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  • Supreme Court Clarifies Applicability of Section 42 NDPS Act

    Supreme Court Clarifies Applicability of Section 42 NDPS Act

    Aadrikaa Legal Services (ALS)- Law I Litigation I Arbitration

    Date: 07.09.2026

    Supreme Court Clarifies Applicability of Section 42 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, in a landmark judgment, acquitted Boota Singh and others who were previously convicted under Section 15 of the Narcotic Drugs and Psychotropic Substances Act, 1985 (NDPS Act) for possession and sale of poppy straw. This article provides a detailed analysis of the case, the legal issues involved, and the implications of the Supreme Court’s decision.

    Background of the Case

    On January 28, 2002, police officials received secret information that the accused were selling poppy straw from a jeep on a public road. Acting on this tip, the police conducted a raid and apprehended Boota Singh, Gurdeep Singh, and Gurmohinder Singh at the scene, while a fourth accused, Major Singh, managed to escape. The police recovered two bags containing a total of 75 kg of poppy straw from the jeep. The accused were charged under Section 15 of the NDPS Act.

    Trial and Conviction

    During the trial, the prosecution presented four witnesses and documentary evidence. The trial court acquitted Major Singh but convicted the other three accused, sentencing them to 10 years of rigorous imprisonment and a fine of Rs. 1,00,000 each. The court held that since the recovery was made from a public place (the jeep on a public road), Section 43 of the NDPS Act applied, not Section 42, which deals with search and seizure in private places.

    Appeal and Legal Issues

    The convicted accused appealed to the High Court, which upheld the trial court’s decision. The main legal issue revolved around whether the search and seizure should have complied with Section 42 (which requires recording secret information in writing and informing a superior officer) or Section 43 (which applies to public places and does not require such formalities).

    The appellants argued that:

    1. The vehicle was a private jeep, not a public conveyance.
    2. The police did not record the secret information in writing or obtain search warrants.
    3. Section 42 should apply, and its non-compliance entitled them to acquittal, as established in previous Supreme Court rulings.

    Supreme Court’s Analysis and Judgment

    The Supreme Court examined the facts and relevant legal precedents, including the Constitution Bench decision in Karnail Singh v. State of Haryana and State of Rajasthan v. Jagraj Singh alias Hansa. The Court noted:

    • The jeep was a private vehicle, not a public transport vehicle.
    • Section 43 applies to public places and public conveyances, but a private vehicle does not fall under this definition, even if parked on a public road.
    • Total non-compliance with Section 42 is impermissible. The police failed to record the secret information in writing or inform their superior, as required by Section 42.

    The Court concluded that the lower courts erred in applying Section 43 instead of Section 42. Since there was total non-compliance with Section 42, the conviction could not be sustained.

    Outcome and Implications

    The Supreme Court allowed the appeal, set aside the convictions, and ordered the immediate release of the appellants unless required in connection with any other offence. This judgment reinforces the importance of strict compliance with procedural safeguards under the NDPS Act, especially regarding search and seizure based on secret information.

    Key Takeaways

    1. Distinction Between Section 42 and Section 43: Section 42 applies to private places and vehicles, requiring written recording of information and communication to a superior officer. Section 43 applies to public places and public conveyances.
    2. Procedural Safeguards: Non-compliance with Section 42 is fatal to the prosecution’s case. Delayed compliance may be excused with satisfactory explanation, but total non-compliance is not permissible.
    3. Impact on Future Cases: The judgment sets a precedent for strict adherence to procedural requirements in NDPS cases, ensuring protection against arbitrary search and seizure.

    This case serves as a reminder that procedural lapses by law enforcement can lead to acquittal, even in serious offences under the NDPS Act.

    Connected Matter

    Kerala High Court Clarifies Mandatory Compliance with Section 42 NDPS Act for Searches of Private Vehicles at Night: Bail Granted for Procedural Lapses in Narcotics

    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.

    Source: Supreme Court

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    Ravi Shekhar Jha – Advocate, Bar Council of Delhi

  • Judicial Scrutiny of Confiscation and Penalty Orders on Restricted Second-Hand Imports

    Judicial Scrutiny of Confiscation and Penalty Orders on Restricted Second-Hand Imports

    Aadrikaa Legal Services (ALS)- Law I Litigation I Arbitration

    Date: 07.09.2026

    Judicial Scrutiny of Confiscation and Penalty Orders on Restricted Second-Hand Imports

    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 recent decision by the Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Bangalore, in the case of M/s. Ascent Circuits Pvt. Ltd. versus the Commissioner of Customs, highlights critical aspects of Indian customs law, particularly regarding the import of second-hand goods and the exercise of discretion in confiscation and penalty proceedings. This article provides a detailed overview and analysis of the case, its legal context, and its broader implications for importers and regulatory authorities.

    Case Background

    M/s. Ascent Circuits Pvt. Ltd. imported a “Posalux Machine DLR Measuring Unit.” Upon examination, customs authorities determined the goods were second-hand and classified as restricted under the Foreign Trade Policy (FTP). The original adjudicating authority ordered the goods to be released upon payment of a redemption fine of Rs. 30,000 under Section 125 of the Customs Act, 1962, and imposed a penalty of Rs. 10,000 under Section 112(a) of the Act.

    Both the importer and the Revenue appealed. The Commissioner (Appeals) dismissed the importer’s appeal, allowed the Revenue’s appeal, ordered absolute confiscation (no redemption), and enhanced the penalty to Rs. 1,00,000 under Section 114AA.

    Key Legal Issues

    1. Classification and Restriction of Goods

    • The core issue was whether the imported machine was a second-hand good and thus restricted under the FTP.
    • The examination report and a Chartered Engineer’s certificate confirmed the goods were second-hand, aged over six months, with a residual life of over six years.
    • As per FTP 2015-2020, import of second-hand goods (other than capital goods) is restricted and requires authorization.

    2. Confiscation and Redemption Fine

    • Section 125 of the Customs Act allows authorities discretion to offer redemption of confiscated goods upon payment of a fine, except in cases where absolute confiscation is warranted.
    • The Tribunal emphasized that this discretion must be exercised judiciously, with clear reasoning, and not as a mere formality.
    • The Commissioner (Appeals) relied on Supreme Court precedent (Union of India vs. Raj Grow Impex LLP) to justify absolute confiscation, but the Tribunal found the facts distinguishable and the reasoning insufficient for denying redemption.

    3. Penalty Provisions and Enhancement

    • The original penalty was imposed under Section 112(a), but the Commissioner (Appeals) enhanced it under Section 114AA, which deals with fraudulent documents.
    • The Tribunal held that these sections address different types of violations and that the enhancement was not justified in this context.

    Tribunal’s Findings and Decision

    • The Tribunal found that the goods were indeed second-hand and restricted, but not absolutely prohibited.
    • There was no evidence of fraud or mala fide intent by the importer.
    • The original authority’s decision to allow redemption on payment of fine was appropriate.
    • The enhancement of penalty and order of absolute confiscation by the Commissioner (Appeals) were set aside.
    • The appeal was allowed, restoring the original order: goods could be redeemed on payment of fine, and the lower penalty was reinstated.

    Legal and Practical Implications

    1. Discretion in Confiscation: Authorities must provide clear, reasoned justification when exercising discretion, especially when opting for absolute confiscation over redemption.
    2. Penalty Assessment: Penalties must be proportionate and based on the specific nature of the violation; enhancement requires a solid legal basis.
    3. Importer Responsibilities: Importers must ensure compliance with FTP and maintain documentation to establish the nature and condition of imported goods.
    4. Precedent Value: The case clarifies the application of Supreme Court judgments and the limits of administrative discretion in customs matters.

    Conclusion

    The Ascent Circuits Pvt. Ltd. case underscores the importance of reasoned decision-making in customs adjudication and the need for proportionality in penalties. It serves as a valuable reference for importers, legal practitioners, and customs officials navigating the complexities of restricted goods under Indian law.

    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.

    Source: CESTAT Bangalore

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    Ravi Shekhar Jha – Advocate, Bar Council of Delhi

  • Supreme Court Sets Zero Tolerance for AI-Generated Fake Legal Citations

    Supreme Court Sets Zero Tolerance for AI-Generated Fake Legal Citations

    Aadrikaa Legal Services (ALS)- Law I Litigation I Arbitration

    Date: 07.09.2026

    Supreme Court Sets Zero Tolerance for AI-Generated Fake Legal Citations

    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 recently delivered a landmark judgment in the case of Vijay Ghanshyam Gadiya vs. Union of India & Anr., addressing the critical issue of artificial intelligence (AI)-generated fake legal citations in judicial proceedings. This article explores the background, key findings, and broader implications of the judgment for the legal community and the use of AI in courts.

    Background of the Case

    • Case Origin: The appellant, Vijay Ghanshyam Gadiya, was penalized by the Additional Commissioner of Customs, Surat, for mis-declaring a consignment of natural diamonds as lab-grown diamonds to evade higher tariffs. The penalty imposed was Rs. 425,27,99,100 under Section 114 of the Customs Act, 1962.
    • Legal Journey: Gadiya’s challenge to the penalty was dismissed by the High Court of Gujarat. The matter was then appealed to the Supreme Court.

    Discovery of AI-Generated Fake Citations

    • Appellant’s Contention: During the Supreme Court proceedings, it was argued that several judgments and articles cited by the customs authority in their original order were generated using AI and were either non-existent or had fake citations.
    • Supreme Court’s Verification: The Court independently verified these references and found that:
      • Some cited case laws did not exist or had fabricated citations.
      • Some existing cases were misrepresented, with AI “hallucinating” legal principles not actually present in those judgments.

    Supreme Court’s Observations and Ruling

    Zero Tolerance for Fake AI-Generated Precedents

    • The Court emphasized a zero-tolerance policy for producing, citing, or using AI-generated precedents without proper verification.
    • It declared that:
      1. Advocates citing such unverified AI-generated judgments commit misconduct.
      2. Judges relying on fake or hallucinated AI-generated material commit a serious lapse.
      3. Any decision influenced by such material is invalid and must be set aside, even if the fake material had only an indirect impact.

    Integrity in Judicial Decision-Making

    • The Court stressed the necessity of maintaining the sanctity and integrity of the adjudication process.
    • It clarified that while AI can be a valuable assistive tool, it must never replace human adjudication. AI should serve as “training wheels,” not as the “pilot” in judicial decision-making.

    Outcome of the Case

    • The Supreme Court set aside both the High Court’s order and the original penalty order.
    • The case was remanded for fresh adjudication by a different officer of the same rank.
    • The Court left it to the appointing authority to consider disciplinary action against the author of the flawed order.

    Broader Implications for the Legal System

    Responsible Use of AI in Courts

    • The judgment acknowledges the growing role of AI in legal research and court processes, referencing the Supreme Court’s draft Regulations for Use of Artificial Intelligence in Courts (2026).
    • However, it draws a clear line: AI-generated content must be rigorously verified before being used in legal arguments or judgments.

    Safeguarding Legal Integrity

    • The ruling serves as a warning to both the Bar and the Bench against the uncritical adoption of AI-generated legal materials.
    • It reinforces the principle that the legitimacy of judicial decisions depends on the authenticity and accuracy of the sources relied upon.

    Conclusion

    The Vijay Ghanshyam Gadiya judgment is a pivotal moment in the intersection of law and technology in India. It sets a strong precedent for the responsible use of AI in the legal system, ensuring that technological advancements do not compromise the integrity of judicial decision-making. Legal professionals and courts must exercise due diligence and uphold the highest standards of verification when engaging with AI-generated content.

    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.

    Source: Supreme Court

    Disclaimer

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    Tel: +91-11-4999 2707

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    Ravi Shekhar Jha – Advocate, Bar Council of Delhi

  • Kerala High Court Clarifies Mandatory Compliance with Section 42 NDPS Act for Searches of Private Vehicles at Night: Bail Granted for Procedural Lapses in Narcotics

    Kerala High Court Clarifies Mandatory Compliance with Section 42 NDPS Act for Searches of Private Vehicles at Night: Bail Granted for Procedural Lapses in Narcotics

    Aadrikaa Legal Services (ALS)- Law I Litigation I Arbitration

    Date: 05.09.2026

    Kerala High Court Clarifies Mandatory Compliance with Section 42 NDPS Act for Searches of Private Vehicles at Night: Bail Granted for Procedural Lapses in Narcotics

    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 .  

    A recent order by the Kerala High Court, delivered by Honourable Dr. Justice Kauser Edappagath on June 22, 2026, has significant implications for bail applications under the Narcotic Drugs and Psychotropic Substances Act, 1985 (NDPS Act). The order addresses the procedural requirements for search and seizure in narcotics cases, especially when conducted in private vehicles at public places between sunset and sunrise.

    Background of the Case

    The order pertains to two bail applications:

    1. Bail Appl. No. 2849 of 2026: Filed by Muhammed Sahal, accused in Crime No. 60/2025 of Malappuram Excise Range Office.
    2. Bail Appl. No. 2650 of 2026: Filed by Akshay Saju and Revins Raj, accused in Crime No. 111/2026 of Peechi Police Station, Thrissur.

    All applicants were charged under Section 22(c) of the NDPS Act for alleged possession of narcotic drugs in commercial quantities and had been in judicial custody for several months.

    Core Legal Issue

    The central question was whether the search and seizure of narcotics from private vehicles, conducted between sunset and sunrise based on prior information, complied with the mandatory procedural safeguards under Section 42 of the NDPS Act. The applicants argued that the authorities failed to obtain a warrant or properly record and forward the grounds of belief as required by law, thus vitiating the search and entitling them to bail.

    Legal Provisions Discussed

    Section 42 NDPS Act

    • Governs search, seizure, and arrest without warrant in buildings, conveyances, or enclosed places based on prior information.
    • Requires the officer to record information in writing and, if the search is between sunset and sunrise, to record and forward the grounds of belief to a superior within 72 hours.

    Section 43 NDPS Act

    • Applies to search and seizure in public places or in transit.
    • Does not require the same procedural safeguards as Section 42 for searches in public places.

    Judicial Reasoning

    • The Court clarified that private vehicles, even when located in public places, are considered private places for the purpose of Section 42.
    • Supreme Court precedents (e.g., Boota Singh v. State of Haryana, Jagraj Singh v. State of Rajasthan) were cited, affirming that compliance with Section 42 is mandatory for searches of private vehicles in public places, especially between sunset and sunrise.
    • In both cases, the officers failed to provide adequate grounds of belief justifying the absence of a warrant, as required by the proviso to Section 42(1).
    • The documents labeled as “grounds of belief” did not contain the statutory satisfaction that obtaining a warrant would have led to concealment of evidence or escape of offenders.

    Outcome and Bail Conditions

    Given the total non-compliance with Section 42, the Court granted bail to the applicants, subject to strict conditions:

    1. Execution of a bond for Rs. 1,00,000 with two solvent sureties.
    2. Full cooperation with the investigation.
    3. Mandatory weekly appearance before the investigating officer.
    4. No commission of similar offences while on bail.
    5. No contact with prosecution witnesses or tampering with evidence.
    6. No travel outside Kerala without court permission.
    7. Any application for modification or cancellation of bail conditions to be filed in the jurisdictional court.

    Significance of the Order

    • Reinforces procedural safeguards: The order underscores the importance of strict compliance with Section 42 of the NDPS Act, especially in cases involving private vehicles.
    • Sets precedent for future cases: The decision provides clear guidance for law enforcement and the judiciary on the distinction between public and private places under the NDPS Act.
    • Protects individual rights: By insisting on adherence to statutory procedures, the Court ensures that the rights of the accused are protected against unlawful search and seizure.

    Conclusion

    This Kerala High Court order is a landmark in the interpretation of procedural requirements under the NDPS Act. It highlights the judiciary’s role in upholding the rule of law and ensuring that investigative agencies strictly follow legal mandates, especially in serious offences involving narcotics.

    Connected Matter

    Supreme Court Clarifies Applicability of Section 42 NDPS Act

    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.

    Source: Kerala High Court

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    Ravi Shekhar Jha – Advocate, Bar Council of Delhi

  • Delhi High Court Sets Aside Pre-CIRP Demand Notices: Application of Clean Slate Theory Post-IBC Resolution Plan Approval

    Delhi High Court Sets Aside Pre-CIRP Demand Notices: Application of Clean Slate Theory Post-IBC Resolution Plan Approval

    Aadrikaa Legal Services (ALS)- Law I Litigation I Arbitration

    Date: 05.09.2026

    Delhi High Court Sets Aside Pre-CIRP Demand Notices: Application of Clean Slate Theory Post-IBC Resolution Plan Approval

    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 .  

    A recent decision by the Delhi High Court in the case of GARG INOX LTD & ANR. vs. Union of India & Ors. has reaffirmed the legal principle that once a resolution plan under the Insolvency and Bankruptcy Code, 2016 (IBC) is approved, all prior claims not included in the plan are extinguished. This article provides a detailed analysis of the case, its background, the legal arguments, and the implications for stakeholders in insolvency proceedings.

    Background of the Case

    GARG INOX LTD (the petitioner company) underwent a Corporate Insolvency Resolution Process (CIRP) initiated by the National Company Law Tribunal (NCLT) on 25 July 2017. The successful resolution applicant’s plan was approved by the NCLT on 4 December 2018, as per Section 31 of the IBC.

    Despite the approval, various government authoritiesβ€”including the Income Tax Department, Regional Provident Fund Commissioner, Commissioner of Customs, DGGSTI Department, and Gram Panchayat Karegaonβ€”issued demand notices for dues that arose before the CIRP commencement date. The petitioners challenged these notices, arguing that such claims were settled or extinguished by the approved resolution plan.

    Key Legal Issues

    1. Whether statutory and other claims arising before the CIRP date can be enforced after approval of the resolution plan.
    2. Whether the successful resolution applicant can be held liable for such pre-CIRP claims not included in the resolution plan.

    Court’s Analysis and Findings

    Reliance on Supreme Court Precedents

    The petitioners relied on landmark Supreme Court judgments:

    • Ghanshyam Mishra & Sons Pvt. Ltd. vs. Edelweiss Asset Reconstruction Co. Ltd.: The Supreme Court held that once a resolution plan is approved, all claims not included in the plan are extinguished and cannot be enforced later.
    • Essar Steel India Ltd. Committee of Creditors vs. Satish Kumar Gupta: The Court emphasized that a successful resolution applicant must not face undecided claims after the resolution plan is approved, ensuring certainty and a “fresh slate” for the new management.

    Application of the “Clean Slate Theory”

    The Delhi High Court reiterated the “Clean Slate Theory,” stating that the resolution applicant should not be burdened with past liabilities not accounted for in the resolution plan. This approach ensures finality and encourages resolution applicants to revive distressed companies without fear of unforeseen liabilities.

    Extinguishment of Pre-CIRP Claims

    The Court found that all demand notices issued for periods prior to the CIRP initiation date (25 July 2017) were invalid, as those claims were not part of the approved resolution plan. The Court set aside these notices, reinforcing that such claims cannot be enforced post-approval.

    Implications of the Judgment

    1. Certainty for Resolution Applicants: Prospective applicants can confidently take over distressed companies, knowing that only liabilities included in the resolution plan will bind them.
    2. Finality in Insolvency Proceedings: The judgment discourages endless litigation and claims, promoting closure and efficient resolution.
    3. Binding Effect on All Stakeholders: The decision is binding on all creditors, including government authorities, ensuring uniformity in the treatment of claims.

    Conclusion

    The Delhi High Court’s judgment in GARG INOX LTD & ANR. vs. Union of India & Ors. is a significant reaffirmation of the principles underlying the IBC. It upholds the sanctity of the resolution plan and provides much-needed clarity and confidence to resolution applicants and stakeholders in the insolvency process. This decision is expected to further streamline insolvency proceedings and promote the revival of distressed assets in India.

    Connected Matter

    Delhi High Court- Customs Department Cannot Enforce Pre-Insolvency Claims Not Submitted During CIRP

    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.

    Source: Delhi High Court

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    Ravi Shekhar Jha – Advocate, Bar Council of Delhi

  • Delhi High Court Safeguards PHENSEDYL Mark from Infringement and Passing Off

    Delhi High Court Safeguards PHENSEDYL Mark from Infringement and Passing Off

    Aadrikaa Legal Services (ALS)- Law I Litigation I Arbitration

    Date: 05.09.2026

    Delhi High Court Safeguards PHENSEDYL Mark from Infringement and Passing Off

    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 .  

    A recent judgment by the Delhi High Court has set a significant precedent in the field of pharmaceutical trademark protection. The case, Opella Healthcare Group vs. Pureca Laboratories Pvt Ltd, revolved around the alleged infringement and passing off of the well-known trademark “PHENSEDYL” by the defendant’s use of the mark “PHENSERYL”. This article provides a detailed overview of the case, the court’s findings, and its broader implications for intellectual property rights in the pharmaceutical sector.

    Background of the Case

    • Plaintiff: Opella Healthcare Group, part of the global Sanofi Group, a major player in pharmaceuticals.
    • Defendant: Pureca Laboratories Pvt Ltd.
    • Dispute: The plaintiff alleged that the defendant’s use of the mark “PHENSERYL” and similar packaging was deceptively similar to their registered trademark “PHENSEDYL”, leading to trademark infringement and passing off.

    Key Facts

    1. History of the PHENSEDYL Mark:
      • Adopted in 1954 for pharmaceutical products treating symptoms like running nose, sneezing, and throat irritation.
      • Registered in India since 21 July 1954 in Class 05 (pharmaceutical preparations for human and veterinary use).
      • Widely marketed in India since 1995, with distinctive blue and pink packaging.
    2. Defendant’s Actions:
      • Registered the mark “PHENSERYL” in Class 05, claiming use since December 2016.
      • Adopted similar trade dress and packaging, leading to confusion among consumers.
    3. Legal Proceedings:
      • Plaintiff filed for a permanent injunction and rectification of the defendant’s trademark and copyright registrations.
      • The court had previously cancelled the defendant’s registrations, finding them deceptively similar to the plaintiff’s mark.

    Court’s Analysis and Findings

    • Ex Parte Proceedings: The defendant failed to appear in court, and the matter proceeded ex parte.
    • Prior Use and Goodwill: The court recognized Opella Healthcare Group as the prior adopter and continuous user of the “PHENSEDYL” mark, with substantial goodwill and reputation in India.
    • Deceptive Similarity:
      • The marks “PHENSEDYL” and “PHENSERYL” were found to be visually and phonetically similar.
      • The packaging and trade dress used by the defendant closely resembled that of the plaintiff, increasing the likelihood of consumer confusion.
    • Public Interest in Pharmaceuticals:
      • The court emphasized that confusion in pharmaceutical products can be life-threatening, not just inconvenient, citing Supreme Court precedent.
      • A higher threshold for proving confusing similarity applies in the pharmaceutical sector.
    • Summary Judgment:
      • The court granted summary judgment in favor of the plaintiff, noting that the defendant had no real prospect of defending the claims.
      • The suit was decreed in favor of Opella Healthcare Group, granting a permanent injunction against the defendant.

    Implications of the Judgment

    1. Strengthening Trademark Protection:
      • The judgment reinforces the importance of protecting established pharmaceutical trademarks against deceptively similar marks.
    2. Consumer Safety:
      • By preventing confusion between medicinal products, the court prioritized public health and safety.
    3. Judicial Efficiency:
      • The use of summary judgment procedures in commercial disputes ensures timely resolution, especially when the defendant lacks a credible defense.

    Conclusion

    The Delhi High Court’s decision in Opella Healthcare Group vs. Pureca Laboratories Pvt Ltd is a landmark in pharmaceutical trademark law. It underscores the judiciary’s commitment to protecting intellectual property, ensuring consumer safety, and promoting fair competition in the pharmaceutical industry.

    Connected Matter

    Delhi High Court Invalidates Trademark Assignment, Affirms Corporate Ownership of ‘Su-Kam’ Brand

    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.

    Source: Delhi High Court

    Disclaimer

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    Ravi Shekhar Jha – Advocate, Bar Council of Delhi

  • CESTAT Mumbai confirming that SAD exemption claims are valid when statutory taxes are paid on domestic sales

    CESTAT Mumbai confirming that SAD exemption claims are valid when statutory taxes are paid on domestic sales

    Aadrikaa Legal Services (ALS)- Law I Litigation I Arbitration

    Date: 04.09.2026

    CESTAT Mumbai confirming that SAD exemption claims are valid when statutory taxes are paid on domestic sales

    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 .  

    A recent decision by the Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Mumbai, has significant implications for manufacturers importing goods through Free Trade Warehousing Zones (FTWZ) and claiming Special Additional Duty (SAD) exemptions. The case involved M/s Emerson Process Management (India) Pvt. Ltd. and its Managing Director, Amit Paithankar, challenging customs duty demands and penalties imposed by the Principal Commissioner of Customs, JNCH, Nhava Sheva.

    Background of the Case

    Emerson Process Management (India) Pvt. Ltd. manufactures process management equipment and imports raw materials via FTWZs. These goods are processed at their Navi Mumbai factory and sold domestically, with applicable VAT/sales tax paid on final products. The company availed SAD exemption under Notification No. 45/2005-Customs, based on the undertaking that VAT/CST would be paid on domestic sales.

    However, the Directorate General of Central Excise Intelligence (DGCEI) alleged that Emerson wrongly availed SAD exemption on goods used in manufacturing, leading to a Show Cause Notice demanding over Rs. 1.79 crore in SAD, interest, and penalties. The Principal Commissioner confirmed these demands, prompting appeals from both the company and the Revenue (the latter seeking higher penalties).

    Key Legal Issues

    The central question was whether SAD exemption under Notification No. 45/2005-Customs applies to goods cleared from FTWZ to Domestic Tariff Area (DTA) units on a stock transfer basis, especially when VAT/sales tax is eventually paid on the final product.

    Arguments Presented

    For the Appellants

    1. Precedent and Industry Practice: The issue was already settled in favor of appellants in several tribunal and Supreme Court decisions, confirming eligibility for SAD exemption when VAT is paid on final sales.
    2. Full Disclosure: Emerson argued there was no suppression of facts, as all clearances followed prescribed procedures and were supervised by customs officers.
    3. No Malafide Intent: The company relied on approvals from the Development Commissioner of SEZ/FTWZ and industry-wide interpretations, negating any intent to evade duty.
    4. Limitation Period: The demand was time-barred, as the Show Cause Notice covered a period beyond the normal limitation period.

    For the Revenue

    1. Circular Interpretation: The Revenue cited a Ministry of Finance circular clarifying that SAD exemption is not available for stock transfers from SEZ/FTWZ to DTA for self-consumption.
    2. Mandatory Penalty: The Revenue sought imposition of a penalty equal to the duty amount under Section 114A of the Customs Act.

    Tribunal’s Findings

    1. Precedent Supports Exemption: The Tribunal cited multiple decisions, including CRI Ltd. v. Commissioner of Customs and Serum Institute of India, confirming that SAD exemption applies when VAT is paid on final sales, regardless of whether the initial transfer is a sale or stock transfer.
    2. No Suppression or Malafide: The Tribunal found no evidence of suppression or malafide intent, as the company acted in line with industry practice and customs approvals.
    3. Limitation Period Applies: Since the demand was raised beyond the normal limitation period and there was no suppression, the extended period could not be invoked.
    4. Revenue’s Appeal Dismissed: The Tribunal rejected the Revenue’s demand for a higher penalty, as the underlying duty demand itself was unsustainable.

    Outcome

    • The Tribunal set aside the duty demand, confiscation order, and penalties against Emerson and its Managing Director.
    • The Revenue’s appeal for a higher penalty was dismissed.
    • The decision reinforces the principle that SAD exemption is available when VAT/sales tax is paid on final sales, even if goods are initially transferred on a stock basis from FTWZ/SEZ to DTA units.

    Implications for Industry

    This ruling provides clarity and relief for manufacturers using FTWZ/SEZ facilities, confirming that SAD exemption claims are valid when statutory taxes are paid on domestic sales. It also underscores the importance of following prescribed procedures and maintaining transparent documentation to defend against future disputes.

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    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.

    Source: CESTAT Mumbai

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  • Interim Release of Seized Vehicles Under NDPS Act

    Interim Release of Seized Vehicles Under NDPS Act

    Aadrikaa Legal Services (ALS)- Law I Litigation I Arbitration

    Date: 03.09.2026

    Interim Release of Seized Vehicles Under 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 recently delivered a significant judgment in the case of Bishwajit Dey v. State of Assam, addressing the interim release of vehicles seized under the Narcotic Drugs and Psychotropic Substances Act, 1985 (NDPS Act). This article provides a detailed overview of the case, the legal arguments, and the Court’s reasoning, offering clarity on a complex area of criminal law.

    Background of the Case

    • Incident: On April 10, 2023, a truck owned by Bishwajit Dey was stopped at a police checkpoint in Assam. Police discovered 24.8 grams of heroin concealed in the vehicle. The main accused, Md. Dimpul, was arrested at the scene.
    • Appellant’s Position: Bishwajit Dey, the truck owner, claimed neither he nor his driver was aware of the contraband. The driver and helper were cited as witnesses, not accused.
    • Legal Proceedings: The vehicle was seized and left exposed at the police station, leading Dey to seek its interim release under Sections 451 and 457 of the Code of Criminal Procedure (CrPC).

    Legal Arguments

    For the Appellant

    1. No Knowledge or Involvement: The owner and driver were not implicated in the crime.
    2. Vehicle Deterioration: The truck, being the owner’s sole source of income, was deteriorating in police custody.
    3. Precedents: Cited Supreme Court and High Court judgments supporting interim release of vehicles to bona fide owners, subject to conditions.

    For the State

    1. NDPS Act as a Special Law: The State argued that the NDPS Act is a complete code, and does not contemplate interim release of seized vehicles during trial.
    2. Risk of Reuse: Releasing the vehicle could enable further illegal activities.
    3. Material Evidence: The vehicle is crucial evidence for the prosecution.

    Key Legal Provisions Discussed

    • NDPS Act Sections 36C, 51, 52A, 60, 63: Address the procedure for seizure, storage, and confiscation of vehicles used in drug trafficking.
    • CrPC Sections 451, 457: Allow courts to order interim custody or disposal of property pending trial.

    Supreme Court’s Reasoning

    No Absolute Bar on Interim Release

    • The Court found no specific prohibition in the NDPS Act against interim release of seized vehicles.
    • Section 51 of the NDPS Act allows application of CrPC provisions unless inconsistent with the Act.

    Case-by-Case Discretion

    • The Court outlined four scenarios for vehicle seizure:
      1. Owner is the accused.
      2. Owner’s agent (e.g., driver) is the accused.
      3. Vehicle is stolen and used without owner’s knowledge.
      4. Contraband is found with a third-party occupant, with no allegation against the owner.
    • In the first two scenarios, interim release is generally not favored. In the latter two, especially where the owner is not accused, interim release should normally be granted, subject to safeguards.

    Practical Considerations

    • Keeping vehicles in police custody leads to deterioration and loss of value.
    • Interim release benefits the owner (restoring livelihood), the financier (loan repayment), and society (vehicle utility).

    Safeguards for Interim Release

    • Detailed video and photographic documentation of the vehicle.
    • Undertaking by the owner not to sell or transfer the vehicle during trial.
    • Bond to ensure the vehicle’s production or payment of its value if confiscation is ordered.

    Final Directions

    The Supreme Court allowed the appeal, directing the trial court to release the vehicle to the owner on strict conditions, including:

    • Preparation of video and photographic inventory.
    • Authentication by the investigating officer, owner, and accused.
    • Prohibition on sale or transfer until trial concludes.
    • Undertaking to produce the vehicle or pay its value if required.

    Implications of the Judgment

    • Clarity for Lower Courts: The judgment provides a clear framework for handling interim release applications in NDPS cases.
    • Protection for Innocent Owners: Owners not implicated in the crime are protected from undue hardship.
    • Balance of Interests: The decision balances the need to preserve evidence with the rights of property owners.

    This landmark ruling ensures that justice is served without causing unnecessary harm to innocent vehicle owners, while maintaining the integrity of criminal investigations under the NDPS Act.

    Connected Matter

    High Court of Gujarat on Conditional Release of Seized Vehicle Under NDPS Act

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    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.

    Source: Supreme Court

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  • Delhi High Court Mandates Due Process and Notice Before Removal of Registered Trademark for Non-Renewal

    Delhi High Court Mandates Due Process and Notice Before Removal of Registered Trademark for Non-Renewal

    Aadrikaa Legal Services (ALS)- Law I Litigation I Arbitration

    Date: 03.09.2026

    Delhi High Court Mandates Due Process and Notice Before Removal of Registered Trademark for Non-Renewal

    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 .  

    This article explores a significant decision by the Delhi High Court in the matter of Gopal Ji Gupta vs. Union of India, which clarifies the legal procedures and rights concerning the renewal and removal of registered trademarks in India. The judgment not only impacts trademark proprietors but also sets a precedent for the protection of intellectual property rights.

    Background of the Case

    Gopal Ji Gupta, trading as M/s Kiran Textiles, applied for the registration of the trademark “BINACA” under Class 25 on June 15, 1987. The registration process was protracted, with the mark being published in 1995 and finally registered in 1998. The initial validity of the trademark was seven years, making it due for renewal in 1994. However, since the registration was only granted in 1998, the petitioner filed for renewal in 2001, following the then-applicable rules.

    In 2015, upon checking the status of his trademark online, the petitioner discovered that the renewal was overdue. He promptly filed a renewal application, which was rejected by the Registrar of Trademarks as time-barred. The petitioner argued that he had not received the mandatory notice (Form O-3) regarding the expiry and removal of his trademark, as required by law.

    Legal Issues and Arguments

    Petitioner’s Stand

    1. Lack of Mandatory Notice: The petitioner contended that under Section 25(3) of the Trademarks Act, 1999 and Rule 64(1) of the Trademark Rules, 2002, the Registrar must issue a notice (Form O-3) before removing a trademark from the register due to non-renewal.
    2. Right to Renewal: Since no such notice was received, the rejection of his renewal application was argued to be unlawful.
    3. Precedent Cited: The petitioner relied on the Malhotra Book Depot vs. Union of India case, where the court held that removal of a trademark without issuing the prescribed notice is illegal.

    Respondent’s Stand

    1. Delay and Laches: The respondents argued that the renewal application was filed late and that the petition itself was delayed.
    2. No Requirement for Notice: They claimed that since the renewal was not filed within the prescribed period, no notice was necessary.
    3. Alternative Remedy: The respondents also challenged the maintainability of the petition, suggesting that the petitioner should have appealed to the Appellate Board.

    Court’s Analysis and Findings

    The Court addressed two main issues:

    1. Maintainability of the Petition: The Court accepted the petitioner’s argument that the Appellate Board was not fully constituted at the time, making the writ petition maintainable.
    2. Requirement of Notice Before Removal:
      • The Court emphasized that removal of a trademark from the register has significant civil consequences and cannot be done without following the mandatory procedure of issuing a notice in Form O-3.
      • Citing the Malhotra Book Depot case, the Court reiterated that mere expiration of registration does not automatically authorize removal; due process must be followed.
      • The Court also highlighted that intellectual property rights, like tangible property, cannot be taken away without due process of law.

    Judgment and Directions

    The Delhi High Court ruled in favor of the petitioner, holding that:

    • The Registrar of Trademarks cannot remove a trademark from the register without issuing the mandatory notice as per Section 25(3) and the relevant rules.
    • The petitioner’s application for renewal must be considered, subject to payment of late fees and fulfillment of other requirements.
    • Since no third party had applied for the same mark, the petitioner’s rights were further protected.

    Key Takeaways for Trademark Owners

    1. Mandatory Notice: Trademark proprietors must be given a formal notice before their mark is removed for non-renewal.
    2. Due Process: Removal of a trademark without following statutory procedures is illegal and can be challenged in court.
    3. Protection of Rights: Intellectual property rights are protected under the law, and due process must be observed before depriving a proprietor of such rights.
    4. Timely Action: While the law provides safeguards, proprietors should monitor their trademark status and act promptly to avoid complications.

    Conclusion

    The judgment in Gopal Ji Gupta vs. Union of India reinforces the importance of procedural fairness in trademark law. It ensures that trademark owners are not deprived of their rights without due notice and legal process, thereby strengthening the framework for intellectual property protection in India.

    Connected Matter

    Delhi High Court Orders Restoration of ‘BLUE CHIP’ Trademark to Mehta Cosmetics After Procedural Lapse by Registrar

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    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.

    Source: Delhi High Court

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  • Delhi High Court- Customs Department Cannot Enforce Pre-Insolvency Claims Not Submitted During CIRP

    Delhi High Court- Customs Department Cannot Enforce Pre-Insolvency Claims Not Submitted During CIRP

    Aadrikaa Legal Services (ALS)- Law I Litigation I Arbitration

    Date: 03.09.2026

    Delhi High Court- Customs Department Cannot Enforce Pre-Insolvency Claims Not Submitted During CIRP

    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 recently delivered a significant judgment in the case of Jaiprakash Associates Limited vs. The Office of the Commissioner of Customs Air Cargo Complex Import & Anr., addressing the interplay between customs liabilities and the Insolvency and Bankruptcy Code, 2016 (IBC). This article provides a detailed analysis of the case, its background, legal arguments, and the broader implications for insolvency proceedings and statutory dues in India.

    Background of the Case

    • Import Transaction: On 15 September 2023, Jaiprakash Associates Limited (JAL) imported Digital and Network Video Recorders, availing a concessional customs duty rate.
    • Customs Dispute: The Customs Department later alleged that the goods were not eligible for the concessional rate, raising a demand for differential duty, interest, and penalty.
    • Insolvency Proceedings: Meanwhile, insolvency proceedings against JAL commenced on 3 June 2024, with a public announcement inviting creditor claims. The Customs Department did not submit any claim during the Corporate Insolvency Resolution Process (CIRP).
    • Resolution Plan: The Committee of Creditors approved a Resolution Plan by Adani Enterprises Limited, which was subsequently approved by the National Company Law Tribunal (NCLT) on 17 March 2026. The plan explicitly extinguished all pre-CIRP claims not submitted during the process.
    • Customs Order: Despite being informed of the approved Resolution Plan, the Customs Authority passed an order on 2 June 2026, confirming the demand against JAL.

    Key Legal Issues

    1. Whether customs liabilities arising from pre-CIRP transactions can be enforced after approval of a Resolution Plan if the claim was not submitted during CIRP.
    2. Whether the Customs Department’s failure to submit a claim during CIRP extinguishes its right to recover dues post-approval of the Resolution Plan.

    Arguments Presented

    Petitioner (Jaiprakash Associates Limited)

    • The customs liability pertained to a period before the insolvency commencement date.
    • The Customs Department, as an operational creditor, failed to submit its claim during CIRP.
    • Section 31(1) of the IBC and the Supreme Court’s decision in Ghanashyam Mishra & Sons (P) Ltd. v. Edelweiss Asset Reconstruction Co. Ltd. establish that unfiled pre-CIRP claims are extinguished upon approval of the Resolution Plan.
    • The Resolution Plan, binding on all stakeholders including government authorities, specifically extinguished such claims.

    Respondents (Customs Department)

    • The Customs Act allows determination of customs duty, interest, and penalty, regardless of CIRP.
    • The customs liability was not shown to have been considered in the Resolution Plan.
    • The pendency of CIRP was only brought to their notice at the final hearing stage.
    • An appeal remedy exists under the Customs Act.

    Court’s Analysis and Findings

    • Wide Definition of “Claim”: The IBC defines “claim” broadly, covering all rights to payment, whether adjudicated or not. The customs liability, though not quantified before CIRP, was a claim under the IBC.
    • Public Announcement Mechanism: The IBC requires a public announcement for creditors to submit claims. The Customs Department’s failure to respond to this announcement meant its claim was not considered in the Resolution Plan.
    • Binding Nature of Resolution Plan: Section 31(1) of the IBC, especially after the 2019 amendment, makes the approved Resolution Plan binding on all creditors, including government authorities. The Supreme Court has clarified that unfiled claims are extinguished upon approval.
    • IBC Prevails Over Other Laws: Section 238 of the IBC gives it overriding effect in case of inconsistency with other laws, including the Customs Act.
    • No Exception for Statutory Dues: The Court rejected the argument that statutory dues enjoy a special status outside the IBC framework, citing recent Supreme Court jurisprudence.
    • No Recovery Post-Approval: The Customs Department could not enforce a pre-CIRP claim after the Resolution Plan’s approval, as it had not participated in the CIRP.

    Judgment and Impact

    • The High Court quashed the Customs Department’s order confirming the demand against JAL.
    • The judgment reinforces that all creditors, including government authorities, must submit their claims during CIRP or risk extinguishment upon approval of the Resolution Plan.
    • The decision upholds the IBC’s objective of providing a “clean slate” to successful resolution applicants and ensures finality in insolvency proceedings.

    Key Takeaways for Stakeholders

    1. Government Authorities as Creditors: Statutory authorities must actively participate in CIRP and submit claims within prescribed timelines.
    2. Resolution Applicants: Can rely on the finality of the Resolution Plan and are protected from undisclosed or unfiled pre-CIRP claims.
    3. Corporate Debtors: Are not liable for pre-CIRP claims not included in the Resolution Plan post-approval.
    4. Legal Certainty: The judgment provides clarity and certainty for all stakeholders in insolvency proceedings.

    Conclusion

    The Delhi High Court’s decision in the Jaiprakash Associates Limited case is a landmark in harmonizing the IBC with other statutory regimes. It underscores the importance of timely claim submission by all creditors and affirms the supremacy of the IBC in insolvency matters, ensuring that successful resolution applicants are not burdened with legacy liabilities outside the Resolution Plan.

    Connected Matter

    Delhi High Court Sets Aside Pre-CIRP Demand Notices: Application of Clean Slate Theory Post-IBC Resolution Plan Approval

    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.

    Source: Delhi High Court

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