Madras High Court Weekly Round-Up: November 11 - November 17, 2024

NOMINAL INDEX

Union of India v Abdul Razak and Others, 2024 LiveLaw (Mad) 431

M Samudi v The District Collector and Others, 2024 LiveLaw (Mad) 432

Union of India v. C.V.L. Annapurna, 2024 LiveLaw (Mad) 433

G.Kulanchiyappan v Vice Chancellor, IMU, 2024 LiveLaw (Mad) 434

The Commissioner of Income Tax, Chennai v. M/s. Johnson Lifts Pvt. Ltd, 2024 LiveLaw (Mad) 435

The Triplicane Permanent Fund Ltd. v. The Tamil Nadu Sales Tax Appellate Tribunal, 2024 LiveLaw (Mad) 436

Nalin Gupta v. Commissioner of Customs, 2024 LiveLaw (Mad) 437

Lakshana Cotton Spinning Mills Limited v. The Commercial Tax Officer, 2024 LiveLaw (Mad) 438

Vasumathi and Another v R Vasudevan and Others, 2024 LiveLaw (Mad) 439

Santhanaganesh v State and Another, 2024 LiveLaw (Mad) 440

VP Nandhakumar v The Inspector of Police, 2024 LiveLaw (Mad) 441

Bharathiya Janata Party v The District Collector and Others, 2024 LiveLaw (Mad) 442

Kasthuri v The State, 2024 LiveLaw (Mad) 443

ABC v XYZ, 2024 LiveLaw (Mad) 444

P.A.Ramasubramania Raja v. K.M.Sanjeevi Raja, 2024 LiveLaw (Mad) 445

EIH Associated Hotels Ltd vs. CIT, 2024 LiveLaw (Mad) 446

REPORT

NIA Act | High Courts Cannot Expand Scope Of Interpretation, Condone Delay Beyond Permissible Limit: Madras High Court

Case Title: Union of India v Abdul Razak and Others

Citation: 2024 LiveLaw (Mad) 431

The Madras High Court recently held that the High Court was not empowered to condone the delay in filing an appeal under the National Investigating Agency Act 2008 beyond the permissible limit. As per Section 21 of the Act, an appeal has to be made within 30 days of the date of the order or judgment. The Section allows the High Courts to entertain an appeal even after expiry of 30 days but not beyond 90 days if it is satisfied that there was a sufficient cause for delay.

The bench of Justice SM Subramaniam and Justice V Sivagnanam held that when there is no constitutional challenge to an enactment, the courts could not read down the provision differently than what the constitution had intended. The court added that the language employed in the provision under the NIA Act was unambiguous and thus the courts could not condone the delay beyond the permissible limits.

HR & CE Authorities Must Take Action On Complaints Of Encroachment, Not Put It In Cold Storage Making Deities Yearn For Due Share: Madras HC

Case Title: M Samudi v The District Collector and Others

Citation: 2024 LiveLaw (Mad) 432

The Madras High Court recently stressed that when an application is received informing instances of encroachment of temple land, the Hindu Religious and Charitable Endowment authorities were expected to look into the same and take immediate action.

Justice M Dhandapani made the remarks after noting that due to inaction on the part of HR & CE officials, encroachers often enjoyed land to the detriment of the deity. The court emphasised that when an application was filed under Section 78 of the Tamil Nadu Hindu Religious and Charitable Endowment Act, the authorities were to take immediate steps and ensure that the encroachments are removed and the lawful owners are benefitted.

No Explicit Option For CPF Means Automatic Transition To GPF Scheme: Madras HC Upholds Pension Rights Of KV Teachers

Case Name: Union of India v. C.V.L. Annapurna

Citation: 2024 LiveLaw (Mad) 433

Madras High Court: A Division Bench of Justice Anita Sumanth and Justice G. Arul Murugan upheld the Central Administrative Tribunal's orders granting pension rights under the General Provident Fund (GPF) scheme to retired Kendriya Vidyalaya teachers. The Court ruled that teachers who had not explicitly opted to remain under the Contributory Provident Fund (CPF) scheme by January 31, 1989, were automatically entitled to GPF benefits as per the 1988 Government Office Memorandum. The Court rejected the argument that continuous receipt of CPF benefits implied a choice to remain in the CPF scheme, emphasizing that KVS's failure to implement the automatic transition couldn't prejudice the teachers' rights.

Long Service And Transparent Recruitment Merit Regularization Despite Absence Of Rules: Madras HC

Case Title: G.Kulanchiyappan v Vice Chancellor, IMU

Citation: 2024 LiveLaw (Mad) 434

Madras High Court: A Division Bench of Justice Anita Sumanth and Justice G. Arul Murugan directed the Indian Maritime University (IMU) to regularize the services of eight contractual employees. The Court ruled that their appointments, though irregular, were not illegal as they were made through a transparent recruitment process including public advertisement and interviews. The Court emphasized that the absence of recruitment rules until 2015 and the employees' decade-long unblemished service warranted regularization, particularly given IMU's prior regularization of seven similarly situated workshop employees.

Amount Received In Advance For Services To Be Treated As Income Of Assessee, Chargeable Under Income Tax: Madras High Court

Case Title: The Commissioner of Income Tax, Chennai v. M/s. Johnson Lifts Pvt. Ltd.

Citation: 2024 LiveLaw (Mad) 435

The Madras High Court ruled that any amount received in advance for services should be treated as the income of the assessee and is, therefore, subject to income tax.

The Division Bench of Justices R. Suresh Kumar and C. Saravanan observed that “if “Accounting Standards” are properly applied by an assessee, the “accounting income” for the payment of income tax will be available. However, if an assessee fails to adopt “Accounting Standards” properly for computation of income, the discretion is vested with the Assessing Officer under Section 145(3) of the Income Tax Act, 1961.”

[Tamil Nadu General Sales Tax] Assessee Liable For Tax On Proceeds From Sale Of Unredeemed Articles By Auctioneers: Madras High Court

Case Title: The Triplicane Permanent Fund Ltd. v. The Tamil Nadu Sales Tax Appellate Tribunal

Citation: 2024 LiveLaw (Mad) 436

The Madras High Court stated that assessee is liable to tax on consideration received from sale of unredeemed articles by auctioneers.

The Division Bench of Justices Anita Sumanth and G. Arul Murugan observed that “the levy of penalty under Section 12(3)(a), in the case of non-filing of returns, is, automatic. Admittedly, the assessee has not filed the returns and hence, the basis of assessment would be irrelevant.”

Cross-Examination Requests In Show Cause Proceedings Cannot Be Allowed Without A Reply From Noticee: Madras High Court

Case Title: Nalin Gupta v. Commissioner of Customs

Citation: 2024 LiveLaw (Mad) 437

The Madras High Court stated that a request for cross-examination of a witness in a Show Cause proceeding cannot be allowed if no reply on merits has been provided by the noticee.

The Division Bench of Justices R. Suresh Kumar and C. Saravanan observed that “………the question of entertaining an application for cross-examination of the witnesses without any reply on merits by a notice in a show cause proceeding is to be eschewed and should not to be allowed.”

The bench noted that the question of granting extensions under the first proviso to Section 28(9) of the Customs Act, 1962 will arise only after the limitation for passing Order determining duty or interest, as the case may be, within the time stipulated under Section 28(9) of the Customs Act, 1962 had expired.

Further, the bench stated that only after the period of six months or one year, as the case may be, the senior officer could extend the period by another six months or one year specified in Clause (a) and Clause (b) under the first proviso to Section 28(9) of the Customs Act, 1962. The second proviso to Section 28(9) of the Customs Act, 1962, further contemplates abatement of the proceedings if after the extension period under the first proviso to Section 28(9) of the Customs Act, 1962, no Orders are passed.

Recovery Action Against Company Directors Cannot Be Initiated If Status Of Assessee Is Non-Existent: Madras High Court

Case Title: Lakshana Cotton Spinning Mills Limited v. The Commercial Tax Officer

Citation: 2024 LiveLaw (Mad) 438

The Madras High Court ruled that recovery actions against the directors of a company cannot be initiated if the status of the assessee is non-existent.

The Division Bench of Justices Anita Sumanth and G. Arul Murugan observed that “while in the case of amalgamation, it is only the apparent and outer shell of the company which is destroyed…. However, in the case of dissolution, the entity wholly ceases to exist.”

Hindu Succession Act |2005 Amendment Giving Equal Rights To Daughter Resulted In Reducing Shares Of Mother & Widow: Madras High Court

Case Title: Vasumathi and Another v R Vasudevan and Others

Citation: 2024 LiveLaw (Mad) 439

While discussing the 2005 amendments to the Hindu Succession Act, Justice N Seshasayee of the Madras High Court observed that while the amendment ensured that daughter's got a share in the ancestral property, it also took away the quantum of property that would otherwise vest with the widow and the mother of a deceased.

The court added that the effect of a notional partition was two fold. Firstly to interfere with the right of the surviving coparceners to succeed to the share of the deceased coparcenor by survivorship and secondly to reduce the combined holding to the extent of the property that became allottable to Class I female heirs.

Discussing the observations of the Supreme Court in Vineeta Sharma v Rakesh Sharma, the court added that the intent of the legislature while bringing in the 2005 amendment was to provide security and dignity to a certain class of female heirs of a deceased coparcener. The court observed that the notional partition under Section 6 of the Act engineered a vertical and horizontal division of ancestral property among the coparceners, as a vehicle to grant some right in the ancestral property to a class of female heirs.

Natural For Two Persons In Love To Hug & Kiss Each Other: Madras High Court Quashes Sexual Harassment Case Against Man

Case Title: Santhanaganesh v State and Another

Citation: 2024 LiveLaw (Mad) 440

The Madras High Court recently quashed criminal proceedings initiated against a man under Section 354A IPC for allegedly committing sexual harassment on a girl.

Justice Anand Venkatesh observed that to constitute an offence of sexual harassment, a man must have committed physical contact and made advances involving unwelcome and explicit sexual overtures. In the present case, the court noted that the love affair between the man and the woman was admitted and it was quite natural for two persons in love to hug and kiss each other.

Madras High Court Refuses To Quash Summons Issued To MD Of Manappuram Finance Ltd For Allegedly Auctioning Stolen Gold

Case Title: VP Nandhakumar v The Inspector of Police

Citation: 2024 LiveLaw (Mad) 441

The Madras High Court recently refused to quash a notice issued to the CEO and Managing Director of Manappuram Finance Limited for allegedly auctioning stolen gold.

Justice KK Ramakrishnan of the Madurai bench refused to quash the notice issued to VP Nandhakumar by the Central Bureau of Investigation under Section 41 (A) of CrPC. The court added that the procedure under Section 41(A) was applicable to all persons and whatever his position, he had to appear before the investigating officer and co-operate with the investigation

The court agreed with the prosecution's submission and noted that whether Nandhakumar had knowledge or not was to be investigated by the CBI and presently the CBI had issued the summons only to collect materials from Nandhakumar. Thus, the court noted that he was duty bound to appear and to co-operate with the investigation.

Honouring Bharat Mata Is An Expression Of Love And Pride: Madras High Court Asks State To Return Bharatha Matha Statue Taken From BJP Office

Case Title: Bharathiya Janata Party v The District Collector and Others

Citation: 2024 LiveLaw (Mad) 442

The Madras High Court recently asked the State to return a Bharatha Matha statue that was seized from the Bharathiya Janata Party's office in Virudhanagar East.

Though the authorities claimed to have removed the statue to maintain peace and harmony in the society, Justice Anand Venkatesh observed that no person in their right mind would contend that the expression of one's patriotism would imperil the interest of the State or any community.

The court went on to add that the installation of the statue on a private property was deeply personal and symbolised the individual's reverence for the motherland. The court remarked that honouring Bharatha Matha by erecting a statue was an expression of love and pride and served as a reminder of the values and sacrifices associated with one's heritage. The court said that the statute was like a personal shrine that embodied hope, unity and respect for the land and invited ideals of freedom, resilience and cultural identity that Bharatha Matha represents.

Madras High Court Denies Anticipatory Bail To Actress Kasthuri For Alleged 'Controversial Remarks' About Telugu Community

Case Title: Kasthuri v The State

Citation: 2024 LiveLaw (Mad) 443

The Madras High Court on Thursday (November 14) denied anticipatory bail to South Indian actress Kasthuri for her alleged comments against the Telugu community in Tamil Nadu.

A single bench of Justice Anand Venkatesh, on Thursday dismissed the anticipatory bail plea filed by the actress.

Speaking at a Brahmin meet in Chennai on November 3^rd, the South Indian actress had purportedly made comments against the Telugu community suggesting that the Telugu people, who had come to serve the courtesans of the Tamil Kings were now claiming to be of Tamil race. After widespread backlash, Kasthuri issued an apology stating that her comments were specific to some individuals and not against the Telugu community.

ALSO READ: Tendering Apology As A Matter Of Course To Escape Consequences Of Hate Speech Cannot Be Entertained: Madras High Court

Advocates Should Try To Resolve Matrimonial Disputes 'Without Adding Fuel To Fire': Madras High Court Suggests BCI To Form Guidelines

Case Title: ABC v XYZ

Citation: 2024 LiveLaw (Mad) 444

The Madras High Court recently suggested the Bar Council of India to formulate guidelines ensuring that Advocates resolve matrimonial disputes amicably without adding fuel to the fire.

The bench of Justice Bhavani Subbaroyan and Justice KK Ramakrishnan remarked that lawyers had an enormous social responsibility to ensure that the social fiber of family life is not ruined or demolished. The court added that legal professionals should ensure that exaggerated versions of small incidents are not reflected in criminal complaints and must maintain the noble traditions of the profession.

The court thus suggested that advocates should follow ethical standards when parties solicit their advice and never misguide the parties. The court added that advocates should not give unprofessional advice to implicate persons who are not even remotely connected to the alleged occurrences. The advocates were also asked to advise the clients to not rope in unconnected persons and inform the clients about the legal consequences of giving false complaint against unconnected persons. The court suggested that in cases involving two individuals, especially a family, the advocates should try to advise for an amicable settlement as far as possible.

Opinion On Merits Destined To Remain In Sealed Cover Forever: Madras HC Observes As 46-Yr-Old Dispute Ends After Parties Reach Compromise

Case Title: P.A.Ramasubramania Raja v. K.M.Sanjeevi Raja

Citation: 2024 LiveLaw (Mad) 445

A 46 year old land dispute suit was recently disposed of by the Madras High Court after the parties informed the court that they have arrived at a compromise.

"Shocked" by the long pendency of the suit, the High Court had in July this year transferred the suit–earlier pending before the lower court, to itself by exercising powers under Section 24 of the Code of Civil Procedure and Article 227 of the Constitution, after one of the parties approached the court challenging the order in an interlocutory application.

Justice Bharath Chakravarthy, on noting that there was a chance of settlement, gave another opportunity to the parties to come up with their options though the court had already prepared the judgement. Following this, the parties arrived at a settlement and filed a joint compromise memo before the court.

Expenses Incurred For Payment Of Foreclosure Premium Of Loan Is Allowable As Business Expenditure U/S 37(1): Madras High Court

Case Title: EIH Associated Hotels Ltd vs. CIT

Citation: 2024 LiveLaw (Mad) 446

The Madras High Court recently ruled that the expenditure incurred for payment of foreclosure premium for restructuring loan and obtaining fresh loan at a lower rate of interest is allowable as business expenditure u/s 37(1) of the Income Tax Act.

Such ruling came while dealing with a case where scrutiny proceedings were initiated, leading in revisional assessment u/s 263, based on the assumption that assessment order was prejudicial to the interest of Revenue Department, and resultant disallowance of payment of foreclosure premium as a business expenditure.

The Division Bench of Justice Anita Sumanth and Justice G. Arul Murugan observed that “Though mere disagreement with the view taken by the AO would not be a sufficient ground for invoking power u/s 263, it is quite another matter if the conclusion of the authority is palpably erroneous or contrary to settled law or judgment of the superior Courts”.

OTHER DEVELOPMENTS

Madras High Court Allows Release Of Suriya Starrer 'Kanguva' After Producer Makes Part Payment Towards Dues

Case Title: The Official Assignee v S Arjunlal Sunderdas and Another

Case No: A 5694 of 2024

The Madras High Court on Wednesday (November 13) cleared the release of Suriya and Bobby Deol starrer Kanguva movie after its producer, K E Gnanavel informed the court of making part payment towards dues.

A division bench of Justice G Jayachandran and Justice CV Karthikeyan also recorded a proposal made by the producer of making a one time settlement of Rs 3,75,00,000 by December in addition to the Rs. 6,41,96,969 already made by the producer. The court thus modified its earlier order asking Gnanavel to deposit Rs 20 crore by today (Wednesday) for allowing the release of the movie and instead granted time till December to make the one time settlement.

Govt To Consider Verifying Criminal Antecedents Of School Teachers Before Appointment: State Tells Madras High Court

Case Title: AP Suryaprakasam v State

Case No: WP 25034 of 2024

The Tamil Nadu government on Wednesday (November 13) informed the Madras High Court that it was considering bringing in a proposal whereby appointments to the Secondary Grade Teachers, PG Assistants, or any other posts in the Government schools and government Aided Institutions shall be made only after verifying the antecedents of the candidates.

The submission was made before a bench of Justice D Krishnakumar and Justice PB Balaji which was hearing a public interest litigation seeking a CBI inquiry into the alleged sexual assault and harassment of school students at a Fake NCC camp in Krishnagiri District of Tamil Nadu.

Advocate General PS Raman appearing for the state informed the court that a procedure, similar to the one adopted in other departments like Police, Judiciary, etc, would be adopted by verifying the declaration of the candidates regarding their involvement in criminal cases. He further informed the court that the State would take necessary decisions and pass appropriate orders in this regard which would be placed before the court.