List of Current Affairs

Source: Supreme Court

Why in News?

Recently the Supreme Court has held that non-bailable warrants should not be issued, unless the accused is charged with a heinous crime, and is likely to evade the process of law or tamper or destroy the evidence.

• The aforesaid observation was made in the matter of Sharif Ahmed & Anr. v. State Of Uttar Pradesh & Ors.

What was the Background of Sharif Ahmed & Anr. v. State Of Uttar Pradesh & Ors. Case?

• In this case, the non-bailable warrant was issued against the appellants by the trial court after the appellants didn't show his appearance before the court despite the issuance of a bailable warrant.
• The chargesheet was filed against the appellant for the offences punishable under the provisions of the Indian Penal Code, 1860 (IPC).
• The appellants approached the Allahabad High Court seeking the quashing of the chargesheet and of proceedings.
• The Allahabad High Court dismissed the application for quashing of the chargesheet.
• Thereafter, the appellants filed the present appeal before the Supreme Court.
• Allowing the appeal, the Supreme Court quashed the criminal proceedings.

What were the Court’s Observations?

• The bench comprising Justices Sanjiv Khanna and SVN Bhatti observed that while there are no comprehensive set of guidelines for the issuance of non-bailable warrants, this Court has observed on several occasions that non-bailable warrants should not be issued, unless the accused is charged with a heinous crime, and is likely to evade the process of law or tamper or destroy evidence.
• It was further held that it is a settled position of law that non-bailable warrants cannot be issued in a routine manner and that the liberty of an individual cannot be curtailed unless necessitated by the larger interest of the public and the State.

What are the Provisions Relating to Warrant?

About:

• A warrant is a written instrument issued by the Judge or Magistrate on behalf of the state which authorizes the arrest and detention of an individual or the search and seizure of an individual's property.
• A warrant of arrest remains in force until it is executed or cancelled by the court which issued it.

Objectives:

• The primary reason for issuing warrants is to ensure the proper administration of justice.
• A warrant may be issued as a precautionary measure, compelling the accused to appear in court.

Essential Elements:

• As per Section 70 of the Criminal Procedure Code, 1973 (CrPC), the following are the essentials of warrant of arrest:
  • The warrant of arrest must be in writing.
  • It must be signed by the Magistrate.
  • It must bear the seal of the court.
  • Bear the name and designation of the executant of such warrant.
  • Indicate the clear name and address of the accused.
  • State the offence with which the accused is charged.
  • Indicate date of issue.
  • Indicate the date of appearance.
  • May be executed at any place in India.

Bailable Warrant:

• When the warrant for arrest may include a direction that if the person arrested under the warrant executes a bond and gives security for his attendance in court, he shall be released.
• A warrant with such direction is generally called a bailable warrant of arrest.
• This warrant allows the accused to post bail and be released from custody until the trial.

Non-Bailable Warrant:

• A non-bailable warrant is a type of arrest warrant issued by a court when a person is accused of a serious offence, and the court believes there is a significant risk that the individual may flee or not cooperate with the legal proceedings if released on bail.
• A non-bailable warrant does not permit the accused to be released on bail. Instead, they are arrested and held in custody until their court appearance or until further orders from the court.
• The decision to issue a non-bailable warrant is made by the judge based on the nature of the offense, the severity of the charges, the likelihood of the accused fleeing, and other relevant factors.

Execution of Warrant:

• According to Section 72 of CrPC, a warrant may be directed to the police officer or any person.
• According to Section 74 of the CrPC, a warrant directed to any police officer can also be executed by any other police officer whose name is endorsed upon by the police officer directed.
• According to Section 78 of CrPC, a warrant of arrest to be executed outside the local jurisdiction of the Court may be directed by the Court to be executed by the police officer or send the warrant to any Executive Magistrate or District Superintendent of Police or Commissioner of Police within whose jurisdiction it is to be executed. The receiver of the warrant shall endorse his name on the warrant and execute it according to the provision of the Code.
• As per Section 80 of CrPC, if an accused is outside the jurisdiction of the Court issuing the warrant he shall be produced before the Court, if it is within thirty kilometers from the place of arrest and the accused fails to obtain bail.

Procedure for Execution of Warrant:

• The terms of the warrant are to be executed between 6 a.m. to 10 p.m. of the day, and, if the said warrant is executed outside the given time, then the time period is extended by a judge and the police officer must inform the appropriate authority.
• As per Section 75 of CrPC, the police officer or another person who is executing a warrant shall inform the person being arrested of the contents of the warrant.
• As per Section 76 of the CrPC, the person arrested on warrant shall be produced in the Court without any delay, i.e., within 24 hours as prescribed by the code. The stipulated time period of 24 hours does not include the time necessary for the journey from the place of arrest to the Magistrate’s Court.

Case Law:

• In the case of State of Bihar v. J.A.C. Saldanha (1980), the Supreme Court held that a non-bailable warrant should not be issued without proper consideration of the circumstances, and there should be valid reasons for believing that the accused might flee or tamper with evidence.

Source: Supreme Court

Why in News?

Recently the Supreme Court held that the suit instituted for recovery of dues from a sick company will not be hit by Section 22 (1) of the Sick Industrial Companies (Special Provision) Act, 1985 (1985 Act), if it does not affect the properties of the sick company or revival scheme.

What was the Background of Fertilizer Corporation of India Limited & Ors. v. M/S Coromandal Sacks Private Limited case?

• A company M/s Coromandal Sacks Private Limited, the original plaintiff which is engaged in the manufacturing of High Density Poly Ethylene (HDPE) bags.
• A company Fertilizer Corporation of India Ltd., the original defendant is a Public Sector Undertaking of the Government of India.
• The original defendants required HDPE bags for their customers and placed an order for the same with the plaintiff.
• The terms and conditions for technical specifications of the bags and for payment were specified in the notices inviting tender (NIT) issued sometimes and the purchase orders issued in pursuance thereof.
• According to such terms, the defendant had to make an entire payment within 20 days of the receipt of the bags and approval of the same.
• The terms of the purchase order also entitled the defendants to deduct up to a maximum of 5% of the contract price towards liquidated damages upon delay in supply of bags by the original plaintiff.
• The plaintiff instituted a suit before the trial court, and his contention was that the purchase orders were amended to increase the number of bags, and for this requirement the plaintiff supplied 42,000 bags over and above the quantity.
• The plaintiff was aggrieved by the deductions made by the defendants for delay in supply and for poor quality of bags.
• The plaintiff also claimed that he suffered losses due to the refusal to accept 25,000 bags after placing the order.
• The plaintiff instituted the civil suit for the recovery of Rs 8,27,100.74/- along with Rs 10,31,803.14/- towards interest up to the date of institution of the suit.
• The defendant in his written statement stated that they had been declared to be a sick company under Section 3(1)(o) of the Sick Industrial Companies (Special Provision) Act, 1985 (1985 Act) and this suit for recovery is not maintainable according to Section 22(1) of 1985 Act and interest @ 24% was not liable to be imposed.
• The Trial Court decreed the plaintiff’s suit held that the defendant’s company failed to prove that it is a sick company and directed the defendant to pay Rs. 55,710/-, Rs. 100,848 and Rs. 1,18,000/- to the plaintiff together with interest @ 12% per annum and Rs. 1,72,734/- with interest @ 12% per annum.
• Appeal was filed before the High Court. The High Court accepted the contention of the plaintiff on the issue of interest and granted 24% compound interest on the amounts due. And set aside the decree of the trial court which granted 12% simple interest in favor the plaintiff.
• The defendant presents an appeal before the Supreme Court.

What were the Court’s Observations?

• The Supreme Court held that the suit was a simple suit for recovery of money towards the dues arising under the alleged illegal deductions under the contract.
• The suit for recovery was not of a nature which could have proved to be a threat to the properties of the defendant sick company or would have adversely impacted the scheme of revival.
• This cannot be said to be a proceeding in the nature of execution, distress or the like and hence the suit was not hit by Section 22(1) of the 1985 Act.
• The conditions given under Section 22(1) of 1985 Act are fulfilled, there is no bar on institution of suit against the sick company.
• An order of the High Court is upheld only subject to the modification of the period for which interest may be granted. And the High Court committed no error in awarding 24% interest.

What are the Landmark Judgments Cited in this Case?

• Bhoruka Textiles Ltd. v. Kashmiri Rice Industries (2009)
  • The Supreme Court held that if the jurisdiction of the civil court was ousted in terms of the jurisdictional bar imposed under Section 22 of the 1985 Act, then any judgment rendered by it would be coram non-judice and as a result a nullity.
• Raheja Universal Limited v. NRC Limited and Others (2012)
  • The Supreme Court held that a suit for recovery of money simpliciter will not be liable to be suspended under Section 22(1) of the 1985 Act.
• Tata Motors Ltd. v. Pharmaceutical Products of India Ltd. [(2008)
  • The Supreme Court held that the 1985 Act is a special statute and, thus, overrides other Acts like the Companies Act, 1956.

Who is Sick Company?

• Sick company means a company which has failed to pay or to secure the debt of the secured creditors within a specified time.
• A company who is struggling financially with accumulated losses more than or equal to its net worth is called a sick company.
• Winding up of a sick company is avoided as much as possible because it affects government revenues, jobs and money for creditors. In the worst case, sick company can be wound up.
• The word ‘sick industrial company’ was defined under Section 3 (1) (o) of 1985 Act as “an industrial company (being a company registered for not less than five years) which has at the end of any financial year accumulated losses equal to or exceeding its entire net worth.”
• The Companies Act, 2013 prescribes a detailed legal procedure for reviving and rehabilitating sick companies.

What is the Sick Industrial Companies (Special Provision) Act, 1985?

• The government found there was an increase in the incidents of sickness of companies which results in loss of production, loss of employment, loss of revenue etc.
• The government felt the need to enact legislation to provide preventive, remedial measures and rehabilitation to sick companies.
• The Sick Industrial Companies Act of 1985 was enacted to identify or detect sick companies and potentially sick companies. To address a problem and try to revive and rehabilitate them.
• The Act created two level bodies to help and rehabilitate sick companies.
• Board of Industrial and Financial Reconstruction (BIFR).
• Appellate Authority for Industrial and Financial Reconstruction (AAIFR)
• The 1985 Act was repealed and replaced in 2003 by the Sick Industrial Companies (Special Provisions) Repeal Act of 2003.
• The 1985 Act was fully repealed in 2016, in part because some of its provisions overlapped with the provisions of a separate Act, the Companies Act of 2013 under Chapter XIX (Sections 253 to 269).

What are the Legal Provisions Involved in this Case?

Section 22 (1) of the Sick Industrial Companies (Special Provision) Act, 1985:

• This Section deals with the suspension of legal proceedings, contracts, etc.
• It states that where in respect of an industrial company, an inquiry under Section 16 is pending or any scheme referred to under Section 17 is under preparation or consideration or a sanctioned scheme is under implementation or where an appeal under Section 25 relating to an industrial company is pending, then, notwithstanding anything contained in the Companies Act, 1956 (1 of 1956) or any other law or the memorandum and articles of association of the industrial company or any other instrument having effect under the said Act or other law, no proceedings for the winding up of the industrial company or for execution, distress or the like against any of the properties of the industrial company or for the appointment of a receiver in respect thereof and no suit for the recovery of money or for the enforcement of any security against the industrial company or of any guarantee in respect of any loans or advance granted to the industrial company shall lie or be proceeded with further, except with the consent of the Board or, as the case may be, the Appellate Authority.

What is the Procedure of Rehabilitation and Revival under the Companies Act, 2013?

The Companies Act provides a process under Chapter XIX for the revival and rehabilitation of sick industrial companies to help them in times of crisis.

• Filing an Application for Determination of Sickness of the Company
  • Any secured creditor representing 50% or more of the company’s outstanding debt can file the application before the tribunal.
• Order Passed by the Tribunal
  • The tribunal will pass an order after considering all facts, documents and evidence within 60 days of receiving the application.
  • If the tribunal is satisfy that a company is a sick company, further procedures are to be followed
• Submitting an Application for Revival and Rehabilitation to the Tribunal
  • Any secured creditor or sick company itself can apply before the tribunal to decide measures to revive and rehabilitate the company. The following documents must be submitted: financial statement, draft scheme, if any, other information, documents and fees.
• Appointment of an Interim Administrator
  • The tribunal will appoint an interim administrator within 7 days of receiving the application.
  • The interim administrator will conduct a meeting of the committee of creditors within 45 days of order of tribunal.
  • The interim administrator must submit a report within 60 days of order of tribunal.
  • The interim administrator will create a committee of creditors.
  • He can ask them to provide any information or documents.
• Order of the Tribunal
  • The tribunal on the fixed hearing date decides whether the company can be revived or rehabilitated.
  • If it is possible to revive or rehabilitate the company, the tribunal will appoint a person to prepare a draft scheme.
• Appointment of Company Administrator
  • He will draft a scheme to revive the sick company, and the Tribunal can also order him to take over the company’s management.
• Preparation of Scheme for Revival and Rehabilitation
  • The company administrator shall prepare a scheme of revival and rehabilitation after considering the draft scheme filed by the company.
  • The administrator will present the scheme within 60 days of his appointment.
  • Once the scheme is approved, the administrator can submit it to the Tribunal.
  • If the Tribunal is satisfied that there is a possibility of implementing the scheme, the tribunal will sanction the scheme.
• Implementation of the Scheme
  • A sanctioned scheme is binding on the sick company, its employees, shareholders, creditors, guarantors, and the amalgamating company.

Source: Supreme Court

Why in News?

Recently the bench of Justices Surya Kant and KV Viswanathan has held that “Notwithstanding any resolution passed by the Supreme Court Bar Association, some of the posts in the Executive Committee must be reserved for women members of the bar”.

• The Supreme Court gave this order in the case of Supreme Court Bar Association v. BD Kaushik.

What was the Background of Supreme Court Bar Association v. BD Kaushik Case?

• The Supreme Court had previously invited suggestions from SCBA members regarding reforms in the election process vide order dated 14^th August 2023.
• The SCBA held a Special General Body Meeting on 30^th April 2024 where eight resolutions were put forward, but all failed to get the required 2/3rd majority of members present and voting.
  • These resolutions pertained to revising eligibility criteria for SCBA office bearers, revising admission and deposit fees, increasing the minimum number of members required to convene meetings, increasing the tenure of the Executive Committee, and introducing reservation for women.

What were the Court’s Orders?

• The SC recognized that the SCBA was integral to the country's highest judicial forum.
  • The Court acknowledged the need for timely reforms in the SCBA to meet evolving challenges while ensuring due consideration of suggestions from bar members.
• Accordingly, the following major directions were issued:
  • The SCBA Executive Committee was directed to invite suggestions from all bar members through public notice on its website by 19^th July 2024, including suggestions already received.
  • Cross-suggestions on the compiled suggestions were to be invited till 09th August 2024.
  • To ensure adequate representation of women in the SCBA governance, the following reservations were implemented with immediate effect:
    • Minimum 1/3rd seats (3 out of 9) in the Executive Committee
    • Minimum 1/3rd (2 out of 6) Senior Executive Members
    • At least one post of Office Bearer reserved for women on rotation basis
    • For the 2024-25 election, the post of Treasurer was reserved for women
  • The SCBA elections for 2024-25 were directed to be held on 16^th May 2024 based on the 2023 voter list, updated to include eligible members from 01^st March 2023 to 29^th February 2024.
  • The Supreme Court Registry was directed to provide the requisite updated lists of eligible members by 03^rd May 2024.

What is the Journey of Women Reservation in India?

• National Perspective Plan:
  • The National Perspective Plan for Women in 1988 recommended providing reservation for women right from the panchayat level to Parliament.
• 73^rd and 74^th Constitutional Amendments:
  • 73rd and 74th Constitutional Amendments in 1992, mandated all states to reserve one-third of seats for women in local bodies.
  • Article 243D (2) and Article 243T (2) gave reservation to women in Panchayat and Municipalities, respectively.
• Women Reservations Bills:
  • The Women's Reservation Bill for Parliament and state assemblies was first introduced in 1996.
    • However, it could not be passed due to lack of majority.
  • Subsequent attempts were made in 1998, 1999, and 2008, but all the bills lapsed with the dissolution of the respective Lok Sabhas.
  • The Rajya Sabha passed it in 2010, but it remained pending in the Lok Sabha.
  • Various committees and reports, including the 2013 Committee on the Status of Women, recommended at least 50% reservation for women in all decision-making bodies.

What are the Major Committees on Women Reservation?

• 1971 Committee on the Status of Women in India (CSWI):
  • It was set up by the erstwhile Ministry of Education and Social Welfare, examined the constitutional, administrative, and legal provisions affecting the social status of women.
  • Its report, 'Towards Equality,' highlighted the state's failure to ensure gender equality and recommended reservations for women in local bodies.
• 1987 Committee under Margaret Alva:
  • It presented the National Perspective Plan for Women 1988-2000, which included a recommendation for reserving seats for women in elected bodies.
  • This led to the 73^rd and 74^th Constitutional Amendment Acts in 1992, mandating reservation of one-third of seats for women in local bodies.
• 1996 Select Committee headed by Geeta Mukherjee:
  • In 1996, the first Women's Reservation Bill was sent to a Select Committee headed by Geeta Mukherjee.
  • The committee recommended considering extending reservation to OBC women at an appropriate time.
• 2013 Committee on the Status of Women:
  • The 2013 Committee on the Status of Women, constituted by the Ministry of Women and Child Development, recommended ensuring at least 50% reservation for women in all decision-making bodies, including Parliament and state assemblies.

What is Women Reservation Act, 2023?

• About:
  • The Constitution (106^th Amendment) Act, 2023, popularly known as the Women's Reservation Act, 2023, is a landmark legislation that reserves one-third of all seats for women in the Lok Sabha, state legislative assemblies, and the Legislative Assembly of the National Capital Territory of Delhi.
  • The Act aims to increase the representation of women in the highest decision-making bodies of the country.
• Articles Inserted and Amended:
  • Article 330A for reservation in the Lok Sabha
  • Article 332A for reservation in state assemblies, and
  • Article 239AA amended for reservation in the Delhi Legislative Assembly.