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In This Issue [No.165] July 30, 2006 Supreme Court High Courts PIB RBI SEBI International Cases & News Site Links Roundup Archives Free Trial Contact us To keep you informed about the latest Legislative and Regulatory information manupatra.com publishes this e-roundup highlighting the recent changes brought about by the Notifications/Acts/Bills /Ordinances etc. About manupatra.com http://www.manupatra.com/ provides comprehensive and easy to use legal and related information over the Internet .Our database covers Central Laws , Judgments of Supreme Court and High Court (full text of the judgments from 1950 onwards ), Orders of Tribunals , Bills , Notifications, Circulars and more Key features of manupatra are Content is derived from reliable primary and secondary sources Database is updated on a daily basis Electronic Ready Reckoner to view the judgments under a particular section of an Act / Subject Powerful search engine with user friendly interfaces Search in any one court/year or multiple courts/year Hyper-linking of documents Updated modules on WTO, Anti Dumping, Arbitration, Investment Destinations Abroad, Capital Markets, Taxation, Environment, Cyber & IT Laws, IPR, Corporate Laws, Industrial Policies, Foreign Trade, Forex & Banking and more     For subscription to manupatra.com or for more details please log onto http://www.manupatra.com/ or call us at 0120 2531811 or send an email to : contact@manupatra.com If at any stage you wish to stop receiving the e-roundup please click here to unsubscribe.   Seminar on Merger & Acquisition  The Bridge to the Integration of Global Economy 9th September 2006 ****Register Now**** Supreme Court Om Prakash Srivastava Vs Union of India (UOI) and Anr. Appellant filed a Writ Petition before the Delhi High Court alleging that he was being tried in several cases contrary to the extradition decree. Appellant was extradited from Singapore and was facing trial in eight cases which he alleged is in complete violation of Section 21 of the Extradition Act. He pleaded that he was being kept in solitary confinement without proper medical aid in UP Central Jail. The writ petition was dismissed by the Delhi High Court on the ground that the Allahabad High Court would also have jurisdiction to deal with grievances of the writ petitioner and can deal with conditions of prisoners in that State more effectively, though the Delhi High Court may have jurisdiction. Hence the present appeal was filed by the appellant questioning the legality of the decision of the Delhi High Court. The petitioner contended that merely because he had a choice of going before the Allahabad High Court, the Delhi High Court should not have refused to consider the writ petition. It is submitted that the basic grievance of the appellant related to alleged violation of section 21 of Extradition Act. The respondent on the other hand contended that there is no violation of any term and that no part of the cause of action had arisen in Delhi. Hence, the Delhi High Court has rightly observed that the appellant can pursue his remedy if any before the Allahabad High Court. Held, it was open to the Delhi High Court to say that no part of the cause of action arose within the territorial jurisdiction of the Delhi High Court. The High Court in the impugned order does not say so. On the contrary, it says that jurisdiction may be there, but the Allahabad High Court can deal with the matter more effectively. That is not certainly a correct way to deal with the writ petition. Accordingly, the impugned order of the High Court is set aside and matter remitted for fresh hearing on merits. Priya Patel Vs. State of M.P. and Anr A complaint was lodged by the prosecutrix alleging that the husband of the accused- appellant committed rape on her. When the commission of rape was going on, the present appellant reached there, but instead of saving the prosecutrix, the appellant slapped her, closed the door of the house and left the place of incident. On the basis of the complaint lodged, accused, husband of the appellant was charged for offence of rape and the appellant was charged for aiding the commission of rape. The revision filed before the High Court questioned the legality of the charge framed against the appellant. The High Court ruled that a woman cannot be charged for commission of offence of rape but if a woman facilitates the act of rape, explanation-I to Section 376(2) comes into operation and she can be prosecuted for "gang rape". The appellant contended that the High Court clearly missed the essence of Sections 375 and 376 IPC. It was submitted that as a woman cannot commit rape, she cannot certainly be convicted for commission of "gang rape". The prosecution submitted that even if for the sake of argument it is conceded that the appellant cannot be prosecuted for commission of offence punishable under Section 376(2)(g), she can certainly be prosecuted for commission of the offence of abetment. Held, a woman cannot be said to have an intention to commit rape. Therefore, the counsel for the appellant is right in submitting that the appellant cannot be prosecuted for alleged commission of the offence punishable under Section 376(2)(g). Jyothi Ademma Vs.Plant Engineer, Nellore and Anr The case pertained to the death of the appellant’s husband who while working with Nellore Thermal Station, died of heart attack at his workplace. The appellant filed an application before the Commissioner for Workman’s Compensation claiming a compensation of 1 lac stating that the death was due to stress and strain closely linked with the employment of the deceased workman and, therefore, attributable to an accident arising out of and in the course of employment. The Commissioner made an award in her favour, against which the respondent filed an appeal. The main contention of the respondent was that the deceased workman did not die on account of any injury sustained by him "in any accident arising out of and in the course of his employment". The High Court ruled in favour of the respondents. Aggrieved by the said order an appeal was filed before the Supreme Court. Held, it has been brought on record that the deceased was suffering from chest disease and was previously treated for such disease. Also, the job of the deceased was only to switch on or off the machines and doctors had opined that there was no scope for any stress or strain in his duties. Therefore, the appellant is not entitled to any compensation under the Workmen’s Compensation Act. Manjula Vs. K.R. Mahesh The petitioner and the respondent entered into wedlock and a daughter was born. Thereafter, due to the strained  marital relation, a divorce petition was filed. On the basis of a prayer for maintenance, the Family Court granted maintenance at the rate of Rs. 1500/- per month. The respondent agreed to pay a sum of rupees seven lakhs so that part of it can be spent for the education of the daughter and balance money can be spent towards marriage expenses when she reaches marriageable age. Petitioner stated that the amount offered by the respondent is low and contended that more money has to be deposited by the respondent for the welfare of the daughter. Court held that since marriage has irretrievably broken down there was no point in making an effort to bring about conciliation between the parties. Hence, the suit for divorce filed by the respondent in the Family Court to be treated as joint petition for divorce, on the basis of mutual consent, and appropriate decree to be passed. The court directed the respondent to deposit Rs.8.6 lakh in daughter’s name in two separate schemes for securing the future education and upbringing of the child. It also directed the respondent to file an undertaking before the concerned Trial Court that in case there is a shortfall in the assured sum, the respondent shall pay the balance amount to the petitioner. High Courts Delhi Govt. School Teachers Association (Regd.) Vs. University of Delhi and Ors. The writ petitions were filed challenging the policy of the respondents of giving preference for the purposes of admission in educational courses to persons who have cleared the 10+2 examinations from schools located in the National Capital Territory of Delhi (NCT of Delhi). The eligibility criteria were that candidates should have passed 12th Class examination under 10+2 system conducted by CBSE and further every candidate must have studied 11th and 12th regularly from recognized school with NCT. Dismissing the writ petitions, the High Court held that the respondents should consider the advisability of extending residency requirements of students from the 10th class onwards, so that the genuine students could be separated from those joining schools in Delhi only to avail the 85 per cent reservation. Patna Md. Gazi and Ors. v. The State of Bihar and Anr. The present application under Section 482 of the Code of Criminal procedure was sought to quash the criminal proceedings initiated against the petitioners under Sections 376, 120(B) of the Indian Penal Code. The petitioner contended that the allegations were false and that the order of cognizance issued by magistrate under Section 204 was bad in law and therefore, was fit to be quashed under the inherent jurisdiction of this Court. The High Court stated that for deciding the question whether the criminal proceeding was fit to be quashed or not under Section 482, the case has to be seen purely from the point of view of the complaint without adverting to any defence that the accused may have. It was further held that the scope of enquiry under Section 202 has to be limited only to the ascertainment of the truth or falsehood of the allegations made in the complaint. The enquiry should be based on (i) on the materials placed by the complainant before the court; (ii) for the limited purpose of finding out whether a prima facie case for issue of process has been made out; and (iii) for deciding the question purely from the point of view of the complainant without at all adverting to any defence that the accused may have. If Magistrate found that a prima facie case for alleged offence was made out against accused persons named in the complaint petition and if there was sufficient material for proceeding against the accused persons, issuance of processes under Section 204 Cr.P.C. would be justified. In the present case since prima facie case for offence under Sections 376, 120(B) was made out against accused persons named in the complaint petition and there was sufficient material for proceeding against the accused persons, the issuance of process under Section 204 was justified. Md. Sattar v. State of Bihar and Ors. The petitioner under the writ proceedings has sought for quashing of the proceedings initiated before Certificate Officer for the recovery of the amounts of pension (Rs. 1,68,786/) and medical allowance (Rs. 16,301.60/-) fraudulently received by him under the Freedom Fighters' Pension scheme. As per the enquiry initiated under a judicial order to curb the rampant abuse of the Freedom Fighters' Pension Scheme it was found that the petitioner was getting freedom fighters' pension and other facilities even though there were no records concerning them at the state level. The High Court held that there was no record to show that the petitioners were entitled to get pension and that the certificate proceedings could be initiated to recover public money obtained fraudulently under the pension scheme. It was further held that the remedy by way of writ could not be claimed as matter of right unless it involved infringement of a fundamental right and that the statutory remedy if available has to be availed before invoking the writ jurisdiction under Article 226. The petitioner could have availed the statutory remedy under Section 9 of Bihar Public Demands Recovery Act to raise objections before the certificate officer. For the aforementioned reasons the petition was dismissed. Press Information Bureau Amendments in the Wild Life (Protection) Amendment Bill, 2005 PIB dated 20.07.2006: The Union Cabinet has given its approval for incorporating further Amendments to the Wild Life (Protection) Amendment Bill, 2005, pending in Rajya Sabha. The enactment of the Bill with amendments is intended to facilitate implementation of the urgent recommendations of the Tiger Task Force. It is aimed to strengthen the conservation of tigers and other endangered species of wild animals through effective combating of wild life crimes by constituting the Tiger and Other Endangered Species Crime Control Bureau. Non-Availability of Deduction from Income due to Abolition of Section 80L by Finance Act, 2005 PIB dated 25.07.2006: Section 80L of the Income Tax Act has been abolished by Finance Act, 2005 and is applicable from assessment year 2006-07. The provisions of section 80 L provided for deduction of Rs.12,000/- on income by way of interest arising on bank deposits, National Savings Certificates, Bonds, Debentures of Public Sector Company, etc. and additional deduction of Rs.3000/- on interest on Government securities. As a result, interest income from these savings instruments arising in the financial year 2005-06 is liable to tax even if the amount is below Rs.12,000/-. The taxpayers are asked to ensure that such income is taken into account while filing the return of income for assessment year 2006-07, default of which may result in levy of interest or penalty. RBI DBS Frauds – Classification and Reporting Circular No. DBS.FrMC.BC.No.6/23.04.001/2006-07 Dated 25.07.2006: Amendments to RBI Master Circular on Frauds –Classification and Reporting have been made vide the above circular. RBI details a reporting system for frauds to be followed by banks through the circular. It is notified that Banks are to streamline the reporting system suitably so that frauds are reported without any delay. This requisite has to be strictly adhered to by the banks and non adherence may invite penal action under Section 47 (A) of the Banking Regulation Act, 1949. Banks are required to send the returns and data, as prescribed to RBI Central Office as well as the concerned Regional Office of the Department of Banking Supervision under whose jurisdiction the bank's Head Office is situated. Cases of 'negligence and cash shortages' and ‘irregularities in foreign exchange transactions’ are to be reported as fraud if the intention to cheat/defraud is suspected/ proved. Cases of cash shortage involving more than Rs 1000/- and those detected by management / inspecting officer, irrespective of the amount, may be reported as fraud. To ensure uniformity and to avoid duplication, frauds involving forged instruments may be reported only by the paying banker and not by the collecting banker. SEBI SMD Mandatory requirement of Permanent Account Number (PAN) – Issues and clarifications Circular No: MRD/DoP/Dep/Cir-09/06 Date: 20.07.2006: The Securities Exchange Bureau of India vide the above circular notifies that it has been decided to make certain concessions as regards the mandatory requirement of Permanent Account Number (PAN). All entities registered with SEBI under Section 12 of the SEBI Act, 1992 and having some difficulty in producing PAN card for verification at the time of opening the Beneficiary Owner (BO) account may be permitted to open a BO account without producing the PAN card provided such entities submit the PAN card to the Depository Participants (DPs) within a period of 30 days from the date of opening of the BO account for verification, failing which the DPs shall freeze such accounts as “Suspended for Debit” till such time the PAN card is produced for verification. As regards proof of address of FIIs/sub-accounts, a copy of the Power of Attorney (POA) given by the FIIs/FII sub-accounts to the duly notarized Custodians that gives the registered address of the FIIs/sub-accounts can be accepted as proof of address. The NRIs/PIOs would be required to comply with the mandatory requirement of producing PAN Card at the time of opening a BO account. However, such NRIs/PIOs who are not able to obtain PAN for one reason or the other but are holding securities in physical form and desire to sell the same, are permitted to open a “limited purpose BO account” without PAN subject to certain specified conditions. International Legal Cases and News Cases Criminal United States of America v. Tommy E. Jones The defendant sold crack cocaine to government agents who were part of an investigatory operation team to crack the rising cocaine threat in the city. He was convicted for this and for the related act of conspiring to distribute cocaine within 1000 feet of a public housing complex under 21 U.S.C. §§ 841(a)(1) and 846. At the sentencing hearing, the defendant sought leniency from the trial court on the ground that he was a family man and he claimed that he was not involved with any gang in selling cocaine. The District Court rejected his claim on the ground that even though he had a daughter he was not supporting her and he was previously convicted for aggravated sexual abuse of a minor. The Illinois Appellate Court however overturned this decision and hence the present appeal. On appeal, the defendant raised three issues. First, he claimed that the district court erred in not dismissing his indictment according to the Interstate Agreement on Detainers’ Act. Second, he argued that there was a reversible error at trial based on evidentiary admissions and the form of the jury instructions. Third, he challenged the propriety of his sentencing hearing and the length of his term, which was set at 300 months. The Court held that the defendant’s argument that his sentence by the District Court violated the Fifth Amendment Due Process Clause and the Ex Post Facto clause is without any merit. Therefore, the decision of the District Court was affirmed. Dixon v. United States The petitioner was charged with receiving a firearm while under indictment in violation of 18 U. S. C. §922(n) and with making false statements in connection with the acquisition of a firearm in violation of §922(a)(6). She admitted at trial that she knew she was under indictment when she purchased the firearms and knew that doing so was a crime, but claimed that she was acting under duress because her boyfriend had threatened to harm her and her daughters if she did not buy the guns for him. The trial court declined her request for a jury instruction placing upon the Government the burden to disprove her defense of duress and convicted her. The Fifth Circuit Court affirmed the decision. Relying on the decision in United States v. Bailey, (444 U. S. 394, 409-410), the US Supreme Court held that the trial court decision did not run foul of Due Process Clause. The burden of proving the defense of duress by preponderance of evidence is on the petitioner and not on the government as per common law. The decision of the Fifth Circuit Court was therefore upheld. Clark v. Arizona Petitioner in the present case was charged with first-degree murder under an Arizona statute for "intentionally or knowingly" killing a police officer while on duty. The prosecutor put forward circumstantial evidence and testimony to prove that the petitioner knew the victim was a police officer and that he had previously stated he wanted to shoot police and had lured the victim to the scene to kill him. The petitioner raised the defense of insanity and stated that he did not possess the requisite mens rea to do the crime. The trial convicted him of first-degree murder based on the finding that his schizophrenia was not so severe so as to distort his perception of reality. The finding was based on expert evaluation, petitioner’s actions before and after the shooting and the observations of people who knew him. Held, under current Arizona law, a defendant will not be adjudged insane unless he demonstrates that at the time of the crime, he was afflicted with a mental disease or defect of such severity that he did not know the criminal act was wrong and therefore not violative of due process of law. Decision of lower courts affirmed. Constitution Beard V. Banks The State of Pennsylvania houses its 40 most dangerous and recalcitrant inmates in a Long Term Segregation Unit (LTSU). Inmates begin at level 2, which has the most severe restrictions and then graduate to the less restrictive level 1. Plaintiff-respondent, a level 2 inmate, filed this suit against defendant-petitioner, the Secretary of the Department of Corrections. The plaintiff-respondent alleged that a level 2 policy forbidding inmates any access to newspapers, magazines, and photographs violated the First Amendment. The trial court ruled in favour of defendant-petitioner. On appeal, the Third Circuit Court reversed the judgement of the trial court holding that the prison regulation could not be supported as matter of law. The Supreme Court reversed the judgement of the Third Circuit Court and ruled in favour of defendant-petitioner. The Supreme Court held that prison officials have set forth adequate legal support for the Policy and that the plaintiff-respondent failed to show specific facts that could warrant a determination in his favor. News Accused in Texas Drowning Case found not guilty by jury A Texas jury found the accused, a 42-year-old woman, not guilty by reason of insanity of drowning her five children. Earlier, she was convicted by another jury who found her guilty of the charge of murder but received a retrial, as the Texas First Court of Appeals overturned the conviction because of erroneous testimony from a prosecution witness. The attorney of the accused had argued that she suffered from severe postpartum psychosis due to which she believed that Satan was within her and drowned her four children to save them from going to hell. The accused will now be committed to a Texas mental hospital and will undergo periodic hearings to determine whether she will be eligible for release. DOJ bid to dismiss NSA wiretapping suit against telecom giant AT&T rejected by Federal Judge A federal judge rejected a US Department of Justice (DOJ) motion to dismiss a class action lawsuit brought against Telecom giant AT&T on state secrets grounds. Apparently, the telecommunications giant is alleged to have violated citizens' rights to privacy as well as several federal statutes when it allowed the National Security Agency to use its infrastructure to wiretap US citizens as part of the President's domestic surveillance program. The Judge reasoned that the broad media coverage had neutralized any danger of disclosing state secrets. This is the first time a judge has ruled on the government's invocation of the state secrets privilege in a warrantless phone-tapping case. New UK Criminal Justice Review to put Rights of Victims before Rights of Criminals The UK Government released a Criminal Justice System Review recently making several recommendations aimed at putting the rights of victims before the rights of criminals. The Home Office recommended ending automatic sentence reductions in exchange for guilty pleas, ending automatic parole consideration rights for life prisoners, requiring unanimous parole board votes to release prisoners, and deporting more foreign citizens to serve sentences in their home countries in order to strengthen sentencing procedure. The reform announcements coincided with the release of new UK Crime Statistics which demonstrated that violent crime rates have remained steady in recent years. Ruling of Federal Judge a second blow to KPMG Prosecution A Manhattan federal judge in the KPMG Tax Shelters Case ruled that the statements made by two partners of the accountancy firm KPMG cannot be used in their upcoming trial as federal prosecutors had coerced the two defendants into cooperating with the ongoing criminal tax shelters case by using excessive financial pressure over them. The Judge also ruled that the economic pressure led KPMG Vice Chairman and a former KPMG partner to waive their Fifth Amendment rights to remain silent in the absence of an attorney, and that federal prosecutors also coerced KPMG into threatening to fire employees who did not cooperate with the investigation. Earlier in the same case, the judge had ruled that the government violated the constitutional rights of 16 former KPMG employees by pressuring the accounting firm to stop paying the employees' defense costs. The 16 defendants are accused of setting up tax shelters, costing the US government an estimated $2.5 billion in revenue. KPMG has admitted that the tax shelters were illegal and has taken full responsibility for the unlawful conduct. It then agreed to pay the government a $456 million fine to avoid criminal prosecution for the tax shelters, and agreed to be supervised for three years by a former SEC chairman. Criminal complaint filed against Mexican Election Commission by Leftist Presidential Candidate Mexican leftist presidential candidate filed a criminal complaint against Mexican Election Commission, the Federal Electoral Institute alleging that it should have blocked campaign ads funded by private companies that he alleged broke election regulations. The Presidential Candidate claimed that the commercials contained subliminal messages supporting the candidature of the election winner. The candidate has filed 225 charges of election fraud with Mexico's Federal Election Tribunal to force a manual recount of the votes after he lost July 2 presidential election by 0.6 percent votes. Disclaimer (1) While all reasonable care has been taken to ensure that the information provided in the "round up" and on the website is fair and accurate the company and its promoters and employees shall not in any way be responsible for the consequences of any action taken on the basis of reliance upon the contents of this "round up". (2) This is not a Spam mail. You have received this mail because you have either requested for it or someone must have suggested your name under our various referral programs. Since India has no anti-spamming law, we refer to the US directive, which states that a mail cannot be considered Spam if it contains the sender's contact information, which this mail does. In case this mail doesn't concern you, please unsubscribe from mailing list. Feedback