“Coercion” defined – “Coercion” is the committing, or threatening to commit any act forbidden by the Indian Penal Code, or the unlawful detaining, or threatening to detain, any property, to the prejudice of any person whatever, with the intention of causing any person to enter into an agreement. (45 of 1860).
Explanation.- It is immaterial whether the Indian Penal Code is or is not force in the place where the coercion is employed. (45 of 1860).
Coercion as defined under Section 15. It corresponds with most part with ‘Duress’, known to English Law.
Coercion comprises of the following two elements :
Committing or threatening to commit an act which is contrary to law with the intention of causing any person to enter into an agreement ;
Which compels an individual to act in an involuntary manner.
In case a contract is entered into by coercion, the contract shall be voidable under Section 19 of the Indian Contract Act, 1872.
Also, in case certain money has been paid or goods been delivered by the party to the contract under coercion, the same is recoverable under Section 72 of the Act.
Coercion: Voidable Contract
To cause any person to enter into an agreement is not necessary. It has been held in Purushottam Daji Mandalik v. Pandurang Chintaman Biwalkar[1] Plaintiff sued the defendant to set aside a sale-deed on he ground of coercion under Section 39 of the Specific Relief Act, 1963. Particulars of the coercion alleged were given in the plaint and further elucidated in the plaintiff’s deposition and supported by definite willingness to the effect that here has been open and violent abduction and severe beating to procure signature of the document. The contract was declared voidable.
Burden of Proof
The invalidating circumstances, which allege coercion must be stated by the party relying on the defence of coercion. Therefore, the aggrieved party which wants to set aside the contract will have to establish that the consent was obtained by coercion.
Duress
What the India Law calls coercion is called in English duress or menace. Duress is said to consist in actual or threatened violence or imprisonment of the contracting party or his wife, parent or child, inflicted or threatened by the other party or by one acting with his knowledge and for his advantage. Duress must be such as to cause immediate violence and also to unnerve a person with ordinary firmness of mind.
Test for Duress
The person who applies pressure to extract a promise from another is not allowed to excuse his wrongful behavior by using other reasons which the victim may have had for making the promise. In the case of Barton v. Armstrong[2], where the Court observed that it is enough that the pressure “was a reason (not the reason, nor the predominant reason nor the clinching reason) why the complainant acted the way he did.” In this case: A exerted pressure on B by threatening to kill B if he did not enter the agreement. There were other commercial reasons which might have induced B to enter into the agreement even in the absence of the threats from A. It was held that it was enough that A’s threat was a reason that contributed to the decision to enter into the agreement. It was not necessary to show that it was the prime reason.
DIFFERENCE BETWEEN COERCION AND DURESS
Coercion in India means committing or threatening to commit an act forbidden by the Indian Penal Code, duress under common law, consists in actual violence or threat of violence to a person. It includes doing of an illegal act against a person, whether it be a crime or a tort. Unlike coercion, duress is not confined to unlawful acts forbidden by any specific penal law like the Indian Penal Code in India.
Detaining a property or threatening to detain any property is also covered within the definition of coercion whereas duress is constituted by acts or threats against the person and not against his property.
India, coercion may proceed from a person who is not a party to the contract, and it may also be directed against a person who, against, may be a stranger to contract i.e. a third party.
Duress does not cover acts done by a party to the contract, or a person stranger to contract. In England, duress should proceed from a party to the contract and is also directed against the party to the contract himself, or his wife, parent, child, or other near relative.
As said by Aristotle, “All constitutions have three elements, concerning which the good lawgiver has to regard what is expedient for each constitution. When they are well-ordered, the constitution is well-ordered, and as they differ from one another, constitutions differ. There is one element which deliberates about public affairs; secondly that concerned with the magistrates- the question being, what they should be, over what they should exercise authority, and what should be the mode of electing to them; and thirdly that which has judicial power.”[1]
Separation of power basically means distribution of the powers and authority as well as responsibilities and duties amongst the three pillars of our nation that is, the executive, the legislature and the judiciary. It deals with the function of each organ of the state and its inference on other organ. India is a quasi-federal country.
MEANING
The French thinker Montesquieu stated, early in eighteenth century, that moving power in the hands of only one organ or group of the government is tyrannical. In order to address this problem, he felt that the solution would be to place power in three separate three arms of government, namely the legislature, the executive and the judiciary. This would make it possible for each body to be autonomous of the other in such a way that there can be no encroachment or overlapping of powers and that there could be harmony that would help the smooth functioning of the government.
These words state the Doctrine of Separation of Powers as given by Montesquieu, “There would be an end of everything, were the same man or same body, whether of the nobles or of the people, to exercise those three powers, that of enacting laws, that of executing laws, that of executing public resolutions, and of trying the causes of individuals.”
Understanding that the function of a government is to safeguard individual rights but recognizing that governments have traditionally been the principal violators of such rights, a number of measures to reduce that likelihood have been developed. One such measure is of the separation of powers.
The premise behind Separation of Powers is that if a single person or community has a considerable amount of control, they can become harmful to the general public. Separation of powers is a way to minimize the momentum of power in the hands of any group, making abuse and arbitrariness more difficult to be brought into practice. It is generally accepted that there is a tripartite structure of government authority and power:
(i) Legislature (ii) executive (iii) judiciary.
As per the theory of the separation of powers these three powers and functions of the government must always be kept separate in a free democracy, exercised by separate Government organs.
DOCTRINE OF SEPARATION OF POWERS
As explained by Wade and Philips, The Doctrine of Separation of Powers indicates 3 features to showcase the Powers of Government:
I. The same person should not form part of more than one of the three organs (i.e. Executive, Legislature and Judiciary) of the Government. For example, ministers should not sit in Parliament.
II. One organ of the Government should not control or interfere with any other organ of the Government in carrying out its functions. For example, judiciary should not be independent of executive.
III. One organ of the Government should not exercise the functions dispensed to any other organ. For example, ministers cannot be the part of law making body.
Separation of powers means delegation of powers for certain specified functions of the government. All the powers of the government have been conceived as falling within one or another of given three modules-
(1) The enactment of creation of laws
(2) The interpretation of the laws made
(3) The enforcement of those laws
Namely, legislative, judicial and executive. Government has been reckoned to be made up of tripartite structure having for their functions and such classification is known as classical division.
IMPORTANCE
As it is a very generally accepted fact that whenever a huge amount of power is given in the hand of any administering authority there are higher probabilities of corruption, maladministration and misuse of power. This doctrine aids in preventing the abuse of power. This doctrine shields the individual from the arbitrary rule. The government is the violator and also safeguards individual liberty.
Basically, the importance can be summarized in the following points:
Terminating the authoritarianism, it safeguards the liberty of an individual.
It not only protects the liberty of the individual but also preserves the efficiency of the administration.
Focus on the requirement of independence of the judiciary
Prevent the legislature from enacting an arbitrary rule.
THE TRIPARTITE STRUCTURE
Model is divided into three branches of state. All have separate powers and responsibilities but are inter dependent on each other. Let’s know about these branches in brief.
Legislature:
It is the law making body of the country.
It is the basis for the functioning of the other two organs, the executive and the judiciary.
It is also sometimes accorded the first place among the three organs because until and unless laws are enacted, there can be no implementation and application of laws.
Executive:
The executive is the organ that implements the laws enacted by the legislature and enforces the will of the state.
It is the administrative head of the government.
Ministers including the Prime/Chief Ministers and President/Governors form part of the executive.
Judiciary:
The judiciary is that branch of the government that interprets law, settles disputes and administers justice to all citizens.
The judiciary is considered the watchdog of democracy, and also the guardian of the Constitution.
It comprises of the Supreme Court, the High Courts, District and other subordinate courts.
INDIAN CONSTITUTION AND SEPARATION OF POWERS
The doctrine of separation of powers is not accorded a constitutional status. Apart from the Directive principles laid down in Article 50 which enjoins separation of judiciary from the executive, the constitutional scheme does not embody any formalistic and dogmatic division of powers. In India we have parliamentary form of government where executive is very important part of legislature. We don’t follow this doctrine with rigidity but then the essential functions have been sufficiently differentiated and it is an assumption that one organ of the state will not perform the functions of another organ of the state. Every organ of the state has to perform the essential functions, i.e. the legislature must legislate, the executive must execute and the judiciary must adjudicate.
CONCLUSION
There is no clear difference between executive and legislative forms of government: the legislation that is enacted must always be enforced and executed, and a great deal of executive intervention involves new legislation. Although, judiciary is an independent body.
As such, division can be said to be an artificial division. This is borne out by the fact that there is presently no constitutional system with a comprehensive separation of powers where there is a distribution of the three functions between three independent bodies without overlapping or cross-coordination.
In tort, the liability of a person generally emanates from his negligence and therefore, if the person can be proved negligent then he is held liable. But this general principle of liability does not apply to any person who keeps hazardous substances in his premises or involves in hazardous activities. In that case, the person is invariably liable for the consequences of that act irrespective of the fact whether he was negligent or not. Such a principle is an exception to the general rule of “liability for fault”, it is called “Strict liability”. The principle was first laid down in Rylands v Fletcher and the exceptions to this rule are Plaintiff’s fault, Act of God or Act of the third party. The rule of absolute liability, on the other hand, is often defined as the rule of strict liability minus the exceptions of strict liability. According to this rule, if a person is involved in any hazardous activity and any person due to any accident which occurred during the carrying out of the hazardous activity is harmed, then person carrying out such activity will be held absolutely liable. In India, this rule evolved in the case of MC Mehta v Union of India. Under these acts, the liable person may be not have been involved in the act but will still be held responsible for the damage caused due to the acts.
Strict liability was established through the case of Rylands v Fletcher[1].
In the case, the defendant(Fletcher) was an owner of a mill in Answorth. He wanted to improve water supply for his mill therefore, he employed the services of independent competent Engineers to construct a reservoir. In course of excavation work they notices some old shafts and passages to defendant’s land but did not block them. When the water was filled in the reservoir it ran through the porus shafts and flooded the plaintiff’s (Rylands) coal mines on the adjoining land. The defendant did not know about the shafts nor was he told about them by the qualified Engineers who constructed the reservoir.[2]The plaintiff sued the defendant.
The issues raised were whether the defendant can be held at risk, regardless of the fact that the act of another person led to an element get away in the plaintiff’s territory? It was exceptional that there was no carelessness or expectation on part of the defendant.
The court held that the supplication of the defendant was dismissed, and he was held at liable for all the damages in Ryland’s mine. A rule was set in this case which states that, if a man keepers in his territory any hazardous thing, he will be at first sight held liable if it escapes and harms even if he was not careless in keeping it there. Regardless that the defendant had no blame or carelessness, he was held liable since he kept some unsafe thing on his territory and the said thing has gotten away from his property and caused harm.
There are certain qualifications which are required to decide whether a liability should be strict liability or not. It is only after these qualifications are satisfied can a liability be termed as “strict liability”. These qualifications include:
Dangerous thing : This essentially implies that the defendant will be at risk when the thing got away from his territory was a dangerous thing. The word “dangerous” , in the context, implies that the thing can probably do any kind of mischief when it escapes.
Escape : This essentially implies that the thing causing harm should escape from the territory of the defendant, and it should not be within the reach of the defendant once it escapes.
Non-natural use of land : This essentially implies that for the use to be non-natural, it must be some special use that brings with it increased danger to others. It must not be ordinary use of land or use as is proper for the benefit of community.
Strict liability also includes certain exceptions in Strict Liability which are as follows:
Plaintiff’s fault : If the plaintiff has any blame or any damage is caused then the defendant would not be held liable, as the plaintiff himself interacted with the dangerous thing.
Act of God : This expression can be characterized as an occasion which is not under the ability to control of any human. Such acts happen solely because of characteristic reasons and cannot be anticipated even while practicing alert. The defendant, then, would not be held liable for the misfortune if the dangerous thing got away in the view of some unexpected and common occasion which could not have been controlled in any way.
The Act of Third Party : This rule additionally does not make a difference when the damage is caused by a third party i.e an outsider. The outsider implies that the individual is neither a servant of the defendant, nor the defendant has any sort of agreement with him or control over their work. But in cases, where the act of the third party could have been taken care of by the defendant, he must take care. Else, he will be considered liable.
Consent of the Plaintiff : This special case take the guideline of the maxim “volenti fit injuria”. Suppose if A and B are neighbors, and they share similar water source at the place of A, and if the water escapes and makes harm to B, he cannot claim damages, as A wouldn’t be obligated for the dam.
Thus, for tortious liability, whether the wrongful act was done intentionally, unintentionally or maliciously is generally immaterial as the main consideration in deciding these cases is whether the act complained by the plaintiff constitutes violation of any of his legal right. If it constitutes an infringement of the plaintiff’s legal right then the plaintiff will succeed and held to recover damages from the defendant but if there is no infringement then the case will be dismissed. The non-liability of defendant is also an indication that the alleged violation of right against the defendant has no legal existence.
‘If a free society cannot help the many who are poor, it cannot save the few who are rich’, quoted John F. Kennedy years before an epidemic like Covid-19 could have even been forecasted.
Starting from the Plague, a bacteria led pandemic to the Spanish Flu caused by a virus in 1918, the world has seen an invisible enemy mongering fear among the people. Though the epidemics did not change the patterns in people’s reactions but it outbreaks have certainly taught us about social distancing and responsibility. The response to the current pandemic, Novel Coronavirus Disease (COVID 19) has been no different. The current situation where the Government has been repeatedly asking people to be selfish about their loved ones and stay indoors is undoubtedly a decision in the public welfare as it stands as the only way to fight the issue. This infection with symptoms is frightening and can kill people in large numbers as evident in the developed countries but the epidemic is more threatening when thought of people it might affect without symptoms.
Looking back, the plague epidemic was certainly a major turning point in India’s public health system. The principles introduced were new then and vaccines developed turned the history of hospitalization in the country. But when it first came in Mumbai, there were only Social Service leagues and other voluntary organizations which did the work of supplying food and medicine to the needy. Thus, there was impression of hope and being taken care of even when the situation turned helpless.
The society is divided into sections and it is not unknown to anyone of the country. Even though the upper class can claim money not being important more than happiness, the lower class does not even know the meaning of happiness if there is no penny in the pocket. The lockdown period has pushed the lower class people, working under ‘no work, no pay’ policy to the extreme points of their lives so much that the deaths due to hunger can compete with the numbers of deaths due to the virus after a couple of months. The situation is similar to the Plague in a lot of ways, maybe it is time to change the principles and policies of the wage workers and mark it in the history once again.
Coronavirus pandemic is not a depression yet but it is a recession already. The country can easily fall back into a temporary economic crisis and technical point of actions can prevent permanent scars of depression. Compelling the payment of wages to the daily wage workers can be a measure that can instantly transform the social safety of the nation as once these workers lay off; there might be irreparable damages to the entire nation’s productive capacity.
The government has issued directions to the employers to pay wages on mere humanitarian grounds and, it is not only for the permanent workmen but for the contract workers as well. The Disaster Management Act, 2005 or the Epidemic Diseases Act, 1897 which specifically came into force after the epidemic in Mumbai does not guarantee any such direction to be in compliance with the statutory law. However, Central and State governments can take its measures accordingly and it is backed by the provisions.
Though it has taken time but the Government has come up with ideas to deal with the situation. The government has strictly advised to support the country by paying wages without any consequential deduction in wages for this period. The direction is issued particularly for the casual or contractual workers. On non-payment, the employees can drive down morally to combat their fight. On such kind of a scene, India, as a country, would lose even if it manages to fight the virus.
But the circular is only an ‘advisory’ and has not been issued under any law, ultimately making it not binding on any person. As dealt in the judgment of Narendra Kumar Maheshwari v Union of India that any policy does not take the place of law. Even the legislation under the Disaster Management Act, 2005 does not prohibit any employer from terminating employees or to vary their terms of service. But it does mention securing employees as it requires them to be paid salaries in the course of business. There also lies a major difference between the terms, employees and workmen as pointed out in Dhrangadhra Chemical works Limited v State of Saurashtra. The matter stands important since a workman is entitled to retrenchment as well as other benefits unlike the employers irrespective of whether temporary or permanent. It is important to note that ‘natural calamity’ is not particularly defined in the Act and can be claimed to fall under the ambit of it.
The migrants are stranded on roadways due to the current situation but hands of employers are tied as well and even though some might think but everyone cannot afford the same. Such a crisis is itself not compensated under loan forbearance.
In such a situation, the solution can be to adopt the idea of common law ‘lay off’ concept to pay 50% of wages so that their daily needs are at least met and also so that it can be done for a larger period to a bigger audience. The Government can also secure by adopting Canada’s plan to subsidize certain requirements and by giving them a privileged position by offering different schemes.
It is time that the country understands that we are all in this together. Without one section the other cannot sustain for long. Very evidently, when John F. Kennedy quoted, he might not have forecasted viruses or pandemics but he knew the world required to stand together for development.
Election Commission of India ~ Constitution of India ~ Article 324 ~ Supervision ~ Direction ~ Control ~ Accountability
Introduction:
The Election Commission of India is a central, state and district autonomous statutory body responsible and accountable for overseeing electoral process in India. The board administers Lok Sabha, Rajya Sabha elections, state assemblies, state legislative councils and president and vice president of the nation. Under Article 324 of the Constitution, the Election Commission does its work, and the Representation of the People Act has been subsequently enacted under it.
The commission has the strength and supremacy, under the Constitution, to engage in behaviour appropriate to the extent, when the enacted laws make insufficient provision for dealing with a given situation in the conduct of an election. As a constitutional body, the Election Commission is one of the limited bodies that operate with both sovereignty and independence, along with the nation’s higher judiciary, the Union Public Service Commission, and India’s Controller and Auditor General.
What is Election Commission of India?
The Election Commission of India (ECI), which was formed in 1950 to promote democratic process in India, is a constitutionally approved body. The headquarters are situated in New Delhi. It consists of three members namely, the Chief Electoral Commissioner and two other Commissioners who are designated by the president of India for a term of six years and who cannot be removed from office except through a parliamentary indictment. The ECI, while almost invulnerable to political pressures and scrupulously neutral, is tasked with ensuring free and fair elections.
The Indian Election Commission is the governing body of the election. The Election Commission of India (ECI) is envisaged by Article 324 of the Constitution of India. It defines the code of conduct for election model in the country.
The Constitution under Article 324 provides for the planning, conduct and supervision for elections to the legislature, the state governments and the president and vice-president offices by the Election Commission. Therefore, both the central and the regional elections are the responsibility of the Election Commission. It is also responsible for preparing, maintaining and updating the electoral rolls, raising political funds, registration of political parties, nomination of candidates, monitoring of campaigns, accelerating media, arranging and organising polling booths, superintending the vote counting and result declaration. The ECI is convincing and determined in matters of elections—for instance, where the law is ambiguous—but it can be challenged in courts of law.
In the early 21st century, the Indian general elections became the world’s biggest democratic exercise. In a number of geographical, political and climate ways, they involved nearly 700 million voters in some 700,000 polls. The ECI functions through a secretariat of some 300 staff members. Each state has a Chief Electoral Officer with a core staff, and civil servants assume the responsibilities of election officials at the district and electoral levels. However, during the general election, an enormous team of temporary workers up to five million people are responsible for the conduct of the poll.
Superintendence, Direction, Control and Accountability for Elections
In Article 324, the term superintendence, direction and control and the conduct of all elections were kept to include certain powers which, although not expressly given, are required to be exercised in order to effectively fulfil the task of holding the elections at their completion. Furthermore, it would be appropriate for the Commission to make general provisions on matters pertaining to symbols, either in anticipation or in the light of practice.[1] For the purpose of free and fair elections and for the protection and security of electors and with a view to avoiding bullying and victimization of electors, the Commission has full authority to guide the way in which ballots are counted and is accountable for the measures taken during the due process.[2] For transfer of those officers (who had completed more than four years of stay in one district) from one district to another, directives are issued by the Election Commission, were adopted pursuant or intra vires to Article 324.
The text conduct of the elections referred to in Article 324 was considered to be broad in scope, which would include the power to make all the necessary arrangements for the conduct of free and fair elections. As every contingency cannot be acknowledged or anticipated beforehand, the Supreme Court in Union of India v. Association for Democratic Reforms[3], held that the Commission could cope with a situation in which the field had not been occupied by issuing the necessary orders. Article 324 was said to be a reserve of power, giving the Commission its own right to exercise residual authority a creature of the Constitution. The Commission may, therefore, issue instructions asking the candidates to provide information on their assets, their educational qualifications, the background of their lives, etc. Nevertheless, the terms ‘superintendence, direction and control in Article 324 are intended to complement and not replace the law and, therefore, the Commission cannot move against a validly formed electoral law. No power to de-register a political party shall also be bestowed on the Election Commission. Moreover, with the approval of the State, the Commission may control any legal issue not protected by the Rules of Procedure set out in the Legislature.
In the case of Ram Deo Bhandari v. Election Commission[4], the Supreme Court held that the Election Commission was free to take such measures as it deemed appropriate to ensure a free and fair vote, but would not withhold the elections to the Legislative Assembly of a State on the ground that it had failed to complete the process of issuing photo identity cards within the time limit prescribed by the Commission, for it would be contravention of the mandate of Article 168 of the Constitution.
In the case of J.T. Girls Degree College v. State of U.P.[5], it was ruled that the Election Commission and the Election Authorities are both controlled by the 1951, Representation of People Act, and cannot act in a manner inconsistent with the Act. It is also recommended that Article 324 should be read in the context of the Constitutional Scheme and the Act of 1950 and of 1951. In A.C. Jose v. Sivan Pillai[6], some significant errors in the use of EVM had been identified by the Supreme Court. Since these deficiencies had been taken care of by the new improved version of EVM as well as by the Representation of People Act, 1951 and the Rules there under were modified accordingly.
Some Issues for which ECI has to be Accountable
The presence of money and criminal elements in politics has risen over the years, along with intimidation and political corruption resulting in elections being criminalized. The ECI could not stop the deterioration.
A blatant misuse of power has occurred by the state government, which often makes large-scale transactions on the eve of elections and posts malleable officials in key positions, often employing official vehicles and electioneering buildings, in violation of the ECI model code of conduct.
The ECI is not properly prepared to control the parties. The ECI does not have the authority to impose internal party control and to govern party finances.
Throughout the past few years, there has been a growing perception that the Election Commission is becoming increasingly independent of the executive that has damaged the institution ‘s reputation.
One of the main institutional drawbacks is the lack of accountability in the election of the CEC and two other commissioners and the choice of the presiding government.
EVMs have been reported to be malfunctioning, to be hacked and not to record votes that corrode the confidence of the institution of the general masses.
Loss of structural governance as a result of decreasing democratic morality norms and deteriorating service ethic and commitment in public life.
An inefficient and lengthy judicial method of managing electoral requests, frequently making the whole method meaningless.
Conclusion:
Through the years, a range of commendable electoral reforms have been carried out by the Election Commission to improve democracy and improve the fairness of the elections. These changes are admirable and equally sufficient. Under the EC’s auspices, the election machinery certainly deserves plaudits for free and fair conducting of elections. So many vices still torment our framework. Political parties turn to irrational tactics and unethical practices to win votes. These diseases promote entry of the anti-social elements into the electoral competition. The question is not the lack of legislation but their lack of rigid compliance and enforcement. There is a need to strengthen the EC’s hands and give it more legal and institutional power and authority to root out those unjust tendencies. The EC must be granted powers to discipline the errant politicians who are transgressing and breaching the voting process and code of conduct.
Frequently Asked Questions (FAQ’s):
Q.1. What are the advantages of using EVM’s?
A.1. Electronic Voting Machines (EVM’s) have been widely used in important constituencies in restricted areas and also, in by-elections. Throughout the Goswami Committee deliberations, any questions regarding this technology were amply removed. Not only were the EVMs satisfactorily demonstrated to all representatives of parliament, but many electronic experts from the Indian government also testified that the devices could be used without any lingering doubts at all the elections. The benefits of EVMs are very evident in preventing large-scale rigging as the system locks up and will allow just one hit every several seconds. Wherever such EVMs were used in urban and rural areas, there were no large-scale rigging reports.
Q.2. What are successes and failures of ECI?
A.1. Thirteen general elections to Lok Sabha and a much greater number to various State Legislative Assemblies have been held over the last half-a-century. We should take genuine pride in the fact that these were successful and widely accepted as free and equal. But the experience has also brought many misconceptions to the fore, some very severe, which in many quarters has created a profound concern. Links to the toxic position of financial influence, muscle strength, and mob control and criminalization, racism, communitarianism, caste system and corruption are frequent.
Our country is a pioneer in industrial development and the demo-graphs of such development is soaring high each day. Also, with the complexity in both geography and life, it is necessary the rules established should be strict and more absolute principle of liability with the respect of no fault liability. Thus, the principle established in Rylands v Fletcher of strict liability evolved in the 19th century, and in the period when the industrial revolution had just begun cannot be used in the modern world. The two century old principle of tortious liability compared to the present conditions of our country when it is in the verge of being one of the most globalized countries of the world, cannot be taken into consideration without modifications. It is also to notice that the technical complexity and the nature of industrial development being high at a high rate, the protection of the human rights and lives of people should be taken into consideration. Hence, the principle of strict liability cannot be still considered as the only redressal. It is also true that law cannot afford to be static and the fact that the industrial development cannot be done without the existence of inherently dangerous industries, it is very much necessary that the responsibility for the protection of people from any such type of accidents, etc is put on the shoulders of the industries themselves. From the above mentioned points, it is a key necessity that such a principle is evolved which will not only shape the jurisprudence but will also help to not carry the absolute principle of Strict liability in modern society. Thus, the necessity factors as discussed clearly helps us to understand that the principle of absolute liability is not only required to protect the human rights of the people, but also to develop tort law in India which will expand our own country’s jurisprudence.
In absolute liability only those are risk which are associated with risky or isn’t fundamental. It is material to those harmed inside and outside the preface. The rule doesn’t have any special exceptions like Strict Liability. The control which was clarified in Rylands v Fletcher applies just to the normal utilization of land, however, outright risk applies even to the common utilization of land. When a man utilizes a dangerous substance and that substance gets away, he will be held liable even if he had taken due care. The degree of the dangerous activity also depends upon the money and size related capacity of the establishment. The Supreme Court additionally expressed that the undertaking must be held to be under a “commitment to guarantee” that the hazardous dangerous activity exercises in which it must be directed with the most standard of safety and security if any damage comes because of such careless activity. The organization, then, must be held absolutely liable to adjust, for any harm caused and no defense that he had taken all sensible care and the damage caused with no carelessness on his part.
The principles of absolute and strict liability can be viewed as exceptions. It is known that a man can be at risk if he has fault. The guideline overseeing these two rules is that a man can be a subject even without his fault. Thus, this is also known as principles of “no fault liability”. Under these principles, the individual at risk might not have done or been involved in the act, but he will be at charge despite everything because the harm was caused by the act. In the principle of strict liability, there are a few exceptions where the defendant would not be made at risk. But in absolute liability, no exceptions are given to the defendant. Tort is a civil wrong for which the remedy is a precedent based law activity for unliquidated harms and which doesn’t necessarily happen due to breach of an agreement or the break of a trust or just fair commitment. For “no fault liability”, the individual at risk might not have done any act of negligence or carelessness or may have put in some positive attempts but however the rule will hold him liable. This guideline has its foundations in the two landmark cases – Rylands v Fletcher (Strict Liability) and MC Mehta v Union of India (Absolute Liability). The strict liability principle expresses that a person who keeps hazardous or inherently dangerous substance in his territory will be in charge of the fault if that substance escapes in any way and causes any harm. This rule stands genuine even if there are no negligence or carelessness in favor of the person keeping it. The burden of proof lies on the defendant to act how is not at risk. The principle of absolute liability, on the other hand, held that where a person is undertaking a hazardous or inherently dangerous movement and it hurts anybody because of an accident while carrying out the characteristically hazardous action, the result is strictly and absolutely liable decision where the remedy is to repay to everyone who was affected by the accident. Both these principle take after the “no fault liability principle”, a principle in which the defendant is held liable regardless of whether he is not specifically or impliedly in charge of the harms caused to the plaintiff.
Every person is a friend until he wants something from you. I thought that real friends are rare but now realised that they never exist. I believed in friendship and was happy to have such friends until a day came. I never thought atleast it in a dream. I was happy being with them untill I became sad.
My friend’s friend became my friend until he became my enemy in an incident. May be I was wrong and may be I might deserve that. I thought of having a good relationship with them until a day then. No one ever tried to console me. They had their priorities until I left with none. I never cried in my under graduation but that pain of being ignored ny your true friends can’t be expressed. The pain of being ignored made me feel more than the pain that left after quarrelling.
There’s no need to share happy moments but it’s important to share your sadness with your friend. A friend should hold us in sadness. I felt alone at that moment and felt being ignored by them. I too tried to fake a friendship with them. But that never existed long. I am not like them. I feel the pain of my sorrow and as well as them. I don’t why I am feeling alone during friendship day. Till yesterday I was ok with what I feel. But all of sudden something happened to me because of my expectations on my friend. Friend never helps it’s we who hope a lot from him. Stop depending on them and start believing in yourself.
I feel like writing more and more because it’s the only thing with whom I can share my feelings. Last year this day was different. I completely believed in friendship. May be its due to my bitter experiences in life made me so. Hope someday someone make me feel what true friendship is. I don’t know why am I feeling like this that too this day. I never felt to cry while writing because I quit writing while I am about to cry. But this sorrow is making me to write more and more so as to minimise my sadness. I was always alone and felt as though I had got everything I needed untill then. Everyone will feel the same at some saturated point in your life. Friendship ends sooner or later. It’s you or the person on the other side had to leave a thread and make you fall like thug of war.
It’s not what I wrote it’s what I felt. So never try to have expectations because till yesterday bI was fine till I started thinking. If you wanna hold fake friendships then start being fake because no one gonna make you feel happy when you are sad. I am the victim of my own expectations.
The Administrative Tribunals rendering Administrative equity comprise a side-effect of the government assistance state. In the eighteenth and nineteenth century when ‘free enterprise’ hypothesis held influence, law courts rose out as the caretaker of the rights and freedoms of the individual residents. On occasion they also ensured the privileges of the residents at the expense of the State authority.
With the rise of government assistance state, social intrigue started to be given a precedence over the individual rights. The current legal executive neglected to maintain the new framework. In the expressions of Robson, “with the expansion during the nineteenth and twentieth centuries of the functions of the legislature to one new field after another, with the dynamic confinement of the privileges of the people in light of a legitimate concern for the wellbeing, security and general government assistance of the community overall, with the improvement of aggregate power over the states of work and way of living and the rudimentary necessities of the individuals changed. There has emerged a requirement for a method of settling better fitted to react to the social prerequisites of the time than the intricate and exorbitant arrangement of choice gave by case in the courtrooms. In brief the new arrangement of authoritative arbitration fit new social finishes upheld by a government assistance state. It demonstrated a potential instrument for authorizing social arrangement and enactment.
Anything which tends or might be viewed as tending to make an individual choose a case in any case than on proof must be held to be one-sided. The primary prerequisite is that the appointed authority ought to be unprejudiced and common and must be liberated from inclination. One can’t go about as judge of a reason in which he himself has some intrigue either monetary or in any case as it manages the most grounded evidence against impartiality. One must be in a situation to act judicially and to choose the issue impartially. In the event that the appointed authority is liable to inclination for or against either gathering to the debate or is in a place that a predisposition can be accepted, he is precluded to go about as an adjudicator and the procedures will be vitiated.
Equity can never be checked whether a man goes about as an appointed authority in his own motivation or is himself keen on its result. This rule applied not exclusively to legal procedures yet in addition to semi legal and managerial procedures. In responding to the inquiry with respect to what alleviation the individual is qualified for on account of the court when the disappointment of characteristic equity has happened, it is that down to earth contemplations ought to win as opposed to attempting to address the inquiry by applying such unfeeling words as “void” and “voidable” or theoretical rationale.
The cases don’t delineate uniform methodology in the matter of giving extreme alleviation by the court when the disappointment of regular equity including giving of reasons has happened. In the matter of disappointment of Audi alteram partem the courts have received any of the three options as the equity of the circumstance requested—just subduing the request, not suppress the request yet keeping up the state of affairs and guiding the administration to give a consultation, lastly suppress as well as disallowing the legislature from reexamining the issue.
Further, the Supreme Court has faltered in giving further help normally spilling out of the subduing of the request. Most definitely, where the reasons host nor been provided to the get-together nor to the court, the assignment of the legal executive is to some degree simple. The courts have pretty much suppressed the regulatory request. In such a case, there isn’t the main disappointment of common equity however the non-correspondence of reasons might be demonstrative of the way that the authority has not applied its psyche to the issue. Where, be that as it may, the reasons have been given to the court, however not to the gathering, the cases don’t portray a uniform methodology.
In various cases, the court has maintained the authoritative request once it is fulfilled that the reasons set under the steady gaze of the court legitimized the equivalent. There are a couple of cases likewise despite what might be expected. Here maybe the issue may must be settled based on equity however the idea of equity is a liquid and escaping one.
Innuendo is used to describe defamation from libel or slander. It is derived from a Latin term “innuere”, “to nod toward”. In lawsuit for defamation, usually to show that the party suing was the person about whom the defamatory statement was made. Example: ‘the former Mayor is a crook,” and Joe Alexander is the only living ex-Mayor, thus by innuendo Alexander is the target of the statement.
Defamation is the injury to the reputation of a person. If a person harms the reputation of another he does so at his own risk. As in the case of interference with the property, a man’s reputation is his property, and if possible, more valuable, than other property.
Any intentional false, defamatory statement or communication, written or spoken that decrease the respect, regard or confidence of a person will be called defaming him. Essential of defamation include, the statement being published, the statement should not be truth and it must refer to the plaintiff.
The intention to defame is not necessary as held in the Scottish case of Morrison v. Ritchie and Co.[1] ,where damages were recovered against the proprietors of a newspaper who in all innocence had announced in the paper that a lad, who had in fact been married only a month, had given Innuendo is a concept that is related to tort law and is a personal injury law. The word is derived from ‘innuere’, which is a Latin word and means to ‘nod forward’. In legal terms, Innuendo is used to describe defamation from either libel or slander. It usually shows that the plaintiff had bad comments made about him and those comments were in fact defamatory.
The innuendo is usually just used in actions for slander, when a defamation made by words or gestures. Innuendo typically refers to a condition where a person explains a factual situation which on the first note might not sound defamatory but, yet after interpreting can cause or has caused damage to the person.
Thus, when Innuendo is on the table to be proved, it must always show the entire scenario from start to the end of the declaration. This serves to be very important to prove that the intent can be mistaken, or when it cannot be directly obtained from the forms of slander or libel.
There are two major types of innuendo. True Innuendo and False Innuendo. False innuendo is a defamatory statement made that has an implied meaning. So, only individuals who have the necessary contextual knowledge can understand that the comment made is defamatory.
Secondly, legal or true innuendo. While this is not defamatory on its face, a true innuendo statement can be defamatory when combined with certain outside circumstances. This contextual information may cause a statement to be considered defamatory in a certain way while not another.
A statement may be prima facie defamatory when their natural, obvious and primary sense is defamatory. Sometimes, the words may prima facie be innocent but because of some latent or secondary meaning, it may be considered to be defamatory.
Where the words alleged to be defamatory do not appear to be such on their face, the plaintiff must make out the circumstances which made them actionable, and he must set forth in his pleading the defamatory sense he attributes to them. Such an explanatory statement is called an innuendo.
When the natural and ordinary meaning is not defamatory but the plaintiff wants to bring an action for defamation, the burden of proof lies on him to prove the innuendo.
In the absence of an innuendo, no evidence can be admitted to prove a special meaning and the suit will be dismissed.
An innuendo is necessary where the imputation is made in an oblique way, or by way of question, exclamation, or conjecture, or irony.
An innuendo, properly so called, which provides a separate cause of action, must be supported by extrinsic facts or matter and cannot be founded on mere interpretation.
The current education system of India is considered as the education system of the dependent period. It is regarded as a gift of British rule. This system was born by Lord Macaulay. Due to this system, even today, clerks and babu with white collars are being incurred. Due to this education system, the physical and spiritual development of students is not possible.
Ancient India
Education was of great importance in ancient times. The emergence of civilization, culture, and education was first in India. In ancient times, the place of learning was Gurukul of the forests far away from the cities and noise. Sages and sages operated these gurukuls. In ancient times, students practiced celibacy and received full education only by sitting at the feet of their guru. Some similar schools were Taksha Shila and Nalanda. Foreigners also used to come here to get an education. Then came the medieval era when India had to suffer a long period of subordination. Arabic-Persian education spread during the Muslim era. When the 18th and 19th centuries came, only the rich and the feudal could accept education. Female education was almost over.
A need for New Educational System
India became independent on August 15, 1947. The attention of our masters went towards the modern education system as the British education system was not compatible with our education system. Gandhiji had said about education that education means the development of all physical, mental, and moral powers in children. Several committees were formed to improve the education system. A vast scheme was devised by the committee, which could spread 50% education within three years. Secondary education was created. Efforts were made to solve the problem of the university itself. Later the Basic Education Committee was formed to promote basic education in India. Primary education among children was made compulsory due to the recommendation of the All India Education Committee.
Establishment of Kothari Commission
To bring changes in the field of education, the Kothari Commission was established. This commission recommended implementing the new scheme at the national level. The discussion of this scheme was long-lasting. This system was implemented in many states of the country. This system will lead to general education in the tenth grade for ten years.
In this, all the students will study the same subjects. In this course, two languages, mathematics, science, and society, will be considered on five topics. But students should also be familiar with physical education. After the seventh examination, students will study different subjects. If he wants, he can take science; take commerce and even craft for industrial work.
Benefits,
The new education system has been created, keeping employment in front. We often see that people attend universities and colleges, but they are not interested in studying. Such people create indiscipline and anarchy in society. We will benefit from the new education policy that such students will remain till the tenth and they will not be able to take admission in the college.
Eligible students will be able to get admission in colleges. After completing the tenth, students will be able to get employment by taking admission in diploma courses. But if we want to make the new education system successful, then diploma courses will have to be opened from place to place so that students do not run towards colleges after completing the tenth standard.
Defects,
One can find a lot many issues in the Indian education system that hinders the proper growth and development of an individual. The main disputes and problems with the Indian education system is its marking and grading system. Students’ intelligence is judged from a three-hour paper, not its practical abilities. Its ability to cram is appreciated, not actual knowledge.
Another issue is that the focus is only on theory. No importance is given to practical education. Our education system encourages students to become bookworms and does not prepare them to deal with the real problems and challenges of life.
Such importance is given to academics that the need to involve students in sports and art activities are ignored. Along with studies, students are also dominating. Regular exams are conducted, and students are examined at every step. It creates intense tension in the students. When they go to higher classes, students’ stress levels keep increasing.
The need to change the Indian education system has been emphasized many times. However, little has been done in this regard. It is time to understand the importance of improving the old system for the better future of children and the whole nation.
LLP is a corporate business vehicle that enables professional expertise and entrepreneurial initiative to combine and operate in flexible, innovative and efficient manner, providing benefits of limited liability while allowing its members the flexibility for organizing their internal structure as a partnership.
The Limited Liability Partnership Act, 2008(LLP Act) does not provide an exhaustive definition. Sub-section (n) of section 2 of the Act states that “limited liability partnership” means a partnership formed and registered under this Act.
NATURE AND CHARACTERISTICS OF LLP
1. The LLP is a body corporate having separate entity from its partners and perpetual succession.
2. An LLP in India is governed by the Limited Liability Partnership Act, 2008 and, therefore, the provisions of Indian Partnership Act, 1932 are not applicable to it.
3. Every Limited Liability Partnership shall use the words “Limited Liability Partnership” or its acronym “LLP” as the last words of its name.
4. An LLP is a result of an agreement between the partners, and the mutual rights and duties of partners of an LLP are determined by the said agreement subject to the provisions of LLP Act, 2008.
5. The LLP being a separate legal entity is liable for all its assets, with the liability of the partners limited only to the amount of contributed by them just like a company. No partner will be individually liable for any wrongful acts of other partners. However if the LLP was formed for the purpose of defrauding creditors or for any fraudulent purpose, then the liability of the partners who had the knowledge will be unlimited.
6. There must be at least two designated partners in every LLP of whom one shall be resident in India.
7. Every LLP shall maintain annual accounts to show its true state of affairs. It must prepare a statement of accounts and solvency every year and file with the Registrar.
8. The Central Government may, whenever it thinks fit, investigate into the affairs of an LLP by appointing a competent Inspector.
9. A firm, private company or an unlisted public company have the option to convert itself into LLP as per the provisions of the Act. Upon such conversion, the Registrar will issue a certificate to that effect. After issuance of a certificate of registration, all the property of the firm or the company, all assets, rights, obligations relating to the company shall be vested in the LLP so formed, and the firm or the company stands dissolved.
10. The name of the firm or the company is then removed from the Registrar of Firms or Registrar of Companies, as the case may be. Like the company, an LLP can be wound up either voluntary or by the Tribunal established under the Companies Act, 2013
11. The LLP Act 2008 also enables the Central Government to apply the provisions of the Companies Act whenever it thinks appropriate.
ADVANTAGES OF LLP
Easy to form: Forming an LLP is an easy process. It is less complicated and time consuming unlike the process of formation of a company.
2. Liability: The partners of the LLP is having limited liability which means partners are not liable to pay the debts of the company from their personal assets. No partner is responsible for any other partner’s misconduct.
3. Perpetual succession: The life of the Limited Liability Partnership is not affected by death, retirement or insolvency of the partner. The LLP will get wound up only as per provisions of the LLP Act.
4. Management of the company: An LLP has partners, who own and manage the business. This is different from a private limited company, whose directors may be different from shareholders.
5. Easy transferability of ownership: There is no restriction upon joining and leaving the LLP. It is easy to admit as a partner and to leave the firm or to easily transfer the ownership to others.
6. Taxation: an LLP is not subject to Dividend Distribution Tax. (DDT). Distributed profits in the hands of the partners is not taxable. For Income Tax purposes, LLP is treated on par with partnership firms.
7. No compulsory audit required: Every business has to appoint an auditor for checking the internal management of the company and its accounts. However, in the case of LLP, there is no mandatory audit required. The audit is required only in those cases where the turnover of the company exceeds Rs 40 lakhs and where the contribution exceeds Rs 25 lakhs.
8. Fewer compliance requirements: An LLP is much easier and cheaper to run than a private limited company as there are just three compliances per year. On the other hand, a private limited company has a lot of compliances to fulfil and has to compulsorily conduct an audit of its books of accounts.
9. Flexible agreement: The partners are free to draft the agreement as they please, with regard to their rights and duties.
10. Easy to wind-up: Not only is it easy to start, it is also easier to wind-up an LLP, as compared to a private limited company.
DISADVANTAGES OF LLP
Restricted Access to Capital Markets: LLPs are small form of business and cannot get its shares listed in any stock exchange through initial public offerings. With this restriction, limited liability partnerships may find it difficult to attract outside investors to buy the shares.
2. Rights of partners: An LLP can be structured in such a way that one partner has more rights than another. So it isn’t a one vote per share system. So, some lesser partners may feel compromised if higher shareholders choose to move the business in a direction that affects their interests.
3. Public Disclosure of LLP Information: A LLP must file its Annual Returns, Financial Statements etc to the Registrar of LLPs annually. Which become public document once filed with Registrar of LLPs and may be inspected by general public including competitors by paying some fees to the Registrar of LLPs. Information disclosure can make an entity competitively disadvantaged. Competitors – especially those not required to disclose any documents – can access that information and use it to improve their own business.
4. Limitations in Formation of LLP: LLP cannot be formed by a single person. A non – resident Indian and a Foreign National willing to form a LLP in India must have one person resident in India to act as Designated Partner. Further FDI in LLP is allowed only through government route only and that too in those sectors only where 100% FDI is allowed under automatic route under the FDI Policy. This limitation makes LLP an unattractive form of business.
5. Offenses and penalties: Limited Liability Partnership Act, 2008 provides that for non-compliance on procedural matters such as delay in filing of e-forms, one has to pay default fee for every day for which the default continues. Such default fee would be payable at the rate of rupee one hundred per day after the expiry of the date of filing up to a period of three hundred days. The offense can result in either:-
(i)through payment of fine or
(ii) through payment of fine as well as imprisonment of the offender.
6. Exit Options are Not Easy for LLPs in default of Filings: A LLP who has defaulted in filings its statement of accounts and annual return with the Registrar of LLPs, willing to shut down its operations and wind up, will have to make its default good first by filing necessary e-forms with late filing fee. This provision is making LLP an unattractive form of business as in India there are many businesses that are ignorant about compliances.
7. Limitation in External Commercial Borrowings (ECB): Limited Liability Partnerships are not allowed to raise ECB. Therefore, a LLP cannot avail commercial loans from its foreign partners, FIIs, Foreign Banks, and any financial institution located outside India.
PROCEDURE FOR AN INCORPORATION OF LLP
The incorporation document shall be filed in Form FiLLiP (Form for incorporation of Limited Liability Partnership) with the Registrar having jurisdiction over the State in which the registered office of the limited liability partnership is to be situated.
If an individual required to be appointed as designated partner does not have a DPIN or DIN,application for allotment of DPIN shall be made in Form FiLLiP The application for allotment of DPIN shall not be made by more than two individuals in Form FiLLiP: an application for reservation of name may be made through Form FiLLiP: Provided also that where an applicant had applied for reservation of name under rule 18 in Form RUN-LLP (Reserve Unique Name-Limited Liability Partnership) and which has been approved, he may fill the reserved name as the proposed name of limited liability partnership.
THE SUMMARIES PROCEDURE FOR
Incorporation of LLP is as under:
Procure DSC and DIN:
Procure DSC and DIN for the individuals acting as Designated Partners of LLP. A person, who already has a DIN, is not require to obtain any new DIN. Existing DIN to be used for Designated Partner (However, DIN should have all latest details such as resident of India, name, address etc.). Any person proposed to become the Designated Partner in a new LLP shall have to make an application through eform FiLLiP. An application for allotment of DIN up to two Designated Partners, shall be filed in an e-form FILLiP with the Registrar, in case of proposed Designated Partners not having approved DIN.
2. Name reservation: The first step in incorporation of an LLP is reservation of name of the proposed LLP. There are two ways of reserving name of the proposed LLP.
i. File an application under LLP-RUN for ascertaining availability and reservation of the name of an LLP.
ii. Name can be proposed in eform FiLLiP, an application for incorporation of LLP.
3. Incorporate LLP: After reserving a name under LLP-RUN, applicant should file eform FiLLiP for incorporating a new LLP. eform FiLLiP contains the details of LLP proposed to be incorporated, Partners’/ Designated Partners’ details and consent of the Partner/ Designated Partners to act as Partners/ Designated Partners. On approval of the form, the RoC will issue the certificate of incorporation.
Where the Registrar, on examining Form FiLLiP, finds that it is necessary to call for further information or finds such application or document to be defective or incomplete in any respect, he shall give intimation to the applicant to remove the defects and re-submit the e-form within fifteen days from the date of such intimation given by the Registrar.
After re-submission of the document, if the Registrar still finds that the document is defective or incomplete in any respect, he shall give one more opportunity of fifteen days time to remove such defects or deficiencies: Provided that the total period for re-submission of documents shall not exceed thirty days.
Documents to be attached with form FiLLiP:
i. Consent of the partners.
ii. In case of the partners who are body corporates, certified true copy of the board resolution is passed by such body corporate partners.
iii. Proof of address of registered office of LLP.
iv. Subscribers’ sheet including consent.
v. Detail of LLP(s) and/ or company(s) in which partner/ designated partner is a director/ partner.
vi. Copy of approval obtained from any sectoral regulator/in-principle approval.
vii. Identity and address proof of individuals acting as Partner and/or Designated Partner.
viii. List of main objects of an LLP.
ix. If the name proposed is liked to registered trademark, NoC from the trade mark owner.
x. NOC of foreign body corporate for usage of name (In case of foreign entities intending to incorporate LLPs in India).
The companies can be divided into different types based on parameters such as Size of company, a number of its members, Control of ownership, Liability to shareholders, need of capital from public & On the basis of the manner in which capital can be accessed. A company is popularly referred as a group of person coming together with resources in terms of capital, manpower, and skill for the common objective of making profits.
In old companies Act 1956 a company should have at least 2 persons as its member or shareholder. However, the companies Act 2013 introduced a new concept of One Person Company in India wherein only one Indian person who is a citizen of India can register a private limited company with some limitation, the different types of companies can be classified based on different parameters.
CLASSIFICATION OF THE COMPANIES
1. Classification on the basis of Incorporation: Companies may be Incorporated under the following categories:
(a) Statutory Companies: These are constituted by a special Act of Parliament or State Legislature. The provisions of the Companies Act, 2013 do not apply to them. Examples of these types of companies are Reserve Bank of India, Life Insurance Corporation of India, etc.
(b) Registered Companies: The companies which are incorporated under the Companies Act, 2013 or under any previous company law and registered with the Registrar of Companies, fall under this category.
2. Classification on the basis of Liability: Under this category there are three types of companies: –
(a) Unlimited Companies: In this type of company, the liability of members of the company is unlimited, Section 2(92) of the Companies Act, 2013 provides that unlimited company means a company not having any limit on the liability of its members, Such companies may or may not have share capital. They may be either a public company or a private company. . The members is liable to the company and to any other person.
(b) Companies limited by guarantee: Section 2(21) of the Companies Act, 2013 provides that a company that has the liability of its members limited to such amount as the members may respectively undertake, by the memorandum, to contribute to the assets of the company in the event of its being wound-up, is known as a company limited by guarantee. The members of a guarantee company are, in effect, placed in the position of guarantors of the company’s debts up to the agreed amount. the members is liable to the company and to any other person.
(c) Companies limited by shares: A company that has the liability of its members limited by the liability clause in the memorandum to the amount, if any, unpaid on the shares respectively held by them is termed as a company limited by shares. Section 2(22) of the Companies Act, 2013 provides that “company limited by shares” means a company having the liability of its members limited by the memorandum to the amount, if any, unpaid on the shares respectively held by them.
For example,a shareholder who has paid Rs. 75 on a share of face value Rupees 100 can be called upon to pay the balance of Rupees.25 only’. Companies limited by shares are by far the most common and it may be either public or private.
3. Other Forms of Companies
(a) Section 8 Companies: a person or an association of persons proposed to be registered under this Act as a limited company and proved to the satisfaction of the Central Government that the company –
i. has in its objects the promotion of commerce, art, science, sports, education, research, social welfare, religion, charity, protection of environment or any such other object;
ii. intends to apply its profits, if any, or other income in promoting its objects; and
iii. intends to prohibit the payment of any dividend to its members such person or association of person may be allowed to be registered as a limited company without addition to its name of the word “limited” or private limited by the Central government by issuing a license and by prescribing specified condition.
The association proposed to be registered under section 8 shall not be proposed to be an unlimited company. However the same may be company limited by guarantee or a Company limited by shares.
(b) Government Companies: As per section 2(45) of the Companies Act, 2013 the Government company” means any company in which not less than fifty-one per cent of the paid-up share capital is held by the Central Government, or by any State Government or Governments, or partly by the Central Government and partly by one or more State Governments, and includes a company which is a subsidiary company of such a Government company;
(c) Foreign Companies: As per section 2(42) of the Companies Act, 2013 the “foreign company” means any company or body corporate incorporated outside India which,-
(a) has a place of business in India whether by itself or through an agent, physically or through electronic mode; and
(b) conducts any business activity in India in any other manner.
(d) Holding and Subsidiary Companies; As per section 2(46) of the Companies Act, 2013 46) the “holding company”, in relation to one or more other companies, means a company of which such companies are subsidiary companies and the expression “company” includes any body corporate.
As per section 2(87) of the Companies Act, 2013 “subsidiary company” or “subsidiary”, in relation to any other company (that is to say the holding company), means a company in which the holding company –
(i) controls the composition of the Board of Directors or
(ii) exercises or controls more than one-half of the 19[total voting power] either at its own or together with one or more of its subsidiary companies:
Provided that such class or classes of holding companies as may be prescribed shall not have layers of subsidiaries beyond such numbers as may be prescribed.
Explanation.- For the purposes of this clause, –
(a) a company shall be deemed to be a subsidiary company of the holding company even if the control referred to in sub-clause (i) or sub-clause (ii) is of another subsidiary company of the holding company;
(b) the composition of a company’s Board of Directors shall be deemed to be controlled by another company if that other company by exercise of some power exercisable by it at its discretion can appoint or remove all or a majority of the directors.
(c) the expression “company” includes any body corporate.
(d) “layer” in relation to a holding company means its subsidiary or subsidiaries.
As per section 2(11) of the Companies Act, 2013, the “body corporate” or “corporation” includes a company incorporated outside India, but does not include –
(i) a co-operative society registered under any law relating to co-operative societies and
(ii) any other body corporate (not being a company as defined in this Act), which the Central Government may, by notification, specify in this behalf.
(e) Associate Companies/ Joint Venture Company: As per section 2(6) of the Companies Act, 2013 the “associate company”, in relation to another company, means a company in which that other company has a significant influence, but which is not a subsidiary company of the company having such influence and includes a joint venture company.
Explanation.- For the purpose of this clause, –
(a) the expression “significant influence” means control of at least twenty per cent. of total voting power, or control of or participation in business decisions under an agreement.
(b) the expression “joint venture” means a joint arrangement whereby the parties that have joint control of the arrangement have rights to the net assets of the arrangement.
(f) Investment Companies: the term “investment company” includes a company whose principal business is the acquisition of shares, debentures or other securities 13[and a company will be deemed to be principally engaged in the business of acquisition of shares, debentures or other securities, if its assets in the form of investment in shares, debentures or other securities constitute not less than fifty per cent. of its total assets, or if its income derived from investment business constitutes not less than fifty per cent. as a proportion of its gross income.
(g) Producer Companies: Producer Company means a body corporate having objects or activities specified in section 581B of the Companies Act, 1956 and registered as Producer Company under the Companies Act.
The objects of the Producer Company shall relate to all or any of the following matters, namely:
i. production, harvesting, procurement, grading, pooling, handling, marketing, selling, export of primary produce of the Members or import of goods or services for their benefit: Provided that the Producer Company may carry on any of the activities specified in this clause either by itself or through other institution ;
ii. processing including preserving, drying, distilling, brewing, vinting, canning and packaging of produce of its Members ;
iii. manufacture, sale or supply of machinery, equipment or consumables mainly to its Members.
iv. providing education on the mutual assistance principles to its Members and others.
v. rendering technical services, consultancy services, training, research and development and all other activities for the promotion of the interests of its Members.
vi. generation, transmission and distribution of power, revitalisation of land and water resources, their use, conservation and communications relatable to primary produce.
vii. insurance of producers or their primary produce.
viii. promoting techniques of mutuality and mutual assistance.
ix. welfare measures or facilities for the benefit of Members as may be decided by the Board.
x. any other activity, ancillary or incidental to any of the activities referred above or other activities which may promote the principles of mutuality and mutual assistance amongst the members in any other manner.
xi. financing of procurement, processing, marketing or other activities specified above which include extending of credit facilities or any other financial services to its Members.
(h) Nidhi Companies: A nidhi company is a type of company in the Indian non-banking finance sector, recognized under section 406 of the Companies Act, 2013 their core business is borrowing and lending money between their members.
They are also known as Permanent Fund, Benefit Funds, Mutual Benefit Funds and Mutual Benefit Company. These companies are regulated under the Nidhi Rules, 2014 issued by the Ministry of Corporate affairs.
(i) Dormant Companies covered under Section 455 of the Companies Act. 2013 and includes a company which is formed and registered under the Act for a future project or to hold an asset or intellectual property and which has not been carrying on any business or operation, or has not made any significant accounting transaction during the last two financial years, or has not filed financial statements and annual returns during the last two financial years.
(j) Non-banking Financial Companies: A Non-Banking Financial Company (NBFC) is a company registered under the Companies Act, 1956 / 2013 engaged in the business of loans and advances, acquisition of shares/stocks/bonds/debentures/securities issued by Government or local authority or other marketable securities of a like nature, leasing, hire-purchase, insurance business, chit business but does not include any institution whose principal business is that of agriculture activity, industrial activity, purchase or sale of any goods (other than securities) or providing any services and sale/purchase/construction of immovable property.
A non-banking institution which is a company and has principal business of receiving deposits under any scheme or arrangement in one lump sum or in installments by way of contributions or in any other manner, is also a non- banking financial company.
(k) Listed Company: “listed company” means a company which has any of its securities listed on any recognised stock exchange.
The Expert panel which was setup by the Securities and Exchange Board of India (SEBI) has prepared certain draft norms for Social Stock Exchanges (SSE).
SSE is an electronic fundraising platform that allows investors to buy shares in a social enterprise that has been assessed by the exchange.
Such social enterprises include revenue-generating businesses whose primary goal is to achieve a social objective, for example, providing clean energy or healthcare.
Other recent steps which were taken in coal sector include the coal linkages that have been further rationalized in order to reduce the distance in transportation of the coal from the coal mines to the consumer. Under the coal linkage policy, power producers have been linked to the coal producers. The commitments under the linkages are binding and thus, coal cannot be transferred to other consumers.
Environment Protection Act, on the other hand, was amended to drop mandatorily washing coal for supply to thermal power plant. The reason cited was that it prompts industries to import coal. Instead of this, thermal power plants were directed to install the technology for handling ash content.
There were amendments made in the guidelines of preparation, processing and approval of Mining Plan. It was framed into more simplified guidelines. The same was done based on the similar measures which are being taken to formulate an online single window clearance system.
Amendments were also made to Mineral Concession Rule 1960 with the objective to provide more flexibility in the plan and operation.
Mineral Laws (Amendment) Act, 2020 which includes provisions like removal of restriction on end-use of coal, Composite license for prospecting and mining etc. is basically framed with the objective to promote ease of doing business in coal mining.
Alongwith it, announcements made under Atmanirbhar Bharat Abhiyan, mentioning of the spending ₹50,000 crore was done specifying the creation of infrastructure for coal extraction and transport, reimbursement of revenue share payable to government in cases of early production, producing excess of the scheduled target and also for the coal used in gasification etc.
The idea of a SSE for listing of social enterprise is for the voluntary organisations to raise capitals as debt, equity or like a mutual fund which was also as such specified in the Union Budget 2019-20. Later, SEBI constituted a panel to suggest norms for SSEs.
The most prominent SSEs in the world hail from the UK, USA, Canada, Singapore, South Africa and Mauritius.
Numbering the benefits of Social Stock Exchange can be a task as this is bound to certainly unlock funds from donors, philanthropic foundations and Corporate Social Responsibility (CSR) spenders. It might functionally impact investors for social development. As per Brookings India, only 57% of the total social enterprises at the moment have access to debt and equity. This fact stands as a barrier to growth and sustainability. That is certainly expected to change through this.
The Listing of social enterprises in the SSEs would also improve visibility of social enterprises in the eyes of large investors and humanitarian organisations. Also, SSEs will provide a better understanding of social sector to the investors which are routing their investment.
The Banks, NBFCs and other investors can also raise capital from SSE to participate in the growth journey of the social enterprises and thereby deepen their impact in the development.
Further, SSE will help to improve essential social services and important social sectors like health, education, clean energy and agriculture by channelling greater capital to them.
SSE is also expected to unlock large pools of social capital. Furthermore, it is also expected to encourage blended finance structures so that conventional capital can partner with social capital. This will in turn specifically address the urgent challenges of COVID-19.
But there are certain challenges in setting up SSE. Like there is no consensus about what is and isn’t a social enterprise. Prof Muhammad Yunus, a renowned expert in the field defined social business as what can be adopted as “a non-loss, non-dividend paying company which is created and designed to address a social problem.”
The valuing social initiatives, welfare and non-profits organisations is also difficult, because there is no set benchmark, no uniform structures to set minimum thresholds to enable their listing.
Apart from equity capital, social enterprises need debt particularly to meet working capital requirements, but only handful of private impact investors provide debt to early-stage social enterprises.
India at the moment has more than about 2 million social enterprises which includes the non-profits, for-profits and hybrid model and they certainly need careful planning with the designing of the social stock exchange.
Application under section 14 for conversion of public company into private company.
(1) An application under the second proviso to sub-section (1) of section 14 for the conversion of a public company into a private company, shall, within sixty days from the date of passing of special resolution, be filed with Regional Director in e-Form No. RD-l along with the fee as provided in the Companies (Registration Offices and Fees) Rules, 2014 and shall be accompanied by the following documents, namely:-
(a) a draft copy of Memorandum of Association and Articles of Association , with proposed alterations including the alterations pursuant to sub-section (68) of section 2 of the Act;
(b) a copy of the minutes of the general meeting at which the special resolution authorising such alteration was passed together with details of votes cast in favour and or against with names of dissenters;
(c) a copy of Board resolution or Power of Attorney dated not earlier than thirty days, as the case may be, authorising to file application for such conversion;
(d) declaration by a key managerial personnel that pursuant to the provisions of sub-section (68) of section 2 of the Act , the company limits the number of its members to two hundred and also stating that no deposit has been accepted by the company in violation of the Act and rules made thereunder;
(e) declaration by a key managerial personnel that there has been no non-compliance of sections 73 to 76A, 777 , 178,185,186 and 188 of the Act and rules made thereunder;
(f) declaration by a key managerial personnel that no resolution is pending to be filed in terms of sub- section (3) of section 779 and also stating that the company was never listed in any of the Regional
Stock Exchanges and if was so listed, all necessary procedures were complied with in full for complete delisting of the shares in accordance with the applicable rules and regulations laid down by Securities Exchange Board of India: Provided that in case of such companies where no key managerial personnel is required to be appointed, the aforesaid declarations shall be filed any of the director.
(2) Every application filed under sub-rule (1) shall set out the following particulars, namely:-
(a) the date of the Board meeting at which the proposal for alteration of Memorandum and Articles was approved;
(b) the date of the general meeting at which the proposed alteration was approved;
(c) reason for conversion into a private company, effect of such conversion on shareholders, creditors, debenture holders, deposit holders and other related parties;
(d) details of any conversion made within last five years and outcome thereof along with copy of order;
(e) details as to whether the company is registered under section 8.
(3) There shall be attached to the application, a list of creditors, debenture holders, drawn up to the latest practicable date preceding the date of filing of application by not more than thirty days, setting forth the following details, namely:-
(a) the names and address of every creditor and debenture holder of the company;
(b) the nature and respective amounts due to them in respect of debts, claims or liabilities;
(c) in respect of any contingent or unascertained debt, the value, so far as can be justly estimated of such debt: Provided that the company shall file an affidavit, signed by the Company Secretary of the company, if any, and not less than two directors of the company, one of whom shall be managing director, where there is one, to the effect that they have made a full enquiry into affairs of the company and, having done so, have formed an opinion that the list of creditors and debenture holders is correct, and that the estimated value as given in the list of the debts or claims payable on contingency or not ascertained are proper estimates of the values of such debts and claims that there are no other debts, or claims against, the company to their knowledge.
(4) A duly authenticated copy of the list of creditors and debenture holders shall be kept at the registered office of the company and any person desirous of inspecting the same may, at any time during the ordinary hours of business, inspect, and take extracts from the same on payment of ten rupees per page to the company.
(5) The company shall, at least twenty-one days before the date of filing of the application
(a) advertise in the Form No.INC.25A, in a vernacular newspaper in the principal vernacular language in the district and in English language in an English newspaper, widely circulated in the State in which the registered office of the company is situated;
(b) serve, by registered post with acknowledgement due, individual notice on each debenture holder and creditor of the company; and
(c) serve, by registered post with acknowledgement due, a notice to the Regional Director and Registrar and to the regulatory body, if the company is regulated under any law for the time being in force
(6)(a) Where no objection has been received from any person in response to the advertisement or notice referred to in sub-rule (5) and the application is complete in all respects, the same may be put up for orders without hearing and the concerned Regional Director shall pass an order approving the application within thirty days from the date of receipt of the application.
(b) Where the Regional Director on examining the application finds it necessary to call for further information or finds such application to be defective or incomplete in any respect, he shall within thirty days from the date of receipt of the application, give intimation of such information called for or defects or incompleteness, on the last intimated e-mail address of the person or the company, which has filed such application, directing the person or the company to furnish such information, to rectify defects or incompleteness and to re-submit such application within a period of fifteen days in e-Form No. RD-GNL-5:
Provided that maximum of two re-submissions shall be allowed
(c) In cases where such further information called for has not been provided or the defects or incompleteness has not been rectified to the satisfaction of the Regional Director within the period allowed under sub-rule (6), the Regional Director shall reject the application with reasons within thirty days from the date of filing application or within thirty days from the date of last re-submission made. as the case may be.
(d) Where no order for approval or re-submission or rejection has been explicitly made by the Regional Director within the stipulated period of thirty days, it shall be deemed that the application stands approved and an approval order shall be automatically issued to the applicant.
(9) (i) Where an objection has been received or Regional Director on examining the application has specific objection under the provisions of Act, the same shall be recorded in writing and the Regional Director shall hold a hearing or hearings within a period thirty days as required and direct the company to file an affidavit to record the consensus reached at the hearing, upon executing which, the Regional Director shall pass an order either approving or rejecting the application along with reasons within thirty days from the date of hearing, failing which it shall be deemed that application has been approved and approval order shall be automatically issued to the applicant.
(ii) In case where no consensus is received for conversion within sixty days of filing the application while hearing or otherwise, the Regional Director shall reject the application within stipulated period of sixty days: Provided that the conversion shall not be allowed if any inquiry, inspection or investigation has been initiated against the company or any prosecution is pending against the company under the Act.
(10) On completion of such inquiry inspection or investigation as a consequence of which no prosecution is envisaged or no prosecution is pending, conversion shall be allowed.
(11) The order conveyed by the Regional Director shall be filed by the company with the Registrar in Form No. lNC-28 within fifteen days from the date of receipt of approval along with fee as provided in the Companies (Registration Offices and Fees) Rules, 2014.
(1) Appointment process of independent directors shall be independent of the company management; while selecting independent directors the Board shall ensure that there is appropriate balance of skills, experience and knowledge in the Board so as to enable the Board to discharge its functions and duties effectively. Independent director may be selected from Databank.
(2) The appointment of independent director(s) of the company shall be approved by the company at the meeting of the shareholders.
(3) The explanatory statement attached to the notice of the meeting for approving the appointment of independent director shall include a statement that in the opinion of the Board, the independent director proposed to be appointed fulfils the conditions specified in the Act and the rules made thereunder and that the proposed director is independent of the management. It shall also indicate the justification for choosing the appointee for appointment as Independent Director.
(4) The appointment of independent directors shall be formalized through a letter of appointment, which shall set out:
(a) The term of appointment;
(b) The expectation of the Board from the appointed director; the Board-level committee(s) in which the director is expected to serve and its tasks;
(c) The fiduciary duties that come with such an appointment along with accompanying liabilities;
(d) Provision for Directors and Officers (D and O) insurance, if any;
(e) The Code of Business Ethics that the company expects its directors and employees to follow;
(f) The list of actions that a director should not do while functioning as such in the company; and
(g) The remuneration, mentioning periodic fees, reimbursement of expenses for participation in the Boards and other meetings and profit related commission, if any.
(5) The terms and conditions of appointment of independent directors shall be open for inspection at the registered office of the company by any member during normal business hours.
(6) The terms and conditions of appointment of independent directors shall also be posted on the company’s website.
(7) He shall be hold office for a term of upto 5 consecutive years of a company. [Section 149(10)]
RE-APPOINTMENT OF AN INDEPENDENT DIRECTOR
The re-appointment of independent director shall be on the basis of report of performance evaluation. (
Schedule IV – Code for Independent Directors)
Section 149(11) provides that the Independent Director shall be eligible for re-appointment on passing of special resolution. He shall not hold office for more than 2 consecutive terms, but such independent director shall be eligible for appointment after the expiration of 3 years of ceasing to become an independent director. However, he shall not, during the said period of 3 years, be appointed in or be associated with the company in any other capacity, either directly or indirectly.
Eduindex 
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