“In a system like ours where the pendency is very high and legal procedure
Is not time bound, mediation is a handy process for litigants looking for an
Out of court settlement. At the same time, like any other process, it is open
to abuse and an opportunity to buy time and delay proceedings.”
Advocate Sanjana Bali
Partner, KB Partners &
Guest Faculty, Delhi University
Monday, July 27, 2009
MEDIATION
“Mediation is a device to put ego in the background and bring parties together face to face and good offices of the mediator are used to ease tension and find out a solution through give and take to put an end to litigation.”
Advocate R K Kapoor Sr. Partner, KB
Advocate R K Kapoor Sr. Partner, KB
MEDIATION
“Mediation can be very good in matrimonial and family disputes. If mediator is skilled and clear-headed, mediation can be very fruitful in other disputes as well.”
Prashant Bhushan
Public Intrest Lawyer and Activist
Prashant Bhushan
Public Intrest Lawyer and Activist
MEDIATION
“I have always recommended completion of proceedings by mediation. What can be a better method of resolving dispute than by a mutual settlement between the parties who always remain in command of their case?”
Hon’ble Justice (Retd.) R S Sodhi
Delhi High Court
Hon’ble Justice (Retd.) R S Sodhi
Delhi High Court
MEDIATION
“Mediation is a voluntary and confidential in which, through the Intervention of a person called the ‘mediator’, who is a neutral and Impartial person, the parties are facilitated to come to a voluntary And mutually acceptable resolution of their dispute. The mediator guides the process but cannot impose any decision on the parties. The parties remain in control of the process throughout, and they can terminate the mediation at any time if they feel it is not serving their interests. However, once an agreement is reached and signed by the parties, it becomes binding on them and can be enforced by the legal process.”
Hon’ble Justice Markandey Katju
Supreme Court
Hon’ble Justice Markandey Katju
Supreme Court
MEDIATION
“Given the numbers of pending cases all over the country, it is Imperative to encourage ADR mechanisms, particularly mediation, at the taluka and district levels. All the stakeholders in justice delivery- lawyers, judges and institutions need to make a determined effort in this regard. Given the experience of the Delhi Mediation Centre(in the district courts in Tis Hazari, Kakardooma and Rohini), I have no doubt that if a concerted effort is made to resolve disputes through mediation then justice delivery will be more expeditious, affordable and accessible to all.”
Hon’ble Justice Madan B Lokur
Delhi High Court
Hon’ble Justice Madan B Lokur
Delhi High Court
MEDIATION
“In the 1980’s mediation gained momentum in USA, with the development of progressive mediator training standards. Advocates were provided training in mediation and ethical standards to be followed during the process. Consequently, mediation formed a substantial part of the practice for many advocates. The legal fraternity incorporated it into the American legal system by responding favorably to the technique of mediation. Since then, advocates have successfully enhanced their practice, rather than reducing it, through use of mediation. In spite of being initially opposed and doubted, mediation was soon considered to be one of the most useful tools for lawyers. It augmented speedy and amicable dispute resolution on the other.
Mediation session requires that both the counsel and his client plan in advance their course of action and express clearly the extent to which they are ready to concede and their offer towards compromise, in order to shape realistic and durable settlement. An advocate should include all of the above factors in account while preparing the client. The advocate’s premeditation session with the clients provides context for the dispute outlines the legal and factual complexities of the case and disseminates critical information with regard to the nature of bossiness, personalities and relationship of the parties involved in the conflict. Pre-mediation session with the client helps in setting the stage for the actual mediation session.”
Mediation session requires that both the counsel and his client plan in advance their course of action and express clearly the extent to which they are ready to concede and their offer towards compromise, in order to shape realistic and durable settlement. An advocate should include all of the above factors in account while preparing the client. The advocate’s premeditation session with the clients provides context for the dispute outlines the legal and factual complexities of the case and disseminates critical information with regard to the nature of bossiness, personalities and relationship of the parties involved in the conflict. Pre-mediation session with the client helps in setting the stage for the actual mediation session.”
MEDIATION
On September 6, 2008, Hon’ble Chief Justice of India K G Balakrishanan inaugurated a Lok Adalat Cum Mediation Cell in the apex Court. Hon’ble Justices Arijit Pasayat, S B Sinha, Dalveer Bhandari, H S Bedi, M K Sharma and many other Judges of Supreme Courts as well as various High Courts are vigorously promoting mediation movement by sanctioning and approving the use of ‘mediation’ as a process for settlement of disputes, within their jurisdictions.”
MEDIATION
“Mediation and Conciliation Project Committee (the “Committee”) was constituted on April 9, 2005 by Hon’ble Chief Justice of India under the auspices of the Supreme Court to provide centralized directions and support for mediation efforts in India. The Committee comprises of Hon’ble Justice S B Singha as Chairman, Hon’ble Justice R V Raveendran, Hon’ble Chief Justice (Retd.) A M Ahmadi, Hon’ble Justice Madan B lakur, Sr. Advocate P P Rao, Sr. Advocate Raju Ramachandran, Member Secretary of NALSA and Registrar of the Supreme Court as member Secretary of the Committee. The Committee has initiated the pilot project in August 2005 in Delhi District Courts for settlement of disputes through mediation. Delhi Mediation Centre initiated by the Committee runs the pilot project in the District Courts of Delhi. Mediation Centre is a member of the Asian Mediation Association (AMA) which was formed in Singapore on August 17 2007. Other members of AMA are Hong Kong, Indonesian, Malaysian, Philippine and Singapore Mediation Centre.”
MEDIATION
”Judges explore the possibilities of settlement in maters newly filed before them and even in pending cases. Such matters are them referred to the trained mediators for an amicable settlement. Today, law permits mediation and the courts are encouraging it. Using its supervisory jurisdiction over subordinate judiciary, High Courts have established court annexed mediation cells in District Courts as well. Its outcome has been impressive as nearly 60 percent of the referred matters have been settled through mediation. Delhi High Court on August 11, 2005 notified Mediation and Conciliation Rules, 2004 and all mediation matters in Delhi High Court are being conducted in accordance with these rules. Other High Courts are also following suit by adapting this notification.”
MEDIATION
Recently, the mediation process has brought three proceedings-under Section 498-A and Section 34 of the Indian Penal Code, 1860(IPC); under section 125, the Code of Criminal Procedure(Cr.P.C.) and under Section 13 of the Hindu Marriage Act, 1953- pending in three different courts, to an end. This order was passed by the Supreme Courts in Transfer Petition (C) No. 421 of 2008 on March 3, 2009.”
Thursday, May 7, 2009
LLP
Meaning- Limited Liability Partnership:
Limited Liability Partnership (LLP) is also known as Professional Association, in which the liability of the investor/partner is limited to the amount invested by him/her in the business.
Nature- Limited Liability Partnership:
LLP has elements of partnerships and corporations. In an LLP, all partners have a form of limited liability, similar to that of the shareholders of a corporation. However, the partners have the right to manage the business directly, and a different level of tax liability than in a corporation.
Difference- Limited Liability Partnership and Limited Partnership:
Limited Liability Partnerships (LLP) are distinct from limited partnerships, in that limited liability is granted to all partners, not to a subset of non-managing "limited partners". As a result the LLP is more suited for businesses where all investors wish to take an active role in management.
LLP- General View:
LLP laws exist in various developed countries like the UK, the US, Australia and Singapore. Introduction of LLP laws in some countries results from the need of professional firms who not only want the tax benefits and traditional structure of a partnership but also the protection from unlimited liability. In the United States, each individual state has its own law governing their formation. Limited liability partnerships emerged in the early 1990s popular among professionals, particularly lawyers, accountants and architects. An obligation of a partnership incurred while the partnership is a limited liability partnership, whether arising in contract, tort, or otherwise, is solely the obligation of the partnership. A partner is not personally liable, directly or indirectly, by way of contribution or otherwise, for such an obligation solely by reason of being or so acting as a partner. As in a partnership or limited liability company (LLC), the profits of an LLP are distributed among the partners for tax purposes, avoiding the problem of "double taxation" often found in corporations.
In the U.K, LLPs are governed by the LL .Pact. A UK Limited Liability Partnership is a Corporate body - that is to say, it has a continuing legal existence independent of its Members, as compared to a partnership which may (in England and Wales they do not) have a legal existence dependent upon its Membership. A UK LLP is tax transparent or pass-through for tax purposes, that is to say it pays no tax but its Members do in relation to the income or gains they receive through the LLP. There is in fact no requirement for the LLP agreement even to be in writing because simple partnership-based regulations apply by way of default provisions. It has to date been closely replicated by Japan and by the financial centers of Dubai and Qatar. It is perhaps closest in nature to the limited liability company although it may be distinguished from that entity by the fact that the LLC, while having a legal existence independent of its Members is not technically a corporate body because its legal existence is time limited and therefore not "continuing".
Limited liability partnerships were introduced in Japan in 2005 during a large-scale revamp of the country's laws governing business organizations. Japanese LLPs may be formed for any purpose (although the purpose must be clearly stated in the partnership agreement and cannot be general), have full limited liability and are treated as pass-through entities for tax purposes. However, each partner in an LLP must take an active role in the business, so the model is more suitable for joint ventures and small businesses than for companies in which investors plan to take passive roles. Japanese LLPs may not be used by lawyers or accountants, as these professions are required to do business through an unlimited liability entity.
A Japanese LLP is not a corporation, but rather exists as a contractual relationship between the partners, similarly to an American LLP. A limited liability partnership is a form of organisation which PROTECTS a partner's assets from limitless liabilities. In LLP, every partner will be an agent of the partnership and not of the other partners,
It promises perpetual succession and a distinct legal identity were it to become law. Further, it requires only a minimum of two partners, having no cap on the maximum number of partners a firm can have.
Limited Liability Partnership: An Indian Prospective
Due to the legal stipulation of unlimited liability among partners, Indian partnerships are mostly restricted to family members and persons who know each other thoroughly. LLP being a form of partnership having characteristics of a company will limit liability in the case of business failure or professional negligence.
Characteristics of LLP Bill, 2008:
1. The LLP will be an alternative corporate business vehicle that would give the benefits of limited liability but would allow its members the flexibility of organizing their internal structure as a partnership based on an agreement.
2. The LLP Act does not restrict the benefit of LLP structure to certain classes of professionals only and would be available for use by any enterprise which fulfills the requirements of the Act.
3. While the LLP will be a separate legal entity, liable to the full extent of its assets, the liability of the partners would be limited to their agreed contribution in the LLP. Further, no partner would be liable on account of the independent or un-authorized actions of other partners, thus allowing individual partners to be shielded from joint liability created by another partner's wrongful business decisions or misconduct.
4. LLP shall be a body corporate and a legal entity separate from its partners. It will have perpetual succession. Indian Partnership Act, 1932 shall not be applicable to LLPs and there shall not be any upper limit on number of partners in an LLP unlike an ordinary partnership firm where the maximum number of partners cannot exceed 20.
5. The taxation of LLPs shall be addressed in the Income Tax Act, 1961 which regulates taxation of all form of entities.
6. Provisions have been made for corporate actions like mergers, amalgamations etc.
7. While enabling provisions in respect of winding up and dissolutions of LLPs have been made, detailed provisions in this regard would be provided by way of rules under the Act.
8. The Act also provides for conversion of existing partnership firm, private limited company and unlisted public company into a LLP.
By passing the Limited Liability Partnership Bill, 2008 the Indian Partnership has been put to a par with foreign firms.
Concept Limited Liability Partnership:
The LLP Bill has facilitated creation of a new corporate structure that will boost growth in the economy, particularly in professional advisory services in accounting, legal and insurance industries. LLPs make it easier for investors and professionals to jointly do businesses that involve greater risk.
Concept of LLP- Winding Up & Dissolution:
• The partner has fiduciary duties towards LLP and other partners. He should account to the LLP any profit or benefit derived in the conduct and winding up of the LLP activities or use of property and should refrain from competing with the LLP in the conduct or winding up of the LLP.
• A partner's economic rights in the LLP are freely transferable. A transfer in whole or in part of a partner's transferable interest is permissible and does not by itself cause the partner's disassociation or a dissolution and winding up of the LLP. The transfer does not entitle the assignee to participate in the management or conduct of the LLP's activities nor access to information concerning the LLP's transactions.
• Winding up of an LLP may be either voluntary or by the Company Law Tribunal.
• Dissolution: An LLP can be dissolved by agreement of the members. When LLP becomes insolvent, creditors can initiate winding up proceedings. In the winding up of LLP, past and present members are liable to contribute to the extent they have agreed to do in the LLP agreement.
Conclusion:
Need of a LLP:
In an increasingly litigious market environment, the prospect of being a member of a partnership firm with unlimited liability is risky and unattractive. This makes LLP the most suitable vehicle for partnerships among professionals, and puts them on a level-playing field with foreign professional firms.
Monday, May 4, 2009
Need for the New Corporate Form - LLP
With the growth of the Indian economy, the role played by its entrepreneurs as well as its technical and professional manpower has been acknowledged internationally. It is felt opportune that entrepreneurship, knowledge and risk capital combine to provide a further impetus to India’s economic growth. In this background, a need has been felt for a new corporate form that would provide an alternative to the traditional partnership, with unlimited personal liability on the one hand, and, the statute-based governance structure of the limited liability company on the other, in order to enable professional expertise and entrepreneurial initiative to combine, organize and operate in flexible, innovative and efficient manner.
2. The Limited Liability Partnership (LLP) is viewed as an alternative corporate business vehicle that provides the benefits of limited liability but allows its members the flexibility of organizing their internal structure as a partnership based on a mutually arrived agreement. The LLP form would enable entrepreneurs, professionals and enterprises providing services of any kind or engaged in scientific and technical disciplines, to form commercially efficient vehicles suited to their requirements. Owing to flexibility in its structure and operation, the LLP would also be a suitable vehicle for small enterprises and for investment by venture capital.
3. keeping in mind the need of the day, the Parliament enacted the Limited Liability Partnership Act, 2008 which received the assent of the President on 7th January,2009.
The salient features of the LLP Act 2008 inter alia are as follows: -
The LLP shall be a body corporate and a legal entity separate from its partners. Any two or more persons, associated for carrying on a lawful business with a view to profit, may by subscribing their names to an incorporation document and filing the same with the Registrar, form a Limited Liability Partnership. The LLP will have perpetual succession;
(ii) The mutual rights and duties of partners of an LLP inter se and those of the LLP and its partners shall be governed by an agreement between partners or between the LLP and the partners subject to the provisions of the LLP Act 2008 . The act provides flexibility to devise the agreement as per their choice. In the absence of any such agreement, the mutual rights and duties shall be governed by the provisions of proposed the LLP Act;
(iii) The LLP will be a separate legal entity, liable to the full extent of its assets, with the liability of the partners being limited to their agreed contribution in the LLP which may be of tangible or intangible nature or both tangible and intangible in nature. No partner would be liable on account of the independent or un-authorized actions of other partners or their misconduct. The liabilities of the LLP and partners who are found to have acted with intent to defraud creditors or for any fraudulent purpose shall be unlimited for all or any of the debts or other liabilities of the LLP;
(iv) Every LLP shall have at least two partners and shall also have at least two individuals as Designated Partners, of whom at least one shall be resident in India. The duties and obligations of Designated Partners shall be as provided in the law;
(v) The LLP shall be under an obligation to maintain annual accounts reflecting true and fair view of its state of affairs. A statement of accounts and solvency shall be filed by every LLP with the Registrar every year. The accounts of LLPs shall also be audited, subject to any class of LLPs being exempted from this requirement by the Central Government;
(vi) The Central Government have powers to investigate the affairs of an LLP, if required, by appointment of competent Inspector for the purpose;
(vii) The compromise or arrangement including merger and amalgamation of LLPs shall be in accordance with the provisions of the LLP Act 2008;
(viii) A firm, private company or an unlisted public company is allowed to be converted into LLP in accordance with the provisions of the Act. Upon such conversion, on and from the date of certificate of registration issued by the Registrar in this regard, the effects of the conversion shall be such as are specified in the LLP Act. On and from the date of registration specified in the certificate of registration, all tangible (moveable or immoveable) and intangible property vested in the firm or the company, all assets, interests, rights, privileges, liabilities, obligations relating to the firm or the company, and the whole of the undertaking of the firm or the company, shall be transferred to and shall vest in the LLP without further assurance, act or deed and the firm or the company, shall be deemed to be dissolved and removed from the records of the Registrar of Firms or Registrar of Companies, as the case may be;
(ix) The winding up of the LLP may be either voluntary or by the Tribunal to be established under the Companies Act, 1956. Till the Tribunal is established, the power in this regard has been given to the High Court;
(x) The LLP Act 2008 confers powers on the Central Government to apply provisions of the Companies Act, 1956 as appropriate, by notification with such changes or modifications as deemed necessary. However, such notifications shall be laid in draft before each House of Parliament for a total period of 30 days and shall be subject to any modification as may be approved by both Houses;
(xi) The Indian Partnership Act, 1932 shall not be applicable to LLPs.Friday, April 24, 2009
Legal profession in India
Legal profession in India is an integral part of our system of administration of justice. Judiciary and legal profession go together—lawyers become
judges. It is keeping this essential feature of our Rule of Law that the legislature specifically spelt out in the Advocates Act, 1961, that practice of law in India would be open only to Indian citizens. This cannot be permitted to be diluted under any circumstances. There are more than a dozen lawyers, who are cabinet ministers in India. The President of India Pratibha Patil and Speaker of Lok Sabha Somnath Chatterjee belong to this profession. Consider the words of Justice Sandra Day O'Connor—while writing the foreword for the book, America’s Lawyer-Presidents: From Law Office to Oval Office—"our constitutional democracy has always relied on the talents and hard work of lawyers in private practice, public service, and political office... and of invaluable contributions the profession has made to the effective functioning of our nation." What is true about American lawyers is more true about contribution of Indian lawyers
. Where do foreign lawyers fit into the scheme of things in India? An article in the ET ‘Practice of Law & its Regulation’ (26 March 2009) suggested that the legal profession should be "recognised as a business instead of just a noble profession". If it is a business then it can be acquired, merged, amalgamated, taken over and sold to global players. Therefore, the suggestion is totally unacceptable. Those in favour of the entry of foreign lawyers in India essentially give four reasons: a) Indian lawyers lack the expertise and experience in handling international transactions in capital market, M&As etc. b) foreign lawyers would not practise Indian law and would not appear in Indian courts; c) practice of law under the Advocates Act implies practice of Indian law and accordingly there are no restrictions on foreign lawyers practising foreign law from Indian soil; d) already some foreign jurisdictions permit Indian lawyers to set up practice in those jurisdictions. In a recent conference on business laws organised by the International Bar Association (6-7 March) the bogey of foreign law firms' expertise, experience and technical know-how as compared to allegedly comparatively low calibre and competence of Indian law firms was shred to pieces—not by Indian lawyers but by top business corporates of the country: that Indian legal services are second to none and they do not, in any way, feel handicapped if foreign law firms are not located in India. As and when input is required from foreign experts, it is sought through Indian lawyers.Practice of law implies practice of any law in India—it may be practice of Indian law or law of any jurisdiction. Practice of law is not confined to court practice but also includes transactional work generally handled by law firms. Accordingly, as things stand today, only Indian citizens can practise law in India. Reciprocity is only in name. It is virtually impossible to get a work permit for an Indian lawyer to practise in the UK. In the US, lawyers practising in one state cannot generally practise in any other state and this applies to foreign lawyers also. Foreign law firms would practise Indian law by employing Indian lawyers. It would be difficult to monitor the embargo that they would not practise Indian law. There is nothing wrong in referrals being made by foreign law firms to Indian law firms and vice-versa. As a matter of fact, this has been the acknowledged practice. Depending upon the expertise of a foreign law firm in a particular area, Indian law firms do refer the clients to foreign lawyers in matters of IPOs etc. Similarly, foreign law firms refer either the clients or specific assignments to law firms in India in matters of jvs, transfer of technology, IPR, and income tax. By whatever name they are called, referrals are totally consistent with international practices and are necessary because we cannot be experts in foreign laws and vice-versa. Problems arise if there is any hidden agenda behind the façade of a referral arrangement. An effective, transparent and clean referral arrangement is a far better alternative to allowing foreign law firms to open offices in India. So far and by and large referral system has worked satisfactorily. The demand for opening legal services sector in India does not come from Indian businesses or professionals or even foreign multinational companies. Strangely, the demand comes from foreign lawyers and particularly those from the UK. It is obvious that the UK is witnessing a negative growth so far as legal profession is concerned. Accordingly, India and China offer good prospects—but the problem is that, in India, legal profession is not a business and it is not up for sale
judges. It is keeping this essential feature of our Rule of Law that the legislature specifically spelt out in the Advocates Act, 1961, that practice of law in India would be open only to Indian citizens. This cannot be permitted to be diluted under any circumstances. There are more than a dozen lawyers, who are cabinet ministers in India. The President of India Pratibha Patil and Speaker of Lok Sabha Somnath Chatterjee belong to this profession. Consider the words of Justice Sandra Day O'Connor—while writing the foreword for the book, America’s Lawyer-Presidents: From Law Office to Oval Office—"our constitutional democracy has always relied on the talents and hard work of lawyers in private practice, public service, and political office... and of invaluable contributions the profession has made to the effective functioning of our nation." What is true about American lawyers is more true about contribution of Indian lawyers
. Where do foreign lawyers fit into the scheme of things in India? An article in the ET ‘Practice of Law & its Regulation’ (26 March 2009) suggested that the legal profession should be "recognised as a business instead of just a noble profession". If it is a business then it can be acquired, merged, amalgamated, taken over and sold to global players. Therefore, the suggestion is totally unacceptable. Those in favour of the entry of foreign lawyers in India essentially give four reasons: a) Indian lawyers lack the expertise and experience in handling international transactions in capital market, M&As etc. b) foreign lawyers would not practise Indian law and would not appear in Indian courts; c) practice of law under the Advocates Act implies practice of Indian law and accordingly there are no restrictions on foreign lawyers practising foreign law from Indian soil; d) already some foreign jurisdictions permit Indian lawyers to set up practice in those jurisdictions. In a recent conference on business laws organised by the International Bar Association (6-7 March) the bogey of foreign law firms' expertise, experience and technical know-how as compared to allegedly comparatively low calibre and competence of Indian law firms was shred to pieces—not by Indian lawyers but by top business corporates of the country: that Indian legal services are second to none and they do not, in any way, feel handicapped if foreign law firms are not located in India. As and when input is required from foreign experts, it is sought through Indian lawyers.Practice of law implies practice of any law in India—it may be practice of Indian law or law of any jurisdiction. Practice of law is not confined to court practice but also includes transactional work generally handled by law firms. Accordingly, as things stand today, only Indian citizens can practise law in India. Reciprocity is only in name. It is virtually impossible to get a work permit for an Indian lawyer to practise in the UK. In the US, lawyers practising in one state cannot generally practise in any other state and this applies to foreign lawyers also. Foreign law firms would practise Indian law by employing Indian lawyers. It would be difficult to monitor the embargo that they would not practise Indian law. There is nothing wrong in referrals being made by foreign law firms to Indian law firms and vice-versa. As a matter of fact, this has been the acknowledged practice. Depending upon the expertise of a foreign law firm in a particular area, Indian law firms do refer the clients to foreign lawyers in matters of IPOs etc. Similarly, foreign law firms refer either the clients or specific assignments to law firms in India in matters of jvs, transfer of technology, IPR, and income tax. By whatever name they are called, referrals are totally consistent with international practices and are necessary because we cannot be experts in foreign laws and vice-versa. Problems arise if there is any hidden agenda behind the façade of a referral arrangement. An effective, transparent and clean referral arrangement is a far better alternative to allowing foreign law firms to open offices in India. So far and by and large referral system has worked satisfactorily. The demand for opening legal services sector in India does not come from Indian businesses or professionals or even foreign multinational companies. Strangely, the demand comes from foreign lawyers and particularly those from the UK. It is obvious that the UK is witnessing a negative growth so far as legal profession is concerned. Accordingly, India and China offer good prospects—but the problem is that, in India, legal profession is not a business and it is not up for sale
Banks' settlement
Banks' settlement
with defaulting borrowers will now specifically exclude criminal cases lodged and proceedings with regard to criminality
would continue even after the settlement of the civil cases, Indian Banks' Association (IBA) said on Thursday. The IBA decision comes against backdrop of two recent cases where the courts absolved the defaulting borrowers of any criminal wrongdoing who had entered into One Time Settlement (OTS) agreements with banks and where banks withdrew all charges against them. The new IBA measure has been taken after some of the bankers had a meeting with top officials of Central Vigilance Commission and the CBI. Settlement agreements with borrowers will now have a clause stating that the criminal proceedings, if any, would continue even after the settlement, IBA's Chief Executive K Ramakrishnan told reporters here today. He, however, said the number of settlements which involve criminal charges are very few. Explaining the IBA decision, M R Umarji, Legal Advisor to the Association said in some cases banks also file criminal cases against borrowers, who besides defaulting, indulge in cheating or wrongly declare their collaterals.
with defaulting borrowers will now specifically exclude criminal cases lodged and proceedings with regard to criminality
would continue even after the settlement of the civil cases, Indian Banks' Association (IBA) said on Thursday. The IBA decision comes against backdrop of two recent cases where the courts absolved the defaulting borrowers of any criminal wrongdoing who had entered into One Time Settlement (OTS) agreements with banks and where banks withdrew all charges against them. The new IBA measure has been taken after some of the bankers had a meeting with top officials of Central Vigilance Commission and the CBI. Settlement agreements with borrowers will now have a clause stating that the criminal proceedings, if any, would continue even after the settlement, IBA's Chief Executive K Ramakrishnan told reporters here today. He, however, said the number of settlements which involve criminal charges are very few. Explaining the IBA decision, M R Umarji, Legal Advisor to the Association said in some cases banks also file criminal cases against borrowers, who besides defaulting, indulge in cheating or wrongly declare their collaterals.
Thursday, April 23, 2009
The Delhi High Court has on April 18, 2009 struck down the levy of service tax on renting of immovable property as "unconstitutional"
The Delhi High Court has today struck down the levy of service tax on renting of immovable property as "unconstitutional", while deciding 26 writ petitions of different petitioners, by a combined order. The division bench of the Delhi High Court comprised of Mr. Justice Badar Durrez Ahmed and Mr. Justice Rajiv Shakdher observed that service tax shall not be levied on renting of immovable property.
Alishan Naqvee, Advocate, LexCounsel Law Offices, who represented his clients in two of the petitions disposed off today, tells that the category of "renting of immovable property service" was introduced by the Finance Act of 2007. This, in effect brought renting, letting, leasing, licensing or other similar arrangements of immovable property for use in the course of furtherance of business and commerce, within the service tax net with effect from June 1, 2007. This new levy severely impacted business models across India as most of the rent arrangements did not even stipulate it beforehand.
The businesses
across India opted to en masse challenge the constitutionality of levy of service tax on rent, on the primary grounds that renting does not involve any service, and the Central Government is not empowered to tax consideration for transfer of rights in immovable property, being a state subject as per the Constitution of India. Few High Courts, including the High Court of Mumbai, Delhi, Gujarat, Andhra Pradesh, Kolkata and Chennai reportedly granted interim reliefs to the petitioners from payment of service tax until final disposal of their matters. The stays were however granted subject to undertakings by the petitioners, mainly tenants, to deposit the service tax amount with the Government if the tax was ultimately held constitutional. The Delhi High Court however is the first High Court to deliver the final order in the matter that would have persuasive value for the other High Courts.
source: FPR
The detailed order of the Delhi High Court is expected to be available within the next couple of working days. One issue that needs to be seen is whether the Delhi High Court has expressly limited the applicability of its judgment to its territorial jurisdiction. Notably, while granting interim orders, the Delhi High Court had expressed that the stays would be operative within the territorial jurisdiction of the Court. Consequently, a number of petitioners, having operations in multiple states, were constrained to knock at the doors of the other High Courts.
To avoid multiplicity of litigation, the Union of India preferred a transfer petition to the Supreme Court of India seeking transfer of all writ petitions pending before different High Courts of India, to the Delhi High Court for single window adjudication.
It is open for the Government to prefer an appeal before the Supreme Court of India, challenging the decision of the Delhi High Court. The judgment however delivers great relief to the business by helping liquidity in the current times.
Alishan Naqvee, Advocate, LexCounsel Law Offices, who represented his clients in two of the petitions disposed off today, tells that the category of "renting of immovable property service" was introduced by the Finance Act of 2007. This, in effect brought renting, letting, leasing, licensing or other similar arrangements of immovable property for use in the course of furtherance of business and commerce, within the service tax net with effect from June 1, 2007. This new levy severely impacted business models across India as most of the rent arrangements did not even stipulate it beforehand.
The businesses
source: FPR
The detailed order of the Delhi High Court is expected to be available within the next couple of working days. One issue that needs to be seen is whether the Delhi High Court has expressly limited the applicability of its judgment to its territorial jurisdiction. Notably, while granting interim orders, the Delhi High Court had expressed that the stays would be operative within the territorial jurisdiction of the Court. Consequently, a number of petitioners, having operations in multiple states, were constrained to knock at the doors of the other High Courts.
To avoid multiplicity of litigation, the Union of India preferred a transfer petition to the Supreme Court of India seeking transfer of all writ petitions pending before different High Courts of India, to the Delhi High Court for single window adjudication.
It is open for the Government to prefer an appeal before the Supreme Court of India, challenging the decision of the Delhi High Court. The judgment however delivers great relief to the business by helping liquidity in the current times.
Sunday, April 19, 2009
Criminal Liability Under Section 138 of Negotiable Instruments Act, 1881
Introduction
Dealings in cheques are vital and important not only for the banking point of view but also for the commerce and industry and the economy of the country. Advent of cheques in the market have given a new dimension to the commercial and corporate world at a time when people have preferred to carry and execute a small piece of paper called cheque than carrying the currency worth the value of cheque. But pursuant to the rise in dealings with cheques also rises the malpractice of giving cheques without any intention of honoring them. Before 1988 there being no legal penal provisions to restrain people from issuing cheques without having sufficient funds in their account or any stringent provision to punish them in the vent of such cheque not being honoured by the drawer. Of course on dishonour of cheques accrues a civil liability. However in reality the processes to execute civil liability becomes notoriously dilatory and recover by way of a civil suit takes an inordinately long time. To ensure credibility of the negotiable instrument, a criminal offence was inserted in Negotiable Instruments Act, 1881 in form of the Banking, Public Financial Institutions and Negotiable Instruments Laws (Amendment) Act, 1988 which were further modified by the Negotiable Instruments (Amendment and Miscellaneous Provisions) Act, 2002
Scope
Section 138 of Negotiable Instruments Act, 1881 creates statutory offence in the matter of dishonour of cheques on the ground of insufficiency of funds etc out of the account maintained by a drawer. Section 138 of the Act creates statutory offence of the acts, which are not criminal in real sense, but are acts, which in public interest are prohibited., They are really only a summary mode of enforcing a civil right. Normally in criminal law existence of guilty intent is an essential ingredient of a crime. However the Legislature have created an offence of absolute liability or strict liability under Section 138 of Negotiable Instruments Act, 1881 where ‘mens rea’ is not at all necessary. Further the creation of the strict liability is an effective measure by encouraging greater vigilance to prevent usual callous or otherwise attitude of drawers of cheques in discharge of debts or otherwise attitude of drawers of cheques in discharge of debts or otherwise.
The circumstances under which dishonour of cheque takes place or that may contribute to the situation would be irrelevant and are required to be totally ignored.
In Rakesh Nemkumar Porwal v. Narayan Dhondu Joglekar the Bombay High Court held that:
"A clear reading of Section 138 leaves no doubt in our mind that the circumstances under which such a dishonour takes place are required to be totally ignored. In such case, the law only takes cognizance of the fact that the payment has not been forthcoming and it matters little that any of the manifold reasons may have caused that situation."
Requirements of the Section 138 of Negotiable Instruments Act, 1881
Section 138 creates an offence for which the mental element is not necessary. It is enough if a cheque is drawn by the accused on an account maintained by him with a banker for payment of money to another person out of the account maintained by him for the discharge in whole or in part, of any debt or other liability due. Therefore, whenever the cheques are on account of insufficiency of funds or reasons referable to the drawer’s liability to provide for funds, the provisions of section 138 of the Act would be attracted, provided the following conditions are satisfied:
1. Account Maintained
Existence of “an account" at the time of issue of cheque is a condition precedent for attracting penal liability for the offence under this section The words "that account" in the section denote to the account in respect of which the cheque was drawn. No doubt if any person manages to issue a cheque without an account with the bank concerned its consequences would not snowball into the offence described under section 138 of the Act. For the offence under section 138 of the Act there must have been an account maintained by the drawer at the time of the cheque was drawn.
S. 138 does not specifically cover the case where the payment has been stopped by the drawer or where the account has been closed prior to the endorsement of the cheque. However the Hon’ble Supreme Court has expressly held in Electronics Trade & Technology Development Corporation Ltd Case that if on issuance of the notice of dishonor by the payee or the holder in due course to the drawer, demanding payment within 15 days from the date of the receipt of such a notice, and if the drawer does not pay the due amount, the statutory presumption of dishonest intention, subject to any other liability, would stand satisfied. Whatever may be the ground or reason on the basis of which the cheque was dishonored by a bank, whether it may be “stopped payment by drawer” or “signature differ” or any other ground, if the offence under the section is made out, then the payee has the right to initiate proceedings. The court should only take into consideration whether the payment has been made by the drawer within 15 days of notice issued by the payee after the dishonour of cheque or not. A division Bench of the Madras High Court in Veeraraghvan v. Lalith Kumar stated that the endorsement account closed would mean that though the account was in operation when the cheque was issued, the subsequent act of closing of the account is prima facie referable to the “intention of the drawer not to make payment”
The court also ruled that any reason for dishonour is an offence. The reason given was that that effect is to be given to the intention of the legislature, which is evident from the language of the title to Section 138 of the Act which states “Dishonour of cheque for insufficiency, etc., of funds in the accounts”. The court observed that the addition of the word “etc.” cannot be considered to be an accident.
2. Issue of Cheque in discharge of a debt or liability
The cheque issued unpaid by the bank must have been issued in discharge of a debt or other liability wholly or in part. Where a cheque is issued not for the purposes of discharge of any debt or other liability, the maker of the cheque is not liable for prosecution under section 138 of the Act. A cheque given as a gift or for any other reasons and not for the satisfaction of any debt or other liability, partly or wholly, even if it is returned unpaid will not meet the penal consequences.
If the above conditions are fulfilled, irrespective of the mental conditions of the drawer he shall be deemed to have committed an offence, provided the other three requisites are fulfilled:
a) Presentation of the cheque within six months or within the period of its validity:
The cheque must have been presented to the bank within a period of six months from the date on which it is drawn or its period of validity, whichever is earlier. Thus if a cheque is valid for three months and is presented to the bank within a period of six months the provisions of this section shall not be attracted. However if the period of validity of the cheque is not specified or prescribed the cheque is presented within six months from the date the cause of action can arise. The six months are taken from the date the cheque was drawn.
b) Return of the cheque unpaid for reason of insufficiency of funds.
The cheque must be returned either because the money standing to the credit of that account is insufficient to honour the cheque or that it exceeds the arrangement made to be paid from that account by an agreement with the bank. Even if the cheque is returned with the endorsement "account closed" or “stop payment, Section 138 of the Act is attracted.
c) Issuance of Demand Notice:
Issue of the notice of dishonour demanding payment within thirty days of receipt of information as to dishonour of the cheque. The payee or the holder in due course of the cheque has to give a notice in writing making a demand for payment of the said amount of money to the drawer of the cheque. Such notice must be given within 30 days of information from the bank regarding the return of cheque as unpaid. If, within 15 days of the service of notice, the drawer does not make the payment, the payee can file a complaint before the jurisdictional magistrate within one month from the end of the 15th day. If the payee fails to make a complaint within the period of one month, as stated above, no proceedings can lie under s. 138 of the Act, and the only recourse available would be to initiate recovery proceedings before the competent civil court. The mode of notice is provided under Section 94 of the Negotiable Instruments Act, 1881, which states that the notice of dishonor may be given to a duly authorized agent of the person to whom it is required to be given or to the legal representatives in the event the drawer has died. Any demand made after the dishonour of cheque will constitute a notice. The notice may be oral or written and if it is written, it could be sent by post and it may be in any form/style. The essential condition to be satisfied is that that it must inform the party to whom it is given, either in express terms or by reasonable intimation that the instrument has been dishonored. If this principle is taken in practical approach, the word ‘post’ does not emphasis that it has to be a registered post or UPC. It could be sent even by fax. A courier sent and the POD of the same is sufficient discharge of the obligation of making a demand for the amount under the dishonored cheque. The medium of notice may at times even be in person or through a messenger and would constitute to be a valid notice
d) Failure of the drawer to make the payment within fifteen days of the receipt of the payment
After the receipt of the above notice the drawer of the cheque has to make payment of said amount of money to the payee or to the holder in due course of the cheque within 15 days of the receipt of the notice. If the payment is not made after the receipt of the notice within stipulated time a cause of action for initiating criminal proceedings under this section will arise.
In Sadanandan Bhadran v. Madhavan Sunil Kumar, the Supreme Court held that that on each presentation of a cheque and its subsequent dishonour, a fresh right accrues in favour of the holder but there accrues no fresh cause of action. The holder may, without taking pre-emptory action in exercise of his right under clause (b) of s. 138, can go on presenting the cheque during the validity of the cheque. A cheque should be presented within 6 months of the date of drawing, to the bank. There is no restriction as to how many times a cheque can be presented to the bank within the period of its validity. If the cheque gets dishonored, the payee has to make a demand for the payment of the said amount by giving a notice in writing to the drawer of the cheque, within 30 days of the receipt of information from the bank regarding the dishonor of the cheque.
But, once a notice under clause (b) of s. 138 of the Negotiable Instruments Act, 1881 is given, the holder is then deemed to have forfeited such right, and in the case of failure of the drawer, to pay the money within the stipulated time, the drawer would be held liable for the offence and the cause of action for filing the complaint would arise.
A criminal complaint under s. 138 of the Negotiable Instruments Act, 1881 could also be made after giving statutory notice to the signatory of the cheque. This section provides that the dishonor of a cheque for the reason of “insufficiency of funds” or for the reason that the amount covered by the cheque was not arranged for, constitutes a penal offence punishable with imprisonment for a term which may extend to two years, or with fine which may extend to twice the amount of the cheque or both.
Section 141 of the Negotiable Instruments Act, 1881 extends criminal liability for the offence of dishonour of cheques to officers of the company. Every person who, at the time the offence was committed, was in charge of and was responsible to the company for the conduct of its business, is deemed to be guilty of the offence and is liable to be proceeded against and punished.
Question of maintainability of criminal charge with a civil liability:
There is nothing in law to prevent the criminal courts from taking cognizance of the offence, merely because on the same facts, the person concerned might also be subjected to civil liability or because civil remedy is obtainable. Civil and criminal proceedings are co extensive and not exclusive. If the elements of the offence under section 138 of the Negotiable Instruments Act are made out on the face of the complaint petition itself, enforcement of the liability through a civil court will not disentitle the aggrieved person from prosecuting the offender for the offence punishable under section 138 of the Act. On dishonour of a cheque, civil and as well as criminal proceedings may be initiated. A suit for recovery of the cheque amount (including cost and interest) could be filed under the summary procedure provided in Order XXXVII of the Code of Civil Procedure, 1908.
Conclusion:
The circumstances under which a dishonour of cheque takes place or that may contribute to the situation are irrelevant and are required to be totally ignored.
In Rakesh Nemkumar Porwal v. Narayan Dhondu Joglekar, the Bombay High Court said:
“A clear reading of Section 138 leaves no doubt in our mind that the circumstances under which such a dishonour takes place are required to be totally ignored. In such case, the law only takes cognizance of the fact that the payment has not been forthcoming and it matters little that any of the manifold reasons may have caused that situation.”
When once a cheque is issued and the same is proved, a presumption under s. 139 of the Negotiable Instruments Act would arise with regard to consideration. The accused can rebutt the presumption but the burden is on him to dislodge it.
The Supreme Court in Modi Cements v. Shri Kunchil Kumar Nandi ruled that even if notice were issued stopping payment before the payee had deposited the cheque in bank, an offence under S.138 would be complete.
Though insertion of the penal provisions have helped to curtail the issue of cheque lightheartedly or in a playful manner or with a dishonest intention and the trading community now feels more secured in receiving the payment through cheques. However there being no provision for recovery of the amount covered under the dishonoured cheque, in a case where accused is convicted under section 138 and the accused has served the sentence but, unable to deposit amount of fine, the only option left with the complainant is to file civil suit. The provisions of the Act do not permit any other alternative method of realization of the amount due to the complainant on the cheque being dishonored for the reasons of "insufficient fund" in the drawer’s account. The proper course to be adopted by the complainant in such a situation should be by filing a suit before the competent civil court, for realization/ recovery of the amount due to him for the reason of dishonoured cheque, which the complainant is at liberty to avail of if so advised in accordance with law
(The author of the article can be reached at jsrobort@yahoo.com or 9810350712)
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Dealings in cheques are vital and important not only for the banking point of view but also for the commerce and industry and the economy of the country. Advent of cheques in the market have given a new dimension to the commercial and corporate world at a time when people have preferred to carry and execute a small piece of paper called cheque than carrying the currency worth the value of cheque. But pursuant to the rise in dealings with cheques also rises the malpractice of giving cheques without any intention of honoring them. Before 1988 there being no legal penal provisions to restrain people from issuing cheques without having sufficient funds in their account or any stringent provision to punish them in the vent of such cheque not being honoured by the drawer. Of course on dishonour of cheques accrues a civil liability. However in reality the processes to execute civil liability becomes notoriously dilatory and recover by way of a civil suit takes an inordinately long time. To ensure credibility of the negotiable instrument, a criminal offence was inserted in Negotiable Instruments Act, 1881 in form of the Banking, Public Financial Institutions and Negotiable Instruments Laws (Amendment) Act, 1988 which were further modified by the Negotiable Instruments (Amendment and Miscellaneous Provisions) Act, 2002
Scope
Section 138 of Negotiable Instruments Act, 1881 creates statutory offence in the matter of dishonour of cheques on the ground of insufficiency of funds etc out of the account maintained by a drawer. Section 138 of the Act creates statutory offence of the acts, which are not criminal in real sense, but are acts, which in public interest are prohibited., They are really only a summary mode of enforcing a civil right. Normally in criminal law existence of guilty intent is an essential ingredient of a crime. However the Legislature have created an offence of absolute liability or strict liability under Section 138 of Negotiable Instruments Act, 1881 where ‘mens rea’ is not at all necessary. Further the creation of the strict liability is an effective measure by encouraging greater vigilance to prevent usual callous or otherwise attitude of drawers of cheques in discharge of debts or otherwise attitude of drawers of cheques in discharge of debts or otherwise.
The circumstances under which dishonour of cheque takes place or that may contribute to the situation would be irrelevant and are required to be totally ignored.
In Rakesh Nemkumar Porwal v. Narayan Dhondu Joglekar the Bombay High Court held that:
"A clear reading of Section 138 leaves no doubt in our mind that the circumstances under which such a dishonour takes place are required to be totally ignored. In such case, the law only takes cognizance of the fact that the payment has not been forthcoming and it matters little that any of the manifold reasons may have caused that situation."
Requirements of the Section 138 of Negotiable Instruments Act, 1881
Section 138 creates an offence for which the mental element is not necessary. It is enough if a cheque is drawn by the accused on an account maintained by him with a banker for payment of money to another person out of the account maintained by him for the discharge in whole or in part, of any debt or other liability due. Therefore, whenever the cheques are on account of insufficiency of funds or reasons referable to the drawer’s liability to provide for funds, the provisions of section 138 of the Act would be attracted, provided the following conditions are satisfied:
1. Account Maintained
Existence of “an account" at the time of issue of cheque is a condition precedent for attracting penal liability for the offence under this section The words "that account" in the section denote to the account in respect of which the cheque was drawn. No doubt if any person manages to issue a cheque without an account with the bank concerned its consequences would not snowball into the offence described under section 138 of the Act. For the offence under section 138 of the Act there must have been an account maintained by the drawer at the time of the cheque was drawn.
S. 138 does not specifically cover the case where the payment has been stopped by the drawer or where the account has been closed prior to the endorsement of the cheque. However the Hon’ble Supreme Court has expressly held in Electronics Trade & Technology Development Corporation Ltd Case that if on issuance of the notice of dishonor by the payee or the holder in due course to the drawer, demanding payment within 15 days from the date of the receipt of such a notice, and if the drawer does not pay the due amount, the statutory presumption of dishonest intention, subject to any other liability, would stand satisfied. Whatever may be the ground or reason on the basis of which the cheque was dishonored by a bank, whether it may be “stopped payment by drawer” or “signature differ” or any other ground, if the offence under the section is made out, then the payee has the right to initiate proceedings. The court should only take into consideration whether the payment has been made by the drawer within 15 days of notice issued by the payee after the dishonour of cheque or not. A division Bench of the Madras High Court in Veeraraghvan v. Lalith Kumar stated that the endorsement account closed would mean that though the account was in operation when the cheque was issued, the subsequent act of closing of the account is prima facie referable to the “intention of the drawer not to make payment”
The court also ruled that any reason for dishonour is an offence. The reason given was that that effect is to be given to the intention of the legislature, which is evident from the language of the title to Section 138 of the Act which states “Dishonour of cheque for insufficiency, etc., of funds in the accounts”. The court observed that the addition of the word “etc.” cannot be considered to be an accident.
2. Issue of Cheque in discharge of a debt or liability
The cheque issued unpaid by the bank must have been issued in discharge of a debt or other liability wholly or in part. Where a cheque is issued not for the purposes of discharge of any debt or other liability, the maker of the cheque is not liable for prosecution under section 138 of the Act. A cheque given as a gift or for any other reasons and not for the satisfaction of any debt or other liability, partly or wholly, even if it is returned unpaid will not meet the penal consequences.
If the above conditions are fulfilled, irrespective of the mental conditions of the drawer he shall be deemed to have committed an offence, provided the other three requisites are fulfilled:
a) Presentation of the cheque within six months or within the period of its validity:
The cheque must have been presented to the bank within a period of six months from the date on which it is drawn or its period of validity, whichever is earlier. Thus if a cheque is valid for three months and is presented to the bank within a period of six months the provisions of this section shall not be attracted. However if the period of validity of the cheque is not specified or prescribed the cheque is presented within six months from the date the cause of action can arise. The six months are taken from the date the cheque was drawn.
b) Return of the cheque unpaid for reason of insufficiency of funds.
The cheque must be returned either because the money standing to the credit of that account is insufficient to honour the cheque or that it exceeds the arrangement made to be paid from that account by an agreement with the bank. Even if the cheque is returned with the endorsement "account closed" or “stop payment, Section 138 of the Act is attracted.
c) Issuance of Demand Notice:
Issue of the notice of dishonour demanding payment within thirty days of receipt of information as to dishonour of the cheque. The payee or the holder in due course of the cheque has to give a notice in writing making a demand for payment of the said amount of money to the drawer of the cheque. Such notice must be given within 30 days of information from the bank regarding the return of cheque as unpaid. If, within 15 days of the service of notice, the drawer does not make the payment, the payee can file a complaint before the jurisdictional magistrate within one month from the end of the 15th day. If the payee fails to make a complaint within the period of one month, as stated above, no proceedings can lie under s. 138 of the Act, and the only recourse available would be to initiate recovery proceedings before the competent civil court. The mode of notice is provided under Section 94 of the Negotiable Instruments Act, 1881, which states that the notice of dishonor may be given to a duly authorized agent of the person to whom it is required to be given or to the legal representatives in the event the drawer has died. Any demand made after the dishonour of cheque will constitute a notice. The notice may be oral or written and if it is written, it could be sent by post and it may be in any form/style. The essential condition to be satisfied is that that it must inform the party to whom it is given, either in express terms or by reasonable intimation that the instrument has been dishonored. If this principle is taken in practical approach, the word ‘post’ does not emphasis that it has to be a registered post or UPC. It could be sent even by fax. A courier sent and the POD of the same is sufficient discharge of the obligation of making a demand for the amount under the dishonored cheque. The medium of notice may at times even be in person or through a messenger and would constitute to be a valid notice
d) Failure of the drawer to make the payment within fifteen days of the receipt of the payment
After the receipt of the above notice the drawer of the cheque has to make payment of said amount of money to the payee or to the holder in due course of the cheque within 15 days of the receipt of the notice. If the payment is not made after the receipt of the notice within stipulated time a cause of action for initiating criminal proceedings under this section will arise.
In Sadanandan Bhadran v. Madhavan Sunil Kumar, the Supreme Court held that that on each presentation of a cheque and its subsequent dishonour, a fresh right accrues in favour of the holder but there accrues no fresh cause of action. The holder may, without taking pre-emptory action in exercise of his right under clause (b) of s. 138, can go on presenting the cheque during the validity of the cheque. A cheque should be presented within 6 months of the date of drawing, to the bank. There is no restriction as to how many times a cheque can be presented to the bank within the period of its validity. If the cheque gets dishonored, the payee has to make a demand for the payment of the said amount by giving a notice in writing to the drawer of the cheque, within 30 days of the receipt of information from the bank regarding the dishonor of the cheque.
But, once a notice under clause (b) of s. 138 of the Negotiable Instruments Act, 1881 is given, the holder is then deemed to have forfeited such right, and in the case of failure of the drawer, to pay the money within the stipulated time, the drawer would be held liable for the offence and the cause of action for filing the complaint would arise.
A criminal complaint under s. 138 of the Negotiable Instruments Act, 1881 could also be made after giving statutory notice to the signatory of the cheque. This section provides that the dishonor of a cheque for the reason of “insufficiency of funds” or for the reason that the amount covered by the cheque was not arranged for, constitutes a penal offence punishable with imprisonment for a term which may extend to two years, or with fine which may extend to twice the amount of the cheque or both.
Section 141 of the Negotiable Instruments Act, 1881 extends criminal liability for the offence of dishonour of cheques to officers of the company. Every person who, at the time the offence was committed, was in charge of and was responsible to the company for the conduct of its business, is deemed to be guilty of the offence and is liable to be proceeded against and punished.
Question of maintainability of criminal charge with a civil liability:
There is nothing in law to prevent the criminal courts from taking cognizance of the offence, merely because on the same facts, the person concerned might also be subjected to civil liability or because civil remedy is obtainable. Civil and criminal proceedings are co extensive and not exclusive. If the elements of the offence under section 138 of the Negotiable Instruments Act are made out on the face of the complaint petition itself, enforcement of the liability through a civil court will not disentitle the aggrieved person from prosecuting the offender for the offence punishable under section 138 of the Act. On dishonour of a cheque, civil and as well as criminal proceedings may be initiated. A suit for recovery of the cheque amount (including cost and interest) could be filed under the summary procedure provided in Order XXXVII of the Code of Civil Procedure, 1908.
Conclusion:
The circumstances under which a dishonour of cheque takes place or that may contribute to the situation are irrelevant and are required to be totally ignored.
In Rakesh Nemkumar Porwal v. Narayan Dhondu Joglekar, the Bombay High Court said:
“A clear reading of Section 138 leaves no doubt in our mind that the circumstances under which such a dishonour takes place are required to be totally ignored. In such case, the law only takes cognizance of the fact that the payment has not been forthcoming and it matters little that any of the manifold reasons may have caused that situation.”
When once a cheque is issued and the same is proved, a presumption under s. 139 of the Negotiable Instruments Act would arise with regard to consideration. The accused can rebutt the presumption but the burden is on him to dislodge it.
The Supreme Court in Modi Cements v. Shri Kunchil Kumar Nandi ruled that even if notice were issued stopping payment before the payee had deposited the cheque in bank, an offence under S.138 would be complete.
Though insertion of the penal provisions have helped to curtail the issue of cheque lightheartedly or in a playful manner or with a dishonest intention and the trading community now feels more secured in receiving the payment through cheques. However there being no provision for recovery of the amount covered under the dishonoured cheque, in a case where accused is convicted under section 138 and the accused has served the sentence but, unable to deposit amount of fine, the only option left with the complainant is to file civil suit. The provisions of the Act do not permit any other alternative method of realization of the amount due to the complainant on the cheque being dishonored for the reasons of "insufficient fund" in the drawer’s account. The proper course to be adopted by the complainant in such a situation should be by filing a suit before the competent civil court, for realization/ recovery of the amount due to him for the reason of dishonoured cheque, which the complainant is at liberty to avail of if so advised in accordance with law
(The author of the article can be reached at jsrobort@yahoo.com or 9810350712)
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Saturday, April 18, 2009
Irretrievable breakdown of marriage
Irretrievable breakdown of marriage ought to be a ground for granting divorce, the Law Commission of India has recommended, it was announced today.
The Commissions 217th Report on Irretrievable Breakdown of Marriage-Another Ground for Divorce has been forwarded by Chairman A R Lakshmanan to Law and Justice Minister Hans Raj Bhardwaj.
A Ministry statement noted that Section 13 of the Hindu Marriage Act, 1955 and Section 27 of the Special Marriage Act, 1954 each provides grounds for seeking divorce.
But neither lists irretrievable breakdown of marriage as a ground.
This is not the first time the Law Commission has commented on the subject.
In its 71st Report-- The Hindu Marriage Act, 1955: Irretrievable Breakdown of Marriage as a Ground of Divorce-- the Commission was for thus amending the Hindu Marriage Act.
Some three years ago, the Supreme Court in Naveen Kohli vs Neelu Kohli recommended to the government to seriously consider bringing such an amendment.
In the light of the Judgment, the Commission suo motu examined extant legislations and apex court and High Court judgments on the subject and advocated incorporating irretrievable breakdown of marriage as another ground for granting divorce under the two Acts.
The statement stressed that before granting a decree for divorce on that ground a Court also examine whether adequate financial arrangements have been made for the parties and children
The Commissions 217th Report on Irretrievable Breakdown of Marriage-Another Ground for Divorce has been forwarded by Chairman A R Lakshmanan to Law and Justice Minister Hans Raj Bhardwaj.
A Ministry statement noted that Section 13 of the Hindu Marriage Act, 1955 and Section 27 of the Special Marriage Act, 1954 each provides grounds for seeking divorce.
But neither lists irretrievable breakdown of marriage as a ground.
This is not the first time the Law Commission has commented on the subject.
In its 71st Report-- The Hindu Marriage Act, 1955: Irretrievable Breakdown of Marriage as a Ground of Divorce-- the Commission was for thus amending the Hindu Marriage Act.
Some three years ago, the Supreme Court in Naveen Kohli vs Neelu Kohli recommended to the government to seriously consider bringing such an amendment.
In the light of the Judgment, the Commission suo motu examined extant legislations and apex court and High Court judgments on the subject and advocated incorporating irretrievable breakdown of marriage as another ground for granting divorce under the two Acts.
The statement stressed that before granting a decree for divorce on that ground a Court also examine whether adequate financial arrangements have been made for the parties and children
Friday, April 17, 2009
Banks are not student friendly
If you still feel the education sector is insulated from recession, apply for a bank loan! Banks have taken a tough stand in the wake of the recession that has reduced placement rates at even the best institutions. In fact a public sector bank recently announced that it would give an amount equal to government fees for a professional course. The irony is that a major chunk of students depend on private or self-financing institutions for professional courses where the fees are much higher! “We are following RBI regulations as far as providing education loans are concerned and no new rules have been implemented,” said a Relationship Manager attached to the State Bank of Travancore (SBT). Public sector banks were more flexible in providing education loans before the recession. But most banks have now realised that many students, who have loans and have completed the course for which they got the money, are yet to be placed. Of course there was a time when banks vied with each other to dole out education loans. But that was in the pre-recession era. Today things have changed. “We check the repayment capacity of a student’s parent as we cannot rely solely on the placement chances of the student,” added the SBT official. “During this period of recession, no course can guarantee a job. At present banks give up to Rs. 4 lakh without security but anything more than that could warrant security being asked for. However even for a loan of up to four lakhs the co-obligation of parents is required. So there is nothing new in checking a parent's repayment ability,” said a Senior Manager of the Punjab National Bank (PNB) — a leading provider of education loans. Apart from the above, if you are a student looking for a loan, you should know that quite a few banks have stopped granting loans to students who are taking up certain diploma courses. And your chances of getting a loan if the diploma course is offered by a foreign institution are bleak. Banks have also informally admitted that courses like air hostess training, fire fighting, lift technology and retail management don’t enter the loan net. “Diploma courses should be full time and should be job-oriented, otherwise we can’t provide loans,” admitted the Manager of PNB. Your loan guide * Make sure that the institution or course is recognised * Check the institution’s credibility with the bank. You will get a placement record from other students who have taken a loan from the bank * Try to find a part-time job and save that income to repay the loan after the course * Start repaying the loan as soon as you get your first salary. * If you are not able to repay due to the lack of placement, disclose this to the bank and request for an extension of your repayment period. * Try to pay the interest even in an extreme situation
Lawyers not liable under consumer Act: SC
Bar of Indian Lawyers vs. D. K. Gandhi (Supreme Court) The State Commission, Delhi, held that services rendered by a Lawyer would not come within the ambit of s. 2(1)(o) of the Consumer Protection Act, 1986, as the client executes the power of attorney authorizing the Counsel to do certain acts on his behalf and there is no term of contract as to the liability of the lawyer in case he fails to do any such act. The State Commission held that it is a unilateral contract executed by the client giving authority to the lawyer to appear and represent the matter on his behalf without any specific assurance or undertaking. This verdict was reversed by the National Consumer Disputes Redressal Commission on the ground that lawyers are rendering a service. They are charging fees. It is not a contract of personal service and that there was no reason to hold that they are not covered by the provisions of the Consumer Protection Act, 1986. It was held that though a Lawyer may not be responsible for the favourable outcome of a case as the result/out come does not depend upon only on lawyers’ work, but, if there was deficiency in rendering services promised, for which consideration in the form of fee is received by him, then the lawyers can be proceeded against under the Consumer Protection Act. The said judgement of the NCDRC has now been stayed by the Supreme Court.
HOW TO FORM & REGISTER A PRIVATE LIMITED COMPANY - A GLANCE
A private Company can be formed either by i. incorporation of a new company for doing a new business , or ii. conversion of existing business of a sole proprietory concern or partnership firm into a company. A sole proprietory or partnership business can be converted into a company in any of the following ways: 1. By outright sale of the business as a going concern. It may be a block sale where the following takes over all the assets and liabilities of the firm or it may be partial take over of certain assets and liabilities. The consideration may be based on itemized sale or it may be on slump sale basis. 2. A company becoming a partner of the firm which will be dissolved thereafter by making partners of the firms the only shareholders of the newly incorporated company for which the following steps should be taken: (i) Form a private company as per the procedure. (ii) The proprietor of the existing business alongwith some other persons (generally, family members and friends) or the partners of the existing firms, are the subscribers to the Company Memorandum of Association (iii) Make the newly formed company a partner with the sole-proprietor or the partners of the existing business. For this purpose a fresh partnership deed is to be executed. (iv) Make a provision in the new partnership deed for the transfer of all assets and liabilities of the firm to any one of the partners who will pay off to the other partners. (v) Dissolve the partnership with the whole business going to the company as the sole continuing partner. (vi) Every other partner of the firm (or the proprietor) gets shares in the company in lieu of his interest in the firm on dissolution. PRELIMINARIES - PROMOTERS / REGISTERED OFFICE PROMOTION The promotion of a company comprises of the preliminary preparatory steps leading to its incorporation. A promoter is a person who brings about the incorporation and organization of a corporation. He brings together the persons who become interested in the enterprise, aids in procuring subscribes and sets in motion the machinery which leads to the formation itself. Who can be a Promoter? Any person who is capable of entering into a contract can be a promoter. Minor, undischarged insolvent, a non-resident without the general or special permission of the Reserve Bank of India, partnership firm, HUF and persons working in professional capacity cannot be promoter. REGISTERED OFFICE The promoters have to take an important decision as to the place of registered office of the proposed company. The name of the state has to be specified in the application for availability of name in Form 1-A and in the Memorandum also. The application in Form 1-A and other documents of registration shall then be field with the Registrar of Companies having territorial jurisdiction over that state. The exact location of the registered office should be informed to the Register in Form 18, within 30 days of incorporation of the company. NAME The name of a corporation is the symbol of its personal existence. Any suitable name may be selected subject, however, to the following instructions: i. No company can be registered with a name which in the opinion of the Central Government is undesirable. ii. The name of the company should not be identical with or should not too nearly resemble, the name of another registered company, for such name may be declared undesirable by the Central Government. iii. Whatever be the name of the company if the liability of the members is limited the last word of the name must be ‘Limited’ and in the case of a private company ‘Private Limited’ iv. Name of the Company must be printed on the outside of every place where the business of the company is carried on. Such name including the address of the registered office, must also be mentioned on all business letters and other official publications, on all negotiable instruments issued or endorsed by the company and on all other orders, receipts, etc. Application for Availability of Name • The promoters should select three to five alternative names, quite distinct from each other. • The names should suggest, as far as possible, the main objects of the proposed company. • The names should not too closely resemble with the name of any other registered company. • The official guidelines issued by the Central Government should be followed while selecting the names. Besides, the names so selected should not violate the provisions of the Emblems and Names (Prevention of Improper Use) Act, 1950. • The Deptt. Of Company Affairs has advised the ROCs to make arrangements for allowing the promoters and their representatives to ascertain the availability of proposed names. This will ensure that the names applied for would be made available promptly when an application for this purpose is made subsequently by the promoters • Apply in form 1-A to the Registrar of Companies have jurisdiction alongwith a filing fee of Rs. 500, to ascertain which of the selected names is available .The fee can be deposited in cash at the counter of the office of the Registrar or by postal order. Company to be Registered within 6 Months of Approval of the Name • After scrutiny of the application for availability of name and finding no objection to the proposed name, the Register of Companies informs the promoters to the incorporation of company by that name within 7 days of receipt of application. • The promoters should complete all other formalities for registration within 6 months from the date of approval of name by Registrar. • Various documents required for the registration of company must be filed sufficiently well before the period of six months so that the company obtains the certificate of incorporation on a date which is within 6 months of approval of name, after these documents are vetted by ROC. • If, for any reason the formalities cannot be completed, the promoters should apply for revalidation of name by filling Form 1A afresh alongwith a request letter on plain paper stating the reason together with a fee of Rs. 500 giving complete reference to the letter of the Registrar. • If none of the names suggested is available, the promoters should apply again selecting fresh names, or removing the objections raised, within a period of one month from the date of the letter. • If no action is taken within this period, on the rejection of the name, name availability application is to be made afresh alongwith a fee of Rs. 500 . The promoters may, however, make representation the Registrar’s refusal to the following authorities: List of Authorities to Whom Representation against Refusal of Name can be made with Addresses/Jurisdiction Address Jurisdiction Central Government • Secretary Department of Company Affairs, Shastri Bhawan, 5th floor,’A’ Wing, Dr. Rajendra Prasad Road New delhi-110 001 Regional Directors • Regional Director, Eastern Region Nizam Palace, II M.S.O Building, 3rd Floor, 234/4 Acharya Jagdish Chandra Bose Road ,Calcutta –700 020 • Regional Director, Northern Region, 10/499-B, Allenganj ,Khalasi Line, Kanpur-208 001 • Regional Director, Southern Region, 5th floor, Shastri Bhawan, 26, Haddows Road Chennai- 600 006 • Regional Director, Western Region, “Everest”, 5th floor, 100, Netaji Subhash Road Mumbai – 400 002 Overall West Bengal, Orissa, Bihar, Assam, Tripura, Manipur, Nagaland, Mizoram, Arunachal Pradesh. Delhi, Haryana, Uttar Pradesh, Punjab, Himachal Pradesh,,Chandigarh,Rajasthan, Jammu & Kashmir Tamil Nadu, Andhra Pradesh, Karnataka, Kerala, Pondicherry Maharashtra, Gujarat, Goa, Daman & Diu, DOCUMENTS REQUIRED FOR INCORPORATION After obtaining Registrar’s approval for the company’s name, the promoters should prepare the following documents, in the prescribed manner and form: i. Memorandum of Association ii. Articles of Association iii. Prospectus /Statement in lieu of prospectus is not requires in case of a private company iv. Copy of import agreements. v. Statutory declaration in Form I vi. Copy of Letter of Register indicating approval of name. vii. Power of Attorney. viii. Notice of situation of registered office (in Form 18) and particulars of Directors (in Form 32). These two forms can be field either at the time of incorporation or within 30 days form the date of incorporation. • The documents should be duly executed signed and stamped from the date of approval of name by the Registrar. • It is to be ensured that subscribers to the Memorandum and Articles of Association of the proposed company are same as the promoters whose names are appearing in the application for availability of name. In the case of a change, the changed subscribers will be asked to make a fresh application for availability of name. The ROC may allow the same name, if available after six month from the date when the name was allowed to the original promoter. REGISTRATION OF COMPANY AND ISSUE OF CAPITAL Registering Authorities The list of the offices of the Registrar of the Companies is given below Documents of Registration After completion of the preliminaries as enumerated, the following documents are required to be filed with the Registrar of Companies of the State in which the company is proposed to be incorporated. (1) Memorandum of Association (duly stamped) and a duplicate thereof. (2) Articles of Association (duly stamped) and a duplicate thereof (3) The agreement, if any, which the company proposes to enter into with any individual for appointments as its managing or whole time director or manager. (4) A copy of the agreement, if any, referred to in the articles (5) A power of Attorney, if any (with prescribed stamps) (6) A copy of the letter of the Registrar of Companies intimating the availability of the proper name (7) Form No.1 (with prescribed stamps) (8) Form No.18, if desired (9) Form No. 32 (in duplicate), if desired (10) Documents evidencing payment of prescribed registration and filing fee, i.e. a bank draft or a treasury challan. (11) The promoters, as being the subscribers to the Memorandum and Articles should be the same person whose names are appearing in the original application for availability of name (Form 1A). If the names have changed, ROC will not register the company until and unless, the name is got re-validated with the new subscribers as applicants, by paying another fee of Rs. 500. Registration fee • The amount of registration fee payable is regulated with reference to the amount of authorized capital of the proposed company. • The maximum registration fee is Rs. 2,00,04,000. • The fee for registration of companies has been revised w.e.f 1.5.2000.The registration fee for a company will be as prevailing on the date of its actual registration and accordingly, the revised fee affective from 1.5.2000 will be applicable in respect of the companies registered on or after that date. • If the authorized capital is increased subsequently, the company shall be liable to pay additional registration fee, i.e. the difference between the registration fee payable on the increased authorized capital (subject to the maximum limit of Rs. 2,00,04,000) and the fee already paid. REGISTRATION FEE PAYABLE TO REGISTRAR OFCOMPANIES BY COMPANY HAVING SHARE CAPITAL Authorised Capital Registration Fee on Memorandum of Associaion Rs. Authorised Capital Registration Fee on Memorandum of Associaion Rs. 1,00,000 4,000 1,50,000 5,500 2,00,000 7,000 2,50,000 8,500 3,00,000 10,000 3,50,000 11,500 4,00,000 13,000 4,50,000 14,500 5,00,000 16,000 5,50,000 17,000 6,00,000 18,000 6,50,000 19,000 7,00,000 20,000 7,50,000 21,000 8,00,000 22,000 8,50,000 23,000 9,00,000 24,000 9,50,000 25,000 10,00,000 26,000 15,00,000 36,000 20,00,000 46,000 25,00,000 56,000 30,00,000 66,000 35,00,000 76,000 40,00,000 86,000 45,00,000 96,000 50,00,000 1,06,000 55,00,000 1,11,000 60,00,000 1,16,000 65,00,000 1,21,000 70,00,000 1,26,000 75,00,000 1,31,000 80,00,000 1,36,000 85,00,000 1,41,000 90,00,000 1,46,000 95,00,000 1,51,000 1,00,00,000 1,56,000 1,50,00,000 1,81,000 2,00,00,000 2,06,000 250,00,000 2,31,000 3,00,00,000 2,56,000 3,50,00,000 2,81,000 4,00,00,000 3,06,000 4,50,00,000 3,31,000 5,00,00,000 3,56,000 6,00,00,000 4,06,000 7,00,00,000 4,56,000 8,00,00,000 5,06,000 9,00,00,000 5.56,000 10,00,00,000 6,06,000 The above fee is calculated as per following Schedule: Authorised Capital Fee Payable Upto Rs.1,00,000 Between Rs. 1,00,001 to Rs. 5,00,000 Between Rs. 5,00,001 to Rs. 50,00,000 Between Rs. 50,00,001 to 1 crore Above Rs. 1 Crore Rs. 4,000 Rs. 4,000 plus Rs 300 for every Rs. 10,000 or part after first Rs. 1,00,000 upto Rs. 5,00,000 Rs. 16,000 plus Rs. 200 for every Rs.10,000 or part after first Rs. 5,00,000 upto Rs. 50,00,000 Rs. 1,06,000 plus Rs. 100 for every Rs. 10,000 or part after first Rs. 50,00,000 upto Rs. 1 crore Rs. 1,56,000 plus Rs. 50 for every Rs. 10,000 or part after first Rs. 1 crore Note: Maximum fee is Rs. 2,00,04,000 Processing of Documents • If the Registrar is satisfied that all the requirements have been complied with by the company, as per the Companies Act and the Rules framed thereunder; documents bear proper stamp duty and the conditions imposed by any other law for the time being in force, are also fulfilled, the Registrar will register the company. • If any defect is found by the Registrar of Companies in the documents the same will have to be rectified by the applicant and authenticated by the signature (s) of a person authorized to de so. • A form or documents would be defective for any one of the following reason , viz. d. The form or documents does not contain the necessary enclosures; e. The documents is not properly signed or certified; f. Certain particulars have not bee filled up; g. Certain particulars are apparently believed to be false; h. Not accompanied by the requisite filing fee; i. Not filed in proper time. Improper refusal by Registrar • The Registrar cannot refuse registration of a company if all the condition for Registration of the company as prescribed by Section 33 of the Act are complied with. • If the registrar improperly refuses to register a company a writ of mandamus may be filed in the Court Law. Certificate of Incorporation • When the registrar decides to register a company it issues a Certificate of Incorporation of Company which is conclusive evidence as regards the compliance with the requirements of the Act in regards to registration of company and the matter precedent or incidental thereto. • The date mentioned in this certificate of incorporation is the date of incorporation of the company. • It brings the company into existence as a legal person. ISSUE OF SHARE CAPITAL After obtaining registration, the company proceeds with its business for which it requires funds. A private company cannot raise funds from the public; the capital is to be raised by way of private arrangements viz. from among the family members, relatives and friends, But first of all the company will issue shares to the subscribers to its memorandum and other members of the company. The issued capital must not exceed the authorized capital of the company. If a company wants to issue capital more than its authorized capital, it has to first raise, its authorized capital by passing a special/ordinary resolution (as prescribed in the Articles) and applying in Form No. 5-alongwith additional registration fee, before the ROC. Types ofShares A company may issue following types of Shares- a. Equity shares b. Preference shares According to Section 90(2), a private company which is not a subsidiary of a public company may issue shares of such other kind as it may think fit. Similarly a private company shall be free to issue shares with disproportionate voting rights
In-house Lawyer
In-house Lawyer
The challenge for growing business lies in finding a lawyer who have comprehensive understanding of and interest in your business. Regardless of the size of your business, the legal issues that you will confront are complex. They might not occur as frequently but they are no less significant. The benefits of in-house lawyer are apparent. They have an inherently greater understanding and circumspection of your business. Moreover, lawyer with in-house backgrounds understand that legal advice and solutions must fit within a unique and complex matrix of your operational, financial, historical, service and cultural considerations.
The challenge for growing business lies in finding a lawyer who have comprehensive understanding of and interest in your business. Regardless of the size of your business, the legal issues that you will confront are complex. They might not occur as frequently but they are no less significant. The benefits of in-house lawyer are apparent. They have an inherently greater understanding and circumspection of your business. Moreover, lawyer with in-house backgrounds understand that legal advice and solutions must fit within a unique and complex matrix of your operational, financial, historical, service and cultural considerations.
LITIGATION MANAGEMENT
LITIGATION MANAGEMENT
The goal is to control the entire litigation process from inception to resolution, drawing on the expertise of our lawyers. Working as a team, we quickly determine which case should be developed for trial and which case can be positioned for early and cost-effective resolution. We then perform only the legal work that will have an impact on achieving the best results and savings. Each case is handled on an individual basis, taking into account the client’s objective, the type of claim and the specific of the file.
To ensure that the litigants receive consistent, high-quality representation in various courts of law in India, the Litigation Management includes the reporting of the exact status of the case in the court and the actions taken by the lawyers and the steps as required under the procedure laws. The objective of the Litigation Management is to update the litigants about all possible legal steps as required under the law so that they can not be taken on surprise by the court as the negligence of a lawyer can not be an excuse under the law.
The goal is to control the entire litigation process from inception to resolution, drawing on the expertise of our lawyers. Working as a team, we quickly determine which case should be developed for trial and which case can be positioned for early and cost-effective resolution. We then perform only the legal work that will have an impact on achieving the best results and savings. Each case is handled on an individual basis, taking into account the client’s objective, the type of claim and the specific of the file.
To ensure that the litigants receive consistent, high-quality representation in various courts of law in India, the Litigation Management includes the reporting of the exact status of the case in the court and the actions taken by the lawyers and the steps as required under the procedure laws. The objective of the Litigation Management is to update the litigants about all possible legal steps as required under the law so that they can not be taken on surprise by the court as the negligence of a lawyer can not be an excuse under the law.
Legal Audit
Legal Audit
Legal Audit is a new service devised by Lawise India integrating the works of a group of professional to give you a rapid and objective diagnosis, thus enable you to:
*
Obtain an overview of the company from a legal perspective.
*
Detect any potential risk situations in the day to day affairs of the company
*
Make timely decisions with respect to any necessary preventive or corrective legal measures
(A). CORPORATE ISSUES :-
The LEGAL AUDIT empowers you to deal with debt financing and refinancing processes, tax reviews and external audit processes, as well as the implementation of growth plans, mergers, capitalization, asset sales and the many other management decisions which demand an accurate knowledge of the status of the corporate and financial structure of the relevant company
The most significant aspects examined by the LEGAL AUDIT are:
A. Articles of Incorporation/Bylaws and Amendments
1. Capital Stock.
2. Shareholder Meetings (last 5 years).
3. Administration.
4. Statutory Auditors.
B. Legal Books:
1. Minutes of Shareholder Meetings
2. Minutes of Directors Board Meetings
5. Register of Stocks and Shares
(B). CONTRACT ISSUES
Our LEGAL AUDIT allows you to put in place a sound risk prevention policy to significantly improve your business. Lawise India will review and analyze the contracts deemed most important for the company (up to fifteen) in order to determine the existence of legal contingencies and tax or other implications. Such contracts include:
A. Financing Contracts
B. Technical Assistance Contracts
C. Supply Contracts
D. Distribution Contracts
E. Franchise Contracts
F. . Guarantees
(C). LABOR ISSUES
Remuneration of company personnel and corporate responsibility for social security give rise to many concerns and potential problems against the background of the new regulations and standards governing labor relations in Venezuela. Our LEGAL AUDIT enables you to obtain an general overview of the labor status of a company through our study of:
A. Individual Employment Contracts;
B. Collective Bargaining Agreements;
C. Internal Rules for Working Conditions and Social Security (Internal Regulations, Personnel Policies, etc.);
D. Law suits and Claims brought with the Office of the Labor Inspector;
(D). TAX ISSUES
In the current tax scenario, it is essential, in order to ensure the stability of a company, to minimize the risk of any action on the part of the Administration. Our LEGAL AUDIT determines company compliance with its formal duties in matters of Taxation in the following key areas:
A. National Taxes
1. Income Tax
2. Custom & Excise Tax
3. Service Tax
B. State Taxes
1. Sale Tax
2. Entertainment Tax
C. Municipal Tax
1. Property Tax
2. Professional Tax
FEES :-
The LEGAL AUDIT is performed by a team of professionals, over the course of one day of intensive, focused work at your company, and up to six days at our offices, where the audit is analyzed, a diagnosis is reached and the report is drafted under the coordination and direction of one of our partners.
For the launch of this new service, the fees for our LEGAL AUDIT will be such agreed amount as should have no impact on your company’s planned expenses and which will return substantial savings for the company by anticipating possible risk situations.
For the efficiency and success of our LEGAL AUDIT we just ask that you provide us with:
• the relevant documents and contracts, duly selected and organized;
• a suitable working area to conduct the part of our work to be done at your offices;
• a contact person to provide feedback.
A CUSTOMIZED SERVICE
Our LEGAL AUDIT is a service tailored to the needs of your company, and will vary according to the economic sector in which the majority of your commercial activity takes place. This allows the service to be customized as necessary to include specific supplementary issues, such as:
• Consumer Protection
• Customs
• Environment
• Equity Planning
• Finance
• Franchising
• Intellectual Property, including Industrial Property, Design Rights, Trademarks and Copyrights.
• International Trade (Antitrust, Competition, Antidumping).
Should it be necessary to involve highly specialized professionals for a customized LEGAL AUDIT service including supplementary issues, we would reach a separate agreement covering the fees for such specific issues.
Legal Audit is a new service devised by Lawise India integrating the works of a group of professional to give you a rapid and objective diagnosis, thus enable you to:
*
Obtain an overview of the company from a legal perspective.
*
Detect any potential risk situations in the day to day affairs of the company
*
Make timely decisions with respect to any necessary preventive or corrective legal measures
(A). CORPORATE ISSUES :-
The LEGAL AUDIT empowers you to deal with debt financing and refinancing processes, tax reviews and external audit processes, as well as the implementation of growth plans, mergers, capitalization, asset sales and the many other management decisions which demand an accurate knowledge of the status of the corporate and financial structure of the relevant company
The most significant aspects examined by the LEGAL AUDIT are:
A. Articles of Incorporation/Bylaws and Amendments
1. Capital Stock.
2. Shareholder Meetings (last 5 years).
3. Administration.
4. Statutory Auditors.
B. Legal Books:
1. Minutes of Shareholder Meetings
2. Minutes of Directors Board Meetings
5. Register of Stocks and Shares
(B). CONTRACT ISSUES
Our LEGAL AUDIT allows you to put in place a sound risk prevention policy to significantly improve your business. Lawise India will review and analyze the contracts deemed most important for the company (up to fifteen) in order to determine the existence of legal contingencies and tax or other implications. Such contracts include:
A. Financing Contracts
B. Technical Assistance Contracts
C. Supply Contracts
D. Distribution Contracts
E. Franchise Contracts
F. . Guarantees
(C). LABOR ISSUES
Remuneration of company personnel and corporate responsibility for social security give rise to many concerns and potential problems against the background of the new regulations and standards governing labor relations in Venezuela. Our LEGAL AUDIT enables you to obtain an general overview of the labor status of a company through our study of:
A. Individual Employment Contracts;
B. Collective Bargaining Agreements;
C. Internal Rules for Working Conditions and Social Security (Internal Regulations, Personnel Policies, etc.);
D. Law suits and Claims brought with the Office of the Labor Inspector;
(D). TAX ISSUES
In the current tax scenario, it is essential, in order to ensure the stability of a company, to minimize the risk of any action on the part of the Administration. Our LEGAL AUDIT determines company compliance with its formal duties in matters of Taxation in the following key areas:
A. National Taxes
1. Income Tax
2. Custom & Excise Tax
3. Service Tax
B. State Taxes
1. Sale Tax
2. Entertainment Tax
C. Municipal Tax
1. Property Tax
2. Professional Tax
FEES :-
The LEGAL AUDIT is performed by a team of professionals, over the course of one day of intensive, focused work at your company, and up to six days at our offices, where the audit is analyzed, a diagnosis is reached and the report is drafted under the coordination and direction of one of our partners.
For the launch of this new service, the fees for our LEGAL AUDIT will be such agreed amount as should have no impact on your company’s planned expenses and which will return substantial savings for the company by anticipating possible risk situations.
For the efficiency and success of our LEGAL AUDIT we just ask that you provide us with:
• the relevant documents and contracts, duly selected and organized;
• a suitable working area to conduct the part of our work to be done at your offices;
• a contact person to provide feedback.
A CUSTOMIZED SERVICE
Our LEGAL AUDIT is a service tailored to the needs of your company, and will vary according to the economic sector in which the majority of your commercial activity takes place. This allows the service to be customized as necessary to include specific supplementary issues, such as:
• Consumer Protection
• Customs
• Environment
• Equity Planning
• Finance
• Franchising
• Intellectual Property, including Industrial Property, Design Rights, Trademarks and Copyrights.
• International Trade (Antitrust, Competition, Antidumping).
Should it be necessary to involve highly specialized professionals for a customized LEGAL AUDIT service including supplementary issues, we would reach a separate agreement covering the fees for such specific issues.
Alternative Dispute Resolution Mechanism
Alternative Dispute Resolution Mechanism
Alternative Dispute Resolution Mechanism is one of the quasi-judicial methods where the parties settle their dispute through informal cooperative legal proceedings. There is neither a court room nor judges but only the persons chosen by you. The decision made by the persons of your choice shall be binding upon the other parties. There is a legal sanctity to the decision and you can enforce it through the coercive power of the court. In comparison to the court fees and other legal expenses, the total cost involve in the arbitration proceedings is normal and easily bearable and that to the unlimited amount involve. You can fix the time for the settlement of your dispute. The arbitration proceedings are conducted as per the rules recognized by the law of land
Alternative Dispute Resolution Mechanism is one of the quasi-judicial methods where the parties settle their dispute through informal cooperative legal proceedings. There is neither a court room nor judges but only the persons chosen by you. The decision made by the persons of your choice shall be binding upon the other parties. There is a legal sanctity to the decision and you can enforce it through the coercive power of the court. In comparison to the court fees and other legal expenses, the total cost involve in the arbitration proceedings is normal and easily bearable and that to the unlimited amount involve. You can fix the time for the settlement of your dispute. The arbitration proceedings are conducted as per the rules recognized by the law of land
Matrimonial Disputes: Divorce Litigation
Matrimonial Disputes: Divorce Litigation
Divorce can be one of the most difficult and emotional decisions you will ever make.
It can be an emotional and stressful process. There are many important issues that have to be resolved, including property valuation, custody and visitation of children, maintenance, and child support. The idea of going through a long and complicated legal process can seem overwhelming. We can help you to understand the basic issues of family law, and give you straight answers to your questions. We are experienced in the legal aspects of divorce and can give you the advice you need to make reasonable decisions. We support our clients by representing their interest and by making sure they know we are always there for them.
If your partner has sued you in a divorce, it is important that you have separate legal representation. We in giving you advice, as well as handling all of the financial and property issues.
We divorce handle everything from straightforward divorces to complex marital dissolutions.
We can help with restraining orders and domestic violence cases.
We also handle restraining orders on behalf of domestic violence victims in domestic violence cases.
We encourage the use of confidential mediation in matrimonial disputes. While divorce always has disagreements, they can often be worked out in a non-confrontational manner without the stress of litigation.
We prefer to mediate their divorce settlement in a less confrontational manner. Divorce can exact an emotional toll on individuals and families. We have represented and helped many clients reach agreements that meet their needs. We can often help you find solutions in a less adversarial manner than traditional legal processes.
Divorce can be costly and time-consuming. Divorce mediation law can resolve disputes before they reach the stage of litigation and trial. The process of divorce mediation (sometimes referred to as family mediation) is a less time-intensive and more inexpensive alternative to traditional divorce settlement or litigation. The rules of court proceedings are relaxed and the process is less formal.
Mediation offers solutions in divorce settlement cases in India. An objective third-party mediator helps negotiate mutually acceptable solutions to all issues surrounding the clients' dissolution of marriage, including spousal support, child support, child custody, visitation and distribution of assets and liabilities.
We also handle prenuptial, post-nuptial, and legal separation agreements.
Our goal is to assist you in achieving a satisfactory outcome. A mutually agreed settlement often helps preserve relationships after the divorce is finalized, which is not only in the interest of our clients, but their families and children as well.
Divorce can be one of the most difficult and emotional decisions you will ever make.
It can be an emotional and stressful process. There are many important issues that have to be resolved, including property valuation, custody and visitation of children, maintenance, and child support. The idea of going through a long and complicated legal process can seem overwhelming. We can help you to understand the basic issues of family law, and give you straight answers to your questions. We are experienced in the legal aspects of divorce and can give you the advice you need to make reasonable decisions. We support our clients by representing their interest and by making sure they know we are always there for them.
If your partner has sued you in a divorce, it is important that you have separate legal representation. We in giving you advice, as well as handling all of the financial and property issues.
We divorce handle everything from straightforward divorces to complex marital dissolutions.
We can help with restraining orders and domestic violence cases.
We also handle restraining orders on behalf of domestic violence victims in domestic violence cases.
We encourage the use of confidential mediation in matrimonial disputes. While divorce always has disagreements, they can often be worked out in a non-confrontational manner without the stress of litigation.
We prefer to mediate their divorce settlement in a less confrontational manner. Divorce can exact an emotional toll on individuals and families. We have represented and helped many clients reach agreements that meet their needs. We can often help you find solutions in a less adversarial manner than traditional legal processes.
Divorce can be costly and time-consuming. Divorce mediation law can resolve disputes before they reach the stage of litigation and trial. The process of divorce mediation (sometimes referred to as family mediation) is a less time-intensive and more inexpensive alternative to traditional divorce settlement or litigation. The rules of court proceedings are relaxed and the process is less formal.
Mediation offers solutions in divorce settlement cases in India. An objective third-party mediator helps negotiate mutually acceptable solutions to all issues surrounding the clients' dissolution of marriage, including spousal support, child support, child custody, visitation and distribution of assets and liabilities.
We also handle prenuptial, post-nuptial, and legal separation agreements.
Our goal is to assist you in achieving a satisfactory outcome. A mutually agreed settlement often helps preserve relationships after the divorce is finalized, which is not only in the interest of our clients, but their families and children as well.
Saturday, April 11, 2009
Matrimonal Conunselling
Dear,
I am a practising lawyer dealing with matrimoinal cases for last 17 years and i am the firm opinon that the divorce is due to lack of proper counselling and communcation gap
I am a practising lawyer dealing with matrimoinal cases for last 17 years and i am the firm opinon that the divorce is due to lack of proper counselling and communcation gap
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