1. Money-laundering offence not limited to place where proceeds come into possession

“It is clear that even if the involvement is in one or more of the following activities or processes, namely, concealment, possession, acquisition, use, projecting it as untainted property, claiming it as untainted property, the offence of money-laundering will be made out. An offence of money-laundering comprises two essential limbs, namely, involvement in any process or activity; and connection of such process or activity to the proceeds of crime…Thus, the involvement of a person in any one or more of certain processes or activities connected with the proceeds of crime, constitutes the offence of money-laundering…In other words, a person may first, acquire proceeds of crime in one place, second, keep the same in his possession in another place, third, conceal the same in a third place, and fourth, use the same in a fourth place. The area in which each one of these places is located, will be the area in which the offence of money laundering has been committed. To put it differently, the area in which the place of acquisition of the proceeds of crime is located or the place of keeping it in possession is located or the place in which it is concealed is located or the place in which it is used is located, will be the area in which the offence has been committed. In addition, the definition of the words ‘proceeds of crime’ focuses on ‘deriving or obtaining a property’ as a result of criminal activity relating to a scheduled offence. Therefore, the area in which the property is derived or obtained or even held or concealed will be the area in which the offence of money laundering is committed.” [Justice V. Ramasubramanian in Rana Ayyub v. Directorate of Enforcement, 2023 LiveLaw (SC) 86]

2. Trial of money-laundering offence follows trial of predicate offence

“it is contended by the Solicitor General that under the scheme of the Act, the complaint of money-laundering should follow the complaint in respect of the scheduled offence. Section 44 deals with the question of territorial jurisdiction of the special court. At the outset, the section takes note of two different contingencies, namely, cases where the scheduled offence as well as the offence of money-laundering are committed within the territorial jurisdiction of the same special court, and cases where the court which has taken cognizance of the scheduled offence, is other than the special court which has taken cognizance of the complaint of the offence of money-laundering…By prescribing that an offence punishable under Section 4 of the PMLA and any scheduled offence connected to the same shall be triable by the special court constituted for the area in which ‘the offence’ has been committed, Section 44(1)(a) makes it crystal clear that it is the special court, which will be empowered to try even the scheduled offence connected to the same. After mapping out/laying down such a general but fundamental rule, the Act then proceeds to deal with a more complicated situation. The question as to what happens if the court which has taken cognizance of the scheduled offence is other than the special court which has taken cognizance of the offence of money-laundering, is what is sought to be answered by clause (c) of sub-section (1) of Section 44. If the court which has taken cognizance of the scheduled offence is different from the special court which has taken cognizance of the offence of money-laundering, then the authority authorised to file a complaint under PMLA should make an application to the court which has taken cognizance of the scheduled offence. On the application so filed, the court which has taken cognizance of the scheduled offence, should commit the case relating to the scheduled offence to the special court which has taken cognizance of the complaint of money-laundering. Therefore, it is clear that the trial of the scheduled offence should take place in the special court which has taken cognizance of the offence of money-laundering. In other words, the trial of the scheduled offence, insofar as the question of territorial jurisdiction is concerned, should follow the trial of the offence of money-laundering and not vice versa.” [Justice V. Ramasubramanian in Rana Ayyub v. Directorate of Enforcement, 2023 LiveLaw (SC) 86]

3. Once deficiency in service is proved, suitable compensation should be awarded

“The respondent visited the saloon of the Hotel ITC Maurya, New Delhi for hair styling so that she would have a clean and groomed appearance before the interview panel where she was to appear after a week…The respondent gave specific instructions to the hair dresser. She was instructed to keep her head down and as she wears high-powered spectacles (removed at the time of hairstyling), she could not clearly see herself in the mirror as to what the hair dresser was actually doing. According to the respondent, the instructions given were simple and would not take much time but when the hairdresser took more than an hour to do the hair styling, she questioned the hairdresser as to why she was taking so much time. She received an answer from the hairdresser that she was giving her ‘the London Haircut’. When the hair styling was complete, to her utter surprise, she noticed that the hairdresser had chopped off her entire hair leaving only four inches from the top and barely touching to her shoulders which was quite contrary to the instructions given by her. According to the respondent, as a result of the faulty haircut, the respondent could not continue to lead her normal busy life as she no longer looked pretty, she had to face great humiliation and embarrassment, her career in the world of modelling was completely shattered, she went into a state of depression…The NCDRC awarded a lumpsum compensation of Rs.2 crores to be sufficient to meet the ends of justice…The question as to whether there was a deficiency in service or not would be a question of fact. The NCDRC, based upon the evidence led which included the affidavits, photographs, CCTV footage, WhatsApp chats and other material on record, came to the conclusion that there was deficiency in service. We are not inclined to interfere with the said finding regarding deficiency in service as the same is based upon appreciation of evidence and thus would be a pure question of fact. The next question is that, on account of such deficiency in service, what would be an adequate compensation taking into consideration the various claims made by the respondent, either under different heads or a lumpsum amount. From a perusal of the impugned order, we do not find reference to or discussion on any material evidence to quantify the compensation. In the facts of the case, we are of the view that the respondent if she has material to substantiate her claim may be given an opportunity to produce the same. Once deficiency in service is proved then the respondent is entitled to be suitably compensated under different heads admissible under law. Question is on what basis and how much. Let this quantification be left to the wisdom of the NCDRC based upon material if any that may be placed before it by the respondent.” [Justice Vikram Nath in ITC Limited v. Aashna Roy, 2023 LiveLaw (SC) 87]

4. Writ jurisdiction can be invoked for discrimination by state in its contractual dealings

“The first question is whether the writ petition filed by Indian Petrochemicals Corporation Limited challenging certain clauses of the contract [with Gas Authority of India Limited] was maintainable…Although the dispute arises from a commercial contract, we find that the writ petition challenging the clauses was maintainable. It is not disputed that GAIL is a public sector undertaking and thus qualifies under the definition of ‘State’ as per Article 12 of the Constitution. At the time of entering into contract, GAIL was enjoying a monopolistic position with respect to the supply of natural gas in the country. IPCL, having incurred a significant expense in setting up the appropriate infrastructure, had no choice but to enter into agreement with GAIL. Thus, there was a clear public element involved in the dealings between the parties. Further, writ jurisdiction can be exercised when the State, even in its contractual dealings, fails to exercise a degree of fairness or practices any discrimination…In the present case, GAIL’s action in levying ‘loss of transportation charges’ was ex facie discriminatory, insofar as IPCL was mandated to build its own pipeline in terms of the allocation letter and was not using GAIL’s Hazira – Bijaipur – Jagdishpur pipeline at all. Thus, it cannot be said that merely because an alternative remedy was available, the Court should opt out of exercising jurisdiction under Article 226 of the Constitution and relegate the parties to a civil remedy.” [Justice Sanjay Kishan Kaul in Gas Authority of India Limited v. Indian Petrochemicals Corporation Ltd., 2023 LiveLaw (SC) 88]

5. Unequal bargaining power giving rise to ‘Hobson’s Choice’

“Now, we come to the validity of the clauses under which ‘loss of transportation charges’ were levied. In our view, it would be extremely unfair and unjust, apart from being an arbitrary action in violation of Article 14 of the Constitution of India that Indian Petrochemicals Corporation Limited is charged for loss of transportation charges when it is mandated to lay down its own pipelines and not to transport the gas through the Hazira – Bijaipur – Jagdishpur pipeline by GAIL India Limited. This action also violates the principle of non-discrimination enshrined in Article 14. IPCL, which is using its own pipelines, is being treated at par with other commercial entities who are carrying gas through the HBJ pipeline laid down by GAIL. This is more so when the pricing orders by the concerned authority, i.e., the Ministry of Petroleum and Natural Gas stipulate a fixed price for natural gas. On a basic principle, it cannot be doubted that once GAIL has laid down the pipeline, it is entitled to structure in its cost in the contract. However, the issue is not simply that. We are faced with a scenario where two public sector enterprises entered into a contract in pursuance of the allocation made by the MoPNG. There was also a time constraint for IPCL. After incurring a heavy expenditure in the construction of the Gandhar Plant, IPCL had very little choice but to enter into the contract. What is of most significance is that IPCL was bound to follow the allocation terms provided by the principal authority, i.e., MoPNG. Thus, as pleaded by IPCL, they were faced with a ‘Hobson’s choice’, where they had to either give up the contract or accept the clauses levying transportation charges. On a conspectus of the above factors, it can be said that GAIL exercised an unequal bargaining power at the time of signing the contract. In fact, the contractual exercise of providing such a clause runs contrary to every commercial and common sense and is manifestly arbitrary, as IPCL is not being charged under any general terms but for a specific purpose. This purpose cannot exist in the contract in view of the master authority, i.e., the Union of India, providing to the contrary. GAIL may have made a huge investment in constructing the HBJ pipeline, but at the same time IPCL had also made a huge investment in constructing its own pipelines. This was not an option, but a mandate of the allocation letter issued by the MoPNG. Thus, it is difficult for us to accept that on the one hand IPCL must lay down its own pipelines, and simultaneously pay for loss of transportation through the HBJ pipeline even without using it. We do not accept GAIL’s contention that the charges could be levied merely because GAIL had laid the HBJ pipeline for users generally.” [Justice Sanjay Kishan Kaul in Gas Authority of India Limited v. Indian Petrochemicals Corporation Ltd., 2023 LiveLaw (SC) 88]

6. Death by sun stroke does not amount to death caused by external violence

“The insurance contracts are in the nature of special class of contracts having distinctive features such as utmost good faith, insurable interest, indemnity subrogation, contribution and proximate cause which are common to all types of insurances. Each class of insurance also has individual features of its own. The law governing insurance contracts is thus to be studied in three parts, namely, general characteristics of insurance contracts, as contracts, special characteristics of insurance contracts, as contracts of insurance, and individual characteristics of each class of insurance…This court has held that the insurance contract must be read as a whole and every attempt should be made to harmonise the terms thereof, keeping in mind that the rule of contra proferentem does not apply in case of commercial contract, for the reason that a clause in a commercial contract is bilateral and has mutually been agreed upon. Now we turn to the specific clause in the Memorandum of Understanding, which would govern the insurance policy providing for payment of compensation in the event of death (only) resulting ‘solely and directly’ from the accident caused by external violent and any other visible means. On a plain reading itself, leave aside the question of strict interpretation of the clauses, it is quite apparent that the admissibility of the claim is in the event of death. The second part of the same sentence begins with ‘only’. Thus, even in the event of a death, it is only in the scenario where the consequent situation arises, i.e., it has to be solely and directly from an accident caused by external violence. Here the death is by sun stroke. There was no semblance of any violence being the cause of death. The last aspect which reads as ‘any other visible means’ would be an expression to be read in the context of ejusdem generis with the external violent death and cannot be read in isolation itself…If in the aforesaid context, the policy is analysed, the cause arising from a sun stroke cannot, in our view, be included within the parameters of the ‘Scope of Cover’ in the insurance policy defining when such insurance amount would become payable.” [Justice Sanjay Kishan Kaul in National Insurance Company Limited v. The Chief Electoral Officer, Nhava Sheva, 2023 LiveLaw (SC) 90]

7. Necessary for all amenities and facilities advertised to be provided irrespective of scale of project

“The complaint of the appellants was that the respondents have not provided playground, community hall, beautified lake, landscape gardening, generator backup, multi-gymnasium, etc. as mentioned in the brochure/advertisement pursuant to which they expressed interest to purchase flats in the project and, thus, defaulted in providing services in relation to housing construction…One entire paragraph in the order has been devoted by the National Consumer Disputes Redressal Commission to highlight that the project was not that huge and talk of common areas and facilities on a grand scale was quite misplaced. An admission made by the appellants themselves in the complaint has been referred to, but we have not been able to trace any admission of the complainants that the respondents promised not to deliver substantial common areas and common facilities. Be that as it may, what the NCDRC omitted to bear in mind was that the appellants were allured to purchase flats of the nature and kind together with facilities and amenities as attractively published in the brochure/advertisement; hence, whether the project was huge or otherwise was absolutely beside the point. It was the duty of the NCDRC to ascertain, based on the materials on record, whether if at all and to what extent facilities and amenities as promised were offered and/or whether there was any deficiency of service.” [Order by bench of Justices S. Ravindra Bhat and Dipankar Datta in Debashis Sinha v. RNR Enterprise represented by its Proprieter/Chairman, Kolkata, 2023 LiveLaw (SC) 92]

8. Complaints not be spurned on the ground that consumers ought to have known what they were purchasing

“The conduct of the respondents, the National Consumer Disputes Redressal Commission recorded in the impugned order, was far too casual and on the face of it, the respondents are guilty of ‘unfair trade practice’ within the meaning of the Consumer Protection Act. After so recording, the NCDRC held that this does little to rescue the complainants. The reason assigned therefor defies logic. We have failed to comprehend as to what the NCDRC meant when it observed that the appellants ‘ought to have known what they were purchasing’. More often than not, the jurisdiction of the consumer fora under the Consumer Protection Act is invoked post-purchase. If complaints were to be spurned on the specious ground that the consumers knew what they were purchasing, the object and purpose of the enactment would be defeated. Any deficiency detected post-purchase opens up an avenue for the aggrieved consumer to seek relief before the consumer fora. The reasoning of the NCDRC is, thus, indefensible. Indeed, the appellants had purchased their respective flats on payment of consideration amounts as per market rate and there was due execution and registration of the deeds of conveyance preceded by agreements for sale and these instruments did indicate, inter alia, what formed part of the common facilities/amenities; however, the matter obviously could not have ended there. Whether the appellants had been provided what the respondents had promised did survive for consideration, which does not get reflected in the impugned order.” [Order by bench of Justices S. Ravindra Bhat and Dipankar Datta in Debashis Sinha v. RNR Enterprise represented by its Proprieter/Chairman, Kolkata, 2023 LiveLaw (SC) 92]

9. Flat owners do not forfeit right to claim amenities advertised by merely taking possession

“The National Consumer Disputes Redressal Commission, in our opinion, might have missed to appreciate the present-day realities of life. Nowadays, flat owners seldom purchase flats with liquid cash. Flats are purchased on the basis of finances being advanced by banks and other financial institutions. Once a flat is booked and the prospective flat owner enters into an agreement for loan, instalments fall due to be paid to clear the debt irrespective of whether the flat is ready for being delivered possession. The usual delays that are associated with construction activities result in undue anxiety, stress, and harassment for which many a prospective flat owner, it is common knowledge, even without the project/flat being wholly complete is left with no other option but to take possession. Whether, upon taking possession, a flat owner forfeits his/her right to claim such services which had been promised but are not provided resulting in deficiency in services is a question that the NCDRC ought to have adverted to… The conduct of the respondents, the National Consumer Disputes Redressal Commission recorded in the impugned order, was far too casual and on the face of it, the respondents are guilty of ‘unfair trade practice’ within the meaning of the Consumer Protection Act. After so recording, the NCDRC held that this does little to rescue the complainants…Once the NCDRC arrived at a finding that the respondents were casual in their approach and had even resorted to unfair trade practice, it was its obligation to consider the appellants’ grievance objectively and upon application of mind and thereafter give its reasoned decision. If at all, the appellants had not forfeited any right by registration of the sale deeds and if indeed the respondents were remiss in providing any of the facilities/amenities as promised in the brochure/advertisement, it was the duty of the NCDRC to set things right.” [Order by bench of Justices S. Ravindra Bhat and Dipankar Datta in Debashis Sinha v. RNR Enterprise represented by its Proprieter/Chairman, Kolkata, 2023 LiveLaw (SC) 92]

10. Powers of Bar Council of India and state bar councils not pari materia

“The object of Parliament enacting the said Act was to consolidate the law relating to legal practitioners. The prominent role of the Bar Council of India, the apex body, is apparent from the functions prescribed for the Bar Council of India under Section 7 of the Advocates Act, 1961. This includes the promotion of legal education and laying down standards of such education in consultation with universities in India and state bar councils. [There is also] a residuary clause, having the widest amplitude to do all other things necessary for discharging the aforesaid functions. These provisions do not entrust the Bar Council of India with direct control of legal education, as primarily legal education is within the province of the universities. Yet, the Bar Council of India, being the apex professional body of the advocates, is concerned with the standards of the legal profession and the equipment of those who seek entry into that profession. Neither these provisions nor the role of the universities to impart legal education, in any way, prohibit the Bar Council of India from conducting pre-enrolment examination, as the Council is directly concerned with the standard of persons who want to obtain a license to practice law as a profession…Along with the aforesaid provision, we would like to advert to the post-legal education stage for admission of advocates on the State roll. Section 24 of the said Act prescribes as to who are the persons who may be prescribed as Advocates on State roll. Clause (d) of Sub-Section (3) of Section 24 of the said Act refers to the entitlement to be enrolled as an Advocate under any rule made by the Bar Council of India on this behalf. It is under this provision that the Bar Council of India sought to introduce the All-India Bar Examination, which would be uniformly applicable irrespective of the recognised educational institutions from which a person would complete law before he was enrolled at the Bar. It is this endeavour of the Bar Council of India, which came to be assailed in the judgment of this Court in V. Sudeer v. Bar Council of India, (1999) 3 SCC 176, and that challenge succeeded. The judgment, though operative prospectively, opined that such rule-making power of the Bar Council of India was ultra vires the parent Act as it stood amended after the 1973 Amendment [which omitted a condition in Section 24(1)(d) requiring advocates wishing to enrol themselves to first undergo a course of training in law and pass an examination after such training both of which shall be prescribed by the state bar council]. Therefore, it was opined that a person, who is otherwise eligible for enrolment having qualified the law degree, could not be denied enrolment by prescribing additional qualifications of pre-enrolment training and an examination of enrolment as an Advocate. The reasoning, which permeates the judgments is that if statutorily the power of the state bar councils has been taken away in respect of a particular aspect i.e., either for providing training or for holding examination, the endeavour of the Bar Council of India to introduce a pre-enrolment examination could not be sustained as it would go contrary to the intent of the 1973 Amendment…We have to read the powers of the state bar councils and the Bar Council of India in the context of their respective statutory provisions. The powers are not pari materia. Bar Council of India has much larger powers and authority. We are unable to agree with the reasoning in V. Sudeer that because the state bar councils’ power for providing training or for holding examination was taken away by the 1973 Amendment, it ipso facto amounts to taking away such powers if they so vested with the Bar Council of India.” [Justice Sanjay Kishan Kaul in Bar Council of India v. Bonnie Foi Law College, 2023 LiveLaw (SC) 96]

11. Only those powers cannot be read by implication that are not already available

“We are unable to agree with the reasoning in V. Sudeer v. Bar Council of India, (1999) 3 SCC 176 that because the state bar councils’ power for providing training or for holding examination was taken away by the 1973 Amendment, it ipso facto amounts to taking away such powers if they so vested with the Bar Council of India. The legislative object was clear i.e., not to confer such powers on the state bar councils. However, that could not affect the position of the power of the Bar Council of India, and naturally such a power existed. If the Bar Council of India never had such a power, then the same could not be read by implication. But, if the Bar Council of India had sufficient powers, then the 1973 Amendment would not take away those powers of the Bar Council of India as the said amendment did not deal with the aspect of the powers of the Bar Council of India. In addition, the learned Judges in V. Sudeer opined that if such a power has to be conferred, it should be conferred legislatively. While in principle, there can be no disagreement with the broad proposition, the issue is whether such a power is already existing with the Bar Council of India under the statutory provisions.” [Justice Sanjay Kishan Kaul in Bar Council of India v. Bonnie Foi Law College, 2023 LiveLaw (SC) 96]

12. Bar Council of India has adequate powers to conduct pre-enrolment examination and training

“The functions of the Bar Council of India, as specified under Section 7, inter alia prescribe an exercise of general supervision and control over the state bar councils. Further, the Bar Council of India has the power to perform all other functions conferred on it by or under the said Act, as well as to do all other things necessary for discharging the aforesaid functions. The powers are, thus, wide and extensive as conferred by the legislature. Thus, when under Section 24(1), the Bar Council of India has the statutory power of prescribing Rules subject to which a person may be treated as qualified to be admitted as an Advocate in the State roll, then we believe that the Bar Council of India is not devoid of its jurisdiction in undertaking a pre-enrolment training course or examination prescribed by the Bar Council of India. In case of any subsisting doubt, we must refer to Section 49(1)(ag) of the said Act, which while dealing with the general powers of the Bar Council of India to make rules, specifically stipulates that the class or category of person entitled to be enrolled as advocates, is an aspect for which all powers have been conferred on the Bar Council of India. Thus, the provision for an examination for enrolment of advocates by the Bar Council of India can hardly be doubted…The objective of the legislature while giving wide powers to the Bar Council of India under Section 49, which gives it the powers to make rules, read with Section 24(3)(d), which gives it the powers to prescribe the norms for entitlement to be enrolled as an Advocate under the rules of the Bar Council of India, leads us to the conclusion that these are adequate powers with the Bar Council of India under the said Act to provide such norms and rules. We are, thus, of the view that while considering the questions referred to us, the only conclusion which can be laid is that the interdict placed by the judgment of this Court in V. Sudeer v. Bar Council of India, (1999) 3 SCC 176 on the powers of the Bar Council of India cannot be sustained and we cannot hold that this judgement lays down the correct position of law. The effect of the view expressed by us would be that it has to be left to the Bar Council of India as to at what stage the All-India Bar Examination has to be held – pre or post.” [Justice Sanjay Kishan Kaul in Bar Council of India v. Bonnie Foi Law College, 2023 LiveLaw (SC) 96]

13. Half-baked lawyers serve no purpose in the legal profession

“We have given our thought to the matter and share the concerns of all those who appeared before us to see that the best come into the profession. Quality of lawyers is an important aspect and part of administration of justice and access to justice. Half-baked lawyers serve no purpose. It is this quality control, which has been the endeavour of all the efforts made over a period of time...quality control of entry into the Bar is the need of the hour...Our hope is that the aforesaid observations while conferring a greater role on the Bar Council of India, would make the Bar Council of India more conscious of the importance of the role it has to perform, including ensuring that the only persons who are well equipped with the tools of law pass the All India Bar Examination...In the end, we hope that our view would assist in bringing forth the enrolment of young bright minds at the Bar, who would be able to assist the Court in a more efficient manner so that the administration of justice is benefited.” [Justice Sanjay Kishan Kaul in Bar Council of India v. Bonnie Foi Law College, 2023 LiveLaw (SC) 96]

14. Requirements of active legal practice and unconnected job different

“There may also be persons who despite being enrolled at the Bar, decide to take another job and come back into the profession after a considerable period of time, at times even post retirement. It is in that context that the amicus curiae has suggested that the rule making power of the said Act could be invoked requiring an examination for the advocates who come back into the practice after a substantial break from practice. We are inclined to accept the suggestion in principle that appropriate rules can be framed laying down that an enrolled advocate who takes up an employment in a non-legal context for a substantial length of time (say for five years) would be deemed to be a new enrolee and in order to regain the qualification, that person would be required to take the All-India Bar Examination once more. We believe that the requirements of an active legal practice and that of an unconnected job are different. Even if a person has a law degree or enrolment, it does not mean that his ability to assist the court would continue with him if there were long hiatus period of time in some unconnected job. He would have to hone and test his skills afresh. Thus, if there is a substantial break, norms should be specified by the Bar Council of India that to regain that qualification, the person would be subject to re-examination and would be required to take the All-India Bar Examination once more.” [Justice Sanjay Kishan Kaul in Bar Council of India v. Bonnie Foi Law College, 2023 LiveLaw (SC) 96]

15. Practice of state filing appeal against grant of death-cum-retirement gratuity must be deprecated

“The deceased was appointed as a Lecturer and would have completed 60 years of his age in June, 2011. As per Government Order in September 2009, he would have exercised his option to retire at the age of 60 years on or before July 2010, However, before he could exercise the option, unfortunately, he died. In fact, he had died even prior to the Government order. He had died in August 2009 whereas the Government order is dated September 16, 2009. Therefore, there was no chance for him to exercise any option at all. There is hence no merit in this appeal. The High Court has rightly observed that the respondent would be entitled to the benefit of the Government Order and would be entitled to the benefit of death-cum-retirement gratuity being the heirs of the deceased employee. The death-cum-retirement gratuity is the benevolent scheme and the same is extended to the respondent being heirs/dependent of the deceased employee by the learned Single Judge, confirmed by the Division Bench. In the facts and circumstances of the case, no interference of this Court is called for…We deprecate the practice of a State filing such cases before the Apex Court. Hence the appeal is dismissed with cost of Rs. 50,000/- payable by the appellant to the respondent within a period of four weeks from today.” [Justice M.R. Shah in State of Uttar Pradesh v. Smt. Priyanka, 2023 LiveLaw (SC) 95]