution under Section 19(1) of the PC Act, 1988 and Section 197 of CrPC, and to ensure that such sanction power vests in an independent, impartial authority like Lokpal/Lokayukta. Instead, even powers of investigation are taken away from CBI and ACBs by the new Section 17A.
   
5. The net result will be tremendous weakening of investigative agencies, and dilution of Lokpal and Lokayuktas. The Lokpal/Lokayuktas are intended to be high ombudsmen to hold senior civil servants and highly placed public servants to account. By bringing every case of corruption before them even at the allegation stage prior to investigation, the Lokpal/Lokayuktas lose all relevance as high ombudsmen, and will become ineffective, overburdened, dysfunctional, slow-moving bureaucracies, defeating the very purpose of Lokpal legislation.

This provision may not hold its ground in the court of law with supreme court of india very likely to declare it as unconstitutional. In fact it is illogical in extending the discredited single directive to all classes of government employees, retrogressive as it weakens investigative agencies, burdensome on the institutions of Lokpal/Lokayuktas, and ultimately counter-productive in combating corruption.

THUS 2 Major concern of the amendment is Section 17A and non distinction of compulsive corruption with collusive corruption. The PCA, even after the amendment, is expected to suffer from a few pragmatic difficulties. As mentioned above, not only prosecution but also investigation requires prior sanction, which is seldom forthcoming and plagued with procedural barriers and red-tapism. This may result in abysmally low prosecution rates as in the past. 

Aam aadmi party is here to stay: in spite of the near blank and the drubbing, as perceived by many, AAP is here to stay. The recent election results are interesting for more than one reason. The results are beyond imagination and is an eye opener for pokitical pundits. Simply talking of aap, it is clear that you can not ignore them. Politics, more than anything else, is a game of perception. The perception about aap among its leaders and supporters including media was very high after the delhi election and what I call delhi experiment. Therefore all the talk of aap being over is like criticising sachin tendulkar for only making 40 runs and not a century. The decision of the party to contest on all india basis has only strengthened the base of the party. The party today can boast of all india presence and support base. There are number of political parties with ideologies like that of aap but the success of aap is more than that. With 4 MP’s from punjab alone and decent share of votes all around the country the party has hit the mind and heart of the nation. With bjp lead NDA in power and gradual decline of communist parties in india the aap is here to fill the space left over by communist party. With the rising globalisation combined with liberalisation and privatisation one section of society with its anti capitalist stand is bound to be the support base for aap. Aap is here to stay.

DELHI HIGH COURT HAS RECENTLY STRUCK DOWN THE HIKE IN COURT FEES

Noting that the “exorbitant” hike in court fee violated the fundamental right of access to justice and discriminated against poor litigants, the Delhi High Court struck down the Court Fee (Delhi Amendment) Act 2012.
“We have held that the Delhi legislative Assembly did not have the legislative competence to amend the Court Fee Act, 1870. We have also held that the Court Fees (Delhi Amendment) Act, 2012, adversely impacts the Part – III rights and results in violation of Article 38 and 39A of the Constitution of India. For thesereasons…the Court Fee (Delhi Amendment) Act, 2012, is hereby declared as invalid and ultra vires the Constitution and, therefore, struck down,” the bench of Justice Gita Mittal and Justice J R Midha had said.
The bench also ordered the government to refund the court fee collected from litigants based on prescriptions contained in the Act. The court held that it was the “constitutional duty of the state …to provide adequate finances to the institution to ensure the independence and impartiality of the judiciary” and that the “burden of bearing the cost….cannot ideally be transferred to the citizens”.
The Delhi government had passed the amendment in the budget session of the Assembly, stating that court fee had not been revised since 1958. The hike was meant to raise the revenue through court fee from Rs 50 crore to over Rs.450 crore.
The amendment had increased the fee for filing a writ petition before the Delhi High Court from Rs.5 to Rs.100.To file a bail application, the fee was hiked from Rs.1 to Rs.100 for district courts and from Rs.3 to Rs.250 for the High Court.
The amendment, which came into force from 1st August, 2012, had been greeted with protests by lawyers. The order has been passed on the petition filed by the Delhi High Court Bar Association.