With the ever-growing economic and business environment at a global level, the relevance of Double Taxation Avoidance Agreements (DTAA) is becoming more relevant than ever before. The advent of remote work culture brought about by the pandemic has only increased the importance of ordaining DTAAs between countries. DTAAs have facilitated the ease of having multi national incomes without having to worry about the taxes applicable in multiple countries.
When a resident of one country earns income from another country, he may be taxed in both countries on the grounds that he is the resident of the first country while the source of the income is in the second country. This gives rise to the need for a DTAA. Without a DTAA, the taxpayer would bear the brunt of paying taxes in both countries. This is because both countries would claim their right to tax the income earned by the taxpayer, on the basis of residency in one country and on the basis of income source in the other country. At this point, if there is an effective DTAA between both these countries, the dilemma of double taxation on the same income may be avoided.
Decoding a Double Taxation Avoidance Agreement (DTAA)
Double Taxation Avoidance Agreement is a mutually consented upon agreement between two countries on the taxability of specified incomes which both countries claim to have the right to levy tax on. Most countries have DTAAs with each other to overcome the issue of double taxation arising due to cross border incomes. With the help of these tax treaties, countries also aim to promote international trade and amplify economic relations.
DTAA was first conceptualised in the early nineties by economists for making a division of tax rights between countries. After that, tax conventions for avoidance of double taxation were published by the United Nations (UN) and the Organisation of Economic Co-operation and Development (OECD). Eventually, most countries broadly followed the UN model tax convention and the OECD model tax convention while some South American countries followed the Andean Community Income and Capital Tax Convention. The OECD model derives the tax division based on the fundamentals of tax residency. However, the UN model is driven by the idea of tax residency as well as the source of the incomes.
Objectives of a Double Taxation Avoidance Agreement (DTAA)
The following are the objectives of entering into DTAAs:
Avoidance of double taxation on international incomes
The main purpose of DTAAs is to ensure that the same income is not taxed more than once by different territories. The articles laid down in the DTAAs establish the territory that will have the right to levy tax on a particular income.
To grant relief to taxpayers in one country for the tax paid by them in another country
With cross border incomes there are situations when taxes are paid by a taxpayer in one country but he may be subject to tax in another country as well. In such situations, DTAAs provide a mechanism for availing the credit of tax paid in one country against taxes to be paid in another country. Alternatively, it may provide an exemption to tax on the overlapping income already taxed in another country.
For exchanging information for preventing tax evasion or tax avoidance
As the DTAAs provide the methods for resolving taxes on overlapping income between countries, it facilitates both countries the requisite information exchange to ensure prevention of tax evasion and tax avoidance.
For recovery of income tax due as per the provisions of tax of respective countries
With the exchange of information through the implementation of DTAAs, the countries are in a position to also recover the taxes as per the respective tax provisions of the countries in a well structured manner and well within the regulatory framework.
Promoting economic and trade relations between countries
DTAAs bring in transparency in the tax systems which promotes a better business environment and helps in expanding trade relations between countries.
Types of Double Taxation Avoidance Agreements (DTAA)
DTAAs may be classified based on two criteria: one based on the incomes that it covers and the other based on the countries involved.
Based on the Incomes Covered
DTAAs may either be comprehensive or limited. Comprehensive DTAAs cover all major income streams. Usually, comprehensive agreements include incomes from immovable properties, business profits, dividends, royalties, fees for technical services, interest, capital gains, services, etc. However, limited DTAAs cover specific incomes like shipping, aircraft, inheritance, etc.
Based on the Countries involved
DTAAs may either be bilateral or multilateral. Bilateral agreements are entered into only between two countries, while multilateral agreements are entered into by more than two countries.
Progressive stages in a Double Taxation Avoidance Agreement (DTAA)
Before the DTAAs are enforced, they follow a structured path for their formulation and implementation. Broadly, the stages of a DTTA progress in the following manner-
Negotiation
The countries intending to agree upon dealing with overlapping incomes negotiate on the terms to deal with double taxation. The countries deliberate on the matter and come to a consensus on the terms and methods of resolutions that would form part of the agreement.
Formulation of Articles
The various clauses of the terms and conditions of a DTAA are designed to align with the agreed upon negotiations. The articles are formally structured terms of a DTAA. They are standardised clauses that form the skeleton of the DTAA.
Execution of the DTAA
On approval of the formulated articles of the DTAA, it is executed by both countries by signing the DTAA as an acceptance of the DTAA by respective countries.
Domestic Affirmation
The DTAA is subsequently approved and inserted within the domestic laws of the respective countries. Both countries then inform each other of their ratification of the DTAA in their respective domestic laws.
Enforcement
As per the ratification in the domestic laws, the DTAA becomes effective on the date mentioned in the DTAA.
Commonalities of different Double Taxation Avoidance Agreements (DTAA)
Due to the international nature and use of DTAAs, it is pertinent to have standardisation and uniformity in the design and implementation of DTAAs. Further, a DTAA, if interpreted differently, would nullify the very purpose of its enforcement. Hence, all DTAAs, by and large, are drafted and applied in a standard format based on the model convention opted for in the DTAA. Accordingly, DTAAs are structured to follow standard terminology, with each term well defined and uniformly interpreted unless specified. The DTAAs predominantly cover the following areas:
Scope of the DTAA: It includes the general scope, the taxes covered by the DTAA, the date of effectiveness and termination (if any).
Definitions: It provides a list of terms used in the DTAA along with their definitions for clarity. More importantly, it defines the term “Resident” and “Permanent Establishment” among others that are crucial in the interpretation of the DTAA.
Substantive Provisions: It covers the various income streams that will be guided by the DTAA.
Double taxation elimination: It contains the clauses pertaining to the methods to be adopted for eliminating double taxation.
Anti Avoidance Terms: It includes the clauses that ensure that there is no leeway for avoiding taxes.
Miscellaneous provisions: It includes ancillary terms not covered in any other clause of the DTAA.
Protocol and Memorandum of Understanding(MoU): Protocols and MoUs state the amendments in the DTAAs and explanations to the DTAA.
Structure of a Double Taxation Avoidance Agreement (DTAA)
Based on the broad classifications listed in the previous paragraph, the following are the detailed list of Articles encompassing a DTAA-
Article
Area of Coverage
Article
Area of Coverage
1
Persons covered
17
Entertainers and sportspersons
2
Taxes covered
18
Pensions
3
General definitions
19
Government service
4
Resident
20
Students
5
Permanent establishment
21
Other income
6
Income from immovable property
22
Capital
7
Business profits
23
Methods for Elimination of Double Taxation
8
International shipping and air transport
24
Non-discrimination
9
Associated enterprises
25
Mutual agreement procedure
10
Dividends
26
Exchange of information
11
Interest
27
Assistance in the collection of taxes
12
Royalties
28
Members of diplomatic missions and consular posts
13
Capital gains
29
Entitlement to benefits
14
Independent Personal Services
30
Territorial extension
15
Dependent Personal Services
31
Entry into force
16
Directors’ fees
32
Termination
All DTAAs all over the world are designed based on the above structure of articles. Comprehensive agreements cover most of the above articles as listed above. Different countries may include or exclude some articles based on areas of agreement between countries. As can be seen above, DTAAs by and large cover most of the income streams that might be subject to double taxation. Each of the incomes are dealt lucidly.
Double Taxation Avoidance Agreements (DTAA) in India
DTAAs in India are governed by Section 90 of the Income Tax Act, 1961 and Section 90A of the Income Tax Act, 1961 along with the related Rules. India predominantly follows the UN Model of Tax Convention for DTAA. India has different types of agreements with countries, including comprehensive, limited, multilateral, and tax information exchange. India has executed DTAAs with all major countries extending to over eighty countries.
How to avail the benefits of DTAA in India
For the purpose of availing the benefit of DTAA, a taxpayer may follow the following guiding principles-
Whether there is a DTAA between India and the other country for checking the taxability of cross border income.
If yes, the taxpayer is required to check whether he is eligible to choose DTAA provisions. His eligibility is determined by his residential status, permanent establishment and source of income of the taxpayer.
Next, if the taxpayer is eligible for choosing the provisions of the DTAA, he shall check if the said DTAA covers the nature of income in question.
Based on the relevant provisions of the DTAA applicable for the said income, the taxpayer may derive the tax implication applicable on the said income.
Simultaneously, the taxpayer may compute the tax payable by him as per the regular provisions of the Income Tax Act, 1961.
As per the provisions of the Income Tax Act, 1961, the taxpayer has the option to choose the provisions of the DTAA if they are more beneficial to him. Accordingly, a comparison of taxes payable under Points 4 and 5 above shall be the deciding factor for a taxpayer on whether to opt for the provisions of DTAA.
Income Tax Rules governing implementation of DTAAs in India
Rule 128 of Income Tax Rules 1962: This Rule specifies how a resident of another country may claim credit for tax paid on income earned in that country in accordance with a DTAA in India. Some of the important considerations are as follows:
The credit of foreign tax shall be available only to the extent of the income tax, surcharge and cess payable under Income Tax Act ,1961. No credit shall be availed for payment of any interest, fee or penalty under the Act.
No credit of foreign tax shall be available if the foreign tax paid is disputed by the said resident unless sufficient evidence is submitted by the resident within six months of the end of the dispute. The said evidence to be submitted should be to the effect that the tax liability is paid by him including an undertaking that no refund is claimed by him in this respect.
The amount of foreign tax credit shall be restricted to the amount of tax payable under Income Tax Act, 1961 and the foreign tax paid on the same income, whichever is lower. If foreign tax paid is in excess of Indian income tax, the difference is to be ignored and is not eligible to be claimed. The rate of conversion to be taken is the telegraphic transfer buying rate on the last day of the month immediately before the month in which such foreign tax was paid or withheld.
In case foreign tax credit is to be availed against tax payable under Section 115JB of the Income Tax Act, 1961 or Section 115JC of the same Act, the foreign tax credit is allowable only to the extent of the tax payable under normal provisions of the Act. Tax as per normal provisions of the Act is the tax payable as per the provisions of the Act other than Section 115JB of the Income Tax Act, 1961 or Section 115JC of the same Act.
Following documents are required for availing the benefit of a DTAA
Form 67 is required to be filed electronically by the resident providing details like the country of foreign income, amount of income earned outside India, foreign tax paid on the said income, tax payable as per the Act, the foreign exchange conversion rate, the amount of foreign tax credit availed, refunds of foreign tax claimed, etc. The form is to be filed on or before the last day of filing IT returns for the year in which the income is offered to tax in India.
Certificate or statement, specifying the nature of income and the tax paid or withheld, is to be obtained from the foreign tax authority or the person responsible for withholding of the tax. If such a certificate or statement is not available, then a statement is to be provided by the resident along with the evidence of tax paid or withheld. These documents are required to be uploaded along with Form 67.
Form 67 is also used in a case of carry backward losses which may result in the refund of taxes paid by availing foreign tax credit in the earlier year.
Rule 21AB of the Income Tax Act, 1961: A non-resident is not eligible to claim relief under a DTAA unless he provides the requisite documents and information as referred in Rule 21AB.
The non resident is required to provide the following-
Status of the non resident (whether he is an individual, firm, company or any other entity)
Nationality of the non resident
Tax Identification Number (TIN) of the non resident
Period of residential status in the foreign country
Address of the non resident in the foreign country
Tax Residence Certificate (TRC) issued by the foreign country
The non-resident is required to keep adequate documents that substantiate the information provided above.
Further, for availing the benefits of DTAA outside India, Indian residents may also apply for a Tax Residency Certificate (TRC) in the relevant Form 10FA to the concerned officer. The officer, upon receiving the application in Form 10FA, may upon being satisfied, issue the TRC in Form 10FB.
Conclusion
DTAAs have come a long way in promoting globalisation and transparency in taxation. They have further assisted nations in preventing tax evasion and resolving geographical tax rights between countries. DTAAs provide a seamless passage of income and taxes across the world, thereby providing a limitless expanse for promoting trade and boosting economies around the world.
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This article is written by Pujari Dharani, a B.A.LL.B. student at Pendekanti Law College, affiliated with Osmania University, Hyderabad. The article elaborately explains Section 464 and the crimes under it with various illustrations and case laws. The author also analysed its definition, elements, nature of the offence, and punishment for its commission in detail.
It has been published by Rachit Garg.
Table of Contents
Introduction
There are situations where a person intends to deceive someone by showing a document that is fake in reality but ensures that the document is as genuine as possible to benefit from it wrongfully. These activities will cause losses for one person and profits for the others.
These scenarios are not something very new; rather, they have been occurring since ancient times. Kautilya, in his book named ‘Arthashastra’ enumerated punishments and methods to deal with such cases. However, at present, these crimes have become more prevalent and, indeed, much easier than earlier, due to technological development all around the world.
The importance attached to a document is increasing with the feasibility of making such false documents. We know how a piece of paper or a document has become so important in our modern society. Documents like a caste certificate will benefit a person in various ways because of social welfare schemes. Similarly, a sale deed determines the actual owner of an immovable property. Every enterprise, whether micro or large-scale, runs on written or electronic documents such as contracts, cheques, bonds, etc. Due to the aforementioned reasons, the significance of documents is increasing gradually, thus, fabricating such an important document will result in huge losses, which may, sometimes, be in the crores when it comes to calculating their monetary value.
Despite amendments to laws and increases in penalties and punishments, criminals continue defrauding or deceiving someone to obtain wrongful gains by making false documents or electronic records that are detrimental to the interests of the general public.
Therefore, to prevent such incidents in Indian society, Section 464 was included in the Indian Penal Code, 1860. This provision exclusively and elaborately describes the offence of ‘making a false document’, which is an essential component in the commission of the offence called forgery. This article aims to shed light on the nuances surrounding this Section.
Relevant definitions
To know what crime Section 464 of the IPC defines and its punishment, it is essential to know some legal concepts and definitions of a few terms, before moving forward to Section 464.
Document
The word ‘document’ is defined clearly under Section 29 of the IPC. Section 29 of the IPC sets forth a clear definition of the term ‘document’. Given that Section 464 of the IPC pertains to the creation of ‘false documents’, it is imperative to refer to the definition of ‘document’. According to Section 29, a ‘document’ encompasses any substance that contains information, with the requirement that the person creating or executing it intends to use it as evidence either presently or in the future. The information contained in the document must be expressed or explained through letters, figures, marks, or a combination thereof.
It is noteworthy that certain circumstances do not preclude a substance from being deemed a ‘document’. For instance, the information may be written or engraved solely through the use of figures or on a material other than paper, such as wood or a tree. Thus, the aforementioned factors are irrelevant in ascertaining whether a substance qualifies as a ‘document’. Furthermore, it should be emphasised that a document need not necessarily be in paper form but may also be on any material on which information can be engraved or imprinted.
An agreement was drafted on paper with the intention that five persons would be parties to the agreement. But, later, it was signed only by two persons, not all persons. Still, it was regarded as a ‘document’ by the court in the case of G.S. Ramaswami Ayyar v. The King-Emperor (1917).
In the case of Emperor v. Krishtappa Khandappa (1925), the Bombay High Court held that trees could also be a ‘document’, if letters, figures or marks are imprinted on them and have the intention to use such documents as evidence.
Even currency notes fall under the definition of ‘document’.
Electronic record
The meaning of this word was dealt with under Section 29A of the IPC which was inserted by the Information Technology Act, 2000. There was a need to include this Section because of the increase in the use of electronic records in crime commissions due to the rampant advancements in the areas of technology, especially electronics and communications. Moreover, the increase in cybercrimes is yet another reason for the insertion of this word. Therefore, Section 91 of the IT Act, 2000, read with the Second Schedule, amended a few provisions in the IPC that are related to the offence of ‘forgery’ to include the word ‘electronic record’ beside the word ‘document’.
Besides this, it is imperative for us to know what the word ‘electronic record’ conveys because of its inclusion in Section 464 of the IPC. Section 29A of the IPC did not define this word, however, it directs us to refer to Section 2(1) of the IT Act, 2000, for the definition of the term ‘electronic record’.
The provision of Section 2(1)(t) of the IT Act, 2000, which defines the word ‘electronic record’ states that an electronic record is not just a record but can also be ‘data’ or data generated. Sometimes, an image or sound stored, received, or sent, will also be referred to as an ‘electronic record’.
The electronic record may be of any of the above forms, however, it must satisfy an additional essential requirement, namely, that it must be either in the form of an electronic form, microfilm, or computer-generated microfiche. If this requirement is also satisfied, then such a thing will be an electronic record in the eyes of the law.
Without knowing the definition of forgery, we can not move forward with Section 464 of the IPC, especially, when Section 464 is an essential component of the offence of forgery.
The offence called ‘forgery’ is defined under Sections 463 and 464 of the IPC, and the laws relating to it were further discussed in the provisions of Sections 465, 466, 467, 468, 469, 470, 471, 472, 473, and 474.
The definition of forgery in the IPC is not as clear and straightforward as it is in English common law. In common law, any fraudulent act of making or altering the content or information contained in a document, including an electronic record, deed, or any other negotiable instrument, etc., that is detrimental to the rights of another individual is called forgery, whereas, in the IPC, the definition provided is very wide and elaborate.
Basic elements of forgery
When we read the definition of forgery provided in Section 463 of the IPC, we will find many elements. Now, let us look into those basic elements of forgery that must be included in the alleged act of those accused of such an offence.
The offender makes a false document or electronic record. That making may include falsifying even a small part of the document.
While making a false document, the accused should have either of the following intentions, namely,
Intention to cause damage or injury to
The public as a whole, or
Any person;
Intention to defend or prove any claim or title of the valuable property; or
Intention to deprive any person of the possession and control over property; or
Intention to make any person enter into a contract, either expressly or impliedly; or
Intention to commit fraud. It may be either planning for the future or the said act of fraud has already taken place in the past.
The above-stated elements should be fulfilled, to construe an act as a forgery.
For instance, if a falsified or fake document that is not genuine, is being used by a person to gain something in terms of money, then such an act will not only be an offence of ‘cheating’ under Section 415 of the IPC but also an offence of forgery as defined under Section 463 of the IPC. The offence of forgery can also be committed through the use of computers, modern printers, scanners, or any other electronic device.
Examples
Some examples of forgery are as under:
Printing counterfeit currency notes,
Making fake certificates,
Falsifying stamp papers, and
Making a false document.
Significance of ‘intention’ for constituting forgery
From the above basic elements, it was quite apparent that damage or injury, either to the public or any person, must have been caused intentionally. That is, the accused must have done the alleged act with ‘intention’. This was also reiterated by the Karnataka High Court in R.R. Diwakar and Ors. v. V.B. Guttal (1973). Such fraudulent acts amount to forgery, only if intention is present on the part of the wrongdoer. Therefore, we can conclude that, in deciding whether an act or conduct amounts to cruelty, the court will consider the mental element of the accused. Conversely, if the intention is lacking, then such an act done by the accused is not a forgery, as per the wording of the Section.
For instance, in the case of Emperor v. Sanjiv Ratnappa (1932), a police officer changed his diary to show that some people were not under his surveillance. Here, a point was noted that the police officer did not commit forgery because of the absence of the element of intention while doing such an act as defined under Section 25 of the IPC and no loss or injury is caused either to any person or the public. Thus, intention was considered to be an important element to constitute an act of forgery. We can also tell that intention is the gist of this offence. Besides this, it is immaterial whether the objective or motive of the accused is accomplished or not. For example, a person with an object to cause injury to a person intentionally makes a false document. Here, while ascertaining whether the act is a forgery, it is immaterial whether his object has been accomplished or not.
Apart from the presence of intention, the act complained of must be done either dishonestly or fraudulently to constitute the crime of forgery. If the act lacks both components, then such an act may be a mere wrongful act, but not the crime of forgery.
The burden of proving intention in case of forgery
It is obvious that proving the intention of the accused in court is as important as the presence of the element of intention in a crime of forgery. Because, unless proven in a court of law, we can not tell that the accused has the intention to do such an act. Therefore, merely making a false document would not amount to the offence of forgery unless the intention to cause injury to an individual by way of defrauding or deceiving is proved in the court proceedings, as ruled in the case of T.N. Rugmani and Anr. v. C. Achutha Menon and Ors. (1990). Thus, the burden of proof to prove the intention of the accused beyond a reasonable doubt is on the prosecution.
Various provisions under the IPC on the offence of forgery
The provisions under the Indian Penal Code, 1860, relating to the offence of ‘forgery’ are not only discussed in sections 463, 464, and 465, as discussed above, but also in sections 466, 467, 468, 469, 470, 471, 472, 473, and 474. These sections discuss various scenarios of the offence of forgery to cover all possible actions that may amount to forgery. To know the same, see the table below.
Provisions under the Indian Penal Code, 1860
Offence discussed under the stated sections
Section 463
Forgery
Section 464
Making a false document or electronic record
Section 465
Punishment for forgery
Section 466
Forgery of record of Court or of public register, etc.
Section 467
Forgery of valuable security, will, etc.
Section 468
Forgery for the purpose of cheating
Section 469
Forgery for the purpose of harming the reputation
Section 470
Forged (document or electronic record)
Section 471
Using as genuine a forged (document or electronic record)
Section 472
Making or possessing a counterfeit seal, etc with intent to commit forgery, punishable under Section 467
Section 473
Making or possessing a counterfeit seal, etc with intent to commit forgery, punishable otherwise
Section 474
Having possession of a document described in Section 466 or 467 knowing it to be forged and intending to use it as genuine
Crime defined under Section 464 IPC – making a false document
As previously discussed, ‘making a false document’ is one of the basic elements of forgery. Because of its importance, that element was elaborately discussed under Section 464 of the IPC so that any ambiguity was removed. This particular Section is mentioned under Chapter XVIII which deals with offences relating to documents and property marks.
Here, it is important to note that both Section 463 and Section 464 deal with the offence of ‘forgery’. Section 463 sets forth that making a false document with the intention of defrauding or deceiving someone to obtain a wrongful gain due to such a dishonest or fraudulent act is known as a forgery. While Section 464 explains when a person is said to have committed forgery by ‘making a false document’.
We know that making a false document or electronic record is considered a forgery in the eyes of the law and will, thus, be liable under both Sections 463 and 464 of the IPC and, subsequently, be punished under Section 468 of the IPC.
Essentials of making a false document under Section 464 IPC
The definition explained under Section 464 of the IPC can be learned by explicating its essentials. So, the essentials of making a false document as described under Section 464 of the IPC are discussed below.
Making a document
Before everything, the accused should have done the act of ‘making’ a document, as alleged by the plaintiff.
Here, we should not look at the word ‘making’ in its literal sense. Indeed, the meaning of the expression ‘making’ has been widened due to judicial interference. Such as, not just writing or printing a document is ‘making’ as stated in the Section. Instead, signing, sealing, or otherwise executing it in a note or deed also means ‘making a document’. In clear terms, the word ‘makes’ refers to the words ‘signs’, ‘seals’, ‘affixes’, ‘execute’, or ‘makes any mark or change that denotes the execution’, etc. Therefore, the accused should have either signed, sealed, or executed a document. If the accused resorts to either of the mentioned modes, the court will consider that he has ‘made’ a false document.
For instance, A affixes the seal or signature of another person to a document, knowing that he is not empowered to do such an act, but still wrongfully gains something out of such dishonest and fraudulent acts. Here, A committed forgery by making a false document.
Furthermore, such a document can also be an electronic record, as specified by Section 91 of the IT Act, 2000. In the case of making an electronic record, the accused has made or transmitted any electronic record or part of it, including affixing any electronic or digital signature. The definition of ‘electronic signature’ is defined under Section 4(E)(ta) of the Information Technology (Amendment) Act, 2008.
Apart from ‘making’ such documents by signing and sealing, among other things, sometimes, the mere inclusion of any marks that convey the meaning that the document was executed or the electronic record is authentic is enough to construe the act as ‘making’ a document.
Such a document should be false
The other major consideration is that the alleged document should be false or contain content that is found to be false or that is not genuine. There is no requirement that the full content should be false, rather, even if a part of a document is falsified by the accused by following either of the stated modes, i.e., by signing, sealing, executing, etc., it is deemed to be a ‘false document’. Here, ‘content’ is not just information or matter contained in the document, but it also refers to the signature, seal, stamp, etc.
Furthermore, even if the person making the document is not an authorised person, such a document will still be regarded as a ‘false document’. For example, a person could imprint a signature on a document by using a stamp without the consent of the owner of that stamp. Here, the stamp used and the document in which it is imprinted are accurate, but the person is not genuine; that is, he is not a competent or authorised person to do such an act. Hence, even though the document and signature are proper in its face, such a signature is said to be falsified, and such a document is termed a false document in the legal sense.
Such making of a document must have been done dishonestly or fraudulently
The wrongful act of making a false document shall be committed by the accused dishonestly or fraudulently. That is, the presence of elements of either dishonesty or fraud is necessary. The meaning of the words ‘dishonestly’ and ‘fraudulently’ is discussed as follows:
Dishonestly
When you look at Section 464 of the IPC, you can find the word ‘dishonestly’ many times. Not just in this crime, but also in many crimes under the IPC, the crime must be committed ‘dishonestly’. Few among them are cheating, breach of trust, theft, forgery, etc. So, let us understand what exactly ‘dishonestly’ means according to the law.
The word ‘dishonestly’ is elucidated in Section 24 of the IPC. It connotes that if a person intentionally did some act for wrongfully gaining something, i.e., acquiring something to which he is not legally entitled, then such an act is said to be done ‘dishonestly’. Similarly, if a person does an act with the intention to cause wrongful loss to another person, i.e., depriving him of property over which he is the legal owner, it is said he has committed an act ‘dishonestly’. In both scenarios, the act done by a person with the intention to cause a wrongful gain to one person and, on the other hand, even intentional acts that result in a wrongful loss to another person are treated as ‘acts done dishonestly’. In addition, to prove an act to be dishonest, the presence of an ingredient of ‘deceit’ is not necessary. Furthermore, it is directed that Section 24 of the IPC should always be read with Section 23 of the IPC, which defines the words ‘wrongful gain’ and ‘wrongful loss’.
Let us understand this word more clearly through a situation. A person takes a pet dog from a house to sell it on the market for a lump sum amount. Here, the person who is committing such an act without the permission of its owner, knows the fact that such an act could cause wrongful loss to the owner and intends to gain something out of it. Thus, in this case, the person did the act of taking the dog away ‘dishonestly’.
Moreover, it is not necessary that both wrongful loss and wrongful gain be caused simultaneously in a given particular case. Either of them is enough to establish that an alleged act has been done ‘dishonestly’. Because there may be a few situations wherein there may be the existence of only either of the elements, not both. For instance, there is a wrongful gain for the deceiver, but no wrongful loss for the person deceived. But still, it may be deemed to be an act done dishonestly, although the second requirement is not satisfied. This was also laid down in the case, State of Uttar Pradesh v. Ranjit Singh (1999), by the Supreme Court.
Contrarily, it is also contended that a mere incorrect belief and persistence in a wrong or a mere irrational opinion cannot be termed an offence tainted with dishonest intent, as ruled in the case ofN. Vaghul and Ors. v. State of Maharashtra and Ors.(1986).
Fraudulently
Even the word ‘fraudulently’ is mostly used in Section 464 of the IPC, along with the word ‘dishonestly’. So, let’s see how the IPC interprets it.
The word ‘fraudulently’ is explained in Section 25 of the IPC. Once again, Section 25 of the IPC should always be read with Section 23 of the IPC, which defines the words ‘wrongful gain’ and ‘wrongful loss’. Here, the mental element, especially intention, of the person who committed an act should be taken into account to determine whether such an act was done ‘fraudulently’ or not. Thus, we can tell that the intention of the accused is a significant element in a fraudulent act, unlike in the case of a dishonest act.
Section 25 states that any act done by a person with the ‘intent to defraud’ is considered an act that has been done fraudulently. However, the meaning of the words ‘fraud’ and ‘defraud’ is not given anywhere in the IPC. Nevertheless, these words can be understood through literary meaning as well as judicial interpretation.
Fraud
Firstly, we should understand the word ‘fraud’. Fraud is an act of deliberate deception with a pre-planned action to secure something that is otherwise not anticipated. On the other hand, it was also observed that merely having the intention to deceive someone or doing an act fraudulently is not a crime which is punishable under the IPC, rather, the accused, with an intention to deceive, should have committed such an act, which was declared to be a crime under the penal code. A few examples are cheating, concealment of property, possession or delivery of counterfeit coins, forgery, etc., which are crimes in which an act must be done ‘fraudulently’.
Merely alleging or proving that an individual acted fraudulently does not mean that he has committed an offence punishable under the IPC or any other statute. If a fraudulent act is specified to be an ‘offence’ under the IPC or any other law for the time being in force, then such an act is said to be done fraudulently and will be punished under the Code, as decided in the case of Md. Ibrahim and Ors. v. State of Bihar and Anr. (2009).
Defraud
Secondly, we need to understand the word ‘defraud’ because, in the definition of the word ‘fraudulently’ itself, we can see the expression ‘intention to defraud’. The word ‘defraud’ has two components. Those are:
Existence of the element of deceit.
Caused injury to the person deceived. Injury can also be a monetary loss.
That is, to prove that a person defrauded another person, one person should have done some act, that had the element of deceit while committing it on another person and, consequently, caused injury or loss to another person. Here, deceit is the most important element in the acts done ‘fraudulently’, which is not the same in the case of the word ‘dishonestly’. With this, we conclude that both elements of the defraud which was mentioned earlier must be present in the commission of the disrupted act.
Here, it is noteworthy to say that there is a difference between the words ‘deceive’ and ‘defraud’, although they are interchangeable in the literal sense. The case of Dr. S. Dutt v. State of Uttar Pradesh (1965) reiterated the same by differentiating between the phrases ‘intent to deceive’ and ‘intent to defraud’. In this case, an expert was summoned to be present before the court as a defence witness and was asked to submit his credentials before the court. Later, it becomes apparent that the documents that were produced by the expert were fake. Here, we know that he acted as per the orders of the court and not voluntarily, and, hence, he has no intention to cause any person to act to his disadvantage. Therefore, it was held by the Apex Court that the expert did not act with an ‘intent to defraud’ and was convicted under Sections 193 and 196 of the IPC, but not under Sections 465 and 471 of the Code. Therefore, the intention of the accused is of paramount importance to ascertain whether an act was done fraudulently or not.
Making a false document should have been done intentionally
If either of the above acts was performed by the accused with the ‘intention’ of making someone believe that the signified document was made, signed, sealed, or executed by the authorities concerned, even though the accused has full knowledge that the stated act was not done by the authorities concerned but by himself or herself, the accused is said to have committed the offence of ‘making a false document’ under Section 464 of the IPC.
In the case of an electronic record or electronic signature, the accused should have the intention of making it look like it was either transmitted or affixed, although no such thing is done by the appropriate authorities. Here, intention is a very important element in proving the offence of making a false document by the accused.
Other acts that amount to ‘making a false document’
With the above discussion, we understood what crime is discussed under Section 464 of the IPC and its essentials. Now, let us move on to discuss two situations that will also be regarded as a commission of ‘making false documents’, which are discussed below in detail.
Alteration of material facts amounts to ‘making a false document’
If the accused made any changes to the material or important part of the document, that was already made or executed either by himself or someone else, he will still be convicted of the charge of ‘making a false document’. Here, the act must have been done without lawful authority, i.e., the accused is not legally empowered to make such an alteration to the executed document and must have been altered through cancellation or any other method. In other words, the accused has committed the act of dishonestly or fraudulently cancelling or altering a material part of a document without lawful authority, after the document is made or executed by a person, either living or deceased. Due to the technological developments in India, digital appliances are widely used for making false documents, and, hence, the rule applies to electronic records as well. That is, if the accused alters any important area of an electronic record, he will be charged and convicted under Section 464 of the IPC.
In the case ofSharvan Kumar v. State of Uttar Pradesh (1985), an advocate’s clerk forged the signature of another advocate on a surety bond and, also, altered certain endorsements for identification and attestation. The Supreme Court of India held that the acts of the clerk amounted to an offence of forgery.
Here, it is pertinent to note that mere alliteration in a document does not amount to the offence of ‘making a false document’ as held in the case of Parminder Kaur v. State of Uttar Pradesh and Anr. (2009). In this case, the accused merely added “1” to the date mentioned in the document. The Supreme Court held that an act done by the accused is not considered as ‘making a false document’ because the accused neither gained anything from such an act nor affected the limitation period.
The main difference between material alteration and mere alteration is the effect and consequence of an act done by the accused. If the alteration is detrimental to the interests and will of the plaintiff, then such an alteration is a material alteration, which amounts to the offence of ‘making a false document’. Whereas, if such an alteration is not contrary to the interests of anyone, then it is just a mere alteration and does not attract any charges. Thus, to attract the charges of forgery, the accused has committed such dishonest and fraudulent acts of alteration to gain something detrimental to others and with such an objective and intention to deceive or defraud someone.
Inducing someone by coercion or deception amounts to ‘making a false document’
The other situation is when the accused induces another person to sign or execute a document through illegal means like coercion, threatening, or deception, and that other person executes that document. Here, the accused will be liable for the commission of forgery, even though he did not sign or execute the document. In this case, that document was executed without the free consent of the person who is executing it and due to the elements like coercion, deception, etc., employed by the accused. Hence, such a document is deemed to be a false document.
Even Section 464 dealt with this aspect. Let’s study it in detail. The Section provides that the following dishonest or fraudulent acts by the accused will also come under the category of ‘making a false document’ and be convicted under Section 464 of the IPC.
The act of coercing or threatening an intoxicated or unsound individual to sign, seal, execute or alter the document or electronic record, or affix in case of digital signature. And, the said individual does the said act due to the reasons of intoxication or unsoundness.
The act of deceiving any person to induce him to sign, seal, execute or alter a document or an electronic record, or affix in case of electronic signature.
Additionally, the Section requires the additional condition to be proved, in the case of the above situations, that the stated person, who does the above activities due to reasons of intoxication, unsoundness, or deception, does not have knowledge of the content of the document or an electronic record, or the nature of the alteration.
Thus, a person who has not signed, sealed, or executed the document himself will still be punished under the offence of forgery, and his acts of inducing someone by incorporating methods like coercion, threatening, or deception would be regarded as ‘making a false document’, even if he did not ‘make’ it in a literal sense.
Signing one’s own name amounts to forgery
Surprisingly, a person signing his own name can also, sometimes, be called a convict of forgery. This is described under the explanation clause of Section 464. This rule was explained through situations illustrated in the Section itself. Those are given below:
We know there are various cases in which two persons will have identical names. Sometimes, the surname will also match. In those situations also, if one person signs with the intention of deceiving the other to believe it was signed by some other person, then such a signature is not genuine and he shall be liable under forgery. For instance, let us imagine A and B have the same name. With the intention of making someone believe that B has signed a bill of exchange, A signs in his own name. Here, the signature made by A is true, but A’s intentions are wrongful. In such scenarios where the sign or even a text may be true, but because the person is some other person than the intended person, such act of signing one’s name is said to be the commission of the offence of forgery.
We know that a person is said to commit the crime of forgery if that person signed using another person’s name. But, a person is also said to have committed forgery if he drew a bill of exchange in pursuit of the person who committed forgery. For instance, A signs in the name of C without his knowledge on a paper which will be drawn as a bill of exchange by B upon C. Here, it is apparent that A committed the crime of forgery. Additionally, B is also guilty of forgery, if he draws the bill following A’s intentions even after knowing the fact that A forged C’s sign on the paper. In this case, B did not forge his sign. But, still, he will be convicted under Section 464.
A person who has the same name as another person places an order and takes the benefit which has to be paid by the latter person due to the bill of exchange made by the former person. Here, it is clear that A has endorsed it in his own name. But still, he is guilty of forgery because he has the intention to deceive someone to make him believe that it was endorsed by the latter person.
Let us imagine a situation where a person, A, lost his land due to the court’s decree. After the execution of this decree, B purchased the estate. Later, after the sale of the property in question to B, A with an intention to defraud B entered into a lease agreement with C at a nominal consideration for a long period, even without any legal authority to do so. Alongside, he also dated the lease agreement six months before the sale of the property in dispute. Here, although the agreement is executed by A in his own name, still he committed forgery because he intended to deceive B that the said agreement happened before the sale of the property.
In anticipation of becoming insolvent, a person enters into a contract which transfers his remaining property or properties, either immovable or movable or both. This transfer of property will benefit him because once he was declared insolvent by the court, any person, especially his creditor, is not allowed to harass him or file a case against him for repayment of loan or debt. However, taking advantage of this relief which was made to protect the insolvent by transferring all his assets to someone else so that he will be declared insolvent by the court and default on all debts he has is not permitted by the court. If it is done, then the courts will look into the matter. And, if such an incident was proved, then those transactions are declared void and will be given to his creditors. For example, a businessman, M, entered into a contract with N for his benefit with the intention to defraud his creditor to whom he has to pay the debts. Furthermore, to make his argument strong in the court proceedings, he also wrote a promissory note in which it states that M is legally bound to pay a sum to N and antedates it to induce the court to believe that the note was made in the past. Here, it is said M committed forgery.
Signing in the name of a non-existent and deceased person amounts to forgery
Under the explanation clause, there is the second scenario which also amounts to forgery i.e., if a person signing or executing a document in the name of:
A non-existent or fictitious person with an intention to deceive someone by making someone believe that such execution is done by a real person, then he has committed forgery.
A deceased person by intending to defraud someone so that he believes that the document was executed by the deceased person during his lifetime, then he is guilty of forgery.
Illustrations
Section 464 discussed many examples for better understanding and to clear up any ambiguity if it existed. Those situations that amount to the offence of ‘making a false document’ are as follows:
X possessed the ‘letter of credit’, which was written by his bank, that was guaranteed to receive a payment of Rs. 10,000 from Z. Later, X, intending to defraud Z, added one more figure ‘0’ after Rs. 10,000 in that letter of credit. This, consequently, resulted in Rs. 1,00,000 because of the addition of ‘0’ by X. Here, X committed forgery through ‘material alteration’ because he altered the material fact of the letter of credit intending to defraud Z.
A used and affixed the stamp of B without the permission of B in a document that states that B has transferred his property to A. A did such an act intending to sell that property to another person once he acquired its possession so that A could gain the purchasing amount of that property illegally. In this case, A is said to have committed the offence of forgery by fraudulently affixing another person’s stamp. With this, it is once again clear that ‘making’ a false document or ‘signing’ with no authority are not the only acts constituting the offence of forgery, ‘affixing’ a stamp is also sufficient for the commission of forgery.
P collects a cheque from a bank that was signed by Q. That cheque is payable to the bearer, i.e., a person who possesses any negotiable instrument and is entitled to receive the payment through that instrument. The cheque, which is a negotiable instrument, that was received by P is blank. That means the area in which the amount has to be written is empty. So, P, who is the bearer of that cheque, knowing the fact that the cheque is payable to the bearer, committed a fraudulent act by writing an amount of Rs. 3,00,000 in that cheque to receive the payment from Q. Due to his wrongful act with deceitful intention, A is guilty of forgery.
M signs and gives a blank cheque to his agent, N. Alongside, M also authorises N to fill up the cheque by entering an amount with the condition that the amount entered should not be more than Rs. 1,00,000. However, contrary to the instructions made by the principal, the agent dishonestly made an entry of Rs. 1,20,000 in the cheque. In situations like these, agents are said to have committed the act of forgery.
S drew a bill of exchange in the name of T without his authority to do such an act. Here, S is a drawer and T is a drawee. Usually, the drawee is responsible to pay the amount mentioned in that bill of exchange. However, in case of any emergent situation, there is a provision in which the drawer has the option of discounting the said bill from the bank in place of the drawee. Misusing this provision, in the present case, S discounted it in place of T as a genuine bill with the intention to deceive the bank, making it believe that it had T’s security and use it on its maturity. Because of such ulterior intentions and fraudulent acts, S will be convicted for the commission of forgery.
E made a will, during his lifetime, which specified that his remaining properties, either movable or immovable, will be transferred to A, B, C and D in equal proportion after his death. But, B fraudulently made alterations to that will by scratching A’s name in the document. Because the material alteration was made with the intention to defraud A, the act of B amounts to forgery.
Y signed a government promissory note which contains the words “pay to Y or his order”. Hence, such a promissory note is payable to Y or his order by the act of endorsement by Y. Later, Z dishonestly removes the stated words by erasing or any other means because of which the promissory note became a blank endorsement from being a special endorsement. Here, the dishonest act of Z was a forgery.
G sold his immovable property to H for a reasonable and lawful consideration. Thus, the transfer of said property was completed. Nevertheless, G fraudulently made and signed another document which articulates that the transfer of property in dispute was already made by G to another person, J, even though no such thing has occurred. G also antedates the document to incorporate a belief on H that the property transfer to J was made eight months before it was transferred to him. In the present case, G is guilty of forgery.
F asks G to write a will on his behalf by putting whatever F has spoken or dictated down on a document. F instructed to write a legatee which was not followed by G and he intentionally and dishonestly wrote another legatee. Later, G misrepresented stating that he had prepared a will by following every instruction said to him which was not done to him and made F believe in his misrepresentation. This act of G amounts to the offence of forgery.
In the first scenario, A wrote a letter in which it was certified that A had good conduct by affixing B’s signature without B’s authority. Such a false document was executed by A with the intention to receive alms from C and any other person and induce C to give possession and control over a property. In this case, A committed the offence of forgery. In the second scenario, A forged a bonafide certificate to be employed under an employer, C by deceiving and inducing him to enter into a contract for service, either implied or expressed. Therefore, the same principle is applied to those cases in which a person fraudulently certifies himself in a letter regarding his good behaviour in order to obtain employment from a company, which results in the conviction of the person who has committed such a fraudulent or dishonest act, which is regarded as a forgery.
Other crimes which are punished under Section 464 IPC
Even after the enactment and subsequent amendment of the Information Technology Act, 2000, many provisions of the 163-year-old criminal code, i.e., the Indian Penal Code, 1860, are used as the only source of weapons for various cyber crimes. If one looks at the First Schedule of the IT Act, 2000, one would identify amendments made to the various provisions that are related to the offence of forgery. The word ‘electronic record’ was added beside the word ‘document’ wherever it was mentioned from Section 463 to 477A.
Now, let us look into those cybercrimes that can be punished under Section 464 of the IPC.
Website defacement
Website defacement is a form of cyberattack in which the attacker hacks a website and starts using it as its own. Firstly, he enters the source code of the website, and then he obtains access to make any kind of changes to it. Taking advantage of such a facility, the attacker dishonestly alters the content of the website and, also, adds new content, which is almost always defamatory. In general, this forging of websites, which is also an electronic record, is used against the government or religious websites for political or religious reasons. Such a dishonest and fraudulent act of altering content on a website and having the intention to make it believe that such alteration is genuine in order to cause wrongful loss to someone is called ‘website defacement’ and can be punishable under Section 465 of the IPC.
False electronic record
Fake accounts
Hearing the expression ‘fake account’ is not new to people in this modern world. Fake social media accounts are those social media accounts, which are also electronic records, that are created by one person and use the name and details of some other person without his or her assent. These instances are becoming more rampant these days. A person who disguises himself, by using a fake Facebook account or other social media account, to gain something inappropriately is said to have committed the offence of making a false document under Section 464 of the IPC and may be punished for such an act.
Digital forgery
In simple terms, ‘digital forgery’ is a forgery involving the use of electronic devices or systems. Forgery is making a false document and deceiving someone into believing that such a document is genuine. Whereas, digital forgery is the making of a false electronic record through the use of digital technology. Due to the advent of more sophisticated technology such as image scanners, desktop publishing systems, inkjet printers, colour lasers, and colour copiers, it became easy for criminals to make fake documents or electronic records, which include cheques, certificates, ID cards, currency, passports, and visas, among other things.
Modern technology like design, copying, and publishing technology is increasing the ability to produce high-quality counterfeit currency and financial instruments such as cheques, money orders, etc. One of the most famous cases was the case of State of Karnataka v. Abdul Kareem Telgi (2017), where Abdul Kareem Telgi, along with many others, was convicted of the offence of counterfeiting stamp papers and postage stamps, which cost several billion rupees. In this way, new technology paved the way for new ways of forging documents and financial instruments.
In addition to this, it may be noticed that Section 467, which deals with the offence of forgery of valuable securities, wills, etc., was not amended. The reason for this is that Section 1(4) of the IT Act, 2000, prevents the IT Act from applying to those documents or transactions that were mentioned under the First Schedule of the same Act. Among those documents are trust deeds, powers of attorney, contracts for sale, wills or transfers of immovable property, etc. Therefore, digital forgery and offences related to it are now covered only under the IPC in accordance with the amendments made by the IT Act, 2000.
Nature of offence under Section 464 IPC
The nature of the offence is non-cognizable, bailable, non-compoundable and triable by the magistrate of first class.
Non-cognizable
Making a false document is a non-cognizable crime due to its less serious nature. That means, the police officer, who is in charge, is empowered to arrest the accused only with a warrant from the magistrate. Additionally, he cannot even proceed with the necessary investigation without receiving permission from the court. Also, generally, these kinds of offences are bailable.
Bailable
Even though the act of making a false document is said to be forgery under the IPC and is considered a crime, it is not such a serious offence when compared with other crimes. Hence, it is, still, a bailable offence, as shown under the First Schedule of the Criminal Procedure Code, 1973. For bailable offences, granting bail is a right to the accused as a matter of course. Bail can be granted to the accused of forgery either by the police officer in charge or by the appropriate court after he provides satisfactory sureties for his appearances before the court.
Non-compoundable
On the grounds of its trivial nature, the offence of forgery falls under the category of non-cognizable and bailable offences. However, it is not so trivial that compromise between parties is allowed after the commission of such an act. Thus, forgery is a non-compoundable offence because it is not included under Section 320 of the CrPC, which provides a list of compoundable offences. The reason behind the exclusion of forgery from that list is that, sometimes, forging a document would not only affect an individual’s rights but also be detrimental to the public at large. So, if any compromise is allowed in these cases, the affected party will be society itself, not just a few individuals.
Triable by the magistrate of the first class
Because of the criminal nature of the offence of forgery, the competent court to hear the case is the criminal court. And, in the First Schedule of the CrPC, it is mentioned that cases of forgery are triable by the magistrate of the first class. After the judge examines the submitted statements, documents, and records of both parties to the suit, the judge will frame charges under Section 228 of the CrPC for further proceedings against the accused. Such further proceedings are held in accordance with the provisions of the CrPC.
Punishment for forgery under Section 464 IPC
Section 465 of the IPC deals with the punishment for forgery, which also includes the offence of ‘making a false document’. It states that the person who committed forgery is punished, under this Section. And, the punishment for the convict of forgery is imprisonment for a maximum period of two years, a fine, or both. Making a false document falls under the crime of forgery, which is also punishable under Section 465.
In the case of Tashi Dadul Bhutia v. State of Sikkim (2011), the accused, who is employed as a sanitation supervisor, committed the offence of making false documents. Here, the document is a trade licence. He also continued to issue those fake trade licences to many persons. For such dishonest acts by the accused, the Court convicted him for one year under Section 471, read with Section 465 of the IPC, and for simple imprisonment of two years under Section 468 of the IPC.
Besides this, in the case of Sheila Sebastian v. R. Jawaharaj and Anr. (2018), it was held by the Supreme Court that, to establish the commission under forgery and make a person punishable under Section 465 of the IPC, all ingredients stated under both Sections 463 and 464 have to be fulfilled.
Important case laws on Section 464 IPC
Sheila Sebastian v. R. Jawaharaj and Anr. (2018)
The case of Sheila Sebastian v. R. Jawaharaj and Anr. (2018) is a landmark judgement that strictly interpreted Sections 463, 464, and 465 and held that a person could not be held liable if he or she is not the maker of the document in its literal sense.
Facts of the case
There was a plot in a Valliyoor village, which was owned by Mrs. Doris Victor. Mrs. Victor was the initial complainant and also, the deceased mother of the appellant in the present case. The complainant claimed that R. Jawaharaj, the first accused, illegally impersonated himself as an agent of her by making a Power of Attorney (hereinafter referred to as ‘PoA’) in her name. It was further alleged that he also executed a mortgage deed based on the aforementioned PoA and, subsequently attempted to transfer the said property to Rajapandi, the second accused, for a consideration of Rs. 50,000.
Immediately after knowing this, she lodged a complaint with the nearest police station, which was later registered as an FIR. A final report was filed after the completion of the investigation under Sections 420, 423, and 424 of the IPC. The lower court convicted the accused. The defendants filed an appeal.
Decision and observation of the Madras High Court
The matter reached the High Court of Judicature at Madras on appeal, which resulted in a judgement in favour of the respondent by deciding that his conviction was not maintainable under Section 465 of the IPC.
By referring to the case of Guru Bipin Singh v. Sh. Chongtham Manihar Singh and Anr. (1996), the High Court stated that conviction under Section 464 of the IPC is not proved with appropriate evidence, especially in regards to ‘explanation 2 to Section 464’. The High Court furthered the scrutiny of the explanation, saying that “it is clear that to get attracted to the offence of forgery, ‘making of a false document’ is essential.”
Due to her dissatisfaction with the decision by the High Court, the appellant, the daughter of the complainant, Mrs. Doris Victor, approached the Supreme Court by filing an appeal.
Issues of the case
Whether the accused can be liable only under Section 464 IPC without proving the ingredients under Section 463 IPC?
Can the accused be punished under forgery if he is not a maker of the document?
Observation of the Apex Court
After examining the provisions of the IPC, namely Sections 463, 464, and 465, the Supreme Court found a co-relationship between them. That is, while Section 463 defines forgery, Section 464 explains when a false document is said to have been made by the accused, which is one of the ingredients of the forgery that leads to punishment under Section 465. It further observed that, in cases where the commission of forgery is proved as explained under Section 463, provided the ingredients under Section 464 are also satisfied, then conviction under Section 465 will be sustained. Therefore, proving the ingredients of both sections 463 and 464 is necessary to be punished under Section 465. If only one of them is satisfied, then punishment is not possible.
Besides this, the term ‘making’ means a conscious act by the maker of such disputed documents. The Court, by literally and strictly interpreting the Section, stated that if a person neither created nor signed it, he or she would not be punished under the offence of forgery. It also stated that merely causing a person to make such a document is not making a false document. If the accused himself made a document, then only he or she will be liable under the offence of forgery.
Judgement
The Supreme Court ruled that the respondents in the present case are not liable under the crime of forgery. Apart from this, the appellant received control and possession of the property in question through a judgement by a competent Civil Court in a common law action of the institution of suit against the validity of that mortgage deed.
The Court stated that it is not proved that the disputed document, i.e., the PoA, is a false document, and the accused have not made any false document to execute that mortgage deed. Thus, considering neither R. Jawaharaj nor Rajapandi is the maker of the forged document, the Supreme Court upheld the decision taken by the High Court based on the settled legal position.
The Supreme Court further observed that this case is a correct example of poor prosecution as well as a shabby investigation, which led to the conviction of the accused by the lower courts. The Court stressed the care and caution an investigating officer should exercise while exercising his functions. It was evident that the investigating officer in the present case did not investigate the mere fact of who executed the document.
Rajendra Singh gave an application for a caste certificate to the appropriate office in Guna, a city in Madhya Pradesh state. Depending upon the affidavits that support the application, applicant Rajendra Singh received a provisional caste certificate as issued by the Tahsildar concerned, Mr. Virendra Katare, in 2008. Later, he also obtained a permanent caste certificate, which stated that the applicant was ‘Sansi’. Nevertheless, the High Power Scrutiny Committee, which was formed to deal with these kinds of cases, claimed that the caste certificate by the applicant was forged by the government.
A criminal complaint was lodged against applicant Rajendra Singh under sections 420, 467, 468, and 471 of the IPC, stating that it was not mentioned anywhere that he belonged to the ‘Sansi’ caste during his education or initial business career. Instead, he mentioned ‘Sikh’ in various application forms for examinations, as per the documentary evidence submitted by the complainant.
Issues of the case
Whether the applicants committed the forgery or conspired to commit forgery and cheating?
Whether a document like a caste certificate issued based on no sufficient evidence be termed a forged document?
Observation of the Court
In cases where such a certificate is issued by someone who does not have the appropriate authority to issue a certificate or the document is prepared or made by himself, then the certificate would be called a false document and would be punished under the offence of forgery due to such an act. However, in the present case, the caste certificate was issued by the Sub-Divisional Officer, Guna (M.P.) i.e., the competent authority. Although the caste certificate was issued by the authority without sufficient evidence in hand, that document is not considered forged by the Court. The Court regarded it as a perfectly genuine document.
After referring to Sections 463 and 464 of the IPC, the High Court stated that the accused must have personally made a false document by writing or including fake information as per the description mentioned in Section 464 of the IPC, to be punished for the offence of forgery. If merely the stated information in the certificate is false, it is not considered a forgery, but it should also include the act of ‘making’ as explained in Section 464. However, in the present case, the caste certificate was made and issued by the competent authority. And, no applicant neither signed nor sealed to forge someone else’s signature or seal in such a document, rather, it is the Sub-Divisional Officer, who himself signed, made, and issued that caste certificate.
Therefore, because the document was issued by the officer concerned the document cannot be a forged document as per law even though the content of the certificate is not correct and entered without any support of sufficient evidence,
Judgement
Based on the above observation, the Court allowed the petitions passed by the applicants, quashed the criminal complaint registered against them, and directed the concerned court to stop trials against the aforementioned applicants. Further, the Court held that the applicants are not liable for forgery or conspiracy to commit forgery under Sections 463 and 464 of the IPC, because the permanent caste certificate is not a forged document.
Conclusion
To conclude, sections 463 and 464 are becoming saviours for those who fell into the trap of fraud by criminals. These sections indicate that if an accused makes a false document with the intention to defraud or deceive someone, having the object of gaining something wrongfully by causing someone to believe such a document or electronic record is genuine, he will be held liable under sections 463 and 464 of the IPC and be punished accordingly with imprisonment, a fine, or both. However, it should also be noted that merely making a false document without having any kind of intention to cause wrongful loss to someone will not constitute an offence of forgery. Similarly, based on various judicial pronouncements, it is clear that meeting all ingredients under ‘forgery’ is necessary, besides proving ‘making a false document’ in a court of law, to make the accused guilty under Sections 463 and 464 of the IPC.
Frequently Asked Questions (FAQs)
Whether mens rea is important to constitute the offence of forgery?
Meas rea or criminal intention, is the most important ingredient in proving an act as a forgery, as stated under Section 463 of the Indian Penal Code, 1860. If a person committed the offence of making a false document without an intention to cause harm or damage to someone, then such an act does not amount to the offence of forgery. Therefore, the intention should always accompany the act to make the accused guilty of forgery.
Furthermore, the burden of proof is on the prosecution to establish the intention of the accused beyond a reasonable doubt. The meaning conveyed by the expression “beyond reasonable doubt” is that an ordinary and prudent person cannot raise even the smallest doubt, no matter how small the doubt is, when a claim is presented in court with evidence. Hence, as we can tell, it is quite a tough job for the prosecution to prove the offence. This rule was introduced to reduce the burden on the judiciary because of frivolous complaints or cases.
What is the difference between mere alteration and material alteration of a document?
In Section 464 of the Indian Penal Code, 1860, it was stated that alteration of an important part of a document, which is also known as ‘material alteration’, is regarded as ‘making a false document’. But, there is a thin line between mere alteration and material alteration. That is, if the alteration made has the consequence of affecting the will and interests of the opposite party, then such an alteration is called ‘material alteration’. On the other hand, there will be a few alterations that will not detriment anyone. Sometimes, indeed, they will benefit the opposite party. In such cases, it is just a mere alteration and is not considered as ‘making a false document’.
Can a person who was not a maker of a false document, but caused it to make, be held liable under forgery?
It was a settled law through various judicial decisions that the accused would be convicted of a forgery crime only when he was the maker of that disputed document. Here, the ‘making’ should be interpreted in the legal sense, not literally. Preparing or creating a document is not ‘making’. If a person signs, seals, or executes a document, then it is considered as ‘making’ a false document in the eyes of the law.
Whether an arrest is made with or without a warrant under Section 464 of IPC?
The arrest of the accused is possible by the police officer in charge, although he has no warrant from the court because the crime is less serious comparatively and is non-cognizable.
References
“The Indian Penal Code” authored by Ratanlal and Dhirajlal.
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The write up highlights the impact of cyber crimes or terrorisms on the criminal justice system all across the globe. In this contemporary world, the usage of the internet and cyberspace is increasing rapidly with time. The advantages of this cyber world are enormous and it has become necessary as per the dynamic scenarios and requirements. The benefits come along with certain costs and drawbacks. With the increasing usage of computers and internet, cyber crimes are also increasing day by day.The Crackers (Hackers with malign intention) use to gain unauthorised access to the system he wants to breakin and he stops, destroys or gains information with malicious intentions. Cyber crimes are of various types, in most cases the intruder hacks the system of any individual, company or government etc. and damages or misuse the critical information for his own benefit. Since cyber networks are globalised and the realm of the cyber world is edgeless, problems arise here because criminals may or may not be from the same nation. These problems can be impenetrable for the governments, judges, prosecutors & the police of concerning nations where crime has taken place and the place which is affected by the crime and the place from where the crime is routed.
The criminal justice system
The criminal justice system mainly consists of:
Jurisdictional Courts
Prosecutors and defence lawyers
Law enforcing officers i.e., Police (cop).
Agencies detaining and supervising offenders, such as prisons and probation agencies.
Apart from these law-enforcing bodies, the main component to give judgement is based on concerning enforced law relevant to the case.
In India cyber crimes are covered and regulated by two majorly enforced laws i.e. Information and Technology Act, 2000 and Indian Penal Code, 1860. However in 2008, The IT Act 2000 was amended to include a more specific and outline definition of cyber crimes and charges punishments accordingly. However several amendments were also made in Indian Penal Code 1860 and Reserve Bank of India Act. Many bank related frauds and crimes are also common and rising daily due to the increasing use of online banking services and e- commerce. Any police officer not below the rank of Inspector authorised by the Central government has power to enter and search any public place and arrest without warrant the suspected person who has committed or of committing or being about to commit a crime.
These above mentioned laws are the basis of decisions to decide whether the accused is innocent or guilty. To give justice to the victim of crime related to the cyber world is quite complicated, in this case guilty can be from anywhere from the world, which is beyond the limits of local or national jurisdictional bodies to arrest or detain the accused easily. Definitely if the case involves a victim or guilty of outside the national boundaries then in both cases the government of that nation is also needed to be involved along with its law enforcing agencies and bodies and prevalent law regarding the crime of those nations. Problems become more complex when crime is routing through the jurisdiction of multiple nations. In those cases it becomes difficult to decide which country law will be applicable on the accused to prove him guilty. Jurisdictional laws and cyber laws of different nations are different so to grab the accused, it is necessary to have internationally skilled personnel having apt knowledge and expertise of different nation’s legal and cyber laws. To find such competent personnel is like finding water in the desert. Another issue is that concerning governments of the case should have amicable foreign relations to solve the case at ease. The crime cyber world is so intangible sort of in which it is challenging to provide evidence to prove the guilt of the accused. Many times the traces of crimes are proficiently eradicated by the criminal using sophisticated tools and techniques. Such situations are troublesome for the concerned jurisdictional system to solve the case.
Cybercrime in today’s scenario
In the present digital world which is majorly computer operated, serves the dark purpose of the perpetrators/intruders to intrude the systems easily from anywhere. Nowadays criminals are more keen to exploit the valuable intelligence information rather than physical assets of the people, organisation or nation because critical information leakage has greater potential of causing destruction as compared to limited physical loss. Eg: – Leakage of any critical information of defence system of a country into an unauthorised hand can be perilous to the nation’s security and can cause critical situations like war.
The cyber criminals can infect or damage or steal data of the target computer through malware. The most common types of cyber threats include hacking, phishing, denial of service(Dos) attacks, trojan horses, insider threats, malware attacks, computer virus, crypto jacking, spyware, cyber terrorism, identity theft, cyber extortion, ransomware, email or internet fraud, cyber espionage, illegal gambling etc. To curb and control such cyber attacks and threats UNODC (United Nations Office on Drugs and Crime) draws specialised expertise in criminal justice system response to provide technical assistance in capacity building, prevention and awareness raising, international cooperation, data collection and research & analysis on cyber crime.
According to Accenture’s State of Cybersecurity Resilience 2021 report, security attacks have increased up to 31% from the year 2020 to 2021. The number of attacks per company increased from 206 to 270 year on year. Attacks on companies affect individuals also because most of them store sensitive data and personal information from customers. In companies, cyber attacks are usually done by the assistance of an insider. We can protect computers and networks from unauthorised intrusion or malware by using these tools such as updated software, proper anti-virus software, firewall, strong passwords and timely changing passwords, biometrics entries, smart cards access, timely audit and investigations etc. The concept of cyber resilience is important because a cyber resilient business has the capability to build a secure business ecosystem and has strategies to overcome threats and capacity to mitigate and overcome damage rapidly and ability to continue operation even when situations are adverse.
Effects of cybercrime
The rapid growth of cybercrime in the world has increased exorbitantly and to tackle the increasing crime rates, the legislatures and government has to make certain changes in their laws to evolve their system to get hold of the misusers of cyber networks.
Following are the major effects of cybercrime that has impacted global justice system:
Causing difficulty in investigation
Crimes done using cyber networks are very difficult to trace and the criminals use such technologies through which they may change their locations and identifications. Therefore, it gets more complicated and almost impossible to track and trace the culprits. Even if the culprits are traced, it takes an ample of time which is detrimental to the objective of criminal justice of speedy delivery of justice. Through the internet, criminals easily communicate with other transnational syndicates and form a strong chain that’s very difficult to be traced and blocked. Thus, an incomplete and complicated investigation hinders the trial procedure and acts as an obstacle for police and prosecutors.
Lack of resource
Many countries lack enough resources to track and find out the cybercriminals. This helps criminals to continue their activities without any fear causing interventions in public’s personal lives, robbing people and banks, hacking mobile phones, computers etc. To detect the criminal’s exact location there is a need to have updated and high-tech technologies to track and detect the source computer through which cyber crimes are being committed.
Governing laws of the countries
Due to the advent of internet cyber crimes came into existence. The laws that were drafted before the internet age needs to be reformed and evolved according to the current society’s needs. Therefore, it is very important to bring amendments in the old Acts and make laws that include cybercrimes and their punishments as well.
The Budapest Convention
The first international treaty on cybercrime was the “Budapest Convention” on internet and computer crimes.It is also known as the “Convention on Cybercrime”.This convention was done by harmonising laws, improving investigation techniques and increasing cooperation among nations to control and investigate cybercrimes and provide fast and easy solutions for any crime done. Many countries like France, Japan, Canada, South Africa, Australia, Philippines and USA have participated, signed and ratified the convention, and a total 68 countries have ratified the convention. That means there are many countries who have not signed the convention on various grounds. Important countries like India and Russia have refused to adopt the convention on grounds that they have not participated in drafting the convention or adoption can violate the nation’s sovereignty and integrity and security. Many countries are re-considering the convention for adoption but sharing crucial data to foreign agencies is a matter of concern, that’s why they are still hesitating.
In India, Cyber crimes and e-commerce are regulated by “The Information Technology Act 2000” which was amended in 2008. Likewise different countries have their own laws to regulate such crimes but there is a need for common international law and an Act which can curb,control,regulate and investigate crimes and punish or execute the criminal accordingly, involved in the cross border crimes.
Involvement of United Nations
The United Nations is seeking to make a different treaty on cyber crime. Hoping this treaty will ease the judgement procedure for global crimes related cases involving different sovereign states.The dynamic and new technology has outmoded cyber law on cybercrime globally because the later is not amended or updated at the same pace as per changing technology and emerging novel crimes.
UNODC (The United Nations Office of Drugs and Crime) promotes sustainable and long-term capacity building among nations in fighting against cybercrime. In today’s time cybercrime is governed under UNODC by the United Nations. Till now there is no separate treaty formed for governing and regulating cybercrime.
According to General Assembly resolution 65/230 and Commission on Crime Prevention and Criminal Justice resolutions 22/7 and 22/8, the Global Programme on Cybercrime is mandated to assist Member States in their struggle against cyber-related crimes through capacity building and technical assistance.
Ways to tackle cybercrime globally
International and regional cooperation
A cybercrime can take effect from any place in the world and can target any individual, area, place, city or even a country. It is possible that a person sitting in India can plan, and attack on any computer source located in America. Therefore, in order to catch the culprit and fulfil the objectives of the criminal justice system, it is quintessential that the countries cooperate with each other and provide all necessary assistance in helping and aiding the countries in investigation of cybercrimes.
Amending and updating laws of the country
Since types and ways of committing crimes are evolving, there is a need to amend and update laws and technologies to counter the criminals and get them detected and arrested so that they do not dare to gather courage to do such activities.
Updated and high-tech systems and technologies
Adapting updated and high-tech systems is quintessential. As to catch criminals with high-tech systems there is a need to have similar or even better systems than the offenders.
Spreading awareness among their citizens
Whenever a new way of cyber crime gets reported, the authorities should inform their citizens regarding such type of crimes so that individuals be cautious regarding any new kind of fraud, hacking, robbery or any other cyber crime.
Conclusion
The borderless realm of cyberspace has increased the complexity of cybercrimes. The perpetrators and victims are located in different parts of the world. Though the United Nation is governing international crimes, there are many countries still hesitating to be a part of the global criminal justice system in order to avoid sharing crucial data and to save their nation’s integrity, security and sovereignty. As per the complexity of the crimes of the cyberworld it is required to have a separate international global body for governing, regulating, serving and assisting all nations in crimes related to cyberspace. If this body is formed it is going to prove very fruitful for all concerned nations in solving their cases involving cross border much effectively. To make this happen several countries are needed to work together in a collaborative manner to solve global crime.The main agenda of forming this global criminal justice system is to increase effectiveness and efficiency of investigation, prosecution and adjudication of cybercrimes.
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This article is written by Sai Shriya Potla, a student at the Pendekanti Law College, affiliated with Osmania University, Hyderabad. This article provides an in-depth analysis of the crime of hit-and-run in India. It further discusses the legal consequences of hit-and-run cases and the relief available to the victims.
Early in January 2023, a horrifying incident involving a woman being dragged to death in New Delhi stunned the whole nation. This incident increased attention towards hit-and-run cases. A hit-and-run case takes place when the driver of the vehicle that caused the accident flees the scene after causing the accident. Of all fatal accidents on national highways, hit-and-run incidents contributed up to 59 percent in 2021, an increase from 50 percent in 2020. According to the reports of the National Crime Records Bureau (NCRB), over 47,530 people lost their lives in hit-and-run cases. With the increase in hit-and-run cases in India, the legislation brought significant changes through Section 161 of the Motor Vehicles (Amendment) Act, 2019 with regard to compensation to the victims.
The following article provides comprehensive information on hit-and-run cases in India, the punishment mentioned under Indian laws, and the relief a victim can claim.
Laws applicable in case of a hit-and-run in India
Under Indian law, hit-and-run cases are governed by the Indian Penal Code, 1860, and the Motor Vehicles (Amendment) Act, 2019. The Indian Penal Code provides punishment for hit-and-run cases. It contains references to provisions for reckless and irresponsible driving that causes harm or hampers the safety of the public.
The Motor Vehicle (Amendment) Act, 2019 governs all aspects of road transport vehicles. The act awards compensation to the victims of hit-and-run cases. The compensation is given to cover all medical expenses and other losses that occurred as a result of the accident.
Provisions under the Indian Penal Code, 1860
The Indian Penal Code (hereinafter referred to as the “IPC”) makes reference to punishment for the negligent and reckless driving that hampers public safety. The majority of hit-and-run cases are caused by the negligent and irresponsible behaviour of drivers of motor vehicles. According to the reports, the main causes of these cases are claimed to be overspeeding and intoxication.
Section 279 IPC
Section 279 of the IPC addresses rash and negligent driving. Any person driving a vehicle in a public place in a rash and negligent way causing or likely to cause injury or endanger the life of any person will be liable under Section 279. To file a case under Section 279, the victim has to prove that he has suffered bodily injuries or created a life-threatening situation for the victim due to rash or negligent driving.
To constitute an offence under Section 279 of the IPC, the driving must be either rash or negligent. In the case of State of HP v. Manohar Singh (2011), the Supreme Court held that a single act cannot be both rash and negligent. It must be either one.
The word “rash” is defined as taking a deliberate action despite knowing the consequences of the action’s aftermath. And the word “negligence” is known as the omission of something to do by which a reasonable and prudent man is guided. Negligence is also referred to as a breach of the duty imposed by law for the safety of others.
Punishment
To convict a person under Section 279, there is no need to sustain injuries, it’s enough to show rash or negligent driving occurred that is likely to cause injuries or endanger the safety of the public. For the commission of a crime under Section 279 of the IPC, the person will be liable for imprisonment for a term of one year or a fine which may extend up to 1000 rupees, or both. The punishment and fine may differ from case to case based on the facts and circumstances of the case. The offences under Section 279 are bailable, cognizable, and non-compoundable in nature.
Case laws of Section 279 IPC
In the case of Ravi Kapur v. State of Rajasthan (2012), the Supreme Court held that the rash or negligent driving of a vehicle must be examined in light of the facts and circumstances of the case. The person who drives the vehicle will be held liable for the act as well as a result. The court further said that the speed of the vehicle is always not the factor to determine whether the person is driving it in a rash or negligent manner or not. The Supreme Court adopted the principle of reasonable care and res ipsa loquitur to determine the negligence of the accused. The doctrine of reasonable case is the standard of care the driver of a motor vehicle should exercise while driving. This principle differs in each case based on facts and circumstances. Res ipsa loquitur is a latin word that means the thing speaks for itself. This principle allows the court to infer the negligence of the driver by the way the accident is caused. The courts use parameters whenever there is no direct evidence found on record.
In the case of Pawan Kumar Sharma v. State of UP (1995), Pawan Kumar alias Papoo was convicted under Sections 279, 304A, and 429 of IPC for driving rashly and hitting a bullock cart from behind killing the cartman and the buffalo. The Allahabad High Court ruled that the person could not be convicted under Section 429 because there was no criminal intent or mens rea to cause harm or cause injury to the person in the bullock cart and the court upheld the conviction under Sections 279 and 304A as it fulfils the preliminary conditions of Section 279 and Section 304A.
Section 337 IPC
Section 337 of the IPC deals with the hurt caused by a rash or negligent act that endangers the life or personal safety of people. Section 319 of the IPC defines “hurt” as bodily pain, disease, or any kind of infirmity. There are certain similarities between Section 279 and 337 of the IPC, the Delhi District Court resolved the ambiguity regarding these in the case of State v. Balkishan (2013). The Court held that under Section 279, rash or negligent driving is likely to cause injury, but Section 337 is invoked when the act already results in the injury of the victim.
Section 279 explicitly covers the rashness or negligence of driving. The offence under Section 279 can even be constituted if there is evidence of rash or negligent driving, while Section 337 of IPC applies to any rash or negligent act which jeopardises the safety of people.
Punishment
For the commission of an offence under Section 337 of IPC, the person is punishable with imprisonment for a term that may extend up to six months or is liable with a fine of five hundred rupees or both. The offence punishable under Section 337 is bailable, cognizable, and compoundable in nature.
As the outcome of both the offences is the same under Section 279 and Section 337 of the IPC In case, if a person commits both crimes under both Section 279 and Section 337, the court will punish the offender under the section of higher magnitude. In Md Hiran Mia v. State of Tripura (2009), the Court said that the punishment under Section 279 is graver than the punishment under Section 337 of IPC and that Court declared that if a person commits both the offence under Section 279 and 337, the offender should be punished under Section 279 of IPC.
Case laws on Section 337 IPC
In the case of State v. Gulam Meer (1955), the Madhya Pradesh High Court held that to constitute an offence under Section 279 of IPC, there must be rash or negligent driving which is likely to cause injury or endanger the safety of the public. The driver will be liable under Section 279 for his way of driving even if there is no injury caused to the public. But under Section 337 and Section 338, rash or negligent driving should result in hurt or grievous hurt respectively.
In the case of State v. Vijay Kumar (2012), the Delhi District Court said that to prove an offence under Section 337 of IPC, the injury must be by rash or negligent driving and the injuries must be simple in nature. The court also held that to impose criminal liability on the accused the injury must be the proximate or direct effect of the accident. It must be causa causans (immediate cause) and not causa sine qua non (necessary cause).
Section 338 IPC
Section 338 of the IPC talks about a rash or negligent act which causes grievous hurt or endangers the human life or personal safety of the public. Section 337 refers to hurt, whereas Section 338 of the IPC deals with grievous hurt caused by a rash or negligent act. Grievous hurt is referred to as a serious kind of hurt, where a person couldn’t perform his daily or ordinary tasks.
If a vehicle collides with a man while driving rashly or negligently resulting in a fracture, disfiguration of the face, or privation of joint, sight, or hearing power permanently, the driver will be punished under Section 338 of IPC.
Punishment
If a person is liable for an offence under Section 338 of IPC for causing grievous hurt to the victim, he will be punished with imprisonment for two years or a fine that may extend up to one thousand rupees or both. The offence under Section 338 is bailable, cognizable, and compoundable in nature.
Case laws on Section 338 IPC
In the case of Shiekh Munna v. State (2016), the accused who was driving in a rash manner hit the car to the scooter from the opposite side. The victim fell from the scooter and was grievously hurt. The victim suffered from the dislocation of the bone. The Delhi District Court held that the dislocation of bone falls within the definition of grievous hurt under Section 320 and ruled that the accused is liable under Sections 279 and 338 of IPC.
In the case of Ajay Jain v. Common (2014), the victim’s family was going to Halena from Delhi in a car. A tractor fully loaded with bricks was in front of the victim’s car. The driver of the tractor without any indication negligently and recklessly stopped the car on the road leading to the collision of the victim’s car with the tractor. Petitioner and his wife suffered from grave injuries. The petitioner’s newborn baby died in the accident. The Delhi District Court found the driver guilty and punished him under Sections 279, 337, 338, and 304A of IPC.
Section 304 IPC
Section 304 of the IPC talks about culpable homicide not amounting to murder. Any person who commits any act that results in the death of a person will be punishable under Section 304 Part II. The main ingredient of Section 304 Part II is that the person doing the act should have knowledge of the action but he should not have the intent to do so.
If a person drives the vehicle at a high speed knowing the consequences of it and ultimately hits a person and leading to his death will be liable under Section 304 Part II. In the above illustration, the offender has no intention to cause any harm to that person but has full knowledge of his act.
Punishment
If any person commits an offence under Section 304 Part II of IPC, he will be punished with imprisonment for a period of ten years or will be liable with a fine or both. The offence is punishable because it is non-bailable, cognizable, and non-compoundable in nature. But if a person drives in a manner with a real intention to cause the death of another person will be punished under Section 302 of the IPC with death or life imprisonment and will be liable with a fine.
Case laws of Section 304 Part II IPC
In the case of Arnav Chowdary v. State of West Bengal Anr. (2022) the accused was driving the vehicle at a very high speed leading to the death of one of the co-passenger. The Calcutta High Court held that the offence would fall under the provisions of Section 304 Part II, not under Section 304A. The Court further held that a prudent man would not drive a vehicle at a speed and dangerous speed which he cannot control and he would have full knowledge of the consequence of the act.
In the case of Jasdeep Singh Kohli @ Louvi v.The State Of Nct Of Delhi (2016), the accused was on patrolling duty at night. The accused on his bike overtook a car ahead of them at a very high speed and hit the divider. The person sleeping on the divider was dead on spot. The people in the car behind the accused also suffered from grave injuries. The Trial Court ordered that the accused is guilty under Section 304 Part II. This decision of the Trial Court was challenged before the Delhi District Court. The Court upheld the decision of the Trial Court and held that the person is liable under Section 304 Part II
Section 304A IPC
Any rash or negligent act of a person resulting in the death of another person will be punishable under Section 304A of IPC. The main element of Section 304A is that the person’s death should not be a culpable homicide. Culpable Homicide is an act of causing the death of a person with an intention to cause bodily injuries or death. But under Section 304A, there is no intention present to cause injury or death of the victim during the accident to be constituted as an offence under Section 304A. The death of the victim must be the direct and immediate effect of the accident.
It must be proved that there is a breach of duty by the victim to file a case under Section 304A of the IPC. However, if the accident is caused by the victim’s own negligence then this section will not be applicable.
The court adopted the parameter of “reasonable care” to determine the negligence or rashness of the driver. The reasonable care will differ from case to case based on facts and circumstances. For example, the speed of the vehicle must be relatively less than that of highways.
Punishment
If the driver leads to the death of any person, the driver will be liable under Section 304A of IPC. The offender will be punished with imprisonment for a term of two years or with a fine or both. The offence punishable under Section 304A is bailable, cognizable, and non-compoundable in nature.
In the case of Thakur Singh v. State of Punjab (2000), a bus with 41 passengers fell into the canal while crossing the bridge due to the driver’s negligence leading to the death of all the passengers. The court applied the principle of res ipsa loquitor and held that the burden shifts to the person in control of the vehicle. Evidence has been found that the tree hit a tree before the occurrence of the accident. The Court determined that only a rash or negligent act of the driver could cause the accident as no mechanical defects in the automobile were found. The Court held that the driver is liable under Section 304A of IPC.
In Prafulla Kumar Rout v. State of Orissa (1994), after the closure of the school, while the students were crossing the road, a bus at a high speed dashed over a minor girl named Bhanumati Pande and drove over her leading to her death. The Orissa High Court held the driver is liable under Section 304A of IPC. The Court further said that high speed is a relative term, it depends on nature, the situation of the road, and the concentration of pedestrians.
Section 308 IPC
Section 308 deals with the attempt to commit culpable homicide. Section 308 of IPC applies to two situations.
Whoever does any act in sudden provocation with intention or knowledge, and that act is likely to lead to the death of the other person, he would be punished under Section 308 of the IPC.
If any person does an act in given circumstances with intention or knowledge that results in the actual injury of the victim, the offender will be liable under the attempt to commit culpable homicide of Section 308.
Punishment
Section 308 of the IPC deals with the attempt to commit culpable homicide. If a person attempts to kill another person under sudden provocation but the person inflicts no harm to the victim, he will be punished with imprisonment of three years, or a fine, or with both. But if the act results in harm to the victim the offender will be punished with imprisonment of seven years or a fine, or with both. The offence under Section 308 is non-bailable, cognizable, and non-compoundable.
Case laws of Section 308 IPC
Allahabad High Court in the case of Vijay Mishra v. State of UP Thru. Secy. Home Deptt. Lko. And Anr (2022)held that even not causing any hurt can be constituted as an offence under Section 308 of the IPC, if a person attempts to commit culpable homicide in such circumstances with such intention or knowledge the given act would cause the death of another person.
In the case of Ramji Prasad v. State of UP and Another (2023), the Court observed that to constitute an offence under Section 308 the intention and knowledge are more material than the injuries caused.
Compensation for hit-and-run case victims
Every year, hit-and-run cases have resulted in the deaths and fatal injuries of numerous people, costing them their livelihoods. Many people don’t even have the financial means to afford medical treatment for injuries arising out of these accidents. The Motor Vehicles (Amendment) Act, 2019 has made provisions for compensation to victims of hit-and-run cases to make up for their losses.
The Motor Vehicles (Amendment) Act, 2019 came into force on September 1, 2019, making significant changes to the Motor Vehicles Act, 1988. The major objectives of the Act are to improve road safety and environmental health, increase the fitness of vehicles, maintenance of roads, and increase compensation for hit-and-run case victims.
Section 161 of Motor Vehicles Act
Section 161 of the Motor Vehicles Act was amended in 2019. Section 161 of the act covers the compensation to be given in the hit and run cases. Section 161(2) provides compensation for grievous hurt and death caused by hit-and-run cases.
The Motor Vehicles (Amendment) Act, 2019 provides an amount of up to Rs. two lakhs in case of death arising out of these accidents. The compensation amount was increased from Rs. twenty-five thousand after the 2019 amendment to the Motor Vehicles Act. And in the case of grievous hurt, the Act awards compensation of Rs. fifty thousand rupees, which was increased from Rs. twelve thousand five hundred rupees after the amendment.
Section 161(4) of the Act mentions that the central government will provide a scheme that will be administered by the General Insurance Council mentioning the form and manner of the applications to be made for compensations and all matters related to payment of compensation.
Section 161(4) of the Motor Vehicles Act mentions that contravention of any provision under Section 161 will lead to imprisonment for a period of two years and a fine of not less than twenty-five thousand rupees and may exceed five lakh rupees. The provision also mentions the amount provided by the central government for interim relief. Interim relief is the sum paid to the victim before the settlement of the total compensation. Interim relief is granted to cover personal or medical expenses that need immediate effect.
The Compensation to Victims of Hit and Run Motor Accidents Scheme, 2022
The Compensation to Victims of Hit and Run Accidents Scheme, 2022 specifies that a Standing Committee will be constituted to review the functioning of the scheme. The scheme mentions that an officer not below the rank of Joint Secretary of the Ministry of Road Transport and Highways will be the chairman of the committee and the other members of the scheme will be officers from other ministries of the central government. And one member will be nominated by the General Insurance Company as the Member – Secretary.
The Standing Committee monitors the operation of the process of providing compensation to the victims under the scheme. The committee supervises the consideration of the General Insurance Council Report. The Standing Committee guides the Insurance Council on the implementation of the scheme and provides specific directive steps whenever necessary.
The Committee overviews the functioning of the District Level Committee and also considers the quarter reports and provides directions or guidance. The Standing Committee has the power to suggest to the Central Government to make recommendations for the effective working of the Scheme and to prevent fraud.
The General Insurance Company will prepare an Annual Report on the implementation of the Scheme for the Standing Committee and a copy to the Central Government.
District Level Committee
The Scheme mentions that there will be a District Level Committee created in every district to implement the provisions of the Scheme. The Claims Settlement Commissioner will be the Chairman of the District-Level Committee. A member will be nominated by the General Insurance Council as Member – Secretary. Senior officers from different departments of the State Government will be joined as members of the District Level Committee. A few members of the Committee will be nominated by the State Government.
The main function of the District Level Committee is the implementation of the scheme in the concerned district. The Committee has full authority to take necessary actions to ensure the effective and competent implementation of the Scheme.
The District Level Committee has to submit a report to the Standing Committee including the statistics of compensation claims received, the claims awarded, and the pendency of the claims, and reasons for such pendency.
The Scheme provides that the Committee shall maintain proximate relations with the other authorities in the district to make publicity about the scheme. It is the responsibility of the Committee to spread awareness among the people about the contents of the Scheme and educate them about their rights. The Committee upon asked will provide guidelines or clarifications to the concerned authorities or claimants.
The Procedure for the payment of compensation
The scheme provides the procedure for receiving the claims for compensation. The applicant has to file an application along with a copy of the claim raised by the hospital to the Claims Enquiry Officer of the Sub-Division or Taluka where the accident took place. On receiving the application, the Claims Enquiry Officer will hold an inquiry of the claim with the First Accident Report (FAR) and the postmortem report.
The scheme specifically mentions that the Claims Enquiry Officer has to find out the rightful claimant. The Claims Enquiry Officer will send the application along with the recommendations and all necessary documents to the Claims Enquiry Commissioner within a month of filing the application. The Clams Enquiry Officer has the right to reject any application but he shall also mention the reasons for not accepting the application to the applicant.
The payment will be made by the Claims Enquiry Officer within fifteen days from the date of receipt of the Sanction Order. If the payment of the compensation exceeds thirty days, the reasons for such delay must be mentioned to the Claims Enquiry Officer.
In the case of the death of the victim under the hit-and-run case, compensation will be awarded to the legal representatives of the deceased. And if a victim sustains grievous injury in the accident, the person injured will receive compensation. After the disbursement of the compensation, the Claims Enquiry Officer will maintain the record with the date of payment and the claim awarded.
Section 162 of Motor Vehicles Act
Section 162 of the Motor Vehicles (Amendment) Act, 2019 mentions the “Scheme for the Golden Hour”. The section makes provisions for the cashless treatment of the victims during the golden hour. The “Golden Hour” is the first hour after the accident. If the victim receives proper medical care or definitive treatment within the period, the chances for survival of the person increases greatly.
The Compensation to Victims of Hit and Run Motor Accidents Scheme, 2022 mentions the provisions in relation to Section 162 of the Act. The amount will be transferred from the Hit and Run Compensation Account to the Account for Uninsured Vehicles, which is a part of the fund used for the cashless treatment under Section 162 of the Motor Vehicles Act. But if the claim raised by the hospital is more than the fixed compensation mentioned under Section 162 of the Act, no compensation will be provided to the victim.
Section 163 of Motor Vehicles Act
Section 163 discusses the refund of certain cases of compensation paid under Section 161. Section 163(1) mentions if a person is awarded with the compensation equivalent to Section 161 of the Motor Vehicle (Amendment) Act, 2019 for grievous hurt or death arising out of a hit-and-run case by any other law, the person will be liable to refund the amount received under Section 161 to the insurer.
Section 163(2) states that the claims tribunal, court, or any authority awarding the compensation will inquire and verify whether or not the compensation for death or grievous hurt under Section 161 has been awarded.
Section 164 of Motor Vehicles Act
Section 164 of the Motor Vehicles Act authorises that the death and grievous hurt arising out of the motor vehicle accident, in case of no-fault liability the compensation of Rs. five lakhs and Rs. two and half lakhs, respectively.
After the amendment, to claim compensation under Section 164 of the Act there shall be no necessity for the victim to establish or prove before the court, the death or grievous hurt is caused due to the negligence of the owner or driver of the motor vehicle. If the compensation for the death or grievous hurt arising out of an accident is paid under any other law, the compensation under this section will exclude the initial sum paid under other law.
Section 164B of Motor Vehicles Act
Section 164B makes provision for establishing a Motor Vehicle Accident Fund. The fund is used to make payment of compensation to legal representatives of dead or grievously hurt persons as mentioned in Section 161 of the Act. It is also used in making cashless payments to victims under Section 162.
A trust will be formed in accordance with the Motor Vehicle Accident Fund of Section 164B. An officer not below the rank of Joint Secretary from the Ministry of Road Transport and Highways will be appointed as the Chairman of the trust and the Director of the Ministry of Road Transport and Highways will be the member-coordinator. And officers from other ministries of the central government and the General Insurance Council will act as members of the trust.
The trust is formed for the effective management of the fund. The trust timely supervises the annual report of the contributions of the Motor Vehicle Accident Fund. The trust also has the power to recommend to the central government on implementation of the Compensation to Victims of Hit and Run Motor Accidents Scheme, 2022.
Components of income for the Motor Vehicle Accident Fund
There are three accounts within the Motor Vehicle Accident Fund
Account for Insured Vehicles
Account for Uninsured Vehicles
Hit-and-Run Compensation Account
1. Account for Insured Vehicles: Account for Insured Vehicles is used for cashless treatment of victims caused by insured vehicles. This account is administered by General Insurance Council under the Trust. Some amount from the insurance companies running their business in India will be contributed to this account.
2. Account for Uninsured Vehicles: This account is utilised for cashless treatment of victims caused by uninsured vehicles. The tax collected by the Central Government on the National Highways, budgetary grants by the Consolidated Fund of India, and fines collected through Section 198A of the Motor Vehicles Act are the sources of this account. This account is controlled by the General Insurance Council under the Trust.
3. Hit and Run Compensation Account: Hit and Run Compensation Account will be utilised for the victims of Hit and Run cases. This account is also used for reimbursement of money to the Account for Uninsured Vehicles for cashless treatment under Section 162. This account is administered by the General Insurance Council under the Trust. The balance under the Solatium Scheme will be transferred to this account.
Motor Vehicles Claims Tribunal
Motor Vehicles Claims Tribunal is an adjudicating body established for the settlement of compensation claims with respect to accidents resulting in death, bodily injuries, or damage to third-party property caused by a motor vehicle. Section 165 authorises the state government to constitute one or more claims tribunals in an area. The state government with general or specific order regulate the distribution of business among them.
The claims tribunal will consist of the number of members as decided by the state government. If the members of the claims tribunal are two or more than two, one of them will be appointed as the chairman. Section 165(3) specifies that the members of the claims tribunal should be a District Judge or High Court Judge or a person qualified to be appointed as a High Court Judge.
Section 165 of the Motor Vehicles (Amendment) Act, 2019 grants the state government the authority to constitute the Motor Vehicles Claims Tribunal for adjudication of cases arising out of motor vehicle accidents involving death, grave injuries, and damage to property. Section 166 mentions that the application before the Claims Tribunal must be before six months of the occurrence of the accident.
Role of insurance companies in hit-and-run cases
The Motor Vehicles (Amendment) Act, 2019 mandates third-party insurance of motor vehicles. There are three parties in this insurance policy – the insured, insurance company, and the third party. If the insured caused any injury to the third party with a motor vehicle, the insurance company will compensate the third party, but the insurance scheme will not provide any benefit to the insured for the loss that occurred in the course of the collision.
The insurance company can provide compensation for only those damages that are covered in the insurance policy. For instance, if the driver does not have a valid driving licence or if the driver is found under the influence of alcohol the insurance company will not provide any compensation.
Famous hit-and-run cases in India
Sanjeev Nanda v. State (2009)
The case is famously known as the 1999 BMW Delhi hit-and-run case and is one of the most known hit-and-run cases in India. Sanjeev Nanda is the grandson of the Indian Navy Chief and son of Indian arms dealer Suresh Nanda.
Facts of the Case
In the early morning of January 10, 1999, Sanjeev Nanda drove a black BMW car on seven people on Lodhi Road, New Delhi killing 6 persons and injuring one person.
The charges were arrested against Sanjeev Nanda and his Co-accused Manik Kapur and Siddharth Gupta, later Siddharth Gupta was discharged by the Bombay High Court. Rajiv Gupta, Bhola Nath, and Shyam Singh Rana were arrested for the destruction of evidence under Section 201 Part III. Sanjeev Nanda was found under the influence of alcohol during the course of the accident. The Bombay High Court found Sanjeev Nanda guilty under Section 304 Part II of IPC for Culpable Homicide not amounting to Murder.
Sanjeev Nanda filed an appeal in the Supreme Court challenging the order of the Bombay High Court for conviction under Section 304 Part II and the right to a speedy trial.
Observation
The Supreme Court opined that the appellant was in a drunken state, and he drove the motor vehicle knowing the consequences of the act but with the hope that he would not get caught. All these components are part of the provision of Section 304A of IPC. The Hon’ble Supreme Court held that the facts of the case would attract the provisions of Section 304A of IPC.
Judgement
The Supreme Court overruled the judgement of the Bombay High Court by altering Sanjeev Nanda’s conviction from Section 304 Part II to Section 304A of IPC. The Supreme Court ordered Sanjeev Nanda to be sentenced to two years of imprisonment.
In 2012, the Delhi Police filed an appeal before the Supreme Court to increase the sentence of Sanjeev Nanda. The Delhi Police further appealed to change the conviction from Section 304A to Section 304 Part II stating that he was driving the vehicle without a licence and was under influence of alcohol and these facts are enough to constitute knowledge under Section 304 Part II. But the Supreme Court quashed the appeal.
Alister Anthony Pareira v. State of Maharashtra (2012)
On the early morning of November 12, 2006, Alister Anthony, a 21-year-old drove over the labourers sleeping outside their huts killing seven people and injuring eight of them at Bandra, Mumbai. On investigation by the police, alcohol traces were found in his body. The Bombay High Court found Alister Anthony guilty under Sections 304 Part II, 337, and 338 of IPC for death and causing injuries to the labourers. Alister Anthony preferred to appeal against the decision of the High Court in the Supreme Court.
Observation
The Supreme Court agreed with the contentions of the Bombay High Court that the accused drove the car at a high speed and under the influence of alcohol despite he being a member of the same locality and knowing labourers sleep out every night. It was argued on behalf of the accused that he had already spent two months in jail and the accused paid compensation of rupees 8,50,000 and is ready to pay more. It was further argued to reduce the sentence given to the accused. The Supreme Court refused to accept the contentions of the accused and said that there can be no modifications in the punishment for causing such an aggravated offence of killing seven precious lives.
Judgement
The Hon’ble Supreme Court upheld the decision of the High Court and held that there shall be no reduction of sentence for good conduct. The Supreme Court ordered Alister Anthony to undergo the sentence given by the Bombay High Court.
Shilpa Mittal v. State of NCT of Delhi (2020)
Shilpa Mittal v. State of NCT of Delhi (2020).also known as the 2016 Mercedes hit-and-run case is an infamously famous case for a juvenile causing the death of a 32-year-old man in an accident.
Facts of the Case
A minor who was 4 days short of 18 years old committed an offence under Section 304 by hitting down Siddharth Sharma, a 32-year-old business consultant, with his father’s Mercedes in North Delhi’s Civil Lines.
The Juvenile Justice Board ordered that the minor should be tried as an adult, keeping in mind that he had committed a heinous crime. The Delhi Sessions Court agreed with the decision of the Juvenile Justice Board, while the Delhi High Court overruled the decision of the Juvenile Justice Board in 2019. The sister of the deceased victim appealed to the Supreme Court against the decision of the Delhi High Court.
Observation
The Supreme Court also agreed with the opinion of the Delhi High Court. Section 2(33) of the Juvenile Justice Act, 2015 provides that offences for which minimum punishment is more than seven years are considered as serious and heinous offences and juveniles can be tried as an adult under this section. Section 304 of the IPC mentions maximum imprisonment of ten years and there is no reference to the minimum imprisonment in the Section. The Supreme Court observed that the Juvenile Justice Act, 2015 does not have provision for the 4th category of offences viz., offences for which the maximum imprisonment is more than seven Years.
Judgement
The Supreme Court held that the minor would be tried as a juvenile, not as an adult, and instructed the Parliament to make provisions for the 4th category of offences in the Juvenile Justice Act, 2015.
Conclusion
Stringent provisions of punishment and compensation for hit-and-run cases are adopted in the Indian Penal Code, 1860, and the Motor Vehicles Act, 2019, respectively, to ensure the prevention of similar accidents. Punishment under the Indian Penal Code, 1860, has provisions that cover all aspects of accidents, making it impossible for the offender to evade the punishment. The changes in the Motor Vehicle (Amendment) Act, 2019 like compulsory third-party insurance for motor vehicles, cashless treatment in the golden hour, and the increase in compensation for victims of hit-and-run cases are extremely beneficial in terms of better medical care and other losses.
Frequently Asked Questions (FAQS)
What is the punishment for death in hit-and-run cases in India?
The person will be convicted under Section 304 Part II or Section 304A of the IPC based on his or her knowledge and intention. The maximum punishment under Section 304 Part II is imprisonment of 10 years or a fine or both. Under Section 304A of the IPC, the person will be punishable with a maximum punishment of two years or a fine, or both. But if the person has real intention and knowledge to cause the accident, he will be punished under Section 302 of the IPC with death or life imprisonment and a fine.
What is the compensation for hit-and-run cases in India?
Section 161 of the Motor Vehicles (Amendment) Act, 2019, provides the victims of Hit and Run accidents with compensation of Rs. 2 lakhs for death and Rs. 50,000 for grievous hurt.
Where can victims claim compensation for hit-and-run accidents?
The victim or the legal representatives of the victim should submit an application along with the claim raised by the hospital to the Claims Enquiry Hospital of Sub-Division or Taluka where the accident took place.
What should a person do as a victim of a hit-and-run accident?
The victim should check for injuries, gather information about the perpetrator and inform the nearest police station, file a First Information Report (FIR) and provide accident details in order for the police to start the investigation.
If the victim is seriously injured in the accident, any person present at the accident scene must bring the victim to the hospital and provide him with the necessary medical attention and inform the police station about the accident. The person who assisted the victim and provided the information to the police about the accident will be known as “Good Samaritan” under Section 134A of the Motor Vehicles Act. The police can examine the good samaritan if he agrees to be a witness to the accident.
References
Ratanlal & Dhirajlal, The Indian Penal Code (36th Edition) 2020
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In general terms, auditing refers to independent examination of primary financial statements of a company. Primary financial statements consist of a profit & loss statement, balance sheet and cash flow statement. Auditing refers to the process of checking and analysing the financial statements of any company with the purpose to provide opinion whether the financial information is providing a true and fair view and prepared in accordance with applicable accounting standards. Financial information is very crucial as these represent the performance of a company for a specific period of time. These provide useful information to many users such as shareholders, creditors/suppliers, customers, investors, government and tax authorities. This article discusses the general idea about auditing for its readers.
What is auditing
Auditing can be defined as an on-site verification process which involves either inspection or examination of any process or system functioning, in order to ensure abidance of set-out compliances or requisites. The process of auditing can be applicable to either the entire firm or a particular functioning of that firm. Validity or reliability of any kind of information, irrespective of the source of such information, is a necessity. This becomes one of the prime grounds for effective functioning of the firm or individual associated with such information.
How does auditing work
Although the process by means of which auditing works is complex, the same can be understood simply as well. An independent Certified Public Accountant (CPA) firm or internal staff of the organisation may conduct the audit. The financial statements of almost every company, including the income statement, balance sheet, and cash flow statement, are annually audited. Borrowers also agree to annually accept the results of an external audit as part of their debt covenants. Due to the compelling arguments for purposeful misinterpretation of financial information to commit fraud, audits are a legal requirement for specific businesses.
Auditor and objectives of auditing
The person who performs this process is termed as “auditor” who can be internal or external to the company depending on the type of audit being conducted by him. A report published by the Auditor on the basis of his examination and scrutiny of financial accounts is referred to as an “Audit report” in which he expresses his independent opinion.
Here, it is important to highlight main objectives of auditing as under:-
To obtain reasonable assurance that financial statements are free from material misstatement whether due to fraud and error.
To report on the financial statements are prepared and presented as per applicable laws and fulfilled statutory requirements.
Audit opinion
There are different types of audit reports/opinion, types of audit, aspects to be covered and basic principles governing audit which each auditor should comply with by applying to the best of his knowledge and discretion. 4 types of audit report/opinion:-
Unqualified opinion: It is also considered as a clean report where the auditor is satisfied with financial reporting and is free from material misstatements and the company is conducting its operations as applicable laws and governance principles. It does not contain any adverse comment.
Qualified opinion: When the auditor is not satisfied with any specific process or transaction, he will issue a qualified report. Proper explanation needs to be provided in the report for the same qualification for users to understand its impact.
3. Disclaimer opinion: When an auditor is not allowed to analyse and review any procedure or not find any satisfactory reply on his queries raised during audit, then he will issue a disclaimer report which creates adverse goodwill of the company.
4. Adverse opinion: This type of report is published when the auditor observed a high level of material misstatements and major deviations in company’s internal control in conducting operations and maintaining financial records. It is considered a red flag for the company.
Basic principles governing an audit
The auditor is responsible to comply with these basic principles while performing any audit assignments.
1. Integrity, independence, and objectivity: The auditor should exercise his full independence while reviewing financial statements and internal control of the company. He shall be free from any type of undue pressure and influence by company officials in any manner. Further, he should be honest, truthful and operate with due diligence in all his acts while performing his duties.
2. Confidentiality: Auditors should maintain utmost confidentiality of its client information during the course of the audit. He must not disclose any information to third and external parties unless there is legal or professional duty binding on him.
3. Skill and competence: Auditors must have adequate knowledge, professional experience and good interpersonal skills which are required to perform audit assignments. He should develop professional expertise to understand the business and operations of the company in order to perform audit procedures in an accurate manner.
4. Work performed by others: It is obvious that the auditor will have a team to perform different types of work relating to audit work. He may use expert opinion if required during the course of audit such as technical report of valuation, litigation reports of lawyers, actuary report. However, the auditor will remain responsible for work done by others. So, he should exercise professional expertise and experience while relying on the work done by others and review their work carefully.
5. Documentation: Auditor is required to maintain all working papers related to audit work properly and safely right from the beginning stage of audit till end of period such as appointment letter, scope of audit, audit plan, other working papers, report and records collected from client during the course of audit. These are important documents considered as audit evidence for the work done by the auditor.
6. Planning: Auditor prepares and documents audit plans for each and every audit basis which he will initiate and complete audit in a timely and efficient manner. This will be discussed with team members and well communicated to clients. It may differ as per size of the company, nature of business, geographical area, scope of audit and effectiveness of internal control of the company.
7. Audit evidence: As part of the documentation process during the course of audit, the auditor will collect sufficient and appropriate audit evidence as per his discretion to support his observations and as a proof for future purpose. He can rely on both internal and external sources of audit evidence. Internal sources refers to evidence collected within the company such as internal control manuals, company policies etc. whereas statements and confirmation collected from outside sources from third parties such as bank statements, creditors confirmations.
8. Accounting systems and internal controls: It is very crucial for auditor to first understand and evaluate the accounting and internal control system of the client company at the beginning of the audit work as it gives assurance that that company financial statements represents true and fair view, all material information have been recorded in the books of accounts, internal control system is robust enough to detect fraud and error. All these aspects are important to draw audit plans and procedures accordingly for every audit undertaken and deciding further sampling and testing techniques.
9. Audit conclusions and reporting: At the end of audit work, the auditor will express his opinion in the form of an audit report based on audit performed and evidence collected. This is communicated to the company. He will evaluate internal control and accounting system, compliance of all regulatory and statutory requirements, applicability accounting system and whether all material information has been disclosed or not.
Types of audit
On the basis of organisation
In this category, audit is divided into two types on the basis of company for audit task undertaken:-
Audit enforced by law: There are many governing bodies which require audit such as companies registered under Companies Act, banks governed by Banking Act, Tax authorities direct various types of audit etc.
Audit under voluntary class: These consist of accounts of proprietorship concern, HUF (Hindu undivided Family) business, and partnership firms. Audits for these are performed on a voluntary basis or under any special circumstances such as sanction of loan, government directives.etc.
On the basis of functions
In this category, again audit is divided into two types on the basis of function:-
External Audit: When audit is performed by independent and separate auditors outside to company affairs, this is termed as external audit such statutory audit and government audit, tax audit.
Internal Audit: When audit is performed by a separate division within a company, this is termed as internal audit.
In the end, we will see few aspects which need to be covered by auditor while performing any type of audit of financial statements of a company:
An independent examination of the accounting and internal control system is the key to confirm whether all material transactions are recorded correctly in the books of accounts.
Review of system and procedures is required to confirm whether internal controls placed in the system are working fine and adequate to avoid any fraud and errors.
Arithmetical accuracy checking of books of accounts ensures proper accounting system by verification of postings and balances.
Verification of authenticity and validity of material transactions can be done by examination of supporting relevant documents.
Proper segregation of capital and revenue transactions is required to reflect a true and fair view of financial statements.
Comparison of Balance Sheet and Profit & Loss items with previous periods for trends analysis which predict unexpected movements and their reason thereof.
Verification of the title, physical existence and valuation of assets and liabilities reflecting in the Balance sheet.
Evaluate the profit and loss figure derived showing true and correct view in line with industry trend.
Ensure compliance with applicable laws and statutory requirements.
Reporting audit results to the governing body as terms of audit assignments applicable.
Conclusion
Auditing is one of the fundamental processes that ensures transparency in the functioning of a firm. It is based on the book-keeping methodology that keeps record if every transactions taken place in the firm with the outside world thereby helping the same to function progressively well.
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This article is written by Rachna Kumari, a student at the National University of Study and Research in Law, Ranchi. This article provides an in-depth analysis of model standing orders in industrial establishments.
The purpose of model standing orders (MSO) is to safeguard the fundamental rights of workers and present a guide to employers for drafting standing orders for their industrial establishment. The Industrial Employment (Standing Orders) Central Rules, 1946, and the Industrial Employment (Standing Orders) Act, 1946, contained model standing orders for industrial establishments, major ports, mines, or oil fields that are under the control of the Central Government or State Government. As law is a crucial part of every society, with the evolution of society, law needs to evolve and address new challenges. During the COVID-19 pandemic, the world witnessed a number of problems. Labourers were not untouched by the wrath of COVID. We noticed the same when workers had to travel back to their native places on foot, and the Hon’ble Supreme Court had to intervene to address the miseries of the workers. The need of the hour was to have model standing orders for addressing the changes, new concepts, such as work from home, etc., in the country.
The legislature has taken measures to maintain a certain level of uniformity regarding the common aspects in different sectors, and specific guidelines are framed to address the specific requirements of each sector. The model standing orders are made to ensure that the workers, employees, and employers know their rights and obligations regarding holidays, work timings, a notice of change in shifts, wages, paydays, etc.
Now, we shall understand the model standing orders in detail such as what are those, the need of framing the new MSO, its key features and MSO for the manufacturing, mining and service sectors, etc.
What is a model standing order
A model standing order, commonly known as an MSO, is a set of rules, regulations, and obligations that are drafted by the Central Government to regulate the conditions of employment of workers in industrial establishments. Section 15 of the Industrial Employment (Standing Orders) Act, 1946(“IR Code”), conferred the power of making standing orders on the government; it prescribed matters to be included in the Schedule, the procedure that is to be followed for modifying standing orders certified under the Act, the procedure of certifying officers and appellate authorities, and the fee that can be charged for copies of standing orders given in the register of standing orders. It also states that before making changes to standing orders, the representatives of employers and workmen shall be consulted.
Under the new IR Code, 2020, Section 29 confers the Central Government with the power to make model standing orders relating to the terms and conditions of employment of workers, like work timings, holidays, paydays, wage rates, working in shifts, leave, attendance, work from home, transfers, grievance redressal and complaints, etc.
Section 30 of the IR Code, 2020, mandates the employer to prepare draft standing orders or any other matter considered necessary by him for incorporating necessary provisions in his establishment within six months of the commencement of the IR Code, based on the MSO in reference to matters specified in the First Schedule. Before making a draft of MSO, the employer shall consult with the trade unions or recognise the negotiating union relating to the establishment and forward the draft of standing orders electronically or physically to the certifying officer for certification. When an employer adopts a MSO for his establishment, he shall forward the information regarding the same to the concerned certifying officer, and such an MSO is deemed to be certified.
Section 12A of the Industrial Employment (Standing Orders) Act, 1946, discussed the temporary application of MSO in an industrial establishment. It stated that the model standing orders shall be applicable to an establishment and shall be deemed to be adopted, on the date on which the standing orders are certified under the Industrial Employment (Standing Orders) Act, 1946. It further states that Section 13 and 13A of the Industrial Employment( Standing Orders) Act, 1946, shall apply to the MSO as they apply to the standing orders so certified.
Section 13 states the penalties and procedure laid down if an employer fails to submit a draft MSO or modifies the MSO in contravention of the Act. Section 13A stated that if any doubt arises regarding the application or interpretation of the certified standing orders, the employer, workman may refer their query to any labour court constituted under the Industrial Disputes Act, 1947.
These model standing orders apply to all industrial establishments having 300 or more workers who are working in establishments covered under the Occupational Safety, Health, and Working Conditions Code, 2020, in different states and union territories of India.
For the purposes of determining what an industrial establishment is, we need to refer to Section 2(r) of the IR Code, 2020, but before that, let us understand what an industry is. According to Section 2(p) of the IR Code, an industry is any systematic activity carried on by cooperation between a worker and an employer for the production, supply, or distribution of goods or services with a view to satisfying human wants or wishes, such activities are done after investing capital and with the motive of making profits. The same has been interpreted by the Hon’ble Supreme Court in the case of Bangalore Water Supply and Sewerage Board v. R. Rajappa and Others (1978).
Section 2(1) contains some basic definitions which are referred to in the MSOs. “Aadhaar” refers to the Aadhaar card provided by the Central Government to all the citizens of India. Section 142 of the Code on Social Security, 2020 states that the collection of Aadhaar details by the Ministry of Labour and Employment is necessary for workers, and employees to avail the benefits of government schemes.
Procedure for certification of standing orders under the IR Code, 2020
After making any modifications to the MSO for his establishment, the employer must forward the same to the certifying officer. On receipt of the draft, the certifying officer shall issue a notice to the trade union or negotiating union or any representative of the workers in the establishment to seek their views regarding the modification and its relevance, within seven days of receipt.
The certifying officer shall complete the procedure for certification within sixty days from the date of receipt. If the draft standing order so received by the certifying officer is not certified within sixty days, it shall be deemed to have been certified. A group of employers can submit a joint draft of standing orders under Section 30 of the IR Code, 2020.
Key features of model standing orders
The MSO came into existence with some advanced features, considering the changing times in today’s world. However, many features were retained from the Industrial Employment (Standing Orders) Act, 1946, as well. Some of the key features of the model standing order are as follows:
Classification of workers
Firstly, the MSO classifies workers in six categories:
Permanent workers
Those workers who have been associated with an industrial establishment on a permanent basis, including those who have completed a probationary period (which is of six months) in the same or another occupation in the industrial establishment. The period of six months includes the breaks taken by a worker due to sickness, accident, leave, lockout, involuntary closure of the establishment, etc.
Temporary workers
Those workers who have been associated with the establishment for work that is temporary in nature and is anticipated to be completed within a limited period of time.
Apprentices
Those individuals who are undergoing apprenticeship training under the Apprenticeship Act, 1961, are referred to as apprentices. Apprenticeship training is a skill program wherein a person is engaged by a company as an apprentice and gains classroom (theory) learning for a short period, followed by on-the-job (practical) training.
Probationers
Those workers who are employed to fill a permanent vacancy in a post and have not completed six months of service. The period of probation can be extended to three more months after evaluating the probationer’s performance.
Badli workers
Those individuals who are employed as a replacement for a permanent worker or a probationer until they are absent.
Fixed-term employment
It applies to those workers who are employed on the basis of a written contract of employment with the employer for a fixed period of time. Such workers have the same number of working hours, wages, allowance, and other benefits, etc., as permanent workers doing the same work or work of similar nature. They are also eligible for all statutory benefits available to a permanent worker, including gratuity (if the services are rendered under a contract for one year).
Publication of work timings
The MSO mandates the display of working hours for all categories of workers on a notice board or electronic notice board and on the HR portal of the industrial establishment in Hindi, English, and the local language, which is known to and spoken by the majority of workers in the establishment.
However, in the case of the IT sector, the working hours shall be as per the agreement or conditions of appointment between the employer and the worker. Any change in the period of working hours, number of shifts, etc., is to be displayed on the notice board.
Publication of holidays, paydays, wage rates, and wage bands
Similar to the work timings, national and festival holidays, paydays, wage rates, and wage bands are to be mandatorily published on the electronic board or notice board and website or Human Resource (HR) portal of the establishment in Hindi, English, and any other local language spoken by the majority of the workers of the industrial establishment.
All payments, including wages, to the workers must be paid by crediting the worker’s bank account via electronic mode. The intimidation to the payment shall be sent through SMS, e-mail, or social media platforms like WhatsApp, etc.
Shift working
The model standing order allows a worker to work in shifts, i.e., day, afternoon, and night, in a department(s) of an industrial establishment, at the discretion of the employer. If more than one shift is worked, the worker must be transferred from one shift to another. It is to be noted that a shift cannot be discontinued without a prior notice of twenty-one days, given in writing by the employer to the workers. No such notice is to be given if the closing of a shift is bound by an agreement between workers and the employer.
In case there are any changes made to shift working, a notice of the same shall be displayed by the employer on the notice board and HR portal of the establishment. If a registered trade union exists in the establishment in question, a copy of the aforementioned notice shall be furnished to the union, either electronically or by registered post to the secretary of the union.
Work from home
Work from home, also known as remote work, is an arrangement where workers are allowed to work from their own homes. This concept gained popularity during the outbreak of COVID-19 when everyone was bound to stay at home. Another reason for its popularity is the advancement of technology, which has made it easier to communicate and collaborate via online platforms that can help a worker get work done in the comfort of his/her home. This concept comes with several advantages, such as flexibility for the workers, who can work at their own pace and according to their schedule. It saves time and, as a result, increases productivity. An employer also saves money and resources by reducing costs such as rent, utilities, etc.
Following a similar ideology, MSO also allows a worker to work from home for a period of time under conditions of appointment specified by the employer. This is a welcoming step that acknowledges the changes adopted in the legislation with the change in times.
With regards to the territorial jurisdiction of a court in case of any conflict between employer and employee when the employee is allowed to work from home merely as a concession or a convenience, the place of suing would be the place where the office is located and not the residence of the employee. The Kerala High Court has ascertained it in the case ofMangala A.G. v. Union of India (2021).
Attendance
All the workers must be at work at the time fixed by the employer, and the wages of the workers coming late will be liable to be deducted according to the provisions in the Code on Wages, 2019. Workers have to comply with the regulations related to work hours and shall register their attendance by using their own identity card or biometrics at the start of their shift and at the close of their shift. No worker is allowed to use or punch anyone else’s identity badge under any circumstances. A worker who is habitual of coming late and remains absent will be liable for deduction of wages as per the Code on Wages, 2019.
In matters relating to the discipline of employees, if a worker is considered habitually undisciplined or if he/she is found guilty of misconduct three or more times in a period of twelve months, the employer may take disciplinary action against such a worker.
Leave
A leave refers to a period of time when a worker is permitted to be absent from work. This is granted by an employer and can be paid or unpaid. A leave cannot be claimed as a matter of right and is always taken at the discretion of the employer. A worker who desires to seek leave shall apply to the employer or any other concerned officer of the establishment at least seven days in advance. The employer has to issue an order regarding the approval or rejection of leave within a week of submission or two days before the start of leave, whichever is earlier. In case of a rejection of the application for leave, the employer has to communicate the reasons for the rejection in writing to the worker. Holidays with pay are allowed as per the provisions of the OSHWC Code, 2020.
A casual leave can be granted to a worker with or without pay, not exceeding ten days in a year. Such a leave must not be for more than three days.
Record of service
A record of service must be maintained by the employer for each worker, either electronically or manually. The certificate of service, change of residential address of workers, and age of the worker shall constitute the service record. Every worker is entitled to get a service certificate issued by the employer certifying the nature, designation, and period of employment undertaken by the worker, at the time of discharge, retirement, resignation, or termination. Every worker shall disclose his exact age to the employer.
Retirement
The age of retirement can be mutually agreed upon by the employer and worker through an agreement, but in the absence of such an agreement, fifty-eight shall be deemed the age of retirement for a worker.
Transfer of workers
The MSO mandates a transfer policy in an industrial establishment, and the same has to be intimidating to all workers. The details of the same will be mentioned on the HR portal. A worker may be transferred from one department to another or from one establishment to another under the same employer. However, the worker should be transferred to a job that he is capable of doing, considering that his wages, grade, and continuity of service are not adversely affected. A notice within a reasonable time must be given to the worker.
Medical examination
As per the provisions of the OSHWC Code, all workers employed in an establishment must clear a medical examination by the medical authority nominated by the industrial establishment. A worker who comes to know that he has contracted an infectious disease shall notify the concerned manager without any delay, and such a worker shall not be allowed to work. This is a duty and right of an employee under Sections 13(d) and 14(2) of the OSHWC Code, 2020, respectively. Any worker who deliberately suppresses the fact that he is suffering from a contagious disease shall be held liable for misconduct, and disciplinary action can be taken against him.
Stoppage of work
In the event of a fire, catastrophe, disaster, pandemic, epidemic, or other cause beyond the control of the employer, the employer can terminate any provision or provisions of the industrial establishment wholly or partly for any period without notice. In such a case, the workers shall be informed by notice put on the notice board, electronic board, or HR portal.
Section 5 of the Factories Act, 1948, mentioned the power of the state government to exempt factories from the provisions of the Act in cases of “public emergency”. This term gave rise to the case ofGujarat Mazdoor Sabha v. State of Gujarat (2020), where, during COVID-19, the Gujarat Government suspended labour laws using Section 5 of the Factories Act, 1948, and exempted industrial establishments from the effect of the same. Considering the exemption, the employer increased the working hours of the workers to 12 hours per day from 9 hours per day. The petitioners contended that this was a violation of labour laws. The Hon’ble Supreme Court interpreted ‘“public emergency” and held that COVID-19 was not a public emergency, hence, the increase in working hours is not justified, and the exemption is not justified as well.
Now, under Section 128 of the OSHWC Code, we can observe that the legislature has increased the ambit of government’s power to exempt industrial establishments during a public emergency by including the terms “disaster” and “pandemic”.
In 2021, the Supreme Court took suo moto cognizance, in the caseIn Re Problems and Miseries of Migrant Workers v. Union of India (2021) to address the concerns of migrant workers. Here, the Hon’ble Court referred to the statement of objects and reasons of the Act and directed the government to provide adequate relief to the migrant workers and make arrangements for them to reach their homes safely.
Termination of employment
MSO discusses termination of employment and states that it shall apply to an industrial establishment employing three hundred or more workers. It shall not apply to such establishments where the work is performed intermittently or is of a seasonal character. In the case of the termination of employment of a permanent worker, a prior notice of one month has to be served on him. No such notice needs to be served on a temporary worker, probationer, badli worker, or fixed-term employment worker. In all cases, wages and other dues shall be paid.
Disciplinary action in cases of misconduct
When charges of misconduct are levied against a worker and the investigation or inquiry into complaints is pending, the worker may be suspended by the employer. The investigation shall conclude within ninety days of suspension.
Misconduct includes theft, fraud, dishonesty in connection with the property or business of the employer, taking or giving bribes, wilful disobedience, habitual late attendance without a reasonable cause, drunkenness, sleeping on duty, continuous absence from work without the permission of the employer and without sufficient cause for more than ten days, etc.
In an inquiry, a worker is entitled to appear in person or be represented by an office bearer of the trade union of which he’s a member. The proceedings shall be recorded in Hindi, English, or the language of the state, as per the choice of the worker, and must be concluded within ninety days. In case, the worker is found guilty, the employer is well within his rights to dismiss, suspend, fine, stop his annual increment, or reduce his rank.
In awarding any punishment, the authority imposing the punishment must take the gravity of the misconduct and previous records into consideration. The detailed explanation of misconduct is done with the intention of not leaving any scope that leads to a miscarriage of justice. In the case of Delhi Transport Corporation. v. D.T.C. Mazdoor Congress (1991), the counsel submitted that the requirement of defining ‘misconduct’ in the standing orders and providing meticulous provisions for a just, fair, and reasonable inquiry into charges of ‘misconduct’ is the mandatory requirement of the Industrial Employment (Standing Orders) Act, 1946. The counsel relied on the case U.P. State Electricity Board v. Hari Shanker Jain And Ors. (1978) for his submission.
Model standing order for the services sector, 2020
The model standing order for the services sector is a standardised set of rules that determine the rights and obligations of employers and workers. These are some very basic rules that are to be followed by the employer. However, to advance the rights of workers, there are some concerns that need to be addressed by the legislature.
Firstly, we are aware of the concept of maternity leave in labour laws, but there is no provision for paternity leave. With the advancement of equal rights and equal duties of spouses in taking care of children, paternity leaves should also be introduced in statutes as well as in model standing orders.
Secondly, the COVID-19 pandemic has had a significant impact on people’s mental health. The pandemic caused fear, anxiety, and mental agony for people. Although the OSHWC Code and Model Standing Order mention the physical health of the worker, any provision regarding the mental health of the worker finds no mention anywhere in the Code. Since the mental health of workers is important for productivity and efficiency at work, the government can make it mandatory for the employer to organise seminars, and sessions educating the workers about mental well-being.
Thirdly, the Hon’ble Supreme Court acknowledged homosexuality in the case of Navtej Singh Johar v. Union of India (2018) and took a step forward to promote equality and inclusivity for the LGBTQ+ community. Gender-neutral washrooms must be set up in all industrial establishments to provide a safe space to those who do not conform to the binary gender norms, such as transgenders and non-binary people.
Fourthly, with the government’s emphasis on using digital resources, the risks attached to the same should be noted. Attempts should be made by the employer to make the workers aware of bank fraud and financial scams. Special sessions can be organised in collaboration with banks so that workers don’t fall into the trap of scammers.
Indian laws governing model standing orders
With the amalgamation of several labour legislations into codes such as the Industrial Relations Code, 2020, OSHWC, 2020, the Social Security Code, 2020, and the Code on Wages, 2019, the Industrial Employment (Standing Orders) Act, 1946, was incorporated into the Industrial Relations Code, 2020 (hereinafter referred to as the “IR Code”). The IR Code now encompasses the provisions of the Industrial Employment (Standing Orders) Act, of 1946 in Chapter IV of the IR Code. Section 29(1) of the IR Code confers the power of making model standing orders, on the Central Government. It reads as follows, “The Central Government shall make model standing orders relating to conditions of service and other matters incidental thereto or connected therewith”.
Section 28 of the IR Code states that the provisions of Chapter IV shall apply to every industrial establishment where three hundred or more than three hundred workers are/were employed on any day of the preceding twelve months.
The legislature has passed the model standing order for the manufacturing and mining sectors. For the first time, mining workers are going to be provided with railway travel facilities. When a worker takes a leave and is qualified for free railway fare, the employer has to give him the cost equivalent to his ticket, including bus and boat fare (if applicable).
Those workers who have completed a period of twelve months of continuous service qualify for railway fares. A worker shall be given money on his return from leave. This benefit is available to inter-state migrant workers.
Provisions regarding model standing orders are also present in the Industrial Relations Code and the Occupational Safety, Health, and Working Conditions Code.
Conclusion
The labour codes and model standing orders have not been implemented yet, but their implementation will be a welcome step in the field of labour laws. These orders standardise and streamline the process of providing adequate facilities, rights, and duties to workers and employers, ensuring that industrial establishments are regulated and the interests of workers are protected. Furthermore, these orders can be modified according to the needs of particular industrial establishments in different sectors. The adoption of changes like working from home, medical examinations, etc., will result in improvements in the productivity and efficiency of workers and will contribute to the economic advancement of the country. In the words of the then minister of State for Labour & Employment, Shri Santosh Kumar Gangwar, “these Model Standing Orders will pave the way for the industry harmony in the country as its aim is to formalise the service-related matters in an amicable manner”.
Frequently Asked Questions (FAQs)
Can an employer prepare a draft of standing orders for his establishment?
Yes, as per Section 30 of the IR Code, 2020, an employer shall prepare draft standing orders within six months. Those orders should be based on the model standing orders. Any order made by the employer which is in contravention of the model standing orders shall be rejected by the certifying officer.
Does the new model standing orders apply to IT companies as well?
Yes, for adopting a uniform approach across all industries under the service sector, the legislature has made it mandatory for IT companies to follow the new MSO.
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Specialists are found in all occupations, and real estate has many areas where real estate agents can specialise. A specialty helps focus the professional’s attention and marketing efforts on a specific type of client, and he/she is not usually required to exclude other types of clients. With technology driving processes, real estate has become more of a service business versus a sales business than ever before. This article touches on various aspects of the real estate professional’s role in the real estate business in the United States, from types, fees, and specialisation categories to finally considering how specialisation can affect outcomes.
Brokers and agents
Brokers are most commonly found in the real estate, finance, and insurance industries, as well as the food, chemical, and manufacturing industries. They may represent either a buyer or a seller and are paid by the party who hires them. They perform only a few of the marketing flows, seldom carry inventory or assume risk, and their main function is to ease buying and selling,that is, to bring buyers and sellers together and negotiate between them. Real estate transactions in the United States usually involve a listing broker working for the seller and a cooperating broker working for the buyer. They typically do not have fiduciary or legal duties entrusted to them, as a lawyer or stockbroker may have.
The transition of businesses from the traditional way of advertising to that of digitally enhanced one with ubiquitous internet access at home, school, work, and the library has brought about irrevocable changes in the way we as consumers earn, learn, travel, shop, buy, and sell.
While technology has to a large extent displaced the small and middle level travel agent shop and various other small businesses, real estate agents are still very much around and are, from all accounts, anecdotal as well as statistical, thriving. Employment of real estate brokers and sales agents is projected to grow 5 percent from 2021 to 2031, about as fast as the average for all occupations, according to the Occupational Outlook Handbook: published by the U.S. Bureau of Labour Statistics (bls.gov).
Clarity on terms real estate broker, agent and realtor in the United States
If you are planning on buying or selling a home in the United States, you will most likely engage the services of a real estate agent, broker, or realtor. Though all of these real estate professionals are licensed to help you buy, sell, or rent a home, they are distinct from one another in their qualifications and their footing in the industry.
★ A real estate agent is licensed by the state to help people buy and sell real estate, and is paid a commission when a deal is completed.
★ A real estate broker does the same job as an agent but is licensed to work independently and may employ agents. Brokers are paid on commission but also get a percentage of the commissions of agents who work for them.
★ The term realtor is not often used by people and correctly it should read as and refer to REALTOR®. A realtor is a member of the National Association of Realtors (NAR) and may be an agent or a broker, among other professions in the industry.
Role of a real estate agent
Reduced transaction costs in property sales are largely due to real estate agents. The legal framework controlling the contractual connection between the principal (the house owner) and agent has been demonstrated to affect the incentives they confront and the impact they have on selling price and time on market.
Along with the use of technology in their initial home search, prospective property buyers and sellers routinely use the services of a real estate agent, and only in later stages of the transaction do they meet with a real estate attorney to check on liens, encroachments, and restrictions. Real estate agents can help with this and check municipal records for information.
Despite no immediately apparent problems in a home, most buyers and sellers appreciate the help an agent can give them. For instance, agents attend home inspections, negotiate repairs, and go through documents such as titles, title insurance, and surveys with buyers. For sellers, agents will list a property on the MLS, which is a multiple listing service, conduct open houses, network, and market the property. Thus, real estate agents can simplify the process of property buying and selling, and an expert in a particular area can ease the transaction even more.
Real estate brokerage fee
Traditionally, the cost of most real estate transactions was tied to the value of the home rather than the value of the services provided by the real estate agent, which could be well worth the fee. The real estate broker receives their fee either as a commission or as a flat fee, the latter being a newer concept that has gained considerable ground. Within the traditional commission model, there are the options of full-service brokerage or a discounted commission with a reduced service package.
2.5–3% is the listing fee that traditional brokerages usually charge to sell your home (plus a buyer’s agent commission of a similar amount), bringing your outgoing commission expenses up to 5-6%. Let’s take an average house worth $500,000.00. When you list with a traditional real estate agent that has a commission based on the value of your home, you can expect to pay your listing agent at least $15,000.00 in commission and the buyer‘s agent at the other end of the transaction, bringing your total to $30,000.00. Each agent pays about half of the 3 percent fee to his or her firm. The selling agent keeps just 1.5 percent of the final sale price.
Specialisation in the real estate agent’s role
It is necessary to note that in situations where a real estate agent is utilised in a real estate transaction, the role it has to play is that of an agent, thereby facilitating the conduct between the buyer and seller. This particular service is what attracts homebuyers when they are purchasing a new home.
It is common knowledge that property owners wishing to sell their home will hire an agent to help them complete the sale quickly. A prospective house buyer will want the assistance of an agent who gives them hope that a suitable property can be found while keeping the cost of the transaction to a minimum. Real estate experts are engaged for their experience and specialised knowledge, but it is apparent that the level of productivity and experience of such people will differ greatly.
What specialisation does is allow a prospective buyer or seller to hire particular types of real estate agents who are well versed with specific types of property, housing laws, and how to govern buyers who are in niche categories and have an interest in luxuries.
Designations
★ NAR’s Green Designation
This designation teaches agents how to gain a competitive edge when marketing green homes. Real estate agents learn how green properties are marketed differently than traditional homes. Green issues, research, and resources taught include how energy-efficient and sustainable features impact real estate.
★ Seniors Real Estate Specialist (SRES)
This designation caters to real estate agents who want to sell homes in age-restricted communities. Professionals study buying, selling, relocating, and refinancing residential and investment properties. They learn how to help seniors prepare for life-changing decisions and issues related to real estate, such as pensions, retirement, and loan fraud.
Certifications
★ At Home With Diversity® (AHWD): The AHWD certification concentrates on issues concerning multicultural populations, including diversity sensitivity, U.S. fair housing laws, and developing professional guidelines in a growing multicultural real estate market.
★ Luxury Homes Certification (LHC): The Luxury Homes Certification teaches agents how to sharpen their skills and prepare for the evolving luxury home market. The certification covers the luxury niche, pricing strategies, negotiation tactics, and how to distinguish oneself from other professionals.
★ Military Relocation Professional (MRP): The MRP certification prepares agents to work with military professionals. The course focuses on VA financing, procedures, and decision-making processes associated with military relocation and housing options.
★ Resort & Second-Home Property Specialist (RSPS): The RSPS certification was designed for real estate agents representing clients interested in purchasing and selling second homes and resort properties. Clients might include retirees, vacationers, managers, and investors.
Commercial real estate agents require the initial state issued certification and then a training programme with mentorship from a real estate firm that handles commercial real estate. They also usually need to have membership in a professional organisation such as NAR, ULI (Urban Land Institute), or REBNY (Real Estate Board of New York). They can then choose to specialise in and sub-specialize in areas such as shopping complexes, office buildings, hospitals, laboratories, agricultural land, unimproved land (land with no electricity, water set up and requires special legal knowledge), short sale, foreclosures, etc.
Other areas are development, which is purchasing land and building on it, arranging financing, negotiating tenant leases, and supervising the process; and property management, which includes handling day-to-day operations such as repairs, staffing, and so on.
Implications and applications of specialisation
We have seen that after the initial learning foundations are laid, there are other areas of specialisation for the agent, such as focusing on only one side of the transaction, either buying or selling, or type of property, such as golf communities, resorts, condos, or commercial real estate. Being able to offer specialised services means the agency can adapt their service offerings and costs of doing business to meet consumer needs and price concerns. Specialisation would enhance:
★ Individual professional development
Having a sphere of specialisation helps the individual agent stand out and helps focus marketing efforts, generating better leads.
★ Broker agency credibility and productivity
Having subject matter experts or specialists in the real estate office can boost a team’s efficiency or even a solo professional’s productivity. A buyer, be they an investor, first-time buyer, veteran, or one with environmental concerns, would be readily convinced of a broker’s credibility if the broker’s office boasts of a team of specialists, one of whom can handle his/her concerns rather than generalists.
Within the team, each member knows their role and area of expertise, allowing the agent to refer the client to the best suited agent. Customers need to be educated that a significant amount of time and attention goes into selling your property and ensuring that all the necessary government documents are properly executed, along with the legal forms. Seeing specialists on the team can assure the customer that such services are well worth the commission being charged.
★ Better service, leads and relations within the industry
Being a specialist also means that each team member has cultivated dedicated relationships with vendors and key players, like loan officers, throughout the industry. They bring better negotiation skills to the table, know the questions to ask, the disclosures that owners have to make about property issues (septic tank, asbestos, lead paint in the house etc.) A property disclosure statement and lead paint disclosure for most properties built before 1978 (with some exemptions) are required by law.
They are conversant with the county and local regulations and codes, can check for them, ask pertinent questions, and ensure that a competent professional, such as a house inspector or electrician, checks for house foundation, paint, and electric wire issues and gets him/her to check areas of concern. A home inspector cannot tell a client, for legal reasons, “Buy this house” or “Do not buy this house.” The home inspector can only report if something works or doesn’t and point out cracks, leakages, and some potential issues. He/she will not go through the house history and title search, cloud on title etc. An agent or in house specialist can advise verbally, with some reservations in wording, about buying the house. All of this further research done by the specialist agent results in high quality service for the client. Networking and building business relationships with other specialists helps all in the real estate industry benefit by creating better leads, contacts, sales, immense client satisfaction, excellent reputations for the agency, and word of mouth advertising.
Finally, and most importantly, rather than having the house on the market for 3-6 months, the average listing time can be cut considerably by having one or more specialists on the real estate agency team. Although factors like technological access and competition from full-service discount brokerages are making service rates more affordable and customers can shop around for service with a lesser fee, there are soft skills as well as knowledge skills that are irreplaceable.
Building a warm relationship with the client, taking and making numerous phone calls, hand-holding, though not literally, driving clients around or accompanying them to viewings, along with specialised knowledge, are hard to replace skills. Some of these existed among the best real estate agents before formal specialisation and are ingrained among the top players in the industry.
Issues that are not affected by specialisation and will stay
★ Just like repair ‘handymen’, automobile mechanics, and attorneys, real estate agents know more about their area of expertise than the people paying them for their services. Car mechanics on occasion recommend more expensive repairs than are necessary, attorneys can charge high fees for services that savvy consumers could perform themselves, and realtors can give sales advice that boosts their profit rather than that of the homeowner.
★ Most real estate transactions require two agents from different agencies to cooperate, not one as in a travel agency, stock brokerage or insurance sales. The fact that a competitor’s cooperation is necessary to conduct business opens an opportunity for activities that support collusion. NAR and the Department of Justice (DOJ) have worked out agreements that uphold NAR’s pro consumer stance of transparency and knowledge regarding commissions. However, if a buyer’s agent offers clients low-cost online access to home listings, other agents can refuse to make their own listings available through such channels. Or, if a seller’s agent cuts her commission rate, other agents may “punish” her by steering their potential buyers away from her listed homes.
Conclusion
As has been shown, specialisation is a value add of high ethical standards and skills, both soft and practical, that help enhance the perception a customer has of the service he/she will receive and the customer’s overall experience.
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Primarily, the Islamic jurisprudence has based the contract law with regard to several underlying principles that help understand the functioning of such law. As in general we know that the Indian Contract Act, 1872 being a technical field of law has been based on several doctrines that has been reflected and adopted by judicial precedents as well, Islamic contract law does not separate itself completely from the same. Whenever we are talking about Islamic contract law, there are certain well-known terminologies that need to be understood to understand the law in an efficient manner. This article serves as a discussion of those terminologies alongside focusing on the Islamic contract law in large.
All about Islamic contract law
While we delve deeper in the Islamic contract law, we need to understand that jurists belonging to the formative/classical period of Islamic law had not expressly laid down a general theory of contract that can be associated with the Islamic law. Because of the same, two radically different, although equally mistaken, conclusions have arisen. The same has been stated hereunder:
The first conclusion states that as Islamic contract law does not have any general theory to rest upon, the same reflects the existence of conceptual primitiveness that open rooms for ambiguity in this segment of law. This has been generally concluded by non‐Muslim scholars of Islamic law
The second conclusion that we need to know is a reaction to the first point which has been laid down by Muslim scholars, who have tried to establish the fact that there does exist a general theory of contract law. The general theory that Muslim scholars have talked about rests its basis on the ability of Islamic law to enforce innominate contracts.
Contract under Islamic law majorly involves three terms, namely, Riba (Interest), Gharar (Uncertainty), and Maysir (Speculation).
Riba
Riba is also known as interest in Islamic Law. It is the interest which is charged on deposits and loans. The Islamic practice forbids Riba, even if it is at a low rate of interest as it is not ethical practice and it is also illegal. Riba is prohibited under Sharia law for many reasons. The Islamic banking system provides several setups which make sure that the transactions take place without charging explicit interest amounts.
There are two types of Riba:
Riba in a loan contract.
Riba in a sale or exchange contract.
Gharar
Gharar is also known as uncertainty under Islamic law. It is associated with deception, risk, hazards. It is prohibited under Islamic law as it gives rise to unclear or suspicious claims of ownership. For ex:- Futures and option contracts( contracts which have dates of delivery in the future time) give rise to gharar.
Maysir
Maysir is also known as speculation under Islamic law. It is prohibited in Islamic law as it creates money by chance, or by gambling without hard work. Due to Maysir, various financial products are not generally used such as the options, futures etc. Maysir is a practice of getting anything with short cuts too easily. It is like either a person wins by chance or fails. Earning like this can be declared as “Haraam”.
Essentials for a contract under Islamic Law
There are six essential elements which need to be fulfilled:-
The offeror.
The offeree.
Offer.
Acceptance.
The subject matter.
Consideration
To enter into a legally enforceable contract, both the parties must attend the age of puberty and both have to be of sound mind. Therefore, in a contract both physical and intellectual maturity are of great importance to determine the validity of the contract. Contracts can occur both in oral and written form and also be entered by the conduct of the parties. There is a kind of flexibility in the contract where an offeror is able to withdraw its offer before an offeree accepts it.
Subject of the contract under Islamic Law
The subject must be:-
Lawful.
In existence.
Not fabricated.
Deliverable.
Precisely
The Islamic law prohibits dealing with nuisances to public orders such as alcohol, pork, gambling, pornography etc.
Good faith principle of Islamic Contract Law
The good faith principle of Islamic law establishes justice, fair dealing, prohibits riba, speculation or high risk. This principle is an absolute necessity for the functioning of international legal order. The principle is not only to make one understand what good or bad is, but what we are to be and to do in situations that turn out to be divergent and complicated, for a just and reasonable better living. The good faith principle also goes ahead to safeguard both the investors’ and also the firm, thereby disclosing misrepresentation, fraud, cheating, illegal purposes and people exploitation owing to their ignorance.
Types of contracts under Islamic Law
Contracts resulting in a permanent transfer of ownership
In these types of contracts there is a permanent transfer of ownership of the subject matter of the contract. For ex:- A regular sale of a house, where one party transfers the ownership to the other party where the other party pays agreed consideration for the ownership.
Contracts resulting in the temporary transfer of ownership
These are the types of contracts where the transfer of ownership is not permanent. For ex:- A loan agreement where the loan amount is transferred by the payee on a temporary basis to the borrower. At the maturity period, the borrower returns the amount to the payee again.
Contracts resulting in no transfer of ownership
These are the types of contracts where there is no transfer of ownership. For ex:- lease agreement where the lessor leases the assets to the lessee under the terms of the lease. There is no transfer of ownership, here the lessor has the legal title over the assets, the lessee only has the right to use the assets. Sometimes, under a lease agreement the title of the leased asset might transfer but for a time after that it would end.
Conditions that must exist for contracts in Islamic Law
Existence of parties to the contract:- Both the parties must be real, not insane, and are responsible enough for their work.
Existence of subject matter of the contract:- The subject should be permissible and should be in the possession of the relevant part.
Existence of offer and acceptance:- They can either be oral or written and are time bound.
Free will of the parties:- Both parties are free to enter into the contract, there should be no force, threat or coercion.
Contract should not contradict any objective of Shariah:- The contract shouldn’t contradict the objectives which are referred to in the Maqasid Al- Shariah.
Contract should be free from the prohibition of shariah:- The contract should be free from the major prohibitions which are stated above in this article. Apart from that the contract should be prohibited from the sale of debt with debt.
Al – Kharaj- Bi- Daman:- That means if a person is willing for profit of any sort then he/she must be willing for the loss to incur in the future.
Conditions for cancellation of offer
· When the offer withdrawal
· If the death occur of either of the party
· Termination of the session
· Destruction of the subject matter
· Revocation of offer
Limitation on enforceability of contract
Under Sharia law not every contract agreement is deliberately ignored unless it is not allowed in the disclosure in the book of God, it is invalid. The Sharia hardly talks about contractual freedom beyond the standard contract types. Rather, it provides a situation where a contract can be merged. Some more ban upraise by other Hadith, some pertinent ones are ban on loan, and sale, two sales in one, and a sale of what one does not have. The contract may or may not be void if the court observes a condition void.
Remedies for breach of contract
Revocation is allowed under some specific circumstances, such as when the seller fails to perform his or her obligations, when the product is not in the proper manner either it is defective or completely broken, when the quality of the service is not up to the mark, when some unforeseen circumstances occur which prevents the contract completion.
As per the Islamic law, contractual remedies are limited to direct and actual damages. The courts will not accept speculative awards such as economic loss of chance, interest, possible profits, and other. Moreover, injunctive relief and specific performance are typically unavailable.
The connection between contracting parties and any object covered by the agreement is fixed by Islamic law in terms of liability for loss or damage. A party may possess the item as a “guarantor” or a “trustee” (damin). Unless there is evidence of a trust violation, a trustee is not at all accountable for damage to the item. Nonetheless, a damin is equally at risk of losing money as an owner. The guarantor has no recourse if an item is destroyed due to an act of God or force majeure.
Conclusion
The contract in Islamic law doesn’t generally end with speaking or writing, the thing which is required is the consent of both the offeror and the accepter. The first stage of any contract is the offer then the acceptance. There must be a declaration by the offeror and then there must be an acceptance to the contract to be completed. Both the offer and the acceptance must take place at the same meeting (majlis). In Islamic law, there are several types of contracts but we actually focus on those which are to be used in Islamic Financing. The Quran contains a number of contracts which are specified which includes commercial contracts, deposits, security etc. The Islamic contract law is much wider in scope as compared to the English and French as the Islamic law includes more settlements, conveyances, transfers, payments etc. which are not included in either English and French.
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This article is written by Aanika Aery, currently pursuing B.B.A. LLB from Symbiosis Law School, Noida; and Kishita Gupta, an advocate who is a graduate of the Unitedworld School of Law, Karnavati University in Gandhinagar. This is an exhaustive article which deals with the Parsi Marriage and Divorce, 1936.
The Parsi marriage is also considered important for its validity to be a contract via an Ashirvad religious ceremony. The word ‘Ashirvad’ literally means blessings. A prayer or God’s call to the parties to comply with their marital duties of trust. The marriage and divorce are stated in a separate act for Parsis, known as the Parsi Marriage and Divorce Act, 1936. The same will be discussed below in the given article.
The Bombay High Court, in the case of Sir Dinshaw Manockji Petit v. Sir Jamsetji Jeejeebhoy (1908) observed that the Iranies from Persia who come to India, either temporarily or permanently, and profess the Zoroastrian religion, along with the children of Parsi fathers by alien mothers who have been duly and properly admitted into the religion, make up the Parsi Community. These people are all descended from the original Persian emigrants. The Parsis in India are descended from a group of Persians who were forced to abandon their homeland around 1200 years ago as a result of Mahomedan religious persecution. After seeking refuge in Kohistan and the Isle of Ormus, this group of Persians ultimately settled in India; at the moment, Bombay serves as their main administrative centre.
In another judgement by the Bombay High Court, Jamshed Irani v. Banu Iarni (1967), it was observed that long before 1936, Zoroastrians from Iran and India were referred to as Parsis, and this usage was widespread in both countries. Consequently, the Act’s use of the term “Parsi” refers to both Iranian and Indian Zoroastrians.
It was observed in the case of Sarwar Merwan Yezdiar v. Merwan Rashid Yezdiar (1950) that a Zoroastrian who temporarily lives in India while being registered as a foreigner and whose residence remains Persian does not magically transform into a Parsi just because they share the same racial heritage. An Iranian can only become a Parsi by residing in India, and that is at least a necessary prerequisite. As a result, the Parsi Chief Matrimonial Court, which was established in accordance with the Parsi Marriage and Divorce Act, 1936, lacks the authority to hear an action for dissolution of marriage brought against him. Section 29 of the Parsi Marriage and Divorce Act, 1936 designates the appropriate court where a complaint may be filed. It assumes that the lawsuits filed have jurisdiction, but that by itself, that jurisdiction cannot be granted in cases when the court lacks jurisdiction.
to “desert” together with its grammatical variations and cognate expressions, means to desert
the other party to marriage without reasonable cause and without the consent, or against the will, of such party;
“grievous hurt” means—
(a) emasculation;
(b) permanent privation of the sight of either eye;
(c) permanent privation of the hearing of either ear;
(d) privation of any member or joint;
(e) destruction or permanent impairing of the powers of any member or joint;
(f) permanent disfiguration of the head or face; or
(g) any hurt which endangers life;
“husband” means a Parsi husband;
“marriage” means a marriage between Parsis whether contracted before or after the commencement of this Act;
a “Parsi” means a Parsi Zoroastrian;
“priest” means a Parsi priest and includes Dastur and Mobed; and
“wife” means a Parsi wife”.
Applicability
Marriage shall not apply if, in any degree of consanguinity that is both contracting parties relate to each other and share the same ancestry.
Marriages are not valid in Parsi Law when marriages are not solemnized by the priest with two Parsi witnesses in attendance.
A marriage shall not be accepted if the husband is 21 years old and the wife is 18 years old.
When marriage is not valid as set out above, a child born out of that marriage will be illegitimate.
Marriage between Parsis
Requisites of a valid marriage
No Marriage shall be valid if—
(a) the Contracting Parties, in the presence of two other Parsi witnesses other than that priest, have a relationship with each other at any level of consanguinity or affinity as defined in Schedule I; or
(b) such marriage shall be solemnized by any Parsi form of a ceremony called “Ashirvad” by a priest or (a) any Parsi (if that Parsi has changed).
Punishment for bigamy
Any Parsi, who has been married during his or her life, is subject to the penalties provided for by the India Penal Code for an offence to return to marriage during the lifetime of a Parsi or not, without being legally divorced by a wife or husband or having his or her previous marriage declared invalid or dissolved.
Remarriage when unlawful
(1) No Parsi shall, in the lifetime of a wife or a husband, marry, whether or not a Parsi, except after he has divorced or married that wife or husband legally, or after marriage to that wife or husband has been declared null, or is void of or is dissolved and, if so, whether he or she has been legally made null and void or dissolved.
(2) Any marriage which does not agree to the above-stated provision will be considered void.
Registration of divorce
In the case of a court decree concerning divorce, nullity or dissolution, the Court shall transmit to the Registrar of Marriages within the jurisdiction referred to in Section 7 a copy of that decree for registration; the Registrar shall enter the same in a registry for the purposes of its preservation and shall apply the provisions of Part II which are applicable to Registrars and marriage registers,
The penalty under the Act:
The Priest, in his or her opinion, shall be penalized by the single prison for a term of six months, or by a fine that may amount to two hundred rupees, or for both, on conviction of any priest who wilfully and knowingly celebrates marriage contrary to and in violation of Section 4.
Any priest who fails to comply with any provision found in Section 6 shall be punished with a single sentence of imprisonment or with a fine extending to one hundred rupees or with both, on conviction of such an offence.
Any other person to subscribe to, or authorize the certificate in compliance with section 6 who willfully fails to do so or fails to do so may, on conviction, be punished with a fine of no more than one hundred rupees for all such offences.
Each person making, signing or attesting to a false declaration that he knows or thinks is false shall be punished for the period extending to 3 months by simple imprisonment or by an additional penalty extending into 1000 rupees, or by both; and if the act is equivalent in counterfeiting, as specified in the Indian Penal Code ( Act 45 of 1860).
Any officer who has not entered such a certificate under paragraph 6 shall be disciplined for a period of one year or one thousand rupees or with all of them with simple imprisonment.
Any person sealing the register, destroying it, or altering it in any section, unlawfully, or fraudulently shall be punished with imprisonment for a period of five years, which may extend to five years, of either category as specified in the Indian Penal code (45 of 1860), or, where he is registered, of the Indian Penal Code (45 of 1860).
Requisites of a valid marriage
Degree of prohibited relationship in Parsi law
The Parsi law forbids or discourages marriages between specific relatives through consanguinity and affinity, just like all other personal laws. Schedule I of the Act has a table that lists all the prohibited degrees of relationship. These connections are made through the parents, the children, the spouse or husband, the sister, and the brother.
The Ashirwad ceremony
Ashirvad simply translates to “blessing.” It has to do with calling on God to bless the union of spouses. The Parsi priest carries out the ritual. Dastur and Mobed are the two types of Parsi priests that are mentioned in Section 2(8). Any of them may perform “Ashirvad.” In addition to the priest, there is a requirement for two Parsi witnesses. Section 6 mandates that the priest performing the ceremony must certify the union using the template provided in Schedule II of the Act.
Legal age of marriage in Parsi law
The provision of legal age to marry in Parsi Law was added by the 1988 Amendment Act. At the time of marriage, the male must be at least 21 years old, and the female must be at least 18 years old. Even if they switch their religion or place of residence, the Parsis must abide by this marriage requirement. Now, if the agreement of his or her father or guardian was gained, as it was in the Act of 1965, the marriage of a Parsi who has not reached the required age could not be a lawful one.
Child born in a void marriage
This provision was also added by the 1988 Amendment Act. The child born of a void marriage is just as legitimate as if he had been the result of a valid marriage, even if the marriage was void because it violated the standards outlined in Section 3(1) of the Act. The clause applies both going forward and going back. The Parsi Act does not limit the inheritance rights of children of invalid marriages to parents solely, in contrast to Hindu law and the Special Marriage Act, 1954.
Parsi Matrimonial Courts
In each of the Presidency towns of Calcutta, Madras and Bombay, and in certain other locations within the territories of the various State government agencies, a Special Court shall be formed for the purposes of the hearing suits pursuant to this Act.
The Parsi Chief Matrimonial Court of Calcutta, Madras, or Bombay, as the case may be, is so founded in each Presidency-town.
Chief Matrimonial Courts-The local limits of the Parsi Matrimonial Court competence shall correspond with the local limits of the High Court’s ordinary original civil competence, alimony and maintenance, both continuous and pendiente lite, shall be supported by a Chief Justice of the High Court or by any other judges of the Supreme Justice from time to time appointed by the Judge of that Matrimonial Court, and, when dealing with cases under this Act, by one [five delegates, except in relation to —
(a) interlocutory applications and cases of proceedings;
(b) care, protection and education of children and
(c) matters and prosecutions other than routine trials of cases; and
(d) other cases and other prosecutions.
District Matrimonial Courts-The Parsi District Matrimonial Court of this place is the title of a court so constituted in a place other than President Itself. The geographical limits of the jurisdiction of the Tribunal shall correspond with the limits of the district in which it is located, subject to the provisions of section 21. (a) The Judge of the main Court of original civil jurisdiction shall be the Judge of that Marriage Court and in proceedings against cases under this jurisdiction. (b) alimony and care, both the pendente lite and the permanent one; (c) custody of children, care and training; (d) all matters and procedures other than the usual hearing of cases.
Any district which the State government finds inappropriate to include in the jurisdiction of any District Matrimonial Court because of the insufficient existence of the Parsi residents shall be included within the jurisdiction for those Territories in which that Court applies, under the jurisdiction of the Parsi Chief Matrimonial Court. Unless the delegate is dead, is over, refuses to give up, or is unable or unable to work, or ceases to be a Parsi, or is convicted of a violation under the Indian Penal Code (45 of 1860) or other law for a period 1 (including a moral tort), then and so often State Government can be considered as insolvent.
The delegates chosen by the State Government pursuant to Sections 19 and 20 for assistance with the administration of the suits under this Act are, by the orders of the President Judge of the Court, taken from delegates designated by the State Government in accordance with Section 24, under proper rotation.
Any suit brought in pursuant to this Act shall, at the time of commencement of proceedings, be brought to trial under its jurisdiction [or where a wedding has been solemnized in compliance with this Act]. When the accused has at that time left (the jurisdictions protected by this law) the case shall be brought before the Court where the complainant and the accused have lived together for the last time.
The way the trials are conducted is one of the Act’s most distinctive elements. In addition to being presided over by a judge, the trial is also performed in the presence of ‘five delegates’ who serve as the jury, and with their aid. Although the word ‘jury’ is not used in the Act, the delegates’ function is somewhat comparable to that of a jury. In India, the jury system was eliminated in all procedures by 1960. With the exception of cases handled in accordance with this Act, the K.M. Nanavati case (1961) may have been the end of the jury system. Notwithstanding the fact that the Act’s jury system has been the subject of several discussions about its benefits and drawbacks, the focus of this part of the article is strictly on the approach and process that is often used to appoint delegates under the Act. Yet, it would be vital to comprehend the purpose and range of the delegates’ powers under the Act before moving on to analyse the procedure.
Role of the delegates and their functions
The Parsi Matrimonial Courts are designated as “Special Courts” by the Act and are established to hear cases. According to Sections 19 and 20 of the Act, the presiding Judge will preside over the trial of cases before these Special Courts, the Parsi Chief Matrimonial Courts (for the Presidency towns for Calcutta, Madras, or Bombay), or the Parsi District Matrimonial Courts (for districts or areas other than the Presidency towns).
Although the Act does not define the phrase “regular hearing of cases,” judicial rulings have construed the phrase to cover those matters that are under dispute by the relevant parties. They include matrimonial lawsuits governed by Section 30 (suits for nullity), Section 32 (divorce), Section 36 (restitution of conjugal rights), etc., where the factual basis must be established. Apart from the limitations stated in Sections 19 and 20, the Bombay High Court in the case of Minoo Rustomji Shroff v. Union of India (2005) has ruled that delegates are not required to support the presiding judge in non-contentious proceedings like divorce by mutual consent under Section 32-B of the Act.
It was observed by the Bombay High Court in the case of Rohinton Panthaky v. Armin R. Panthaky (2014) that the Presiding Judge’s and the delegates’ responsibilities are carefully segregated. According to Section 46 of the Act, all questions of law and procedure must be decided by the Presiding Judge, but the decision regarding the facts of the case must be made by a majority of the delegates present at the trial unless there is an equal division of opinion among the delegates, in which case the Presiding Judge will make the decision. Factual determinations are only required when they are in dispute between the parties. The Judge makes decisions on matters of law and procedure, but the delegates’ findings of fact are definitive and are not appellate in nature.
According to Section 27 of the Act, the delegates designated under Section 24 by the State Government shall be replaced by the delegates chosen under Sections 19 and 20 in accordance with the orders of the Presiding Judge of the court. The proviso of the Section allows each party to the marriage dispute/suit to challenge any two of the court-invited delegates without giving a reason before such delegates are chosen, and no delegate who has been so challenged can be chosen.
Power and procedure for appointing delegates
Under the Act, the State Government has sole authority to name delegates. According to Section 24 of the Act, the local Parsis must be given an opportunity of expressing their opinion in such a manner as the respective Government may think fit before the State Government appoints delegates in the Presidency towns and the district of the State under the jurisdiction of their respective Governments. Only Parsis may be appointed as delegates, and the names of those chosen must be published in the Official Gazette in accordance with subsection (2). Within the local bounds of a High Court’s ordinary civil jurisdiction, no more than thirty Parsis may be appointed, and no more than twenty Parsis may be appointed in a district.
One of the Act’s most noticeable features is the lack of any mechanism or procedure for delegate nomination, even though the State Government has the authority to do so. If one were to examine the overall structure of the Act and the Statement of Objectives and Reasons of Amendment Act 5 of 1988, the omission of such a provision would appear to be deliberate. It would be reasonable to presume that, in the absence of any system specified by the Act, the Parsi community members in a given area or jurisdiction are left to their own devices and are free to decide the process and manner in which the delegates are to be nominated. This leads to a lack of uniformity, therefore the process used would vary depending on the location.
One of the most prominent cases that dealt with the issue of delegate nominations was Delforooz Darius Dorabjee v. State of Maharashtra (2006) by the Bombay High Court. In this case, in Pune, the petitioner-wife had served the respondent-husband with a divorce petition. The petitioner filed a writ petition in the Bombay High Court while the matrimonial proceedings were still pending, asking for a writ of certiorari to overturn and annul a government notification dated 10-2-2005 that had appointed 11 people as delegates for a period of 10 years to assist in the adjudication of cases arising under the provisions of the Act in the Parsi Matrimonial Court in Pune. One of the additional requests was to reverse and annul the District Court of Pune’s order, which served as the Parsi Matrimonial Court’s order dated 13-7-2005, which overruled the petitioner’s objection to the notice of delegates’ appointments on the grounds that they intended to contest their appointment as a result of a government notification dated 10-2-2005.
The Hon’ble High Court acknowledged that no regulations or guidelines establishing a process for the appointment of delegates have been issued pursuant to the Act, but emphasised the significance of providing the local Parsis with a forum to voice their opinions, as provided for in Section 24 of the Act. The Court’s reasoning is based on the freedom to express one’s viewpoint. Therefore, the ultimate inference that can be drawn from the Court’s reasoning is that the procedure followed need not necessarily be uniform in its application and may differ from place to place as long as the local Parsi community is given the opportunity to voice their opinion in the process of the appointment of delegates.
Matrimonial suits
In Parsi Divorce Act one of the partners may dissolve marriages by three means:
Nullity cases: Unless the consummation is unlikely because of natural causes, the marriage may be declared null or void.
Grounds for divorce:
Any married person may sue for divorce on one or more of the following grounds, under the Parsi Law Act of divorce: Marriage has not been consummated within 1 year of its officialization on grounds of the defendant’s deliberate failure to conduct it.
The defendant at the time of the marriage was mentally ill or of unsound mind and has been habitually so up to the date of the suit.
That the defendant was at the time of the marriage pregnant by some person other than the plaintiff: Provided that divorce shall not be granted on this ground, unless the plaintiff was at the time of the marriage unaware of the fact alleged, the suit has been filed within 2 years of the date of marriage, and marital intercourse has not taken place after the plaintiff came to know of the fact.
Reasons for marriage dissolution: When a husband or wife are separated from one another for a period of seven years.
The complainant shall take the co-defendant in any proceedings in relation to adultery divorce unless otherwise directed by the Court, and the Court shall, in all other proceedings in connection with which the adultery is supposed to have been committed, order the adulterer to pay the whole or part of the proceedings’ costs. If a husband has abandoned his cohabitation with his wife, deserted or, without a valid reason, has ceased to co-exist with his spouse, the party so deserted or with whom co-existence so stopped may, if satisfied with the truth of the claim in the plea, sue for reimbursement of his or her conjugal rights and the Court.
Children of the Parties
In any proceeding under the present Act, the Court may from time to time pass these interim orders in respect of the custody, maintenance and training of children under 6 years of age (till 18 years) in a definitive judgment which it finds fair and proper to marry the parent to which the case relates, and may, upon request, apply for the final order.
If it has been made to the Tribunal that a wife has a right to any possession or reversal of property, the Court may order a settlement of that right which it finds it fair to make of any part of that property not exceeding one-half of it for the benefit of thin any case in respect of which a decree of divorce or judicial separation for the adulteries of a wife is given.
Conclusion
The Parsis are an endogamous group of solely monogamous people. Marriage between priestly and non-priestly families was often avoided. Given these constraints and the small size of the group, it is not surprising that close family members are possible partners. Although the incidence of cross and parallel marriages is not common — less than 1% of all marriages in 1961, intergenerational marriages (e.g., between uncle and niece are allowed). A decline in marriages and a rising birth rate is the biggest challenge faced by society today.
Given these constraints and the group’s limited scale, it is not surprising that close families are potential partners. While cross and parallel marriages— less than 1% of all marriages in 1961— are rare, intergenerational marriages are allowed (e.g., between the uncle and the niece). The biggest problem facing society today is a decline in marriages and a rising birth rate. The two parents will inherit their sons and daughters. No primogeniture laws exist. Notwithstanding the above formal rules, affluent Parsis also leave their entire estates for charitable purposes, such as schools for endowment, hospitals, fire temples or the like. The emphasis on compassion and the sense of collective obligation in childhood for the poor and vulnerable find their expression in will and trust. Hence the ongoing division of wealth between the wealthy and the poor has taken place.
Frequently Asked Questions (FAQs)
What principles govern the Parsi Personal Laws?
Parsi law is the body of law that governs India’s Parsi Zoroastrian community. The legal tradition of the nineteenth century is essentially where Parsi law originates. The principles such as marriage, divorce, maintenance, alimony, child protection, etc. are some of the principles that govern the Parsi personal laws.
Why do the Parsis have their own distinct personal law?
The Zoroastrian religion is practised by the Parsis, who have different beliefs from the Hindus, Muslims, and Christians of India. They also have different personal rules.
A Parsi marriage is a type of contract that is performed through a ceremony known as “Ashirvad,” which literally translates to “blessings,” and is governed by the Parsi Marriage and Divorce Act, 1936. Since there is no formal adoption among Parsis, if a Parsi couple wishes to become parents, the child would not automatically be entitled to inherit anything. The Parsis have their own customs about marriage, so there was a need to pass a law that regulates it separately.
This article is written by Sakshi Singh, from Amity Law School, Lucknow. This article provides a detailed analysis of Section 15 of the Juvenile Justice (Care and Protection of Children) Act, 2000, which enumerates conditions for preliminary assessment.
Juveniles in conflict with the law are dealt with in accordance with a separate statute, the Juvenile Justice (Care and Protection of Children) Act, 2015 (“the Act”). When a juvenile is brought to the justice system upon commission of a crime or upon being in conflict with the law, there are several actions (under Section 18 of the Act) that may be taken after considering the age and severity of the offence committed.
If the child is under 12 years of age, no action is taken except for taking the child to the youth care office for reformation or counselling. Juveniles committing offences may also be sent to perform unpaid community service. There can be short detention or other penalties and non-punitive orders.
A new form of action added by the Act of 2015 is the “trial of juveniles as adults”. This means that juveniles can also be prone to the adult criminal justice system upon commission of certain offences. Offences committed by Juveniles can be categorised into three parts-
Firstly, petty offences, as defined in Section 2(45) of the Act, are those offences which have minimum punishment for a term of not more than 3 years in the Indian Penal Code, 1860 (“IPC”) or any other criminal law for the time being in force.
Secondly, serious offences are defined in Section 2(54) of the Act, which states that offences for which the sentence of imprisonment is between 3 years to 7 years in IPC or any other criminal law are known as serious offences.
Lastly, heinous offences are defined in Section 2(33) of the Act and constitute all those offences having minimum punishment of 7 years of imprisonment under IPC or any other law.
Of all these categories of offences under the Juvenile Protection Act, only juveniles committing heinous offences are eligible for preliminary assessment under Section 15 of the Act. This provision is about preliminary assessment by the Juvenile Justice Board (“Board”) as defined in Section 2(10). A preliminary assessment is an inquiry procedure to determine the mental and physical capacity of juveniles in connection with the offence committed by them.
Historical background of Section 15 of Juvenile Justice Act, 2015
The Juvenile Justice (Care and Protection Act) first came into existence in the year 2000, after replacing the previous Act governing juveniles, the Juvenile Justice Act, 1986. To date, the Act has been amended three times in the years 2002, 2006, and 2015.
In 2012, a physiotherapy student named Jyoti Singh was travelling with her male friend on a public bus in Delhi when she got raped by five people, including a 17 years old juvenile. You are probably all aware of this ‘Nirbhaya’ incident, which attracted nationwide concerns about such delinquent children, and demands were widely raised for them to be treated and tried as adults. But, at that time, the Juvenile Justice Act of 2000 didn’t have any such provision; therefore, the juvenile was released after 3 years of imprisonment.
There were also demands to lower the age of juveniles to 16 years, which the Justice J S Verma Committee Report summarily rejected. It was recommended in that report that juvenile offenders be treated in accordance with the facility or capacity they have, be it physical or mental. Obiter dicta of the Apex Court in the case of Dr. Subramanian Swamy v. Raju, through Member, Juvenile Justice Board (2014) and recommendations of the Justice J S. Verma Committee, has made the Parliament amend Section 15 of the Act.
What does Section 15 of Juvenile Justice Act state
Preliminary assessment
Juvenile, as defined in sub-section 35 of Section 2 of the Act, is a person who is under 18 years of age. A child who is in conflict of law within the meaning of Section 2(13) shall be subject to an inquiry or preliminary assessment (only for heinous offences) in accordance with the provisions of this Act. In a literal sense, a preliminary assessment is an informal way of conducting an investigation in which two things are determined. Firstly, whether to proceed with it or not; and secondly, if yes, then how to proceed.
Section 15 of the Act mandates preliminary assessment of juveniles in conflict with the law subject to the following conditions-
Juveniles of the age above 16 years and below 18 years;
Commission of heinous offence as given under Section 2(33) of the Act.
The Juvenile Justice Board conducts a preliminary assessment to determine if the conditions mentioned above are fulfilled. A determination of the physical and mental ability of a juvenile to commit the crime is made. Based on the result of such a preliminary assessment, the Board passes a reasonable order as to whether a juvenile can be tried as an adult in the Court of Law.
Inquiry for preliminary assessment
Assessment by the Board can also be considered one of the kinds of inquiry under Section 14 of the Act, which provides for the procedure of inquiry of the Board regarding a child in conflict with the law. Further, Section 14(5) of the Act states that the Board must ensure a fair and speedy inquiry. It also provides that an inquiry into the heinous offences committed by children in the 16-18 age group shall be dealt with in the manner prescribed under Section 15.
Assistance of Psychologist
Rule 10A of the Juvenile Justice (Care and Protection of Children) Model Rules, 2016 enumerates the procedure for conducting a preliminary assessment under Section 15 of the Act. It states that for the purpose of carrying a preliminary assessment of juveniles committing heinous offences, if necessary, Board may take the help of the following persons-
Psychologist;
Psycho-social workers; or
Any other expert person who has experience working with children in difficult circumstances.
In addition, the proviso of Section 15(1) of the Act also states that the Board is free to seek the assistance of an experienced psychologist, psycho-social worker, or any other expert in the field. The District Child Protection Unit Hall has to look after the availability of the experts stated above. The board may consult these experts on any question of the psyche, or they may even ask for an independent assessment of the juvenile by these experts.
In the case of Olef Khan vs. State of Madhya Pradesh (2021), the High Court considered the question of whether the word “may”, used in reference to the assistance of psychologists during a preliminary assessment, should be construed as “shall,” i.e., a mandatory pre-condition. The court has held that “when the word ‘may’ is used in an enactment in respect of a Court, the same has to be understood as ‘shall’.” The point of construing the word “may” as “shall” was well validated by the Supreme Court back in 1963 in the case of Ramji Missir vs. State of Bihar.
Period of assessment
The second proviso of Section 15(2) states that the Board is bound to complete the assessment procedure by the time limit specified in Section 14 of the Act for this purpose.
Generally, any such inquiry by the Board must be completed within a period of 4 months from the date when the child was first produced before the Board. However, in certain exceptional circumstances, an extension of the period of 2 months could be provided. The extension will be granted in exceptional circumstances only after recording the reason for such an extension in writing. But, where a heinous offence is alleged to have been committed by the juvenile, a preliminary assessment under Section 15 must be completed within 3 months in accordance with Section 14(3). For an extension of the time limit for completion of the preliminary assessment, the Board shall get such an extension approved by the Chief Judicial Magistrate (CJM) or the Chief Metropolitan Magistrate (CMM) for reasons to be recorded in writing.
Conditions for passing an order under Section 15 of Juvenile Justice Act, 2015
Juvenile Justice Board
Juvenile Justice Board (JJB), also known as the Board, is constituted under Section 4 of the Act. JJB is authorised by law to conduct a preliminary assessment and pass an order for the purpose of Section 15 of the Act. It is a multi-disciplinary body that exercises its duties and responsibilities mentioned in Section 8 of the Act in connection with children in conflict with the law.
If police apprehend any child in conflict with the law, such a child should be produced before the Board within 24 hours (vide Section 10 of the Act) through a special Juvenile Police Unit or a designated child welfare police officer.
There must be a heinous offence
First and foremost, to start a preliminary assessment of a child in conflict with the law, the Board must ensure that he has committed a heinous offence. “Heinous offences”, as per the definition given under Section 2(33) of the Act, are those offences for which the IPC or any other criminal law for the time being in force prescribes a term of imprisonment of 7 years or more.
In the case of State of Maharashtra v. Shadab Tabarak Khan (2022), a group of persons were charged under various provisions of the IPC and the Unlawful Activities Prevention Act, 1976 (UAPA) for their engagement in terrorist activities. One of them was a juvenile; therefore, the state had filed an application for a preliminary assessment of the juvenile. However, the Board has rejected the application. Upon the appeal of the aggrieved party, the Bombay High Court has held that for preliminary assessment, a juvenile must commit an offence for which a minimum of 7 years of punishment is prescribed. Since none of the applicable provisions of the IPC or UAPA complies with the said condition, the appeal was rejected.
Age group of 16-18 years
Although anyone who is below 18 years of age is considered ‘Juvenile’ under Section 2(35) of the Act, When a juvenile comes into conflict with the law, and he/ she is under 16 years of age, requisite orders will be made in accordance with Section 18 of the Act.
Under preliminary assessment, the Board intends to check if the juvenile in conflict with the law can be treated like an adult if he has committed a heinous offence and has the requisite capacity to commit the crime. Only juveniles from the age group of 16- 18 years of age can undergo preliminary assessment, and that too if other conditions (commission of a heinous offence) are satisfied.
Capacity to commit an offence
Before passing an order of preliminary assessment for the trial of the juvenile as an adult following conditions regarding the capacity to commit an offence must be fulfilled-
The capacity of juveniles to commit a crime. This includes both mens rea i.e. mental capacity as well as physical capacity;
Ability to understand the consequence of the offence so committed;
Circumstances and preceding conditions in which the said offence was committed.
Order of board under Section 15 of Juvenile Justice Act, 2015
Disposal of the case by the Board
After conducting a preliminary assessment under Section 15 of the Act, the Board may, if they are of the opinion that the case is to be disposed of by them, dispose of the case of the juvenile in accordance with the procedure for trial in a summon case under the Code of Criminal Procedure, 1973. Section 18 of the Act, inter alia, states that Board, after the assessment under Section 15, may pass any of the following orders-
Make the juvenile go for counselling along with his parents or guardian. An order for group counselling can also be passed;
Performance of community service under any person or organisation;
Order for payment of penalty by the juvenile himself or by the parent or guardian;
Release of a child on probation for good conduct. Such released child must be in the custody of parent or guardian or any other person for a period not more than 3 years;
Give directions to send the child to a special home to get the facility such as “education, skill development, counselling, behaviour modification therapy, and psychiatric support” for a period not more than 3 years.
Order of exoneration
After the enquiry, if it appears to the Board that the juvenile in question has not committed any offence, then it shall pass an order of exoneration accordingly as per Section 17 of the Act. The Board, under this Section, can also send that juvenile to the Child Welfare Committee (“CWC”) if need be.
Children’s Court
After the preliminary assessment, if the Board is of the opinion that a juvenile should be tried as an adult, then it shall transfer the case to Children’s Court. Where the Board, after preliminary assessment, orders the trial of the juvenile to be conducted in the same manner as that of the adult, it shall attest to the reason for the same.
Sub-section 3 of Section 18 of the Act states that after conducting the preliminary assessment if it appears to the Board as reasonable, it may transfer the case to the Children’s Court of competent jurisdiction to hear the matter in a similar manner as the trial of an adult.
Section 19 of the Act states that after getting a reference from the Board, the Children’s Court may conduct the trial of the juvenile in accordance with the provisions of the CrPC. Further, it may also conduct an assessment again instead of initiating a trial procedure. The Children’s Court has the power to pass an order under Section 18 of the Act.
Provision for appeal
Section 101 of the Act states the provision for appeal from the order passed by the Board. Among others, it states that, if aggrieved by the order of the Board in preliminary assessment, a person may appeal in the Court of Sessions. Sessions Court, while deciding on appeal, may take the help of psychologists or any other expert, but not the one who assisted the Board during the preliminary assessment. An appeal is to be made to the Children’s Court within 30 days from the date of the order of the Board.
Question of constitutional validity of Section 15 of Juvenile Justice Act, 2015
Violation of Right to Equality
It is argued by the opponents that Section 15 of the JJ Act is violative of Article 14 of the Constitution of India. Firstly, children/ juveniles who are below 16 years of age are treated differently from those who are above 16 but below 18 years of age. Secondly, the reasons for such differential treatment are not justified.
However, to cater for this argument, it is provided that the right to equality is granted to every citizen of India, subject to reasonable restriction. A reasonable restriction must be based on intelligible differentia and rational nexus. In this scenario, for Section 15 to not violate the right to equality, the differentiation of children/juveniles below 16 years and others must be based upon a reason, and that reason must be in consonance with the object sought to be achieved.
Violation of right under Article 20(3)
In the process of the preliminary assessment, the Board is advised to seek assistance from psychologists or psycho-social workers whenever necessary. The result of the preliminary assessment by the Board is, to some extent, based on the report of the psychologist appointed to assist the Board in the matter.
It is often argued that these psychological experts subject children to intimate, self-incriminating statements because whatever they say might be used against them. Further, the Act does not bestow any right of consent upon the children, so they can, if unwilling, refuse to go on with the psychologist. Therefore, it can be seen as a violation of the fundamental right against self-incrimination as envisaged in Article 20(3) of the Indian Constitution.
Other loopholes in Section 15
The Juvenile Justice Act evolved over time with the aim of providing care and protection to juveniles in need and also giving a chance for improvement to those who, for any reason, act in conflict with the law. Accordingly, the Juvenile Justice Board does not take a punitive approach towards juveniles.
The mental capacity of juveniles to commit a crime is not very easy to determine as there is no definite test for it, unlike medical tests. Because of the time-barred (3 months) proceedings of the preliminary assessment, an arbitrary and hastened decision with possible errors could be expected most of the time.
Judicial pronouncements
Barun Chandra Thakur vs. Master Bholu (2022)
Facts of the case
In the case of Barun Chandra Thakur vs. Master Bholu, a student of 2nd grade named Prince was subjected to murder by cutting his throat in the school washroom. Another student of the school, Bholu, from class 9th, was accused of murder. The Board has conducted a preliminary assessment as Bholu was over 16 years old and had committed a heinous offence. Afterwards, the Board ordered the trial of the juvenile as an adult on the reasoning that the juvenile had sufficient maturity and ability to understand the consequences of the action.
Order of the Court
It was held by the Supreme Court that the task of the preliminary assessment is granted to the Board only and not to the court of law. Therefore, it could only be ordered on the matter of whether the assessment was in accordance with the procedure established by law or not. As 3.5 years have passed since then and the juvenile has turned 21 years old, the court is not in a position to assess whether further testing is to be carried out by the board or not. Thus, it is now at the discretion of the board. The court has further directed the government to come up with guidelines to assist and facilitate the board in making the preliminary assessment.
Shilpa Mittal vs. State of NCT of Delhi (2020)
Facts of the case
In the case of Shilpa Mittal vs. State of NCT of Delhi, a boy above 16 years of age killed a person because of rash driving and was consequently charged with culpable homicide under Section 304 of the IPC. Section 304 states that “...whosoever commits an act with the knowledge that it is likely to cause death or to cause such bodily injury as is likely to cause death…” would amount to culpable homicide, not murder.
Here, the juvenile has acted with the knowledge that the act of rash driving might take lives. Despite having such knowledge, he committed the crime, which attracted punishment for a term that may extend to 10 years. Considering the above facts, the Board has taken cognisance of the crime and ordered the trial of juveniles as adults.
Order of the Court
The Apex Court, while deciding on the question as to whether the juvenile is to be subjected to preliminary assessment or not in reference to the commission of a ‘heinous offence’, has held that an offence that does not provide a minimum sentence of 7 years cannot be treated as a heinous offence. The Court has opined that “when the language of the Section is clear and it prescribes a minimum sentence of 7 years imprisonment while dealing with heinous offences then we cannot wish away the word ‘minimum’.”
Further, the court has exercised its power under Article 142 of the Indian Constitution and established that for offences for which a minimum sentence is not specified but the maximum sentence is more than 7 years, these offences will fall within the ambit of “serious offence” as defined under Section 2(54) of the Act until the Parliament makes any amendments to the present statute.
Smt. Durga vs. State of Rajasthan (2019)
Facts of the case
In the case of Durga vs. State of Rajasthan, Smt. Durga was accused of murdering her husband. She was subjected to domestic violence out of suspicion of illicit affairs. One day they had a big fight, and after that, Durga was caught with an axe in her hand and the body of her husband lying in a pool of blood. Upon her arrest, it was noticed that she was a juvenile; therefore, the investigation was handed over to the Juvenile Justice Board. Since murder under Section 302 of the IPC attracts the punishment of life imprisonment (i.e., more than 7 years), it will be counted as a heinous offence.
The Board inquired about the matter in accordance with Section 15 of the Act and transferred the case to the Session Court for the trial of the juvenile as an adult. Appellant Smt, Durga appealed to the High Court against the order of the Session Court, which convicted her of murder.
Order of the Court
The Rajasthan High Court has acquitted Smt. Durga on the ground that she was driven to commit the offence because of the conduct of the victim. The Court further reasoned out that “the anger of a young girl who is harassed, humiliated and treated cruelly in her matrimonial home and that too by the man with whom she contracted a love marriage, can very well be understood because the doors of her maternal home are closed for her.”
Conclusion
There are two sections of people, one who supports treating children committing a heinous offence with extreme punishment argues that after the fact of their mental and physical capacity to commit the crime becomes clear, even children of 16-18 years of age should be prone to be in the criminal justice system as adults. Another voice speaks for the reformative welfare of children and asks to maintain the sanctity of the Juvenile Justice Act. They argue that it isn’t overruling the objective of the Juvenile Justice Act by treating children below 18 years of age as adults for whatever purposes.
Both of these opinions received the validation of jurists and scholars. Therefore, it becomes very crucial to handle this subject of great importance with utmost caution, and thus, the JJ Board must consider the welfare of children while ordering anything after a preliminary assessment. A balance must be struck between two extreme opinions. While the provisions for the treatment of children as adults must not be abolished, considering the well-being of society, but when giving such an order, the welfare of children must be considered, and chances for reformation must be examined.
Frequently Asked Questions (FAQs)
Whether the commencement of preliminary assessment is deprivation of natural justice?
As of now, no judicial interpretation is made regarding preliminary assessment under Section 15 of the Act being against the principle of natural justice. Arguments both against and in favour are made in this regard. However, the Indian judiciary has called upon the central government, the State Commission for Protection of Child Rights and the National Commission for Protection of Child Rights to issue appropriate guidelines to assist the Board in the preliminary assessment.
Whether or not Juveniles can be punished with the death penalty for heinous crimes?
There is no such bar for capital punishment to Juveniles. After the recent amendment to the Juvenile Justice Act in 2015, juveniles from the age group of 16-18 might be treated as adults if they commit heinous offences. Therefore, some offences might attract a death sentence in the same manner it is given to an adult person.
However, capital punishment for juveniles is avoided to a great extent. It is opined by the Supreme Court in various cases that a juvenile can’t be granted a death sentence on being accused of Death, rape or any other heinous crime. Retributive theory and deterrent theory of crime should be applied more often to Juvenile cases.
Provision for preliminary assessment is added in which year?
Though, Juvenile Justice Act came into existence in the year 2000, which gives protection to children in need and provides for reformative treatment to children in conflict with the law. It is after the Nirbhaya case, the Act got a new form in the year 2015 and the provision for preliminary assessment got added under Section 15, which inter alia provided for considering some children as adults for the trial of the case.
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