Aadrikaa Legal Services (ALS)- Law I Litigation I Arbitration
Date: 19.10.2026
Himachal Pradesh High Court Sets Aside Arbitration Order Over Commercial Court Jurisdiction
This Short Article has been prepared & written by Arbitrator Shobhit Mallik. The views expressed are based on his interpretation of the law. He can be reached at his email idshobhit.Ica23@gmail.com.
The Himachal Pradesh High Court has set aside a district court order in an arbitration dispute involving M/s Ech Ess Builders and the State of Himachal Pradesh, holding that the court lacked jurisdiction to decide the matter because it had not been constituted as a Commercial Court at the relevant time.
Background of the construction dispute
The dispute arose from a public works contract awarded in December 2005 to M/s Ech Ess Builders for a project valued at βΉ1.60 crore. The stipulated completion period was two years.
According to the contractor, the work was disrupted when the site began sliding during the 2010 monsoon season. It said that the work was stopped, cracks developed in the area, and no further execution instructions were provided despite repeated communications. The contractor also alleged that designs and drawings were not made available in time, contributing to the delay.
M/s Ech Ess Builders sought compensation for idle infrastructure and staff, additional overheads, unpaid work, price escalation, withheld security deposit, and earnest money. It also claimed costs and interest at 18% per annum.
Arbitration award and court proceedings
The arbitrator issued an award on 5 December 2019. Among other directions, the award granted simple interest at 8% per annum on:
βΉ4,46,039 from 27 November 2013 to 22 August 2019; and
βΉ2,52,492 from 27 November 2013 to 4 August 2017.
Both the State authorities and the contractor challenged the award under Section 34 of the Arbitration and Conciliation Act, 1996. On 9 August 2024, the District Judge, Kinnaur dismissed both sets of objections and upheld the arbitral award.
The State then appealed under Section 37 of the Arbitration and Conciliation Act. The High Court also condoned the delay in filing that appeal, accepting that it resulted from administrative processes rather than deliberate inaction.
Why the High Court intervened
Justice Sandeep Sharma held that this was a commercial dispute because it arose from a construction and infrastructure contract, which falls within the scope of the Commercial Courts Act, 2015.
The decisive issue was jurisdiction. When the Section 34 objections were filed in July 2020, the District Judge was not notified or constituted as a Commercial Court under Section 3 of the Commercial Courts Act. Commercial Courts at the district level in Himachal Pradesh were notified only in May 2026.
Relying on earlier High Court decisions, the Court concluded that a court not constituted as a Commercial Court cannot exercise jurisdiction over such commercial arbitration objections. As a result, the 2024 judgment was treated as having been passed without jurisdiction.
Courtβs order
The High Court did not examine the merits of the contractorβs claims or the Stateβs objections to the arbitration award. Instead, it:
set aside the District Judgeβs order dated 9 August 2024;
directed the District Judge to return the partiesβ Section 34 objections for presentation before the appropriate forum under the Commercial Courts Act; and
ordered that the period from filing the appeal until the parties receive a certified copy of the High Courtβs order will be excluded when calculating limitation.
Legal significance
The ruling reinforces that jurisdictional requirements under the Commercial Courts Act are mandatory in commercial arbitration matters. Even where a district court has considered an arbitral award in detail, its decision cannot stand if the court was not legally designated to hear commercial disputes when the case was instituted and decided.
For parties to government construction contracts, the decision highlights the importance of filing arbitration challenges before the correctly constituted commercial forum. Procedural defects in forum selection can invalidate years of litigation without resolving the underlying contractual dispute.
Aadrikaa Legal Services is a trusted legal and regulatory support partner providing end-to-end legal solutions to law firms, corporate organizations, and businesses across India. We specialize in paralegal services, litigation support, tax and regulatory matters, delivering reliable, efficient, and result-oriented legal assistance.
Our services include comprehensive paralegal support, drafting and documentation, legal research, case management, litigation handling, and representation support across various judicial and quasi-judicial forums. We also assist in direct and indirect tax matters, customs, GST, corporate regulatory compliance, and legal advisory.
Aadrikaa Legal Services (ALS)- Law I Litigation I Arbitration
Date: 19.10.2026
Karnataka High Court- False Promise of Marriage Cannot Be Treated as Consent
This Short Article has been prepared & written by Advocate G Sridharamurthy. The views expressed are based on his interpretation of the law. He can be reached at his email id sriadv3@gmail.com.
The Karnataka High Court has overturned a trial courtβs acquittal and convicted an accused of rape, cheating and criminal intimidation, holding that a sexual relationship induced by a false promise of marriage cannot be treated as consensual merely because the parties were in a relationship.
The case at a glance
In Manjula v. Devaraju and State of Karnataka (Criminal Appeal No. 2047 of 2018), a Division Bench of Justices H.P. Sandesh and B. Pramod set aside the 2018 acquittal issued by the V Additional District and Sessions Judge, Tiptur. The High Court found that the trial court had failed to properly assess the complainantβs testimony, her original complaint, the DNA evidence, and allegations of threats.
The accused was convicted under:
Section 417 IPC for cheating;
Section 376 IPC for rape; and
Section 506 IPC for criminal intimidation.
He was sentenced to life imprisonment for rape, along with prison terms and fines for the other offences. The sentences are to run concurrently.
Allegations and evidence before the Court
The complainant stated that she and the accused had known each other since their school days and were in a relationship. According to her complaint and testimony, the accused repeatedly assured her that he would marry her, told her he would not marry anyone else, and continued sexual relations on the strength of that assurance.
She alleged that after she became pregnant, the accused asked her to terminate the pregnancy. When she refused and pressed him to marry her, he allegedly refused and threatened her life. The complaint also referred to an earlier case and alleged that the accused had pressured her to withdraw it by continuing to promise marriage.
The High Court placed particular weight on a DNA report establishing that the accused was the biological father of the complainantβs daughter. The judgment notes that the accused did not effectively challenge the DNA evidence. Medical and investigative evidence, including the pregnancy finding and potency report, was also before the trial court.
Why the High Court rejected the acquittal
The trial court had treated the case as one involving consensual sexual relations, largely because the complainant acknowledged a love affair and prior physical relationship with the accused. The High Court held that this approach was incomplete and legally flawed.
The Court emphasized that the central issue was not simply whether the parties were in a relationship, but whether the complainantβs consent had been obtained through a promise of marriage that induced her to engage in sexual relations. It found that the trial court had not meaningfully considered:
the specific allegations in the original complaint;
the complainantβs testimony that the accused repeatedly promised marriage;
the allegation that he continued the relationship while asking her to withdraw an earlier complaint;
the DNA evidence confirming paternity; and
the accusation that he threatened her after she became pregnant and refused an abortion.
According to the High Court, the absence of physical injuries did not undermine the prosecution case. Where consent is obtained on the basis of a promise of marriage, the Court reasoned, physical injuries are not an expected indicator of the offence. It held that a continuing sexual relationship based on such a promise could not automatically be categorised as consensual sex.
Appellate courtβs finding: material evidence was overlooked
The High Court described the trial courtβs assessment as perverse because it did not properly evaluate key oral and documentary evidence. It found that the acquittal had resulted in a miscarriage of justice.
The Bench also noted that the trial court had not adequately addressed the elements of cheating under Section 417 or criminal intimidation under Section 506. The complaint and the complainantβs evidence contained specific allegations of deception and threats, but these were not substantively analysed in the acquittal judgment.
Relying on Supreme Court principles concerning appellate interference with acquittals, the High Court held that an appellate court may reverse an acquittal where cogent evidence has not been properly appreciated and the result is a miscarriage of justice.
Sentence and compensation directions
After conviction, the Court imposed the following sentence:
Section 417 IPC: One yearβs imprisonment and a fine of Rs. 1,00,000.
Section 376 IPC: Life imprisonment and a fine of Rs. 5,00,000.
Section 506 IPC: Two yearsβ imprisonment and a fine of Rs. 1,00,000.
The total fine is Rs. 7,00,000. If deposited, Rs. 5,00,000 is to be kept in a fixed deposit in the daughterβs name until she reaches adulthood. The remaining Rs. 2,00,000 is to be released to the complainant for her livelihood and for the childβs educational needs.
The Court also directed the District Legal Services Authority, Tumkur, to award maximum compensation to the complainant and her child within four months. It noted that the trial court had failed to consider victim compensation under Section 357A of the Code of Criminal Procedure, even while the complainant and child were facing hardship.
Maintenance order also noted
During the appeal, the Court was informed that a maintenance order had directed the accused to pay Rs. 2,000 each per month to the complainant and her daughter. The complainantβs side stated that this amount had not been paid, and the accused did not dispute that assertion. The High Court considered this conduct while determining sentence and compensation.
Broader legal significance
The ruling underscores that the existence of a romantic relationship does not, by itself, resolve the question of consent in a criminal case. Courts must closely examine whether consent was given freely or was induced by deception, particularly where a complainant alleges that sexual relations occurred because of a promise of marriage.
It also highlights the duty of trial courts to assess all material evidence, including the complaint, testimony, scientific evidence, and allegations of intimidation, rather than limiting their analysis to whether there was force or physical injury. The judgment further reinforces the importance of victim-compensation mechanisms, including in cases where a trial court initially records an acquittal.
Aadrikaa Legal Services is a trusted legal and regulatory support partner providing end-to-end legal solutions to law firms, corporate organizations, and businesses across India. We specialize in paralegal services, litigation support, tax and regulatory matters, delivering reliable, efficient, and result-oriented legal assistance.
Our services include comprehensive paralegal support, drafting and documentation, legal research, case management, litigation handling, and representation support across various judicial and quasi-judicial forums. We also assist in direct and indirect tax matters, customs, GST, corporate regulatory compliance, and legal advisory.
Aadrikaa Legal Services (ALS)- Law I Litigation I Arbitration
Date: 19.10.2026
Bombay High Court Says Merchant Settlement Funds Cannot Be Treated as Payment Aggregator Assets
This Short Article has been prepared & written by Advocate Madhumita Jha. The views expressed are based on her interpretation of the law. She can be reached at her email idjhamadhumita27@gmail.com.
The Bombay High Court has set aside provisional GST attachments on 1Pay Mobileware Private Limitedβs bank and escrow accounts, holding that the DGGI acted on suspicion without showing a specific GST liability or cogent material linking the payment aggregator to tax evasion.
Court finds Section 83 power was used without the required foundation
In 1Pay Mobileware Private Limited v. Union of India & Ors. (Writ Petition No. 4586 of 2026), decided on 16 October 2026, the Bombay High Court examined whether the Directorate General of GST Intelligence (DGGI) could freeze the accounts of an RBI-authorised payment aggregator during an investigation into alleged GST evasion by an online money-gaming syndicate.
The Court concluded that the attachment orders did not meet the strict statutory conditions under Section 83 of the Central Goods and Services Tax Act, 2017. It therefore allowed the writ petition and quashed the impugned attachment orders, including the continuing restrictions under the partial de-freezing orders.
Background: payment aggregatorβs accounts frozen during gaming-syndicate investigation
1Pay Mobileware is a company incorporated in 2019 and authorised by the Reserve Bank of India to operate as an online payment aggregator from May 2024. In June 2026, it also received authorisation to operate as an offline payment aggregator.
On 10 August 2026, DGGI officers sealed the companyβs Mumbai premises and provisionally attached several bank accounts under Section 83 of the CGST Act. These included current accounts and RBI-mandated escrow accounts maintained with HDFC Bank, ICICI Bank, Kotak Mahindra Bank and IDFC Bank.
DGGI alleged that 1Pay may have played a role beyond that of a payment intermediary in an organised online money-gaming network. According to the department, fictitious or non-functional merchants may have been onboarded to route and layer funds generated from gaming activities without payment of applicable GST.
The agency also relied on alleged non-cooperation in the investigation. It stated that the companyβs registered and additional business premises were locked, records were unavailable, its server was empty, and certain information sought through summons had not been furnished. DGGI said that approximately 88 merchants identified from the companyβs GSTR-1 data appeared to be non-existent or non-functional.
1Pay argued that the freeze paralysed legitimate payment settlements
The company contended that it was a regulated payment aggregator, comparable in function to other payment platforms, and that its escrow funds largely belonged to third-party merchants rather than to 1Pay itself. It submitted that the blanket freeze had disrupted settlement payments for government, public-sector and statutory bodies using its platform.
Among the entities identified as having unsettled funds were IRCTC, the Institute of Chartered Accountants of India, LIC Housing Finance, HDFC Bank and Tamil Nadu Power Finance and Infrastructure Development Corporation. The company also highlighted disruptions to FASTag and National Electronic Toll Collection settlements.
DGGI subsequently permitted limited settlement payments from one escrow account to specified government and PSU-linked entities. However, it continued the debit freeze over the accounts generally, stating that it was needed to safeguard revenue while the investigation continued.
Why the High Court set aside the attachments
The Court held that Section 83 authorises provisional attachment only after proceedings under the specified chapters of the CGST Act have been initiated and only where the Commissioner forms an opinion, based on tangible material, that attachment is necessary to protect government revenue.
Relying on the Supreme Courtβs decision in Radha Krishan Industries, the Court stressed that provisional attachment is a βdraconianβ power. It cannot be used merely because attachment seems convenient, expedient or commercially useful. The authority must demonstrate a live link between credible material, the proposed attachment and the necessity to protect revenue.
The Court identified several decisive deficiencies:
No identified GST liability of 1Pay: The attachment orders did not explain any tax liability attributable to the payment aggregator itself. The allegations broadly concerned suspected money laundering and GST evasion by unnamed third parties.
No particulars of alleged wrongful transactions: The orders did not identify the specific transactions, merchants, nature of GST evasion, or the companyβs alleged role in it.
No basis for treating 1Pay as a person covered by Section 83: The material did not show that 1Pay was a taxable person with a relevant liability or a person falling within Section 122(1A) of the CGST Act.
Escrow money was not 1Payβs property: The Court held that funds in the RBI-mandated escrow account were impressed with a trust and belonged to merchants and beneficiaries, not the payment aggregator. They could not be attached as the companyβs property under Section 83.
Orders could not be repaired through later affidavits: The Court said the deficiencies in the original attachment orders could not be justified by explanations added in DGGIβs affidavit filed during the writ proceedings.
Suspicion was not enough: Although the department cited non-cooperation and suspected involvement with 88 merchants, it did not disclose their identities, transaction details, or evidence showing 1Payβs involvement in any GST evasion.
The Court also noted that 1Pay serviced several government entities and could not be treated as a βfly-by-night operatorβ on the material before it.
Significance for payment aggregators and GST investigations
This judgment reinforces that GST authorities must exercise provisional attachment powers with exceptional care. An investigation or a general suspicion of wrongdoing does not, by itself, justify freezing operational bank accounts, particularly where the accounts hold third-party settlement funds.
For RBI-regulated payment aggregators, the ruling is especially significant because escrow accounts are designed to hold merchant funds pending settlement. Treating those balances as the payment aggregatorβs attachable property can disrupt payments to merchants, government bodies, banks and consumers while exceeding the limits of Section 83.
The decision also underlines three broader principles:
Specificity is essential: Authorities must identify the taxpayerβs own alleged liability and the factual basis for attachment.
Necessity and proportionality must be demonstrated: A freeze must be truly necessary to protect revenue, not simply useful for an ongoing inquiry.
Third-party funds require distinct treatment: Funds held in escrow for merchant settlement cannot automatically be treated as assets belonging to the payment intermediary.
Outcome
The Bombay High Court allowed 1Pay Mobilewareβs writ petition and quashed the challenged provisional attachment orders and continuing partial-freezing restrictions. No order as to costs was made. The ruling confirms that Section 83 cannot be used as an investigative shortcut: a provisional attachment requires credible, recorded material showing that the taxpayerβs own property must be frozen to protect a genuine revenue interest.
Aadrikaa Legal Services is a trusted legal and regulatory support partner providing end-to-end legal solutions to law firms, corporate organizations, and businesses across India. We specialize in paralegal services, litigation support, tax and regulatory matters, delivering reliable, efficient, and result-oriented legal assistance.
Our services include comprehensive paralegal support, drafting and documentation, legal research, case management, litigation handling, and representation support across various judicial and quasi-judicial forums. We also assist in direct and indirect tax matters, customs, GST, corporate regulatory compliance, and legal advisory.
Aadrikaa Legal Services (ALS)- Law I Litigation I Arbitration
Date: 18.10.2026
Delhi High Court Upholds DMRCβs Refusal to Reimburse Rs.4.46 Crore in DVAT to L&T
This Short Article has been prepared & written by Advocate Ravi Shekhar Jha-Delhi High Court, New Delhi. The views expressed are based on his interpretation of the law. He can be reached at his email id intelconsul@gmail.com .
The Delhi High Court has dismissed Larsen & Toubro Limitedβs challenge to an arbitral award that denied reimbursement of Rs.4.46 crore in Delhi Value Added Tax (DVAT) from Delhi Metro Rail Corporation Ltd. (DMRC), holding that the relevant supplies were connected to inter-State trade and import transactions and therefore fell outside DVAT.
The dispute: tax reimbursement under a metro contract
The case arose from a 2008 DMRC contract awarded to a consortium comprising Larsen & Toubro (L&T) and Furrer + Frey AG. The contract concerned the design, supply, installation, testing and commissioning of a 25 kV rigid overhead contact system and related cabling for sections of Delhi Metroβs Phase-II network.
The contract value was approximately Rs.43.37 crore, along with USD 2.02 million and Swiss Franc 5.49 million. It required the contractor to deliver and install equipment including contact wires, traction cables, sectioning posts, sub-sectioning posts, return conductors and associated systems.
A key contractual clause provided that DMRC would reimburse DVAT or Uttar Pradesh trade tax, where applicable, on indigenous equipment upon proof of actual payment. L&T argued that it had paid DVAT of Rs.4,45,73,743 on the equipment and systems supplied to DMRC in Delhi and was entitled to reimbursement.
Why L&T claimed DVAT reimbursement
L&T procured high-voltage and low-voltage panels, cables and other components from suppliers outside Delhi. Some high-voltage panels were imported from Germany by an Indian supplier, while certain other materials were obtained through inter-State transactions.
According to L&T, these components were not supplied to DMRC as standalone items. Instead, they were transported to project sites, assembled, integrated, installed and commissioned into sectioning and sub-sectioning posts and other bill-of-quantities items. L&T maintained that the completed systems were commercially distinct products supplied to DMRC in Delhi, making the transactions local sales subject to DVAT.
L&T also relied on two aspects of DMRCβs conduct:
DMRC initially reimbursed one DVAT invoice, though it later recovered the amount from L&Tβs running bills.
DMRC deducted works-contract tax at source from invoices, which L&T argued showed that DMRC had treated the supplies as local transactions.
DMRCβs position: the supplies were exempt from DVAT
DMRC argued that reimbursement was only available where DVAT was legally applicable. It contended that the goods were procured specifically for the metro project through imports and inter-State purchases, meaning that the transactions were exempt from DVAT under Section 7 of the DVAT Act.
DMRC relied on facts showing a close contractual connection between the goods and the project:
DMRC prescribed technical specifications for the equipment.
It approved the suppliers, including the foreign supplier of the high-voltage panels.
It required pre-inspection of goods.
The goods were custom-made for the metro project.
DMRC issued customs and excise-duty exemption certificates.
The invoices and packaging identified DMRC as the consignee or stated that the goods were for the DMRC project.
DMRC maintained that these facts established that the movement of goods into Delhi, whether from another State or from abroad, was occasioned by and integral to the underlying works contract.
Arbitration award: no reimbursement due
The arbitral tribunal rejected L&Tβs claim in its entirety and issued a nil award. It concluded that the imported high-voltage panels and the materials procured from outside Delhi were directly connected with the DMRC contract.
The tribunal found that the relevant domestic procurements were inter-State sales subject to Central Sales Tax, while the imported equipment was part of a transaction in the course of import. As these categories are excluded from DVAT under Section 7 of the DVAT Act, DMRC was not required to reimburse the tax paid by L&T.
The tribunal also held that DMRCβs initial reimbursement of one invoice and later recovery of that amount was a rectifiable mistake, not an admission that DVAT was properly payable. Since the principal claim failed, the tribunal rejected L&Tβs claims for interest and arbitration costs as well.
High Courtβs analysis: contractual tax disputes can be arbitrated
Before addressing the tax issue, the Court considered L&Tβs argument that an arbitral tribunal could not decide whether DVAT applied because taxability is a matter for statutory authorities.
The Court rejected that objection. It drew a distinction between disputes that require a binding statutory tax determination and disputes between contracting parties over tax reimbursement or allocation of tax liability. The latter category is contractual and can be resolved through arbitration.
Here, the dispute centred on whether DMRC was contractually obliged to reimburse DVAT under the relevant clause. The Court held that this was an arbitrable issue between the parties.
ABB precedent was decisive
The Court held that the case was squarely governed by the earlier decision in ABB Ltd., which had been affirmed by the Supreme Court. That precedent involved a DMRC works contract for electrical and traction systems and examined whether goods procured from outside Delhi or through import were subject to DVAT.
The governing test is whether the movement of goods is integrally connected with the contract for their supply. An express contractual clause requiring inter-State movement is not necessary. It is enough if the movement is pursuant to, or incidental to, the contract.
Applying this principle, the Court found a direct and continuing link between the procurement of the panels and other equipment and L&Tβs obligations to DMRC. The fact that L&T integrated the input materials into sectioning and sub-sectioning posts did not break that connection.
Limited judicial review under Section 34
The Court emphasised that a Section 34 petition is not an appeal against an arbitral award. A court cannot reassess the evidence merely because another interpretation may be possible. Intervention is warranted only on narrow grounds, such as patent illegality going to the root of the matter.
The tribunal had considered the relevant invoices, supplier approvals, customs exemptions, project specifications, consignment details and the partiesβ submissions. Its conclusion that the supplies were linked to inter-State trade and import was therefore a plausible view supported by the record.
Outcome and practical significance
The Delhi High Court dismissed L&Tβs petition, upheld the nil arbitral award and made no order on costs.
The ruling reinforces two important principles for infrastructure and works-contract disputes:
Tax reimbursement clauses depend on legal applicability. A contractual promise to reimburse VAT does not require reimbursement where the transaction is legally exempt from that State tax.
The contractual nexus of goods movement is critical. In projects involving customized equipment, approved suppliers, import-duty exemptions and project-specific consignments, the movement of goods may remain an import or inter-State transaction even after installation or integration into a larger system.
The decision also confirms that arbitrators may decide contractual disputes over which party must bear or reimburse tax, provided they are not purporting to replace the statutory tax authorities on matters that require a binding public-law tax determination.
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Aadrikaa Legal Services is a trusted legal and regulatory support partner providing end-to-end legal solutions to law firms, corporate organizations, and businesses across India. We specialize in paralegal services, litigation support, tax and regulatory matters, delivering reliable, efficient, and result-oriented legal assistance.
Our services include comprehensive paralegal support, drafting and documentation, legal research, case management, litigation handling, and representation support across various judicial and quasi-judicial forums. We also assist in direct and indirect tax matters, customs, GST, corporate regulatory compliance, and legal advisory.
Aadrikaa Legal Services (ALS)- Law I Litigation I Arbitration
Date: 17.10.2026
Rules of Origin vs. Rules of Customs: Constitutional Authority, Treaty Enforcement and the New CBIC Clarification
This Short Article has been prepared & written by Advocate Ravi Shekhar Jha-Delhi High Court, New Delhi. The views expressed are based on his interpretation of the law. He can be reached at his email id intelconsul@gmail.com .
From Article 253 of the Constitution to Section 28DA of the Customs Act: Understanding how international trade commitments become enforceable rights under Indian law.
Introduction: When International Trade Commitments Meet Domestic Customs Administration
India’s expanding network of Free Trade Agreements (FTAs) and Comprehensive Economic Partnership Agreements (CEPAs) has transformed the legal framework governing international trade. These agreements offer preferential market access, reduced Customs duties and enhanced commercial opportunities. However, their effective implementation depends upon a fundamental constitutional question: Can domestic Customs authorities impose conditions that dilute or defeat the benefits negotiated under a bilateral Trade Agreement?
This question has acquired renewed importance following CBIC Circular No. 43/2026-Customs, dated 24 September 2026. The Circular clarifies the relationship between Section 28DA of the Customs Act, 1962, the Customs (Administration of Rules of Origin under Trade Agreements) Rules, 2020 (CAROTAR), and the Rules of Origin contained in India’s Trade Agreements.
Its significance extends beyond routine Customs administration. It raises questions concerning constitutional treaty-making powers, legislative competence, delegated legislation, administrative discretion and the enforceability of international obligations within India’s domestic legal system.
The Circular specifically addresses two recurring disputes: the insistence upon Form-I for preferential tariff claims under the IndiaβUK Comprehensive Economic and Trade Agreement (CETA), and the automatic denial of preferential treatment to subsequent consignments following an earlier adverse origin determination.
By reiterating that agreement-specific Rules of Origin prevail over conflicting CAROTAR provisions, CBIC has reinforced an essential legal distinction between the authority to verify preferential claims and the power to impose additional substantive conditions.
To appreciate the Circular’s wider significance, it is necessary to examine the constitutional foundation of India’s bilateral trade agreements, the mechanism through which international obligations acquire domestic legal effect, and the judicial principles governing Customs exemptions and administrative interpretation.
I. Constitutional Foundation of Bilateral Trade Agreements in India
The Constitution of India does not contain a single provision exclusively governing Free Trade Agreements. Instead, India’s treaty-making and treaty-implementation powers arise from several interconnected constitutional provisions.
Article 51(c): Respect for International Law and Treaty Obligations
Article 51(c), contained in Part IV of the Constitution, directs the State to foster respect for international law and treaty obligations in dealings between organised peoples. This provision reflects India’s constitutional commitment to international cooperation and the observance of treaty obligations.
However, Article 51(c) forms part of the Directive Principles of State Policy. By virtue of Article 37, these principles are not directly enforceable by courts, although they remain fundamental to governance. Consequently, Article 51(c) does not independently transform an international trade agreement into an enforceable domestic statute.
Its principal significance lies in guiding constitutional interpretation and encouraging consistency between domestic law and India’s international commitments.
Article 73: Executive Authority to Negotiate and Conclude Trade Agreements
Article 73 defines the extent of the Union’s executive power. Read with Articles 53 and 246 and the relevant Union List entries, it provides the constitutional foundation for the Union executive’s authority in international relations.
Accordingly, the Central Government may negotiate and conclude bilateral and multilateral trade agreements within its constitutional competence. Such agreements may cover tariff concessions, market access, Rules of Origin, investment protection, services, intellectual property, technical barriers to trade and dispute-settlement arrangements.
However, an important distinction must be maintained between concluding an international agreement and giving its provisions enforceable domestic legal effect. An international agreement may bind India at the international level without automatically creating enforceable rights or obligations against private parties under Indian municipal law.
Where implementation requires alteration of existing legislation, restriction of legal rights or imposition of domestic obligations, appropriate legislative authority becomes necessary.
Article 253: Parliament’s Power to Implement International Agreements
Article 253 is the central constitutional provision concerning domestic implementation of international treaties. It empowers Parliament to legislate for implementing treaties, agreements and conventions with foreign countries, notwithstanding the ordinary distribution of legislative powers between the Union and States.
Its importance is twofold. First, it enables Parliament to implement international obligations through domestic legislation. Second, it permits Parliament to legislate even upon matters ordinarily falling within State legislative competence when implementing an international agreement.
Therefore, Article 253 acts as a constitutional bridge between international commitments and domestic legislative authority. However, Article 253 is an enabling provision. It does not automatically make every provision of a bilateral trade agreement directly enforceable in Indian courts.
The Supreme Court’s decision in Maganbhai Ishwarbhai Patel v. Union of India, AIR 1969 SC 783, remains particularly important in understanding this distinction.
Article 246 and the Seventh Schedule: Legislative Competence Over Foreign Trade
Article 246 distributes legislative competence between Parliament and State Legislatures.
Several entries in List I of the Seventh Schedule are directly relevant to bilateral trade agreements.
Constitutional provision
Subject matter
Relevance to international trade
Union List, Entry 10
Foreign affairs and matters concerning the Union’s relations with foreign countries
International economic relations and trade negotiations
Union List, Entry 14
Entering into treaties and agreements with foreign countries and implementing them
Constitutional legislative foundation for treaty implementation
Union List, Entry 41
Trade and commerce with foreign countries; import and export across Customs frontiers
Import-export regulation and foreign trade administration
Union List, Entry 83
Duties of Customs, including export duties
Customs tariff legislation and duty concessions
Article 253
Legislation implementing international agreements
Parliamentary authority extending beyond ordinary federal legislative limitations
These provisions collectively explain why international trade negotiations, Customs tariff legislation and foreign trade regulation principally fall within Union competence.
Articles 265 and 14: Constitutional Controls Over Customs Administration
Article 265 provides that no tax shall be levied or collected except by authority of law.
This principle is central to Customs taxation. An international agreement does not, merely through its execution, independently amend the Customs tariff or authorise Customs authorities to collect duties contrary to domestic law.
Preferential tariff treatment must be implemented through a legally valid domestic mechanism. Conversely, once a preferential concession has been lawfully implemented, its administration must remain within the governing statute and notification.
Article 14 introduces another constitutional limitation. Administrative decisions must not be arbitrary, discriminatory or unsupported by legally relevant considerations. Accordingly, Customs officers exercising powers under Section 28DA and CAROTAR remain subject to constitutional standards of legality, reasonableness and non-arbitrariness.
II. How Are Bilateral Trade Agreements Enforced Domestically in India?
India broadly follows a dualist approach to international treaties. Under this approach, international obligations and domestic legal rights operate in related but distinct legal spheres.
The execution of an international agreement does not necessarily make all its provisions directly enforceable against individuals or authorities. Domestic implementation may occur through legislation, statutory notifications, delegated legislation or executive action supported by existing law.
The Domestic Implementation Mechanism
1. Negotiation and conclusion of a Trade Agreement
Union executive authority under the Constitution
2. Identification of domestic legal requirements
Articles 246 and 253; relevant Union List entries
3. Implementation through Indian law
Customs Act, Customs Tariff Act, notifications and Rules of Origin
4. Administration of preferential tariff claims
Section 28DA, CAROTAR and the applicable Trade Agreement
5. Judicial review and statutory remedies
Customs appeals and constitutional remedies, where maintainable:-
In the Customs context, Section 5 of the Customs Tariff Act, 1975 enables the Central Government to make rules for determining the origin of goods under Trade Agreements. Preferential tariff concessions are generally implemented through notifications issued under the relevant statutory powers, including Section 25 of the Customs Act.
Section 28DA and CAROTAR then regulate the administration and verification of preferential claims. Thus, an FTA’s tariff commitments do not ordinarily operate as an independent substitute for India’s Customs legislation. Their domestic enforceability must be examined through the applicable implementing law.
III. Landmark Constitutional Precedent: Maganbhai Ishwarbhai Patel v. Union of India
Case: Maganbhai Ishwarbhai Patel v. Union of India Citation: AIR 1969 SC 783; (1969) 3 SCC 400 Court: Supreme Court of India Date: 9 January 1969
The dispute arose from the implementation of an international boundary determination involving India and Pakistan. The Supreme Court considered the constitutional powers of the Union executive to enter into international agreements and the circumstances requiring parliamentary legislation. The Court recognised that the executive could conclude international agreements within its constitutional authority.
However, it distinguished international obligations from their domestic legal consequences. Where implementation affects enforceable private rights or modifies existing domestic law, legislative support is required. The Court also explained the significance of Article 253 and Parliament’s authority to implement international agreements.
Commentary
Although the judgment concerned an international boundary dispute rather than an FTA, its constitutional reasoning remains directly relevant to trade agreements. It establishes that the Union executive’s treaty-making authority and Parliament’s treaty-implementation authority are legally distinct.
Consequently, a bilateral trade agreement cannot automatically override an inconsistent Indian statute merely because India has accepted the agreement internationally. The legally enforceable rights of importers must be identified through the applicable domestic implementing provisions, interpreted in light of the Trade Agreement where the law permits or requires such interpretation.
IV. Section 28DA of the Customs Act: The Statutory Framework for Preferential Origin
Section 28DA, introduced through the Finance Act, 2020, establishes the responsibilities of importers claiming preferential Customs duty under Trade Agreements.
The provision was intended to strengthen verification of originating status and prevent the misuse of preferential tariff concessions. Under Section 28DA(1), importers must declare that imported goods qualify as originating goods, possess sufficient supporting information, furnish prescribed particulars and exercise reasonable care regarding the accuracy of origin claims.
Section 28DA(2) makes it clear that the mere submission of a Certificate of Origin does not discharge the importer’s responsibility to exercise reasonable care. However, this provision cannot be interpreted in isolation.
Section 28DA(3) contemplates requests for further information consistent with the relevant Trade Agreement. This qualification is important because different agreements prescribe different documentary and verification procedures.
Section 28DA also establishes mechanisms for origin verification, suspension of preferential treatment, provisional clearance and denial of preferential benefits in specified circumstances. Subsection (11) addresses subsequent imports of identical goods following an earlier adverse origin determination. Importantly, the statutory framework does not confer unrestricted authority upon Customs to disregard agreement-specific origin procedures.
V. CAROTAR, 2020: Procedural Compliance and the Limits of Delegated Legislation
CAROTAR, 2020 was notified through Notification No. 81/2020-Customs (N.T.), dated 21 August 2020, and came into effect on 21 September 2020.
The Rules provide a domestic administrative mechanism for implementing Section 28DA. Rule 3 governs preferential tariff claims at the Bill of Entry stage. Rule 4 addresses the information importers must possess, including origin-related information identified in Form-I.
Rule 5 governs requests for further information. Rule 6 provides for verification through the prescribed authorities, while Rule 7 addresses identical goods and earlier adverse origin determinations.
Rule 8 deals with additional administrative matters, including consequences of non-compliance.
Rule 8(3): The Most Important Provision
Rule 8(3) expressly provides that where CAROTAR conflicts with the Rules of Origin under the relevant Trade Agreement, the latter shall prevail. This creates a specific rule of precedence within the domestic regulatory framework.
Its legal effect should be carefully understood. Rule 8(3) does not establish that every international treaty automatically overrides Indian legislation. Rather, it is a domestic legal provision expressly recognising the precedence of agreement-specific Rules of Origin over conflicting CAROTAR requirements.
The distinction is constitutionally significant. The authority of the Trade Agreement’s Rules of Origin in this context flows through the statutory framework enacted and notified under Indian law. Accordingly, Customs officers cannot disregard Rule 8(3) while administering preferential tariff claims.
VI. CBIC Circular No. 43/2026: Five Major Legal Clarifications
1. Valid Origin Declaration Under IndiaβUK CETA
Paragraph 2.1.1 recognises an Origin Declaration completed by the UK exporter or producer in the prescribed manner as proof of origin.
Therefore, a claim supported by a valid Origin Declaration must be processed without requiring Form-I. This clarification protects importers from an additional routine documentary requirement. However, the declaration must satisfy the applicable agreement’s conditions, and the goods must qualify under the relevant Rules of Origin.
2. Form-I Cannot Be a Routine Precondition
Paragraph 2.1.2 clarifies that Form-I is not required to be submitted with the Bill of Entry. Customs cannot treat its submission as a mandatory precondition for preferential tariff treatment. Nevertheless, the Circular does not abolish Form-I or eliminate lawful requests for origin-related information.
3. Requests for Form-I Information Are Restricted
Paragraph 2.1.3 identifies two cumulative conditions for seeking relevant Form-I information under the clarification concerning IndiaβUK CETA.
The Bill of Entry must have been interdicted by the National Risk Management System for origin-related checks, and the proper officer must have reason to believe that the applicable origin criteria have not been satisfied. The words used in the Circular limit routine administrative discretion. However, other verification powers lawfully available under the governing framework remain subject to their respective statutory conditions.
4. Confidential Commercial Information Is Protected
Paragraph 2.1.4 clarifies that IndiaβUK CETA importers need not obtain confidential information from exporters or producers.
Failure to furnish such information cannot, by itself, justify denial of preferential treatment. The importer must nevertheless provide information made available by the exporter or producer. Where the information remains insufficient, verification may be undertaken through the exporting Party’s Verification Authority in accordance with the Trade Agreement.
Paragraphs 2.2.1 to 2.2.3 address Section 28DA(11).
The Circular rejects the assumption that goods are identical merely because they share an HSN classification, description, exporter, producer or technical characteristics.
Before applying an earlier adverse determination, Customs must provide the importer an opportunity to furnish additional information. Where material origin-related facts differ, the current claim must be independently examined. This safeguard is particularly relevant to industrial imports involving changing suppliers, production arrangements, originating inputs and manufacturing processes.
VII. Supreme Court Judgments from 2025: Their Relevance to Customs Exemptions and Administrative Powers
The following decisions were delivered within the preceding two years. Their holdings are relevant to the broader legal principles involved, although neither directly adjudicates Circular No. 43/2026.
A. M/s L.G. Electronics India Private Limited v. Commissioner of Customs
Court: Supreme Court of India Decision: 10 September 2025 Proceedings: Civil Appeal Nos. 10349β10350 of 2024
The Supreme Court allowed LG Electronics India Pvt. Ltd.βs customs appeals concerning the import classification of G Watch smartwatches.
While it did not decide the classification dispute, the Court held that LG was eligible for the Korea-origin duty exemption based on the Certificate of Origin, set aside the CESTAT and original orders, and directed refund of the duty paid with applicable interest within two months.
Legal commentary: The Supreme Court rightly distinguished tariff classification from entitlement to a preferential-origin exemption, holding that an incorrect claimed classification cannot defeat a substantive benefit otherwise established by a valid Certificate of Origin. While leaving the smartwatch classification issue open, the ruling reinforces that customs adjudication must prioritize proven statutory conditions over technical errors made in good faith.
B. Noble Resources and Trading India Private Limited v. Union of India & Others
Citation: 2025 INSC 684 Court: Supreme Court of India Decision: 14 May 2025 Proceedings: Civil Appeal No. 2572 of 2025
The dispute concerned an exemption claimed on imported crude degummed soyabean oil under the applicable Duty Free Credit Entitlement framework.
The Department relied upon a Customs circular to extend an exclusion concerning agricultural and dairy products to certain manufactured products derived from agricultural commodities. The Supreme Court rejected the enlarged interpretation and held that the departmental circular could not expand the exclusion beyond the governing notification.
The Court allowed the importer’s appeal.
Legal commentary: This decision reinforces the principle that executive circulars cannot alter the substantive scope of statutory exemptions. Although the case did not concern Section 28DA or FTA origin verification, its reasoning is relevant where departmental instructions purport to impose restrictions beyond the governing legal instrument. The decision also demonstrates the importance of distinguishing a statutory condition from an administrative interpretation.
C. The Constitutional Connection
The decisions in Maganbhai, L.G. Electronics and Noble Resources operate at different levels. Maganbhai addresses the constitutional relationship between international agreements and domestic legislation.
L.G. Electronics concerns the examination of preferential Customs exemption entitlement. Noble Resources addresses the limits of departmental circulars in interpreting statutory exemptions.
Taken together, these authorities support the proposition that Customs administration must operate within the authority conferred by Indian law. They do not establish an unrestricted supremacy of FTAs over Parliament’s legislation. Instead, they reinforce lawful implementation, proper statutory interpretation and limitations on executive action.
VIII. Constitutional and Administrative Limitations on Customs Discretion
The Circular raises several questions concerning the lawful exercise of Customs powers. Under Article 265, Customs duty must have legal authority. Consequently, tariff concessions and their withdrawal must be examined within the applicable statutory framework.
Article 14 requires administrative action to satisfy constitutional standards against arbitrariness. Article 19(1)(g), subject to Article 19(6), protects the right of citizens to practise professions and carry on occupations, trade or business. This does not eliminate lawful import restrictions, but it may be relevant where administrative action unjustifiably interferes with protected commercial activity.
Article 226 empowers High Courts to exercise judicial review over unlawful administrative action, subject to principles governing the availability of alternative statutory remedies.
Therefore, Customs action concerning preferential tariff claims may raise constitutional issues where it exceeds statutory authority, disregards mandatory procedures or violates principles of natural justice. However, not every disagreement concerning an origin determination constitutes a constitutional violation.
Ordinary disputes involving documentary sufficiency, factual origin criteria or assessment may appropriately fall within the Customs Act’s statutory appellate framework. The constitutional remedy becomes particularly relevant where the challenge concerns jurisdictional error, procedural illegality, violation of natural justice or the validity of subordinate legislation.
IX. Inclusions, Exclusions, Limitations and Discretions: A Consolidated Legal Position
Category
Legal position
Constitutional inclusion
Articles 73 and 253 provide distinct foundations for treaty-making and legislative implementation.
Legislative inclusion
Customs Act and Customs Tariff Act provisions provide mechanisms for domestic administration of trade commitments.
Preferential origin inclusion
Valid agreement-prescribed origin documents support preferential claims.
Procedural exclusion
Form-I cannot be imposed routinely as a prerequisite under the IndiaβUK CETA clarification.
Confidentiality exclusion
IndiaβUK CETA importers need not obtain confidential exporter or producer information.
Statutory limitation
Importers must exercise reasonable care and satisfy substantive origin requirements.
Treaty limitation
International agreements do not automatically override inconsistent Indian primary legislation.
Administrative limitation
CAROTAR cannot override conflicting Rules of Origin under the applicable Trade Agreement, as recognised by Rule 8(3).
Customs discretion
Origin-related information and verification may be sought within the prescribed conditions.
Identical-goods safeguard
Earlier adverse determinations cannot be applied mechanically without considering relevant origin facts and additional information.
Judicial safeguard
Unlawful administrative action may be challenged through statutory remedies or constitutional judicial review, as appropriate.
X. A Constitutional Question for Future Litigation
One of the most significant questions emerging from this framework is whether a delegated rule, administrative instruction or Customs assessment can impose requirements inconsistent with the Rules of Origin incorporated into India’s domestic legal framework.
The answer requires identifying the precise legal source of each obligation. Where an agreement-specific rule has been implemented under the Customs Tariff Act, the officer must consider that rule alongside Section 28DA and CAROTAR. Where CAROTAR itself expressly gives precedence to the Trade Agreement’s Rules of Origin, administrative authorities must respect that prescribed hierarchy.
Where a conflict arises between an international commitment and primary parliamentary legislation, the analysis is different. The international agreement does not automatically invalidate or override the statute. The constitutional distinction is fundamental.
The enforceability of preferential trade benefits in India rests not merely upon diplomatic commitments but upon their lawful incorporation and administration under the Indian legal system.
Consequently, future litigation may increasingly examine whether origin-verification demands are supported by statutory authority, whether they comply with the applicable Trade Agreement, and whether administrative discretion has been exercised for a legitimate legal purpose.
XI. The Role of Aadrikaa Legal Services in Corporate Legal Support and Case Research
Aadrikaa Legal Services (ALS) assists large corporates, in-house legal departments, law firms and professional advisory organisations with specialised paralegal support and legal research relating to Customs, GST, Foreign Trade Policy, international trade compliance and regulatory disputes. Its support may include case-law research, statutory interpretation, preparation of legal research notes, compilation of judicial precedents, document examination, litigation chronologies, drafting assistance, regulatory compliance reviews and preparation of case briefs for counsel.
By combining legal research with domain-specific knowledge of Customs and trade regulations, ALS aims to support corporate legal teams and law firms in managing complex regulatory matters, developing litigation strategies and preparing well-researched submissions before statutory and judicial forums.
XII. Conclusion: The Constitution Sets the Boundary, Parliament Creates the Framework, and Customs Must Follow the Law
CBIC Circular No. 43/2026-Customs is more than a procedural clarification concerning Form-I and Rules of Origin. It highlights the constitutional relationship between India’s international trade commitments and their domestic implementation.
Articles 73 and 253 establish the foundations of treaty-making and legislative implementation. Articles 246 and 265 define the relevant legislative and taxation framework, while Article 14 imposes constitutional limitations upon administrative action.
Section 28DA and CAROTAR provide the domestic machinery for administering preferential tariff claims. However, Rule 8(3) expressly recognises that conflicting CAROTAR provisions must yield to the applicable Trade Agreement’s Rules of Origin.
The Supreme Court’s decisions in Maganbhai, L.G. Electronics and Noble Resources illuminate the constitutional and statutory principles that govern this relationship. The essential legal conclusion is that Customs authorities retain the power to verify originating status, prevent misuse of preferential concessions and protect public revenue.
What they cannot do is transform procedural authority into an independent power to impose substantive conditions unsupported by the governing law.
For importers, the Circular provides meaningful procedural protection. For Customs authorities, it reinforces the requirement of agreement-consistent administration. For legal practitioners, it offers a framework for examining origin disputes through statutory interpretation, delegated legislation and constitutional principles.
Ultimately, India’s international trade commitments can deliver their intended commercial benefits only when their domestic implementation remains legally coherent, transparent and consistent with the constitutional rule of law.
About the Author
Advocate Ravi Shekhar Jha is a New Delhi-based legal professional practising in matters involving Customs, indirect taxation, constitutional law, international trade and regulatory compliance, including matters before the Delhi High Court and statutory tribunals.
With approximately two decades of experience in international trade, regulatory advisory and supply-chain compliance, his professional work encompasses Customs classification and valuation, Free Trade Agreements, Rules of Origin, DGFT and Foreign Trade Policy matters, BIS and Quality Control Orders, trade remedies, and Customs litigation.
He holds an LL.M. in Constitutional Law and is associated with Aadrikaa Legal Services (ALS), which provides legal advisory, litigation, research and regulatory support to corporate clients and professional organisations.
Aadrikaa Legal Services is a trusted legal and regulatory support partner providing end-to-end legal solutions to law firms, corporate organizations, and businesses across India. We specialize in paralegal services, litigation support, tax and regulatory matters, delivering reliable, efficient, and result-oriented legal assistance.
Our services include comprehensive paralegal support, drafting and documentation, legal research, case management, litigation handling, and representation support across various judicial and quasi-judicial forums. We also assist in direct and indirect tax matters, customs, GST, corporate regulatory compliance, and legal advisory.
Aadrikaa Legal Services (ALS)- Law I Litigation I Arbitration
Date: 17.10.2026
Supreme Court: Conscious Possession Must Be Established for Conviction Under Section 15 of NDPS Act
This Short Article has been prepared & written by Advocate Ravi Shekhar Jha-Delhi High Court, New Delhi. The views expressed are based on his interpretation of the law. He can be reached at his email id intelconsul@gmail.com .
The Supreme Court of India dismissed the State of Punjabβs appeal against the acquittal of Hari Singh and other accused, holding that a failure to question them on the central allegation of conscious possession under Section 313 of the Code of Criminal Procedure (CrPC) materially weakened the prosecutionβs case.
Case at a glance
In State of Punjab v. Hari Singh & Ors., the respondents had initially been convicted under Section 15 of the Narcotic Drugs and Psychotropic Substances Act, 1985 (NDPS Act). The trial court sentenced each accused to 10 yearsβ rigorous imprisonment and imposed a fine of Rs. 1,00,000.
The prosecution alleged that police officers found the accused sitting on 16 gunny bags of poppy husk, each weighing 30 kilograms, near sugarcane fields on 9 July 1999. The accused were arrested after the bags were searched in the presence of a Deputy Superintendent of Police, following their request for the presence of a Gazetted Officer.
The Punjab and Haryana High Court later acquitted the accused. The State challenged that acquittal before the Supreme Court.
The central legal issue: conscious possession
Section 15 of the NDPS Act penalizes unlawful possession of poppy straw. The Court emphasized that possession in this context is not limited to physical custody. For criminal liability, the prosecution must establish conscious possession: possession coupled with awareness and the required mental element.
The judgment explains that βpossessionβ can take different forms depending on the circumstances. It may be:
Physical possession, where a person directly holds or carries an article; or
Constructive possession, where a person has the power and control to deal with the article even if it is not physically on them.
The Court noted that the evidence in this case, including the allegation that the accused were sitting on the bags, was relevant to conscious possession. Under Sections 35 and 54 of the NDPS Act, statutory presumptions may arise once possession is established. A person claiming that possession was not conscious may need to explain circumstances particularly within their knowledge.
However, proving or relying on possession was not enough by itself. The accused had to be given a fair opportunity to respond to that allegation.
Why the Section 313 CrPC examination was decisive
The Supreme Court found that the accused were not asked any question during their examination under Section 313 CrPC about possession or conscious possession of the contraband.
Section 313 requires the court, after the prosecution evidence closes, to question the accused so they can personally explain circumstances appearing against them. This is a core safeguard in a criminal trial, not a procedural formality.
The Court reaffirmed several principles:
Every material incriminating circumstance should be put to the accused. This allows a meaningful explanation or defence.
A circumstance not put to the accused ordinarily cannot be used against them.
The purpose is fairness. The provision gives effect to the natural-justice principle that a person must have an opportunity to answer the case against them.
Prejudice matters. An omission does not automatically invalidate every trial, but a conviction cannot safely rest on a vital fact that the accused were never asked to explain.
Here, conscious possession was the essence of the accusation under the NDPS Act. Because that crucial issue was omitted from the Section 313 examination, the omission was held to have a vital effect on the prosecution case.
The Courtβs guidance on personal appearance under Section 313
The judgment also discussed when an accused must personally appear to answer Section 313 questions. The general rule is that the accused should be personally examined, particularly in cases more serious than summons cases.
Still, the Court endorsed a limited practical exception for genuine hardship. If an accused already exempted from personal appearance cannot attend because of substantial expense, physical incapacity, or another justified difficulty, the court may permit written answers through a questionnaire.
This alternative requires safeguards, including:
A written application supported by the accusedβs own affidavit explaining the difficulty.
An assurance that the accused will not suffer prejudice from the arrangement.
An undertaking not to challenge the exemption later.
Personally authenticated answers, signed by the accused on every page and returned within the deadline fixed by the court.
The Court stressed that this is an exceptional arrangement. It cannot become a way for counsel to substitute their own answers for the accusedβs statement.
Outcome of the appeal
The Supreme Court upheld the High Courtβs acquittal and dismissed the State of Punjabβs appeal. It concluded that, despite evidence bearing on conscious possession, the failure to put that essential allegation to the accused under Section 313 CrPC justified refusing to interfere with the acquittal.
The Court did remove one part of the High Courtβs order: directions to initiate action against certain officials were expunged because such directions should not have been issued while deciding the criminal appeal.
Key takeaway
This decision shows that even in serious NDPS prosecutions, procedural fairness remains indispensable: a conviction cannot rely on a decisive incriminating circumstance, such as conscious possession, unless the accused has been given a proper opportunity to explain it under Section 313 CrPC.
Aadrikaa Legal Services is a trusted legal and regulatory support partner providing end-to-end legal solutions to law firms, corporate organizations, and businesses across India. We specialize in paralegal services, litigation support, tax and regulatory matters, delivering reliable, efficient, and result-oriented legal assistance.
Our services include comprehensive paralegal support, drafting and documentation, legal research, case management, litigation handling, and representation support across various judicial and quasi-judicial forums. We also assist in direct and indirect tax matters, customs, GST, corporate regulatory compliance, and legal advisory.
Aadrikaa Legal Services (ALS)- Law I Litigation I Arbitration
Date: 17.10.2026
Delhi HC: ROC Approval Does Not Validate a Corporate Name That Violates Companies Act
This Short Article has been prepared & written by Advocate Ravi Shekhar Jha-Delhi High Court, New Delhi. The views expressed are based on his interpretation of the law. He can be reached at his email id intelconsul@gmail.com .
The Delhi High Court directed Mondelez India Private Limited to adopt a different corporate name after finding that its use of βMondelezβ was deceptively similar to the pre-existing name of Mondelez Foods Private Limited.
Background of the dispute
Mondelez Foods Private Limited, incorporated on 28 May 2012, challenged the Registrar of Companiesβ approval of a name change by Nonstop Logistics India Private Limited to βMondelez India Private Limited.β The new certificate of incorporation was issued on 11 September 2012.
The petitioner argued that βMondelezβ was a distinctive and coined term associated with the Mondelez group and its trademark rights. It stated that it was authorized to use the name and that the later adoption by the other company was intended to exploit the established reputation connected with the word.
Documents submitted for the name-change request recorded that the company sought the new name because its directors considered it βlucky for business transactions.β The petitioner also noted that the company applied to register a βMondelezβ logo for similar goods.
Earlier action and rejection by the Regional Director
Before approaching the High Court, Mondelez Foods Private Limited sent legal notices and filed a rectification representation under Section 22 of the Companies Act, 1956. The Regional Director rejected the representation on two principal grounds:
The petitioner was not itself the registered proprietor of the βMondelezβ trademark.
More than 12 months had passed since the registration of the changed corporate name.
Separately, Intercontinental Great Brands, LLC, formerly known as Kraft Foods Global Brands, LLC, and Mondelez Foods Private Limited obtained a decree in a civil suit on 24 July 2014. That decree restrained the company and related defendants from using βMondelezβ as a trademark, trade name, corporate name, or part of a corporate name.
Courtβs findings
Justice Vibhu Bakhru observed that the respondent company did not appear to contest the petition. As a result, the petitionerβs allegations about the respondentβs conduct and intent remained uncontroverted.
The Court held that the adoption of βMondelezβ was dishonest and mala fide. It emphasized that βMondelezβ is a coined and distinctive word, as well as a prominent part of both companiesβ names. The Court therefore found the names deceptively similar.
Under Section 20 of the Companies Act, 1956, a company cannot be registered under an undesirable name. A name may be considered undesirable if it is identical with or too nearly resembles the name of an existing company or a registered trademark. The Court found that the respondentβs name fell within this prohibition and should not have been registered by the Registrar of Companies.
Effect of the Companies Act, 2013
The Court noted uncertainty in the wording of Section 22 of the 1956 Act, particularly concerning the 12-month period for a direction to change a company name. However, it considered the newer Companies Act, 2013, which empowers the Central Government to direct a company to change a name that is identical with or too nearly resembles a previously registered company name.
Because βMondelez India Private Limitedβ too closely resembled βMondelez Foods Private Limited,β the Court concluded that the Regional Director had the authority to require a correction.
Final order
On 7 July 2017, the Delhi High Court directed the Regional Director to issue the necessary instructions requiring Mondelez India Private Limited to change its name. The replacement name must not be identical with or resemble the petitionerβs name or that of any other existing company.
The company and its directors were also expressly directed to ensure compliance with the name-change requirement.
Why the ruling matters
The decision reinforces that company-name registration is not a mere administrative formality. A distinctive pre-existing corporate identity can be protected where a later name is confusingly similar, particularly when the record indicates dishonest adoption. It also illustrates the interaction between company-name law and trademark protection in preventing misleading corporate identities.
Aadrikaa Legal Services is a trusted legal and regulatory support partner providing end-to-end legal solutions to law firms, corporate organizations, and businesses across India. We specialize in paralegal services, litigation support, tax and regulatory matters, delivering reliable, efficient, and result-oriented legal assistance.
Our services include comprehensive paralegal support, drafting and documentation, legal research, case management, litigation handling, and representation support across various judicial and quasi-judicial forums. We also assist in direct and indirect tax matters, customs, GST, corporate regulatory compliance, and legal advisory.
Aadrikaa Legal Services (ALS)- Law I Litigation I Arbitration
Date: 17.10.2026
Bombay HC: Builders Cannot Collect More Than 10% of Flat Price Without Registered Sale Agreement β RERA Section 13 Compliance Mandatory
This Short Article has been prepared & written by Advocate Narendra Singh. The views expressed are based on his interpretation of the law. He can be reached at his email idamitnaren@outlook.com.
The Bombay High Court has directed Rare Townships Pvt. Ltd. to execute and register a RERA-compliant agreement for sale within four weeks, while treating 4 October 2024 as a tentative possession date pending final determination by the Maharashtra Real Estate Appellate Tribunal.
Background of the dispute
The dispute concerns a residential flat in the developerβs Ghatkopar project, originally marketed as βRising Cityβ and later registered under RERA as βNorth Sea Heights (A-1).β
The buyers initially received a holding receipt in January 2011 for a different flat. The parties subsequently changed the unit, and a provisional allotment letter dated 30 November 2014 was issued for Flat No. 805 in Building A-1, with a stated consideration of Rs. 1.248 crore.
The parties ultimately agreed that the buyers had paid Rs. 38.47 lakh by 2016. Despite this payment, no registered agreement for sale was executed. The core disagreements included the unpaid balance, the agreementβs terms, the possession timeline, parking and amenities, and each sideβs liability for delay.
RERA authorityβs earlier directions
In July 2025, MahaRERA partly allowed the buyersβ complaint. It required the developer to execute a registered agreement for sale under Section 13 of the Real Estate (Regulation and Development) Act, 2016, based on the allotment letter.
MahaRERA also held that:
The buyers would pay the outstanding consideration and any applicable interest for delayed payments under the statutory framework.
The developer would pay interest for delayed possession from 4 October 2024 until it offered possession with an Occupation Certificate.
The partiesβ respective payment obligations could be adjusted and set off when possession was delivered.
The buyers appealed for a more complete RERA-compliant agreement, including parking, amenities, model-agreement protections and safeguards against payment demands or termination before registration.
Interim tribunal order and developerβs challenge
The Appellate Tribunal initially directed the developer to provide and execute a RERA-compliant agreement. It also restrained the developer from demanding further money or issuing termination notices until the agreement was executed and registered. A review order corrected the buyersβ payment figure to Rs. 38.47 lakh and corrected the allotment-letter date.
Rare Townships challenged the interim order in the High Court. Its principal objection was that the Tribunal had effectively decided disputed issues at an interim stage, particularly by requiring the agreement to state a possession date and by excluding interest for alleged payment delays before the agreementβs execution.
High Courtβs reasoning
The Court emphasized that a registered agreement for sale is not optional once substantial sums have been accepted from a buyer. It noted that both the earlier Maharashtra Ownership Flats Act framework and RERA seek to prevent promoters from accepting significant advances without documenting the partiesβ rights and obligations in a registered agreement.
Under Section 13 of RERA, a promoter cannot accept more than 10% of an apartmentβs cost before entering into a registered written agreement for sale. The agreement must cover key matters, including project specifications, payment schedules, the possession date and default interest.
Here, the Court found that the developer had accepted more than 30% of the agreed consideration without executing the agreement. It therefore upheld the essential requirement to execute a registered, RERA-compliant agreement.
The Court drew a distinction, however, between requiring an agreement and conclusively determining the contractual possession date. The possession date remained an issue in the buyersβ pending appeal before the Appellate Tribunal. The High Court therefore modified the interim arrangement rather than treating that issue as finally settled.
Final directions
The Court disposed of the second appeal with these principal directions:
Tentative possession date: The agreement must record 4 October 2024 as the possession date.
No final determination: That date is tentative, without prejudice to either side, and remains subject to final adjudication by the Appellate Tribunal.
Rectification if required: If the Tribunal changes the possession date, the partiesβ rights and liabilities will follow that determination and they must execute a deed of rectification.
RERA-compliant agreement: The agreement must comply with Section 13 of RERA and the prescribed model agreement under Maharashtraβs 2017 RERA Rules.
Time limit: The developer must execute and register the agreement within four weeks of the judgment.
Issues kept open: All remaining disputes, including payment, interest, parking, amenities, compensation and the final possession timeline, remain open before the Appellate Tribunal.
Why the decision matters
The ruling reinforces that developers cannot retain substantial buyer payments while postponing the registered agreement for sale. It also confirms that a RERA-compliant agreement must transparently state essential commercial terms, including payment obligations, possession and default consequences.
At the same time, the judgment preserves procedural fairness: an interim order can secure the statutory agreement and protect buyers from premature demands or termination, but contested issues such as the final possession date must remain available for full appellate adjudication.
Aadrikaa Legal Services is a trusted legal and regulatory support partner providing end-to-end legal solutions to law firms, corporate organizations, and businesses across India. We specialize in paralegal services, litigation support, tax and regulatory matters, delivering reliable, efficient, and result-oriented legal assistance.
Our services include comprehensive paralegal support, drafting and documentation, legal research, case management, litigation handling, and representation support across various judicial and quasi-judicial forums. We also assist in direct and indirect tax matters, customs, GST, corporate regulatory compliance, and legal advisory.
Aadrikaa Legal Services (ALS)- Law I Litigation I Arbitration
Date: 17.10.2026
Bombay High Court Holds That Non-Recovery of a Journey Ticket Does Not Defeat Railway Accident Compensation Claim
This Short Article has been prepared & written by Advocate Madhumita Jha. The views expressed are based on her interpretation of the law. She can be reached at her email idjhamadhumita27@gmail.com.
The Bombay High Court has awarded βΉ8,00,438.36 to the parents of a man who died after falling from a crowded local train, holding that the absence of a ticket for one leg of his journey did not by itself disprove that he was a bona fide passenger.
Background of the case
Bhaskar Kandh Panda and Prafulla, also known as Pranita Bhaskar Panda, sought compensation following the death of their son, Sandeep P. Panda, on 1 September 2015. According to their case, Sandeep travelled from Kurla to Belapur for personal work and later boarded a local train from Belapur toward Chhatrapati Shivaji Maharaj Terminus (CSMT) to meet a friend.
The parents said that the train was heavily crowded and that Sandeep, who was standing near the door, was pushed and fell between Kurla and Chunabhatti stations. He suffered severe head injuries and later died at Sion Hospital.
A railway ticket for the Kurla-to-Belapur journey was recovered from his wallet during the inquest. However, the ticket for the later Belapur-to-CSMT journey was not found.
Why the Railway Claims Tribunal rejected the claim
The Railway Claims Tribunal initially dismissed the parentsβ compensation application in March 2020. Although it accepted that Sandeep had fallen from a train and died in an untoward incident, it concluded that he was not a bona fide passenger because the ticket for the Belapur-to-CSMT leg was missing.
Central Railway defended that conclusion, arguing that the deceasedβs account of travel was unreliable and that standing near a train door amounted to negligence. It also contended that there was no eyewitness to establish the alleged fall.
High Courtβs findings
Justice Aarti Sathe found the Tribunalβs reasoning internally inconsistent. The Tribunal had already accepted the police material, inquest panchanama and railway records showing that Sandeep fell from a train between Kurla and Chunabhatti and died from the resulting injuries. It could not, the High Court held, deny compensation solely because one ticket was not recovered.
The Court relied on the Supreme Courtβs ruling in Union of India v. Rina Devi, which clarifies that a missing ticket does not automatically defeat a railway accident claim. A claimant may meet the initial burden by filing an affidavit setting out relevant facts, after which the burden shifts to the Railways to rebut the case through the surrounding evidence.
In this case, the parents had produced an affidavit and supporting records, while a valid one-way ticket was recovered from the deceased. The Railways did not produce sufficient evidence to establish that the death fell within any statutory exception under Section 124A of the Railways Act, 1989.
Key legal principles reaffirmed
A missing ticket is not conclusive: The absence of a ticket after a fatal railway accident cannot, by itself, establish that the deceased was travelling without authority.
Evidence must be assessed as a whole: The Court considered the recovered ticket, inquest record, police report, affidavit and finding that the death resulted from a train fall.
Negligence does not automatically bar compensation: The Railways did not prove that the case fell under an exception to statutory liability merely because the deceased was allegedly near the door of a crowded train.
Beneficial legislation requires a liberal approach: The Railways Actβs compensation provisions are intended to protect victims and dependants. Where two reasonable interpretations are possible, the one favouring the beneficiary should be preferred.
Compensation awarded
The High Court set aside the Tribunalβs dismissal and allowed the claim. It noted that compensation for death under the applicable rules had increased from βΉ4 lakh to βΉ8 lakh after the 2016 amendment.
Applying the principle that claimants should receive the higher of the applicable amounts, the Court awarded βΉ8,00,438.36. This amount reflects the original βΉ4 lakh compensation with interest at 9% per year from the accident date, which marginally exceeded the revised fixed compensation of βΉ8 lakh.
The award is to be divided equally between the deceasedβs father and mother. Central Railway must deposit the amount within eight weeks after receiving their bank details; any delay will attract further interest at 9% per annum.
Significance of the ruling
The decision reinforces that railway compensation claims cannot be rejected on technical grounds when the overall evidence supports an untoward railway incident. It also underscores the Railway Administrationβs obligation to rebut a credible claim rather than relying only on the non-recovery of a ticket after an accident.
For families pursuing compensation after railway accidents, the judgment highlights the importance of preserving available documents, filing a clear affidavit describing the journey and accident, and relying on inquest, police and railway records to establish the circumstances of the incident.
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Aadrikaa Legal Services (ALS)- Law I Litigation I Arbitration
Date: 17.10.2026
Karnataka High Court Quashes ITP Act Proceedings
This Short Article has been prepared & written by Advocate G Sridharamurthy. The views expressed are based on his interpretation of the law. He can be reached at his email id sriadv3@gmail.com.
The Karnataka High Court has quashed two criminal cases against Maxim K. Kurian after the State failed to show that the officers who conducted the raids were legally appointed as Special Police Officers under the Immoral Traffic (Prevention) Act, 1956.
The order, delivered by Justice H.P. Sandesh on 15 October 2026, disposed of Criminal Petition Nos. 5994 of 2019 and 272 of 2020. The cases arose from separate police cases in Mangaluru but involved the same legal issue: whether the investigating officers had the statutory authority required to investigate offences under the ITP Act.
The two cases
In the first petition, Kurian, identified as accused No. 5, sought to quash proceedings in C.C. No. 3260/2017. The case stemmed from Crime No. 8/2017 registered at Barke Police Station and alleged offences under Sections 3(1), 4, 5 and 8 of the ITP Act.
The second petition concerned C.C. No. 2311/2019, arising from Crime No. 73/2017 registered at Mangaluru East Police Station. In that case, Kurian was accused No. 1 and faced allegations under Sections 4 and 5 of the Act.
Although the cases originated at different police stations, the Court heard them together because both turned on the same legal question concerning the authority of the officers involved.
Central legal issue: appointment of Special Police Officers
Kurian argued that the raids and investigations did not comply with Sections 13 and 15 of the ITP Act. Section 13 provides for the appointment of Special Police Officers to deal with offences under the statute, while Section 15 regulates searches conducted in connection with such offences.
The petitionerβs counsel contended that:
No government notification was produced showing that the investigating officers had been appointed as Special Police Officers under the Act.
The officers therefore lacked the specific statutory authority needed to conduct raids and investigate the alleged offences.
No search warrant had been obtained before the raids.
Even where a warrantless search may be permitted, it must be carried out by an authorized Special Police Officer and the legal safeguards must be followed.
The State submitted that the officer who conducted the raid held the rank of Inspector of Police. However, it did not rely on or produce a notification showing that the officer had been specially appointed by the State to deal with offences under the ITP Act.
Why the Court quashed the proceedings
The Court found that the State had not established that the investigating officer was an authorized Special Police Officer. Justice Sandesh noted that earlier Karnataka High Court decisions had treated compliance with the relevant ITP Act provisions as mandatory.
The Court relied on the principle from previous rulings that, where there is no notification demonstrating that an investigating officer qualifies as a Special Police Officer under the Act, the investigation cannot be sustained in law.
The decision underscores that an officerβs general police rank alone does not establish the special authorization required for investigations under a statute with its own procedural framework. For ITP Act cases, the State must be able to show the officerβs appointment under the Act when that authority is challenged.
The ruling
The High Court allowed both petitions and quashed the proceedings against Kurian in:
C.C. No. 3260/2017, arising from Barke Police Station Crime No. 8/2017; and
C.C. No. 2311/2019, arising from Mangaluru East Police Station Crime No. 73/2017.
Broader significance
The ruling reinforces the importance of procedural compliance in criminal investigations under special laws. It confirms that, in ITP Act prosecutions, the State must demonstrate that the officer conducting the raid or investigation was validly appointed under the statutory scheme.
Where that foundational requirement is not met, proceedings may be vulnerable to being quashed. The decision is based on the procedural validity of the investigations and does not determine the underlying factual allegations on their merits.
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