Supreme Court Monthly Digest: July 2020

1. Dispute As To Inheritance Of Shares Cannot Be Decided In Proceedings U/s 241/242 Of Companies Act, 2013: SC Order dated July 6, 2020 The Supreme Court observed that a dispute as to inheritance of shares cannot be decided in proceedings under section 241/242 of the Companies Act, 2013. The bench comprising Justices Arun Mishra & S. Abdul Nazeer noted that, in Sangramsinh P. Gaekwad and Ors. v. Shantadevi P. Gaekwad (Dead) through LRs. and Ors., (2005) 11 SCC 314, it was held that the dispute as to inheritance of shares is eminently a civil dispute and cannot be said to be a dispute as regards oppression and/or mismanagement so as to attract Company Court's jurisdiction under sections 397 and 398 of Companies Act, 1956. [Case: Aruna Oswal v. Pankaj Oswal] 2. SC Nullifies Post-March 31 Sale Of BS-IV Vehicles ; Bars Registration Of Such Vehicles Order dated July 8, 2020 The Supreme Court recalled its March 27 order which allowed sale of 10% of unsold BS-IV vehicles for ten days after the lockdown, in areas except Delhi-NCR, after noting that the automobile dealers sold such vehicles during the lockdown in violation of the order. Following the recall of the order, a bench comprising Justices Arun Mishra, S. Abdul Nazeer & Indira Banerjee held that such vehicles sold during lockdown should not be treated as sold, and that the consideration received should be refunded to the purchasers. The Court also ordered that no such vehicle, sold after March 31, should be registered. [Case: MC Mehta v. Union of India] 3. Criminal Appeal Against Order Of Conviction Cannot Be Dismissed For Default: Reiterates SC Order dated July 8, 2020 The Supreme Court set aside a Madras High Court order that had dismissed a Criminal Appeal against an order of conviction for default. The bench comprising Justices RF Nariman, Navin Sinha & BR Gavai agreed with the contention put forth by the counsel, relying on the decision of the Supreme Court in KS Panduranga v. State of Karnataka (2013) 3 SCC 721, that an appeal against an order of conviction cannot be dismissed in default but must be taken up and decided on merits even if the appellant in-person or the counsel representing him, is not present. [Case: Sakunthala v. State] 4. Disabled Entitled To The Same Benefits As Given To SC-ST Candidates: SC Order dated July 8, 2020 The Supreme Court observed that people suffering from disabilities are also socially backward and are thus entitled to the same benefits as given to the Scheduled Castes/ Scheduled Tribes candidates. It held that the provision giving only 5% concession in marks to PWD candidates as opposed to 10% relaxation provided to SC/ST candidates is discriminatory and PWD candidates are also entitled to same treatment.While considering an appeal against a Punjab and Haryana High Court order, the bench headed by Justice RF Nariman said that it is 'following' the principle laid down in the Delhi High Court's judgment in Anamol Bhandari (Minor) through his father/Natural Guardian v. Delhi Technological University 2012 (131) DRJ 583. [Case: Aryan Raj v. Chandigarh Administration] 5. [Order VII Rule 11 CPC] If Plaint Does Not Disclose Cause Of Action Or Suit Is Barred By Any Law, The Court Has No Option But To Reject The Plaint: SC Order dated July 9, 2020 The Supreme Court observed that the provision of Order VII Rule 11 Code of Civil Procedure regarding 'Rejection of Plaint' is mandatory in nature. A bench comprising Justices L. Nageswara Rao & Indu Malhotra said: "It states that the plaint "shall" be rejected if any of the grounds specified in clause (a) to (e) are made out. If the Court finds that the plaintiff does not disclose a cause of action, or that the suit is barred by any law, the Court has no option, but to reject the plaintiff."The Court observed, inter alia: The power conferred on the court to terminate a civil action is, however, a drastic one, and the conditions enumerated in Order VII Rule 11 are required to be strictly adhered to.Under Order VII Rule 11, a duty is cast on the Court to determine whether the plaint discloses a cause of action by scrutinizing the averments in the plaint, read in conjunction with the documents relied upon, or whether the suit is barred by any law.The documents filed alongwith the plaint, are required to be taken into consideration for deciding the application under Order VII Rule 11 (a). When a document referred to in the plaint, forms the basis of the plaint, it should be treated as a part of the plaint.The test for exercising the power under Order VII Rule 11 is that if the averments made in the plaint are taken in entirety, in conjunction with the documents relied upon, would the same result in a decree being passed. If on a meaningful reading of the plaint, it is found that the suit is manifestly vexatious and without any merit, and does not disclose a right to ...

Supreme Court Monthly Digest: July 2020

Akshita Saxena

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