WhatsApp moves Delhi HC against traceability clause in IT rules, calls it is unconstitutional

WhatsApp moves Delhi HC against traceability clause in IT rules, calls it is unconstitutional

Introduction

Faced with a deadline to comply with the Indian government’s new rules for social media intermediaries, which needs them to make provisions for “identification of the first originator of the information”, Facebook-owned messaging platform WhatsApp has moved the Delhi High Court challenging this aspect of the new rules. The petition was filed on May 25, the final date of compliance alleging that the aforesaid clause is violative of a person’s right to privacy as enshrined in the Supreme Court judgment of KS Puttuswamy v. Union of India.

WhatsApp Moves Delhi HC Against Centre’s New IT Rules

Whatsapp Arguments

The Whatsapp Spokesperson said that “Requiring messaging apps to ‘trace’ chats is the equivalent of asking us to keep a fingerprint of every single message sent on WhatsApp, which would break end-to-end encryption and fundamentally undermines people’s right to privacy,” 

He further added that “We have consistently joined civil society and experts around the world in opposing requirements that would violate the privacy of our users. In the meantime, we will also continue to engage with the Government of India on practical solutions aimed at keeping people safe, including responding to valid legal requests for the information available to us,”

WhatsApp argues that “traceability inverts the way law enforcement typically investigates crimes”. “In a typical law enforcement request, a government requests technology companies provide account information about a known individual’s account. With traceability, a government would provide a technology company a piece of content and ask who sent it first,”

The post titled, ‘What is traceability and why does WhatsApp oppose it?’ says: “In order to trace even one message, services would have to trace every message. That’s because there is no way to predict which message a government would want to investigate in the future. In doing so, a government that chooses to mandate traceability is effectively mandating a new form of mass surveillance.”

Government Response

The Indian government said that it respects the “Right of Privacy” and has no intention to violate it when WhatsApp is required to disclose the origin of a particular message.

The statement released by the Ministry of Electronics and IT (MEITY) comes hours after the social messaging app filed a lawsuit in Delhi High Court challenging the government’s new digital rules saying the requirement for the company to provide access to encrypted messages will break privacy protections.

The statement added that “Such requirements are only in case when a particular message is required for prevention, investigation or punishment of serious offences such as sexually explicit content,” furthermore they said that, “The Government of India recognises that ‘Right to Privacy” is a Fundamental right and is committed to ensure the same to its citizens, Such requirements are only in case when a particular message is required for prevention, investigation or punishment of serious offences such as sexually explicit content,” the statement added.

However, it also added that as per all established judicial dictum, “no Fundamental Right, including the Right to Privacy, is absolute and it is subject to reasonable restrictions. The requirements in the Intermediary Guidelines pertaining to the first originator of information are an example of such a reasonable restriction.”

On this issue, IT minister Ravi Shankar Prasad has said, “the Government of India is committed to ensuring the Right of Privacy to all its citizens but at the same time it is also the responsibility of the government to maintain law and order and ensure national security.” He also stated that “none of the measures proposed by India will impact the normal functioning of WhatsApp in any manner whatsoever and for the common users, there will be no impact.”

Conclusion

The new 2021 IT Rules will now at least mandate reasons for such takedowns to be debated, and provided the three-tier grievance redressal mechanism works, it will provide material for the High Courts and Supreme Court to examine them, in the event Government actions are challenged. Intermediaries now have enhanced due diligence and monitoring burdens, and are also expected to continuously educate users on what can and cannot be posted. This will assist in establishing a trend of self-regulation, especially in relation to social media intermediaries, thanks to tools provided by artificial intelligence.

Advance ruling mechanisms under GST

Advance ruling mechanisms under GST

INTRODUCTION

An advance tax ruling is a written interpretation of tax laws. An advance ruling is often requested when the taxpayer is confused and uncertain about certain provisions. It is issued by tax authorities to corporations and individuals who request for clarification of certain tax matters. Advance tax ruling is applied before starting the proposed activity. By means of advance ruling a written interpretation is received on the basis of the companies or individuals as the case may be. This article discusses the nitty-gritties of the “Advance Ruling” mechanism of GST like, its purpose and objective and procedure. In addition to this, the effectiveness of the complete system is alsoSynopsis of the Entire Mechanism of Advance Ruling under GST - Corpbiz discussed. 

OBJECTIVES OF ADVANCE RULING

The advance ruling can be obtained by a registered taxpayer (i.e. who has a GST Registration certificate) on a current transaction, i.e. The transaction that has already been undertaken or a proposed transaction.

The objective of any advance ruling, including under GST is to-

  • Provide certainty for tax liability in advance in relation to a future activity to be undertaken by the applicant.
  • Attract Foreign Direct Investment (FDI) – By clarifying taxation and showing a clear picture of the future tax liability of the FDI. The clarity and clean taxation will attract non-residents who do not want to get involved in messy tax disputes.
  • Reduce litigation and costly legal disputes.
  • Give decisions in a timely, transparent and inexpensive manner.

 

PROVISIONS UNDER CGST ACT

“Advance ruling” means a decision provided by the Authority or the Appellate Authority to an applicant on matters or on questions specified in sub-section (2) of section 97 or subsection (1) of section 100 of the CGST Act, 2017, in relation to the supply of goods or services or both being undertaken or proposed to be undertaken by the applicant.

 

Matters or questions specified in Section 97(2) & Section 100(1) of the CGST Act, 2017:

  1. Classification of any goods or services or both 
  2. Applicability of a notification issued under the provisions of CGST Act 
  3. Determination of time and value of supply of goods or services or both 
  4. Admissibility of input tax credit of tax paid or deemed to have been paid 
  5. Determination of the liability to pay tax on any goods or services or both 
  6. Whether applicant is required to be registered  
  7. Whether any particular thing done by the applicant with respect to any goods or services or  both amounts to or results in a supply of goods or services or both, within the meaning of that term. 

 

Section 100(1) of the CGST Act, 2017 provides that the concerned officer, the jurisdictional officer or an applicant aggrieved by any advance ruling pronounced by the Authority for Advance Ruling, may appeal to the Appellate Authority. Thus it can be seen that a decision of the Appellate authority is also treated as an advance ruling.

PROCEDURE OF OBTAINING ADVANCE RULING

Both the Authority for Advance Ruling (AAR) & the Appellate Authority for Advance Ruling (AAAR) is constituted under the respective State/Union Territory Act and not the Central Act. This would mean that the ruling given by the AAR & AAAR will be applicable only within the jurisdiction of the concerned state or union territory. It is also for this reason that questions on determination of place of supply cannot be raised with the AAR or AAAR.

(Section 97 Application for Advance Ruling) If applicant has doubts/problems w.r.t. classification, applicability of notifications, input tax credit, registration, liability of tax, time and value of supply or determination of supply of goods or services or both then he may apply for the advance ruling to advance ruling authority in form AAR 1 along with Fees of Rs 5000. for removing the doubts. 

(Section 98 Procedure on receipt of application) AAR may accept or reject the application after calling the records from the concerned officer. AAR shall before reject the application give opportunity of being heard and reasons of rejecting the application to the party. There may be a case if matter is pending or decided in the proceeding then application related to such matter shall not be admitted by the AAR. If AAR accepts the application, the ruling shall be pronounced within 90 days from the date of application. 

If on any point the opinion of members of AAR differ, then it states the point of difference and refers to AAAR for final discussion and ruling shall be pronounced by AAAR within 90 days. If on any point the opinion of members of AAAR is differ then no ruling can be pronounced further. 

Section 100 Appeal to Appellate Authority If any party, is aggrieved by the pronouncement of ruling of AAR, may appeal to the AAAR within 30 days from the date of receipt of ruling (extension 30 days if sufficient cause of delay) in FORM AAR 2 along with Fees Rs 10,000.

Section 101 Order of the Appellate authority Opportunity of being heard is given to the parties before passing the order by AAAR. Order shall be passed within 90 days from the date of filing of appeal and appellate order shall be communicated to parties. 

Section 102 Rectification of Advance Ruling If there is any mistake apparent on record found by the AAR itself or brought to its notice by jurisdictional officer or applicant, application for rectification can be made within 6 months from the date of order.

If rectification results in an increase in tax liability or reduction in input tax credit, OBH must be given by the AAR. 

Section 103 Binding effect of Advance Ruling Once the advance ruling is pronounced, binding on the applicant and jurisdictional officer unless there is change in law/facts/circumstances on the basis of which advance ruling had been pronounced by the AAR. 

Section 104 Advance Ruling to void in certain circumstances Advance ruling is declared void ab initio if it is found by the AAR/AAAR that ruling has been obtained by misrepresentation of facts or suppression of facts by the party and provision of the Act will be applied as if advance ruling had not been pronounced. Before passing the order opportunity of being heard shall be given to the party and order shall be communicated to the applicant and concerned officer.

 

 

CHALLENGING THE AAR ORDER

Since AAR is not the final authority, a pronouncement by AAR is prone to litigation. The Supreme Court has, in the case of Columbia Sports Wear held that the orders of AAR can be challenged by filing a Writ Petition before the High Court.

Moreover, SLP against an advance ruling could also be considered by the Supreme Court if it involves a question of principle of great importance or if a similar question is already pending before the Supreme Court.

EFFECTIVENESS OF ADVANCE RULING MECHANISM

The taxpayers preferred to resort to the AAR mechanism to know the GST implications beforehand instead of facing litigation to decide the matter at a future point of time. A taxpayer can make an application to AAR for ruling in respect of specified matters and obtain an advance ruling in respect of such matters within a relatively shorter span of time.

However, looking at the past rulings by AAR and Appellate Authority for Advance Ruling (‘AAAR’), the majority of rulings have been decided in favour of revenue. This may be because of the fact that the AAR & AAAR is constituted of the Central & State revenue officers without inducting any judicial members.

Further, different AARs have pronounced different rulings on similar issues. This results in compliance challenges for the taxpayers. Due to such divergent rulings, the same taxpayer may be compelled to follow different legal positions in different States for a specific transaction. Though the GST Council has proposed to establish a central-level appellate authority to deal with such cases which can lend some uniformity to such rulings but to expect a judicial approach in such rulings would still be a distant dream.

CONCLUSION

The whole intent behind establishing the AAR was to reduce litigation and to provide certainty to the taxpayers. However, with revenue favored rulings and divergent rulings in case of the same transaction, it appears that the purpose of establishing AAR is not met by the Government. Instead of reducing litigation, the rulings are likely to increase the litigation because of pro-revenue rulings and divergent views on the same transaction.

Additionally, there are divergent views by the High Courts on allowing the writ petition filed against the orders passed by the advance ruling authorities. The legal position with respect to challenging the correctness of orders passed by AAAR before Courts is yet to be crystalized. The view of the Government is that the advance ruling mechanism is beneficial to the assessed as it reduces litigation, however, what would be the benefits to an assessed if the matters are always held in favor of the revenue by AAR/AAAR.

ARREST OF A SHIP UNDER ADMIRALTY LAW / MARITIME LAW

ARREST OF A SHIP UNDER ADMIRALTY LAW / MARITIME LAW

 

INTRODUCTION

“The safety of the people shall be the highest law” – Marcus Tullius Cicero

Ship Arrest Warrantied. Maritime Lawyers on Ship Arrest in Spain - GMM Law | Maritime Class Net

India has a long-standing history in dealing with the sea and has had a distinguished tradition for several years with trade and commerce, both within the region and beyond its territorial borders. India’s maritime history dates back to the 3rd millennium BCE, and since then many ships have sailed from India and, to India. Therefore, though there was no codified law as the one which exists today, the customs and regulations concerning sea and maritime activities have been in existence since time immemorial.

This article analyses the Maritime Law of India and the Law relating to ship arrests, including the jurisdiction, permissible claims and procedural aspects of ship arrests in India.

Before Independence, the laws relating to maritime laws in India were governed under the British government. The Coasting Vessels Act, 1838, Inland Steam Vessels Act, 1917, Admiralty Offences (Colonial) Act, 1849, Indian Registration of Ships Act, 1841, Indian Ports Act, 1908, Control of Shipping Act, 1947 are some of the regulations which deal with various aspects of maritime in India.

MEANING OF MARITIME LAW

In simple words, Maritime Law is a set of rules and regulations which govern the matters relating to sea and ships. It is also known as admiralty law. Numerous legal luminaries have provided their definition of the term ‘maritime law.’ Some of them are as follows:

Professor Grant Gilmore and Charles L. Black, in their ‘Law of Admiralty’, define maritime or Admiralty Law as the following:

”A corpus of rules, concepts and legal practices governing certain centrally important concerns of the business of carrying goods and passengers by water.”

Black’s Law dictionary defines maritime Law as- “the body of law governing marine commerce and navigation, the carriage at of persons and property, and marine affairs in general; the rules governing contract, tort and workers’ compensation claims or relating to commerce on or over water.”

The definitions, given above covers a wide range of activities concerning the sea, however now with the evolution of Law, the Maritime Law is comprehensive, and it is that branch of jurisprudence which covers all the matters relating to sea and ships.

SHIP ARREST

Ship arrest is a process in which a ship is prevented from trading or moving until the matter in question is decided. It is an exclusive jurisdiction that is granted to an admiralty court to detain a vessel to secure a maritime claim.

Article 2 of the International Convention Relating to the Arrest of Sea-Going Ships, 1952 defines the term arrest as the following:

“(2) “Arrest” means the detention of a ship by judicial process to secure a maritime claim, but does not include the seizure of a ship in execution or satisfaction of a judgment.”

The main purpose of arrest is to obtain security for satisfaction of judgment in the action in rem and it is necessary to arrest the ship in order to establish jurisdiction. Merchant ships of different nationalities travel from port to port carrying goods or passengers. They incur liabilities in the course of their voyage and they subject themselves to the jurisdiction of foreign States when they enter the waters of those States. They are liable to be arrested for the enforcement of maritime claims, or seized in execution or satisfaction of judgments in legal actions arising out of collisions; salvage, loss of life or personal injury, loss of or damage to goods and the like. They are liable to be detained or confiscated by the authorities of foreign States for violating their customs, regulations, safety measures, rules of the road, health regulations, and for other causes. The coastal State may exercise its criminal jurisdiction on board the vessel for the purpose of arrest or investigation in connection with certain serious crimes. In the course of an international voyage, a vessel thus subjects itself to the public and private laws of various countries. A ship travelling from port to port stays very briefly in any one port. A plaintiff seeking to enforce his maritime claim against a foreign ship has no effective remedy once it has sailed away and if the foreign owner has neither property nor residence within jurisdiction. The plaintiff may therefore detain the ship by obtaining an order of attachment whenever it is feared that the ship is likely to slip out of jurisdiction, thus leaving the plaintiff without any security.

RATIONALITY

A ship arrest may be exercised under the authority of a court having admiralty jurisdiction, for the following reasons:

  1. Loss of life
  2. Loss of property
  3. Salvage
  4. Collision
  5. Execution of a decree
  6. Violation of customs, usages, regulations or norms

JURISDICTION OF INDIAN COURTS

Before India gained Independence, under The Colonial Court of Admiralty Act, 1890, the High Court of Bombay, Madras and Calcutta were the only judicial authorities competent to deal with matters relating to Admiralty. The other courts of justice were restricted from dealing with issues concerning the Admiralty. Under the Admiralty Courts Act, 1861, the three presidency courts were vested with the same powers as that of the High Court of England.

Section 35 of the Admiralty Courts Act, 1861 deals with the jurisdiction of Admiralty court, and it reads as the following:

“35. The jurisdiction conferred by this Act on the High Court of Admiralty may be exercised either by proceedings in rem or by proceedings in personam.”

The Law relating to Admiralty jurisdiction is relevant even today under Article 372 of the Constitution of India.

Therefore, in M.V. Elisabeth vs Harwan Investment and Trading, 1993 AIR SC 1014, the question was whether a court having no admiralty jurisdiction could entertain a case relating to Admiralty. The Supreme Court, in this case, widened the scope of admiralty jurisdiction in India.

The Court held

“Although statutes now control the field, much of the admiralty law is rooted in judicial decisions and influenced by the impact of Civil Law, Common Law, and equity. The ancient maritime codes like the Rhodian Sea Law, the Basilika, the Assizes of Jerusalem, the Rolls of Oleron, the Laws of Visby, the Hanseatic Code, the Black Book of the British Admiralty, Consolato del Mare, and others are, apart from statute, some of the sources from which the Law developed in England. Any attempt to confine Admiralty or maritime Law within the bounds of statutes is not only unrealistic but incorrect.”

THE SUPREME COURT MADE THE FOLLOWING OBSERVATION

“The High Courts in India are superior courts of record. They have original and appellate jurisdiction. They have inherent and plenary powers. Unless expressly or impliedly barred, and subject to the appellate or discretionary jurisdiction of this Court, the High Courts have unlimited jurisdiction, including the jurisdiction to determine their powers.”

Further, in this case, the International Convention for the unification of some rules regarding Arrest of Sea-going Ships (The Arrest Convention), 1952 was also made applicable to India, although it was not ratified.

Similarly, In the M.V Sea Success case, the Supreme Court held that the principles laid down in 1999 Geneva Arrest Convention could be applied in India on matters concerning Admiralty.

In India, The Admiralty (Jurisdiction and Settlement of Maritime Claims) Act, 2017 was enacted on 9 August 2017 to consolidate the laws relating to Admiralty. The Act implemented, repeals all the outdated provisions relating to Admiralty.

As per Section 3 of the Admiralty (Jurisdiction and Settlement of Maritime Claims) Act, 2017, the jurisdiction concerning admiralty matters shall be vested in the respective High Courts, and the courts shall exercise their authority within the territorial waters of their jurisdiction.

Therefore, now the scope of admiralty jurisdiction has been widened, and apart from the presidency courts, the following courts (coastal regions) have jurisdiction to deal with admiralty matters:

  1. High Court of Gujarat
  2. High Court of Andhra Pradesh
  3. High Court of Orissa
  4. High Court of Kerala

PERMISSIBLE CLAIMS

The High Courts’ as discussed earlier, has the jurisdiction to entertain claims as provided under Article 1 of the Arrest Convention, 1952 and Article 1 of the Geneva Arrest Convention, 1999. Therefore, before the enactment of the Admiralty (Jurisdiction and Settlement of Maritime Claims) Act, 2017, the claims were as provided under the conventions as discussed earlier. However, now the Law relating to Maritime claim is provided under section 4 of the Admiralty (Jurisdiction and Settlement of Maritime Claims) Act, 2017.

Section 4 of the Act reads as the following:

“The High Court may exercise jurisdiction to hear and determine any question on a maritime claim, against any vessel, arising out of any

  • a dispute regarding the possession or ownership of a vessel or the ownership of any share therein
  • dispute between the co-owners of a vessel as to the employment or earnings of the vessel
  • mortgage or a charge of the same nature on a vessel;
  • loss or damage caused by the operation of a vessel
  • loss of life or personal injury occurring whether on land or on water, in direct connection with the operation of a vessel
  • loss or damage to or in connection with any goods
  • agreement relating to the carriage of goods or passengers on board a vessel, whether contained in a charter party or otherwise
  • salvage services, including, if applicable, special compensation relating to salvage services in respect of a vessel which by itself or its cargo threatens damage to the environment
  • Pilotage
  • goods, materials, perishable or non-perishable provisions, bunker fuel, equipment (including containers), supplied or services rendered to the vessel for its operation, management, preservation or maintenance including any fee payable or leviable;
  • construction, reconstruction, repair, converting or equipping of the vessel;
  • dues in connection with any port, harbour, canal, dock or light tolls, other tolls, waterway or any charges of similar kind chargeable under any law for the time being in force
  • claim by a master or member of the crew of a vessel or their heirs and dependents for wages or any sum due out of wages or adjudged to be due which may be recoverable as wages or cost of repatriation or social insurance contribution payable on their behalf or any amount an employer is under an obligation to pay to a person as an employee, whether the obligation arose out of a contract of employment or by operation of a law (including operation of a law of any country) for the time being in force, and includes any claim arising under a manning and crew agreement relating to a vessel, notwithstanding anything contained in the provisions of sections 150 and 151 of the Merchant Shipping Act, 1958 (44 of 1958)
  • disbursements incurred on behalf of the vessel or iparticular average or general average
  • dispute arising out of a contract for the sale of the vessel
  • insurance premium (including mutual insurance calls) in respect of the vessel, payable by or on behalf of the vessel owners or demise charterers
  • commission, brokerage or agency fees payable in respect of the vessel by or on behalf of the vessel owner or demise charterer
  • damage or threat of damage caused by the vessel to the environment, coastline or relate interests; measures taken to prevent, minimize, or remove such damage; compensation for such damage; costs of reasonable measures for the restoration of the environment actually undertaken or to be undertaken; loss incurred or likely to be incurred by third parties in connection with such damage; or any other damage, costs, or loss of a similar nature to those identified in this clause
  • costs or expenses relating to raising, removal, recovery, destruction or the rendering harmless of a vessel which is sunk, wrecked, stranded or abandoned, including anything that is or has been on board such vessel, and costs or expenses relating to the preservation of an abandoned vessel and maintenance of its crew; and
  • maritime lie

PROCEDURE FOR ARREST

The Law relating to the arrest of a vessel in rem is provided under Section 5 of the Admiralty (Jurisdiction and Settlement of Maritime Claims) Act, 2017.

Under the section, the High Court may order for the arrest of any vessel within its jurisdiction, where there is a reason to believe:

  • The owner of the vessel is liable for the claim, or
  • The demise charterer of the vessel is liable for the claim, or
  • The claim is based on a mortgage or similar charge, or
  • The claim relates to possession or ownership, or
  • The claim is against the owner, demise charterer, manager or operator of the vessel.

Once the claim has been decided, the claimant has to state the detailed facts, along with the other particulars and must make an application for the substantive suit. The Admiralty suit should specify:

  • The name of the claimant
  • The name of the vessel
  • Flag of the Vessel
  • Details of the owner of the ship
  • Facts relating to the dispute
  • Grounds and
  • Prayer

Once an arrest warrant is issued upon a vessel, the owner of the vessel has to appear and settle the claim or challenge the arrest made. The vessel may be allowed to sail subject to furnishing of security for the claim. At the default of the owner, the ship can be sold, and the sale proceeds may be used to settle the claim.

Therefore, the Law relating to ship arrest is now well settled in India. The admiralty law is an area of development, and it plays an inevitable role in protecting the citizens as well as ensuring that no organization or individual violates the Law of the sea.

CONCLUSION

Therefore, the Law relating to ship arrest is now well settled in India. The admiralty law is an area of development, and it plays an inevitable role in protecting the citizens as well as ensuring that no organization or individual violates the Law of the sea.

NEW SOCIAL MEDIA RULES TO CURB MISUSE OF SOCIAL MEDIA

NEW SOCIAL MEDIA RULES TO CURB MISUSE OF SOCIAL MEDIA

Introduction

The Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021 (the “Intermediary Rules”) fundamentally change the way the internet will be experienced in India. Most notably, the Rules now will bring government control rather than regulation over digital news platforms and OTT video content providers. Several requirements under them suffer from unconstitutionality and undermine the free expression and privacy for millions of internet users in India.

On Feb 25, these rules were notified in the official gazette as the “Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021”. For convenience, let’s just call them the Intermediary Rules. The Intermediary Rules have replaced the Information Technology (Intermediaries guidelines) Rules, 2011 (or the 2011 Rules). In this post, we bring a much more in-depth and legal analysis of the Intermediary Rules breaking down the top five changes in each chapter that impact your digital rights. New Social Media Rules LIVE Updates: Facebook Says It Aims To Comply With  The Guidelines

Due Diligence Requirements for Intermediaries

The Rules came into effect on 25 February 2021. However, the provisions pertaining to due diligence requirements for significant social media intermediaries have been given a lead time of three months from the date of notification of the threshold of a significant social media intermediary (i.e. 25 February 2021) to implement the prescribed measures. Non-compliance with the provisions of the Rules may disqualify the intermediary from seeking exemption of liability under the IT Act and the intermediary may be liable to punishment under any law for the time being in force, including the IT Act and the Indian Penal Code 1860.

  1. Furnishing information to the government: The Rules state that intermediaries must provide information for verification of identity or assistance to any lawfully authorised government agency for prevention, detection, investigation and prosecution of offences or for cyber security incidents, no later than 72 hours of receiving a written order.
  2. Preservation of records: The Rules require intermediaries to preserve, maintain, and/or store the following information for 180 days: (a) any information that has been removed or access to which has been disabled under certain provisions of the Rules; and (b) user’s information regarding registration, after cancellation or withdrawal of such registration.
  3. Disabling access: Intermediaries are not permitted to store, host or publish unlawful information which is prohibited under any law for the time being in force. In case such unlawful information is hosted, stored or published, the intermediary must remove or disable access to such information as early as possible, but within 36 hours of receiving a court order or being notified by a government agency.
  4. Removal of/ disabling access to explicit content: The Rules require expeditious action from an intermediary to remove or disable, within 24 hours of complaint, access to any material exposing the private area of any person, material with any nudity or depiction of any sexual act or conduct, or impersonation in an electronic form. In addition, intermediaries must provide a mechanism for receipt of complaints from users to enable them to provide details in relation to such explicit content.
  5. Grievance redressal: Under the Rules, intermediaries must prominently publish on website, mobile application or both- (a) the name and contact details of grievance officer and (b) the complaint mechanism. The grievance officer must acknowledge the complaint within 24 hours and dispose of it within 15 days and provide reasons to the complainant for any action / inaction.
  6. Details to be published: Intermediaries must prominently publish rules and regulations, privacy policy and user agreement on its website, mobile based application or both. The users must be informed about types of information that are ‘objectionable’ which they shall not share, display, upload, etc. In addition to the types of objectionable information prescribed under the 2011 Rules, certain new types of information have been specified under the Rules. Therefore, intermediaries will have to consider revising the existing documents in this regard. Intermediaries must inform users at least once every year about (a) rules and regulations, privacy policy or user agreement and any changes thereunder; and (b) intermediary’s right to terminate user’s access or remove the non-compliant information from its platform in case of non-compliance with the rules and regulations, privacy policy or user agreement.

Other Diligence Requirements for Significant Social Media Intermediaries

  1. Significance threshold: Social media intermediaries with fifty lakh (five million) registered users or more have been classified as significant social media intermediaries and are subject to additional due diligence requirements beyond those prescribed for intermediaries in general. However, the Government may require any other intermediary to also comply with the rules applicable to significant social media intermediaries if services of such intermediary impose a material risk to the sovereignty or integrity of India, security of the State, etc. While in practice this could prove to be more of an enabling provision for the Government, at this initial juncture it appears that even relatively smaller social media platforms, could be brought under the ambit of stricter compliances under the Rules.
  2. Officers and contact address in India: All significant social media intermediaries are required to appoint: 
    1. Chief Compliance Officer; 
    2. Nodal Contact Person; and 
    3. Resident Grievance Officer, 

each of whom are to be employees residing in India. The Rules also necessitate significant social media intermediaries to have a physical contact address in India published on its website or mobile application or both. These mandatory requirements for all significant social media intermediaries, not only has significant implications in terms of setting up infrastructure and deployment of resources and employees in India but may also have significant commercial and tax implications for such intermediaries. However, absence of a mandatory incorporation requirement does leave flexibility for foreign intermediaries who do not have an incorporated entity in India.

  1. Active monitoring: In a departure from the 2011 Rules, significant social media intermediaries shall endeavour to deploy technology-based measures, including automated tools to identify information that depicts rape, child sexual abuse or conduct, or information that has previously been removed. The Rules also require maintenance of appropriate human oversight, and periodic review of such automated tools. The measures deployed are required to take into consideration the interests of free speech and expression, and privacy of users, including interests protected through the appropriate use of technical measures.
  2. Compliance report: Significant social media intermediaries must publish a monthly report containing details of- 
    1. the complaints received; 
    2. action taken; and 
    3. number of links/ information removed or to which access is disabled, 

pursuant to any proactive monitoring by using automated tools or any other relevant information as may be specified.

  1. Identification of first originator of information: Significant social media intermediaries which provide messaging services will be required to enable identification of the first originator of information if required by a court order or an order passed under Section 69 of the IT Act. In case the originator is outside the Indian territory, the first originator in India will have to be identified. The Rules mention that the contents of the message are not required, but the identity of the originator is required to be disclosed.
  2. Voluntary verification: The Rules impose an obligation on significant social media intermediaries to enable users who register for their services from India, or use their services in India, to verify their accounts by using any appropriate mechanism, including the active Indian mobile number of such users, to verify their accounts and to provide a visible mark of verification. However, it is specified that the verification cannot be used for any other purpose unless consented by the user.
  3. Grievance redressal: The grievance redressal mechanism of a significant social media intermediary is required to enable tracking of the grievance/complaint through a ticket number associated with such complaint. The intermediary is required to provide reasons for any action/inaction. The proposed mandatory grievance redressal mechanism may entail considerable overhaul of the existing grievance redressal mechanism.
  4. Removal of/disabling access to information: In case any objectionable information is removed by an intermediary on its own accord, following steps need to be taken – 
    1. ensure that prior to the removal/ disabling access, the user who created, shared, uploaded such content is notified of such removal/ disabled access along with reasons; 
    2. provide adequate and reasonable opportunity to the user to dispute the action and request for reinstatement of such access; and 
    3. resident grievance officer to maintain appropriate oversight over the dispute resolution mechanism.

RULES FOR OTT Platform & Digital Media

  1. The government has called for a grievance redressal system for OTT platforms and digital news media portals as well. The government is also asking OTT platforms and digital news media to self-regulate and wants a mechanism for addressing any grievances.
  2. While films have a censor board, OTT platforms will be required to self-classify their movies and content based on age. The content will have to be classified based on age appropriateness. The government wants the OTT players to classify films based on 13+, 16+ and those for adults and clarified it is not bringing any kind of censorship to these platforms.
  3. There has to be a mechanism of parental lock and ensuring compliance with the same. Platforms like Netflix already have an option for a parental lock.
  4. For publishers of news on digital media, they will be “required to observe Norms of Journalistic Conduct of the Press Council of India and the Programme Code under the Cable Television Networks Regulation Act thereby providing a level playing field between the offline (Print, TV) and digital media,” according to the government.
  5. It also wants a three-level grievance redressal mechanism. This will include self-regulation by the publishers; self-regulation by the self-regulating bodies of the publishers and oversight mechanism.
  6. The government wants digital media to appoint a Grievance Redressal Officer based in India who shall be responsible for the redressal of grievances received by it. The officer shall take decision on every grievance received by it within 15 days.
  7. There may be one or more self-regulatory bodies of publishers. According to the rules, this body “shall be headed by a retired judge of the Supreme Court, a High Court or independent eminent person and have not more than six members.”
  8. The body will have to register with the Ministry of Information and Broadcasting. This body will oversee the adherence by the publisher to the Code of Ethics and address grievances that have not been resolved by the publisher within 15 days.
  9. Further, the Ministry of Information and Broadcasting shall formulate an oversight mechanism. It shall publish a charter for self-regulating bodies, including Codes of Practices and establish an Inter-Departmental Committee for hearing grievances.

Current Scenario

As per May 26, Indian microblogging platform Koo on Saturday said it has met the compliance requirements of the new guidelines for digital platforms.  

  • A Facebook spokesperson noted that the company is working to implement operational processes and aims to comply with the provisions of the IT rules.
  • A Google spokesperson said the company has consistently invested in significant product changes, resources and personnel to ensure that it is combating illegal content in an effective and fair way, and to comply with local laws in the jurisdictions it operates in.

However, As per May, 26 both the companies have not yet accepted the rules laid by the central government.

On May, 26 WhatsApp moved the Delhi high court against the new rules announced in February for digital media companies, saying the requirement for them to adopt features such as traceability for identifying originators of messages violated the right to privacy under the Indian law and the company’s end-to-end encryption policy. It said the company does not believe traceability can be imposed in a way that cannot be spoofed or modified, leading to new ways for people to be framed for things they did not say or do.

Conclusion

The massive growth of digital platforms and social media in India has largely been fuelled by a moderate regulatory framework under the IT Act and 2011 Rules, with the online curated content space being largely unregulated. However, given the growing concerns around the information and content available over social media and content platforms across both, domestic, and foreign owned platforms accessible in India, detailed regulations for digital media from the Government were imminent.

With the digital space and technology constantly evolving world over, the regulatory framework for digital media will also develop further. Keeping this in perspective, it is imperative that stakeholders, policy makers, and Governmental bodies continue to engage in consultations and dialogue, to eventually achieve a regulatory landscape that is effective yet balanced for everyone.

 

Author: Vinay Sachdev

Editor: Adv. Aditya Bhatt & Adv. Chandni Joshi

What are Small and Commercial Quantity of Narcotic Drugs under NDPS Act?

What are Small and Commercial Quantity of Narcotic Drugs under NDPS Act?

What is the Narcotic Drugs and Psychotropic Substances Act (NDPS) Act of 1985?

According to Section 2 of NDPS Act:

‘Commercial quantity’, in relation to narcotic drugs and psychotropic substances, means any quantity greater than the quantity specified by the Central Government by notification in the official gazette.

‘Small quantity’, in relation to Narcotic Drugs and Psychotropic Substances, means  any  quantity lesser than the quantity specified by the central government by notification in the Official Gazette.

Intermediate Quantity: that although the terminology “Intermediate Quantity”, is nowhere defined in the Act in definition part, but the terminology used is “lesser than commercial quantity but greater than small quantity”, when it comes to stipulating the punishment for the offences. 

Offences  under commercial quantities are non-bailable  U/S 37 NDPS Act 1985. However,  if  the court finds that the accused is not guilty of offence or is not likely to indulge in sale/  purchase of narcotic drugs, bail can be granted.

The punishment for many offences  under Sections 1523 of NDPS Act depends on the type and quantity of drugs involved—with three levels of punishments for small, Intermediate Quantity, i.e. quantity more than small and lesser than commercial quantity. 

The punishment prescribed for different quantities is as follows:

Where the contravention involves small quantities, with  rigorous  imprisonment  for  a term which may extend to six months, or with fine which may extend to Rs. 10,000 or with both.

Where the contravention involves quantity lesser than commercial quantity but greater than small quantity,  with rigorous imprisonment for a term which may extend to ten  years and with fine which may extend to Rs. 1,00,000.

Where the contravention involves commercial quantity,  with rigorous imprisonment for a term which shall not be less than ten years but which may extend to twenty years  and shall also be liable to fine which shall not be less than Rs. 1,00,000 but which may extend to Rs. 2,00,000s.

Section 27 of NDPS Act: Punishment for Consumption of Any Narcotic Drug or Psychotropic Substance. 

Whoever, consumes any narcotic drug or psychotropic substance shall be punishable,- 

Where the narcotic drug or psychotropic substance consumed is cocaine, morphine, diacetyl-morphine or any other narcotic drug or any psychotropic substance as may be specified in this behalf by the central government by notification in  the  Official  Gazette, with rigorous imprisonment for a term which may extend to one year, or with fine which may extend to Rs. 20,000; or with both.

Where the narcotic drug or psychotropic substance consumed is other than those specified in or under clause (a), with imprisonment for a term which may extend to six months, or with fine which may extend to Rs. 10,000 or with both.

Brief legislative history

Vidhi Centre for Legal Policy issued a report entitled: ‘From Addict to Convict’: Working of the NDPS Act in Punjab’. The Report, which is based on a review of 13,350 cases from Courts trying NDPS cases in Punjab from 2013 to 2015, concludes that the Narcotic Drugs and Psychotropic Substances Act, 1985 (“NDPS Act”) has not deterred drug use or drug trafficking and is in need of reform.

Possession for personal use v/s small quantity

The Report examines the law in relation to ‘small quantity’ and possession of drugs for personal use without appreciating the legislative history of section 27 of the NDPS Act.

The NDPS Act, as it stood in 1985, prescribed a minimum punishment of rigorous imprisonment for 10 years along with a fine of Rs 1 lakh for most offences with the exception of offences involving ganja and the cultivation of the cannabis plant, which attracted punishment upto 5 years imprisonment and fine of upto Rs 50,000.

The other exception was contained in section 27, which prescribed punishment of a maximum term of 6 months/1 year imprisonment (depending on the drug) or fine or both for consumption or illegal possession of any narcotic drug or psychotropic substance in ‘small quantity’, if the drug was proved to have been intended for personal consumption and not for sale or distribution. ‘Small quantity’ meant “such quantity as may be specified by the Central Government by notification in the Official Gazette.” The onus of proving that the drug was intended for personal consumption and not for sale or distribution lay on the accused person.

After the amendment in 1989, the Central Government issued fresh Notifications specifying the ‘small quantity’ of 220 narcotic drugs and psychotropic substances for the purposes of imposing lesser penalty under section 27 of the NDPS Act. The Report contains the recommendations of the Committee constituted by the Ministry of Health and Family Welfare for this purpose.

Though beneficent, section 27 was not used  

In several such cases, it was the Supreme Court that ultimately provided relief to the accused appellant by invoking the provision on small quantities. Despite the possibility of imposing a lesser sentence under section 27 of the NDPS Act, persons caught with small quantities of drugs were still sentenced to 10 years imprisonment and hefty fines, as most of the time; the accused  the person was unable to prove that the drug was meant for personal consumption and not for sale.

In several such cases, it was the Supreme Court that ultimately provided relief to the accused appellant by invoking the provision on small quantity. For instance in Raju v State of Kerala, the Appellant was found with possession of 100 mg heroin worth Rs. 25. The Appellant’s plea that the drug was for personal use was rejected by the lower Courts on the ground that he showed no symptoms of withdrawal while he was in custody and not using heroin. The Supreme Court expressed doubt whether such a small quantity of heroin could have been intended for sale to make profit. Ultimately, the Court invoked section 27 of the NDPS Act and modified the punishment from 10 years imprisonment to 1 year on the basis that the heroin was meant for personal use, even though the same was not ‘proved’.

Another reason why drug users did not invoke the plea of personal use under section 27 of the NDPS Act was that it would amount to an admission of being in possession of drugs and risk certain conviction.

The requirement of ‘admitting’ to illicit drug-possession and ‘proving’ personal use made section 27 of the NDPS Act inaccessible. As a result, a large number of persons including those who use drugs languished in jail without the possibility of bail and/or lenient sentences.

It was in this backdrop that the NDPS (Amendment) Bill, 1998 was introduced and passed in 2001 to introduce graded quantities

It was in this backdrop that the NDPS (Amendment) Bill, 1998 was introduced and passed in 2001 to introduce graded quantities.

Object and import of the 2001 Amendments – far reaching

The NDPS (Amendment) Act of 2001 was a watershed moment, as Parliament, in a rare occasion, acknowledged the harmful consequences of harsh provisions of the NDPS Act and sought to correct course by introducing graded penalties, on the basis of whether the offence involved drugs in ‘small’, ‘intermediate’ or ‘commercial quantity’.

Though the proposed changes were criticized in Parliament for being ‘soft on drug offenders’, Shri Yashwant Sinha, the then Finance Minister who introduced the Amendment Bill, remained firm and saw through its adoption by the House.

The Report however, faults the 2001 Amendment by stating that that it resulted in treating “anyone caught with drugs, whether for self-use or for sale, as a criminal.” This criticism is misplaced.

The NDPS Act has always criminalized consumption and possession of drugs for personal use. Drug users did not become criminals as a result of the NDPS (Amendment) Act, 2001.

Doing away with ‘personal use’, extended protection of the law. The Legislature’s decision to do away with the requirement of proving possession for personal use for imposing lesser punishment and adopting the uniform criteria of ‘small quantity’ offences must be seen in the context of non-application of section 27, discussed above.

The 2001 Amendments were far-reaching in that they extended lenient sentencing  (imprisonment upto 6 months and/or fine of Rs 10,000) and diversion (under sections 39 and 64A) to ‘anyone’ caught with a small amount of drugs, irrespective of whether the drug was meant personal use or sale. This also helped drug users who may be involved in sale or supply of small quantities to peers.

Problem is that quantity alone determines penalty

 The real drawback of the NDPS Amendment Act, 2001 is that quantity was made the sole determinant for the severity of penal measures imposed under the law including   restrictions on bail, pre-trial detention and sentencing. Other factors such as the role and involvement of the accused in the crime – whether he is a mere carrier or controls the illicit trade are rendered irrelevant.  The Report fails to examine this aspect completely.

Bail under NDPS act when small, intermediate and commercial quantities are involved

Union of India v. Shiv Shanker Kesari (2007) 7 SCC 798 

Hon’ble Supreme Court has explained the approach that a Court should adopt in an application for bail under Section 37 of the NDPS ACT:

“The Court while considering the application for bail with reference to Section 37 of the Act is not called upon to record a finding of not guilty.

It is for the limited purpose essentially confined to the question of releasing the accused on bail that the Court is called upon to see if there are reasonable grounds for believing that the accused is not guilty and records its satisfaction about the existence of such grounds.

But the Court has not to consider the matter as if it is pronouncing a judgment of acquittal and recording a finding of not guilty.

Additionally, the Court has to record a finding that while on bail the accused is not likely to commit any offence and there should also exist some materials to come to such a conclusion.”

Therefore, even in commercial quantity if the courts are satisfied of the reasonable ground for believing that the accused is not guilty of such offences ( Non compliance of mandatory provisions of the NDPS Act i.e. Section 42 or Section 50, disclosure statement of co-accused or accused is not corroborated by any independent incriminating evidence etc) along with the condition that the accused will not likely to commit offence if he was granted bail (keeping into consideration the antecedents of the accused, his propensities and the nature and the manner in which he is alleged to have committed the offence), the courts can grant regular bail even in commercial quantity cases.

Punishment for Offences

The NDPS Act views drug offences very seriously and penalties are stiff. The quantum of sentence and fine varies with the offence. For many offences, the penalty depends on the quantity of drug involved – small quantity, more than small but less than commercial quantity or commercial quantity of drugs. Small and Commercial quantities are notified for each drug.

Under NDPS Act, abetment, criminal conspiracy and even attempts to commit an offence attract the same punishment as the offence itself. Preparation to commit an offence attracts half the penalty. Repeat offences attract one and half times the penalty and in some cases death penalty. Since the penalties under this Act are very stiff, several procedural safeguards have been provided in the Act. Some immunities are also available under the Act. 

The penalties for various offences under the NDPS Act are as follows.

OFFENCES

PENALTIES

SECTIONS OF THE ACT.
Cultivation of opium, cannabis or coca plants without licenseRigorous imprisonment-up to 10 years + fine up to Rs.1 lakhOpium –  18(c) Cannabis – 20 Coca-16
Embezzlement of opium by licensed farmerRigorous imprisonment -10 to 20 years + fine Rs. 1 to 2 lakhs (regardless of the quantity)19
Production, manufacture, possession, sale, purchase, transport, import inter- state, export inter-state or use of narcotic drugs and psychotropic substancesSmall quantity – Rigorous imprisonment up to 6 months or fine up to Rs. 10,000 or both. More than small quantities but less than commercial quantities – Rigorous imprisonment. up to 10 years + fine up to Rs. 1 Lakhs. Commercial quantity – Rigorous imprisonment 10 to 20 years + fine Rs. 1 to 2 LakhsPrepared opium-17 Opium – 18 Cannabis – 20 Manufactured drugs or their preparations-21 Psychotropic substances -22
Import, export or transhipment of narcotic drugs and psychotropic substancesSame as above23
External dealings in NDPS-i.e. engaging in or controlling trade whereby drugs are obtained from outside India and supplied to a person outside IndiaRigorous imprisonment 10 to 20 years + fine of Rs. 1 to 2 lakhs (Regardless of the quantity)24
Knowingly allowing one’s premises to be used for committing an offenceSame as for the offence25
Violations pertaining to controlled substances (precursors)Rigorous imprisonment up to 10 years + fine Rs. 1 to 2 lakhs25A
Financing traffic and harboring offendersRigorous imprisonment 10 to 20 years + fine Rs. 1 to 2 lakhs27A
Attempts, abetment and criminal conspiracySame as for the offenceAttempts-28 Abetment and criminal conspiracy – 29
Preparation to commit an offenceHalf the punishment for the offence30
Repeat offenceOne and half times the punishment for the offence. Death penalty in some cases.31 Death – 31A
Consumption of drugsCocaine, morphine, heroin – Rigorous imprisonment up to 1 year or fine up to Rs. 20,000 or both. Other drugs- Imprisonment up to 6 months or fine up to Rs. 10,000 or both. Addicts volunteering for treatment enjoy immunity from prosecution27 Immunity – 64A
Punishment for violations not elsewhere specifiedImprisonment up to six months or fine or both32

 

SMALL AND COMMERCIAL QUANTITIES

For several offences under the NDPS Act, the punishment depends on whether the quantity of drug involved is small, is more than small but less than commercial or is commercial. Small and Commercial quantities for each drug have been notified.

 

The quantities for some common drugs are as follows

DrugSmall QuantityCommercial Quantity
Amphetamine2 grams50 grams
Buprenorphine1gram20 grams
Charas/HashishCharas/Hashish1 kg
Cocaine2 grams100 grams
Codeine10 grams1 kg
Diazepam20 grams500 grams
Ganja1 kg20 kg
Heroin5 grams250 grams
MDMA0.5 gram10 grams
Methamphetamine2 grams50 grams
Methaqualone20 grams500grams
Morphine5 grams250 grams
Poppy straw1 kg50 kg

 

 

Covid 19: Need of Comprehensive Health care Law in India (Part 2)

COVID‐19 health emergency: Union response and federal concerns

For the first time since independence, India is facing a major health emergency in the form of the COVID‐19 pandemic. The decision to impose a nationwide lockdown by the Central Government using the powers under Section 6(2)(i) of the DMA has raised certain questions by legal experts. The notification issued by the Secretary, Ministry of Home to all the state governments on March 24, 2020, asked all state and UT governments to send daily reports on how they are implementing the lockdown. Since then, the MoHFW has been issuing guidelines on various precautionary measures to be taken by all state/UT governments. However, there is opposition to the constitutional and legal validity of issuing lockdown orders under the DMA. The opposition to the implementation of the lockdown by the Central Government is based on two grounds. First, the imposition of the lockdown of all activities in the states and directed the district magistrates, who otherwise take orders from state governments, to implement the lockdown during the COVID‐19 outbreak is against the spirit of the Constitution as both public order, and health and sanitation come under the State List.

Coronavirus-related Legal Questions

The Central Government has formed the Inter‐Ministerial Central Teams (IMCT) under Section 10(2) of the DMA to conduct field visits in all states and UTs instead of forming an Inter‐State Council under Article 263 of the Indian Constitution. Secondly, there is a lack of fiscal and monetary help from the Central Government to the state/UT governments during this lockdown period. During this pandemic, the Central Government has taken the decision to control COVID‐19 and is largely dependent on existing legal tools like the EDA and the DMA. Safety and protection of lives is the prime goal of imposing a lockdown, and it was the only option for the country in attempting to control the virus as there is currently no vaccination. Narendra Modi, has been organizing video conferences with the chief ministers of respective state/UT governments along with other functionaries in the governments and taking their concerns and suggestions.

The decision to impose and then extend the lockdown three times was taken by the Central Government after consultation with the chief ministers. Regarding the fiscal and monetary help to federal units, the Central Government has initiated fiscal stimulus plans such as the Pradhan Mantri Garib Kalyan Yojana. Though the stimulus package is less than 1% of the GDP, there is space to do much more in the post‐lockdown period. The Central Government has to concentrate on strengthening the constitutional and legal provisions to face a future health emergency, keeping the basic structure of the Constitution intact.

There is a pertinent need to strengthen local authorities to deal with and address a pandemic situation with respect to testing, contact tracing, isolation wards, availability of personal protective equipment (PPE), and availability of data at the village level. There is a need for further financial transfers to local bodies more than ever in this situation. Finally, there is a lack of grievance redressal mechanisms in this act. It is vital that the citizens of this nation, when facing such unprecedented and challenging times, are provided with a framework to address their grievances at different levels.

Powers of Central Government 

When the Central Government is satisfied that India or any part thereof is visited by, or threatened with, an outbreak of any dangerous epidemic disease and that the ordinary provisions of the law for the time being in force are insufficient to prevent the outbreak of such disease or the spread thereof, the Central Government may take measures and prescribe regulations for the inspection of any ship or vessel leaving or arriving at any port in 2 [the territories to which this Act extends] and for such detention thereof, or of any person intending to sail therein, or arriving thereby, as may be necessary.]

(3)Penalty.—Any person disobeying any regulation or order made under this Act shall be deemed to have committed an offense punishable under section 188 of the Indian Penal Code (45 of 1860).

(4)Protection to persons acting under Act.—No suit or other legal proceedings shall lie against any person for anything done or in good faith intended to be done under this Act

  1. E) Section 188 of Indian Penal Code – “Section 188 of the Indian Penal Code prescribes punishment for disobeying an order duly promulgated by a public servant.” The above-mentioned law is for those defaulters who disobey the orders of the public servants and roan around aimlessly during the lockdown.
  2. F) Section 144 of the Criminal Procedure Code “Section 144 of Criminal Procedure Code (CrPC) imposes power to the executive magistrate to restrict a particular or a group of persons residing in a particular area while visiting a certain place or area.” The most important preventive measure against corona is safeguarded by this section that restricts to a gathering of people and thus in a way supports social distancing.
  3. G) Section 3 of the Essential Commodities Act, 1955 During this time of global crisis, the citizens need to know what counts as essential commodities and what items are to be avoided.
  4. H) Schedule 1 of the Essential services act provides a list of services in the category of essential that would we provided during the period of lockdown. The central government has allowed the flow of essential services during the lockdown thus it becomes extremely necessary for us to know what services are covered as essential in the act.
  5. I) Disaster Management Act, 2005 & National Disaster Management Guidelines, 2008 deals with the management of biological disasters.

While there is a list of laws related to COVID-19, we as responsible citizens need to realize that these laws are made for our betterment only and if we realize the seriousness of the ongoing crisis there would be no need to implement strict laws against the defaulters. The defaulters here are not just risking their lives but the lives of the nation as a whole. Time and again we are told to stay quarantined yet the police have to work on double shifts to penalize the defaulters. It is high time we take COVID-19 as a very serious issue and cooperate with the government to help not make India the second Italy.

Need to amend / repeal the Colonial-era Laws

Three suggestions emerge from this analysis to strengthen India’s constitutional and legal mechanisms for facing COVID‐19 and similar future scenarios after our review of various acts and constitutional provisions. Firstly, there is a serious need to review the colonial era EDA. Secondly, the passing of comprehensive public health law covering various aspects of health, which provides the right to health to all citizens is needed. Lastly, there is a need to explore various options to include health emergency provisions in the Indian Constitution.

1.Amendments to Epidemic Diseases Act, 1897

The EDA is deficient on the following grounds. 

  1. The act fails to define and categorize various kinds of diseases and the level of severity. 
  2. The act does not address the containment process and demarcation of zones based on severity levels; it simply prescribes the state’s role to restrict the movement of the individual. 
  3. The act does not mention the role of Panchayats and other local governments. 
  4. The act fails to mention the regulations of drugs and vaccines during an epidemic. 
  5. The act emphasizes controlling the spread of disease by ship, but there is no mention of air travel. Given modern realities, in which air travel far exceeds travel by ship, there is an urgent need for the provision of stricter screening measures needing to be taken at the airport and by airlines. 

To strengthen the act, the following amendments are required:

  1. The amendments related to identifying, testing, isolating, contact tracing, controlling, coordinating, and containing any epidemic are needed to make the EDA comprehensive to tackle any future health emergency.
  2. Changes related to the insertion of the definition and categorization of various diseases and demarcation of areas based on severity levels are needed.
  3. There is a serious need to clearly state the role of the Union for enhanced coordination with various state and local governments.
  4. The establishment of quarantine facilities inside or near airports should be explored and included in the act.
  5. Identification of the quarantine locations, which are geographically and scientifically advantageous to contain the pandemic, should be explored. These should be located in remote locations where there are naturally fewer inflows and outflows of people.

2. Need for comprehensive national public health law

The second suggestion is for the promulgation of a comprehensive national public health law. Though there have been attempts to establish a public health law—the Model Health Bill in 1955, updated in 1987, the National Health Bill in 2009, and the Public Health (Prevention, Control, and Management of epidemics, bio‐terrorism, and disasters) Bill 2017, these were not passed. In each of these cases, there was opposition from states, as health comes under state oversight. As discussed, States like Tamil Nadu and Madhya Pradesh have their own public health laws. There is a need to review various laws at the sub‐national level and also in different countries to strengthen India’s public health law. In Canada, the Public Health Agency of Canada Act in 2006 provides public health measures and emergency preparedness and response. At the federal level, the Public Health Agency of Canada (PHAC) is primarily responsible for “the promotion of health, prevention and control of chronic diseases, prevention and control of infectious diseases, and preparation and response to public health emergencies” . The Public Emergency Act and the Quarantine Act also empower federal units in Canada. In Australia, the National Health Security Act, 2007, establishes “structures and processes for preventing and responding to national health emergencies” in the country (Buchanan, 2015). England passed the Public Health (Control of Disease) Act of 1984, which protects the health of the public through a system of surveillance and action (Griffith, 2020). Closer to India, Singapore passed the Infectious Diseases Act (IDA) in 1976 and strengthened it during the global SARS epidemic in 2003 (Neo & Darius, 2020). Recently, Singapore also responded quickly and passed a temporary law—the COVID‐19 (Temporary Measures) Act 2020 (CTMA). Recently, the United States of America (USA) passed the Coronavirus Preparedness and Response Supplemental Appropriations Act, 2020, to fund research and development of vaccines, as well as therapeutics and diagnostics. A comprehensive national public health law must take into consideration practicable provisions in various countries’ legislative responses to a health emergency and try to strengthen India’s public health law while keeping social, political, economic, cultural, and environmental factors in mind. The role of the Union is crucial in creating an environment for a comprehensive public health law by reviewing and addressing the concerns of the states.

The comprehensive public health law should include the following provisions to ensure health care to citizens:

  1. The role of the Union, state, and local governments—panchayats and municipalities should be clearly defined without creating any conflicts.
  2. The Right to Health should be explicitly mentioned in the Indian Constitution through this act and include provisions for strengthening the medical infrastructure.
  3. An institutional mechanism that is able to establish a network with governments, research institutions, and health care providers should be included.
  4. The act should clearly state various processes and mechanisms for tracing testing and treatment for controlling the epidemics through appropriate and timely interventions at national, state, and local levels.
  5. Fiscal and monetary relief for states and local bodies during medical emergencies should be included.
  6. Special protection should be given to health care and sanitation workers keeping in mind the social dynamics of society.

3.Heath emergency provisions in the Indian Constitution

As discussed, there are no health emergency provisions in the Indian Constitution. Recently, after the declaration of the pandemic, France enacted the Emergency Response to the COVID‐19 Epidemic Act (2020), in a speedy procedure on March 23, 2020, to contain and control the epidemic. According to the new Act. L3131‐12 CSP, of the French Constitution, states, “the State of health emergency can be declared (…) in the event of a health disaster endangering, by its nature and gravity, the health of the population” . Japan also invoked a health emergency provision on April 7, 2020 by revising the New Influenza Special Measures Act. Article 352 of the Indian Constitution empowers the President to impose an emergency “whereby the security of India or any part thereof is threatened whether by war or external aggression or armed rebellion.” However, a health emergency is not grounds for imposing a national emergency and restricting the movement of people. India should explore various options for inserting a health emergency provision into the Indian Constitution. There is a need to discuss widely inside and outside of the Parliament as emergency provisions impact the fundamental rights of citizens. There is opposition from pockets of society that lockdown is unconstitutional and there has been criticism of the excessive role of the Central Government in imposing the lockdown . On the other hand, there are Public Interest Petitions (PILs) filed in the Supreme Court to impose a financial emergency under Article 360 of the Indian Constitution. Clarity on the lockdown which restricts the movement of people will impact the fundamental rights enshrined under Article 19 (1)(d) to free movement throughout the territory of India and 19 (1)(e) to reside and settle in any part of the territory of India. Additional opposition to the lockdown order comes from the excessive role of the Central Government in imposing lockdown by declaring the health emergency as a subject of federal units. As COVID‐19 is highly contagious, virulent, and has no boundaries, the coordinated efforts of the union, state, and local governments are crucial in handling this pandemic. With a diverse population and opinions, imposing lockdown will certainly have implications on controlling the pandemic. What one should realize is the right to life, and personal liberty is more important than the freedom of expression during a pandemic situation.

Conclusion

The COVID‐19 pandemic has led to questions about many aspects in India—the quality of healthcare, the response of governments and institutions, and issues related to law and order. The constitutional and legislative framework should help in addressing these questions. The Indian Government effectively imposed the lockdown and reduced the number of cases, while at the same time certain lawmakers and legal experts questioned the constitutional legality of the lockdown and the response of the Government. Though the Central Government has implemented the EDA and the DMA, these are not sufficient to face the health emergency effectively given the dynamic nature of the disease. This paper has explored various options for bridging the gap and strengthening the constitutional and legal framework for addressing any future health emergency. These emergencies will give ample space to fill the lacuna in the legal framework, and allow our future generations to be better prepared for any type of health emergency.

 

Author: Vinay Sachdev

Editor: Adv. Aditya Bhatt & Adv. Chandni Joshi

Covid 19: Need of Comprehensive Healthcare Law in India (Part 1)

Covid 19: Constitutional and legal framework of the management of epidemics and a need of Comprehensive Health care Law in India 

INTRODUCTION

A new coronavirus that causes acute respiratory disease in humans was identified in Wuhan City, Hubei Province of China (WHO, 2020a) in late 2019 and is most commonly referred to as COVID‐19. Coronaviruses are a large family of viruses that cause respiratory infections ranging from the common cold to severe diseases like the 2003 Severe Acute Respiratory Syndrome (SARS) outbreak and the 2011 Middle East Respiratory Syndrome (MERS) outbreak. The Novel Coronavirus (2019—NCoV), the cause of the current outbreak, is the seventh identified member of the family of coronaviruses that infect humans (Zhu et al., 2020). The outbreak in China has now spread across the globe and was officially declared a pandemic by the WHO on March 11, 2020. As of may 13, 2021, there are more than 2 crore confirmed cases and more than 2.5 lakh  deaths in India.

There are numerous hotspots throughout the country, predominantly in urban areas. While the Government has now sealed the areas in these hotspots, the nation also implemented a 21‐day lockdown as a measure to curb the spread of the virus by breaking its chain on March 25, 2020, which was extended until May 3, 2020 by the Narendra Modi Government. As the virus is highly contagious, many countries have implemented similar lockdowns in an attempt to control the spread of the virus as there is currently no vaccination or approved treatment. India also completely closed all kinds of transportation. The COVID‐19 pandemic is a global medical emergency and requires immediate and stringent action by the Government to control human loss. Apart from medical preparedness, legal provisions play a significant role in managing and controlling the disease.Legal Issues Raised by the COVID-19 Pandemic

It is against this background that this paper focuses on identifying the present constitutional and statutory provisions in India that are available to face a health emergency like the COVID‐19 pandemic and identify possible areas for strengthening the legislative structure to face health emergencies in the future. This paper also stresses the need for comprehensive public health law for effective prevention, control, and management of pandemics. Largely, this paper is based on primary sources like laws, statutes, regulations, notices, and court cases related to health and health emergencies in the country. Various acts and laws that are included in this research are the Epidemic Disease Act, 1897 (EDA), the Disaster Management Act, 2005 (DMA) along with bills introduced in parliament and which have lapsed like the National Health Bill (2009) and the Public Health (Prevention, Control, and Management of epidemics, bio‐terrorism, and disasters) Bill, 2017 along with regulations, notices, and guidelines issued during the COVID‐19 crisis by the Central Government along with state governments. 

Health‐related constitutional provisions

The constitutional and legal framework of the management of epidemics and health emergencies has been at the forefront of discussions and debates throughout and outside of the nation since the nationwide lockdown order. The Indian Constitution ensures the Right to Health for all without any discrimination. Article 21 in the Indian Constitution states explicitly the citizen’s fundamental right to life and personal liberty, which can be argued was violated as the country enacted a complete nationwide lockdown. Provisions related to health are mentioned in Part IV of the Constitution in terms of the Directive Principles of State Policy. Article 39(a) mentions the responsibility of the State to provide security to citizens by ensuring the Right to adequate means of Livelihood. Article 39(e) mentions the State’s responsibility to ensure that “health and strength of workers, men, and women and the tender age of children are not abused.” Article 41 imposes a duty on the State to “provide public assistance in cases of unemployment, old age, sickness, and disablement.” Article 42 makes provision to “protect the health of the infant and mother by maternity benefit.” Article 47 is about “raising the level of nutrition and the standard of living of people and improving public health.”

India is a union of 28 states and 8 Union Territories. There is a constitutional distinction between the working rights and responsibilities of the government bodies of the central government and the states and territories. The seventh schedule under Article 246 of the Indian Constitution deals with the division of powers between the Union and the States, and legislation can be made, respectively. The Seventh Schedule contains three lists: the Union List, the State List, and the Concurrent List. The Parliament can make laws on 97 items that are mentioned in the Union List, whereas the state legislatures can make laws related to the 62 items in the State List. The Concurrent List, on the other hand, has subjects over which both Parliament and state legislatures have jurisdiction on 52 items. However, the Constitution gives federal supremacy to Parliament on the Concurrent List items in case of a conflict. Both the Central Government and the states are empowered to make laws related to public health. Items related to public health are mentioned in all three lists of the Indian Constitution. Quarantine, including all issues related to seamen’s and marine hospitals and medical institutions, are mentioned in numbers 28 and 81 of the Union List. The states can make legislation related to “health care, sanitation, hospitals, dispensaries, and prevention of animal diseases” under item six of the State List. The Union and states can make laws related to the health profession and the prevention of the extension from one state to another of infectious or contagious diseases or pests affecting people, animals, or plants under entries 26 and 29 of the Concurrent List. The High‐Level Group (HLG), formed for the health sector by the 15th Finance Commission, recommended moving health subjects to the Concurrent List. It also recommended mentioning the “Right to Health” as the fundamental right.

The Right to Health is not explicitly mentioned in the Indian Constitution as is the Right to Education, but various judgments—Consumer Education and Resource Centre versus Union of India (1995), State of Punjab and others versus Mohinder Singh Chawala (1997) and Paschim Banga Khet Mazdoor Samity versus State of West Bengal (1996) included the Right to Health as part of Article 21 of the Indian Constitution (i.e., Right to Life, and the Government has a constitutional obligation to provide health facilities to citizens). Hence, the role of government at all three levels—Union, State, and local (panchayats and municipalities) level is crucial in providing healthcare to all citizens. However, “health emergency” is not part of the emergency provisions of the Indian Constitution. The Indian Constitution empowers the President of India to declare three kinds of emergencies: national emergency, state emergency, and financial emergency. A national emergency is imposed if the security of the country is threatened on the grounds of war, external aggression, or armed rebellion. A state emergency is imposed if there is a constitutional breakdown in the respective state. A financial emergency is imposed if the financial stability of the country is threatened. As imposing a lockdown or keeping strict measures to contain the spread of disease will impact citizens’ fundamental rights, there is a need to explore various constitutional methods to include health emergencies in the emergency provisions with proper consultations with various stakeholders.

Existing laws for facing health emergencies in India

1. The Epidemic Diseases Act, 1897 (EDA)

The Epidemic Diseases Act, 1897, which was enacted during the British colonial era, was promulgated to tackle the bubonic plague which broke out in the Bombay State (now Maharashtra State). The Act is 125 years old, with only four sections. The law is described as “extraordinary” but “necessary” by John Woodburn, the Council Member of the Governor‐General of India in Calcutta during the discussion on the bill introduced in 1897 and emphasized that people must “trust the discretion of the executive in the grave and critical circumstances’. Hence, any action taken on the grounds of epidemics must take into consideration all grave and critical circumstances. Such decisions may not be opposed by the general public for the “greater good” for all. The law was vital in containing other outbreaks in the country like Cholera (1910), Spanish Flu (1918–20), Smallpox (1974), Swine flu (2014), and the Nipah Virus (2018). The EDA is the only act that provides legal interventions in the case of a national or sub‐national epidemic. The first section gives the title and the extent of the implementation of the act. The second section deals with the power to take special measures and prescribe regulations during times of dangerous diseases by the central and state governments. Under section 2 of the act, the state government may take or empower any person to issue notices or regulations to be observed by people during the outbreak. Section 2A empowers the Central Government to take precautions and issue regulations for the inspection of ships and vessels and also to regulate any person who intends to sail. Penalties are included in the third section, and the fourth section covers the protection of persons acting under the act. The disobedience to the directions of public servants under the act is considered an offense and punishable under section 188 of the Indian Penal Code 45 of 1860 (i.e., imprisonment of 6 months and/or a fine of 1000 rupees).

On April 22, 2020, using the powers under Article 123, the Modi Cabinet issued an ordinance to amend the EDA, as there had been incidents of attacks on health care workers. The ordinance amended section 3 of the EDA. If anyone causes damage or loss to the property, then they may be punished with “imprisonment for a term of 3 months to 5 years and with a fine of Rs. 50,000/‐ to Rs. 200,000/‐.” In case of violence and physical attack on health care workers, they can be imprisoned “for a term of 6 months to 7 years and with a fine of Rs. 100,000/‐ to Rs. 500,000/.” In addition, “the offender shall also be liable to pay compensation to the victim and twice the fair market value for damage to property.”

Telangana, a south Indian State, invoked the EDA by issuing a regulation called “the Telangana Epidemic Disease (COVID‐19) Regulation 2020”. The regulation empowers the Director of Public Health (DPH), the Director of Medical Education, all the District collectors, Commissioner of Police, District Superintendent of Police, and all Municipal Commissioners of Corporations in the State to take measures to control and contain COVID‐19. The regulation brings all hospitals, both public and private, under the purview of the regulations and directs them to report all cases to the State Integrated Surveillance Units and Collector of the District or the Commissioner of Corporations. The empowered officials can take action on persons who refuse to comply with the regulation under Section 188 of the Indian Penal Code. The regulation also prohibits the spread of misinformation on social media and in print media, and necessary action may be taken on violators. Hence, the State Government of Telangana emphasized keeping the institutional structures strong and powerful to contain COVID‐19.

Another south Indian State promulgated the Karnataka Epidemic Diseases, COVID‐19 Regulations, 2020, using the powers under the EDA. The regulations bar private laboratories from conducting COVID‐19 testing. All samples must be collected by the designated laboratory by the District Nodal Officer of the Department of Health and Family Welfare of the concerned district. The samples are collected according to guidelines issued by the Central Government. The interesting point of the regulation is that it makes the District Disaster Management Committee headed by the Deputy Commissioner the main authority for preparing strategies regarding containment measures at the district level. Similarly, many state governments have issued regulations according to their institutional setup and strategized their plans to counter COVID‐19.

Prior to the COVID‐19 pandemic, some state governments had their own public health acts or had amended the EDA to include certain provisions at the state level. The Madras Public Health Act, 1939 in the State of Tamil Nadu, is one example of comprehensive public health law at the state level. The act includes a Public Health Board being constituted at the state level that includes a Minister of Public Health, other coordination ministers, the surgeon general, Director of Health Services, Sanitary Engineer and other members nominated by the state government. The Board’s role is to advise the state government. The act also includes prevention, notification, and treatment of diseases. There is a similar act in the State of Madhya Pradesh, namely the Madhya Pradesh Public Health Act, 1949. In the State of Kerala, the Travancore‐Cochin Public Health Act, 1955 and the Malabar Public Health Act, 1939 are both in place in the case of any major public health issue. The Madhya Pradesh State Government is planning to combine both acts and bring them into a single act for covering the entire state. Compulsory provision of vaccinations is included by the state government of Himachal Pradesh under the Himachal Pradesh Vaccination Act, 1968. Bihar gave the state governments the power to make requests for vehicles during epidemics .

The EDA is not comprehensive and left to state governments to devise their own public health laws. However, only some state governments like Madhya Pradesh and Bihar have their own laws related to public health. Though the EDA has been invoked during the COVID‐19 pandemic by various state governments after directions from the Central Government, there is a need for an integrated, comprehensive, actionable, and relevant legal provision for the control of outbreaks in India. The EDA in the present form is not sufficient to face health emergencies like COVID‐19 as it is silent on technical and operational mechanisms of the control and management of epidemics.

2. Disaster Management Act, 2005

It was the Disaster Management Act under which the nationwide lockdown of 21 days was declared on March 25, 2020 by the Modi Government and was then extended until May 31, 2020. The DMA was enacted in 2005 with the objective “to provide for the effective management of disasters and for matters connected therewith or incidental there to.” The act consists of 79 sections and covers a wide range of issues like the establishment of the National Disaster Management Authority (NDMA), State Disaster Management Authority (SDMA), District Disaster Management Authority (DDMA), measures to be taken by the Governments during the disaster, penalties, and offenses of the violators. The NDMA was established under the act, and the Prime Minister is the ex‐officio Chairperson along with nine other members. Subsequently, a guideline on the Management of Biological Disaster 2008 was passed and currently the NDMA deals extensively with biological disasters and health emergencies.

There are certain sections in the NDMA that helped the Central Government to impose the lockdown and restrict all kinds of transportation in the country. Section 62 of the DMA gives powers to the Central Government to issue directions to all ministries or departments of the Government of India and state/UT governments. On 11 April 2020, the Central Government invoked section 69 of the DMA, which delegated the powers of the Home Secretary to the Secretary, Ministry of Health and Family Welfare for coordinating various activities among ministries and states/UTs. Unlike the other laws, this act “provides for an exhaustive administration set up for disaster preparedness.” Violators are punishable up to 1 year in jail or a fine or both under Sections 51 to 60 of the Act. The law describes the offense as obstructing any officer or employee from performing their duty or refusing to comply with directions. For the better execution of the national lockdown, numerous states likewise summoned section 144 of the Criminal Procedure Code (CPC).

One of the major issues with the DMA is whether epidemic or pandemic can be considered “disaster” as per its definition. Section 2(d) of the DMA States that: “Disaster means a catastrophe, mishap, calamity or grave occurrence in any area, arising from natural or man‐made causes, or by accident or negligence which results in substantial loss of life or human suffering or damage to, and destruction of, property, or damage to, or degradation of, environment, and is of such a nature or magnitude as to be beyond the coping capacity of the community of the affected area.” One can interpret that a health emergency of the kind created by the COVID‐19 pandemic falls under “grave concerns,” but such interpretation will not serve any purpose in effectively managing the epidemic. There are intricacies and technicalities associated with the health emergency that is not covered by this legislation.

3. Other legislative provisions

Terms like “quarantinable disease” and “isolation,” have been defined under the Indian Aircraft (Public Health) Rules, 1954 as “yellow fever, plague, cholera, smallpox, typhus, and relapsing fever” and “when applied to a person or group of persons means the separation of that person or group of persons from other persons, except the health staff on duty, in such a manner as to prevent the spread of infection.” respectively. Along with these, it provides definitions of various other words such as “Health Officer,” “Infected Aircraft,” “Infected Area,” “Infected Person.” Similar restrictions are found under the Indian Port Health Rules, 1955, framed under the Indian Port Act, 1908, for the quarantining and isolation of passenger ships, cargo ships, and cruise ships. It further provides for the provision, which states that the Central Government has the power of inspection of any ship or vessel leaving or arriving at the port at any point of time which comes under its jurisdiction. Similarly, the provisions in the Livestock Importation Act, 1898, cover the issue of quarantine of animals to protect and maintain their good health. Where the word “Quarantine” means “to separate and restrict the movement of healthy animals which may have been exposed to a communicable disease to see if they become ill” while the word “Isolation” means “to separate the ill having communicable disease from those who are healthy.” Later, under the same act, Animal Quarantine and Certification Service Station was created for the same purpose. While the Drugs and Cosmetics Act, 1940 provides provisions related to public health on the grounds of availability of and distribution of vaccines and drugs during an outbreak of dangerous and infectious disease.

A Public Health Bill was introduced in 2009, but it was not passed because many states objected to it as health is a subject under the State List. The bill was extensively drafted and mandated health as a right and also recommended the establishment of a National Public Health Board. The bill also advocated for the convergence of various national, state, district, block, and village level planning and implementation authorities. The redressal and communication mechanisms were also clearly mentioned in the bill. The bill was introduced during the United Progressive Alliance (UPA)—II regime under Manmohan Singh as Prime Minister. Subsequently, in 2017, during the Modi government’s first term, the Public Health (Prevention, Control, and Management of Epidemics, Bio‐fear based oppression, and Disasters) Bill 2017 was introduced, but the bill ultimately faced the same fate as the previous bill. The 2017 bill clearly defines epidemics, isolation, quarantine, public health emergency, and social distancing. Section 3 of the bill gives powers to state/UT, district, and local authorities, whereas section 4 of the bill defines powers of the Central Government in giving directions. Penalties are also high when compared to other acts and bills. Section 14 (1) of the bill repeals the EDA.

Author: Vinay Sachdev

Editor: Adv. Aditya Bhatt & Adv. Chandni Joshi

Are WhatsApp messages admissible in court of law?

Are WhatsApp messages admissible in court of law?

The world around us is continuously evolving. The technology has laid down its foundations in every nook and corner of the world. In the present scenario of our country with ever-expanding technology ambiance, the admissibility of e-evidence has become the most germane issue. The advancement of technology brought a drastic change in the mode of communication of people.

Whatsapp chats, emails, text messages have become a prevalent mode of communication. Nowadays various electronic evidence such as DVD, hard-disk, SMS, mail site, etc is produced as evidence in court.

Applicability of law has to always resonate with technology advancement. The Indian computerized system began with the introduction of the Information Technology Act, 2000. This act inserted section 65A and 65B in the Indian evidence act 1872 which deals with the acceptability of electronic evidence in the court of law.

Admissibility of E-evidence; Are WhatsApp chats and E-mails admissible in Court? - Lawyers Blog Vkeel

Meaning Of Evidence 

The term evidence is defined under section 3 of the Indian evidence act 1872. Section 3 of the act includes the following

  1. Every statement which the court allows to be made by witnesses pertaining to the matter under investigation, such explanations are said to be oral evidence
  2. All documents including e-records produced in the court of law for its inspection, such documents are referred to be as documentary evidence.

Besides this, documentary evidence can be classified into two categories- primary evidence and secondary evidence. As per section 62 of the act, primary evidence means the original copy of the documents produced in the court for review. The legal definition of secondary evidence is given under section 63 of the act.

Secondary evidence is not the original document but those documents referred under section 63. It includes a copy of the original document, certified copies. Though a copy of a copy is not acceptable as evidence, those copies produced by mechanical process and copies of a copy compared with the original are admissible as secondary evidence.

Electronic Evidence 

IT act 2000 was amended in the year 2016 to include digital/electronic evidence as admissible evidence. Section 2 (1) (t) of the above act gives the legal definition of the electronic record. The electronic record refers to data, data produced image or sound, and any document sent or received in electronic form or computer-generated electronic data. Electronic data that is transmitted or stored digitally is admissible under section 63 of IEA as secondary evidence.

Section 64 of the act mandates that the content of documents should be proved by primary evidence but section 65 lists few exceptions to it. Section 65 clause (a)(c) and (d) provides for the circumstances where secondary evidence pertaining to the documents is held to be admissible. As per section 65-A, the content of the e-record has to be proved according to the guidelines laid down in section 65-B.

 

Section 65A-B is special legislation different from the documentary evidence procedure laid down in sections 63 and 65.  As per these sections, if the conditions listed below are complied by, then the data stored in electronic form which is printed/copied/stored or created by computer would be regarded as a document. Such documents would be admissible in the court of law without the need for an original copy or direct evidence. 

Conditions for admissibility of computer-outputs are listed in section 65-B (2)- 

  • The computer from which information of electronic record is obtained should have been regularly in use to save/process information for a regular activity carried by an individual having lawful control over it.
  • During feeding of information, the computer should have been working properly
  • Information in electronic-record should be of such nature that it is on a regular-basis fed into the computer during ordinary-activities.
  • Information contained in electronic-record should be a derivation or reproduction of the information stored/fed into the computer

Section 65-B(4) lists the conditions which need to be followed to record statement pertaining to the electronic record-

  • There has to be a certificate that recognizes the electronic record which contains the statement. That certificate –
  • Should describe the manner through which electronic-record is produced.
  • Mention all particulars of the device involved in such production
  • Should take care of conditions of Sec-65B(4)(explained above)
  • Signed by the responsible official which dealt with the operation of that device
  • Such certificate should also accompany the electronic record, for instance, computer printouts pertaining to which statement is sought to be given in evidence

Such safeguards need to be taken while dealing with electronic-evidence to ensure its authenticity.

Judicial Precedents Over Admissibility Of Electronic Records

The court in State (NCT of Delhi) v. Navjot Sandhudealt with the issue of admissibility of evidence of call records. The accused questioned the authenticity of the evidence and alleged that such evidence shouldn’t be held admissible as procedure laid down in section 65B clause 4 was not followed.

The court held evidence of call records to be admissible as they were taken from the computer by a mechanical procedure and certified by an official. The court observed that irrespective of following the conditions laid down in section 65B, a person is not proscribed to adduce secondary evidence under sections 63 and 65 of the Indian evidence act. The court held that merely because conditions of section 65B(4) are not fulfilled, that doesn’t bar adducing the same evidence under other provisions of the act.

Whether WhatsApp chats are primary evidence or secondary evidence?

In the case of Girwar Singh v. CBI, the court-appointed a committee to examine the veracity and authenticity of electronic evidence. It was found that the evidence submitted to the court was not a copy of the original document, but it was copied multiple times and on various devices. The court ruled that in this case, e-evidence was inadmissible.

Similarly, in the case of Vikas Garg v state of Haryana, the trial court relied on WhatsApp conversation to convict the accused of the offence of rape. Later on, Punjab and Haryana high court ignored the chats which were incontestable evidence of rape and abuse of the victim. Supreme Court stayed the bail application of the accused and the matter is still pending in the court.

Whether the condition of certificate u/s 65-B(4) mandatory?

Anvar P.V. Versus P.K. Basheer is one of the important judgments where the court discussed several issues regarding the admissibility of electronic evidence in the court of law. The court observed that secondary evidence stored in CD/DVD/drive is inadmissible u/s 65A and 65B unless it complies with the condition of the certificate mentioned in section 65-B (4).

Conditions mentioned in section 65-B(4) discussed above are necessary to comply to ensure the authenticity of the electronic evidence. The court further held that e-evidence submitted without certificate can’t be held admissible by oral evidence and not even by the statement of experts under section 45A of the act.

Electronic records could easily be affected, tampered with, changed, transposed, or damaged and so forth without such safeguards, the entire trial dependent on verification of electronic records can eventually lead to injustice. The court, in this case, ruled that secondary evidence of electronic evidence shall be entirely governed by section 65A-B of the act, and sections 63 and 65 have application in such cases.

In contrast to Anvar case the court relaxed the certificate condition of section 65-B(4) in case Shafi Mohammad v. Territory of H.P [5] in certain scenarios – a) when the device from which the document is produced is not in the possession of the party b) this condition being a procedural one could also be relaxed in the interest of justice.

The two contrasting positions regarding certificate were finally settled in Arjun Panditrao Khotkar v. Kailash Kushanrao Gorantyal & Ors[6]. The court held that the condition of the certificate mentioned under section 65B (4) is mandatory for secondary evidence of electronic data to be admissible in court.

The court further reasoned that this condition is redundant if the original document is itself produced. If the device in which the original information is first stored is brought in the court, compliance with the conditions of section 65-B (4) is not necessary.

Few conditions to be satisfied for admissibility of WhatsApp chats as secondary evidence

As held in various Indian high courts, WhatsApp chats are considered to be electronic evidence and are admissible in court if the following conditions are satisfied-

  • The receiver should have received the message.
  • Cell phones should not have been damaged.
  • The sender should have the mens rea to send those messages.

Significance of blue ticks

In SBI cards and payment services Pvt. Ltd. v. Rohit Jadhav the court observed that if blue ticks are seen over the messaging app, it would be conclusive proof that the receiver has received the message and it would be considered legitimate evidence.

In another case Shamsudin Bin Mohd. Yosuf v. Suhaila Binti Sulaiman, the high court held that even in the case where most of the communication takes place on WhatsApp, there was an oral valid agreement between the parties. 

Conclusion

Whatsapp chats are admissible as secondary evidence in the court of law if certain conditions as discussed above are satisfied. The Judiciary’s stance over the admissibility of electronic evidence is to ensure its credibility and evidentiary value as such evidence could be easily damaged or tampered with.

This progressive stance of courts is the outcome of recognizing the nature of the e-record itself. Current legislation and precedents regarding the admissibility of electronic evidence present a myriad of issues that still remains unresolved. Issues pertaining to the procedure of preserving them, ascertaining their veracity, finding original authors, retrieving them, are still being debated and a progressive precedent in this penumbral area is awaited.

The jurisprudence over the admissibility of electronic evidence is still in its nascent stage even after two decades since the IT act of 2000 was passed. The applicability of laws should resonate with the development of technology. It is expected that in recent years the present lacuna in law would be addressed by amendments and progressive judgments.

Difference Between Operational And Financial Creditors

Difference Between Operational And Financial Creditors

INTRODUCTION.

“creditor” means any person to whom a debt is owed and includes a financial creditor, an operational creditor, a secured creditor, an unsecured creditor and a decree holder”

The Insolvency and Bankruptcy Code, 2016 differentiates between financial creditors and operational creditors. Financial Creditors are those whose relationship with the entity is a pure financial contract, such as a loan or a debt security. Operational creditors are those whose liability from the entity comes from a transaction on operations. 

Creditors

The Insolvency and Bankruptcy Code, 2016 (IBC) has consolidated and amended the laws relating to reorganization and insolvency of corporate persons, partnership firms and individual firms. The sole intention of this legislation is to facilitate resolution of corporate bankruptcy in a time bound manner.  The IBC has introduced new and distinct concepts of ‘Financial Creditor’ and ‘Operational Creditor‘ as opposed to the Companies Act, 2013 which merely introduced the term ‘creditor’, without any classification thereof.

Today, the maintainability of applications for initiating corporate insolvency resolution process chiefly depends on the applicant first satisfying the Tribunal that it falls either within the definition of ‘Financial Creditor’ or ‘Operational Creditor’ under the IBC. In this article, we are particularly discussing the Order dated 20th February 2017 passed by the Hon’ble National Company Law Tribunal, Principal Bench, New Delhi in Col. Vinod Awasthy v. AMR Infrastructure Limited1 whereby the Hon’ble Tribunal interpreted the definition of ‘Operational Creditor’ under the IBC to ascertain the applicability of the same to a flat purchaser.

Prior to discussing the aforesaid Order, it is imperative to first understand the definitions of ‘Financial Creditor’ and ‘Operational Creditor’ under the IBC.

A financial creditor is defined under Section 5(7) of the IBC to mean

a person to whom a financial debt is owed and includes a person to whom such debt has been legally assigned or transferred“.

An operational creditor is defined under Section 5(20) of the IBC to mean

any person to whom an operational debt is owed and includes any person to whom such debt has been legally assigned or transferred“.

In order to ascertain whether a person would fall within the definition of an operational creditor, the debt owed to such a person must fall within the definition of an operational debt as defined under Section 5(21) of the IBC.

Difference by the bankruptcy law 

Distinction between a financial creditor and operational creditor has been drawn by the Bankruptcy Law Reforms Committee in para 5.2.1 of its final report. It states:

Here, the Code differentiates between financial creditors and operational creditors. Financial creditors are those whose relationship with the entity is a pure financial contract, such as a loan or debt security. Operational creditors are those whose liabilities from the entity comes from a transaction on operations…The Code also provides for cases where a creditor has both a solely financial transaction as well as an operational transaction with the entity. In such a case, the creditor can be considered a financial creditor to the extent of the financial debt and an operational creditor to the extent of the operational debt.”

It is clearly evident that the lawmakers have chalked out distinct definitions of ‘financial creditor’ and ‘operational creditor’ and that they are not to be interpreted as inclusive or exclusive of each other.

Detailed differences between Financial Creditor and Operational Creditor

 

particulars.Financial Creditor.Operational Creditor.
Meaning Section 5 (7) – Financial creditor

means any person to whom a financial debt is owed and includes a person to whom such debt has been legally assigned or transferred to.

Section 5 (20) – Operational

creditor means a person to whom

an operational debt is owed and includes any person to whom such debt has been legally assigned or

transferred.

Voting shareSection 5 (28) – Voting right of a

financial creditor is based on

the proportion of the financial

debt owed to such a financial creditor. The approval of

committee of creditor shall be

obtained by a vote of not less than

seventy five percent of the voting shares. 

Operational creditor shall not have

any right to vote at the meeting

of committee of creditors. 

Initiation of corporate

insolvency resolution

process

Section 7 (1) – On occurrence of a

default, a financial creditor shall

either by itself or jointly with other

financial creditors may file an

application for initiating corporate

insolvency resolution process

against a corporate debtor before

the Adjudicating Authority

Section 8 (1) – On occurrence of a

default the operational creditor

may, deliver a demand notice of

unpaid operational debtor copy of

an invoice demanding payment of

the amount involved in the default

to the corporate debtor. The

operation creditor may file an

application after the expiry of 10

days from the date of delivery of

the notice or invoice demanding

payment under sub-section (1) of

section 8, if the operational

creditor does not receive payment

from the corporate debtor or

notice of the dispute under subsection (2) of section 8. 

Appointment of IRPSection 7 (3) – The financial

creditor shall along with the

application furnish the name of the

resolution professional proposed

to act as an interim resolution

professional. 

Section 9 (4) – An operational

creditor may propose a resolution

professional to act as an

 interim resolution

professional. 

Constitution of

Committee of Creditors

Section 21 (2) – The committee of

creditors shall consist solely of

financial creditors, and all financial

creditors of the corporate debtor. 

Operational creditors shall not

form part of the committee. 

 

Hon’ble National Company Law Tribunal on ‘Operational Creditors’

In Col. Vinod Awasthy v. AMR Infrastructure Limited, the Hon’ble Tribunal while dismissing the Petition instituted under Section 9 of the Insolvency and Bankruptcy Code, 2016 (IBC) at the admission stage itself, decided the issue of whether a flat purchaser would fall within the definition of an ‘Operational Creditor‘ as defined under Section 5(20) of the IBC to whom an ‘Operational Debt’ as defined under Section 5(21) of the IBC is owed.

The Hon’ble Tribunal observed that the framers of the IBC had not intended to include within the expression of an ‘operation debt’ a debt other than a financial debt. Therefore, an operational debt would be confined only to four categories as specified in Section 5(21) of the IBC like goods, services, employment and Government dues. The Tribunal held that the debt owed to the Petitioner (a flat purchaser in this case) had not arisen from any goods, services, employment or dues which were payable under any statute to the Centre / State Government or local bodies. Rather, the refund sought to be recovered by the Petitioner was associated with the possession of immovable property.

The Hon’ble Tribunal while deciding the question of whether a flat purchaser could be considered an operation creditor considered the observations of the Bankruptcy Law Reforms Committee in paragraph no. 5.2.1 of the Final Report:

“Operational Creditors are those whose liability from the entity comes from a transaction on operations. Thus, the wholesale vendor of spare parts whose spark plugs are kept in inventory by car mechanics and who gets paid only after the spark plugs are sold is an operational creditor. Similarly, the lessor that the entity rents out space from is an operational creditor to whom the entity owes monthly rent on a three-year lease.”

The Hon’ble Tribunal held that the Petitioner had neither supplied goods nor had rendered any services to acquire the status of an ‘Operational Creditor’.

It was further held that it was not possible to construe Section 9 read with Section 5(20) and Section 5(21) of the IBC so widely to include within its scope, cases where dues were on account of advance made to purchase a flat or a commercial site from a construction company like the Respondent especially when the Petitioner had other remedies available under the Consumer Protection Act and the General Law of the land.

Supreme Court’s View

The difference between financial and operational creditors under the Code is not merely surficial – it is fundamental. If the crux of the insolvency regime is priorities, the priorities of the two in the distribution waterfall differ, even if both are unsecured. Is this a differentiation, or discrimination?  The differentiation, along with certain other provisions of the Code, was challenged before the Supreme Court in a bunch of petitions. 

In Swiss Ribbons Ltd. v. Union of India, the Supreme Court observed that :

“A perusal of the definition of ‘financial creditor’’ and ‘financial debt’ makes it clear that a financial debt is a debt together with interest, if any, which is disbursed against the consideration for time value of money. It may further be money that is borrowed or raised in any of the manners prescribed in Section 5(8) or otherwise, as Section 5(8) is an inclusive definition. On the other hand, an ‘operational debt’ would include a claim in respect of the provision of goods or services, including employment, or a debt in respect of payment of dues arising under any law and payable to the Government or any local

authority.” And, “financial creditors generally lend finance on a term loan or for working capital that enables the corporate debtor to either set up and/or operate its business. On the other hand, contracts with operational creditors are relatable to supply of goods and services in the operation of business. Financial contracts generally involve large sums of money. By way of contrast, operational contracts have dues whose quantum is generally less.” The difference between operational and financial debt/creditors was thus upheld by the Supreme Court. The most important consideration in determining whether a debt is a financial debt or an operational debt is to “intent of the parties”. Merely because a creditor claims interest for a delayed payment, does not imply that the debt is financial – in such transactions, interest is contemplated as a ‘penalty’ and not ‘returns’. Also, lending for time value of money does not necessarily involve ‘interest’. In order to qualify to be a financial debt, what matters is that the amount was disbursed against time value of money, whether or not expressed in terms of ‘interest’. Besides financial and operational debts, there can be other types of debts too – however, such other creditors are not entitled to initiate an application under the Code, but can file claims in the specified form.

 

OFFENCES/PENAL PROVISIONS UNDER CENTRAL GOODS AND SERVICES TAX ACT (CGST), 2017

OFFENCES/PENAL PROVISIONS CENTRAL GOODS AND SERVICES TAX ACT (CGST), 2017

The Act, declares the offences that attract penalty as a consequence, apart from the requirement to pay the tax and applicable interest. Some of the offences listed under this Act, may also attract prosecution but that depends on the gravity of the offence defined in that section.

Surat CGST arrested two for fraud through non existing and bogus firms

 

OFFENCES/PENAL PROVISIONS

S.132(1)(i): Amount exceeding five hundred lakh rupees:

SR. NO.OFFENCEPUNISHMENTCOGNIZABLE AND NON-BAILABLE

OR

NON-COGNIZABLE AND BAILABLE

1.Supply without invoice:

Supplies any goods or services or both without issuing any invoice with the intention of evading tax amount exceeding five hundred lakh rupees(S.132(1)(a)(i))

Imprisonment for a term which may extend to 5 years + fine Cognizable and Non-bailable

S.132(5)

2.Invoice or bill without supply:

Issues any invoice or bill without supplying goods or services or both leading to wrongful availment or utilisation of input tax credit or refund of tax amount exceeding the amount of five hundred lakh rupees(S.132(1)(b)(i))

Imprisonment for a term which may extend to 5 years + fine Cognizable and Non-bailable

S.132(5)

3.Input tax credit from an invoice aforementioned:

Availing input tax credit amount exceeding five hundred lakh rupees using an invoice or bill for which the goods or services or both has not been supplied. (S.132(1)(c)(i))

Imprisonment for a term which may extend to 5 years + fine Cognizable and Non-bailable

S.132(5)

4.Failing to pay collected tax:

Collects any amount exceeding five hundred lakh rupees as tax but fails to pay the same to the Government beyond a period of three months from the date on which such payment is due. (S.132(1)(d)(i))

Imprisonment for a term which may extend to 5 years + fine Cognizable and Non-bailable

S.132(5)

5.Evasion/fraudulent availment/fraudulent refund:

Evasion of tax, fraudulently availing input tax credit or fraudulently obtains refund for an amount exceeding five hundred lakh rupees and such offence is not covered under s.132(1)(a)-(d) (S.132(1)(e)(i))

Imprisonment for a term which may extend to 5 years + fine Non-cognizable and bailable

S.132(4)

6.Goods liable to be Confiscated:

Acquiring possession of, or in any way concerns himself in transporting, removing, depositing, keeping, concealing, supplying, or purchasing or in any other manner deals with, any goods which he knows or has reasons to believe are liable to confiscation under CGST Act and uses it for tax evasion/wrongfully availing or utilising input tax credit/ wrongfully taking refund of amount exceeding five hundred lakh rupees.  (S.132(1)(h)(i))

Imprisonment for a term which may extend to 5 years + fine Non-cognizable and bailable

S.132(4)

7.Contravened Services:

Receives or is in any way concerned with the supply of, or in any other manner deals with any supply of services which he knows or has reasons to believe are in contravention of any provisions of CGST Act and uses it for tax evasion/wrongfully availing or utilising input tax credit/ wrongfully taking refund of amount exceeding five hundred lakh rupees (S.132(1)(i)(ii))

Imprisonment for a term which may extend to 5 years + fine Non-cognizable and bailable

S.132(4)

8.Failed Information Supply/False Information:

Fails to supply any information which he is required to supply under CGST Act or (unless with a reasonable belief, the burden of proving which shall be upon him, that the information supplied by him is true) supplies false information which makes it a case of tax evasion/wrongfully availing or utilising input tax credit/ wrongfully taking refund of amount exceeding five hundred lakh rupees (S.132(1)(k)(i))

Imprisonment for a term which may extend to 5 years + fine Non-cognizable and bailable

S.132(4)

9.Attempt/abet to commit: Anyone who attempts to commit or abets to commit the aforementioned offences for purposes of tax evasion wrongfully availing or utilising input tax credit/ wrongfully taking refund of amount exceeding five hundred lakh rupees. (S.132(1)(l)(i))Imprisonment for a term which may extend to 5 years + fine Non-cognizable and bailable

S.132(4)

 

S.132(1)(ii):Amount exceeding two hundred lakh rupees but less than five hundred lakh rupees

SR. NO.OFFENCEPUNISHMENTCOGNIZABLE AND NON-BAILABLE

OR

NON-COGNIZABLE AND BAILABLE

1.Supply without invoice:

Supplies any goods or services or both without issuing any invoice with the intention of evading tax amount exceeding two hundred lakh rupees but less than five hundred lakh rupees (S.132(1)(a)(ii))

Imprisonment for a term which may extend to 3 years + fine Non-cognizable and bailable

S.132(4)

2.Invoice or bill without supply:

Issues any invoice or bill without supplying goods or services or both leading to wrongful availment or utilisation of input tax credit or refund of tax amount exceeding two hundred lakh rupees but less than five hundred lakh rupees (S.132(1)(b)(ii))

Imprisonment for a term which may extend to 3 years + fine Non-cognizable and bailable

S.132(4)

3.Input tax credit from an invoice aforementioned:

Availing input tax credit of an amount exceeding two hundred lakh rupees but less than five hundred lakh rupees, using an invoice or bill for which the goods or services or both has not been supplied. (S.132(1)(c)(ii))

Imprisonment for a term which may extend to 3 years + fine Non-cognizable and bailable

S.132(4)

4.Failing to pay collected tax:

Collects any amount exceeding two hundred lakh rupees but less than five hundred lakh rupees as tax but fails to pay the same to the Government beyond a period of three months from the date on which such payment is due. (S.132(1)(d)(ii))

Imprisonment for a term which may extend to 3 years + fine Non-cognizable and bailable

S.132(4)

5.Evasion/fraudulent availment/fraudulent refund:

Evasion of tax, fraudulently availing input tax credit or fraudulently obtains refund for an amount exceeding two hundred lakh rupees but less than five hundred lakh rupees and such offence is not covered under s.132(1)(a)-(d) (S.132(1)(e)(ii))

Imprisonment for a term which may extend to 3 years + fine Non-cognizable and bailable

S.132(4)

6.Goods liable to be Confiscated:

Acquiring possession of, or in any way concerns himself in transporting, removing, depositing, keeping, concealing, supplying, or purchasing or in any other manner deals with, any goods which he knows or has reasons to believe are liable to confiscation under CGST Act and uses it for tax evasion/wrongfully availing or utilising input tax credit/ wrongfully taking refund of amount exceeding two hundred lakh rupees but less than five hundred lakh rupees.  (S.132(1)(h)(ii))

Imprisonment for a term which may extend to 3 years + fine Non-cognizable and bailable

S.132(4)

7.Contravened Services:

Receives or is in any way concerned with the supply of, or in any other manner deals with any supply of services which he knows or has reasons to believe are in contravention of any provisions of CGST Act and uses it for tax evasion/wrongfully availing or utilising input tax credit/ wrongfully taking refund of amount exceeding two hundred lakh rupees but less than five hundred lakh rupees.  (S.132(1)(i)(ii))

Imprisonment for a term which may extend to 3 years + fine Non-cognizable and bailable

S.132(4)

8.Failed Information Supply/False Information:

Fails to supply any information which he is required to supply under CGST Act or (unless with a reasonable belief, the burden of proving which shall be upon him, that the information supplied by him is true) supplies false information which makes it a case of tax evasion/wrongfully availing or utilising input tax credit/ wrongfully taking refund of an amount exceeding two hundred lakh rupees but less than five hundred lakh rupees. (S.132(1)(k)(ii))

Imprisonment for a term which may extend to 3 years + fine Non-cognizable and bailable

S.132(4)

9.Attempt/abet to commit: Anyone who attempts to commit or abets to commit the aforementioned offences for purposes of tax evasion wrongfully availing or utilising input tax credit/ wrongfully taking refund of amount exceeding two hundred lakh rupees but less than five hundred lakh rupees. (S.132(1)(l)(ii))Imprisonment for a term which may extend to 3 years + fineNon-cognizable and bailable

S.132(4)

 

S.132(1)(iii):Amount ranging from one hundred lakh rupees to two hundred lakh rupees

SR. NO.OFFENCEPUNISHMENTCOGNIZABLE AND NON-BAILABLE

OR

NON-COGNIZABLE AND BAILABLE

1.Supply without invoice:

Supplies any goods or services or both without issuing any invoice with the intention of evading tax amount ranging from one hundred lakh rupees to two hundred lakh rupees(S.132(1)(a)(iii))

Imprisonment for a term which may extend to 1 year + fine Non-cognizable and bailable

S.132(4)

2.Invoice or bill without supply:

Issues any invoice or bill without supplying goods or services or both leading to wrongful availment or utilisation of input tax credit or refund of tax amount ranging from one hundred lakh rupees to two hundred lakh rupees(S.132(1)(b)(iii))

Imprisonment for a term which may extend to 1 year + fine Non-cognizable and bailable

S.132(4)

3.Input tax credit from an invoice aforementioned:

Availing input tax credit amount ranging from one hundred lakh rupees to two hundred lakh rupees using an invoice or bill for which the goods or services or both has not been supplied. (S.132(1)(c)(iii))

Imprisonment for a term which may extend to 1 year + fine Non-cognizable and bailable

S.132(4)

4.Failing to pay collected tax:

Collects any amount ranging from one hundred lakh rupees to two hundred lakh rupees as tax but fails to pay the same to the Government beyond a period of three months from the date on which such payment is due. (S.132(1)(d)(iii))

Imprisonment for a term which may extend to 1 year + fine Non-cognizable and bailable

S.132(4)

5.Evasion/fraudulent availment/fraudulent refund:

Evasion of tax, fraudulently availing input tax credit or fraudulently obtains refund for an amount ranging from one hundred lakh rupees to two hundred lakh rupees and such offence is not covered under s.132(1)(a)-(d) (S.132(1)(e)(iii))

Imprisonment for a term which may extend to 1 year + fine Non-cognizable and bailable

S.132(4)

6.Goods liable to be Confiscated:

Acquiring possession of, or in any way concerns himself in transporting, removing, depositing, keeping, concealing, supplying, or purchasing or in any other manner deals with, any goods which he knows or has reasons to believe are liable to confiscation under CGST Act and uses it for tax evasion/wrongfully availing or utilising input tax credit/ wrongfully taking refund of amount ranging from one hundred lakh rupees to two hundred lakh rupees.  (S.132(1)(h)(iii))

Imprisonment for a term which may extend to 1 year + fine Non-cognizable and bailable

S.132(4)

7.Contravened Services:

Receives or is in any way concerned with the supply of, or in any other manner deals with any supply of services which he knows or has reasons to believe are in contravention of any provisions of CGST Act and uses it for tax evasion/wrongfully availing or utilising input tax credit/ wrongfully taking refund of amount ranging from one hundred lakh rupees to two hundred lakh rupees (S.132(1)(i)(iii))

Imprisonment for a term which may extend to 1 year + fine Non-cognizable and bailable

S.132(4)

8.Failed Information Supply/False Information:

Fails to supply any information which he is required to supply under CGST Act or (unless with a reasonable belief, the burden of proving which shall be upon him, that the information supplied by him is true) supplies false information which makes it a case of tax evasion/wrongfully availing or utilising input tax credit/ wrongfully taking refund of amount ranging from one hundred lakh rupees to two hundred lakh rupees. (S.132(1)(k)(iii))

Imprisonment for a term which may extend to 1 year + fine Non-cognizable and bailable

S.132(4)

9.Attempt/abet to commit: Anyone who attempts to commit or abets to commit the aforementioned offences for purposes of tax evasion wrongfully availing or utilising input tax credit/ wrongfully taking refund of amount ranging from one hundred lakh rupees to two hundred lakh rupees(S.132(1)(l)(iii))Imprisonment for a term which may extend to 1 year + fine Non-cognizable and bailable

S.132(4)

 

S.132(1)(iv): Commission or abets commission of three particular offences

SR. NO.OFFENCEPUNISHMENTCOGNIZABLE AND NON-BAILABLE

OR

NON-COGNIZABLE AND BAILABLE

1.False/fake documents:

Anyone who falsifies or substitutes financial records or produces fake accounts or documents or furnishes any false information with an intention to evade payment of tax due under CGST Act

Imprisonment for a term which may extend to 6 months or/and with fineNon-cognizable and bailable

S.132(4)

2.Obstructing/preventing officer:

Anyone who obstructs or prevents any officer in the discharge of his duties under CGST Act

Imprisonment for a term which may extend to 6 months or/and with fineNon-cognizable and bailable

           S.132(4)

3.Tamper/destroy evidence: Anyone who tampers or destroys material evidence or documentsImprisonment for a term which may extend to 6 months or/and with fineNon-cognizable and bailable

           S.132(4)