In this article, Anu Bhatnagar discusses the water laws prevalent in India.

Introduction

• In the words of the United Nations Development Programme (UNDP), water is ‘the stuff of life and a basic human right’.[1] Thus, water is a vital component always – together with human life – on earth and as a result’s a core concern in law. From a legal perspective, the UNDP justifiedly emphasizes the importance of the right dimension of water.
• Yet, in observe, water law is created of variety of parts comprising somebody’s right dimension, as well as economic, environmental or agricultural aspects. Above all, traditionally, one amongst the central issues of water law has been the event of principles regarding access to and management of water.
• At the domestic level, colonial legislation 1st targeted on the regulation of water for economic reasons, for example, through the development of legislation regarding irrigation and navigation.
• Over the past few decades, increasing water pollution and decreasing per capita availableness have junction rectifier to the event of different measures like water quality regulation and a stress on water delivery, significantly in cities, furthermore as environment-related measures.
• Yet, water law remains mostly sectoral to-date. At the international level, water regulation 1st targeted totally on navigation in international watercourses. It’s increasingly evolved to embrace problems regarding the sharing of high sea.
• International water law has, however, not however reached the stage wherever it provides Associate in medicate overall regime for the regulation of water uses. In India, water law is created of various parts. It includes international treaties, federal and state acts. It also includes variety of less formal arrangements, as well as water and water-related policies further as customary rules and rules.
• This paper maps out the relevant legal framework regarding water in Republic of India.
• The first section delineates water law because it evolved till recently.
• The second section then examines planned and ongoing water law reforms that square measure within the method of fully redrawing India’s water legal framework.

FOUNDATION OF THE EXISTING WATER LAWS IN INDIA

Existing water law is formed from variety of various instruments. This can be the case at the international level where solely sure aspects of water law are developed and wherever no international water law written agreement exists. This is conjointly the case among India wherever it remains troublesome to spot a coherent body of comprehensive law concerning water. This can be associated with the very fact that distinct issues are self-addressed in several enactments. This is conjointly owing to the division of powers between the centre and therefore the states and therefore the indisputable fact that water regulation is mostly within the hands of the states.

This section initially highlights  the salient international instruments relevant in India. It then moves on to look at existing water regulation in the India and therefore the totally different principles that govern differing types of jurisdictions relating to water.

SUBJECT TO INTERNATIONAL FRAMEWORK

International water law includes variety of instruments. They’ll not all apply directly in the Asian nation, however, contribute in numerous ways that to the event of water law at the international additionally as national levels.

For many years, international water law enclosed principally treaties regarding navigation in international rivers, which ingrained one in all the first areas of collaboration among states.

• This has been expanded to many non-navigational aspects over time but the focus on international watercourses remains an important part of water law, as exemplified in the Farakka treaty.[2]
• Indeed, the only multilateral treaty in the field of water is a convention concerning non-navigational uses of international watercourses.[3]
• This treaty adopted in 1997 provides a framework for cooperation among states on international watercourses concerning the use of their waters apart from navigational aspects.[4]
• The basic principle it proposes for using international watercourses water is equitable and reasonable utilization.[5]
• The basis for watercourse use is therefore agreement among concerned states concerning their respective needs. While there was substantial debate concerning the place of environmental aspects and sustainability, the principle of sustainable utilization has not been adopted as a principle that would override equitable and reasonable utilization[6].
• The adoption of the convention was in itself a landmark development since it took UN member states many years to agree on this text.[7]
• Besides the UN 1997 Convention, there exist a number of international treaties that are directly or indirectly concerned with water. The UNECE Convention on impact assessment applies, for instance, in the case of dams and other water-related infrastructure projects.[8]
• The Desertification Convention clearly links water and desertification. In fact, its objectives provision recognizes that rehabilitation, conservation and sustainable management of water are key to combating desertification.[9]
• The Convention on wetlands of international importance (Ramsar Convention) is intrinsically concerned with water[10]

EXISTING LEGAL FRAMEWORK IN INDIA

• National water law is additionally developed than international water law. Yet, India lacks Associate in nursing umbrella framework to regulate fresh altogether its dimensions. The prevailing water law framework in India is defined by the existence of variety of various principles, rules and acts adopted over several decades.
• These embrace common law principles and irrigation acts from the colonial amount also as more modern regulation of water quality and the judicial recognition of somebody’s right to water. The dearth of Associate in nursing umbrella legislation at the national level has ensured that the various state and central legal interventions and alternative principles don’t essentially coincide and may in truth be con in bound cases.
• Thus, the claims that landowners have over groundwater underneath common law principles might not be compatible with a legal framework supported the right to water and therefore the need to all or administer water preferentially to domestic use and to produce water to all, whether or not landowners or not on a equal basis.

The existing legal framework concerning water is complemented by a human rights dimension. While the Constitution does not specifically recognize a fundamental right to water, court decisions deem such a right to be implied in Article 21 (right to life).[11] The right to water can be read as being implied in the recognition of the right to a clean environment. In Subhash Kumar v. State of Bihar, the Supreme Court recognized that the right to life ‘includes the right of enjoyment of pollution free water and air for full enjoyment of life.’[12] In the Sardar Sarovar case, the Supreme Court went further and directly derived the right to water from Article 21. It stated that ‘[w]ater is the basic need for the survival of the human beings and is part of right of life and human rights as enshrined in Article 21 of the Constitution of India’.[13] While the popularity of a basic right to water by the courts is unequivocal, its implementation through policies and acts isn’t as advanced.

Water law includes variety of alternative laws and laws that area unit directly or indirectly involved with water. One example issues dams. Two among many there are major aspects of dam building area unit regulated by laws and laws, which are only partially involved with water.

• The general image, that emerges is that of a multiplicity of principles and rules, a multiplicity of instruments and the lack of Associate in medicate overall framework. Whereas bound principles have remained comparatively constant till recently like the assertion of the state’s right to use surface waters within the public interest, there are varieties of changes over time within the basic structure of water law, from the popularity of a personality’s right to water to the introduction of the public trust belief.
• One general trend, which may be highlighted, is that the gradual formalization of water law. In most cases, this has had the impact of displacing or termination existing native rules and arrangements. In other words, the introduction of water laws is commonly not exhausted a vacuum, as can be the case inbound different fields. This is as a result of the actual fact that water has perpetually been of central importance in most communities and formal or informal rules, supported social, spiritual or castes have existed in most places for hundreds of years.

WATER LAWS IN INDIA: A FINAL REMARKS

Water law is created of a variety of formal and informal laws, rules and principles. It’s evolved over time during a relatively uncoordinated and accidental manner. This began to amendment with the progressive realisation that existing laws were inappropriate to confirm access to water to all or any for domestic functions and inappropriate owing to the fast increasing use of a finite resource.

• Over the past number of decades, an additional coordinated effort at dynamical water law has been place in situ. This can be supported a comparatively specific set of principles that area unit meant to guide the overall development of water law. This can be meant to form water law appropriate to face the challenges of the water sector within the twenty first century.
• While water law reforms area unit quite welcome given existing issues with water, it’s unlikely that law reforms based on the principles argue within the water sector reforms represent associate applicable response.
• Current water law reforms might contribute to enhancing water management however they’re conceptually incapable of addressing the human right, social, environmental and health aspects of water. this can be unfortunate as a result of any water law, which is not supported the constitutional right to water and also the principle of charitable trust, is absolute to fail as a legal tool and in its implementation as so much because the overwhelming majority of individuals worries.
• Yet, avenues do exist to broaden reforms of water law. At the international level, some treaties are leading the approach towards conceiving water law a lot of broadly speaking.
• Thus, the United Nations Economic Commission of Europe has adopted a convention, that is broader than the 1997 United Nations Convention in scope to that degree because it applies to transboundary waters in general. it’s additionally supported a  lot of progressive set of principles.
• This includes not solely the very fact that it powerfully emphasise the necessity to stop and scale back transboundary damage however additionally that it’s supported the preventive principle and inter-generational equity. The UNECE convention reflects far more than the UN convention developments in environmental law and connected principles that have come back to tell all treaties regarding environment and development problems.
• The convention is additionally opened to universal membership even supposing different states haven’t legal it nevertheless. Similarly, at the national level, countries like Brazil and South Africa have adopted water laws that ask for to produce a comprehensive regulative answer to the issues known. While the adoption of comprehensive federal water legislation isn’t a precondition to confirm that water law achieves its social, human rights and environmental goals, this may represent associate degree acceptable start line to understand the right to water and therefore the principle of trust throughout the country.

References

[1] United Nations Development Programme, Human Development Report 2006 – Beyond Scarcity: Power, Poverty and the Global Water Crisis 1 (New York: UNDP, 2006).

[2] Treaty on Sharing of the Ganges Waters at Farakka, New Delhi, 12 December 1996, 36 Int’l Leg. Mat. 519 (1997).

[3] Convention on the Law of the Non-navigational Uses of International Watercourses, New York, 21 May 1997, reprinted in P. Cullet & A. Gowlland-Gualtieri eds, Key Materials in International Environmental Law 481 (Aldershot: Ashgate, 2004).

[4] Id. Article 1.

[5] Id. Article 5.

[6] See, e.g., Patricia Wouters, The Legal Response to International Water Scarcity and Water Conflicts: The UN Watercourses Convention and Beyond 20 (Dundee, 2003), available at http://www.dundee.ac.uk/iwlri/Documents/ Research/IWLRI%20Team/Wouters/GYIL.pdf.

[7] The mandate for the development and codification of the law of non-navigational use of international watercourses was first given to the International Law Commission in 1970. See General Assembly Resolution 2669 (XXV), Progressive Development and Codification of the Rules of International Law Relating to International Watercourses, 8 December 1970.

[8] Convention on Environmental Impact Assessment in a Transboundary Context, Espoo, 25 February 1991, reprinted in Cullet & Gowlland-Gualtieri, note 3 above at 29. This convention is open for global membership though India has not joined yet

[9] Article 2, United Nations Convention to Combat Desertification in Those Countries Experiencing Serious Drought and/or Desertification, Particularly in Africa, reprinted in Cullet & Gowlland-Gualtieri, note 3 above at 267.

[10] Convention on Wetlands of International Importance Especially as Waterfowl Habitat, Ramsar, 2 February 1971, reprinted in Cullet & Gowlland-Gualtieri, note 3 above at 248.

[11] See generally S. Muralidhar, ‘The Right to Water: An Overview of the Indian Legal Regime’, in Eibe Riedel & Peter Rothen eds., The Human Right to Water 65 (Berlin: Berliner Wissenschafts-Verlag, 2006).

[12] Paragraph 7, Subhash Kumar v. State of Bihar, AIR 1991 SC 420.

[13] Paragraph 274, Narmada Bachao Andolan v. Union of India, Writ Petition (Civil) No. 319 of 1994, Supreme Court of India, Judgment of 18 October 2000, AIR 2000 SC 3751, reproduced in Philippe Cullet ed., Sardar Sarovar Dam Project: Selected Documents (Aldershot: Ashgate, forthcoming 2007).

In this article, Pranav does A comparative analysis of the Narcotics Drugs and Psychotropic Substance Act, 1985 and The Indian Evidence Act, 1872.

The Indian Evidence act and the Narcotic Drugs and Psychotropic Substances Act (hereinafter referred to as the NDPS act) are two very different pieces of legislation. The Indian Evidence act provides for the types of evidence that can be relied upon by the courts, the evidence which the courts cannot look at and also the age that is to be given to the evidence. The NDPS Act, on the other hand, was enacted in the year 1985 in order to curb the growing menace of drugs in the country. The NDPS Act has certain provisions which overlap with certain provisions of the Indian Evidence Act, in this paper, we look at two such overlapping aspects, one is the provisions for search and seizure, the other is the aspect of confessions. Sections 40, 42 and 50 are the provisions for search and seizure in the NDPS act, and in many cases the Hon’ble Courts have held that strict application of these provisions needs to be there for the evidence obtained to be admissible before the court, with the help of relevant case laws we will see the conflict between the two legislations in this aspect. Secondly we have Section 67 of the NDPS act which talks about confessions, now the question arises as to whether section 25 of the Indian Evidence Act which is applicable to the confessions made to a police officer under the Indian Evidence Act would be applicable to the NDPS act as well. In this paper we seek to answer these questions with an analysis of the relevant provisions and the relevant case laws and look at the overlapping between the two legislations.

The process and the basis of admissibility of the seized substance under the NDPS Act and the Indian Evidence Act stand on two different. The study highlights the differences between the and the rationale behind the same. The law under NDPS Act is devoid of a single and standard interpretation as to what would be regarded as admissible with regard to a search and seizure, the judicial pronouncements have therefore played a significant role in bringing a uniformity in the special legislation. The papers also throws light on the principle of onus of proof, which as a general rule of criminal law lies on the prosecution, however, the same principle has been applied in reverse under the NDPS Act.

Confessions

Section 67 of the NDPS act reads as,

“Any officer referred to in Section 42 who is authorised in this behalf by the Central Government or a State Government may, during the course of any enquiry in connection with the contravention of any provision of this Act, –

(a) Call for information from any person for the purpose of satisfying himself whether there has been any contravention of the provisions of this Act or any rule or order made thereunder;

(b) Require any person to produce or deliver any document or thing useful or relevant to the enquiry;

(c) Examine any person acquainted with the facts and circumstances of the case.”[1]

Section 25 of the Indian Evidence Act reads as,

“Confession to police officer not to be proved.—No confession made to a police officer1, shall be proved as against a person accused of any offence.—No confession made to a police officer1, shall be proved as against a person accused of any offence.”[2]

This provision implies that confessions made to a police officer are inadmissible as evidence in a court of law as there is always a possibility that it may have been obtained by coercion. Now the question arises as to whether this provision would be applicable to information obtained by the officer exercising his power obtained by way of Section 67 of the NDPS Act.

Another question that arises from this Section is whether the officer so empowered under the NDPS Act qualifies as a police officer so as to attract the ire of Section 25 of the Evidence Act.

These questions have been answered by the Supreme Court of India in a number of cases which we shall analyse in order to answer these questions convincingly. First is the case of Kanhaiyalalv. Union of India.[3]

In this case the Assistant Narcotics commissioner received news that opium was being smuggled, based on this information a raiding party was appointed and duly sent to the suspected place, upon reaching the place in question they saw that two persons were sitting near a well with 3 bags, upon seeing the raiding party one of the accused ran away. After this the raiding party questioned the remaining accused and searched the 3 bags from which opium was found. This accused identified the other two persons involved, one of whom was Kanhaiyalal who was later summoned before the investigating officer, who recorded his statement in which Kanhaiyalal confessed. Later he retracted his confession and thus the question as to wether Section 67 would invoke the ire of Section 25 of the Indian Evidence Act.

In this case theHon’ble Supreme Court of India held that, “

“Since it has been held by this Court that an officer for the purposes of Section 67 of the NDPS Act read with Section 42 thereof, is not a police officer, the bar under Sections 24 and 27 of the Evidence Act cannot be attracted and the statement made by a person directed to appear before the officer concerned may be relied upon as a confessional statement against such person. Since a conviction can be maintained solely on the basis of a confession made under Section 67 of the NDPS Act, we see no reason to interfere with the conclusion of the High Court convicting the appellant.”

From this judgement it can be ascertained that the officers empowered under Section 42 of the act would not qualify as police officer and thus would not attract the penalty of Sections 24 to 27 of the evidence act.

The Court has in MohteshamMohd. Ismail v. Spl. Director, Enforcement Directorate[4]  held as under, “We may, however, notice that recently in Francis Stanly v. Intelligence Officer, Narcotic Control Bureau, Thiruvananthapuram this Court has emphasised that confession only if found to be voluntary and free from pressure, can be accepted.

A confession purported to have been made before an authority would require a closer scrutiny. It is furthermore now well settled that the court must seek corroboration of the purported confession from independent sources.“

Thus even though Sections 24 to 27 are not attracted, the courts still need to ensure the validity of the confession in order to ensure no injustice is meted out to the accused.

In 2009 the Hon’ble Court in Noor Aga v. State of Punjab[5] differed from the earlier view and held that custom officers empowered under the NDPS act would qualify as Police officers and thus Section 25 of the Indian Evidence act would be applicable to statements recorded under this section. In this case the court talked about how the presumption with respect to the innocence of the accused must be respected at all times and the court held that customs officers must be deemed to be police officers here as a special statute invested them with powers of an officer-in-charge of a police station. Since legal fiction must be given full effect, and section 25 must be applicable to confessions made before such officers as well.

Thus in this case we saw a change in the ideology of the Supreme Court as it took a restricted view so as to include the officers so empowered under the ambit of Section 25.

In 2011 in the case of Ram Singh v. Central Bureau of Narcotics[6], the court stated that S. 53 alone would be insufficient to hold officers of the Narcotics Bureau as police officers since it did not confer the necessary power of filing a charge sheet. However, the judicial see-saw turned to favour the conclusions of Noor Aga.[7]

In this case the court held that the officers could not qualify as police officers since they did not have the power to file a charge sheet under section 173 of the Crpc. The court decided that, “it is clear that a statement made under Section 67 of the NDPS Act is not the same as a statement made under Section 161 of the Code, unless made under threat or coercion. It is this vital difference, which allows a statement made under Section 67 of the NDPS Act to be used as a confession against the person making it and excludes it from the operation of Sections 24 to 27 of the Evidence Act.”

With respect to the applicability of Section 24 of the Indian Evidence Act, the court decided that, “

“From the plain reading of the aforesaid provision it is evident that a confession made by an accused is rendered irrelevant in criminal proceeding if the making of the confession appears to the Court to have been caused by any inducement, threat or promise with reference to the charge against the accused. A confession, if it is voluntary, truthful, reliable and beyond reproach is an efficacious piece of evidence to establish the guilt of the accused. However, before solely acting on confession, as a rule of prudence, the Court requires some corroboration but as an abstract proposition of law it cannot be said that a conviction cannot be maintained solely on the basis of the confession made under Section 67 of the Act.”

Thus from this extract, we can establish that the statements recorded under Section 67 of the act can theoretically be enough to convict an accused but in almost every case there would be a need for corroborative evidence to support such statement.

The current position is that only those officers empowered under law to carry out investigation and file a charge sheet would qualify as police officers for the purpose of Section 25 of the act, but this stance has certain repercussions. There exists a latent fear of abuse of the power by the officers so empowered to extort confessions from the accused. The whole purpose of Section 25 is to remove the possibility that the confession has been obtained as a result of coercion. This is why the Calcutta High Court in S. Fernandez v. State was so explicit in its disapproval of considering the power of investigation as the governing test in applying Section 25[8]; similar thoughts were echoed by Subbarao J. in his dissent in Barkat Ram. Where powers of arrest, detention, search and seizure are conferred upon officers, but the entire catalogue of investigative powers of police officers are not, a refusal to extend Section 25 to such circumstances patently defeats the object of the provision.[9]

Even if we assume that there is merit in this view of keeping investigative powers as the bar to determine the liability of the officer, the step of singling out the power to file the charge sheet as the test still doesn’t make sense. A charge-sheet would enable the Magistrate to take cognizance and ultimately begin trial. Therefore, for the Apex Court, all other powers of investigation made little difference if the power to prosecute is absent. Apart from the obvious certainty ushered in by such a test, I believe it provides little value otherwise. This test has its downfalls.

Firstly, adhering steadfastly to such a rigid notion of who can be a police officer makes the Court ignorant to obvious legislative conferrals of power. In the Raj KumarKarwal, Section 53 of the NDPS Act had given the officer powers of a station house officer for investigation of offences. The Court, however, did not consider this sufficient to apply Section 25, as the power to file a charge-sheet was not vested with the officer.[10] This went directly against an earlier judgements, including the earlier Supreme Court decision in Jaiswal.[11] I believe that the decision given in the Noor Aga case should be seen to be the authority in this question and that view should be reiterated by the Supreme Court.

This is the stance with regard to the relation between Section 25 of the Indian Evidence act and Section 67 of the NDPS act.

Admissibility of Seized Substances

The admissibility of the contraband substance under Section 50 of the NDPS act is covered with a blanket of complexities. The substance seized under Section 50 has to be under strict compliance, and in failure to comply with the same the material would lose its evidentiary value.

A Sub-Inspector who was present on platform for checking smuggling and other antisocial elements, on suspicion, nabbed him and found that he was carrying poppy straw weighing 7 kgs. in the bag. It was held that the Police Officer had neither information, nor knowledge nor reason to believe that the offence under the NDPS Act had been committed and therefore section 50 was not applicable.[12] The prior acts of the police authority also form a part of the fact. The essence of the same makes a seizure process admissible or inadmissible before the court of law. The SC further held that the police in those circumstance could have reason to ‘suspect’ that some contraband could be found but they had no ‘reasons to believe’ that contraband could be found; suspicion cannot be equated with reasons to believe.[13]

Section 114 illustration e of The Evidence Act cannot be pressed into service to raise a presumption that Section 50 was complied with.[14]It was also considered and the argument that the contraband seized during an illegal search could still be used to prove possession of narcotic drug, was rejected in the matter of Ali Mustaffa Abdul Rahman Moosa v.Kerala.[15] It is, therefore, evident that the non-compliance of the evidence would make the seizure process illegal and the same could vitiate the trial. Therefore the same would lead to acquittal of the suspect.

However a trial solely on the basis of the Evidence Act lies on the different horizon. The legality of the seizure process is not in issue even when the evidence has been illegally collected. Evidence collected in a search in violation of law does not become inadmissible in evidence under the Evidence Act[16]. There is warrant for the proposition that even if evidence is illegally obtained, it is admissible.[17]The validity of the the seizure is not effected, at the most it can only force the court to be on guard in examination of the evidence.[18]The apex court has also held that there is no statutory bar in the usage of the evidence that are illegally collected.[19]

When acting on prior information duty to inform the suspect of his right under Section 50 is imperative and failure in this regard would cause prejudice to the accused. Failure to take the suspect to nearest Magistrate or a gazette Officer if he opts for it, would render recovery suspect and vitiate the conviction. Use of evidence collected in breach of safeguards provided in Section 50 would render the trial unfair.[20]

The form that the policemen have to follow in establishing that the accused has a right to be searched in front of the magistrate has passed through a lot of development. The accused in the matter of  Joseph Fernandez vs. State of Goa the accused was told that “If you wish you may be searched in the presence of a gazetted officer or a Magistrate” and the court held that the same was in substantial compliance of Section 50[21]. In another case where the suspect was informed that, “You would like to give me search or you would like to be searched by a gazetted officer or by a Magistrate” this was also held to in substantial compliance.[22] The court however held on a different footing that it is the right of the accused and he should me made aware of this, the court emphasized on the substance and not on the intimation.[23]

The rights of the suspect lies in the heart of this special statute, the Evidence Act takes into consideration the larger prospects of a crime free society. The intention of the legislators of the NDPS Act too did not divert much from the object of the mother Act, however due to the grave nature of the punishment inflicted upon the guilty the law makers just wanted it to be a process devoid on any glitches.

Onus of proof

The principle of onus probandi has been enshrined in the Indian  Evidence Act. The principle states that “ On every issue, there is an obligation on one party to convince the tribunal of the truth of some proposition of fact which is in issue and which is vital to his case.[24] Section 101 of the Act provides that the burden of proof lies on the person who says that the accused has committed the crime[25]. The burden of proof therefore lies on the party which makes the claim and not the one who is defending it.[26] It is therefore a well established proposition of the Indian Evidence Act that it is the responsibility of the person making the claim to clearly establish his facts. It is only when the prosecution has established his fact,  section 105 of the same Act prompts the shifting of the burden on the defence and the defence is to put forward the exceptions[27]. The case of K.M. Nanavati which created a sensation in the  Indian judiciary laid down the proposition that the burden on the accused under S.l05 is not so onerous as the burden on the prosecution, and can be discharged by a balance of probabilities.[28] The burden so created can be done away with reasonable doubt[29] and an indirect acquittal can be provided for the same[30].

However the NDPS Act on the other hand provides for a strong revere onus clause, which initiates the burden of proof for the accused. Section 54 of the Narcotics Drugs and Psytrophic  Substances Act, 1985 states that there lies a presumption that the person has committed an offence when he is found in possession of the contraband substance unless it is otherwise proved by the accused[31] and the prosecution under such circumstances need not even prove the illegal possession.[32] Under the special law, the prosecution just has to establish that the accused was in possession of the illicit drug.[33] Therefore it can be said here that the prosecution need not prove all the essentials of the offence, but to prove an offence under the evidence act the prosecution has to establish the fulfilment of the essentials of the offence. When the burden of proof shifts over to the accused under Section 105 of the Evidence Act, the accused need not establish the presence of a valid defence in toto but may simply raise the mens rea of the accused at the time of the commission of the offence[34]. The principle of presumption, therefore, rests upon the construction of the fact that the prosecution has proved the guilt beyond reasonable doubt. [35]Section 35 of the NDPS Act also states that the presumption would be against the mental state of the accused and the same has to be proved beyond reasonable doubt and not merely when its existence is established by a preponderance of probability. The outcome of such sections has been to presume that the accused is guilty merely on the basis of physical possession and not conscious possession[36]. The NDPS act can therefore be said to be one of those special legislations with a strong reverse onus principle, inflicting the burden of proof on the accused. The Special legislation to this regard can be differentiated to a great extent with the Indian Evidence Act. The burden of proof on the Accused with regard to the NDPS Act is higher than that of the Evidence Act.

Conclusion

It is therefore clear that the Evidence Act and the NDPS act vary in the application of various provisions with regard to the admissibility of evidence. The crux of it lying on the grave nature of the offence under the evidence.  The abuse of drugs has been a major concern in a developing nation like India and the same needs to be governed by a strict legislations like the Narcotics Drugs and Psychotropic  Substances Act. The minimum punishment given under the NDPS Act is 10 years and a fine of 2 lakh rupees, since the gravity of punishment being of such high extent the provisions of taking the evidence had to be strictly followed. With the rate of offence increasing, there was a need for enacting certain provisions which would act as a strong deterrent.

References

[1]Section 25, Indian Evidence Act, 1872.

[2]Section 67, Narcotic Drugs and Psychotropic Substances Act. 1984.

[3](2008) 4 SCC 668.

[4](2007) 8 SCC 254

[5](2008) 16 SCC 417.

[6](2011) 11 SCC 347.

[7]http://nujslawreview.org/wp-content/uploads/2015/07/Abhinav-Sekhri.pdf

[8]AIR 1953 Cal 219.

[9]http://nujslawreview.org/wp-content/uploads/2015/07/Abhinav-Sekhri.pdf

[10](1990) 2 SCC 409.

[11][1963] 2 SCR 752.

[12] Gurbax Singh v. State of Haryana (2001) 3 SCC 28

[13] State of HP vs Sunil Kumar AIR 2014 SC 2564

[14] Saiyad Mohd. Saiyad Umar Saiyed vsGujarat (1995) 3 SCC 610

[15] Ali Mustaffa Abdul Rahman Moosa v.Kerala.1995 SSC 244

[16] Himachal Pradesh v. Pirthi Chand 1996 (2) SCC 37

[17] R.M. Malkani, AIR 1973 SCC157.

[18] State of Maharashtra v. Natwarlal Damodardas Soni. AIR 1980 SCC 593.

[19] Pooran Mai v. Director of Inspection, 93 I.T.R. 505 (1974)

[20] State of Punjab vs Baldev Singh AIR 1999 SC 2378.

[21] Joseph Fernandez Vs. State of Goa, AIR 2001 (1) SCC 707

[22] Prabha Shankar Dubey Vs. State of M.P, AIR 2004(2) SCC 56

[23] Krishan Kanwar (Smt.) Alias Thakuraeen Vs. State of Rajasthan, 2004(2) SCC .608.

[24] S.L. Phipson & D.W. Elliot, Manual of the law of evidence 70 (11^th ed. 2001)

[25] Section 101 of the Indian Evidence Act.

[26] Rangammal v. Kuppuswami and Ors. CIVIL APPEAL NO. 562 OF 2003

[27] Section 105, Indian Evidence Act, 1872.

[28] K. M. Nanavati v. State of Maharashtra, AIR 1962 SC 605.

[29]  Parbhoo v. Emperor, 1941 All LJ 619 AIR 1941 All 402.

[30] Rishikesh Singh v. State, AIR 1970 All 51

[31] Section 54, India Evidence Act, 1872.

[32]  Radhakishan Parashar v. State , 1988 Cri. L. J. 17,18

[33] R. V. Hunt, (1987) 1All E.R.1.

[34] Dahayabhai v. State, AIR 1964 S.C. 1563.

[35] Henry L. Chambers Jr., Reasonable Certainty amd Reasonable Doubt, 81 MARQ .L. REV.- 655,671-672

[36] http://nujslawreview.org/wp-content/uploads/2015/02/juhi-gupta.pdf

In this article, Shikhar Shrivastava discusses the remedies available if a party fails to appoint an arbitrator within stipulated time.

Arbitration

Arbitration is a dispute settlement process where parties to an arbitration agreement submit their disputes before one or more Arbitrators, instead of a court of law, for resolution of their legal rights and liabilities. The award/ decision made by that Arbitrator/s is a valid binding decision having force of law on the parties to that arbitration agreement.

International Commercial Arbitration (ICA) means a legal relationship which must be considered commercial, where either of the parties is a foreign national or resident or is a foreign body corporate or is a company, association or body of individuals whose central management or control is in foreign hands.^[1]

Role of an Arbitrator And his/her Appointment

An Arbitrator can be any person from any country agreed by the parties and does not require any certifications or qualifications but, generally, is a retired judges or legal expert or business field expert because they are equipped with good hearing, excellent analytical and reasoning skills, good writing skills, and an ability to quickly learn complex matters.

Appointment of an Arbitrator or Arbitration Tribunal is done in accordance of the arbitration agreement. The source of the jurisdiction of the arbitrator is the arbitration clause/ agreement.

Number of Arbitrators

It is preferable to always have an odd number of arbitrators like one or three etc., so that an award can be made by a majority in case of a divided opinion. Failing any determination by the parties, the arbitral tribunal shall consist of a sole arbitrator.[2]

Objection Against Composition of Tribunal

A party has a right to object to the composition of the arbitral tribunal within prescribed period of time,[3] if such composition is not in accordance with the agreement. Later, it will not be open to the parties to challenge the composition or the award after it has been passed by that arbitral tribunal.

Remedies available to the parties when they fail to appoint an Arbitrator

If one of the parties does not appoint an arbitrator within 30 days, or if two appointed arbitrators do not appoint third arbitrator within 30 days, the party can request the Supreme Court or relevant High Court to appoint an arbitrator.^[4]

A party would forfeit its right to appoint an arbitrator in terms of arbitration clause after the party wishing to exercise such right fails to do so within statutory period of 30 days and the other party makes an application to the court seeking appointment; the court may appoint an arbitrator.

The party can request Chief Justice of India (“CJI”) to appoint an Arbitrator in case of international commercial arbitrations^[5] and in case of domestic arbitrations, application has to be made to Chief Justice of respective High Court within whose jurisdiction the parties are situated.^[6] The Supreme Court/ High Court can authorize any person or institution to appoint an arbitrator.^[7]

Judicial Act or Administrative Act

This appointment of arbitrator would not amount to delegation of judicial power and is to be treated as an exercise of administrative power by the courts. A Constitution Bench of the Supreme Court in Konkan Railway Corporation v Rani Construction Pvt Ltd,[8] unanimously held that the function of appointment is administrative in nature and not judicial. It held that one of the objects of the law is to have the arbitral tribunal constituted as expeditiously as possible.

Duty of Higher Courts While Appointing Arbitrator

The Supreme Court in an ICA, where seat of arbitration is India, and High Courts in domestic arbitrations have to examine the existence of an arbitration agreement at the time of making such appointment.^[9] The arbitrability of the issue would be decided by the arbitral tribunal and not the courts.

The Delhi High Court in Picasso Digital Media Pvt. Ltd. v. Pick-A-Cent Consultancy Service Pvt. Ltd.,^[10] has emphasized that the courts, while deciding an application for appointment of an arbitrator must confine their enquiry to the existence of an arbitration agreement.

The Amendment to the Arbitration Act, 2015 seeks to introduce a timeline for the appointment so that application for appointment of the arbitrator before the Supreme Court or High Court, as the case may be, can be disposed of as expeditiously as possible and an endeavour shall be made to do so within a period of 60 days.

Qualification of Arbitrators

Clause (a) of Sub-section (8) of section 11 of the Act wherein it is specifically provided that the Chief Justice or the person or institution designated by him, in appointing an arbitrator, shall have due regard to any qualifications required of the arbitrator by the agreement of the parties.[11]

Nationality of the arbitrator

Parties are free to agree to the nationality of the arbitrator. It is not mandatory that the arbitrator should be of a nationality other than the nationalities of the parties to the agreement.

Named Person or Authority as Arbitrator

Where the agreement itself specifies and names the arbitrator, it is obligatory upon the court, to refer the dispute to the arbitrator specified in the agreement. Only in cases where the arbitrator specified and named in the agreement refuses or fails to act or where the agreement does not specify the arbitrator and the parties cannot also agree upon an arbitrator, does the court get the jurisdiction to appoint an arbitrator.[12]

Challenge To The Appointment Of An Arbitrator

It can be challenged only if

1. there is justifiable doubts as to his independence or impartiality; or,
2. he does not possess the qualifications agreed upon by the parties.^[13]

Such challenge has to be brought within 15 days after becoming aware of the constitution of the arbitral tribunal or after becoming aware of the circumstance that he does not possess the necessary qualification.[14] Further, the challenge to appointment has to be decided by the arbitrator himself and if he does not accept the challenge then the proceedings would continue and the arbitrator can make the arbitral award.

If the challenge is not successful the tribunal shall continue with the arbitral proceedings and render the award, which can then be challenged by an aggrieved party at that stage. However, application for setting aside the arbitral award can be made to the Court under Section 34 of the Act and if the court agrees to the challenge, the arbitral award can be set aside.^[15]

Conclusion

Section 11 is based on Article 11 of the UNCITRAL Model Law, 1985 which envisages the Chief Justice to perform an administrative function similar to the appointing role that arbitral institutions plays. The Court should not play any active role by deciding the arbitrability of the agreement or decide the matter on merits but it must direct the case to arbitration giving effect to the arbitration agreement between the parties. However, if the Court finds that that the arbitration agreement is null and void, inoperative or incapable of being performed then it may refuse to direct the matter to arbitration.^[16]

Therefore, on the request of a party for appointment of the arbitrator, the Chief Justice or his designate can appoint Arbitrator as per the arbitration agreement or may, for reasons to be recorded ignore the designated arbitrator and appoint someone else on justifiable doubts as to the independence and impartiality of the person nominated.

References

Acts:

• The Arbitration And Conciliation (Amendment) Act, 2015
• The Arbitration And Conciliation Act, 1996
• UNCITRAL Model Law, 1985

Articles:

• International Commercial Arbitration, Law and Recent Developments in India, March 2017, Nishith Desai Associates
• Law Of And Procedure For Appointment Of Arbitrator(S), Ginny J. Rautray and Saurendra Rautray
• The Arbitration Law Of India: A Critical Analysis, Sumeet Kachwaha, Asia International Arbitrational Journal, Volume 1, Number 2, Pages 105-126

[1] Section 2(1)(f) of the Indian Arbitration Act, 1996 (hereinafter to be referred as “Act”)

[2] Section 10(2)

[3] Section 16

[4] Section 11(6) of the Act

[5] Section 11(4) of the Act

[6] Section 11(12) of the Act

[7] Section 11 (6)(b) of the Act

[8] 2002 (2) SCC 388.

[9] Section 11 (6)(a) of the Act

[10] ARB.P. 635/2016

[11] Iron & Steel Co. Ltd. v. Tiwari Road Lines, (2007) 5 SCC 703.

[12] S. Rajan v. State of Kerala, (1992) 3 SCC 608; Rite Approach Group Ltd. v. Rosoboronexport, (2006) 1 SCC 206; Iron& Steel Co. Ltd. v. Tiwari Road Lines, (2007) 5 SCC 703.

[13] Section 12(3) of the Act

[14] Section 13 (2) of  the Act

[15] Section 13(6) of the Act

[16] 2005 (3) ArbLR 1

In this article, Perin Gandhi an Advocate in Mumbai and who is currently pursuing Diploma in Entrepreneurship Administration and Business Law from NUJS, Kolkata, discusses the legal compliances involved in starting an Online Store. Legal compliances for online stores.

Myntra, Ebay, Amazon, Flipkart….. who hasn’t heard of these names before!

Legal compliances for online stores

A decade ago who would have thought that online stores would be successful in replacing the old fashioned retail stores. More than 80% people worldwide would have shopped online at least once in their lifetime. The number of online stores are evolving with each passing day and pushing online shopping to a new height. Gone are the days when the customer were at the mercy of the salesman at the store and had to pick the product from a limited option. E-commerce which is Electronic Commerce has revolutionized in recent years and has become a customer oriented market. India has the fastest growing market for e-commerce. In 2014, E-commerce created a buzz in the global market when the formal sales crossed 1 trillion.

The Information Technology Act 2000 governs the matter whenever there are online disputes in India but the act lacks in many aspect. E-commerce laws and regulations are still evolving in India which has created confusion among many entrepreneurs. There is a misconception that there are less legal compliances for e-commerce companies as compared to the offline counterparts. However, selling online does not actually spare you or lessen your burden of meeting up with the compliances. The law treats both online as well as offline companies as the same. Let’s find out what steps to follow to start an online store:

Structuring Of Business

The first step is to choose the correct business structure for your company and register it. Without registration, the entrepreneur would be exposed to plenty of risks. So it is important to register the company and limit the liability to the amount of investment. E-commerce company can operate in any one of the following structure.

1) Sole Proprietorship, 2) Partnership, 3) Limited Liability Partnership (LLP), 4) Company (Public/Private) and 5) One Person Company.

Raising funds is the ultimate aim of the e-commerce entrepreneur so the most popular choice of business structure for them is opening a private limited company. The process of incorporation of the business is entirely online and can be done through the website http://www.mca.gov.in/. To incorporate a private limited company, the entrepreneur has to approve its name and registered office address. It must have at least two directors with director identification numbers (DINs) and digital signature certificate (DSCs) of the directors. The authorized share capital of the company must be Rs. 1 Lakh. Memorandum of Association (MOA), Article of association (AOA) are also required to complete the formalities of incorporation. Once all these requirements are fulfilled, a certificate of incorporation is issued to the company at its registered office address by the Registrar of Companies (ROC). There are different requirements for different business structure.

Domain Name

Once the business structure of the company is decided they must register the Domain name for their company. For an E-commerce company it is not only important to protect their own intellectual property but also to ensure that they are not violating anyone else’s intellectual property. So while choosing the name one must see to it that it is not similar to an already registered name. Most of the e-commerce companies choose a unique name and file it with Trademark Registry so as to acquire exclusive right over that name.

Recently, a California based PayPal founded by Silicon Valley bigwigs in 1998 filed the objection against the Alibaba backed Indian Company PayTM on November 18th with the registrar of trademarks contesting on the grounds that there were similarities between the logos of the two brands. They registered the complaint on the final day of the four-month time frame given on the PayTM’s advertisement of its trademark application. They were accused of adopting the two-tone blue colour scheme of its logo which could cause confusion among the consumers.

Protection of data

Another crucial task for an e-commerce entity is protecting the data of its customers. Ensuring privacy to every potential customer who visits the Website or portal is utmost important for every E-commerce entrepreneur for building trust with the customers. A  customer is often asked to provide personal and sensitive information while completing the digital payment transaction and other formalities. This has led to a great responsibility upon the online ventures to pay more attention and adhere to the rules related to ‘Data privacy’ and ‘Data protection’. Sensitive Personal Data or Information (SPDI) such as Passwords, Medical records and history, Financial information such as Bank account details and credit card details etc. as provided by the customer has to be protected by reasonable means by such entity as per the Section 43A of the Informational Technology Act, 2000. An online entity has to satisfy the requirement of implementing a reasonable security practice and a standard procedure for ensuring the protection of sensitive datas. The International Standard IS/ISO/IEC 27001 relating to ‘Information Technology-Security Techniques-Information Security Management System–Requirements’ is considered to be the standard required for securing sensitive datas. For the purpose of protecting the data if any entity uses a standard other than the prescribed one then it would require their codes to be approved by the Government of India. As per the rules provided in the Informational Technology Act, 2000 before the E-commerce entity collects personal information of the customers while transacting with them, it is imperative for that entity to get the prior express consent of such customers. The Sensitive and personal information shall only be collected if it is utmost required for the attainment of the purpose and is lawful in nature and shall not be retained by that entity for a period longer than required. The E-commerce entity has to make sure that the customer has the knowledge about the collection of information, the purpose for which it is collected, the agency retaining such information etc.Disclosure of any personal information of the customer to any third party other than a government agency or as required to be disclosed as per the provisions of law, would require the prior permission of the customer. When the E-commerce entity transfers the SPDI for the purpose of fulfilling the commitment towards the customer or where the customer consented for such transfer, they would have to ensure that the third party located anywhere in the world would follow the same level of privacy and adhere to all the rules prescribed in the act. The E-commerce entity would also have to make provisions for dealing with the grievance of the customers reported to them within a specified time. Little negligence on the part of the E-commerce entity in the protection of SPDI would result in loss of reputation and goodwill of that entity.

Privacy Policy And Terms Of Service

Whenever we visit any E-commerce website we often come across disclaimers, privacy policy and terms & conditions. Ever wondered why is it so important to draft such documents? Well, terms of service and Privacy policy are the two most important document for any e-commerce website. The terms and conditions of any website helps to make the customers aware about the rights and responsibilities of the concerned website. It helps in the smooth functioning and also provides a legal cover to the entrepreneur or promoters in case of any liability incurred from any agreement entered with the user or another company. The privacy policy, on the other hand, communicates to the customers of how the e-commerce companies would use the information submitted by the customers and ways in which they would protect their personal information. The Privacy Policy has to be comprehensively published on the e-commerce website so that it is readily available to all the customers visiting the website. Such documents protect the entrepreneurs from being sued under section 43A of the Informational Technology Act, 2000 where the penalty could go up to Rs. 5 Crores.

Vendor/Supplier Agreement

It is utmost required for all the online stores to maintain an agreement with the vendors which are listed in their portal. However, in case one is only selling their goods in such stores and is not running an online store then in that case it is essential to have in place an agreement with their suppliers. It should specifically define the role and responsibility of each party and must include all the relevant clauses and terms to cover issues like default, quality of the product, late delivery, payment etc as per the business model of the company.

Vat/Sales Tax Registration

Whether online or offline, these taxes are applicable in case of sale of tangible goods. For becoming a seller on the e-commerce portal i.e. if someone wants to sell their product on snapdeal, flipkart etc or to run an e-commerce website, Value added tax (Vat) registration is a must for both. The registration for the same should be obtained from the State’s Sales Tax Department once the operation of the e-commerce company begins or soon after registering the business. Central sales tax (CST) is also applicable in case of inter-state trade. Collection of VAT depends on the turnover of the business and it varies from state to state whereas CST can be collected irrespective of the turnover.

Payment Gateway And Related Compliance

Payment gateway is a service used by the e-commerce website to process the payment of the
customers. Payment gateways like PayPal, PayUmoney etc accepts the credit card, debit card, net banking from multiple banks and transfers the money to the bank account of the e-commerce
 company within 2-3 days. However, in order to avail the service of payment gateways, e-commerce entrepreneurs have to submit documents like Bank account in the name of the company, certificate of incorporation, Memorandum of Association, Articles of Association, PAN card of the company, Address proof, Privacy policy and terms of service of the concerned website.

Further, Banking and Financial requirements are to be complied with for such transfer and online shopping in India. For example, say if PayPal has to allow online receipt and other expenditure for any e-commerce activity, it has to first obtain the license from Reserve Bank of India (RBI).

Other Compliances

E-commerce Companies are required to comply with the provisions of contract law, Indian Penal Code, Labour laws etc. Various states have implemented the obligation of obtaining Shop and Establishment license for opening offices. The registration under the Shop and Establishment Act has to be done within 30 days from commencing the work.

The Cyber laws of India has become very stringent and which requires e-commerce entrepreneurs to ensure cyber law due diligence in India. Many online websites, foreign companies, and even Indian companies are frequently prosecuted for non-compliance of the same.

Legal compliance for e-commerce companies differ with each category of business. Say for example the legal compliance in case of an e-commerce company undertaking electronic trading of medical drugs is more stringent as compared with other e-commerce activity. Digital trading of any health products attracts more scrutiny than other products. Failing to comply with the legal requirements would lead to legal notice to the company.

The Information Technology (Intermediary Guidelines) Rules 2011 lays down stringent liability for e-commerce sites in India. So a proper digital due diligence is advisable before commencing any e-commerce websites.

This was all on legal compliances for online stores. Any doubt on legal compliances for online stores? Comment below and let us know.

In this article, Shikhar Shrivastava discusses Employer’s responsibilities for Tax Filing of Employees.

Tax filing is the act of providing the detailed account of one’s income received in a financial year with the Income Tax Department. Non performance on the part of income receiver will lead to penal payment if the total income received is above the maximum waived tax limit. The employer is also required to deposit the tax so deducted in Government account within the prescribed time and format as per Section 200 of the IT Act. The tax has to be deposited to the credit of the Central Government in any of the branches of RBI, SBI or any authorized bank either in cheque or cash or draft drawn on local banks.

Why Employer Deducts Income Tax From Employee’s Salary

Income Tax Act 1961 casts a duty on every individual to pay tax when his total taxable income exceeding the non taxable limit and that’s why the employer deducts TDS (Tax Deduction at Source) from salary of employee every month and remits the same to the Income Tax Department within the due dates.

Sub-Section 2 of Section 192 provides that where a person has more than one employer, he may furnish the particulars of salary payments and TDS to the employer of his choice.^[1]

How TDS Is Calculated

TDS is calculated by the employer considering the declared investments and expenses that are either Tax Exempted (or) eligible for tax deductions under Income Tax Act. Employee need to submit both IT investment declaration and Investment proofs (documents) to his employer. If he do not submit the required investment proofs at the year end, the employer will then be forced to deduct complete tax without considering your provisional investments (IT Declaration).

While calculating TDS liability, the total salary of an individual for the year is estimated; relevant deductions like interest on home loans, tax-savings under section 80-C and 80-D are deducted, and taxes due on net income are calculated according to the relevant slab rates.[2]

The present slab rates, income up to Rs 2,50,000 is exempt from tax;  Rs 2,50,000-5,00,000 is taxed at 10 per cent income, Rs 500,000 to Rs 10,00,000 is taxed at 20 per cent, and any income above Rs 10,00,000 is taxed at 30per cent.

Informing New Employer About the Previous Salary

When an Employee joins a new Employer in the middle of a financial year then it is his duty to inform the new Employer about the Salary he has received along with the Form 16 provided to him by his previous Employer. The Employee may ignore or forget to do this but his act would amount to concealment of the information and he may end up paying penal amount of tax which may go up to 300% of the tax amount not deposited.

Why Income Declaration To New Employer Is Required

When an individual changes jobs, the new employer too calculates salary income for the financial year and if the individual does not declare to the new employer salary income from the previous one, the new employer would calculate TDS liability only over the salary which employee is receiving in the present employment.

So, when the old salary has not been declared to the new employer, the individual is being given the benefit of tax savings under section 80-C and 80-D twice by virtue of both the employers providing such deductions. Further, the individual enjoys the income tax slab benefit in both cases as the old and new salary are taxed separately.

The problem will arise while filing annual tax returns which will turn out to be a huge liability for the individuals. Such unforeseen events could also disrupt financial planning of individuals to settle this liability.

Therefore, the employee must see to it that he has declared his past employment income to the present employer and the same has actually been taken into account for the TDS calculations by the new employer or he would have to take help of an expert to self-manage the liability and pay it by way of advance tax installments.[3]

Employer’s Duty To Issue Form 16

Form 16 is a certificate issued by the employer to its employees for each financial year, under section 203 of the Income-tax Act, 1961, by 31 May of the assessment year (AY). If an employer delays or does not issue the form on time, he can be penalized. If the forms are not issued by then, under section 272A(2)(g) of the I-T Act, the employer is liable to pay a penalty of Rs.100 per day of default till it issues the form. If there was no TDS on the income, then the employer can decline to issue the form of that employee. Employees can approach the accessing officer (AO), under whose jurisdiction he has to file his ITR, and give a written complaint against the defaulting employer. Based on the complaint, the AO may take appropriate action or initiate penalty proceedings against the employer.

Importance Of Form 16

It provides information on tax deducted at source (TDS) from income chargeable under the head “salaries”. It has two sections—part A and part B.

Part A primarily has TAN & PAN details of employer & employee and details of tax deducted & deposited which is certified by the employer, TDS Certificate Number. Part B has other remaining details such as- details of salary paid, amounts deductible under chapter VIA, relief under section 89. Part B is prepared by the employer manually and issued along with Part A. If the person is employed under more than one employer during the year, each of the employers shall issue Part A of Form 16 for the person such a person was employed with each of the employers.^[4]

Total deductions are aggregated under “Chapter IV-A” and reduced from gross income to arrive at the taxable income and tax liability is calculated on this amount. Part B gives details of tax payable by the employee or refundable to him.

Employee’s Duty When Employer Defaults To Conduct TDS

It may appear that TDS is the obligation of the employer only but if an employee is aware about a TDS default, then the employee is under an obligation to pay tax through the advance tax route or self-assessment tax as ultimately, taxes are to be deposited on his income.[5]

TDS certificate

TDS certificate in Form 16 is only required to be issued to the employee when TDS has been deducted. In case no TDS has been deducted by the employer he may not issue a Form 16.

An employer is compulsorily required to furnish a TDS certificate, in the format of Form 16, specifying that tax has been paid to the Central Government, with the amount so paid, the rate at which the tax has been paid and other prescribed particulars. Form 26AS, will have details of TDS deducted by the employer, and if the details don’t show up then it means the employer deducted TDS but didn’t deposit with the government and so an employee may have to pay tax to the government himself and later on claim from his employer.

Pay additional tax

If the amount of tax paid by the employee is less than what is mentioned in form 26 AS then the employee must pay the relevant amount of additional tax to the appropriate authority.

Evidence Of Proof Of Investments By Employee[6]

The Finance Act, 2015 had introduced section 192(2D) of the Income-tax Act, 1961 (the Act) wherein the person responsible for making payment of salary (employer) was obliged to collect the necessary evidence or proof in the prescribed form and manner to allow any claim for any deduction and/or tax saving investments.

The Central Board of Direct Taxes (CBDT) has come out with the relevant rules and also prescribed the form i.e. Form 12BB, in which salaried employees would now be required to furnish evidence of claims and tax saving investments to the employer. These rules come into effect from 1 June, 2016.

Employers should ensure that they obtain the declaration from employees in the prescribed Form 12BB in order to be compliant. Form 12B is required to be furnished as per Rule 26A by a new employee joining any organisation in the middle of the year detailing income earned from the previous employer.^[7]

References

[1] http://www.deccanherald.com/content/553241/how-use-your-form-16.html

[2] http://www.business-standard.com/article/pf/changing-jobs-declare-past-income-to-new-employer-113070600609_1.html

[3] http://www.livemint.com/Money/5v0jwSCNNPZMF7pBo4oAqM/An-employer-can-be-penalized-for-not-issuing-Form-16-by-due.html

[4] https://blog.cleartax.in/when-employer-fails-to-issue-form-16/

[5] http://taxguru.in/income-tax/tds-on-salary-employees-responsibility-if-employer-defaults.html#sthash.Q7Pp6gKn.dpuf

[6] Tax Insights from India Tax & Regulatory Services, “CBDT notifies new form for reporting employee claims and tax saving investments, amends withholding tax rules and forms”, May 04, 2016

https://www.pwc.in/assets/pdfs/news-alert-tax/2016/pwc-news-alert-4-may-2016-cbdt-notifies-new-form-for-reporting-employee-claims-and-tax-saving-investments.pdf

[7] http://www.charteredclub.com/form-12b/

This was all on Employer’s Responsibilities For Tax Filing Of Employees. Do you have any questions on Employer’s Responsibilities For Tax-Filing Of Employees? Please comment below and let us know.

In this article, Shikhar Shrivastava discusses Structuring advice to an Indian entrepreneur who is looking for business expansion in China.

An Indian Entrepreneur who has a well settled business in India and looking for a possible expansion in China may find this research paper to be of valuable assistance in making a well formed business expansion decision.

India is a Democratic Federal State with market based economy whereas China is a Communist State with a liberal economy relying largely on investment and export led growth. India is currently the fastest growing major economy of the world[1] and China is the second largest economy along with being the largest exporter and second largest importer of goods in the world[2]. Being the two biggest economy of Asia, it is a very good time for business expansion in these two countries for an entrepreneur.

In order to give a structuring advice to set up business in China following points should be considered:

Choosing Industrial Sector

In China there are three types of industrial sectors: firstly, those in which the government encourages foreign investment (usually by means of fiscal incentives), secondly, sectors restricted to foreigners (or in which a foreign partner can only operate by means of a Joint-Venture with a Chinese counterpart, and thirdly, sectors that are completely prohibited, and therefore inaccessible for foreigners.[3]

In general, the sectors that promote innovations in areas such as environmental protection, export or the development of the poorest regions of the country are encouraged. A restricted sector would be one of the industries that have a negative impact of the environment. Forbidden sectors include those considered politically sensitive, or that can be damaging to the country. If one’s industrial sector is not mentioned in the catalogue then it simply means that it is permitted.

Business Structures in China

Foreign investors can take up business structures like Representative offices (ROs), Wholly Foreign Owned Enterprises (WFOEs), Foreign Invested Partnership Enterprise (FIPE),  Joint- Ventures (JVs), Hong Kong Company,  Shanghai Free-Trade Zone Company (FTZ).

Representative Office is a structure whereby a foreign entity establishes its presence in another country for a very limited purpose and does not undertake any direct business activity. ^[4] It is established to get familiar with the new market, local conditions, and perform some preparatory activities like promotion/advertising of foreign company, gathering local information etc., so as to act as a medium between the local customers and the Head Office.

This structuring is faster, cheaper and easier than forming a Wholly Foreign Owned Entity (WFOE), but this is generally discouraged because “switching” from a RO to a WFOE involves both shutting down the RO and forming a WFOE which is considerably costlier than just forming a WFOE[5].

Basic requirements for forming a RO:[6]

• There must be a registered lease for a period of at least one year beyond the approval date of the RO.
• There must be a designated Chief Representative who will manage the affairs of the RO.
• There must a foreign entity (typically a limited liability company or a corporation) that the local office represents; private individuals and partnerships cannot establish a RO in China.

There are two major issues in working as a RO; firstly, it is not permitted to earn income in China, nevertheless, they are subject to a 10% tax on the gross expenses and secondly, it can hire Chinese nationals only through Chinese employment agency but it can directly hire foreign nationals[7].

Foreign Invested Enterprise (FIE) is a company that has 25% or more foreign control and if the entity is completely owned by foreigners then it is called a  Wholly Foreign Owned Entity (WFOE). Usually, WFOEs are Limited Liability Company (LLC), where the liability of shareholders is limited to the capital invested in the company. Depending on the nature of the activity (manufacturing, consulting, services, etc) and the geographical location of registration of company, a different registered capital is required.[8]

Foreign Invested Partnership Enterprise (FIPE) for foreign investor refers to:

1. 2 or more Foreign enterprises or individuals establish a Partnership Enterprise (PE) in China; and
2. Foreign enterprise(s) or individual(s) with Chinese individual or company establish a Partnership Enterprise (PE) in China.

There is no minimum registered capital required for FIPE and like WFOE, FIPE could also generate revenue, hire local and foreign staffs and enter into contracts with local and overseas businesses in China.^[9]

Joint-Venture (JV), or a company controlled by both foreign and Chinese partners is another common form of FIE. Usually it is a transfer of technology and foreign companies who intend to operate in a “restricted” industrial sector, a Joint-Venture is their only option.^[10]

These investments are often structured as bilateral government to government investments in any event, with the partner companies merely executing the Government’s wishes. Many of these JV projects are very long term and may also carry government backed guarantees of investment.^[11]

Hong Kong Company  is used as a Special Purpose vehicle (SPV) to invest in Mainland China. Although a HK company is not a legal entity in mainland China but many foreign investors choose to form a Hong Kong company as a SPV to invest in China because of the favourable tax treatment offered under the Hong Kong- China Comprehensive Double Tax Arrangement. More than 90% of Chinese-inbound investment adopts a Hong Kong company as an SPV. Hong Kong imposes no tax on capital gain and does not impose withholding tax on dividends and interest payable by a HKC to overseas.

In order to avail this HKC as SPV, the company must obtain a Hong Kong tax residency certificate. For a company that is incorporated in Hong Kong, a Certified Extract of Information on the Business Register or a copy of the certificate of incorporation is sufficient evidence.^[12]

Shanghai Free-Trade Zone Company (FTZ) is a free-trade zone  integrates four existing bonded zones in the district of Pudong — Waigaoqiao Free Trade Zone, Waigaoqiao Free Trade Logistics Park, Yangshan Free Trade Port Area and Pudong Airport Comprehensive Free Trade Zone. Customs formalities within the free-trade zone will be simple and convenient and the entry of goods will only require registration of the variety and value of the goods without any inspection and intervention.[13]

This free trade zone will provide world-class transport and communications facilities, as well as a tax-free environment for domestic and foreign enterprises, promote China’s interest-rate liberalization. The creation of a Shanghai free trade zone is the Chinese Government’s initiative is to further free trade with outside world.

Starting a Company

In order to start a company in China following is a list of documents which are required to be submitted namely, name of the company, list of Partners and  managerial structure, legal address of the company, rental contract, Articles of Association (AOA), number, citizenship, salary and benefits for employees, registered capital and the total investment, a business plan, any other document requested. If all documents in the application are not present then chances are that the proposal can be denied, and after the first denial, getting the necessary permits becomes even more difficult.

Thereafter, Approval Certificate and then Business License, can be received from the Ministry of Commerce (MOFCOM) and the State Administration of Industry and Commerce (SAIC) or with their local branches. Depending on the city, the forms and/or documents to submit may vary. After getting business license, a bank account deposited with registered capital has to be opened in order for the company to become active.

Other Factors

Geographic Location

The geographic location or the city or province in which to have your legal address depends upon factors namely, availability, quality and salary of local employees and workers; proximity to distributors, suppliers and customers, local rules, policy and government incentives such as tax reductions on profits or import/export duties [special zones such as the Special Economic Zones (SEZ), the Economic and Technological Development Zones (ETDZ), the High-tech Industrial Development Zones (HIDZ), the Free Trade Zones (FTZ) or the Export Processing Zones (EPZ) could be considered].

Corporate Taxes in China

Here’s a list of taxes to consider for a WFOE or Joint-Venture:

• Corporate Income Tax of 25% on profits;
• Turnover Tax (or Transaction Tax) of 3%-5% on sales;
• Custom Duties;
• VAT is uniform across the nation;
• Individual Income Tax imposed on dividends.

Language and Local Hiring

English language use in China is concentrated more in first-tier cities but Chinese companies have started to recruit English speaking employees to help in the transactions.

Employing expatriates in senior management positions offers greater operational control, but is also costlier in terms of salary packages, relocation costs, insurance and other expenses.  Moreover, most expatriate managers have a very limited local knowledge of Chinese cultural and business practices, and very seldom have the Chinese language skills necessary for dealing with Chinese companies on a day-to-day basis.

A local managerial or executive person is required who can make proper and efficient management decisions while maintaining relationships with business partners, suppliers and vendors and government officials, local customers in a business transaction as risk taking-decision-making attitude in a transaction is related to the culture of the host country.

Market Research

A decision to setup in tried and tested locations or to take the risk of setting up in a less developed market depends on a various factors, and ultimately this decision will be based on having thoroughly research of the demand and supply of the market.

It is very critical to understand the ground reality of consumers and their buying habits along with exploring all the other regulatory barriers before going for a full fledged market entry. It is equally important to constantly monitor for any changes in the legislation or regulations and their probable effects on the business.

Tier 1 cities of China are most mature markets and offers efficient and skilled employees, lowest entry level risk but it will also results in higher operational costs and more competition. A new entrant should try to exploit economic growth and rising incomes in China’s Tier 2 cities which also have the advantage of lower set-up and operating costs. It can lead to a great long term investment success.

Conclusion

Choosing the right vehicle for entry is one of the most crucial decisions a business can make before entering China. This depends upon on a number of factors, including industry sector, scope of the market, local resources availability, technical support etc., along with the overall setting up and operational cost. Whichever market entry mode is chosen, thorough market research should precede any final decision on how and when to enter the market.  A growing number of market research companies now have operations in China, and their services should be resorted to in order to get the clear ground reality of the market.

A company could look at utilizing synergy of the Indian expertise in services, accounting, management, IT, software, consultancy etc., and with low cost mass production expertise of China to cater.

A thorough and well executed market research study can help prevent poor decision-making and lead to a better strategy for the future

References

[1] http://www.business-standard.com/article/economy-policy/at-7-6-in-fy16-india-is-now-the-fastest-growing-economy-116053101080_1.html Last accessed on 27/02/2017

[2] http://www.thefactspeak.com/china-largest-exporter-importer-goods/ Last accessed on 27/02/2017

[3] Catalogue for the Guidance of Foreign Investment Industries (Amended in 2011) accessiblehere:http://english.mofcom.gov.cn/article/policyrelease/aaa/201203/20120308027837.shtml

[4]Liaison Office – A Tax Efficient Structure, Shariq Contractor can be accessed at http://www.cnkindia.com/liaison_office.pdf

[5] http://www.chinalawblog.com/2010/01/how_to_form_a_representative_o.html Last accessed on 27/02/2017

[6] Id.

[7] Id.

[8] http://www.saporedicina.com/english/how-to-start-a-company-in-china/#Last accessed on 27/02/2017

[9] http://www.pathtochina.com/types_of_business_china.htmlLast accessed on 27/02/2017

[10] Id.

[11]http://www.china-briefing.com/news/2008/03/18/the-jv-vs-wfoe-debate-%E2%80%93-choosing-between-the-options.html Last accessed on 27/02/2017

[12] http://www.amicorp.com/AmiNews/HKSPV/English.html Last accessed on 27/02/2017

[13] supra note, 10

This was all on Structuring advice to an Indian entrepreneur who is looking for business expansion in China. Any doubt on Structuring advice to an Indian entrepreneur who is looking for business expansion in China? Please comment below and let us know.

Namita Shah Partner, (CA, CPA(USA), LLB, Certified Mediator) from Edgecraft Technologies LLP discusses five basic rights the law guarantees every Indian consumer.

“Consumer can be king only if he protects his rights as though it is his kingdom!”

A fiercely competitive market comes with its own benefits – of having a choice and getting only the best, but also has its own share of negatives – of being taken for a ride way too often only for a few bucks!

To battle this, the Indian law lays down certain regulations and guidelines for protecting the consumer and guaranteeing justice.

5 important laws in this regard are:

Right to information

Every consumer has the right to be informed about the quality, quantity, potency, purity, standard and prices of goods and services. This right is meant to protect consumers against unfair trade practices. This means that, for example, in relation to medicines, the pharmaceuticals are required to disclose potential side effects of their drugs and manufacturers should publish reports from independent product testing laboratories in order to facilitate a comparative analysis with the competitive product.

Right to choose

Every consumer has the right to choose between a variety of goods and services. Every consumer has to be assured of an assortment of products at competitive prices. Due to the existence of this right, the formation of cartels to set up monopolies is not legal. This means that sellers of similar products or services cannot come together to form a single organization to nullify the bargaining power of the consumers. However, the reality is that such cartels do exist, and many of the closely controlled industries such as natural resources, liquor, telecommunications, etc. are controlled by a few people in power and it is believed that India has to stride for about 20 more years for empowering its citizens fully in this regard.

Right to safety

Every consumer has the right to be protected against marketing of goods and services which are hazardous to life and property. The main application of this right is in the healthcare, pharmaceuticals, and food processing sector as these have direct impact on health. It aims to protect consumers against immoral practices by doctors, hospitals, pharmacies and the automobile industry. However, the lack of world-class product testing infrastructure in the country does hamper this right to a great extent.

Right to be heard

Every consumer has a right to be heard and to be assured that his interests will receive due consideration at appropriate forums. This right helps to empower the consumers for putting forward their complaints and concerns fearlessly and raising their voice against products or even companies and ensure that their issues are taken into consideration as well as handled expeditiously.

Right to redressal

Each consumer has a right to seek redressal against unfair or restrictive trade practices or unscrupulous exploitation. There are consumer courts at district, state and national level for redressal of disputes. This right empowers the consumer to approach these forums and find resolutions to exploitations.

What to do if you are a victim of violation?

Laws and regulations are effective only when consumers truly understand them and more importantly, ensure their effective implementation.

If a consumer feels that he is a victim of violation of any consumer right then he can file a complaint in consumer court of India. ‘Consumer Court’ is the special purpose court that deals with cases regarding consumer disputes and grievances. These are judiciary set ups by the government to protect the rights of consumers. The main function of such courts is to maintain the fair practices by the sellers towards consumers.

There are 3 types of consumer courts in the country

• District Consumer Disputes Redressal Forum (DCDRF), established by the State Government in each district of the State, it deals with cases valuing up to Rs. 20 lakhs.
• State Consumer Disputes Redressal Commission (SCDRC), established by the State Government in the State. It is a state level court that takes up cases valuing less than Rs. 1 crore.
• National Consumer Disputes Redressal Commission (NCDRC), a national level court works for the whole country and deals with amount more than Rs. 1 crore.

A consumer does not need a lawyer to file a complaint or to fight his case in this forum. He can file the complaint himself. A consumer is not required to pay any court fee but just a nominal fee depending on the type of court and the claim amount.

The procedure to file a consumer complaint:

• Firstly, identify the jurisdiction of the forum where the complaint is to be filed. The consumer has to take into consideration both the territorial and pecuniary (as stated above) jurisdiction of the tribunal in mind before filing his complaint before choosing the correct forum.
• Draft your complaint stating facts necessary to establish a cause of action. The Consumer Protection Act, 1986, contains the format of the complaint. (Click here to download the format). You will be required to pay a prescribed fee along with your complaint before the respective forum.
• Attach copies of all the documents supporting your allegations. In this you can put on record the copy of the bill of the goods bought, warranty and guarantee documents and also a copy of the written complaint and notice made to the trader requesting him to rectify the product.
• You can also ask for compensation costs which should be specifically alleged in the complaint. Besides compensation, a consumer can also ask for the refunds, damages, litigation costs, and interest amount.
• You are also required to file an affidavit along with the complaint that facts stated in the complaint are true and correct.
• The complainant can present the complaint in person or by his/her authorized representative without engaging any advocate. The complaint can be sent by registered post. A minimum of 5 copies of the complaint is to be filed in the forum. Besides this you have to file additional copies for each opposite party.
• This can be done online as well, by filing the complaint on any of the following websites:
  • http://core.nic.in/
  • http://www.consumergrievance.com/
  • https://india.gov.in/lodge-complaint-online-national-consumer-helpline-portal
  • http://ccrc.in/submit_complaints.php

The true success of laws, and the entire judicial system, lies in the power of every citizen – to fulfill his responsibility and use his powers. The choice is yours.

This was all on Five basic rights the law guarantees every Indian consumer. Any doubt on Five basic rights the law guarantees every Indian consumer? Comment below and let us know.

In this article, Joaozinho da S. F. A. Martins discusses Infringement of democratic legislation through fraudulent amendments.

Perhaps, for the first time in the history of the Republic of India, consecutive past governments in Goa have succumbed to an ignominious low in governance. The then Congress Government in power clandestinely allowed fraudsters in the Town and Country Planning Department to publish fraudulent amendments to the existing established democratic legislation, namely “The Goa Regulation of Land Development and Building Construction Act, 2008” read with “The Goa Land Development and Building Construction Regulations, 2010”.

These subtle fraudulent amendments have been unjustifiably imposed upon the unwary Goans through illegal Notification No. 21/1/TCP/2011/Part File/3252 dated 4^th August, 2011, published with the purported sanction or assent of the then Governor of the State of Goa, representing the Hon’ble President of India.

Unquestionably, the process of democratic legislation has been desecrated to permit the greedy Builders to prevail in their nefarious plans to go ahead in their construction projects with the sanction of governmental authorities involved. The subsequent BJP Government next stealthily let these same fraudulent Amendments to deliberately continue to exist. It is now left to be seen whether the resurrected BJP Government in Goa backed by its ideologically differing coalition MLAs will take immediate steps to nab the culprits involved and thus take Goa Forward. As otherwise, the same monstrous fraudsters infesting the Town and Country Planning and P.W. Departments will continue to do legal damage to established democratic legislation and subtly allow greedy builders indulge in their blatant destruction of Goa, even as it was the case under the preceding corrupt regimes.

Unequivocally, it is exclusively to facilitate the Builders’ Lobby in securing Technical Clearances to erect concrete jungles in Goa, the following two illogical amendments to the said Land Development and Building Construction Act, 2008 read with Regulations of 2010 have been illegally published in August, 2011 as if the same were a standard Legislative Act of the Government:-

1. The original logical Regulation 5(f) which, when read with Sub-Division Regulation 12.6c, requiring a minimum10 meter-wide access road to any plot with an effective area above 20 000 m², has been cunningly deleted. And, the same has been substituted with a new Regulation which contradicts Regulation 12.6c. This substituted Regulation is meaningless and incoherent. As such, the earlier essential Regulation 5 (f) requiring 10 metre-wide Right of Way (access road) to any multi-dwelling construction site that has been done away with, needs to be reinstated.
2. Next, indiscreet change has been made in Regulation 6 A 4 through the Insertion of Note 16. This ridiculous fake Note 16 allows Technical Clearances to be given even with a mere 6 metres wide access to any site/plot irrespective of its effective area. And, this idiotic Note 16 permits Clearances to Group Housing Projects even when there are blockages on the access-road, such as trees, religious structures, bottle necks, etc. further reducing the 6 metre-width access; and so, permissions can now be freely given irrespective of the nuisance caused to the traffic due to a narrow road plagued with multi-faceted obstacles.

Accordingly, the erstwhile Congress Government let the fraudsters to draft and publish the said Notification No. 21/1/TCP/2011/Part File/3252 in the Official Gazette dated 04/08/2011. In doing so, it enforced upon innocent Goans arbitrary amendments made fraudulently. It can be reasonably concluded that random amendments in the said Act were made in collusion with the Builders who are the sole beneficiaries of the said illegal illogical amendments that failed to catch the attention of the Legal Fraternity in Goa.

Undoubtedly, the said fraudulent amendments have now been relied upon by the Builders’ Lobby to secure easily Technical Clearances and Construction Licenses for their Mega-Housing Projects. For example, Bombay-based Raheja Universal Pvt. Ltd, after having miserably failed in 2008-10 to get Technical Clearance now coolly managed to get the same for their Group Housing Project in the Village of Carmona. And, perhaps, the same sham Amendments may have been used or could be used by other greedy builders who are out to destroy our beautiful land through erection of concrete jungles in the State of Goa.

That the Legislators during the regimes of successive past Governments in Goa allowed such fraudulent amendments to be published is certainly abominable and downright shameful. And, the Memorandum to the Governor of Goa submitted some three months ago requesting to Order the Government of the day to revoke the fraudulent amendments has not borne any result. Nevertheless, the copy of the said Memo to the Governor of Goa that was sent to the President of India has been definitely taken note of. The President through his Secretariat has asked the Chief Secretary of the Government of Goa to take the necessary action.

Anyway, Public Interest Litigation has been filed before the Hon’ble High Court of Bombay at Panaji to quash the said illegal devious amendments. And, further, it is hoped against hope, that the resurrected BJP Government will order a CBI inquiry to nab the culprits in the Town and Country Planning and in other related Government Departments who are thus criminally involved. Only then, due justice could be said to have been rendered to all the concerned aggrieved Goans.

Moreover, it should be mandatory on the part of the current allied BJP Government, with the blessings of the Governor of Goa, to take appropriate immediate measures to prevent such shameful frauds. Only then, such immediate precautionary action will stop the fraudsters from further tampering with established legislation relating to Land Development in the tiny State of Goa.

This was all on Infringement of democratic legislation through fraudulent amendments. Have any questions on Infringement of democratic legislation through fraudulent amendments? Comment below and let us know.

In this article, Aavish Kant discusses Ten basic rights of an employee.

“One machine can do the work of fifty ordinary men. No machine can do the work of one extraordinary man.” Elbert Hubbard 

International Worker’s Day also commonly known as Labourer’s day is celebrated on May 1 of every year across nations to celebrate worker’s contribution towards national and economic development.

In India the first Labour Day was celebrated on 1st of May 1923 by the Labour Kisan Party of Hindustan at Chennai. Though it is not a gazetted holiday in India, many workplaces around the country are shut on this day to mark and respect the contributions made by their employees.

This International Workers Day know what are your rights as an employee. Myriad obligations have been imposed on employer by the government to empower the workforce.

Here are the 10 most important rights of an employee

Ten basic rights of an employee

Right to get Paid Leaves

Every employee has the right to be granted a Paid Leave by his employer, the provisions of paid leaves as given under the factories act are as follows

Right to Equal Pay for Equal Work 

Equal pay for Equal work is a constitutional right and any employer is liable to pay equally to any men, women or temporary staff performing same tasks and undertaking same responsibilities. There can be no discrimination while paying any basis to employees.

Right to go on strikes

The employees are provided with the Right to go on a strike without giving a notice, however if the said employee is a public utility employee, then he would be bound by the prohibitions laid down in the Industrial Disputes Act 1947, Section 22(1) lays down certain conditions on Strikes by public utility employees, the conditions includes giving out prior notice to the employer six weeks before going on such strike.

Gratuity benefits

Gratuity is a lump sum amount paid to employees and it is a statutory benefit given to employees who have rendered continuous service for at least five years. This is to provide social security to employees and an employer cannot forfeit the amount of gratuity.

Provident Fund

Every employer is liable to maintain an Employee’s Provident Fund (EPF). It s a retirement benefit scheme that’s available to all salaried employees. The law mandates that both the employer and the employee has to contribute 12% of their basic salary.  

Right to get Insurance

Every employee will have the right to be insured by the employer under the Employee State Insurance Act 1948, in case of any kind of injury or miscarriage occurring during the course of employment.

Maternity benefit

Every female employee has the right to get 26 weeks of paid maternity. Maternity Benefit Act has been enacted to safeguard the interest of the pregnant women at workplace. Employees are also entitled to one additional month of paid leave in case of complications arising due to pregnancy, delivery, premature birth, miscarriage, medical termination or a tubectomy operation.    

Right Against Sexual Harassment at Workplace

The law mandates employers to protect their female employees at workplace against any incidence of sexual harassment as per the Sexual Harassment of Women at Workplace (Prevention) Act, 2013. All offices, hospitals, institutions and other establishments should set up an internal complaint committee to address all the complaints made by women reporting sexual harassment at workplace.  

Working Hours

The Shop and Establishments Act of every state has fixed the maximum no. of working hours 9 hours a day and 48 hours a week. The Shops and Establishment act does not see any difference between managerial and nonmanagerial workers when it comes to regulations relating to working hours. The working hours may be increased up to 54 hours a week upon prior notice to the Inspector, but this increase would be subject to a condition that overtime hours should not be more than 150 in one year.

Written employment agreement

Typically in a private organization, most of the the labour laws are not applicable on employees. They are majorly governed by the terms and conditions of the employment agreement. In such an event, if there is no written employment agreement it may lead to unnecessary disagreements between the employer and the employee.  Therefore, an employment agreement gives both the parties a sense of clarity over their roles, responsibilities, and obligations. Your employer must give you a written agreement before you commence your work. In case, your employer denies, you can rightfully ask for it.

A well dressed man, in a cabin full of books and files, who with his articulation and advocacy skills can bend the things in direction favourable to his client. Yes, this is the stereotype of a lawyer.

But the legal profession has much more to it than files, argumentation and money. Emails, documents, contacts, billing, etc. have to be managed simultaneously to earn a reputation in the profession. The daily management of all this, along with balancing the hustle-bustle of courts and corporate firms is very daunting and complex.

Technology and Management have many answers to all these problems. Legal practice management enables one to systematically organize all your work, improve the quality of services and save time. In developed countries, a lot has been done to equip lawyers with the management principles, processes, and technology to efficiently manage and grow a legal practice. In most of these jurisdictions, the bar associations or legal regulators make a special effort towards making lawyers go through management curriculum as it is not only good for lawyers but beneficial for the clients as well.

Do we need a legal practice management curriculum in India as well?

Let us take a look at what is happening in other major jurisdictions first.

Practice Management in USA

In developed countries like USA, the idea of legal practice management came up when our country had experienced just one year of independence. In August 1957, Charles S. Rhyne, President of the American Bar Association (ABA), made one of his major objectives, the institution of a “comprehensive program to aid members of the ABA in the field of economics of law practice.” He aimed to increase the coordination of assistance to lawyers in the business phase of the practice of law, achieved by ABA through its staff, committees and sections and by the state and local bar associations.

In 2015, more than one million people were employed in legal occupations in the U.S. This number was set to rise to 1.38 million in 2022. The largest share of those working in legal occupations was comprised of lawyers. More than 40 percent of 2015 law graduates had taken up employment with law firms by March 2016 and 62.4 percent were working in occupations which required the passage of the bar exam.

Financial Times reported that around 114,000 jobs in the legal sector are likely to become automated in the next 20 years as technology transforms the profession, a new study has found. Future law firms will be looking for non-traditional employees such as project managers, data and technology experts as well as fee earning lawyers, the study predicted.

With need for effective delivery of services to client’s growing demands and the statistics continuously indicating expansion and development, both the law firms and legal professionals have frequently resorted to Legal Practice Management courses and softwares. According to the 2015 ABA Legal Technology Survey Report, practice management availability at law firms was close to 45% and 49% in 2015 and 2014 respectively.  

Here is a paper by a co-chair of the eLawyering Task Force set up the American Bar Association’s Legal Practice Management Section that argues that law schools in the USA need to change their curriculum and include more subjects related to law practice management.

Law Practice Management in the UK

Law Practice Management in UK is highly developed. The Law Society of England and Wales supports its members and legal practice managers to develop their organisational capacity to deliver high-quality services to their clients and encourage a diverse workforce. The Legal Practice Management Association (LPMA) was founded way back in 1996 for providing a supportive networking forum for those involved in, or seeking involvement in, legal practice management. It is recognised as a valuable group by organisations such as the Bar Council, Bar Standards Board, Legal Services Board and other regulatory bodies.

The Law Society has recognized a quality management system named ‘Lexcel’ which focuses on seven different areas: structure and strategy, financial management, information management, people management, risk management, client care, file and case management. This scheme certifies, for any type of practice, that certain standards have been met following independent assessment.

Law Practice Management in Singapore

Legal Profession (Legal Practice Management Course) Rules, 2015 deal with the content, assessment, registration and completion of the legal practice management course in Singapore. Completion of this course, conducted by the Law Society of Singapore is recognized as a qualification to practise in Singapore Law Practice. Delivered using a mixture of lectures, case studies and panel discussions, this Course is taught by subject matter experts in law practice management. Here are the details of the 19th edition of this course.

The Law Society of Singapore has worked with various private sector entities and has introduced practice management certification scheme, after studying systems adopted by law associations in England and Australia. The Business Times reported that the Singapore Ministry of Law  has launched “Tech Start for Law” to help firms with up to 70 per cent of the cost of adopting basic technology products, including practice management and online legal research. Universities in Singapore also organise programmes (such as this) focusing on entrepreneurial and management aspect of legal practice.  

Law Practice Management in Canada

Bar associations in Canada have attempted to equip their members with legal practice management. For instance, here is the Law Practice Management Section of the Ontario Bar Association. We also came across Dalhousie University offering an executive education course in Law Practice Management through Schulich Law School. There are also a number of blogs dedicated to law practice management in Canada.

Law Practice Management in Hong Kong

The Law Society of Hong Kong’s official journal has a dedicated section to law practice management. There are lawyers and consultants regularly researching and writing on better practice management methods and business models for law firms. You can see some of the work regarding law practice management at this link.

However, in this jurisdiction practice management as a discipline seems to be mainly driven by private players rather than regulators or lawyers associations.

Law Practice Management in Australia

Australasian Legal Practice Management Association, a private initiative to educate lawyers, law firm executives and managers and other stakeholders, claims to have widespread membership in the Australian lawyer community and organizes regular events regarding various aspects from practice management, from cyber security and data protection to learning and development operations inside law firms. Leading job portals like Seek.com and Adzuna lists many specialized legal practice management jobs. Check out this link for an idea. Various bar associations also have taken steps to legitimize and spread legal practice management education in Australia. For example, the Law Society of New South Wales offers a legal practice management course through FMRC Legal and the College of Law. Doing such a course can be a precondition to practicing in Sydney.

Practice Management in India

After reviewing the global scenario, especially most of the common law jurisdiction having strong presence of legal practice management, it may seem strange that so little has been done in India towards introducing systematic legal practice management.

Legal professional sector in India is largely disorganised. Leave the intricate aspects to law such as management and business, the Bar Council of India has barely taken any steps to regulate some very basic aspects of the profession such as admissions, registration, etc. Lawyers are on their own when it comes to managing the services and business development aspect of their business.

With brisk economic development in the country, the corporate law sector is booming and there are 100s of law firms and practising advocates in the country. This fledgling industry has to deal with various tasks such as management of documents, tracking calendar, maintaining client-contact database, fees etc. Many law firms in India use some or the other form of management techniques to efficiently carry out these tasks.

But be it a fresh law graduate/ law firm or a well established lawyer/ law firm, all face problems when it come to handling numerous fringe tasks associated with the profession, while effectively delivering services to the client. There is either complete absence of legal practice management or multiple management processes to handle multiple tasks, which further multiplies the workload.

How we started the Nani Palkhivala Law Practice Management Course

At the source of the initiative is a discussion I had with another legal entrepreneur, Hrishikesh Datar of Vakilsearch.com.

Both of us came across the challenges faced by Indian lawyers beginning their practice in their own ways. iPleaders has worked for over 5 years in training lawyers and law students, while VakilSearch is India’s leading legal services marketplace, and is maker of the Libra software that is being used by a large number of Indian lawyers for practice management.

In absence of formal initiatives by Bar Associations, we decided to initiate a private effort to introduce legal practice management curriculum in India. The discussions started towards the end of 2016, and now iPleaders has launched the first Legal Practice Management Course in India with support from VakilSearch and a handful of successful lawyers who support the idea and provided intellectual and academic inputs for the course.

The Nani Palkhivala Law Practice Management Course, is an one-stop solution to the daily administrative problems and growth challenges faced by lawyers in India. It brought together not only the knowledge but the tools and the services that would make a real difference to your practice.

Advantages of NP-LPM Course

• Generating Leads – Increase the number and quality of incoming queries for services.

• Efficient Practice – Putting administrative aspects of your law practice on autopilot.
• Going online – Building a website as per rules, expanding web-presence etc.

• Building connections –  Building connections, professional networking and increasing social media presence.
• Expansion of practice – Best practices to hire and retain clients and employees and much more.

Course Content

1. Lessons and tutorials prepared exclusively for young lawyers and small firms, hungry for more.
2. Your personal website, in compliance with BCI Rules [hosted on your chosen domain name].
3. Complete automation of your practice with a subscription to the LIBRA Practice Management Tool.
4. “Case Studies” – Stories of the best lawyers and what they did, rolled out on a periodic basis.
5. “Lessons in Excellence” where we offer you the habits of the best practitioners, and give you a roadmap to follow
6. “Public Meetings” where we schedule lectures with the best legal minds where they share their thoughts and guidance to course participants
7. Libraries of Legends – A look at the libraries of 10 great lawyers
8. Readers are Leaders – A list of books which rising stars and legends read and recommend
9. “Day in the life of” – What does a day look like, in the life of the biggest names in the Supreme Court? Get some stunning insights into how they manage their day and their life.

Pursuing the course will require you to spend 3 hours per week working on management and expansion of your practice.

If you want to learn more, please reach out to us on  011-3313-8901 or visit the course page.

If any university would like to work on advancing legal practice management in India, we heartily invite them to reach out to us on the above number as well.