( MONTHLY REPORT FOR DECEMBER , 2007

CHIEF ADVISER Pradeep K. Mittal B.Com., LL.B., FCS, pkm171@yahoo.com Advocate--9811044365 Central Council Member The Institute of Company Secretaries of India

Sh C M Bindal, -9414962454 FCS Company Secretary in Practice – JAIPUR CONTRIBUTION FOR – SEBI LAWS

E-mail : cmbindal@yahoo.com

Sh Himanshu Goyal – 9899566764 Chartered Accountants M/s Ved Jain & Associates CONTRIBUTION FOR – INCOME TAX E-mail: goyalhimanshu@hotmail.com

Sh. Rakesh Garg –9810216270 FCA

Practicing Chartered Accountant CONTRIBUTION FOR - SALES TAX & VAT

E-mail: sahaigarg@hotmail.com

Sh. Pradeep kumar Aggarwal - 9811300732 Practicing Chartered Accountant CONTRIBUTION FOR - Vedic Astrology

E-mail: peekay161@yahoo.com------------------------------------------------------------------------------------------ HONORARY ASSOCIATES

Dr. Sanjeev Kumar

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M.Com. LL.B., Ph.D, PGDPIRL, FICWA, FCS

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SEB/SECURITIES LAWS BY SHRI C.M.BINDAL - 9414962454 NOTIFICATIONS/CIRCULARS/REGULATIONS/RULES:

Parking of Funds in Short Term Deposits of Scheduled Commercial

Banks by Mutual Funds – Pending deployment. Circular No. SEBI/IMD/CIR No.8/107311/07, dated 26th October, 2007.

SEBI Board Meeting –Issues relating to registration of FIIs. Press Release No. 286/2007, dated 25th October, 2007. [on Offshore Derivative Instruments – Participatory Notes].

SEBI (Depositories and Participants) (Amendment) Regulations, 2007. Notification No. 11/LC/GN/2007/4485, dated 10th October, 2007.

SEBI Board approves new derivative products. Press Release No. 297/2007, Dated 14th November, 2007.

SEBI (Certification of Associated Persons in the Securities Markets) Regulations, 2007. Notification No. 11/LC/GN/2007/4567, dated 17th

October, 2007.

SEBI (Mutual Funds) (Second Amendment) Regulations, 2007. Notification No. 11/LC/GN/2007/4646, dated 31st October, 2007.

Guidelines on Corporate Governance for Central Public Sector Enterprises. PIB Press Release, dated 9th October, 2007.

LEGAL CASES: 1. MILAN MAHENDRA SECURITIES (P) LTD. VS. SEBI (2007) 76

SCL 365 SAT (MUM);

Shares were acquired by share broker, breach of regn. 7 of Takeover Code. Since the shares were transferred to the proprietary account of the appellant it has to be held that the appellant had acquired these shares within the meaning of the regulations. Plea that these shares were received by the appellant in the ordinary course of the business cannot be accepted because, had it been so, the shares would have been received by the appellant in its pool account which is maintained by a stock broker for the purpose of trading those shares on behalf of his clients. Appellant for all purposes had become a shareholder of the target company when the shares were transferred to its proprietary account. Contention that the violation was technical in nature is not sustainable. Further, may be the appellant has closed down its business as a stock broker, but that would have no relevance for determining whether it had violated regn. 7 when it acquired shares of the target company. Appellant was liable to penalty. [SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 1997, regn. 7].

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DOWELL LEASING & FINANCE LTD. VS. RADHESHYAM B. KHANDELWAL (2007) 79 SCL 451 (BOM):

Under s. 16 of the Arbitration Act of 1996, the decision referred is an `order’ and not `an award’. Decision of the arbitral Tribunal, holding that there was no provision for arbitration, was an order and not an award. An appeal under bye-law 274A would lie at the instance of a party dissatisfied with an award made under the bye-law 260. Challenge to the party was available under s. 37(2) of the 1996 Act. Once that be the case, the second arbitration as invoked was without the authority of law and as such the order dated 19th Oct.,2006 would have to be set aside. It will be open to the respondent, considering the power conferred under s. 37(2) to challenge that order by preferring an appeal. Appeal filed before the appellate authority of the stock exchange was not maintainable. [Arbitration and Conciliation Act, 1996, s. 37; Bombay Stock Exchange Bye-laws, Bye-law Nos. 260 & 274A].

INCOME TAX - SH.HIMANSHU GOYAL - 9899566764

Reassessment - Limitation – Applicability of proviso to s.147 vis-à-vis- s.149 – Reason to believe - An assessment could be reopened under s. 147 – Where, however an order of assessment had been made, there was an express bar to initiation of action after expiry of four years from the relevant assessment year except in the circumstances stated in the proviso to s. 147 – Notice under s. 148 has to be issued within four years except where the income chargeable to tax which has escaped assessment is likely to be rupees one lakh or more – Action under s. 147 having been initiated against the petitioner after expiry of of four years from the end of the relevant assessment year, same was barred by limitation – That apart, the assessing authority has purported to reopen the assessment upon change of opinion on the same facts which is not permissible- Further, revenue has taken yet another ground in its affidavit in opposition i.e. benefit of s. 80HHC could not be allowed unless sale proceeds were received in convertible foreign exchange . It was not the case of the Revenue at the time of reopening of assessment that the proceeds were not received in convertible foreign exchange. Revenue can not by way of affidavit improve upon reasons initially disclosed for reopening of the assessment – Impugned not is set aside and quashed.

Anil Kumar Bhandari Vs Joint Commissioner of Income Tax & Ors. (2007) 212 CTR (Cal) 439

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Revision – Erroneous and prejudicial order – Lack of proper enquiry – Assessee filing return on 31st December, 1999, claiming 1/5th revenue expenditure and treating the balance as deferred revenue expenditure – By letter dt. 26th December, 2001, assessee filed revised computation of income and claimed the entire expenditure as revenue expenditure – AO allowed the same- CIT revising the assessment on the ground that this could not be done without filing a revised return duly signed by a competent person as required under s. 140(c) – Not justified – For purposes of s. 263, the order of A.O should be found both erroneous and prejudicial simultaneously. CIT had not found the order of A.O ‘erroneous’ – Order of CIT did not also say as to how, by allowing the legitimate deduction to the assessee, any prejudice was caused to the Revenue – CIT, therefore, had no power to revise the assessment order – Correction in original return can be made by the Authorised Representative and provisions of s.140 (c) are not attracted.

Commissioner of Income Tax Vs Bharat Aluminium Co. Ltd. (2007) 212 CTR (Del) 296

Registration under s. 12A – Scope of enquiry by CIT - Sec-12AA confers power on the CIT while considering the application for registration of a trust or institution made under cl. (a) of s. 12A to call for such documents or information from the trust or institution as he thinks necessary in order to satisfy himself about the objects of the trust or institution and the genuineness of its activities, he shall pass an order in writing registering the trust or institution and if he is not satisfied, he would refuse the registration – Section 12AA does not speak anywhere that the CIT, while considering the application for registration, shall also see that the income derived by the trust or the institution is either not being spent for charitable purpose or such institution is earning profit- Profit earning misuse of the income derived by charitable institution from its charitable activities may be a ground for refusing exemption only with respect to that part of the income but can not be taken to be a synonym to the genuineness of the activities of the trust or the institution - While considering the registration under S. 12AA, the scope of enquiry of the CIT would be limited to the aforesaid extent – Tribunal had rightly found that the objects of the assessee society showed that none of the objects was against public policy and the main activity of the said society was to provide education to children from primary section to degree level and to improve the mental, social and other developments of the students – In case institution has defaulted in the matter of depositing contributions of the employees’ provident fund, the Act concerned shall take care of such default but into case it can be a ground for refusal of registration – Fee charged by the institution could not be said to be arbitrary – Objects of the assessee society undoubtedly were for charitable purposes and not against public policy- Income Tax Act, 1961, ss. 12A & 12AA.

CIT Vs Red Rose School (2007) 212 CTR (AII)

Section 158BE, read with section 132, of the Income Tax Act, 1961, - Block assessment in search cases – Time limit for completion of – Block period 1-4-1989 to 13-8-1999 – Whether a search is executed when last Panchnama is

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drawn – Held, yes, - Autrhorised Officer carried out search under section 132(1) on 13-8-1999 against assessee and her husband at their residential premises – Subsequently, Authorised Officer also carried out search by drawing a Panchnama under Section 132(1) on 23-08-1999 at premises where bank locker of assessee jointly owned with her husband was situated. Thereafter, Assessing Officer passed block assessment order in case of assessee on 28.09.2001- Whether in view of provisions of section 158BE, block assessment framed on 28.09.2001 was barred by limitation as it was completed after two years from end of month in which last panchnama was drawn (i.e., 23.08.1999) – Held, yes.

Smt. Neelam Aggarwal vs. Deputy Commissioner of Income Tax, Kanpur [2007] 17 SOT 579 (LUCK).

Cash Credits – Penalty – Concealment of Income – Company Share Application Money – Assessing Officer Directing assessee to prove genuineness of transactions – Assessee producing salary certificate and papers to show land holding – Finding that Assessing Officer failed to disprove claim of assessee as not genuine – Addition not justified – Imposition of penalty by treating share application money as concealed income – not sustainable - Income Tax Act, 1961, ss. 68, 271(1)(c).

Commissioner of Income Tax Vs Gobi Textiles Limited [2007] 294 ITR 663 (Mad)

Depreciation – User for business – Active or passive user – Machine kept ready for use but could not be used during the year in question on account of non-receipt of orders – Assessee would be entitled to depreciation – CIT Vs Vardhman Polytex Ltd. (2006) 203 CTR ( P & H) 397 followed.

Commissioner of Income Tax Vs Nahar Exports Ltd. (2007) 213 CTR ( P & H) 20.

Reassessment – Change of opinion – Different view on same facts – If the entire material was placed by the assessee before the A.O at the time of original assessment and the A.O had applied his mind to that material and accepted the view canvassed by the assessee, then the mere fact that he did not express this in the assessment order can not be a ground to conclude that income has escaped assessment - In the instant case, the assessee had placed all the material before the A.O and also clarified the doubt regarding certain matter – Simply because the A.O chose not to give any finding in this regard, that can not give him a reason to reopen the assessment or to contend that full and true disclosure was not made – A different view on the same facts will amount to change of opinion which is not permissible – Reopening of assessment was not justified.

Commissioner of Income Tax Vs Eicher Ltd. (2007) 213 CTR (Del) 57

Section 36(1)(vii) of the Income Tax Act, 1961 – Bad debts – Assessment year 2001-02 – Whether provision made by a Non-Banking Financial company

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(NBFC) in respect of Non-Performing Assets (NPAs) in its profits and loss account in accordance with prudential norms issued by Reserve bank of India (RBI) in exercise of powers conferred upon it under section 45JA of RBI Act, 1934, be classified as ‘bad debts’ and, be allowed as deduction under section 36(1)(vii) – Held, no.

New India Industries Ltd. Vs Assistant Commissioner of Income Tax, Circle 16(1), New Delhi [2007] 18 SOT 51 (DELHI) (SB)

Section 113 of the Income Tax Act, 1961 – Block assessment in search cases – Tax in case of – Block period 1-4-1990 to 3-7-2000 – Whether proviso contemplating levy of surcharge added to section 113 with effect from 1-6-2002 can not be considered as retrospective in its effect and, therefore, would not be applicable to search conducted prior to 1-6-2002 – Held, yes.

Commissioner of Income Tax, Jalandhar Vs. Rajiv Bhatara [2007] 165 Taxman 36 (Pun & Har.)

Appeal (Tribunal) – Rectification under s.254(2) – Mistake apparent – Order passed by Tribunal on the basis of decision of High Court subsequently overruled by Supreme Court suffers from mistake apparent rectifiable under s.254(2) – Sec. 254(2) does not provide that the error in the order should be seen with reference to the date on which it was passed.

Joint Commissioner of Income Tax Vs Miltons Ltd (2007) 112 TTJ(Mumbai) 167

Income Tax Act, 1961, ss. 158BC & 158BD

Search and seizure – Block assessment – Proceedings under s. 158BC vis-à-vis s. 158BD – Even though pronote in question was found during search of assessee’s husband, block assessment under s. 158BC in the hands of the assessee was valid as assessee’s locker was also searched and there can not be two assessments none under s. 158BC another under s. 158BD in respect of the same block period.

Smt. Renu Agarwal Vs Assistant Commissioner of Income Tax, ITAT, AGRA Branch (2007) 112 TTJ (Agra) 291

Circulars

Circular No. 7 of 2007 dated 23rd October, 2007

In the specified cases where no income has accrued to the non-resident due to cancellation of contract or where income has accrued but no tax is due on that income or tax is due at a lesser rate, the amount deposited to the credit of Government to that extent under Section 195, can not be said to be “tax”. It has been decided the amount can be refunded, subject to specified conditions.

Notifications

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Notification No.264/2007/F.No.142/25/2007-TPL

The Finance Act, 2007, amended the provisions of the Income Tax Act to provide that employers will be liable to pay fringe benefit tax on the value of ESOPs granted to employees as and when the ESOPs were allotted or transferred to the employees as and when the ESOPs were allotted or transferred to the employees. The value of ESOPs for the purposes of levy of FBT shall be the fair market value of the ESOPs on the date of vesting of the option as reduced by the amount actually paid, or recovered from, the employee.

Explanation (i) to clause (ba) of sub-section (1) of section 115WC of the Income Tax Act defines “fair market value” to mean the value determined in accordance with the method as may be prescribed by the Board. Accordingly, a new rule 40C has been inserted in the Income Tax Rules for this purpose.

The new rule 40C will take effect from the 1st April, 2008, and will, accordingly, apply in relation to the assessment year 2008-09 and subsequent years.

Notification No.271/2007/F.No.142/15/2007-TPL

Chapter XII-H relating to Fringe Benefit Tax, as provided in the Finance Act, 2005, is not applicable to the employer, being an individual or a Hindu undivided family or any fund or trust or institution eligible for exemption under clause (23C) of section 10 or registered under section 12AA, rule 3 is required to be amended so as to include valuation of perquisite in case of benefits provided by such employers to its employees. Accordingly, sub-rules 2, 6, 7 ( ii), (iii), (iv), (v) and (vi) have been inserted to provide for such valuation. Sub-rule 7(ix) has been inserted to provide for valuation of any other benefit or amenity, etc. in residual cases relating to any employer. These sub-rules will take effect from the 1st April, 2008 and will, accordingly, apply in relation to the assessment year 2008-09 and subsequent years.

Notification No. 270/2007/F.No.142/29/2007-TPLIn the Income Tax Rules, 1962, in Part-II, in rule 2BB, in sub-rule (2), in the Table, against serial number 12, in column 2 relating to name of allowance, the word “coal” shall be omitted.

VAT / SALES TAX JUDGMENTS –SH. RAKESH GARG -9810216270

Works contract : Provision denying benefit of composition of tax to dealers utilising goods purchased from outside State, is violative of article 14 of the Constitution of India but not of article 301 - B. Narayana Rao Works Contractor

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v. CTO and Maruthi Constructions v. Government of A. P. (2007) 10 VST 362 (AP).

Service of assessment order by affixture invalid unless other methods shown impracticable ; Service by Affixture long after closure of business ; No a valid service - Suresh Kumar (P.) v. State of Kerala (2007) 10 VST 240 (Ker).

Mere rejection of exemption claimed in the return does not make return false warranting penalty - Crompton Greeves Limited v. State of M. P. (MP) (2007) 10 VST 102 (MP).

The appellant (a leasing company) sold the capital goods at Rs. 0.75 lacs against the depreciated book value of Rs. 6.93 lacs. The Delhi Tribunal considered the transaction as suppression of the turnover and held that tax shall be levied on the depreciated value of Rs. 6.93 lacs. - Shree Leasing & Indl. Finance Co. Ltd. v. CTT (Appeal No.356/STT/04-05 dated 14.05.2007) (DVAT Tribunal).

Supply of medicines in various health care packages for lump sum amounts, being a service contract, is not subject to Sales tax ; Judgment of the Supreme Court in the case of BSNL v. Union of India relied upon - International Hospitals, Noida v. State of U.P. [2007] NTN 7 DPH- 37 (All).

Goods (modular furniture) manufactured in Maharashtra & sent to Delhi after charging full central sales tax and then assembled in Delhi ; It is an inter State sale from Maharashtra and not liable for deduction of tax in Delhi at source by contractee – Determination u/s 84 of DVAT Act in BP Ergo Ltd.; No. 172/CDVAT/2007/155 dated 04.10.2007.

Sale of goods effected to passengers on board during flight (Deccan Aviation Limited and Go-Airlines India Pvt. Ltd.) : Taxable under the Delhi VAT Act - Determination u/s 84 of DVAT Act in Amalgamated Bean Coffee Trading Co. Ltd. No. 156/CDVAT/2007/171 dated 21.11.2007.

CUSTOMS, CENTRAL EXICSE - BY SHRI P K MITTAL AND SERVICE TAX-

The Department is not entitled to take coercive action before the expiry of period of limitation in filing the appeal. The encashment of bank guarantee by the Department before the expiry of period for filing of an appeal is wholly impermissible. The quasi judicial authorities and the Departmental authorities cannot ignore the law laid down by the High Court and any disregard would amount to contempt of Court. Legrand India Pvt.Ltd. Vs. Union of India 2007 (216) ELT 678, BHC.

In case a job worker is manufacturing the product for the principal, valuation of assessable value of the finished product would be equal to (i) cost of raw material + conversion charges + value realized by the job worker in respect of scrap so sold by him and cannot be determined on the basis of 91% yield or 87% yield. Ferro Alloys Corporation Ltd. Vs. CCE 2007 (216) ELT 713 Tribunal.

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In case the Tribunal, while writing judgment did not consider the judgments cited by the Counsel for the Appellant, the judgment is liable to be recalled and the application for Rectification of Mistake has to be allowed. Tide Water Oil Company India Limited Vs. CCE 2007 (216) ELT 732 Tribunal.

The charge of clandestine removal of goods and non-payment of Excise Duty cannot rest merely on the basis of loading slip recovered from the premises of Transporter. The clandestine removal has to be established by the Department on the basis of tangible, cogent and affirmative evidences. Sonhill Cramics Pvt.Ltd. Vs. CCE 2007 (217) ELT 353 Tri.

For claiming Cenvat Credit on input, it is not necessary that input must be used in the manufacture of product but if it is sufficient that the input has been used in relation to the manufacture of the dutiable finished product even indirectly or remotely, the Cenvat credit is allowable. CCE Vs. Nepha Exports Pvt.Ltd. 2007 (217) ELT 355.

If a final order has been passed after 10 years from the date of hearing specially after the authority who heard the arguments has been transferred, such final order per-se bad in law and on the ground of delay alone, is liable to be set-aside. CCE Vs. PRECICHEM INDIA 2007 (217) ELT 357 HC.

In case the assessee collects any amount as “breakage charges” and the said amount represents neither the freight nor insurance charges, is liable to be included in the assessable value and the Excise Duty paid thereon. Gujarat Borossil Ltd. Vs. CCE 2007 (217) ELT 467.

In case few samples of the finished goods so produced are cleared for mandatory testing and before testing, the goods are not marketable, no Excise Duty is payable on clearance of such sample of finished goods for testing. RCC Sales Pvt.Ltd. Vs. CCE 2007 (217) ELT 379.

In case of failure or neglect by the Company to meet the Export Obligation, the penalty could not be imposed upon the Promoter Director unless there are findings of fraud or mis-appropriation against the Directors against whom penalties are sought to be imposed. Abhay Oswal Vs. CCE 2007 (217) ELT 381 Tribunal.

The Appellant is a Private Limited Company manufacturing goods and the buyer is a Partnership firm. The four Directors of

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the Private Limited Company are Partners in the partnership firm, yet, the price at which the goods are sold by the Private Limited Company to the partnership firm, would be acceptable in case the Department failed to establish mutuality of interest between the two so as to attract the provisions of Rule 8 and Rule 9 of the Central Excise (Valuation) Rules, 2000. R.B.Aggarwala Company Pvt.Ltd. Vs CCE 2007 (217) ELT 417 Tribunal Kolkata.

Goods Transport Agency has been engaged for transportation of goods from the place of removal i.e. factory gate to the customers’ go-down, the transportation cannot be said to be directly or indirectly in relation to clearance of goods as the goods already stood cleared at the factory gate. The Cenvat Credit of Service Tax paid on transportation of goods from the depot or factory (both being place of removal) cannot be availed by the assessee. Indian Japan Lighting Pvt Ltd Vs. CCE 2007(8) STR 124 (Tri)

The appellant received commission for only procurement of orders for and on behalf of principal and did not deal with the goods of the principal and hence the appellant will not fall within the category of Clearing and Forwarding Agent and not liable to pay Service Tax. Opel Alloys Pvt Ltd Vs. CCE 2007 (8) STR 159 (Tri) Delhi.

The amount on account of loading, unloading, coolie, cartage, handling, portage, lorry freight charges collected on behalf of customers, are not liable to be included in the taxable value and would not subject to payment of Service Tax thereon. UM Thariath & Co Vs. CCE 2007 (8) STR 161 (Tri- Bangalore).

CIVIL LAW ,CORPORATE LAWS & COMPANIES ACT– BY SHRI P K MITTAL

Even if an employee has been acquitted in criminal case by the court, yet the departmental proceedings can continue and the employee cannot be seek to quash the departmental proceedings. In criminal cases, guilt has to be proved beyond reasonable doubt, but, however, in case of departmental proceedings, mis-conduct has to be established which could be proved on the basis of preponderance of probabilities. Therefore, no automatic discharge in civil proceedings. Dhan Singh Karki Vs. Bureau of Indian Standards 2007 (143) DLT 681 Delhi HC –DB.

If the date of acknowledgement of debt is 30.7.2002 and for the purpose of calculating the period of three years for filing the suit for recovery of money, the date of 30.7.2002 has to be excluded

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and the limitation would start running from 31.7.2002 and would end on 30.7.2005 and within which time, the suit for recovery of money must be filed so as to be within a period of limitation as prescribed under the Limitation Act. Praveen Kumar Vs. Sunder Singh Makkar 2007 (144) DLT 813. DHC.

The Security Deposit or earnest money cannot be forfeited unless the Second Party is able to establish that the have actually suffered losses and damages due to breach of the contract by First Party. Kailash Nath & Associates Vs. DDA 207 (144)DLT 1 DHC.

If the written statement has not been filed within a period of 90 days from the service of copy of the plaint upon the defendant, his right to file written statement could be closed if the application for extension of time to fie WS does not contain clear and specific reasons for not filing WS within the maximum of 90 days. Kalpana Vs. Super Casettes Industries Ltd 2007 (1440 DLT 881 (Delhi HC-DB).

Once the possession of the secured/mortgaged assets has been taken over by the financial institutions/banks and that the said order has been challenged by the aggrieved party before Debt Recovery Tribunal, the Tribunal shall only order for restoration of the property to the borrower after examining the whole case and accepting the evidence led by the parties. In other words, restoration cannot be ordered by way of interim relief. Syndicate Bank Vs. Basalingappa 2007 (80) CLA 237 Karnataka High Court.

In case un-registered sub-broker of a Stock Exchange file a recovery suit against a non-member of the Stock Exchange client for recovery of dues, recovery suit would be maintainable and it is not necessary that the party to approach the National Stock Exchange of India Ltd for statutory arbitration. Asha Anil Kumar Vs. Ashok Kumar 2007 (80) CLA 323 Bombay.

A party is entitled to claim amounts on account of loss of profit. In case under an agreement, party was to supply spice of 1,00,000 kgs. to the other party and other party was to earn a profit of Rs. 2/- per kg on its subsequent sale in export market, in the event of non-suppy of agreed quantity to the other party, the other party could not meet its export commitments. Hence, the other party/aggrieved party is entitled to the loss of profit of Rs. 2/- lakh (i.e. 1,00,000 x 2). In other words, the party is entitled to claim even the notional profit he would have earned in the business transaction. Excel Cardamom Vs. Spices Trading Corporation Ltd. 2007 (143) DLT 159 DHC.

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In the notice under Section 138 of NI Act for dishonour of cheque, even if the designation of the person in the company is not mentioned and the sent has been sent at his residence, no fault could be found with the notice and compliance cannot be quashed on this hyper technical grounds. The court held that the procedure is handmaid of justice. The hyper technicalities cannot be allowed to defeat the substantive justice. Krishna Gupta Vs. Sita Ram Singhal 2007 (144) DLT 782. DHC

To enable to file a petition under Section 397 and 399 of the Companies Act, 1956, one is required to hold one tenth of the issued capital of the company which would include not only the paid equity share capital but also the preference share capital for determining the entitlement. Northern Projects Ltd Vs. Blue Coast Hotel & Resorts Ltd 2007 (81) CLA 7 (CLB).

After Scheme of Arrangement under Section 391 of the Companies Act, 1956 has been approved by the High Court, the Court will have power to issue directions from time to time in regard to any issue or order modification of the Scheme as may be desired. Further, the court may grant such other or further reliefs as may not have been prayed for in the Main Petition for the proper working the Company. Reliance Natural Resources Ltd Vs. Reliance Industries Ltd 2007 (81) ClA 21 (Bombay High Court).

In petition under Section 397 and 399 of the Companeis act, 1956 for oppression and mis-management, where the conduct of the Respondent has been malafide and they are guilty of breach of their fudiciary duties and their conduct has been burdensome and harsh, the Company Law Board has directed the (i) Respondents directors to restore the funds so siphoned off to the company (ii) appointment of independent director (iii) declaring appointment of directors as illegal (iv) restoring the directorship of those directors who have been illegally removed. Ramesh Chander Bammi Vs. Pindi Roadlinks (P) Ltd 207 (81) CLA 97 CLB.

CONTRACT LAWS & ARBITRATION LAWS – BY SHRI P K MITTAL

Once a settlement has been arrived at between the parties under the old agreement which provided settlement of disputes through arbitration, subsequently a dispute arises due to non payment either in full or part by the party, non-payment provides an independent cause of action and the party will not be entitled to recourse to arbitration as provided in the old agreement unless it is provided that the performance of the satisfaction was a condition precedent for discharge under the contract. Wherever there is an accord, obligations under the original contract would be discharged until and unless it is specifically provided that the

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performance of the satisfaction would discharge the obligations under the contract. Seema hatia Vs. Yahama Motor India Pvt Ltd 2007 (144) DLT 772. DHC.

In a petition under Section 8 of the Arbitration & Conciliation At, 1996, the photocopy of the Lease Agreement could be taken on record and the arbitration clause contained in the agreement could be seen and the parties may be directed to approach arbitrators for redressal of their grievances. Bharat Sewa Sansthan Vs. UP Electronic Corporation Ltd 2007 (21) CLA-BL-Supp.230 (SC).

TRADE MARK,COPYRIGHT ACT & PATENTS LAWS – BY SHRI P K MITTAL

In case, under Trade Marks Act, if the time of two months has been prescribed for filing of evidence by way of affidavit before the Registrar of Trade Mark and he has the power to condone the delay beyond two month but upto a period of one more month, then in that event, if the evidence if filed beyond a total period of one month, i.e. beyond the total period of three months, the Registrar Trade Mark has absolutely no authority to condone the delay. In other words, quasi-judicial or administrative authority has no power to condone the delay beyond the maximum period prescribed under the law. Sunrider Corporation Ltd. Vs. Hindustan Lever Ltd. 2007 (DLT) 143 Page 148 DHC-DB.

If a person is selling Aatta under a Trade Mark “Shakti Bhog”, he cannot prevent another party from selling their product under the Trade Mark “Shiva Shakti” with device Trishul and Damaru specially when two samples are quite dissimilar and there is no phonetic similarity between the two Trade Mark and, therefore, no party cannot object to other selling its products under the said Trade Mark i.e. Shiv Shakti. Kewal Krishan Kumar Vs. Rudi Roller Flour Mills Ltd. 2007 (144) DLT 647.

The software sold by the defendant to its customers were pirated version of the software developed by the plaintiff company i.e. Microsoft Corporation and further defendant also copied the Trade Mark “Microsoft” and, therefore, the defendant besides being restrained from copying, selling the pirated software, were settled with the only token damages to the tune of Rs.5 lacs. Microsoft Corporation Vs. Kiran 2007(144) DLT 274. DHC

The Mother Dairy sells its products under the trade mark “SAFAL”

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the defendant is selling its products under the trade mark “SAKAL” and adopted the almost similar logo as that the Mother Dairy and package design is that of ‘SAFAL”, the defendant, therefore, infringed “Trade Mark, Copyright” and liable to be restrained from selling its products under Trade Mark “SAKAL” and also liable to damages to the tune of Rs.5 lacs to the Mother Dairy. Mother Dairy Fruit & Veg Pvt Ltd Vs. green Village Agro (P) Ltd 2007(144) DLT 73.(DHC).

Before retrenching a workman, he has to be given one months’ notice and this requirement is mandatory in nature and if either no notice or shorter notice, the retrenchment shall be illegal. Once termination is held to be illegal, award of back wages is not automatic, the workman has to plead and lead evidence – as otherwise, it is highly difficult to comprehend that the workman remained unemployed after termination and there is always discretion lies with the Court about the quantum of grant of back wages. Workmen ITPO Vs. Management ITPO 2007 (144) DLT 32.

COMPANIES ACT AND MRTP ACT - BY P K MITTAL

The Scheme of arrangement U/s 391 of the Companies Act, 1956 could be challenged where the objection raised by the creditor go to the route of the matter and the scheme tented with unfairness. TCI Infrastructure Finance Ltd. 2007 (80) CLA 396 Rajasthan.

Where a complaint U/s 113 of the Companies Act, has been filed after more than one year from the date of knowledge of commission of offence, the same would be barred by law of limitation prescribed U/s 468 of Cr.P.C. Such stale complaint are liable to be quashed U/s 482 of Cr.P.C. by the High Court Vinod Baid Vs. State of A.P. 2007 (80) CLA 425 A.P.

Where the Company has completed all formalities for shifting of Registered Office, but however, the Registrar of Companies does not register the return about the shifting of Registered office to a new place, the Notice U/s 433 and 434 sent at the new address is full compliance and the party cannot be heard to say that since ROC has not registered the return informing new address, therefore, service of statutory notice at new address is not full compliance of law. Munirabad Chemicals Co. Vs. RC Modi Exports Pvt. Ltd. 2007 (80) CLA 447 Bombay.

Section 111(4) of the Companies Act,1956 does not prescribe any time limit for making application for rectification of Register of Members and, therefore, Article 137 of the Limitation Act would

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apply. Even if there are serious disputed questions of facts, yet CLB will itself decide and will not throw the petition and will not call upon the parties to approach the Civil Court for determination of title of Shares. Dhruv Agrawal Vs. Bunny Investment and Finance Pvt.Ltd. 2007 (80) 452 Company Law Board.

In case a party fails to comply with the orders of the Company Law Board as well undertaking to repay the deposit of the depositors of the company, such deliberate action would amount to contempt of court and proceedings U/s 12 of the Contempt of Court Act shall lie against the Company. EDPUGANTIBAPANAIAH Vs. K.S.Raju 2007 (80) CLA 474 (A.P).

The Company Law Board and the Company Court, in exercise of Appellate Power U/s 402 of the Companies Act, 1956, can grant any relief or order to the oppressed Petitioner, even contrary to the provisions of Articles of Association of the Company and further has a right to terminate, quash and order alteration of the contractual agreements entered into between the parties. Even a single act on the part of Respondent, who is managing the Company, whereby he disturbs the percentage of equity held by the Petitioner, would entitle the Petitioner to file and maintain the petition U/s 397 and 398 of the Companies Act, 1956. Pearson Education Inc. Vs. Printece Hall India Pvt. Ltd. 2006 (80) CLA 234 Delhi HC.

The Company Law Board, in exercise of powers U/s 402, has inherent powers to give directions to meet the end of justice and further, till the decision of the petition, can grants such further interim order or relief, which may be of the widest aptitude to ensure the delay or ultimate decision in the petition is not frustrated by taking such actions or steps by the Respondents. Star Linker & Company Vs. Lohia Star Linker Ltd. 2007 (80) CLA 255 Allahabad.

Once the Scheme of arrangement, as postulated U/s 391 and 394 of the Companies Act, 1956, as approved by a majority of shareholders, The Supreme Court held that no Court shall ordinarily sit over it as an Appellate Court over the commercial wisdom of the shareholders of a Company even in respect of a company which has already gone into liquidation. Meghal Homes Pvt.Ltd. Vs. Srinivas Girni K.K.Samithi 2007 (80) CLA 304 SC.

VERY IMPORTANT JUDGEMNTS:

When no period of limitation is prescribed under the Punjab Sales Tax Law for re-opening of Order of Assessment, such power

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to be exercised within a reasonable period and the reasonable period would be between 3 to 5 years. Further, the Supreme Court held that the question of limitation is a jurisdictional issue, therefore, a writ petition would be maintainable for quashing of Show Cause Notice instead of calling upon the petitioner to invoke the remedy prescribed under the Punjab Sales Tax Act. State of Punjab Vs. Bhatinda District Cooperative Milk Producers Union Ltd. 2007 (217) ELT 325 SC.

By virtue of any law, if the court does not have jurisdiction to entertain any particular claim or matter, neither the consent or acquiescence by the parties were confer jurisdiction upon the court to try and decide the matter. Harshad Chiman Lal Modi Vs. DLF Universal & another AIR 2005 2005 SC 4446.

ARTICLE ON TRANSITOF DEVGURU JUPITER – BY SHRI PRADEEP K. AGGARWAL - CHARTERED ACCOUNTANT-9811300732

Dev Guru Jupiter has after 13 months changes its position on the night of 21st Nov. 2007 and has moved in its own house after 12 years. This change happens every 12 years because in 11 years it remains in other Rashis. Jupiter will remain in Sagittarius until 9th Dec. 2008. There was great hue and cry among astrological circles that some thing great will happen after 21st Nov 2007. Not much wrong! Jupiter is supposed to be benefic planet and generally bestows good results. It is hoped that Jupiter will bestow good results to everyone except few rashis because exceptions are every where.

This transit of Jupiter will give great power and benefic results to children born between21st Nov. 2007 till 9th of Dec. 2008 and these children will be able to attain super heights in the field of Education, Religion and politics. This change will also give stunning results to Actors, Players and Politicians. Spiritual and religious Gurus will have their say and there will be overall progress and new researches in the field of science and education.

Persons born in Aries, Gemini, Leo , Scorpio and Aquarius are getting sudden gains and job promotions due to this change of Jupiter only.

Before 21st Nov 2007 Jupiter bestowed good results to persons of Taurus, Cancer, Libra, Capricorn and Pieces and now they are ready to bestow good results to the persons of born in Aries, Gemini, Leo, Scorpio and Aquarius rashis.

Jupiter bestows good results when transiting in 2nd, 5th, 7th, 9th and 11th houses from birth rashis e.g. Jupiter is presently transiting in 2nd house from Scorpio born persons. If there is good Dasha and Antardasha in horoscope, Jupiter will definitely provide good

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results. Jupiter is Teacher of God, priest of highest degree and Lord Shiva is his deity.

Jupiter has heavy body, and governs education, knowledge, children, fame, political power, properties and also representative of husband in female horoscope. Jupiter’s vehicle is chariot run by 8 horses who run at wind speed. Jupiter likes sweets, yellow clothes, gold and its jewel is TOPAZ. He resides in temples educational institutes and religious places.

Jupiter is the biggest planet in Galaxy. If Jupiter is placed in 9th house in one’s horoscope, that person attains many things through luck only. Jupiter placed in cancer sign becomes exalted and in Capricorn it becomes debilitated.

Persons born in Aries, Gemini, Cancer, Leo, Virgo, Scorpio, Sagittarius, Aquarius, ascendants, if Jupiter is strong, it will give extra ordinary results in its Mahadasha of 26 years.

All those who have favorable Jupiter in their horoscope they should worship Jupiter, they should observe fast, offer grams and sweet GUR and those with unfavorable Jupiter, can minimize their bad effects by doing above remedies.

Transit of Jupiter may have following impact on persons born in 12 Rashis as under:-

ARIES: Lucky, Religious travel, money gains, employment opportunities.

TAURUS: Unfruitful travel, losses, defamations.

GEMINI: Pleasant traveling, spouse support and fame

CANCER: Trouble from enemies and relatives, deceases, theft, success in business

LEO: Income gains, transfers, saint blessings, political achievements.

VIRGO: False allegations, tensions from relatives, vehicle purchase, income Gains, caution in traveling.

LIBRA: Excellency in Writings, theft during traveling, change of place, health Problems.

SCORPIO: Money gains, family accord, money gains through speech, new respo- nsibilities and spiritual inclinations.

SAGGITARIUS: Job transfer, unwanted enemies, name and fame happiness from Children.

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CAPRICORN: Monetary problems, failure in work, losses from change of place, Businessmen and servicemen will be disappointed.

ACQUARIOUS: Job promotions, desired transfer, may get award, help from relatives.

PIECES: Money gains, trouble from false allegations, care for children, change of place chances, Help from Govt. sector. Gains to politicians.

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DISCLAIMERS

All reasonable care has been exercised in compilation of information in this report. However, the PKMG Law Chambers, its members on panel(s) or advisors or employees shall not in any way be responsible for the consequences of any action taken on the basis of reliance upon the contents.

This report has been sent to you upon your being a client or associate of the PKMG Law Chambers or on the recommendation/suggestion of any of our client or associates. This not a spam mail.

CIRCULATION BY

This Report is circulated by Shri Praveen K. Mittal for PKMG Law Chambers, 171 Chitra Vihar, Delhi-110 092, Phones: (011) 22540549, 22524229, 9810826436, 9811044365

Email: pkm171@yahoo.com

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